I am glad to have the opportunity to discuss such an important issue and I am grateful that so many hon. Members have turned out on such a cold and frosty morning to take part in the debate. Now is the right time to consider the new structure that was recently announced by my right hon. Friend the Secretary of State for Trade and Industry, as well as the changes that we anticipate will be made to grant support. The case for grant support is crucial to textiles and it is one to which I shall return.

We are in a post-Doha world and the matters arising from that are also crucial to the textile industry. What makes now a good time to review progress are the recommendations of the textile clothing strategy group. That group was formed in 1998 by the Department of Trade and Industry and it issued a draft consultation report in March 2000. Since then, it has produced other reports and its latest report that was issued earlier this year entitled "Making it Happen" is what we would like to see happen in the textile industry.

The Transport and General Workers Union plays a vital role in the development of textile strategy. I thank Peter Booth, a union representative, for his work and for the information that he has given me about the current state of the industry in preparation for today's debate. He told me that, at a recent TGWU conference, more than 90 per cent. of the textile delegates reported mill closures and job losses in the industry. Even at a time of rising employment, I am sure that we all agree that all job losses and mill closures are sad. We must examine closely the reasons why any industry starts to fail.

There have been job losses and mill closures in my constituency of Colne Valley. Within a week of one factory closing, however, a new purchaser was found for the factory and new jobs were introduced. Thanks to the help and support of the employment agencies, Kirklees council and Jobcentre Plus, each of those who worked in the mill were found jobs elsewhere. We could ask, "What is the problem?" For me, it is that the industry is still in decline. Last year's Red Book showed only two industries in decline—recession decline, not a slow down in growth—textiles and steel. That is important.

Textile production is still a major business in this country. It contributes 0.7 per cent. of gross domestic product, a fact that must not be ignored. People in the industry say, "If only we had the same voice as other manufacturers, we would be listened to." As it is, our textile producers are struggling, as are German and French textile producers. However, the Italian market is a completely different model. One of the TCSG's recommendations was that we should learn from the Italians' success, and I hope that the Minister will tell us today what progress has been made in that.

Huddersfield's Textile Centre of Excellence is convinced that we can learn a lot from the Italians. It found the Italian manufacturers to be especially helpful and forthcoming. They say that the key to success is co-operation and collaboration within the industry. I despair of some mill owners in my constituency. I do not believe that they have the right frame of mind to be able to collaborate with others. A sense of isolationism and a bunker mentality persist in some sectors.

In Colne Valley, there is a wide range of textile producers, making knitted garments, frilly lacy things, haberdashery, heavy woollens and carpets. We have all the flavours of textile production. We also have the patriarchal background of the industry, which results in producers not talking to one another for fear of people finding out what their company is doing and how it is performing.

Happily, not all producers are wedded to the past and there are good stories to tell. However, some producers still resist trade union membership, and an attempt to get trade unions into some factories failed abysmally. There are those who do not want to fill in DTI forms because they find them too difficult; those who do not want anyone else to know the background to their business; those who still have looms and machines that were built in 1947 rather than 2002; and those who have not invested in new design or produced anything different in the past 50 years. For those producers, the future will be very grim indeed. The industry must adapt and change and the Government must be aware of how they can help the industry to do so.

Money can always help, but how it is spent is crucial. I cannot argue with the Government's investment of £80 million in the industry since 1997, or with the £8 million that was spent between 2001 and 2002 on market development, employment training, the supply chain, design skills, e-commerce and export support. All of that is good; but I question whether we have gone far enough.

The problem for many producers in Colne Valley is that many schemes apply only to certain areas—in particular, to objective 1 and 2 areas. At present, Huddersfield's Textile Centre of Excellence is developing a local action plan. The centre needs to extend its premises, for which it has received £500,000 from Yorkshire Forward, the regional development agency, but it cannot go ahead because of state aid rules. Development in Colne Valley is being stymied. Many businesses in Colne Valley are in exactly the same position as businesses that are inside objective 1 and 2 areas. Their market conditions are the same; the conditions inside the companies are the same; the sort of help that they need is the same; and the population of workers is the same. However, they are outside the boundary and therefore not eligible for some of the support and help that is available to other companies. Producers feel that the system contains inequities—inequities that have arisen because of the rules, so those rules will determine which businesses will survive and flourish and which will fail.

The DTI is reviewing the 183 different kinds of funding. It is sometimes difficult for people in the Department to remember and understand 183 different kinds of funding, let alone the poor producer who is trying to decide which particular funding the business should apply for. It is no wonder that people sometimes do not receive the help that they might have received or do not know exactly where to go to get help, or that they apply for the wrong help or in the wrong way, and therefore fail. I hope that, during the Department's review, a sensible and simplified way can be found of allowing all producers to receive the help that they so desperately need—especially in investment. The system is a minefield that results in companies putting in a great deal of time and effort filling in forms, only to fail at the end.

I wish to thank the Textile Centre of Excellence in Huddersfield, because it provides an excellent service to local companies by visiting them and helping to fill in the forms, but firms have ask for such help, and often there is a divorce between the help available and the mentality of producers who will not always seek it. Frankly, the system should not be so difficult in the first place.

I hope that the Minister will understand how textile businesses work and how difficult it has been for them during the current grant aid review. The industry seeks not only a level playing field in Europe, but throughout the world. Doha rightly points out that western industries cannot succeed by ensuring third-world failure, and I hope that we all accept that developing nations must be on an equal economic footing to be able to work their way out of poverty. It must therefore be right for British and other western industries to compete not on the lowest common denominator, but on quality.

If the industry is to be supported, however, artificial barriers must not be constructed against British textile exports. For example, in evidence from the International Monetary Fund to the Treasury Committee recently, we discovered that the United States applies for export barriers as if it were a third-world nation. One throws up one's arms in horror to think that the US considers itself to be a third-world country when it comes to export barriers. It cannot be right.

Huddersfield's Textile Centre of Excellence can provide a good model for the rest of the industry. It can show how we can move it forward into a new millennium, leave some traditional, backward-looking thinking behind and build a new and innovative industry. Yorkshire Forward has contributed a budget of £963, 000 over a two-year period. Not all of that will be spent in Huddersfield, but a large amount will be spent in west Yorkshire, as that is the base of the Yorkshire textile industry.

The Textile Centre of Excellence has a seven-point plan that builds on the proposals in "Making it Happen", a report produced by the TCSG, for which I am grateful. But there is a plethora—I have brought only a small number of them as an example—of different reports and plans from different parts of the industry. Different organisations represent different bits of the industry that have grown over the years.

The first—and, from looking at the wide range of reports, the most essential—part of the plan is to bring all of the strands together. The industry needs a single voice. Disparate and separate voices can cry lonely into the wilderness, but by speaking with a single voice, representatives could create the same volume as other industries, such as the car manufacturing and energy industries. According to the December 2002 labour market count, the industry supports 430,000 jobs overall in the UK and should be considered a major employer, especially if the industry speaks with a single voice.

The second strand to the plan is to develop a Yorkshire label. We should be proud of the products that we sell, but I recently visited a factory with excellent quality woollen products that were being sold as Scottish. I am told that the wool came from Scottish sheep, so it can be argued that it was ethical, although there were some pretty good Yorkshire sheep grazing nearby. Nevertheless, the company preferred to sell its product as Scottish. That must be wrong. There is nothing wrong with the Scots being proud of their product, but why are Yorkshire producers not proud that their products are made in Huddersfield or Yorkshire? It is something that we must change. If we are not prepared to go out in the rest of the world and to be proud of the product that we are selling, why should the rest of world be proud to buy it?

I agree with the hon. Lady, who makes the point eloquently. That is true within various parts of the United Kingdom, but it is also true of international intellectual property rights. Perhaps the Department could spend a little time ensuring that those rights, which exist throughout various parts of the United Kingdom industry, are protected globally.

The hon. Gentleman makes an excellent point that I could illustrate by describing a movement from woollens to technical textiles in my constituency. A manufacturer succeeded in registering a product but because of market conditions and because it required investment in new machinery and meant applying for grants, the owner decided to close the business. I was particularly concerned when his son took it to Africa. I do not object to the growth of businesses in Africa, but the new product could have been developed and made in Britain. The product—it is called Leospring; look out for it because it is excellent—could one day change how we address ecological problems, such as oil spills, and it does not produce smoke, so imagine the difference that it could make if it were woven into the seat coverings of planes. It is an outstanding technical advance for textiles, and we have lost out because it will not be made in Britain. I hope that the product will be made one day because it will give advantages to us all, but it is a real pity that it could not be made in Britain.

That leads to the third strand of the plan, which is skills development, because we could not invent or produce such fantastic products as Leospring without skills. However, there are several gaps in the development of skills in the textiles industry. The Government have invested £2 million in strategic training for the apparel and textiles project. That project was widely welcomed but it ended in June this year. Many organisations, including the TGWU, are calling for an extension of the STAT project. However, in Huddersfield at least, there has been a response to fill the gap. I am delighted that we have excellent facilities in the Textile Centre of Excellence, which the Secretary of State visited when she was the Minister with responsibility for textiles and e-commerce. The centre is now developing a craft entry training course and we hope that that will be validated soon. It has used an investment of just £120,000 to start to teach students several of the craft-based skills that they need to enter the industry.

We cannot continue to be backward looking. If any hon. Members present were to visit a local textile business, they would find that many people working there would be over 40 or, in many cases, over 50. It is very difficult to find any 20 to 30-year-olds working in mills. However, I am pleased that young people are now coming straight from school to train in the field and that there are new links with universities. There was a time when universities withdrew their training courses in textiles. There is now a development of links between the local university and the centre of excellence to provide degree-level courses, which must be right.

That brings me to the futures programme, which is the fourth part of the plan. The Department of Trade and Industry has agreed in principle—so I hope that it is not improper to say this now—to give £309,000 to a scheme that will cover west Yorkshire, the north-west, the north-east, the east midlands and Scotland. The scheme will allow companies to be selected for a one-year programme during which they will receive the expert advice that they need but cannot usually afford. People from the companies will attend seminars with experts at least once a quarter in order to receive the advice and mentoring that they need to keep their businesses on track and up to date. Additionally, grants of between £15,000 and £20,000 are available as cash for participating companies to help them to develop and grow. The object of the plan is to take companies out of the past, and to encourage a movement away from old-fashioned practices and toward the use of modern production techniques. That will secure the future of the industry.

The fifth and most exciting part of the plan is the incubator unit. A thousand fashion and design students graduate each year in our area—20 per cent. of the United Kingdom total. Hardly any of those graduates stay in Yorkshire; most of them go to London, or go abroad. The centre is now working with the universities and is helping graduates to create their own start-up businesses.

Too many of the catwalk shows have featured quite mad designs that no normal person would want to wear, with models walking down the catwalk wrapped up like Christmas turkeys. We want to buy well-tailored, well-designed, wearable clothing, in which we can go to work and in which we feel comfortable when we go out in the evening. We do not want clothes in which we would feel uncomfortable even when sitting down. We need designers who stay close to producers and work with them to produce a synergy between good quality cloth and good quality design. Accordingly, the centre provides work space, help with portfolios and the technology with which to produce computer-aided designs. The centre intends, through the use of local market intelligence, to set up 12 companies each year. Those could grow design and fashion knowledge that is useful to the industry and create a local outlet for the industry's product. No more should we have to go to the south, or abroad. Let us keep our good designers at home.

The centre is also part of the manufacturing leadership programme, which is developing qualifications in manufacturing to degree level. That is not specifically an innovation of the textile industry. It is important for the textiles industry that students understand that manufacturing is a business and that they develop the leadership skills that are needed by all manufacturers. I would recommend that programme to anyone from Yorkshire who is listening. My copy of that programme shows that each faculty should work with the universities and with companies to develop the leadership skills that are obviously needed and to break out of the bunker mentality that we have been used to. The industry is also a significant consumer of energy and it has found it difficult to respond to demands for reduced energy consumption. The industry does not want to be anti-ecology, but it finds the climate change levy particularly onerous.

I have in my hand a note from the Textile Services Association, which is a vital part of the industry. The industry uses a lot of energy and water, from the beginning of the production process, in all its component parts, including laundering, right up to the end. The industry also uses many chemicals in its production processes and it is right to try to control the effects of production on the local ecology. It can, however, be costly for a producer if it has worked hard to reduce its energy consumption but cannot recoup any of the costs through national insurance contributions. The Textile Services Association will attest to that. The centre of excellence, however, tells me that it has been able to help in many cases and has shown some factories how to reduce both consumption and production costs. Much has been learned, but there is still a lot more to do.

The Textile Centre of Excellence has £160,000 to spend in the region to show companies how to respond to the climate change levy. Companies tell me that they are finding it difficult to save money, but the centre says that it can help. The levy needs closer consideration and it should look at it in more detail, so that we can help companies through a period in which we expect them to adjust.

Yorkshire Forward has made available just £150,000 for innovation, and £80,000 has already been allocated to one company, but at least that money is being made available. I have already mentioned the product called Leospring, which, sadly, Huddersfield lost. Such products must be given some support if we are to develop them. If there is to be innovation, there must be support, otherwise there will be a sad lack of innovative products in our country.

I discussed the future of textiles with Bill Macbeth, the outstanding managing director of the Huddersfield Textile Centre of Excellence. Hon. Members can tell from my speech how much I admire the work of that body. Bill Macbeth says that we must change our attitude to textiles. He has certainly inspired me. He says that textiles is a sexy industry. I was not sure whether I would be allowed to say that, but I have done so now. That sexy industry—I think that I would prefer to call it exciting—should be forward looking. If the industry drags its heels, and comes kicking and screaming into this millennium, its future will be bleak. However, if the industry is backed by the Government, as is recommended in "Making it Happen", and if the industry co-operates and meets the challenges of a modern world, its future could be secure and exciting. I, for one, hope that it will be.

I congratulate the hon. Member for Colne Valley (Kali Mountford) on securing the debate and on speaking so eloquently in defence of a beleaguered industry. She must have read Hansard before she became a Member of Parliament, because her predecessor, Graham Riddick, was a great champion of the industry, too.

I am interested to hear that the hon. Lady regards the industry as sexy. When I first went to Hinckley in my constituency in 1987, I was invited to attend the "Hinckley Makes It" show, and I was somewhat surprised to see some of the ladies from the factory modelling the local products. I expressed my surprise to the organiser of the show, a lovely man who played a great part in the local industry, Mr. Bill Randells, and he said, "David, you must understand; Hinckley makes progressive underwear." I am not sure what should be read into that.

The Government's approach to hosiery, knitwear and textiles closely mirrors the No. 10 press office—both are totally out of control. I shall not indulge in a lot of corny puns on spin and spinning, but if ever there was an industry to which the maxim of all spin and no delivery should be applied, it is this one. I see the Minister smiling and moving around in his seat; perhaps he is feeling uneasy. He must know, in his heart of hearts, that the Government promised so much for the industry when they came to power, and they have done so little.

Will the hon. Gentleman give way?

I am pleased that, within 10 seconds, I have provoked the Minister.

I wanted to clarify that that was not why I was smiling; I had just been given a definition of progressive underwear by someone behind me.

I am fearful of being called to order, but I could perhaps say a little more to the Minister on that subject later.

I am entertained to know that I am speaking before the cashmere kids. I had never heard that term before, and I did not realise that the cashmere industry had an informal group dedicated to its support that goes by that name.

I represent a famous hosiery and knitwear town in the east midlands, Hinckley, which at one time had 150 factories. It used to have perhaps the highest income per family in Europe, because all the ladies of the town worked in the factories, and many of the men crossed the Waling street boundary into the west midlands to work in the car industry. The textile industry is still thought of as a key industry in Hinckley and the east midlands, but it has suffered grievously. The hon. Member for Colne Valley correctly reported that 90 per cent. of the delegates at a recent conference talked about the closure of mills. The terrifying fact is that, whatever the Government say and whatever great schemes they introduce, when one says "Where's the beef?" there is not any. The industry is all closures, it is all downhill, and that is the Government's fault. This Government are entirely responsible for the decline of this industry, regardless of how many reports they publish.

rose—

I shall give way to the hon. Lady, whose constituency was represented by an eminent Conservative, Phillip Oppenheim, before she took it over.

Would the hon. Gentleman care to tell us how many jobs were lost in this industry under the previous Conservative Government?

It is an old technique of parties in Government to try to blame previous Governments for their own misfortune, but one would have thought that a Government who have been in power since 1997 could do better than merely blame the previous Tory Government, because the fact is that they have done next to nothing for this industry.

There have been many reports; there is another one this year. Fludes is a factory in my constituency. The Secretary of State, the right hon. Member for Leicester, West (Ms Hewitt), paid a surprise visit to Fludes, a factory in my constituency, to help to promote the innovative socks that it is making for travellers who might suffer from deep-vein thrombosis. [Interruption.] I am not so uncharitable that I will not also mention the hon. Member for Leicester, East (Keith Vaz), even though he does not represent my party. During the visit to Fludes, the managing director of the factory said that the Government put all the emphasis on the relocation of employees after they have lost their jobs. They are backing other industries, and nothing is being done to keep the jobs that exist in this industry, which is why we are seeing this catastrophic decline. The industry is in a very serious situation.

The hon. Member for Colne Valley mentioned the export of jobs. When Pex in my constituency shut down, the idea was that all the equipment would go to Romania. We are suffering from an export of jobs. One of the reasons for that is that it is almost impossible for companies to reinvest—to bring in the new machinery that the hon. Lady so eloquently said that they need—because they are not receiving any help from the Treasury. It also provided absolutely no help to the Textile Services Association when it made representations about the climate change levy. The association said:

"The submission by the industry to the Treasury was summarily dismissed despite having held face to face meetings with the Minister."

That reveals that this is all about saying one thing and doing another. That is disgraceful. We need a coherent, determined and meaningful effort to reverse the trend of decline in this industry. I have no doubt that the textile clothing strategy group's efforts were well intended and that they have alerted the Government to some of the problems that exist, but no meaningful action has been taken.

The industry must get added value for products: that is the way forward for it, but to achieve that it will need more equipment. Some companies in Hinckley, such as Davenports, have made great efforts to bring in new equipment at great expense—without any help from the Treasury—so that they can compete with the Italians, who are very effective. That is how the industry can move forward—by adding value.

Some companies in Hinckley are now having to outwork in China. They make some products there, and then bring them back and re-label them. It is regrettable that that has been the way forward for some companies, but at least they are still in business.

Courses at North Warwickshire and Hinckley college have been shut down: the ones that used to train the mechanics who maintain the equipment have gone during the tenure of this Government. The overriding problem is that too much emphasis is put on helping those who are leaving the industry, and not enough is put on helping those who are in the industry and who want to stay in it, and on creating new jobs.

Will the hon. Gentleman give way?

I will finish now.

I am very disappointed by the contribution of the hon. Member for Bosworth (Mr. Tredinnick). I had no intention of getting into a party political debate; the situation is too serious for that.

When the Conservatives were in government, half a million jobs were lost in the industry and no action was taken to bring the parts of the industry together to try to develop a strategy for the future. We are going through a period of incredible globalisation and industrial change—a new industrial revolution. I will come back to that point.

Yesterday, I spoke with Julian Ellis, who chairs the group under the east Midlands regional organisation that looks after the technical textile sector for the industry. He said that the Government could not be doing more, and that it is now up to the firms in that sector to take action. We are going through great difficulties, and now is not the time to talk about party political issues. The textile and clothing strategy group was set up precisely because, after 1997, Ministers talked to different sides of the industry and said, "We cannot tell you what to do. Please come together and tell us what you need and your recommendations for where the industry should go." I hoped that the hon. Gentleman would at least recognise that, because I wanted to start by paying tribute to the group's work. It is a model partnership between trade unions, employers, trade associations and academics working with, and supported by, the Government.

Despite the many problems, the group has produced 55 recommendations on how to take the industry forward, and the Government seek to support those. Things are difficult, but we all know that. In our east midlands region, structures have been set up to assist development of the industry. However, after the national strategy was produced, some hon. Members in the region had to talk to the key players and argue with the development agency to take the strategy on board and to do the work that is now taking place. I thank the officials in the unit at the Department of Trade and Industry, who are very helpful and doing a great deal of work to advance the recommendations.

