I hope, I just hope, that she's been misquoted by the Telegraph.
The issue of birth-defects and cousin marriage was first raised in parliament two years ago by Ann Cryer, the Labour MP for Keighley in West Yorkshire. She said marriage between cousins was a "to do with a medieval culture where you keep wealth within the family".
She said: "If you go into a paediatric ward in Bradford or Keighley you will find more than half of the kids there are from the Asian community. Since Asians only represent 20-30 per cent of the population, you can see that they are over-represented."
Otherwise, she's a moron. The second paragraph has nothing to do with the first.
Birth rates are not connected to whether or not there is a "close" genetic relationship between the parents. We already know that the birth rates amongst Pakistani born mothers is much, much higher than that of the population at large. So it's not surprising that in an area which is 30% asian, that over 50% of the children born are Asian.
It has nothing - repeat nothing - to do with whether or not the parents are cousins or not. It has everything to do with the wider cultural values that are held by that community. To prove otherwise, you'd have to show that Pakistani couples who are related have a significantly higher birth rate than those who don't. Odds are they don't.