House of Commons

Tuesday 7th December 2010 Commons Chamber

Tuesday 7 December 2010

The House met at half-past Two o’clock

Prayers

Tuesday 7th December 2010 Commons Chamber

[Mr Speaker in the Chair]

Oral Answers to Questions

Tuesday 7th December 2010 Commons Chamber

The Secretary of State was asked—

[Nigel Adams (Selby and Ainsty) (Con)]

1. What recent assessment he has made of the effectiveness of the operation of the interim cancer drugs fund; and if he will make a statement.

[Alun Cairns (Vale of Glamorgan) (Con)]

12. What recent representations he has received on the operation of the interim cancer drugs fund; and if he will make a statement.

[The Secretary of State for Health (Mr Andrew Lansley)]

Clinically led arrangements are in place in all strategic health authorities for determining the best use of the additional funds that we have made available for cancer drugs from 1 October 2010. Information provided by SHAs shows that, as of 15 November, funding had been agreed for the treatment of more than 250 patients in England. I have received representations from hon. Members, noble Lords, and members of the public on how the interim arrangements for cancer drugs funding are operating. Many of those representations have welcomed the additional support we are giving to cancer patients in need.

[Nigel Adams]

I am grateful to the Secretary of State for his response. Last week, my constituent, Trudy Cusworth, received the news that she is to be given the cancer drug Avastin, despite the panel at St James’s university hospital, Leeds initially refusing to do so. In this case, the emergency cancer drugs fund has done its job, but what can the Secretary of State say to assure other cancer patients in North Yorkshire who are also in desperate need of such life-prolonging drugs and who are currently being denied access to them?

[Mr Lansley]

I am grateful to my hon. Friend for his question. Indeed, I want to thank him for the support he has given to Trudy Cusworth. I am very pleased that she was able to take her case, with her clinicians, to the panel and that it has been approved. There are a number of people in the York and Selby area for whom that is true. The panels are working across the country to ensure additional access to cancer drug treatments where a clinical case is made for that.

[Alun Cairns]

My constituents are pretty angry and disappointed that the cancer drugs fund will not apply to them because health matters have been devolved to the National Assembly for Wales. Will the Secretary of State give an assurance that he will champion the merits of the policy in the hope of convincing the Welsh Assembly Government to follow the lead that he is offering?

[Mr Lansley]

I agree with my hon. Friend, who is obviously an advocate for his constituents to the Welsh Assembly Government. These are matters for the devolved Administrations and they must decide how to allocate their resources. In this instance we have shared with the devolved Administrations the consultation on the cancer drugs fund, which will start next April, although the policy proposed will apply in England alone.

[Toby Perkins (Chesterfield) (Lab)]

2. What recent representations he has received on the effect of the abolition of primary care trusts on the co-ordination of preventive health care.

[The Minister of State, Department of Health (Paul Burstow)]

The Government have set out a number of proposals to support integrated working and preventive action, including ensuring that local councils take a key role in joining up local NHS services, social care and health improvement. There is a strong preventive focus in the NHS public health and social care outcome frameworks, and an additional £1 billion will be provided by 2014-15 for the NHS to support social care. Some of that money will be spent on preventive services. The public health White Paper sets out the Government’s plans to return the leadership of public health to local government. That proposal has been widely welcomed.

[Toby Perkins]

Before the Secretary of State and the Minister embarked upon the biggest reorganisation of the NHS in the past 60 years, what consideration did they give to the impact that such changes will have on the co-ordination of services? Primary care trusts are being described as in meltdown at the moment. PCT staff whom I meet are deeply worried about the co-ordination of services, as linking such services is about so much more than the work of GPs.

[Paul Burstow]

Let me start with the point of agreement: this is about more than just the work of GPs. That is why the Government are proposing the establishment of health and well-being boards in local authorities to drive the integration that was never delivered under the Labour party. Services were not integrated and, for many people, services did not fit around their lives as a consequence. This Government will change that. It seems that the hon. Gentleman is putting forward the campaign slogan, “Save the PCT; don’t trust your GP.” That is not a good campaign slogan.

[Nadine Dorries (Mid Bedfordshire) (Con)]

Will there be £2 billion going into two pots—one for public health and one for social care? What element of that budget will local authorities be able to use for preventive care? Some reports say that the budget is ring-fenced and some say that it is not, so some clarity would be appreciated.

[Paul Burstow]

In fact, there is a further pot of money, which relates to the proposals for a ring-fenced budget in respect of public health. One of the problems has been the NHS’s raiding that pot to spend on other things. We believe that public health is a priority, and we will therefore ring-fence those resources in future. The £1 billion that will go into social care directly through the local government settlement will be available for local government to support social care services. The £1 billion that will go in via the NHS will also be there to support social care, but it will particularly address issues such as reablement and preventive services.

[Liz Kendall (Leicester West) (Lab)]

The Government are abolishing all PCTs and handing £80 billion to GP consortiums that do not yet exist for services including the co-ordination of care. Is not this reorganisation a huge gamble for patients and taxpayers, which is why No. 10 and the Treasury are so concerned, as we see today in The Independent? Will the Minister finally agree to publish details about the financial assurance regime for GP consortiums, and will he guarantee that under his plans £80 billion of public money will be accountable to Parliament in the same way that it is today?

[Paul Burstow]

Of course the money will be accountable to Parliament, as it is now. The hon. Lady’s comments reflect an interesting campaign that the Labour party has dreamed up, which is very much to ally itself with the interests of primary care trusts rather than those of patients and ensuring that we improve public services. This Government’s proposals will improve the way in which services are commissioned, deliver better outcomes for patients up and down the country, and deliver the integration across health and social care that the previous Government failed to deliver.

[Henry Smith (Crawley) (Con)]

3. What recent progress he has made on the introduction of GP-led commissioning consortiums.

[Mark Lancaster (Milton Keynes North) (Con)]

13. What recent progress he has made on the introduction of GP-led commissioning consortiums.

[The Secretary of State for Health (Mr Andrew Lansley)]

On 21 October, I invited general practice-led commissioning consortiums to put themselves forward as pathfinders, and I have been absolutely delighted by the response. The pathfinder consortiums will be announced shortly. They have formed in response to the needs of local communities, and there is, sensibly, variation around the country to take account of those differing needs. Some consortiums map on to local authority boundaries; others organise themselves around catchments for hospitals or smaller populations. This bottom-up, locally determined approach is exactly in line with what we envisaged in the policy framework.

[Henry Smith]

Under the previous Government, Crawley hospital saw the removal of services such as accident and emergency and maternity. Can my right hon. Friend explain how, under the new GP-led consortiums, doctors will have the freedom and the flexibility to be able to refer their patients to local services if they so choose, as well as to new services?

[Mr Lansley]

That is exactly what our reforms will allow. We are putting not only the freedom to refer in the hands of general practices but choice in the hands of patients, and allying that to the power on the part of commissioners to commission services that meet the needs of their local community. That is precisely the change that will empower front-line clinicians and patients.

[Mark Lancaster]

Having consulted widely in Milton Keynes, I am pleased to say that the Government’s plans have been broadly welcomed. However, one area of concern that has been raised with me by patients, in particular, is the amount of time that they will get to spend face to face with their GP. Can the Secretary of State reassure my constituents and outline the administrative support that GPs will get in fulfilling their new functions?

[Mr Lansley]

I am grateful to my hon. Friend. In Milton Keynes, GP Healthcare MK and Premier MK consortiums are shaping their services in order to be able to deliver better and improved services for their patients. We do not intend that all GPs individually should become managers, by any means; there will be clinical leadership, but the consortiums should have commissioning support. The primary care trust in Milton Keynes has had some good commissioning support arrangements, as I know from having visited it in the past. It is open to the new commissioning consortiums to take teams from the primary care trust into their new consortium support arrangements, but they can go elsewhere. They can look to the local authority and to the independent sector to provide them with the commissioning support that they need so that clinicians provide leadership but continue to be responsible for clinical care.

[Mr Ben Bradshaw (Exeter) (Lab)]

What impact does the Secretary of State think that this change and the rest of the upheaval that he is inflicting on the health service will have on hospital waiting times?

[Mr Lansley]

I think that the reforms will have a positive impact on performance right across the NHS, because they will enable patients who want to exercise choice to see the quality and standard of services, including waiting times. Unlike in the past, they will be able to see waiting times for individual hospitals, rather than just a single target. They will be able to make choices based on information about the quality of services.

[Derek Twigg (Halton) (Lab)]

If the reforms are so good, why have they been criticised by the chairman of the Royal College of General Practitioners, Dr Clare Gerada? She said:

“I think it is the end of the NHS as we currently know it, which is a national, unified health service”.

The British Medical Association has expressed concerns about competition, and we hear in this morning’s edition of The Independent from an unnamed “ally” of the Secretary of State that

“There is no wobble. No 10 and the Treasury are fully behind the principle of the reforms”—

obviously a very brave ally. Why has the Prime Minister asked the Cabinet Office Minister who is in charge of Government policy to review the plans? Is it because the Secretary of State is the only one who believes in them?

[Mr Lansley]

The hon. Gentleman should not believe all that he reads in the newspapers. The curious thing is that the Minister with responsibility for Government policy is engaged with Government policy. That is a good and positive thing. The hon. Gentleman referred to the Royal College of General Practitioners and to Dr Gerada. In response to the White Paper, the RCGP said:

“General Practice is the central plank in our world-class healthcare system. The College thoroughly agrees that it makes a great deal of sense to give GPs, with their unique patient-centred perspective, a central role in commissioning and directing healthcare services.”

Dr Gerada said:

“I fully support placing clinicians at the centre of commissioning decisions”.

[Mr Stephen Dorrell (Charnwood) (Con)]

I very much welcome the steps that my right hon. Friend is taking to encourage the early emergence of pathfinder consortiums, so that the shape of the new commissioning structure is made clear as quickly as possible. Given the nature of the quality, innovation, productivity and prevention challenge—QIPP—that the health service faces, does he agree that the process must be carried forward as quickly as possible so that the new framework is clear for all concerned as quickly as possible?

[Mr Lansley]

Yes, I do. I was delighted by the response of general practice to the emerging consortiums, because one of the central reasons it wants to make progress quickly is to shape clinical service redesign, which is at the heart of delivering the efficiency savings that will enable us all to improve outcomes.

[David Miliband (South Shields) (Lab)]

The Secretary of State has said that GPs are the best people to manage the health service. Will he confirm that in the eight years of GP training, not a single hour is dedicated to the commissioning work that he has described?

[Mr Lansley]

The right hon. Gentleman should understand that what I said was that GPs are the best people to commission services. Commissioning and management are not the same thing. GPs are already responsible for commissioning most services in the NHS, but they have no power over resources and contracting. I intend to ally clinical leadership and commissioning decisions with commissioning support that involves management. The people who should determine the shape of local services to meet the needs of patients are those who are already at the heart of designing services and referring patients.

[Andrew Stephenson (Pendle) (Con)]

4. What recent representations he has received on management and administration costs in the NHS; and if he will make a statement.

[The Minister of State, Department of Health (Mr Simon Burns)]

Administration costs across the health sector will reduce by a third in real terms over the spending review period. That is a £1.4 billion cash reduction and a £1.9 billion real-terms reduction, from a baseline of £5.1 billion. Every penny of the savings will be reinvested in front-line services.

[Andrew Stephenson]

I thank my hon. Friend for that answer. Will he give me and my constituents examples of how the billions that are saved will make a difference on the front line when invested in patient care?

[Mr Burns]

I am extremely grateful to my hon. Friend and I will certainly give such examples. Every penny that is saved by cutting excessive management and bureaucracy will be spent on providing health care and drugs for his and other hon. Members’ constituents, and on ensuring that we have proper front-line services that provide the best quality care for all the people of England.

[Nick Smith (Blaenau Gwent) (Lab)]

Due to the snow, many falls and fractures have been reported in my constituency and around the country in the last few days. What plans are there to cope with such winter pressures?

[Mr Burns]

I fully appreciate the hon. Gentleman’s concern, because particularly at this time of the year and throughout the winter months there is both an extra duty on the NHS and an increased problem. I can assure him that for over a month now, as is the custom, the NHS has been meeting regularly to plan for the winter and ensure that we have the services in place to help those who suffer falls or illnesses due to the inclement weather.

[Simon Kirby (Brighton, Kemptown) (Con)]

5. On what date he expects to make an announcement on compensation for those infected by contaminated blood products supplied by the NHS.

[The Minister of State, Department of Health (Paul Burstow)]

In October we announced a review of a number of aspects of Lord Archer’s recommendations, including the level of ex gratia payments and the mechanism by which they are made, access to insurance, prescriptions charges and access to nursing and other care services. The Under-Secretary of State for Health, my hon. Friend the Member for Guildford (Anne Milton), expects to report the outcomes of the review by the end of the year.

[Simon Kirby]

I thank the Minister for his answer. Does he believe that, after all the years of inaction, that will draw a line under the matter?

[Paul Burstow]

The hon. Gentleman is absolutely right to indicate that the matter has not been dealt with thoroughly for many years, and that is why the Government have launched the review. Obviously I cannot pre-empt its outcomes, but we will bring it to the House as soon as we can.

[Ms Diane Abbott (Hackney North and Stoke Newington) (Lab)]

The Minister will be aware that no past Government have anything to be proud of in the way in which the matter was dealt with, and that Members on both sides of the House have campaigned on the issue. People hope that the Government will be able to live up to the promise in the October debate of producing a review before Christmas. Thousands of sufferers of HIV and hepatitis C, and thousands of dependants, are waiting for the announcement.

[Paul Burstow]

The hon. Lady makes some very important points. As she rightly says, the matter was debated in the House only recently, and the Government are determined to ensure that we are in a position to report back on the review before Christmas.

[Andrea Leadsom (South Northamptonshire) (Con)]

I know that the Under-Secretary of State for Health, my hon. Friend the Member for Guildford (Anne Milton), has done a lot of work on the review and is keen to see a fair settlement. May I urge Ministers to take into account the fact that this is perhaps one of the worst tragedies to have befallen the NHS in this country? Many people have suffered terribly, and I hope that Ministers will make every effort to ensure that those sufferers can at last receive closure.

[Paul Burstow]

I am grateful to the hon. Lady for her comments and will ensure that they are reported back to my hon. Friend the Under-Secretary for her consideration in the review.

[Paul Goggins (Wythenshawe and Sale East) (Lab)]

6. What steps he is taking to reduce energy consumption in hospitals.

[The Minister of State, Department of Health (Mr Simon Burns)]

The NHS continues to improve its energy efficiency. The Department provides guidance to the NHS and supports the NHS sustainable development unit, which promotes energy awareness and carbon management across health care providers. Hospitals are working with the Department for Business, Innovation and Skills to engage with suppliers who provide innovative solutions.

[Paul Goggins]

I thank the Minister for his answer and invite him to join me in congratulating all the staff at Wythenshawe hospital in my constituency, which was recently named overall winner this year in The Guardian public services award as the country’s greenest hospital and for reducing energy emissions by 26%. What further pressure is he putting on other hospitals and health service providers to ensure that they follow that fine example?

[Mr Burns]

I am happy to join the right hon. Gentleman in congratulating the university hospital of south Manchester on its fantastic achievement and the award that it has won. As he knows, his local hospital did that by reducing its energy consumption and carbon emissions by 26% over the past three years in ways such as the greater use of biomass fuels. It is a fantastic achievement and the staff should be justifiably proud of it. They are a beacon for other hospitals to follow to reach the same level of sustainability, and I am delighted that a number of hospitals throughout the country are striving to reach the position of the one in his area. I am confident that through greater sharing of information and work, more and more hospitals will make their contribution to reducing carbon levels.

[Miss Anne McIntosh (Thirsk and Malton) (Con)]

The Minister will be aware of the extreme weather conditions and extremely low temperatures of minus 17° C in and around Thirsk and in other parts of North Yorkshire where we have community hospitals and trust hospitals. Has he reviewed the impact on their funds of heating costs when low temperatures come so early in the winter and will carry on for such a long period?

[Mr Burns]

I can reassure my hon. Friend. She is absolutely right that the winter period and harsh weather impose extra costs, but I am pleased to tell her that partly through winter planning and partly through the experience of past years, hospitals are aware of that. They take into their planning and financial budgeting the possibility of weeks and perhaps longer—depending on the weather—when their costs will increase, and adjust to meet those demands. I am confident that bad weather will not impact on front-line services because of the work that hospitals do to account for it over the 52 weeks of the year.

[Annette Brooke (Mid Dorset and North Poole) (LD)]

7. What assessment he has made of the Health Protection Agency’s recent report on the incidence of tuberculosis.

[The Secretary of State for Health (Mr Andrew Lansley)]

I welcome the Health Protection Agency’s recent report on tuberculosis in the UK. There were 8,286 cases of TB in England in 2009, an increase of 4.3% on 2008. The rise has occurred mainly in people infected in countries where TB is common, who go on to develop active TB disease later in life.

[Annette Brooke]

I understand that that is a 30-year high. Evidence from New York shows that a co-ordinated approach across the city has made a real impact in controlling TB. How will the Secretary of State ensure that such co-ordination takes place, especially in cities, when GP-led commissioning is introduced?

[Mr Lansley]

The treatment services for individual patients will be commissioned through GP consortiums, but the identification and preventive work on TB is a public health responsibility. To that extent, I believe that we will be better placed to deal with it in future. Many local authorities—for example, in Birmingham, Manchester or Leeds—will be well placed as cities to respond to any incidence or outbreaks of TB on a preventive basis, using their powers as public health authorities.

[Ms Gisela Stuart (Birmingham, Edgbaston) (Lab)]

In response to my question on the publication of the White Paper about the more than 500 TB cases in Birmingham the Secretary of State confirmed that there would be no changes to what such cities could do to control TB outbreaks. Will he elaborate on his answer? What more can Birmingham do under the new arrangements to prevent such exceedingly high numbers?

[Mr Lansley]

We can do a number of things. For example, the Department has funded TB Alert, which is the UK’s national TB charity, to raise awareness of TB among public and primary health care professionals, which will help. In London, we have supported a find-and-treat outreach service. In a similar vein, that could happen in cities where there is a rising prevalence of TB. TB is not general across the country, but likely to occur in particular areas. Those kind of initiatives enable us to identify TB outbreaks, and we can then structure services around that.

[Penny Mordaunt (Portsmouth North) (Con)]

8. What assessment he has made of the merits of steps to increase the standard of end-of-life care in an acute setting; and if he will make a statement.

[The Minister of State, Department of Health (Paul Burstow)]

The Government are committed to increasing choice for people at the end of life, which will result in fewer people dying in hospital. However, there will always be a need for hospital-based end-of-life care. The national end-of-life care programme has published a guide for achieving quality in acute hospitals, which includes recommendations on holistic assessment, advance care planning, training, and improved multi-disciplinary working. The guide has been widely welcomed as a blueprint for improving the quality of end-of-life care.

[Penny Mordaunt]

Ministers will be aware of the Queen Alexandra hospital’s withdrawal of its G5 service to create a mobile model of end-of-life care. That will extend services across the hospital, but my constituents and I have grave concerns at the number of quiet and appropriate beds that will be left. Will Ministers agree to meet me to discuss what can be done to encourage the QA to meet the public’s concerns?

[Paul Burstow]

I am grateful to the hon. Lady for her question and I know that she has campaigned on that issue. She will know that on 25 October, the Secretary of State asked the independent reconfiguration panel to consider the issue that was raised by the Portsmouth health overview and scrutiny committee regarding a referral of ward G5. The advice has now been tendered, and the Secretary of State has asked the panel to undertake a full review of the case. He expects that report by March of next year and I am sure that during that period, conversations at ministerial level will be helpful.

[Emily Thornberry (Islington South and Finsbury) (Lab)]

Most people want to die at home, but they are prevented from doing so by the lack of out-of-hours support. Also, 24/7 community nursing is popular with the National Audit Office because it saves money. Even the Government say it is crucial, so why do they not use some of the £3 billion they are wasting on top-down reorganisation to ensure that everybody gets a community nurse at the end of their life, if they want one? How can the Government guarantee care for the dying if they abolish primary care trusts?

[Paul Burstow]

Perhaps a little humility might have been a necessary preface to that question, including, not least, an acknowledgment that the hon. Lady’s question is based on the failings of the previous Administration to deliver the necessary improvements in end-of-life care. On GP commissioning, there is undoubtedly an opportunity to integrate health and social care to deliver more timely and appropriate community-based end-of-life care, and we intend to deliver it.

[Jonathan Lord (Woking) (Con)]

9. What steps he is taking to improve the information provided to patients on their diagnosis and treatment.

[The Minister of State, Department of Health (Mr Simon Burns)]

As part of our White Paper reforms, a wide-ranging review of the information required to empower patients is in progress. Related current initiatives include the information standard scheme, information prescriptions and quality standards produced by the National Institute for Health and Clinical Excellence.

[Jonathan Lord]

I am grateful to the Minister for his reply. Currently good comparative data on the individual performance of doctors and surgeons are not readily available. How does he envisage compiling that data in a way that does not create too much bureaucracy or use up too much of doctors’ valuable clinical time?

[Mr Burns]

My hon. Friend is absolutely right: if we are to put patients at the heart of an NHS in which it is their care and views that are important and drive the provision of health care, we must empower them by giving them information that is consistently accurate, unbiased and easily understandable. We are currently consulting on our information revolution papers, and we await a chance to study the responses. However, we are determined to empower patients by giving them far more information, so that they can exercise their right of choice to get what they deserve, which is the very best health care.

[Keith Vaz (Leicester East) (Lab)]

I would like to declare an interest and remind the Minister that we currently spend £1 million an hour dealing with diabetes-related illnesses. One key way of helping to reduce that cost is giving patients diabetes tests and ensuring they get as much information as possible so that they can change their lifestyles.

[Mr Burns]

The right hon. Gentleman is absolutely right. We have to supply all patients, including those suffering from diabetes as well as other conditions, with as much information that they can understand as possible, so that they can make the choices about the health care they need. They also need to be backed up with advice from their GPs, community pharmacists and others in the health sector, because that will empower them to take decisions in their best interests to manage their medical condition.

[Mr John Baron (Basildon and Billericay) (Con)]

The Government have rightly announced, in the consultation document on patient choice, that all patients with long-term conditions will be offered a care plan. May I urge the Minister to ensure that that will apply also to cancer patients?

[Mr Burns]

As my hon. Friend is aware, we are still consulting on that document and will consider the results of the consultation process before making any final decisions. On his specific point, however, my understanding is that that will be case.

[Mr David Blunkett (Sheffield, Brightside and Hillsborough) (Lab)]

10. What decisions he has reached in respect of additional funding for the purpose of the tariff applying to specialist children’s hospitals.

[The Secretary of State for Health (Mr Andrew Lansley)]

Following a very constructive meeting with the specialist children’s hospitals on Friday 3 December, I am pleased to be able to tell the House that we are working on a proposal to set the top-up payment for specialised services for children at 60%, over and above tariff prices. In addition, I intend to help the trusts by extending the number of procedures that will attract the top-up payment in 2011-12. I believe that the children’s hospitals will find that entirely acceptable.

[Mr Blunkett]

I would like—uniquely—to thank the Secretary of State for signing off the technical agreement from last Friday, and to say that the specialist children’s hospitals will welcome his announcement this afternoon. Is it not time to take the uncertainty away from the children’s hospitals and have a system that allows them to put in place a forward plan that does not result in this annual farrago? Would it not also be nice to congratulate the staff of the children’s hospitals on their terrific work, not least the dedicated way in which they will be working with these children over Christmas?

[Mr Lansley]

Yes, I am very glad to do so. I have visited Sheffield children’s hospital, and I very much applaud the work that it does. I am sure that those at the hospital are grateful to the right hon. Gentleman, as I am, for the way in which he has represented their interests. I entirely agree with him: the purpose of developing the payment-by-results system is to arrive at a point where it is predictable and delivers a relevant payment, related to the costs that are genuinely incurred in the provision of that treatment. We are not in that position yet. The specialist top-up was put in place to reflect that, but I hope that it is temporary rather than permanent.

[Mr John Leech (Manchester, Withington) (LD)]

11. What progress has been made on improving the provision of specialist neuromuscular physiotherapy for people with muscular dystrophy and related neuromuscular conditions; and if he will make a statement.

[The Minister of State, Department of Health (Paul Burstow)]

Physiotherapy can help to manage the physical deterioration associated with muscular dystrophy and other neuromuscular conditions. Physiotherapists have a key role to play in reducing waiting times, improving access and choice, and providing more personalised services closer to home, thereby improving the quality of life of their patients. It is for local NHS organisations to decide how best to use the funds allocated to meet health needs.

[Mr Leech]

I thank my hon. Friend for his answer. Will he meet me and campaigners from the North West Muscle Group to discuss what actions need to be taken to ensure ongoing physiotherapy for patients with neuromuscular diseases?

[Paul Burstow]

I am grateful to my hon. Friend for that question, and I know that he plays an active part in the all-party muscular dystrophy group. He was involved in ensuring that we had a report from that body on access to specialist neuromuscular care—the Walton report, an important report that mapped out many of the deficiencies in the current service. I would be happy to meet him and his friends to discuss the matter further.

[Gareth Johnson (Dartford) (Con)]

14. What recent assessment he has made of the adequacy of provision of IVF treatment across the country.

[The Secretary of State for Health (Mr Andrew Lansley)]

Many primary care trusts have made good progress towards meeting NICE guidance recommendations on the provision of IVF treatment. However, I am aware that a small number of PCTs with historical funding problems have temporarily suspended local NHS provision of IVF services. I have already expressed my concerns about that approach. I expect all PCTs to have regard to the current NICE guidance and to recognise fully the significant distress and impact that infertility has on people’s lives.

[Gareth Johnson]

I am grateful to my right hon. Friend for his answer. He will be aware that Robert Edwards, the British inventor of IVF treatment, is due to receive the Nobel prize this week for his work. I am sure that Professor Edwards would be dismayed that PCTs have suspended their IVF provision, so would my right hon. Friend join me in urging those PCTs that have taken that step to reconsider their decision on this important issue?

[Mr Lansley]

Yes, I am indeed aware of that, not least because the Bourn Hall clinic, where Robert Edwards and Patrick Steptoe did their groundbreaking work, is in my constituency. As a former vice-chair of the all-party infertility group, I feel strongly that the reason the NICE guidance was written as it was, way back in 2004, was to recognise both the distress and the extent of the difficulties that couples face, and the need for them to be assured not only of good-quality investigation, but of good quality follow-up provision in fertility services throughout the NHS. I urge PCTs to have regard to the NICE guidance in their commissioning decisions.

[Mr Kevin Barron (Rother Valley) (Lab)]

If this unfair situation in the commissioning of infertility services continues, and if the reconfiguration goes ahead, would it be the responsibility of the national commissioning board to address it?

[Mr Lansley]

Beyond 2012 it would indeed. The reason we are in this position is not least because when NICE produced its guidance, my predecessor, John Reid, in effect told PCTs that they should not feel obliged to have regard to it and arbitrarily changed it. It is precisely that kind of political interference with what should be a clinically-led decision about the appropriate structure of commissioning services that I am proposing to do away with.

[Chris White (Warwick and Leamington) (Con)]

15. What support his Department plans to provide for front-line services in adult social care.

[The Minister of State, Department of Health (Paul Burstow)]

Protecting adult social care services is a clear priority for this Government. The spending review fully protects all existing grant funding for social care, and by 2014 an additional £2 billion a year will be available to support social care. Along with a programme of efficiency, those additional funds will enable councils to maintain access to social care while meeting demographic and other cost pressures and delivering new approaches to improve quality and outcomes over the next four years.

[Chris White]

I am grateful to the Minister for his response. In my constituency, residents of Whitnash are trying to set up a social enterprise to take over the running of a local care home. Will the Government encourage and support councils such as Warwickshire to respond positively to such initiatives, and will he meet residents of Whitnash so as to understand some of the issues that they face?

[Paul Burstow]

In our vision for adult social care, we very much argued the case for the greater use of social enterprises and the involvement of voluntary organisations as a way in which we can better deliver more personalised and appropriate public services of the very sort that the hon. Gentleman is talking about to our local communities.

[Ann Coffey (Stockport) (Lab)]

From April 2011, district nurses, health visitors and other specialist nurses working in the community in Stockport will be employed and managed by the Ashton, Leigh and Wigan Community Healthcare NHS Trust, and from April 2011, nurses providing community health services in Tameside will be employed and managed by the Stockport NHS Foundation Trust. Can the Minister tell me how that reorganisation will improve the delivery of front-line services to local people?

[Paul Burstow]

First and foremost, the hon. Lady should welcome the fact that this will provide opportunities for the greater integration of services, and that is a key way in which we can deliver better outcomes for her constituents and others up and down the country.

[Paul Maynard (Blackpool North and Cleveleys) (Con)]

16. How many patients in psychiatric care died of natural causes in the last five years.

[The Minister of State, Department of Health (Paul Burstow)]

Information on the number of people in psychiatric care who died of natural causes is not available. However, information about patients detained under the Mental Health Act is collected by the Care Quality Commission. The most recent information, covering the period 2005 to 2008, shows that there were 1,392 deaths of detained patients, of which 1,123 were ascribed to natural causes.

[Paul Maynard]

I thank the Minister for that reply. Does he share my concern that, almost uniquely in psychiatric care the state has a large degree of control over an individual’s circumstances, yet, unlike in prison or police custody, deaths from natural causes do not have to be reported to the coroner or be the subject of an inquest? Does he not think that the time has now come to end that disparity and to shed some light on to the real reasons behind many of the deaths from natural causes in psychiatric care?

[Paul Burstow]

My hon. Friend might be interested to know that the Ministry of Justice is reviewing sections of the Coroners and Justice Act 2009 and how they will be implemented. That review will include the subject of how deaths are reported to coroners. In fact, the statutory requirements to report deaths of mental health patients to coroners are the same as those for other patients, and NHS providers must report deaths of service users that occur during, or as a result of, care or treatment that they are providing.

[Richard Graham (Gloucester) (Con)]

17. What recent representations he has received on the management and administration costs of the NHS; and if he will make a statement.

[The Minister of State, Department of Health (Mr Simon Burns)]

As I said to my hon. Friend the Member for Pendle (Andrew Stephenson) earlier, administration costs across the whole health sector will reduce by a third in real terms over the spending review period. This is a £1.4 billion cash reduction and a £1.9 billion real-terms reduction, from a baseline of £5.1 billion. Every penny of the savings will be reinvested in front-line services.

[Richard Graham]

I am grateful to the Minister for his reply. Can he reassure my constituents in Gloucester that this is broadly the degree of savings that we should expect from NHS Gloucestershire’s expenditure on management, and that those savings will be spent on the rising demand for front-line services, including in the new, soon-to-be-opened women’s centre?