As I said, we have many difficulties. We face a global problem and a change in the operation of the industry. It is the job of those participating in this debate and those of us in the all-party group to stress that the industry has a future. That was one of our main purposes, in addition to ensuring that we had a national strategy and that action would be taken on its recommendations. That is why we are here today.

The industry is still important. As my hon. Friend the Member for Colne Valley (Kali Mountford) said, it still accounts for 0.78 per cent. of gross domestic product, £15 billion in sales and £6.5 billion in exports, and it employs 250,000 people, so it is still a key player in this country. However, the industry does not have the profile that it should have, and part of our job is to ensure that it has that profile.

The industry is having an incredibly difficult time. Some 75,000 people work in the industry in the east midlands, and there are 2,500 companies, but we have lost 20,000 jobs in the past 10 years and we lost many more before then. We recognise those problems: I believe that the constituency of every hon. Member present has experienced pain as a result of those difficulties. We are going through a relentless globalisation process, and it is very difficult to compete internationally. We must consider those areas where we can still compete and find new ways of competing, new products and new sections of the industry. We face competition and the removal of tariffs, which is a very hard process.

This Thursday, I hope to attend a farewell function for many of the people who are to lose their jobs at a Richard Roberts factory, which is just up the road from where I live. It is a former Charnos factory, and the factory manager lives just a few doors down from me. The hon. Member for Bosworth spoke about the help that is given to people who lose their jobs. Like my hon. Friend the Member for Colne Valley, I pay tribute to the work that Jobcentre Plus has done, because most people from the factory have managed to find new jobs.

Interestingly, the only factory that Richard Roberts maintains in the region is the one with a niche market—the firm in Kirkby in Ashfield that makes cashmere products that are sold to Saks Fifth Avenue. That is the only factory where the company can maintain a high-value product in this country and still compete. This is a serious problem: how can we transfer to new areas, where competition can still exist?

Many of the traumas in my constituency came with the job losses at Coats Viyella. In September 2000, we lost 5,000 jobs across the region, which caused us serious trauma. A major economic driver in my area over the next few years will be the development of the world heritage site in the Derwent valley. Ironically, that was the heart of where the Arkwright and Struts mills were and the real start of the industrial revolution. We are losing jobs in this sector while praising, applauding and developing tourism and economic growth based on the area's world heritage status granted in recognition of the industry's past. It should make us think about where the industry is going. Attempts are being made to protect and assist companies presently in production, but we also need to move into new sectors: we are on the brink of a new revolution within the industry.

Technical textiles are a particularly important sector and we should recognise that we are world leaders in it. I have recently had the sad job of talking to people who are losing their jobs in one traditional part of the industry that has been unable to compete. By contrast, last weekend I went to see the latest James Bond movie: Nottingham university was consulted about the Aston Martin car's amazing trick of turning over a million times on the ice. A technical process within the textiles industry—a 3-d braiding process—was used to create and strengthen parts in the chassis of Bond's high-performance car. That lies behind the thrills and spills of the James Bond movie and highlights the important work of our local university. One hopes that the process will be used in other cars to make them safer.

Will the hon. Lady acknowledge the great promotional tool of the latest Bond movie for the entire textile sector, recalling that the cashmere sweater worn by Bond comes from Ballantyne of Innerleithen?

I will certainly acknowledge that. Yet another aspect of that enjoyable movie is that it features a female spy who is as good as James Bond—and the baddie came from the east midlands, too. The movie is good for demonstrating many things.

Staying with cars, when I first visited Advanced Composites in my constituency, I was amazed to hear that all its material for Formula 1 cars was textile-based. I found it hard to believe, but that is indeed the case, and it shows another important application of the textiles industry.

I mentioned earlier the chairman of the group of technical textiles companies in the east midlands. Those companies are involved in the production of surgical implants, which utilises historic embroidery techniques. His company is also taking part in a £1 million Government-funded project examining urinary incontinence: it is producing a collapsible tract to be inserted into people's bladders to facilitate the use of catheters—yet another example of extraordinary and amazing developments from technical textiles. As I said earlier, the company felt that the Government were providing help through the TCSG. Will the Minister give an assurance that continued funding will be available to that important sector, which should not be allowed to fall short because of lack of investment?

Many positive developments are taking place within the industry, but I have some questions about how best to implement the recommendations in the report. People in the industry have asked me to put some questions to Ministers. First, the relaxation of the three-times rule is welcome, but what action is being taken to clarify the rules for 2003–04 to ensure that people can take advantage of international trade fairs, which are so important for export sales? Although the rule has been relaxed for this industry, the amounts that can be used for export fairs are still capped.

Secondly, on public procurement, the Government have been seeking to make the rules more beneficial to British companies. However, all too often there is a feeling that price rather than quality is being considered—I have been given the example of blankets provided for our troops by the MOD. There is also a question of transparency in the tender process in this industry and elsewhere. People do not know, for example, how to get on to the approved list for tenders.

The subject of my third question—the STAT programme—was referred to by my hon. Friend the Member for Colne Valley. I am delighted that the industry has done so well in achieving trailblazer status for the sector skills council. That is a great tribute to the work done by partners in the industry, but we still want the STAT programme to be continued. It could be a model for other industries; it is employer-based and has enabled companies to work with business advisers to establish their training needs rather than having to adapt their training to the courses available. Some 91 companies have benefited; 1,800 jobs have been secured, 2,500 employees have new skills, and new jobs were created in 41 per cent. of the companies involved.

I would be pleased if the Minister could clarify the follow-up scheme. I tabled questions to the three relevant Departments, and was disappointed that one of them—not the Minister's—told me that we did not need the STAT programme now that we had the sector skills council. The reality is quite the reverse: the council needs to be able to promote and develop this flexible programme. I would also like the Minister to give a commitment on its funding

I have also been asked what happened to the designer study. Earlier this year at London fashion week, which I attended, the Secretary of State for Trade and Industry launched a study of the fashion design sector and its impact on the wider textiles and clothing industry. Is that being taken forward, and what help is available for it?

The Minister responsible for the textiles and clothing industry recently re-launched the second phase of the designer forum in Nottingham in the east midlands, which provides facilities and information for designers on fashion trends, start-up units, incubator units and so on. It would be helpful to know how that ties in with the study that Ministers are conducting.

On my next point, I understand that the joint industry fashion team was a Treasury initiative to encourage and help companies to move from the informal economy into the formal economy, and to let them know that they would not be closed down because of previous problems of taxation or the minimum wage. The Evening Standard has reported recently on how Arcadia—a company that has been very involved in Government projects in the industry—was found to have been taking goods produced in sweatshops by workers receiving less than the minimum wage. The initiative is therefore very important.

I reiterate some of the frustrations that my hon. Friend the Member for Colne Valley expressed at the start of the debate about business support and the difficulty in accessing funds in areas not obviously eligible for objective 1 or 2 funding. Stevensons Dyeworks, a company that has been involved with some of the Government programmes and is now part of the Quantum group, is concerned about the rigidity of the rules for applying for financial assistance. It is frustrating for that company, which is in a ward in my constituency that was expected to move to tier 3 status. Had it done so, it would have been eligible for some grants, but that has disappeared from the agenda while the review of business support is conducted.

Stevensons raised with me the difficulty of ensuring coherence in the programmes that we are developing in our regions and hoped that the strategy developed by the clothing and textiles group would be taken forward. A considerable amount of work is now being done in my region and in that of my hon. Friend the Member for Colne Valley to set up structures to co-ordinate the work that is being done in the industry. However, it can still be confusing for companies in the region to work out exactly how they access that help, and it is important that we provide that information.

I shall end with an example that illustrates the need to take the industry forward. The person who chairs the east midlands cluster within the region runs a company called Swiss Tour, which manufactures specialised netting, from mosquito nets to parachute lining. It even produces netting that can block mobile phone calls and other wonderful things. Interestingly, that technology has been developed from Nottingham's old lace-making machines, which were invented two centuries ago to replace hand lace making. The problem is how to move on from traditional manufacturing while keeping as much of it as we can. I agree with the hon. Member for Bosworth that that means not just giving assistance to those who lose their jobs, however important that is, but also seeing what can be done to make companies move into new niche markets and areas where they can compete. We can assist them in that, but we also need to keep our eye on the current industrial revolution, which can take us into a new sector in the future. It will probably not be called "textiles". The technical textiles people are setting up their own trade association. It is doubtful that people will realise that many of the products are based on textiles technology, but that is how the industry is developing. There is a huge amount of work to do and a painful process to go through. I hope that the Minister can deal with some of the points that I have raised.

This has been an important debate and I congratulate the hon. Member for Colne Valley (Kali Mountford), my colleague on the all-party group on clothing, textiles and footwear, on securing it. I pay tribute to the hon. Lady for the work that she does on the Committee and to the hon. Member for Amber Valley (Judy Mallaber), whose chairmanship of the group makes it highly effective. The hon. Lady has kept us focused on the activities of the textile sector for the past few years.

I am glad that the Minister is in his place. He dubbed my hon. Friend the Member for Roxburgh and Berwickshire (Mr. Kirkwood) and I the cashmere kids, I presume on the basis of the work that we did during the banana war that threatened to wipe out the cashmere industry in our part of the world. If we are the cashmere kids, perhaps the Minister is the class monitor, because he put in a great deal of effort at the time addressing a huge public meeting in Hawick, where people were very anxious about the future of the knitwear industry. On a separate occasion, without any publicity or attention—and, dare I say to the hon. Gentleman's civil servants, without any support whatever—he met manufacturers in Hawick to talk about the threats to the industry. I pay tribute to his work and I look forward to his response to the debate.

For all the pessimism that exists in the textile sector, it remains one of Britain's strongest manufacturing sectors, especially in my constituency. It is a vibrant sector that needs to succeed and I believe that it will do so, through innovation and by enhancing its competitiveness. There is no doubt that the textile industry has a future. I worry that in the House and in other forums we are tempted to talk the industry down and look for problems, which are self-evident and present in most manufacturing sectors. The textiles industry still has a huge impact on the economy and without it south-east Scotland and the borders would be in great difficulty.

The main aspects of the textile sector, be they knitwear apparel, weaving or technical textiles, are represented within south-east Scotland. Each of them has seen huge changes in recent years. Over decades, the nature of the competition faced by individual companies in the United Kingdom, especially from overseas, has changed out of all recognition. Inevitably, that means that regardless of the state of the world economy or particular parts of it, the sector will always be subject to the buffetings of the world economy with the extreme competitiveness that that introduces. Globalisation may be a reasonably recent concern for people across the world, but the textile sector has coped with it for a hundred years or more. We must not shy away from the challenges that it faces, nor should we worry that the only route is downwards.

The marketplace has changed. That has been noticeable in many of the products that are produced in my constituency. There has been a shift in recent years towards the different niches of the market. For example, the cashmere sector has moved to the high fashion end of the market. As a recent local trade publication put it, borders manufacturers no longer sell just gold button cardigans and twin sets. I take slight issue with the hon. Member for Colne Valley, who talked about the catwalk and asked whether it was relevant to everyday people. It is relevant in that it shows how design and innovation is increasingly important for British companies, particularly those that I represent. It may not be the stuff that anyone here might want to or could wear, but it shows what the industry can do and it spills out into the more mainstream markets that we see as important commercially and otherwise.

Does the hon. Gentleman recall the sort of catwalk shows that there were in the past? One of my favourite designers was Paul Costelloe, whose fine tailoring was very innovative. It may have been a little extreme for the average person, but it was wearable clothing rather than the tinfoil effect of some of the current designers. Would not that inspire people to wear new fabrics?

I am getting a little out of my depth as a fashion consultant or guru. I defer to the hon. Lady's greater expertise. It is important that the industry shows off the best of its potential in whatever sector. I hope that it will continue to do so. My constituency does not just produce high fashion cashmere. We also produce goods in a diverse range of fields. One small manufacturer, Robert Noble and Replin Fabrics, makes aircraft seat and carpet fabrics that go into Boeing jets throughout the world. Too few people in the borders understand that, let alone elsewhere. It is a good example of a small company that has diversified and is reaping the rewards as a result.

My hon. Friend the Member for Roxburgh and Berwickshire and I recently carried out a survey of local manufacturers, and the textile sector obviously featured heavily. The techniques that manufacturers have to adopt nowadays range widely across the spectrum. Some seem still to be living in a 19th century museum but others are state of the art and software driven and are unrecognisable from earlier days. Each company has its niche and each has its expertise, and the importance of investment for all of them needs to be stressed.

One of the key issues facing all of these local businesses, regardless of their sector or their manufacturing base, is the need to encourage young people into the industry. The skills shortage in the textile sector is massive. A recent report in the borders entitled "Where are the young people?" put its finger on the dangers facing the local industry. It will not run out of customers or struggle with cash flows: it will have no one to employ. That goes back to the point with which I started. Part of the difficulty is not that there are no young people, although that is an increasing problem in the borders, but that they do not like the image of the industry. They are not happy with the one that is portrayed in public. All of us here and elsewhere have a responsibility not to talk the industry down, but to promote it so that young people and others can see a viable future in it for themselves.

Further applications for research and development will ensure success in the future. Heriot-Watt university in my constituency successfully took part in the Faraday partnerships. It has undertaken much research that, it must be hoped, will be recognised for its academic excellence and will spin out into industry. It is clear from the university's recent briefings that the work that it is doing is highly respected. My anxiety, however, is that it does not generate the spin-offs of new jobs and new markets for businesses in the borders and elsewhere in Scotland. So far, that is the missing link in the partnership, and I hope that the Government will encourage Heriot-Watt university and others to work more proactively to ensure that there are local spin-offs from the excellent work that they are doing.

Time is running short, but I return to the point to which I referred obliquely. I draw the Minister's attention to the importance of world trade to the industry, and to the need for fair rules of competition. We all acknowledge that the multi-fibre arrangement is coming to a close. Every business has had the past 10 years to prepare for that. The Doha round is extremely important for setting out the new rules for the future. However, I ask the Minister to ensure that when the rules are drawn up we do not suffer from dumping, especially from China with its access to cashmere supplies, into the United Kingdom, and that the monitoring and checking of the provisions that succeed the multi-fibre arrangement are vigorous and secure.

This is a very important debate on a very important sector. The strong have survived, and the strong who adapt to change will continue to survive for a while yet.

I congratulate the hon. Member for Come Valley (Kali Mountford), who made an effective case for her constituents. It was also heart-warmingly positive, forward looking and outward looking—not the face of the textile industry that I have experienced. In the 1970s and early 1980s, I worked with developing-country negotiators to try to help them to receive better quota treatment under the multi-fibre arrangement. In those days, the face of the British textile industry was very different; it was defensive, inward looking, and obsessed by external competition and by building barriers to it. Courtaulds and Carrington Viyella were investing heavily in upstream weaving and spinning and in trying to secure quotas to protect their industry. The face that the hon. Lady presented today was altogether more positive and forward looking, which I appreciate.

The hon. Lady and other speakers helpfully highlighted the extent to which we are dealing with a diverse industry. We can argue that the textile industry is, in a sense, merely a lobbying group. It is very diverse with very different sets of problems. There is an enormous difference between, for example, upstream spinning and weaving, which is capital intensive, and the garment makers.

The knitwear industry is a different story; Members representing the east midlands and the Scottish borders spoke about its importance. Even in that industry, the knitwear producers are very protective of their sub-industries. The people who make socks and stockings have little to do with the people who knit garments and who use different technologies and materials. In view of such diversity, it is useful for us to remind ourselves, as several hon. Members have done, that it is not all doom and gloom.

There are some very positive stories in "the industry". The hon. Member for Amber Valley (Judy Mallaber) reminded us of the success of industrial textiles, especially household furnishings. Many people in niche markets in the garment sector, which 20 years ago seemed a hopeless case, are doing very well. My hon. Friend the Member for Tweeddale, Ettrick and Lauderdale (Mr. Moore) rightly reminded us how innovative and successful Scottish producers in the cashmere sector are proving to be. They are using new designs, new technologies and better materials, which is how we should view the industry.

The same applies to the communities. As a teenager, I went round the West Riding playing and watching football and rugby league. It was often depressing going to towns such as Batley and Halifax, but they are now totally transformed. The area around Leeds is now a prosperous, successful and vibrant economic area. The area, and not just the textile industry, has adapted extremely well to relative decline. The story is not all doom and gloom by any means.

The figures clearly show that the textile industry is in relative decline. That is nothing new; it has been in relative decline for 150 years. However, that is not surprising because it was the industry that led the industrial revolution. It has been declining relative to the economy as a whole and relative to manufacturing, while other industries have gradually replaced it.

Over the past few years the contraction of output has speeded up. This is not to apportion blame, but that contraction is probably because of the exchange rate as much as anything else. When the exchange rate has appreciated by roughly 25 per cent. in real terms since the mid 1990s, and when many parts of the industry are concerned with competition in exports and imports, and are very price-sensitive, prices and the exchange rate will clearly be important. I suspect that the exchange rate is the factor that most explains the increase in the pressures of competition on the industry. However, even if that exchange rate factor did not exist, globalisation would still be a factor bringing its own pressures, as the hon. Member for Amber Valley reminded us.

I wish to discuss two policy issues. The first concerns trade policy. There is now consensus that the MFA has to be phased out. However, it is worth while reminding ourselves what a pervasive influence trade protection has had in the textile industry. That goes back a long way. Those who know their economic history will know that the first big industrial riots in London took place at the end of the 17th century just before the reign of Queen Anne. The riots were over textile imports. The whole of Whitehall was burned to the ground by rioting workers demanding controls on calico imports from India. People protested about the unfairness of so-called coolie labour—cheap labour. They demanded, and got, quotas. That remained the nature of British industry for many decades, only dying out for technological reasons.

We have had quota protection in British industry since the early 1960s. The long-term agreement became the multi-fibre arrangement in 1974. We were told that that was temporary and that only a few years were needed to get the house in order. Then, in 1979, it was multi-fibre arrangement 2, and things were extended and extended. It is worth while remembering how unbelievably complex the system is. Apart from the common agricultural policy, it is the most complex system of managing trade in the world. There are hundreds of clauses for hundreds of countries and categories of products. Indeed, apart from Gosplan, it is the most managed system of international trade that has ever existed, and it is right that it should go. The lesson has been that, when trade is protected, as in the MFA, it is very difficult to get rid of it. Moreover, in the long run it does not work. All the efforts that have gone into protecting the textile industry in rich countries ultimately turn out to be futile. There have been many successful companies but they are not in the sectors that were protected against import competition. The exercise was largely futile and immensely costly. I hope that the Minister will confirm that the Government are committed to working towards the phasing out of the arrangement. I understand that the commitment is to phase out the quotas but that that commitment is, in the jargon, back-end loaded—it will not take place until the end of the process.

As my hon. Friend the Member for Tweeddale, Ettrick and Lauderdale pointed out, elements of genuine unfairness remain. There are problems with dumping and a lack of reciprocity, especially with the United States. It is right that the Government should be vigilant on those issues.

The second policy issue that I wish to discuss concerns industrial assistance. What is the most sensible and helpful way in which the Government can help an industry that is trying to adapt in difficult circumstances? There are basically two ways. The first is through subsidies and industrial assistance. A lot of money has gone into the textile industry. I think that about £100 million has gone in during the past 10 years, and an awful lot more went into Lancashire and Yorkshire textiles in the 1970s. I am sceptical about the value of that assistance and I should be interested to hear any evaluation that has been made of the outcome. However, I welcome the more useful, subtle and forward-looking approach adopted in the 12-point programme. Those measures are extremely well thought through, sensible and business oriented. They bring the industry together in a sensible way and I commend the people who put the programme together. It is the way in which a forward-looking and outward-looking industry can prosper.

I congratulate the hon. Member for Colne Valley (Kali Mountford) on initiating the debate and on her well thought out and extremely impressive contribution. She described the decline that the industry has faced, which has been relentless. In the past 10 years, whereas the growth rate in all industries has been plus 2.1 per cent., the growth rate in the textile industry has been minus 3.2 per cent. That has obviously been reflected in the number of jobs and the balance of trade. We have seen substantial decline.

