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Lords Chamber

Volume 737: debated on Thursday 24 May 2012

House of Lords

Thursday, 24 May 2012.

Prayers—read by the Lord Bishop of St Edmundsbury and Ipswich.

International Criminal Court


Asked by

To ask Her Majesty’s Government what progress has been made in securing the arrest of Joseph Kony, Omar al-Bashir and others indicted by the International Criminal Court for crimes against humanity.

My Lords, the International Criminal Court relies entirely on state co-operation to ensure enforcement of its arrest warrants. The British Government, together with our EU partners, frequently raise the importance of states fulfilling their international obligations and taking the necessary steps to bring to justice individuals indicted by the court. Those currently fugitive from ICC warrants should be reminded that they, like Radovan Karadzic and General Mladic, cannot evade the international justice system indefinitely.

My Lords, given that Kony was indicted in 2005, and that Omar al-Bashir, who was indicted in 2009 for crimes against humanity in Darfur, is now waging a new war against his own people in Southern Kordofan, does not a failure to bring those indicted to account risk compromising the ICC and bringing it into disrepute? What resources are we committing to the work of the ICC? When a head of state is indicted by it, how is that reflected in the conduct of our economic and diplomatic policies? Either this is genocide or it is not. Either it is crimes against humanity or it is not. Either they are indicted or they are not. Either it is business as usual or it is not.

It certainly is not business as usual. The noble Lord, who follows these things very closely, is perhaps not taking into account the fact that this system has taken some years to get going. The indictments are out but there are real problems in pinning these people down. He mentioned two cases. We know that Mr Joseph Kony is highly elusive and can slip across borders. At least the Government of Uganda were very successful the other day in capturing his deputy, Caesar Acellam. Uganda is a signatory to the ICC and I am sure that it will fulfil its obligations in accordance with international justice.

As for the leader of Sudan, we know exactly what the position is. We and our EU colleagues seek to keep contact with Khartoum because all the parties—South Sudan, Sudan itself, the opposition parties and, indeed, the Opposition—believe that we should do so. However, the problem of fulfilling an ICC charge against Mr Omar al-Bashir is obviously a practical, physical one in that he is not in reach unless he were to leave the country.

My noble friend will be aware that since April, when Bosco Ntaganda’s rebel troops defected, they have managed forcibly to recruit more than 150 child soldiers and caused 40,000 villagers to flee, thereby causing more chaos in that region. The United Nations Security Council is absolutely clear about MONUSCO’s mandate for its mission in the Congo: it has the authority to assist the Government to arrest indicted war criminals. MONUSCO officials on the ground say that they have not been asked to do anything and are not involved, yet ICC officials have asked the Government to pursue the matter. However, nothing has happened. Overall, this is a case of prevarication.

It is very difficult to ascertain exactly what is happening on the ground. No one could expect there to be full information, full access or full details. However, we fully support the work of the ICC in bringing Bosco Ntaganda to justice and bringing additional charges against him. I think the implication of my noble friend’s question and the preceding one is that somehow the ICC should have further powers over and above the existing situation in which national Governments have to seek to co-operate and take the initial action. That, of course, would raise fundamental questions about the workings of the ICC and whether we should go back to square one and revise the legislation. I do not believe that we should; I think that we should give the present process more scope and more encouragement. However, I understand what is behind my noble friend’s question.

My Lords, given that crimes against humanity are defined by the United Nations as,

“a widespread attack on a civilian population”,

does the Minister not agree that Robert Mugabe should be investigated by the prosecutor and subsequently indicted by the ICC? Is it not tragically clear that there is evidence of his responsibility for the Matabeleland massacres in the 1980s that were committed by his army brigade, continued state-sponsored violence against political opponents, and ongoing atrocities in the diamond fields in Zimbabwe? What pressure is Her Majesty’s Government using to ensure that this wicked man faces international criminal justice?

I do not dispute anything that the noble Baroness has said, with her acute understanding of the situation there. However, the realities are these: Zimbabwe is not a party to the Rome statute and to get an ICC charge against Mr Mugabe would require a UN Security Council resolution. That means getting past all five of the permanent members. We know what the view of some of the permanent members is: they should not take such action. Until we can get past this problem of the permanent five, and particularly the reluctance of China and Russia, to name two, to see these matters taken up by the UN and remitted to the ICC for charges, these people who have committed most unsavoury acts—the noble Baroness mentioned Mr Mugabe as one—are outside the reach of the ICC.

My Lords, is the Minister aware that not only is President al-Bashir indicted by the ICC but he actually deposed the elected governor of Southern Kordofan, replacing him with Ahmad Harun, who is also indicted by the ICC and has since been carrying out systematic slaughter and aerial bombardment of his people, leading to the displacement of hundreds of thousands of people? What reassurance can Her Majesty’s Government give to the victims of those policies? I have spoken to people in the refugee camps and—I am afraid this sounds harsh—many have said to me, “Why does Britain not intervene? Our suffering is far worse than that of Libya. Does Britain really only do business with Khartoum and those indicted by the ICC?”. That is the feeling among many people in Sudan.

With respect to the noble Baroness, that is unfair because she knows better than most of us that the real problem is access. We cannot get access to these very ugly and difficult areas to establish what is happening. She quite rightly mentions that the governor of Southern Kordofan and one other are already indicted by the ICC and need to face justice. The UN has ruled through the Security Council that they should be referred to the ICC, which has issued warrants against them. The question is: how can they be secured and brought to justice in The Hague? That remains a continuous battle. As for the general proposition that we speak only to Khartoum or Djuba, that is not to understand the enormous amount of work we are doing at every level with the international agencies to bring some hope to this very unpleasant and ugly situation.

Entrepreneurship Opportunities


Asked by

To ask Her Majesty’s Government what measures they are taking to develop entrepreneurship opportunities for young people in the United Kingdom.

My Lords, the evidence shows that to build enterprise, ambition and capability in young people it is important to provide hands-on experience at school and ensure ongoing access to support and advice. My Government have therefore developed a range of activities to inspire and give confidence to young people throughout schools, colleges and universities. Next week, my noble friend Lord Young will launch a new start-up loan scheme to improve access to finance for young entrepreneurs.

I am grateful for my noble friend’s Answer. She may be aware that at the Global Entrepreneurship Congress held in Liverpool Sir Richard Branson suggested that, for many young people who had a business acumen, university was not for them; that we might consider instead that student loans should go to them to establish businesses; and that they should be mentored by business leaders. Does the Minister think that that is a good proposition? If so, how do we develop it? Perhaps a meeting should be held with Richard Branson to develop his idea.

The Government recognise the need to help young people to access the finance that they need to start up their own businesses and to be entrepreneurs. As I just said, next week we will be launching the £10 million start-up loans scheme which is specifically aimed at 18 to 24 year-olds. My colleague the Minister for Business and Enterprise in the other place, Mark Prisk, met Sir Richard Branson last week, and the issue of start-up loans was raised during those discussions. So it looks as though I have missed my chance to fly to the moon with Richard Branson but he is a wonderful role model, and more courage to him.

My Lords, is the noble Baroness aware that many young people considering taking the leap of leaving employment and starting their own business are hesitant to do so for what I consider to be the least of their troubles? They are hesitant because, for example, they are worried about how to register for VAT, how they will be able to pay their taxes and how they will pay national insurance. However, as I said, this is the least of their problems. Can the Minister consider an initiative whereby HMRC publicises in some way how easy it is to start up in business and perhaps publishes some kind of crib sheet which says that it is easy to get going?

I thank the noble Lord for that question. It is a very sensible idea. We have many things under way but I think that this is a new way of thinking in that direction. It is what we expect from the noble Lord, and I would love to think that one day we could get him to sign up as one of our enterprise champions.

My Lords, I am sure the Minister is aware that there have been some very welcome investments in the school for entrepreneurs, the Enterprise Academy and the work at Suffolk One sixth-form college in Ipswich. However, these sit alongside a disturbing and rising figure for young people not in education, employment or training. Does the Minister agree that, if more investment were put into such excellent facilities, that might have an effect on the other figure?

Yes, the right reverend Prelate the Bishop of St Edmundsbury and Ipswich is right. Everything we can do to help to build the confidence of the young in this area is very important. We have the new enterprise allowance, which helps unemployed people to start their own businesses. It is available to those who have been claiming jobseeker’s allowance for six months or more, and it provides access to business mentoring, as well as offering financial support. Very often, it is a case of having somebody to talk to who understands the situation. I am lucky that I grew up in an entrepreneurial family and therefore I grew up with the language of entrepreneurs at home. These facilities provide an enormous advantage for children who come from homes where perhaps no one at all goes out to work and where they are therefore starting from a point of terrible disadvantage. We are looking at this carefully to see what we can do to help.

My Lords, on entering the White Lion pub in Alvanley in deepest Cheshire on Sunday, my wife and I discovered that it was national sandwich week. When I asked the young lady behind the bar who had so declared it, she replied, “The landlord”. Catching that enterprise, she then declared to me that next week was to be national vegetarian week. I wonder whether the Minister could explore the opportunities for mentors and young people to come together, full of ideas, and so build the small businesses and enterprises that we so badly need in this period of recovery.

Somebody clever beside me has just said that the noble Lord was describing a sandwich course, but there we are.

My Lords, following the Minister’s comments in relation to families, does she agree that young people’s initiative can be either stifled or encouraged by their family background? In the past, there have been initiatives on family learning. Does the Minister know where the initiatives have reached and will she encourage them in the future?

I have to admit that I do not know anything about such courses but I shall look into this when I leave the Chamber. No doubt the people in the Box will tell me that I should have been able to answer the noble Baroness. This bears out what I said earlier about family background and the need to help as much as possible. We are working with schools and are even working with primary schools to see whether we can encourage parents to be more engaged with the school. Of course, it is for schools to do that but where we can help we will, and I thank the noble Baroness for the suggestion.

My Lords, we all hope that our young entrepreneurs will grow up to become employers, and the Government have invested a lot of political capital in promoting the John Lewis model of employment relations. Given that Mr Beecroft’s report has promoted a new government policy of no-fault dismissal, the Government will have to make a choice about which one of those two policies to promote. Which will they choose?

That is something to think about. Mr Beecroft was asked to give us his view because we needed to hear everybody’s view, and we have now heard the noble Lord’s view. I am very happy that we can go back and consider these things.

My Lords, following the extremely helpful suggestions from the noble Lord, Lord Sugar, I would like to ask my noble friend—as there has been quite a lot of questioning about advice for young people—what plans the Government have for developing the careers service which I believe is beginning to get under way. It seems to me that quite a lot could be achieved by giving useful advice to young people, as used to be provided through the careers service in schools.

We have certainly been reviewing the careers service. We are bringing in an all-age careers service because the need for such a service does not stop when you leave school at 16 or 18. We also realise that it needs to start much earlier than that. If we are to get people going along the path that will suit them we need to start early. I thank my noble friend for the suggestion. I hope that I can pass on to her even more information about the careers service.

EU: Euro Area Crisis


Asked by

To ask Her Majesty’s Government what assessment they have made of the effect on the European economy and financial institutions of the crisis in the euro area.

My Lords, the Government make regular assessments of the economic situation as part of the normal process of policy development. The OBR, the OECD, the European Commission, the IMF, and many others expect a euro area recession this year. As we have said, if the euro area does not definitively sort out its ongoing problems, the uncertainty that that will create and its impact on confidence across Europe will continue to have a chilling effect on Britain and the global economy.

My Lords, does not Germany bear some responsibility for problems in the eurozone in that it was Germany that turned a blind eye when Goldman Sachs fixed Greece’s books to secure its entry into the euro; it was Germany that turned a blind eye to breaches of GDP limits in the European stability and growth pact; and it was Germany that promoted the euro currency to prevent regional devaluations in neighbouring nation states, thereby protecting its own export markets within Europe? Surely Germany should show a little more flexibility in these matters.

My Lords, the key issue about Germany in relation to this Question is that we should be grateful that the German economy continues to grow. About 9% of the UK’s exports go to Germany. It is a very important market for us and it is critical both for us and for the eurozone that Germany and its economy continue to perform relatively strongly.

My Lords, does my noble friend agree that countries which, for one reason or another, have to leave the euro area could well continue to use the euro as their currency rather than inventing a new currency, like perhaps the drachma, in which markets might have little or no confidence?

My Lords, many people have been painting scenarios of which my noble friend sketches out one. This is not the time to talk about different scenarios. We want to see an early resolution of the Greek uncertainty, the ring-fencing of other vulnerable economies, the recapitalisation of the banks and work on European growth. That has to be the priority for the moment.

The Government say that the eurozone countries must take decisive action. What decisive action do the Government have in mind?

Again, my Lords, I will not speculate on the range of scenarios. Plenty of advice has been given to the UK Government, to each of the individual Governments in the eurozone and to the eurozone collectively. The important thing is to get on with it. The next major milestone will be what the Greek people decide at their forthcoming election.

My Lords, does my noble friend agree that the British Government played a very constructive role in last night’s summit meeting? Will they use their voice to persuade Germany to think again about the business of collective Eurobonds, and enlarging the firewall to make it realistic? That would be an excellent and effective way, without causing inflation, of having a lower yield overall, which would get over the nonsense that eurozone market ratings at the moment are generally lower than those of the much more heavily indebted United States of America and Japan.

I certainly agree with my noble friend that my right honourable friend the Prime Minister played a very constructive role in the discussions last night and is clearly open to a range of ideas.

My Lords, would it not be in the UK’s best interests to recognise the major differences that exist? If we are to help in any way to avoid a messy break-up of the eurozone, would it not be in our best interests to help set up some kind of scheme that would bring about the usual kind of compromise that would help at least in the short term? The noble Lord said recently that the Prime Minister was right and might agree to some kind of support for a growth fund. Does that option still exist?

My Lords, as I said in answer to the previous supplementary question, we are playing a very constructive role at the table with the 27, discussing all the possibilities for getting Europe through the present crisis—not only short-term measures that need to be taken but important questions about sustainable growth and the structure of the single market. However, fundamentally it is for the euro area countries to take decisions now about the euro area’s very immediate problems.

What does my noble friend think about the article in the Times yesterday in which the German Foreign Minister said that within the European budget there were resources that could be used to stimulate the eurozone economy, including about €80 billion which remains unspent as we speak?

My Lords, within what needs to be tight discipline—tighter than has been exhibited in recent years—over the overall European budget, certainly these ideas of targeting funds better within the existing budget envelope need to be looked at very hard.

My Lords, when the noble Lord appears next on the BBC “Today” programme, will he remind listeners that stability bonds are not mini-Eurobonds? What is the Government’s view of stability bonds, which could be part of the growth agenda that we so badly need in the eurozone area and in the EU as a whole? Would we be prepared to join in?

My Lords, as I said this morning and on other occasions in the past week, we are prepared to look at ideas. Those that are being floated include increasing the lending capacity of the European Investment Bank and issuing project bonds. We will look at these ideas as they develop.

Iran: Capital Punishment


Asked by

To ask Her Majesty’s Government what representations they have made to the Government of Iran regarding the use of capital punishment against homosexual men.

My Lords, we have been extremely clear about the human rights situation in Iran and about Iran’s excessive and cruel use of the death penalty. We deplore Iran’s persecution of, and use of the death penalty against, homosexuals. This, like many other practices in Iran, is inconsistent not only with international obligations but with common humanity. The United Kingdom has been and will remain at the forefront of international efforts through the European Union and the United Nations to encourage an improvement in Iran’s very poor human rights record.

I am grateful to the Minister for that reply. What has been the response in Iran to all the objections that we have made over the years to these thousands of executions? Is Iran ready to consider complying with the United Nations declaration of human rights? Also, what co-operation do we have with Amnesty International in these moves?

We certainly have co-operation with all the major NGOs and international movements, which are equally concerned at the horrors in Iran. It is very hard to answer my noble friend’s first question as to what impact these comments and pressures have. My personal belief is that they do have some impact. After all, we have to remember that when the elaborate EU sanctions were discussed and formulated—they are now having, apparently, some impact on Iran—there were discussions about Iran’s human rights record and the horrific rate of persecutions and executions in that country. As far as we know, this includes over 600 people executed last year and 130 executed so far this year—indeed, 60 in the last week.

My Lords, when did Her Majesty’s Government last raise the issue of human rights with Iran? When they were in full diplomatic relations with Iran, did they discuss the execution of people for their sexual orientation, of others, such as the Baha’is and Christians, for changing their religion, and of women, who are regularly publicly executed for so-called social offences? Is this not something that we should at least be making a démarche about and certainly trying to draw the international community into full unison, not just on the security questions, which we regularly raise, but on these profoundly important human rights issue too?

The answer to the first part of the noble Lord’s question is almost continuously. However, we are constrained by the fact that our diplomatic relations with Iran are now at a very low level. As he knows, there are no ambassadors between the two countries because our embassy was attacked and had to be evacuated. So far we have not got any agreement from Tehran to our request for a protecting power to look after our interests and maintain contacts. However, that does not stop us almost continuously working with the UN special rapporteur to keep this kind of horror on the UN agenda and to keep up the international pressure in every way that we can.

My Lords, I recognise that it is difficult to exert direct pressure on and have a conversation with a country with which we no longer have, for understandable reasons, diplomatic relations. I welcome the Minister’s mention of the European Union sanctions. I wonder whether, in any of the discussions, the list of things being provided by the European Union to the Iranians, alongside all the issues about the development of their nuclear capability, has been included and whether there has been any response from the Iranian Government on those items. If there has not been, would it be a moment to perhaps urge the European Union to make the discussion more comprehensive?

The discussions with Iran are going on continuously at this moment in Baghdad. They have not yet stopped; they were due to do so yesterday but the Iranian team, as I understand it, is still in Baghdad this morning. Those discussions are, of course, focused on Iran’s nuclear programme and its weaponisation ambitions, but behind them is the obvious point that the EU sanctions—and particularly the oil embargo—clearly concern the Iranians. They keep raising the issue, which is a good sign that they are worried. As to the other items to which the noble Lord referred, these will come in at the right opportunity. I cannot assure him at the moment on everything that he referred to—I am not sure whether his full list is included—but he can be sure that, within the present climate of trying to get Tehran to make some sensible concessions and to comply with the IAEA, these issues will all come up.

The figure for the executions that my noble friend gave the House is positively horrific. When did we last initiate a United Nations resolution on this subject? Could we perhaps initiate another one very soon?

There have been successive UN resolutions. We are limited by the fact that not every member of the UN Security Council is agreed on how far we should go in these affairs. I cannot answer my noble friend precisely on when the last resolution came through—I do not have it in front of me—but I shall certainly write to him giving the details that he wants.

My Lords, following the welcome judgment by the UK Supreme Court in 2010 that overturned the previous Government’s refusal to grant asylum to homosexuals from Iran, what are the UK Government doing to work with other Governments, such as that of Australia, who bizarrely still believe that it is acceptable to argue that it is possible to hide one’s sexuality?

Our position is quite clear. As my noble friend is aware, we regard all these abuses and attitudes as offensive against human rights and we would like to see them changed. We are working both bilaterally and at the United Nations on all these issues and I assure my noble friend that every opportunity is taken to make known our views and to press them on the countries concerned.

My Lords, following on from the question asked by the noble Baroness, Lady Brinton, is the Minister aware that there is a Private Member’s Bill before the Parliament in Uganda to introduce the death penalty for homosexual acts? Is he further aware that at the recent IPU Assembly in Kampala, the British delegation, of which I was privileged to be a member, had a difficult but none the less very hard-hitting meeting with the Speaker of the Ugandan Parliament, making clear how unacceptable we regard this proposal? Now that we have come home, we hope that our high commission is continuing with those representations.

Yes, I am aware. We have made it quite clear that we deplore this proposal in Uganda, as indeed we deplore attitudes taken in other African countries, including Nigeria. The answer to the noble Lord’s question is yes.

Arrangement of Business


My Lords, I hope that noble Lords will find it helpful if I remind the House that the rest of today’s debates are all time-limited. The next debate, in the name of the noble Lord, Lord Bilimoria, is limited to two and a half hours. With the exception of the noble Lord, the noble Baroness, Lady Hayter, and my noble friend Lady Warsi, all Back-Bench speeches are limited to four minutes. As noble Lords are aware, when the Clock reaches four minutes, that is the end of the time allocated. As the first Whip on duty, I hope that it will not be necessary for me to stand up at all.

Minority Ethnic and Religious Communities: Cultural and Economic Contribution

Motion to Take Note

Moved by

That this House takes note of the contribution made by minority ethnic and religious communities to the cultural life and economy of the United Kingdom, on the occasion of the 150th anniversary of the formation of the Zoroastrian Trust Funds of Europe.

My Lords, more than 1,000 years ago, a group of Zoroastrian refugees fleeing religious persecution in Iran arrived in India in what is now the state of Gujarat. The Zoroastrians asked the local king for refuge but he said there was no space for them in his land. One of the Zoroastrian priests asked the king for a cup of milk filled to the brim. The priest gently took a teaspoon of sugar and stirred it into the milk without spilling a drop. He then said to the king, “If you take us into your kingdom, we will be like the sugar in the milk: we will blend in with you but we will also make your kingdom sweeter”. The king allowed them to stay and that group of refugees, and others who followed, flourished to become India’s Zoroastrian Parsee community.

Fast-forward over 1,000 years and the Zoroastrian community is still tiny: only 69,000 people, less than 0.006% of India’s population of 1.2 billion people, and yet wherever you go in India, everyone knows who a Parsee is. Moreover, what makes me so proud as a Zoroastrian Parsee is the reputation of our community within India. When I took over as UK chairman of the Indo-British Partnership, now the UK India Business Council, of which I am president, my Indian counterpart Narayana Murthy, one of India’s most respected business leaders, said to me, “I have never met a bad Parsee”. Mahatma Gandhi said:

“In numbers, Parsees are beneath contempt, but in contribution, beyond compare”.

Over the centuries, the Zoroastrian Parsee community has excelled in every field. Today, both the Chief Justice of India and the Solicitor-General of India are Parsees. Maestro Zubin Mehta, the world-famous conductor; the late Freddie Mercury of Queen; Farokh Engineer, the great cricketer—all Zoroastrian Parsees. I could go on. In fact, I could go so far as to say that in achievement per capita, the Zoroastrian community is the most successful in the world by far. However, the community has not only looked after its own but has always put back into the wider community. It exemplifies one of my favourite sayings: “It is not good enough to be the best in the world, you also have to be the best for the world”.

The Zoroastrian faith was brought to the world by the prophet Zoroaster in around 1500 BC. It is said to be one of the world’s oldest monotheistic religions, if not the oldest, with a god, a supreme being, and the concepts of good and evil and heaven and hell. This was the religion of the largest of the ancient empires, the Persian Empire. This was the religion of the Emperors Xerxes, Darius and Cyrus the Great.

The Emperor Cyrus is of course credited with writing the world’s first Bill of Rights, the Cyrus cylinder, which is far older than our own Magna Carta, whose 800th anniversary we will soon be celebrating. The basis of Zoroastrian faith is three words: “Humata, Hukhta, Huvarshta”—good thoughts, good words, good deeds. I was the founding chair of the World Zoroastrian Chamber of Commerce in the UK. Our motto is: “Industry and Integrity”. When the most reverend Primate the Archbishop of Canterbury visited the Zoroastrian Centre recently, he explained that the word “integrity” comes from the Latin word “integrum”, which means wholeness. In order to practise integrity, you need to feel complete and whole.

During our 150th anniversary, when His Royal Highness the Duke of Edinburgh visited the Zoroastrian Centre in Harrow—a grade 2 listed building—he arrived in a Land Rover. When I greeted him, I said: “Sir, thank you for arriving in a Tata-mobile!”. Jaguar Land Rover is, of course, now owned by one of India’s largest conglomerates, the Tata Group, a Zoroastrian Parsee company. When Jamsetji Tata, the founder, set up Tata Steel over 100 years ago in the jungles of what was then part of the state of Bihar, where our company, Molson Coors Cobra, now owns the only brewery in the state, a British civil servant at the time dismissed the idea of an Indian ever owning a steel factory and said he would eat every bar of steel that came out of that factory. He has certainly had to eat his words. Now, a century later, Tata Steel owns British Steel—Corus—and is one of the largest steel manufacturers in the world.

I am proud to be the first Zoroastrian Parsee to sit in your Lordships’ House. Before I made my maiden speech, the first thing I did was to read the maiden speech of the first Indian to be elected to Westminster. Dadabhai Naoroji entered the House of Commons as a Liberal in 1892, against all odds. In fact, the then Prime Minister, Lord Salisbury, said that no British person would ever accept a “black man” as their MP. In 1895, just three years later, the second Indian, Mancherjee Bhownagree, also a Zoroastrian Parsee, was elected to the House of Commons as a Conservative. In 1922, the third—and the only one of the three Indians elected to the other place before India’s independence—was Shapurji Saklatvala, or “Comrade Sak”, who was elected as a Communist with Labour support. All three were Zoroastrian Parsees—one a Liberal, one a Conservative and one Labour. I now sit, as a Zoroastrian Parsee, as an independent Cross-Bench Peer. We have squared the circle.

The Zoroastrian Trust Funds of Europe was founded in 1861 and is now celebrating its 150th anniversary. Dadabhai Naoroji himself served as president of the ZTFE from 1863 to 1908. During this time, ZTFE functions were attended by young barristers and professionals, including none other than Mahatma Gandhi.

Earlier this year, my friend Maurice Ostro presented Her Majesty the Queen, on the occasion of her Diamond Jubilee, with a specially made necklace with symbols from the nine recognised faiths of the United Kingdom—Christian, Jewish, Muslim, Hindu, Buddhist, Jain, Sikh, Baha’i and Zoroastrian. These nine faiths are represented by the Inter Faith Network, which has been enormously successful.

The Zoroastrian community has made an enormous contribution to the Armed Forces of the United Kingdom, with my own family as an example. My late father, Lieutenant-General Bilimoria, was commissioned into the Indian army. His father, Brigadier Bilimoria, was commissioned from Sandhurst. My father’s cousin, Lieutenant-General Jungoo Satarawalla, from my father’s regiment, the 5th Gurkha Rifles (Frontier Force), was awarded the Military Cross in the Second World War, as was India’s first Field Marshal, Sam Manekshaw, also a Zoroastrian. My maternal grandfather, JD Italia, served as a squadron leader in the Royal Indian Air Force during the Second World War. I could go on with a long list of Zoroastrian Parsees who have served in the British Armed Forces. However, I am disappointed that the Department for Culture, Media and Sport has not yet allowed the Zoroastrian community to be represented at the annual Cenotaph ceremony each Remembrance Day. Can the Minister ask her Cabinet colleagues to rectify this anomaly?

I mentioned the Gurkhas. What an amazing contribution they have made to Britain over the centuries. My father’s battalion, the 5th Gurkha Rifles (Frontier Force), was awarded three Victoria Crosses in the Second World War. I am so happy that the previous Government eventually recognised this contribution, allowing retired Gurkhas to settle in this country should they so wish.

When I came to this country 30 years ago as a student from India, I was told by my family and friends to remember that if I decided to stay on and work in Britain I would never be allowed to get to the top, because, as a foreigner, there is a glass ceiling. They were absolutely right 30 years ago. Today, they would be absolutely wrong, because I have seen before my eyes this country being transformed over the past few decades into a country of meritocracy where there is opportunity for all, regardless of race, religion or background. The glass ceiling has well and truly been shattered and the ethnic minority and religious communities are now reaching the very top in every field, whether it is in sport, academia, the Civil Service or politics—just look around your Lordships’ House at the speakers in this debate who come from so many minority communities, having reached the very top in their respective fields. I am so proud of them and so looking forward to the wide-ranging perspectives that will be reflected in this debate, and the high quality of debate and contributions that I know my colleagues will bring to this discussion.

Indeed, yesterday there was a photograph taken in Westminster Hall to celebrate the 25th anniversary of the election of the first four ethnic minority MPs since the war, in 1987. From just four MPs 25 years ago, we now have 69 ethnic minority MPs and Peers at Westminster and in Parliament. This is the progress that I have been talking about. In fact, I believe strongly that in my lifetime we will see a member of the ethnic minority community become Prime Minister of the United Kingdom.

Immigrants from all ethnic minorities and religions have been the making of the “Great” in Great Britain. They have been crucial to Britain’s success, contributing enormously to the economic and cultural life of Britain and enriching it in every way by punching far above our weight. One example is the Asian community, which makes up just 4% of the population of Britain yet contributes double that percentage to our economy. Yet the Government have brought in the immigration cap—a madcap idea, and a crude and blunt instrument. Foreign students bring up to £8 billion a year in revenue into our country, both direct and indirect, yet potential foreign students are asking themselves, “Does Britain really want us?”.

I know from my experience as a member of the advisory board of the Cambridge, Cranfield and Birmingham business schools that we have seen the number of applications from Indian students, for example, plummet. This is so short-sighted when student numbers should not be included in immigration figures to start off with. Would the Minister ask her Cabinet colleagues to once again look into removing students from immigration figures? Yes, the Government need to crack down on phoney students and, yes, they need to crack down on bogus colleges, but why tar everyone with the same brush? Furthermore, foreign students bring generation-long links between Britain and their own countries. I know this, coming from a family that has been educated in Britain for three generations.

The immigration cap is also affecting business. My own business, Cobra Beer, supplies 98% of the UK’s Indian restaurants. Well over two-thirds of the country’s Indian restaurants are actually owned and run by Bangladeshis, and the Bangladesh Caterers Association does tremendous work supporting this industry. Because of the immigration cap, the industry is unable to bring in the skilled staff—the chefs—which it so desperately requires.