[Mr Burns]

Yes, I can give my hon. Friend the assurance that he seeks. We have made it quite clear that we will reduce management costs throughout the NHS by more than 45% over the next four years, and establishing GP consortiums will allow us to strip out the costly top-down bureaucracy that now exists. All the money that will be saved through these initiatives will be reinvested in front-line services, which will benefit the constituents of my hon. Friend and those of every other right hon. and hon. Member throughout England.

[Rushanara Ali (Bethnal Green and Bow) (Lab)]

I am concerned about the quality of services that patients and their families receive. In my constituency, 100 jobs are already going, and I am worried that the cuts in staffing will have an effect on the services that are available. Can the Minister guarantee that front-line services will be protected, because the reality is that, in constituencies such as mine, staffing is crucial to ensuring that decent services are available?

[Mr Burns]

I have to tell the hon. Lady that, in this very difficult financial situation, which we inherited from her Government, it is only by making efficiency savings and getting rid of excess bureaucracy that we can generate the income to reinvest to save front-line services—[Interruption.] She and the Greek chorus in front of her must understand that, if we had not been left in this mess in which £43 billion a year is being spent on the interest on the debt that we inherited, we would not have the problems that we now have—

[Mr Speaker]

Order. I think we understand what the Minister is trying to get at.

[Mr Graham Stuart (Beverley and Holderness) (Con)]

I welcome the Minister’s responses and his firm proposals to reduce administration costs. However, it is not just a matter of management costs rising massively under the last Government, as productivity fell. The last time productivity increased in the NHS was under the last Conservative Government in the early 1990s. What plans do the Government have to ensure that productivity is increased, because only by doing can we deliver better health?

[Mr Speaker]

Let us have the answer.

[Mr Burns]

My hon. Friend is absolutely right. Although the last Government significantly increased health spending —I do not dispute that; it is a self-evident fact—the trouble is that we did not see increases in productivity pro rata. That is the challenge that we face; that is what we are addressing; that is what we are going to achieve through QIPP—quality, innovation, productivity and prevention—by cutting out inefficiency, cutting out excess management and administration so that every single penny can be reinvested in improving front-line services and giving our constituents the finest health they—

[Mr Speaker]

Order. The Minister will resume his seat. His answers have been excessively long-winded and repetitive—and it must not happen again. I have made the position clear and I hope that the Minister will learn from that.

[Mr Russell Brown (Dumfries and Galloway) (Lab)]

18. What estimate he has made of the change in average waiting times for patients waiting for diagnostic tests since May 2010.

[The Minister of State, Department of Health (Mr Simon Burns)]

Patients are continuing to receive timely access to diagnostic tests. In September 2010, the median waiting time for 15 key diagnostic tests was 1.7 weeks, compared with 1.8 weeks in May.

[Mr Brown]

I thank the Minister. Does he expect waiting times to stay down now that they have been scrapped or will they simply be ignored by no longer being performance-managed?

[Mr Burns]

I suggest that the hon. Gentleman studies the response given earlier by my right hon. Friend the Secretary of State to the right hon. Member for Exeter (Mr Bradshaw). By concentrating resources and reforming the system to improve outcomes, we will provide enhanced health care for all our constituents in England.

[Jonathan Reynolds (Stalybridge and Hyde) (Lab/Co-op)]

T1. If he will make a statement on his departmental responsibilities.

[The Secretary of State for Health (Mr Andrew Lansley)]

My responsibility is to lead the NHS in delivering improved health outcomes in England, to lead a public health service that improves the health of the nation and reduces health inequalities and to lead the reform of adult social care, which supports and protects vulnerable people.

[Jonathan Reynolds]

The Secretary of State will be aware that primary care trusts across the country are being asked to cut between 35% and 50% from their management costs. This inevitably leads to job losses, but can he confirm that he is confident that the jobs being lost as a result of this policy are purely management roles and that there are no losses of jobs that combine some management role with front-line clinical responsibilities?

[Mr Lansley]

We have been very clear that we are asking the whole of the NHS administration—we are applying the same discipline inside the Department, to arm’s length bodies and across the whole of government—to secure a reduction by a third of real-terms administration costs over four years. In the NHS in particular, I am looking for a reduction in management costs of 45% in cash terms. By that, I mean specifically the costs of managers and senior managers. By definition, that does not include clinical staffing.

[Ian Swales (Redcar) (LD)]

T3. In the light of the recent damning report by the Care Quality Commission into Redcar and Cleveland council’s adult social care services, what steps is the Secretary of State taking to improve adult social care and will he meet me to address the issues raised in the report?

[The Minister of State, Department of Health (Paul Burstow)]

I am grateful to my hon. Friend for his question. I know of his concerns, which he has raised for some time. I understand that an improvement plan has been developed by Redcar and Cleveland and that it has been shared and agreed with the Care Quality Commission. The plan has a strong focus around ensuring a rigorous approach to improving the safeguarding of vulnerable people, and a peer review process is being established with the Local Government Group and the Association of Directors of Adult Social Services. I would, of course, be happy to meet my hon. Friend to discuss the matter further.

[John Healey (Wentworth and Dearne) (Lab)]

May I welcome the Secretary of State’s sensible rethink and change of mind on the funding of specialist children’s hospitals after Labour Members raised concerns during the previous Health questions? During those questions he also got his NHS funding figures in a twist, so what has he got to say about the updated inflation forecasts on page 83 of last week’s Office for Budget Responsibility report? They show that for the next four years the inflation increase will be bigger than the cash increase in the NHS—in other words, the NHS will get a real cut in funding, not a real increase. Does he accept the OBR figures? Does he accept that they are hard proof that the Government are breaking their promise to protect NHS funding?

[Mr Lansley]

Let me tell the right hon. Gentleman that it is not a change on specialist children’s hospitals. The previous Government initiated a study by York university, which reported. I made it clear, when we discussed it last, that we were examining the results of that together with the specialist children’s hospitals. We have reached what I regard, as I hope they do, as a very acceptable outcome.

The spending review gave a real-terms increase in NHS funding. That was the commitment we gave and it was set out in the spending review, and it remains true that revenue funding for the NHS continues to rise in real terms.

[John Healey]

Perhaps I should have asked the Secretary of State whether he has even seen the OBR report. Let me try to help him. The OBR’s inflation figures mean that the NHS will not get the 0.4% real increase that he bragged about and that was stated in the spending review; the NHS will get a 0.25% decrease—a cut—in funding, as has been confirmed today for me by the House of Commons Library. No wonder the Prime Minister is rattled and is asking what on earth the Health Secretary is doing with the NHS. Does the Health Secretary accept that this confirms that the coalition’s pledge to guarantee that health spending rises

“in real terms in each year of the Parliament”

is being broken? How does he explain that to the Prime Minister and how does he explain it to the public?

[Mr Lansley]

No, I do not accept that for a minute. At the spending review we set out what met our commitment. I am very clear that, as I just told the right hon. Gentleman, revenue funding for the NHS will increase in real terms. It will do so because we did not listen to the advice of the Labour party in the run-up to the spending review, which was to cut the NHS budget. We did not do that and we were committed at the spending review to an increase in real terms. The gross domestic product deflator will move from time to time, but the commitment that we set out was clear and will continue.

[Mr Speaker]

Just as the answers from the Minister of State, the hon. Member for West Chelmsford, were too long, those questions were too long as well.

[Mr Burns]

Chelmsford.

[Mr Speaker]

Order. I do not require any assistance from the hon. Gentleman. We must speed up from now on. That is the situation.

[Michael Ellis (Northampton North) (Con)]

T6. Every day, ambulance service staff in my constituency and around the country deliver life-saving care to our constituents, but they are themselves occasionally put in harm’s way. What steps are Her Majesty’s Government taking to ensure that the protection that our ambulance staff get in my constituency and around the country is the best that we can provide?

[Mr Lansley]

I join my hon. Friend in paying tribute to the staff in ambulance service—in the current circumstances, with the winter pressures being what they are, we should especially do so. But those staff can come under particular threat from time to time and we have to prepare for all eventualities. For example, if an attack involving firearms takes place, as it did recently in Cumbria, it is possible that ambulance staff would be working alongside other emergency services in responding to it. It is only right, therefore, that they are offered as much training and equipment as possible to carry out that work.

[Paul Goggins (Wythenshawe and Sale East) (Lab)]

T2. This morning, the Justice Secretary said that he was working with the Health Secretary on plans to divert more mentally ill offenders away from prison. I broadly welcome that, but could the Health Secretary tell us how much new money will be made available for that initiative, especially given the comments made by my right hon. Friend the Member for Wentworth and Dearne (John Healey) about the cut in the real value of health spending?

[Mr Lansley]

The right hon. Gentleman is in no position to make that point, given that his party wanted to cut the NHS budget. What my right hon. and learned Friend said this morning about our working together is indeed true. However, this is not a case of our diverting patients; it is about ensuring that people who have mental health problems are dealt with appropriately rather than there being a failure to deal with them. That applies whether they are in prison or in hospital. We are working together on that, and I know that my right hon. and learned Friend will be making a statement shortly.

[Richard Graham (Gloucester) (Con)]

T8. Can Ministers reassure me that, given the relative health deprivation in Gloucester, the ring-fenced funding promised in the White Paper on public health will in fact benefit people there?

[Mr Burns]

Yes, I can certainly give my hon. Friend that assurance. The money will be ring-fenced to ensure that local communities can enhance the quality of public health for all constituents both in Gloucestershire and throughout the country.

[Mrs Mary Glindon (North Tyneside) (Lab)]

T4. The north of England cancer network has been working since 2007 to improve cancer commissioning across primary and secondary care and to improve standards of cancer care for my constituents. Can the Secretary of State confirm that it will continue to play that role after the introduction of GP commissioning?

[Paul Burstow]

In the not-too-distant future, we will publish the refresh of the cancer reform strategy. That will demonstrate how the Government will continue to build on past success while ensuring that we reduce and improve the survival rates for cancer. One of the real problems in this country is that we have some of the poorest survival rates for cancer. We will ensure that the networks’ expertise is incorporated into the way in which the reformed system will work.

[David Tredinnick (Bosworth) (Con)]

Is my right hon. Friend aware of the rally being held here in Westminster tomorrow by qualified herbalists who are coming to lobby for statutory regulation, which my right hon. Friend is obliged to provide under European law? When will he do that, please?

[Mr Lansley]

I am indeed aware of that, as my hon. Friend would expect. He will know that we are considering how we can give effect to the proper regulation of herbal practitioners and we will make an announcement shortly.

[John Mann (Bassetlaw) (Lab)]

T5. If a hospital service’s reconfiguration is demonstrably and overwhelmingly rejected by a local population, what notice will the Secretary of State take of the patients’ voice?

[Mr Lansley]

It was only under this Government, after the election, that tests were set out that such reconfigurations should meet. Those tests clearly included recognition of the voice of the public and of the local authority as well as current and prospective patient choice. To that extent, for the very first time, reconfigurations are not being dictated by an NHS administration but are responding to the views of patients and clinicians.

[Duncan Hames (Chippenham) (LD)]

The NHS Litigation Authority estimates an outstanding liability for clinical negligence claims of £15 billion, a sum that increased by £2 billion in the last year alone. How will the Minister bring that spiralling cost to the NHS to a halt?

[Mr Lansley]

I understand exactly my hon. Friend’s point. The increase in liabilities was, in part, an expression of the change in the discount rate rather than necessarily an increase in the number of cases coming through. It is a worrying figure and costs the NHS not far short of £1 billion a year through contributions to the clinical negligence scheme for trusts. My noble Friend Lord Young, in the course of his review of health and safety and other issues, made recommendations on dealing with conditional fee arrangements and clinical negligence. It set out that we would consider, for example, how we implement NHS redress arrangements, including whether there should be a fact-finding phase before any question of legal intervention. We will do that and report back to the House.

[Pat Glass (North West Durham) (Lab)]

T7. My local hospital, Shotley Bridge hospital in Consett, has faced a degree of certainty over its future in recent years. However, with the demise of the local PCT, which owns the hospital and the land, uncertainty has returned. Is the Minister prepared to meet me and a delegation from the hospital to consider the future?

[Mr Lansley]

I am sure that I or one of my hon. Friends will be happy to meet the hon. Lady. I do not know why she thinks that the abolition of the PCT will make that change. We have yet to set out how PCT assets will be dealt with when they are abolished. She must talk to her local GPs as I know that GPs in Durham have come together in a consortium and they will be well placed to give precisely the kind of assurance about the security of services in the future that she is looking for.

[Nick de Bois (Enfield North) (Con)]

The Secretary of State will be aware that the Barnet, Enfield and Haringey clinical review has been concluded. It notes that the Secretary of State’s four tests have been passed, despite health scrutiny establishing that they have not. In addition, the majority of Enfield GPs do not support the proposals. Will the Secretary of State therefore conclude that the four tests have not been passed?

[Mr Lansley]

My hon. Friend will know that all that has not yet come to me, so I will not prejudge this issue. However, I have made it clear, not least in a letter I recently sent to Baroness Margaret Wall, who is the chair of the Barnet and Chase Farm Hospitals NHS Trust, that I expect us to examine not only the Barnet, Enfield and Haringey proposals, but any other proposals that the trust might put forward about the level of acute services provided through Chase Farm.

[Toby Perkins (Chesterfield) (Lab)]

T9. The Secretary of State seemed to suggest, in his answer to the shadow Secretary of State, that his definition of a real-terms increase includes changes in inflation. If he does not accept the Office for Budget Responsibility verdict that the increase in inflation means a real-terms cut in 2012, which definition of inflation is he using?

[Mr Lansley]

What I said to the shadow Secretary of State was entirely accurate.

[Gordon Birtwistle (Burnley) (LD)]

Does the Secretary of State agree that the abolition of unelected quangos such as primary care trusts and strategic health authorities will bring an end to the decisions they are taking to remove services from local hospitals against the wishes of GPs and local residents?

[Mr Lansley]

The reforms we propose will bring far greater accountability not only through local authorities but through patient choice and through front-line clinicians being able to commission services.

Let me also tell my hon. Friend that I have today referred to the independent reconfiguration panel, for initial appraisal, the question referred to me by Lancashire county council about the children’s ward at Burnley hospital.

[Steve McCabe (Birmingham, Selly Oak) (Lab)]

Will the Secretary of State join me in deprecating the outrageous behaviour of the Prime Minister’s aides who told the Financial Times that the Secretary of State, on his reorganisation, has all the answers—unfortunately to all the wrong questions?

[Mr Lansley]

The hon. Gentleman should not believe what he reads in the papers and when he is trying to quote from them, he should do so accurately.

[Caroline Dinenage (Gosport) (Con)]

Blake maternity unit in Gosport is temporarily shut and its long-term future is by no means 100% secure. In conversations with local health care bosses, I have learned that it is not because of cost but because of a national shortage of midwives. Are there any policies or plans to address this issue?

[Mr Lansley]

I do not know the particular circumstances in Gosport, but I shall happily write to my hon. Friend. Nationally, we have more midwives than we have ever had—[Interruption.] I am being provoked by those on the Opposition Front Bench. There was a 16% increase in the number of live births in this country, but only a 4.5% increase in the number of midwives. That is the point I was about to make. The Government of whom the hon. Member for Halton (Derek Twigg) was a member failed to invest in midwifery when there was an increase in live births. That is why hospitals across the country have too few midwives, and that is why we are putting the investment in—because we did not listen to the Labour party when it said, “Cut the NHS budget.”

[Fiona Mactaggart (Slough) (Lab)]

Will waiting times for in-patient treatment in hospital increase or decrease next year?

[Mr Lansley]

They will respond positively to patient choice and GP referral.

[Joseph Johnson (Orpington) (Con)]

I am grateful to the Secretary of State for agreeing to visit Queen Mary’s, Sidcup, tomorrow, recognising the strength of local opinion there about the closure of accident and emergency and maternity services temporarily over the winter period. I hope that on his return he will reassure my constituents in Orpington that the closure will not mean that the review of reconfiguration of local NHS services will be prejudged and will not put neighbouring hospitals such as those in my constituency under undue pressure.

[Mr Lansley]

I am grateful. Tomorrow, I hope to assure myself, among other things, that the closure is temporarily demanded by virtue of the inability to secure enough staff to maintain a safe service for the time being and that it will not and does not pre-empt the question of availability of services at Queen Mary’s, Sidcup, on which a decision has not yet been reached locally or referred to me.

[Mr Dennis Skinner (Bolsover) (Lab)]

On the NHS campaign against obesity, does the Secretary of State welcome the magnificent support of the thousands of schoolchildren who have come down to demonstrate for school sports funding outside No. 10 Downing street? Will he fight in the Cabinet against the Education Secretary’s silly proposal, which will damage children’s health?

[Mr Lansley]

The Secretary of State for Education rightly believes in schools making decisions about how they should best use their resources, including for school sport. I hope the hon. Gentleman will welcome the fact that through my Department we have supported school sports clubs under Change4Life and intend to expand them.

Rehabilitation and Sentencing

Tuesday 7th December 2010 Commons Chamber

15:34

[The Lord Chancellor and Secretary of State for Justice (Mr Kenneth Clarke)]

With permission, Mr Speaker, I would like to make a statement. On 12 May, we said in our programme for government that we would conduct a full assessment of rehabilitation and sentencing policy to pave the way for radical reforms to the criminal justice system. I have laid before Parliament today the Green Paper entitled “Breaking the Cycle: Effective Punishment, Rehabilitation and Sentencing of Offenders.” This sets out our initial conclusions from this work, on which we will be consulting widely over the next 12 weeks.

Despite record spending we are not delivering what really matters. Society has a right to expect the criminal justice system to protect them. Prison will always be the right place for serious and dangerous offenders. Criminals should be properly punished. Prisons should be places of hard work and industry, and community sentences must be credible and robust. Criminals must also be reformed so that when they finish their sentence they do not simply return to their life of crime, creating more misery for victims.

The present criminal justice system falls short of what is required. Around half of offenders released from prison reoffend within a year. Reoffending rates for young offenders sentenced to custodial or community sentences are even worse. It is not acceptable that three quarters of offenders sentenced to youth custody reoffend within a year. If we do not stop offending by young people, the young offenders of today will become the prolific career criminals of tomorrow.

Solving these problems requires a radically different approach. Of course, criminals must face robust and demanding punishments. This means making them work hard both in prison and in the community. More prisoners will face the tough discipline of regular working hours. This has been lacking in most prison regimes for too long. Community sentences will be more credible, with more demanding work and greater use of tough curfew requirements. There will be greater reparation to victims through increased use of restorative justice and by implementing the Prisoners’ Earnings Act 1996. We will bring forward other changes to make sure that more offenders directly compensate the victims of crime.

But we will take a new approach to the reform of offenders. I regard prison first and foremost as a place of punishment where people lose their liberty as reparation for what they have done, but on top of that, prison cannot continue to be simply an expensive way of giving communities a break. We must give higher priority to ensuring that more prisoners go straight on release.

Offenders will face a tough and co-ordinated response from the police, probation and other services. It will mean that they must either address the problems that fuel their criminal activity or be caught and punished again. It will mean taking action to get offenders off drugs. It will mean reducing the abuse of alcohol. It will mean improving the treatment available to those suffering mental illness. It will mean getting more of them off benefits and into honest employment so that they can pay their own way.

We will bring forward a revolutionary shift in the way that rehabilitation is financed and delivered. We will begin by commissioning a range of providers to administer at least six new projects over the next two years. They will be paid for the results that they achieve. I intend to apply the principles of that approach across the whole system by the end of the Parliament. We will also test this payment-by-results approach with young offenders, and devolve more responsibility for preventing and tackling youth offending to local communities. We will introduce more competition across offender management services to drive up standards and deliver value for money for the taxpayer. We will increase discretion for public sector providers and front-line professionals.

The sentencing framework must provide courts with a range of options to punish and rehabilitate criminals and keep the public safe. The sentencing framework has developed in an ad hoc fashion recently, with over 20 Acts of Parliament changing sentencing in the past 10 years. This has left it overly complex, difficult to interpret and administer, and hard for the public to understand. We need to make better use of prison and community sentences to punish offenders and improve public safety, while ensuring that sentencing supports our aims of improved rehabilitation and increased reparation to victims and society. We will therefore simplify the sentencing framework in order to make it more comprehensible to the public and to enhance judicial independence. We will reform community orders to give providers more discretion, and we will encourage greater use of financial penalties and improve their collection.

We will bring forward reforms to the indeterminate sentence of imprisonment for public protection. This sentence has been much more widely used than was ever intended by Parliament since its introduction in the Criminal Justice Act 2003. Indeed the last Government had already tried to change it once since its introduction. We will reserve IPP sentences for the most serious offenders and focus indefinite punishment on those who most clearly pose a very serious risk of future harm. Of course, prisoners who in future do not receive an IPP sentence will instead receive long determinate sentences. This will enable us to restore clarity in sentencing, plan rehabilitation and target punishment more effectively to protect the public.

Let me assure the House that public safety remains our first priority. We will continue to ensure that serious and dangerous offenders are managed effectively and their risk is reduced through appropriate use of prison and then through the multi-agency public protection arrangements. Let me also assure the House that we will also ensure effective responses to knife crime. Knife crime is wholly unacceptable. It causes misery for victims and is often connected to the kind of gang violence that can wreck whole communities. The Government’s position is clear. Any adult who commits a crime using a knife can expect to be sent to prison, and serious offenders can expect a long sentence. For juveniles, imprisonment is always available and will also be appropriate for serious offenders.

The Green Paper is an important change of direction in penal policy, which will put more emphasis on reducing reoffending without reducing the punishment of offenders. By reforming criminals and turning them away from a life of crime we will break the cycle. This should mean fewer crimes, fewer victims and safer communities. The Government will make a further statement to the House when they publish their response to the consultation. I commend the statement to the House.

[Sadiq Khan (Tooting) (Lab)]

I thank the Secretary of State for advance sight of his statement on sentencing policy. The Ministry of Justice’s four-year plan on its vision page declares:

“We will provide a clear sentencing framework. It will punish those who break the law, and help reduce re-offending.”

I have no quarrel with that. It seems to me a perfectly sensible vision for a sentencing policy, entirely in keeping with the emphasis on punishment and reform that Labour followed in government, and which helped to cut crime by 43% between 1997 and 2010, both in times of growth and recession—the only Administration since the second world war who can boast such an enviable record.

I have a number of questions for the Secretary of State. First, will he confirm that he accepts that crime went down, as I have just said? So, on the core principle we are in agreement, and where the Government propose sensible measures to punish and reform offenders, we will support them. However, the statement that we have just heard and the Green Paper give rise to a number of questions and concerns. Will he confirm that the entirety of the Conservative party’s manifesto on law and order has been put in the bin? Before the election, the Prime Minister promised that there would be tougher sentences for knife crime. People caught in possession of a knife would face a presumption of prison. Does the Secretary of State accept that he has now made a humiliating U-turn on that policy? The Prime Minister promised that there would be “honesty in sentencing”. Judges would read out a maximum and a minimum sentence to offenders in court. Does the Secretary of State accept that there has been a U-turn on that also? The Prime Minister promised increased prison capacity—another U-turn?

Let us be absolutely clear. Every one of those pre-election promises to be tough on crime has been abandoned. They have been revealed for what they are: a bluff. A bluff on crime and a bluff on the causes of crime. Like so many of the heavily trailed announcements that we have seen in the past six months, this sentencing review is a wasted opportunity. Sentencing policy should be about dealing with offenders in the right way in order to protect the public, but this review has been about trying to reduce the prison population in order to cut costs.

When the comprehensive spending review was published recently, the Justice Secretary outlined his central aim, which was

“to reduce the total daily prison population by 3,000 by 2014.”

The prison population is about 85,000 today, so that would mean it being 82,000 in four years. In practice, however, because many people serve less than one year in prison, meeting that target would mean 10,000 fewer offenders in jail each year. That is what the sentencing review is all about.

Given the Government’s big claims about transparency, can the Secretary of State confirm that he will publish the detailed assumptions that his officials and the Home Office have made about crime trends to justify that target of 82,000? I do not subscribe to the view that there is a direct link between prisons and crime, but nor do I share the Justice Secretary’s belief that there is no link at all. Under Labour, more serious and persistent criminals went to prison for longer, and crime fell. The relationship between those two things might not have been simple and straightforward, and other factors, including an increase in police numbers, were at play, but there was a relationship.

The Justice Secretary, to justify his view that there is no link, is fond of saying that crime rates also declined internationally during that time, but that prison rates in many countries went down. Well, he is wrong. I have checked the figures for OECD countries, and prison populations rose almost everywhere. Although prison should always be the outcome for serious and persistent offenders, we believe that alternatives to custody should be used when they are a more appropriate form of punishment and reform. We accept that prison is not always the best place for offenders, and community sentences can be a better alternative in order to cut reoffending, but does he accept that, as a result of the changes that we introduced, the number of women in custody went down, and that reoffending rates for women, young men and first-time offenders also went down in recent years?

I welcome the announcement that the Government are seeking to build on important Labour innovations, such as the expansion of community payback. Further action on drug addiction is clearly welcome, and the steps outlined to deal more effectively with offenders with mental health problems, one of our society’s most pressing issues, are a vindication of the decision of my right hon. Friend the Member for Blackburn (Mr Straw) to set up and start to implement the important Bradley review.

The current Justice Secretary aims at some of the right goals, but his total eagerness to please the Treasury by cutting the Ministry of Justice budget by 23% will make it very difficult and risky to turn those aspirations into reality. With the Home Secretary having also caved in to a 23% cut, the obvious question voters will ask is, how can the right hon. and learned Gentleman’s party ever again claim to be the party of law and order?

The Secretary of State will recall the old care in the community model for mental health in the 1990s. As a former Health Secretary, he presided over it and will be aware of some of the real problems that it created. If proper resources are not invested in dealing with offenders outside prison, we could be in for care in the community mark II—this time with criminals.

Will the Justice Secretary explain, in particular, what assessments are being made of the likelihood that prisoners on indeterminate sentences, whom he wants to release, are no longer a risk to the public? What procedures will be put in place to monitor such people in the community?

[Mr Speaker]

Order. I am loth to interrupt the shadow Secretary of State, but he is getting towards the point where his questioning has been longer than the Secretary of State’s pithy statement, so he really does now need to bring it to an end. He can have another sentence, but he must then bring it to an end.

[Sadiq Khan]

As ever, Mr Speaker, I am grateful.

When the Justice Secretary was recently asked on BBC’s “Newsnight” how he would judge the success of his penal policy, his first response was that he “hadn’t the first idea”. That was a more revealing answer than he perhaps intended, because it exposed a certain complacency that is becoming the hallmark of this Government.

In conclusion, let me offer the Lord Chancellor advice on how to judge the success of his policy. Will it make communities up and down the country more or less safe? Will it result in crime going up or down? I tell the Lord Chancellor and those who support him that it is against those criteria that we will be holding him, his proposals and his Government to account.

[Several hon. Members]

rose—

[Mr Speaker]

I do not want to be corny about it, but in this context I should surely be able to appeal from now on for shorter sentences—and preferably fewer of them.

[Mr Clarke]

I was about to congratulate the Opposition spokesman on his statesman-like performance in a difficult situation. He managed to go on for exactly the same length of time as I took to make my statement. I listened carefully, and he did not criticise a single proposal that I had made. He did not disagree at all. I should have realised that he would do that, because when he was asked, by Decca Aitkenhead in The Guardian of 29 November, whether Ken Clarke had said anything that he disagreed with, he said, “No, he hasn’t.” He took eight minutes to give that reply today, but the conclusion was the same.

The right hon. Gentleman said that we had abandoned our whole manifesto and pre-election commitment. We are in a coalition Government and have inherited a financial crisis. The principal argument that we had when in opposition was about the rehabilitation revolution. I commend to the right hon. Gentleman the work done by my right hon. Friend the Minister for Policing and Criminal Justice and my hon. and learned Friend the Solicitor-General on a pamphlet called “Prisons with a purpose”. In the manifesto, we said:

“We will never bring our crime rate down or start to reduce the costs of crime until we properly rehabilitate ex-prisoners.”

That remains the core proposal that we are putting forward, and I am glad to be able to build on it.

The right hon. Gentleman talks about the reduction in the number of people in prison. Eighty-two thousand is not a target; I asked people to produce an estimate of what the whole package—there are a lot of things in the package—was likely to do to the prison population over the next few years, and their estimate, and it is only an estimate, is that that population will reduce by about 3,000. It would be quite something to stop the explosion of the prison population that has been going on in recent years. Reducing it by 3,000 is quite modest, but that is an estimate. We are aiming to do something to ease the pressure on the system—above all, to ease the pressure on victims—by rehabilitation and by tackling the root causes of crime.

The right hon. Gentleman talks about numbers. He tried to praise—he did his best—the record of the Government of whom he was a member. The real nadir of the publicity-seeking policies of the last Government came when they had succeeded in getting so many people sentenced to prison that they could not accommodate them. Eventually, they had to release 80,000 prisoners from jail, before they had finished their sentences, under an early-release scheme. That was a debacle of a policy that we will not repeat.

The right hon. Gentleman talked about this being against a background of a 23% reduction in my budget. Half of that, of course, is going to come from administration and a great bulk of it from legal aid savings, which he supports. Much less will come from the Prison Service and the probation service.

Does that comment mean that the right hon. Gentleman would spend more? I am waiting to hear what the Labour party says about the financial background to policy. Apparently, the reduction is too much. Will he consult the shadow Chancellor and let us know how much more a new Labour Government would spend on keeping up the prison population, keeping the criminal justice system as it is and continuing the failed policies of the last Government?

[Several hon. Members]

rose—

[Mr Speaker]

Order. Thirty-seven years of service in the House should make the right hon. Member for Berwick-upon-Tweed (Sir Alan Beith) an exemplar of brevity.

[Sir Alan Beith (Berwick-upon-Tweed) (LD)]

I remind the Lord Chancellor that Members from all three parties on the Justice Committee unanimously recommended a shift from expanding prison places to rehabilitation, drug and alcohol treatment, mental health provision and early intervention to stop young people from getting into crime. Would he not be failing to keep the public safe if he did not follow that recommendation?

[Mr Clarke]

I entirely agree with the right hon. Gentleman. A lot of people in all three parties welcome this shift of policy; it is not particularly me and my colleagues who believe it; It is quite obvious that it is a direction in which we should go. I look forward to having the assistance of the Select Committee and making sure that we get the details right and keep going in the right direction.

[Several hon. Members]

rose—

[Mr Speaker]

Order. I would love to try to get everyone in, but I appeal to right hon. and hon. Members to help me to help them.

[Mr Jack Straw (Blackburn) (Lab)]

Why is the Secretary of State so unwilling even to utter the words that would acknowledge that, in the past 15 years—the last two years of his Government, from 1995, and through the 13 years of the previous Labour Government—crime fell by a record 50%? Why does he not acknowledge that and also accept that the cost-cutting led programme that he has announced today may put crime levels at risk?

