At the end of this debate, for the first time, at your request and indeed instruction, Madam Speaker, the House will observe the two-minute silence while the House is sitting. It is appropriate that we are debating defence in the context of Europe. It is also appropriate that we should mark the 80th anniversary of the armistice, which followed a 100-day campaign of victory by the greatest land force ever assembled by this country.

Contrary to popular myth, that was a highly professional, well-led and supported military force which comprehensively defeated an aggressive, expansionist and militaristic enemy. That army was a citizen's army. It, and the professional army from which it grew, had paid a fearful price to achieve a world war-winning level of competence. We should be proud of their achievement.

We will also remember the price that was paid by hundreds of thousands of our fellow citizens and by millions of our fellow European citizens in the wars that have scarred this continent this century. That is why I believe that defence remains the most important responsibility of any Government, and it reminds us of the importance of today's debate.

I put in for this debate because something is happening with defence policy in the European Union and the House has not been told. Now is the chance. We look forward to the speech of the Under-Secretary of State for Defence in the anticipation that it will be followed by a two-minute silence not only of remembrance, but, I hope, of stunned astonishment that we have learnt something from him about the Government's European policy.

On 1 July, the Financial Times reported:

"Tony Blair has recognised that his ambition of carving a powerful role for the UK within the European Union could take 10 years and has commissioned a sweeping review of the UK's approach to the EU.

Officials said it was crucial for the UK to demonstrate it favoured closer integration in a number of areas, such as foreign and defence policies."

On 2 October, we seemed to have arrived at the conclusion of that exercise, when the extremely well-informed Robert Peston of the Financial Times reported:

"The government is putting the finishing touches to a blueprint on Europe, which it hopes will pave the way for Britain to play a leading role alongside France and Germany.

The blueprint includes a controversial recommendation that the European Union should assume a defence capability—a move which would signal the biggest shift in policy since Labour took office.

Mr. Blair … is expected to make a decision ahead of this month's EU summit where member states will discuss the future of the Union.

To this end, the Foreign Office, with guarded support from the Ministry of Defence, is recommending that the Western European Union, the EU's embryonic defence arm, should be scrapped."

Those reports did not pass unnoticed. They were raised by my right hon. Friend the Member for Wealden (Sir G. Johnson Smith) and by my hon. Friend the Member for Stratford-on-Avon (Mr. Maples) in the strategic defence review debate, but they were not referred to specifically by the Under-Secretary of State for Defence in his reply on each day of those debates, so imagine our surprise on reading The Times headline of 21 October:

"Britain to back defence role for Europe."

One might have been forgiven for thinking that the article could have been reporting our debate, but no. Philip Webster reported:

"Britain is prepared for the first time to give the European Union a defence arm that would allow members' troops to co-operate in mounting military operations, the Prime Minister signalled last night.

Tony Blair made plain that he was ready to drop Britain's longstanding objections to the EU having a defence capability".

As the House was debating defence at 4.30 on Tuesday 20 October, the Prime Minister was talking to journalists from six leading European newspapers, including The Times, Le Monde and the Frankfurter Allgemeine Zeitung.

Just in case anyone tries to suggest that Philip Webster was exaggerating what the Prime Minister was saying, let me point out that, following that interview, the Frankfurter Allgemeine Zeitung reported that

"the Blair Government has decided to give its European partners a pleasant surprise for once. The informal meeting of "Heads of Government in P6rtschach at the weekend will provide the setting."

It said that the Prime Minister

"announced for the first time that London would abandon Britain's long-standing opposition to a firmer structure to Common Foreign and Security Policy."

That means that London will no longer oppose the appointment of a Mr. CFSP. That is not exactly news, as the previous Conservative Government, in their 1996 White Paper, said that they were ready to look at the idea of appointing a single figure to represent the policy of the Union to the outside world. I assume that the Labour Government have picked up Conservative policy in this area, as they have done in many other areas. When they followed Conservative policy on the economy, they did rather well; having abandoned it, they are in trouble.

Perhaps the Government should re-examine their policy on the Territorial Army and follow Conservative policy. We very much regret the rumours about an announcement in the House next Monday on the Territorial Army, some three weeks before the Army is ready for that. It is disgraceful that the announcement is being dragged forward to get it out of the way before Prorogation, much to the danger of the TA.

On what does the hon. Gentleman base his speculation about an announcement next Monday?

I was informed by someone in the BBC—presumably a most reliable source.

My hon. Friend is absolutely right. Indeed, the Secretary of State for Defence answered two parliamentary questions on the matter yesterday—as reported in Hansard this morning—and confirmed that there will be a statement on the Territorial Army next week.

It is much to be regretted that the Army is having to drag forward any announcement.

Why is the hon. Gentleman complaining about the matter being brought early to the House? In view of all the ill-informed speculation, I would expect him to want the House to be informed. Why is he complaining about the House being given early information? I fail to follow his logic.

It is very simple—a most ungainly exercise is taking place inside the Territorial Army, as different parts of the Territorial Auxiliary and Volunteer Reserve Association and different regions are engaging in what my local TAVRA representative referred to as "horse trading" over which units would be placed where, which would survive and which TA centres would be sold. The speed with which this is happening means that the TA will be left inadequately staffed. We regret the fact that the Government are taking no notice of the unanimous recommendation of the Select Committee on Defence that they should think again because their policy is misconceived. However, this is a diversion from European Union defence policy, to which I shall now return.

The previous Conservative Government had accepted a Mr. CFSP—a Mr. PESC in France. As the German for "common foreign and security policy" is "gemeinsame aussen and sicherheitspolitik", the Germans are happy to have a Herr GASP—or perhaps a Fraulein GASP.

Although the news about a Mr. CFSP was not news, the conclusion drawn by the Frankfurter Allgemeine Zeitung from the Prime Minister remarks was. It said:

"In the medium term, London is therefore now also questioning the role of the Western European Union … to which 10 or the 15 EU Member States belong. For as soon as the European Union adopts its own 'security policy identity', which the British government no longer intends to oppose, the WEU would become superfluous. Its political role would fall"—

The hon. Gentleman has referred to the debates on 24 and 25 October, but I want to quote back to him what was said by my right hon. Friend the Secretary of State for Defence. At a meeting at which I was present, my right hon. Friend said:

"Nato must remain the cornerstone of European defence but Britain would consider reinforcing the Western European Union"—

the very point—

Carry on with the quote.

I am going to do that. My right hon. Friend continued:

"creating a more distinct European dimension within NATO or even merging the WEU and the EU."

Perhaps the hon. Member for Reigate (Mr. Blunt) would respond to that. A week after my right hon. Friend the Prime Minister made the remarks quoted by the hon. Gentleman, my right hon. Friend the Secretary of State for Defence was quite clear on what the exercise was all about.

I look forward to hearing from the Under-Secretary of State exactly what the Government are up to. The House should have the benefit of a clarification of the Government's policy. That is what this debate is about and I look forward to the Under-Secretary's response to it.

I was quoting the Frankfurter Allgemeine Zeitung. It stated:

"The WEU would become superfluous. Its political role would fall to the EU and its military role to NATO. Blair's ideas are supported by the Foreign Officeand Defence Ministry, although the latter has certain reservations."

We look forward to hearing what those are. It continued:

"In the long term, this would mean the establishment of something akin to a European Foreign and Defence Ministry."

Le Monde directly asked the Prime Minister:

"Do you support the idea of abolishing the WEU and transferring its military resources to NATO?"

He replied:

"There are all kinds of ideas and many admit that the WEU is less than the ideal instrument which we need. I believe that we must think in a more imaginative way than we are doing."

That is hardly a ringing endorsement of the WEU. What conclusion are people supposed to draw about the future of the WEU from those remarks?

The Prime Minister is considering a very substantial change which, in the light of the Amsterdam treaty, would stand the whole of the Government's approach on its head. I wonder whether other Ministers knew of it. There are rumours of Foreign and Commonwealth Office and Ministry of Defence papers for and against the ideas suggested—yet, when Defence Ministers were debating defence in this House, particular points were put to them, but they were unable to say whether those ideas were being considered.

I am aware that the best way to keep a secret in this country is to make a speech on the Floor of the House. I refer the hon. Gentleman to column 1176 of Hansard on 20 October, where I dealt precisely with the points raised by the right hon. Member for Wealden (Sir G. Johnson Smith) and the hon. Member for Stratford-on-Avon (Mr. Maples).

I read those remarks carefully because I had assumed that the Under-Secretary would deal with the matter. However, they do not bear any resemblance to what the Prime Minister was saying on the same day to journalists from The Times and other European newspapers.

Can the hon. Gentleman tell me what incompatibility he perceives between my comments at column 1176 and what my right hon. Friend the Prime Minister said?

Yes. The Prime Minister spoke about the potential abolition of the Western European Union, but there was no suggestion of that in the Under-Secretary's remarks in the House. He spoke about the importance of NATO in European defence, and we all agree with that. However, the institutional framework in which NATO will operate and the relationship with the European Union are central to the issue. The problem is that the Prime Minister is dealing with a big idea, but he has no idea of the detail. Indeed, I shall shortly put some detailed points to the Under-Secretary. When we debated defence, what did the Under-Secretary know about the proposals for the WEU? What does he know about them now?

The Prime Minister's Cabinet colleagues were caught unsighted. The Minister for the Cabinet Office initially denied, in this House, that the Prime Minister had even briefed Philip Webster. He then retreated behind the solecism that it was not a briefing, but an interview on the record—a distinction lost on the Frankfurter Allgemeine Zeitung, which described the meeting with the Prime Minister as "a pre-summit briefing".

The Leader of the House said that the Prime Minister was simply saying that he wanted some imaginative thinking on how to enhance the European contribution to NATO. If that is what the French thought the Prime Minister was up to, he would have got extremely short shrift at the summit in Austria. What is certainly the case is that Members of this House did not know what the Prime Minister was doing. I raised the issue in our debate on the Army, but did not have the benefit of a response from the Under-Secretary. I raised it through an early-day motion, to which I have had no reply. The Under-Secretary' s colleagues, the hon. Members for Leicester, East (Mr. Vaz) and for North-East Derbyshire (Mr. Barnes) raised the matter on the Floor of the House, and asked for a statement and an explanation.

The Times also quoted the Prime Minister as saying:

"All I am saying is that we need to allow fresh thinking and it is important for Britain to be part of that thinking … and not for us simply to stand there and say 'we are not part of this'."

May I suggest something revolutionary? What about Parliament being exposed to this fresh thinking? Although we look forward to the Under-Secretary's reply, we probably need the Prime Minister here to answer the debate. The Prime Minister may think that his colleagues do not need to be aware of his proposals, but the House should be made aware of them.

In the Prime Minister's absence, it is a pity that—I say this with due respect to the Under-Secretary of State for Defence—the Minister for the Armed Forces will not be replying to this debate, as his experience as the Minister with responsibility for Europe and the man who signed the Amsterdam treaty would equip him admirably to provide that reply. Then again, as a fellow Oxford-educated public schoolboy socialist, the Under-Secretary may have the advantage of having a clearer insight into the Prime Minister's thought processes. In the absence of a communiqué from the summit in Austria, where ideas and proposals were floated by our Prime Minister, and in the absence of any statement to the House, we seek guidance.

My approach to the Minister is made in a spirit of genuine inquiry. What is going on? We can hardly be blamed for being suspicious. Are the proposals merely an exercise in image building—an attempt to curry favour with our partners? Are they, as I fear, concession of a substantial position and the British interest, with no substantive proposals, strategy or endgame in mind? They seem horribly reminiscent of other of the Government's constitutional proposals—which sound good, but are out of control and are damaging once battle is joined over the detail, when Ministers belatedly discover that the initiative has passed to those who do not share the United Kingdom's agenda.

I hope that the Minister will answer some specific questions. Are the Amsterdam arrangements for the relationship between NATO, the WEU and the EU to be reviewed? If so, why? The arrangements have hardly begun. Why cannot the arrangements be given a chance to bed down and to work?

Perhaps the Minister can tell us when the Amsterdam treaty came into force or will come into force. I have been unable to ascertain the date. The treaty states that it will come into force

"on the first day of the second month following that in which the instrument of ratification is deposited by the last signatory State to fulfil that formality."

The Minister will know, or certainly should know, that that date is important, as the protocol to article J.7 of the treaty states:

"The European Union shall draw up, together with the Western European Union, arrangements for enhanced cooperation between them within a year from the entry into force of the Treaty of Amsterdam."

Has that happened yet? Are the Government's proposals part of that process? If so, surely scrapping the Western European Union is hardly consistent with the treaty of Amsterdam.

When does the Minister believe that the next intergovernmental conference will be held to negotiate the new treaty which will do away with the Western European Union and rewrite the treaty of Amsterdam? Will he tell us what he believes to be the future of the WEU?

In the proposals, how are the aspirations of the neutral countries that are already inside the EU to be accommodated? Are the Government prepared to concede that the structure should be in the second, or CFSP, pillar of the European Union? If the WEU is no longer to exist, does it matter whether it is in the second or fourth pillar? What are the issues at stake?

Has any thought been given to enlargement? If the EU comes with an explicit security guarantee, will not that cause problems for the Baltic states? Would not an implicit security guarantee far more effectively enhance their security, without the risk of provoking Russia, which will be in God knows what condition in 10 years?

If we are to have a single money and a single economy—something to which the Government are, in principle, committed—why do we not move towards a common defence policy, and not least down the road of defence specialisation, as proposed by the Liberal Democrats? Although such a policy would be the end of our ability to act independently, it would force us to face up to the fact that, if economic and monetary union is not to fall apart, democratically accountable institutions have to be created at the European level to deal with issues of wealth redistribution, fiscal policy, macro economic policy and monetary policy. Why should such institutions not be created to deal with defence as well? It is the logical end of the path that the Prime Minister is taking us down.

My hon. Friend is making an extremely good case on why we should be given a better explanation. From his own experience in both the forces and the Ministry of Defence as a special adviser, can he think of any occasion in the recent past on which a common defence policy, if one had been created, would have affected our capabilities? Does he think that we as a country would have been able to act as well and effectively as we did in the Gulf, for example, if we had had a common defence policy, as is now being described?

The short answer is no; neither in the Gulf war nor in the Falkland Islands would we have been able to act as effectively. If we had had a common defence and common defence forces in the absence of common democratic structures at the European level to direct those forces, those events certainly would not have happened. If we had had European-level direction—which we shall assume was democratically accountable, within the United States of Europe, about which some Labour Members are probably enthusiastic—would it have been prepared to support the United States in the Gulf? Would it have been prepared to support the United Kingdom's interests in the Falklands Islands? I think that those questions would have been answered in the negative.

The hon. Gentleman will recall that, when the Falklands war broke out and there was some havering in Washington, on the first morning after war started, the first national leader to telephone Mrs. Thatcher to offer her complete and unconditional support was President Mitterrand. He immediately provided to the Ministry of Defence details of how the Exocet missiles were organised and operated. The great complaint was that British arms exporters were running to their clients in Arab countries saying, "You can't trust the French; they'll give away the details of their Exocets. Buy British, not French."

I am grateful for that intervention. The hon. Gentleman's comments are perfectly correct; the French did us an enormous favour in allowing the fleet to exercise against Super Etendards equipped with Exocets on their way down to Ascension island. However, had the Spanish and Italian Governments been part of a European set-up, how keen would they have been to support the policy of retaking the Falkland Islands from the Argentines? It begs the question of what capability the United Kingdom would have had to act in recovering our possessions.

I am grateful to my hon. Friend for giving way a second time, especially as we are dealing with a slight distraction from his main theme. Leaving aside the Falklands—although we could discuss the mechanics who were assisting in servicing the Super Etendards that were flying against the British fleet during the Falklands war—does he recall Mitterrand's actions, up to the 59th minute of the 11th hour, in undermining western diplomacy against Iraq in the Gulf, and also the assistance that the Belgian Government gave us? Mitterand sent a delegation to Iraq about one day before war broke out, contrary to the policy of the other western Governments, and the Belgians failed to supply us with ammunition, because they thought that doing so might upset their Iraqi contracts.

The interventions are extremely interesting, because they demonstrate that different European states have different national interests. I think that the question of whether they can be brought together at some European level would have to be answered in the negative.

We need to know the Government's endgame. If we believe that British independence of action is worth preserving and that our country's alliance with the United States should be central to our foreign and defence policy, we should have some answers to the questions that I have asked the Minister. This is a constitutional adventure too important to be left to the Prime Minister's sound-good politics. His colleagues who have a better eye for detail and the potential pitfalls ahead need to get a grip on the policy. I look forward to hearing that the Ministry of Defence, at least, knows where the policy is headed.

I shall concentrate on the new emerging Europe, which introduces a further dimension and perspective that calls for review, although I still accept the common defence policy.

Let me declare my interest as deputy leader of the British delegations to the Council of Europe and the Western European Union. I have spent the past 10 months producing a rapporteur's report on our intelligence section rapid response control and command system, which will be presented to the WEU in Paris in the first week in December. I was, therefore, somewhat alarmed by the statement in October which attempted to define the British review policy.

I hope that the new emerging Europe will play a positive part in establishing peace, stability and security throughout Europe and the world. The current and previous British Governments genuinely supported that aim. I remember the former Prime Minister, the right hon. Member for Huntingdon (Mr. Major), clearly and distinctly spelling out his support for the WEU at a conference at Church house about six months before the general election.

In my view, Europe must be a community of free member states. I reject the concept of a European super-state. The European Union must be based on a sharing of national interest and not on the surrender of national identity. That is particularly important in relation to defence.

I see no case for merging the common foreign and security policy into the bureaucratic machinery of Brussels. The establishment of a European army would limit our freedom and flexibility in respect of engagement in any war or military crisis—for example, in Kosovo or anywhere in the Balkans, which are somewhat volatile at present. However, the nations of Europe need each other. We are interdependent and carry the weight of great trading blocs, so it is imperative that we present a common front to the world. Our foreign and security policy must first be a defining expression of national identity. We must then proceed to unite Europe in a common defence policy while continuing to maintain and safeguard our independent national interest.

In my view, the best way in which to achieve that aim is to strengthen the WEU and give it a more positive role working with the United States, which always has been and, for at least the next 20 years, will continue to be, the cornerstone of our European defence. I see no reason to change something that has worked incredibly well.

I know that my hon. Friend the Minister will respect the views of all right hon. and hon. Members on defence issues. I believe that we should take an open view on how we should safeguard our future and that of our European colleagues. I make no apologies for having voted—first at the Council of Europe and then at the WEU—in favour of welcoming former eastern bloc and Soviet Union nations.