This industry has been an inspiration to me. It is made up of pioneering entrepreneurs who have gone to every corner of Great Britain, opened up restaurants on every high street, won customers and made friends, put back into their local communities and made Indian food a part of the British way of life. They deserve our support and our gratitude, and we must do all we can to help them. I know that the Secretary of State, Eric Pickles, has mooted a curry college. It is a great idea to train British people in the industry but it will take time. The restaurants are suffering. They need the staff and have the skills shortages. Can the Minister look into this with her Cabinet colleagues and see what can be done to help this important industry in the mean time?

I am often asked to express what Asian values are and I summarise them as the importance of hard work, family and education. Britain prides itself on being a secular and multicultural society where all religions are allowed to be practised and where all races, communities and cultures co-exist side by side. There is a word, however, that I do not like: tolerance. I believe not that all this should be tolerated but that it should be celebrated. It should be about mutual trust and mutual respect. I have spoken a great deal about the inspirational achievements of the minority and religious communities in Great Britain, but none of this would have been possible without the great opportunities that this great country has given us.

In this country, renowned around the world for its sense of fairness and opportunity for all and where the glass ceiling has been shattered, the wonderful thing is that when people from minority ethnic and religious communities do well they reach the top. Their achievement creates inspiration, which creates aspiration, which in turn leads to achievement, and the virtuous circle continues. That is the magnifying, multiplying and inspiring power of minority ethnic and religious communities succeeding in Britain. We are a tiny nation, yet we are still one of the 10 largest economies in the world, with hardly any natural resources. The one resource that we have is our people and among our people it is the minority, ethnic and religious communities who punch far above their weight. Without their contribution, Britain would not be where it is today.

The Nobel laureate Professor Amartya Sen talks about identity. He says that each one of us has not just one identity but several identities—religious, ethnic, professional and national. When I came to this country, my father gave me some great advice. He said, “Son, you are going to study abroad. You may stay on in Britain. You may live in another part of the world. Wherever you live, integrate with the community that you are in to the best of your abilities, but never forget your roots”. I am so proud to be a Zoroastrian Parsee. I am so proud to be an Indian. I am so proud to be an Asian in Britain, and most importantly I am so proud to be British.

My Lords, I thank the noble Lord, Lord Bilimoria, for tabling this timely debate and for his truly enlightening speech. It is a testament to the value of this House that so many Peers are able to represent and speak on behalf of different minority interests here today, a strength I fear the current proposals for Lords reform may eradicate forever if carried out without very careful consideration. Somewhere in our system we must preserve a means by which the voiceless can have a voice.

In the interests of time, I will speak primarily on the contribution played in British society by ethnic Chinese. In this, I declare an interest as the only active parliamentarian of Chinese origin, as chair of the APPG for East Asian Business and an adviser to several organisations involved in trade between the UK and Asia. The Chinese in Britain represent the third largest ethnic minority group and also the fastest growing one. From 2001 to 2007 the number in Britain grew 9.9% annually according to the Office for National Statistics. The population is estimated to be about 700,000, excluding tertiary students and tourists from China.

There are many diaspora Chinese, from all over the world. There are the Hong Kong Chinese, such as my parents. Many of them came in the 1960s through to 1997. There are the British-born Chinese, such as myself. There are the Taiwanese Chinese, the Singaporean Chinese, such as the late Michael Chan—the much-loved physician who served in this House—the Malaysian Chinese, the Vietnamese Chinese, the Mauritian Chinese and the mainland Chinese, including those who have recently arrived and who are often highly educated and affluent.

Without their necessarily having shouted about it from the hills, it is important to recognise that the Chinese who live, study and visit here contribute a huge amount to the UK. That might be in the Chinese catering industry, which employs in excess of 100,000 people and contributes £4.9 billion to the economy; or in the 200,000-odd students who, during and after university, contribute to our economy through educational fees; or the many professionals of Chinese origin who work in the City and around the country. Whether in the large numbers of wealthy tourists who come to purchase British goods and services, or in the networks of diaspora investors and their firms who are investing billions in our economy and creating thousands of jobs, or in their general law-abiding contribution to our cultural life, the role of the Chinese in British society cannot be ignored.

There are more opportunities for the Chinese to play an even bigger role in British society. First, I and others would like to help train more up-and-coming Chinese living and visiting these isles to develop socially entrepreneurial skills so as to take up a more visible and integrated role in British society. I would like them to be more engaged in informed political debate and to come up with solutions to the issues that the community faces. These can help create jobs, tackle ignorance, and address social ills for other groups and the public at large.

Secondly, there is a significant untapped opportunity for the Chinese to help positively to influence the British education system, not only because they often perform well at school, but also because of more British people’s hunger to learn about Chinese language and culture.

Thirdly, given the significant numbers of Chinese involved in the professions and in trade with east Asia, there is a role for the British Chinese in helping British and Chinese firms connect and do business together across the cultural and linguistic divide, whether as workers, or on management, or on boards. That will create jobs and prosperity at a time when we most need it. To grasp these opportunities fully, we will need the help and understanding of parliamentarians, the public and government.

In closing, I shall ask the Minister, whose work in this area I greatly respect and admire, the following questions which I know matter in our particular community. What can we do to keep policy on immigration and visas balanced so that we can continue to trade with and access talent and skills from the East while rightly protecting our borders? What is being done to help to tackle ongoing prejudice and fear towards Chinese people in the media and at large? What is being done to harness local British Chinese in building trade with east Asia? How can we harness Chinese learning methods and speakers more in our education system? What can we do to help to mentor the next generation of Chinese British leaders to be more involved in our public life and party-political system when many are underrepresented at present due to the widely dispersed nature of the Chinese across the British Isles?

My Lords, the noble Lord, Lord Bilimoria, made a superb speech. Like him, I am proud to live in a country that has diversity at its very core. The hands that built this country have come from every faith, every continent and every culture. Some of those who helped lay the foundations were members of the Zoroastrian faith—those who used their faith as a tool for good in the world. They are a creative, courageous, entrepreneurial, industrious people who have made, and continue to make, a huge impact on our lives. I pay particular tribute to one, Zerbanoo Gifford, a tireless campaigner for justice and human rights and a passionate advocate for democracy and women’s empowerment. She is the founder of the Asha Centre in the Forest of Dean. “Asha” means “hope”. It is a place of many faiths and cultures, a haven of peace and beauty where people, especially young people, from Britain, the European Union and the rest of the world come together to learn about conflict resolution. Arab and Jewish Israeli young people spend time with each other then go home united rather than divided. It promotes volunteering. The centre fosters community participation through a programme of projects, arts and working on the land encouraging young people to celebrate their similarities, not their differences. Young people, united by the strength of their common endeavour, work together for a better future in which we celebrate our differences as well as our similarities.

I believe that politics and democracy have a huge role to play in ensuring greater community cohesion. Sadly, a certain breed of politics thrives on tearing communities apart. The politics of division are not the politics of progress; they are the politics of fear and political expediency. Democracy must be nurtured by political participation, but that participation depends on trust, communication, a sense of hope and the breaking down of barriers and prejudices within our communities. I am alarmed and ashamed that only 30% of our electors thought it worth voting in the recent local elections. It was a real indictment of all political parties. They must reach out, be more inclusive and not be afraid to address difficult issues, such as immigration, that are of real concern to all communities, including minorities, and they must address issues such as visas for foreign students. I endorse the points made by the noble Lord, Lord Bilimoria.

There are many terrific initiatives up and down the country which are building trust between and within communities. I am proud to be an ambassador for UpRising, a charity which fosters the leadership qualities of young community leaders and ensures that they nurture understanding between their communities. I pay special tribute to the Speaker’s parliamentary placements scheme, which ensures that interns from all backgrounds have an opportunity to work within the Houses of Parliament. The myriad initiatives are often inspired or run by religious communities, and they pave the way for an even more diverse culture and an end to tribalism and the prejudices of the past.

However, barriers still remain. They are sometimes real, sometimes perceived, a consequence of fear rather than fact. While campaigning during the recent elections in the tower blocks of Westminster North, I ran into a group of young people in the stairwell wearing hoodies. I talked with them quite happily, but as I walked into the street I was stopped by someone who asked me what on earth I was doing chatting to those dangerous young people. That was someone choosing fear over hope, not hope over fear. For too many people, hope is lacking and without hope, people put up protective barriers.

We all have a responsibility to break down these barriers, including the Government. The big society is not enough; economic growth, jobs and the dignity that comes from work are an integral part of ensuring a diverse and harmonious society. With work comes confidence to reach across and into other communities. Without work the health of individuals and communities suffer. When communities wither and die, a vacuum is created, and in that vacuum extremism spreads.

The voluntary sector is a key part of a thriving community, but as the cuts in local government finance bite and the state withdraws from some of its responsibilities, we rely ever more strongly on the voluntary sector and charities, many of which are faith-based. Notwithstanding their ever-increasing burdens but diminishing budgets, they manage to provide a safety net for many of our citizens and sustain local communities, but they can be stretched only so far.

My Lords, I add my thanks to the noble Lord, Lord Bilimoria, for this debate. The Zoroastrian community is small, yet has made a significant contribution towards the economic development of the countries in which it has settled. Its members have also excelled in other diverse areas of our civic life. Their diversity, supplemented by their culture and faith, has added richness to our multi-racial, multi-ethnic and multicultural society.

History throws an interesting light on the Zoroastrian community, and I am glad that the noble Lord, Lord Bilimoria, has spelt this out. We now know that there are around 250,000 individual Parsees worldwide, and some 5,000 in the UK. Zoroastrians are a small but significant minority, setting an example of tolerance and diversity. We have long cherished and considered the development of a value-driven society as a core goal. Over the years, there has been a confused debate about multiculturalism in Britain. We often shelter under expressions like, “community cohesion”, a concept which, to my mind, lacks strategic thought. Some argue that it is important to articulate a shared sense of national identity in contemporary conditions of flux and change. If so, how can we reconcile this with diversity, openness and pluralism of belief and practice?

We should look no further. The Zoroastrian community is an example we could all follow. Fixed notions of shared identity, even if they could be agreed on, are less necessary than promoting individual identity, pluralism and genuine multiculturalism. We should be proud of Britain's record in race and community relations. It is now a few decades since the establishment of the Race Relations Act 1965. We have been at the forefront of legislative and other machinery to establish equality of opportunity for all our citizens with a strong emphasis on disability, gender, age, faith and sexual orientation.

We now need to move to the next stage. We need to examine changing patterns within all our communities. True multiculturalism is proactive and means that equality and diversity is at the core of everything we do, from government to individual responsibility. We need to take a much more pro-active stance towards combating racism and discrimination, really tackling inequality in all aspects of our society in social and economic matters and in civic participation, positively valuing—not merely tolerating—the contribution of different cultures and perspectives, and treating them with respect.

Increasingly, the globalisation of the economy relies on the skills of people wherever they are available, and international migration is a key feature of ensuring that Britain benefits from the phenomenon. We have seen a steady development of the concept of human rights and the very positive step of incorporating the European Convention on Human Rights into UK law through the Human Rights Act 1998. For too long we have simply assumed that our liberties are protected by a set of traditions and customary activities assisted by a general consensus within our society about the liberty of individuals. The Zoroastrian community demonstrated that common values cannot and should not be assumed in a multicultural society. The cosy assumptions of a homogeneous consensus in which we rooted our liberties simply will not do. Cultures do not remain static. Communities change. Conflict often occurs of matters of gender, generations, religion, language and the community's relationship with the wider society.

There is nothing to be frightened about. We are already witnessing fusion in music, arts and fashion. These new emerging cultures will be exciting. Equally, the emerging third, fourth and fifth generations are British to the core. Let us accept this. In years to come, we shall ask the question, “What was all that fuss about multiculturalism?”.

My Lords, I thank my noble friend Lord Bilimoria for securing this debate and for the fine speech with which he opened it. I declare an interest as the chairman of both the British-Irish Association and the Anglo-Israel Association. I will speak briefly under both headings.

It is easy to make a case for the Irish contribution to the cultural and economic life of the United Kingdom, particularly in this Chamber, where two of the great Paintings, Daniel Maclise’s “Spirit of Justice” and “Spirit of Chivalry”, look down upon us. Of course, the two great Paintings in the Royal Gallery are also the work of Daniel Maclise from Country Cork.

It is well known in this House that no medium-sized city in Europe has produced as many Nobel prize-winners in literature as Dublin. These things are widely understood. Perhaps less widely understood is the role of Ireland now in the economic life of the United Kingdom. We now have significant Irish employers such as Glen Dimplex, Kerrygold and Greencore, which all play a significant role in the employment opportunities of this island. When the two economies are so deeply intertwined at this moment of peril, it is worth stressing the positive contribution that Irish employers make to the United Kingdom.

I turn briefly to the Jewish community, which owes so much to King Cyrus, who was mentioned in the speech of the noble Lord, Lord Bilimoria. It is appropriate to turn to that community. Ever since Perry Anderson published his famous article Components of the National Culture 40 years ago, there has been widespread understanding of the incredibly important influence of the Jewish community on the intellectual, artistic and scientific life of this country. The role of the Jewish community is widely understood. I refer briefly to a historic figure, Sir Montague Burton, who endowed so many chairs in my own field of study as an act of generosity.

I lead on to say that it is tremendously important to understand the scale of the philanthropic activities of the Jewish community today, particularly in the treatment of degenerative diseases such as Alzheimer’s and Parkinson’s. The role of the Jewish community in raising money for research in this area is absolutely remarkable, and in a debate of this sort it is worth drawing attention to such a development.

I conclude by referring briefly to one of the United Kingdom’s oldest Muslim communities, the Ahmadiyya, and to something that many in your Lordships’ House will have noticed in recent days—the remarkable, huge sponsored charity walk that the Ahmadiyya held in celebration of the Diamond Jubilee. It is a remarkable indication, yet again, of this country’s ability to inspire that sense of citizenship and generosity, which we are so fortunate to experience.

My Lords, I offer just a few quick thoughts in my role as one of the two co-chairs of the Inter Faith Network. I am most grateful to the noble Lord, Lord Bilimoria, for his gracious affirmation of the work of the network, which serves the great faith communities and those interested in relations between them by doing two things. It invites people to work together and appreciate one another and encourages us to work together for the common good. A recent manifestation of the fruits of that work is the development of Inter Faith Week, which will be in November. The Government have generously supported us by making that happen. I hope that the Minister might reassure us about a continuing commitment to enabling that manifestation of the riches of faith communities working together for the common good. It is lovely to see some of our colleagues from the Inter Faith Network in the Gallery.

The Zoroastrian community makes an outstanding contribution to this work of interfaith relations and service to our communities. When the most reverend Primate the Archbishop of Canterbury visited the community, as the noble Lord, Lord Bilimoria, mentioned, he explored very creatively the way in which the Zoroastrian community, although small in number, has had, as he said, a vocation throughout history to help different perspectives, cultures and religions interpret themselves to one another. That is part of the power of the noble Lord’s nice image of the sugar and the milk. It is true in Iranian and Indian contexts, and I can testify to the Zoroastrian community’s contribution in our own context today, helping that sweetness and improving the quality of relationships. The community is small in number but very effective.

Those of us who are privileged to lead Prayers in this place often receive requests for the Psalm that begins:

“I will lift up mine eyes”.

That indicates to me a deep instinct in all of us, with varying degrees and various sources of faith, for a recognition that there is something in our hearts that seeks what we would call “the transcendent”—a greater horizon and a greater possibility than we can grab, tangibly, in this life. Yet it motivates us to set out as the noble Lord described in the foundation of Zoroastrianism and the way in which it has developed.

We need to take seriously that faith and desire for a greater horizon, a greater connectedness, as deep in all human hearts. I hope that the Government will continue to recognise the importance of faith in that spirit and the bigger horizon that it offers, and continue to support organisations, such as the Inter Faith Network, which seek to encourage that spirit in which there is a hopefulness and a trustfulness that our world so badly needs when division is so magnified and so destructive.

I thank the noble Lord very much for sponsoring and introducing this debate, and for his very powerful and helpful speech. I congratulate him on this wonderful 150th anniversary.

My Lords, I congratulate the noble Lord, Lord Bilimoria, on initiating this debate. He has chosen to hold this debate on the 150th anniversary of the Zoroastrian Trust Funds of Europe. One of the earliest patrons and founder of the funds was also the first Asian Member of the House of Commons— Dr Dadabhai Naoroji was elected in 1892. He, along with Sir Mancherjee Bhownagree, elected in 1895, and Shapurji Saklatvala, elected in 1922, are known as the original trio of British MPs of Indian origin, and they all followed the Zoroastrian faith.

Today, we have a number of British parliamentarians from the ethnic minorities and, yesterday, a photograph was taken of them in Westminster Hall. We would of course like to see our numbers augmented. The contributions made by ethnic and religious minority communities are evident all around us in every facet of our lives. Perhaps one of the most obvious cultural examples is in our modern-day choice of food. Asian food has become a staple part of the British diet and numerous surveys have reported Chinese and Indian dishes as becoming the most frequently cooked meals in the United Kingdom. The first Indian restaurant in the UK was opened in 1812 here in London and seemingly began a culinary revolution.

In terms of our media, Bhangra music, originating from the Punjab region of India, has become increasingly popular in the United Kingdom over the past 20 years. I may add that the late Freddie Mercury of the rock band Queen was born in Zanzibar and belonged to the Zoroastrian faith. In sport, Prince Ranjitsinhji of India has become one of the most enduring names in English cricket. In 1899, he became the first cricketer to score more than 3,000 runs in one year and was the first Indian to play Test cricket. Today, there are stars from various ethnic backgrounds in our national games and sports.

One of the more important contributions that the minorities have made to our country has been to the medical profession, both in research and as doctors on the front line. Some 19% of our doctors are of Asian or British Asian origin and more than 10% of our doctors were qualified in India. In addition to the medical profession, people from the ethnic minority communities have excelled in a number of other professions.

In regard to the economy, the ethnic minorities have been successful in the business world. The UK’s rich list includes a number of persons of foreign extraction, including people in the manufacturing, retailing and service industries. In addition to multimillionaires, there are of course persons who are owners of SMEs. They have all created wealth, employed staff and paid taxes. I have a close connection with the City of London where I know people of ethnic minorities who are doing extremely well in the square mile.

I also want to pay particular tribute to the contribution of our minorities to our Armed Forces and the police service. These communities made significant contributions fighting for our country through two world wars. Today we see them in the military and the police at senior levels, developing and maintaining our security on an everyday basis. I maintain close links with the Armed Forces Muslim Association and have been assured by its patron, Sir David Richards, that promotions in the Armed Forces will be based purely on merit.

We celebrate religious freedom in this country. There are now hundreds of mosques, temples, gurdwaras and synagogues in the UK, which I think evidences just how entrenched our minority communities are in the country. Our tolerance and diversity is a flagship characteristic of our country’s heritage and the envy of much of the world, and long may it continue.

My Lords, this was a brilliant idea for a debate, and I hope that the noble Lord, Lord Bilimoria, conveys the congratulations of this House to those shouldering responsibility for the Zoroastrian Trust Funds as they go on to their next 150 years.

I came to the House this morning after counting 40 flags that we have just bought in the church of which I am a minister—they will be hanging out for the jubilee next week. There are people from 40 different nationalities in my congregation. John Wesley said that he looked on the world as his parish; the world has taken him seriously, and has come to live in his parish, and a very brilliant thing it is, too.

I say 40 nationalities, but out in the community it is more than that. In the school of which I am a governor, there is more than twice that number, because you can throw in faiths and other differences, in a diversity that is truly mind-boggling. Why do people think that this is a problem? Why do they not see it as a challenge and—if they have the stomach for it—something that will open their eyes to a dimension of life and human living that they have not known before? It is absolutely wonderful to live in a diverse country. When I go back to my native Wales now and see the same tired old faces, I want an injection from the ethnic minority groups to be liberally applied to the community that I grew up in. So this should not be a problem and, if the press portrays it that way, everybody in our Parliament should be working hard and recommitting themselves to changing the attitudes that prevail out there.

Writers from Edward Said to Homi Bhabha have shown how the British majority population has dealt with the minority peoples who have come our way—first as those who bring quaint, lovely and interesting things for us to look at, smell, see and taste. But it cannot stay there. We go on to intellectualise the matter, to catalogue the things that distinguish us from them. It is a way of othering the other and keeping them objectified, which is certainly what Edward Said said in spades. We cannot leave the matter there; we must know more about each other, but that is not what living together is all about. The vocabulary that has been generated by post-colonial literatures has been about hybridity, overlap, third space, in-betweenness, where we actually live an integrated life alongside each other, stimulating each other and enjoying each other’s company, celebrating diversity.

One thing about this debate is that I wish that every single member of a minority group who was a Member of this House were present today and sitting down and not making a speech so that they could give the opportunity to those from the majority ethnic population to congratulate them on their contribution to British life and assure them that together we can make Britain an even greater place than it has been. I certainly want my voice to be raised this morning in that sense.

As I come to the end of this gruesome, tiny 240 seconds that is afforded me, let me just say that when we process the flags, as eventually we will, we will ensure that people do not carry the flag of their own country. Our people will carry flags for each other to suggest that we belong to a multicultural country, are proud to do so and want to parade that fact for everybody to see.

My Lords, it is always an inspiration to listen to the noble Lord, Lord Bilimoria. He has done a great service to the House in achieving this debate. As he spoke of the good thoughts, good words and good deeds, what struck me was how clearly he was describing the importance of fundamental principle and of faith in the production of a successful community, as the Zoroastrian community and the Parsee community are and have been for such a long time.

The noble Lord, Lord Bew, like me, comes from Ireland. While listening to him, I was also struck by how some Members of your Lordships’ House might find it strange that he spoke of the Irish as an ethnic minority. I am afraid that the truth is that, in the last century, there were still posters on doors of boarding houses saying, “No Irish or blacks”. If we go back to 1828 when Daniel O’Connell was elected to the other place, he was unable to take his seat because he was a Catholic. That was changed because His Grace the Duke of Wellington, the Prime Minister, realised that it was no longer acceptable. Because the change was made for the other place, His Grace the Duke of Norfolk was able to come into this place even sooner, and that meant that Presbyterians could come into these Houses. By 1858, the Jews Relief Act meant that Jews could come into the House. The point is that once we start opening our minds to the opportunity for a multiracial, multifaith community, there should be no end to the route down which we go. As my noble friend Lord Dholakia said, it should eventually become so natural that the Irish are not considered an ethnic minority, and Catholics are not regarded as a faith minority, because we are all part of the same community.

But we need to think our way through this, because it is not quite so simple. Other countries have developed a different cultural approach by setting some of the diversity out of the public sphere. For instance, our friends in France have a culture of laïcité, which effectively says that religion should be kept out of the public space as much as possible. That is not our culture. Our culture is to value religious faith and to keep it available in the public space. From my experience in my part of the United Kingdom, I am absolutely convinced that valuing and keeping open the space for ethnic-minority groups, religious faith and other elements of our community life is important. The noble Lord, Lord Wei, mentioned Hong Kong Chinese, and of course the Northern Ireland Assembly is where the first ethnic-Chinese parliamentarian in the whole of Europe—Anna Lo—was elected, in 2007, and re-elected with an even greater majority in 2011. These are valuable developments but we should never accept the right to dismiss the human rights of others, or become tolerant of the intolerance of some cultures, or we will lose what is most valuable in our variegated society.

My Lords, I too congratulate the noble Lord, Lord Bilimoria, on having secured this important debate and on his thoughtful introduction to it. I take the opportunity afforded by the debate to draw your Lordships’ attention to the important contributions made by healthcare workers and doctors from the Indian subcontinent to the delivery of healthcare in our country. In so doing, I declare my own interest as consultant surgeon at University College Hospital in London and professor of surgery at UCL.

It is well recognised that, since its inception in 1948, the National Health Service has been dependent on the dedicated service and contribution of a wide range of communities, many from overseas, to ensure that healthcare can be sustained and delivered to all parts of the country. It is clear that, without those important contributions, not only the delivery of everyday care but many important advances in biomedical research and developments in our healthcare system would not have been possible.

I am the son of two doctors who completed their medical education in India and came here to the United Kingdom to complete their further education and training in 1961. They were able to come here because of a long-held national consensus that has welcomed those from a diverse range of communities who are prepared to come here, integrate and make a contribution to society more broadly. In return they were given opportunities to advance themselves. My mother continued to practise as an anaesthetist. My father was a professor of surgery and undertook fundamental research to identify the problem of thrombosis blood clots that occur in patients after surgery. He developed methods of preventing post-operative thrombosis that have changed clinical practice and saved the lives of many hundreds of thousands of patients around the world.

Contributions have been made in many other areas. Many from the Indian subcontinent made a contribution by going into general practice in difficult and deprived areas and delivering dedicated service. One of the great challenges our healthcare system now faces as these practitioners retire is how we continue to ensure that universal healthcare is provided in all parts of our country.

However, many people went back home to India and other parts of the Commonwealth where they made important contributions. What they learnt in our country drove them to adopt systems, technologies and outputs from the United Kingdom. Therefore, our life sciences and healthcare industries had a huge influence in the Commonwealth and the Indian subcontinent as a result of the training that those young doctors received in our country. As our national gaze turns more to the European Union, what arrangements will be made to continue to encourage medical trainees from the Indian subcontinent and the Commonwealth to come and complete their training here? How will we ensure that those opportunities are not lost so that those trainees go back to their countries fully understanding the great contributions that our own country has made to healthcare and promoting our life sciences industries in their countries? How will we ensure that the broad diaspora of doctors and other healthcare professionals from the Indian subcontinent are able fully to engage and promote our healthcare and life sciences industries in India and other parts of the Commonwealth? We should not forget that some 44,000 out of 240,000 registered doctors in the United Kingdom declare themselves Asian or British Asian—some 19%. It is vital that the resources which these fellow citizens bring are fully engaged to promote opportunities for British healthcare around the world.

My Lords, I join others in congratulating the noble Lord, Lord Bilimoria. I do so on three fronts. First, I congratulate him on initiating this most vital debate which celebrates the contribution of all communities to Britain. Secondly, I congratulate him on the 150th anniversary of the Zoroastrian trust funds and, like other noble Lords, I congratulate the Zoroastrian community on that achievement. Thirdly, I congratulate the noble Lord on his personal contribution not just to this Chamber but to the country and business community at large. I assure him that I speak on a factual basis when I say that he is an inspiration to many youngsters from all communities and backgrounds in our country.

As the noble Lord, Lord Bilimoria, said, if you glance at the list of speakers, you will see that there are speakers not just from some defined minority communities but from all communities. That is what Britain represents today. The strength of our diversity is evident. A speaker who is to follow me shares my surname and another comes from Wimbledon, like me. Noble Lords speaking today are testament to the dedication, devotion and commitment shown by many communities throughout the country, and indeed by former generations such as people of my parents’ generation who made Britain their home and were willing to work hard. To my mind the most important point is that their success truly reflects the incredible country in which we live.

As we celebrate and recognise the contributions of different communities, particularly the Zoroastrian community, and the contribution that faith has made to Britain, we should also pay tribute and recognise the fact that our country is one where opportunity, progress and perseverance are rewarded, where freedom of religion is not just protected but promoted, and where the strength of our country is evident in the diversity of what Britain is today.

I wish briefly to focus on two elements—first, in terms of my professional background in business and the City. Glass ceilings, as the noble Lord, Lord Bilimoria, said, have been broken. Look around the Square Mile and you will see the diversity of our nation in the people who work in that most important of London areas— not through regulated quotas but by an evolution in our society, a meritocracy and sheer hard work.

Secondly, as a Muslim in Britain, I consider Islam to be under the microscope, and often headlines are made because of the work of splinter and radical elements who present Islam in a negative and erroneous way. It clear that there are many Muslim communities in Britain—including my own, the Ahmadiyya Muslim community—that demonstrate not through words alone but through actions that they are not just law-abiding citizens but active and productive contributors to the economy and welfare of our society. Therefore, as we rightly condemn those who burn flags on the return of our brave troops, we should also recognise the efforts of Muslim communities such as mine, whose youth groups have raised thousands of pounds through poppy appeals and, indeed, as the noble Lord, Lord Bew, said, have most recently celebrated Her Majesty’s Jubilee by raising a quarter of a million pounds for British-based charities.

Like other Peers, I recognise that all communities serve actively on the front line. They serve their Queen and country. Today, as the world focuses on London, with Her Majesty’s Diamond Jubilee and the arrival of the Olympics, from churches to synagogues, from mosques to temples, and from gurdwaras to community centres—indeed, in every street in every home across Britain—let us raise a glass, say a prayer, or in some cases both, to celebrate these two historic occasions, and also our country and people who make Britain the absolutely incredible place that it is.

My Lords, I, too, thank the noble Lord, Lord Bilimoria, for providing us with the opportunity to speak in this debate. I join the noble Lord, Lord Ahmad, in praising the work of the noble Lord, Lord Bilimoria, particularly his distinguished career and successful business story, and for making a huge contribution to our economy and Exchequer. I am grateful for the contribution made by the Zoroastrian Parsee community from India to the UK.

It is unfortunate that much of what we hear about ethnic minorities is of a negative connotation. Some tabloid newspapers have a habit of focusing on the bad and rarely mention the good. But then they say, “Bad news sells”.

There is no doubt in my mind that Great Britain is one of the greatest nations in the world, and the prefix “Great” is there for a reason. Britain takes great pride in the way it treats its citizens and the equal opportunities it provides to them all. However, it is important to mention that my father’s generation and many who came to the UK in the early 1950s and 1960s did so for a particular reason—it was an interdependent relationship. Britain was in urgent need of a labour force to rebuild its post-war economy and labourers needed an excuse to come to the motherland. However, there is one outstanding fact that is seldom mentioned; most of these labourers came from provinces that had played an instrumental role during the two world wars.