[Mr Clarke]

Of course I acknowledge that crime fell during that period, as it did throughout most of the western world. I have always acknowledged that. Where we will not agree is on the simple cause and effect that the right hon. Gentleman puts forward. Let me quote from a source whom it would be unexpected for me to quote with total favour: Mr Newt Gingrich. A recent article he published in an American magazine about the situation in the state of South Carolina states:

“Often, in…fiscal crises, we hear that no area of state spending is exempt from budgetary review. But in reality, prison spending often is the proverbial sacred cow. That’s partly because voters…mistakenly believe reductions in the prison budget will lead to putting the ‘bad guys’ back on the street.”

This morning, I was put on Alastair Campbell’s blog. Newt Gingrich seems to agree with the direction we are taking, Alastair Campbell appears to believe that we are going in the right direction, and Members from all three parties, including the Chairman of the Select Committee, agree. The right hon. Gentleman is the representative of a failed past.

[Philip Davies (Shipley) (Con)]

Last year, 3,000 burglars and 4,500 violent criminals with 15 or more previous convictions were not sent to jail, and people with more than 100 previous convictions who came before the courts were more likely not to be sent to jail. They reoffended not because they went to prison, but because they did not go to prison. How on earth can my right hon. and learned Friend accept the figures that his Department has issued and say that too many people are going to prison? Most people would look at those figures and conclude that too few people are going to prison.

[Mr Clarke]

A court has to look at the nature of the offence and the individual offender and give the right sentence. For serious criminals, that means going to prison; for recidivist offenders, that means going to prison; for others, it might be more appropriate for a strong community sentence to be made available. It is not possible to generalise in such a way. At the heart of what we are doing is ensuring that judges give the right punishment and that they give us a rest while people are in prison. The system is simply failing to prevent people reoffending. That is what the policy focus has to be and that is what will reduce crime if it is successful.

[Mr David Blunkett (Sheffield, Brightside and Hillsborough) (Lab)]

Perhaps the Secretary of State will remember that, back in 2001, there was something called the Halliday review of sentencing. In July of that year, I talked—much as the Secretary of State has done this afternoon—about avoiding reoffending. Does he acknowledge that a £40 million cut in the South Yorkshire police budget, more prisoners on the street, and more offenders reoffending because the police are not available to protect the public and the victims is not a charter for common sense? It is a charter for criminals to get on with the job that they have been doing and from which we have been trying to protect the public.

[Mr Clarke]

The budget for the Prison Service and the probation service in my Department increased by roughly 50% in real terms over the past seven years. The idea that the only approach to criminal justice policy—as with other policies—is simply to spend and borrow more and more is what got the previous Government into the sorry state in which they eventually collapsed. We must now do things more intelligently and sensibly, and address the problem of reoffending. I am afraid that the right hon. Gentleman was unsuccessful when he turned to that in 2001.

[Claire Perry (Devizes) (Con)]

Will the Secretary of State talk specifically about the issue of foreign offenders in the prison system and what he proposes to do to free up prison places by a change of policy in that area?

[Mr Clarke]

The number of foreign prisoners in our prisons roughly doubled in the past 10 years, during the period of office of the previous Government who rather went backwards and forwards at various times about whether they were releasing people who might have been deported or keeping them here because they could not be deported. It is difficult to get large numbers out, but we are determined to make an effort to do it. We are looking at ways in which, in suitable cases, conditional cautioning could get people out of the country and diverted out of our criminal justice system altogether on the basis that they never come back. We are also looking at how we can encourage other countries to take back prisoners who are eligible for deportation to ensure that this extraordinary burden, which has grown in the past few years, is eased, because there are better things we can do in the whole system with the money we are spending on foreign prisoners.

[Alun Michael (Cardiff South and Penarth) (Lab/Co-op)]

I am pleased that the Justice Secretary intends to build on the success of the youth offending teams, which I introduced in 1998. Will he ensure that the youth courts, and indeed the courts generally, follow the central recommendations of the justice reinvestment report by focusing clearly on what works in reducing reoffending and incentivising those outside the criminal justice system who can help to bring down crime?

[Mr Clarke]

The answer is yes. One thing on which I totally agree with the right hon. Gentleman is that we have to concentrate our resources on what works. By that I mean, from the point of view of the potential victims and society at large, what gets down the level of crime committed by young offenders in particular.

[Mr Edward Leigh (Gainsborough) (Con)]

I notice that my Conservative Secretary of State says: “Prison cannot continue to be simply an expensive way of giving communities a break.” I am sorry, but communities deserve a break—they deserve a break from being burgled. Will my right hon. and learned Friend assure me that on his watch, people who cause absolute misery by thieving from people’s homes, particularly those of elderly people, can expect to go to prison, where they deserve to be?

[Mr Clarke]

The answer to the last part of the question is obviously yes. Burglars should usually go to prison—nobody has ever suggested that they should not. I have read extraordinary suggestions that we are letting out burglars, robbers and all kinds of people. They are the core population of a prison and should remain so. The main purpose of prison is that it is the best form of punishment: it is a way of exacting some reparation from somebody for the crime they have committed. It also, of course, gives us a break from their offences while they are in prison. However, if we concentrate on that aspect of imprisonment, it is a very expensive way of giving people temporary relief from the crimes of those incarcerated. Prison should be producing people most of whom, on release, will not go back to a life of crime. Unfortunately, over a period of years, three quarters of them have eventually committted further crime. That is the failure and weakness in the system, and that is where the concentration now has to be.

[Paul Goggins (Wythenshawe and Sale East) (Lab)]

Earlier, in Health questions, the Health Secretary confirmed that he has been working with the Justice Secretary on plans to divert mentally ill offenders from prison—something that I broadly welcome. When I pressed him on how much additional funding was being made available for this, he was unable to tell me, but referred me to this statement, so can the Justice Secretary tell me how much additional money will be made available?

[Mr Clarke]

This is about both our budgets, so I had better not pre-empt my discussions with my right hon. Friend. I hope that he gave a helpful response to the question, because the two of us, together with our Departments and our officials, are working very seriously on trying to improve the situation for mentally ill people who ought not to be in prison or ought to be better treated in prison. It is not an easy subject. The reason we have so many people in prison who obviously ought not to be there because they are suffering from mental illness is that it is difficult to devise services that will not only help them but improve their behaviour and make them less of a risk to the community at large. At this stage, we are consulting on it. However, I can assure the right hon. Gentleman that there is a genuine commitment on the part of my right hon. Friend and me to ensure that the Department of Health, the NHS, the National Offender Management Service and the Prison Service work together properly so that people are dealt with in a more suitable and civilised fashion. The main benefit one can give to the public regarding those whose main problem is mental illness is to help them to cope with the behavioural problems that are causing the crime.

[Tom Brake (Carshalton and Wallington) (LD)]

Can the Secretary of State confirm by how much he expects the number of vulnerable women and women with babies in prison to reduce as a result of these very sensible proposals?

[Mr Clarke]

I will not go into another precise estimate, but we need to reduce the number of women in prison. The previous Government worked on that. It is important to realise that women who go to prison—many fewer do so than men—tend to have a particular combination of problems. Compared with men, a much higher proportion of women in prison have a history of drug abuse, alcohol abuse, domestic violence and a disordered life, in all kinds of ways. Focusing on that is likely to reduce the women prison population, and we will do that. Of course, as with men, there is a hard core of women who are hardened criminals or antisocial people, and they must be incarcerated for long sentences when they do something that deserves it.

[Keith Vaz (Leicester East) (Lab)]

I have no quarrel with the vision set out by the Secretary of State for Justice. It is in keeping with many recommendations made by the Home Affairs Committee over many years. I do have a quarrel with the detail, however. Last year, there were 4,600 hospital admissions as a result of knife crime. Will he confirm that it is still the policy of the Government that those who are caught carrying knives will be sent to jail?

[Mr Clarke]

I am grateful that the right hon. Gentleman does not differ in principle. I do not think that Opposition Front Benchers do either; they certainly do not have an alternative to put forward. Knife crime is a very serious matter. We are clear that the use of a knife in crime is serious. Anybody who stabs somebody else will go to prison—they usually do and they always should. Anybody who uses a knife in a threatening way in the course of a crime should go to prison. Anybody who carries a knife in circumstances in which its imminent use is likely should go to prison.

However, we have to avoid absolute tariffs that set in statute what the punishment should be for every particular offence. That was a mistake made by the previous Government. To fill up more than 20 criminal justice Acts, they produced ever more complicated and prescriptive rules, which judges sometimes find incomprehensible and which sometimes are in danger of flying in the face of the obvious justice of an individual case or the long-term interests of society.

[Anna Soubry (Broxtowe) (Con)]

The majority of the people I represented who were burglars were addicted to drugs or alcohol. Does the Secretary of State agree that residential rehabilitation is usually far more effective at stopping such people reoffending than long custodial sentences?

[Mr Clarke]

I entirely agree with my hon. Friend. She has long experience, and much more recent experience than I have, of dealing with such problems in the courts. What we must do through, among other things, the payment-by-results approach and bringing in more private, independent and not-for-profit providers, working in co-operation and partnership with statutory providers, is find better ways of achieving better results in drug rehabilitation, the ending of alcohol abuse and the treatment of mental illness.

[Kerry McCarthy (Bristol East) (Lab)]

Following on from the previous question, will the Secretary of State confirm that he will lobby for drugs funding, not just in his Department and the Home Office, but in the Department of Health? Unless drug treatment programmes are funded, we will not be able to treat drug addicts and prevent them from moving into the criminal justice system.

[Mr Clarke]

I will. My right hon. Friend the Home Secretary takes the lead in the Government in tackling drug problems and the Minister of State, Cabinet Office, my right hon. Friend the Member for West Dorset (Mr Letwin), is heavily involved too. We will use payment by results widely across the piece, not just with regard to offenders, to find out what works. We will put more emphasis on genuine rehabilitation, not just keeping people dependent on methadone for as long as happens in far too many cases in prison and in the community.

[Dr Julian Huppert (Cambridge) (LD)]

I welcome the reference to the Rehabilitation of Offenders Act 1974 in the Green Paper “Breaking the Cycle”, although that reference did not make it into the statement. It follows on from the excellent report by Lord Falconer, “Breaking the Circle”, which unfortunately the Labour Government did not have the courage to do anything about. Will the Secretary of State assure me that this matter will be an important priority, particularly in ensuring that cautions become spent extremely quickly?

[Mr Clarke]

I can confirm that we are proposing to reform that matter. We are consulting on it, so I look forward to having the hon. Gentleman’s representations on what level of offence should never be excluded from disclosure, how long it should take for cautions for other offences to be spent and what we should do about juvenile offences, which are sometimes held against people for far too long in what has become a law-abiding adult life. We will not duck the issue, we will reform the system and I look forward to hearing his views.

[Mr Chuka Umunna (Streatham) (Lab)]

HMP Brixton is in my constituency, and 80% of the prisoners there are on short-term sentences of less than four weeks. I will look at the Green Paper to see what it will do to address the fact that it is difficult to rehabilitate within that time frame. I was e-mailed last week by the prison’s independent monitoring board, which made it clear that there should be absolutely no cuts to the prison. What guarantee can the Secretary of State give me that the Green Paper will not be used to impose cuts on my local prison?

[Mr Clarke]

I realise the difficulties of a prison such a Brixton, with such a high proportion of its population being short-term prisoners. We cannot get rid of all short-term prison sentences. I have never believed that that was possible, because magistrates face people who have come before them frequently, and they have tried everything else. In such cases, there is absolutely no way of dealing with their recidivist behaviour other than to send them to prison, or sometimes back to prison yet again. I hope that some of the payment-by-results providers will be able to start providing rehabilitation for such people, for whom no provision is currently made once they are put out of the door.

As far as spending on the Prison Service is concerned, we are affected, as in every other service, by the financial constraints we are under. It is not true that it is not possible to make any savings in how we run the prison estate. Spending on the Prison Service will depend in large part on what burdens are imposed on the system in future years by the level of crime and sentencing patterns, because it is partly a demand-led service. I cannot simply give an undertaking that nothing will be changed. We intend to follow on from the last Government’s policy of using competition, among other things, to test costs and ensure that we have the most cost-effective way of providing the quality of service that we want to provide.

[Rehman Chishti (Gillingham and Rainham) (Con)]

As someone who both prosecuted and defended in criminal courts before coming to this place, I wish to mention the possession of knives. Does the Secretary of State have an assessment of the effect of the Violent Crime Reduction Act 2006, which increased the sentence from two years to four years? Does he agree that the best way to deal with knife crime is to deal with the gang culture that leads to the possession of knives?

[Mr Clarke]

Yes, I think the possession of knives is a scourge on society, particularly when it is associated with gang culture and all the other problems that it causes in many communities. I repeat, however, that judges and magistrates are in the best position to decide on the circumstances of a particular offence, the circumstances of the offender and the best way of imposing a penalty that protects the public.

We have to get away from the habit of the past few years of leaping in with a tariff that takes discretion away from the courts in each and every category of case. The tariff works in some cases but then, the next thing we know, the people who campaigned for it are campaigning like mad against some obvious injustice because it is inflexibly applied to some person who would be better dealt with in other ways.

[Mr David Crausby (Bolton North East) (Lab)]

Earlier this year in my constituency, a driver who had been drinking crashed into a group of teenagers on the pavement, seriously and permanently injuring them. At the trial, the judge bitterly complained that he could give him only the maximum two-year sentence for dangerous driving. Will the right hon. and learned Gentleman join me in supporting the Drive for Justice campaign to give judges more flexibility in sentencing dangerous drivers?

[Mr Clarke]

I shall have a word with my right hon. and learned Friend the Attorney-General, because that is a perfectly valid point that we will consider. There is, of course, a higher penalty for causing death by dangerous driving, but the hon. Gentleman describes someone who behaved equally reprehensibly but happens not to have killed any of the victims. As I am arguing for discretion, we will look at whether the constraint is too tight.

In the case of ordinary dangerous driving without any serious consequences, and although I deplore all dangerous driving, we cannot start imposing heavy prison sentences on everybody who might otherwise be a blameless citizen and then behaves in an absolutely reprehensible way when driving his car. Some cases, such as the one described, make the case for having a look at the two-year maximum.

[Mr Robert Buckland (South Swindon) (Con)]

I welcome the proposal in the Green Paper to expand the principle of restorative justice, but will my right hon. and learned Friend assure me that any moves to expand that approach will be victim-led rather than offender-led?

[Mr Clarke]

The answer to that is yes, I will. Restorative justice is proving to be remarkably successful, but I take my hon. Friend’s point that it does not work if victims are not in the leading role. We have ensured very high levels of victim satisfaction in most of our experience so far of steadily spreading restorative justice.

[Mrs Jenny Chapman (Darlington) (Lab)]

I welcome the Secretary of State’s road-to-Damascus conversion to rehabilitation. I made a note of some of the promises that he makes in the Green Paper, which include regular working hours, restorative justice, custody diversion, and drug, alcohol and mental health services. What bothers me is that if those things are to be effective, they cannot be done on the cheap. It is wrong of him to promise such investment in rehabilitation, because the 23% cut to the Ministry of Justice and cuts in probation mean that those promises are completely undeliverable.

[Mr Clarke]

I make the point again: the hon. Lady does not appear to disagree with any of those proposals, but they were not priorities of the Labour party when it was in office. That is not where the money went. The Labour Government spent money on a colossal scale, but it did not go into the objectives that this Government now advocate.

Otherwise, to be fair, the hon. Lady makes a valid point. The House should understand that achieving the results that we want will take time. We are dealing with difficult problems, such as mentally ill prisoners, which are incapable of instant, overnight solution—[Interruption.] It is no good her making gestures about spending money, because simply spending money on mentally ill prisoners will not get us very far. We must spend money intelligently.

We are talking about a whole Parliament, but I emphasise that payment by results does not involve putting money up front. It avoids the danger of giving grants to this or that hopeful-sounding idea or project. Sadly, some of those projects do not work. Paying by results means that we will pay for what works. The projects that succeed will spread more rapidly.

[Mark Reckless (Rochester and Strood) (Con)]

The secure training centre in my constituency protects the community when young people are locked up there, and often teaches them to read. As that costs more than £100,000 a year, what will the Secretary of State do to ensure that those benefits carry over when those young people are released?

[Mr Clarke]

It costs about £170,000 a year to keep somebody in a young offenders institution. Those who think that the numbers being detained are inadequate might reflect upon that. I agree strongly with my hon. Friend that what matters is the rehabilitative supervision that is in place after detention, with the support to deal with whatever the young person’s problems are in addition to his bad behaviour. In that way, we ensure that we reduce to the absolute minimum the risk of his reoffending and getting back into the system.

[Luciana Berger (Liverpool, Wavertree) (Lab/Co-op)]

Further to the questions asked by my right hon. Friend the Member for Wythenshawe and Sale East (Paul Goggins), and my hon. Friends the Members for Bristol East (Kerry McCarthy) and for Darlington (Mrs Chapman), can the Secretary of State confirm whether extra cash will be made available by either the Ministry of Justice or the Department of Health to support all the rehabilitation measures that he outlined today?

[Mr Clarke]

I realise that the hon. Lady is a new Member of the House—[Interruption.] If the Labour party cannot move on from reacting to every social problem by saying that there must be more public expenditure and borrowing—Labour Members think that if we demonstrate that, we are tackling the problem effectively—it has no role in the government of this country for many years to come.

[Dr Thérèse Coffey (Suffolk Coastal) (Con)]

I very much welcome my right hon. and learned Friend’s announcement that those who commit a crime using a knife can expect to be sent to prison. However, will he elaborate on another part of his statement? He mentioned having a sentencing framework that is comprehensible to the public, which I hope also applies to victims. I found during the general election that a number of my constituents do not understand why, when somebody is sentenced to six years, they automatically go home after three.

[Mr Clarke]

I have no anecdotal recollection of anybody who has stabbed somebody not going to prison. Actually, people who do not stab someone because they are stopped in time should go to prison too. A serious knife crime justifies a prison sentence, and I think that we can rely on judges to give serious prison sentences. They do not have to be told that the use of a knife in a crime deserves a serious sentence. However, if they want to be told, I and my hon. Friends will tell them.

Public understanding of the system is important. We will consider how sentences can be expressed in terms that the public understand. People do not understand that when someone is sentenced to a certain number of years in prison, they serve the first half in prison and the other half on licence, which means that they will be recalled to prison if they start falling down in their behaviour. There are many other aspects of our incomprehensible sentencing arrangements that are difficult to get across to the public. The rules given to judges for explaining sentences are a hopeless mess and need to be simplified, and I agree with my hon. Friend that we need to make it more transparent and clearly available to the public.

[Mr Speaker]

Order. May I remind the Secretary of State that I am always keen to hear his answers? I know that his natural courtesy inclines his head backwards, but I would like him to look at the House.

[Kevin Brennan (Cardiff West) (Lab)]

Instead of giving prisoners the vote, why does the Secretary of State not incorporate the withdrawal of that civic right in a prison sentence? If he does not do that, will people not think that he actually wants to give prisoners the vote?

[Mr Clarke]

The hon. Gentleman was a Minister in the last Government for—I think—the past five years. For five years, the last Government accepted that they had to give some prisoners the vote. They consulted on it every now and then, but they did nothing. He should have come forward with his helpful suggestions when he was in office. We are about to produce our proposals on how to comply with the relevant judgment, but that will not involve giving all prisoners the vote. We will consider some of his points and then get on with it. The Government led by the previous Prime Minister were often incapable of taking a decision and getting on with anything.

[Priti Patel (Witham) (Con)]

Will the Secretary of State reassure my constituents and guarantee that dangerous criminals, such as paedophiles, will receive demanding and robust punishment in prison so that our streets are kept safe for our children?

[Mr Clarke]

Yes. It is sometimes difficult to debate law and order in this country. Occasionally, I have to listen to a kind of looney-tunes debate about whether I am starting by releasing murderers, rapists, burglars or paedophiles. I believe that serious criminals should be in prison. I have never met a sane person who wishes to disturb that. I believe in long and severe sentences for people guilty of such a serious crime as paedophilia.

[Clive Efford (Eltham) (Lab)]

May I suggest that the Secretary of State visit, as I did recently, the Isis centre at Belmarsh prison, which is taking some innovative steps towards rehabilitating young offenders? With that in mind, I think that young offenders sometimes need custodial sentences to turn their lives around. Will he confirm therefore that judges will not have the discretion to give anything other than a custodial sentence to someone who uses a knife in a criminal act?

[Mr Clarke]

I think I can, although I do not think we need to put it in statute. I would be utterly astonished if a judge did not give a custodial sentence to anybody who used a knife in a criminal act. I approve of prison sentences in such cases, but I do not think we need to legislate on it. It is the nuances of far less serious cases that will get us into difficulty. However, if a person stabs somebody, they should go to prison, and I would be quite shocked if somebody did not go to prison in such circumstances.

[Paul Uppal (Wolverhampton South West) (Con)]

In September, I met an ex-prisoner who told me that a continual stream of custodial sentences was broken only when he swapped a life of crime for a life as a conscientious father. What measures can we consider to ensure that the families of offenders, and not just the offenders in isolation, are supported on the road to rehabilitation?

[Mr Clarke]

We would like to give professionals every possible encouragement to follow that advice. People who are criminal for a part of their lives and then stop often do so because family responsibilities and a secure family environment have taken them back into a more sensible and decent way of life. We intend to give the professionals more discretion in how they do that. The last Government were prone to setting targets, prescribing methods and setting down rules for community sentencing.

[Mr Jack Straw (Blackburn) (Lab)]

It worked.

[Mr Clarke]

It did not work, despite what the right hon. Gentleman says. Over and over again, the professionals complained they spent half their lives in an office ticking boxes confirming that they had taken the prescribed course, rather than being able to tackle in an individual way the kind of problems my hon. Friend heard about when he met his constituent.

[Fiona O'Donnell (East Lothian) (Lab)]

Let me begin by telling the Secretary of State that my hon. Friend the Member for Liverpool, Wavertree (Luciana Berger) and I may be new, but we are not daft. He said that prison could not be just an expensive way of giving communities a break. For victims of domestic violence, that break can be priceless or even life-saving. What reassurances can the Secretary of State give to victims about the criteria that he will use in deciding which IPP prisoners—those sentenced to imprisonment for public protection—who have completed their minimum tariffs will be released?

[Mr Clarke]

We are not just going to let IPP prisoners out—any of them. Release will be by the Parole Board. The Parole Board is currently experiencing considerable difficulty in evaluating whether prisoners can prove that they are a minimal risk when they are released, because it is very difficult to demonstrate that when the prisoner is in prison. We are going to readdress IPPs, to try to make them work as they were originally intended, for a comparatively small number of very dangerous offenders who pose a continuing risk, and look at the test that the Parole Board can apply. However, no one will be released until someone has assessed whether the level of risk is acceptable. It is impossible to guarantee no risk: there is nobody in prison about whom anybody could ever say, “This person is never going to be at risk of offending again.” I am afraid that, in the real world, there is nothing we can do about human nature. Quite a number of the people in prison will inevitably commit crimes when they come out, but the number who reoffend has to be reduced, the IPP ones have to handled very carefully, and the Parole Board has to be given a proper test to apply.

[Mr David Nuttall (Bury North) (Con)]

Further to the reply that the Secretary of State gave to my hon. Friend the Member for Suffolk Coastal (Dr Coffey), does he agree that if we are to restore the public’s trust in the criminal justice system, there must be honesty in sentencing and that convicted criminals should serve the full length of any sentence of imprisonment handed down by the court?

[Mr Clarke]

I agree with honesty in sentencing—I have always supported that idea—and we will certainly be addressing the way in which it is explained by a judge in court, so that it is clear and comprehensible to the public. That includes explaining the term of imprisonment and the term of licence that follows—what is currently called “serving half the sentence”. The first half is in prison; the second half is subject to recall to prison, but it is served on licence out in the community. To turn the full term into imprisonment, which no one has ever done, would merely involve doubling the sentence for every prisoner. The financial objections to that are only the first ones that I would raise.

[Steve McCabe (Birmingham, Selly Oak) (Lab)]

Surely the courts must always determine when a custodial sentence is required. The public will not understand what sounds like the Secretary of State saying that he or the Treasury is setting out to constrain that decision making.

[Mr Clarke]

With great respect, I am obviously being particularly obscure today, because I agree with the hon. Gentleman; indeed, I was saying precisely the opposite of what he described. We have spent the last 10 years or so believing that sections of statute—some of which read rather like local government circulars—are required in order to tell the judges what to do in individual cases, and that we should prescribe exactly what they do, according to some careful analysis. The judges complain like mad about the incomprehensibility of the legislation they are supposed to be applying. I firmly agree with the hon. Gentleman that, by and large, judges are in the best position to judge the appropriate way of dealing with each case and each offender, just as juries are the right people to decide guilt or innocence in serious cases. Parliament must stop trying to second-guess and introduce rules that we believe, with the best of intentions, cover all cases but which will not cover the absolutely amazing variety of circumstances that tend to accompany any particular category of crime.

[Paul Maynard (Blackpool North and Cleveleys) (Con)]

I congratulate the Secretary of State on avoiding the siren calls of populism that I have been so disappointed to hear on both sides of the House today. Will he reassure me that when a prisoner is in prison, not only does he have a duty to make reparations but the state also has a duty, to offer him the opportunity of redemption, so that when he leaves that place of incarceration he has a chance to lead a useful and meaningful life—a life that is not reduced to one of stigmatisation or described, as I heard from the Opposition Benches, as that of a prisoner on the streets?

[Mr Clarke]

I agree with my hon. Friend entirely. We should give those who have the backbone to go straight, with help, a chance to do so because that will protect the public. Those who do not, and who commit crime again, will be punished again. It is just hopeless to suggest that giving extra emphasis to reforming criminals who want to be reformed is somehow weakening in the context of law and order; it is not. It would improve the protection of the public if we did it, and, as my hon. Friend says, it is a perfectly sensible way for a civilised state to behave.

[John Mann (Bassetlaw) (Lab)]

Bassetlaw has the largest drug treatment programme in the country by far. We have reduced crime further by locking up repeat offenders. The Secretary of State is trying to get rid of the courts, he is getting rid of 300 front-line police officers, and now he is conducting this social experiment. Can my community, which is totally against this idea, please have an exemption? We could then compare and contrast the results to find out what works best.

[Mr Clarke]

One day I will convert the hon. Gentleman. With great respect, I think that he has been a great leader in his community in tackling the problem of drugs in Bassetlaw, and it is partly down to his efforts that it has been tackled in that part of Nottinghamshire much more forcefully than ever before. We are going to send repeat offenders to prison; no one is going to stop punishing people who keep offending. It is not a key part of the legal system in north Nottinghamshire that we should keep redundant courts, although we are still consulting on the two courts in his constituency. The foresight that he has shown on the problems of drugs will not be frustrated by our attempts to improve yet further the drug rehabilitation programmes that young people get in his constituency. This is not all about money, and that has not actually been the way he has approached this issue in the past few years either.

[Mr Philip Hollobone (Kettering) (Con)]

Last year, more than 20,000 offenders with 15 or more previous convictions or cautions, and more than 2,500 offenders with more than 50 prosecutions or cautions, avoided a jail sentence. Will my right hon. and learned Friend’s proposals not simply make that matter worse?

[Mr Clarke]

I do not think that they will make any difference, really—[Interruption.] No, do not start misquoting me. If the right hon. Member for Tooting (Sadiq Khan) cannot find anything that I have said to disagree with, I hope that he will not start misquoting me in order to find something. I would need to work through those 2,000 cases, and my first question would be to ask what the further offence was that they were up for. I am sure it was not parking. People who have previously committed a crime are not always sent to prison again, and the first thing we have to ask is how serious is the matter for which they are before the courts again. I hate to cast doubt on my hon. Friend’s statistics, but a lot of the statistics used across this whole field as the basis for these arguments are hopelessly unreliable. We are not reducing punishment for serious crime, and we are not letting anybody out of prison. We are using prison as a punishment, and trying to prevent the kind of people that he has described from reoffending over and over again, because that is in the public interest.

[Mr Rob Wilson (Reading East) (Con)]

My right hon. and learned Friend will know that education is key to rehabilitation in prisons. What facilities are there for young people in prisons such as the Reading young offenders institution, where big central contracts have failed and more local provision is needed under the guidance of the governor of the prison?

[Mr Clarke]

We will of course continue to try to improve the level of education available to people, particularly in young offenders institutions. We are reviewing the educational service, and I agree that in many cases a more localised approach is likely to produce a better standard of education services than attempts to impose some kind of centralised system.

Points of Order

Tuesday 7th December 2010 Commons Chamber

16:34

[Mr Gareth Thomas (Harrow West) (Lab/Co-op)]

On a point of order, Mr Speaker. Last Tuesday, the House debated the need for more information on higher education, including, crucially, on the access requirements that universities will have to meet in order to be able to charge the maximum £9,000 fee. According to press reports today, universities could be stripped of their right to charge students more than the lower level of tuition fees, yet actually, that sanction already exists, and guidance referred to in media reports suggests that there are no new changes to the legal constraints on university powers. Many people will wonder whether any university wanting to charge the full £9,000 will really be held back from doing so in practice. What steps can you take, Mr Speaker, to ensure that the House has a full and, crucially, accurate picture of the Government’s plans for higher education before Thursday’s vote on tuition fees?

[Mr Speaker]

I am grateful to the hon. Gentleman both for his point of order and for advance notice of it. The short answer to his question is that there will be an exchange on this matter on Thursday. I have every expectation that the full details of policy will be communicated, teased out, debated and made the subject of proper political argument. That, I think, is the most hopeful reassurance I can offer the hon. Gentleman. I have not received notice of any other ministerial statement, and I should not have expected to do so, but the opportunity presented later this week is one that I am sure he and others are eagerly anticipating.

[Clive Efford (Eltham) (Lab)]

On a point of order, Mr Speaker. As you know, I am a shy and retiring Back-Bench Member of Parliament, and I am becoming increasingly distressed by the aggressive attitude of Government Members, particularly as we approach Thursday’s vote on tuition fees. I wonder whether you have received an apology, Mr Speaker, for the Chief Whip’s behaviour in the Chamber last night, as some of us feel that such an apology should be forthcoming.

[Mr Speaker]

I am grateful to the hon. Gentleman for his point of order. The House of Commons can be an excitable place, and in his 13 years here, the hon. Gentleman has witnessed examples of that. I am satisfied, however, that in respect of the business of House motion, no procedural irregularity whatever occurred. Discourtesy in the House is to be deprecated. Defiance of the Chair is totally unacceptable, and when it takes place, I make it clear in no uncertain terms that it should not take place again. I think that any Member, no matter whether that person be the newest entrant or one of the most senior office holders, will recognise that, in the cold light of day, that is the way it has to be.