When I met Vice-President Gore some 18 months ago, we discussed the European dimension. We should bear in mind the fact that America has 300,000 troops in Europe, and that maintaining them there represents an economic problem. It is clear that Russia, Romania, Bulgaria and other emerging nations will have to take a positive role in any European defence system, so it is necessary to review our commitments in Europe. In my view, the WEU should take an important role. It has the experience and expertise, and is modernising its approach, as is clear from my rapporteur's report.

We have always supported the NATO alliance, for which we should be extremely grateful in terms of our security in Europe over the past 40 years. Mainly thanks to NATO, we have seen the total elimination of the Warsaw bloc. Certain former Soviet nations are still haunted by their relations with NATO in the past and, even though they are now co-opted members on certain consultative committees, they remain wary of the United States.

We should be firmly committed to the enlargement of Europe to the east and accept the necessity to embrace and support the new democracies of eastern Europe. We would be foolish not to do so. History will judge us harshly if we leave the door shut in their faces or allow their countries to slide back into totalitarianism. That applies equally to economic and military matters.

NATO and its participating Governments must confront and resolve three issues. The first is the future of the transatlantic relationship. Certain groups in America favour a gradual withdrawal of troops as soon as Europe can take care of itself. Secondly, we must review NATO's wider security function, including its possible use of out-of-area missions. Thirdly we must consider the future of "Partnership for Peace" and the recent NATO enlargement.

We must also redefine the transatlantic relationship so that any British Government, of whatever political disposition, will know which direction to take.

We must also consider NATO's wider security role. My hon. Friend the Member for Chorley (Mr. Hoyle), who has a great interest in defence matters, spoke about the role of our defence forces. I have just visited one of our frigates in the Gulf, HMS Cumberland, where I was informed of the importance of having available aircraft which do not have to fly 3,000 miles to a military emergency. Mobility is crucial to the question whether we merge certain parts of the Air Force and the Navy in response to the demand for flexibility.

In conclusion, although certain fundamental changes have not been made, and I have read from A to Z the speech that my right hon. Friend the Prime Minister made in October, it is clear that there is a flexible approach—

Which of the Prime Minister's speeches has the hon. Gentleman read from A to Z—

The one that my right hon. Friend made at the summit at Portschach in October—

Order. The hon. Member for Leigh (Mr. Cunliffe) is being intervened on. He must wait until the hon. Member for Reigate (Mr. Blunt) has finished speaking before responding to him.

If the hon. Gentleman is giving us an account of what happened at the summit in Austria, which so far has failed to be communicated to the world, we look forward to hearing what it is and what authority it carries.

Well, what was said was based on the Amsterdam treaty. The Prime Minister outlined the agreement to modernise and strengthen the system of defence control. Most of the quotations that I have are about a better military capability. There are references to

"more modern, flexible, sustainable and deployable forces"

and

"drawing on the lessons of the success of NATO."

We all agree on that.

Will the hon. Gentleman confirm that he has seen the full text of what the Prime Minister said? One of the difficulties is that No. 10, the Foreign Office and the Ministry of Defence have said that there is no verbatim text of the speech. We have all had to rely on press reports. Has the hon. Gentleman obtained a verbatim report?

I do not have a verbatim report. I have quotations from Reuters. 1 assume that Ministers have seen them, in view of what they said the week after, which I quoted earlier. Ministers have made it clear that NATO is the cornerstone of our defence policy. I have already talked about tidying up and modernising. There has to be a flexible response with a review. The breakup of the Warsaw pact has meant that there is now a positive military input from some eastern European countries. We did not have that before.

This is an important debate. I have known the Minister for many years and he deserves his current position. I am sure that he will try to inform the House to the best of his ability of present and future policy, as far as is permissible for security reasons.

I congratulate the hon. Member for Reigate (Mr. Blunt) on choosing this subject and having the debate on such an appropriate day for considering defence co-operation in Europe.

I returned yesterday afternoon from a meeting of the Western European Union in Paris, where we were discussing the future of the organisation. The impression given by members from other European countries was very depressing, arising from what the Prime Minister had said. Questions were asked about Britain's future co-operation in the WEU. As I drove back across northern France, past the Somme and Picardy, I thought about the trauma of the experiences 80 years ago and what has been achieved since. Sadly, we have had to fight another world war and, in most of the years since the end of the first world war, British troops have been engaged in active service somewhere in the world. Only one year has passed since then without British troops dying somewhere in the world defending people's rights and freedom.

The great war showed the need for European nations to co-operate. The hon. Member for Leigh (Mr. Cunliffe) rightly said—I imagine that most hon. Members and our European partners agree—that, when Britain signed the Amsterdam agreement, we were signing up for a strengthening of the WEU's position in the family of European organisations. Our continued support for the WEU was clearly stated by signing the treaty. There are six organisations covering Europe and our north Atlantic allies, ranging in size from the European Union, with 15 members, to the Organisation for Security and Co-operation in Europe, with 56 members. The WEU was singled out among those six for special consideration. The Prime Minister was wrong to cast doubt on the future of the WEU.

The Secretary of State for Defence will be with us in Paris at the start of December. I hope that, in the hour or so that he will have to present several topics to the Assembly, he will state the Government's position on the WEU clearly. Anything short of that will give credence to the suggestion that Britain is looking for an alternative based on the EU. I do not regard that as a practical solution. It is fraught with difficulties, it would lead to endless, unnecessary argument and it would destroy a lot of the good will of the countries from the former Soviet bloc that have become associated with the WEU and see it as a focal point for making partnership work. "Partnership for Peace" and many other organisations do not have a cat in hell's chance of long-term success unless the WEU is strengthened.

We have to look around at experience of what organisations can deliver. Colleagues at the WEU considered an interesting report over the past couple of days called "New Prospects for Transatlantic Co-operation in Security and Defence", produced by Mr. Blaauw, vice-chairman of the political committee. He is a much-decorated service man who is now an experienced leading politician in the Netherlands. His report points to some of the issues that are sometimes forgotten, including the difficulty of gaining co-operation for the United States to free up some of NATO's assets for use by the WEU.

We ought to ask the Prime Minister and the Secretary of State for Defence to talk to our American allies about greater co-operation with the WEU. Sadly, the Americans are reluctant to do that. It is a pity that they are not more visionary in exploring the opportunities offered by the WEU. Albania, for example, has been ripped apart by strife. NATO and the United Nations could not have gone in, but the WEU did. The policing of Albania by the dark blue berets of the WEU is a significant contribution to bringing some sense to the turmoil there.

The WEU has a real role to play. If European co-operation is to mean more than just co-operation on procurement projects—if it means seeking true partnerships for peace and trying to work out a European dimension for sorting out problems—three things are necessary. First, this House must be paramount in deciding what is in the best defence interests of this country. That should always be discussed here first, not speculated on even by the Prime Minister at conferences elsewhere until he has clearly put his thoughts to the House. Such far-reaching issues, which would have repercussions way outside the United Kingdom, should be dealt with here first.

Secondly, we must make sure that everybody signs up for an organisation that can deliver. The WEU is trying to adapt itself to the new future for Europe. It is trying to accommodate the rights of individual states and make partnership work.

Thirdly, and most importantly for Europe, there must be credibility in Europe for the organisation. The WEU has such credibility. Britain's 36 representatives from all parties and both Houses of Parliament–18 full members and 18 substitutes—have a clear influence in its policy making. As a member of that organisation, I have felt undermined by recent speculation.

Sadly, there has been no attempt to clarify the matter, and this debate is the first opportunity that we have had for that. I hope that the Minister will respond in a robust and up-front manner, and experience suggests that he will defend his position robustly. However, the House will be interested in the factual information that we need.

If we do not get that information today, I am afraid that those hon. Members who are predicting doom and gloom within the WEU—and who are possibly undermining other institutions in Europe—will, sadly, get backing from an unusual source, the British Government. The Government should instead be giving positive backing. They should say that there is a role for the organisation, that Europe does matter, that we want to play a part in it and that we want our role to be within the WEU.

I congratulate my hon. Friend the Member for Reigate (Mr. Blunt) on introducing this debate, and I thank my hon. Friend the Member for Leigh (Mr. Cunliffe) and the hon. Member for Portsmouth, South (Mr. Hancock), who took part in the debate. It is important that we discuss defence often. I see no problem with what the Prime Minister, my right hon. Friend the Secretary of State for Defence or anyone else says if it means that we have an open discussion. It is healthy to keep all options open, but we should always come here to debate whatever takes place in Europe.

I am grateful to my hon. Friend—to return his compliment. However, we have had to drag the Government here, and Labour Members have been asking for Government statements. Surely he dissociates himself from the fact that the Government have not been prepared to come to the House to make a statement. It has been left to me to drag the Minister here.

I do not think that the way forward is to score cheap political points, and I shall not enter into that. We want an open debate, and I have confidence that my hon. Friend the Minister will give us clarification.

Members on both sides of the Chamber are never frightened of discussing defence. We have always displayed good, honest views, and that will never change. I am reassured by the statement that NATO must remain the cornerstone of the EU's defence, but that Britain will consider reinforcing the Western European Union, and will try to create a more distinct EU dimension within NATO. We need to be told whether we are to have an EU force, or whether the WEU will continue. I welcome this debate, which gives us the opportunity to discuss whether the changes are essential and whether they will work.

The burden on our forces must be remembered. We have mounted operations in the Falklands and the Gulf, and there are problems within the former Yugoslavia. Time bombs ticks way and explode here, there and everywhere. We may even see problems in the Baltic states—we do not know. British forces, rightly, are at the forefront, and are a shining example of our commitment to peacekeeping in Europe and the world.

I believe that the other European nations have a part to play. They must not just sit back, passing judgment on what is right and wrong. They must not pay lip service when problems erupt in the former Yugoslavia because, as we have seen, we cannot rely on the Americans, who do not wish to have troops on the ground. Our troops will have to be there, and that is a problem. Our troops' lives are being risked—not American troops, although the Americans will pass judgment. If we can bring in other European states and ensure that they play a major role—and that their troops are placed in the hot spots of Europe—I will welcome that. It is crucial that the Minister discusses whether we are to have an EU force or the continuation or expansion of the WEU.

We can have that discussion because we have democracy, and Parliament must retain the ability to discuss that issue. The countries we are sending forces to assist do not have those rights or the ability to enjoy that freedom. We must not lose sight of that.

We all look to Europe for future defence procurement mergers, and companies must merge to compete with the Americans. British Aerospace has said that it needs to ensure its future, and we must produce weapons with a European dimension. We all welcome that, and that is the way forward. Otherwise, we will always be reliant on the Americans.

Is the hon. Gentleman aware of the critical role that American research and development plays in our programmes? Is he aware that members of the Defence Select Committee, on a recent visit to Washington, were told again and again that the exchange of technology—which is principally beneficial to this country—would not be available if our defence industry became subsumed in a wider European defence industry?

Of course I welcome our work with the Americans, which will continue. However, the hon. Gentleman will be aware that the future large aircraft will come not via the Americans, but via the Europeans. We all beat the drum about the success of the European airbus, and we want to say that the future large aircraft—built in Europe for the world—will have a dual role. European manufacturers have a part to play, but I do not lose sight of our great allies the Americans, and NATO will be the cornerstone of America and the UK.

We need our own defence independence to allow us to fight in the Falklands—if conflict re-emerges—in the Gulf or in Africa, if we decide to try to keep the peace there. I do not want to rely on someone in Europe telling us where we can go. That fear has comes across today, but it is not necessary. I want to reassure everybody that we will have the independence to go wherever we are needed.

Gibraltar is an issue of tactical importance to the UK. We mounted the Falklands and the Gulf operations from there, and we must not allow Spain to come in the back way and take it away from us. We must work together within Europe, and play a leading part in Europe. There is a danger—which has become clear this morning—that the sceptics are allowing their view to cover everything.

Is the hon. Gentleman concerned that, given problems such as Gibraltar and Spain's designs on it, there is a danger that the development of a common European foreign and security policy might prevent us from looking after British and Gibraltarian interests?

No, definitely not. I must rule that out completely. I would not want to follow the example of the previous Government, under whom the people of Hong Kong were given back to China when there was no need. We must not allow that ever to happen again. [Interruption.] Hong Kong island was not part of the deal, and we could have held on to it for ever. The previous Government failed to negotiate on behalf of the people of Hong Kong because of their desire to get in bed with the communist Government. After Tiananmen square, the previous Government should have learnt something. They failed to do so. I always say that, if people have no desire to become part of another country, we must not allow that to happen. That is why I stand by the view of the people of Gibraltar, unlike the previous Government who did not stand by the people of Hong Kong, so Conservative Members should not lecture me on that matter. We must remember, and learn from, the previous Government's mistakes.

It is important that we are always willing to discuss, and look at, both sides of the argument and that we arrive at the right decision. Scaremongering is easy, but we should not allow it. There should be open discussion, then we will make the right decision. We can ensure that we look after Europe and that it looks after us. We are a part of it and we must not lose sight of that.

Crucially, we must always remember that British troops will be stretched unless there is some sort of European force—either a WEU or an EU force. British troops are always the first on the ground and they do an excellent job when serving overseas. No one can take that away from them. However, other European nations should tackle some of the problems in Europe instead of leaving it to good old Britain. They have a part to play. Hopefully, as a result of this discussion, or through the Prime Minister or my right hon. Friend the Secretary of State for Defence having discussions, we will find a way forward. If we can ensure that we get the right deal for the United Kingdom and our defence forces, I will not have a problem with it, as long as that independence remains. I believe that it will.

I congratulate my hon. and gallant Friend the Member for Reigate (Mr. Blunt) on his success in obtaining this important debate. I hope that he gets the answers that he sought from the Minister. I also congratulate all those hon. Members who have spoken. As is usual in defence debates, all those who have spoken care and know about the subject.

The House should not have to rely on the Opposition to haul reluctant Ministers to the Dispatch Box. We will haul them here at every opportunity, but how much better it would be if they were less secretive. If the Government were more open, they would not have leaks and the paranoia of the Ministry of Defence over the strategic defence review and the Territorial Army. That gallant soldier, General Sir Michael Walker, Commander-in-Chief, Land Command, would not have to issue letters saying that idle chatter on social occasions about the cuts would imperil military careers, or talk of press revelations eroding trust between military chiefs and "our political masters", and order his troops to avoid

"deliberate contact with the press or politicians".

As the Member of Parliament for Salisbury, I would have a pretty boring time at social events, in my surgeries and elsewhere, if that happened and I regret that it has been necessary for him to say it.

Three weeks ago, the House debated the Government's strategic defence review. At the very moment that the Minister for the Armed Forces was speaking, the Prime Minister was briefing the European press on the future of European defence policy. Unfortunately, the Prime Minister had forgotten to tell the Secretary of State for Defence or, if he had, the latter had forgotten to tell his Ministers who were speaking in the House. That was incompetent. The Prime Minister was incompetent, as was the Secretary of State for Defence. It was a muddle.

The Prime Minister went off to Portschach in Austria to tell the leaders of Europe that they were in a muddle over defence. Last week in Vienna, the Secretary of State for Defence tried to sort it all out. He said in his speech there that it was "a one-off informal conference"—it was so informal that he told the press that it was "a defining moment" for defence policy. The Secretary of State was asked about merging the European Union and Western European Union. He said:

"We do not rule it out, but it raises a number of difficulties"—

I'll say it does. He confirmed that other options include:

"merging some elements of the WEU with the EU and associating other elements more closely with NATO, or perhaps creating a more distinct European dimension within NATO."

Just for good measure, he added that one could also envisage

"reinforcing and reinvigorating the WEU".

So, the Prime Minister forgot to talk to the Ministry of Defence, but both he and the Secretary of State for Defence forgot to talk to the Foreign Office. That was also incompetent.

Yesterday, in another place, Government policy on EU-WEU integration was debated. The Under-Secretary of State, Foreign and Commonwealth Office, Baroness Symons, said, in column 627 of the Official Report:

"The Government are not focusing on institutional changes though these may come."

By column 629, she had warmed up a little and she said:

"the relationship between the WEU and Europe on the one hand and the WEU and NATO on the other is one on which a little more clarity from time to time would be helpful."

And so say all of us. By column 630, she was firing on all cylinders and she said:

"the common strategies developed under CFSP are subject to unanimity vote. However, the common positions which flow from those strategies are subject to qualified majority voting unless they are not covered by a common strategy. I hope that point is clear."—[Official Report, House of Lords, 10 November 1998; Vol. 594, c. 627–630.]

I am grateful to the hon. Gentleman for giving way, particularly because I spent the most invigorating morning with the noble Baroness Symons yesterday in Rotherham and sent her back to the other place all fired up. Is not the hon. Gentleman making an immense meal out of this? I am privy to no papers, but I read in the Financial Times that the proposal was outlined in a paper by Mr. Robert Cooper of the Foreign Office, one of our cerebral gentlemen there. I read all about it before Portschach. So, far from it being sprung on the Austrians, it was widely reported in the press. I suggest that the hon. Gentleman takes out a subscription to the Financial Times. He will learn much to his advantage.

First, may I say how surprised, but delighted, I am that the hon. Gentleman has visited Rotherham. I congratulate him. I do not need to take out a subscription to the Financial Times because I can read it in the Library of the House, along with The Sun.

Chancellor Klima of Austria has more definite ideas. He said at Pőrtschach, that a "new dynamic" has developed on the issue in the European Union and that he had observed the emergence of a "commitment" as regards a common foreign and security policy. He said that the Prime Minister's intervention on the subject, which included the "variant" of the "possible integration" of WEU into the EU, reflects a "movement" by London that cannot but be welcomed. Several summit participants commented that the European countries should have a common position on the subject by the time of the NATO summit in Washington in April 1999. However, Mr. Klima made a point of stating that the Vienna European Council should not be expected to indicate the time of a possible merger of WEU into the EU. That is a relief, but it is imposing a pretty tight timetable on the Government for that debate. In Vienna last week, the French Defence Minister, Alain Richard, was clear too, saying:

"No-one contests the importance of the transatlantic link for our security, but neither does anyone doubt that a Europe with a single currency cannot go long without a real defence and security dimension".

He considered that it would be "very useful" for discussions between WEU and NATO on the

"use of cores of CJTF headquarters in a European command chain".

All that evidence shows me that many people in Europe seem to be clear, but that this House is not, even if any member of the Government is.

What of our Italian allies? The Italian Defence Minister, Carlo Scognamiglio said that European military capabilities

"are not so limited or fragile as widely believed".

He said in Vienna that the Europeans can field more soldiers, ships or combat aircraft than the United States. However, he admitted that

"this numerical reality does not spell the operational truth".

According to Mr. Scognamiglio, one of the most striking aspects that emerged from those discussions was the fact that there was a

"gross lack of mutual knowledge among those forces".

He suggested the organisation of joint exercises and the development of exchanges between officers to remedy those shortcomings.