My knowledge of history has improved tremendously thanks to military historian Jahan Mahmood, who has conducted an in-depth study of the contribution of Muslims from the British colony of India since 1914. I am grateful to him. At the beginning of the First World War, the only regular army available to Britain was the British Indian Army. Over a period of four years, the Indian Army expanded from an organisation of 155,000 soldiers to become a colossal 1.2 million-man force. By the end of the war, Muslims constituted a third of the overall army, and the Punjabi Muslims forged the largest single ethnic class within its ranks. To be exact, there were 136,126 Punjabi Muslims, 88,925 Sikhs, and 55,589 Gurkhas. The remainder of the Indian Army consisted of Hindu soldiers numbering around 300,000, followed by minority groups, including Christian Indians and Parsees, among many others. India’s material and financial contribution to the war is placed at a staggering £479 million.

Similarly, during the Second World War, 2.5 million south Asian soldiers participated. The ethnic composition was as follows: 700,000 Muslims, 900 000 Hindus, 150,000 Sikhs, 120,000 Gurkhas and 90,000 Indian Christians. The financial contribution is estimated to be £1.3 billion and the human cost was 80,000 men.

I now turn to the present-day contributions. I do not have the latest figures, but, according to a speech in 2008 by the former Home Secretary, the right honourable Jacqui Smith, the Muslim contribution to our economy was over £31 billion pounds per annum and there were more than 10,000 millionaires who contributed to our Exchequer. I would be obliged if the Minister in her reply could state the latest figures in relation to the contribution made by the Muslim community—£4 billion from the curry industry alone. It is also estimated that 23% of employees in the National Health Service are of Asian origin. There are many more figures, but time does not allow me to give them.

My Lords, I thank my friend, the noble Lord, Lord Bilimoria, for initiating this debate, which is very important and highlights the contributions of the minority ethnic communities in the United Kingdom.

Let me start by saying that yesterday I took part in a photograph session in Westminster Hall. There were 40 Peers and MPs from both Houses. As noble Lords have already heard from the noble Lords, Lord Bilimoria and Lord Sheikh, there were only four such Members 25 years ago. I am sure your Lordships’ House will agree with me that that in itself is a testimony to the huge contributions made by the people of ethnic minority origin in this country.

Ethnic minorities, found in all walks of life, have integrated into the society in which they live by taking opportunities, utilising their skills and making their own mark on society. Here I might add that the noble Lord, Lord Bilimoria, is an example of one of those who has made his own mark, in his own way, on his own Parsee community, with which he is involved.

Contributions have been made in every sector from religion, business and professions such as the law, accountancy, medicine, and of course philanthropy and politics. As we are restricted to speak for a short time in this debate, it is not possible for me to talk about all those sectors. However, I would like to make a point on business. There are many people who contribute, from those on news stands and in small corner shops to multinational corporations. Examples are my local shop, which is run by a Gujarati, and the Tata Group, which owns Jaguar Land Rover, Tetley Tea, TSC, Corus, and many other businesses. The benefits enjoyed from gainful employment and remuneration are enormous, and aid the growth of the economy.

I, too, have contributed in a small way through my own company, Rinku Group. Here, I wish to declare an interest. My company started in 1964 from a market stall in the market town, Widnes, with only me and my wife, and is now a respectable fashion business with more than 300 concession retail outlets employing some 400 staff in this country. It is hard work, but at same time the opportunities offered by this country are tremendous in promoting and helping people to start up businesses that can grow to provide employment and security, as well as contribute to the communities that they are involved with through charitable giving.

However, this progressive assimilation of minority ethnic people is a wealth that is measured not in pounds and pennies but in enrichment, enlightenment, integration and a uniting of different cultures within the local community in which they live and work. This is a solid foundation on which to move forward, taking with it a new generation, who, shaped by this evolution, can surely bring further advances and benefits to the cultural life and economy of the United Kingdom.

My Lords, I, too, congratulate my noble friend Lord Bilimoria on securing this debate, as well as on his brilliant and inspiring speech.

I begin with a brief personal comment that illustrates the rapid rise of our different faith communities in Britain. I grew up in a part of the Midlands where we were the only non-white family. The same area is now home to substantial minorities of different faiths and cultures.

Many will recall that in the 1950s and 1960s shopping hours were rigid and limited, and customers would receive hostile looks if they entered a shop just before closing time. Then suddenly, thanks to the enterprise of new faith communities, everything changed and we had corner shops open until late at night, well stocked to meet the needs of those who worked unsocial hours, or those who suddenly discovered that they had run out of milk or bread. I remember one shop where a young lad would do his homework between serving customers. He is now a university professor. Inherent business skills also began to flourish, with corner shops giving way to large wholesalers, supermarkets, hotels and even hotel chains, and the growing popularity of Indian cuisine has added spice to an otherwise staid British diet.

As we celebrate the 150th anniversary of the arrival of the Parsee or Zoroastrian community in this country, we reflect with admiration that some of the most important innovators are members of that highly enterprising community. The Tatas are significant players in steel, car production and much else. Among many others, we have the Cobra Group of my noble friend Lord Bilimoria, which is doing much to quench the nation’s thirst.

Turning to my own community, Sikhs have become one of the wealthiest and most successful communities in Britain, with the average household income being second only to that of the Jews. The contribution of the community has spread to many different activities. If you look on the back of a bus or travel by tube train, you can hardly fail to notice the advertisements for Vitabiotics, a vitamin supplement company owned by a Sikh, Dr Kartar Lalvani. In sport, we have the Olympic torch bearer, Fauja Singh, who is 99 years old, and Monty Panesar and Ravi Bopara regularly make it into the England team.

The one area in which Sikhs have not made the contribution that I believe we should have made is in furthering interfaith understanding. Perhaps I may explain myself. To my mind, interfaith dialogue in this country has lost some of its momentum, with representatives of different communities being superficially nice to each other but not doing more to enhance understanding and social cohesion. The difficulty in moving to constructive engagement lies in the balance between reaching out to other communities with different beliefs while preserving our own distinct religious integrity. I believe that Sikhs are ideally equipped to revive the momentum. A religion that includes the writings of Hindu and Muslim saints in its holy scripture, the Guru Granth Sahib, to show that no one faith has a monopoly of truth, can and should be playing an important part in reconciling different faiths and cultures. While Sikhs can count successes in other fields, our report card here reads, “Can and should do better”.

In conclusion, my hope and belief is that our different communities will build on their achievements and make Britain a showcase for the world in enterprise, tolerance and understanding.

My Lords, I, too, am most grateful to my noble friend Lord Bilimoria for calling this timely debate on the 150th anniversary of the formation of the Zoroastrian Trust Funds of Europe. In a recession of this gravity, it is right to look at the inspirational leadership that ethnic and religious minority communities have shown, particularly in establishing vital public institutions. I listened particularly closely to the noble Baroness, Lady Royall, when she spoke of the ASHA Centre, established by a Zoroastrian Parsee. I also remembered that the noble Baroness, Lady Corston, in her report on women in custody, noted the important work that the ASHA Centre did in allowing mothers to keep in touch with their children, rather than being removed into the secure estate.

I wish that my father could be in his place today. As the last Secretary of State for India and Burma, as a Minister for the colonies at that time and as the last Governor-General of Ghana, I am sure that he would have taken particular pleasure and interest in our debate today.

I should declare my interest as a trustee of the Michael Sieff Foundation and as a patron of the Who Cares? Trust, YoungMinds, and Volunteer Reading Help. I am also an officer of the All-Party Parliamentary Group for Looked After Children, chaired by Edward Timpson MP.

I should like to speak of a minority and how its needs have too often been overlooked, with appalling consequences for that minority group, and how the foundation of a new institution might secure the group’s future. The minority I am speaking about are the 4,040 children in children’s homes in this country, 1,300 of whom are girls. The need that has too often been overlooked has been their need for the most expert and nurturing care. The appalling consequences have been the historical abuse of children by staff in children’s homes and the current apparent failure of some children’s homes to protect girls as young as 12 and 13 in their care from predatory men. The Times of Wednesday 9 May had local authorities recording 631 incidents of girls from children’s homes being sold for sex during the past five years, including 187 in the past 10 months.

The new institution that might secure their future is a centre for excellence for looked-after children. The Scots established such an institution several years ago. Set in the University of Strathclyde, the Centre for Excellence for Looked After Children, formerly the Scottish Institute for Residential Child Care, provides training and research, and influences policy. It is currently funded to the tune of £3 million per annum by the Scottish Government.

I suggest that those of us who are particularly concerned with the welfare of children might assist in establishing a similar institution in this country, following the example of the Zoroastrian Parsee and other minority communities in establishing such important institutions. Some £100,000 has already been offered towards securing such an endowment to a university. Will the Minister take back to her colleagues this suggestion of establishing such an institution in one of our universities, dedicated to residential childcare and to supporting foster care and funded jointly by endowment and government investment?

Important improvements have been made by successive Governments in building capacity in children’s homes and in strengthening regulation. In recent years, Ofsted has reported improving quality in the care provided. However, those of us who know the sector know that the fundamental problem has not been addressed. The most vulnerable and challenging children in this country are cared for by workers who too often lack appropriate professional development and are often poorly paid. Research by Professor Pat Petrie and Professor Claire Cameron at the Thomas Coram Research Unit found that staff on the continent are far more highly professionally equipped, yet they also deal with children with far lower levels of need.

I have spoken for too long, but I hope that the Minister will take back these concerns to Tim Loughton MP, the Minister responsible in this area, and I look forward to her response to the debate.

My Lords, I, too, thank the noble Lord, Lord Bilimoria, for bringing this debate before the House. I start by paying tribute to the Zoroastrian community, both in the UK and elsewhere, for its enduring values. In India, it is an incredibly well respected community, living peacefully side by side with other faiths. There are many parallels between Zoroastrianism and Hinduism—my own faith—and the noble Lord, Lord Bilimoria, is one of many Zoroastrians that I am fortunate to call a friend.

I wake up every day and consider myself fortunate to be British. Forty years ago those of us forced to flee Uganda had a choice: to be Ugandan, Indian or British. Most of us chose to be British. Britain’s tolerance played a big part in that decision. While this country historically has not always been tolerant of other religions, the successful integration of so many faiths into the fabric of modern Britain—without, in my opinion, losing the distinctive elements which make Britain so superb—is an underappreciated truth.

In Britain today there are just under 1 million Hindus living—almost unanimously—peacefully and very happily. Our new British-born Hindus are succeeding in education, with huge numbers at top universities and going on to work in the professions. We are statistically more likely to be self-employed and less likely to be unemployed than, I believe, any other religion in Britain. We also have the lowest prison population of any religion and, like many faiths, take very seriously the need to give back to our local communities and carry out our civic duties.

However, I do not wish to deliver a marketing pitch for my faith; rather I want to focus on the modern approach to Hinduism. The Hindu Forum of Britain recently adopted a slogan: Proud to be British and Proud to be Hindu. We are proud of our country. My inbox is overflowing with invitations from Hindu organisations up and down the country looking forward to celebrating the forthcoming Diamond Jubilee.

Modern British Hindus are also hugely respectful of other faiths. Recently the most reverend Primate the Archbishop of Canterbury and I helped to launch the Hindu Christian Forum, one of many interfaith organisations that Hindus are involved in and help to increase understanding.

Finally, but by no means least, we are very grateful. Britain is undoubtedly stronger because of the contributions of its religious communities, but it is easy to forget how being a person of faith in other countries can lead to persecution and even death. While we celebrate the contribution of religious groups to Britain, let us not forget the freedom that Britain has given to all of us.

My Lords, I am delighted to speak in this debate proposed by my great and brilliant noble friend Lord Bilimoria. It celebrates the 150th anniversary of the Zoroastrian Trust Fund, when the Parsees established their own community outside Mumbai, or Bombay, from where they originated. However, I also want to recognise other minorities who have also put their mark on this great country. We in Britain should be very proud of our country’s diversity. Every town, city and region has both ethnic and religious communities that bring their culture to the places where they live. Just looking at the Houses of Parliament, especially in the House of Lords, we can see all different faiths and minorities working together. I am pleased to be a Member of one of them.

When I was Member of Parliament for a part of Leicester, it truly was—and continues to be—a very distinctive city. Although Christianity is the most practised religion in Leicester, there is a very large population of Indian origin, with more residents who are practising Hindus, Sikhs or Muslims in comparison with almost all of our other cities. There are also small, thriving Jewish and Buddhist communities. Each minority brings its own values and cultures to this city and to British traditions.

I have dedicated much of my life to the importance of ensuring that minorities are treated and respected with equality, because without understanding and respect, we have only got ignorance. I am proud to have founded the Coexistence Trust with Prince Hassan of Jordan, which is now chaired by the noble Lord, Lord Mitchell. It is an organisation that identifies and promotes trust and understanding for the growing Jewish and Muslim communities, emphasising our cultural and traditional similarities.

The contribution made by minority ethnic and religious communities to our culture and economy is outstanding and we should recognise and praise their input to this country. Were it not for the Indian community, we would not have one of our most famous cuisines in the UK. The famous British fish and chips were first introduced by eastern European Jewish immigrants, like my family, so we have made a contribution to this country. We must all recognise and celebrate our true diversity, continue to work with all our minorities in our fine country, and keep Britain a truly unique and wonderful place in which to live.

My Lords, I, too, thank the noble Lord for securing this important debate, as it gives us an opportunity to celebrate unsung heroes of culturally diverse backgrounds who have made outstanding contributions to our society, making this great country rich, diverse and vibrant.

One such unsung hero is the British composer known as the “black Mahler”—Samuel Coleridge-Taylor, who was born in London in 1875. He was one of the few mixed-race children in Victorian times. He was regarded by his contemporaries—Elgar, Mahler—and Vaughan Williams as the most talented composer of his generation, both in Britain and America. His best known work, “Hiawatha’s Wedding Feast”, became a worldwide sensation that captured the public’s imagination. For years it was the centrepiece of the Royal Albert Hall’s summer programme. The lavish productions were performed to packed audiences, including the Royal Family. At the time, it was more popular than Handel’s “Messiah”. Coleridge-Taylor became a cultural icon in America and was the first black man to conduct the band of the US Marines.

Interestingly, the only copy of the manuscript of his violin concerto went down with the “Titanic” on its way to America—for use in a concert—in 1912, so he had to rewrite it from memory in a very short time just before he died. His immense talent was never truly given the status that he deserved as a major composer here in Britain. He died tragically at the age of 37, a broken man who passed away sitting up in bed, conducting an imaginary symphony after being attacked by racists thugs on West Croydon station. Happily for his fans, his lost opera “Thelma” was found in the British Library recently, just in time to be performed this year, on the centenary of his death.

In more recent times, Caribbeans who came to Britain brought with them their style, flair and culture. Their music transformed and influenced the British music scene. Ska, bluebeat, rocksteady and reggae are now part of British musical heritage. Carnival, calypso and steel pan music were brought to these shores by people from Trinidad and Tobago, who celebrate their 50th anniversary of independence this year. Steel pan music—which uses the only musical instrument created in the 20th century—also played its part in creating a musical extravaganza. It has become a well established and much loved instrument played by many British school children today.

Calypso music was introduced to London by the arrival in 1948 of two “Empire Windrush” passengers, Lord Kitchener and Lord Beginner, who wrote and sang calypsos about the Caribbean immigrants’ experiences here in Britain at that time, with songs such as “London Is the Place for Me” and “Cricket lovely Cricket”. It was Lord Kitchener who led an impromptu, Trinidad carnival-style musical parade around Hyde Park and down Piccadilly towards Eros, much to the amazement of onlookers. Carnival was embraced, and perhaps this marked the moment when a new, distinctively Caribbean spirit and rhythm started to infiltrate our national culture. The carnival celebrations, fostered by Claudia Jones, became an annual event in 1959, first in St Pancras Town Hall and then in Notting Hill from 1964, where they evolved into the world famous Notting Hill Carnival, the largest in Europe, which attracts millions of visitors every year.

For centuries, this country absorbed into its fabric a melting pot of cultures, religions and races, creating the rich tapestry of our nation; but sadly, the contributions made by black, Asian and Chinese people are often absent from our cultural history. For the sake of our children we need to rectify this, and to create and stimulate national pride and unity among all people. We need to appreciate, celebrate and be proud of all that makes Britain unique and great in the 21st century. Surely this should be the overriding mission of government. I will be interested to hear from my noble friend how the Government intend to encourage these principles.

My Lords, there is an old tradition that the Magi—the wise men from the East—were Zoroastrians. My noble friend Lord Bilimoria demonstrated today, 2,000 years later, that Zoroastrians still have great wisdom and precious gifts to share with the rest of us. However, those gifts are not universally recognised. In the recent report of the United States commission on religious liberty, Zoroastrians were listed among the many religious minorities who face persecution, discrimination and imprisonment, not least in Iran. Many noble Lords heard the exchange at Question Time today about the continued abuses of human rights in that country for a variety of reasons.

Two weeks ago I delivered the annual Tyburn lecture. In penal times, Tyburn—today’s Marble Arch—was where 105 Catholic men and women were executed for their faith. Among them were Edmund Campion, a distinguished Oxford scholar, and the poet Robert Southwell, a cousin of William Shakespeare. I reflected during the lecture that Tyburn’s disturbing and poignant story is one of immense cruelty and barbarism. It is the story of a perverted legal system, and reminds us to what intolerance, mutual persecution, the crushing of conscience and what Thomas More called the breaking of the unity of life inexorably lead. Parliamentarians even brought forward measures to remove children over the age of seven from their families if their Catholic parents did not conform.

The story of Tyburn does not call for revenge and should not be used for the stoking of old hatreds. However, it is instructive and has applications today. It reminds us that the struggle for religious freedom is intrinsic to the struggle for democracy and freedom itself. This debate is timely and should remind us that we should appreciate the privileges that we have and be aware of the sacrifices that were made to secure them and committed to speak up for the millions of people who suffered or died for their faith in previous generations so that we could enjoy the freedoms that we have today.

I am a Catholic and am proud of my British and Irish antecedents. My mother was an immigrant from the west of Ireland. Her first language was Irish, not English. She married my late father, who was a Desert Rat, in the East End of London. I hold British and Irish passports, as do my children. I have always taught them that you do not hate one country because you love another. I echo what the noble Lord, Lord Bilimoria, said about holding on to the preciousness of your roots while integrating and playing your part in the nation where you live.

During my time in another place, where I was Irish affairs spokesman for many years—the day after I was elected to the House of Commons, Airey Neave was blown up in its precincts—I heard interminable Statements about tragedies both in Britain and in Ireland. Today there are 6.6 million Catholics in this country—10% of our population—and 600,000 people in England were born in Ireland. Ireland has been the largest source of immigrants to this country for more than 200 years. It is estimated that as many as 6 million people in the United Kingdom have at least one Irish grandparent. Surely it is worth reflecting, exactly a year after Her Majesty the Queen visited the Republic of Ireland, that we have made extraordinary progress despite 800 years of history and mutual hatred.

On the economic issues raised by my noble friend Lord Bilimoria and the noble Lord, Lord Bew, it is worth mentioning, especially in these troubled times, that last year €13.6 billion-worth of UK goods were sold to Ireland, and that British trade with Ireland is still greater than its business with the huge emerging economies of Brazil, Russia, India and China combined.

Today is a day for celebrating our nation’s diversity—the whole world in one country. It is an important moment to insist that along with respect for difference and minorities must come a commitment by us all to do all we can, using all our energy, to promote the unity, democracy, freedom and justice that we treasure in this nation. They are precious gifts worthy of the Zoroastrian Magi.

My Lords, when I saw that the noble Lord, Lord Bilimoria, had secured this debate, I, too, was reminded of the story that he told about the Zoroastrians coming to the shores of India, and about milk and sugar. History has borne out the fact that wherever the Zoroastrians emigrated to, they sweetened the country. Here in the UK, diverse immigration has not only sweetened Britain but spiced it up.

We heard about the many contributions made over centuries by different communities that settled in the UK, and about the diverse society we have now. Of course, this diversity has enriched us and has built a vibrant Britain. We also heard about the contributions made by minorities in all walks of life. It is a tribute to this country, and also to the resilience and ingenuity of those who came to settle here.

We should applaud and celebrate the contributions that different communities have made, but we must not forget that there are still issues that deserve serious and concerted attention. I draw the House’s attention to the report, Creating the Conditions for Integration, published in February this year by the Department for Communities and Local Government. The aspirations and sentiments expressed in the report are fine. It states that core values and experience must hold us together and that we should robustly promote British values such as democracy, the rule of law, equality of opportunity and treatment, freedom of speech and the right of all to live without persecution. It states that these values must be underpinned by the opportunity to succeed and a strong sense of personal and social responsibility.

No one would disagree with that. However, the document provides very few solutions on how to foster these values and integration. Furthermore, the comments made by Mr Eric Pickles, the Secretary of State, focused on how it would promote British values. These values have been seized on as a way of building a cohesive society. Integration is seen as a one-way process, pluralism as divisive. However, diversity and pluralism do not threaten cohesiveness: inequality does. As we heard, pluralism is our strength. For a plural and cohesive society to be successful we need a shared respect for, and loyalty to, the law of the land. However, integration does not secure loyalty to a set of values; it is about one’s view of society and one’s place in it.

The document does not address the issue of the existence of deep-seated inequalities that need to be tackled. As I listened to the debate, I wondered what unemployed youths in Brixton and Bradford feel about the issues we are debating. Programmes such as the Big Lunch and community music days are worthy, but encouraging local authorities in particular to take responsibility does not amount to a strategy to create the conditions for integration.

The report also downplays earlier approaches that dealt with the challenges of integration by focusing on legal rights, equality, discrimination and hate crime. Those of us who have been involved in this area not for years but for decades have always argued that strategies to deal with inequality and discrimination must be supported by wider initiatives such as those in the document. To ignore the issues of discrimination and inequality and just focus on inculcating British values is a flawed approach. Therefore, it would be very helpful if the noble Baroness would tell the House what strategies have been put in place to tackle the issues of discrimination and entrenched inequality.

My Lords, I, too, thank the noble Lord, Lord Bilimoria, for introducing the debate. I congratulate the Zoroastrian Parsee community on its 150th anniversary and on making a true contribution to every society in which it occupies a place.

The British Isles comprise a wonderful mix of people from all over the world who have chosen to make their lives here. Generally, all races and religions have been welcomed. However, it has not been without difficulty. For example, the Jews came over with William the Conqueror, but they were thrown out in 1290 by Edward I and only allowed back 350 years later at the time of Oliver Cromwell. Of course, from time to time, Protestants and Catholics have had their problems and we have recently seen an unwelcome rise of Islamophobia. However, overall, as my noble friend Lord Popat said, Britain has a worthy tradition of tolerance for minorities. It has been a safe haven for the oppressed.

Generally, we have welcomed immigrants here to our mutual benefit. We benefit as a country from the rich cultural contribution made by those who have come here. Others have spoken eloquently of their contributions to the arts, sciences, professions, business, sport and even to politics. Individually we have benefited, too, by learning about and experiencing different cultures. The culture that I also had thought about—perhaps because we are speaking at lunchtime—was food, rather like my noble friend Lord Sheikh and the noble Lords, Lord Singh and Lord Janner. However, the noble Lord, Lord Janner, and I must disagree because, as I understood the position, fried fish came here with the Spanish and Portuguese community in 1700. We may have to debate this afterwards.

It is very important that the traditions that have been brought into the UK by minority groups are maintained, not least so that we may all learn from their example and adopt the very best of what has come in. It is also important that, while maintaining their own traditions, everyone also becomes part of the fabric of British society; that there is one nation; that there is true integration. That is what we want. We want British citizens, from wherever, speaking English and playing a full part in the life of the community while also maintaining their traditions. Those Members of this House who come within the classification of the title of this debate have ably demonstrated that they are doing just that. They are setting a great example to the groups with whom they are associated.

While I welcome the debate, it saddens me that we single out any group to speak of its contribution to our society. I fully understand why this has been done and why there is a need to do so, but if we truly had integration here and crushed the prejudices that exist, this debate would not be necessary.

The media have a role. Why do newspapers find it necessary to point out the religion or background of people they write about? I am afraid that it is mostly when the individuals seem to be in some trouble. How can we expect minority groups to feel part of the fabric of our country if persistently we remind them that they are different? Maybe I am being somewhat naive to crave this nirvana but it is an aspiration that we should strive for. I hope this debate moves us along the road to achieving it.

My Lords, I am delighted to contribute to this debate and I congratulate the noble Lord, Lord Bilimoria, on securing it.

The contributions of many of today’s speakers—not only to the debate but through their own life stories—bear testimony to the many varied and vital contributions the religious and ethnic minority communities make to this country. The huge part played by immigrant communities in Britain’s economic and social development since the Second World War is now widely recognised. Their role in creating a more diverse and tolerant society is indisputable.

I echo the question to the Minister of the noble Lord, Lord Bilimoria, on international students. Our key competitor nations—the USA, Australia and Canada—all class international students as temporary migrants and exclude them from the calculation of net migration. Why cannot the UK do the same?

In 21st century Britain, we live in a truly multiracial society. Estimates updating the latest census figures suggest that ethnic minorities now make up some 12 per cent of the population in England and Wales. London, our capital, is one of the most ethnically diverse cities on earth, with over 300 languages spoken. In particular, the creative industries, which have been among the fastest growing and most important to the capital’s economy, owe much to London’s cultural diversity. The capability of London’s businesses to communicate in many languages across cultures means that London’s creative industries can flourish on a global scale.

Over the next 10 years, ethnic minorities will account for more than half the growth in the working-age population. Nowhere is this more evident than in my home town of Bradford. Bradford has the youngest, fastest-growing population outside London. Some 22% are of British-Asian origin.

As a former textile capital of the world, Bradford has a long history of immigration and, as a result, has become enriched as one of the north’s most culturally and ethnically diverse cities. The German merchants who settled there in the 19th century were followed by Italians and eastern Europeans, then by immigrants from the Indian subcontinent, particularly Pakistan, who came to work in the mills. As the textile industry declined, the workforce moved to other sectors of the economy so that today the city has a thriving Asian business community. Engineering, printing and packaging, chemical, financial, banking and export industries, as well as high technology and the media industries, are all part of the local economy.

Culturally, it is buzzing. Its National Media Museum is the most visited museum outside London. It was the first of the two UNESCO Cities of Film. It has the world’s first Fairtrade café. It has the internationally renowned Hockney Gallery in Salt’s Mill, where I try to make an annual pilgrimage. The Bradford Mela—which, back in 1988, was the first such festival in Europe and is now the biggest of its kind outside Asia—takes place in a couple of weeks. It attracts thousands every year, who come together to share and celebrate their cultures.

Other speakers have lauded the work of ethnic chefs. Bradford is also, of course, famous for being home to some of the best curry houses in the country and was last year crowned Curry Capital of Britain.

I could continue with my ode to Bradford but I simply urge noble Lords to visit and enjoy it for themselves.

With my noble friend Lord Griffiths of Burry Port I happily acknowledge the talent, entrepreneurialism and creativity that ethnic and religious minorities give to our country. I add my congratulations to those of others on the 150th anniversary of the Zoroastrian Trust Funds of Europe, celebrated with such passion and warmth by the noble Lord, Lord Bilimoria.

My Lords, I apologise for being slightly late because of transport problems and for not being here at the beginning of the debate. I, too, thank the noble Lord, Lord Bilimoria, for securing it.

Britain owes its place in the world to the contributions of many people, of all races, colours and creeds, who have settled in the United Kingdom from various parts of the world. They have contributed to the economic growth and well-being of the nation. I work with many of them.

Owing to the limited time for today’s debate, I shall focus on the Muslim community, many of whose members migrated from the Indian subcontinent for economic reasons. Most of them were invited to work in our manufacturing industries in the 1950s and 1960s. They arrived almost empty handed. According to the Guardian of 28 January 2011, the Muslim population in the UK is now more than 2.8 million. Over the years, these communities not only carried out some of the tedious and physically demanding jobs that were hard to fill but contributed enormously in many sectors.

I will quote a few examples. According to the Muslim Council of Britain, Dr Mahmood Adil, the Deputy Regional Director of Public Health for NHS North West, has made a substantial contribution through his clinical, public health, academic and senior Civil Service roles, notably the development of the Diabetes National Service Framework and the preparation of the Department of Health’s toolkit to support good practice in international humanitarian and health work.

Professor Waqar Ahmed is deputy vice-chancellor of research and enterprise at Middlesex University. His previous academic career was at the University of Leeds as a professor and director of the Centre for Research in Primary Care, and at the Universities of Bradford and York. For three years, he was the chief social scientist in the Office of the Deputy Prime Minister, where he launched the ODPM/ESRC Fellowship and Studentship Scheme and the ODPM research networks.

According to the London Chambers of Commerce report of December 2001, one in 10 businesses in London is owned by people of Pakistani or Bangladeshi origin. A good example of entrepreneurship is Sir Anwar Pervez, who came to Britain aged 21 and became a bus conductor in Bradford, before opening a corner shop in London in 1962. He launched the Bestway cash and carry firm in 1976. According to the Female Entrepreneur Association in September 2011, the company is now worth over £500 million, employing 5,000 people in the UK and many more abroad.

The online newspaper Muslim View wrote on 23 May 2012 that Britain has more than 10,000 Muslim millionaires, including 53 billionaires. According to the Salaam Portal website, there are 100 charities in the UK run by Muslims. The list of Muslim contributions to contemporary Britain goes on. If the time allowed, I could have given similar examples of contributions made to our society by the Jewish, Hindu, Sikh and other communities.