Safe Standing (Football Stadia)

Tuesday 7th December 2010 Commons Chamber

Motion for leave to bring in a Bill (Standing Order No. 23)

16:37

[Mr Don Foster (Bath) (LD)]

I beg to move,

That leave be given to bring in a Bill to give all football clubs the freedom to build, or maintain existing, safe standing sections in their stadia if they choose; to establish minimum safety criteria that must be met for standing sections in football stadia; and for connected purposes.

Any debate on football stadiums will inevitably, and quite rightly, raise the spectre of the tragic events at Hillsborough in 1989 and those that preceded it such as in the Heysel stadium in 1985. No debate on this topic can avoid addressing those tragedies and their repercussions, which still resonate with us even now. The events of 15 April 1989, which saw the deaths of 96 people and the injury of hundreds more, were uniquely horrific. An entire city has struggled with that day’s trauma ever since. The annual memorial services held at Anfield and elsewhere show that that day is still keenly felt and will never be forgotten, and nor should it be.

Nor should anyone believe that in raising the possibility of introducing safe standing in football grounds now, I am critical of the actions that were taken more than 20 years ago to outlaw standing at matches in the top two football leagues. I am certainly not calling for a return to the old-style terraces, which were poorly designed, overcrowded, poorly monitored and entirely unsuitable for the purposes for which they were used. A return to that world would be a retrograde and wholly unacceptable step.

Today, I propose something very different—another step forward to more modern, safe football stands that provide what fans want, but do so with maximum safety. After all, standing is not inherently unsafe. Lord Taylor’s report into Hillsborough cited many reasons why the disaster occurred, but the fact that the crowd was standing was not one of them. It happened, rather, as a result of gross overcrowding, a lack of concern for the safety and comfort of spectators, a lack of awareness of existing safety regulations and the poor design of the old-style terraces. The disaster happened because of a culture of negligence, not because standing is inherently unsafe.

Lord Taylor went on to recommend all-seater stadiums, because he argued that seats establish individual areas for individual fans and give them more space and comfort, prevent crowd surging, and make it easier to identify troublemakers in the crowds. I shall discuss how modern safe standing preserves those features in a moment, but it is worth noting that in making his recommendations Lord Taylor believed that fans would become accustomed to sitting and come to prefer it. Some 20 years later, the views of thousands of fans in the premiership and the championship demonstrate that that has not been the case.

When fans stand in all-seater stadiums today, it causes problems: it ruins the experience for those who want to sit. Equally, sitting ruins the experience for the many fans who prefer to stand. When they do stand, as many do, it is particularly unsafe. Yet, as we know, preventing large numbers of people from standing in all-seater stadiums is extremely difficult for stewards and the police. If it can be done safely, as I believe it can, it would be far better to have a mix of safe seating and safe standing areas in stadiums where clubs choose to offer such options. That way, children, families and others who want a more peaceful experience could have it, while those who want to stand could exercise that right. This can be done.

Countries such as the United States, Canada and Germany are certainly not negligent towards their citizens’ safety. They have harnessed technological developments to create standing areas that truly are safe, and such areas are a popular choice with supporters. In such areas, as with seated areas, there are designated spaces for each fan, and there are barriers between rows, preventing surging, pushing or jostling. Individual fans can be easily identified if they are causing trouble, because they are limited to their own individual spaces. Thus, the key reasons why Lord Taylor recommended seating can also all be met with safe standing. In many cases, each individual standing area comes with its own flip-down seat. That corresponds with UEFA and FIFA rules that require international and European matches to be seating only. There is absolutely no evidence that such standing areas, where properly designed, managed and maintained, are unsafe for domestic matches. As numerous polls have shown, they are overwhelmingly backed by supporters and, as they create more space for fans, clubs could then reduce the price of tickets, thus offering another benefit for fans.

The question of standing is even more pressing for fans of Scunthorpe United football club. For them, promotion has come at a very high price. After Scunthorpe United FC’s third season in the top two tiers, it will have to have converted its ground into an all-seater venue. That will reduce the ground’s capacity, which is already the lowest in the championship, from 9,000 to 8,000. Neither the club nor its supporters want that. More seats mean less space, and so fewer supporters will get to see their team. If Scunthorpe United FC is demoted in future, it will not be able to convert some of its seating back into standing areas. The conversion will have come at tremendous expense, and Scunthorpe United FC will have paid for the privilege of ruining its own ground. I am grateful to the hon. Members for Scunthorpe (Nic Dakin) and for Brigg and Goole (Andrew Percy), on whose constituents this change has an impact, for their support for this Bill.

I am also grateful to the Minister for Sport and the Olympics, who I see in his place, for agreeing at least to consult relevant bodies. Sadly, I suspect that he will hear, as I continue to do, some outdated criticisms. Some will raise the issue of cost but, as my Bill proposes, that should be a matter for individual clubs to decide. Some will suggest that spectators have become used to sitting and like it, but that is patently untrue, as the long-running campaigns by football fans’ organisations show. Some will argue that statistics prove that seated stadiums are safer than standing ones. For some years, the Football Licensing Authority did claim that. However, when its statistics were challenged as inaccurate, it subsequently withdrew them. As my Bill makes clear, minimum safety standards would be nationally established before any new safe standing areas are permitted.

Some might claim that seating has reduced hooliganism, but even before Hillsborough, hooliganism was declining. Inside grounds and outside, in clubs that are all seated and in clubs that are terraced, hooliganism has receded. The character of this country’s fans has changed for the better. For example, no England fans were arrested at the World cup in South Africa with the exception of the practical joker who sneaked into the England team’s dressing room. The decline in football hooliganism is not directly because of a move to all-seater stadiums. Last week’s Home Office arrest figures show no evidence of any link between grounds where standing is still allowed and the number of arrests. There is no reason to believe that a move to introduce safe standing areas would mean an increase in hooliganism.

Finally, I have no doubt some will raise the issue of the UEFA and FIFA rules, which I mentioned earlier, that games under their jurisdiction must be played in all-seater stadiums, but with the inclusion of flip-down seats in each standing area those regulations present no problem, as was demonstrated in the Veltins arena in Germany, which was used for the 2006 World cup, and the Tivoli Neu stadium in Innsbruck, Austria, which was used during Euro 2008.

I defy opponents of safe standing to demonstrate that those stadiums are unsafe and that those countries are neglecting the safety of their fans by allowing standing. Following the Hillsborough disaster, it was right to take action against the old-style standing terraces, but modern developments mean that, as other countries have shown, it is perfectly possible to introduce safe standing into the stadiums of premiership and championship clubs if the clubs want to and when stringent safety standards are met. I hope the House will support moves to allow clubs to consider such options.

Question put and agreed to.

Ordered,

That Mr Don Foster, Andrew Percy, Nic Dakin, Greg Mulholland, Mr John Leech, Mr Mike Hancock, Bob Russell, Mr Roger Godsiff and Kate Hoey present the Bill.

Mr Don Foster accordingly presented the Bill.

Bill read the First time; to be read a Second time on Friday 17 June, and to be printed (Bill 121).

European Union Bill

Tuesday 7th December 2010 Commons Chamber

[Relevant documents: The Tenth Report from the European Scrutiny Committee, European Union Bill and Parliamentary Sovereignty, HC 633 I and II, and the uncorrected transcripts of oral evidence taken before the Committee on 22 and 25 November and 6 December HC 633-i, ii and iii.]

Second Reading

[The Secretary of State for Foreign and Commonwealth Affairs (Mr William Hague)]

I have it in command from Her Majesty the Queen to acquaint the House that Her Majesty, having been informed of the purport of the European Union Bill, has consented to place her prerogative, so far as it is affected by the Bill, at the disposal of Parliament for the purposes of the Bill.

[Mr Deputy Speaker (Mr Nigel Evans)]

Mr Speaker has selected the amendment in the name of the official Opposition.

16:48

[Mr Hague]

I beg to move, That the Bill be now read a Second time.

In the past 25 years, the EU has changed many times, each change marked by a new treaty: the Single European Act, the Maastricht treaty, the Amsterdam and Nice treaties, the failed EU constitution and its modified successor, the Lisbon treaty. As a result, the EU now has a greatly enlarged place in our national life, policy and politics. At the same time, we have seen a growing disconnection between the people who put us here in Parliament—the British people, the voters—and the EU’s institutions. There is a growing sense, shown by falling turnout in European elections and a variety of surveys, that the EU’s democratic legitimacy in this country has been weakened.

It can be said in mitigation that all but one of those treaties had its place in the manifesto of the party that won the general election, the exception—a rather important exception—being the last such treaty, the Lisbon treaty. It cannot be denied, however, that there is a problem—a severe one—that will only grow worse unless we take steps to address it, and the European Union Bill is part of the coalition Government’s answer to that problem. Indeed, the crowning argument for the Bill was the behaviour of the last Government, who opposed a referendum on the EU constitution, then promised one, then refused to hold one on its substantially similar reincarnation as the Lisbon treaty. The Bill will prevent Governments from being so deceptive and double-dealing when it comes to giving voters a say.

[Mr Tobias Ellwood (Bournemouth East) (Con)]

I congratulate my right hon. Friend on introducing this important Bill, which will ensure that parties do not make a proposal on one side of an election only to conduct a U-turn on the other. Has he had any discussions with the Labour party on its position on the Bill, or will it be walking into the next election supporting a case in which the British electorate will again be denied the opportunity to conduct affairs on Europe?

[Mr Hague]

That is something for the Opposition to consider and they will have some time to do so before the next election. The position set out in their amendment appears to be at best uncertain in that they agree with the principle of doing such a thing but not with doing it in practice. That is rather like the position they often occupied in government of being in favour of referendums but never actually holding one on any European matter for which they were responsible.

[Ms Gisela Stuart (Birmingham, Edgbaston) (Lab)]

rose—

[Mr William Cash (Stone) (Con)]

rose—

[Mr Hague]

I shall take an intervention from the Opposition before I give way to my hon. Friend. The hon. Member for Birmingham, Edgbaston (Ms Stuart) did, of course, favour a referendum on the Lisbon treaty.

[Ms Gisela Stuart]

How would the Secretary of State describe a party that promised a referendum and then, in order to avoid one, simply changed the question, as the Members who are now in coalition with his party did in the last election?

[Mr Hague]

I am not here to answer for the party policies of other members of the coalition but for the coalition Government as a whole. The hon. Lady can rest assured that both parties in the coalition join strongly in their support for the Bill. It is sponsored by the Deputy Prime Minister and the Prime Minister, and it is therefore easy for people in a third party to join us in supporting it, as the hon. Lady will no doubt want to consider doing.

[Mr Cash]

Given that we stood united as a party in opposing the Lisbon treaty and supporting a referendum, and given that we voted for that, will my right hon. Friend explain why we have done a U-turn on that within the coalition Government? Will he also explain why he was not prepared to come to my European Scrutiny Committee to explain the circumstances behind the Bill?

[Mr Hague]

On the first point, I do not think the coalition Government have done a U-turn, as the Bill implements part of the coalition agreement that was set out in the few days after the general election. It is true that the Conservative party, when the Lisbon treaty was ratified last year, said that in those circumstances we could no longer hold a referendum on the treaty. That, of course, was made clear before the general election. My hon. Friend is being a little unfair to both parties in the coalition.

On the second point, I understand that my hon. Friend the Minister for Europe gave a splendid exposition of the Government’s position to the European Scrutiny Committee. As the Minister who was most involved in drafting the Bill, he was best equipped to go before the Committee. I look forward to discussing these issues with my hon. Friend the Member for Stone (Mr Cash) on many occasions. Let there be no fear about that.

[Mr Bernard Jenkin (Harwich and North Essex) (Con)]

In our manifesto we promised to amend the European Communities Act 1972, and the coalition agreement states:

“We will amend the 1972 European Communities Act so that any proposed future treaty that transferred areas of power, or competences, would be subject to a referendum on that treaty—a ‘referendum lock’.”

But the Bill does not amend that Act.

[Mr Hague]

My hon. Friend may have worked out that the Bill has exactly the same effect as amending the Act and that it therefore absolutely honours the commitment in the coalition agreement. We additionally agreed, in the coalition agreement, that we would not agree to any transfer of powers from Westminster to Brussels for the duration of this Parliament. In addition, if Parliament approves the Bill, any future treaty change that transfers powers from Britain to the EU could be agreed only subject to the consent of the British people. That will provide a referendum lock to which the British people hold the key. The Bill makes a very important and radical change to how decisions on the EU are made in this country. It is the most important change since we joined what was then called the European Economic Community. It marks a fundamental shift in power from Ministers of the Crown to Parliament and the voters themselves on the most important decisions of all: who gets to decide what.

It has been said that because the Bill will place a high democratic test before any Government can agree to participation in deeper political integration in the EU, it will marginalise Britain, but I believe that that argument is dangerously mistaken in its assumption of what progress in the EU means. The yardstick for progress in the European Union is not the depth of political integration. The lost opportunities of the past decade of institutional navel-gazing have made that plain. Progress for the European Union means its institutions’ ability and willingness to help its member states meet the challenges of today, and for us today that means our international economic competitiveness, sustainable low-carbon growth and the use of our collective weight in the world to advance our shared values and interests.

That is why, from their first day, the Government have been active and activist in European policy. That is why we have played a strong and positive role in the EU which in six months has delivered significant results—agreement on EU sanctions against the Iranian Government that are already having a material effect, and agreement on measures that will substantially aid Pakistan’s economic recovery in the aftermath of the floods. We have pushed hard at EU level on measures to further free trade, in particular with Pakistan and South Korea, thus far with success.

The UK has not taken part in every aspect of the EU’s development. The euro was created, and the decision to retain our own currency has, for example, been vindicated. Staying out of the euro and maintaining our own border controls has not weakened our influence, either. The previous Government’s successful championing of enlargement to the east, to which I pay tribute, is proof of that. In the single market—for example, on patent reform—the UK should be ready to move forward in the national interest with other like-minded partners.

As in all matters, the Government’s policy on European issues should be based on the pursuit of our enlightened national interest. Our ability to advance our goals by working with European partners is crucial to that. Ensuring that our role is based on democratic consent is equally necessary, and that is what the Bill is about.

[Mr John Redwood (Wokingham) (Con)]

Will the Foreign Secretary explain why, when the Government are giving away powers to regulate the City, powers over criminal justice, powers in two regulations and a directive that will affect our economic governance, and big new powers for an expanded External Action Service, none of those qualifies for a referendum under the Bill? People want a referendum now on the powers that the current Government are giving away.

[Mr Hague]

That is simply because we are not giving away those powers. The European External Action Service was agreed, established and given its role by the Lisbon treaty. My right hon. Friend may regret that, and I may regret that, but it was given by the Lisbon treaty. On the City, the European Union has long had the power to legislate in this area, which has equally long been subject to qualified majority voting and co-decision with the European Parliament. On economic governance, it is clear—for instance, in the Van Rompuy report on economic governance—that the proposed sanctions do not apply to the United Kingdom and that the proposed changes will not affect the United Kingdom. I reject my right hon. Friend’s basic thesis.

[Mr Edward Leigh (Gainsborough) (Con)]

Is not the argument between my right hon. Friends precisely the problem? Surely Parliament must be sovereign because the people must be sovereign. What will happen in future if there is some row about whether a referendum should take place or not once the Bill becomes law? Will not our affairs then become justiciable? Is that not an attack on the sovereignty of Parliament, which we must believe in?

[Mr Hague]

I shall come to that point. It requires clarity in the Bill, as far as possible, on the circumstances in which a referendum would or would not be held. That is the safeguard against what my right hon. Friend the Member for Wokingham (Mr Redwood) is complaining about in relation to rights that have been given away in the past. It would have been good to have a referendum on those. The Bill is about the future—let us be clear about that—and we have to make it as clear as possible.

[Several hon. Members]

rose—

[Mr Hague]

I will give way two more times and then make some progress, to be fair to the House

[Kate Hoey (Vauxhall) (Lab)]

The Secretary of State has mentioned the Lisbon treaty a number of times, saying that because of it we cannot do certain things. Surely the public will think that no Government should be committed to previous Governments’ decisions, and that it would be perfectly possible—there would be huge support for it—for the coalition Government to say, “Now we are in government, we want a referendum on the Lisbon treaty.” That would sort out the whole situation, because clearly the public would vote against it.

[Mr Hague]

As the hon. Lady knows, since the Lisbon treaty was ratified it has been built into the treaties of the EU. It does not have a separate existence once it is ratified. A referendum on that would be the same as a referendum on taking part in all the EU’s institutions—in other words, being in the EU at all.

[Kate Hoey]

Yes.

[Mr Hague]

The hon. Lady may be in favour of a referendum on that, but that is not what the Bill is about. This Bill concerns any Government proposing to give away powers in the future. Let us be clear about that.

[Mr James Clappison (Hertsmere) (Con)]

My right hon. Friend the Member for Wokingham (Mr Redwood) mentioned criminal justice powers, and the last Conservative manifesto saw fit to promise to work to bring back key powers over legal rights and criminal justice. Is my right hon. Friend aware that the Government have not just not sought to repatriate these powers, but have actually given additional powers to the European Union, as they did just last Friday when they chose to opt in to a criminal justice directive over which there was an opt-out, not only without a referendum but without even a vote in this House of Commons? Will he give serious consideration to requiring a vote of the House of Commons and the House of Lords before there are any further opt-ins to significant pieces of criminal justice legislation from the EU that will give the European Court of Justice jurisdiction over our courts?

[Mr Hague]

My hon. Friend raises a very important subject—a rather large subject, unfortunately, for those watching the length of speeches today, because I want to answer his question properly. Let us be clear that in the context of the Bill, it is any proposal to give up our freedom not to participate in justice and home affairs decisions that would be subject to a referendum. That would be from where we are starting—the extension of the power of the EU. But it is also important to be clear that the justice and home affairs ratchet clauses, as I call them, covered in the Bill amend the treaties by allowing for an expansion of what can be done within existing areas of EU competence. They are clearly passerelle clauses. We said in the coalition programme for government—that is our reference document here—that the use of any passerelle clause would require primary legislation, so that is also the case.

The opt-ins, which are a different category, are a very important subject, but they are not for this Bill. Given that there are strict time limits applying to the UK’s decision to exercise an opt-in, which is within three months of the receipt of a proposal—

[Henry Smith (Crawley) (Con)]

Will my right hon. Friend give way?

[Mr Hague]

I am answering my hon. Friend the Member for Hertsmere (Mr Clappison), so I had better complete the answer before I give way again.

The fact that there are also 30 to 40 proposals per annum means that it is not possible to place a primary legislative lock or parliamentary resolution requirement on the exercise of the opt-in. Therefore, it is important to be clear about the distinction of these different categories of decisions on justice and home affairs.

[Several hon. Members]

rose—

[Mr Hague]

I had better make some progress, because I will return to all those subjects in the course of my speech.

The nature of how our society relates to its politics, and the expectation of the British people’s involvement in decisions that affect them, has changed. In the years since 1997, we have had referendums in Scotland, Wales, Greater London and the north-east of England on proposals for devolution of power; in Northern Ireland we have had a referendum on the Belfast agreement; and legislation is before Parliament now to hold a referendum on a change to the parliamentary voting system. Changes that affect the powers exercised on behalf of the people by Parliament have been considered to be important enough to require the endorsement of the people in a referendum.

At the same time, there is a widespread perception that the really important decisions about the EU have been taken without real consideration for the wishes of the people, and much of that is reflected in my hon. Friends’ comments. Many in the House, including me, think that the ratification of the Lisbon treaty, without the promised referendum, was wrong, and it did a great deal of damage. That perception reinforces public alienation from the EU and decisions taken on the EU by Governments, and that is what we now have to put right. Therefore, we in the coalition Government have resolved that we need to rebuild trust and reconnect people and enhance parliamentary control over EU decisions, so, as with our proposals for elected police commissioners, our plans to enable parent groups to establish free schools in their communities and our proposals to hold a referendum on the voting system, we are giving more power from the centre to the citizens of this country.

[Mark Reckless (Rochester and Strood) (Con)]

The Foreign Secretary speaks of public alienation, but does he recall saying:

“If you believe in an independent Britain, then come with me, and I will give you back your country”?

Does he understand the disappointment felt by so many Members on the Government Benches and in the country about the European journey he has since taken?

[Mr Hague]

I remember well saying that. It was a very good speech, and it is recommended reading for all those who have trouble sleeping. It is even in a book somewhere, so I am grateful to my hon. Friend for quoting it. He can rest assured that I would have held a referendum on many things that have happened since then, including on the Lisbon treaty. Indeed, I asked for a referendum on other European treaties that were introduced during that time. However, it is our misfortune when we start in government, whenever we start, to start from where we are, and we start from here—in a coalition Government, meeting the commitments in our coalition agreement. That is what we now have to take on.

As hon. Members who were present for the Lisbon treaty debates might remember, there are now essentially two ways in which treaty change can be agreed by the Governments of member states: the ordinary revision procedure, under which any amendment to the treaties must be agreed unanimously by member states, and, following the Lisbon treaty, the simplified revision procedure, under which the European Council can decide to amend those parts of EU treaties devoted to internal policies, such as the single market and justice and home affairs.

Under our current law, any change under the simplified procedure, defined in this Bill as an “Article 48(6) decision”, would require only a Minister of the Crown to move a motion in both Houses and for both Houses to vote positively to approve the change. It is easy now, and it was easy in 2008 when that provision was debated, to see how that level of parliamentary control for a formal treaty change is grossly inadequate. The Bill therefore ensures that any future amendment to the treaty on the European Union or to the treaty on the functioning of the European Union, under either revision procedure that I have just outlined, will require parliamentary approval by Act of Parliament before the United Kingdom is able to ratify the change.

That is a significant addition to the powers of Parliament to hold Ministers to account for the decisions they take in Brussels. It was an addition that I championed in opposition and one that this Government will now put into statute to ensure that parliamentary control is enhanced further. That is the first thing that the Bill achieves.

[Henry Smith]

I welcome the Bill, but if it becomes law a future Parliament will be able to repeal it, so ultimately, do we not, like other European countries such as Germany, need to codify the sovereignty of this Parliament in a written constitution?

[Mr Hague]

That is a wider debate, and there is a legitimate argument for that. I hope that the Bill becomes part of the accepted constitutional framework of this country, for which, over time, it will have to receive widespread public support and the acceptance of parties from all parts of the House. The Opposition, as we have said, will have some time to think about it. Indeed, they might have a very long time before they return to government—I certainly hope so. I hope that the Bill becomes part of our permanent constitutional framework, but the argument for a written constitution ranges much wider than the scope of the Bill.

[Chris Bryant (Rhondda) (Lab)]

Will the right hon. Gentleman give way?

[Mr Hague]

Yes, I give way to the hon. Gentleman, one of those who would not hold a referendum on the Lisbon treaty.

[Chris Bryant]

The right hon. Gentleman knows well that I have long opposed referendums on almost everything. I am not a fan of referendums; I believe in parliamentary democracy, but that is a different debate from today’s.

The hon. Member for Crawley (Henry Smith) makes a good point—that the Bill does not really introduce a referendum lock. It closes the door for a while, until such time as a Government of any colour, whether Conservative, Liberal Democrat—well, that is fairly unlikely—or Labour, choose, if they want to, to derogate from the Bill in any provisions that they introduce. Is that not the danger—that the Bill might just seem like no more than political posturing?

[Mr Hague]

As I go through the description of what the Bill entails, the hon. Gentleman will understand that it is a lot more than that. It means a great deal for what happens in this Parliament. It means that not only do we have our commitment not to transfer more powers from this country to the European Union, but that in a vast range of circumstances we would have to hold a referendum if we contemplated doing so.

It will be very difficult for future Governments to go back on those commitments, but we will see; that is something for the Labour party to contemplate. In future elections, it can choose whether to say that it will weaken democratic accountability in this country or whether to accept the changes for the long term. That is a choice it will have to face, and there is no sign in its reasoned amendment today that it is yet making that choice. However, it will have to make that choice, and the hon. Member for Rhondda (Chris Bryant) will have to make it.

[Charlie Elphicke (Dover) (Con)]

Will my right hon. Friend give way?

[Mr Hague]

I shall try to space out the interventions, but I will come to my hon. Friend.

Clause 4 sets out the criteria that the Government of the day would have to apply to determine whether a transfer of competence or power would occur under a future treaty change. The Act of Parliament seeking parliamentary approval for the treaty change would also make provision for the holding of the referendum, if a referendum were required. Following the entry into force of the Lisbon treaty, the different types of EU competence—a European legal term that really means the power to act in an area of policy—and the extent of each type of competence has been set out explicitly in the treaties. Under this legislation, any extension of competence would trigger a referendum. That would also include any extension or creation of a new objective for the European Union. That is all clear in the Bill.

Power, on the other hand, is not so clearly defined, so I want to establish here what we mean by a transfer of power as set out in clause 4. First, it means the giving up of a UK veto in a significant area of policy because that would mean that the UK would lose the ability to block a future measure made under that treaty article. There is a large number of vetoes in the treaties, and many of them are in areas that hon. Members on both sides of the House consider important and sensitive—for example, foreign policy, tax, justice and home affairs. It is right that any treaty change that would transfer from unanimity to qualified majority voting the way in which decisions were taken over those key areas of policy should require the consent of the British people before a Government agree to such a change.

We do not propose to hold a referendum over the giving up of the veto over more minor or technical measures such as any future agreement to change the numbers of Advocates-General in the Court of Justice of the European Union. In my view, giving up such a veto would be a mistake and should require primary legislation in the House, but I do not think that the British public would understand it if such a narrow and relatively minor measure were to require a national referendum.

[Mr Denis MacShane (Rotherham) (Lab)]

If the right hon. Gentleman has the power of veto, he can stop anything that he does not like. Why does he then need a referendum?

[Mr Hague]

We need a clear framework for referendums because Governments such as the right hon. Gentleman’s promised the people a referendum and then reneged on that commitment, and because the level of public trust has dramatically declined. This is a new framework of law for this country and I believe that it will enjoy growing support over the years. It already enjoys the strong support of two political parties in this country. That in itself is an enormous advance on where we were starting from in the last Parliament, as the right hon. Gentleman well knows.

[Charlie Elphicke]

Does my right hon. Friend agree that the central point of the Bill is that if a future Government came along and attempted to cheat the British people out of a referendum, as the previous Government did—as the hon. Member for Rhondda (Chris Bryant) well knows—they would not be able to do it without explicitly repealing and amending the Act? They could not hide behind word games and semantics.

[Mr Hague]

My hon. Friend is absolutely right. Of course, the Labour party will be asked before future general elections what its approach would be. It will be asked to give the commitment to maintain the referendum lock; otherwise people will know that it would propose in office to do exactly what it has done before—give away the rights and powers of the British people without the consent of the British people. If the Labour party wants to go into a general election on that basis, let it do so, but it would be wiser for it to adopt this framework for the future.

[Mark Hendrick (Preston) (Lab/Co-op)]

rose—

[Graham Stringer (Blackley and Broughton) (Lab)]

rose—

[Mr Hague]

I will give way, but I want to make some more progress and get through my speech, as well as taking interventions.

The second way in which power will be transferred from Britain to Brussels, as defined for the purposes of the Bill, will be by granting an EU institution or body, through treaty change, a new ability to impose further obligations or sanctions on the United Kingdom or on individuals and organisations within the United Kingdom.

That point has been the subject of some debate, although some of that has been based on scant acquaintance with the content of the Bill. It has wrongly been claimed that Ministers will be able to use a significance test on any future treaty change. That is not true. The Bill places an absolute and unqualified referendum requirement on the transfer of competence, the creation of new competence, or the removal of limits to existing competences and upon a whole raft of vetoes. The Bill also provides that the consent of the British people will be required if the Government wish to agree to certain other specific decisions—for example, joining the euro, joining a common European army, or joining the group of countries that have shared border controls.

If the only reason for a proposed treaty amendment being caught by the referendum lock is that it would, while not transferring or extending competence, confer upon the EU the ability to impose new obligations or sanctions on this country, we need to be able to distinguish between important and minor changes. We are providing a workable, sustainable solution to prevent referendums being held on matters that we could not justify to the public as having the significance to merit a referendum.

[Mark Hendrick]

The right hon. Gentleman is making it plain in his remarks that the Bill is not aimed at the current Government; it is aimed at a possible future Labour Government. He says that he would not trust a future Labour Government, but does he trust his current partners? He has described the Liberal Democrats as wanting to go all the way towards a united states of Europe, so what is his position? Does he trust them, or does he trust us?

[Mr Hague]

The Bill is aimed at all Governments, including our own, any future Governments and any combinations of Government. Yes, we have new partners in government and, on the basis of the past seven months, I trust them a great deal more than I would trust the Government we had before the election. Let the hon. Gentleman be absolutely clear about that.

On how the Bill works and ministerial accountability for decisions on whether to hold a referendum, a Minister of the Crown will be required to make a statement within two months of a treaty change being agreed by member state Governments. That ministerial statement will have to give reasons why the treaty change does or does not require a referendum, and those reasons will have to refer to the criteria set out in clause 4.

[Mr Douglas Carswell (Clacton) (Con)]

Will the Foreign Secretary give way?

[Mr Hague]

I will in a moment, yes. Like any ministerial decision, it will be open to any member of the public—yes, any member of the public—who is entitled to vote in a referendum to challenge the Minister’s judgment through judicial review. The reasoned statement set out in clause 5 makes any such ministerial decision as amenable to judicial review as is possible. That provides a powerful reason for Ministers to stick to both the letter and spirit of the law, and not to seek to sidestep the requirement for a referendum. We have ensured that we are as precise as possible about what would require a referendum.

[Mr Cash]

Will the Foreign Secretary give way?

[Mr Hague]

I will give way again in a moment, but I shall give way to my hon. Friend the Member for Clacton (Mr Carswell) next.

We have also provided further clarity on the scope of the referendum lock by setting out certain categories of treaty change that would not require a referendum: first, the accession of a new country to the EU—the hon. Member for Birmingham, Edgbaston looks surprised—would not require a referendum, although each accession treaty would still require approval by an Act of Parliament; secondly, a treaty change that, while it would have to be agreed and ratified by all member states, would not apply to this country; and, thirdly, a treaty change that merely sought to codify EU practice in relation to the previous exercise of an existing competence. The Bill does not cover any use of the EU’s existing competences as defined in the treaties, because those competences have already been transferred and the extent of the competences is set out in European law.

[Mr Carswell]

The Foreign Secretary has spoken of a referendum lock. Given that this Parliament cannot bind the next, that a future referendum would rest on a ministerial decision in the way that he describes, and that a new law would be required for such a referendum to be held, in what sense is it a referendum lock? It is a piece of legislative PR, perhaps, but not really a lock.