The hon. Member for Amber Valley (Judy Mallaber) mentioned globalisation, but I was pleased with the amount of positive talk about the future in the debate and how we can move forward with hope. One of the biggest problems has been companies and manufacturers sourcing products abroad. More such sourcing abroad of the lower value, high volume goods—such as trainers and jeans—is inevitable. Companies have moved production to China, Africa and the sub-continent. Dr. Martens recently announced the loss of 2,000 jobs, which is devastating for the communities that supplied the labour for its factories.

The ladies' cardigan manufacturer, Dewhirst corporate clothing, announced the loss of 350 jobs last summer when it closed its plant and relocated to Morocco. An especially poignant and brutal truth was brought home to the workers in that factory because they were sent out to Morocco to help set up the factory and train the staff there. They then saw their own jobs exported.

The debate has rightly focused, however, on higher added value, lower volume quality goods. There is every prospect of many manufacturers of those goods remaining in the United Kingdom. The Government and the industry must work together to ensure that those things within the remit of the Government are moved forward constructively.

We should examine what the Government have done. My hon. Friend the Member for Bosworth (Mr. Tredinnick) was critical and talked about the lack of any determined, meaningful or clear strategy by the Government, but we should look at what they have done. The Opposition welcomed the textile and clothing strategy group report and the Government's response to it. We also welcomed the updated response that was published a year ago.

What are the Minister's comments on recommendations 1 and 2 of the report? Recommendation 1 states that the Department of Trade and Industry

"should press the European Commission to undertake a detailed study into the reasons for the relative success of the Italian clothing industry".

Recommendation 2 states that the Department

"should fund a study looking at best practice in the Italian textile and clothing industry and how it might be adapted to the UK."

Recommendation 6 states:

"The DTI should ensure that the availability of funding streams to support technological innovation in the textile industry is properly communicated to the industry."

Has any progress been made on that front?

The hon. Member for Amber Valley mentioned recommendation 19 and the suspension of the three-times rule for support to companies attending trade fairs, which is vital. I hope that the Minister will tell us what the Government will do to make matters easier on that front.

Recommendation 37 relates to the progress of the new centre of excellence and the need for it to be monitored closely and for its success to be built on. Will the Minister tell us what is happening about that? Recommendation 40 was that the Department of Trade and Industry should establish a flexible fund to support individual companies that undertake small-scale innovation and development work. That is very important, so will the Minister give us an idea of what the Government have done about that recommendation?

I am worried that although we have had a period of buoyant economic conditions and economic growth, manufacturing is undoubtedly in severe recession. It will become even more important for the Government to examine the recommendations and to ensure that they put in place anything that they can within their remit and resources.

There are other areas in which even if the industry is asking for too much positive help, the Government must not hinder it. The hon. Member for Amber Valley mentioned procurement, and I believe that the Government have positively hindered the industry through their procurement policies. I know that this is outside the Minister's remit, but there was mention of the procurement of Army blankets from abroad. Six months ago, an order for boots and uniforms was sent to a German manufacturer. I am aware of the EU directive that insists on fair and competitive tendering within the EU, but no other major EU country is sourcing clothing and kit for its armed forces from outside its own manufacturers.

Several hon. Members mentioned the climate change levy. I entirely agree with a point made about the Textile Services Association because the key question relating to the climate change levy is whether manufacturers can recoup the money through national insurance contribution reductions. If the answer is no, the Government should take action. Perhaps we should consider moving forward for such cases with an emissions trading scheme, which has been popular and successful on the continent.

Some burdens and pieces of red tape, such as EU directives and regulations, are outside the Government's control. However, the Government have been driving forward several pieces of social legislation. I do not claim for a moment that each burden and extra pressure will be a show stopper, but we hear from every single trade association in every single industry that the combined weight of the burdens on business is making life much more difficult.

During last week and the week before that, we considered two statutory instruments arising from the Employment Act 2002. One related to maternity and paternity pay after adoption, which Conservatives Members support, but last week we considered a statutory instrument on flexible contracts, which gives all employees the right to demand a flexible contract if they have a child under six or a disabled child under 18. That might not worry a larger firm but many small firms in the textiles sector will find it difficult to cope with demands from perhaps five out of 10 employees for a flexible contract. The employees might deserve a flexible contract but if firms are trying to meet an order in the run up to Christmas or another especially busy time, the smaller firms will suffer every time.

Smaller firms, especially, will also suffer from the agency workers directive. To be fair to the Government, they have done their best to resist and water down the directive. However, the directive will almost certainly go through. It has been passed by the European Parliament and it is now before the Council of Ministers. It will give agency workers—or temps—the right to demand a full contract. In fact, the European Parliament insisted that that right should exist after day one, but I know that the Council of Ministers is confident that it can extend the period to six weeks. However, even a six-week period will affect many agency workers. They will have the right to demand parity. It is sometimes easy to justify paying a temp as much as an employee on a full contract. However, there will be plenty of situations in which a temporary member of staff does not have the same experience or skills and who does not qualify in any circumstances for the same level of pay. Many people who work as temps are highly skilled and qualified. They do not want such contractual rights, nor do the employers. I urge the Minister to resist the directive. I know that his socialist colleagues in the European Parliament have voted it through, but I hope that hon. Members who know Labour Members of the European Parliament will talk to them about the damage that the directive will do to business.

The Government must look carefully at those areas within their responsibility that they can control and relieve some of the burdens and red tape. We can then look forward to a bright future. The key to such a framework is that the Government deliver upon it. I hope that the Minister will give us some hope in that direction this morning.

I add my congratulations, Mr. Cook, to those that have already been expressed to my hon. Friend the Member for Colne Valley (Kali Mountford) for initiating a debate on such an important industry. The subject certainly deserves an airing in Parliament. It is particularly welcome that she looked on the positive side of the industry. In fact, the whole tone of the debate has been positive, whereas so often in the past it has been a procession of doom and gloom. I come to the debate as a late substitute, but I have a long-standing interest in the industry and it is good to renew my acquaintance with such issues. When innocently fumbling with my tie earlier, I was relieved to find that it was made in Nottingham. I was surprised about that; it is my fig leaf for today.

It is worth bearing in mind that the textile industry is not a piece of industrial archaeology. It contributes 0.8 per cent. of GDP; it accounts for £15 billion in sales and it employs about 250,000 people. It is interesting that exports last year were to the tune of more than £7 billion. The hon. Member for Twickenham (Dr. Cable) made good points about the history of protectionism in the industry, but the other side of the coin—even in current circumstances—is that we sell £7 billion worth of goods from that sector overseas. It is the old story that protectionism cuts both ways and we need such markets just as other economies need our market. That is why my Department is committed to working with such an important and dynamic sector and helping it to remain competitive, both domestically and globally.

For the first time in a generation, there is an industry-led national strategy for the future of the sector, which has been drawn up by the textile clothing strategy group. It was established in 1999 to examine the major issues affecting the textile and clothing industry, and to identify actions that would improve its viability and competitiveness. The report was launched in June 2000. It contained several recommendations aimed at the industry and the Government to help the sector meet the global challenges that it faces. Since then, we have expanded our effort to address all the recommendations in the TCSG's strategy that called for action by the Government alone or the Government in partnership with the industry.

The group's follow-up report "Making it Happen", which was launched in July this year, records the actions taken by the Government and the industry to help United Kingdom textile and clothing manufacturers compete more successfully. They include £1.5 million towards a £3.8 million textiles and clothing industry forum programme, developing projects to promote world-class best practice to improve the performance of the industry throughout the entire supply chain; £2 million support to target retraining for the industry through the strategic training for an apparel textiles programme, with a follow-on programme now in the pipeline, and so on. I do not want to go through all 12 steps that the Government have taken because my 10 minutes would be up. I want instead to deal with some specific issues, Mr. Cook.

Order. I have allowed two such references to me; I cannot allow a third. When establishing this parallel Chamber, the House decided that the four senior Chairmen of the Chairmen's Panel should, while occupying the Chair, be addressed as Mr. Deputy Speaker.

I am sorry, Mr. Deputy Speaker.

My hon. Friend the Member for Colne Valley and the spokesman for the official Opposition asked about what had happened to the study of the comparison with the Italian industry. That is an interesting and important line of inquiry because Italy is not a third-world country that pays knock-down wages, and yet it has extremely successful textile, clothing and footwear industries. The TCSG identified that important lessons could be learned from studying that industry, and the Department of Trade and Industry has undertaken a comparative study of the UK and Italian textile and clothing industries. The initial findings of that will be made available in the new year. The principal focus of the research has been on wool and worsted fabrics and men's suits, which are important for the UK industry and with regard to which Italian manufacturers have been particularly successful. When it is completed, the study and its conclusions will be widely disseminated to the industry.

I was interested by the comments on public procurement. The Government cannot pursue a buy British policy. They must observe European Union rules and Treasury value-for-money guidelines. However, I emphasise that value for money is not the same as cheapest is best, and although we recognise that there is a legal framework and that there are inhibitions on a buy British policy, there is also scope to work within that framework—particularly on the basis of value-for-money criteria—to help the UK textile and clothing companies to compete better in tendering for public service contracts. Value for money must be the key criterion, but that does not necessarily mean that one looks for the lowest price all the time.

Technical textiles are one part of the industry that is booming. As my hon. Friend the Member for Amber Valley (Judy Mallaber) said, a significant factor in its growth is the increasing use of textiles in industrial applications that were originally the province of metals and plastics and of the automotive, aviation, construction, defence, health care, information technology and other industries. I will not list the various amounts of money that are going into this, but it adds up to a very significant contribution, and it is forging links with sectors such as higher education and research and training organisations. The Faraday partnerships are one of the routes through which that money can be channelled.

The hon. Member for Bosworth (Mr. Tredinnick) said that the Government were entirely responsible for the decline of this industry. That is one of the most absurd statements that we will hear this week—or any week. Classically, the textile industry has been subject to the forces of globalisation. The historical analysis of the hon. Member for Twickenham (Dr. Cable) was more accurate than the statement of the hon. Member for Bosworth: decline has being going on for a long while, and what is important is how one manages it and seizes opportunities.

In that case, will the Minister tell us why the industry is still declining despite the many years of his Government's stewardship?

The hon. Gentleman has made his point, and I will make mine: what is important is what one does to try to counter decline and seize opportunities.

That leads on to the point that was made by the hon. Member for Tweeddale, Ettrick and Lauderdale (Mr. Moore). He generously referred to my role with regard to the cashmere industry. I enjoyed that: I found it interesting, and it was ultimately rewarding because of the outcomes that were achieved. Anyone who was to look at what has happened in that industry as a micro-example of what can be done in the industry in general would learn many lessons.

The cashmere industry employs hundreds of people—maybe thousands. It is not a cottage industry; it is a very substantial economic contributor. It is also sexy, attractive and international, and it has all the status and economic benefits that flow from those attributes. If that can be done in the borders with cashmere, scores of other niches can be established throughout the United Kingdom. That will allow the industry to continue to be important and valuable. The industry will not, as it did before, succeed through the mass production of items that can clearly be produced more cheaply elsewhere, but that does not mean that there cannot be a healthy textile, clothing and footwear industry. I believe that the industry will be design and quality-led, rather than mass-production-led. There is much to be done, but with the industry and the Government working together, we will achieve it.

Mr. Deputy Chairman—

Order. I would be remiss in my duties if I did not remind the House for the second time this morning that, when the decision to establish a second Chamber was taken, it was determined that the four senior Chairmen of the Chairmen's Panel would be addressed as Deputy Speaker in Westminster Hall.

I apologise, Mr. Deputy Speaker. I came to the debate ready to address you as Mr. Chairman, and I checked with my neighbour, who said, "No, you should call him Mr. Deputy Speaker." I am afraid that somehow the words "Deputy Chairman" slipped out.

I shall start by making a couple of fairly uncontroversial statements. The first is that the Israeli-Palestinian dispute complicates a range of other issues. A great many ethnic and border conflicts are raging in the world, but none has external consequences on quite the same scale as those arising from the conflict between the Israelis and the Palestinians. The conflict complicates the war on terror enormously, because the terrorists and Islamic fundamentalists use it as an excuse—although I think that it is a pretty pathetic one—and keep pointing to what is happening on the west bank. The conflict also complicates American and British efforts to stabilise the Gulf and deal with Iraq and, more generally, complicates our dealings with the Arab and Islamic world. The consequences of the dispute are out of all proportion to the consequences on the ground for the parties to that dispute.

Secondly, Mr. Arafat and Mr. Sharon are unlikely ever to make a deal. Arafat was not prepared to accept what he was offered by Barak at Taba, and it is highly unlikely that Sharon will make that offer again. As he will make a lesser offer, it is unlikely that the Palestinians will accept it.

The resolution of the dispute is too important to the rest of the world to be left to the Israeli Government and the Palestinian Authority to resolve. The United States has realised that. President Bush came to power thinking that he would not have to bother too much about the middle east, but he has discovered pretty rudely that foreign policy has a way of insinuating itself into a political leader's life, no matter how much he might not want it to. I think that he was warned by President Clinton not to pay too much attention to the middle east because of what had happened at Camp David and at Taba. However, President Bush has found that the matter is top of his agenda as a result of the war on terror and his desire to do something about Iraq.

In January last year at Taba, the parties to the dispute very nearly resolved it. They spent a couple of days talking, having had extensive negotiations the previous September at Camp David. President Clinton had then put forward some new proposals, and those were discussed at length in Taba. I quote from the joint statement issued after those talks:

"The two sides have never been closer to reaching an agreement and it is thus our shared belief that the remaining gaps could be bridged".

Unfortunately, time ran out. Barak lost the election and Clinton left the White House. Arafat did not at the time seem prepared to make the deal, although my understanding from those who were there is that his negotiators would have had a positive—let us put it that way—attitude to the deal that was offered by the Israelis. We know quite a lot about what happened at that meeting, both from reports in the press and from Ambassador Moratinos and the European Union's report on what happened.

The Palestinians should have accepted what was on offer at Taba. I think that it was another Palestinian leader who said that the deal gave them 98 per cent. of what they wanted. If anyone gets 98 per cent. of what they want in negotiations, they are doing pretty well. I do not know which it is, but either Arafat could not or would not make that deal. He is not likely to be offered a better one.

Prime Minister Sharon looks set to win the Israeli elections, although in the Likud parliamentary list elections yesterday, the more extreme and right-wing candidates who back Netanyahu seemed to do rather better than Sharon's. It is unlikely that such an offer will be made to Arafat again. All of us who think about the issue, and who are not completely partisan, know that the Taba deal is the one that is going to be done. The Taba deal was very nearly done and it will, one day, be the one that resolves the dispute.

Let us go through the elements that have constantly been at the heart of the negotiations and what was on offer at Taba. The first issue is territory. At Taba, all of Gaza, 95 per cent. of the west bank and, as I understand it, a 3 to 5 per cent. land swap was offered. Whether the amount was 3 or 5 per cent. may become a big issue, but I cannot believe that a deal would stand or fall on that. Secondly, there is the solution of the refugee problem. The choices offered at Taba were that refugees could stay in the new Palestinian state, move to the area that would be given to the Palestinian state in the land swap, and some could return to Israel on a limited annual basis or go to a third country. Various countries had offered to take people and that seemed to be acceptable.

The third big issue was Jerusalem. At Taba, the offer was that Jerusalem should remain an open city that would be the capital of both the Israeli and Palestinian states. East Jerusalem would be the capital of the Palestinian state and the rest of Jerusalem would stay as the capital of Israel. Also on offer was a regime for the administration of religious sites. The Palestinian state would have jurisdiction over the top of Temple Mount, which is the location of the two mosques that are important to it, and the Israelis would have jurisdiction over the Wailing wall below. I am sure that some complicated legal fine print enabled that deal to be put to bed. Nevertheless, the principles, and more than just the principles, were put in place.

It was agreed that an international commission should handle the question of compensation. There are complications regarding that matter, but, once again, I cannot believe that, if a deal was on the table for everything except compensation, some way could not be found to resolve the matter. Of course, the compensation issue is not just a one-way street. The Israelis would say, "What about the Jews who were expelled from Arab states?" The fundamental issue is security, to which I shall return.

Most Palestinians want a deal; they want a state and they want to be able to get on with their lives. They feel frustrated that the Oslo process has not led them to that. My information is that the Palestinian negotiators at Taba were prepared to accept the deal. I hear from my Israeli friends, and from my friends in London who keep closely in touch with what is happening in Israel, that most Israelis would do anything for peace. Most Israelis would make almost any deal if the suicide bombings stopped and if they could get on with their lives and have some kind of normal relationship with their neighbours. Such people may vote for Sharon in the forthcoming elections, but really they support the Israeli Labour party's position on the negotiations. Barak had a lot going for him in the negotiations, but it was felt that he delivered nothing in the way of peace and security. People feel that Sharon has a better chance of delivering security.

We are in a cycle of violence. I will not take sides in the dispute, but shall propose a new way of approaching a solution. The cycle of violence is unlikely to be halted. In fact, it seems that the more that one side escalates the situation, the further the other side escalates it.

Two other pieces of the jigsaw fell into place at the beginning of the year. First, Crown Prince Abdullah of Saudi Arabia suggested to Thomas Friedman of the New York Times that, in return for peace, an Israeli withdrawal and the creation of a Palestinian state, the Arab world should recognise the state of Israel and normalise relations with it. The Arab League summit, held in March in Beirut, declared that in exchange for the refugees being dealt with and the withdrawal of Israeli armed forces from what would become the Palestinian state, Israel would get a peace agreement and normal relations with the Arab world. That is something worth going the extra mile for.

I return to the point that this dispute is too important to be left to the parties to resolve: the rest of us have too much of a stake to leave it to Mr. Sharon and Mr. Arafat, when no one believes that they are likely to reach a deal. The United Nations Security Council should pass a chapter VII mandatory resolution. Having determined a threat to peace in the region, which is undeniable, the Security Council can take decisions, which then effectively become international law. It should set out what was nearly agreed at Taba, plus or minus a few adjustments, in a resolution stating that that is the settlement. It would then be international law that the Palestinian state exists, that its capital is based in such a place, that Jerusalem is based on that regime, and that the choices available to refugees and the compensation arrangements are as defined.

All that would need widespread support, which might well be forthcoming. First, the permanent five members of the Security Council—certainly we, the French, the Americans and the Russians, comprising the Quartet group would support it; and although China has never shown a huge interest, it would be unlikely to frustrate it—would support the resolution.—In those circumstances, sufficient numbers of the other members of the Security Council could probably be carried. The two key non-Security Council members are Saudi Arabia and Egypt. Prince Abdullah declared his support and signed up to the Beirut declaration, as did Egypt, which has had diplomatic—or, at least, working—relationships with Israel. It would be good if we could bring the rest of the Arab and Islamic world on side, but irrespective of whether that proves possible, the resolution would create the Palestinian state. A buffer might be necessary in the form of a referendum in each territory—in Israel and in what would become the Palestinian state—to test the democratic legitimacy of the proposal. The resolution would set out the detailed terms of the creation of the Palestinian state.

I am fascinated by the hon. Gentleman's argument, particularly his reference to China's lack of interest in the region. Purely on a point of information, I heard recently from China's permanent representative in the United Nations that the country has sent to the region an envoy, who is now actively engaged in examining how China could support an eventual settlement. Perhaps China has a greater interest than the hon. Gentleman suspects.

That is an interesting point, which I did not know. Whatever China does, it would be unlikely to frustrate a settlement that everyone else was in favour of. Where its direct interests are not at stake, a country tends not to frustrate the actions of the Security Council. Framing the resolution and putting it in place will require considerable arm twisting. However, if the United States can twist the Israelis' arms and the Saudis and Egyptians can twist the Palestinians', we might well get a settlement.

That leaves the security issues, which are at the heart of the Israelis' concerns. Some of the discussions at Taba were about an international stabilisation force. Although it can patrol a border, such a force cannot stop suicide bombers. The Israelis need some assurance on suicide bombings, but it will be difficult to stop every extremist group that wants to frustrate the process. In these circumstances, the groups associated with Fatah might well stop; whether Hamas and Hezbollah would follow suit might depend on the attitude of their sponsors. The United Nations might need to invoke sanctions, which it can under chapter VII and articles 40 and 41, against states that continued to sponsor terrorism in Israel.