Finally, I ask the coalition Government, when they are assessing immigration policy, to learn from history in order to implement policies that will benefit everyone in all communities in Britain.

My Lords, I thank my noble friend Lord Bilimoria for introducing this debate with great verve. Like the noble Lord, Lord Hussain, I approached the debate from the direction of British Muslims. It is not always recognised that this community is far from monolithic—on the contrary, ethnic, cultural and even theological divisions abound. That is why it is not easy for all Muslims to speak with one voice, and why official and unofficial agencies sometimes find it difficult to approach Islamic communities.

I declare a non-financial interest as a founder-trustee of the English charity Forward Thinking. Since 2004, it has worked in a facilitating role to increase understanding and confidence between the very diverse local Muslim communities and wider society in the UK, including the media and established institutions. We seek to assist local community development without the fear that individuals and families will lose their faith identity. We therefore work in partnership with many culturally and religiously diverse Muslim groups in addressing local needs and community concerns.

The aim is to retain a strong faith identity while the partners live as full British citizens. To achieve this, we provide capacity-building support to a number of Muslim charitable or non-profit organisations, both local and national. Thanks to the trust established and our unique access, we have been able to arrange exchange visits between senior government officials and local community organisers. Our programmes are delivered mainly by British Muslims, including regular meetings for journalists and broadcasters.

More work of this kind is needed wherever there are local Muslim populations, some long-standing but others who have arrived more recently. I am confident that it will pay huge dividends in mutual understanding, crime reduction, development of employability and careers, and civic cohesion in general. Forward Thinking is a sensitive exercise in bridge-building. It welcomes dialogue about its work in England and its wider concerns, mainly located in the Middle East.

My Lords, I congratulate my noble friend Lord Bilimoria on initiating this timely debate, and his excellent speech.

The Zoroastrian community has always been a minority community in whatever country it has existed. But by its conduct and its contribution, it has without exception been a model of good citizenship, holding its members to the highest standards of ethical behaviour. At a time when grievances are often provoked and expressed by violence, this approach has been a lesson for us all. As Mahatma Gandhi said:

“An eye for an eye will make the whole world blind”.

I now move to the larger implications of the noble Lord’s Motion: the contribution made by minority ethnic and religious communities to the United Kingdom. Too often, minorities are viewed by significant parts of the majority as takers and not givers. Of course, this is palpably wrong, as is evident from the minority involvement in every field of endeavour: from public life to commercial enterprise, from the arts to sport, from education to government services. Minority involvement is growing and is now irreversible.

I do not need to remind your Lordships that this has been somewhat slow in coming, not because minorities were reluctant or unqualified but because barriers were placed in their way. Recent times have seen these formal and informal obstructions being dismantled. We must continue these efforts and guard against any reversal and, in doing so, open up avenues of advancement to higher positions, a situation in which recent studies have shown there is considerable inadequacy.

People are not born with discrimination in their blood. They are socialised into it, as I know well. I visit London Zoo as often I can because it is partly a memorial to my infant daughter. I well recall how, 46 years ago, her last tragic months were brightened by regular visits there and by being with other children of all communities. When London Zoo was in danger of closure in the 1990s, I was delighted to step in and help. My delight today is to see how children of various ethnic communities mingle freely and enjoy companionship without any regard to racial, religious or other backgrounds. In this camaraderie, small children have many lessons for their parents.

I have been, and am, chancellor of two British universities: the University of Wolverhampton and the University of Westminster. Both have overseas branches and consequently a sizeable student body representing a number of nationalities. It must be remembered that when these overseas students return to their countries, they continue to make a great contribution as ambassadors for Britain.

The noble Lord, Lord Bilimoria, succeeded me as chancellor of the University of West London. He will confirm that a majority of younger students is far less concerned with ethnic and religious differences than with joint activities. These are the very people who, as they grow into full adulthood, can harbour prejudices that are of much concern in this country. Responsibility for enlightenment cannot be left to the individuals alone. That is why I urge the Government to make every effort to encourage the expansion of educational curricula to include more information and analysis of minority contributions.

These are difficult days in community relations, and economic distress often makes them more difficult as retrenchment takes place that often affects minority communities first. However, whatever areas are drawn down, that should not include cuts in the minority-related programmes. Small economic gains must never be at the expense of the social fabric of the nation.

In common with the majority of Members of this House, I have over the years been pleased to serve on a number of charitable, government and non-government bodies, including the NSPCC, the Prince’s Trust, the RNIB, the Royal Albert Hall and London 2012. I chaired the Indo-British Round Table—

My Lords, I congratulate the noble Lord, Lord Bilimoria, on his excellent contribution today, first in managing to secure the opportunity for us to debate this very important subject and on his very inspirational speech. He is an illustrious role model for all of us and makes an enormous contribution, as indeed do all Members who have spoken today, particularly those who have been successful within the minority-ethnic and religious communities in this country, in providing inspiration for others, as he rightly said in his introduction, to follow. I am most grateful to all that he does for us in this House as well as in the wider society here and for businesses in India.

It is important, having acknowledged all the achievements that minorities have made in this country and contribute to Britain, that we also recognise some of the pain that goes with that. Minority-ethnic communities have made a substantial contribution, as we have heard to a substantial extent already today. London is the most culturally diverse city in the world. As someone who has travelled to many other cities from time to time, I marvel at what we have and enjoy, notwithstanding the fact that many who live in this great city are suffering disadvantage and deprivation.

The noble Baroness, Lady Benjamin, very excitingly told us about all the contributions that African-Caribbean people have brought to this country. It is quite important, as we listen to the history in the various contributions, to recognise the value of that particular contribution. However, there was a reference to the glass ceiling being broken. For those who have been successful, it has been; but for a lot of other people it still remains. We hear daily from many people from minority backgrounds who are highly qualified and also highly professionalised about their failure to make the breakthrough and get access to those opportunities that we know are available. In the Metropolitan Police Service, many black and ethnic minority officers came very close to getting to the top—but where are they now? That is just one simple example.

We talk about “our” country, as noble Lords have—quite rightly—today, but there are many minority-ethnic communities in this country where people do not feel they belong. We have a very important role to help people feel that they do belong. If Britishness encapsulates a variety of ethnicities, religions, cultures and heritages, then we owe it to those who feel disaffected to help them feel they belong to the notion of being British and being part of Britain, make their contribution, and go on to be who they think they are and what they want to become.

The noble Lord, Lord Alderdice, mentioned that we need to have an open mind. We are able to do so in a place such as your Lordships’ House but we have to work harder to open the minds of many more people so that we can bring those who feel disaffected into the fold to see the value and the benefits of being part of this great society.

My Lords, I join others in congratulating the noble Lord, Lord Bilimoria, on this debate and his notable introduction, reminding us of the long contribution of the Zoroastrians and of the rich and diverse contribution made by a wealth of minority ethnic and religious communities to all our lives, our culture, our history and, I believe, our future. In his words, one of the strengths of those groups was to blend in with us. That is what we celebrate today.

I also, along with others, pay tribute to the work of the Zoroastrian community in the UK, particularly on interfaith issues, about which I have heard from the Member of Parliament for Harrow West, Gareth Thomas, in whose constituency they are headquartered.

Born outside the UK, and from a Welsh heritage, I have always felt a bit of an outsider to what may be called “mainstream” English culture. However, I was horrified some years ago, cleaning out a very old filing cabinet, when I found a programme for a 1960s university debate where I had seconded the motion: “Immigration threatens our way of life”. I cannot tell you how sick and ill I felt. I had a cup of tea—of chai—but nevertheless went on clearing out the mass of paper, of which I collect rather a lot. It was some hours later before I was enormously relieved when I found my speaking notes. I had completely forgotten that the teenage Hayter had extolled and rejoiced in the threat to our way of life, especially the threat to our stuffy society. I went on to praise the aromatics of the food and the break from meat and two veg, which the noble Lord, Lord Singh, and others have mentioned, the music, the different voices and the colour of swirling clothes.

I was young and apologise to one and all that it was the food, including the salt beef bagels, and fashion rather than medicine, the City or military records, that attracted me first to the richness and variety of the worlds I experienced in London: for me, at that time, the very Mecca of internationalism. I still remember the absolute joy of walking past newsagents near Bayswater Road with newspapers in languages whose alphabet I could not even then begin to recognise. It began a serious love affair with “abroad”, whether that was here or away. In the words of the noble Lord, Lord Griffiths of Burry Port, it opened my eyes. Slowly, of course, I learnt more of the religions, language, histories and culture of distant parts, and revelled in the contribution these made to our own daily life.

Neil MacGregor’s BBC series, “A History of the World in 100 Objects”, has been a stunning reminder of our intertwined heritages, although even that failed to document how our own economy and culture have adopted and absorbed titbits, or indeed sometimes great swathes, from the groups who moved here to live: the Huguenots, Jews, Sikhs, Muslims and Hindus, the lace-makers, printers, chefs, academics, medics, playwrights, jazz singers, Italian opera lovers, rappers, violinists, designers and tailors, Chinese seafarers, Vietnamese chefs, Italian cooks, Polish miners and Irish builders, writers and students, scientists and politicians, as well as synagogue, temple and mosque builders, and, of course, the Pugin family. It is in Pugin’s masterpiece that we speak today.

Many of our own religious groups are of course themselves minorities, such as the Methodists whose million pennies in 1912 built the iconic Central Hall on the other side of Parliament Square, but many of those who moved to our shores came to escape persecution or poverty. Some came as prisoners of war and stayed, some came as children, some came in groups. However, all brought with them a history, a language, a religious faith, their music or their craft, from which we have taken, learnt and benefited. Indeed, our language as much as our food today reflects the influence of immigration across the centuries.

Immigrants also help to teach us the importance of human rights. It was their suffering in other countries that spurred us to work for the Universal Declaration of Human Rights. I have to confess that it was only today that I learnt from the noble Lord, Lord Bilimoria, a rather longer history of human rights development. It was the poverty from which some escaped that spurred our efforts in Make Poverty History, although we should acknowledge that these immigrants’ own remittances to their own countries, where they retain their roots, far outweigh our own donations. One of the measures of a civilised society is its tolerance of those of other faiths and none. A report by Demos has demonstrated that people who belong to a religious organisation are more likely to practise philanthropy but also to value equality over individual freedom and less likely to have a negative association to living next door to immigrants.

On Tuesday, we will have a debate initiated by the noble Lord, Lord Sacks, on how Her Majesty’s Government have recognised and supported the role and contribution of faith communities in Britain and in the Commonwealth. I give notice to the Minister that I will be asking why the Government have disbanded, without consultation, the Faith Communities Consultative Council and what is proposed to be put in its place. As my noble friend Lady Royall mentioned, the Government have spoken of the big society and the role of communities in strengthening themselves. However, I would like to hear the same urgency from this Government about the scar of youth unemployment. I feel no anger from the Government on this and no fear of what the threat posed by youth unemployment will do to growing communities, whether in Brixton or Bradford, as have been mentioned, particularly its potential to increase racism.

Finally, may I be forgiven for saying a word about the Labour Party and the role of religion and minority communities in our own history? The churches were absolutely crucial in our development. In 1906, virtually the whole of the inaugural PLP came into politics through the church. Since then, other faiths and communities have been particularly involved, such as: Poale Zion, now the Jewish Labour Movement, founded in the UK in 1906 and affiliated to the party since 1920; the Christian Socialist Movement; Muslims for Labour; Sikhs for Labour; the Labour Party Irish Society; and Labour’s latest affiliate, Chinese for Labour.

I should declare an interest as I think I am probably an honorary member or president of all of those, but the interest is non-pecuniary. It is wonderful to see their development, not just historically but currently. Despite sharing none of these faiths, or indeed any other, it might therefore be easier for me to acknowledge and cherish the amazing contribution that faith groups and minority ethnic groups have brought to our shores and which we celebrate today. Many are represented in this House and to all of them we simply say thank you.

My Lords, I am delighted to be here today to reply to this fascinating debate on behalf of the Government. The noble Lord, Lord Bilimoria, is a noted entrepreneur and a great speaker, as we heard earlier today. He is a great businessman; Cobra Beer, which he founded, has celebrated a 5,000-mile journey from Bangalore to Burton, spanning 25 years. I am pleased to say that it is now fully brewed and distributed from the flagship Molson Coors brewery in Burton, the UK’s biggest brewery. The noble Lord is renowned for his philanthropy and I can therefore think of no fitter person to initiate this debate. He is respected as an adviser both to previous Governments here and to the Government of India.

I am also pleased to take this opportunity to congratulate the Zoroastrian or Parsee community on celebrating the 150th anniversary of the Zoroastrian Trust Funds of Europe. It is a community just a few thousand strong but one that punches well above its weight. It is a community noted as much for its musicians such as Zubin Mehta and Freddie Mercury as for running businesses—not least Tata Motors, which has been referred to and whose Jaguar Land Rover enterprise employs over 19,000 people in this country. The Zoroastrian community has surely set an example for us all.

As we have heard from a number of noble Lords today, Britain’s black and minority ethnic communities make a huge contribution to our economic, social and political life. You need only look at the bustling high streets, pick up a newspaper or switch on the television to see how much richer our society is because of these minority communities. My noble friend Lord Sheikh referred to their influence on food and the culinary delights of this country are now so immense, as I remind myself every time I hit the treadmill. The noble Lord, Lord Janner, reminded us that we owe even the very British fish and chips to the eastern European Jewish community, although my noble friend Lord Gold corrected him, suggesting that it is possibly the Spanish or Portuguese. Whoever it was, I am glad they did.

The noble Lord, Lord Loomba, and the noble Baroness, Lady Warwick of Undercliffe, spoke about the economic contribution that Britain’s black and minority ethnic communities make. There are hundreds and thousands of ethnic minority-led small and medium-sized enterprises in the United Kingdom, contributing an estimated £25 billion to the UK economy per year. The entrepreneurial spirit is alive and well in BME communities and is needed in these difficult times more than ever.

The noble Lord, Lord Bilimoria, referred specifically to immigration and students. I can say categorically that there is no limit or cap on tier 4 student visas. This country will always remain open for genuine students who are coming here to study a genuine course at a genuine university. However, I am sure that many in this House would agree that if this country is open and welcoming for students coming to it to study, it should not follow that it must be an automatic right that they can remain here for ever. He also raised the catering industry, specifically in the Bangladeshi community. The Government are taking necessary steps to train British people to fill the gap in the Asian restaurant business as part of the wider skills for sustainable growth strategy. While I accept the huge contribution made by chefs who have come in from overseas, I am sure that your Lordships will acknowledge that sometimes it is in the very communities where these businesses come from that we see the worst rates of unemployment. Surely we must target the youth in those communities to be trained to do the very jobs for which we think that we can bring in only people from overseas. As my noble friend Lord Wei said, we must strike the right balance.

We have a huge economic advantage. We have a diaspora community that links us with many growing economies: the powerhouses in India, China, Pakistan and Africa. My noble friend Lord Hussain was quite right to highlight the contribution and achievements of many in this diaspora community, some of them from the Muslim community, who came to these shores with very little and have made such great contributions.

Many of your Lordships spoke about the political contribution that Britain’s black and minority ethnic communities make. A record-breaking 27 individuals of African, Asian or Caribbean heritage were elected to the other place during the last general election in 2010. Sixteen of them were Labour and 11 were Conservatives. I am pleased that 10 of the 27 were women. However, we must do more and I must congratulate the party opposite on having achieved many of the milestones in relation to black and minority-ethnic parliamentarians many years ago. I am glad that the Conservative Party followed in 2010 by having its first Asian elected in Priti Patel and its first black woman elected in Helen Grant. This is indeed the greatest number and percentage increase ever seen in British politics, but I think we would all acknowledge that we must do more.

Greater black and minority-ethnic representation and greater involvement from all communities in the political process will only enhance our democracy. We are all aware of the positive contribution that black and minority-ethnic Peers, many of whom we heard from today, make to the work of this House. We are reminded by the noble Lord, Lord Bilimoria, about the Zoroastrian community’s fine history in the Houses of Parliament in his references to Dadabhai Naoroji and Shapurji Saklatvala who were elected many years ago. Political parties indeed have a role in engaging with various communities. I know of the work that my noble friend Lord Wei is doing in relation to the Chinese community. I also know of the work done by the Labour Party. We saw in Bradford West that we must never take for granted the votes of these minority communities. They can turn quickly and we realise that by not listening and engaging extensively with them electoral losses can come about.

The noble Lord, Lord Ahmed, spoke about the vital role that Britain’s black and minority-ethnic communities make in our public services and have made in the past, especially in the Armed Forces. The research and work of Jahan Mahmood, to whom he refers, is truly fascinating. The noble Lord, Lord Kakkar, referred to the work of the Asian community in medicine, specifically to his contribution and that of his family and members of the Asian community to the National Health Service. Over a number of recent years, there has been less reliance on securing staff who have been trained overseas. The reformed education and training system is designed further to improve planning and to track progress and ensure that there are enough trainees in the National Health Service to create a workforce that meets the changing needs of patients.

The noble Baroness, Lady Benjamin, spoke about the cultural contribution that Britain’s black and minority-ethnic communities make, specifically that of the Caribbean community, in referring to the culture of carnival. In the arts, there are so many talented individuals that one could mention contributing to our rich cultural life: visual artists such as Chris Ofili, writers such as Monica Ali and Zadie Smith, musicians such as Tinie Tempah, Dizzee Rascal and still one of our biggest musical exports Sade. The noble Baroness herself played an enormous role in my life. Her presence on that iconic children’s programme, “Playschool”, formed the aspirations of many a non-white child. In fashion and clothes we can see further contributions. I was asked by one of my colleagues whether my outfit this morning was a nod to the debate that I was to going to close on behalf of the Government. I said that it was simply hot and too stuffy to wear a suit.

The noble Lord, Lord Paul, spoke of the contribution of black and minority-ethnic communities to sport. In football we have 66 black players who have represented England over the years. A little, unknown story behind that of the black footballer Fabrice Muamba, whom we saw collapse on the pitch, is that the doctor who came to his aid is Shabaaz Mughal, a British Pakistani. In cricket, we have Monty Panesar and Sajid Mahmood. In many ways, with cricketers like these maybe there is no further need for the famous cricket test. In rugby league and rugby union, we have black and minority-ethnic communities providing some of the best and most recognisable personalities, such as Martin Offiah, Jason Robinson, Jeremy Guscott and Ikram Butt. In boxing we all recognise Amir Khan and Lennox Lewis and in motor racing our very own Lewis Hamilton.

Diversity was a key reason why London, one of the most multicultural cities in the world, was chosen to host the Olympic Games. The London Organising Committee is making diversity and inclusion the key aspect of our Games, celebrating the many differences among the cultures and communities of the United Kingdom. That is not just about our athletes. It is about the suppliers, the competitors, the officials and the spectators—in fact, everyone connected with the Games, from the security guards to the bus drivers. With just 64 days to the Olympics, I would like to take this opportunity, and I am sure noble Lords will too, to congratulate a member of this House who has been a huge driving force behind this event, the noble Lord, Lord Coe.

My noble friend Lord Popat spoke about the charitable contribution that Britain’s BME and faith communities make, specifically the Hindu community. I also congratulate the work of the noble Lord, Lord Hilton, and of Forward Thinking, who do much to create better understanding between communities. The noble Baroness, Lady Royall of Blaisdon, spoke about the Government needing to do more in relation to social action in the voluntary sector. The Government are doing all that they can to open up more public services being delivered by the voluntary sector, not because the Government are shrinking from their responsibility but because the voluntary sector is invariably better at delivering them.

In relation to charities and faith organisations, I have rarely come across a church, mosque, temple, synagogue, gurdwara or any other place of worship that has looked holy within that did not want to take care of its neighbours, no matter if they had a different faith or indeed none. Some 31,000 religious charities are now registered in England and Wales, as well as many that draw their inspiration from faith. Six hundred and sixty-two new religious charities were registered between October of last year and March of this year, a quarter of all newly registered charities during this period. Religious charities have a combined annual income of over £7.5 billion and spend over £7 billion each year. Many of the best known charities have faith origins and are linked to particular denominations, including Christian Aid, Muslim Aid, Islamic Relief and Jewish Care. The noble Lord, Lord Bew, was right to refer to the contribution of the Jewish community in charitable work. The Children’s Society, Save the World, World Vision and Tear Point and many charities which are now secular had faith origins, such as Oxfam.

This Government are on their side. As I said at the Anglican Bishops’ Conference, that is why as a Government we do God. I assure the right reverend prelate the Bishop of Derby that I will do all I can to continue to support initiatives such as Inter Faith Week and I hope that he gets some comfort from the Government’s decision to enter into a three-year funding programme for the Inter Faith Network. We are keen, however, to see different faith groups link up to pool expertise and resources so that their impact is increased.

In conclusion, there is still much to do. Opportunity is the cornerstone and it is right that as well as the positives about which we heard this morning we remain committed to and aware of the reality of some as detailed by the noble Lord, Lord Ouseley. There are still many who feel that they do not have that opportunity.

I congratulate the work of UpRising, as referred to by the noble Baroness, Lady Royall. They are the leaders of the next generation and they do some tremendous work. In relation to the issue raised by the noble Lord, Lord Bilimoria, on representation of the Zoroastrian community at the Cenotaph, I will ensure that I raise this with the Secretary of State. If he so wishes, I will also facilitate a meeting between him and officials at the department to take that forward. I agree wholeheartedly with some of the sentiments of the noble Baroness, Lady Prashar, but I do not believe that British values and integration is a one-way street. British values are made of the values of everybody who is on these shores. When he visited a Muslim family with whom he spent time in Birmingham, the Prime Minister said that the value of looking after your elders, which he saw so starkly and strongly within the Muslim community, is a British value that we can all sign up to.

What are the opportunities in relation to entrenched inequalities? I am sure that the noble Baroness will agree that most fundamentally it boils down to opportunity and opportunity through schooling. The Government’s programme of reform and investment in schools, in relation to academies and free schools, many of which have been opened in the most deprived communities, will be that first opportunity for those children to have a better life.

The noble Lord, Lord Dholakia, referred to work on tackling discrimination. He has a long and commendable history in this work. I congratulate him on continuing on it. He asks, “What is all the fuss about multiculturalism?”, a question that I find interesting. It sounds like the title of a very good paper which I am sure that the noble Lord could write.

We have been here before. We were reminded of this by the noble Lord, Lord Alderdice, and I support his comments on keeping the public space open for religious opportunity. We are not like the French. I welcome the contribution of the noble Lord, Lord Alton of Liverpool. Politicians are not great historians. Every time I read British Catholic history, I see lessons that we can learn for challenges which are personal to me as a British Muslim.

The noble Earl, Lord Listowel, referred to the recent case of children in care, specifically girls in care. I will take his comments back and ensure that the Minister responsible for this, who I know is looking into this case, makes contact. The noble Earl may be aware of the comments I made last week in relation to that case.

Discrimination wherever it occurs and whoever instigates it must be spoken out against. Vulnerability can come in many forms. It is not just about the colour of a person’s skin. We must also celebrate. The noble Lord, Lord Griffiths of Burry Port, was right to refer to celebrating each other’s cultures by carrying each other’s flags. I would go further and say that it is about speaking out for each other. It is when I, a Muslim, can speak out against anti-Semitism and my Jewish friend can speak out against Islamophobia that we are making true progress.

I was pleased to see my right honourable friend the Communities Secretary celebrate alongside the Ahmadiyya community on the recent charity walk. I congratulate the noble Lord, Lord Ahmad of Wimbledon, on all the work he does in relation to that community.

There is a tapestry in what we have seen this morning and in what we have seen in this debate. It is a tapestry that influences each and every aspect of our lives. I know that when I wake up in the morning and listen to the tones of the noble Lord, Lord Singh of Wimbledon, on “Thought for the Day” it sets me up for the rest of the day. I acknowledge that, as the noble Baroness, Lady Hayter of Kentish Town, said, we can all continue to learn. I know that in this job, I have the privilege of doing that every single day.

My Lords, I am grateful to the Minister for that excellent summing up and for her positive response to a superb wide-ranging debate. We heard Peers from a range of minority religions and communities speaking from experience. I have been genuinely inspired and touched by what has been said and by noble Lords’ kind words about the Zoroastrian community. I have been considering forming an all-party parliamentary group on Zoroastrians, and this debate has convinced me that I have got to get on with it in this 150th anniversary year.

I thank noble Lords very much. The debate has shown that Britain is a Great Britain thanks to the contribution of minority ethnic and religious communities. As I said in my opening remarks, I hope that this debate sends out a message of recognition, encouragement and gratitude to the minority religious and ethnic communities for the amazing contributions that they have brought the past, bring today and will always continue to bring to Britain in the many years to come.

Motion agreed.

Food Security Policy

Motion to Take Note

Moved by

My Lords, I declare an interest in my family vineyard and farm, Vignobles Temperley, and family cider business. I was absolutely delighted to win this topic in the balloted debate, but I am even happier to see such an array of experts who will contribute. Noble Lords know that even in the UK and Europe we cannot afford to be complacent about food security. We are the lucky post-war generation who, by and large, have not seen shortages. We have only recently begun to understand the importance of the concept of global food security rather than seeing it as an issue only when there is a regional famine or shortage far from these shores.

One of the problems has been that political attention has not really focused on food production or nutritious consumption for a long time. We did not even get government time to debate the Chief Scientific Adviser’s immensely important report The Future of Food and Farming but, just like buses, you wait for ever and then they all come at once. The G8 had food security high on its agenda last weekend. This week, the Environmental Audit Committee in the Commons published its excellent report Sustainable Food and in this House this subject for debate wins the ballot. At least we are focusing attention.

In March this year, the UN high-level task force on food security made the point that there is no one set of policies to tackle food security that is globally applicable, but it identified some key pointers and the crucial importance of sustained political commitment. Historically in the UK, political attention has focused on food production when there has been a crisis or a scare such as salmonella in eggs or a disease such as foot and mouth or BSE. For a moment, food and food issues are a political hot topic, and then attention wanders away again to the more seductive stage of foreign affairs or the Olympics, but circuses would lose their charm without bread. I am pleased that the noble Lord, Lord Curry, is going to speak this afternoon because his commission did a lot to bring this to national attention.

In nations where many people live a precarious existence, a food price increase or a shortage can cause the sort of riots that we saw in dozens of countries in 2008 and that were repeated to some extent during last year’s price spike. Even in rich and middle-income nations, we must assume that things are not always going to be as comfortable and easy as they have been over past decades. The expertise in today’s list of speakers allows me not to attempt to address why and how climate change, water shortages, storage problems and animal diseases are undermining food security.

The only international issue I will touch on is the relatively new phenomenon of some richer nations and multinationals buying up vast tracts of land, especially in Africa: so-called recolonisation or land grabbing. At its worst, land grabbing dispossesses whole villages from their subsidence existence against their will. There is an illusion that big international deals bring investment and new technology to a region, benefiting local people, but in fact that ideal is rarely achieved. More often, local communities are dispossessed of their lands and return, if at all, only as minimally paid workers and profits are exported. Fred Pearce in his recent book, The Land Grabbers, gives many examples from different continents of the huge downsides to the practice. I am sure many of your Lordships have seen examples on your travels. I certainly have, notably in Ethiopia. The UN has just adopted historic land grab guidelines for rich countries buying land in developing nations. Guidelines are better than nothing, but there is something immoral about dispossessing the already very poor to feed the well off better or to provide biofuel for their motorcars. I hope the UK Government will support this UN initiative and ensure that UK-listed companies do not ignore the UN guidelines.

I am going limit the rest my contribution to Britain. This week, the NFU launched the campaign “Farming Delivers for Britain” which demonstrates that our agriculture is a bright spot among the austerity gloom. That is good news indeed, but how well are we caring for the basics that enable that agriculture and make us so well placed to feed ourselves and to maintain healthy exports not just of food but also of knowledge? Knowledge and expertise are probably our most useful contribution to global food security.

I am going to focus on just a few of the essential ingredients of a healthy UK production and consumption food policy and on perhaps the most fundamental thing of all, which is soil. A properly managed soil can do so many different things. It stores carbon, retains water, maintains a vibrant ecosystem, reduces pollutant run-off and cuts greenhouse gas emissions, and also produces healthy, nutritious crops. However, I am sure that your Lordships have often seen water flooding off the fields during heavy rain, washing down the drains into streams and filling rivers. It is even more terrifying when you fly, look down at rivers and see that they are dark brown after heavy rains. That is the soil washing into the oceans. We have not looked after our soils. They are literally disappearing through erosion, including wind erosion. The erosion rate is about five times faster than the formation rate. We are also losing prime soils to development. We are just tarmacking them over. We cannot afford that rate of loss and, if we have not lost it, soil fertility itself has been diminished by farming practices over decades. The Food Ethics Council recently produced an excellent collection of research called Soil: A Fragile Foundation. It highlights the national lack of targets and indicators of a healthy soil. I wonder whether the Minister’s department is tackling that now.

Back in 2006, there was an EU soil thematic strategy which would have helped with some of this but the then UK Government blocked its implementation, thereby setting us back many years. Now I assume that we are supporting the EU soils framework directive wholeheartedly. Then there is the farm regulation review, which suggested a duty of care for soils. Can the Minister say whether Defra is considering that? How does practical support for farming practices—increased soil and health structure—fit into the CAP reform proposals?

Secondly, we should play to our strengths. In the UK, we have some of the best grass-growing conditions in the whole world and a wonderful range of livestock breeds, both old, traditional breeds and modern breeds. Their genetic strengths are in world-wide demand. I hope that Defra’s policy will be to support and strengthen this sector rather than to encourage the development of a livestock sector that will rely on vast quantities of imported soya or require the UK to devote considerable acreage to protein production for cattle lots and dairy production, US-style. How is Defra’s assessment of the intensive dairy proposals going? What work is Defra doing on carbon footprinting the different production methods?