[Mr Hague]

My hon. Friend, perhaps deliberately, understates its importance by overstating the scope for ministerial decision and the significance test. The Bill is very clear that, on 44 specific treaty articles, the removal of the veto requires a referendum, and that the substantive use of 12 treaty articles requires a referendum. There is no scope for Ministers to decide that those things do not require a referendum. There is no scope for Ministers to decide that a decision to join the euro, to subscribe to a European army, to give up our veto on the financial framework, to give up our veto on foreign policy or to give up control of our borders does not require a referendum. Let us be absolutely clear about that.

My hon. Friend said that we cannot bind our successors in this respect, but of course that could be said about so many of the laws that we propose, and are proposed under future Governments, which we intend to have long-term effect. If we took that attitude on everything, there would be no point in doing anything or ever getting up in the morning to come to Parliament at all. We are trying to create a long-term and enduring framework, and I believe that we have a very good chance of doing so.

[Graham Stringer]

When the right hon. Gentleman was in opposition, I enjoyed his speeches on Europe: they were magnificent; leonine. I voted with him on the Lisbon treaty—not just on the basis of his speech, but because it was in our manifesto to vote for the Lisbon treaty. However, I wish that he was using now the arguments that he used then. The public are not interested in the details in this Bill—they think that too much money is spent on the European Union and that it has too much power. Are not the Conservative party and the Foreign Secretary going to give the people of this country an opportunity to have their say on that?

[Mr Hague]

The public are right, and my arguments are the same as they were on the Lisbon treaty—[Interruption.] They may not sound like it; I have to explain an 18-clause Bill, so they may not sound quite as dramatic. The hon. Gentleman may be right that the public are not interested in the details of the Bill, but Parliament needs to go through those details. My argument is exactly the same as the one that I made on the Lisbon treaty—that where a Government propose to hand over the powers of this country, there should be a referendum. There should have been a referendum on the Lisbon treaty. If there is any future treaty change of the kind that I have described, there should be a referendum. It is exactly the same argument. I am grateful to him for voting with me then, and I trust that on the same basis he will be voting with me today.

I will now give way to someone else—

[David Miliband (South Shields) (Lab)]

rose—

[Mr Hague]

Since the right hon. Gentleman has reappeared in the House, I will give way to him.

[David Miliband]

I, too, very much enjoyed the right hon. Gentleman’s speeches when he spoke for the Opposition, and it is nice to be able to ask him some questions now.

Schedule 1 of the Bill is entitled,

“Treaty provisions where amendment removing a need for unanimity, consensus or common accord would attract referendum”,

and it lists things such as the appointment of judges and advocates-general of the European Court of Justice. Is the right hon. Gentleman really saying that we are going to have a referendum in this country if his Government, or any future Government, decide that they want to transfer competence on that issue?

[Mr Hague]

We welcome the right hon. Gentleman back to the House. It is traditional in these circumstances to sit on the Front Bench below the Gangway in a menacing posture towards his own party, and we notice that he has gone to sit in that particular position. There is some political significance in that.

I thank the right hon. Gentleman for stressing the detail into which the Bill goes and the extent to which we are insisting that a referendum should be held, because that should be of enormous reassurance to some of my hon. Friends. On the specific subject of the advocates-general, one of the matters that I said would not be subject to a referendum is the loss of our veto on the number of advocates-general.

[Mr Cash]

rose—

[Mr Hague]

That will no doubt have been of some reassurance to my hon. Friend, to whom I give way.

[Mr Cash]

I am extremely grateful again to my right hon. Friend. Does he recall that in the evidence that was given to my Committee and in the conclusions of the report that it produced last night, there was an assertion and a conclusion that the Bill invites litigation in the courts? He has just confirmed, with regard to the circumstances of a referendum, that he too would invite litigation. Does he not think that the time has come when this House, as the ultimate authority of the law of this land, should decide such matters, and not just buck them over to the courts?

[Mr Hague]

The Bill is about many matters being decided in this place or by the people. The hon. Gentleman’s point is distinct from the one that was raised in the European Scrutiny Committee report about clause 18. I made the point that an executive ministerial decision is subject to judicial review, which is always the case. The decision of the right hon. Member for South Shields (David Miliband) on the Lisbon treaty was taken to judicial review by Mr Stuart Wheeler, albeit unsuccessfully. Ministerial decisions are subject to judicial review and that is not changed by the Bill.

The right hon. Member for South Shields is still looking puzzled about the position of the advocates-general. The loss of the veto in the appointment of advocates-general and European Commissioners would be a significant loss of national—

[David Miliband]

indicated dissent.

[Mr Hague]

The right hon. Gentleman may roll his eyes about that, but it would be an important loss of national power. I thank him for illustrating the comprehensive nature of the Bill. I will give way one more time before I resume my argument.

[Ms Gisela Stuart]

Accession treaties are exempt from the referendum requirement. Will the Foreign Secretary explain how the accession of Turkey, which by that stage would probably have a larger population than Germany, would not amount to a considerable loss of influence for the United Kingdom, given the system of qualified majority voting? Why is it therefore exempt from a referendum? I just do not get it.

[Mr Hague]

That is a different argument about referendums on accession treaties. Such treaties do not extend the powers and competences of the European Union, and so are not within the terms of the Bill. If the hon. Lady wants to advocate a referendum on the accession of Turkey, there will, sadly, be time for her to do so because the process will take a while. However, that is a separate argument from the extension of powers and competences.

[Mr Andrew Turner (Isle of Wight) (Con)]

rose—

[Mr Hague]

No, I must make a bit of progress.

The Bill will give Parliament more control over whether the Government can agree to a number of other important EU decisions, sometimes referred to as the self-amending provisions of the Lisbon treaty. Those decisions, which are known as passerelles or ratchet clauses, contain built-in mechanisms that allow modifications to EU treaties or the exercise of one-way options, without recourse to either of the formal methods of treaty change.

The Government have identified three types of ratchet clause, although I hesitate to go into detail after the comments of the hon. Member for Blackley and Broughton (Graham Stringer). However, it is important to be clear on this matter. There are clauses that allow for a change of legislative procedure, clauses that allow for changes in voting procedure and clauses that allow for the expansion of the scope of an article allowing the European Union to act.

Given the lack of a universal definition and the Government’s aim of ensuring that our proposals are as clear as possible to Parliament and the public, we have set out explicitly which treaty articles require additional levels of control. As with future treaty changes, passerelles or ratchet clauses that entail a transfer of power or competence will require the consent of the British people in a referendum. There will be a referendum requirement on any methods in the treaties for giving up vetoes that we have deemed to be significant. Clause 6 covers the simplified revision procedure and six provisions in the treaties that allow for vetoes to be given up without formal treaty change.

Clauses 8 and 9 provide for parliamentary controls over two types of decision: the use of article 352 of the treaty on the functioning of the EU—the so-called broad enabling clause—and the use of three ratchet clauses in the field of justice and home affairs. Some additional proposals that require a vote in both Houses, rather than a Bill, are listed in clause 10. They are mostly articles that modify the composition, rules of procedure or statutes of existing EU institutions or bodies.

The coalition stated in its programme for government that it would examine the case for a United Kingdom sovereignty Bill. I announced in October that, following that examination, we had decided to include a provision in this Bill to place on a statutory footing the existing common law principle of parliamentary sovereignty. The doctrine that EU law has effect here for one reason only, namely that authority has been conferred upon it by Acts of Parliament and subsists only for as long as Parliament so decides, has been upheld consistently by the courts. However, we can see considerable merit in placing that position beyond speculation on a statutory footing. That will guard against any risk that in future, common law jurisprudence might drift towards accepting a different argument. In other words, we have included a clause that underlines the fact that what a sovereign Parliament can do, a sovereign Parliament can undo.

[Mr Cash]

rose—

[Mr Hague]

I give way to my hon. Friend for the last time.

[Mr Cash]

I wish to put on record the fact that, in the conclusions to the European Scrutiny Committee’s report issued last night, we unequivocally rejected the notion of a common law principle, because it would offer the courts a gateway to take over jurisdiction in areas that we regard as unacceptable in UK constitutional law.

[Mr Hague]

Yes, I have read the report, of course, and I note the concerns about the references to the common law in the explanatory notes. However, those references are meant simply as a contradistinction to statute, given that the principle of parliamentary sovereignty is defined nowhere in statute. They are not meant to be determinative of the origin of the principle, which is an issue that goes far beyond the scope of the Bill.

As I set out a few moments ago, under current law any proposal to amend the EU treaties using the ordinary revision procedure can be ratified by the United Kingdom only once parliamentary approval has been obtained by Act of Parliament. We have therefore made provision in the Bill for Parliament’s approval of the transitional protocol on MEPs. That will allow 18 MEPs from 12 member states, including one from the UK, to take up their seats without having to wait until the next scheduled elections in 2014. As that protocol does not transfer any power or competence from the UK to the EU, a referendum is clearly not required. As it is a treaty change, however, all member states are required to ratify it. The Bill also makes the necessary provisions to elect our new MEP, who will, based on the recommendation made by the Electoral Commission in its report last month, represent the West Midlands.

[Chris Bryant]

Will the Foreign Secretary give way?

[Mr Hague]

I think I should try to conclude my speech and give others a chance, but on that point, I give way one last time.

[Chris Bryant]

Is the Foreign Secretary satisfied that the process that the French and Italians are using to change their representation is sufficiently democratic?

[Mr Hague]

I am satisfied that it does not affect the rights or powers of the United Kingdom and therefore does not require a referendum in this country.

The Bill will give the British people and Parliament powers that they have not previously enjoyed in decisions about engagement with the European Union. Some have criticised the Government’s proposals, saying that they will necessarily stymie further progress or put the UK in the slow lane of Europe. The Government do not subscribe to that argument, for three reasons.

First, it is wrong to accept continuous political integration as a definition of progress. Secondly, although other European nations have different constitutional frameworks, a number of countries require a referendum of their people to be held if a treaty change proposes a further shift of powers to Brussels. Some, most notably Germany, also have provisions in place to ensure effective parliamentary control over specific key decisions taken by their Governments. There is a growing trend across Europe to give citizens and Parliaments more control over the decisions taken by their Governments on EU matters, and it is right that we should be not just part of that trend but leading it from the front.

Thirdly, if a future Government can demonstrate a compelling case as to why a further transfer of power is in the national interest, they should be able to persuade the British people of its merits. If a future Government were to take a different view from ours, they would have to convince the British people. Whatever the outcome of such an argument, our democracy would be all the healthier for the decision lying in the hands of the British people as a whole. That fulfils an important part of the Conservative manifesto, but it also draws on a line of thinking that has found its place in recent Liberal Democrat manifestos. I hope that Opposition Front Benchers will in time support it too, because when the voters cast a party out of government, it must understand why. The previous Government’s high-handedness on EU matters is one reason why Labour is no longer in government, and it should now learn from that.

The Bill can receive support from those who like the EU just as it is, those who want it to do less, and those who want it to have more power but who are prepared to argue for that. The Bill does not determine the shape of our future place in the EU, but it ensures that our position will command the voters’ consent. It will give the British people the assurance, which they are entitled to expect, that the sovereignty of Parliament and the ultimate right of the people themselves to decide which powers are the subject of collective decisions within Europe are both properly safeguarded. Those safeguards will put our participation in the EU on a sturdier and more democratic footing. That is why we present the Bill to the House.

17:36

[Yvette Cooper (Normanton, Pontefract and Castleford) (Lab)]

I beg to move an amendment, to leave out from “That” to the end of the Question and add:

“this House declines to give a second reading to the European Union Bill on the grounds that, while the principle of referendums on significant constitutional and monetary changes is appropriate, the Bill is a flawed measure which would confuse the important issues at stake and make vital constitutional issues justiciable by the courts rather than resolved under the sovereignty of Parliament.”

The Foreign Secretary has been on a long and tortuous journey to get here today. The man who voted for the Maastricht treaty without a referendum and the former party leader who put Euroscepticism at the heart of his unsuccessful election campaign now finds himself in government with what he has described as

“the most fanatically federalist party in Britain.”

The Foreign Secretary’s diary engagement from last night rather sums things up for him, and I am sorry that he chose not to share it with the House. Last night, he went back to Smith square, to the old Conservative central office. From the windows where once Margaret Thatcher waved on election night now waves a blue flag with yellow stars. Where once sat Tory party researchers working on the Bruges speech, there are now French, German and Italian officials. He was invited for the opening and renaming of central office as Europe House. It cannot be easy for him. He is caught between the realities and the responsibilities of government and the rhetoric of Eurosceptic opposition. He is caught, as they say, between a rock and the hon. Member for Stone (Mr Cash).

[Mr Hague]

The record should also show that the room where I spoke last night was named the Churchill room by common agreement, and that I took the opportunity to remind all who were there of the need for EU institutions to bring down their budgetary aspirations just as the Government have had to do in this country.

[Yvette Cooper]

If only the Foreign Secretary’s willingness to open EU buildings extended to opening a proper debate on European issues in the House. Clause 10 purports to increase Parliament’s role before ministerial decisions are made, yet the truth is that the Government do the opposite. We have had no discussion of the European economy prior to the discussion between European Finance Ministers today, no discussion of practical measures to cut the European budget, such as reform of the common agricultural policy, and no discussion of working with Europe on human trafficking or the directive that the Government continue to opt out of.

This very morning, European Finance Ministers met to discuss the Irish support package and the European economy. In 10 days’ time, decisions will be made on the crisis resolution measures that will affect the entire European economy—not just the eurozone—for many years to come. National leaders will discuss a treaty change to introduce that package, yet when is the debate in the British Parliament? We have no idea what British Government Ministers are proposing or asking for.

We should hold pre-Council debates in this Chamber. The economic and political pressures that Europe faces are serious. European growth is slowing, unemployment has increased and markets are putting pressure on several eurozone countries, all of which matters immensely to Britain, yet we have had no pre-Council debates. At the end of this year, there will have been four European Councils, but no debate.

[Mr Redwood]

The right hon. Lady is raising crucial issues. Does her party support the idea of Britain being part of more EU economic governance powers to help euroland, and does she think we ought to offer more financial assistance to other euroland countries in crisis?

[Yvette Cooper]

I think that the Government were right to provide support for Ireland, because the prospects for growth in Ireland will have a huge impact on our economy. That is also why it is important that the House debates the precise measures proposed as part of a permanent crisis resolution mechanism. The House does not know what those proposals are or what the Government are arguing for.

[Mr Ellwood]

Will the right hon. Lady provide some clarification, because her amendment does not make it clear where the Labour party stands on this issue? It supports referendums in principle, but it does not say when they would be held. When would a referendum be used on Europe? Will she also clarify whether it is still Labour’s long-term ambition to introduce the euro and an EU defence force?

[Yvette Cooper]

As the hon. Gentleman will know, we have set out our belief that there should be referendums in cases of major constitutional change or currency issues, and I hope that he supported our decision not to let Britain enter the euro for the very good economic reasons that have proved to be right in practice.

The economic issues are very serious. Markets are still putting pressure on several eurozone countries. This matters immensely for Britain, because the Government are relying on an increase in British exports of £100 billion over the next few years to keep our economy growing, and we will not get that if our largest export market has gone into reverse. The EU does not have a serious strategy for growth and jobs, just as the British Government do not. The eurozone does not yet have a strong enough response to the pressure from financial markets, and a strategy of nothing but co-ordinated fiscal austerity in every country in Europe will not deliver growth, will not ultimately satisfy the financial markets and will be bad news for Britain. That is what we should be discussing now; that is what Ministers should be debating in Europe; that is what we should be discussing as part of a pre-European Council debate in the House. It makes a complete mockery of the Bill not to have those discussions in the House, and exposes the sham of the Secretary of State’s approach to Europe.

[Charlie Elphicke]

The right hon. Lady has set out the many problems of euroland, so why has she committed her party to supporting further bail-outs there?

[Yvette Cooper]

The hon. Gentleman needs to recognise that Britain will not grow without sufficient growth in our exports, especially given the sheer scale of the cuts that his Government are introducing. Without a sufficient increase in domestic demand, we are reliant on increasing our exports. Where does he want those exports to go, if he also wants us to turn our backs on Europe and allow the Irish economy to face serious problems? That would put a drag on our own economy and prospects as well.

[Ms Gisela Stuart]

Will my right hon. Friend confirm that the use of article 352 of the treaty on the functioning of the European Union will not require an Act of Parliament, and that the current bail-out of Ireland, which is a pretty significant activity to which we are contributing as part of our EU obligations, is being done under that article?

[Yvette Cooper]

My hon. Friend makes an important point. It raises some of the unresolved questions coming out of the Bill and the interaction between the Bill and some of the crisis resolution mechanisms and proposed treaty changes. The Government simply have not answered those questions.

[Mr MacShane]

I am astonished that the Foreign Secretary of all people has thrown away this pre-European Council debate. I made my maiden speech in such a debate before people such as Ted Heath and Peter Shore. They are very important debates for our House of Commons, but the Government have thrown them in the dustbin because they cannot face the discussions needed. My right hon. Friend is right to keep emphasising this point, so will she commit us, when we form the next Government, to allowing a debate in Government time on Europe?

[Yvette Cooper]

My right hon. Friend is right: those debates are important. We could have had a pre-European Council discussion today, at the same time as European Finance Ministers are meeting and well in advance of national leaders meeting to discuss exactly these issues. Instead of talking about vital issues for the European economy, what are we doing? According to the Foreign Secretary, we are talking about referendums that he says we will not need and sovereignty that he says we already have—that is, referendums for powers that he says he will not even transfer, and sovereignty that he says will not change at all as a result of this Bill. Unnerving as I find it to be in agreement with the hon. Member for Clacton (Mr Carswell), I am afraid to say that he is right. This Bill is just smoke and mirrors to distract us from the fact that the Government have no strategy for Europe and no way of handling their own Eurosceptics.

Instead of having a serious debate about the future of Europe, the Foreign Secretary is pandering to the Eurosceptics, and it is the worst pandering of all, because it will not even work. All that it is doing is winding them up. This Bill is a complete dog’s dinner and he knows it, yet the Eurosceptics are salivating nevertheless. The Bill tries to constrain parliamentary sovereignty on the one hand and protect parliamentary sovereignty on the other, using a referendum lock that does one thing and a sovereignty clause that does the opposite—a referendum lock that tries to bind future Parliaments and a sovereignty clause that makes it clear that the Government can do no such thing. It is all in the same Bill, which faces both ways at the same time.

The Government’s press release on the sovereignty clause says:

“The common law is already clear on this. Parliament is sovereign. EU law has effect in the UK because—and solely because—Parliament wills that it should. Parliament chose to pass the European Communities Act 1972. That was the act of a sovereign Parliament.”

There is not much room for misunderstanding there. The statement then proclaims that

“to put the matter beyond speculation,”

the Government will introduce the sovereignty clause, but whose speculation are we talking about? It is not the speculation of the hon. Member for Stone (Mr Cash), because his European Scrutiny Committee has said:

“The evidence we received suggests that the legislative supremacy of Parliament is not currently under threat from EU law.”

The Committee continued:

“Clause 18 is not a sovereignty clause in the manner claimed by the Government, and the whole premise on which it has been included in the Bill is, in our view, exaggerated.”

The only source of speculation that I could find was one speech by a barrister on behalf of a client in 2002 and a speech by the Prime Minister in 2009. The truth is that the Foreign Secretary has set up a straw man in order to shoot it down, because he will not give his party what it really wants, which is a referendum on withdrawing from the EU altogether.

[Mr Jenkin]

The right hon. Lady really does not know what she is talking about. Let me refer her to the Law Lords’ judgment in the case of Jackson v. Attorney-General, in which Lord Steyn said:

“The judges created this principle”—

that is, the principle of parliamentary sovereignty.

“If that is so, it is not unthinkable that circumstances could arise where the courts may have to qualify a principle established on a different hypothesis of constitutionalism.”

Lord Hope said:

“Parliamentary sovereignty is no longer, if it ever was, absolute…Step by step, gradually but surely, the English principle of the absolute legislative sovereignty of Parliament which Dicey derived from Coke and Blackstone is being qualified.”

There are therefore two Law Lords speculating about the future of parliamentary sovereignty. The right hon. Lady had better do some homework.

[Yvette Cooper]

I am afraid that the hon. Gentleman is not picking a fight with me; he is picking a fight with his Government, whom I quoted, and the European Scrutiny Committee, which I quoted. His disagreement is with them, but I hope that he agrees that clause 18 does nothing at all to change sovereignty. In fact, the hon. Member for Crawley (Henry Smith), who asked about a written constitution, got further than anybody else in raising the key question about sovereignty that the hon. Gentleman’s Government are pretending to solve while, in fact, doing nothing of the sort.

[Mr Cash]

I simply make the point that our Committee report is utterly clear on that subject. What the right hon. Lady quoted is correct. However, her Government were as responsible as any for giving more and more judicial authority—ultimate authority—to the courts. Their main policy over many years could be characterised as handing over more and more powers to the judges at the expense of this House.

[Yvette Cooper]

I know that the hon. Gentleman has immense expertise on the details of the legal changes, but he and I have a long history of disagreeing over what is important in a particular case, and I suspect that we will continue to do so.

[Chris Bryant]

Is not one of the problems with the Bill the fact that it makes the decision on whether to hold a referendum justiciable, and therefore a matter to be decided by the courts, when it is surely a political decision for which elected Members of Parliament ought to take the rap at the ballot box if they get it wrong?

[Yvette Cooper]

My hon. Friend makes an important point. The Bill will create a lawyers’ paradise because it is so confused and complex. Important issues will have to be decided by the courts as they try to interpret what the Government and Parliament meant, which could lead to decisions that override Parliament and delays to decisions that Parliament might want to make while those legal wrangles are taking place.

[Charlie Elphicke]

Speaking as a former lawyer, I find the Bill plain and obvious. If a future Government or bunch of politicians get together to cheat people out of a referendum, a little guy could come along and put a stop to that through the court system. That has to be right, in order to keep politicians to their promises.

[Yvette Cooper]

That little guy would have some serious questions about which cases could be taken to court, how long they would take to be dealt with, and what judgment the court would make.

The pledges on referendums are very confused. We agree that Europe should not be pursuing new treaties, major treaty changes or major transfers of power or competence, and we have long said that it is time for Europe to stop its institutional navel-gazing, but navel-gazing is exactly what the Bill proposes. It tries to pin down in legislation the detail of a whole series of changes that would, or would not, trigger a referendum, but it creates complete confusion as a result. It does not define the powers or competences that it wants to protect, and it does not explain what constitutes a significant change and what does not. It allows Ministers to make decisions in certain areas, but admits that that will be subject to judicial review.

As far as I could understand him, the Foreign Secretary said today that the extension of any competence—even a supporting one, and even in a very small or insignificant way—will require a referendum. However, new powers to impose requirements, obligations or sanctions on the UK, even if they would have far more impact on Britain than a small change to the competences, would not require a referendum if Ministers determined that the proposed changes failed their own significance test.

I am also completely baffled by the debate about the advocates-general, because schedule 1 clearly states that the matter would attract a referendum, but the Foreign Secretary said that it would not pass the significance test. As far as I could work out, as I fitted together what he was saying, we would not have a referendum on how many advocates-general there were to be, but we would have to have one on whom we were going to appoint.

This is a dog’s dinner of a Bill. It is completely confused. Frankly, it makes the Maastricht treaty look like light reading. The Minister for Europe has said that he does not believe a referendum should be triggered for a treaty change on the allocation of carbon credits. He says that that is not significant, and he has a point. That matter should not merit a referendum, but how can he be sure that the courts will take the same view when interpreting this legislation? What about the treaty change that is due to be proposed at the European Council next week? That change would make it possible for Europe to create permanent bail-out mechanisms to deal with future financial crises in the eurozone. We have said that we have some concerns about the overall policy approach that Europe is taking. Nevertheless, the Government have said that they support these changes, and we recognise the need to look at a treaty change in order to ensure that a permanent long-term response is in place. The Foreign Secretary seems to be hoping that this treaty change will not be covered by the Bill, but how can he be sure that the courts will take the same view? He is asking for trouble because the Bill is so contrived and complex. Lawyers will have a field day. He is contriving his Bill to avoid a treaty change that he has not yet negotiated, and contriving his treaty negotiations to avoid clashing with a Bill that he has not yet tested in Parliament or in the courts.

Furthermore, despite all the Foreign Secretary’s contortions, he will not keep his Eurosceptic party happy anyway, as we have heard in interventions today. His Government have signed up to the EU investigation order. They were right to do so, and we welcomed the move, but his Back Benchers wanted a referendum on the matter. His Government supported the Van Rompuy taskforce on economic information, but many of his Back Benchers wanted a referendum on it. They want referendums on crime, on justice co-operation on the European arrest warrant, and on pulling out altogether. He cannot keep his Eurosceptics happy, so he is desperately trying to distract them with this Bill. He promised them red meat, but he is now offering them an omelette instead.

This is a Government of chaos and confusion, with the Eurosceptics on one side and, on the other, the president of the European Movement and the Energy Secretary, who has said about Europe that the

“Tories have jumped into bed with the wackos and the weirdos”.

On this evidence, one could say the same of the Liberal Democrats. The Government can have unity without clarity, or clarity without unity, but they are clearly incapable of both. At a time when they should be working hard in Europe on the issues that matter—jobs, growth, trade, cross-border crime—they are collapsing back into navel-gazing and confusion and turning their backs on the opportunities and benefits that working in partnership can bring. This Bill is a mess, and they should go back to the drawing board and start again.

[Several hon. Members]

rose—

[Mr Deputy Speaker (Mr Nigel Evans)]

Order. Many Back Benchers wish to contribute to the debate, and a 10-minute limit on speeches has been introduced.

17:56

[Mr John Redwood (Wokingham) (Con)]

This Bill is born of a very serious mood in our country. A majority of people in Britain feel that a great amount of power has already passed to the European Union over the past 20 years, and they feel that powers are still drifting away under this new Government. They would like to see that progress arrested, and they would like to see powers brought back in certain crucial areas. They would like to feel that more of their lives were under democratic, accountable government here in Westminster than under the less accountable, less democratic government of the European Union. The Government would be wise to heed the seriousness of that view among many in this Parliament, representing many outside it.

I welcome the Foreign Secretary’s noble aim. He says that the aim of his legislation and policy is to give us all a greater sense of empowerment when it comes to matters of European governance and action. I would urge him to look again at his Bill, however. It is certainly cleverly contrived, and it is certainly contrived in a great deal of detail, but it is, in practice, the not-the-referendum Bill. On every area of competence and power that we see drifting away or being transferred from us as we have this debate, we are told, “That would not qualify for a referendum under this legislation.”

I believe that the Foreign Secretary has taken legal advice, and he wants to have a referendum on the transfer of competences rather than on the transfer of powers. I would suggest that that is a tad too clever. We all know that most of the competences have already gone. That was what Lisbon was all about. That was why he and I fought tooth and nail, together, against that treaty and in favour of a referendum on the treaty. Most of the things that the Government now wish to do are a shared competence with the European Union. What matters is not a further transfer of competence, but a further grab or transfer of power by the European authorities.

When the Conservatives were in office, we made it very clear that we wanted trading relationships and friendships, and a certain amount of common legislating in single market and related areas, but not a common Government or political union. To reflect that, the architecture that we persuaded the partners to accept had the third pillar areas of foreign affairs and home affairs, which were matters for independent sovereign states to decide, and we always preserved the veto on any common action. That has now been eroded. So, as we meet to debate the so-called referendum lock, we see powers on home affairs being surrendered, issue by issue, by this Government—as they were by the previous Government—which will result in a much more common criminal jurisdiction from the European level. The British people need a voice on that matter; they need to be asked about it. Some of them might even agree with it, but they want to be treated seriously, as grown-ups, and asked if that is how they want their country to be run in the future.

On foreign affairs, we are being told as we meet that we still have a veto on the big issues and that my right hon. Friend the Foreign Secretary can play his part in shaping a common European action and diplomatic strategy. At the very same time as we have to cut severely the growth rate of our public spending and make some deep cuts in certain areas, which we do not like, we see the European budget going up rapidly, partly to finance a big expansion in the European diplomatic service. This is not being done in order to have holidays in the sun, as some national newspapers seem to suggest, but because the EU wishes to exercise power and authority on our behalf and on behalf of other member states.

[Mr Jenkin]

I do not think that the Foreign Office has fully understood the consequences of encouraging this to go ahead, which is what it did. I am afraid that a great many of us voted for it in this House. The European External Action Service is ordering much more expensive cars, is to have grander embassies and is to pay much higher salaries than our own diplomatic service. That will be to the detriment of our diplomatic service because it will attract the talent away from our service and towards the European External Action Service.

[Mr Redwood]

It means that when a British Foreign Secretary makes foreign visits, he or she will be kept waiting while the EU ambassador is received and considered, because the latter will speak with more authority on behalf of more people and more states.

It is the third area that we have always reserved for national veto and national competence—central economic policy making—to which I shall address the remainder of my brief remarks in this truncated debate. Literally as we meet here this afternoon, crucial and massive issues are being hammered out in secret around the Council table in Brussels. Quite likely to be on the agenda is the issue of European sovereign bonds and the effective creation of a European sovereign in financial matters that issues debt and guarantees debt on behalf of member states. Do we want that? Are we in it? Is it not a transfer of power if we go along with it? Is it not an issue on which we should be invited to express our views?

Another item on the agenda may be the future membership of the euro. The Council could be considering in secret whether all member states are able to stay in the euro and whether the strong or the weak members should leave. If they are to keep the euro area together, what will be the arrangements for the large transfer payments that need to be made if the single currency is to have some hope of a decent life in the future, as all successful single currency areas have much bigger transfers of tax revenues, subsidies and money around them than the euro area currently has?

[Mr Cash]

My right hon. Friend portrays so accurately the realities that lie behind this Bill, which is about the economic crisis in Europe as well as many other matters. Does he agree that one serious current problem is the financial stability mechanisms and that if we do not assert our rights in this House and make certain that the courts cannot get their hands on an interpretation that would go the other way, we could end up paying for other countries beyond Ireland—Portugal, Spain and others?

[Mr Redwood]

My hon. Friend is absolutely right, which is why the transfer of power, if not of competence, is such a crucial issue and why we need to engage in a public debate at this very moment about how far this should go.

I hasten to stress to the House—particularly to my critics, who like to misconstrue what I say—that I wish our partners every success and prosperity with their single currency. I know that if that is the way they choose to run their economies, it is in our interests for it to work. We want them to be happier and more prosperous, and we like to benefit from trading with them, just as they like selling us a lot of their products. My worry is that in the process of our enthusiasm for that, we will draw in Britain—with her rather stretched budgets, even after the changes that the Government have rightly and wisely made—at a time when we do not have the financial strength to go to the aid of all these other euroland countries that are in some difficulty under the euro scheme.

