To ask the Secretary of State for Foreign and Commonwealth Affairs if he will make a statement about monitoring arrangements for the EU-Israel association agreement. [18308]

We, our EU partners and the Commission will monitor closely all aspects of the EU-Israel association agreement when it enters into force, as we do all such agreements.

As the Israeli Government's plans to proceed with the Har Homa settlement have been almost universally denounced—including by the British Government—will my right hon. Friend undertake at the imminent meeting of the political committee of the EU to press for the EU to express its profound Opposition to those plans and for the introduction of extensive monitoring arrangements of the EU-Israel association agreement in all its aspects?

My hon. Friend raised the latter subject when we discussed this matter in Committee. I gave an assurance then that we would look at this matter during the current discussions with our EU partners to ensure that human rights monitoring is carried out as frequently as possible. I hope that progress can be made tomorrow, but that remains to be seen.

As far as Har Homa is concerned, it bears repeating that—as the British ambassador to the UN made clear only last week to the Security Council—we regard all settlement building in occupied territory as illegal and as an obstacle to peace. Har Homa is a particularly sensitive case, because building a settlement there would pre-empt the final status talks concerning the future of Jerusalem.

In view of the Government's unparalleled recent experience of the matter, will the Minister proffer to Prime Minister Netanyahu some advice on how to control an unruly Cabinet without making unreasonable concessions to members of that Cabinet?

The hon. and learned Gentleman should learn a lesson from the Israeli Cabinet—that coalitions, if ever considered, do not work very well.

When people take the easy route of criticising the state of Israel in these matters, while enjoying the peace and security of living in London or Canterbury, will my right hon. Friend remind them that Israel is a democracy, that it has a responsibility to its electorate and that in human rights it has a record that its neighbours would do well to emulate?

My hon. Friend makes an extremely good point. We should never forget that Israel is a genuine democracy and that democracies sometimes throw up rather strange results—happily, for the past 18 years, our democracy has produced the right result. Democracy in Israel is extremely important and I hope that democracy will spread in the Palestinian Authority and that the rights of Palestinians and their legislation will develop accordingly. Human rights are not, after all, subject only to the whims of an electorate, but are of international concern. Both sides in that region should recognise that we take human rights very seriously and that human rights breaches—whether by Israelis or by Palestinians—will be treated equally.

Will the Minister tell us what has been the response of Her Majesty's Government to the rather disturbing development over the weekend, when the United States used its veto in the Security Council to prevent discussion of Israeli policy towards settlements? Is not that a particularly disturbing development, given that Israel's determination to press ahead with Har Homa is not only putting the entire peace process at risk, but—as King Hussein's rather anxious Intervention in the past 24 hours demonstrates—undermining the stability of the whole of the middle east?

I understand the hon. and learned Gentleman's point, but the position of the United Kingdom and the United States are not that far apart. We agree that settlements are an obstacle to peace and that Israeli plans undermine the establishment of the trust that is absolutely vital to the successful negotiation of final status talks. The Americans have made their position clear. I believe that there is not so much a difference of view as a difference of tactics—the difference is one of tactics, not of policy. We both hope that we can persuade Israel to continue with the interim agreement, which is an international treaty, and that peace and prosperity will come to the region.

Will my right hon. Friend confirm that about 70,000 Palestinians currently have permits to work in Israel? Is not the Europe-Israel association agreement designed to create greater prosperity and more jobs, both in Europe and in the middle east, for Palestinians and Israelis? Is not the creation of prosperity the basic building block of peace?

I could not agree more: peace breeds prosperity and prosperity breeds peace. There is no doubt that the EU-Israel association agreement is an important part of helping to spread prosperity between Europe and Israel and I hope that progress on the EU-Palestine agreement will follow. We are pleased that we have agreed with our European partners an initiative, which I believe my right hon. and learned Friend the Secretary of State originated, for the EU special representative in that area to carry out a proper study of the economy of the Palestinian people, because there is little doubt that, unless it improves, frustration will grow, which might result in danger.

The Minister paid tribute to the presence of the EU representative. Will he acknowledge that there is a need for democracy on the Palestinian side? Will he welcome the move for Hamas to become more a political rather than a terrorist group? Will he also recognise, in the light of a concomitant democracy, that proportional representation knocks democracy off its hinges completely, as it places the emphasis on minority groups rather than on the centre?

I shall not, in answer to the hon. Gentleman's last point, comment on electoral systems, which are the choice of the countries concerned. I say only that the hon. Gentleman is right; we need to make progress in all aspects of the peace process. I believe that Mr. Moratinos, the EU special representative, is doing an excellent job. He was here less than two weeks ago, when he met my right hon. and learned Friend the Foreign Secretary and me, and I believe that we have full confidence in what he is doing.