My suggested plan would not stop terrorism immediately, but it would put the settlement in place so that the details of negotiations—about the boundaries of the Palestinian state, the options available to refugees, the status of Jerusalem and so forth—would be settled and could no longer be used as alibis by the Israeli or Palestinian authorities to justify why they could not reach a settlement. The choice would simply be whether to implement or fight the settlement.

A UN Security Council resolution, supported by the permanent five members and the most influential people in the Arab world, and with all the diplomatic force that can be mustered from Britain, the US, Russia, Saudi Arabia and Egypt behind it, could offer a chance. I see no other route to a peaceful settlement in the middle east.

At the end of last week—before the debate—I informed the Foreign Secretary and the Minister of exactly what I intended to propose, in the hope that they would respond specifically to that, rather than dwelling on the multitude of aspects to the problem. I look forward to hearing a response from the Minister and from my own side.

rose—

Order. I remind hon. Members that it is customary in these 90-minute debates to commence the first of the three winding-up speeches 30 minutes before the conclusion. That leaves us only 45 minutes, and five hon. Members seek to catch my eye, so I exhort hon. Members to make their contributions concise and pertinent, and to resist interventions if possible.

When I arrived here this morning, I was not quite sure what we would discuss, and I am quite amazed at what I have heard. It is not often that I am amazed on this issue, but I am not sure where the hon. Member for Stratford-on-Avon (Mr. Maples) has been hiding his bushel. I listened to him when he was on the Opposition Front Bench in the main Chamber. I am also aware of what he has said in the Select Committee on Foreign Affairs, of which he is a member. This is one of those times when I wish that the Minister would speak next, so that we could hear what the Government think and then have a debate.

The idea that the Taba proposal should be the basis for a chapter VII UN Security Council resolution is imaginative, to say the least. However, there are major drawbacks with the proposal; it was not quite as simple as the hon. Member for Stratford-on-Avon suggested. He quoted from the final declaration, but I believe that the officials at Taba felt that a number of mistakes were made there by all concerned, not just by one side or the other. However, in the interests of not creating a division, I shall not attack what the hon. Gentleman said or disagree with it in any way, because I want to hear what my hon. Friend the Minister has to say about the proposal.

I think that most hon. Members arrived here this morning hoping to use these 90 minutes, with your permission, Mr. Deputy Speaker, to ask the Government questions that we will not be able to ask this afternoon, although there will be Foreign Affairs questions then and we have not really had a debate on the middle east for a long time. I accept that we are all concerned and determined to try to see peace between the Palestinians and the Israelis. We all know that the only way to achieve that is to get both parties round the table, and that the people who can achieve that are the Americans. Most of us have some idea of what the Americans should do.

We also need to send a simple message from this Chamber to the Israeli people: if they re-elect Prime Minister Sharon when the Israeli elections are held and on the platform on which he is likely to stand, most of us taking part in this debate will see no future in the short term for peace in the middle east. The real issue for someone like me, who has been involved with the issue for more than 30 years, is Sharon.

A recent series outlined the way in which the state of Israel came into being and showed the fight put up by various factions in the emerging state. Sharon comes through all the time as having a clear sense of what is required as far as Israel is concerned, but it is virtually a case of to hell with everyone else. It does not matter who he stands on or who he is prepared to push out of the road. To Sharon, the one important thing was Israel. It did not matter who he was pushing out or knocking out or whom he was prepared to move—Israel had to be established. One can well understand that, given the experiences in various parts of the world—including, it has to be said, the middle east—of those who came together to form Israel.

When it created the state of Israel, the General Assembly said that there should be two states, one mainly Jewish which became Israel, and another an Arab state. We can rake over the coals about whom is to blame following that General Assembly resolution, but the fact is that the Arab state has never been allowed to come into existence, mainly because of people like Sharon.

With great respect, the reason why the two states did not come into existence after the original UN resolution surely was that the Arab armies invaded that section that was allocated to Israel. Although one can accept the hon. Gentleman's strictures against Sharon as being clumsy and often brutal, is not it also a fact that the al-Aqsa martyrs' brigade, which is responsible for suicide bombings, is directly linked to Yasser Arafat's PLO? It is a little more two-sided than the hon. Gentleman suggests.

That is the problem. I am trying to stick to the way in which the hon. Member for Stratford-on-Avon started the debate. Already, the hon. Member for New Forest, East (Dr. Lewis) seeks to divide the Chamber and have us squabbling in the middle. I am trying not to do that. We will certainly squabble if the hon. Gentleman continues along those lines.

Sharon is a specific individual; when General Sharon was commander of the Israeli defence forces, the US Secretary of State, George Shultz, negotiated a peace agreement with Yasser Arafat, head of the Palestinians, who were then in the Lebanon. For six months not one Katushya rocket went across into the northern part of Israel, yet in June 1982 under General Sharon, the Israeli defence forces invaded Lebanon. That individual's history is of a man with a single vision; he has not shown, either as Prime Minister or as a general, that he has the facility to understand that if he is to live in peace in the area he has to live with a neighbour who, whether he likes it or not, is a Palestinian Arab. Therefore, rather than knock them about and defeat them on the battlefield, he needs to sit round a table, recognise them as an equal partner in negotiations and start negotiating. If he did so, there is the possibility that the Palestinians would respond.

I remind hon. Members of Sharon's history: when he was not Prime Minister but the leader of Likud, he walked on to Temple Mount, deliberately and provocatively, and brought into being a series of events that made it impossible for what was proposed at Taba to be agreed. From there, the situation has escalated into further violence. No one in the Chamber would go along with anyone losing their life; I am just as concerned about those people who are being killed now, whether it is a 95-year-old woman in a car or taxi waiting at a crossing point, or Iain Hook, who it now appears was deliberately targeted and killed by a member of the Israeli defence forces. I hope that when the Minister replies to the debate he will tell us how the investigation is going and what representations he has made.

One message that we need to send to the Israeli people is that Prime Minister Rabin gave his life; he understood that he had to sit with the Palestinians. He said that if the Israelis were to live in peace with their neighbours they needed to recognise that their neighbours needed space too. Prime Minister Rabin's land-for-peace proposals were the most imaginative of any Israeli leader for many years. I hope that in the forthcoming elections someone of similar stature will arise among the Israeli politicians to ensure that it is not simply a case of security, security, security. There will be no security if there is no peace. Peace can come about only when the Israelis and the Palestinians sit down together.

The hon. Gentleman has told us what the message would be to the Israelis. What would the message be to the Palestine Liberation Organisation?

The message would be exactly the same, although not to the PLO but to the Palestinians. The PLO is much bigger than those who assemble on the West Bank and Gaza at the moment. It includes all the refugees throughout the world. The Palestinians need to sit down with their Israeli brothers to negotiate peace. It needs to be based on land for peace. There needs to be a recognition of the two states, which has been the case for some time. It must be recognised that there is no military resolution to the conflict. The conflict must be resolved across the table between two parties and on the basis that both Israelis and Palestinians, including the Palestinian diaspora, have rights. If those rights are recognised and put on the table, there is a chance that peace will result. I am sorry that my speech has seemed rather rambling, but I am still trying to react to the proposal of the hon. Member for Stratford—on-Avon. I look forward to hearing what the Minister has to say.

I shall start by declaring an interest, as I am chairman of Labour Friends of Israel. I have just returned from Israel, and it was clear from that visit that both the Palestinians and the Israelis need peace. Palestinian income has dropped to less than $1,000 a year. Malnutrition is appearing. Palestinian civilians have been caught up in the crossfire of a dirty war. On the other side, 700 Israelis have been killed in less than two years. It is important to put that number into context. That is in a country of 6.5 million people. It is the equivalent of 7,000 people in this country being killed in acts of terrorism. How would we react to that death toll? What would be the pressures on the Government? The Israelis know perhaps more than any other nation what it is like to be on the front line of the war against terrorism; they know that there are no limits to the atrocities that the terrorists will commit to try to spread fear among the democratic people.

Many people feel uncomfortable with the reaction of the Israelis, particularly the Israel defence forces, to those terrorist attacks. I can understand why people feel that way, but we must recognise that Israel as a democratic nation has a right to defend itself. The only reality in today's politics in Israel is a contest over who can get the death toll down. Even getting the death toll down to 20 people per month from 60, as it was a few months ago, is seen as a victory. That dominates Israel's politics and it dominated my conversations with pretty much everyone I met, including Shimon Peres, Barak and people from Sharon's office and the military.

I am glad that both the hon. Member for Stratford-on-Avon (Mr. Maples) and my hon. Friend the Member for Dundee, West (Mr. Ross) phrased their remarks in the context of peace and what can bring us together. I agree with my hon. Friend that we should emphasise what unites the two sides in this conflict, rather than try to find ways to divide them. That is the key message that should go out from today's debate. These debates are scrutinised carefully outside the House: they are scrutinised as closely as any that we have. We need to put out the message that there is no monopoly on suffering in this fight. Both sides are suffering a terrible burden, and there can be no military solution to the conflict.

That is certainly what the members of the kibbutz that we visited believe. Kibbutz Metzer is very left wing, and when one sits in its canteen, one can see the minaret of the local Arab village, which is barely a few hundred yards away. The kibbutz has a shared kindergarten with its Arab neighbours, a shared football team and it shares its land and farming resources with the village. However, last month a young Arab terrorist, who was not from the village although he was fairly local, walked into the kibbutz and killed five people, including two children who were shot through the hack of their mother as she was trying to shield them. We asked our hosts about the reaction, and we were told that a meeting had been held and that nothing had changed in their heads. They still believed in giving up some of their precious land for peace and in sharing their resources with the local Arab village. Indeed, a flood of people came from the village to express their condolences. However, our hosts said that something in their hearts had cracked and that their faith in the peace process had been shaken.

That is true throughout Israel. People are very clear that there must be a change to what the Palestinians are doing—they must try to reduce terror. As the hon. Member for Stratford-on-Avon said, the condition is not that terrorism must cease, because that would provide the most extreme people in the conflict with a veto that would derail the peace process at any stage. However, there must be a belief that there is a genuine attempt by the Palestinian Authority to control and reduce terrorism. Until that happens, I do not believe that any progress will be made.

That was the very depressing conclusion that I took from my trip. The silver lining is that there is broad agreement on the outcome. If we can get people walking down the road that is set out in the "Roadmap", the destination is relatively clear, apart from 5 or 10 per cent. around the edges. The deal can be done, but it will be difficult with the current leadership. I cannot imagine a situation in which the Israelis will do a deal with Arafat, because they do not believe that he genuinely wants peace. We must face that difficult reality. Ehud Barak did as much as anyone to try to take on the legacy of Rabin and to come up with a proper peace deal. He was prepared to try hard to find a way to offer a deal on Jerusalem, settlements and refugees. As Bill Clinton said, he perhaps gave more than the Palestinians had expected. However, if one talks to Barak about Yasser Arafat, it becomes quite clear that if Barak would never do a deal with Arafat again, no one to the right of him in Israeli politics would. We must face that.

In that context, it is worth saying that there is hope. During the past few months, prominent Palestinians have publicly stated the futility of suicide bombings and have said that the armed struggle has reduced the amount of land under Palestinian control and has led to an appalling loss of lives on the Palestinian side as much as on the Israeli side.

We are all very interested in the hon. Gentleman's comments, but I wonder whether he could help us on one point—perhaps his memory is better than mine. I recall from the not-too-distant past that President Arafat agreed to a democratic process through which there would be elections, a recognised hierarchy and a democracy. Does the hon. Gentleman agree that that was the case and that it is the way that the Palestinians should go? That would give a broader base from which negotiations could continue.

I quite agree. Reform of the Palestinian Authority will be necessary in order to improve conditions for Palestinians on the ground and to give faith to others that it is worth genuinely engaging in the peace process.

The proposal made by the hon. Member for Stratford-on-Avon was very interesting. There will have to be a huge amount of international pressure if we are to get people walking down the road to peace. It may be that the hon. Gentleman's approach can get the parties out of their current logjam.

Two preconditions are necessary. First, there will have to be faith on the Israeli side that their security will be guaranteed. They will not agree to the Taba deal without a real belief that it will bring security. Without that security, the current terrorism could continue and the Israelis could be left with no cards to play to try to reduce it.

The second precondition would be recognition by the Arab states of the legitimacy of the state of Israel. The problem is not only Fatah; it is Hezbollah, Hamas and Islamic Jihad. In many ways, at the root of the campaigns of those organisations is not so much the Palestinian issue but the issue of the recognition of the state of Israel. That recognition is required from Iran and Syria in particular.

What more can we do? We in the west must keep pressure on the Israeli Government to go down the path of peace. We must continue to provide aid to the Palestinians to try to relieve the conditions on the ground. The Chief Rabbi has suggested that, in return, there should be conditions that require a much broader education for people in the Palestinian Authority, to ensure that hate is not spread through schools and that children grow up with a recognition of Israel and of their Jewish neighbours. We have to keep working with the Arab nations.

In that context, I want to make one quick final remark. I understand why we are engaging with Assad and why he is visiting. It is important that we bring Arab nations into the family of nations. In return, however, we have to make it clear that that cannot happen without a significant shift on the sponsoring of terrorism. The headquarters of all of the organisations that I mentioned are in Damascus. I am sure that the Prime Minister will raise such issues with Assad next week. Without an end to terror—terror from within not only the Palestinian Authority but the generality of Israel's neighbours—there can be no peace in that troubled area.

I, too, congratulate the hon. Member for Stratford-on-Avon (Mr. Maples) on securing this debate and on the way in which he has approached it. I also congratulate all speakers on the way in which they have spoken.

The hon. Member for Stratford-on-Avon made some interesting points. The story of what happened at Taba depends on whom one speaks to—a number of different accounts exist of what happened—but from the accounts that I have heard, I recognise some of what the hon. Gentleman said. I want to pick him up on one point—although I am sure that it was no more than a slip of the tongue. He wondered what might have influenced some of President Arafat's attitudes at that time. He said that he thought President Arafat might not have wanted to be the one who recognised Israel. However, President Arafat and the Palestinian Authority recognised Israel not only recently but several years ago. There is no doubt about the PA's recognition of Israel within the pre-1967 borders.

The Taba negotiations were clearly not completed. Neither side walked away from them; as the hon. Gentleman said, they simply ran out of time. We should acknowledge that. All too often in debates on what has happened during the peace process, Taba is almost jumped over. It is suggested that everything has flowed from the impression that a wonderful deal had been on offer at Camp David a few months previously, but the Palestinians had rejected it. I do not want to go into everything that happened at Camp David; suffice it to say that it was not as simple as has been suggested. The hon. Gentleman is absolutely right to highlight what happened at Taba.

I chair the Britain-Palestine all-party parliamentary group. On behalf of that group, I condemn violence against civilians from whichever side it comes—whether that be the case of the 70-year-old who died last week in Gaza when his house was demolished by soldiers when he was still inside it; or the appalling incident when children and their mother were gunned down in a kibbutz; or the suicide bomb in Jerusalem a few weeks ago that killed 11 and injured 40; or the 383 Palestinian children who have died since September 2000. My hon. Friend the Member for Stalybridge and Hyde (James Purnell) was right to say that 700 Israelis had died in the past two years and to ask how we would feel if the equivalent number of British people—about 7,000—had died since September 2000. It is important that we bear that in mind. In the same way, however, we should ask how we would feel if, like the Palestinians, the equivalent of more than 20,000 Britons had died in the same period.

It does not weaken in any way our condemnation or horror of the violence to recognise the need to move beyond it and look for its causes and solutions. We should remind ourselves that, although Israel has an absolute right to exist and to demand recognition without preconditions, Palestinian concerns are also important. We must avoid any suggestion that Israel has non-negotiable, absolute rights, whereas the Palestinians' rights are somehow discretionary. Uri Avnery, a well-known Israeli who has been active on the issue for many years and has a great deal of respect, put it well recently when he said:

"The first and worst violence is the occupation…Human rights are not a special favour granted to Palestinians if they behave like good children."

I am sure that Israelis, rightly, would not accept their rights being dependent on special behaviour, but that should apply equally to the Palestinians. We must recognise that when we see the reality of the occupation.

Hon. Members may have read the powerful article in The Observer last Sunday, which examined the situation in the Itamar settlement overlooking Nablus. Settlers there have been firing down on Palestinians whose only crime is to try to harvest the crop from the olive groves. I was chilled to read the words of an 85-year-old farmer quoted in the article, who said that the

"settlers approached me when I was ploughing my olive groves. They said, 'If we see you here again, we will shoot you."'

That was no idle threat: two people from that olive grove have died in recent weeks.

Such incidents are as morally unacceptable as suicide bombings. They are also illegal under the Fourth Geneva Convention, which relates to the treatment of civilians. The occupation and the settlements are illegal. When we look for ways in which the United Nations can adopt a more pro-active and assertive role, we must establish that international law is not negotiable or discretionary in the middle east. It is as sacrosanct there as anywhere else. I say that not only because it is right, but because we must try to understand the causes of the conflict and win the support and confidence of both sides.

My hon. Friend the Member for Stalybridge and Hyde is right to say that we need to understand the fear that grips so many Israelis. However, we must also understand the feeling of double standards that pervades in so many parts of the Arab world when we seem to treat their citizens' rights as different from the rights of Israelis.

Many hon. Members have questioned the way in which Sharon approaches issues, especially my hon. Friend the Member for Dundee, West (Mr. Ross). He is right to do that. It is sometimes projected that Israeli violence is a response to terrorism. If one examines the sequence of events, however, that is not borne out. In December last year, there was a Palestinian Authority ceasefire that lasted for 28 days. Not a single Israeli was killed during that time. All Palestinian factions agreed to it. However, during that time, Israel demolished the homes of 614 Palestinians in Rafah in Gaza, 19 Palestinian civilians were killed and Raed Al-Karmi, a Palestinian activist, was assassinated. I am not trying to suggest a tit-for-tat argument, but unless we understand the sequences, winning the confidence of the Palestinians will be much more difficult.

We need to ask what Sharon's agenda is, because his argument seems to involve a catch-22 situation. If, as a result of his constant military incursions, Palestinian violence stops, it is said that that shows that his policy works and why there must be an iron fist to put the people down. If Palestinian violence does not stop, the response comes, "Well, that shows why we've got to do these things." That is an absolute catch-22.

Last week, Sharon said:

"Israel can no longer be expected to make political concessions until there is proven calm and Palestinian governmental reforms".

My hon. Friend the Member for Stalybridge and Hyde said rightly that the first part of that gives the men of violence a veto on peace, so it makes no sense in that case. However, there is also a question of Palestinian political reform, which the hon. Member for Totnes (Mr. Steen) rightly mentioned. The Palestinians want elections. I visited the area in May and there was a constant demand for elections from members of the Palestinian Legislative Council, Palestinians in the street and the Palestinian Authority. Chairman Arafat wants elections. However, it is a bit difficult to organise and hold elections while closures stop people getting from one town to another and curfews stop people leaving their homes for most of the day. The international community could say that if there is a consensus that such elections should be held, not only Israel should have elections in the next couple of months because Palestinians should also have free and fair elections that are held in the presence of international observers. The weight of the occupation should be lifted to allow such elections to be held.

On present form, Sharon and the Sharon Government have not shown any interest in allowing such things to happen. Sharon said in a recent speech that a Palestinian state could perhaps make up about 40 per cent. of the west bank and Gaza. He said that the way to get from one Palestinian area to another could be by using bridges or tunnels. If we honestly expect to win the confidence of Palestinians, we must accept that they are people. They are not moles or rabbits. They cannot go from one place to another by using a series of tunnels. They must have a viable state.

There are alternatives. I am encouraged by the new leader of the Israeli Labour party and by what he has said. He seems seriously to want peace talks, which is great. He seems to recognise the Palestinians' right to choose their representatives. We should encourage that and encourage similar voices in Israel, just as we must encourage the voices of peace among the Palestinians.