I am a critic of the Irish loan. Of course I do not want to see the Irish economy go down, but I do not happen to think that lending the country lots of money at that juncture, as a result of a crisis deliberately created by the European Central Bank, was a terribly good way to behave. I do not believe that if Britain had declined to make some money available, the Irish loan would not have been negotiated. It would have been negotiated quite successfully by the architects of it—the powers behind the European Central Bank, who literally decided to withdraw funds from the Irish banks at a difficult time and made that decision public, thereby precipitating the crisis. We were engaged in a refinancing package for the European Central Bank. I think we should be told the truth; we should be told why it was a good idea for a country that rightly stayed out of the euro because it did not want the financial risk and hassle, to be drawn into helping finance the consequences of an ill-judged currency without a political union.

A successful currency needs a sovereign to love it and support it. That is why the sovereign’s face traditionally appears on the coinage and why there has to be a symbol to show that the whole weight of legal and economic authority stands behind a currency. If Europe is to have a successful euro, she needs a sovereign. I do not want my country to be part of the euro, and I think that around 80% of the British people agree with me. I think that even Opposition Members temporarily agree with me on this issue; they are not rushing to say that now is a good time to join the euro. We should be open and honest with the British people and say, “We wish the euro well.” We are doing it a great favour by not trying to join it—we would have been an over-mighty subject in it, which might even had led to its toppling earlier—and we are not currently in a financial position to make all the transfer payments available that are necessary for full members of a single currency area.

The House needs to understand that while we are debating some abstruse language and pledging this and future Governments to hold a referendum on treaties unknown about competences unspecified, a potentially massive transfer of power is under way yet again from the member states to the centre. There has to be; the thing cannot work without more central power behind the banks and the economic institutions.

The British Government say that they will accept a treaty extending the centralising powers in the economic sphere because the penalties on these will not apply to the UK Government. Well, I am delighted that the penalties will not apply, but I see no reason why the requirements should apply either, because we are not part of the euro. We should offer our support for a strengthening of economic governance for the euro area alone and make it clear that all the regulations and the directives apply only to that area. I think that my right hon. Friend the Foreign Secretary got it wrong when he said that none of those applies to Britain; several of them do, although without the ultimate penalties. There could be other penalties, incidentally, which might apply to Britain.

When we surrender our veto and allow this treaty to go through on that condition—that it applies only to euroland—we should say that we want something back. We should seek to establish that we believe the European Union already has too much power and that we want something back. Do we want our fisheries back; do we want control over our borders back; do we want control over elements of taxation that have already gone to Europe through common taxation and a series of court judgments?

Power is seeping away as we meet. A massive debate is under way. Will the Government please take this Parliament and the British people into their confidence? Will they take us seriously? Will they give us an adult debate on the reality rather than this show Bill?

18:08

[Kate Hoey (Vauxhall) (Lab)]

I have to say that there is little in the speech of the right hon. Member for Wokingham (Mr Redwood) with which I would disagree. That immediately places me, of course, very much in a minority in my own party. I do not think that either of us is in a minority in the country, however. Many people watching our debate today will be wondering how on earth we ever got here. They will wonder why we are trying to introduce a Bill that is literally tinkering around with the real and fundamental problems of our membership of the European Union.

It is with great regret that I have to say that my party betrayed the promise it had made on the Lisbon treaty. If it had granted the referendum on that treaty, we would not be here discussing this Bill. One reason why my party and others did not want that referendum is that they knew the result would have been a defeat. In other words, we would not have signed up to the Lisbon treaty; it would not have happened.

[Mr Jenkin]

Will the hon. Lady forgive me for pointing out that if we had had the referendum on the Maastricht treaty, it is most unlikely that the European Union would be in the mess that it is in today?

[Kate Hoey]

I was new into Parliament shortly before the Maastricht treaty and I lost my position as the shadow spokesperson on the citizen’s charter and women because I voted against that treaty. I am therefore well aware of the issues. I was obviously in a minority then in my party, even though prior to that we had been quite sceptical on Europe.

I give the coalition Government some credit, because I know that they are facing great difficulties. The Conservatives said fine words before the election about how they were going to get more powers back and not allow any more powers to go. Unfortunately, perhaps because of the coalition, but also because of other pressures, most of that has not been complied with. The Government have therefore come up with this Bill, which seeks to show the country that there is still support within the coalition for getting some powers back. As my right hon. Friend the Member for Normanton, Pontefract and Castleford (Yvette Cooper) has said, the Bill is unfortunately a minefield that lawyers will absolutely love.

The Bill misses the whole point. Some people continue to say that we should not even discuss whether we should leave the European Union, whether we should have that debate in the country and whether we should have a referendum. They have yet to prove to me—I have studied this very carefully—just how having that debate, having that referendum and voting to leave the European Union would be a disaster for this country. No cost-benefit analysis has ever been carried out on that. No Government have undertaken a proper cost-benefit analysis of the benefits to this country of being in the European Union. Although other countries, such as Switzerland, have carried out such analysis, every time it has been suggested here, it has been brushed away by the elite in Europe and in this country, who say that the net gains of membership are so obvious that there is no need even to think of quantifying them. That is increasingly becoming not true and the public are beginning not to believe it.

I am not a reader of the Daily Express, but its campaign, which has shown huge support for a discussion and debate on the European Union, is very much to be welcomed. Recent developments have made all of us who have doubts about this country’s involvement in the European Union queasy, because the United Kingdom’s membership of the EU is incredibly expensive for us and the benefits are becoming increasingly difficult to see. We do not need, again, to go into the cost of our net budget contribution, the increase that is going to take place and how it will be spent. Nobody wants to let the public know just how our money is spent. They are not told about the huge costs of the European External Action Service. From now on, our ambassadors will become less important than this European Union ambassador and it is shocking that we have allowed that to go ahead. I cannot understand why the new Government have done so, apart from the fact that they are a coalition.

However, I still wonder whether a Conservative Government with a proper majority would really have done all the things that they said they would. Once someone goes to Europe and gets involved in it, they somehow start almost to be part of it. They start to make up the discussions and the arguments, and somehow their attitudes change. The Minister for Europe used to say some brilliant things about Europe that I agreed with, but now that he is on the Front Bench, his words have changed slightly and become slightly nuanced. We get the feeling that once people have been going to Brussels over and over again, they change their attitude.

I am concerned that the Bill does not go far enough. I am not going to vote for the Labour amendment, which is a cop-out and a nothing amendment—it does not say anything. It does not bring to people’s attention all the opportunities that we missed when we were in government. I still have not decided whether I will abstain or vote for a Bill that we might be able to amend. I want this Bill to be used as the opportunity for people in the country to start being listened to. I want them to start having the opportunity to engage in the debate about why they feel so strongly that our membership is not giving us anything that is worth the money that we pay in.

[Charlie Elphicke]

Although many of us, myself included, would like to head into reverse and one day have that wider question determined, does the hon. Lady not accept that it is a positive move that this Bill provides a brake to stop us hurtling further forward without having a say?

[Kate Hoey]

I would accept that, except that even since the new coalition Government took office, this country has given away some more powers and given up things. We are already going to support directives that we should not possibly be supporting. It is the drip-drip-drip nature of the European Union that really gets me.

[Austin Mitchell (Great Grimsby) (Lab)]

Does my hon. Friend agree that this is really closing the stable door after not only the horse has bolted, but the stable has caught fire?

[Kate Hoey]

That is my point, and my hon. Friend is absolutely right. We will never get the issue that is big enough for a Minister to say, “We are going to have a referendum on this.” Ministers will find some excuse not to do so, which is why the only honest thing is to work towards having a debate in the country and a referendum on whether we want to stay in the European Union. We hear all those Members, Ministers and shadow Ministers continually saying, “Ah, but it would be desperate. We could not possibly leave. We couldn’t even think about it.” They should put their arguments to the people. Let the people decide. Let them say what they really think and let us see what that decision would be.

There is one little book that every Member in this House should buy. If the Foreign Secretary, the shadow Foreign Secretary and the shadow Ministers have not read it, I will give them a copy. It is called “Ten Years On: Britain Without The European Union”. I wish it had said “the United Kingdom”, rather than “Britain”, as that would not have left out Northern Ireland. This brilliant book actually says, “If we were to leave the European Union, this is what this country would look like 10 years on.” Let us have the confidence to say to the people that it is time that we have that real debate. Let those people who are confident that the European Union is the right thing for this country put it to the people and give them the say.

18:10

[Tim Farron (Westmorland and Lonsdale) (LD)]

It is a pleasure to follow the hon. Member for Vauxhall (Kate Hoey) and the right hon. Member for Wokingham (Mr Redwood), not only because they made excellent contributions, but because they give me the opportunity to be a loyalist by contrast.

This welcome and important Bill follows last week’s award to the Prime Minister and the Deputy Prime Minister from European Voice for their joint work in advancing a more progressive and European-style of Government—I know that all on the Government Benches will be celebrating that. The Bill is a fine example of a coalition product: it is a sensible compromise. For too long, the UK has allowed domestic political posturing over the European project to dominate its thinking on the EU. Such an approach has fundamentally undermined our ability to play the positive agenda-setting role on the European stage that we can and should do. It would be great to be in the driving seat of Europe, okay to be in the passenger seat and passable to be in the back seat, but for the past 20 years or so Britain has, in effect, locked itself in the boot, kicking and whingeing as if it were somebody else’s fault.

[Mr Douglas Carswell (Clacton) (Con)]

Then get out of it.

[Tim Farron]

That is an honest position at least, which my hon. Friend sets out from a sedentary position. It is vital that we assert our sovereignty in Europe, but it is also vital to understand that one of the reasons why we have seen our sovereignty wane is our pig-headed failure to embrace the EU and take a positive role in shaping its future. It is high time that we moved on from dismal EU constitutional wrangling and focused instead on the issues that really matter.

[Mike Gapes (Ilford South) (Lab/Co-op)]

How does the hon. Gentleman think we can move on from dismal constitutional wrangling if we allow judicial reviews of all such issues?

[Tim Farron]

Every act of legislation creates a possibility of further litigation. That is the nature of what we do. The hon. Gentleman raises an important issue, and if this Bill becomes an Act it will deal with many of the uncertainties and genuine concerns raised by my hon. Friends from a different party about our position in the European Union and the legitimacy of the decisions that are taken. The power should ultimately rest in this place and—even more ultimately—with the British people.

[Mr Redwood]

rose—

[Mr MacShane]

rose—

[Tim Farron]

I had better be fair and give way to my right hon. Friend the Member for Wokingham (Mr Redwood). Then, I think, I will have no more opportunities to give way.

[Mr Redwood]

Will my hon. Friend explain why we had 13 years of a pro-European Government who said we were at the heart of Europe when we were still in the boot?

[Tim Farron]

My right hon. Friend makes a very good point. The reality is that for 13 years we had a Government who said they were pro-Europe but never went on the front foot and defended that position. There are all sorts of reasons to defend our position in the European Union and say that this country’s interests are best placed if we are inside the EU. However, because of the national mood and if we were to have a referendum today on in or out, there is a very good chance that—

[Thomas Docherty (Dunfermline and West Fife) (Lab)]

Will the hon. Gentleman give way?

[Tim Farron]

I do not think I am permitted to take more than two interventions.

There is such Eurosceptic hostility to the European Union that the last Government took the view that to attach themselves to the EU would mean seeing their popularity sink. They should have gone on the front foot; perhaps we would be in a different position if they had.

The UK and other member states face many major challenges, such as delivering economic growth, completing the single market, delivering new free trade agreements, cracking down on cross-border crime, combating climate change and fighting global poverty. The Bill should finally place to rest the concerns about the lack of democratic safeguards over big EU decisions. It will ensure that future big decisions about Britain’s place in Europe are taken out of the hands of the governing elite of the day and placed firmly in the hands of the British public and, on their behalf, this Parliament.

The Bill is a fine example of what coalition politics produces—a document delivered by two parties, working together despite their differing traditional outlooks on the EU.

[Dr Thérèse Coffey (Suffolk Coastal) (Con)]

Will the hon. Gentleman give way?

[Tim Farron]

I will not. I am permitted to take only two interventions without losing time and I want to ensure that I give people a chance to speak.

Despite our differing traditional outlooks on the EU, the coalition has come together, found common ground and drawn a line—obviously—under the European constitutional question once and for all, we hope, by ensuring that the public and Parliament have the final say on the big questions that will determine how UK and EU relations evolve. The Bill should also give the British public a new sense of ownership, enshrined in law, over the future evolution of UK relations with the European Union.

The Liberal Democrats are unashamedly a pro-European party. We fundamentally believe that British national interests are best served by playing an active and leading role in the European Union. We are also fundamentally a democratic party and one that believes in devolving power to the lowest level possible and in reconnecting the public to politics through democratic reform. We recognise that the experience of rapid EU integration over the past two decades, although it has been necessary and ultimately beneficial to the UK, has left many members of the British people feeling sceptical about and disconnected from the decisions made in their name at an EU level, most recently with the Lisbon treaty.

This is why the Bill is so important. Its main purpose is to reconnect the British public with EU-level decisions and to reassert parliamentary controls over those key decisions. The Bill should help to give the British public a new sense of ownership over the UK’s relationship with the EU in the future and it provides the British public with the legal guarantees that they, not the Government or Parliament, will have the ultimate say in future decisions about the UK’s level of involvement in the EU.

Now is the time for the EU to focus on delivering solutions to the huge challenges that face all member states rather than looking inward. The Bill is in keeping with a number of innovations in the Lisbon treaty that seek to provide national Parliaments and European citizens with a greater say over EU decisions and the direction of the European project. I say that as a member of my party who voted with my now coalition colleagues in favour of a referendum on the Lisbon treaty. If we had had a referendum, I would have argued in favour of that treaty.

The UK is not alone in recognising that the pace of EU integration has left a dangerous lack of understanding about the connection between the EU institutions, national Parliaments and their citizens. In fact, that was recognised by all EU member states in the Council, by members of the Commission and by Members of the European Parliament long before the Bill was conceived. Indeed, that concern was translated into concrete measures in the Lisbon treaty. The treaty has gone a long way towards creating new connections and controls between the public and national Parliaments in the EU, which I warmly welcome. It is too early to see how they will work but the direction in which the EU—and now the UK—is moving is clear.

Let me give some examples of Lisbon treaty democratic and parliamentary control innovations. The European citizens’ initiative enables a petition of more than 1 million European citizens from across the member states to trigger a legislative proposal from the Commission and is a unique and groundbreaking innovation expressly designed to develop connections between European citizens and the often seemingly alien EU institutions. The new yellow and orange card system enables one third of national Parliaments, via the scrutiny Committees in the UK, to object to an EU proposal if they feel that it breaches the principle of subsidiarity, requiring the Commission either to reconsider the proposal or to force the Council and the European Parliament to come to a decision whether to scrap the proposal or to amend it. Also, the new emergency brake clauses in the treaty enable any single national Parliament to block a proposal if it considers the proposal in question to breach or contravene a fundamental component of the legal framework, such as criminal justice.

The Bill can in part be seen as a logical extension of the work of the Lisbon treaty in reconnecting the public and Parliament to EU decisions and its institutions, but our sincere hope and intention in supporting the Bill is that it will finally help to restore some sanity and pragmatism to the debate in UK politics about the EU and EU proposals. There is an extremely poor level of debate in the UK about the EU and the Bill should help to improve that. With a more transparent approach to our membership of the EU, some of the clouds of Eurosceptic mythology might begin to lift. For instance, the use of passerelle clauses will trigger Acts of Parliament and that will mean a rare and welcome opportunity to have an informed domestic debate about substantive EU proposals, giving Members of both Houses the chance to discuss the respective pros and cons of a particular EU measure for the UK.

For example, should the Bill become law, one passerelle that would trigger primary legislation would be that on establishing an efficient and fully functioning EU patent system. A proper patent system has been at the top of UK businesses’, innovators’ and scientists’ wish lists for decades and we believe that it is fundamentally in the interests of the UK. We look forward to discussing that groundbreaking proposal in more detail if and when primary legislation is introduced in the near future as a result of the Bill. Such issues will be discussed more often in this House and the voices of reason in this place will be forced to go on the front foot and to sell the benefits of EU membership and integration to the British public.

The Government have chosen to engage positively with Europe and to tackle the largest single block that leads to discontent about the EU among the British public, which is the sense that decisions taken at EU level are remote, unaccountable and beyond our control. Liberal Democrats believe that the UK’s national interests have been and will continue to be served best by our membership of the European Union. The major challenges that face us cannot be solved by UK action alone. They often require international action through the European Union. Our relationship with the EU, however, from the point of view of the media and much of the public, is pretty poisonous. For a sane Government who seek to advance Britain’s best interests, this is a hugely challenging position. Surely the challenge is too big for legislation alone to fix it.

There is a growing fear that unless something radical is done, the views of the British public and the politicians on the EU will continue slowly to drift on a tide of Eurosceptic media stories to a point at which this country will ultimately leave the EU altogether. I know that many of my colleagues on the Government Benches would favour that, but in my view it would be an absolute disaster for the United Kingdom. I would be interested to hear from the Minister what other plans the Government have beyond our Bill, in line with their commitment to play a strong, positive and active role in the EU, to start a new dialogue with the British public calmly and rationally to explain and sell the benefits of EU membership.

There are many questions to answer, but the Bill’s crucial task is to democratise and make transparent and trustworthy all our dealings with the European Union and to do so in a way that is pragmatic and positive for our immensely valuable relationships with our EU partners. For what it is worth, I think the coalition has succeeded in meeting those challenges and I look forward to continuing this formalised outbreak of accountability and reason towards our membership of the European Union.

18:30

[Chris Bryant (Rhondda) (Lab)]

It is a great delight to follow the hon. Member for Westmorland and Lonsdale (Tim Farron), who is a man of great integrity. I am sure that his integrity will see him through all the way to Thursday afternoon. He is absolutely right to say it is essential to British interests that we play a key role in the European Union, but the Bill will do nothing to assuage Euroscepticism; if anything, it is intended to enhance and inflame it. He said that the Bill is a coalition product as though that places some kind of trade mark on it. I look forward to the trade mark being planted on all coalition products, as it would automatically bring them into disrepute with most Conservative Members.

The hon. Gentleman referred to our having locked ourselves in the boot of a car with regard to Europe in recent years. It is very difficult to lock oneself in the boot of a car, but I think the Liberal Democrats feel a little as though they have managed to do that at the moment—or at least that they are being locked in the boot by the Deputy Prime Minister in relation to other Government measures.

I shall let the House into a very small secret: I am slightly pro-European. Indeed, I am almost ludicrously pro-European for the very strong reason that in my lifetime Europe has embraced countries that have lived under dictatorships in Spain, Portugal, Greece and across the whole eastern bloc. In those countries, there was no right to freedom of association or freedom of speech, the death penalty was used ubiquitously and there was political repression. In future, we will all recognise that one of the European Union’s greatest successes is the fact that in all those countries there has been an aspiration for political freedom largely because of the EU’s success.

[Charlie Elphicke]

I thought that the achievements in the countries the hon. Gentleman mentions were those of Margaret Thatcher, Great Britain and the United States.

[Chris Bryant]

I do not think Margaret Thatcher had anything to do with the advance of freedom in Spain, Portugal or Greece. Mrs Thatcher achieved many things—in the Rhondda we are certainly aware of, and resent, many of them—but the hon. Gentleman cannot claim that the advance of freedom was because of her, except that she was pro-European; in that regard, she did do something in the interests of the whole of Europe.

My problem with the Bill is that it does not do what it says on the tin. It is not an effective referendum lock, which was the promise. Two or three hon. Members have already made the point, in questioning the Foreign Secretary, that the House has perfect freedom to amend these measures in future, so if a Minister wanted to advance legislation implementing some change in the relationship between the United Kingdom and the EU, and if they thought it would offend against the measures in this Bill, they would have only to add a clause saying that the measures in this Bill did not apply. Of course they would have to take that change through both Houses, so there is an element of a brake, but the Bill is in no sense a substantial referendum lock.

[Jacob Rees-Mogg (North East Somerset) (Con)]

Is it not true of every piece of legislation that it can be repealed later? There is a political cost in repealing legislation that makes this a lock.

[Chris Bryant]

It is true that every piece of legislation can be repealed or sidestepped, and there may be a political cost in doing so. In a few weeks’ time, when a number of extra peers have been added, the Government will have a majority not only in this House but, uniquely since the second world war, in the other House as well, so there will be a further slowing down. The Bill provides not a lock but a brake—that is all. It does not do what hon. Members want, which is to draw a line regarding all further innovations in the relationship between the UK and the EU.

The Bill will not deal with the real problem. The right hon. Member for Wokingham (Mr Redwood) and my hon. Friend the Member for Vauxhall (Kate Hoey) are right that my views on the EU are those of a minority. I know that partly because my father sends me an e-mail every Sunday to remind me of that fact and also to remind me that he moved to Alderney primarily so that he does not have to abide by any EU laws. He also regurgitates vast quantities of things that I hear regularly from hon. Members. I think it is a great embarrassment to him that I was not only the Minister for Europe but the Labour Minister for Europe.

The problem in Europe with those whom others have referred to as the elite and with ordinary members of the public is that there are real difficulties in advancing the European cause because there is no single European demos or political opinion. The waves of views crash upon the electoral shores in different parts of the EU at different times and it is very rare for two meetings in a row of the General Affairs and External Relations Council to include the same set of Ministers. Consequently, it is a phenomenal triumph to achieve any European co-ordination.

Some of the EU’s founding principles—indeed, the economic ones—are very powerful, such as the right to freedom of movement and to work anywhere in the EU. In the UK, Labour brought in civil partnerships—I have benefited from those changes this year—and other EU countries have introduced other ways of recognising same-sex unions. Many of us believe there ought to be a system for recognising those unions in every other country in Europe; otherwise there will clearly be discrimination against people whose partnership cannot be recognised for the purposes of taxation, benefits and the right to freedom of movement around the EU. I do not want Europe to decide the law on marriage in any European country, but I do want it to be able to enforce the basic principle of freedom of movement, and that will require a shift so that civil partnerships in this country, or same-sex marriages in Spain, can be recognised in every other country. Otherwise, married same-sex Spanish couples who move to France will have to divorce and form a new civil partnership there. The seeds that have been sown in the underlying principles of the EU will not go away. The British people who live in Spain and demand that Europe should act on property rights in Spain are arguing for an extension of the EU’s powers although many of them are profoundly Eurosceptic.

I am not a fan of referendums, because I believe in representative democracy. I believe that we are elected to come here and that the sovereignty of Parliament is the important principle on which we should act.

[Henry Smith]

Was the hon. Gentleman in favour of the referendum on the Welsh Assembly?

[Chris Bryant]

I have not been in favour of referendums at all and I have made this argument for many years. I was opposed to the suggestion that there should be one on the constitutional treaty and I said so in the House, for which The Sun and various other newspapers condemned me extensively. On the whole, I am not in favour of referendums, but there are times when the political class decides to navigate around Parliament and find some other means of implementing things. I think we were right to insist, after the second world war when we effectively rewrote the German constitution, that Germany should not be able to hold plebiscites because unfortunate circumstances can sometimes arise.

I am not a fan of referendums. Particularly in relation to treaty-making, they are unfortunate because they make it far more difficult for a Government to have the freedom to negotiate that they need. Of course there must be proper parliamentary scrutiny of that process. Notwithstanding the splendid work of the hon. Member for Stone (Mr Cash), I think the House still does European scrutiny very poorly because far too few Members want to take an active, engaged role in that process, much of which comes not from the Foreign Office but from every other Department of Government. It does not give a Government a strong hand to insist that there will regularly be referendums.

I believe the Government want to be able to repatriate some powers from the European Union to the United Kingdom. The process outlined in the Bill makes it almost impossible for them to be able to do so in the next five years. Other Governments will say, “You’ve already said you’re not going to have any treaties because you reckon that you won’t get a yes vote for any referendum.” That is why the Bill binds the hands of the Government.

On clause 18, the sovereignty clause, the European Scrutiny Committee has done a good job. It is right that, as the Committee points out, the clause adds nothing to the present situation. Lord Justice Laws, in the Thoburn case in 2002, was right when he said that

“there is nothing in the ECA”—

the European Communities Act—

“which allows the Court of Justice, or any other institutions of the EU, to touch or qualify the conditions of Parliament’s legislative supremacy in the United Kingdom. Not because the legislature chose not to allow it; because by our law it could not allow it. That being so, the legislative and judicial institutions of the EU cannot intrude upon those conditions. The British Parliament has not the authority to authorise any such thing. Being sovereign, it cannot abandon its sovereignty.”

Lord Justice Laws was absolutely right. That is why the clause is dangerous. It applies only to European law, but large numbers of the elements that affect our relationship with the EU are laws that come from other parts of Government. That is why in his evidence Professor Tomkins was right to urge the House of Commons not to proceed in this way in the Bill.

The whole Bill is, in the words of Shakespeare, “zed”, an “unnecessary letter”. It misses the need that exists out there to engage positively with Europe.

18:42

[Mr William Cash (Stone) (Con)]

People have fought and died over many centuries over the need to affirm parliamentary sovereignty—in the civil war and at the time of the defeat of the Stuarts in the 17th century, when the Stuarts’ absolute sovereignty was literally killed off. Since the advent of modern democracy in 1867, people have fought and died in two world wars to preserve the right to govern themselves through their own Parliament by freedom of choice in the ballot box.

The European Union claims sovereignty over our democratic Parliament, and this mouse of a Bill does little to preserve it. Given the present European crisis with the euro, as my right hon. Friend the Member for Wokingham (Mr Redwood) so accurately pointed out, and given the failure of economic governance in which we are absorbed and the coalition Government’s continuing acquiescence in European integration and their refusal to repatriate powers, the Bill does little or nothing to improve the situation.

The European Scrutiny Committee reported last night, to an eerie silence from the BBC, and as we clearly indicated, the Committee’s report is essential reading for those who really want to know what is going on. There are grave objections to the principle, the methodology, the distorting and misleading explanatory notes that accompany the Bill, and clause 18 itself. Clause 18 is a judicial Trojan horse leaping out of Pandora’s box. It is not, as the Foreign Secretary claimed, an enlightened act of national self-interest.

Parliamentary sovereignty is not built on a common law principle, as the Government claim. It is built on the sturdy foundations of the freedom of choice of the voters of this country, and not the whimsy or the Euro-integrationism of some Supreme Court judges. They increasingly claim that they are upholding the rule of law, but I have to ask which rule and whose law.

Shortly before he died last year, Lord Bingham, the late Lord Chief Justice, in his book “The Rule of Law” took on three fellow members of the Supreme Court who had previously adjudicated on the Jackson case with him in the House of Lords a few years ago as to their views on parliamentary sovereignty, as set out in our report. This is an extremely unusual situation and was greatly merited. I do not impugn their motives, but I criticise their judgment.

Only a couple of months ago, Professor Drewry of London university stated in a lecture that

“one can perhaps detect in the recent pattern of House of Lords and Supreme Court decisions, an appetite on the part of the Justices—encouraged by some continuing developments in EU and human rights law—to begin to get to grips with constitutional issues that previous generations of judges would have regarded as completely off limits.”

In this context, judicial activism is on the march. It has been there for a long time and it is increasing its tempo. The judges are not toying with all this, as was suggested by one witness. I suggest that Members read not only our report, but the articles, many of them written by these judges, and the speeches, for example, of Lord Steyn and Lord Hope, and many others that are quoted in our report.

The Bill, as Professor Adam Tomkins said in evidence, and as I mentioned in an intervention on the Foreign Secretary, is an invitation to litigation and, I would say, deliberately so. It has been left in a dead letter box in the precincts of the Supreme Court across Parliament square.

Clause 18 is not a proper sovereignty clause, when it could have been what was promised in our manifesto. Last night the Minister for Europe said that the Bill

“delivers on what was in the coalition programme simply as an agreement to consider the case for a sovereignty Bill”,

and that the Bill—that is, a sovereignty Bill—

“is being introduced by the means of clause 18”.

I am bound to say that it is not that at all. It is even dangerous.

[Thomas Docherty]

As the hon. Gentleman says, this is a mouse of a Bill. Does he agree that what we need is genuine reform of the European Union so that it delivers what it should be concentrating on, and that sovereignty should remain in Parliament and not be passed across to shyster lawyers arguing the case in the Supreme Court?

[Mr Cash]

I strongly agree with that sentiment. Indeed, I go further and say that I have always argued for an association of nation states based primarily on trading and political co-operation. Above all else, we must ensure that we make those decisions in the House on behalf of the electorate. Where we find it impossible to make those decisions, it is increasingly argued that it should be done by referendum, when we abdicate the power in the House to the people as a whole.

Clause 18 defies the sovereignty clauses on which the shadow Cabinet, the Whips and Back Benchers voted on several occasions before the general election, using my “notwithstanding” formula. Our report, based on clear evidence from constitutional experts, upholds both the principle and the wording of the “notwithstanding” formula, which I proposed in amendments to the Legislative and Regulatory Reform Bill when we were in opposition. The Whips even asked me to put in their own tellers. As I said to the Minister for Europe last night, he too voted for those provisions. Why not now, therefore, and in the Bill?

We have no hope of resolving the effect and implications of the European crisis on our country, or of reducing by deregulation the impact of European laws on our businesses, including our small businesses, and our deficit, if we do not remove the overall burden of the 50% of economic regulation now on our own statute book, according the House of Commons Library on 13 October.

[Mr Jenkin]

Is not the real question, which those on the Government Front Bench must answer, why they will not put a declaratory clause, notwithstanding the European Communities Act, into the Bill. Are they saying that that itself would put us in breach of the European treaties? I submit that it would not. Should not they accept that by putting a “notwithstanding” clause into clause 18, they would, notwithstanding the European Communities Act, be reaffirming the supremacy of the House, which is long overdue?

[Mr Cash]

I agree, and the evidence that we received indicates that the courts would have to accept that..

We are a parliamentary democracy, not a judicial autocracy. The common law principle, wrongly asserted as the basis for parliamentary sovereignty by the Government in their explanatory notes, gives the courts the interpretative means to walk through the gateway of our constitutional law into their application of EU law, including even the assertions of the European Court of Justice over our own Parliament and our own constitution, as well as our own laws.

Our report repudiates the means whereby the courts could gain, and some of them want to be the ultimate authority in the land. We were against Lisbon and for a referendum as a party. We can veto any treaty in future if we wish to do so, so why not do so? The Bill makes no provision for our current predicament, and provides only relative safeguards for the future, subject to the baleful influence of a Minister’s decision as to whether a referendum would be required or not. One issue has been described by our witnesses as both dangerous and unnecessary, namely clause 18 in the context of the Bill as a whole.

This debate is about trust—the trust that the British people for centuries have granted to their elected representatives to do what is right by them and uphold the democracy for which people fought and died. The Bill betrays that trust by doing nothing to unwind the effects of failed European integration and its impact on us, and does little or nothing to provide security for the future as Europe flounders around in ever-decreasing circles and chaos.