On insects, they have an up side and a down side. The down side is, of course, that they can be such tremendous pests. Last year, a letter in the Times from the UK’s leading entomologists highlighted the fact that there were actually only 10 professors of entomology left in the UK. It is such a crucial area of study—the huge impact of insects on food production and storage. I ask the Minister whether that position has improved.

While I am on the subject of insects, I turn to bees. I welcome Defra’s healthy bee action plan, which is a great step forward. It addresses the health of the honey bee, but the honey bee pollinates only about 15% of our crops and wild flowers that are insect-pollinated. The other 85% are pollinated by the other 265 species of bee and pollinators, which are also suffering severe declines of about half their numbers. Can Defra produce similar plans and guidance to help to ensure that the decline of the wild bee population is halted and reversed?

Food security is all about resilience and diversity. We must value our seed heritage and our different animal breeds. I congratulate Garden Organic on its heritage seed library collection and, indeed, Kew on its work. These and other organisations are guarding and developing for future generations—and, in the case of Garden Organic, for the public to use—a large number of unusual and heirloom varieties.

The hot topic of this afternoon may well be biotechnology. I am looking forward to the contributions on that. Public confidence in GM was adversely affected right at the beginning by the Monsanto approach which tried to prevent farmers saving seed. The public came to understand that it was just about the bottom line and not the public good. That approach bred distrust and suspicion. I hope that we can move away from that first generation of GM. I do not that think GM is the answer to food security issues, but nor should we seek to halt scientific exploration and trials. There are many interesting things to explore. Among the less controversial but very interesting advances of biological sciences that are being progressed is accelerated selective breeding, which deals with same-species genetic changes rather than cross-species manipulation. I am anxious that we not be diverted by huge EU battles over GM. It has already sucked so much political capital, energy and investment, leaving fundamental deficiencies in the rest of the scientific effort. Can the Minister tell us the latest UK position on EU negotiations over GM?

We have another round of CAP reform coming up. We must use this round to make sure that it offers farmers support that is all about farming for the future as well as for today. One of the things that worries me most about the future is the lack of young entrepreneurial people choosing to go into farming and food production. On this, I miss my late noble friend Lord Livsey, who often decried in this House the contraction of our agricultural college places. I hope that that decline has halted or will be put into reverse.

There are lots of other forms of support for farmers, such as co-operatives—buying co-ops, selling co-ops, machinery co-ops—which other countries practise far more than we do. There is a great strength of advice for the struggling lone farmer from that sort of circle. I hope that Defra plans to strengthen co-operation between farmers. There have been some interesting examples in various parts of the country, including Somerset. It is work that needs more impetus.

I am sure that other speakers will highlight other examples and the very interesting report, Innovation in EU Agriculture, from Sub-Committee D of the EU Committee. I am pleased that members of that sub-committee are speaking this afternoon. The report covered developments such as precision agriculture, with precise dosages and timing of fertilisers, and better land practice. I will not have time to talk about agro-forestry or perennial crops, or low-till and no-till regimes, but all these things offer us a tremendous amount for the future. It is actually an exciting time in agriculture.

Amartya Sen said that,

“there is no such thing as an apolitical food problem”.

We have many of the tools that could enable us to solve the issue of precarious food security. We can do it, but we need to keep the political attention firmly focused on food and food security. I beg to move.

My Lords, I remind noble Lords that this is a time-limited debate. When the clock shows “6”, you are in your seventh minute.

My Lords, I start by congratulating my noble friend Lady Miller on the way in which she has introduced this important debate and given us an opportunity to address this critical issue. I declare an interest as a farmer; as the chair of Living with Environmental Change, which is a partnership of government-funded research; and as a trustee of East Malling Research. I will confine my remarks to global food security issues.

As my noble friend reminded us, the agenda was helpfully set out by Sir John Beddington, the Government Chief Scientific Adviser, and his colleagues in the Foresight report, The Future of Food and Farming. This report was addressed not just to government but also to the private sector and civil society. It was a comprehensive agenda for achieving global food security. Indeed, as we were reminded just now, it is part of a convoy of reports, committees and meetings which have come in something of a rush. Sir John Beddington also chaired the latest report, produced by the international Commission on Sustainable Agriculture and Climate Change, which had the advantage of a much greater international dimension and the participation of both developing and developed economies. However, the essential message of both reports was the same—that humanity faces very difficult trade-offs in producing sufficient food to feed the growing global population.

Our present food system is clearly unsustainable, inadequate and failing in some respects. It does not provide adequate nutrition for all. Through inappropriate subsidies and adverse financial instruments, it disadvantages producers in some regions suffering food insecurity. Agriculture contributes to a loss of biodiversity and leads to leaks into the soil, air and water, not least of greenhouse gases. Agricultural systems also often lack resilience to climate change, natural disasters and other shocks and stresses. However, although it is easy to blame agriculture for a multitude of sins, one must recognise that as soon as you start manipulating the environment, there will inevitably be leakages and a loss of biodiversity. The question is not whether agriculture is guilty of causing these, but whether there are better production systems that can reduce the adverse effects and, in some ways, ameliorate the situation and contribute to the green economy, which agriculture around the world can certainly do.

In looking at the essential components of sustainable agriculture we must, first and foremost, simply look at the economics. Unless it is profitable for a producer on any scale—whether global agriculture, a large corporate company or a small-scale farmer—and there is an adequate return on their investment, there simply will not be sustainable agriculture. It will stop. That is a fundamental law of economics.

We must recognise that now, for the first time in the history of the world, we have a population that is centred more on urban areas than in rural communities. Therefore, it follows that the rural communities must be able to support those who live in cities. This requires appropriate investment, governance—equitable land tenure is often a problem—and, above all, infrastructure in the form of roads, storage and market information. It also requires access to extension services and education. We must not ignore the fact that the ability to control human fertility—or at least for a family to control its own fertility—is clearly something that must be taken seriously and considered carefully. All this must be underpinned by appropriate agricultural research and development.

The other elements of sustainable agriculture include a move towards reducing dependence on fossil fuels; reducing the unsustainable exploitation of natural resources; a more economic use of available water, 70% of which is used in irrigation around the world; and contributing to carbon storage through increased use of biomass and reducing leakages.

The problems of food security are very different in different parts of the world. In south-east Asia, which is clearly one area where food insecurity can be a major issue, the problem is to do with urbanisation. There are already large cities, which are getting larger. Problems arise from the disease of crops, pollution and the steady increase in urbanisation. The issues in Africa, where there is perhaps greater insecurity, often arise from the lack of economic opportunity, the lack of fertiliser and massive urbanisation—starting from a much lower base, admittedly—which has increased by around 50% in the past 10 years or so. You can see dramatic changes. A question arises: how will this massively changing demography in Africa and elsewhere be supported? Who will be able to do the production? Agricultural systems that are fit for purpose will be needed. Agriculture will change, whatever the scale on which it operates.

Therefore, there are opportunities for the rest of the world, not least the United Kingdom, to participate in supporting and underpinning the agricultural sciences. That will involve the biological sciences, the use of water and furthering our understanding of nitrogen. We have been exploring that for many years but we are only beginning to understand some of the opportunities to use more efficient systems. Genomics and other new sciences are already showing benefits in animal and plant breeding, even with so-called orphan crops—those that are not so readily traded in international markets. On emerging technologies, my noble friend referred to GM but one could refer also to nanotechnology and others. It would be simply rash, to say the least, to say that none of these was appropriate. They may or may not be appropriate; there must be a proper risk assessment.

It will not be agricultural science that delivers totally. Financial services, the communications sector and a whole raft of interventions—political, economic, sociological and technological—will be involved. I gather that there will be a new version of the Foresight report soon, which I am delighted to hear. It must spell out in detail the targets and measurements of success for each of those interventions.

My Lords, I also thank the noble Baroness, Lady Miller, for initiating this debate on a manifestly important topic. I speak as a member of the aforementioned Sub-Committee D. I know that other members are here, too; they all seem to be clustered on the other side for some reason. As the noble Baroness mentioned, food security has zoomed up the global agenda in recent years, and rightly so. A range of reports have been referred to, a number of them from the UN. There is the Royal Society report, Reaping the Benefits, and the Government’s Foresight report, which is one of the best to be produced on this issue recently.

As the reports do, I want to discuss the issue on a global level. Noble Lords will forgive my being slightly didactic by sketching the backdrop to the world as I see it today. The industrial civilisation in which we live is spreading across the world. It is the first truly global civilisation in history and is far more advanced than any other civilisation has been. It is discontinuous with previous civilisations. Looking at the history of civilisations, one observes that they tend to go down a little and then gradually up. Around 1850, civilisation starts to rise steeply. I suggest that we have essentially created a new world, with which we do not have experience of dealing by looking at history. This is one reason why it is so hard to cope with the risks that we have created. Essentially, we face what I call “new-style risks”, associated with the globalisation of industrial civilisation.

New-style risks are not like old-style risks, which can be covered by insurance companies. I can unfortunately tell you your chances of being involved in an accident every time you get into a car, because there is a long series of events on which to base them. With new-style risks, which are about present trends accelerating into the future, you cannot use that kind of risk calculation. That is one of the reasons why we tend to be in denial about those risks. We are in a civilisation in which the risks that we have created for ourselves—these are all humanly created risks—are rising steeply, but we are not in a world that is getting close to managing their consequences, or even to accepting their seriousness.

Climate change is the granddaddy of all these things. Imagine it: we are on the verge of radically and irretrievably changing the world’s climate. There is no way of getting greenhouses gases out of the atmosphere once they are there and they will be there for centuries. What are we doing? Virtually nothing. Anyone who saw the IEA report that came out today will see that the amount of CO2 in the atmosphere is still increasing, not decreasing, and it is increasing by more every 10 years than it did in the years before.

Three of the biggest new-style risks are climate change, population growth and world urbanisation. We have no experience of any of these. In 1850 there were still fewer than a billion people in the world. It is not that long ago in historical terms. We are now almost certainly coming up to there being 9 billion people not that far into the future. This is likely to happen, and some people think that there could be as many as 11 billion. This is an extraordinary transformation in the history of the world; it is totally different from anything that we have had to deal with before.

In the case of food security, each of those three risks—climate change, population growth and urbanisation—overlap. Sir John Beddington, who was referred to earlier, spoke of a perfect storm affecting the future of world society. He said that from a 2010 baseline we would need to create 40% more food, 30% more water and 50% more energy by 2050. Failure to generate these could produce massive conflicts over diminishing resources. To me, the world is like that old joke. A guy jumps off a skyscraper—in the City of London, let us say—and, as he falls, people on every floor hear him say, “So far so good, so far so good”. That is about our approach to the risks that we face globally. We have to get on with it. We have to make far more of a dent in these risks than we have so far.

How can the UK contribute? In my view, it can contribute in four ways. First, the Government should support research, including blue-sky research, around the edges of nanotechnology, for example, and other areas that directly affect food production. We have to increase productivity of crops and their resilience in the face of climate change, as the Foresight report noted. Brazil has made amazing strides in these respects and we should learn from best practice around the world.

Secondly, as was said by the noble Earl, Lord Selborne, any solution must involve biotechnology, which I take to stretch quite a long way beyond GM crops, as well as conventional breeding techniques. Sir David King, another former Government Chief Scientific Adviser, got himself into trouble when he declared that food insecurity in Africa was partly the result of anti-GM campaigns. Obviously, there is a balance of risk. The risk of not feeding the world’s population is much larger, I think, than the risks involved in biotechnology.

Thirdly, we must counter changes in diet that are going on across the world and transforming our world dietary habits. It is weird to live in a world where 1 billion people go hungry and 1 billion people are obese or radically overweight. To me, the fast food corporations do not pick up the consequences of their advertising campaigns. They have to be picked up by publicly funded health services.

Finally, and fourthly, we must get to grips with food waste. It is estimated that some 40 per cent of food in the UK is wasted, if you include supermarkets, shops and restaurants. That is absurd in a world struggling to feed itself. I would welcome the Minister’s comments on any of these points.

My Lords, it gives me great pleasure to follow my noble friend because few Members of this House have contributed more to debates about agriculture and food, and the environment generally. Food security depends crucially on support for every kind of science and technology that increases yields, makes the best use of scarce available agricultural land, protects the environment, limits the emissions of greenhouse gases and feeds mankind without harm to health.

At Rothamsted Research, which is one of our oldest and most respected research institutes, a trial crop of genetically modified spring wheat is being tested in the field, with all these aims in mind. A group called Take The Flour Back has announced that it intends to destroy this crop next Sunday. The issues that this raises are enormously important, which is what I intend to talk about.

First, I should declare an interest. Ten years ago I founded the charity Sense About Science to promote good science and respect for evidence. Some anti-GM campaigners have denounced it as a pro-GM lobby group. It is nothing of the kind. It is a charity and not a lobby group. It has refused all financial support from the agricultural industry. In its first five years it was not concerned with genetic modification at all. While I have written and spoken about genetically modified crops, the charity has mostly concentrated on other subjects. Indeed, many of your Lordships have been closely associated with our work and have often expressed great appreciation of it.

Turning to the trial crops, the wheat has been modified by the insertion of a gene for a pheromone that repels aphids because it releases a chemical that they do not like. They do not like the smell. Furthermore, it also attracts the parasitic wasps which destroy aphids. Laboratory tests have produced good results but the trial is necessary to see if it works in the field.

Anti-GM campaigners say the crops have not been tested. They are right. That is what the trial, which the campaigners want to stop, is for. Who can justify suppressing evidence before you know what it shows? They allege that the wheat may be toxic to people and endanger our health. But the pheromone concerned is found naturally in some 400 other plants, many of which are consumed every day. For example, it is present in hops used for brewing beer. However, this is a trial and the crops are not for human consumption but to see if aphids are repelled in the field.

Campaigners are concerned about the environment—so they claim. They fear that the trials may spread the gene to other plants by cross-pollination. Wheat self-pollinates. Its pollen is heavy and is not blown far by the wind, and no cereals are grown within 20 metres of the site. But what harm could anti-aphid pheromones do that are already present in other plants? In fact, this wheat would greatly benefit the environment by reducing the need to protect it by spraying it with pesticides. At present, farmers can protect wheat only by spraying pesticides that kill the aphids.

What if the vandals succeed in destroying the crop? The environment will not benefit and the chance of developing a worthwhile crop that would reduce the use of pesticides will be lost. Publicly funded research will suffer. The cost of security for protecting trial crops from vandals is huge and only large companies can afford such trials. But this modified wheat will not be patented and will be supplied to farmers at minimum cost. The potential benefits of genetically improving crops will be held back. They are needed as one of the instruments to fight against hunger, global warming and water shortage. Outside Europe, they have been a huge success. The fastest increase in uptake of the cultivation of genetically modified crops is among small-scale farmers and more than 15 million of them in the developing world now grow GM crops. After more than 12 years of experience, no evidence of harm to the environment or to human health from genetically modified crops has been found by any top scientific academy anywhere in the world.

Finally, democracy suffers if a tiny minority can impose its view against all the evidence, prevent the acquisition of important knowledge and decide which scientific experiments may or may not be permitted. This happens in dictatorships; it should not happen in a liberal democracy.

My Lords, I join other speakers in thanking the noble Baroness, Lady Miller, for raising this vital issue. In my remarks, I shall draw on my experience as a professor of economics at the London School of Economics, my work on development issues for four decades, and my experience as chief economist of the World Bank.

Let us be clear at the outset on one key practical and conceptual proposition, which is vital for the understanding of this issue and for the construction of policy. I hope that it is obvious, but it is important. People go hungry or starve because they do not have the wherewithal to acquire food. Usually, they do not have the income to buy food because of all the prices that they face. For subsistence farmers this may arise because their farming activities have failed; for agricultural workers it may be because droughts or floods are so bad that employment has collapsed; or, for workers outside agriculture, it may be because there is severe unemployment or underemployment. Thus, this issue concerns the real incomes of very poor people. It is about poverty.

Noble Lords do not have to worry much about their own food security because our incomes are sufficiently high. We make a serious analytical and policy mistake if we argue that food security is simply about food supply or fluctuations in agricultural markets, important though they both are. Thus, we should support DfID and other development institutions in their focus on raising incomes and fighting poverty wherever it is in the world. We also should support DfID in its emphasis on entrepreneurship and private sector opportunities in raising the incomes of poor people. We should encourage all development institutions to continue to devote their energies to health and education, which is key to opportunity, particularly for women. As I said in my maiden speech, the evidence is clear that women generally make better use of opportunities and allocate resources more wisely and responsibly than men.

The volatility of food price and the availability of food matter. Locally, these depend not only on how markets function but also on transport and storage infrastructure, and governance. Thus, for example, it is crucial that food can flow into areas of food shortage and that this is not prevented by trade restrictions, internal and external, as we have seen all too often. And it is no good having decent roads, even assuming you do, if these are vulnerable to highwaymen and hijacking, even occasionally by those associated with government. Thus DfID and other development institutions are right to focus on governance.

Having said that, it is clearly vital to examine food production in a world where population is likely to grow from 7 billion to 9 billion or more in the next 40 years. As my friend from the LSE, the noble Lord, Lord Giddens, emphasised, in many parts of the world, particularly the rich world, food and resources are wasted by casualness or greed. But throughout the world they are wasted as a result of bad policy, poor storage and weak infrastructure. A recent McKinsey report on the waste of these resources has documented in great detail this waste. Thus there is great scope around the world for raising the productivity of land, water and energy by better techniques and policy. How this is done should be a priority for governments and development institutions, which all too often have drifted away from rural and agricultural issues.

I give five examples. First, using degraded land in Indonesia could make a major contribution to increasing food production, reducing greenhouse gases and increasing incomes. Secondly, in Brazil there is one head of cattle per hectare. That cannot be a good use of land. The animal has to look for about 100 metres before it sees a friend; it must be pretty lonely. Thirdly, slash and burn agriculture is widespread across the world. Fourthly, water and energy in India are squandered by the unwillingness and inability to price properly, thus also restricting vital investment. Finally, agricultural research could deliver on great potential, ranging as others have remarked from low-till agriculture, to better seeds, to the use of algae for protein in animal feed, which could substitute, for example, for soya and reduce the pressure on rainforests.

I must also stress the extraordinarily destructive potential of climate change. Its effects are largely in terms of water—that means floods and inundations; storms; drought and desertification; and sea-level rises and sea surges. They all damage livelihoods, especially of poor people. We saw the effects, for example, of the floods in Pakistan in 2010, when one-fifth of the country was under water and 20 million people were directly affected. We see now the devastating effects of the continuing drought in north-east Africa. Both events are likely to have been strongly influenced by climate change. I invite noble Lords to consult chapters 3 and 4 of the report that has just been published by the International Food Policy Research Institute on the impacts of natural disasters and their links with climate change on agriculture and food security. We are seeing all this on the back of just 0.8 degrees centigrade increase in global surface temperature since the 19th century. On current policies, we may be heading for 3, 4, or 5 degrees centigrade by the end of the century above the benchmark 19th century level. At the higher levels of possible temperature, hundreds of millions, possibly billions, would have to move. That would likely result in the generation of the greatest insecurity of all—extended and severe conflict.

There is a great deal we can do across the board to reduce emissions, particularly in agriculture. For example, we can increase land and water productivity, and thereby reduce pressure on forests. And we can work to realise the great potential in second generation biofuels, including cellulosic ethanol. This means that food and biofuels become complements, not competitors and substitutes; cellulosic ethanol is made from the waste from, for example, corn or wheat after the grain has been extracted.

As I conclude, I pose two specific questions to the Government. Why has the UK failed to meet its commitments made at the 2009 G8 summit in Aquila in Italy on agriculture and food security? If I understand the numbers correctly, the UK committed $1.7 billion of the $22 billion total, with delivery estimated within three years. So far, the UK has fulfilled only around 30% of its pledge. Given the Secretary of State’s commitment to supporting the Prince of Wales initiative calling governments around the world to undertake an economic review of their national food security, what progress has been made?

Food security is largely about economic development and overcoming poverty. No doubt resources in the rich world are under great pressure at this time of economic crisis, a crisis which we have ourselves created in the rich world. But this is surely not a time for us to forget that we are rich and it is not a time to forget about our common humanity.

My Lords, I offer some thoughts about food security from the perspective of international development. We have had some amazing, impressive and helpful perspectives about scientific and technological approaches, and I want to offer some thoughts from the perspective of people who suffer from the need of food and that element of the food security issue.

Noble Lords will know that the Christian faith operates through people gathering around a table to share food—people of any culture or race. That is a great picture of an international family and sharing around a common table, which most human hearts can assent to and desire. As we have just heard from the noble Lord, Lord Stern and others, the fact is that many people do not participate or do not even feel that they are at a common table. That is the risk of the food security issue, which is why I welcome the Government’s concern—and the statement from the Prime Minister yesterday about a summit to consider those issues during the Olympics, when a lot of people will be in this country.

Christians also talk about word and sacrament—that is, you do not just talk about things, you have to do things and act them out as a sign of how things could be better. That is what people who feel excluded from the table are looking for and longing for. We have heard from the noble Lord, Lord Giddens, about growing population, and about climate change and industrialisation. All those things are threatening the sustainability of human life across the globe for millions of people. Therefore, we have to look at our own consumption patterns and the needs and demands of our brothers and sisters.

I am not going to push this common table analogy too far, but I shall make one last reference. St Paul, writing at a very early stage of Christians trying to gather round a common table, noticed in Corinth that some people took a whole lot of food and drink and got drunk and had a good time and quite a lot of other people did not have anything at all and were not noticed. That is a pretty sharp picture of what human behaviour is often like.

There are two ways of looking at that in our own context. One is the issue of what is called tax justice, for which I have a particular concern. In many countries where crops are grown the result and profit of that enterprise is not reinvested in the country for the well-being of the people who could be round the table in that part of the world; it is shifted out and piled up in front of other people in another part of the table so that they can live well and other people are excluded. That is happening more and more, and is a very major issue about food security. By contrast, Christian Aid, Oxfam and other agencies are trying to work in partnership with people on the ground. One billion people are either landless or small farmers; they need folks alongside them to see their needs and then to use the technology and wisdom that is around to grow things from the bottom up, in partnership with people who are excluded from the table and suffering enormously.

I ask four things of the Government. First, can they target their investment in the area of food need and security to have a special emphasis on the partnership with local people through agencies that can work through genuinely local people, discern their needs and target the technology and food changes appropriately? Secondly, what is the Government’s view on tax justice, which is excluding many and piling up the resources from agriculture in a very few places for the benefit of a very few people. Thirdly, how are the Government going to continue to monitor global institutions such as the UN and the World Bank so that their policies take account of the partnership needs of people at a micro level and not simply just act at a macro level? Fourthly, as we have heard, there is an issue about obesity in our own society, which is costing a fortune. How can the Government take a lead on our own consumption patterns, and on how we literally pile up trolleys in the supermarket and act out what St Paul warned us against—of looking after ourselves and ignoring others? That might say something about advertising and other ways in which messages are conveyed in our society.

I congratulate the Government on their concern with this area. I hope that they consider some of these questions and pay particular concern to human beings—brothers and sisters—on the ground, who need partnership and targeted and tangible signs of hope.

My Lords, I, too, thank my noble friend Lady Miller for initiating this important and timely debate. Just a few days ago, food security was an issue discussed by the G8 leaders with those of Benin, Ethiopia, Ghana and Tanzania. It must remain our overriding objective that all people have access to sufficient, safe and nutritious food to meet their dietary needs. Indeed, as President Obama put it:

“You cannot have stability and security as long as regions and countries and communities are deeply food-insecure”.

I would also include adequate water supply in the essentials of stability.

The brief sent by Save the Children highlighted its work on the global crisis of malnutrition. It is a shocking fact that every hour of every day 300 children die because of malnutrition. Lack of food, particularly in Africa, is becoming ever more acute and grave. Over 18 million people across west Africa face a growing hunger crisis triggered by crop shortages, rising food prices and political insecurities.

The moral obligation to help tackle this crisis is not just for government but extends to civil society organisations and business. Through the Department for International Development, the UK Government are contributing to tackling the issue of food security. One of the department’s key approaches is working with international partners, Governments and private sector and civil society organisations to create an environment that supports farmers and agricultural development. The G8 leaders pledged to promote investments in sustainable agriculture as a strategy for taking millions of Africans out of poverty. That pledge includes securing private sector financial support. Indeed, DfID has announced that 45 leading firms, including Diageo, Unilever and Vodafone, will invest £2.5 billion in developing African agriculture and sign up to a new code of responsible investment. That investment is hugely encouraging and private businesses, with their resources and expertise, can help to advance agricultural sectors in developing countries so that they can lift themselves from poverty, hunger and malnutrition.

As the world’s population continues to grow, the issue of food security will become ever more pressing. Much of the demand will be driven by developing countries, but British farmers will have an ever more important role in meeting this demand not only at home, but abroad by increasing agricultural exports. British farmers are fundamental to domestic food supply; I should declare my farming interest. We have seen a decline in food self-sufficiency here over the last 30 years. Defra statistics show that the UK’s self-sufficiency has consistently dropped since the highs of the 1980s. In terms of the UK’s self-sufficiency in all food types, in 2009 the figure was 59%, down from a high of 78% in 1984. We have the expertise and agricultural skills to reverse that, without jeopardising the farmers’ essential role in the custodianship of the land and environment. The British farmer is responsive to the diverse set of requirements that we place on the countryside—habitat, biodiversity, recreation and tranquillity, alongside food production. We all increasingly recognise the balance that has to be struck.

To meet future demand for food, production needs to increase, but in an environmentally sensitive way so that we avoid creating even bigger problems. Agricultural science will play a vital role in raising productivity. Through better animal disease control, improved irrigation and water management practices, and better fertilisers, food yields can be increased in an environmentally sustainable way. British scientists will have much to contribute in this regard and, while we all recognise the challenging economic times in which we live, these are people in whom we must invest for the future.

We have been asked to take note,

“of the Government’s policies on food security”.

I am extremely glad that under this Government it is recognised that there is a need for policies on food security both at home and abroad. Increasing imports is no longer the answer. We are extremely fortunate to have Ministers in Defra who come to their task with direct and practical experience of agriculture. As the noble Lord, Lord Giddens, said, the challenges for the world are immense and, by 2050, 40% more food, 30% more water and 50% more energy will be required. Those are not figures for the faint-hearted, but with resolution and ingenuity we must rise to those challenges.

My Lords, I, too, thank the noble Baroness for having introduced this debate so well. Her instinctive priorities are, as usual, absolutely right. I should declare an interest as a former director of Oxfam and as a trustee of Saferworld.

For many millions across Africa, world food security is a distant dream; food insecurity is the endless reality as they struggle to survive. As of today in west Africa, hunger affects more than 18 million people, with approaching 1.5 million children suffering acute malnutrition and 3 million at risk. Violence and turmoil in Libya, Nigeria, Ivory Coast and northern Mali have reduced regional employment opportunities. With its front-line experience, World Vision recently described how the migrant workers of Niger have had to return home, and now clashes in Mali have resulted in 300,000 internally displaced people. World Vision tells of 255,000 refugees arriving in the region of Tillabéri, one of the areas already worst affected by food shortages in Niger. All that has made a grave regional situation still worse; 50% of children under five suffer chronic malnutrition, leading to the death of 300,000 children from causes rooted in that.

Droughts and food shortages are not new to the region, but climate change is accelerating the rate at which they come. There used to be longer periods of separation, which enabled communities to restore their means of livelihood—their crops and livestock—and to rebuild their resilience. The immediate crisis is just two years after the 2009-10 crisis, which was only five years after the 2004-05 crisis. We are not only talking about west Africa. Half the population—4.7 million people—in South Sudan are threatened by food insecurity; in the Horn of Africa, 9 million people are food insecure; the BBC reports that 10 million are food insecure in Yemen, with all its globally dangerous political tensions, and that 5 million require emergency aid; and there are reports of increasing food insecurity across southern Africa.

The immediate, appalling suffering and disease are not anything like the whole story. There are long-term consequences for the productivity of people acutely weakened by hunger, the long-term adverse effect on mental and physical health, the impossible pressures on already minimal health services and the seriously negative impact on school attendance, with all that that inevitably means for the future.

The UK Government deserve credit for having remained committed to their overall targets and to their L’Aquila undertakings on global hunger. Their commitment to fund the Global Agriculture and Food Security Programme with £20 million in its first year was also welcome. These help to provide moral authority to push hard for a more ambitious programme on food and agriculture when the UK hosts the G8 summit next year.

At its recent Camp David meeting, the G8 focused a little on food, nutrition and agriculture. However, those discussions achieved only what Oxfam has described as,

“a shrinking solution to a growing problem”.

It is disturbing that the members of the G8 have together funded only half of the $22 billion that was promised three years ago to fund agriculture in developing countries.

There are other in effect more sinister—some would say—issues strategically affecting food security. Like the noble Baroness, Lady Miller, in its current Grow campaign Oxfam spotlights land grabs. Demand for land has soared as investors look for places to grow food for export or crops for biofuels, or simply to buy up land for profit. In too many instances, land sold as unused or undeveloped is in fact being used by poor families to grow food. The Land Matrix database includes deals that are reported as approved or under negotiation worldwide between 2000 and 2010 as amounting to 203 million hectares. This is equivalent to over eight times the size of the United Kingdom. Too often these deals trample over the rights of local people.

Back in May 2001, the Committee on World Food Security agreed voluntary guidelines on the responsible governance of tenure of land, fisheries and forests in the context of national food security. These represent the first international norms on tenure of land and other natural resources. They are a significant first step towards ensuring that local communities are empowered to stop land grabs and to benefit themselves from responsible investments. They are not perfect but they are a start. What specifically are the Government doing to highlight these guidelines and to encourage their application? I hope that the Minister will cover this in his reply.