That is fine, but I thought that the Ministry of Defence was clear about the reorganisation of European defence industries—or has it been saying one thing in Brussels and another in the House? On 28 October, the Government published their response to the joint report of the Defence and Trade and Industry Committees on aspects of defence procurement and industrial policy. Recommendations q and I read:

"The Government does not support the creation of a 'Fortress Europe' … and it has consistently opposed any move towards a system of European preference which it believes is incompatible with the longer term competitiveness of European industry."

What of the views of the biggest country in Europe, Germany? Following the recent elections, an unlikely coalition emerged between the Social Democrats—always suspicious about defence—and the Green party—always opposed to defence, to large industries in general and to defence industries in particular.

In Baden-Baden, Defence Minister Rudolf Scharping said that he wanted to strengthen Europe's role in NATO. He said:

"I would like us to finally overcome our weakness in Europe and formulate a common foreign and security policy".

On Thursday, he said on Sildwestrudfunk radio that there must finally be a strong European pillar in NATO, which was not at all the case at the moment—"at least," he added,

"it is not as strong as it should be".

He said that he wanted to tackle that great challenge, but that nothing would happen until the new defence structure commission—Germany's version of the strategic defence review —had reported.

Unlike the British Government, who said that they would complete their review in six months, the German Government have said that the commission will take two years. The French and the Italians expect something to happen by early next year, but Germany is saying, "Hang on a minute. We aren't going to do anything for at least two years and then we'll let the world know what we think."

Of the Greens' demands to cut the size of the Bundeswehr, Mr. Scharping said that it made no sense to deal with abstract figures now and that conclusions for the future of the Bundeswehr could be drawn only after careful assessment of the situation. The coalition expressly agreed to take any budget and business decisions on the Bundeswehr only when the results of the defence structure commission were available.

The realities are different. In the Gulf war, Britain and France joined the US-led military coalition whereas other EU members refused to commit troops. EU members were unable to agree a common approach to diplomatic efforts to end the conflict. In the former Yugoslavia, they took different views on the recognition of Slovenia, Croatia and Bosnia-Herzegovina. The way forward in resolving the conflict in Bosnia—the when and how of using military force—was in disarray. Peace was established only when the US took the diplomatic and military lead.

In serious crises, the divergent position of EU members will undermine efforts to establish a common approach. The diversity of EU members and the distinctiveness of their national foreign policy traditions often make agreement difficult. The EU lacks the political institutions and instruments that are necessary for an effective common foreign and security policy. It has no collective foreign ministry to provide intelligence, analysis and political advice and it lacks mechanisms to ensure that member states implement common positions once they have been agreed. Mechanisms for collective action via the WEU are only now being developed, although, as I said in last week's Army debate, I welcome them.

The Government must deal with the muddle and confusion in their policy. I recognise that this country has new opportunities, but there is a fixed timetable in which to achieve NATO's new strategic vision. NATO has delivered peace and stability for Europe, whereas the role of the WEU has begun to emerge only since the Petersberg declaration.

The Conservative party does not oppose progress, which is vital; we oppose the Government's confusion. Strong defence is the Government's first duty to the country and their first duty to the House is to tell us of their new policy ambitions—they must not forget that they are accountable to the House. Ministers should not trot around Europe from hotel to hotel, spa to spa and conference to conference, speculating on the future of our defence. Infrequently, they issue communiqués, but mostly we have to rely on foreign press reports and selective press briefings in Whitehall.

In a few minutes, the House will be remembering that, 80 years ago today, the armistice that brought to an end the first world war was signed. Most of us lost relatives in those terrible battles. The loss of life was on a scale unimaginable today, when such carnage would be unacceptable. That is why, if we love peace, the people of these islands will always have to prepare for war.

There are always some who say that the sacrifices of the first and second world wars were futile. They were not futile. It is because our youngest, fittest, brightest and best risked their lives that our Parliament is today debating the future of the common defence of the peaceful, stable and expanding democracies that have grown from the ashes of the countries that twice this century tore themselves to pieces. In the abiding hope of peace and prosperity for Europe in the next century, we will remember them.

I congratulate the hon. Member for Reigate (Mr. Blunt) on securing what he rightly described as a timely debate on the European Union and defence policy. He strayed from that important subject by, among other things, disparaging Oxford. I do not know whether he has discussed that with the Leader of the Opposition or with some of his other colleagues; perhaps we are seeing a new fault line in the Conservative party.

I was astonished that the hon. Member for Salisbury (Mr. Key) mentioned the leaking of Government papers, especially after the results of the inquiry into the leaking of the White Paper on the strategic defence review. I should have thought that a period of silence on the subject would be appropriate.

As hon. Members know, the Amsterdam treaty will come into force when the final instrument of ratification is deposited. We expect that to be soon, although it will depend on the agenda of other national Parliaments. The treaty provides important new instruments to strengthen the common foreign and security policy. It also clarifies and sets limits on the defence aspects of CFSP and the role of the Western European Union in providing the European Union with access to an operational capability.

The Government have launched a wide-ranging debate in the European Union on the future of Europe. My right hon. Friend the Prime Minister opened the debate on defence and security issues at the informal European Union summit in Austria at the end of October and, as has been said, my right hon. Friend the Secretary of State for Defence reinforced that by leading the discussion at an informal conference of EU Defence Ministers in Vienna last week. Moreover, I dealt with the subject in the House on 20 October.

Hon. Members mentioned the problems that arose during previous crises. It is because of those problems that our aim is to enable the European Union to have a more united and influential voice, which may be articulated with greater speed and coherence through the common foreign and security policy. That voice must be backed up, when the need arises, with effective and prompt military action. The European Union must be able both to decide and to act quickly and effectively to achieve common goals. We believe that that will require some fresh thinking on the future direction of European defence.

Does my hon. Friend agree that it would be most welcome if the British Army and, indeed, the European armies, sent their engineering corps and regiments—our Sappers —to help rebuild central America? 1 know that I speak for the Territorial Army engineers in Rotherham, who would be delighted to help to rebuild bridges and roads and to bring some peace and hope to that devastated region. Britain could lead an armada for peace involving our European partners' armies and professional military engineers. Much equipment—including JCBs and bulldozers—is currently mothballed, so let us send it to central America, to show that our Sappers and engineers from other European armies can provide concrete help.

I join my hon. Friend in paying tribute to the enormous efforts of our troops in that appalling emergency. Further discussions are taking place on the most cost-effective and operationally effective ways in which to help in the full-scale reconstruction of the countries in that area, but I am sure that his comments will be considered.

The Minister said that the European Union must have the capacity to act. However, under the Amsterdam treaty, the EU will ask the WEU to act for it. Is he presaging a change in Government policy, whereby such capabilities will be given to the EU?

The hon. Gentleman will have to wait, as the later part of my speech will make clear the direction in which we are moving.

The changes are a development of our on-going policy, and accusations about a lack of co-ordination are, frankly, ludicrous. Britain has always sought to build strong foundations for European security. Under the post-war Labour Government, we were a founder member of both the Atlantic Alliance and the Western European Union. Since then, Governments of both parties have contributed to the successful growth and adaptation of those organisations throughout their history, as they have evolved to respond to changing circumstances, just as they must today.

We have played a key role in developing the European security and defence identity within NATO, an initiative launched at NATO's Brussels summit in 1994 under the previous Administration and strengthened in 1996 at Berlin. The first meeting of NATO Defence Ministers at the level of the North Atlantic Council in Brussels, 10 days after Berlin, attended by the then Defence Secretary, Michael Portillo, warmly welcomed the Berlin agreement and agreed to oversee the implementation of its defence and military aspects. I was slightly confused about whether the hon. Member for Reigate supported those decisions by the previous Administration.

We have also been a key player in developing the Western European Union's ability to enable Europeans to act together militarily: an idea that dates back to 1984, when the WEU was reactivated as the vehicle for developing a common European defence identity.

We are rightly proud of a defence capability that is respected and admired throughout the world, and will be all the more so following the implementation of the strategic defence review. We should also be proud of our readiness to intervene to help those in need and to stamp out violence and repression: to act as a force for good. It is right and proper that we bring our experience to the table and ensure that the debate takes a realistic and pragmatic course, reflecting our own interests, and that European rhetoric is turned into hard-nosed reality.

Contrary to the unfounded assertions of the hon. Member for Reigate, we are not talking about removing defence from the control of national Governments and national Parliaments. Of course, as the hon. Member for Portsmouth, South (Mr. Hancock) said, on behalf of the Liberal Democrats, member states must retain control of the use of their armed forces and the circumstances in which they are placed in danger.

We do not believe that it would be right for the European Commission or the European Parliament to have any direct role in those decisions; nor must there be any question of undermining NATO or attempting to duplicate it. NATO will rightly remain the foundation of our collective defence, as set out in article 5 of the North Atlantic treaty. That was explicitly recognised for the first time in a European Union context in the Amsterdam treaty.

Our aim is to strengthen Europe's position in the world. Europe's 370 million citizens expect and deserve nothing less. We want to ensure that Europe can speak with authority and act with decisiveness. For that to be a reality, European foreign policy needs to be coherent, responsive and credible.

There is no simple way of achieving that. Partly, it is a question of ensuring that we have sufficient common political will; perhaps even more importantly, it requires the establishment of an effective defence capability to underpin that will; and partly we need to get right the institutional arrangements that link the two.

Does it not show what an exercise in fantasy building the European military dream is for the Minister to speak of underpinning defence capability when it is so clear that countries throughout Europe, with the honourable exception of France, are in the process of slashing their military budgets? Projects are being cancelled in Germany at this very moment.

I am surprised that the hon. Gentleman should disparage, for example, the very effective joint amphibious capability that we have with the Dutch. That is an excellent example, and we want to develop that relationship. I am sure that he would agree that that is the right way to assert a proper European presence within NATO, which, as he would also surely agree, is the cornerstone of our defence policy.

The positive responses of our European partners to the speeches by my right hon. Friends the Prime Minister and the Secretary of State for Defence bear testimony to the timeliness and importance of our approach.

We cannot conjure up shared political will by waving a wand. We need only look at recent experience to see how difficult it is to agree policies that respect and accommodate the diverse interests of all our European partners, whose international postures range from strict neutrality to active interventionism. Having reached agreement, it is equally, if not more, difficult to respond rapidly to changing circumstances.

To take our place in the world we will need to move beyond that, towards a foreign policy that is both forward looking and proactive and has the ability to respond to fast-moving situations. That will provide a response to the criticisms of past practice that have rightly been made in the Chamber.

The Minister has still to address the Government's policy on the Western European Union. Nothing that he has said is inconsistent with a proposal to abolish the WEU. The Amsterdam treaty, which was signed by the Minister for the Armed Forces in his previous capacity, is not even in force yet, and the Ministry of Defence has yet to deny that a proposal to overturn the whole basis of the way in which our defence is treated is actively being considered.

We do not intend to be frightened by the various ghosts that the hon. Gentleman is conjuring up. It will be easier to get through this speech if I am allowed to follow on logically rather than being constantly interrupted.

We will need to exploit the instruments that were created at Amsterdam. The appointment of a high representative for the common foreign and security policy, with real standing and authority, will be a step in the right direction, and I welcome the hon. Gentleman's support for that. We will have significantly advanced our ability to decide and to react, but that will not be enough: we also need to enhance our ability to act.

If Europe is to have a stronger voice in the world, European armed forces will need to be capable of supporting our position. We need to put muscle behind Europe's foreign policy for those few hard cases when the normal instruments of foreign policy—trade, economic and political relations and diplomacy—are not enough.

Hon. Members will be aware of Kofi Annan's statement on his return from Iraq. He said:

"You can do a lot with diplomacy but, of course, you can do a lot more with diplomacy backed up with firmness and force."

That is frequently quoted, but it is a perfect encapsulation of what we should be striving to achieve for Europe, especially in those situations in which our North American allies are not directly engaged. We need to be confident that, when we call for action, we have the right means at our disposal to act. Having the right means will contribute, bottom up, to the process of building the confidence and the shared political will that European foreign policy needs.

rose—

We need a defence capability that is fit for today's world. We must recognise that future crises may arise anywhere and at any time. We need armed forces that are deployable and sustainable, powerful and flexible, mobile, survivable and highly capable. Those were the fundamental tenets of the strategic defence review, reflecting the approach that we have taken to modernising our armed forces better to suit their tasks of today and tomorrow.

Will the Minister still not give way? Hon. Members: Sit down.

Effective military capability and collective political will are clearly the key requirements. The institutional arrangements have been the focus of much speculation and coverage.

Surely the Minister must give way now.

If the hon. Gentleman wants me to get to the point that he wants me to cover, he had better stop shouting. The key is to be confident that, when we call for action, we have not only the right means at our disposal but the right mechanisms to act promptly. Mechanisms already exist to turn the common political will of the European Union into military action. The member states have agreed that the Western European Union should support the EU in framing the defence aspects of the common foreign and security policy and that the EU can avail itself of the WEU for operational purposes, relating to the Petersberg tasks, covering humanitarian and rescue operations.

At the Berlin summit in 1996, NATO declared its readiness to provide assets and capabilities to the WEU for European-led operations.

rose—

Sit down.

The procedures are cumbersome and we want to consider with our partners and allies whether it might be possible to streamline them to match our aspirations. In other words, once we make a decision, can we be sure that it will lead quickly and effectively to action? That may have institutional implications, but that is not where we are starting from. Our options include breathing new life into the WEU, which is important, but that option has pros and cons.

As we prepare to observe a two-minute silence to remember those who fell or were injured and those who lost loved ones in two world wars and other conflicts during this century, it is right that we recognise the enormous contribution that Europe's security institutions, especially NATO, have made to keeping the peace in Europe over the past 50 years. They remain relevant because they have evolved to reflect changing circumstances. We owe it to succeeding generations to ensure that we continue to work to preserve and to strengthen them. Today, we remember an older generation who secured peace in Europe. Tomorrow, we will continue to work to ensure peace for the next generation.

Order. Let us stand for the two-minute silence.

Thank you.

I am pleased to bring the important subject of the economic development of the east of England region to the notice of the House. Recent legislation will provide for nine English regions, including the east of England, and 1 shall focus on the six counties that will form the east of England region.

I was surprised, and somewhat perturbed, by recent inquiries from the media and others that suggested that they did not know the boundaries of the region. They did not know how many counties it contained and they were not well advised about the new regional development agencies or the regional chambers that will be established and become effective from next year. They also did not know the overall remit of the regional agencies, stakeholders and chambers. Therefore, I propose to outline that remit and inform the House and the wider public about it.

The east of England region comprises Norfolk, Suffolk, Essex, Cambridgeshire, Hertfordshire and Bedfordshire, including the unitary authorities of Luton, Southend and Thurrock. The importance of regional development should be obvious to everyone, because the regions will be able to do what Whitehall alone cannot. I remember the days of Harold Wilson and the Invest in Britain Bureau, which did a marvellous job. Since then, we have had Scottish and Welsh Development Agencies, which proved very successful. It is time now for regional devolution to the English regions and for the promotion, especially, of the east of England region.

The board of the regional development agency is now being drawn up and the chairman is Vincent Watts. I congratulate him on his appointment and wish him every success in his endeavours. I hope that he is listening to the debate. The chambers are also being formed and they will be the accountable base in the region. I look forward to the time, perhaps in the next Parliament, when we have regional government with a directly elected chamber.

The new policies have some detractors, but I hope that today's debate will reassure them that the policies are right. The need for a strategic investment and overview, with counties and stakeholders working together for the greater benefit of the entire region, is something no one can deny. The new RDA has the support of the voluntary sector, the Confederation of British Industry, local government, the training and enterprise councils and a range of other stakeholders. They are happy with the new development and wish to see it go even further, as do I.

The regional boards will bring private sector leadership that will help to drive the regional economy forward. The Regional Development Agencies Act 1998 describes the functions of the regional development agencies. They are:

"to further the economic development and the regeneration of its area … to promote business efficiency, investment and competitiveness … to promote employment … to enhance the development and application of skills relevant to employment in its area … and to contribute to the achievement of sustainable development in the United Kingdom where it is relevant to its area to do so."

That last point should be underlined.

The region of the east of England comes 42nd out of 77 regions in Europe for gross domestic product. Until 1995, it was sixth in the UK—those are the latest statistics that I have found—but I have been told that the situation has improved since then and the region may now lie third. The region is diverse. To the north, it has food processing and huge agricultural interests. Research and development activity is above average, and includes a pharmaceuticals base. It has a defence industry, including firms such as GEC Marconi, which has been a significant influence. Research and development takes place at Ford's huge plant at Dunton near Basildon. A wonderful skills and technology transfer is about to happen, and I welcome the recent developments in that respect in some of our more notable university towns. More needs to be done.

The Cambridge area is one of the region's drivers for science and technology. 1 hesitate to step on the toes of another hon. Member. so I will not to go into too much detail, but I want to describe some of the things that are happening and that need to happen. We face real challenges in respect of our evident weaknesses.

Will my hon. Friend give way?

Briefly, but I encourage my hon. Friend to make her speech later. If she—

Order. [Interruption.] Order. The hon. Lady must take her seat when the occupant of the Chair stands. Hon. Members who are speaking should give way or decline interventions immediately not have a mini-debate on the subject.

rose—

Order. Mrs. Christine Butler.

I give way to my hon. Friend.

I am most grateful to my hon. Friend. I do not wish to interrupt the flow of her remarkable speech. The growth of high-technology industry in Cambridge and south Cambridgeshire can be an important driver for the region, but it is important to get the infrastructure needed to allow the diffusion of high-tech industry. I hope that we agree that some parts of our region badly need development but are prevented from getting it because high-tech industry is concentrated into a small, congested area around Cambridge.

My hon. Friend is right. Our region is diverse and has disparities within it. Some areas are performing well, some not so well. In general, the better-performing areas are central and the less-well-performing areas are the peripheral and coastal areas and those nearer London. They have problems. In some cases, transportation links are weak. We need increased investment in public transport to supply the rural hinterland around Norwich and Cambridge, and towards the coast, as well as seeking regeneration in the south.

In south Essex, our old infrastructure needs to be tackled. It would help if the east Thames gateway were extended as far as Southend, matching the extension that is developing well in Kent on the other side of the river. We are not foolish enough to believe that that would bring enormous grant aid, but it would align us with the rest of the corridor. We would be able to bid into the regeneration and seek improvement in south Essex.

The east of England has a diverse economy with no single predominant industry but it has one of the largest concentrations of new and growing businesses. Within that there are significant geographical concentrations in successful industries such as food processing in the north of the region, pharmaceuticals in the south, and biotechnology in the Cambridge area. However, it must be recognised that the region has areas of economic inactivity and low productivity. Some urban, coastal and rural communities have suffered from adverse market changes and deprivation, with low earnings and household income depressing local spending.