We should also pay tribute to the small number of Israelis who, often in difficult circumstances, say that they are no longer prepared to go along with the occupation. A growing number of conscripts and reservists, who often have distinguished military records, are refusing to serve in the occupied territories. They are not pacifists, by and large. They say that they are prepared to serve in an Israeli defence force but they are not prepared to serve in an Israeli occupation force. That shows great bravery and courage and it focuses attention where it should be. Ending the occupation is not an add-on or luxury in addition to finding a settlement but it is absolutely central to that. We should pay tribute to the refuseniks and, as parliamentarians, encourage them as much as possible.

The conflict in the middle east has bedevilled not only that part of the world, but the whole world for so many years. It has already claimed the lives of far too many innocent people. It is right that all of us who participate in these debates condemn violence from whatever source it comes. If we are to move from condemnation to change, which is ultimately the important thing, the international community needs to be more assertive. I agree with the hon. Member for Stratford-on-Avon that that requires a new initiative from the United Nations and I welcome the fact that our Government are taking more of a leading role. If the initiatives are to work, they must be not only meant as even-handed, but seen as even-handed, which requires addressing the issue of double standards that is felt so keenly among Palestinians and throughout the Arab world as a whole.

I was very pleased that during our conference in September and October, my right hon. Friend the Prime Minister, in connection with his statements on Iraq, promised that the middle east peace process would move toward final status negotiations before the end of this year. More recently, on 25 November, my right hon. Friend the Foreign Secretary made some positive suggestions, which indicated that that would happen. I wish my hon. Friend the Minister to bring us up to date on that; this is an ideal opportunity for us to be told how far we have got in putting the middle east peace negotiations back on track.

I congratulate the hon. Member for Stratford-on-Avon (Mr. Maples) on securing the debate. It is timely, as the end of the year is approaching fast. I also welcome his suggestion. I have always been told that the Americans must help if we are to get peace in the middle east. There is some truth in that, but I have never believed that the Americans alone, with all their vested interests in that region, would proceed to final status negotiations.

The hon. Gentleman obviously believes that the key to unlocking this serious problem lies with the United Nations. I have always believed that; in the past, I have called for UN peacekeepers to try to keep the two sides in the middle east apart. Therefore, I strongly welcome the proposal, and I look forward to hearing my hon. Friend the Minister's response to it.

I am glad that the hon. Gentleman referred to the possible future role of UN peacekeepers. I was minded to inquire about that when my hon. Friend the Member for Stratford-on-Avon (Mr. Maples) made his opening remarks. We have been in that position before: permanent peacekeepers were in place in the run-up to the 1967 war. Does the hon. Gentleman agree that in any settlement imposed by the UN, those peacekeepers should be there permanently, and that they should be removable only by the UN, rather than at the behest of one or other side of the dispute, as has so disastrously happened in the past?

I would certainly welcome them being there, although I would hope that they would not have to stay there permanently. It is obvious that it will take several decades to achieve peace in the region; that will be a long-term process.

My constituency has a large Muslim population, and my Muslim constituents are pressing me on this issue more than on any other. I attend many meetings with them, and they keep asking me about the chances of success with peace negotiations in the region. Recently, I have had to tell them that I think that at present we are further away than ever before from achieving peace in the middle east; that is my opinion, but I hope that I am wrong.

Ariel Sharon does not appear to want to make peace in the region. An article in The Guardian a few days ago stated that Sharon has openly admitted that he does not want a two-state settlement. I am unsure whether there is any truth in that; perhaps my hon. Friend the Minister will tell us whether it is true. There cannot be peace in the region unless there is a two-state settlement. My hon. Friend the Member for Dundee, West (Mr. Ross) referred to Ariel Sharon's history. With Sharon in place, there can be no peace in the region. We will have to see what happens in future elections in Israel.

I am a scientist, so I examine the evidence. I have no axe to grind on either side of this argument. I used to be very supportive of the Israelis—I certainly was during the six-day war, when they were under attack from the Arabs. Now, my sympathies are the complete opposite: I strongly support the Palestinians because they are among the most oppressed people in the world.

As the hon. Member for Stratford-on-Avon said, the repercussions of the conflict in the middle east ripple out to wherever there are Muslim populations in the world. Matters such as the war on terrorism also go back to the central debate on the middle east.

When the Berlin wall was built, people throughout the world vigorously protested. I am old enough to remember it being built, and I remember the huge protests that came from almost every country. What amazes me is that a Berlin wall is being built from the north to the south of the region. Much of it has already been built, and I am told that it is higher than the Berlin wall, although I have not yet seen it. The wall is being built illegally 10 km beyond the green line, within Palestinian territory, and it is pinching 10 per cent. of that territory. It completely divides the west bank from the state of Israel. Have the Government made any protest about the building of that wall?

When I visit my constituency, it is apparent that hardly any of my constituents know anything about the building of the wall. It is one of the most devastating things that any country has ever done, but where are the protests? Where is the media coverage? I have not seen it. The wall has been mentioned in the quality press, but certainly not in the tabloids. Our country, and indeed every other country, should protest about the building of the wall by the Israelis just as much as they did when the Berlin wall was built.

I agree with my hon. Friend that it is tragic that the wall is being built. I saw it last week. I understand completely how the matter might seem from our perspective in Britain. However, does my hon. Friend understand that, from the perspective of the Israelis, the building of the wall is a dovish move, and one that recognises the two states? The building is being done to allow people to withdraw from the territories and to reduce what my hon. Friend would think of as the occupation. He may not like the details of the scheme—there are important arguments about its details—but does he understand that the matter is thought of very differently in Israel?

Of course I recognise that the matter is seen differently in Israel, but if the wall is being built in recognition of the two states, why is it being built 10 km—6 miles—beyond the green line? Why, at the very least, did the Israelis not build it on the green line?

I am a scientist, as I have said, and I consider the evidence. The evidence shows that the Israelis want totally to control the Palestinians. The Israelis have never had—and will never have, particularly not under leaders such as Ariel Sharon—a thought of a two-state settlement, except when great pressure is applied on them. One has only to consider the bypasses and how Israel has built settlements around Palestinian towns and villages. The wall is the most recent evidence of the intentions of the Israelis. Such behaviour has been going on under successive Governments, whether on the left or the right of the political spectrum in Israel.

The evidence shows that the Israelis have given no sign that they want a two-state settlement. They prevaricated throughout the peace negotiations. As I said, the Americans will not sort out the matter because they have too many vested interests. For that reason, I strongly welcome the proposal involving the United Nations; that is the only way out of the sticky mess that we are in. If we do not act on the proposal, thousands more people will die.

A few weeks ago, I received a booklet called "Who Will Save the Children?", which is produced by a variety of American organisations, and the information that it gives is horrific. It states:

"From September 29, 2000 through March 31, 2002, the violence in occupied Palestine and Israel claimed the lives of at least 232 Palestinian and 54 Israeli children under the age of 18."

Who will save the children? Perhaps the UN will; I hope so.

Palestinian towns and villages are rapidly becoming settlements within an expanded Israeli state. I hope that we can get the peace negotiations back on track, but we—not just America but the UN—will have to be strong on Israel. If we do not put pressure on Israel to come back to the table to talk seriously, the devastating ripple effect will continue for decades and affect the rest of us throughout the world.

First, I congratulate the hon. Member for Stratford-on-Avon (Mr. Maples) not only on initiating the debate, but on the quality of his extremely interesting contribution. I regret that my right hon. and learned Friend the Member for North-East Fife (Mr. Campbell) cannot be here today. He contributes regularly to such debates and has important points to make. I hope that he will be back in his place soon.

Fundamental truths are repeated constantly in such debates. They need repeating because they are correct. Israel is entitled to live in peace within secure borders and free from attack or threat. Palestinians are entitled to justice and to a viable homeland, both administratively and economically. We have set out such a position in UN resolutions that have survived the debates on the subject over many years. They are as true today as they have ever been. If that is the potential light at the end of the tunnel, I can only repeat what was said to me recently at the United Nations. An Israeli said, "We can see the light at the end of the tunnel, but we cannot see the tunnel." The fact that we seem so distant from achieving such clear objectives is depressing.

Let us be clear in this Chamber that terrorism and the loss of innocent life is something that we must deprecate. It is not justifiable. The hon. Member for Stalybridge and Hyde (James Purnell) was right to say that Israelis need to be confident that effective measures are in place actively to discourage those who would attack them from within Palestine. Let us understand that the reaction of those who undertake suicide bombings or the like is born of the desperation and the circumstances in which they find themselves, which is based on occupation, a regime of coercion and economic strangulation, and the illegal settlements to which reference has been made.

We must remember that the second intifada started with the determined trip of Sharon to Temple Mount. He knew what the consequences of that would be and he used it for political purposes. He adopted such a position, and I believe that he can end it, too. It is an historical perversity that right-wing leaders are often in a better position to achieve settlement than those who take a more centralist position because such people can take their population with them. Let us hope that Sharon takes that view.

The outside world is aware of the critical importance of the position in the middle east and, as has already been said, the ripple effect covers a much wider area. During my recent trip to the United Nations, it was interesting to talk to members of the Security Council, ambassadors and permanent representatives from wider circles. Other than those representing Arab states, they were not willing to countenance an express linkage between the arguments on Iraq and those on the middle east. Nevertheless, we all understood that that linkage was made on the streets throughout the Islamic world and that it was necessary to be seen not to have double standards.

There is an implicit requirement to meet the impatience of many who do not see the international community acting with the same resolution in the middle east that it is now willing to show in respect of Iraq. Some blame the way in which the Palestinians have played their hand in the United Nations. There is some substance to that belief; the way in which they have used international organisations has not been clever. However, we need to understand that the middle east colours the responses of those whose help we need in the war against terrorism and to ensure that appropriate pressure is applied to Iraq. We must also understand that any conflict in Iraq would have devastating consequences on the position in the middle east, and could take us to a point of no return.

Where does the international community stand in all this? I reject the view that we should not deal with President Arafat. He is the elected head of the Palestinians and must be party to whatever emerges. We should put pressure on the Palestinians to bring every pressure to bear in their communities to persuade the factions that want to pursue the conflict through terrorist action that there are better ways of doing so. I appreciate that that is difficult when there is a complete breakdown of civil or peacekeeping administration in areas under Palestinian Authority control. None the less, that pressure needs to be maintained.

Our principal course of action must be a renewed firmness in dealing with the Government of Israel. Several factors must be considered. The settlements are a running sore and are illegal, as is the continuing demolition of Palestinian homes. Even today, a court is examining the proposed further demolition of Palestinian homes in order to widen the road to an illegal Israeli settlement. The Israeli Government must understand that that is unacceptable. We must make it clear that aspects of the suppression in Palestine are incompatible with Israel's status as a democratic nation that subscribes to the same human rights to which we in the western world subscribe.

There is curfew, collective punishment and the reported refusal to allow Arafat into Bethlehem on the ground that he has damaged the position of the Christians in Palestine. I must say that he has not damaged their position nearly as much as the Israeli tanks have done. There is the shooting of innocent individuals, including members of the international community: I refer to the shooting of Iain Hook on 22 November. Only yesterday in Gaza, Israeli security forces attacked a bus belonging to the United Nations Works and Relief Agency. All these factors create the circumstances in which terrorism thrives. That must be brought home to the Israeli Government, as must the fact that the western world cannot launch a consequential attack on those whom the Israelis identify as their enemies. Mr. Sharon must be disabused of the notion of a crusade. There will be no such crusade against Iraq, Iran or whoever is next on the list.

We must take into account our economic and military links with the nations in the area and reconsider the matter. Israel and the European Union are prime trading partners, and we are still supplying arms, directly or indirectly, to the area. I understand that the Israeli elections are coming up, so these are difficult issues. I understand that the rightward drift poses a difficulty, even in the Likud party, despite the rejection of Netanyahu. The quartet—the United Nations, the European Union, the United States and Russia—must act effectively. We are told that they are doing so, and the Minister may tell us whether the Foreign Secretary was right when, on 25 November, he talked about positive developments and determined moves. However, the process must break cover so that the whole world can see that progress is being made.

I commend the suggestion made by the hon. Member for Stratford-on-Avon that the United Nations Security Council should take a lead. I am a great believer in the primacy of the Security Council and the crucial role that it has to play. I also believe that the United States must be on board for the Security Council to be effective. We also need to persuade the Syrians and the other Arab league nations of the good sense of what is proposed. I look forward the Minister's reply, but whatever happens needs demonstrably to happen now if the Arab world is to have any confidence that the international community is even handed.

This has been one of the most refreshing debates that I have attended on this topic. I commend my hon. Friend the Member for Stratford-on-Avon (Mr. Maples) for initiating the debate and for the enlightened way in which he launched it this morning. Any student who wants to learn about the subject should be sent a copy of my hon. Friend's speech, which contained a masterly synopsis of the facts. It is all there in a nutshell. At a time of stand-off in the region, his is a thoughtful, balanced and well-intentioned initiative that deserves to be taken seriously. We have had Camp David, Taba, Tenet, Mitchell, Crown Prince Abdullah and now Maples. What my hon. Friend proposes must be taken as a serious possible course of action. He said that most Israelis will vote for Sharon, but for one peace. The phrase that best describes that apparent contradiction is that they are short-term hawks but long-term doves. A lot of hope rests on a dissection of the psychology behind that opinion.

The security situation is deteriorating. It is something that we have all studied and I witnessed it for myself in May on the day that I walked through the rubble of Jenin. When I returned to Tel Aviv, I heard an explosion in a snooker hall just down the coast—the result of a suicide bomber. It is that juxtaposition of violence that bedevils the issue from day to day.

This is a crucial time because while the world community is looking at Iraq and our gaze is averted, things may go even more wrong. We do not want that to happen. What drives us all demented with exasperation is exactly as my hon. Friend explained: so many of the crucial ingredients for peace are largely in place; they are scattered like a jigsaw on a table, waiting to be put together.

I shall be brief, to allow the Minister to give what I know will be a considered response to my hon. Friend's speech. As he said, the ingredients are there: borders, the right of return, settlements and Jerusalem, the four main components of a potential peace. However, there are no willing interlocutors and therefore there seems to be no progress. As hon. Members have said this morning, there is no military solution.

A solution has been proposed by my hon. Friend. Central to his plan is the concept of imposition by the United Nations under chapter VII. It genuinely reflects our frustration that if only someone could bang heads together something could be done, because the ingredients are there. However, it throws up the issue of whether people can be led into an agreement willingly or whether they need to be pushed. That is at the heart of the concept behind my hon. Friend's proposal.

A parallel can perhaps be drawn with Northern Ireland, where there was similar, seemingly hopeless, sectarian violence. That is often mentioned by the shadow Foreign Secretary, my right hon. Friend the Member for Devizes (Mr. Ancram), who was a Minister with responsibility for security in Northern Ireland. He saw that the best step forward was to establish confidence-building measures, which were part of the Mitchell proposals, from a lower level, by grandmother's footsteps, to the point where the main participants in the political process could act on the foundation of mutual trust. The question mark over my hon. Friend's proposal is whether that ingredient can emerge from his process, whether his proposal can work without it and whether some kind of compulsion can lead to the solution that he proposes. But trust cannot be imposed; it has to emerge by degrees over time.

I could say so much but there is no point in rehearsing the attitudes that the two sides face. Suffice it to say that we on the Opposition Front Bench fervently defend Israel's right to exist, to be recognised by all and to live in complete security from terror and destabilising pressure. We also defend the Palestinian people's right to live in a climate of hope in a state of their own.

We must all put ourselves into the mind of each side in this continuing conflict. The Israelis feel insecure and vulnerable: suicide bombers afflict them every day, and they have neighbours who they think want to do away with them altogether. They feel that the Arabs want to push them westwards into the sea. Palestinians, however, feel humiliated, dispossessed, stateless and subjugated. They feel that the Israelis want to push them eastwards across the river into Jordan.

Anyone can take up the cudgels for one side against the other, but it is no good adopting a polarised stance. One does not have to be anti-Arab to be pro-Israeli, or anti-Israeli to be pro-Arab. Arab-hating attitudes are potentially as iniquitous as anti-Semitic ones. To be pro-peace, one must be pro-both sides. Any reasonable assessment of this complicated issue realises that there is cause and fault on both sides. We must totally condemn suicide bombings on any target against the Israelis. We must also condemn the building of illegal settlements by the Israelis on land that is outside the legitimate borders of their own country. Beyond that, however, playing the blame game does not get us very far. Any of us can construct a tit-for-tat catalogue of claims and counterclaims, and accusations and counter-accusations, but such an antiphony of name-calling gets us nowhere.

We need a de-escalation of violence and the gradual, steady growth of trust, perhaps starting, as I suggested, at the lower level and rising to the point at which two leaders with a genuine desire for peace can converse, negotiate and take their people willingly to a conclusive agreement.

I think that all hon. Members present agree that a two-state solution is the only answer for peace. However, the hon. Member for Bolton, South-East (Dr. Iddon) and others asked a question relating to the crucial role of the Americans. I think that both parties can walk the path to peace only if the Americans persistently and consistently take an interest in, and pay attention to, the middle east peace process. If they are in it for a few months and out for a few months, the whole process will falter, as we have seen.

Whatever the merits of the President's speech in June, things have stagnated ever since—the process has gone quiet. However much one might wish the United Nations to get involved, as my hon. Friend the Member for Stratford-on-Avon suggests, without consistent attention from the Americans, that will not happen, if only because they will not necessarily do what is needed in the UN for the UN to do what it needs to do. Essentially, this is the dilemma that my hon. Friend puts so well: to tread the path to peace, should it be the UN, the US, or both? I harbour some doubts about imposition by the UN. I do not think that that would work without the United States, but it is a serious proposal that needs to be seriously entertained.

For any settlement to last, there will be no substitute for genuine confidence-building measures and the building of trust. If the participants feel that they have been forced and they are not, within themselves and their people, willing in the agreement that they are asked to meet, it is unlikely to last. In the absence of US attention, and willingness within the two parties that have to sign up to peace, the UN solution will get us only so far. That said, at last and at least there is an initiative in the climate of misery that we otherwise face. I congratulate my hon. Friend on his thoughtful and reasonable contribution.

I congratulate my colleague from Warwickshire, the hon. Member for Stratford-on-Avon (Mr. Maples), on initiating the debate. It is on an important issue, about which many hon. Members feel very strongly. They are deeply concerned about the death and destruction that has occurred among the Israelis, Palestinians and others as a result of the conflict in the middle east. Let me take this opportunity to agree with the hon. Member for Somerton and Frome (Mr. Heath), who mentioned the right hon. and learned Member for North-East Fife (Mr. Campbell). The right hon. and learned Gentleman has made a valuable contribution to these debates in the past. We hope to see him here again soon. Indeed, I saw him the other day on television looking robust. I know that he is still active and we wish him well in his struggle to regain his health.

The debate has been serious, and a number of important points have been raised. Before I deal with the proposal made by the hon. Member for Stratford-on-Avon, I should like to say something about the cycle of violence that has been faced by the Israelis and the Palestinians. The consequences have been tragic. Since the intifada started just two years ago, more than 2,000 Palestinians and nearly 700 Israelis have lost their lives. Everyone in the region suffers from the continuing violence and the absence of a final settlement. UK nationals have suffered too. Most recently, Iain Hook, the UN Relief and Works Agency employee, was killed during an Israeli incursion into Jenin on 22 November. I offer my deepest condolences to lain Hook's family at this difficult time. We will hold the Israelis to their commitment to carry out a full investigation into what happened.

My hon. Friend the Member for Dundee, West (Mr. Ross) asked whether we had raised our concerns. We have done so at the highest level. I spoke to the Israeli ambassador last week, and I am going to meet him again this afternoon to talk about this and other matters. My right hon. Friend the Foreign Secretary has spoken to the Israeli Foreign Secretary and we are awaiting a written report of the Israel Defence Forces inquiry, which we will study in due course.

A negotiated settlement of the dispute between Israel and the Palestinians is long overdue. The same goes for Israel and her other neighbours. We have consistently sought to reach a just settlement based on UN Security Council resolutions 242, 338, 1397 and now 1435. As the hon. Member for Stratford-on-Avon said, the outlines of such a settlement are clear: a viable state for the Palestinians and security for Israel within recognised borders. Israelis and Palestinians alike deserve to enjoy security from attack and the freedom to run their own lives.