Biofuels are a major driver of food price rises and volatility. As the report by the Committee on World Food Security high-level panel of experts has underlined:

“Biofuel support policies in the US and the EU have created a demand shock that is widely considered to be one of the major causes of the international food price rise of 2007/8”.

That report stresses that such policies increase vulnerability and inequity in the overall distribution of food. The European Commission is currently preparing a report to look at the increased EU demand for biofuels in supplier countries. This provides a real opportunity to ensure that the negative impacts of biofuels both on food prices and in driving land grabs in developing countries are taken into account in the EU’s renewable energy directive. I hope that Ministers are as a priority engaging with those in the EU who are preparing this report and are taking the opportunity to influence the report in the light of our own experience. I am convinced that DfID has a very constructive part to play in that process and I hope that the Government will encourage it to do that.

My Lords, I, too, thank my colleague, my noble friend Lady Miller, for initiating this debate. As another member of the aforementioned EU Sub-Committee D, I know that we are only too aware of the challenge of providing nutritious food in the face of a growing population, increasing resource constraints and the effects of climate change.

It has been estimated that food accounts for a third of Europe’s greenhouse gas impacts. Reducing the greenhouse gas emissions from nitrous oxide, carbon dioxide and methane produced from agriculture is key if we are to make food production more sustainable. To that end, I welcome the £12.6 million committed by Defra and the devolved Administrations to research the impacts of greenhouse gases in agriculture. The UK Government need to co-ordinate and work with private and public partners to ensure research and development priorities support sustainable diets, looking at how we can grow crops using less water, delivering greater nutritional benefit and reducing reliance on fertiliser and pesticides. Research priorities must support both agro-ecological farming practices as well as projects for agricultural development based on cutting-edge science. Why? Because GM technology is no silver bullet, as the Foresight report, The Future of Food and Farming, rightly concludes.

Public opinion in the UK remains sceptical of the technology and without public consent products will not be sold in supermarkets. As a representative of the retail industry put it to me recently, “The public will accept GM foods only when they are on a cliff edge with nowhere else to go”. Before any decisions about GM cultivation in the UK are made, two things must happen. First, the UK Government must have the evidence on the environmental impacts and potential for cross-contamination of other farming regimes by GM crops. Two weeks ago, the House of Commons Environmental Audit Committee called on the Government to set up an independent body to research, evaluate and report on the potential impacts of GM crops on the environment, farming and global food systems. The committee is right that an initial focus of such research should be on the scope for, and risks of, the co-existence of GM crops with conventional and organic farming regimes. As my noble friend Lord Taverne rightly said, this would enable us to make the science-based decisions required.

Secondly, no decisions about GMOs should be made without clear evidence of public acceptance of GM food. Food is essential to all citizens and they have the right to be part of the decision-making process. Next year marks a decade since the previous Government’s national conversation on GM food. This Government must engage now with a sceptical public in a way that ensures that they are well informed on this issue.

Consumers are central to the issue of food security in another way, too. We need to reduce global consumer demand for and consumption of resource-intensive meats and dairy and move towards a larger share of diets being plant-based. To do that, we need to empower consumers to make positive food choices. In the past decade, the Food Standards Agency created its eatwell plate to promote a healthy, balanced diet, and last year WWF produced the livewell plate, which shows the proportions of different food groups that people should consume to achieve both a sustainable and a healthy diet. Does the Minister agree that, as the right reverend Prelate suggested, this Government have a role in producing public advice and guidance on what to eat to be healthy and sustainable?

What we waste is as important as what we eat. The noble Lord, Lord Giddens, rightly highlighted that 40% of food in the UK is wasted. Up to half of that food waste comes from households. Good progress has been made by retailers and local authorities, with government support, to cut that figure, but we need to reuse food that does not need to be thrown away and recycle that which is not fit for consumption. Charities such as FareShare and FoodCycle are working hard to reduce food waste and food poverty by taking surplus food and delivering it as food parcels and warm healthy meals to people in the local community. The Government should do all that they can to promote the redistribution of surplus food to charities.

There needs to be more focus on stopping food waste going to landfill. If placed in landfill, food waste releases methane, which is 21 times more powerful than CO2. In reviewing the UK’s waste policy, the Government should set a target date for their stated aim of no food waste to landfill. A deadline of 2020 would certainly focus minds. In the mean time, local authorities should be encouraged to increase the separate collection of food waste as well as increasing the resilience of their local food economies.

A number of major towns, cities and counties, including London, Sheffield, Kent and Brighton, are working hard to promote local food security. Bristol City Council, through its food plan, is pioneering in the UK a food systems planning process that supports the development of a resilient food system: safeguarding land for food; increasing urban food production and distribution; protecting key infrastructure for local food supply; supporting community food enterprise models; and safeguarding the diversity of food retail. I would like to see the Government encouraging every city to produce a food plan as a means to increase food resilience, support local food businesses and help more people get involved with food production.

In conclusion, tackling the challenge of delivering food security in the UK will require action at all levels: the Government, local authorities, industry and consumers. An important step to delivering co-ordinated action by all those players would be for the coalition Government to produce their own national food strategy. There is widespread support for such an initiative, including from producer representatives such as the NFU and major retailers. In his reply, I hope that the Minister will comment on whether the Government intend to produce such a strategy and a delivery plan that should focus on both the sustainable production and the sustainable consumption of the UK’s food.

My Lords, I echo many in this House who have expressed appreciation to the noble Baroness, Lady Miller, for introducing this debate.

We have heard how fortunate we are to live in the United Kingdom, where there is food and safe water for the majority. I say the majority, but an increasing number of food banks are operating in the United Kingdom, often through the churches and faith communities, ably supported by the Trussell Trust. The poorest in our society are subject to food insecurity, and this should not be forgotten in the broad range of other issues that we are discussing.

I am fortunate to live in a part of the country, Suffolk, that is a proud food producer that is conscious of its own brands and makes the most of that. However, it is not a complacent part of the country. Early on in my time there, I met a group of Christian farmers and others who were acutely aware of the issues of availability of grain stocks throughout the world. We met during a severe shortage, and there were only days left before the stocks ran out. Those people were aware of their place in the food chain throughout the world.

New Anglia local enterprise partnership has green pathfinder status from the Government and is spearheading ideas about sustainability. The east of England is well placed to strengthen a local approach to sustainability and to see whether market towns might be re-established as centres for local trade in food. There is a question about how local sustainability can be achieved in a proper balance with the large retailers. We heard in debates earlier this week how the supermarkets have delivered huge benefits and provide a great variety of food at low cost. However, as fuel costs rise and questions about the sustainability of imports come to us, a more local and complementary approach is surely essential.

However, considering the size of the agri-food sector, we cannot go into a rural idyll thinking that we can all go back to our roots. It is the UK’s largest manufacturing centre and a major source of employment to around 3 million people. Half a million are employed in primary production on land and sea. It is a significant sector.

Sustainable agriculture, as we have heard, will depend on first-class scientific research. Supporting that and overcoming its negative image will be vital. This is where education comes in. The land available is finite. We are also concerned to retain our biodiversity and all the habitats for wildlife. Those issues are all too easily lost in giving over land to biofuel production and other sources. Achieving these aims requires investment in people. We have already heard anxieties about young people going into agriculture—and that is certainly right. I gather that the average age of a farmer in this country is 58. Where are the accessible routes for young people to enter agriculture?

However, there is one sector of food production that we have not yet touched on. In February this year, I was privileged to attend a consultation at St George’s House, Windsor, relating to the fishing industry in this country. St George’s House, like many other church-based institutions, is able to convene groups. The whole subject was confronted by scientists, producers, retailers, community health experts and politicians. The complexity of sustainable fishing could not have been clearer, as were the real possibilities of what might be done. The fishing industry is highly regulated. It is a small sector but has a huge number of regulations that rival even anything that faces our farmers. The industry has radically changed over the years. Incidentally, while the supermarkets have been coming in for hard questioning in recent debates, the representatives of major retailers at this conference showed a clear and advanced understanding of sustainability, and had clear policies on where they sourced their fish and what they were prepared to buy. I commend to noble Lords the report of that conference.

The social and cultural aspects of food production, and indeed consumption, are vital, as noble Lords have said. It is a tough question, but one that we should ask. How can our expectation of continuing to eat the diet that we enjoy be modified? We have heard one idea about moving away from meat and dairy to more plant-based consumption, but how do we face up to the issues of overconsumption and obesity? We have heard much about that and I have a load of horrific figures, but there is no point repeating them. It is all very obvious. There is also the issue of food waste. My figures suggest that up to 5.3 million tonnes of available food is wasted each year, at a cost of £12 billion or £480 for an average household.

This is why education is so important. The things that help children and young people to understand more about the country are much to be commended. The Suffolk Agricultural Association buses in thousands of primary school children each year to look at the processes of agriculture just before the Suffolk Show every year, and pays for the transport so that schools are not faced with those costs. That sort of education will be vital for the future, and I hope that many other related initiatives will find increasing government support.

I echo what has been said. There is a complex task ahead of us, but if we are to ensure that all have access to good quality, affordable and nutritious food—worldwide and at home—sustainability has to be a top priority for government.

My Lords, I, too, am grateful to the noble Baroness, Lady Miller of Chilthorne Domer, for introducing this debate. We could do with far more than two and a half hours to discuss such a major difficulty that faces us.

The Commission on Sustainable Agriculture and Climate Change produced in March this year another report, Achieving Food Security in the Face of Climate Change. It is an excellent report, but my initial thought was that mankind has faced climate change since mankind appeared on the scene. There have been at least 75 major temperature swings in the past 4,500 years. Indeed, the Norse empire was brought to an end when the west coast of Greenland became uninhabitable at the start of the mini ice age in the early 1300s.

However, one finds on page 6 of the report a sentence that sums up the problems that we face:

“Agriculture is at the nexus of three of the greatest challenges of the 21st century—achieving food security, adapting to climate change, and mitigating climate change while critical resources such as water, energy and land become increasingly scarce”.

That is a very good summary of the problem that we face and we have to set it against population growth in the world. For the first time, 50% of the world’s population lives in urban surroundings. As my noble friend Lord Gardiner and the noble Lord, Lord Giddens, said, we will need 30% more water, 50% more energy and 40% more food by the middle of this century, and we are getting towards the halfway mark for that. There are 7 billion people in the world and one has to remember that 20% of them—about 1.5 billion—are dependent on land that is currently degrading. Therefore, even if there were no increase in the population, the problems would already be getting more acute.

Water has also been mentioned and there are undoubtedly going to be considerable problems there. The population on the banks of the Nile is expected to double to 300 million by 2025. Looking further afield into Asia, there is the potential for water wars. If one thinks that China is going to build eight dams in the foreseeable future, taking water away from Myanmar, Thailand, Laos, Cambodia and Vietnam, one can see that the existing problems are going to be exacerbated by another country’s actions. How fortunate we are that we live on a funny little island off the north-west coast of Europe and that the only rivers we share are between Northern Ireland and Ireland, and a couple of rivers between Scotland and England. We do not have a problem compared with the rest of the world.

We have talked a little bit about waste and diet but what has not been mentioned is that food for the poorest 10% of households in the UK accounts for 15% of their budget, whereas for the richest 10% it is only 7%. Therefore, any hike in food prices will increasingly hit the poor.

It is terribly easy to set out the problems. Every noble Lord has done that and they are all experts on this, whereas I am not. However, it is much harder to set out the solutions. One can find some solutions in the report of EU Sub-Committee D. I am the third member of that sub-committee to speak today and there are two quotations that I should like to read out. The first is in Chapter 1—the introduction—and is from Mr Paolo de Castro, MEP, chairman of the Agriculture Committee of the European Parliament:

“In my mind, agriculture is at the centre of an Innovation Union and the new global challenge”.

A further quotation comes from the beginning of Chapter 6:

“We in Europe are sitting here saying, ‘Agriculture is the old economy’, in what I call an innovation-hostile environment”.

That was said by the head of cabinet of DG Agriculture. That, I think, highlights the problem that we face. Any solutions that we put forward are going to be hampered by the institutional framework in which we work and also by politicians—that is, politicians with a small “p”.

A recent report that we have just published concerns water—the problem of fresh water in Europe and the difficulties that that is going to pose for us. One of our recommendations is that in certain circumstances water prices will have to rise. Again, for the poorest in the country that will come as a nasty shock. Which politician standing for election wants to go around saying that food and water prices will have to rise? There is a small political negative in all that. It is also very difficult for politicians to tell the rich that in future they will have to eat less, particularly less meat, when, as one gets increasingly affluent—and there are more and more affluent people throughout the world—the one thing one wants to do is to eat meat and more of it.

Going back to the institutional framework in which we work, I again draw your Lordships’ attention to our report on innovation. With diseases such as bluetongue and the latest Ug99, rust in wheat, we have to have new technologies and innovation. At the moment, that is all tied up with the words “genetically modified foods”, but that is a very blunt term—rather like using the drought to cover every water shortage. We have to use biotechnology, just as we use nuclear as part of the energy solution. However, at the moment, the EU is preventing that innovation. Its reaction to innovation in the GM world is rather like a wet hen behaving badly in a thunder storm. We have to do more and I hope that my noble friend and the Government will pursue this matter in Europe because, without innovation and support for the research at Rothamsted that my noble friend has just mentioned, we will go backwards, not forwards.

My Lords, I, too, thank my noble friend Lady Miller for introducing this timely debate. I declare myself the fourth member of Sub-Committee D to be speaking in this debate.

I spent the first half of April in Egypt. While wondering about the degree to which methods of cultivation seemed to have changed very little over the past few millennia—donkeys still seem to be the main means of transport—I nevertheless found fascinating the narrow bands on each side of the floodplain of the Nile that had been the centre of civilisation three or four millennia ago. When we returned to the UK, there was an interesting programme on BBC Four, which I happened to see, about the sudden collapse of the first kingdom in about 2000 BC. What had been a relatively high level of civilisation suddenly disintegrated. Archaeologists are increasingly of the view that the reason was a major famine caused by the failure of the rains in the upper Nile valleys in what are now Uganda and Southern Sudan, which feed the Nile. Luxor, where we were, had not received any rain for 46 years, but the Nile had traditionally provided the fertility of the Nile valley.

When the Nile failed, the fertility of the valley failed. Hieroglyphs of that period, around 2000 BC, indicated that it was a very serious famine. They were stories about people having to resort to eating their own babies and years of famine—the sort of famines there are now in west Africa and the Horn of Africa, which the noble Lord, Lord Judd, spoke about. This lasted for something like 20 or 30 years—the sort of thing that the Murray-Darling valley in Australia has seen. In those days, of course, there were no global programmes to help. Today, we exist in a global world, but the issue of food security hit home, as did the degree to which crises of this sort destabilise political systems. There are lessons that we can learn today.

The Foresight programme and report, The Future of Food and Farming, put together the four issues that John Beddington, the Government Chief Scientific Adviser, talks about as his perfect storm: population growth, climate change, the exhaustion of easily accessible fossil fuel energy, and increasing competition for water resources. Above all is the issue of population growth—from 7 billion today to an expected 9 billion, or even more, in 2050.

The key question for food security is: will we be able to feed all these people? In the 20th century, when arguably we faced an equally fast growth in population, we were able to do so by pulling more land into cultivation by the very profligate use of fossil fuel fertilisers—fossil fuels in the form of fertiliser—which underpinned the green revolution, and by building huge dams such as the Aswan and Three Gorges dams to provide for irrigation.

However, none of this is possible any longer. We need our forests and wilderness areas to absorb our carbon dioxide emissions. We are running out of easily accessible fossil fuel energy. Water resources are becoming increasingly scarce and expensive to manage and climate change is causing total unpredictability in rainfall, periods of drought, and so forth.

Nevertheless, I suppose I am slightly surprised at how optimistic in some senses the Foresight exercise was. There were three main messages in the priority themes that it picked out. First, it is vital to spread best practice. Knowledge transfer and exchange are the key to this. One of the problems that we face—this has come out in what many noble Lords have said—is that we have the knowledge today but people are not using it. It is therefore vital that we develop forms of farm advice and advice systems that spread the knowledge that we have. It is not necessarily a question of developing GM, although that may play a part. We must disseminate best practice.

Secondly, we need to invest much more in research and development. The noble Earl, Lord Caithness, mentioned the study on innovation that we in Sub-Committee D made. Out of that came the fact that the EU spends €400 billion on the CAP and only €2 billion on research. This will rise to about €4 billion, but it will still be a miserable 1% of the total. The European Union target is to spend 3% of GDP on research, which would equate to something like €12 billion. The UK’s research effort is, in relative terms, lower than that of Germany or France. We have superb, leading-edge research institutions, but again we fall down very badly on dissemination.

The final issue, to which my noble friend Lady Parminter referred, is reducing waste. It is appalling that more than 30% of the food produced in the world is wasted. The noble Lord, Lord Stern, spoke about the methods by which that waste could be easily prevented. So much could be used to feed those who are undernourished.

There are questions that we need to put to the Minister. Are we doing enough to promote research and development? Are we doing enough to disseminate knowledge and develop farm advisory systems? Are we doing enough both at home and in international circles to make sure that things are done? There is a great danger of feeling satisfied by coming to agreements in talking shops; the noble Lords, Lord Judd and Lord Stern, instanced the promises made in the G8 summit that were not met. What we are desperately looking for, both in this area and that of climate change, is leadership—not only from our Government but in the wider world—to try to get things done, as distinct from just talking about them.

My Lords, like other noble Lords I thank the noble Baroness, Lady Miller, for securing this extremely important debate. As many noble Lords said, the issue should be extremely high on both the domestic and international agendas.

While there is a high level of food security in the UK, there is also, as other noble Lords mentioned, a very high level of food waste. I will concentrate my remarks on that area. Shockingly, some 30% to 50% of all food produced is never consumed. In the developing world this is for a variety of reasons, which boil down to inadequate infrastructure or adverse weather conditions. In the developed world the problem is far more behavioural. People buy too much, are resistant to buying wonky fruit and vegetables and demand new and exciting food every night, with leftovers not being used. Food that is safe to eat—a total of 7 million tonnes a year—is chucked in the bin, largely because people are scared by stringent food labelling and cautious about sell-by and best-before dates.

Until a couple of decades ago, the old adage, “Waste not, want not”, was well understood, but today it no longer rings true. It is absolutely wrong that wonky and ugly fruit and veg, and offcuts of meat that we have forgotten how to cook, are thrown away. I recently came across Rubies in the Rubble, an admirable social enterprise based in Covent Garden market, which makes jams and chutneys out of surplus produce that would otherwise be sent to anaerobic digestion. Organisations such as this should be nurtured, encouraged and supported to ensure that productivity is born out of what would otherwise be wasted.

Earlier this month I participated—along with a number of other noble Lords including the Lord Speaker, who bravely took part during the week of State Opening—in the Live Below the Line challenge, living on £1 a day for five days for all our food and drink to draw attention to the 1.4 billion people who live on the equivalent of £1 a day every day of their lives for much more than their food and drink. Although we all found the challenge difficult, in this country we have such an abundance of choice that if I could not find a cheap tin of baked beans in one supermarket, I was bound to in the next. Incidentally, I was struck by the fact that cost of a tin of value baked beans had increased from 25p last year to 29p this year. We in this country have become accustomed to this huge choice, even when living on a tight budget, but is it really sustainable in the long term?

I should like to take this opportunity to draw attention to a couple of examples of innovative campaigns, all in their different ways making a real difference. Incredible Edible is a scheme that started in Todmorden in Yorkshire and has now spread to 23 towns and villages across the UK. From their beginnings with herb gardens, local people now plant and grow vegetables and fruit all around their town. They use land outside the fire station, the railway station, the health centre—where they replaced thousands of pounds worth of shrubs with apple and pear trees—turning all available local space into vegetable patches and herb plots for anyone in the town to come along, pick and take home their produce, promoting healthy living and a real sense of community, as well as the start of genuine local food security.

I commend the Mayor of London’s Capital Growth campaign, which aims to support 2,012 new growing spaces in London by the end of 2012. Currently at 1,719, it is an eminently achievable target. Jamie Oliver’s Kitchen Garden campaign and the Government’s task force, led by Garden Organic, are promoting vegetable patches in every school in order to further educate future generations and address the issue of food security, and at the same time are helping to reduce the growing epidemic of obesity in this country, which, as was referred to earlier, is another huge problem waiting for us down the track.

An appropriate infrastructure must be created to connect up demand and supply. As mentioned by the noble Baroness, Lady Parminter, FoodCycle, with its community cafés, and FareShare, which distributes surplus food to local charities and organisations—they are both known to the Minister—are tackling these issues at different levels of the supply chain, making sure that food that is still good gets to those who are at risk of food insecurity. For each of these different models, all tackling waste and food insecurity in different ways, there are many other local initiatives and examples. I ask the Minister please to do what he can to make it easy for such organisations to innovate and flourish.

I end by reading a short e-mail I received from a friend who sponsored me on my Live Below the Line challenge, which sums up in a very human way the challenge facing us all. It states:

“starting last Sunday I voluntarily decided I would see if a human could live off porridge for breakfast and dinner and 2 eggs for lunch, a glass of milk and a bunch of grapes a day (and as much water as wanted). This was sparked by something that occurred to me on a run—‘how much of the food we eat do we actually need or do we just believe we need it’. The surprising thing for me was that, even still running 15 miles a week, I did not feel hungry and actually felt quite energetic. It is hard seeing so much very appealing food around and ignoring it but my body seems to have coped well on what seem very meagre rations. Importantly here though, in preparation, I did strongly empower my beliefs with the notion that this limited amount of food was adequate which I think is an important part of why it felt OK. I guess the point here is that I wanted to reinforce, in myself, my belief that there is absolutely plenty of food and water to feed the whole planet. It just feels that it is distributed in an inefficient manner. Clearly yours and my little experience prove that we in wealthy countries probably consume, in general terms, far more food than we need … the challenge though is how to best share the food around the whole world population”.

This seems to be the nub of the question we are debating today, and it is one that our generation cannot afford to duck.

My Lords, I, too, very much welcome the fact that the noble Baroness, Lady Miller, has tabled this item for debate today. I appreciate her commitment to the cause.

I declare an interest. I farm in the north-east of England and chair the Centre of Excellence for UK Farming, which seeks to bring together scientific research knowledge and to find better ways of applying that knowledge in practice. I am a trustee of the Lawes Trust, which owns Rothampsted Research, which, as the noble Lord, Lord Taverne, has mentioned, is the subject of demonstration this weekend.

The importance of this subject cannot be underestimated, as has been said by a number of speakers today. The global challenges are well understood. Some of us had the privilege of hearing Sir John Beddington last evening at a seminar ably chaired by the noble Earl, Lord Selborne. I shall not repeat the analysis of the challenges we face of climate change, population growth, changing lifestyles, urbanisation and so on. It has been well rehearsed this afternoon. We in Britain are part of this global challenge—we are likely to have 70 million people here—and have a role in supporting the global population, as we have heard. We need to find solutions and demonstrate leadership.

Picking up on the issue raised by the noble Baroness, Lady Sharp, our investment in science, technology, innovation and skills is critical. I know that my good friend, the noble Lord, Lord Taylor of Holbeach, is personally very committed to this agenda; he and I discuss it regularly. I also applaud the Government’s decision to maintain the current level of spend on scientific research against a background of significant cuts in public expenditure elsewhere. However, I seriously question whether the current level of spend is enough, in view of the scale of the challenges we face. The previous Administration slashed expenditure on research and development, as did the Administration before that, believing that we had barns full of surplus food across Europe throughout the 1980s and 1990s and we could afford to cut back.

Unlike most other areas of public expenditure, budgetary cuts in public expenditure on R&D in agricultural and food research have been taking place over 20 years. As a consequence, we have seriously reduced our capacity, institutions have closed, departments have shut down, and a contraction in capacity is a real concern in terms of both facilities and scientific knowledge in certain disciplines. The noble Baroness, Lady Miller, mentioned soil as an example.

I will give noble Lords another example. During this time, spend on horticultural research has fallen by about 40%, with the two remaining institutions struggling to survive. Production of fruit and vegetables overall has continued to decline—at a time when we are being encouraged to eat five portions a day. We are currently consuming fewer than three, so we need a 40% increase to achieve a healthy diet. Where would that come from if we could achieve that increase in consumption?

We all accept that economic growth has to be the current priority for the Government, but we need to encourage the production of local and regional food and recognise that economic growth in the countryside can contribute to the national economy and help drive us out of recession. Investing in science will help sustain economic growth, drive exports and ensure that we have the capacity to feed a growing global population. The noble Baroness, Lady Miller, also referred to the current CAP reform proposals. As currently designed, these seem to suggest that Europe can adopt policies that completely ignore these global pressures. That is not acceptable.

We need sustainable solutions that help us to increase food production, reduce greenhouse gas emissions and our dependence on chemical inputs, and protect and enhance our ecosystems and habitats, all in the face of a reduction in available land and water and increased weather volatility as a result of climate change. We cannot achieve that with our current resources and a fragmented approach to the challenge.

I will quote two responses to the Foresight report, The Future of Food and Farming. The report says that Defra will:

“Champion a more integrated approach by governments and international institutions to global food security that makes the links with climate change, poverty, biodiversity, energy and other policies”.

It says that DfID will:

“Develop a joined up approach to addressing nutrition which includes health and agriculture inputs and which is based on strengthened evidence”.

These are really important responses. Addressing climate change, increasing food production and encouraging healthier lifestyles and diets are all long-term challenges and involve at least six government departments.

The noble Lord, Lord Knight, and I had discussions yesterday with organisations that are trying to give schoolchildren a better understanding of the countryside, food, farming and environmental issues, and the Department for Education has a key responsibility in encouraging a change in behaviour through better informed classrooms. We certainly need joined-up and integrated policies to address these key strategic issues. I am really concerned about how the Government are going to deliver the accepted recommendations of the report and I support the need for a more strategic approach to these challenges.

My Lords, I should begin by declaring my interest as a rather faded and ancient peasant farmer producing wine and a few other things in Provence, although with nothing like the elegance of my noble friend Lady Miller, who has introduced this great debate.

One thing about being tinged with ancienty is that you learn that in order to determine the future it is not a bad idea to look back to the past. Perhaps we need not go as far back as my noble friend Lord Caithness, to the ice age, but in my case it is fairly simple. It is an accident of birth than entitles me to be a peasant farmer and I am proud of it. Our first wine was shipped to what is now the United Kingdom in the second century BC, to Hengistbury Head, near Christchurch, and presumably it went up maybe to Stonehenge. Your Lordships will perhaps remember that Bordeaux was also developed from Provence. We ran the whole of Bordeaux for many years and managed to take control of Eleanor of Provence, Eleanor of Aquitaine and Eleanor of Castile.

When I joined your Lordships’ House, I listened to debates, sitting on my own. I have made the point before that I did not know that when the Government changed you changed from one side of the House to the other, as nobody told me at the young age of 25. My Chief Whip then suggested that it might be a good idea to make a maiden speech. I have to say that I did not know what the word maiden meant. When I asked what I should speak on, he said I should speak from my own experience. My own experience was relatively limited, due in particular to a shortage of food during the war, where, at my prep school, we had only Pom, Spam and powdered egg. I had been brought up in Canada during the war and when I came back I was practically starving.

I learnt, too, that there is a strange thing about the United Kingdom, with a family who were the first people to ship meat from Australia and exploited sugar in the Caribbean. We are not self-sufficient. For the record, I will give the House the Government’s food situation in the year of my birth, 1937. We had to import 93% of our maize, 86% of our barley, 64% of our wheat, 73% of our meat and 95% of our cheese—after the recession, there was a need to produce less milk and more wheat—96% of our tea, naturally, 90% of our cocoa, 79% of our coffee, 79% of our rice and 68% of our sugar, as well as 67% of our butter, 90% of our spices and of course more than 80% of our fertiliser. Much of the latter was guano from Latin America, where William Gibbs “made his dibs on the turds of birds”, as I think it was explained originally.

At my prep school, I got into trouble when I said I had eaten a banana, because no one had seen a banana. I think, and will put on the record in Hansard, that there was a shortage of food. As my noble friend was explaining just now, there is enough food capability and production in the world. If we look back at our own history and the Council of Trade, the reason why we went out into the outside world was because we needed food. We went out to grow and produce all over Africa. The whole of the Commonwealth began initially not so much with the mineral resources but with the potential to create added value on the land.

Why did we get rid of the crown agents of the Commonwealth Development Finance Corporation and why do we not look back to what these countries actually produced? In the days when I did some economic research into agriculture, it was usually to predict what was going to happen to food and I always got it wrong. I came to travel through India and Africa and then gang up with the French in Francophone territories, compete with them, and ask where, what and how we produced. Naturally, sugar was one of those things. Sugar came from the Caribbean. I remember being down in Cameroon with my noble friend Lord Jellicoe when he became Leader of the House and a director of Tate & Lyle, sitting with the president there, who said, “Please, please help us to grow sugar with the Garoua sugar project”. However, Tate & Lyle got a bit nervous about Africa because it was a dangerous place to go to. They had forgotten that it was where we had done extremely well. They had forgotten, too, that Cameroon had named its capital after Victoria because the first slaves had sailed back from Jamaica and were so proud of what we had done to get rid of the slave trade that there was that relationship.