The Government offices for the regions have been tasked by the Government to produce a strategy. I have the "East of England Competitiveness Strategy 1998–2008", and I was pleased to see it. Hard work has gone into it and I congratulate the Government office that produced it on its stalwart efforts in getting it in before time. It is a good programme. The background information notes that gross domestic product per capita in the east of England is 92 per cent. of the European average, placing it 42nd of the 77 European regions.

I am grateful to the hon. Lady for her courtesy in giving way. Does she agree that the document to which she referred is not yet the strategy of the regional development agency, which is not due till next October? Can she venture a project that is to be undertaken by the RDA that would add value to existing activities in the eastern region?

I note what the hon. Gentleman says, but he is saying it to trip me up. I was hoping for a constructive debate. We are present at the imminent birth of something. I am trying to describe the work and research that has gone into what needs to be done and the methods for doing it. It is all very well for the hon. Gentleman to shake his head and smile. I note that his party is not enamoured of the strategic approach that can be gained through regions. I think that he is wrong.

Does my hon. Friend agree that there has been increased inward investment in the region as a direct result of the establishment of the RDA?

My hon. Friend is right, but effective implementation, with the boards and chambers up and running, has not yet happened. It is being readied, but already the interest and the work that has been going on have encouraged investment. Improvements have been made already. I do not have the information with me for the enlightenment of the hon. Member for South Cambridgeshire (Mr. Lansley), but I have read of areas where inward investment has occurred because of that approach.

The aim of the strategy is that, in 10 years, the east of England should be one of the 30 most prosperous regions in Europe. Considerable benchmarking has been going on. The objectives are outlined as follows:

"Improving the Performance of Existing Businesses

Attracting and Creating more Businesses

Developing a World Class Workforce

Developing a More Effective Communications Infrastructure

Helping Business to Meet Regulatory Requirements

Economic Development to be Environmentally and Socially Sustainable."

For the next steps for each objective, the competitiveness strategy identifies the key actions that the east of England needs to take. On

"Improving the Performance of Existing Businesses",

it identifies:

"Promoting Benchmarking

Encouraging Innovation

Preparing for EMU

Developing Expertise in Business Support

Improving Management Training."

It is not a moment too soon. There is a productivity deficit not only in the east of England, but in the entire United Kingdom. By saying that I do not mean to take a shot at the work force—an interpretation that Opposition Members have previously tried to promote, which is dishonourable of them—but to urge improvement of management skills and procedures, and an increase in investment.

To attract and create more businesses, we need to increase inward investment. We need to strengthen support for start-ups, identify sectors for support and arrange local clusters surrounding a dominant industry, whose core needs can be met through a mutual approach to the product of the main business. The hon. Member for West Chelmsford (Mr. Burns) looks puzzled: I am willing to give way if he wants to ask a question.

We need to develop a world-class work force by defining skills needs. That problem requires attention. I have attended several regional forums in which businesses say that, although they have job vacancies, the work force lack the fully developed skills needed to meet the demands of the local labour market.

I am extremely grateful to the hon. Lady for inviting me to intervene. She has raised the importance of encouraging business start-ups. As a fellow Essex Member of Parliament, will she tell the House what she thinks has been the significance of the AMT—the regional centre for the advancement of manufacturing and technology—in Essex?

I was a member of Essex county council when the decisions on that and the Konver programmes were being considered. In truth, to judge the benefit of the AMT is not an easy task.

Why not?

I shall continue with my speech, because other hon. Members want to make a contribution.

We have skills deficits in certain areas and I urge my hon. Friend the Minister to do what he can to help address those problems. I suggest that what is needed is closer co-operation between further and higher education, as people in certain parts of the region lack ready access to higher education. I congratulate some local institutions that are franchising with further education and thereby enabling students to undertake higher education courses locally. Anglia polytechnic university, which is an example of a good regional university that is vocationally oriented, offers a model which others might do well to emulate.

It would be wrong to talk about what business can do without addressing what others can do. Two planning conferences—Serplan, the south-east regional planning conference, and SCEALA, the Standing Conference of East Anglian Local Authorities—meet and their remit is wider than the eastern region. I hope that, in future, there will be one planning conference that covers the eastern region as a whole, as that would be helpful.

I congratulate my hon. Friend the Minister on the marvellous work he has done so far. It is his stated opinion that, within the current proposals and policies and the legislation that is soon to be enacted, there is a promise of evolution. I am pleased about that, but I should like that evolution to develop as fast as possible. Much will depend on the performance of the RDAs and the regional chambers.

I want the funding regime for the RDA to be more generous. I acknowledge the money coming from English Partnerships and the Rural Development Commission and the valuable work of the Government office for the eastern region, but I also want the training and enterprise council budget eventually to go to the RDA, and the TEC and other bodies to have to put in value-added bids. That would be a good way to ensure that the dynamism behind the economic regeneration and future development of the area rests with the RDA; thus, the RDA will be seen as important and powerful, which will attract the right players to it.

I should not like to finish without mentioning transport. If we are not careful, we will bid for too many roads, which would not fit in with the integrated transport White Paper. Instead, we need to reduce the need to travel. Our efforts might take the form of a regional planning guidance note 13, which would try to drive planning towards having transportation corridors, with areas of employment and housing more closely integrated, thereby obviating the need to travel long distances to work. That trend is stronger in our region than anywhere else. Such policy must be developed for the long term because planning takes time and the implementation of plans takes even longer, but we have to start some time and now is as good a time as any.

Given the eastern region's wonderful geographical position within the United Kingdom and Europe, concomitant with proposals for economic development and regeneration in the eastern region must be planning policies that promote sustainability. Those policies must guide the new boards in their promotion of the region for inward investment and relocation of businesses.

Business can help when there is no requirement for workers to be based at a specific site: for example, call centres do not need to be near an airport—they can be located anywhere. Improvements in communication technology will mean that many more businesses are free to relocate. What is needed is the right sort of support for businesses, so that those things can happen and happen more speedily.

I hope that my introduction and broad-brush description of our region—its best points and its inherent weaknesses—will generate further discussion. I shall enjoy listening to other hon. Members making their contribution this morning. Now that we are about to establish a real identity for the east of England, I hope that stakeholders outside the Chamber will add their voice to the general debate, which I am sure will encourage partnership working in the years to come.

I congratulate the hon. Member for Castle Point (Mrs. Butler) on securing this important debate for the eastern region, which, as she said, comprises the six counties of Essex, Suffolk, Norfolk, Cambridgeshire, Bedfordshire and Hertfordshire. They have a combined population of 5 million and the region is therefore bigger than many countries. I do not, however, advocate independence from the United Kingdom. I seek fairness from the Government and the European Union.

The eastern region is the fastest growing in Britain. Not for nothing is it known in government speak as GOER—the Government office for the eastern region. We are all goers in the eastern counties. Between 1981 and 1991, the region's population grew by 6.1 per cent., and an even faster increase of 6.4 per cent. is forecast by 2000, compared with 3.2 per cent. for the country.

With an area of 7,380 square miles or 19,117 square kilometres, the eastern region represents almost 8 per cent. of UK land area. The population is just under 10 per cent. of the UK total. The region, as has been pointed out, is diverse and stretches from the Wash to the Thames, skirting the suburban fringe of Greater London and embracing the finest agricultural land in Britain.

Industrial and commercial centres are located throughout the six counties. New and historic towns and cities are surrounded in most instances by extensive rural areas, which give the eastern region its distinctive urban-rural mix. The coastline is one of the longest in the country, with major seaports and other maritime interests to be found along it. London's developing third airport is at Stansted. The region has six universities—including the University of Essex, which is Britain's most international university—and one of Britain's largest garrison towns. It has a wide range of industrial and manufacturing industries, one of which, I am pleased to say, has been voted Britain's exporter of the year—Woods Air Movement in my constituency.

Although the region is generally prosperous, there are pockets of serious economic and social deprivation, particularly in areas affected by the decline of traditional industries such as agriculture, fishing and defence, as well as the decline of seaside resorts. Its population, gross domestic product and number of businesses represent around 10 per cent. of UK totals, which makes it easy to relate to national statistics.

Unemployment in September was 3.3 per cent. compared with a UK average of 4.6 per cent. That will be of little comfort to my constituents who were told yesterday that the long-established printing firm of Spottiswoode Ballantyne is to shut with the loss of 140 jobs, along with around 90 jobs being lost at the sister company of Cowells in Ipswich. Also, yesterday, 30 workers at Albany Laundry in Colchester heard that they were to be made redundant, news which follows confirmation of the loss of 60 jobs at the hospital laundry in the town.

While the regional unemployment average is below the national figure, the picture is not even. In Clacton, Harwich, Great Yarmouth and Lowestoft, for example, unemployment is more than double the regional average.

The eastern region needs to draw on its strengths to overcome its weaknesses. I shall leave it to others to concentrate on the problems of agriculture, which remains a dominant feature of the region's prosperity.

The need to improve the transport infrastructure is particularly important. I hope that the Government will push forward with all speed the development of the Eurorail connection at Stratford in east London. The road link between Ipswich and Norwich needs to be upgraded. The Minister's assurance today on those matters would be appreciated.

It is vital that we spread new development more evenly. Some areas are experiencing pressures of growth while others witness decline and deprivation. That balance must take account of the need to retain the best of the region's distinctive qualities: our attractive natural and built environment. We have a diverse economy, and we must maintain that. We have an adaptable work force with good industrial relations.

The eastern region, however, is 42nd out of the 77 regions in the European Union Economic League. We have the potential to make it one of the most prosperous in Europe, as set out in the "East of England Competitiveness Strategy 1998–2008", the launch of which I attended in the summer.

Today's debate provides an opportunity for the 56 Members of Parliament for the eastern region to highlight all that is good in our part of the UK. We look to the Government to treat us fairly and ask for nothing less than an eastern promise.

I, too, congratulate my hon. Friend the Member for Castle Point (Mrs. Butler) on securing this debate, which the Commons Library informs me is the first debate on economic development in the east of England for at least 20 years. That is, perhaps, an interesting comment on the previous Parliament.

I stress the importance of recognising the east of England as a region and ensuring that the region recognises itself. That is not an easy task because, when one leaves the traditional counties of East Anglia and reaches the south-western and western parts of the region, one finds that people do not have a strong regional identity. In Bedford and Kempston, for example, the connections to the west—to Milton Keynes and Northampton—are at least as strong as those to Cambridge in the east. None of those connections is as strong as those to the south—to London.

If we were to adopt a laissez-faire attitude, London would become the regional capital of everywhere that looks to it for one function or another. That region would be huge, disparate and over-dominated by London. It would be difficult for any activity to take place in most parts of the region because people would live there and travel to and from London. There would be suburban deserts with over-congested transport links into and out of the metropolitan centre. That would be the result of bad planning or, more likely, an abdication of planning, leading to economic under-performance and a denial of opportunity for hundreds of thousands of people whose quality of life would be impaired. In some ways, that is exactly what has happened in past decades. We need, and there is a consensus for, economically dynamic communities across the country, not only in big cities but in towns and villages that have a lot to offer in their own right. We need communities that offer a balance of jobs and social, leisure and educational opportunities. We need communities that enjoy civic pride and care about their area. One of the necessary ingredients for achieving that are strong regions, which offer valuable qualities different from those in London or any other big city.

Today, we have the opportunity to drive forward that process because we have a Government who understand the importance of regional development and who will soon speed up that process through the introduction of regional development agencies.

A strong eastern region will not weaken the special role of London or devalue contacts with any other town or region. It will strengthen those contacts and the country as a whole. We have to make the eastern region work. Much needs to be said about that, but there is not much time for me to elaborate, and I hope that other hon. Members will contribute.

I shall touch on two strategic issues, transport and relative deprivation. The existing transport network illustrates my point. Bedfordshire, for example, is one of the fastest-growing areas of the country in residential development and population growth, yet that has not been matched over the years by investment in the economy, in jobs and in the transport infrastructure. Unbalanced planning has resulted in some of the most heavily congested roads in the east of England, particularly the Al and M1, which are, of course, north-south links.

I am convinced that there are great opportunities along an east-west axis. The eastern region will not prosper unless east-west links are considerably improved. One of the best ways of boosting the eastern region, including my constituency, Bedford, and Kempston, would be to deliver an east-west rail link.

A consortium of local authorities and Railtrack has been working on that project for some years. It is an imaginative proposal for a new rail route running from Ipswich to Cambridge, and then through Bedford, Milton Keynes, Oxford and Swindon, connecting finally to Bristol, with all the important junctions north to south with which that line would connect. It is a fantastic idea.

I understand that a revised business case is being prepared and will be submitted to the Government later this autumn. I hope that it will be sympathetically received, and that Ministers are in no doubt about my support for the concept and for the preferred route through Bedford. In the context of an integrated transport policy and the need to promote environmental sustainability, I hope that an east-west rail link will become attractive for freight as well as for passenger movements.

The second topic that I shall mention briefly, deprivation, is essentially a matter of perception and recognition. The absence of a clear voice for the eastern counties over many years may have assisted in the development of a view in Whitehall and Government circles that there are few problems in the east of England. The impression has been one of general affluence. There are indeed comfortable villages, towns and suburbs, but there are also pockets of deprivation in both town and country, which are not always recognised by Government statistics.

The index of local deprivation, for example, focuses on whole council areas. Bedford borough ranks 218 out of 354 local authority areas in England in the 1998 index of local deprivation, yet three wards in Bedford rank in the top 10 per cent. of the most deprived wards in England. If one adds deprivation in other wards in Bedford and Kempston, about 30,000 people out of 92,000 in the constituency live in such areas—quite a large pocket. That is not the picture usually associated with Bedford and Kempston or with the eastern region.

I do not wish to detract from efforts to tackle deprivation, social exclusion, unemployment and under-performance in any other part of the country. The Government exist for the many, not just for the few. Therefore, every community deserves recognition, and the needs of every community must be measured more accurately. I ask my hon. Friend the Minister to recognise that there are pressing needs in Bedford and Kempston and in the east of England. I am sure that, in the months and years ahead, he will hear more, not less, from me and my hon. Friends about the needs of the east of England.

I, too, am pleased that my hon. Friend the Member for Castle Point (Mrs. Butler) secured the debate, and that she spent so much time outlining the region in general, as that allows me to concentrate on my part of it.

For someone born in East Anglia and who represents an East Anglian constituency, it has not been easy to come to terms with the boundaries of the eastern region. Many people in my constituency find it hard to comprehend what Lowestoft has in common with Watford, so it is not surprising that the eastern region has yet to develop its identity fully. Like other Members of Parliament and like business and community leaders in my constituency, I believe that we must make the best of what we have—hence, my support for the debate, to help to establish the identity of the eastern region in the House and further afield.

I strongly support a regional dimension to politics and government. That is important for the devolution of over-centralised power in this country, and in order to answer the West Lothian question and to position ourselves effectively in Europe, something that our region has not done in the past but is now beginning to do. There is strong support from business in my constituency for the new regional development agency, and we have high hopes of its tackling the problems in our part of the region.

As has been said, the outstanding features of the eastern region's economy are its diversity and disparities. It is generally seen as a prosperous region, but there are unemployment black spots. Lowestoft in my constituency, and the neighbouring town of Great Yarmouth, have suffered and continue to suffer, perhaps more than any other towns. We have long had the highest unemployment figures in the region. They move up and down, but they are always at least twice the regional average and three times the rate in the areas with the best figures. Unemployment is accompanied by low pay, deprivation, poor health and higher crime. People in my constituency ask, "Why us? Why must we suffer?" They are loyal and hard working, there are good industrial relations and low labour costs, plenty of cheap industrial land is available, and the area is a nice place to live. Lowestoft officially has the best beach in England and we have the Broads national park—a pleasant environment.

However, for the past 15 years, people in my area have suffered unacceptable employment levels and a depressed economy. It is important to analyse the reasons for that decline. We have lost our traditional industries and therefore thousands of jobs. In Lowestoft, we have lost two shipyards and two food canning factories. Many hon. Members will remember the old Co-op brand name Waveney, which gave its name to my constituency. It exists no longer. The Eastern Coach Works was once the largest employer, but that has gone too, as has a shoe factory. Hon. Members will be familiar with the decline in fishing. Once, one could walk right across Lowestoft harbour on the boats lined up next to one another. Now we have just 10 trawlers and 30 smaller inshore vessels. Our inner harbour area contains acres of dereliction, with factories empty or razed to the ground.

We have benefited to some extent from the cushion provided by the offshore oil and gas industry, but jobs there are being reduced. We have had the cost reduction initiative for the new era—CRINE—and unfortunately 140 jobs were lost at Shell's Lowestoft base two weeks ago.

Our part of the region has not succeeded in attracting new industries on a significant scale. Why? I am pleased that other hon. Members have drawn attention to the poor transport links. East Anglia is usually not seen as a peninsula because of its rounded shape, but if one drew a map showing travelling time rather than travelling distance, the peninsula would be greatly extended, possibly right across the North sea.

People in my area were disappointed by the roads review. We feel that we are condemned to continue with roads no better than winding country lanes, clogged up with tractors and with trucks passing through villages— which neither the truck drivers want to do, nor the villagers want to suffer. Our regional newspaper, the Eastern Daily Press, refers to life in the "slow lane". Our branch line railways are no better: it can take longer to travel by rail than by road. That affects business competitiveness in our area. I hope that the forthcoming competitiveness White Paper will recognise the degree to which transport costs and travelling time affect competition.

Transport accounts for a significant proportion of business costs. It is an instrument and an engine of economic development—not just an environmental inconvenience. Ironically, Lowestoft exists because it is a port—in fact, it is the country's most easterly port and has enormous potential as it points straight at Europe. There is container business at the port, which also handles grain imports and exports. Although a port integrates sea and land transport, it cannot operate successfully unless the land transport is adequate. We look forward to improvements in our road and rail transport. East-west links are important, but with only one such link, along the A14 corridor, the northern and eastern parts of the region would be further marginalised.

In order to attract new business, we must offer companies some incentive to relocate to our part of the region. Lowestoft does not have assisted area status and, without it, it is difficult for the council to summon the resources to provide a reason for companies to relocate there. As a former council leader, I dealt with companies that were seriously interested in relocating to the area. However, because we could offer them no real incentive to do so, they often went somewhere else.

It is a travesty of justice that, under the previous Government, Lowestoft did not receive assisted area status—although it was granted to Great Yarmouth. The previous Government realised their mistake and cobbled together some European structural funds, to the extent that Lowestoft was redefined as a rural area and received objective 5b funding. In terms of regional strategy, anyone can see that Lowestoft and Great Yarmouth must be considered together. The answer is to give them both assisted area status and European structural funds, so that the areas that have suffered for so long can be regenerated properly. My hon. Friend the Member for Great Yarmouth (Mr. Wright) would have said the same thing today had he not been attending to other duties in his constituency.