The hon. Member for Stratford-on-Avon proposes that the UN Security Council pass a resolution under chapter VII imposing a solution along the lines discussed by the Israelis and Palestinians at Taba in January 2001. There has been much speculation about the detail of those negotiations and about earlier talks at Camp David. The negotiators themselves said that they got closer to a settlement at Taba than ever before. Unfortunately, their efforts fell short of a permanent status settlement, which all the parties said they sought. The hon. Gentleman's proposal is very interesting. It deserves to be taken seriously. My view is that it is not a flier now. In the longer term, it is possibly a serious issue that we will have to consider in a wider context. It is not something that we can go forward with at this time. There are a number of reasons for that.

Although it is possible for all of us to sketch the outlines of a settlement in the middle east, it is in the detail of a settlement that the difficulties arise. I agree with the hon. Member for Rutland and Melton (Mr. Duncan), who was cautious about top-down solutions. He referred to the need for confidence-building measures between the parties. He also said that the impetus for agreement had to come from within the parties involved in the dispute. All that is true. I am also a little bit wary given the history of chapter VII, which we are currently dealing with in relation to Iraq, Liberia and Libya. Should we place Israel in the same category? If my memory serves me correctly, it would be the first democracy to have a chapter VII resolution imposed on it. Such a resolution is enforceable by sanctions or military action, so we should be cautious before we take resolutions down that route. Chapter VI resolutions have been the chosen vehicles for the UN's resolutions on the middle east, and I believe that that remains the right approach at present. It remains to be seen whether chapter VII resolutions will be appropriate in future.

The problem with chapter VI is that, if we want to impose a solution, we must have chapter VII. If the international community decided to go down my chosen route, it would have to invoke chapter VII.

I take the hon. Gentleman's point, but thus far we have seen no clear agreement on crucial points at Taba, and we cannot impose a settlement on which the parties are not agreed. Extrapolating something from Taba that really is not there would be counter-productive. For a start, the Israelis and Palestinians are not even agreed on what was discussed at Taba, let alone what was finally agreed. Similarly, disagreement remains between the parties about Mr. Moratinos's role in the process. Taba saw no agreement on land with no map defining the boundaries, no agreement on the Temple Mount or Haram al-Sharif, and no resolution on the right of return—a red line for both Israelis and Palestinians. At this point, no easy way of finding a resolution to the red line issues underlined by both sides is apparent. Israel wanted a demilitarised Palestinian state, but the Palestinians were unprepared to accept it. A series of difficult issues were not resolved at Taba, so using Taba as a template for the UN to impose a solution would not be the best way of making progress.

It remains right to view Taba and Camp David as starting points on which further negotiations can be built. As the Foreign Secretary said, they provide a broad framework for handling some of the issues that still divide the parties—settlements in Jerusalem, for example, must figure in final status negotiations. A solution cannot be imposed on the parties through a UN resolution under chapter VII and the parties themselves cannot reach a settlement: it requires vigorous intervention by neighbours and the wider international community, including the UN.

The goal of our current efforts is the urgent resumption of negotiations and the Quartet, the EU, the UN and Russia will play the key roles in achieving it. We shall support them whenever we can. The Quartet is currently drawing up a road map aimed at achieving a final settlement within three years. It will be comprehensive and will include the Syrian and Lebanese tracks. It will address the political, economic, humanitarian, institutional and security dimensions, while spelling out reciprocal steps by the parties in each phase.

Progress will be based on the parties' performance in key areas, including Palestinian security reform and Israeli withdrawal to pre-intifada positions by mid-2003 as the security position improves. Performance will be monitored and assessed by the Quartet. The parties must do everything in their power to reduce violence, build confidence and resume negotiations. They must implement the steps set out in the road map. That is the basis on which we hope to take these issues to a conclusion. We must ensure an end to the suicide bombing, which is stopping the achievement of a Palestinian state, and the Israelis must withdraw from Palestinian land as part of an overall peace settlement. The objective is to move negotiations forward and to ensure that we achieve peace and a final resolution of these disputes. The Palestinian people and the Israeli people deserve peace and the international community should work with them to achieve that.

It is a privilege to begin this brief debate on council housing. Labour councils all over the country have been proud of their contribution to building council houses and maintaining council house stock. We should be proud of the social housing sector because it belongs to the people and is administered by their elected representatives.

Council housing is now more necessary than ever. Prices in the private sector are rocketing, especially in the south-east, because the laws of supply and demand have gone mad. Although demand for housing has increased, we are building fewer houses than at any time since the great depression of the 1920s and 1930s. People are being priced out of the private housing market; they cannot afford it. We now have a lot of subdivision of families. Single parents, in particular, cannot afford to buy, so they need social housing.

The amount of social housing is shrinking. Housing associations have more money, but they are building fewer houses because costs are rising. A Labour Government—I will repeat that phrase with emphasis in the way that Neil Kinnock would have done at a Labour party conference—a Labour Government are selling council housing at a faster rate than the Tories ever did. The target is the transfer of 200,000 council houses in large-scale voluntary transfers each year.

To pressure councils into selling, the Government have deliberately underfunded council housing. Councils cannot keep up with the volume of repairs. The backlog is huge. In 2000, the Government estimated that the repairs backlog amounted to £10 billion, and the improvements backlog was estimated at £9 billion. In other words, a total of £19 billion is needed for repairs and improvements.

In tackling the problems of social housing, housing associations have many advantages that councils do not have. Housing associations can borrow on the stock market, which gives them a lot of power to build houses and carry out repairs. Their tenants do not have to pay the daylight robbery system—a system whereby the housing benefit of council tenants is paid by other council tenants out of the housing account, which is money provided for housing. Thus the poor are being asked to subsidise the housing benefit of the poorest, instead of that money being paid from the social security system. Tenants of housing associations do not have to pay that. The result is that councils, which are underfunded, have real problems in keeping up with repairs.

My council—North East Lincolnshire council—can do only the most urgent repairs because it does not have the money to tackle other repair problems. We did some calculations for a presentation for the National Audit Office's review of large-scale voluntary transfers. There are about 2.8 million council houses and we calculated that the average rent is some £2,500 a year. Of that, £1,500 goes on management, maintenance and major repairs, leaving £1,000 that is, in effect, siphoned off by Government. Most of the money goes to pay for the daylight robbery system in which housing benefit is paid by councils rather than by the social security system. When it comes to a large-scale voluntary transfer, that £1,000 is available to the housing associations to play with, but not to the councils. It gives the housing associations an advantage. They can do repairs, provide better services to tenants, and build new houses.

Last month, I attended a housing conference with the north-east branch of the Chartered Institute of Housing. I heard an exciting presentation by Tom Mannion, the chief executive of the Irwell Valley housing association in Manchester. His association has few problems with arrears, which can usually be quite a problem for councils. It has few problems involving crime, drug-addiction and expulsions, and is able to provide a more effective service, good behaviour contracts with tenants and gold service guarantees so that, when repairs become necessary, tenants can choose which repairs are to be done and the bill is not paid until they are satisfied with the work. Repairs are to be done as soon as a tenant with a gold service contract requests them.

I asked at the conference why councils did not offer the service as a means of improving their housing. My suggestion was received with a laugh of pity. Housing managers gently explained to me that councils do not have the same numbers of staff to go out and cosset and counsel the tenants as housing associations. Nor do the councils have the money or the flexibility to provide such a service. That is why councils face a repair backlog and the problems of sink estates where nobody wants to go. The housing there is going steadily downhill and the council can do nothing about it because it does not have enough money for repairs and renovations to make the estate attractive.

Then, along comes the Audit Commission and kicks councils when they are down. We have just had an Audit Commission report on North East Lincolnshire council that comments on the low morale of staff in the housing department. It says that repairs are done more on a fire brigade basis than planned, and that it would like that to be the other way round. It comments on the number of voids. All those problems are the direct consequence of the council having no money. The lack of money for repairs for the deteriorating estates means that repairs have to be done on a fire brigade basis rather than being planned and orderly.

We should all ask a basic question of the office of my right hon. Friend the Deputy Prime Minister: why are such things being done to social housing when this country needs more social housing and more council housing, as a major contributor on the social housing scene? I hope that the Minister will enlighten us today, but I believe that such things are being done deliberately to make the life and the lot of council tenants so miserable that they vote for large-scale voluntary transfers. Such things are done to force transfers on councils and ensure that tenants vote for them.

Large-scale voluntary transfers are expensive. We are giving away a massive public asset. We are paying the cost of the councils' campaigning, to bamboozle the tenants into giving the asset away. We are giving away the housing benefit of those tenants who transfer, because the benefit comes from the social security budget, not from the other tenants. We are writing off debt to persuade councils to agree to large-scale voluntary transfers. In estimates for 2003–04, £800 million will be allocated for the purpose, which is nearly as much as the £843 million allocated in the same period for the total budget for council housing credits to fund all council housing. We are giving away that much to encourage large-scale voluntary transfers.

Birmingham City council was offered £650 million in written-off debts if it transferred its council housing. It was taken back when the tenants voted no to a transfer. Ministers should be thoroughly ashamed of supporting, countenancing and continuing such a policy.

Despite all the bribery and bullying, the 200,000 homes target for transfers is not being met, even though everything is predicated on it. The decent homes target is predicated on a transfer of 200,000 homes a year. That target will not be met, and is being quietly dropped. Despite the pressures, tenants are voting no. There have been no votes in Dudley, Birmingham, Southwark, Merton and Ealing, and councils in Nottingham and Sheffield have decided not to go ahead with the transfers. Although everything is predicated on it, it ain't working. That must produce a new decision and a policy change, because policy is running into the buffers in this area. Tenants want to stay with the council. No wonder the Government are beginning, slowly—far too slowly—and painfully to pull back from the implications of their policy. The Local Government Bill, which was announced in the Queen's Speech, contains a provision for councils to be able to borrow. I do not know whether borrowing would be on rents, stock, or service charges, but that is an advance, provided that it is prudential. Of course, everything the Government do is prudent anyway, so I am not worried about that.

The Government are allocating more money slowly and grudgingly, and they are making it somewhat easier for many arm's length management organisations. However, if we are to have an arm's length management run by councils, I do not see why housing cannot stay in a council's possession, with the same advantages given to the council as are given to arm's length management organisations, in which there is potential for corruption. Policy is being modified and it should be modified, because it is stalling and running into the buffers.

I hope that the blue skies review, which my right hon. Friend the Deputy Prime Minister will announce in January, will continue the process of change. I have great confidence in, and enthusiasm for, the Deputy Prime Minister, who could be a driving force behind the big social housing programme that this country needs. That programme has, however, been held in check because my right hon. Friend's Department has not had enough money. With the money and the flexibility that allows councils to borrow, he could initiate the drive that we need. So much else depends on decent housing, particularly social housing, for those people in our society who are less well off. How can people benefit from the provisions for education that we are making unless they have good housing? How can people benefit from the improvements in health that we are making unless the causes of bad health in housing are removed? How can we have a settled society with lower crime rates and less drug addiction unless people have good, affordable social housing? How can we reassert neighbourhood ties unless neighbourhoods are well housed in social housing? None of those things can be done without good housing.

I simply ask for a level playing field between councils and housing associations. We are proud of councils, which are still mainly Labour and which built the housing stock and created the housing associations. Let us end the daylight robbery whereby housing benefit for council tenants is paid out of housing funds. We must allow councils to borrow, so that they can build, renovate, repair, use the leverage of credit to increase the power of tenants and begin a programme of building. If housing associations and councils are on a level playing field, so that there are not the bribes and benefits to vote for large-scale voluntary transfers, they will be able to compete or co-operate.

What is wrong with competition in social housing? It will serve the consumers' needs. What is wrong with competition to serve particular areas' needs? In some parts of the country, there are too many council houses and numbers need to be reduced. Let us allow councils and housing associations to co-operate so that those can be pulled down and so that they may replenish and review where necessary. Let us allow them to co-operate to build anew where it is needed. With a level playing field we can do that. I ask for a new deal for council housing, so that we can build, improve, repair, renovate and pull down as necessary.

It is almost indecent that Ministers and hon. Members, including myself, are sitting here in London benefiting from the giddy escalation in the price of houses that they own, which are financed out of a parliamentary grant, and, at the same time, are treating indecently those who cannot afford to buy houses and who live in social housing. Although such people might like living in social housing—it should be provided for them—we should not treat people who do not have the money to put down on a house and benefit from the appreciation in value as badly as they are being treated.

Why are we persecuting council tenants? Why are we making life so difficult for Labour councils, which are the front line of the Labour party and which need support, help and encouragement to fulfil their aspirations for their people? Why are we devoting so much time and effort to shuffling round the ownership of social housing when we should be making a massive effort to build, repair, renovate and improve? Why are we throwing away public money on large-scale voluntary transfers when the need is for a massive programme of new building not only to regenerate the economy and provide jobs, but to regenerate the local scene and local society and to improve the lives of the people whom we represent?

I welcome the opportunity to join my hon. Friend the Member for Great Grimsby (Mr. Mitchell) in reflecting on the importance of high-quality social housing and effective housing management services. I am afraid that he will have to wait for at least a couple of weeks for the answer to several of his questions until my right hon. Friend the Deputy Prime Minister's statement in early January on blue skies—not least—and other things.

I shall set out why the Government believe that retaining housing stock in local authority ownership is only one option for delivering our objectives. It is an option. Despite the doom and gloom that has been painted, there is significant investment in our council housing stock and the option remains for all local authorities.

The delivery of thriving, inclusive and sustainable communities in all regions is at the heart of the Government's agenda. As my hon. Friend said, the issue is all about communities, and we must help people who live in some of our most deprived areas to live successfully, to fulfil productive lives and to realise their potential. That was reflected by what my right hon. Friend the Deputy Prime Minister said on 18 July when he announced his decision to examine whether his Department's programmes and policies were delivered in the best way in which to achieve those ends and to secure value for money while achieving the collective aim of the decent home.

I tell my hon. Friend that the decent homes standard has not been dropped in any way, shape or form. We are bang on target to achieve our interim target for 2005. As the Minister for Housing and Planning, Lord Rooker, said recently, we are about 10 per cent. shy of the target for 2010. However, there is not the doom and gloom that my hon. Friend suggested. The fact that we are 10 per cent. off a target that is not due to be met for eight or nine years does not mean that we should tear everything up and start again. I repeat that the decent homes target remains and we shall not be changed from that. The root of everything that we are talking about is the decent standards target and, as my hon. Friend said, the right of everyone to live in a decent home.

The 2002 spending review settlement also provided significant additional resources for housing. By 2005–06, we will be spending almost £6 billion annually on housing compared with the planned spend of £1.5 billion in 1997–98. Alongside that massive increase in resources, the capital receipts initiative that we brought forward in 1997 freed up about £12 billion of receipts up to 1999–2000. That demonstrates our commitment to a step change in delivering our objective of giving everyone the opportunity of a decent home.

When considering how the delivery of decent social housing contributes to the sustainable communities agenda, we are clear that several routes are available to tenants and their landlords. The housing policy statement that was published in December 2002 by the Department of the Environment, Transport and the Regions—a previous incarnation of the Office of the Deputy Prime Minister—set out four housing management investment options for local authorities, and my hon. Friend alluded to them. One such option is the use of arm's length management organisations. It does my hon. Friend no credit to suggest that there is potential for corruption in ALMOs, and he cannot make such a simplistic statement without a degree of justification.

Other options are the private finance initiative, housing transfers and stock retention within existing resources. Three of the four options mean that the housing remains in local authority ownership, and only housing transfers cause the ownership to move outside the local authority. We believe that it is wrong to see that change of ownership as an obstacle while our goal is decent social homes and decent social housing.

Many authorities and their stakeholders have already determined the option that will best suit them, but almost 100 authorities have yet to decide how they will deliver the decent social housing objective. Time is running out for those authorities and it is wrong that tenants might suffer as a result of inaction by their landlords. Therefore, we recognise that without action by all local authorities, we will not deliver our target by the agreed 2010 deadline. All social housing providers must up their game. We intend that the Government's current review of decent home delivery vehicles will help to ensure that there are no obstacles to local authorities delivering as both providers and enablers and, therefore, no excuses for not doing that. As I have told my hon. Friend, that will be duly reported by my right hon. Friend the Deputy Prime Minister in January.

I recognise that my hon. Friend believes that local authority retention of social housing should be a guiding principle, and that he campaigns for that. However, I believe that our focus has to be on the interests of the tenants—on the conditions of their homes and the services provided to them—rather than simply on who owns the housing. Several of the actions that the Government have already taken demonstrate that: the moves to a consistent rent-setting formula for local authorities and registered social landlords that ensure that rents for similar properties in the same location in different sectors will be similar; the introduction of a single housing inspectorate service to ensure consistent and high standards of provision; and the steps that are being taken to achieve a single social tenure.

There is also an increasing focus on the separation of the landlord function and fulfilment of the role as a strategic housing authority, regardless of whether the local authority retains ownership of the housing. That allows the landlord to focus on improvements in the physical condition of the stock, management arrangements and tenant involvement, and it frees the local authority to ensure that its statutory housing duties are carried out and that housing policy decisions contribute to securing wider community regeneration, as my hon. Friend said. That is possible in private finance initiatives, arm's length management organisations and housing transfers. However, in addressing my hon. Friend's concerns, I will focus on housing transfer.

We know that where tenants play an integral part in choosing the housing transfer option and developing the proposal, they also support it at the ballot. That has not changed recently, despite the cases that my hon. Friend mentioned. During the life of the recent round of housing transfers, when all the votes for and against stock transfer are added up, there are currently four votes in favour to every one against.

There have been notable exceptions to that, such as in Birmingham. That is why tenants are consulted. However, it is wrong to suggest that there has been a sudden and massive sea change, and that over the past year or so every ballot has gone the no way rather than the yes way. The votes are still overwhelmingly in favour of transfer, and I do not accept there is a deliberate conspiracy to make council tenants' lives so miserable that they will do everything but vote against transfer.

Where surveys are conducted in isolation from the campaign for or against large-scale voluntary transfers, council tenants state that their preference is to stay with the council because they can influence it democratically and it is a known and understood system that they quite like. It is true that where there is a campaign where all sorts of glittering blandishments are held out to them of repayments and renovations and a new happy future they might feel the other way, but in the abstract—

Order.

My hon. Friend should not belittle the intelligence or sophistication of council house tenants. He has claimed that they are bamboozled now that there are glittering prizes. They make clear decisions on their futures and those of their homes on the back of the information that both sides put in front of them. To talk about them being bamboozled, as though they do not fully understand the process or are easily led, undermines the integrity of my hon. Friend's case and does not say much for his impression of what council tenants are like.

The transfer of housing to a registered social landlord provides an important one-off chance for local authorities, residents and other stakeholders to improve community well-being. It is a vehicle to deliver the decent homes standard and major repairs and improvements to the housing and physical environment, but it can also deliver a range of other things: better housing management services that are strongly linked to a broader neighbourhood management approach; greater tenant participation in the decision relating to their homes and estates, far more often than is the case under the council; accountable and transparent governance arrangements; and partnerships with other service providers and stakeholders to deliver joined-up regeneration and new facilities in the housing transfer area that draw on external funding streams. As my hon. Friend suggested, stock transfer works best in the context of the regeneration of the entire community, rather than when it is simply a function of transfer or management. Together, these things add up to a way to secure a sustainable future for the community.

Confident, empowered tenants create stronger, safer communities. The best way to ensure that people get the best housing possible is to talk to them—to give them accurate and honest information, to ask them what they need, and to give them a chance to influence what happens to their homes and neighbourhoods. For their parts, landlords should not be afraid to get tenants heavily involved in considering how to deliver a sustainable housing service. That would help to challenge rumour and misinformation, and would allow reality to see the light of day.

The involvement of tenants secures their role in a shared vision for the future and therefore helps to create stronger, safer and better-run communities. When we put tenants first, they become active consumers, pushing for better standards and keeping landlords on their toes. They play a part in how increased investment can revive and renew our communities. From councils to the private finance initiative or arm's length management organisations, agencies are increasingly understanding that housing is not just about bricks and mortar, or the decent homes standard; it is about revitalising and regenerating our communities. My hon. Friend the Member for Great Grimsby tells a tale of woe but, under the housing transfer, more than 700,000 council dwellings have moved to the housing association sector. More than £11 billion of private finance has been secured for investment in the repair and improvement of the transferred stock and, through the receipt paid to the local authority, for funding much-needed new homes.