I turn to what I suggest we should do. We should go to these countries where we were before, place orders for what they used to produce and could produce, and give them an off-take agreement. With that agreement, they could fund almost anything. One of my favourite areas, which I have raised before, is the Sudan, which was to have been the bread basket of the Arab world. The Arab Fund for Economic and Social Development under Saeb Jaroudi provided, for people like me, a major grant to look at the possibility of growing grain and exporting it, as we had done before in other parts of Sudan with cotton. If we look at our shortage and what we need to import, and can somehow find a way with the private sector to direct that demand into placing orders where we, using the latest techniques and avoiding the problems of pollution, can help to grow, to deliver to the ports and to have the off-take, we are in good business.

Not so long ago, I suddenly found that I met some gang from Chicago who were very interested in all of this. Some wanted to speculate on the grain market and others on production. A lot of help on this, surprisingly enough, came from Israel. They then suggested to me that it might be possible to produce pork bellies. Thinking of some of the prejudice of the Arab world to the pig—but the pig is a forager and the Romans walked around with it—I was quite intrigued. They wanted to know when grain could be produced because there was a forward market. What I am saying is that if we can use our knowledge, our technology and our historic relationships to revisit these countries and to sit down and help them to grow what we would willingly buy, we could make a major contribution.

My Lords, I too thank the noble Baroness, Lady Miller, for instigating this debate and congratulate her on her timing. There can have been no more topical time to discuss this, given the establishment of the New Alliance for Food Security and Nutrition by the G8 last weekend and given that we are in the build-up to the Rio+20 conference. There can be few more profound issues for this or any other Parliament to grapple with, and this debate has demonstrated the merits of having a House of expertise and experience to address such a complex issue. As we have heard, there is an interplay of issues such as food production, food distribution, sustaining biodiversity and ecosystem services, population change, energy supply, water supply and, of course, climate change, so authoritatively discussed by my noble friend Lord Giddens and by the noble Lord, Lord Stern, who asked a key question of the Minister on the Government’s failure to meet the 2009 G8 commitments—a point reinforced by my noble friend Lord Judd.

As has been clear, the debate is against the backdrop of the Foresight report by the Government’s Chief Scientific Adviser, Professor Sir John Beddington, which was commissioned by the then Secretary of State, Hilary Benn MP. It is worth reading out the opening words from the preface to Sir John’s report:

“The case for urgent action in the global food system is now compelling. We are at a unique moment in history as diverse factors converge to affect the demand, production and distribution of food over the next 20 to 40 years. The needs of a growing world population will need to be satisfied as critical resources such as water, energy and land become increasingly scarce. The food system must become sustainable, whilst adapting to climate change and substantially contributing to climate change mitigation. There is also a need to redouble efforts to address hunger, which continues to affect so many. Deciding how to balance the competing pressures and demands on the global food system is a major task facing policy makers”.

There is no better summary of the challenge we have been seeking to address in this two-and-a-half-hour debate.

To demonstrate the scale of the challenge, it is also worth reminding the House of some of the statistics: a world population of 7 billion, rising to 9 billion by 2050, with currently around 1 billion going hungry every day; demand for water will increase by 30% by 2030; the amount of arable land per head has almost halved since 1960; agriculture accounts for up to 30% of worldwide greenhouse gas emissions. Consumers in rich countries waste, as we have heard, as much as a quarter of the food that they buy and, in more than half of industrialised countries, 50% or more of the population is overweight—I declare an interest. Some 40% of the US corn crop ends up in gas tanks instead of in stomachs.

The noble Baroness, Lady Sharp, reminded us of the fragility of political norms if we ignore this potential perfect storm. This is a crucial subject for ongoing debate in your Lordships’ House. I ask the Minister to use his influence on business managers to see if they would consider an annual debate with more time, as requested by the noble Earl, Lord Caithness, on this most fundamental of subjects. It is not possible to do complete justice to this in the remaining time that I have available, so I will focus on just three or four points.

The first is the great 21st-century food challenge: how to produce more food sustainably. The issue was addressed well by the noble Earl, Lord Selborne. As my honourable friend the shadow Secretary of State for Defra, Mary Creagh MP, said at the Oxford Farming conference this year:

“We cannot have food security without sustainability. It’s not either produce more or produce sustainably. It’s both”.

In government, my right honourable friend Hilary Benn published Food 2030 to set the then Government’s vision for food policy over the following 20 years. I do not know if the Minister has read it. I hope so, but I also ask him if the Government endorse it and if not could they not produce their own vision to attempt to draw some of these themes together for us to debate? We hear about sustainable intensification, but we need some flesh on the bones of the soundbite.

The Government need to give certainty to farmers and businesses wanting to invest in renewable energy such as solar and anaerobic digestion. Like the noble Baroness, Lady Parminter, I would like more action on the separation of food waste by catering outlets and others. We need a comprehensive approach to carbon reduction across agriculture and food manufacturing. The food that is produced needs to be affordable. We need to harness the power of research and development to ensure that food remains widely available and that publicly funded research is publicly available to all who need it. I agree very much with what the noble Baroness, Lady Miller, said on GM, and say to the noble Lords, Lord Taverne and Lord Curry, that Labour supports the publicly funded GM trials being undertaken at the Rothamsted Research Institute. I hope that those trials are properly protected from damage, especially this weekend.

This brings me to my second point about tackling food poverty. We are, sadly, familiar with the images of people struggling to avoid starvation in Somalia, Kenya, or the Sahel region of Africa. We know the global pressures that we face in competing for food and water supplies. In the recent past, no one in this country has worried too much about food prices or food security. Now, I am afraid, we also need to be alive to the challenge of food poverty here at home. Last year food prices in the UK rose by 6%, more than in any other EU country except Hungary.

When Ed Miliband first used the phrase “the squeezed middle” to describe families feeling the effect of rising food prices, energy bills, pay freezes and job losses there was scorn from our friends in the media. I am happy to see that that phrase has now entered the English language. The consumer prices index estimates that we spend 12% of our income on food, but jobseeker’s allowance for a single adult is currently £71 a week. If the noble Earl, Lord Caithness, is right that poor people spend an average 15% on food, that is £10.65 a week. The noble Baroness, Lady Jenkin, talked about living on £1 a day and I pay tribute to her fundraising and what she has done in organising that with noble Lords, but I challenge the rest of us to spend £7 or £10.65 a week on food and to eat healthily and well. I do not think that it is possible. This is why we are seeing the rise of the food banks and FareShare schemes mentioned by the right reverend Prelate the Bishop of St Edmundsbury and Ipswich.

The third point I will make is to ask the Minister the Jamie Oliver question. If we are serious about changing cultures so that we eat more healthily and more sustainably, surely we need to start in schools. Why are we letting academies off the hook on the school nutritional standards? Bringing them in was one of the most important things I was able to do in government, and it is scandalous to see them being eroded away as all secondary school become academies. Turkey Twizzler 2 is just around the corner.

Finally, I want to talk about the threats from commodity speculation facing the global food supply chain. We need a fair market for food. That starts with international action to tackle the commoditisation of food. Increased volatility in commodity prices makes it difficult for UK farm businesses to plan. World commodity prices have risen steadily over the past decade, and some economists and hedge fund managers are now concerned about the impact this could have on the global cost of food and other commodities. Ten years ago, less than $300 million of non-commercial money was invested in commodity markets. In one decade, that has risen 1,000 times, to over $300 billion of financial investment today, more than the entire value of the market 10 years ago.

There is a vicious circle where commercial producers and purchasers pay more to hedge and need to hedge more as financial speculation has increased market volatility. The problem is not so much commercial hedgers—the food producers—but excess speculation caused by Wall Street selling its latest financial products that in turn raises food prices. The UK Government have recognised the impact of world commodity prices, exchange rates and oil prices on food prices, but they failed to support French moves for greater transparency during the French presidency of the G20, so the US has had to act unilaterally.

The answer to many of these multilayered global problems is global co-operation and global leadership. This was one of the points made by the right reverend Prelate the Bishop of Derby. While, as the noble Lord, Lord Gardiner, reminded us, this is not just down to Governments, they have a key role. So my final question is: will the Prime Minister find time between “Fruit Ninja” and football photo opportunities to show the kind of leadership we saw when the previous Government made Africa and climate change their priorities for their presidency of the G8, and that Gordon Brown showed in April 2008 to form the G20 to mitigate the worst of the global financial collapse? That is the sort of leadership we now need to deal with this issue. I hope we will keep returning to this subject, and I look forward to what the Minister has to say.

My Lords, I thank my noble friend Lady Miller of Chilthorne Domer for tabling this debate. I also thank noble Lords for making such valuable and insightful contributions. I am delighted to respond on this important issue. I agree with the noble Lord, Lord Knight, that it is a subject to which this House should return on a regular basis.

Food security is one of the most pressing issues our global population faces, and I assure noble Lords that it is given the utmost importance by this Government. This debate has been called at an important time. As my noble friend said in introducing the debate, the Foresight report, The Future of Food and Farming, published its one-year review yesterday and just last week, as several noble Lords mentioned, the Environmental Audit Committee published its report, Sustainable Food. My noble friend Lord Caithness and other noble Lords pointed to the excellent reports by European Union Sub-Committee D. Many of the conclusions of these reports overlap with issues raised here today on food security.

We are preparing for the Rio+20 summit in June, where the world will debate how to sustain our planet. As my noble friend Lord Selborne and other noble Lords pointed out, this debate has global scope as this is a global topic. The right reverend Prelate the Bishop of Derby and my noble friend Lord Gardiner reminded us of the moral imperatives that are not only presented to us in addressing this issue on a broad scale but locally, where food security is a matter of life and death. The noble Lord, Lord Judd, spoke graphically of the situation in Africa, and it was valuable to hear from my noble friend Lady Sharp about the situation in Egypt. Food security is an issue for those involved in the G20 and G8 summits. The UK will take on the presidency of the G8 in 2013 and will ensure that this topic is at the top of the pile.

We have had a number of references to the recent prominence of this issue in your Lordships’ House. Perhaps it was the price hike of 2008, but I trace it back to the speech, which has been referred to, of Sir John Beddington at Chatham House, in which he drew the world’s attention to his “perfect storm”. We know that the global population, currently 7 billion and rising to 9 billion by 2050—indeed, rising by 1 billion in the next 13 years—will impose increasing demand for water, land and energy. This, combined with a changing climate, means that food security is one of the world’s greatest challenges.

The noble Lord, Lord Giddens—indeed, many noble Lords—referred to the excellence of the Foresight report. That report on the future of food and farming concluded that Governments across the world must take action now to ensure that a rising global population can be fed. The challenges set out in the Foresight report are of great relevance. This Government will build on the work set out in the one-year review, published yesterday, some of which I can touch on here.

I will respond to a number of questions which my noble friend Lady Miller posed, which I can perhaps then use to address other matters which noble Lords have raised during the course of the debate. My noble friend asked especially about Defra’s assessment of intensive dairy proposals. I assure her that the department is undertaking scientific research to better understand the welfare and other issues associated with the development of so-called “super dairies”. We will continue to consider any evidence that comes to light, which may determine whether action becomes appropriate. However, sustainable intensification is about much more than this. It is about producing more from less. It does not necessarily mean just increasing size of production units. It may be done at any scale.

My noble friend Lady Parminter joined my noble friend Lady Miller in talking about carbon footprinting. Indeed, the noble Lord, Lord Stern, with his direct experience of the effect of carbon in the atmosphere, also mentioned this. I have seen for myself at the Scottish Agricultural College, adjacent to the Roslin Institute, the work that is being done to monitor the effect of diet and genetic lines on carbon emissions from cows and cattle. We are working to encourage businesses to understand and to include carbon impacts in making their business decisions.

Of particular concern to my noble friend Lady Miller was the question of soils. I agree with her that soil lies at the heart of a successful crop production system. We are looking at the forthcoming EU soils framework. We support the idea of protecting Europe’s soils, and agree that there is a need to deal with serious soil degradation in some parts of Europe. However, we have concerns about the current proposals. We are concerned that they might impose additional burdens on government, land managers and businesses at a time when the UK and other countries are actually going in the reverse direction and trying to find lighter regulations. However, I assure my noble friend that I have been to Cranfield and seen the work that they are doing there on soils, which is extremely useful and available for farmers so that they can better understand the conditions of their own farm.

My noble friend Lady Miller also asked about co-operation. I agree that, in many ways, some of the weaknesses that farmers have faced have come about because of the difficulty of marketing their products in an increasingly competitive world. We recognise the value that agricultural co-operatives can bring both in this country and elsewhere in the world. In the autumn, we will consult on the implementation of European legislation in the dairy sector, which will increase the scale on which dairy producers can collaborate and allow them to negotiate as producer organisations on the price of milk. I hope that I have covered most of those questions.

My noble friend asked about bees. I was in a meeting today at which this topic came up. I can assure noble Lords that bees are recognised as being an important element of pollination by insects. On the question of pollinators, Defra has contributed £2.5 million to the Insect Pollinators Initiative and £10 million will be available over five years to look at the decline in all pollinators. Defra and the WAG are implementing the 10-year healthy bees plan, which was launched in 2009 and provides practical support for beekeepers. I hope that helps my noble friend with some of the specific questions that she asked. I am grateful to her for giving me advance notice so that I could give her some prepared answers on the subject.

Several noble Lords talked about the role of international negotiations being at the bottom of solving a global problem on an international scale. In June, the world will meet to plot the path to sustainable development and green economic growth at Rio+20. As we know and as I have already said, the G8 and G20 presidencies have identified food security as a priority issue. I assure the noble Lord, Lord Stern, that the action plan agreed at the meeting of G20 Agriculture Ministers in June signals the success of the UK in pushing for transparency in the global food market. We see the great virtue of getting agreement globally if we are to get leverage and have effect.

We want to maintain the momentum on an international scale. I know that my right honourable friend the Secretary of State for the Environment, Mrs Spelman, has championed the cause of food security, sustainable agriculture, water security and sustainable energy forming the core of the new sustainable development goals. My noble friend will know that the Deputy Prime Minister, who will lead our delegation to Rio, shares a similar enthusiasm. Therefore, I like to think that the Government have in place a position that enables us to drive these issues internationally.

A number of noble Lords have talked about food waste. Tackling waste is crucial to food security. Some £12 billion-worth of food that could have been eaten is thrown away by UK householders every year. The Government are taking action through the Courtauld agreement and providing advice through WRAP’s “Love Food Hate Waste” campaign. Since 2006, annual household food waste has fallen from 8.3 million tonnes to 7.2 million tonnes, but that is still far too much. I think all noble Lords would agree with that.

My noble friend Lady Parminter mentioned the consumer’s role. The noble Lord, Lord Knight, perhaps stretching the point a little far by trying to bring education policy into a food debate, talked about healthy eating in schools. I can assure him that that is still government policy and I am sure it is the policy of all schools.

On food waste, the right reverend Prelate the Bishop of St Edmundsbury and Ipswich gave us the figures and we should be grateful for the way in which he pointed out how this issue accounts for a considerable element of the wasted household budget in every household. My noble friend Lady Jenkin gave us her practical experience and we should be grateful for the way in which she has brought this issue to the fore. She has used this House to raise this matter and our consciousness of it.

I, too, applaud the work being done by Fare Share and FoodCycle, which act in a private capacity. I have tried to encourage a number of people in the food industry to support these projects, which have enormous benefits in their support for communities and families less able to afford food. They also have benefits for reducing food waste, which is a positive scandal.

In addition to the contribution to global food security expressed by my noble friend Lord Gardiner, the UK farming and food sector is very important to the UK economy. It is the largest single business sector in the economy. The whole food chain contributes £87 billion per annum and 3.6 million jobs. As a sector, it contributes to the delivery of the Government’s long-term economic objectives on trade, green jobs, growth and development. This Government are acting across the food chain to stimulate growth, to facilitate international trade and to drive fair competition.

It would be remiss of me if I did not comment on the work done by Jim Pace in his recent tour of China where he has managed to secure a market for British pig meat, which could be extremely valuable and important for the pig production industry in this country. Last week, I received a delegation from Hong Kong. I was handed a letter saying that the delegation was happy that the animal health provisions in this country now permit the importation of British beef to Hong Kong. These are important developments for our industry and for the global reach of British agriculture. A thriving, competitive economy where our products are freely traded on the international market will deliver resilient, stable and affordable supplies to consumers.

My noble friend Lord Selsdon is always an interesting contributor to any debate. He pointed to the decline in self-sufficiency here at home, what we can do about it and what we can do to stimulate the capacity of other countries to produce more. In a way, my noble friend Lady Sharp gave us the answer; namely, to use the knowledge that we have on our farms. The point was reinforced by the noble Lord, Lord Curry of Kirkharle, as regards the importance of the science budget in addressing this issue.

Noble Lords will expect me to mention the Taylor review—although I do so not out of any vanity—which sought to bring this issue to the table. Since being in office, I have been working to make sure that the principles espoused by the Taylor review are effectively delivered. I have been working closely with David Willetts, the Minister with responsibility for science, on this project. Today, he has announced grants from the BBSRC worth £250 million to research institutes. This includes specifically £14.5 million for a genome analysis centre in Norwich.

We are working across the board. The noble Lord, Lord Giddens, asked about nanotechnology. We have set up a joint strategy forum on nanotechnology, which he and I co-chair, and we are seeking to cover a number of other issues.

There is a whole question arising from R&D skills, which of course are extremely important if we are going to be able to deliver these matters. We managed to get through the debate without talking very much about the CAP. But of course when it comes to agricultural policy, making sure that we get a successful outcome from the CAP negotiations will be very important for this country and for this issue.

I conclude by saying that I agree with the noble Lord, Lord Knight, that we should make sure that the usual channels take up this issue so that we have regular debates and we can see the progress that we are making. A lot is going to go on in the next few weeks, specifically on sustainable world development—and at the bottom of that lies food security. My noble friend Lady Sharp exhorted the Government to provide leadership here and overseas. I assure her and indeed all noble Lords that that is precisely my purpose and that of my colleagues at Defra.

I join all other noble Lords in thanking my noble friend Lady Miller for giving me the opportunity to say just that.

I warmly thank all noble Lords who have spoken and the Minister for his very detailed and thoughtful reply. In doing so, I congratulate him on securing that £250 million for the science budget. It cannot have been easy, and the interview today on “Farming Today” with the director of the BBSRC was a good one, because it showed how the budget would be distributed very generally. We will be glad to see that, and to know that it will not be over-focused on one thing.

I am grateful to noble Lords for focusing on the issue of waste. As so many contributors said, it is ridiculous that we are worrying about feeding more people when we have almost enough food in the world to feed the 9 billion that will be. It is just that we waste it by throwing it away here or it failing in storage in the developing world.

This was an incredibly useful debate. I would very much agree with the noble Lord, Lord Knight of Weymouth, about commodity speculation. That probably merits a whole other debate in itself. I hope that we can look forward to a more regular debate on food security and think that this afternoon will have proved the worth of having one.

Motion agreed.

Small and Micro-Business Borrowing

Question for Short Debate

Tabled by

To ask Her Majesty’s Government what steps they are taking to facilitate alternatives to high street banks for small and micro-business borrowing.

I very much thank the House for giving me the opportunity to bring forward a debate on small business and credit and the failure of high street banks to offer that credit and therefore the alternatives that we must look at. I warn the House beforehand that I am going to focus in the time that I have on two areas of particular interest to me, so I thank the other noble Lords who are going to participate in this debate in advance, because they will expand the conversation way beyond the range which I am capable of introducing.

There is very little dispute today that small and micro-businesses especially are struggling to access credit from the five high street banks that dominate banking in the UK, and that has been going on since the crash of 2008—and there were underlying problems before them. The Breedon report was very good; it quoted recent data that showed that 33% of SMEs applying for a loan were rejected and that the decrease in the supply of loans to SMEs in the UK has been much sharper than in other countries. We have a piece today in the FT that says that small businesses lament the shrinking pool of credit. If we needed a real illustration, the entry of Wonga into this field with potentially 2% of interest per week says in every way that there is a very serious vacuum. The truth is that the view of high street banks in this country is that “bankable” credit is a very narrow term indeed. Most lending for SMEs over past years has effectively been a form of real estate; it has not been an assessment of the business plan. It is not just that the high street banks will not do this lending—they cannot. They no longer have local knowledge; they do not have trained credit staff; they are now into a form of centralised tick-box commodity-type lending activity. The contrast is sharp with the German savings banks, the Swiss cantonal banks and the US community development banks, which are a backbone to SMEs in Germany, Switzerland and the United States. In those countries, lending has increased since the crash.

The banks that I just mentioned have a common characteristic: a social obligation as part of their mission, as well as profit—so not just a sole profit-maximisation obligation. Those banks are tied to a specific geography, so they are forced to make a success out of local businesses and to take a long-term view; they cannot diverge into other ways of earning money. Dr Thomas Keidel, who is very senior in the German savings bank association, talked to some in this House, making it clear that that local knowledge gives an intimate assessment of risk in a way that even a regional bank cannot accomplish. He said that many of the best credits in the German system are risks that would have been turned down had it not been for knowing management, understanding the order book and really being sensitive to the local issue. That is crucially different from the savings banks in Spain—they are in great trouble—which do not have that geographic link.

I argue that, frankly, this is a tier of banking that we do not have in the UK. We have some valuable community development financial institutions, credit unions, funds and banks. I have visited many, including a brilliant business enterprise fund in Bradford, but they are small and fragmented, and their geographic coverage is fairly random. I know that the Government will say that there is now an agreement with the British Bankers’ Association that high street banks that turn down a credit will then refer that small business to a local CDFI. However, that is relatively meaningless unless CDFIs are coherent and comprehensive as a sector and have sufficient funding to meet demand. At present, the CDFI sector in this country is swamped. One of the banks calculated that if they were really going to meet need, they needed something like £125 million of potential lending a week, but they are nowhere near that. The irony is that plenty of investors would like to get engaged with the sector, especially social enterprises, charities and philanthropic individuals, as well as commercial players. With the additional growing capacity to raise funds through the new sector of social impact bonds, there is huge potential to support an equivalent to the local and community banking sector.

We have to remove the regulatory barriers to new entrants into the banking system in the UK, which prevents social entrepreneurs and others getting new banks started. The FSA would say that nobody applies, but look at the experience of Metro Bank, the only bank in recent history with a new banking licence. We all know the numbers—something like £25 million to get regulatory approval, in two and a half years. Consultants in the banking arena all say to anybody interested, “Don’t even try. See if you can buy a banking licence, but otherwise forget it in the current climate”.

If I take interventions I will not get through my speech, so I am going to carry on.

I refer anybody questioning the barriers that come through the regulator to a very good piece called Street Cred by Civitas. It is a bit melodramatic, but it underscores all the difficulties that people face. I have talked with people in the US, and they reckon that it takes roughly six months and costs $2 million to get a new bank started. That is a very different situation.

The Government must develop a specialised bank licence and an appropriate set of capital requirements for small local-community banks undertaking the social impact obligation. We need off-the-shelf packages for small bank start-ups to provide economies of scale, including basic regulatory approval, working software and other forms of support. The US does it—it is called “bank-in-the-box”. We need a regime to enable banks that fail to be dealt with quickly as that gives confidence, especially to the regulator, to lower entry barriers. The Banking Act 2009 failed to do that. The FDIC in the States does a far more effective job. We have to introduce such a regime. I do not see signs of it but I hope that it will come. We should also deal with the VocaLink payments system, which is owned by a cartel. There are many regulatory barriers and failures in the system. Their removal could make a fundamental difference to what we do.

I wish to make two suggestions. First, RBS is, frankly, an albatross around the Government’s neck. If RBS’s branch network were used to create a community banking network, we could see a massive and rapid step change in this area. Secondly, we should examine what kind of lending high street banks undertake, see where the gaps are, and whether they are genuine gaps. It seems to me that there is an argument for saying to those banks, “We are not going to make you undertake this lending but we will have you fund someone else who can through capitalising a local community bank”.

In the time I have left I wish to say a few words about the innovative online lending platforms. I am not talking about companies such as Wonga but about the platforms that have investors on the one side and borrowers on the other and offer non-exploitative lending rates. They are new in the field and have grown up in the past two years—for example, companies which offer crowd financing and peer-to-peer financing. I am sure that noble Lords find that term hilarious. This industry has significant potential but is begging for stronger regulation. There is an enormous fear in the industry that a couple of cowboys might come in and create havoc, resulting in terrible headlines, investors fleeing and the regulator intervening in an incredibly heavy-handed way. It is crucial that the Government provide a more constructive regulatory framework which is proportionate and does not stifle the industry’s growth but which engenders confidence in the industry so that it can move forward.

I do not want to pretend that the Government have done nothing in this area. I am sure that the Minister will list what they have done. I acknowledge that things have been done but not on the scale that is necessary to support our SME sector. It is vital that the Government understand the limitations of the high street banks instead of constantly telling them that they should lend to these companies. They will not and cannot do that. The Government must have a coherent plan to fill this vacuum and must enhance the opportunities for local banks and quality online lenders. One of the problems is that there is no one in the structure of government at the moment who leads on this issue. It is split between BIS and the Treasury, and within the Treasury there must be five Ministers covering different parts of it. The Government should identify a champion to try to resolve this problem and take it forward. If they do not, we will not sustain our small businesses which are the backbone of our economy and we will give all the space to our competitors.

I thank the noble Baroness, Lady Kramer, for bringing such an important and timely topic before the House. She made some important suggestions and comments, on which I would like to expand. For many years I worked as a business and corporate finance specialist, financing small and medium-sized businesses and helping them to secure bank finance either to start or to expand their businesses. We used to process their applications within the day, and many of those firms have gone on to be huge employers that contribute to our communities and our country.

The idea of small businesses securing finance in 24 hours is one that will probably amaze younger entrepreneurs. It is unfortunate that securing finance for micro-businesses in today’s market is at best time-consuming and uncertain, and at worst impossible. The business-friendly climate that I encountered in Britain in the 1970s, 1980s and 1990s has unfortunately given way to uncertainty, bureaucracy and great difficulty. Nowadays, many small businesses find that it takes at least a month just to set up a bank account in the first place, let alone to get finance.

While I entirely believe and support the Government’s commitment to rebalancing the economy and boosting the private sector, the climate for small and micro-businesses, particularly in regard to funding, will have to change considerably before we can make the Government’s vision a reality.

I wish to muse briefly on bank borrowing. The coalition agreement makes it clear that ensuring that credit is available to SMEs is essential for supporting growth, and should be a key priority for the Government. They have announced a number of policies to support this aim, including, of course, Project Merlin, as well as the enterprise finance guarantee scheme. The intentions behind these policies are undoubtedly good, but with Project Merlin the often optimistic statistics regarding bank lending do not seem to match the experiences being felt by small businesses.

I hear every day from friends and associates in the business world that lending from banks is very difficult. With the uncertainty generated by what is happening across the eurozone, I do not anticipate that this situation will change for a considerable time. In addition, many of the schemes offered by the Government—in particular, the business department—often experience very low levels of participation. Perhaps worse, many of these schemes are unknown to many of the small businesses that could most benefit from them. As a brief aside, I wonder whether the communications strategy at BIS could be better targeted so that these schemes are heard about beyond Westminster.

We must look beyond these measures and, as this Question urges, at the alternatives. The financial avenues available to small businesses are still plentiful but require some creative thinking and a culture change. One of the difficulties we are experiencing is that FTSE 100 companies are currently holding approximately £130 billion in their bank accounts. At the same time, many small businesses and entrepreneurs are sitting at home with a fantastic idea or product, but cannot make them commercially available without significant investment. There must be a way further to encourage our largest businesses to invest in and support these micro-businesses to make their products financially viable.

We could also encourage the establishment of alternative providers of capital. In the 1970s, a large number of finance companies were licensed under the Consumer Credit Act and provided business finance to small and micro-businesses. Companies such as Forward Trust, Lombard North Central and First National Securities provided an invaluable service, particularly to leasehold corner-shop owners, as I was at the time. When I first went into business in 1977, I lent from Forward Trust, and while it was expensive it was a specialist company that was willing to take risks. Unfortunately these firms were victims of their own success, and were taken over by the banks. There is, in my opinion, a clear gap in the market for firms of this nature if we can encourage them back. In addition, I meet many high net-worth individuals who are keen to invest in small new ventures but are concerned about doing so. I would like to see the Government explore ways in which wealthy individuals can be encouraged to support start-up businesses in which they are not directly involved.

A related point is that we should encourage smaller businesses to explore new equity financing arrangements. This can help to bring in the capital needed to allow companies to grow and, if coupled with expertise or guidance, may well increase the chances of a small business succeeding, particularly if it is in the early stages.

In the UK, we are fortunate to have significant venture capital funding options for businesses. However, these are often restricted to specific geographical areas, certain specialised industries or businesses of a certain size. I should be interested to know whether the Government have any plans or incentives to help to expand the venture capital industry so that many SMEs that currently miss out can benefit from this very useful industry.

It is worth taking a moment to consider two other points. This Question is clear about looking for alternatives to high-street banks. It is my personal view that, if we were to reduce the barriers to entry for the banking industry and encourage competition, our SMEs would benefit most. By encouraging new banks—particularly local, regional and community banks—new sources of capital will become available to SMEs. In addition, by granting full banking licences to other international banks, such as those from India and China which do not currently do large amounts of business in the UK, or by supporting the creation of new banks, small businesses across the country will feel the benefits and have access to new sources of credit.

My final point is that, while I fully support the need to find new sources of capital for micro-businesses and SMEs, we should not decouple this from ways in which we can reduce the costs that these businesses incur. I know that this week’s publication of the Beecroft report has created some debate about the best way forward, but the Government have a duty to do all they can to reduce the considerable regulatory and fiscal burden on small businesses.