We need a sub-regional strategy for the north and the east of our region, which suffer the most economic deprivation. There is a deeply held feeling that the previous Government severely neglected our area. When one lives on the coast—out on a limb—one is always anxious lest one be forgotten. This Government must not make the same mistake as the previous Government. The regional development agency must recognise our area as a priority and support us with financial measures. If the Government ensure that outcome, they will retain the confidence of people in my local area.

I draw hon. Members' attention to my registered interest with Roche, a pharmaceutical company in my constituency. It gives me great pleasure to contribute to this debate, and I congratulate my hon. Friend the Member for Castle Point (Mrs. Butler) on her success in securing it. Regional development agencies herald the advent of a new era in this country and propose a new identity for the eastern region. They are extremely welcome.

I hope that hon. Members from all political parties will fight with equal vigour and enthusiasm on behalf of the eastern region and its new identity. The hon. Member for Colchester (Mr. Russell) nods his head. I congratulate him on his 100 per cent. support for the region. I also congratulate my hon. Friends on their enthusiastic support for the debate. However, I am disappointed to see only two Conservative Members in the Chamber—although almost twice as many Conservative Members as Labour Members represent the region. I am sorry that the Opposition have not made a positive contribution to the debate, and I hope that hon. Members from both sides of the Chamber will make such a contribution in future.

The eastern region comprises examples of the United Kingdom's strengths and many of its weaknesses. I believe that problems, and many answers, can be found in the region.

rose

I will not give way as there is not sufficient time. Hertfordshire, where my constituency is located, is an area of skills and relative affluence. It is important to stress the word "relative", because I shall touch on some points raised by other hon. Members this morning—particularly the two previous contributions. Unemployment in Hertfordshire is at its lowest since 1991, and owner-occupation in Hertfordshire is well above the national and regional averages. One factor contributing to that result is the strength of the pharmaceutical base in the region.

More than 2,000 companies undertake pharmaceutical research and development, and a slightly greater number are involved in manufacturing and production. An estimated £900 million was spent on research and development in 1997, and 1996 figures for the region place the value of industry exports at more than £1.6 billion. Interestingly, the region's pharmaceutical industry contributes to the economy by generating an extra gross domestic product of £2 billion a year.

The pharmaceutical industry and other industries are attracted to the area—there are four very active pharmaceutical companies in my constituency—by our highly skilled work force. Some 80 per cent. of the population in Hertfordshire are classified in social groups 1, 2 or 3. Hon. Members can see that industry is drawing on a highly skilled base, which I know that the Government want to see replicated elsewhere in the region and the country. We must increase the skills base and thus boost the economic returns of industry.

However, those statistics and other indices often conceal inequalities. My hon. Friends the Members for Bedford (Mr. Hall) and for Waveney (Mr. Blizzard) spoke eloquently about the way in which those indices disguise the poverty in their constituencies. The situation in my constituency is no different. One in 10 of Hertfordshire's electoral wards has been assessed, on the basis of wide-ranging factors, as being more deprived than the United Kingdom national average. There are 19 deprived wards in Hertfordshire, and areas of concern include unemployment and poor housing conditions. We must take those factors into account when compiling a picture of the region's needs and we must combat those pockets of deprivation while building on the region's economic strengths.

We must recognise, too, the region's diversity—although, sad to say, the region has lost much of that. The once large British Aerospace presence in my constituency is now a vacant site. That traditional industry employed thousands of people in my constituency but it was decimated in the late 1980s and early 1990s, and its 896-acre site is now scheduled for development. That site could be used for housing, to create employment or for university use. We must encourage those sorts of interests in the region on a large scale.

The Minister will not be surprised if I turn to another theme common to those sketched by earlier contributors to the debate. Development of the site—I hope that it will commence within a year or so—is dependent upon improved east-west communications. The site cannot be developed without substantial support for local public transport and better east-west communications. The county council in Hertfordshire, and my colleagues there and in neighbouring counties, are keen to see the central Herts passenger transport scheme receive active support from the Government. That scheme is vital if we are to ensure that major sites such as this are developed and the local and national economies strengthened as a result. We need the link through Watford, St. Albans and through Welwyn Hatfield on towards the east to ensure that massive developments on hundreds of acres, involving housing and nearly 50 hectares for employment, can get under way.

We need to be sure that we have a new deal that will take account of the ambiguities and diversity of the eastern region. My hon. Friend the Minister has heard the good news and the bad this morning. He has heard about the areas where we are strong and the things that we need to tackle. We welcome the Government's approach. Their collaborative approach recognises that all the counties in the region and Hertfordshire can be a model for other areas to emulate, given the way they work together, and the way in which these issues can be dealt with. However, it needs to be recognised that affluence is still to be found alongside pockets of poverty.

I hope that transport will be recognised as one of the key factors. We have the tools to do much of the job ourselves, but we need a transport infrastructure and an integrated transport system that will ensure that progress is made.

It is good to know that Opposition Members who have not contributed to the debate have remained silent to allow Labour Members to speak for longer. I thank the hon. Member for South Cambridgeshire (Mr. Lansley) particularly and his Opposition Front-Bench colleague, the hon. Member for West Chelmsford (Mr. Burns), for their generosity in that regard. However, I hope that the Opposition will be better represented in fighting the case for an exciting region that has a whole lot going for it. My colleagues and I think that it has a bright and promising future, with the Government's full support.

The contributions of my hon. Friends have emphasised the diversity of need within the region. In looking to economic development, we need to recognise that a priority is to protect what we have as well as considering the new that we need to develop.

It would be remiss in a debate on the region, which includes some of the best agricultural land in the country, not to make some reference to the needs of farming. The House has spent some time on the issue in recent weeks and I do not need to rehearse the many difficulties that the farming community faces. In the part of Norfolk that I represent, which was at the heart of the agriculture revolution, the main farming interests remain arable. Therefore, we have not suffered to the same extent as the livestock and dairy industries. However, there is no area of farming in recent times that has completely escaped difficulty.

I have been reminded regularly by the farming community—most recently at a meeting with Tom Pexton, the deputy president of the National Farmers Union, Nick Velsboer, the local chairman, and others—of the wide range of problems that it faces. I am confident, following the debate on farming last week, that my right hon. Friend the Minister of Agriculture, Fisheries and Food is aware of the difficulties and is arguing the case in the Cabinet for a set of measures to tackle the immediate issues. Yes, we need urgent action; but I tell the Government that that action needs to be part of a coherent package. It is important that we use extra money to modernise and adapt farming to the needs of the next millennium rather than to postpone problems. We need to address Agenda 2000 and tackle the greater world trade problems that I believe will face farming. I was extremely pleased, at the meeting with the NFU, to hear that local farmers, while in anguish about their problems, recognise that the Government's role is to help them address the future of agriculture.

Agriculture is three and a half times more important in my constituency than the national average. The devastation of the work available in agriculture since the second world war means that it now represents only about 5 per cent. of the economy in my constituency. Those who would see Norfolk as a place for the landed gentry and for tourism may not recognise that 95 per cent. of those who live in the county are dependent on work in industry, commerce and the service industries. That is much the same as elsewhere. When taking averages over large swathes of countryside it is easy not to appreciate that some of the wards in my constituency face needs and problems as great as those anywhere in the land. I hope that the Government, through the regional mechanism, will ensure that pockets of deprivation which seem small when averaged out but which locally are extremely important to those who have to face them, are tackled.

Our needs for industry have in recent times shared much in common with the needs of the rest of the country. I regret to say that, only this morning, the financial press is reporting that the important local company Porvair, which is at the forefront of the manufacture of microporous materials and which exports 80 per cent. of what it produces out of King's Lynn, is facing a 14 per cent. reduction in the work force because of the problems that it has experienced in world markets-owing to the high value of the pound and high interest rates. However, the picture is not all gloom and John Morgan, the chairman of Porvair, believes that the company can adjust, improve productivity, face new challenges and move forward. The same applies to most of the industry in my constituency.

The specific problems that we face in the region have already been mentioned. I challenge any Minister or shadow Minister to take the A47—a recognised trans-European road from Peterborough, through Thorney to Wisbech on the way to King's Lynn—and to feel that it does not need improvement. I accept that, nationally, the balance may have been badly struck between the need to meet traffic demand and the need to have measures to reduce traffic. However, no one can come to northern East Anglia without recognising the need not only for more than one east-west link along the A14 but for dramatic improvements and a dramatic change to Governments' attitudes of the past 20 years.

Last week, during the debate on agriculture, the right hon. Member for South Norfolk (Mr. MacGregor) referred to the Government's being inactive while Rome burned. The question that the Opposition need to address in terms of agriculture and the countryside is: who lit the fires that are burning? Our inheritance of problems in the region reflects decades of neglect of infrastructure. It is extremely difficult to entice investment to one's region to provide jobs for the future and to protect the jobs that are already there unless the Government recognise the needs of those who have never been served by decent roads.

The need for improved roads must be firmly grasped, while the Government must recognise the need in the urban environment to encourage less use of the motor car. I hope that the Government will recognise also—I was among the first to welcome the investment in rural transport provision in the Budget—that we shall never be in a position in rural areas to reduce people's need for the car to get to work and get about generally. That is why we have a high percentage of car ownership in my constituency; it is not because people are wealthy, but because there is no alternative. When we count the number of buses by the week, the exhortation to get on the bus by driving up petrol prices, with no counterbalancing action from the Government, is just not fair to my constituents.

I am sure that the regional development agency and regional government will be important ways forward because, by co-operating within our regions, we can achieve more than by bickering about what goes where. I hope that we will come to sensible compromises on where offices will be located and on priorities to ensure that we do not neglect the minority simply because of the constant need to address the needs of the majority in the region.

I add my congratulations to the hon. Member for Castle Point (Mrs. Butler) on securing this debate, which is extremely important for all of us who have constituencies in the eastern region. How refreshing it is to have had an intelligent debate divorced of the normal party political bickering that, all too often, blights discussions in this Chamber.

I begin by concentrating my remarks primarily on my county of Essex, which, in many ways, is the gateway not only to East Anglia, but to the eastern region. In the southern part of the eastern region, we are fortunate to have a work force that, as one hon. Member has mentioned, is good, well skilled in many sectors and has excellent industrial relations; so it is an area that is attractive for employment and employees, even if we do not enjoy the status in relation to assistance and regional aid that other parts of the country have.

We have a good communications network. That is not exclusive to the whole region, as we have heard from a number of hon. Members.

Does the hon. Gentleman agree that one of the great constraints on development in the eastern region is the mess that his Government left behind by eroding public transport, which makes it impossible to get from one side of the region to the other?

When I allowed that intervention, I feared that we were going to get something that was slightly out of sync with the rest of the debate—and my fears were fully justified. I do not share that poisoned and poisonous view.

In the southern part of the region, we are fortunate in that we have a good transport communications network: the M25, the M11, the A12 and the improvements that, I hope, the Minister's Department will approve shortly to the A130. We have an improving rail network. About 7,000 of my constituents commute every day to London to work. Improvements in signalling, points and rolling stock over the past decade have greatly enhanced rail transport from mid-Essex.

That does not mean to say, as many hon. Members have pointed out, that no further improvements have to be made. Improvements must be made on the Al2 from the M25 to the ports of Harwich and Felixstowe. It is an important feeder road to those ports and beyond. As the hon. Member for Waveney (Mr. Blizzard) said, the roads in Norfolk, although improving in certain areas, leave much scope for improvement.

As a number of hon. Members have said, we need improvements in the infrastructure of the railways. There has been talk of an east-west route from Ipswich through Welwyn Hatfield, Bedford, for which a bid was placed, Milton Keynes and towards Bristol. Given our closer economic and business development ties with Europe and the enhancement of the ports on the eastern seaboard, we need—this is overdue—improvements in that transportation to enhance the general economic well-being and attractiveness of the region, so that we can attract more businesses to it.

We have excellent academic facilities in the region. My own university, the Anglia Polytechnic university, is first rate. The university of Essex, the university of East Anglia in Norwich and, of course, the university of Cambridge in the constituency of the hon. Member for Cambridge (Mrs. Campbell) are vital in developing links.

The university of Hertfordshire.

We have another bid—the university of Hertfordshire. Those universities are important centres of excellence for working and developing links—in both training and product research and development—with local industries. More work must be done to build on the successes.

Will the hon. Gentleman give way?

I will not, if the hon. Gentleman will forgive me, because I have only five minutes. I do not want to eat into the Minister's time.

There is a problem in my county, not exclusively in my constituency, because it also affects the constituency of the hon. Member for Basildon (Angela Smith) and, I suspect, the Colchester area as well. Essex towns such as Chelmsford, Colchester and Basildon have a manufacturing base that one does not naturally associate with the leafy green suburbs of the home counties; the size of that manufacturing base has perhaps been unusual.

We are proud of that tradition, but many of those manufacturing companies are defence-related industries. In the past eight years in particular, with the ending of the cold war, the worldwide recession of the early 1990s and a greatly increased competitive world market, pressures have been exerted on companies to compete in those markets and to win contracts. We have paid a high price for the peace dividend, with significant redundancies being made in those defence-related industries.

Those companies have had the foresight to diversify, to protect and, in many ways, to expand their core base, but we have had to pay a price. We have been fortunate. I pay tribute here to Essex county council, under the control of all three main political parties over the past eight years, to the previous Government through the Department of Trade and Industry, and to this Government for the way in which they worked with the European Union to designate Essex an area that qualified for Konver funding, in relation to both Konver 1 and 2. That led to developments such as the advanced manufacturing centre in Chelmsford.

The centre has done critical and crucial work to help defence-related industry employees who have been made redundant to reskill and to retrain, and to give them the opportunity to use their skills and expertise to help to build small businesses. That is an important way forward, which puts back some of the goodness that has been taken away with the redundancies in the local economy; it starts off the small businesses of today that, I hope, will be the medium businesses of tomorrow and the larger employers of the future.

That is the way in which I would like further development to enhance the local manufacturing base. We do not want a constant erosion of that base to the point where a local community's employment base has been shifted significantly from a mix of services and manufacturing to services alone.

Not only in Essex, but throughout the region, we have to ensure that we promote ourselves as an area that is vibrant—that has much to offer both in its living environment and cultural events—so that people want to relocate there. More often than not, for financial reasons, companies will locate in areas where there are substantial Government grants through regional aid.

The east of England is a success story; it has a vibrant community. We must build on the work of many local authorities and other organisations and sell the region to ensure that we get our fair share of inward investment. We do not want to lose any more industries. Over the past 20 years, many have moved to other parts of the country because of financial benefits and local tax breaks.

I do not share the enthusiasm of the hon. Member for Castle Point for regional development agencies, although we will have to await the establishment of our RDA next year to see whether it produces any concrete achievements. I disagree with her views on regional government —it would be another layer of pure bureaucracy, which would stifle rather than enhance the enterprise and initiative of business and commerce. I suspect that she and I will never agree on that matter.

I again thank the hon. Lady for giving us the opportunity to debate this important subject. I shall now sit down so that the Minister has a reasonable time to respond to the debate.

I congratulate my hon. Friend the Member for Castle Point (Mrs. Butler) on securing the debate. I am delighted that she has chosen this subject. The contributions from the Labour Benches have been very thoughtful and have done credit to the region. I do not want to introduce a sour note to the debate, but Labour has 22 Members representing the region and the Opposition 33 Members, yet not one Conservative Member has participated in the debate—other than the Front-Bench spokesman, the hon. Member for West Chelmsford (Mr. Burns). They do not take the future of their region as seriously as do Labour Members—and, indeed, the hon. Member for Colchester (Mr. Russell), 100 per cent. of the Liberal Democrat representation in the region. Before the general election, Labour had four seats in the region; it now has 22. No doubt we will have even more after the next general election.

As my hon. Friend the Member for Castle Point rightly pointed out, the east of England is seen as a relatively prosperous region making a significant contribution to the United Kingdom economy. However, there is great concern that the region is not performing to its full potential—a point made by the hon. Member for West Chelmsford. If we take gross domestic product per head as a measure of performance, the region lies only 42nd out of 77 European regions. That is a legacy that the previous Government left us and we are determined to put it right.

In fact, if the London effect is stripped out, the region is below average in prosperity relative to the UK. On a workplace basis, GDP figures put the region after London, the south-east, Scotland, the south-west and the east midlands and only just ahead of the north-west. On a residence basis, which allows for the income brought into the region by commuters to London, the region is above the UK average with an index score of 109, behind only London and the south-east. However, on both measures, the relative score of the region has been on a downward trend over the past five years.

The region is highly varied. It incorporates the northern fringe of Greater London, medium industrial and commercial centres, and ports and seaside resorts, which have been described in the debate. It has no major conurbations, but a variety of new and historic towns and cities and extensive rural areas. It has areas of prosperity and growth, but also areas of real deprivation. It combines traditional manufacturing and agricultural industries with leading-edge technology and knowledge-based industry. Expenditure on research and development is 3.5 per cent. of GDP—the highest of any UK region.

However, the region is vulnerable and, as has been described in the debate, unfortunately there have been some job losses recently. That said, over the past 18 months there have been major new investments and real growth in the region, especially in retail, computing and financial services. Overall, employment is still increasing and the unemployment rate continues to decrease, remaining below the national average in every county in the region.

As has been said many times, the east of England is a relatively new region. It brings together East Anglia with the home counties of Bedfordshire, Essex and Hertfordshire. The region is, of course, still building its identity. I am greatly encouraged by the activity of partnership groups in the region, which have worked together in recent months to ensure that the East of England regional development agency—to be known as the EEDA—gets off to the best possible start. Local groups are working together to develop and implement regional strategies in key areas such as competitiveness and skills. All that activity has made a real contribution to partnership working in the region across a very wide range of interests, and through that to strengthening the region's identity.

I know from my visits to the region that there is a real enthusiasm in the east of England for the principle of a development agency and for a stake in its activity. That has been shown by the fact that we have received more than 400 high-calibre applications for the 12 seats on the board and almost 100 applications for the post of chief executive. The agency will be able to build on that commitment and activity to develop a fully integrated approach to regional development, both at a strategic level and at the coal face—although for this region it is the high-tech face—where local delivery organisations play such a key role.

A key task of the agency will be to produce a regional strategy to meet its responsibilities, including economic development and regeneration, employment and development skills, and sustainable development. That is in contrast to what was said by the Opposition spokesman, who adequately laid the problems of the region before the House, but not the way to resolve them. We are doing that—

How will the development agency's strategy document interact with the agreement on PPG6 covering Cambridgeshire, Norfolk and Suffolk, as that is to be concluded before the RDA sets out its strategy?