As I have made clear, we are looking not only for better homes but for better communities. I am therefore saddened when debates on improving housing conditions and services focus on ownership, and when discussions on housing transfer are hijacked and made into a wider debate, often centred on political allegiances. That is not fair to tenants and it destroys the opportunity to make a real difference.

Our policy of providing additional resources to councils that set up high-performing ALMOs to manage and improve their housing stock is also starting to deliver results. So far, we have accepted 21 councils on to the programme and have made conditional allocations of more than £660 million for the three years to 2004–05. To qualify for that funding, arm's length companies must achieve at least a two-star rating from the housing inspectorate. The first results are encouraging; we heard only yesterday that all eight ALMOs in the first tranche have qualified.

I make no apologies for the National Audit Commission inspecting housing departments. I do not accept what my hon. Friend says about inspection being a bogey word for adding to the sad lot of housing departments. There are flourishing housing departments throughout the country that are run by councils, that do a good, professional and committed job for their tenants. There are others that do not, and if the commission finds them out and sets up a rescue package, and that package is ignored, we are responsible to local tenants to ensure that they get the housing service that they deserve. I was a councilor for 11 years, and can say that there is no magic wand. Housing departments are not all good, and registered social landlords or private providers are not all bad. It is incumbent on us to use the inspection process to ensure that council housing departments do what they can to improve the condition of stock and the lot of the tenants.

I congratulate those councils with ALMO status on achieving high standards. Tenants can expect investment to bring nearly 80,000 council homes up to the decent homes standard. Inspection results from the second tranche will come through next year. The private finance initiative is also progressing. In 1999, eight local authorities were chosen to pioneer the housing revenue account PFI scheme as pathfinders. There are now 18 HRA PFI schemes and five non-HR A PFI schemes in procurement.

HRA pathfinders and round 2 schemes were allocated £760 million in PFI credits, and are expected to refurbish about 30,000 homes. Some of the schemes are expected to sign contracts early in 2003. Two non-HRA schemes have signed contracts, and a further four are at different stages of the process.

To conclude, I urge my hon. Friend to focus not on the ownership of social housing, but on helping to ensure that there is minimum delay in giving all tenants the opportunity of a decent home. That is best achieved through securing maximum resources for investment in our social housing in the near future. As part of the blue skies thinking and the public service agreement plus review of the assorted methods of achieving decent homes, there is a lot of thinking going on. We will not move from our key target of decent homes throughout the social housing sector by 2010, although it is quite right that we should reflect on the vehicles that we utilise to reach it.

The Government are doing their part in providing resources that are tied to performance improvements. We make no apologies for that. However, if we preclude housing transfer, and therefore access to private finance, tenants will be in poorer condition housing longer than is necessary. That cannot be right. To those who defend everything but are ultimately defending only the status quo, and have no answers for tenants on a range of council estates, I say: take part in the full debate that will unfold from mid-January, and do not become lost in the notion of ownership. How our people live and how they achieve decent homes is what matters, not who owns the freehold.

After 18 months of trying, this is the first time that I have been fortunate enough to secure a debate in Westminster Hall, and I am delighted to introduce it. I hope that today marks a change in my luck. I am also delighted that the Secretary of State for Scotland is to reply to the debate. As she will know, manufacturing is important throughout Scotland. When I discovered that she would be responding, I thought that I would find out the latest information from the web, and was pleasantly surprised to discover an unofficial Secretary of State fan club that describes her as

"by far the most glamorous doll in British Politics since Baroness Thatcher was put out to pasture".

Today's debate has been made all the more timely following the announcement last Friday from the Office for National Statistics of yet another fall in manufacturing output throughout the United Kingdom as a whole—down about 0.7 per cent compared with the previous month and 2.4 per cent. compared with the same time last year. Geoffrey Dicks of the Royal Bank of Scotland, financial markets described those figures as

"awful and the fourth successive monthly decline".

I requested today's debate not because manufacturing is a major source of employment in my constituency, but because of its importance throughout Scotland. I shall be paying tribute to some of the positive aspects of the Government's work, but it is my duty to point out some general concerns. I will not be talking down Scotland. It is sometimes said that people do that when referring to bad news. Today provides me with an opportunity to make a positive contribution and I look forward to the Secretary of State's reply.

Manufacturing industry in Scotland directly employs 290,000 people. A further 150,000 jobs are indirectly supported by the sector. In total, that is almost 20 per cent. of the work force in Scotland. That is well down on the equivalent figures in the late 1970s and early 1980s, but it is still considerable. Manufacturing accounts for almost 70 per cent. of all exports in Scotland, with the electrical and instrument engineering sector accounting for three quarters of that figure. Other exports include industrial gases, pharmaceuticals, paints, coatings and metal products.

I turn now to the textiles industry, which is the fourth largest sector in Scottish manufacturing. We have already had one debate this morning on textiles and my hon. Friend the Member for Tweeddale, Ettrick and Lauderdale (Mr. Moore) set out the particular problems that constituencies such as his in the borders are suffering. I shall not repeat the arguments, so I hope that the Secretary of State will understand if I do not refer too often to textiles, important as they are to Scotland.

A trawl through business news stories in Scotland over the past few years unveiled alarming events. However, for me, the problems in Scottish manufacturing manifested themselves abruptly when Continental Tyres suddenly announced the closure of its factory in Newbridge in 1999. Although I was not a Member of Parliament at the time, as a local councillor and someone who worked closely with the then hon. Member, Donald Gorrie, and a Member of the Scottish Parliament, Margaret Smith, I remember the devastating impact that that decision had on the people of Newbridge and surrounding villages. All in all, almost 800 jobs were lost and one of the community's major employers disappeared from the area. From then on, we in Scotland experienced announcement after announcement, job cuts after job cuts and closure after closure.

In 2001, despite the direct involvement of the Prime Minister and £20 million of Government grants, the mobile phone company, Motorola, confirmed its intention to close its factory at Bathgate to the west of my constituency in west Lothian. A local union official said that the whole community had depended on the plant and that the area would now be destroyed. Three months later, west Lothian was hit again when the electronics firm, NEC, announced 600 job losses at its plant in Livingston. The United Kingdom managing director of the company said that the semi-conductor trading situation was the worst ever encountered by the industry. Some people have been over-pessimistic about the situation in west Lothian. Its ability to recover has impressed many.

In November of that year came the announcement of Rolls-Royce to cut 400 jobs at its Hillington factory outside Glasgow after a downturn in the airline industry after 11 September.

This year, the trend has continued. In May, Newbridge in my constituency was hit again following the decision by Grampian Foods to close its Edinburgh site in what the Scottish Executive described as yet another "severe blow" to the area. More than 1,000 jobs have been lost in a year. Elsewhere, 650 jobs have been lost at the Erskine plant of Compaq—the computer firm—in addition to the 700 jobs that were lost the year before. About 400 jobs were cut when the Sanmina-SCI plant in Irvine closed, and Chunghwa Picture Tubes cut 600 jobs at Mossend in north Lanarkshire. NCR—the Dundee cash machine company and electronics firm—cut 150 jobs. Last week, APW Enclosures announced a plan to close its Scottish plant at Hamilton, with the loss of a further 300 jobs. It blamed the closure on the worst ever downturn in global information technology and computer markets.

I managed to get a note from the Library that sums up the whole matter. It shows the scale of the decline in manufacturing in Scotland. Between 1998 and the summer of 2002, more than 100,000 jobs in total have been lost in manufacturing, more than 30,000 of which were lost in the past year alone. Those are worrying figures, and I do not agree with those who say that the service sector can fill the gap created by the fall in manufacturing. Frankly, that could not happen, and even if it could, I doubt whether it is desirable. It is bad for the health of the economy for Scotland to be a nation of call centres. That is not to decry service sector jobs. In my constituency, for example, we hope that the completion of the Royal Bank of Scotland's global headquarters will give rise to the creation of a further 3,000 jobs. As the Select Committee on Trade and Industry commented, manufacturing output supports a large number of service sector jobs. A strong manufacturing sector is crucial if we are to create the knowledge-based economy that we all want.

The Secretary of State for Trade and Industry admitted that the Government have made mistakes. In particular, she admitted that they had given the impression that they had given up on manufacturing. At the Labour party conference in Brighton, she said:

"We allowed the impression to grow that manufacturing did not matter … We had bought into the myth that manufacturing was a thing of the past."

I respect the Secretary of State's honesty and courage in admitting that mistakes have been made. However, I look forward to hearing the Minister say today that lessons have been learned from those mistakes.

In June, the Trade and Industry Committee produced a thorough report on the manufacturing industry in the United Kingdom. It produced several key recommendations. I accept that they are not all the Government's responsibility, but the report posed some difficult and challenging questions for the Government to answer. The Committee found that the major obstacle to improving manufacturing was the longstanding shortfall in capital investment, which creates a serious challenge for the country's financial sector. It also found that UK companies find investment more expensive to service than do their European or American competitors.

It is clear that UK banks must re-examine their attitude to manufacturing and become more flexible and focused on the long term when considering their lending policies. I am keen to hear the Minister tell us what steps the Government are taking to encourage this sea change in attitude.

I welcomed the Government's manufacturing strategy paper, which they produced in May, and the seven pillars that the DTI believes are the basis for a successful future for manufacturing. I hope that the Secretary of State will accept that it will take much more than words on paper to turn round the fortunes of the manufacturing industries, and I look forward to the right hon. Lady telling us what steps have been taken some seven months since the paper was published. I note with interest, however, that the first of the Government's seven pillars is macro-economic stability. That contrasts with paragraph 16 on page 10 of the Committee's report, which says:

"While we welcome the long-term macro-economic stability to which the Government is committed, we note that the stability achieved over the period 1997–2002 has not been accompanied by an increase in productivity in the manufacturing sector. In fact, the reverse has applied."

I was also interested to note that the Committee reported the experience of business and the unions, which found the burden of regulation in the UK to be considerable. They called for further relaxation of the administrative burden. Clearly, the Committee felt that it was an important issue, but none of the seven pillars in the Government strategy paper appears to deal with it, which is odd, given that the matter falls so clearly under DTI responsibility.

I should not have been surprised either by the lack of mention of the euro. Irrespective of whether one is in favour or against it, the on-going uncertainty is at best unhelpful and at worst detrimental to the long-term strategic planning of business.

Globalisation has brought new opportunities for Scotland, but it has also brought new challenges. The increase in international competition has forced many companies to adopt even more efficient practices and structures and to produce cheaper goods of higher quality, which is not an easy square to circle. However, it remains clear that many companies have yet to adopt the best practice, which has been shown to improve productivity. The manufacturing advisory service clearly believes that companies can and should make greater use of lean manufacturing techniques and increased investment in information technology. I look forward to hearing what the Government are doing to help business in that regard.

Both the CBI and the National Skills Task Force highlighted the importance of making real improvements in the training of key management within companies. Responsibility for providing training and skills for workers and management in Scotland also falls under the Scottish Executive. There remains a need for work across government to ensure that the necessary skills are available to develop manufacturing. Once again, I am keen to establish what the Government have achieved in conjunction with the Scottish Executive.

Last August, the Centre for Economic Policy Research produced a report on Scottish manufacturing. I did not agree with the request for the Scottish Executive to cut income tax by 3p to encourage entrepreneurship. A year ago, the manufacturing summit concluded that the future for manufacturing lay in high technology, but that such a future would be realised only if there were investment in a high skill base. It will be no surprise that I, a Liberal Democrat, would rather see investment in education, training, IT and transport infrastructure before any tax cut.

I also agree with the Federation of Small Businesses in Scotland when it said that the attacks were "misplaced" and that responsibility for red tape and employment and environmental legislation lies with Westminster and the EU, not with the Scottish Executive.

Before concluding, I accept that it would be wrong to pretend that the entire picture is doom and gloom. To be fair to the industry and to the Government, it is not all negative. The October announcement of new money to set up a wind turbine and generator engineering operation on the Isle of Lewes offers potential for new job opportunities in the area and will mean the reopening of the Arnish oil fabrication yard in Stornoway, which was closed three years ago.

The renewable energy sector has enormous untapped potential in Scotland and offers real promise for a boost to Scotland's manufacturing. It is widely accepted that Scotland has enormous strategic potential for making use of renewable resources. It offers Scotland exciting new possibilities and a prize that is there for the taking, if the Government, the Scottish Executive, local government and industry have the courage and determination to go out and win it.

Scotland's enterprise companies should now be actively and aggressively pursuing the manufacturing capability of engineering components to harness wind energy. From there, the construction of large-scale wave energy and tidal stream devices could provide further long-term stability for the manufacturing sector. Such success would require real direction and support from the Government, for which I look to the Minister today.

Aside from renewables, it would be wrong not to highlight the new Rolls-Royce £85 million manufacturing centre near Glasgow airport, which will provide a welcome and much needed boost to the area. The managing director, Royan Anthony, said that the plans would provide a new centre of excellence for aerospace component manufacturing in Scotland. I wish the project well.

Closer to my own constituency, firms such as Excell Biotech in Livingston are flourishing in the expanding biotech market and making drugs that many of us hope will one day combat cancer and cystic fibrosis. There are good news stories, and it is important for balance, for the industry and for Scotland that they are highlighted. Regrettably, however, such announcements are fairly few and fail to make up for the on-going job losses across the industry.

I am conscious of the time and want to ensure that the Secretary of State has adequate time to address the points that I have raised. In conclusion, I have noticed in many instances that when anyone dares to utter concerns about the Scottish economy, they are rubbished as talking down Scotland. I hope that the right hon. Lady accepts that I have not done that today; I have merely tried to raise real concerns that I and many other hon. Members have about the problems in Scottish manufacturing and the trends in the industry over the past few years.

I congratulate the hon. Gentleman on securing the debate and on the way in which he has introduced it. I share his concerns about the industry, but I want to highlight one or two of the points that he made. Does he accept that a key indicator for measuring the success of the economy is whether unemployment levels are better now than they were in, say, 1997? I think that the hon. Gentleman will accept that they are. With regard to a sound economic policy, will he also accept that we could not measure the type of unemployment figures that he may be considering, although he may have had slightly better manufacturing—

Order. This is a rather long intervention.

May I just say—

Order. This intervention is becoming a speech, and Mr. Barrett has the floor.

I take the points that the hon. Member for Central Fife (Mr. MacDougall) raises. When it comes to improvements in unemployment levels, whether in manufacturing industry or in the growing service sector, it is important to consider the overall picture. The picture is certainly not of doom and gloom: there are some areas where there is real growth in the service sector. In my constituency in Edinburgh, and particularly on the west side of Edinburgh, there is phenomenal growth in the service sector, but there are other areas in Scotland.

As I said at the beginning, I requested the debate not to raise the parochial interests of my constituency, but to raise wider concerns about those areas in Scotland where manufacturing is vital. In some areas, the work force that has been employed in manufacturing would like to see a continuation of manufacturing jobs, not a move to call centres only. I look forward to hearing the Secretary of States reply to the points that I have raised.

I congratulate the hon. Member for Edinburgh, West (John Barrett) on eventually securing the debate; I did not realise that it had taken him so long to come up in the ballot. I also congratulate him on a balanced speech. I was a little worried when I heard the hon. Gentleman's opening remarks: if he was trying to get on the right side of the Minister, he was not exactly going the right way about it. However, the speech was extremely balanced, as I said, and I would expect nothing less of him.

I am glad that the hon. Gentleman pointed out the success of economic policies affecting his constituency, because the unemployment rate there is 2 per cent. It has fallen by almost 35 per cent. since 1998 and is an exemplar of what can be achieved in a community that has much of its basis in the service industry, not least the financial services sector.

The hon. Gentleman also referred to the biotech industries, which are showing unprecedented growth in Scotland. Indeed, the growth of biotechnology in Scotland is outstripping growth throughout the European Union at something like 30 per cent. per annum, and we feel greatly encouraged by that. We are similarly encouraged by what is happening on software, despite the terrible catastrophe that happened in Edinburgh at the weekend and our anxieties about the artificial intelligence department at Edinburgh university. I hope that we will have reassuring news about that before too long.

Let me put the hon. Gentleman's remarks in context. I agree entirely with the statistic that he uses for manufacturing, and about the importance of the manufacturing sector to Scotland. I will not pretend that there are no difficulties, because the difficulties are apparent to all. Like the rest of the United Kingdom and, indeed, all the major economies throughout the developed world, Scotland has seen manufacturing companies struggle. In Germany, manufacturing output fell by 5 per cent. It fell by 6 per cent. in the USA, 14 per cent. in Japan and in the UK overall it is down by 5.5 per cent. He is concerned, as I am, about the fall in Scottish manufacturing output for the eight successive quarters up to 2002 and he acknowledges the impact of restructuring in the electronics sector. Our vulnerability in that sector is well recognised.

It is reassuring that the sharp decline in output was halted in the latest quarter. It was 0.2 per cent. down in quarter two, compared with quarter one, but there is no scope for complacency. Indeed, a large number of issues need to be addressed in a completely non-partisan way. They have been live in the Scottish economy for many years. There are structural issues about levels of skill, training and the nature of past investment in the Scottish economy. Our vulnerability to electronics, which we welcomed with open arms when that development came to Scotland, has meant that the corporate sector has perhaps not put enough emphasis on research and development.

I am delighted that my right hon. Friend the Chancellor of the Exchequer in his last Budget extended the research and development assistance available to small firms to larger firms to ensure a bigger input of research and development activity in Scotland. Indeed, my friend and colleague, the First Minister of Scotland, is in Dundee today inaugurating a new intermediary technologies institute, which will help to stimulate research and development out of our universities to help industry on the ground to get that competitive edge.

There are specific issues relating to competition globally that we have to take into account. A number of low-cost labour markets that are anxious to secure manufacturing development are emerging. They include not just India and China, but the accession states into the European Union. That offers us an opportunity in that it expands markets, but it poses a challenge too. The main way to meet that challenge is through high added value. Scottish manufacturing has been highly successful in the high added value end of the market.

I am not sure whether British Aerospace is in the hon. Gentleman's constituency or in the one adjacent to it. I was privileged to visit there recently to see the Eurofighter helmet, which is a world-beating example of Scottish engineering, manufacturing and research and development. That kind of development will never be the volume development that we have been used to in the past. We have to seek a situation where we can develop more broadly our manufacturing output.

While we are talking about the plight of the manufacturing sector in Scotland, will the right hon. Lady accept that as the greater part of Scotland's exports go to European Union member states, being outwith the eurozone is deeply damaging to Scotland's economy?

I note the significance that the hon. Lady attaches to the single currency. As a Government we are in favour in principle of joining a single currency, provided that the economic conditions are right. That is a very important point for Scottish manufacturing. We must be confident that the economic conditions are right. My right hon. Friend the Chancellor has made it clear that he will evaluate the five economic tests between now and June 2003.

To look on the positive side—the hon. Gentleman was very fair in doing that—new technologies are transforming manufacturing as much as every other sector. We have to welcome the extent to which manufacturers are themselves embracing new technologies. I have one criticism. Everyone knocks call centres. People should bear in mind that many of the jobs in call centres, such as those in my constituency, are high-level jobs often filled by graduates and those with language and accountancy skills. They are significant generators of employment.

Will the right hon. Lady also agree that in many areas where manufacturing has been the traditional employment, the change to sitting in a call centre at an office-based computer is not the way forward?

I would disagree with the hon. Gentleman. We must get away from the notion that you have to get dirty to have a good job. There are good jobs, where you do not necessarily get dirty, which have a high skill component. It is a tribute to people who have been prepared to change their careers that they have moved on to such employment. The hon. Gentleman cited Motorola and Continental Tyres; they are examples of where, with a co-operative partnership, effort by the Scottish Executive, the Department of Employment, the local authority and local employers, the majority of people can rapidly be found new employment. We congratulate people on doing that.