The Bill is an opportunity missed to stop the acquiescence in the failed European integration at every turn, as I put it to the Prime Minister a few days ago. It is also a missed opportunity to reaffirm our parliamentary sovereignty with a proper sovereignty clause. The Bill is a missed opportunity and I shall not vote for it.

18:52

[Mike Gapes (Ilford South) (Lab/Co-op)]

The hon. Member for Stone (Mr Cash) referred to clause 18 as a judicial Trojan horse. I would like to refer to the Bill as a whole as a pantomime horse. It is clear from what the hon. Member for Westmorland and Lonsdale (Tim Farron) said that there must have been some very interesting discussions within the coalition about exactly what would be put into the Bill and quite how it would be justified. I do not know what discussions went into the explanatory notes, but it would have been interesting to have been a fly on the wall, particularly looking through the references to the justifications for the list of items in schedule 1. The notes state:

“provides that any proposal to remove the UK’s veto over the use of any of the Treaty Articles listed in Schedule 1 would require a referendum.”

The reality is that many of the issues that are being proposed as requiring a referendum are not massively significant. As the hon. Member for Harwich and North Essex (Mr Jenkin) pointed out, the real issue for many Back Benchers—mostly on the Conservative Benches, although I accept that there are one or two on the Labour Benches too, but not—me is a referendum on the issue of in or out of the European Union.

Like my hon. Friend the Member for Rhondda (Chris Bryant), I have also been very much an opponent of the idea of referendums. I would agree with former Prime Minister Baroness Thatcher, when she quoted the former Deputy Prime Minister and then Prime Minister Clement Attlee as saying that referendums were the devices of demagogues and dictators. There is a large element of truth in that. We must be careful if we start to move away from parliamentary sovereignty and democracy towards a referendum-based society. If we are not careful, we could end up like Italy, and the way in which Italian politics have developed over recent decades is not a model that we should follow.

I want to say clearly that there is a range of reasons why the Bill should be opposed, but one of the most important is that it does not address the real issues that face the European Union. We should be having a debate about the rise of Asia; about how the EU is effective globally; about how the External Action Service can get the resources and the competent people to be able to play a role in avoiding conflicts and tensions and building peace around the world, as well as its diplomatic role. But we are not doing that.

We will not have, as has been pointed out from the Front Bench, the pre-European Council debate that we have always had on the Floor of the House, because the Government, for their own internal reasons, have deemed it something that they do not wish to have, and today becomes a very poor substitute.

[The Minister for Europe (Mr David Lidington)]

May I remind the hon. Gentleman that since the adoption of the proposals in the Wright report, responsibility for arranging those debates on the European Union has passed from the Government to the Backbench Business Committee? It is for that Committee to make that provision from the 31 days available to it.

[Mike Gapes]

The Government are hiding behind the words in the Wright Committee’s report. The reality is that if the Government wished to, and they thought that it was sufficiently important, we could have a debate in Government time on the Floor of the House, as we have always done, on the matters to be discussed in 10 days’ time at the European Council meeting, which comes at a crucial time for the future of this country and the EU. The issues range from the crises in Greece and Ireland, to climate change and the Cancun meeting, and what is happening with regard to China and its role in the world. Not least is what will happen over the coming decades with regard to migration policy and the impact that global changes will have on the people of north Africa and elsewhere who might wish to migrate to the EU. Those are the issues that we should be discussing.

We have had a lot of comments recently about Russia, although I will not depart from the subject of debate today. Frankly, the relationship between the EU and Russia is a complete shambles. There is no agreed approach on energy policy or on how we deal with human rights abuses and the suppression of democratic opposition in Russia. Why do we not have a debate about the role of the EU there? These are the vital questions, but instead of discussing them we are hiding behind the minutiae of a proposal, which if it is implemented will, as the hon. Member for Stone pointed out, put power not in the hands of a sovereign Parliament and Members of Parliament—elected representatives—but more and more in the hands of the judges and the judicial authorities, who will increasingly interfere in a political way. They will make the decisions about what matters are to be decided, not the elected people who represent the people of this country.

That is a fundamental matter, yet the Government are slipping this measure through, so that, with all the proposals in schedule 1, clause 18 and elsewhere, we will end up with the judicial system, not the political system, determining how this country is run. That is a fundamental decision—a fundamental matter—yet it has been slipped into the Bill as though it were a safeguard against the European Union taking away sovereignty. Actually, the proposal gives more power to the judges and to the legal system to take away parliamentary sovereignty. That is nothing to do with the European Union; Ministers themselves have determined those matters.

[Neil Carmichael (Stroud) (Con)]

Listening to the debate so far, I think that we might need a referendum to decide whether we need a referendum. As we are looking at the role of the judiciary and its capacity to make decisions, however, does that not underline the sovereignty of this country? Our judiciary makes those decisions.

[Mike Gapes]

I am not so sure that I want our judges making political decisions. Political decisions should be made by elected politicians, because after all we can be removed and our electors can throw us out. The judges cannot be elected, unless the hon. Gentleman wants us to adopt—God help us—the American system, and we should not do that.

The Minister, in his recent written statement, said:

“The common law is already clear…Parliament is sovereign.”—[Official Report, 11 October 2010; Vol. 516, c. 4WS.]

He went on to say that the Bill’s provisions do not alter the existing relationship of EU law and UK law. In which case, why do we need the Bill? If Parliament is sovereign, as he states, why have the Government come up with the proposals before us? The Bill is a fig leaf. It is a political tactic to give the impression that the Government are fulfilling the Conservatives’ obligation, in their manifesto commitment, to their Eurosceptics on a possible referendum—but not on the issue on which the hon. Member for Harwich and North Essex wishes to have a referendum; it is to be on other issues.

The Bill is an absurdity. It is a bad Bill, which leaves open the potential for legal challenges and judicial reviews, takes away power from Parliament and gives it to the judiciary, and does not change the relationship, as the Minister says, between existing UK law and the European Union. Therefore, why do we need it? It is a disgrace, and it should be rejected.

19:02

[Mr Stephen Dorrell (Charnwood) (Con)]

I do not always agree with my hon. Friend the Member for Stone (Mr Cash), but when he describes this as a mouse of a Bill he is rather closer to the truth than the rhetoric of the hon. Member for Ilford South (Mike Gapes), who slightly overstates the dangers that are attached to it.

I speak in support of the Bill. Like my hon. Friend the Member for Westmorland and Lonsdale (Tim Farron), I am a pro-European, although, when I listen to the enthusiasts make the case for our membership of the European Union, I quite often conclude that the case is made in rather more apocalyptic terms than those that I would choose. We heard a good example of that from the hon. Member for Rhondda (Chris Bryant), who seemed to claim credit for the European Union in the collapse of the Soviet bloc and in the outbreak of democracy in Spain, Portugal and Greece. No doubt he would attribute to it the green revolution in Ukraine—

[Mr MacShane]

Orange.

[Mr Dorrell]

Orange. The right hon. Gentleman is quite right. We regard all those developments as steps in the right direction, but, although there is a chain of causality back to the European Union, it is a relatively modest one.

I shall try to make the case for the Bill, which should be supported, in considerably more modest—one might even say, more sceptical—terms, because people who claim for themselves the title of sceptic in the European debate often desert the basic principle of scepticism, which is to stand back from the argument and seek to assess it more coolly than sometimes is the case.

I have drawn attention to the argument from the hon. Member for Rhondda in support of the EU and our membership of it, but those who argue the case against it, and increasingly explicitly argue that we should leave it, tend to express the argument in terms of irreversible shifts of power and use the word “permanent”.

I again am a sceptic, however, because history teaches us that no human institution is permanent and there are no irreversible shifts of power. There is only a tide of human events, and the case for the European Union, which I am happy and, indeed, keen to make, is the pragmatic case whereby, in the world of 2010, the European Union, which is a dramatically different institution from that set up by the treaty of Rome in 1958, should be supported not because it is perfect, when it plainly is not, but because it serves a purpose. Imperfect as the EU is, it is part of the arrangements for the governance of Europe, and on balance it contributes more good than it inflicts harm. In human affairs, that seems to me justification enough for the institution to continue to exist.

It is often said of the European Union that there is no European demos. Indeed, my right hon. Friend the Foreign Secretary used to make that case when he argued for a more sceptical approach to the development of European institutions. It has become increasingly obvious that there is no such thing as a European demos, but the EU, as it has evolved since 1958 and partly because it now has so many more members, is increasingly obviously an intergovernmental organisation, which most people in the House and, indeed, among our constituents accept as a fact of life, not something that should be particularly resisted.

[Mr Jenkin]

Where is the evidence that the European Commission or the European Court of Justice accept that the EU is an increasingly intergovernmental organisation? I put it to my right hon. Friend that, actually, they insist on quite the reverse.

[Mr Dorrell]

They may have ambitions, and people within those organisations plainly do have ambitions, but that is exactly what the Bill seeks to address. It introduces not an irreversible, immovable, permanent safeguard that can never be overcome, but, as my hon. Friend the Member for North East Somerset (Jacob Rees-Mogg) said, a further inhibition on the development of competence within the European Union, which I would have thought my hon. Friend the Member for Harwich and North Essex (Mr Jenkin) welcomed. Again, it is a modest step. My hon. Friend the Member for Stone dismissed it as a mouse of a Bill, but even if it is a mouse it can be a mouse on the right side of the scales, and that seems to be the case for it.

The Bill is right in principle and in practice. It is right in principle, because I do not agree with the arguments against referendums in principle when the question at stake is how the country is run. I agree with one of the points that my right hon. Friend the Member for Wokingham (Mr Redwood) made, when he said that part of the problem in terms of public acceptance of the European case is the perception—indeed, the reality—that competence has passed to the EU without the scrutiny that our constituents want to see. That is a correct statement of historical fact, so, in order to rebalance the argument, it is a step in the right direction and a correct principle that any further accretion of power to the European institutions should be subject to a referendum block, the terms of which are set out in the Bill. The hon. Member for Ilford South argued that a Bill introduces the opportunity for judges to interpret it—well, yes; that is the nature of an Act of Parliament. If we pass an Act of Parliament, that creates a statute, which is interpreted in the courts. There are no Acts of Parliament of which that is not true.

Against the background of what has happened in the European argument over 40 years, the Bill introduces the correct principle that further accretion of competence to the European institutions should be subject to a referendum. That is right in principle. I also think that it is right in practice, for the important reason that my right hon. Friend the Foreign Secretary set out in his speech and which was impliedly accepted in the speeches made by both the shadow Foreign Secretary and, ironically, my right hon. Friend the Member for Wokingham. What matters in the European argument now is the use of these competences and how this increasingly intergovernmental organisation reacts to the pressures of events.

My right hon. Friend the Member for Wokingham pressed the point that there are some fundamental threats to our economic development, tied up in particular in the current pressures on the euro. I entirely agree with my right hon. Friend about the dangers that arise as a result of those developments. The case that my right hon. Friend the Foreign Secretary was making for the Bill is that it is a modest step to disarm the constitutional argument about how we are run, in order to focus the debate on where it properly needs to be—on how those competences are used by the European institutions and how that impacts on our way of life.

[Mr Clappison]

My right hon. Friend is making an eloquent speech. May I take him to the question of intergovernmentalism? Is that not precisely what we were told was happening at the time of the Maastricht treaty, with the construction of the pillars, which were supposed to reserve certain competences and areas of responsibility for the intergovernmental method? Since then, has not the European Union deliberately knocked down the pillars and brought those areas of intergovernmentalism into the main European treaty, which relates to the functioning of the European Union, and that in no way can be described as an intergovernmental body?

[Mr Dorrell]

My hon. Friend is entirely right. Like him, I would have much preferred it if the Lisbon treaty had not been introduced, so that the pillars of intergovernmentalism in the Maastricht treaty were protected. But that does not alter the fact that if we attend a Council of Ministers meeting in Europe to exercise the competences of the European Union, the process of discussion about how the power is used by the Council of Ministers, particularly in a world of 27 member states, has the feel of a negotiation between member states of an organisation. It is a negotiation between member states.

My hon. Friend the Member for Harwich and North Essex is right to say that there is a strong power of initiative in the European institutions. Like him, I do not want any further competence to be passed to them. My case for the Bill is that it reduces the risk of that process happening again; it does not make it impossible, but it reduces the risk. I hope that it will make a modest step towards rebuilding public trust in the framework of the European argument and therefore refocus that argument on where it properly needs to be—on how those competences are used, rather than on yet more discussion about the further extension of “the European project”.

19:14

[Mr Denis MacShane (Rotherham) (Lab)]

We have had a menagerie-type debate: Pandora’s boxes have been opening, Trojan horses have been jumping out of them and there have been mice of different sizes to contemplate. But there is a broad division—between Labour Members, along with the hon. Member for Westmorland and Lonsdale (Tim Farron), and most of the speakers on the Government Benches. They have a rather Hobbesian view of Europe, in which there is an undeclared war of all against all.

I take the view that Immanuel Kant—or, as it should be pronounced properly in German, “Immanuel Kunt”—put forward in his perpetual peace argument. He argued that Europe needs a construct of rule of law, a Lockean Europe, in which we can live together in perpetual peace, as he thought. It has taken perhaps 200 years to get that far, but that is my version of Europe rather than the permanently negative one where it is Britain contra mundum, about which we hear so much from the Government Benches.

[Austin Mitchell]

As my right hon. Friend is representing his views as those on the Opposition Benches,—I do not think that they are—may I ask whether his own constituents are Kantians or Lockeans?

[Mr MacShane]

Perhaps I shall leave the reply to my old friend, Jim Naughtie.

We have also seen again today what surely must be an iron law of British politics—people can campaign in opposition as Eurosceptics, but they have to govern as Euro-realists. The outbreak of Euro-realism in the coalition Government was not brought about simply by the presence of the Liberal Democrats; it has happened because no Government of Britain could remotely sustain themselves in a relationship—not just to their European partners, but to partners around the world—on the basis of the hyped-up rhetoric that we heard from the Foreign Secretary when he was shadow Foreign Secretary. From that most powerful and amusing orator of the current Commons, we heard a very workaday speech. My right hon. Friend the shadow Foreign Secretary made a powerful and witty speech that reminded me of the late John Smith. But there we are—I have described what happens when people become Foreign Secretary. Realism has to break in.

[Kelvin Hopkins (Luton North) (Lab)]

I remind my right hon. Friend that one bit of Euro-realism is that the euro is in a state of collapse. Is that not realism as well?

[Mr MacShane]

I do not want to enter into a duologue with my hon. Friend about the euro, although I expect that it will be around a little longer than its gravediggers may imagine or hope. If we are to revert to that Hobbesian world in which every currency fights against every other, devaluing and insisting that products be traded on a different basis every month or every week, there will be no swifter invitation to the setting up of protectionist barriers such as existed before the Common Market, the European Community and the European Union.

[Kelvin Hopkins]

rose—

[Mr MacShane]

We have only a short time. My hon. Friend will have time to make his own speech.

The Foreign Secretary’s speech was to please the party faithful, as will be the one we hear during the wind-ups. The fact that it so singularly failed to do so was reflected in the speeches made by the right hon. Member for Wokingham (Mr Redwood) and the hon. Member for Stone (Mr Cash); perhaps we will hear that from other speakers, too, if they catch your eye, Madam Deputy Speaker. One cannot please the Daily Mail and represent Britain faithfully and effectively.

I read through the Bill fairly carefully, as I hope we all have. It is not so much a mouse, as a mouse without definition. The key adjective—and I am nervous of legislation that is built around an adjective rather than a substantive—appears in clause 5, under which a Minister has to come to the House and say, “I think there should be a referendum because in my judgment there is a ‘significant’ transfer of powers.” But “significant” is not defined; it will be in the eye of the beholder.

I am not sure whether that will lead to references to the courts. I hope not. I see before my eyes the gradual atrophying of Parliament, as judges decide bitterly fought election campaigns. Libellous and defamatory remarks have certainly been made about me in election campaigns that I would not dream for one second of taking to the judges, who can now set aside the sovereignty of the British people and say that an election is null and void. More generally, judges want to have a much greater say in our parliamentary democracy. I will not use the Pandora’s box metaphor, but the Bill opens the door to a lot more of that.

The extraordinary shopping list in the Bill also worries me. The Library document refers to 57 items that must trigger a referendum, but I think that the list contains 56 items. Schedule 1 states that any change that involves an

“approximation of national laws affecting internal market”

must trigger a referendum. As Prime Minister, Baroness Thatcher did nothing of greater service to this nation than to bring in the Single European Act, which led to the greatest approximation of national laws affecting a market of many different nation states in the history of humankind. I utterly welcome that. We need more approximation and more open markets.

It would be good to have a single patent system, but if 26 other European countries followed our route, any approximation of the internal market, such as a single patent system, could involve a referendum in Estonia, Poland or Hungary, which would begin to roll back that single market. What is sauce for the British gander will be sauce for 26 other member states’ geese. Those member states will take the message from the Government and from this House of Commons today—sorry, I am about to use the animal metaphors that I decried at the beginning of my speech—that because this wretched little dormouse or shrew of a Bill will be passed tonight, Britain is turning its back on them.

Oddly enough, the Government are not completely doing that. I was always told the adage that money is power and power is money. We are blithely giving away £7 billion of taxpayers’ money to help Ireland out of its hole without having any serious debate or discussion. This is a profoundly important point. It is not good enough for the Leader of the House on Thursday mornings or the Minister for Europe, the hon. Member for Aylesbury (Mr Lidington), whom I like and respect, to say it is up to the Backbench Business Committee to decide whether to have a debate on Europe. It is of profound importance to the House of Commons that we have a thorough debate on Europe twice a year.

Tomorrow, there will be an EU-Russia summit. My hon. Friend the Member for Ilford South (Mike Gapes) has raised profound points about Khodorkovsky, human rights, Sergei Magnitsky and other appalling cases of the treatment of people inside Russia. In addition, we have huge worries about relations with Turkey. I am a supporter of Turkish accession. What a preposterous notion it is that the accession of Turkey, which is comprised of 80 million people from completely different backgrounds, should not be submitted to a referendum, but the question of whether there will be an extra advocate-general or judge-advocate should be submitted to one. This is absolutely ridiculous and the British people—and I am afraid the people who hate democracy, such as those in the British National party and the UK Independence party—will mock us because of the issue of Turkish accession. Yes, the Foreign Secretary may say that it is some way off, but it will dismay a great number of people that we are legislating for eternal referendums on minor issues, but not on Turkish accession.

I will put my cards on the table. The Foreign Secretary said wrongly that Germany has similar provisions in its law. It does not. The German constitution was devised not by us but by the German people and it expressly forbids plebiscites for good, clear, historic reasons. Yes, there is a German constitutional court, but that is because it has a written constitution. Perhaps that is a road we need to walk down.

I hope that the Bill is opposed, because it weakens Parliament and Europe. It sends a message that, under this Government, the commitment, concern and leadership that Europe is so desperately lacking will not come from the present crop of Ministers. That is a shame. Europe needs leadership because it is going through a crisis, and the absence of that leadership from this Government is to be deplored.

19:25

[Richard Drax (South Dorset) (Con)]

How interesting that the poor old mouse has taken such a lot of stick tonight. Several hon. Members have used the expression “mouse of a Bill.” It is a mouse that the EU cat will play with, mutilate and consume. I have heard the words, “judicial reviews,” “written constitution,” “competences,” “vetoes,” “referendums,” “advocate-generals,” and “ratchets.” That is the language of the bureaucrat. The bureaucrat loves this. Such legislation employs the bureaucrat and gives them lots of money on the gravy train in Europe.

We want our country back. That is what we want. We do not want to say goodbye to Europe; we want to trade with Europe. I like Europe. I like the French, the Germans, the Italians; they have so much to offer us. However, we should not be ruled and regulated by Europe, particularly by the unelected Commission. If we want to be more committed to Europe in the sense that Labour Members wish—to be in Europe, to trade with Europe—it needs to become more democratically accountable. That is why, at first glance, the Bill ticks all the boxes. What could be more democratic than to ask our nation to vote on new EU initiatives? As my hon. Friend the Member for Clacton (Mr Carswell) pointed out—his expression has been used twice tonight—the problem is that the legislation is all smoke and mirrors.

As we have heard, we are being asked to approve a Bill that includes a referendum lock and that sets out to ensure that no future transfer of power to Brussels will take place without the approval of people in this country. That is an admirable aim that we promised in our manifesto, when we undertook to repatriate powers from the EU. The Bill does not do that. Labour—most of you—betrayed this country. You promised us a referendum on the Lisbon treaty. You promised us—

[Madam Deputy Speaker (Dawn Primarolo)]

Order. The hon. Gentleman must not place burdens on the Chair that do not exist. Will he desist from using the word “you” when making accusations about other people’s behaviour?

[Richard Drax]

I apologise. I am happy to retract that statement.

To our Government’s credit, they have attempted to prevent the ratchet clauses with the referendum lock. That is a seemingly elegant solution that, as I said, will give power back to the people. However, if we look at the Bill more closely, we will see that there is plenty of wriggle room. I, for one—there are obviously many others—am unhappy with that. The lock is entirely bogus. A referendum will be triggered only if Ministers believe what their civil servants tell them and agree that the subject is significant. If they do not consider it to be significant, there will be no referendum and the matter will become law.

In areas where primary legislation is required but that are not considered significant enough to put to the people, we are asked to take the matter on trust. We are asked to trust that our masters will ensure that no further powers are transferred away from the UK during the next Parliament. This would be easier to swallow had we not already allowed the EU to roll us on our backs on five occasions in the past six months. We have had the European External Action Service. What action—to take our money? We have had the European arrest warrant. I have a constituent, Michael Turner, who has been in jail in Hungary for 115 days with no charge. His crime, allegedly, is that he left creditors owing about £18,000 when his business closed in 2002. There has been an endless pursuit by the Hungarian authorities to find an offence with which to charge him and a colleague. The investigation was dropped because they could not find enough evidence to get him, and now they are mounting another one—but there is still no charge. Then we had EU regulation over the City, EU oversight over our national budgets agreed to, and finally, our contribution to the EU budget increased despite our objections. May I ask what happens when we really do roll over?

The truth is that not a single one of those transfers of power would have been halted as a result of the referendum lock proposed today. Nor are the accession agreements affected, so new countries joining can do so, as the right hon. Member for Rotherham (Mr MacShane) said, without the EU asking our citizens. I can see why they would not be asked. We already have 27 countries in the EU and hundreds of thousands of people are able to move freely within it. That was practicable when the EU was a smaller organisation, but it is not practicable any more.

There are constitutional questions hanging over this legislation that have tested far greater legal minds than mine. Suffice it to say that one five-line passage—clause 18—does not enshrine our sovereignty adequately. Professor Adam Tomkins has said that the Bill

“goes out of its way to invite litigation”.

His main concern is that it does not establish which of the two competing legal systems now operating in this country has supremacy: English law or EU law. He says that taken to its conclusion, ministerial decisions could be challenged in the courts. We have seen enough of that already, with our courts and judges overruled by European judges.

Our independence was hard-won over hundreds of years, yet we are seeing it trickle away as we are increasingly subjugated by unaccountable, unelected bureaucrats. A torrent of legislation threatens to submerge our identity. No fewer than 3,000 new laws passed in this Parliament last year were related in some way to the EU, and you can bet that none of them would have triggered a referendum. We have been giving away our right to govern ourselves, and we must take it back. Toothless legislation that gives the impression of protecting our sovereignty while doing nothing of the sort will simply hide the rot a little longer.

When I was elected, many of my constituents made it clear that the power-grabbing EU was one of their primary concerns. I would be serving them badly if I were to pretend that this Bill would do anything concrete to protect the country they love. I will not be supporting the Bill.

19:33

[Austin Mitchell (Great Grimsby) (Lab)]

I am enthusiastic about speaking on this Bill, because I would not want the views of Labour Members to be taken to be the extrusion of Euro-cant that has poured in from Rotherham and the Rhondda. The views of some Labour Members are much more in tune with what our voters think. My hon. Friend the Member for Vauxhall (Kate Hoey) has given us a clear indication of those views.

The problem is whether the Bill is worth supporting. It is a sad little Bill that should really be called the “Closing of the stable doors after every horse has bolted across the countryside” Bill. I am sure that the nation wants a referendum on this issue. It wants to be consulted and wants its say on Europe, but it has not been allowed it since 1975, when it was consulted on something totally different called the Common Market—a harmless, fun place that was going to make the weather better and make everybody happy. That is the last time that people were consulted, and they now want to be consulted on the shape of the current monster that is taking more and more powers.

This Bill does not provide for that consultation. The Conservatives told us in opposition, and I think in their manifesto too, although I do not have it here to check, that they were going to repatriate criminal justice and the laws on social and employment issues, but that has all gone. The stable is empty, for practical purposes, and I see the pathetic spectacle of the Foreign Secretary stood at the stable door after he has closed it singing “Will Ye No Come Back Again?” to the horses from Europe galloping all over the United Kingdom’s countryside.

The Liberal Democrats’ approach was even more comic. They promised us a referendum on the treaty and then suddenly became aware of the fact that it would be defeated if it were put to a referendum. They therefore changed what they were asking for from a referendum on the treaty, which they said was no longer a treaty, to a referendum on “in or out”, with which they thought they might stand a better chance. However, they knew that nobody would give them such a referendum; they were trying to get a referendum that was an impossibility.

I cannot be over-critical because my own party’s position was, at best, ambiguous. We said, “Yes, we shall have a referendum”, and then we said, “Well, this isn’t really a treaty—it’s something else.” Perhaps it was a German sausage or something; I am not quite sure what it was supposed to be. Anyway, we said, “It’s not a treaty worth having a referendum on; it’s something else, and therefore we won’t give you a referendum.”

This is a history of betrayal by all three parties, and we have to make good to the people, who want a referendum. There is a need for a referendum, but this Bill does not provide for it. As my right hon. Friend the Member for Normanton, Pontefract and Castleford (Yvette Cooper) said, it will be a lawyer’s charter, and one that ignores much of what is going on in Europe. What is going on is the steady process of accretion of power, money and control over this country.

We should look at the increasing costs of Europe. The annual budget contribution is now £7 billion, and rising because of devaluation—it will rise to £10 billion fairly shortly. There is £2 billion for projects such as Galileo, which will build, at enormous expense, a satellite guidance system that the Americans already provide for free. There is £8 billion for the costs of the common agricultural policy, which comes from buying food on a dearer market when it is available more cheaply elsewhere. There is £2.8 billion for the costs of the common fisheries policy, with our fish being caught by foreign vessels and taken to Europe to provide jobs there. There is the cost of regulation, which has been calculated at £20 billion. Then we can add the cost of the monstrous machinery of the new foreign service, the European External Action Service, which will be more expensive than our own Foreign Office. All its ambassadors will have, at enormous cost that we are paying for, bullet-proof cars and bomb-proof embassies. If we add that lot together, we get to £40 billion—perhaps more. If we were not paying this Eurogeld every year, across the exchanges, we would not need the diet of cuts that the Chancellor and the Liberal Democrats are proposing for us.

[Kelvin Hopkins]

My hon. Friend has omitted to mention—I know that he knows this to be true—that we have had slower growth in the European Union than we would have had had it not existed. We had faster growth when we had stable but separate currencies, and that led to the prosperity that we knew in the post-war era. Slower growth in the European Union, which has been compounded over many years, means that we are now less well-off than we would have been had there not been a European arrangement.

[Austin Mitchell]

My hon. Friend is exactly right. We have suffered from slower growth, and now we have a 25% devaluation. We cannot generate the exports that we want because of the deflation in Europe that is necessary to heal the problems of the euro.

That brings me to the second problem that I want to deal with. Not only have the horses bolted from the stable, but it is on fire as the crisis of the euro continues. We warned Europe that it would not work and it has not worked. One exchange rate and one interest rate cannot cover the varied circumstances of Europe. A central Government is needed to redistribute to areas that suffer from the single currency and the single interest rate. Countries all have different rates of inflation. It is impossible for the weaker economies to get down to Germany’s low rate of inflation. The result is that their trade suffers, because they cannot get export prices down to a competitive level. Gaps have therefore emerged and those gaps have led to a crisis, and Europe’s way of dealing with that is to dole out more funds from a big bucket—a bucket to which we have contributed in the case of Ireland.

[Jonathan Reynolds (Stalybridge and Hyde) (Lab/Co-op)]

My hon. Friend is a critic of the European Union, and he is listing many differences that he would like to see in the European arrangements. Does he not think that changes that the British Government want and that are in the national interest might be harder to achieve if this legislation is passed here and is copied across the EU?

[Austin Mitchell]

My argument is that the Bill does not help us to deal with, or give us a veto over, the problems of Europe as they are. Those problems are the real threat to this country. Let us say that we are doling out £100 billion to Greece and £100 billion to Ireland and if Spain is the next to collapse, the figure could be about £400 billion, so the whole fund of £750 billion could be gone in one fell swoop. Germany will not let that go on. At some point, the system must collapse.

The Bill has nothing to say on that process and the Government will not tell us what they are doing in the European negotiations. What is our point of view? Are we prepared to support that process and to commit money? The Bill will not give us a veto over any such commitments and the Government will not even tell us what those commitments are. That is a disastrous situation. There will have to be a big bail-out. This situation cannot be dealt with by Elastoplast, with a bit here and a bit there. It must be dealt with by a fundamental reorganisation of the euro. In my view, a default is the only way in which to save the situation.

The Bill does nothing about that issue and nothing about one of the other major issues facing Europe—the entry of Turkey. The Foreign Secretary said that that matter is excluded from the Bill, but it would be a fundamental change to Europe. We should think of the immigration problems—to say the least—that would occur if Turkey, which has a much bigger population than most existing member states, were allowed into the European Union.

[Thomas Docherty]

I struggle to understand what makes Turkey so different from Romania, Hungary or any other eastern European nation. Is there not a danger that we will be perceived, wrongly, to be singling it out because of its Muslim nature?

[Austin Mitchell]

That may be true, but the British Government want Turkey in. I am not unfavourable; I am just saying that its admission will be a fundamental change in Europe and that the Bill will not give the British people a say over any of these matters. [Interruption.] I am not sure whether my right hon. Friend the Member for Rotherham (Mr MacShane) is making a Gallic gesture or whether it is a sign for me to sit down and shut up.

[Mr MacShane]

On the contrary, I am completely in agreement with my hon. Friend, which is rare in a European debate. It is a preposterous Bill that does not include the question of Turkish accession. That is the fundamental change that will come about in the nature of the EU and in our relationship with it. I support Turkish accession, but not to put it in the Bill just shows what a—what is smaller than a shrew?—worm of a Bill we are debating tonight.

[Austin Mitchell]

The mountains will labour and a ridiculous mouse has been born. That is certainly true. I am sorry that I mistook my right hon. Friend’s gesture—he is so European that I thought he was going, “Je m’en fous.” I gather that he was not.