If the hon. Gentleman will bear with me, when I get to the relevant part of my speech I will deal with the plan, which is important.

The EEDA will need to take an integrated approach to producing its strategies and have regard to the needs of the east of England—urban and rural, sub-regional and local. We strongly believe that an integrated and inclusive approach is the best way to improve regional economic performance and to break down what I believe are artificial barriers between the rural and urban areas.

Our aim in the draft guidance on regional strategies has been to provide a steer to RDAs in producing their strategies, without being over-prescriptive and unnecessarily tying their hands. The strategies should not simply restate national policies, but will need to be relevant to the region and address its specific problems and the underlying structural weaknesses in terms of wealth creation.

Land use and transport issues are especially important in the east of England, where a combination of rapid population growth and economic development on the one hand, and rural decline and defence closures on the other, have created conflicting demands and pressures on the infrastructure. Again, that was adequately described in the debate.

I am very pleased that the first of the new public examinations of regional planning guidance will be in the east of England, when the Standing Conference of East Anglian Local Authorities hearing takes place in February. That will be followed in May by the south-east regional planning committee hearing. Those hearings will provide an opportunity for everyone—including hon. Members—to have their say before final decisions are taken. PPG6 will be taken into consideration in the plan as it develops for the eastern region. We are trying to bring together the economic strategic overview for the eastern region with spacial planning and transport planning. We will then have a strategic overview of what is necessary in the eastern region.

The regional planning conferences are also beginning the vital new task of preparing integrated transport strategies, which will link on the one hand with the four-month modal studies that we have announced in the east of England, and on the other with the new integrated local transport plans. After that round is over, we shall begin the process of realigning the regional planning structure to match the new regions. Local authorities in the eastern region are already co-operating across the boundaries of SCEALA and SERPLAN, and RDAs will become another partner working in close co-operation with local government on planning and transport issues as it develops economic strategy. Such partnerships are where the impact on transport in the east-west corridor can be argued out, and they will inform Government policy. It is a bottom-up approach, working in partnership.

I have not been able in this debate to go into too much detail about RDAs. Nevertheless, when they begin functioning next April, they will make a significant difference in regions' ability to plan for the future. The eastern RDA will not only manage change but will develop the eastern region's assets, to ensure that it achieves the status that it wants as one of the best and most productive regions in the European Union. I again thank my hon. Friend the Member for Castle Point for initiating the debate, which has been very useful.

I am most grateful for this timely opportunity to raise an issue of considerable importance to my constituents. That importance was emphasised only a fortnight ago, when I received a letter from the Cambridgeshire and Huntingdon local medical committee, which wished to raise with me precisely the same issues that I shall raise in this debate. I should like first to take this opportunity-my first opportunity-to welcome the Minister to the Dispatch Box. He has onerous and important responsibilities—especially so given the forthcoming social services White Paper. I wish him well in meeting those responsibilities.

I shall do three things in this debate: first, highlight the impact of underprovision of residential care homes in South Cambridgeshire; secondly, demonstrate that, despite the benefit of measures being pursued by the health authority and Cambridgeshire county council social services, an increase in core funding for social services is necessary to prevent deterioration in the position; and, thirdly, draw specific attention to the circumstances arising from the proposed closure of the Red Cross-owned Meadowcroft residential care home in my constituency.

Let me first explain the nature of the problem. In August, and at intermediate times during the summer, Addenbrooke's hospital in my constituency and other local hospitals have been closed to non-emergency admissions. Such summer closures have been unprecedented in recent times. The nature of the problem underlying the closures is demonstrated by the fact that 160 patients –160 beds is almost equivalent to five hospital wards—in the local national health service system have been assessed as no longer requiring hospital care but remain in hospital beds.

About 83 of those hospital patients are awaiting placement in nursing or residential care homes. Additionally, Cambridgeshire county council has told me that 117 people are receiving care packages in the community who should be placed in residential or nursing home places. The council is unable to place those people. I know from personal conversations with some of those involved that some of those waiting in hospital are waiting not only for residential care places but for home adaptations that would allow them to return home.

Why has the problem continued? Additional money has been provided to deal with winter pressures, and I am sure that the Minister will give us further details on proposals for dealing with the coming winter. In the past three years, my health authority has provided Cambridgeshire social services department with £2.3 million to deal with explicit winter pressures. For the winter ahead, the health authority has provided £1.2 million to the social services department, and, because of announcements and allocations made in recent days, even more may be allocated.

The character of the funding provided in winter pressures money does not meet all the problems and, in some respects, may even exacerbate them. Places were purchased after winter pressures money was provided by the health authority to social services last winter, for example, creating a recurrent revenue implication that has to be borne by Cambridgeshire county council social services. This year, the cost is estimated at £400,000, which will have to come out of the money available to social services, thereby reducing its ability to do other things.

At the same time as winter pressures money was being provided through the health authority, Cambridgeshire county council's social services standard spending assessment was cut by £1 million, not in real terms but in cash. The Government are therefore effectively giving with one hand while taking away with the other.

Meanwhile, pressures are increasing. The number of placements to homes is rising and the population of those over 85 is increasing in Cambridgeshire faster than in neighbouring counties. Although it is a happy fact that residents in homes are living longer, that is creating additional funding pressures. Additionally, more residents are exhausting their savings to below the £16,000 limit, to the point at which they effectively become a first charge on social services departments. That has happened in 32 cases so far this year.

Cambridgeshire social services is doing what it can. It is supporting the elderly at home; trying to prevent admissions; being flexible in its review of care packages; and attempting to turn some of the available respite care beds into intermediate and convalescent beds, thereby allowing hospital discharge. The county council is consulting on a proposal to privatise remaining local authority provision of residential home places, as that would enable it to purchase about four residential home places for each three places that it currently provides in its own homes.

There is, however, an underlying problem of underprovision to the social services department. Provision to neighbouring counties may demonstrate the point. In 1996–97—the last year for which I have comparable figures for counties in the eastern region—in total on residential care, home support and nursing care, Cambridgeshire was spending £467 for each 75-year-old or older resident in the population. The figure was £840 for Hertfordshire, £908 for Norfolk, £925 for Suffolk and £1,075 for Bedfordshire.

The Minister and those of us who know Cambridgeshire well will know that Cambridgeshire social services has a particular requirement to focus its activities on children's services and to support its child protection activity. The county council is taking that responsibility extremely seriously, and that is partly influencing its distribution of funds within social services. However, that is only part of the story.

The principal determinant of the county council's ability to spend on services to the elderly remains provision of finance as dictated by the standard spending assessment. The Minister will realise that Cambridgeshire county council is capped at an extraordinarily low spend level, and that it therefore lacks the discretion to go further in increasing its overall resources.

I ask the Minister to do three things. The first is to enhance Cambridgeshire's standard spending assessment in the forthcoming round, to the point at which the county council's social services department is able to meet the responsibilities that it incurs. The second—on the process of winter pressures money being provided to assist in ending delay in discharging patients from acute hospital beds—is to end ad hoc funding and to make funding reflect the continuing revenue costs of such placements. The third is to end the process whereby the Government are effectively paying for social services activity with health money—whereby health care funds are being diverted into social care. Such a diversion of funds has adverse effects on a health authority's ability to use the resources with which it is provided for health rather than social services.

I hope that I have demonstrated that there is an underlying problem of a lack of residential home care places in South Cambridgeshire. I shall refer in particular to Meadowcroft home in Trumpington, which is not a local authority home, but is owned by the Red Cross. It formerly had some 20 places, but, in March 1997, the Red Cross decided that it should close—at a time when South Cambridgeshire can scarcely afford to lose residential care places.

The Red Cross has presented three arguments as to why it is necessary to close Meadowcroft. The first was that it was non-viable. It is clear that it was once perfectly viable, but the decisions to run the home down, not to take additional placements to reduce the number of residents and to discontinue a contract with the Lifespan community trust for two respite care beds have made it no longer viable. Secondly, it was argued that the home needed considerable investment to bring it up to registration standards. As a royal charter body, the Red Cross is not required to bring its homes up to registration standards. It would be desirable to do so if it were planned for the home to provide long-term care for new residents, but the existing residents see absolutely no reason for their living standards to be changed. Thirdly, it was argued that the remaining residents could and should be moved as it would be in their interests. However, it is perfectly apparent that they do not need full-time nursing care. Meadowcroft is a residential care home, not a nursing home, and is perfectly capable of supporting its residents.

After a period of rundown, Meadowcroft has only four remaining residents, all over 90-years-old. Two of them were among the first lady medical practitioners in Cambridge, who were part of a three-handed practice before the war. Dr. Margaret Reed is 98 years old and Dr. Joan Cooper is 106 years old. Last week, Dr. Cooper told me that she qualified as a medical practitioner in 1920. They are distinguished constituents of mine and they have provided a considerable service to the local community and to the Red Cross in the past.

I understand—not least because I have spoken to those who took the decision—that the decision to close the home was made with good intentions and that the Red Cross seeks to focus its activities on short-term emergency care. However, I continue to contend that bureaucracies and committees are capable of making decisions that individuals would not make. If one asked the individuals involved whether they thought it right that, after 15 years residence at Meadowcroft, Dr. Cooper, who is 106 years old—although she is by no means frail for her age—should be moved as a consequence of a desire to close the home, no doubt they would reply no, but I fear that bureaucracies will continue to say yes. The time has come for that to stop.

I feel quite strongly about Meadowcroft: very frail or elderly people have been moved from places where they were happy and which they regarded as their home and, as the Minister knows, that can have adverse effects. Even if, viewed objectively—and not least by bureaucracies—a move is to better or more appropriate circumstances, it can be in the interests of the individuals concerned to remain in familiar surroundings where they are happy and content. Anyone visiting the Meadowcroft home in Trumpington will know that the residents are perfectly happy there and that they are well settled and looked after and capable of being sustained there if the Red Cross cares to sustain them.

I call on the Red Cross to fulfil the expectations of the residents; the intention of the original trust deed established by Lady Ida Darwin in 1946, under which a substantial bequest was made; and subsequent benefactions. I do not believe for a moment that any charitable donor to the Red Cross would begrudge its meeting its obligations in that way, especially as the home has made considerable contributions to Red Cross finances in the past.

I thank the House and the Minister for listening to these related issues. I hope that the Minister will recognise and respond to the problems experienced by south Cambridgeshire and my constituents relating to the provision of social services and the placements into residential home care beds. I hope that the Red Cross will listen to the debate and change its mind about its proposal to close the Meadowcroft home early next year and to require my constituents to move to alternative accommodation.

First, I congratulate the hon. Member for South Cambridgeshire (Mr. Lansley) on securing a debate on this important subject, and thank him for his generous words of welcome at the beginning of his speech.

The hon. Gentleman has raised a number of issues around residential care. In doing so, he has emphasised the links with the national health service. He is right to do so. In Cambridge, as elsewhere, the NHS is an integral part of community care. He also raised the issue of the closure of the Meadowcroft home in Trumpington, to which I shall refer later.

It may help if I begin by talking about the aim of community care, which is to provide the support that frail or vulnerable people need to live in their own homes or homely settings, retaining the independence, dignity and quality of life that come from being a part of the community. Social services, to which the hon. Gentleman referred, have a central role here, but as one of several partners, along with housing authorities and the NHS. Each partner needs to understand the others and to draw effectively on their contribution to overall care provision.

Social services have the lead in community care planning. In Cambridgeshire, as elsewhere, that is about planning and commissioning a balanced range of services—including residential care—to enable authorities locally to meet the assessed care needs of individual service users.

People's needs do not recognise organisational boundaries. That was one of the themes of the hon. Gentleman's speech. In the case of older people particularly, they are often complex. They also change both in the short term and over a longer period. Following a period in hospital, people may need additional support, perhaps from the community health service, if they are to return to their homes; or they may need a residential care place if discharge is not to be delayed or unnecessary readmission caused. We need to consider residential care provision within the broad context of community care services, mapping out the key links with the NHS, housing and other agencies.

In planning residential care, in Cambridgeshire as elsewhere, what is important is joined-up thinking in the wider community care and health context. Residential and nursing home care provision is closely linked with hospital discharge arrangements, rehabilitation services, domiciliary support and current work on prevention.

The interdependence of health and social care make it essential that the provider agencies collaborate effectively in service planning and commissioning, assessment and delivery, and not least, funding. Section 28A of the National Health Service Act 1977 has long been a key funding mechanism enabling health authorities to support social services. I am sure that the hon. Gentleman would not want to give the impression that the new Government are approaching the issue any differently from their predecessor. That mechanism includes supporting residential and nursing home placements through "dowries" and similar payments in respect of people transferring out of long-stay hospitals, and supporting innovative cross-agency service.

We are providing a positive agenda of change. Joined-up thinking and partnership between health and local government run through our agenda. We have an ambitious programme of review and reform including the royal commission on long-term care, the forthcoming social services White Paper and our charter on long-term care. Other examples include the better services for vulnerable people initiative and "Partnership in Action: New Opportunities for Joint Working Between Health and Social Services", the recent discussion document trailed in last year's "The New NHS" White Paper. It might be helpful to say a little about that context before returning specifically to residential care, to social services funding and to arrangements in South Cambridgeshire.

Collaboration between local authorities and the NHS is considered in detail in the recent discussion paper "Partnership in Action", which sets out plans for a new statutory duty of partnership. Much of the paper is about collaborative funding mechanisms, such as proposals for the new NHS Bill to provide for health and social services to pool budgets, delegate functions and resources to each other in lead commissioning arrangements or develop integrated provision of services. It also envisages a significant widening of health authority powers under section 28A of the 1977 Act, with funding going to local authorities in support of objectives set out in health improvement programmes.

Last December, following our manifesto commitment, we established a royal commission on the funding of long-term care for elderly people. The commission is looking at demographics and future levels of need, different models of provision and how it should be funded. The commission is due to report around the end of the year.

Last year, in an executive letter, "Better Services for Vulnerable People", we set out the medium-term agenda for people with continuing health and social care needs. The circular asked local and health authorities to take forward work in three areas: first, drawing up joint investment plans; secondly, establishing a national framework for multi-disciplinary assessments of older people in acute and community health settings, carried out jointly with social services; and thirdly, developing a range of recuperation and rehabilitation services for older people.

Further guidance on the better services initiative was issued in August by the NHS executive and the Department's social care regions. Joint investment plans are a distillation of the health improvement plan and community care planning information. They bring together in a single document the joint information needed for health and social services to deliver on their respective responsibilities. The recent guidance requires health and local authorities to have JIPs in place by April 1999, as a minimum, for older people, including those with mental health problems.

Multi-disciplinary assessments by health and social services have always been a joint responsibility in community care. More effective multi-disciplinary assessment means better co-ordination of care services. In the community, it may avoid unnecessary hospital admission and allow older people to remain in their own homes for longer; within the hospital setting, good multi-disciplinary assessments may avoid an unnecessary admission subsequently to institutional care. Similarly, developing recuperation and rehabilitation services will enable people to return to the community sooner and to remain in their own homes. I am sure that the hon. Gentleman agrees that that is common sense.

Those are also key themes in the forthcoming social services White Paper, giving the context within which services such as residential care must be seen and developed. We should be aiming to maximise independence rather than supporting dependency. We need a new emphasis on rehabilitation, recuperation and prevention services. Crucially, the White Paper programme is underpinned by the personal social services settlement—an additional £2.8 billion over three years secured in the comprehensive spending review.

Last winter, an additional £269 million was allocated for tackling winter pressures. While that money was non-recurrent, it was not just elastoplast for the winter. It provided an opportunity for longer-term improvements in services, relationships and systems. Among the priorities applied in allocating the funds were plans that would reduce delays in discharging patients and reduce the need for people to be admitted to hospital in the first place, for example by strengthening primary, community and social services.

Winter pressures were well managed by social services departments, health authorities, trusts and other agencies working in partnership. Cambridge and Huntingdon health authority received £1.4 million of the £15.174 million available to the Anglia and Oxford region. Nearly £1 million of that went to social services to enable the discharge of delayed patients at Addenbrooke's, Hinchingbrooke and Lifespan into nursing and residential homes.

Let us look ahead to the coming winter. Last week, the Chancellor of the Exchequer announced that we would find a further £250 million to help the national health service and social services to cope with 1998–99 winter pressures. The English share of that total is £209 million. On Monday, my right hon. Friend the Secretary of State for Health announced how the first £159 million would be allocated. That will build on the success of our measures last winter by again tackling discharge and unnecessary admissions and by strengthening community-based services. I am sure that the hon. Gentleman will join me and his fellow Cambridgeshire Members in welcoming the additional £14.67 million that the Cambridge and Huntingdon health authority will have at its disposal in the next year. That is a 4.1 per cent. real-terms increase. I am sure that the money will be used to address some of the concerns that he has raised.

Once again, health authorities will be encouraged to use section 28A to transfer resources for joint schemes to social service departments when appropriate. In some pressure spots, that will mean purchasing extra long-term placements in residential and nursing homes. We would also expect social services to be supported to invest in community-based rehabilitative and recuperative care.

I am sorry to interrupt the Minister. Will he clarify that the £14.7 million to which he refers is an increase in the overall allocation to Cambridge and Huntingdon health authority? Is he yet able to say what winter pressures money is available for the year ahead and whether there will be continuing support to follow up that money?

The £14.7 million includes the additional allocation for winter pressures in the forthcoming period. The money has been treated together.

Decisions on the level of local authority expenditure are taken each year, following detailed discussions with the local authority associations. In setting the level of expenditure for each of the main services, the Government take account of anticipated pressures on those services. Resources are distributed on the basis of standard spending assessments.

Spending priorities vary from area to area and no one is better placed to assess those priorities than the authorities locally. Some 90 per cent. of resources for social services are allocated to the local authority on an unhypothecated basis. Authorities are free to choose how best to allocate the money internally.

Cambridgeshire's standard spending assessment per head is below the national average, but the hon. Gentleman should bear in mind that the SSA reflects the relative need for social services in an area, which research has shown to be linked to the extent of social deprivation. Cambridgeshire is a less deprived area overall, so we might expect it to have less social need than the average authority. For example, in 1996, around 15 per cent. of people over 60 in Cambridgeshire were on income support, compared with more than 40 per cent. in Tower Hamlets and Hackney. The hon. Gentleman also referred to the change made last year in distributing the elderly residential SSA for Cambridgeshire, mentioning a figure of £1.4 million. That allocation was made after extensive independent work by the University of Kent on the characteristics of people requiring local authority assistance. There is no question of Cambridgeshire being unfairly treated in the allocation or victimised by the change in the method of distributing resources.

