Anti-Terror Spending Cut Row

Planned UK intelligence spending cuts in Pakistan have been criticised by opposition politicians.

Foreign Office minister Baroness Kinnock said the department faced a £110m funding shortfall as a result of the weakening pound.

She said counter-terrorism operations in Pakistan and Afghanistan would be scaled back as a consequence.

Prime Minister Gordon Brown had earlier introduced tougher rules for UK border controls, citing the Afghan-Pakistan region as the "number one security threat".

Liberal Democrats have called on Mr Brown to respond to the proposed spending cuts immediately.

The party's foreign affairs spokesman Ed Davey described the move as "shambolic".

"They have got to reverse these cuts and they have got to explain why they have got this whole thing in such a mess."

A financial system to protect the Foreign Office's finances from fluctuations in currencies is no longer used.

Baroness Kinnock said the department's current shortfall is set to worsen during 2010/11.

She told peers: "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."

Removing the Overseas Price Mechanism in 2007 has effectively cut Foreign Office budgets by 20%, Lib Dem peer Lord Wallace of Saltaire claimed.

Shadow foreign secretary William Hague reacted to Baroness Kinnock's comments by calling on to the Labour Government to "lay bare" the "damage done to British diplomacy".

"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," he said.

The Foreign Office said it was constantly reviewing the precise apportionment of its counter-terrorism spending.

"Pakistan has remained our top priority for counter-terrorism and has rightly been the largest single recipient of our counter-terrorism support throughout this period," a spokeswoman said.

Baroness Royall, Labour leader of the House of Lords, insisted intelligence operations in Pakistan were of the "utmost importance".

Kim Howells, chair of the intelligence and security committee, said she was surprised by the timing of Baroness Kinnock's announcement, but not its content.

"I don't think that this immediately is affecting the hard end of our counter-terrorism activities," said the Labour MP.

(PR/GK)