As the hon. Gentleman acknowledged, the Government published the manufacturing strategy in May, strongly supported by many manufacturers, trade associations and the trade unions. About 18 months ago, our colleagues in the Scottish Executive published their own booklet entitled "Created in Scotland: the way forward for Scottish Manufacturing in the 21st Century". The Government and the Scottish Executive are committed to working together to harness the best of our high-skilled work force to ensure a future for manufacturing industry.

The hon. Gentleman almost dismissed in passing the impact of economic stability. Because we have had five years of macro-economic stability there is a danger that we take it for granted. Think back to the days when interest rates were 15 per cent. and think of the consequences that that had for industrial investment. The hon. Gentleman talked about capital investment; in his pre-Budget report, my right hon. Friend the Chancellor of the Exchequer made much of his attempts to encourage capital formation on the part of UK companies, and that capital formation is made a lot easier because we have had the longest period of sustained low inflation since the 1960s. Inflation has remained within the narrow band of between 1.5 per cent. and 3.2 per cent. since the 1997 election. That is a crucial platform for manufacturing industry for investment, innovation and enterprise in British and Scottish manufacturing.

I wonder whether the hon. Gentleman spotted a piece in yesterday's "Business a.m." about the poor take-up of the research and development tax credit in Scotland. That is an issue for us; we should all be working together to encourage Scottish companies to take advantage of the available opportunities and funding. I take the point that we must look at new means of encouraging companies to invest. The best way to do so is to allow them to keep more of the money that they earn. That is why the Government have reduced corporation tax. The UK now has the lowest ever corporation tax rates for small companies and the lowest starting rate among major industrialised countries.

Budget 2002 introduced a zero starting rate, which is very important. Many small companies in Scotland are unincorporated and as such they depend on low levels of personal taxation, which is aimed at helping them to get the necessary capital to allow their businesses to function.

I entirely take the hon. Gentleman's point about regulation. The Government are committed to ensuring that regulations are fair and effective, so that they protect the vulnerable but do not stifle enterprise or productivity. Our policy is to regulate only when necessary, and we have significantly strengthened the systems that control the regulatory burden. We are recognised as providing a more entrepreneur-friendly environment than the United States and many other major EU countries, and fostering growth companies more effectively, as a recent survey shows. We work hard with the Scottish Executive at improving regulation.

Many of the drivers of significant change in the manufacturing sector relate to skills and the Scottish Executive has been upfront in taking forward the skills agenda. It is taking steps to drive forward productivity growth, working with the Government. With the Minister for Enterprise and Lifelong Learning, I met the Chancellor yesterday specifically to talk about the productivity agenda and to discuss how we promote enterprise, innovation and skills throughout the country. Lifelong learning, which is driven in Scotland by the Scottish Executive, is a key to the Government's economic strategy. That partnership between the Executive and the Government is critical in driving forward the productivity agenda. The Government spend about £1.3 billion on in-work related training in Scotland. Learndirect is the Scottish Executive's one-stop shop to encourage people into learning.

The hon. Gentleman's points, which he raised in a very balanced way, are extremely important. We have to sit down and work out the inhibitors to productivity growth, and then work together to attack those inhibitors. The debate has been around for the better part of 30 years; we should now move towards a solution. I congratulate the hon. Gentleman again.

Twice in recent years I have suffered from a medical condition that affects around 100,000 men, women and children in this country every year. Its name is lymphoedema and it has a frequent associate, cellulitis. Very few people who have not known the condition in their immediate family would be able to name it or describe it. In brief, it is a chronic swelling due to the failure of the lymphatic system to drain properly.

The lymphatic system pervades our whole body and usually receives only cursory coverage during the training of general practitioners. Usually, when the lymphatic system is working properly, a clear liquid is squeezed from blood capillaries into our tissues by the pressure of the heart's pumping and it bathes all the living cells in our body. That liquid then flows back into the lymphatic ducts and is returned to the blood system through the lymph nodes in our groin, chest and armpits. The lymphatic system is part of our immune system, which is why infection is so common when it is working at less than 100 per cent. efficiency.

It is amazing that so few conditions that affect the lymphatic system are recognised as key areas for medical study or feature in the popular vocabulary. Contrary to the situation in some other European countries, I understand that no specialist lymphological consultants are employed in any hospital or university in this country.

Lymphoedema is typically associated with women who have had breast cancer and have suffered consequent damage to their lymphatic system from the cancer, from surgery or from radiography. It can be a chronic condition or it can be a one-off. It can come and go. The associated infection—the non-specific infection called cellulitis—can be excruciating, chronic and, in some cases, life-threatening. However, the condition is not exclusively related to cancer, as my own experience shows.

One evening in 1995, I developed an inexplicable fever and a terrible feeling of cold. That passed after a few hours, but by the next day a tickling sensation in one leg was followed by a swelling in my calf. By the following evening, a severe swelling and red discoloration of my entire leg had caused lameness. By the third day, the fever had returned, the swelling was worse and red lines were visible all the way up to my thighs, tracking the lymphatic vessels in the general direction of my kidneys. This was cellulitis. I was finally persuaded to see a doctor. I was rushed to hospital. Within an hour, I was completely lame and, by evening, my temperature had reached 104° F. I was given eight intravenous antibiotic injections every day for the next week. It was 10 days before I could walk again and I had to use walking sticks for about six weeks.

Apart from the intravenous antibiotics, the only treatment that I had was to have my leg elevated to help the drainage. I was given no massage, no physiotherapy and no advice on how to prevent the circumstances from arising again. However, at least I recovered. Interestingly, the word lymphoedema was not used throughout the period that I was in hospital.

In the middle of the general election campaign, it happened again. One afternoon, at 12.30 pm, I felt ill; at 2.30 pm, I phoned NHS Direct; by 4.30 pm, I had been diagnosed with cellulitis again and was back in hospital; and, by 6.30 pm, I was having intravenous antibiotics and my temperature had shot up yet again. However, this time I had recognised the symptoms and taken swifter action. NHS Direct had done its job and, although the symptoms were just as bad as before, at least my recovery time—just two or three weeks—was significantly faster.

Since that time, I have altered my lifestyle a little. I pay a sports masseur for a deep lymphatic massage two or three times a year. She often reports fluid retention that I was not aware of in my leg, and she shifts it manually. I have regular pedicures to keep the skin of my feet supple and to prevent it from cracking—which makes it more difficult for microbes to enter the skin.

Two episodes of cellulitis linked to lymphoedema have scared me so much that I do not want to go through that again. I am more acutely aware that lymphoedema is a chronic condition and a fact of life for some people and that cellulitis is therefore a constant risk.

I do not want to criticise the medical staff who treated me but I now understand the concerns of bodies such as the lymphoedema support network, which is a voluntary sector organisation that advocates and encourages self-help for lymphoedema sufferers and campaigns for better medical understanding and care. Most of its work is done with chronic lymphoedema sufferers. It believes that insufficient is being done to counsel sufferers on ways to avoid flare-ups of lymphoedema or cellulitis. It believes that the non-specific bacterial infection that causes cellulitis never really goes away in many cases. It also believes that there is widespread ignorance of prophylaxis in the medical professions.

For example, the network advises lymphoedema sufferers to keep a two-week supply of antibiotic tablets handy to treat cellulitis immediately, if it arises. However, it is very rare to find a general practitioner who will prescribe antibiotics under such circumstances.

The Under-Secretary of State for Health, my hon. Friend the Member for Salford (Ms Blears), in a written answer last year said:

"specialist nurse training"—

for lymphoedema—

"is carried out mainly in the charitable sector by organisations such as Macmillan Cancer Relief and Marie Curie Cancer Care."—[Official Report, 23 November 2001; Vol. 375, c. 570W.]

That reflects the high incidence of lymphoedema among cancer patients, and especially the one in four breast cancer patients who suffer from it. There is increasing evidence that prostate and gynaecological cancer patients are at a significant risk of lymphoedema and cellulites, although cancer specialists in our hospitals have little professional expertise in treating lymphoedema, with a few notable exceptions. People who have had their spleen damaged or removed are under an equivalent risk of the condition and the infection. However, private health insurers avoid lymphoedema and cellulitis like the plague, and people who suffer from the conditions find it very difficult to get private health insurance.

About 1 per cent. of pensioners in this country suffer from swelling that could be treated by specific physical therapy designed to improve lymph drainage, such as massage. Diuretics and prolonged treatment using pressure pumps are often wrongly prescribed by GPs to treat such swelling. They can, and do, cause further damage to such patients. Too many patients find that lymphatic clinics are simply not available, and even if they are, consultants and GPs alike are not always aware of their existence and do not routinely refer lymphoedema patients there.

A week's occupancy of a hospital bed taking antibiotics intravenously—as I did twice—is a very inefficient way of treating a condition that is relatively simple to avoid and of which it is relatively easy to identify high-risk patients. The present reactive response of treating the condition after it has arisen rather than preventing it makes no sense from a cost perspective. I might add, to give an international scale, that elephantiasis—the Minister will be familiar with it—which is a swelling of the legs commonly associated with water-borne tropical diseases, is an extreme and chronic form of lymphoedema that causes permanent changes to the tissues of the limbs and affects about 40 million people throughout the world.

The British Lymphology Society says that the treatment of lymphoedema should be relatively simple. It should consist of skin care to maintain good tissue condition and to reduce the risk of infection. External support and elastic compression garments, which can he used throughout the entire life of a person with a chronic condition, should be used to reduce lymph formation and to enhance its drainage capacity. There should be a programme of exercise to maximise lymph drainage without overexertion. Lymphatic drainage by simple hand movements that are designed to be easily accessible to patients and their relatives should be taught, because that allows people to self-massage to keep the lymph flowing. There should be prompt administration of antibiotics to cure cellulitis and to ensure that, if there is the risk of recurrent attacks, a prophylactic approach of taking antibiotics in advance of the problem arising should be adopted.

Clinics with experience of treating lymphoedema are listed on the BLS website. In the whole of Greater Manchester, only three national health service facilities are listed—predominantly associated with cancer—and only two in my county of Derbyshire. Lymphoedema patients who do not have cancer may not have access to the people who are likely to be able to refer them with knowledge to the correct clinic for the correct treatment. Every general practitioner's surgery should be able to offer such good quality advice to patients with lymphoedema, but that is not the case.

I end by putting seven specific questions to my hon. Friend the Minister. Why are statistics related to lymphoedema not collected centrally and not maintained by the NHS? Why is there no official NHS guidance on the treatment of lymphoedema? What plans does he have to ensure that lymphology has a higher profile in terms of GP training and academic research, perhaps through the creation of a chair of lymphology at a major training institution?

Will lymphoedema be specifically included in the preparations for the national service framework for long-term conditions, and, if not, why not? Is my hon. Friend satisfied that the onus for medical care of lymphoedema patients appears to rest on nurses and the charitable and voluntary sectors rather than GPs in the NHS? Do patients receive specific guidance to access nurse services?

How can additional funding be provided not only for the treatment of lymphoedema, but for advice? The lymphoedema support network itself could be funded—it receives some 2,000 referrals for advice each year but has no statutory funding. The number of referrals is a fraction of the estimated 100,000 people who suffer from the condition each year.

I thank my hon. Friend the Minister for his attention in the debate. He will know that lymphoedema is a major concern to many people. However, it is largely ignored by a medical establishment that simply does not find the condition sexy enough to develop a proper strategy for patients who are at risk of, or suffering from, a condition that is at best uncomfortable and unpleasant, and, at worst, very dangerous. Having suffered the condition myself, and knowing the pain and discomfort that it can bring over a long period, I hope that my hon. Friend the Minister will respond positively to my points.

I commend my hon. Friend the Member for High Peak (Mr. Levitt) on securing this debate. All hon. Members will be sorry to hear that he suffers from lymphoedema. He describes in the most moving way how distressing the disease can be as well as the pain and the swelling of the limbs and the body that go with the complaint. There are many types of lymphoedema, including primary and secondary. The lymphoedema support network estimates that 2 per cent. of the United Kingdom population could be affected. My hon. Friend draws attention to the website.

There is currently no cure, but lymphoedema can be well managed with appropriate treatment. As my hon. Friend explained, such treatments consist of a combination of skin care, exercise, massage and compression garments or bandaging. In a few cases, it is possible to help surgically, for example, by transplanting lymph vessels.

My hon. Friend asked why we do not collect and maintain statistics on individual conditions such as lymphoedema. I understand why he, other hon. Members and voluntary organisations would like to have such information. However, I am sure that he will appreciate that we do not ask the NHS to compile such statistics because of the enormous range of conditions and diseases that exist.

Order. I ask the Minister to speak nearer to the microphone, as the Hansard reporter is having difficulty in hearing him.

The administrative burden of developing and maintaining a conditions database would be huge and tremendously expensive, and it would divert energy and resources away from the main function of the NHS, which is treating patients.

However, we do have some statistics on finished consultant episodes of lymphoedema that I can share with the House. A finished consultant episode is defined as a period of patient care under one consultant in one health care provider. The figures do not represent the number of patients, as one person might have several episodes within a year, but they show that since 1996 there have been around 2,000 such episodes a year.

Treatment for lymphoedema is generally seen as a supportive therapy. Good management will enhance the patient's quality of life and reduce morbidity. The condition can include infection, which sometimes leads to prolonged hospital admissions.

I am sure that my hon. Friend would wish to confirm that consultant episodes are a very small minority of all of the episodes, the vast majority of which would never reach consultant stage.

My hon. Friend is correct. The condition pertains to both secondary and primary care. The information that the NHS currently collects shows that 2,000 people receive secondary care, so it is clear that that figure represents less than the overall total.

My hon. Friend expressed concern about the fact that nurses are largely involved in the care of patients with lymphoedema. I think and hope that he will agree that once the initial diagnosis is confirmed, nurses should be able to manage the day-to-day treatment of patients with lymphoedema—or of some of them, at least. However, there will always be support from doctors, if that becomes necessary.

After diagnosis, patients will be able to access the full range of appropriate NHS services. If that is not the case, it is important that all of our constituents ensure that they are communicating with our new primary care trusts. We have devolved power in the NHS to those local trusts and they should be ensuring that the ranges of services from primary care through to secondary care, and their relationships with local hospitals, are bearing dividends for patients with this chronic disease.

My hon. Friend talked about poor service provision in the NHS. We start from a particular base, and I hope that the extra resources that we are putting into the NHS—such as the £40 billion that my right hon. Friend the Chancellor announced earlier this year—along with the reform, will bring better services across the board for patients with lymphoedema, and for others. That is our wish. We are all proud of our NHS, but it can do better.

I am, however, pleased to say that there are many examples of good practice throughout the country. I will mention two. In 1997 a clinic was established at St. George's Healthcare NHS trust to treat patients with primary lymphoedema and cancer. Other clinics in south-west London treat patients with cancer and lymphoedema, but the St. George's service also meets the particular needs of patients with non-cancer lymphoedema. St. George's provides a specialist service and receives nationwide referrals. That trust is also one of the places where academic and epidemiological work related to lymphoedema is progressing, including a recent study run by the lymphoedema epidemiology project group. Another good service is based at Arthur Rank house in Cambridge, where lymphoedema services are provided for patients with primary, secondary and palliative lymphoedema.

My hon. Friend asked for guidance on the treatment of lymphoedema to be made available to the NHS. I sympathise with that request. Although lymphoedema is a condition that is well understood and managed in the NHS, extra guidance would help raise the profile of that condition.

The National Institute for Clinical Excellence is currently developing guidance for supportive and palliative care as part of its cancer service delivery programme of work. That will provide guidance on best practice in supportive care for all cancers. The areas covered will include evidence-based recommendations for supportive care networks; information delivery and communication; inter-professional communications; symptom control and access to specialist palliative care. The guidance will underpin the development of supportive and palliative care strategy, which is one of the national cancer director's top priorities. It will complement the guidance relating to the current programme of cancer service delivery that covers the treatment of the main tumour groups. The guidance will help people with primary and secondary lymphoedema. I also understand that the British Lymphology Society has produced guidance on the use of manual lymphatic drainage and simple lymphatic drainage for lymphoedema, which can be downloaded from the BLS website. There is also a useful section on lymphoedema on the NHS Direct website.

My hon. Friend mentioned raising the profile of lymphology through GP education and academic research. I hope to deal with research later on, but I agree that the availability of appropriately trained staff is one of the key determinants of the quality of the care that a patient receives. Medical education is a continuum that begins at medical school and continues through basic and higher training and beyond through continuing professional development. Most doctors who are trained in the UK will work primarily in the NHS, so it is essential that the priorities of the NHS are identified and integrated throughout the training continuum. I hope that my hon. Friend will agree that the responsibility for the content, standards, management and delivery of medical education is properly shared between the professional regulatory bodies and others.

It is not practicable or possible, nor is it desirable, for the Government to prescribe exactly the training that each doctor should receive. There is no syllabus for general practice training. The training that each GP receives depends on the case mix and the patients that he or she sees during their time as a general practice registrar. Training for GPs will, however, always deal with a broad spectrum of health problems and will include information about the treatment and management of patients, their families and their carers. I am, as I have already said, sympathetic to what my hon. Friend suggests and I recommend that he take the matter up with the Royal College of Physicians. I can, of course, make a copy of this debate available to that society.

I have heard what my hon. Friend said about research. Recent research that has been carried out in Australia into the molecular mechanisms that control blood vessel growth has led to the identification of molecules that also regulate development and growth of the lymphatic vessels. That is generating a great deal of interest in the molecular control of lymphatics.

I hope that, over time, such research will provide a breakthrough in the understanding and treatment of lymphoedema. We must be realistic about such a process, however, and make sure that people understand that scientists are not offering immediate solutions. That research approach is no magic wand and it may be some years before an effective drug becomes available. Nevertheless, it is an important development and we remain in close touch with what goes on throughout the world.

The main research agency in this country through which the Government support medical and clinical research is the Medical Research Council, an independent body that receives grant in aid from the Office of Science and Technology. The MRC is not currently funding any research into lymphoedema. It did, however, fund a two-year trial entitled "Hyperbaric oxygen therapy for chronic complications of radiotherapy in breast cancer patients". The trial ended in December last year and it is being followed up.

Since 1997, more than 30 research projects on lymphoedema have been carried out within the national health service or are ongoing. The largest of them are funded by charities, in particular, the Wellcome Trust. The Department meets the costs to the NHS in supporting the research. The remainder are carried out in-house with no direct funding. In addition, the Engineering and Physical Sciences Research Council has recently awarded a grant of £262,225 to the Institute of Cancer Research. The project will develop advanced imaging techniques for the clinical assessment of lymphoedema and tissue fibrosis that occur as side effects of breast cancer treatment.

The MRC always welcomes high-quality applications for support into any aspect of human health, including lymphoedema. They are judged in open competition with other demands on funding. The MRC does not as a rule earmark funds for particular topics, such as lymphoedema. When appropriate, high-quality research in all areas that the MRC is promoting may be given priority in competition for funds, but research excellence and importance to health will continue to be the primary considerations when making funding decisions. I will ensure that the chief medical officer brings the debate and my hon. Friend's request for more research into lymphoedema to the attention of the Medical Research Council.

My hon. Friend asked whether lymphoedema would be included in the national service framework for longterm conditions. National service frameworks are set out in the White Paper "The New NHS", and they are intended to set national standards and define service models for particular services or care groups. The NSF for long-term conditions will have a particular focus on the needs of people with neurological conditions and brain and spinal injury. We are also clear that that NSF must tackle some of the generic issues that affect a wide range of people with long-term conditions as well as their families and carers. It will not address lymphoedema directly, but the NSF is likely to set some general standards that will improve the quality of treatment and care for all people with long-term conditions.

My hon. Friend asked about sources of funding for voluntary sector organisations. The Department runs an annual award scheme, the section 64 general scheme, which represents the greatest single source of financial support that the Department provides to the voluntary sector. The closing date for this year's exercise has now passed, but there is nothing to stop voluntary organisations active in lymphoedema from applying in next year's round. In 2001–l02, 575 grants totalling £21 million were awarded to about 400 voluntary organisations.

I hope that my hon. Friend will agree that we are providing services that help patients cope with lymphoedema and that developments in research offer some hope for the future.

Question put and agreed to.

Adjourned accordingly at one minute to Two o'clock.