We intend to ensure that social service budgets are given the right priority among the many services receiving Government support. We recently announced that funding for social services would rise by more than 3 per cent. above inflation for each of the next three years. The hon. Gentleman referred to the closure of the Meadowcroft home in Trumpington. I am sure that he appreciates that decisions about the commercial viability of individual homes are not matters for Ministers in the Department of Health. When residents have to move because of the closure of a home, I expect local authorities and health authorities to work together to ensure that the arrangements are appropriate and are handled sensitively. I understand how traumatic it can be for frail, elderly and vulnerable people, such as the hon. Gentleman's constituents, who have to move from residential care or a nursing home that has become their true home. We are not in a position to prevent the closure of an independent home if the home owner or the organisation running it considers it to be no longer viable. I repeat the message that we have sent to many organisations in this field—we expect local authorities and health authorities to work sensitively to manage the movement of those very frail and vulnerable people.

In conclusion, I am grateful to the hon. Member for South Cambridgeshire for giving the House an opportunity to discuss some very important issues. In the longer term, we are aware of the need to develop a fair and sustainable method of funding long-term residential care, and I look forward to future opportunities to debate those issues more fully in the House.

I am pleased to have this Adjournment debate on an issue that some would say is, in a sense, history—a planning application in my constituency, one or two aspects of which were unique. My hon. Friend the Under-Secretary is familiar with the case.

The planning application was for an opencast coal site where work was completed in 1982—a long time ago—and which was reclaimed in 1994 for commercial development. Some 65 out of 90 acres have been reclaimed. The planning application was to use the first 20 acres of the site. I should add that next to the site is the Orgreave opencast coal mine, where there is a massive scheme—one of the biggest in Europe—to clean up industrial dereliction. When that work is finished, some 800 acres of land will be available for use—all of it ex-industrial or brown-field site land.

The local authority, Rotherham borough council, is working up a master plan for the whole site which may include business and industrial use, leisure, housing, a shopping centre, schools and open space. In effect, we are looking at producing a new community on the site.

The application was made by an American company, AMC, which, in a letter to the Government's regional office in January 1997, said:

"AMC Europe is the subsidiary of AMC Entertainment Inc.. one of the largest cinema circuits in the USA, and we are considering a redeployment in the UK, where AMC pioneered the Multiplex complex in the mid eighties, thus initiating a spectacular growth of the cinema attendance (from 45 million tickets sold in 1985 to close to 130 million in 1996.) Our target within the next decade is to build approximately 10 4–6,000 seat–20–30 screen multiplexes integrated in full entertainment centres around the major metropolitan areas of the UK."

It is clear that the implications go far wider than the application for the site in my constituency.

The letter continued:

"Our objective in Waverley is, by using the synergy between the cinema and the other restaurant and leisure activities planned on site, to generate a sufficient critical mass to turn the site into a true leisure destination, thus attracting customers from a much larger catchment area than a traditional multiplex".

The plans that I saw proposed a catchment area from West Yorkshire to the middle of Nottinghamshire. The letter continued:

"The Waverley Park site is well adapted to the development of our concept, due to the large catchment area, the excellent access and relatively few competing leisure schemes."

The letter said that the company had built a similar project in Portugal in December 1996, and that there was a clear demand for multiplexes.

The leisure industry report for 1998 says that there are approximately 110 multiplexes in this country, which begs the question: how many more can the UK take before saturation point is reached? This is all relevant to the Secretary of State's decision on the project. Operators' opinions on how many more multiplexes the country could take differ, but the average seems to be between 80 and 100. The development plans of the UK's established multiplex operators clearly reflect the current strength. This is a big area for growth in the British economy. AMC's application was submitted in 1996 and went on its journey through the Government regional office, which I visited in September 1996. I had been approached by the developers, and I was interested in the cultural change in activity in my constituency which, as hon. Members will know, has suffered from the rundown of its basic industries for more than a decade. To my knowledge, it was the only proposal for the site, and I was excited about it.

As ever with planning applications that are called in by the Government, the decision took a long time. I understand that, even after the general election, there were several meetings in the DTI about whether to call in the application for a public inquiry. Ministers asked for more information, and my hon. Friend the Under-Secretary asked for details in relation to planning policy guidance note 6—the alternative site test—and PPG13, concerning public transport.

That information was sent in by the planning authority in June this year, yet it took until September before the final decision to have a public inquiry was made by the Secretary of State—something that I did not want and had lobbied against. The decision was communicated to the developers by letter on 25 September. The time scale about which we are talking is from July 1996 until 25 September, when the decision was taken. That is a long time to ask someone who is preparing to invest millions of pounds into a project to wait.

The criteria laid down by the public inquiry were known by the Department. The Department had asked about PPG6 and PPG13 only a few months before, and had been given a comprehensive report about the tests by the planning authority. The Department also asked about accessibility by a choice of means of transport and the likely effects on travel patterns and car use; the likely impact on the vitality and viability of existing town centres; whether there was a clearly defined need which could not be accommodated in or on the edge of existing centres, and particularly whether smaller-scale developments could be located in town centre or edge-of-centre sites; and whether there has been a proper sequential approach to site selection.

At the pre-inquiry meeting in March, my constituency office was represented by Sheena Woolley —who has worked for me for many years—and she took evidence, in shorthand, of what was said by the different parties who were called by the planning inspector. It became clear at that stage that the South Yorkshire passenger transport executive was not prepared to give evidence because

"they fell between two groups."

I assume that that meant that they fell between one of the principal objectors, Sheffield city council, and Rotherham borough council, the planning authority which wanted the scheme to go ahead. Both authorities sit on the South Yorkshire passenger transport executive.

I would like to mention someone else who was at that meeting and who had done a lot of work in relation to the project—Rotherham borough councillor, Reg Littleboy, who had collected a lot of signatures in a petition from the local community to support the application. Reg gave evidence at the inquiry.

I attended the public inquiry twice during the four days that it sat. I gave evidence on the fourth day, and what I witnessed—and what was reported in the local press—was hardly about the wider issues in relation to the site. It was more like a report of a bad neighbour dispute; in my 15 years in the House, I have always tried to avoid such disputes as they are so difficult to solve. Unfortunately, that was how it panned out in the media and during some of the discussions. I am pleased to say that the neighbours are now having constructive discussions about co-existence with one another, and I welcome the co-operation between the two planning authorities.

The inspector's report was clear—he rejected the application. Two issues were involved. The first was public transport and, on that, he seemed to look no further than the end of his nose. The single planning application was for a 20-acre site, but the development would eventually cover 800 acres. Planning law is restrictive in that one cannot look at the wider picture when deciding on individual schemes. Perhaps we should look into that. The inspector's overall conclusion was that

"the proposed leisure park would be primarily reliant upon the private car",

and I accept that. That is the reality for out-of-town developments, and I do not hide from it. However, the inspector gave no weight to the benefits of the park-and-ride scheme that had been proposed for the site. It is a cart-and-horse situation: do we get transport by planning for it, or by demand? I believe that it is demand led, and I am sure that public transport on the site will be more than adequate when that site is fully developed.

I am well aware of what can happen with out-of-town developments. The Meadowhall retail complex is only three miles from the site. It was built in the 1980s without a public inquiry and with no objection from the planning authority, and it is still being developed. Meadowhall is an enormously popular place for people to visit and spend their money. The slogan in advertisements on regional television states that it has parking spaces for 12,000 cars. That is what sells it.

At present, the private car is the overwhelming choice of transport for the individual. We cannot use the planning process to force people on to public transport. One can lay down stipulations to improve access and a line has to be taken, but refusing planning permission is not the way to do it. We should consider other ways, and making the buses more affordable would be a good start. We must recognise that they now run for profit. Public transport is not what it was a decade ago. In my constituency, buses have stopped running to certain villages in rural areas because such services are not profitable. It is not the public service that it used to be. I do not know how the Government will square that, but it has to be done.

The South Yorkshire passenger transport executive should have given evidence on the public transport aspects. It decided not to do so and I believe that it was got at—by whom I am not sure. Its written representation to the public inquiry is recorded in paragraph 143 of the inspector's report, which states:

"The South Yorkshire Passenger Transport Executive… was opposed in principle to the out of centre location of the proposal, which was contrary to the transport policies in the South Yorkshire Joint Transport Package Bid and to Government planning guidelines."

That view contrasts with a letter that the PTE sent to interested parties dated 10 July 1997, which stated:

"I can confirm that the Transport Executive is now satisfied that your development proposals can be adequately served by public transport.

We note that in addition to the provision of public transport infrastructure, you have indicated your willingness to support late evening bus services and are prepared to enter into agreements for the allocation of certain parking spaces for park and ride use."

The passenger transport executive was not hiding its head in the sand and wanted to use the site to improve transport where it could.

After I gave evidence at the public inquiry and questioned why the SYPTE had not done so, I received a letter from the executive, dated 13 May 1998, which stated:

"I had some feedback from my officers who were present at the inquiry regarding your own comments and also those relating to the PTE's initial objection …I am quite happy to meet with you to discuss your concerns".

I was unhappy at the situation and did not take up the offer, but wrote to my right hon. Friend the Minister of Transport to tell him of my concern regarding the passenger transport executive's lack of action on the matter and the fact that it was not willing to give evidence about public transport. I received a reply from my right hon. Friend saying that, although he could appreciate my concern

"SYPTE chose not to give public evidence at the Public Inquiry. However, I have to say there is no compulsion on third parties to do so and that is not a matter in which I could intervene."

He suggested that I should pursue my concerns with the PTE.

This is not a matter for my hon. Friend the Under-Secretary today, but it is scandalous that a publicly funded quango, which is what the SYPTE is, was not prepared to give evidence at a public inquiry. Taxpayers pay for that organisation to have opinions on public transport. It is atrocious that contradictory messages have resulted because it did not take the stand to give evidence at the inquiry. Although this debate is retrospective, I should point out that the organisation has done itself a disservice by not doing so.

The other issue in the report is the sequential test on site selection. In paragraph 191, the inspector states:

"In applying the sequential test, it was agreed that there is no single site in or on the edge of either Sheffield city centre or Rotherham town centre which could accommodate either the whole leisure park or the 24 screen cinema alone… However, to my mind the sequential test could always be thwarted if that was the correct basis for the assessment, by proposing development of such a large scale that it could rarely, if ever, be housed in or on the edge of a centre."

I must agree with the inspector there. Developers could easily exploit the situation, saying that they needed to use a green-field site–20 acres of countryside—because they could not find comparable acreage in a town or city centre.

The inspector goes on to say:

"To satisfy the sequential test, I consider it to be necessary to examine whether the individual elements of the proposal could be provided for on city centre or town centre or edge of centre sites. That should include consideration of whether smaller cinemas could be accommodated on such sites."

The following paragraph states:

"Applying the sequential test on that basis, a need for 24 further cinema screens could be accommodated in Sheffield city centre"—

pretty conclusive, I guess. The inspector continues:

"The Castlegate and Heart of the City redevelopment sites have the capability to provide that number of screens in 2 separate cinemas …Neither site is likely to be available to the applicants in this case, as other developers are involved."

The inspector states that the development should be in the city centre, but that the developers can forget it because they will not be able to build there.

Paragraph 197 of the report states:

"I have concluded that there is no clearly defined need for the development proposed which could not be accommodated in or on the edge of existing centres, provided that flexibility is applied to the form of the development, both in terms of the size of the cinema, and of the willingness to accept that the individual elements of the scheme could be built on separate sites."

That reads like a page from the five-year plan of some centrally controlled state.

We must recognise that leisure is the fastest growing industry in the United Kingdom. It is also the biggest. It is bigger than the whole of manufacturing industry and it creates more jobs than any other sector—one in five new jobs created in the next 10 years will be in leisure and hospitality.

If coalfield areas, such as the one that I represent, are to be regenerated, they will need a share of that jobs market. However, they will not get a share if the town and city test is the only criterion applied. Coal mining jobs were lost not in towns and city centres but in areas such as Rother Valley and the constituencies represented by my hon. Friends the Members for Rotherham (Mr. MacShane) and for Wentworth (Mr. Healey), who are in the Chamber.

At the Labour party conference in Blackpool in October, my right hon. Friend the Deputy Prime Minister said:

"You know the Tories ripped the heart out of the pit communities. We are determined to put the heart back into them, offering jobs and hope, instead of despair and the dole."

I never thought that I would say this, but my right hon. Friend's words rang hollow for me and my constituents, who, a few days before, had lost a £30 million inward investment package that would have created 570 jobs.

The more I consider this issue, the more concerned I am about the Government's approach to out-of-town development. That concern is shared by others. The Estates Gazette said in October that the Government had commissioned a consultant's report on the economic consequences of planning for the business sector and cited some negative comments about planning and PPG6. Mr. Huw Williams, the development policy manager for Sainsbury, said:

"people had broadly understood the agenda and understood what the sequential approach was about, but now we're beginning to see new considerations being brought into play…It's as if someone had gone back to PPG6 and highlighted new bits such as car parking and the exact relationship between edge-of-centre and town centre."

On 7 November, the paper carried an article headed "PPG6 upset in High Court". It stated that food store developers no longer had to prove need to obtain planning permission. It cited a partner at the firm Healey and Baker, who said that there had been a move over the past year or two to demand that developers demonstrated need. The article continued:

"This watershed decision will reassure developers that they don't have to. It should give the government cause to clarify its policy and iron out inconsistencies in the way PPG6 has been interpreted."

I recognise that some of those voices are laced with vested interest. Some people may say that I have a vested interest, too, but my interest is the good of my constituency. My concern is that proposals to begin the regeneration of a coalfield area are blocked by unclear planning guidelines. I know that my hon. Friend the Under-Secretary is reviewing planning matters, but how long is that process likely to take? I have been talking about one planning application for the site, but I hope that, now that that application has been blocked, there will be many more.

Will my hon. Friend also consider the difficult and perhaps unique problems of the coalfield areas and fully recognise the wider social and economic problems there, some of which can be addressed by the flexible and sensitive application of the planning guidelines? I know that, next month, my right hon. Friend the Deputy Prime Minister will make an announcement on the coalfields task force, but it is important that any review should recognise the great difficulties that coalfield areas face.

I recognise and support the Government's commitment to the regeneration of our cities and towns. I know that, with the local planning authority, they are doing a good job in transforming Rotherham town centre. However, if we are serious about the plight of former coalfield areas, a careful balance must be struck, so that the problems caused by the rundown of coal mining can be tackled.

I realise that I have not left my hon. Friend the Under-Secretary much time in which to respond—he may be grateful for that, as he will not have to comment on everything that I have said—but I should be grateful for an assurance that reviews will recognise where the markets are, and not focus solely on the needs of towns and city centres.

I congratulate my hon. Friend the Member for Rother Valley (Mr. Barron) on his success in securing this debate. He has referred specifically to the refusal of planning permission for a large leisure development at the former opencast site in Rotherham district at Waverley near Sheffield. I know that he has taken a close interest in the matter and that he has been both assiduous and forceful in pressing the case for development, which he believed would bring substantial benefits to his constituents.

As my hon. Friend said, the case was decided, following an exhaustive public inquiry, by my right hon. Friend the Deputy Prime Minister, in his capacity as Secretary of State for the Environment, Transport and the Regions. The inquiry inspector, having carefully considered all the material considerations in the case, concluded that the proposed development was in fundamental conflict with Government policy as set out in PPG6 and PPG 13. My right hon. Friend concurred with the inspector's clear recommendation and refused consent accordingly.

All planning decisions are taken in accordance with the development plan unless material considerations—including national land use planning policies and policies on town centres, retail and leisure development and transport—suggest otherwise. The Government have a responsibility to defend town centres against large out-of-centre shopping and leisure developments that are likely to harm the vitality and viability of town centres. My hon. Friend will be aware that the recent Environment Select Committee report on shopping centres recommended that Ministers took a tough approach on applications for large leisure developments, so that further damage to town centres could be avoided. In their response, the Government stated their commitment to ensuring that the approach in PPG6 to retail development is applied as firmly to leisure developments.

The criteria for assessing large out-of-centre leisure developments, such as that proposed for the Waverley site, include the likely harm to the strategy in the development plan, the impact on the vitality and viability of nearby town centres, accessibility by a choice of means of transport and overall travel patterns. There should also be a flexibly applied sequential approach to site selection, so that out-of-centre locations are considered only when the development cannot be accommodated in town centre or edge-of-centre locations.

All planning applications for major leisure developments must be considered against those criteria. Moreover, PPG6 states that town and district centres should be the preferred locations for developments that attract many trips and PPG13 states that, by planning land use and transport so that people can carry out their everyday activities with less need to travel, local planning authorities can reduce reliance on the car and contribute to reaching the environmental goals that are set out in the Government's sustainable development strategy.

My hon. Friend the Member for Rother Valley has forcefully expressed his disappointment about the Waverley decision. However, he would agree, I am sure, that it would be wrong to suggest that nothing is being done to support and regenerate the coalfield communities. My right hon. Friend the Deputy Prime Minister has given a high priority to action to assist those communities. The South Yorkshire coalfield areas have benefited from a wide range of regeneration activities, which have been undertaken with help, for example, from English Partnerships and the single regeneration budget.

My right hon. Friend was instrumental in setting up the coalfields task force in October 1997, with a remit to pioneer options for revitalising the former coalfield communities that were affected by pit closure programmes. The task force's report "Making the Difference", which was published in June 1998, contained recommendations for regenerating coalfields communities and was warmly received. My right hon. Friend gave the Government's initial response to the report in July. He said:

"The Coalfields Task Force's vision was to set up a framework which will empower communities to create their own new start. This Government is committed to do its part to make this vision a reality. I want to put a powerful framework in place to deliver a comprehensive programme of regeneration for our coalfields communities."

My right hon. Friend the Deputy Prime Minister will launch the Government's action plan for the coalfields, and a detailed response to the task force report, at a second coalfields conference on 1 December at Peterlee leisure centre in County Durham. I understand my hon. Friend's disappointment at the Waverley decision, but I hope that he will agree that the Government are taking many initiatives to respond to the needs of the coalfield communities. The process of reviewing and modernising planning is under way, and revisions to various planning policy guidelines will be issued over a period. There is a strong focus on speeding up the planning process, and I agree that we need to ensure that there is not undue delay in considering applications.

I will relay to my right hon. Friend the Minister of Transport my hon. Friend's comments about the South Yorkshire passenger transport executive not giving evidence.

I thank your office, Mr. Deputy Speaker, and the two Departments involved, for co-operating on the change of title for this debate so that a Treasury Minister could respond to it.