We need a radical new approach to small businesses generally, not just to how they find alternative sources of finance. I would appreciate my noble friend’s comments, especially on the areas that I have suggested: the speed at which we can raise finance; the need for BIS’s communication strategy for small businesses to be well targeted; whether we can make effective use of the £130 billion of deposits held by the FTSE 100 companies to help small businesses; whether we can do something about high net-worth individuals; and whether we can do more about our venture capital funding. As the noble Baroness, Lady Kramer, said, there are many barriers to starting a new bank. How about issuing a full banking licence to some of the foreign banks that have cash liquidity?

My Lords, I, too, congratulate the noble Baroness, Lady Kramer, on securing this debate. It is a pleasure to follow the noble Lord, Lord Popat, who brings a great deal of relevant business experience to our debate. I also look forward to hearing the reply from the Minister, the noble Lord, Lord De Mauley, who also has a very impressive career record in banking and financial services. Although the number of speakers in the debate may be small, with the single exception of me the quality of contribution will no doubt be exceedingly high.

It may be helpful to set some context for this issue. First, lending by UK banks to corporate borrowers, excluding financial institutions and real estate, represents less than 5% of the assets of the UK banking sector. Secondly, small businesses, and in particular the smallest of small businesses, tend on average to be net lenders to banks rather than net borrowers: that is, they run working capital cash surpluses and do not rely on debt from any source to support their business. They do of course rely on the banks for services, particularly for payment processing.

Chart B on page 7 of the Bank of England’s Trends in Lending, published in April 2012, shows that net lending to SMEs continues to contract at a rate of about 5% per annum. In fact, this has been the case since 2009 and it is not limited to the UK alone; it is a global phenomenon. It is observable in the United States and in the euro countries that lending to small companies is contracting.

Despite the fact that lending is contracting, terms are widening. An economist might say that that suggests prima facie evidence that if banks can charge more in a market of contracting demand, there must be inadequate supply so that the banks can charge more generous—some would say penal—terms. I am not at all persuaded of that. As a Treasury Minister I wrestled with the issue of whether declining commercial lending was a function of banks not lending or of borrowers not wanting to borrow. I certainly did not find a convincing answer to that question and I do not think that the current Government have either. I suspect that we will never be able to find the answer. I remind noble Lords that this is not a distinctly UK phenomenon. It appears to be happening elsewhere in the world.

I think that the widening of terms is a consequence of effective competition among market leaders. The noble Baroness, Lady Kramer, referred to the dominance of our five major lenders. Indeed, the report of the Independent Commission on Banking highlighted on page 167 that the concentration and absence of effective competition was at its most acute in the SME sector. Personally, I think that the Royal Bank of Scotland should never have been allowed to acquire NatWest. I declare an interest. I was a director of NatWest at that time and have no doubt that it needed remedial treatment, but the economic consequences of the concentration in SME lending was damaging to the economy.

We must, of course, await the White Paper, due to be published on 14 June, detailing the bank’s proposals on ring-fencing. I sincerely hope that the Government will show real determination to implement the recommendations of the Vickers report, and in particular take urgent action to reduce the extent to which the taxpayer continues to be at significant risk of failure as a consequence of the investment banking operations of a number of UK banks—not, I hasten to add, limited to those that are owned by the taxpayer in a significant part.

The noble Lord, Lord Popat, referred to Project Merlin. It did not deliver the gross lending target that was set for it, but it was not the right target. Again, I wrestled with this in government. Mr Vince Cable was very clear. In an interview in the Daily Mail before Merlin, he said that the introduction of a gross lending target as opposed to a net lending target would,

“be completely letting the banks off the hook. It’s perfectly possible for banks to achieve a gross lending target while withdrawing capital from small to medium-sized businesses”.

I think that the right honourable Vince Cable was correct and that the Treasury’s approach to defining the objectives of Project Merlin were right. Indeed, it is to the Government’s credit that they did not renew Project Merlin because the banks were quite frankly running circles around them in achieving those gross lending objectives.

We shall see how the new programme of credit easing operates. It does not involve direct lending to small businesses; it involves reducing the funding costs paid by the banks. We have heard very little about credit easing and have seen very few cases of small businesses claiming that they have been rescued or significantly supported by credit easing. I am very sceptical about whether it will work in practice. I hear that one of the major banks is offering cashbacks to SMEs through credit easing—in other words, not reducing the level of debt at all. The Government need to look very carefully at whether that initiative will work.

The noble Baroness, Lady Kramer, referred to the case for new banks, and I think that the noble Lord, Lord Popat, did as well. We have seen two banks sold recently—at least one, Northern Rock, was sold; and Lloyds Banking Group is still trying to sell the business under the code name Project Verde, which has to be disposed of under the state-aid remediations. It was interesting that these banks sold not at book value but well below it. That is quite telling when we consider the attractiveness of being involved in banking. Mr Stephen Hester, the chief executive of the Royal Bank of Scotland, said in a recent interview that many people thought that one had to be dumb to invest in banking at the moment. I suspect that those who hope for the creation of new banks will find themselves waiting a long time. At the moment, if you put £1 of capital into a new bank, its de facto value will rapidly fall to 70p or 80p because—I do not wish to be too technical—the ROE generated with an appropriate leverage ratio is simply not capable of matching the cost of capital. In other words, the banks are not producing a return that is consistent with the risk, as the equity provider would expect.

We heard comments about alternatives such as pay-day and peer-to-peer lending. We need to keep them in perspective; they are very marginal and will not have a transformational impact on the UK economy. They might be of some benefit to individual borrowers but they are not the solution to the problem of generating economic recovery. Similarly, the proposals from Mr Tim Breedon—worthy, well argued and thoughtful as they are—must again be seen as marginal, at least in the short term. Reducing the dependence on banks as a source of credit and encouraging bond markets, as one sees for instance in America, is a good and laudable objective, but it will not help us out of the current mire of the double-dip recession. For that, we need to see fundamental economic adjustments.

The core issue is not that our banks are not willing to lend, or that they are constrained by capital, but that people do not want to borrow any more than they need in a climate where the business and economic outlook is highly uncertain. The absence of confidence, to which the Government’s economic policies have been a contributory factor, is leading to a lack of appetite for borrowing, investing and growing businesses. While we may look for fault on the banking and credit availability side, the real issue is whether we can articulate coherent and credible strategies that will get the economy moving again. To date, the Government have not shown evidence that they can do that. They and the Bank of England seem to be following policies of financial repression. However, I am hopeful that circumstances are changing and that there will be a greater appetite on the part of the Government for taking positive measures to stimulate and promote economic growth without going back to aggressive deficit-growth strategies.

My Lords, I, too, thank my noble friend Lady Kramer for securing this very timely debate. It is humbling to follow such a great expert as the noble Lord, Lord Myners. I cannot begin to compete with him but I, too, will attempt to put the issue in context.

It looks likely that some of the institutional giants in the world of banking may go the way of the dinosaurs. Nothing lasts for ever, and they resemble nothing so much as the cruise liner “Costa Concordia”, wallowing in the shallows of the Mediterranean and waiting to hit the rocks. Mindful of that, we must read the runes and suggest alternatives. It is a banal truism to say that financial services are vital to the health of the nation’s economy—and equally vital, as my noble friend suggested, to the prosperity of both community and region.

Project Merlin, which was referred to, was meant to increase the flow of bank loans to businesses, particularly small and medium-sized enterprises. Although the banks agreed to this, in practice little was achieved; there was no magic. Project Merlin would have been named more aptly, Project Tommy Cooper. The failure was symptomatic of how the banks are not serving the needs of the economy. We need to raise our sights and contemplate alternatives.

As the noble Lords, Lord Myners and Lord Popat, said, much of the western world, including the UK, are in for a protracted period of zero growth at best, or negative growth at worst. The UK will experience a society and economy similar—although, I hope, not with the same magnitudes—to that of the 19th century. The Victorian age, Dickensian and ghastly though it was for so many, nevertheless inspired the creation of a whole range of remedial initiatives. These included the rise of the co-operative movement, the formation of building societies, credit unions, mechanics institutes and the like. Self-help and mutuality constituted the operating principles of the time, with the main emphasis being on the local and communal. As my noble friend Lady Kramer said, the banks in those times were much more focused on serving the local and regional areas and were by no means all centred on London.

Globalisation has, of course, brought many economic benefits but also costs, including the recent disasters within the financial services industry. We need to recreate the local to offset the worst excesses of globalisation. We should learn from our Victorian predecessors. The Victorians, of course, inhabited an era of increasing economic growth, whereas for us it will be the reverse. That makes it all the more important. It would be sheer folly to think that existing arrangements and institutions will be able to adapt themselves. Already commentators are adding to the “too big to fail” character of banks a “too big to manage” dimension. It is interesting that in today’s FT there is a report which states that,

“pressure mounts for the break-up of US banks”.

This is why other options must be explored.

If history may be a guide, so, too, can comparative experience. I refer to the extraordinary example of Mondragon in Spain. Starting in 1956, a range of industrial co-operatives have developed. Central to their growth has been their own bank, to which they subscribe and from which they borrow capital. As co-ops, they are owned and controlled by their employees. They are also restrained in the size of their labour force, and above a defined limit the individual co-op has to split up and divide into two. There are now over 250 constituent co-ops in the Mondragon federation, employing nearly 84,000 people. It is the seventh largest enterprise in Spain.

Co-ownership, of course, has long been a much cherished Liberal Party and Liberal Democrat party policy. The late Lady Seear was an ardent advocate of co-ownership on these Benches. In the mid-19th century there was a good deal of cross-party support for wider share ownership. Now there has been a revival of interest, with talk of enterprises being created on the lines of the John Lewis Partnership model. It has been mooted, for example, for the re-organised Post Office.

The ground is becoming more fertile for the planting of the seeds of a new thinking. Some fruitful new signs have emerged. For example, there is the issuing of local currencies in Lewes, Brixton, Totnes and elsewhere; and the facilitating by Mr Ivan Massow’s “Business Angels”, whose peer-to-peer lending encourages companies with more than adequate cash reserves to make loans to credit-strapped companies. I am sorry that the noble Lord, Lord Myners, thinks this is small beer. I hope it will become catching and grow.

However, much more needs to be done. We need a champion along the lines of the late Lord Young of Dartington. Michael Young pioneered the rise of the consumer movement in the last half of the 20th century that unleashed a social and economic revolution. That is what we need here. Someone with that kind of vision, lateral thinking and organising flair is sorely needed now to address the pressing problems we face, none more so than in the area of the local provision of banking credit. There are, alas, too few Michael Youngs, which is why I suggest a co-operative of intelligent, like-minded pioneers to think up and bring about the radical changes that must be wrought.

We must not drift or sleep-walk into the future. As a response to the continuing crisis, mass protest, though wholly understandable, is not the answer. That answer will come only from radical and new ideas. The focus must be on the small scale and communal. If the Prime Minister’s advocacy of the big society is to have any chance of becoming a big deal, small and communal enterprises will form its essential components.

I have one question for the Minister: what evidence can he adduce that the necessary thinking and effort is being applied by the coalition to address this issue?

My Lords, I, too, welcome this debate and the success of the noble Baroness, Lady Kramer, in achieving it. It has been a very interesting debate so far and I would like to discuss, if you like, the other end of the telescope: the needs of small businesses that have contracts with large companies.

Due to the way that the large companies have set their terms, these SMEs seem to need more and more finance in order to create enough working capital to keep going. It is very sad that some of these major companies are taking action to make it more difficult for SMEs to continue. They do not seem to realise that if they do not have the SMEs, their own businesses are not going to succeed. I will describe two case studies—one good, one bad—and I certainly am not blaming banks for the situation, I am blaming the companies. It is an issue that needs some action.

First, the good company is Network Rail—it may surprise your Lordships to hear me cite Network Rail as a good company, but actually in the past five years, from being a pretty bad customer, it has turned out to be a very good one. In November, it launched a fair payment charter for its suppliers, which it signed with 30 of the biggest construction and engineering companies. Network Rail says that the charter helps to,

“increase liquidity through the supply chain”,

and there is about £7 billion a year of expenditure at stake. I believe that some 80% of its suppliers are in the SME category, so it is quite important.

The key thing is that Network Rail has taken a decision,

“to shorten the time it takes to pay suppliers from 56 days to 21 days”.

Equally importantly, the fair payment charter also,

“commits Network Rail’s suppliers to make payment to their first-tier subcontractors within seven days of receiving payment. This means that the time from the submission of a main contractor’s application to receipt of payment by the first-tier supplier is now 28 days”,

which really helps to,

“increase the liquidity of the supply chain and provide greater certainty for suppliers in terms of business planning”.

The other thing Network Rail has done is to,

“phase out the practice of retention in contracts—where a portion of payment is withheld until after completion of work”.

This is very common in the civil engineering industry as well. The charter also requires suppliers,

“to mirror the retention regime agreed with Network Rail for the … subcontractors. So, where the main contract retention is zero, this will be replicated down the supply chain”.

This is a major achievement.

In March, Network Rail signed up to British Standard 11000—Collaborative Business Relationship Management Systems—with its five major suppliers through the Institute for Collaborative Working. I declare an interest in that I am on the board of the institute. It really is a major step forward. I talk to a lot of contractors and suppliers of Network Rail and they welcome it. It is not often that suppliers to any big organisation welcome the payment terms, and this is really a positive step forward. Let us hope that it continues—I have every reason to believe that it will—as it will help getting value for money on a £7 billion programme.

Now for the bad case, and it is pretty bad. I refer to National Grid, which is a company that is probably of a similar size to Network Rail. It is a pretty strong company. It made a profit of £644 million in the year to 31 March 2011, and the credit agencies indicate that it can be provided with over £46 million in credit by its creditors. One could reflect in passing why, with this kind of financial result, its regulator, Ofgem, does not require it to cut some of its charges to customers, although that is a slight aside. My question really is: what is the company doing? I would call it screwing its suppliers so that they have to go to banks, which sometimes find it difficult to lend to them.

National Grid pays an average of 24 days beyond the terms in its contract. It also has very tough procurement processes for small suppliers, which it forces to accept these non-standard terms. It has 42 days as a standard for payment of invoices and is actually paying suppliers, on average, 66 days after it receives the invoice for the work done. This hides the fact that over 34% of the suppliers have to wait 91 days to be paid by National Grid. According to Dun & Bradstreet, this company has one of the worst payment records in the UK. Only 7% of all UK businesses have a worse delinquency score, as I would call it. Of every 10,000 National Grid payments, 5,683 are significantly late. At one time last year its payment terms were 60 days over standard, which means that it is taking over 100 days to pay its suppliers. I suggest that the company is using its monopoly position to force suppliers into lending it millions of pounds—which then forces the banks into lending to the smaller suppliers, through what are probably expensive overdraft facilities, to keep them solvent.

Network Rail and National Grid are both regulated monopolies, as the House will know, but Network Rail has this code of practice while National Grid sits on what I believe is a pretty fat profit and thinks that it is reasonable to delay payment to SMEs for over 100 days, thereby putting some of those businesses into financial difficulties. My question to the Minister is: what is Ofgem doing about it? Has it got any teeth, or has National Grid achieved what I call regulatory capture? The Government want to encourage SMEs and investment, as do we all. They also want to encourage growth—as the noble Lord, Lord Taylor of Holbeach, said in winding up the last debate. Will the Minister therefore ask Ofgem to require National Grid and the other companies in this sector to adopt a fair code of practice on the lines that Network Rail has so successfully operated in the rail infrastructure industry?

My Lords, I thank the noble Baroness, Lady Kramer, for providing the opportunity for what might be a micro-debate in terms of numbers but a macro-debate in terms of the issue. I start with what my noble friend Lord Myners referred to as the core issue—if we do not get some growth and confidence back into the economy, we face a situation where potential borrowers and small businesses see borrowing as the very last resort because they do not have confidence in the current financial situation.

I am also glad that we are having a debate on an issue which something like 28% of SMEs said was one of the key issues that they face. I am afraid I did not agree with much of what the noble Lord, Lord Popat, said except when he got on to the Beecroft report. I do not think that that is going to encourage small businesses to take on more employees. Confidence and the ability to borrow if they feel confident are much higher up their agenda. If we had to give a message on how they should treat their employees, it would not be on the ability to fire them without giving them a reason for dismissal. It might be on recognising the need to invest in their employees and have decent HR policies. They might find that they would get a much better return in productivity and retention. That has been my experience over the years.

I must admit that, listening to the noble Baroness, Lady Kramer, I found myself in agreement with much of what she said. She talked about the different developments in the US, Switzerland and Germany and the social obligation and local nature of their banking. That is a view about which the Federation of Small Businesses, if one looks at its report, was asking the Government. I look forward to the noble Lord, Lord De Mauley, commenting on whether the Government intend to pick up on any of the recommendations of that report from the Federation of Small Businesses.

There seems to be some disagreement, as some have suggested, including, I think, the noble Baroness, Lady Kramer, in relation to innovative, online peer-to-peer lending. I do not feel confident about saying who is right. The noble Lord, Lord Smith, referred to that as something that would be of value, although my noble friend Lord Myners did not necessarily agree with that. I must admit that I was fascinated to hear the comments of the noble Lord, Lord Smith, about Mondragon—I do not know whether I have pronounced that right—and the expansion of Co-ops. That was an interesting point.

Whatever Merlin did, it certainly was not a magic bullet. It did not deliver. My noble friend Lord Myners delivered a far more comprehensive analysis of the failure of Merlin. What is the Government’s strategy, given that Merlin has failed and credit easing does not yet seem to have emerged to solve the serious problems that we face? The plain fact of the matter is that the Government are failing to get the banks lending to SMEs and that is one of the contributory factors to holding back growth and job creation. Credit easing has failed to get banks lending to more small businesses. If we were in government, we would have established a British investment bank to support SMEs—an infrastructure that was backed by the British Chambers of Commerce and by Adam Posen from the Bank of England.

In relation to other measures that the Government could take that might assist small firms to take on extra workers, a national insurance tax break might well provide some relief and encourage companies to consider taking on extra workers. In our view, it would reverse the Government’s damaging VAT rise. Interestingly, the Bank of England’s lending report of April 2012 said:

“The stock of lending to businesses decreased by around £9 billion in the three months to February … The net monthly flow of lending in February was at its lowest in almost two years”.

It went on to say:

“Spreads over reference rates on lending to small and medium-sized businesses widened in 2012”.

That is not a good picture at all of the Government’s attempts to get banks to lend to small businesses.

Interestingly, in the Queen’s Speech debate on Monday 14 May in the other place, Vince Cable said:

“Nobody ever argued that the credit easing scheme would solve the problem of small business lending. We argued that it would cheapen the cost, and that will happen. All the major banks are now engaged in arranging packages to enable those lower costs to be passed through”.

He said that we were going to be,

“pleasantly surprised by the take-up within a few months”.—[Official Report, Commons, 14/5/12; col. 289.]

That sounds different from what the Chancellor told us in October in his description of the credit-easing scheme. I would welcome the Minister’s opinion on whether the Government feel that that scheme is having any effect.

In the other place, Labour’s shadow Small Business Minister, Toby Perkins, said that the Bank of England survey showed that many businesses are seeing the cost of finance rise and that small and medium-size businesses are finding it hard to get finance at all. He said that we are looking to the private sector to grow our economy, but 50 businesses are going under every day and too many are struggling to get the finance that they need to grow and take on extra employees. He said that Ministers promised that the credit-easing scheme would help firms unable to get finance, but the report shows that the scheme is failing to make a difference. He went on to say that the Government continue to let down small firms under pressure because of the recession made in Downing Street. Labour is planning a British investment bank to help small businesses get the finance that they need to grow. Our five-point plan for jobs and growth will provide real help, including a one-year national insurance tax break for small firms hiring extra workers.

I was interested in the comments made by my noble friend Lord Berkeley when he gave us the idea of the good guy and the bad guy. This is a serious problem for SMEs. I would be interested to hear what the Minister has to say about what he described as a fair payment charter. It seems a worthwhile proposal for industries which are regulated.

I conclude by coming back to small and medium-size businesses. When I speak to them, they tell me that they see this as an issue of high importance. They do not tell me that the ability to hire and fire is their number one concern. Given that Project Merlin has failed, what positive steps are the Government intending to take? Are they going to pick up recommendations made by the Federation of Small Businesses? I look forward to the Minister’s response.

My Lords, I thank my noble friend Lady Kramer for initiating this debate, and all noble Lords who have participated. This is a vital issue and has been for a long time; it is not a recent phenomenon, although it is even more acute in the current environment.

The Government are committed to rebalancing the economy, encouraging private sector investment and creating the conditions for confidence to return, small companies to thrive and growth to revive. Ensuring that small businesses and micro-businesses can access the finance most appropriate for them is a core priority. While we want to ensure that there are alternatives to high-street banks for businesses, the majority will remain reliant on banks. It is vital that SMEs are able to access bank finance. I will explain what we are doing in that area before dealing with alternatives.

First, the Government provide guarantees to viable SMEs lacking sufficient collateral to secure commercial finance. The enterprise finance guarantee scheme plays an important role in facilitating credit to viable small businesses and micro-businesses. Over 12,800 businesses with a turnover of under £1 million have been offered EFG loans. That equates to 70% of all the loan offers under the scheme. The enterprise finance guarantee is delivered by lenders directly. They include banks, and alternative finance providers such as community development finance institutions.

Secondly, in the Budget the Government launched the national loan guarantee scheme, which reduces the cost of bank lending to smaller businesses by up to 1%. This is achieved by the Government providing guarantees on unsecured borrowing by participating banks to enable them to borrow at a cheaper rate, and therefore to pass on the entire benefit they receive to small businesses through cheaper loans. The Government will provide up to £20 billion of such guarantees. Thousands of businesses have already benefited from LGS loans and the scheme is proving popular. Ulster Bank formally launched the scheme in Northern Ireland last Monday.

Thirdly, to improve relationships between banks and small businesses, we are working with the BBA on the delivery of a range of bank commitments. As a result—and this is very significant—the banks have put in place: first, an independent appeals process to deal with situations where businesses have been declined loans; secondly, an online mentoring portal for SMEs to find sources of advice; and, thirdly, a lending code that makes it clear what standards businesses should expect from their banks.

It is also important that we do what we can to encourage the development of diverse sources of finance for SMEs beyond just the banks, which is the gist of my noble friend’s Question. Increased competition not only between banks but between forms of finance will improve outcomes for businesses. The Business Secretary recently commissioned a report, which has been referred to in this debate, from Tim Breedon that explored alternative finance options such as supply chain finance, mezzanine finance, peer-to-peer lending, retail bonds and so on. All these should be fostered and encouraged, to create a more resilient business finance environment. The Government have a role to play but so do financial institutions and, crucially, businesses themselves.

To diversify the sources of finance available to smaller businesses further, BIS has received £100 million from the business finance partnership. This funding will focus on alternative lending channels which aim to lend specifically to smaller businesses. The key aims of this scheme are to stimulate the development of non-bank lending channels and to increase the supply of capital to smaller businesses. In support of these objectives, we are considering investing business finance partnership money through peer-to-peer lending platforms, mezzanine loans and supply chain finance products.

For businesses seeking other forms of debt finance, community development finance institutions offer an alternative to the banks. They provide microfinance and small loans to enterprises that banks consider too costly or too risky to serve. Such businesses can nevertheless be viable and tend to have a positive impact on their local community. The Government support the CDFI sector in a number of ways. A key aspect of this community investment is tax relief. This encourages investment in CDFIs by providing a tax relief worth up to 25% of the value of the investment over five years. The funds so invested are then on-lent by the CDFIs to small businesses and social enterprises. We are currently looking at ways to simplify the rules to encourage more usage and make it more effective. This is because public investment of this type has been shown to be an effective method of generating and protecting economic output. Our evaluation has demonstrated that every £1 of tax incentives generates an additional £1.89 of net gross value added. We also support CDFIs through the regional growth fund by contributing £30 million to the sector to facilitate £77 million of lending through small loans—around 4,500 loans—to small and micro-businesses.

In addition, we are about to launch a pilot scheme at the end of this month to help young entrepreneurs set up their business and access finance when doing so. Aimed at 18 to 24 year-olds, the start-up loans scheme will provide microfinance and mentoring support to enable young people to start and grow a business.

I have focused so far on debt finance. The Government are also committed to supporting equity funding. We have committed £200 million over four years to the enterprise capital funds programme, bringing our investment to more than £300 million for SMEs with the highest growth potential. We are also working to stimulate business angel investment through the establishment of a £50 million business angel co-investment fund. This partly addresses my noble friend Lord Popat’s point. Through this, we co-invest with business angels in high-growth-potential early-stage SMEs, particularly in areas most affected by public spending cuts. My colleague Mark Prisk announced the first deals under this scheme earlier this month.

However, we are not limiting our support to finance itself. To help businesses navigate the various support programmes, we have launched the “Business in You” website to help businesses access support and mentoring and determine which financial support package suits them best. The growth accelerator programme will also provide intensive management and training support to high-growth-potential SMEs.

Noble Lords asked a number of questions. I will address as many of them as I can. My noble friend Lady Kramer compared the German, US and Swiss local banks and their emphasis on localness favourably against our branch networks; my noble friend Lord Smith made a similar point. We recognise the value of the bank branch network and relationship banking for SMEs, where the manager knows the area and understands the business. Indeed, these values are still present in the UK banking sector. In particular, some of our smaller banks have chosen to adopt more traditional banking models, with an emphasis on good customer service, personal relationships with customers and local focus to operations. The larger banks, too, recognise the importance of having managers with a clear understanding of businesses and the local area.

However, my noble friend makes an important point, and the Government remain committed to ensuring that viable businesses can access the finance that they need at an affordable rate. My noble friend suggested that RBS’s network should be used as the basis of a regional banking network. The Government’s shareholding in the Royal Bank of Scotland is managed on a commercial and arm’s-length basis by UKFI, whose overarching objective is to protect and create value for the taxpayer as shareholder, with due regard to financial stability and acting in a way that promotes competition. Splitting it up into a regional banking network might be a considerable undertaking and would take a fair while. It is uncertain whether it would improve lending conditions for small and micro-businesses. However, UKFI continues to work closely with the bank’s management to assure itself of the bank’s approach to strategy and to hold it rigorously to account for performance.

My noble friend suggested that credit unions and CDFIs are too fragmented and small. That chimes with something that the noble Lord, Lord Myners, said; he was basically sceptical of alternative forms of finance in general. The Government recognise the important role that CDFIs play, but are aware that the sector needs to operate on a greater scale to widen their coverage across the United Kingdom. The Government’s regional growth fund award of £30 million will help to address this issue, as it will facilitate £77 million of lending. It will also allow the Community Development Finance Association, which developed the fund, to build its capacity and capability to act as a wholesaler to the sector. This will allow it to look to private sector funders and European institutions. This, combined with the community investment tax relief and enterprise finance guarantee scheme, will enhance the sector’s capacity to grow.

My noble friend was critical of the barriers to entry to the banking industry; a number of noble Lords referred to that. All prospective new banks must apply for and receive a banking licence from the FSA. This is an essential step to ensure that all banks in the UK operate to the required standard and that consumers are protected. It is right that standards are robust. The FSA has, however, recently implemented a number of improvements to the banking licence process which will make it easier for potential new entrants to navigate. These include holding pre-application meetings with the applicants and the introduction of a modular approach to assessing deposit-taking applications.

My noble friend suggests a less onerous licence for small, local banks with a community obligation. We are clear that prudential standards for capital and liquidity should not act to dampen the effective competition and that new banks should not be treated disproportionately subject to the level of risk. That is why we have supported the Independent Commission on Banking’s recommendation that the OFT should work closely with the Prudential Regulation Authority to review the application of prudential standards, to ensure that they do not pose excessive barriers to entry and expansion from new entrants.

My noble friend was concerned that the new online lenders should be regulated under the Consumer Credit Act and by the OFT, and about the feeling that the responsible players are bracketed with the cowboys. The Government have noted the online peer-to-peer lenders’ concerns and are keeping the case for further regulation under review. Any decision to regulate would need to balance the needs of borrowers and lenders and the possible impact on new market entrants.

I am afraid that I am running out of time, so I will write to noble Lords whose questions I am unable to address. My noble friend Lord Popat had several. He was concerned about low participation in government lending schemes and the poor publicising of schemes available. We recognise the lack of awareness of government schemes and, following the Breedon review earlier this year, we have already committed to consider how best to improve awareness of such schemes. We are working to raise understanding of the support available to SMEs, including through a new online finance finder tool at

The noble Lord, Lord Myners, referred to the Vickers report. I enjoyed his thought-provoking speech. Let me just answer his point. The Government welcome the work of Vickers and further analysis is ongoing to confirm the detail. As the noble Lord said, a White Paper and formal consultation will be launched next month.

The noble Lord, Lord Berkeley, raised a very important point. May I say, rather rudely, that most of it was slightly outside the scope of this debate? However, I can see exactly where he is coming from. He addresses the finance that is available to suppliers—for example, to National Grid. The Government acknowledge that this is an important issue. Many SMEs report that working capital and late payment are obstacles as great as access to external finance. Mark Prisk has convened a working group with business representative bodies to explore how to tackle this issue, which also relies on SMEs agreeing payment terms in advance.

Several noble Lords referred to Project Merlin, through which the banks have lent £215 billion to businesses in the United Kingdom, including £75 billion to SMEs against a target of £76 billion. I acknowledge that they have not hit the target by £1 billion in £76 billion, but this none the less represents a 13% increase in gross lending on 2010 and Project Merlin has clearly focused the minds of senior bank officials on SME lending.

My Lords, I am sorry—I am out of time and I cannot allow interventions. I have to conclude.

As I hope noble Lords can see, we have a large menu of measures to support the provision of diverse sources of finance. We will carefully assess the impact of these policies to ensure that businesses of all types are able to access the finance that they need.

House adjourned at 5.33 pm.