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Funding for counter-terrorism programmes in Pakistan, named by Gordon Brown as the biggest threat to the Britain, have been cut back, the Government has admitted.
Published: 6:53PM GMT 20 Jan 2010
Foreign Office Minister Baroness Kinnock of Holyhead said programmes in counter-terrorism and radicalisation in Pakistan had been cut as the Foreign Office tried to deal with a shortfall of £110 million this year.
She blamed the decision on the decline in value of the pound on foreign exchange markets.
Her comments in the House of Lords came hours after the Prime Minister made a statement in the Commons saying that the ''crucible of terrorism'' on the Afghan-Pakistan border remained the ''number one security threat to the West''.
Shadow foreign secretary William Hague seized on the minister's remarks, saying: ''Pakistan has been identified as one of the major sources of the terrorist threat to this country.
''Cutting FCO expenditure on counter-terrorism programmes in Pakistan because of the movement of exchange rates is clearly not the way to run an effective foreign policy.''
At Lords question time, Lady Kinnock outlined a string of areas that have faced cuts due to the shortfall.
She told peers: ''As a result of exchange rate movements, the FCO faces a shortfall in 2009-10 of an estimated £110 million; we estimate this shortfall will increase slightly in 2010-11.''
She added: ''We have had staff redundancies in Argentina, Japan and across the United States.
''Programmes in Afghanistan in counter narcotics have been cut, capacity building to prevent conflicts in Africa, counter-terrorism and radicalisation in Pakistan, the list goes on.''
Labour's Lord Acton demanded: ''Did you say that counter-terrorism in Pakistan had been cut? And if so would you say whether this is really wise and would you consider looking at it again?''
Lady Kinnock replied: ''It is a fact that counter-terrorism and radicalisation projects in Pakistan and elsewhere have been the subject of these cuts that the Foreign Office has been obliged to make.''
Lord Wallace of Saltaire, for Liberal Democrats, said he calculated there had been a ''20% cut'' in the effective budget of the FCO since the Treasury removed the system in 2007 whereby it made up for shortfalls that were the result of exchange rate changes - known as the Overseas Price Mechanism.
Mr Hague said the cuts were the ''direct consequence of Labour's decision to remove the FCO's protection against exchange rate movements''.
He said: ''This momentous decision happened on (Foreign Secretary) David Miliband's watch and the buck rests with him. There has never been a full explanation of how this happened and whether Foreign Office ministers took their eye off the ball.
''It is time that the truth is known and the full extent of the damage done to British diplomacy overseas laid bare.''
The admission by Lady Kinnock raised concerns from all sides in the Lords.
Labour's Baroness Symons of Vernham Dean, a former foreign office minister and defence procurement minister, said the Prime Minister's statement - introducing a package of measures to improve security - and Lady Kinnock's remarks did ''not add up to a very coherent point of view''.
She said: ''There should be ring-fencing over the counter-terrorism budget. We can ring-fence other budgets; surely a budget that affects the protection and security of the British people should be the first to be ring-fenced.''
Lords Leader Baroness Royall of Blaisdon said she must ''confess to my surprise earlier also''.
She said counter-terrorism funding in the Home Office was ring-fenced, adding: ''So if it can be ring-fenced in one department, perhaps it could be ring-fenced in another department.
''I really don't know and I can't make the commitment on behalf of the Government but I will certainly take that back.''
Lady Royall assured Lib Dem spokesman Lord McNally that the Government's counter-terrorism work in Pakistan was of the ''utmost importance''.
She said: ''This work is always under review and there have been some projects that have not met the requirement threshold, following the FCO's reduced budget because of the exchange rate charges.
''But I assure you it is an area that we will continue to work (in).''
Tory Baroness Park of Monmouth, former senior MI6 official, said it was ''absolutely vital'' to use every resource possible in fighting terrorism.
''We are essentially going to be blind if the FCO is cut any further,'' she said.
Source : Pakistan counter-terrorism funding has been cut, Government admits - Telegraph