We have a strategic industry that is in real crisis: 95 per cent. of all freight is moved by road—in a rural area such as my constituency, the figure is as high as 97 per cent.—and there is no real alternative for the foreseeable future. The most optimistic estimates suggest that, even if the huge projected investment in rail freight for the next 10 years were to materialise, that would only double the rail share, from 5 to 11 per cent. Road would continue to expand and would probably hold steady at about 90 per cent. of freight transport.

Our whole economy depends on maintaining an efficient road haulage industry. No business —or family—does not use goods that were moved at some stage by road. There is not an hon. Member here today who is not wearing clothing or who has not eaten food in the Tea Room that was carried at some stage by a diesel-powered vehicle. The average Sainsbury store has 23,000 items, all carried by road.

There are 420,000 commercial vehicles of more than 3.5 tonnes in the United Kingdom and they move more than 1.6 billion tonnes of goods, yet the future of the 65,000 road haulage businesses is in jeopardy. By 2002, the current crisis may have caused 26,000 job losses, and a loss to gross domestic product of £1.5 billion and to the Treasury of £1 billion; and the Government are entirely to blame. One of the few remaining areas of taxation over which each nation state in the European Union has retained 100 per cent. of its decision-making powers is the setting of fuel and vehicle excise duty.

The Government are using their power in a bizarre manner, actively putting a strategic industry at a massive disadvantage. The fuel duty escalator was introduced in 1993, in response to the Rio commitment to reduce greenhouse gas emissions. It was originally set at the retail price index plus 3 per cent., but the Labour Government increased it to RPI plus 6 per cent. in 1997, adding a further gratuitous 1p per litre on diesel in the 1998 Budget.

The House of Commons Library calculates that Labour has added £9 billion of extra fuel duties during this Parliament. The escalator on diesel and petrol this year gave more to the Treasury than 1p on income tax would have done. By 2002, the policy will cost the haulage industry £5 billion a year.

Ninety-nine per cent. of lorries are diesel-fuelled, and fuel represents a minimum of 30 per cent. of the operating costs of running a lorry. According to the Library, 82 per cent. of the price of fuel in the United Kingdom is taxation. Each 38-tonne vehicle pays £22,000 a year in tax. There is a widening gap between the UK and our continental competitors. Excluding VAT, UK diesel costs about 56p a litre, of which duty is 44.99p; in France, it costs 35p a litre, of which duty is only 24.57p. The 21p a litre—or 95p a gallon—difference means that to fill a truck with two tanks, which takes 1,200 litres, costs £252 more in the UK than in France. The comparisons with Benelux and Germany are even worse. My constituents are in desperate trouble. Dale Roberts, from Morda, wrote to me and said:

"The 5.5p per litre increase on diesel is slowly but surely strangling the industry as there is no way in which we can claim this increase back. Our customers are in much the same situation as ourselves with an appalling cashflow problem. Unless something is done, and soon, the haulage industry of this country will be in a decline from which it will find it very hard to crawl back."

Mr. Jagger, from Pentre, who handles timber—notably, he took the timber down to St. George's hall for the restoration of Windsor castle—wrote to me in July. He said:

"At this present and proposed taxation, it is going to become impossible to continue to operate to an acceptable standard. Unless the Government comes to its senses many good hauliers will go to the wall with many people losing their jobs."

There is even worse—possibly much worse—to come. Vehicle excise duty on a 38-tonne truck costs £3,210 in the UK; only £459 in France; and a mere £296 in Spain. A typical international haulier in the UK, running 50 trucks, was £150,000 worse off than his Spanish competitor before he even got out of bed on 1 January this year; yet the Chancellor has already said that he has plans to make new heavier lorries subject to even higher rates, to discourage their use.

Andrew Wishart, in Kirkcaldy, has 16 trucks and has told me that, if the four-by-two-axle VED goes up to the rumoured level of £7,000 to £9,000, he will move abroad. He transports car parts and telecommunications parts to eastern and southern Europe, so he drives through Belgium, and he is already taking steps to set up a base and an office in Belgium.

My hon. Friend is understating the case, as all this is happening in the context of an agricultural economy in decline. Many haulage firms are based in rural areas such as my constituency and his, and they are already facing other problems. The burden of extra duty comes on top of an agricultural and rural crisis.

As always, my hon. Friend is spot on. I was about to cite the case of a haulier who transports lambs from Carlisle to Newtown and now has to pay an extra £60 for each load. That is an extra burden on the sheep industry, which is in real crisis, as my hon. Friend and I are well aware.

Eddie Stobart's name will be familiar to most hon. Members from his 800 very smart red and green lorries. He employs about 2,500 people. If he moved to France today, he would save £2.2 million on VED alone. If the proposed hike on heavier vehicles goes through, it will be even worse. Yesterday, he said to me on the telephone, "Unless the Government sees sense on fuel and VED, I will have actively to consider cheaper alternatives to running my business based in the UK."

That is a major worry for me, because distribution is a major business in North Shropshire. It is run by the entrepreneurs whom the Government lecture us that we should have: the people who have built up businesses from nothing. The Woodward family in Oswestry began importing sausages in the back of their car, and kept them in their garage; in recent years, they have invested £15 million in a state-of-the-art distribution centre and they have 89 trucks.

May I instance another Shropshire business, owned by Mr. Owen of Lydbury North who tells me that, of a fuel bill last year of £28,500, £24,795—no less—was duty?

As always, my hon. Friend has his feet on the ground and knows what is going on.

The increases cannot be passed on. Nigel Woodward told me that he

"cannot get any increase from his customers."

The Penton family, down the road from the Woodwards, have invested £12 million. According to Andrew Penton, they

"are seriously considering flagging out, and sthey have slowed their expansion plans here."

The only relief on VED is the £500 allowance offered by the Government to encourage vehicles to be fitted with particulate traps, enabling them to use low-sulphur diesel. That sounds a good idea, but the conversion kits alone cost £3,500; low-sulphur diesel is extremely hard to find; when one eventually finds it, it is more expensive than conventional diesel; and, unbelievably, it is 5 per cent. less efficient than ordinary diesel. Not surprisingly, I have yet to find a haulier who is tempted by the Government's kind offer.

For the time being, the Government are milking rewards from the policy, but the long-term consequences for Government revenue are serious. I talked last week to an international haulier based in Kettering who deals exclusively with Italy and Spain. He has not filled up one of his 20 trucks in the United Kingdom in the past 18 months. By 2002, more than £1 billion of tax revenue will be lost to the Exchequer from fuel being purchased abroad. Smuggling across the Irish border is rampant—it is estimated to cost between £ 100 million and £150 million. We do not know the exact figure, because the Government do not care. They are happy to lecture the workers of Rover on the need to be more efficient, but when my right hon. Friend the Member for Wells (Mr. Heathcoat-Amory) asked about the extent of cross-border smuggling, the Economic Secretary replied, in a written answer:

"HM Customs and Excise have no estimates for the revenue lost to the Exchequer through these activities."—[Official Report, 22 October 1998; Vol. 317, c. 1201.]

One way in which the Government could raise revenue is through tolls. British trucks running through the Benelux countries and Germany pay £4.20 a day for a vignette and, as we know, autoroute tolls in France and Italy are even higher. A truck last week running from Calais to Mont Blanc paid £95 for the one-way trip. Vehicle excise duty is adjusted in those countries to allow for the tolls, but the House of Commons Library has told me that 600,000 foreign-registered goods vehicles left the UK for mainland Europe in 1997. The industry feels bitter that no charge is levied on such trucks, which can come here when they like. They can be any weight and put out any kind of pollution. The Government intend to penalise heavy trucks, but not if they come from Europe.

As a free trader, I welcomed the arrival of cabotage on 1 July, which enabled the free movement of goods within the European Union by any European Union haulier, but that is no good if the game is rigged against the UK haulier. French trucks with a range of 1,200 to 1,300 miles can easily reach Shropshire and clock up 600 miles of profitable business before returning to Calais to fuel up and take advantage of cheaper VED under the more sensible regime of the French Government. My constituent, Martin Edge, said today:

"We welcome competition, but it must be fair. Our current position is disastrous."

A further, sinister implication arises from information I learned from a haulier in Lincoln last week, who already has six vehicles registered in France. He said:

"There is a significant difference in the quality of the annual MOT test. Here in the UK it is rigorous and it is right that it should be. By comparison French MOT test standards are lower across the board. The brake test is a complete joke."

A proud, successful industry has been brought to its knees because the Government believe that they have found a source of revenue that will not bite back. I have been in correspondence with the Financial Secretary since April. The replies have been as complacent and lacking in understanding and information as they have been late in arriving. My letter of 20 July, which enclosed a letter from Billy Griffiths, a major local employer, received a reply only on 24 September.

The Minister stated:

"I am sorry for the delay in replying. This is due to parliamentary recess."

In a parliamentary recess, Ministers do not have tiresome Back Benchers such as myself calling them to Parliament to answer Adjournment debates. If a business were run so incompetently, it would have gone bust long ago. My requests to bring a delegation to meet the Minister have been constantly refused, but the presence at Westminster today of hundreds of truckers— who have come from Bury St. Edmunds, Shropshire, the south-west of England and many other places—testifies that they must win on the issue to survive. They must also win on behalf of every business in the land, because they are all made less competitive by the policy. Transport represents up to 10 per cent. of the price of many manufactured goods and 12 to 13 per cent. of retail distribution costs.

The whole economy is being damaged, and I shall give one example. Ten years ago, a site in Market Drayton was a green field. Today, it is a state-of-the-art plant making yoghurt for Mullers from 100 million litres of milk. Every one of those litres is taken there by a diesel-powered truck and every yoghurt pot is taken away by a diesel truck. That magnificent — 60 million investment is a tribute to the policies that Conservative Governments introduced and to the work force of Market Drayton. It is a real success story and the Minister can enjoy the product in the Tea Room afterwards. However, I talked to the managing director this morning and he said:

"We are unable to pass on any of the increases in transport costs to our customers. Considering the huge investment, this is bitterly disappointing."

The intention of the policy is to improve air quality, but it will not do so. British hauliers will be forced to put off purchasing new, more efficient equipment and more work will be done by heavier, less-well-maintained and cared-for foreign trucks. The pollution will stay, but the polluter will not pay. New Labour claims to understand business. If that were true, the Labour Benches would be full. New Labours talks about productivity and global competition, but it has the power to change this policy. It is stupid and is damaging a key strategic industry, not to mention the whole economy.

I would like the Minister to answer two simple questions. Will she let me bring a delegation from the industry to see her before the Budget? Will she agree today to freeze any further increases in VED and fuel duty?

I understand the passion that the hon. Member for North Shropshire (Mr. Paterson) brings to the debate, but I regret the fact that he did not mention the environmental considerations that stand behind the policy—[HON. MEMBERS: "Yes, he did."' He paid almost no attention to those considerations and he paid no attention to the range of policies, which I am about to outline for him, that are designed to help the road haulage industry achieve our objective and theirs—to promote a British haulage industry that is sustainable, efficient and effective, and that also meets our environmental and social objectives.

Contrary to the implication in the hon. Gentleman's remarks, the industry has responded favourably to the approach to sustainable distribution that we set out in our White Paper, "A New Deal for Transport". For example, the industry has welcomed the fact that 40-tonne, five-axle lorries will be allowed for domestic use as well as for international movements, as we are obliged to do under European Union legislation. Those vehicles are no larger than existing 38-tonne vehicles. The industry has also endorsed our intention to improve enforcement in the industry through improvements in the efficiency of the enforcement agencies. We will ensure, for instance, that we get modern information technology systems into those agencies, which will allow much better co-ordination and sharing of data.

We have also heard from the industry an endorsement of our intention to impound illegally operated vehicles used by cowboy operators. The industry has been constructive in helping us to formulate those proposals, which will help to ensure that hauliers in the UK operate in a competitive regime, which is fair and honest. In the White Paper, we also stated that we will improve the service offered by trunk roads, by improving network control and traffic management. By maintaining and managing the existing road network better, we will reduce delays and improve the efficiency of the industry. All of us have wasted precious time sitting on crowded roads and seen necessary distribution vehicles also stuck in those queues. We will also introduce legislation to allow local authorities to charge road users to help to reduce congestion. That will benefit the haulage industry, because reduced congestion will lead to improved delivery time, efficiency and profitability.

We have also stated our intention to support the industry in promoting best practice, through quality partnerships and the Road Haulage Association's "Well Driven" scheme, which I and, I am sure, many other hon. Members have noticed increasingly on our roads. We intend to promote an industry that will support the country's economic growth and, at the same time, meet environmental objectives. We are committed to achieving the United Kingdom's share of the European Union target agreed at Kyoto to cut greenhouse gas emissions by 8 per cent. by 2008–12. All motorists need to make a contribution to achieving that target. It is estimated that the road fuel duty escalator, if continued at its current level from 1996 until 2002, will save between 2 million and 5 million tonnes of carbon annually by 2010.

The hon. Member for North Shropshire expressed with great force his concern, and that of his constituents and many in the industry, about diesel price increases and changes to vehicle excise duty. Of course we know that increased fuel duties and VED impact on the costs facing the road transport industry and hauliers, but we believe that the cost of using lorries must fully reflect the cost that they impose, including environmental costs. I am surprised that Conservative Members, who are free traders and free marketers who should understand the need to incorporate environmental costs into accurate pricing, do not apply it to this industry.

Will the Minister deal with the problem at the core of the debate? How do the Government intend to tackle the problem of the level playing field? How are we going to stop British hauliers moving to France or Belgium? What do all the things that she says that she has done for the industry amount to in cash terms, compared with the extra burden so eloquently described by my hon. Friend the Member for North Shropshire (Mr. Paterson)?

Happily, I was just coming to that point.

We are conscious of the impact of higher fuel taxation and VED on competitiveness and profitability, but it needs to be put into a wider context. The United Kingdom has lower corporation taxes, lower employment taxes and lower social costs than other European Union countries, especially with my right hon. Friend the Chancellor's recent Budget measures to assist small businesses. The overall tax burden is lower in the United Kingdom than in our major EU competitors and lower than the averages for the EU and the Organisation for Economic Co-operation and Development. [Interruption.]

Order. The hon. Member for East Yorkshire (Mr. Townend) may not want to listen to the Minister but I do, so I must be able to hear her.

Not only is the overall burden of taxation lower on British businesses— including the road haulage industry—than on European businesses, but, looking at business as a whole, transport is a relatively small part of total business costs.

Will the Minister give way?

No. I have already given way and would like to make some progress. Tax measures that we have recently introduced, or will introduce, to help road hauliers include the freezing of the standard VED rates for lorries. That means that lorry drivers are paying less VED in real terms than they were in 1990, and that partly offsets the impact of higher fuel duty and should help to maintain the competitive position of our road hauliers. A reduction of up to £500 in VED for low-emission lorries and buses will be introduced at the end of this year. There is also the freeze in duty on road fuel gases and the widened differential that we will maintain and, I hope, increase, in favour of ultra-low-sulphur diesel.

There were broader measures in the Budget that will benefit business and road hauliers: the 1 per cent. cut in the main rate of corporation tax; the 1 per cent. cut in the small companies rate of corporation tax, which next April will be down to 20 per cent; the introduction of quarterly payments for large companies, replacing advance corporation tax; the extension of enhanced temporary first year capital allowances; and the introduction of the taper to reduce the capital gains tax on assets held for longer periods, which is equivalent to a higher tax rate of 10 per cent. after 10 years on business assets.

The Minister is getting on to the second page of the letters that I had from the Financial Secretary. We have been through all this; it is irrelevant to the items that I raised. She mentioned the environment, but why have not other European countries imposed a fuel escalator if it is such a good idea? They signed up to Kyoto. She talks about the contribution of the industry to the environment, but £30 billion is taken from road users while only £2 billion is spent on roads.

The point of environmental taxation is to internalise the external costs imposed, in this case by road users, in the prices that they are charged, not necessarily to return the product of that revenue directly to them. Several EU member states, including the new German Government, are considering carefully proposals for carbon tax and energy tax. There are proposals at European level for an energy tax, which we will consider carefully.

Hon. Members raised the matter of competition from abroad. Despite what has been said, there is little evidence of foreign hauliers undercutting domestic hauliers for business in the United Kingdom.

The Gallery is laughing.

Order. The hon. Gentleman has mentioned the Gallery twice, which is outwith the rules of the House. He should not do it.

The fact is that less than 0.04 per cent. UK road miles are done by foreign hauliers. The long-term outlook for the industry in this country suggests that lorry traffic is expected to grow by more than 60 per cent. in the next 20 years, an enormous growth in that sector of the economy. That makes it imperative that the Government ensure, by effective use of taxation, that the lorries on the road are the most fuel efficient and environmentally friendly available.

Under EU legislation—I think that the hon. Member for North Shropshire welcomed this—hauliers are free to set up business anywhere in the European Union. That is a commercial decision for the businesses involved. Let me remind him that many other factors are involved besides the prospect of cheaper vehicle licence or fuel tax: the setting up costs; the burden of obtaining an operator's licence; higher drivers' wages; considerably higher social costs; higher corporation tax rates—and so on. Setting up a business on the continent has all those obvious costs. When all taxation is taken into account, the burden on business in the United Kingdom is lower than in other European Union states. Any British haulier who decided to set up in France or Belgium might find that road fuel taxes went down, but would certainly find that his social costs and wages bill went up. It is not surprising, when one considers the overall burden on business, that there have also been reports in the trade press of French hauliers registering their businesses in the United Kingdom to take advantage of lower business costs and the opportunities to grow their businesses.

The hon. Member for North Shropshire suggested that environmental taxes are simply an excuse for revenue raising. That is not the case. We are developing environmental taxes in line with the statement of intent on environmental taxation and with a vital principle both of market economics and of environmental concerns: prices should reflect true costs so that the polluter pays. Fuel duty increases are important to encourage further improvements in fuel efficiency and reductions in carbon dioxide emissions. Our spending is directed towards the people's priorities of education and health, from which everyone benefits, but also to increased spending on rural transport, which, as I hope that he agrees, will be of particular benefit to rural communities.

The hon. Member for North Shropshire raised specific questions about ultra-low-sulphur diesel. The early signs are that supermarkets will be able to sell ordinary and ultra-low-sulphur diesel at the same price, so UK refiners should be able to compete. In any case, we envisage altering the duty differential further in favour of ULSD. We believe that increased duty differential will further encourage the manufacture and use of the fuel. We need to look many years ahead, because ULSD offers substantial benefits to the quality of urban areas by reducing the amount of nitrogen oxide, black smoke and particulates produced during combustion. I know from my constituents how much concern there is not only about global warming, but about local air quality, because local pollution is one of the causes of the disturbing increase in asthma among children. I hope that all hon. Members would wish to take account of that.

The hon. Member for North Shropshire referred with concern to his correspondence with my hon. Friend the Financial Secretary—