I agree with my right hon. Friend’s point. The Bill does not give the British people a say; it gives them a tiny squeak, and on things in which they are not particularly interested. To give them a squeak is better than to give them nothing at all. I have to consider whether I shall support the Bill on that basis, which frankly I am loth to do. Is it worth the effort? I am certainly not enthusiastic about the Opposition amendment, which really says nothing at all. Faced with that dilemma and being somewhat jetlagged, the best solution that I can think of for tonight’s vote is to go home and read a little Keynes—I wish that the Chancellor had done the same.

19:45

[Zac Goldsmith (Richmond Park) (Con)]

I want to start simply by saying that I love Europe. I have countless brothers and sisters—I have lost track of how many—dotted throughout Europe, and probably many whom I have not yet met, for whom English is a second language. I therefore have to love Europe. There are even aspects of the European Union that in my view are very important. Without a doubt, some issues and problems are best addressed through co-operation, not least climate change and other environmental concerns, which ignore national borders. Addressing those problems has never required and does not require the creation of a pan-European superstate. There is no doubt that that is where we are heading. To take just one example, 80% of the business of the Department for Environment, Food and Rural Affairs is now determined at EU level.

There are two key problems with that extraordinary shift. The first is that the EU has too many conflicting styles of government for it to work effectively. An exasperated former Environment Minister complained:

“In one Member State, everything is permitted unless it’s forbidden. In another Member State everything is forbidden unless it’s permitted. And in some Member States everything is permitted—especially if it’s forbidden”.

When I think of this country’s appalling habit of gold-plating even the most awkward and damaging regulations, I occasionally wish that we formed part of the latter group.

There is a much bigger problem. Of all the major changes that have occurred in Britain’s history, the EU project is surely among the most significant. We have seen major steps towards the formation of a single European Government, who now have more powers than our own. That has happened with virtually no consultation. I ask passionate supporters of the EU, those who are absolutely wedded to continued integration, what they will do if ever the EU moves in a direction that they no longer approve of. The answer is that because EU decision makers are, on the whole, thoroughly insulated from proper democratic pressure, there is very little that they will be able to do. That point is fundamental. The ability to rid ourselves of unpopular politicians and regimes is the single most important ingredient in any democracy. On that basis, the EU is simply not democratic. How many people in this country genuinely believe that the vote they cast in a European election will make the slightest bit of difference to how Europe is governed?

We have a brilliant new fisheries Minister, the Under-Secretary of State for Environment, Food and Rural Affairs, my hon. Friend the Member for Newbury (Richard Benyon), who is determined to reform the common fisheries policy. Like any normal person, he is appalled that nearly half the fish that we catch in the North sea are thrown back dead or dying as a result of nonsensical laws on quotas. How many hon. Members believe that he will be able to change those laws, even with the support of this House, when he negotiates them later this month?

It is no wonder that the percentage of British people who believe that our membership of the EU is a good thing has, according to recent surveys, fallen to just 31%. It is no wonder that we have seen the rejection of treaties by the French, the Dutch, the Danes and the Irish, all of whom were ignored disgracefully by their Governments and the European Union. It is no wonder that we have seen a continent-wide decline in turnout in the European parliamentary elections from 62% in 1979 to 43% last year.

It is not only time for a referendum lock on the further loss of sovereignty, but for a national debate about the repatriation of key powers to this country, followed by a referendum to legitimise those reforms. I believe that without radical reform of the European Union, that institution will not survive. Passionate supporters of the EU should embrace the need for reform, for without it, the institution that they support will not exist in the future. A referendum lock alone is not enough, and if we are honest, it is not even on the cards. The judgment as to whether a treaty or treaty change meets the criteria for triggering a referendum will rely on the subjective opinion of a Minister and it will be for the Government to adjudicate whether a change represents a transfer of power and a loss of sovereignty. Is that really an adequate safeguard?

Almost every successful candidate in the 2005 election was elected on a manifesto that promised a referendum on the EU constitution, but there never was such a referendum, as we have heard from a number of hon. Members. We were denied one because, when the constitution was re-edited, repackaged and re-presented following popular rejection, it was cynically declared by a Minister to be merely an anodyne tidying-up exercise. That was a ridiculous claim that was denied even by the authors of the constitution.

[Mrs Anne Main (St Albans) (Con)]

My hon. Friend is making a very powerful speech, and I agree with an awful lot of what he has said. As a Member who was elected in 2005, it is that concept of anodyne tidying-up that worries the hell out of me in this Bill. It says that if something is only tidying-up, it does not need to come before Parliament. It was the tidying-up in the last treaty that the Conservative party objected to so much. I do not feel that I can support the Bill tonight. I hope that it will come back in a much better state on Third Reading, but I am not hopeful.

[Zac Goldsmith]

I absolutely share my hon. Friend’s concerns, and I wish to quote—excuse the pronunciation—Charles, Comte de Talleyrand, who once said of an unknown acquaintance:

“In order to avoid being called a flirt, she always yielded easily.”

By that logic no one can ever accuse Britain of being a flirt, because we have yielded at every single opportunity, as my hon. Friend has just reminded the House. I have just one question for the Minister. What guarantee—not assurance—can he provide that this Bill will prevent such a thing from ever happening again?

19:51

[Mark Hendrick (Preston) (Lab/Co-op)]

I have been quite dismayed by some of the contributions to the debate, from both Government Members and Opposition Members. It is well known that the Bill is supposed to be red meat for some of the Eurosceptics on the Conservative Benches, many of whom have wanted referendums in the past. I remember them asking for a referendum on the Nice treaty, then on the constitution and then on Lisbon.

[Andrew Bridgen (North West Leicestershire) (Con)]

Surely it should be blue meat, not red meat.

[Mark Hendrick]

Depends how much blood is on it, I think.

The modern Conservative party has become a surrogate for the old Referendum party. It is quite fortuitous that my speech was preceded by that of the hon. Member for Richmond Park (Zac Goldsmith), the son of Sir James Goldsmith, who served with me in the European Parliament. I remember the damage that the Referendum party did to the Conservative party up and down the country, and it is interesting to see that Sir James’s son now sits on the Conservative Benches.

[Zac Goldsmith]

The Conservative party did a lot of damage to itself in the 1997 election, because it lost the trust and confidence of the people. The Referendum party was merely trying to fill that gap, and I am very proud to be the son of the man who launched it.

[Mark Hendrick]

I am sure that the hon. Gentleman is very proud, and I am sure that Opposition Members are very proud to have him in their ranks, but unfortunately for them, the UK Independence party has taken the Referendum party’s place and is pushing the agenda even further to the right. It is even more vehemently anti-European than the Referendum party.

[Kate Hoey]

Why do my hon. Friend and other Members keep referring to Euro-realists and Eurosceptics who want to see a real debate and a referendum as somehow being on the right? Does he not accept that many members of the Labour party, many Labour MPs and many Labour-supporting people in the country think that what is going on in Europe is wrong?

[Mark Hendrick]

I thank my hon. Friend, but in my opening remarks I referred to the opinions of some Members on my side of the House, and of course she is among them. I do not think that the mainstream of the Labour party is particularly against referendums. We offered a referendum on the euro should the five tests for entry into the single European currency have been met, and we offered a referendum on the European constitution, which, as Members know, was dropped because of the referendums in France and Holland. A new treaty came forward, for which we had committed to no referendum, which was why there was no referendum on the Lisbon treaty.

The Bill is not about democracy or a referendum. For many Conservative Members it is not about any future competences of the European Union; it is about getting out of the European Union altogether. I am sure that it was introduced to try to satisfy some of the Conservative Eurosceptics, but as we have seen from today’s debate, it goes nowhere near far enough to do that.

[Nick de Bois (Enfield North) (Con)]

Does the hon. Gentleman consider that one of the main reasons why the Bill is before the House is that his party failed to deliver on its promise to provide a referendum on the Lisbon treaty?

[Mark Hendrick]

No, we failed to provide a referendum on the European constitution. As Members know, the constitution fell because of referendums in France and Holland. What came afterwards was a constitutional treaty, namely the Lisbon treaty, on which no referendum was ever promised.

[Christopher Pincher (Tamworth) (Con)]

Will the hon. Gentleman give way?

[Mark Hendrick]

Yes, but for the last time, because everybody is taking up my time.

[Christopher Pincher]

I am grateful. Does the hon. Gentleman think that there should have been a referendum on that constitution?

[Mark Hendrick]

No, I do not. The party view was that there should have been one had the constitution been put to the House, but it was not the constitution that came to the House; it was the Lisbon treaty. That is quite clear.

The referendums provided for in the Bill are not about voting on any specific competences that might go to the EU, they are cover for showing general dissatisfaction with the EU per se. They are the thin end of a very thick wedge, moving us towards withdrawal from the EU. The Bill is a sop to the Eurosceptics, in the same way as bringing the Conservatives out of the European People’s party in the European Parliament was a sop to them. The Government promised a Bill to protect sovereignty, but it does not do that. It does not change the position between this country and the EU at all.

Problems arise from the fact that this is a coalition Bill and the Liberal Democrats cannot be seen to have had no influence on it. It is noticeable that there are no Liberal Democrats in their places as I speak, whereas the Conservative and Labour Benches are quite well populated. They say that they are a more pro-European party, yet for some reason they are in with the Conservatives on this Bill and are looking more like a referendum party than a pro-European party. In Cheltenham last year, the Foreign Secretary talked about the Liberal Democrats being on a road to a united states of Europe, but it is clear from the Bill that they are on no such road.

The Conservatives do not want a sovereignty Bill, which is why the Bill has become a joke. Clause 18 does not protect sovereignty in the way that the Conservatives promised at the general election. All it does is protect the status quo, which I will discuss in more detail later. For what it is worth, the Bill is aimed at Ministers, although not Ministers of this Government, or presumably of a possible future Conservative Government. It is aimed at tying the hands of a future Government of some other political hue who may wish to accept that decisions made by an EU of at least 27 member states may be of benefit to the UK.

Irrespective of the merits of the changes to a treaty, a future Government would be forced to get legislation through both Houses of Parliament before putting it to the country as a whole in a referendum. The clear intention is that any further movement of powers to the EU is stamped on.

We already know that there are referendums to elect mayors, and that processes are being introduced for electing police commissioners. All that is happening while this country is undergoing an age of austerity and billions of pounds of cuts are to be introduced in the coming years. Incurring extra expenditure in the future on the useless referendums set out in the Bill would be ludicrous. A treaty change may make perfect sense even to a Conservative Government, but they would be forced to get legislation through both Houses and put the matter to the country.

In a fast-changing world, we need the EU to take coherent, decisive action, but the Bill will act as an impediment to, and create inertia in, decision making. The Bill should have been called the “EU Inertia Bill” or the “EU Foot-dragging Bill”—it is for Conservatives who have not forgiven the previous Conservative Government for the Maastricht treaty and those who still blame Ted Heath for Britain joining the European venture in the first place.

Before the election, the Prime Minister, who only last week described himself as the son of Thatcher, said:

“If I become PM a Conservative government will hold a referendum on any EU treaty that emerges from these negotiations”,

but of the 1975 referendum on membership, Margaret Thatcher said that referendums

“sacrifice parliamentary sovereignty to political expediency”.

He is hardly the son of Thatcher, is he?

Let me get to the nub of the issue. Traditionally, the Conservative party is not just economically and socially conservative; it also seeks to conserve existing British institutions—the monarchy, the House of Lords, the rule of law, parliamentary sovereignty, MPs as representatives rather than delegates, and no written constitution. While in government, the party of Churchill, Thatcher, Macmillan and Baldwin has never offered the public a referendum. Given this Bill and the proposed alternative vote referendum, the Conservatives seem to offer referendums only on proposals that they want the public to reject.

Instead of simply stating general principles on offering referendums, the coalition has gone through the treaties line by line and set out a mish-mash of issues on which a referendum will be called, and gives a shorter list of issues on which one will not be called. That approach is not only unnecessarily complicated, but it gives the impression that the Government cannot be trusted to exercise their judgment on whether there should be a referendum on individual decisions and treaty changes.

Under the Bill, the extension of the ordinary procedure on environment policy will require a referendum, but as other hon. Members have said, the accession of Turkey to the EU will not. Which will have the greater impact on the UK? Angela Merkel’s proposals on the eurozone would not be subject to a referendum because the provisions do not apply to the UK. That assumes that because the UK is outside the eurozone, events within it do not affect the UK. We may not be signatories to the stability and growth pact, but the pact and the stability of the eurozone doubtless have an influence on the stability of the UK economy.

The Bill is bad law and dubious politics. It is an act of posturing by the coalition. The Government are trying to satisfy Eurosceptic Tory Back Benchers, but achieve neither of the objectives that they set out to achieve. The Lib Dems are a fig leaf to hide the Conservative’s embarrassment at Britain’s membership of the EU.

20:03

[Laura Sandys (South Thanet) (Con)]

I disagree with most of what the hon. Member for Preston (Mark Hendrick) said. We have today heard a wide critique of the EU and of how we got to this situation, and I agree with most of it, including much of what my hon. Friend the Member for Richmond Park (Zac Goldsmith) said. I feel strongly that had we discussed referendums—or had we had passed such a Bill six, seven or eight years ago—we would not face the level of distrust in the country that we are facing because of the Lisbon treaty.

I very much support the Bill because it represents why I went to the people of South Thanet in May. I want to turn the tide away from rules and treaties being made on our behalf, and to ensure that the people have a say on what powers we concede to the EU. Like many Conservatives, I would have liked a referendum on the Lisbon treaty, but we were denied one. Many urged this Government to hold a referendum in any event, but that was impossible, because the deed had already been done with no reference to the British people.

[Mr MacShane]

Does the hon. Lady believe that we should have held a referendum on the Single European Act treaty of 1985, which ceded massive powers to Brussels?

[Laura Sandys]

I know that the right hon. Gentleman followed that treaty closely, but I was a touch too young to read it line by line. I would be delighted to take a history lesson on it in future.

[Mr MacShane]

On a point of order, Mr Deputy Speaker. The hon. Lady is still very young.

[Mr Deputy Speaker (Mr Lindsay Hoyle)]

I think we can rule that point of order out of order.

[Laura Sandys]

I thank the right hon. Gentleman for his very kind words.

The Lisbon treaty was a real break in trust. Big constitutional changes need to go to the public. I used to be chairman of openDemocracy. I believe that we should trust the people and that we need to ensure that the people are part of the big, fundamental decisions. I disagree with many Opposition Members—

[Mr Desmond Swayne (New Forest West) (Con)]

There aren’t any!

[Laura Sandys]

Absolutely. There are hardly any Opposition Members in the Chamber, but I disagree with those who do not agree with referendums—[Interruption.] Is the right hon. Member for Rotherham (Mr MacShane) still speaking? Shall I sit down?

[Mr MacShane]

indicated dissent.

[Laura Sandys]

The distrust over the Lisbon treaty has created a total and utter determination to put the people and Parliament back in control of our sovereignty, and to ensure that the public and the various views in both Houses are listened to and considered.

The Bill sets three clear triggers that will create sovereignty locks that will introduce a clear mechanism for referendums, the need for legislation or parliamentary approval. My constituency has one of the largest UKIP votes in the country—2,500 voted to get out of Europe—so I am very conscious that we need to be robust on Europe and that any further transfer of powers needs to be questioned. The Bill convinces me of our control over transfers of power, which is important.

Let us consider what will happen under the Bill. If any Government decide to propose any further power or competency transfer to Brussels, they will have to hold a referendum. If a Government decide on a transfer of responsibility to Brussels, and if they state that that is not a transfer of power or competency, they will have to justify their decision to Parliament. They will need to show that there is no change in sovereignty, and that there is no diminishment of our domestic laws. If they prove that no power or competency is transferred, they will come up against the second lock—they will require an Act of Parliament. Many hon. Members have very strong views on the EU and sovereignty, but that lock gives all of us the opportunity to vote against the proposals or to amend them, including to put them to a referendum. We therefore have the ability to call Ministers to account, and to vote on or amend legislation.

That is crucial, but I am not sure that many hon. Members see the opportunities that the Bill gives us to question the judgment of the great Ministers of State. For me that is a significant statement that makes it clear how power will be used and our relationship with the EU forged. It is important in terms of both substance and message. Unlike some of my hon. Friends, I believe that the substance is that the people will be able to sanction the transfer of power. The message is that Brussels now knows that the brakes have been put on any further power grab.

20:10

[Kelvin Hopkins (Luton North) (Lab)]

I was unable to be in the Chamber for the first part of the debate because I was detained on House business elsewhere. I came in to listen to some fine speeches—and I have certainly heard some—but I did not plan to speak myself. However, I have been provoked once again into saying a few words.

As I have said time and again in the Chamber, the European Union is not Europe. They are two separate concepts, one of which is a continent of countries that I love very much. I would wish to go nowhere else. Europe is my home—it is where my history is and where my ancestors came from. We are a group of splendid nations with wonderful histories, and we have made great contributions to the world. In contrast, the EU is a recent invention, a political construct imposed on the peoples of Europe, and not always with their consent. In recent years, there has been a drift towards a majority opposing the EU—the regular Eurobarometer test shows sinking support for the EU. The EU is not Europe; it is a political construct with which I have always had strong disagreements.

The Labour party makes the point time and again that those who oppose or are critical of the EU are of the right, and those who support it are of the left. That is strange, because it was actually the Conservatives who led us into the EU and the majority of the Labour party who opposed it in the 1975 referendum. I was the agent for the no vote in Bedfordshire, and a Conservative Member for a Bedfordshire constituency was the agent for the yes vote. I reminded him of that when I met him recently—he has passed away now—and he was horribly embarrassed because he had changed his view. I have not changed mine.

The referendums held recently in European nations have been won by my standards—lost by the standards of the Euro-enthusiasts—by people of the left, including trade unionists and working class people who did not feel that this machine would be to their benefit. That was true in France despite the leadership of the French Socialist party balloting its membership to get a yes vote. In Holland, again, it was trade unionists and people of the left who voted no; it was people who thought that some of the rights they had achieved in the post-war democratic world might be taken away by the EU. In Sweden, too, there was a referendum on the euro, and again it was the left who opposed it, because they could see that being bolted to a single currency would remove the flexibility that all economies need from time to time to be able to adjust.

I am broadly in favour of stable currency regimes, although not a complete floating currency rate. We had one after the second world war, between 1945 and 1970-ish, and it worked: we had full employment, growth, rising prosperity and greater equality than we had ever seen, and welfare states developed all over Europe. Somehow, however, we gave it all away, and now we have gone for a neo-liberal, free market view of the world with which I completely disagree and which has brought us close to disaster in recent years. I think that the social democratic world of Europe after the second world war was a good world and one that worked. That is why I so strongly oppose most of what the EU is doing. It is trying consistently to take all that away and to create a world of competition and free markets with which I do not agree. It has brought us close to disaster.

My record on opposing the single currency goes back a long way. In 1979, I worked as a research officer for a then trade union called NALGO. I wrote a brief on the “snake”. Hon. Members with long memories will remember the “snake”—the European monetary system—and whether we should join it under Denis Healey. I wrote a brief to our general secretary saying, “This will be a disaster. It’s the first step on the way to a single currency and will do us no good.” Geoffrey Drain, our then general secretary, went to the TUC, taking my brief with him, and he argued strongly against joining the “snake”.

The TUC then went to Denis Healey and again argued strongly against joining the “snake”, and he agreed not to join it. I am not sure whether it was just down to me, but we all agreed anyway. Subsequently, however, we made the great mistake of joining the exchange rate mechanism, which did the Conservative party no good, I fear. Had it not joined it and had we not suffered the depression, the negative equity, the housing market collapse and the rise in interest rates in 1992, or had it not been ejected from or left the ERM, it might not have lost the 1997 general election. That was the cause of its loss, and many Conservatives rue the day they were persuaded to support joining the ERM.

I opposed the ERM before we joined. I wrote a paper saying what would happen, and I was proved right—I said that the money markets would speculate against it and that it would break. That proved to be correct. Since then, I have opposed a European single currency. I was a founder member, with several good comrades on the Labour Benches, of a group called first “Labour against the euro” and now “Labour for a European referendum”. They consisted of the same people, including my hon. Friend the Member for Great Grimsby (Austin Mitchell), who made a fine speech today.

We now have the single currency, and the elephant in the room is the crisis in the eurozone. Members only have to read the Financial Times leader every day. I am not saying that the Financial Times is all-knowing and all-wise, but it is not yet convinced that the euro will survive. Indeed, sensible people are suggesting that we should be trying to find an orderly way to deconstruct the euro using these vast funds to do it in the most pain-free way possible. It might not be very pain-free, but at least it would be better than ploughing on into a massive crisis when things get out of control. Perhaps we need a controlled deconstruction of the euro for those countries that cannot sustain membership, and a new eurozone consisting of a smaller group of member states based around Germany, or indeed two or three different currencies for countries that can afford to work with each other.

Our former Prime Minister and Chancellor, my right hon. Friend the Member for Kirkcaldy and Cowdenbeath (Mr Brown), had the great wisdom to stay out of the euro in the late 1990s. I cheered him then because he was absolutely right, and has been proved to be right. Had we not been able to depreciate by 25% or so, we would now be in the same state as Ireland—but probably worse. Separate currencies are essential shock absorbers. They should not be used lightly. I do not agree with volatile exchange rates: we need stable ones, as we had after the war, with the possibility of depreciation from time to time, and indeed appreciation if a currency is undervalued. Germany’s currency, for example, was under-valued for a long time, which gave it a tremendous competitive advantage. The eurozone is the elephant in the room.

Sovereignty is important. I would like a stronger Bill than this one in which we can re-establish support for the democratic state and our own national sovereignty, not in a nationalistic way but because that is the basis of our democracy. I want the same degree of sovereignty for other nation states as well. I think that the nation state is the natural order of things, and trying to impose arrangements that bind nation states rigidly together will be fraught with problems and lead to disaster. I use this example time and again: Argentina effectively tried to join the dollar zone, and it almost destroyed its economy. In the end, it had to recreate the peso and devalue massively. Having been the strongest economy in south America, Argentina went through terrible times and still has not quite recovered. Single currencies imposed on different economies are always mistakes, and that is what has happened in the eurozone.

Edward Heath, when in opposition, sat near to where I now sit in the Chamber. He argued strongly against enlargement—I am not suggesting I agreed or disagreed with him—because he thought that countries that were too different would not be able co-operate within the EU.He wanted to stay in a smaller group of richer, western European nations. That is what Edward Heath was in favour of; he was not in favour of the much larger organisation that is now developing, involving countries with very different economies and, indeed, different traditions. He will perhaps be looking down with interest from wherever he is now and saying, “Well, I was right after all, wasn’t I?” It does not work if we try to impose things on very different economies.

Those are the points that ought to be borne in mind, and the major problem that the European Union has at the moment.

20:19

[Mr James Clappison (Hertsmere) (Con)]

It is a great pleasure to follow the hon. Member for Luton North (Kelvin Hopkins). The sentiments that he expressed—a feeling of disconnection with the European Union, concerns about its lack of accountability, and even a feeling of crisis in the European Union—are ones that we have heard throughout this debate. That is not something that has been invented by parts of my party or got up by the press; it is a deep-seated feeling across parties and among voters of all parties.

To be fair to those of my party on the Front Bench, they tried to respond to that in the general election. It was no doubt with concern about Europe in mind that they made the following promise, which they were right to make, in the manifesto, on which I was proud to stand, just as every other Member of my party did:

“We will be positive members of the European Union but we are clear that there should be no further extension of the EU’s power over the UK without the British people’s consent…We will work to bring back key powers over legal rights, criminal justice and social and employment legislation to the UK.”

That was described in the Conservative manifesto as a liberal Conservative policy, and it is indeed in accordance with the tenets of classical liberalism. However, since then we have actually had a Liberal-Conservative policy.

I understand that, and I understand the reasons why it has come about. However, I am sure that my right hon. and hon. Friends will understand when I say to them that although I appreciate the fact of the coalition and the way in which it is working, I still hold to what was said in the manifesto, which I supported, and that I wish to accomplish the ends of that manifesto, particularly in respect of not allowing the extension of any further power to the EU, as well as repatriating existing powers—I thought that that would be a tall order, but it was worth trying. It is certainly still in order to seek to prevent any further extension of EU power. However, I am afraid that the Bill as it stands does not fully accomplish that end, and my hon. Friends would be testing my credulity if they claimed that it did.

Indeed, clause 18 does not even seek to do that. This is a matter of academic debate, but clause 18 is a restatement of the existing position—there are different academic views on that—and it certainly does not set out to stop any further transfer of power to the European Union. Nor, I would suggest, do the other parts of the Bill fully accomplish the end of preventing a transfer of power to the European Union, however many referendum locks they contain, particularly in so far as they concern transfers of any further competences to the European Union. If one studies the list of competences that are already possessed by the European Union, as set out in the treaty of Lisbon, one can see that virtually every field of policy—indeed, every type of human activity—is covered by a competence of one type or another. Even where those competences do not give the European Union a law-making power—and in many cases they do—the European Union can still use the competences that it holds in other fields to make law and policy in those fields where it does not have a formal competence, and the European Commission, backed up by the European Court, has not been slow to do that.

The problem that we are faced with is that which the hon. Member for Vauxhall (Kate Hoey) described earlier: the drip, drip, drip of power to the European Union, through European directives, European regulations, all the soft law that comes from the European Union, and the new objectives that are set for the European Union, which influence policy makers. All that goes on as before. As far as the European Union is concerned, it is just business as usual. Those are the problems that we need to address, and although it is difficult to take them on, I would urge Ministers to do so.

Already in the lifetime of this Government we have seen transfers of power to the European Union that—I think I am right in saying—would not have been captured by the Bill’s referendum provisions. Most people would understand a transfer of power in any ordinary sense to include giving the European Union power to set policy, or giving the European Commission the power to take initiatives or, most particularly, to make law. I am thinking in particular of the advent of the External Action Service, which has attracted so much bad publicity in this country. However, the External Action Service is bad for this country not just because it is extravagant—although it clearly is—but because it will act in such a way as to supplant British power and the exercise of independent British representations. I suspect that this is something that we will see more and more of in times to come.

We have also seen the Van Rompuy report on economic governance, which most people would see as a prospective transfer of power, in any ordinary sense of the word, to the European Union, framing, as it does, the criteria by which our economic policies are made and the guidelines that Governments must observe in their fiscal policies. The report also gives the European Union the power to impose sanctions on this country, in the form of placing it under certain procedures—not financial sanctions, but sanctions of other forms, which could be influential with policy makers. The report is certainly intended by the European Union to be an instrument of economic governance over this country, even though it is not a member of the eurozone.

We have also seen a significant transfer of power into the European so-called area of freedom, security and justice, caused by opting in to directives of the European Union in that area, even though this country had an opt-out from those policies—something that the previous Government said was the key difference between the constitutional treaty and the treaty of Lisbon. Now we are seeking to opt in. We have already opted in to six directives—two are very significant directives indeed—that give the European Union legislative authority over this country and, more importantly, give the European Court of Justice jurisdiction over our criminal procedure and criminal law. Those are all matters that are not covered by the Bill as it stands.

[Mr Cash]

Does my hon. Friend agree that this road map contains an almost continuous tsunami of arrangements of the kind that he has described, and that the net result is that we are going further and deeper into Europe the whole time, instead of the other way round?

[Mr Clappison]

I am afraid that my hon. Friend is correct. We are deepening and extending the jurisdiction of the European Court of Justice.

What to do about all this? There is one improvement that can be made to the Bill—an improvement that I put to my right hon. Friend the Foreign Secretary. It would be a great improvement on the Bill, and would be in keeping with what we have been saying about parliamentary democracy, if we made the exercise of the opt-ins subject to a vote in this House—something that does not take place at the moment, however heroic and detailed our efforts at European scrutiny are, as we cannot cause this House of Commons to have a vote on something of that nature. That would be easy for Ministers to agree to, and I cannot think of a good reason against it. My right hon. Friend said, “Well, there might be too many of these things,” which rather bears out the point that my hon. Friend the Member for Stone (Mr Cash) just made about the extent of the penetration of the European Union’s jurisdiction. However, the fact that things might take up too much of the House’s time is not a sufficient reason not to have a vote—perish the thought!—on such matters. I remind my right hon. and hon. Friends that we specifically promised in our manifesto to allow Parliament more time to scrutinise legislation. My proposal would be in keeping with that, which would be a good thing.

It would also be appropriate for Ministers to consider amendments to the provisions dealing with the question of significance, because at the moment, whether we have a referendum under the circumstances detailed in the Bill depends on whether Ministers think they are significant enough. What a thing! Ministers are to decide whether something is significant enough, and the explanatory notes to the Bill then tell us that anyone who is aggrieved by such a decision should go off to the courts to seek a judicial review. What on earth is Parliament for? Are we not allowed to hold Ministers to account as well? Are we now going to have to subcontract that to the courts?

[Kelvin Hopkins]

This reminds me of when, late in the progress of the Freedom of Information Bill, a clause was suddenly introduced that stated that there could be freedom of information unless a Minister said no. It was to be left to the discretion of a Minister whether something could be covered by freedom of information legislation.

[Mr Clappison]

This is a test for my right hon. and hon. Friends, and I hope that they will listen to the case for certain amendments. I hope that, rather than seeking to drive the Bill through unamended, they will try to improve it. I believe that we can do that by building on what is already in it and, in so doing, restore the authority of this House. That is what this is really all about. We need to restore the authority of the House, because our right to self-governance and our parliamentary sovereignty have been systematically stripped away by the European Union over the years. So far, everything that has been described as a safeguard to prevent that from happening and a solution to the problem has turned out to be false.

First, there was the promise that we would have voting only by unanimity. That was the original promise in the literature delivered to every household when we originally went into the European Union. Then we had the pillar structure, which has long since crumbled to dust and become part of the main European structure. We then had the pledge of subsidiarity, but we do not hear so much about that these days. I remember being told, during the passage of previous Bills 10 to 15 years ago, that subsidiarity was going to be the solution to the problem, but nobody talks about it now. The only example of the exercise of subsidiarity by the European Commission has been in relation to the zoos directive, so I am pleased that at least some of our fellow creatures have benefited from the doctrine of subsidiarity.

I hope that this Bill does not go the same way as all those other failed attempts to solve the problem, in which Ministers have gone around saying, “This is the solution. We do not need to worry any more about Europe. There is no problem about the constant transfer of powers to the European Union—we have put a stop to it.” Rather than simply seeking to drive the Bill through the House of Commons, I hope that Ministers will listen to the case for improving the Bill with properly tabled amendments. We could make this a better Bill but, as things stand, we have the continuing problem of parliamentary self-governance being stripped away by the European Union. I do not want to say that we have hung up a sign that says “Business as usual” to the European Union; I hope that we can do a bit better than that. Certainly, as far as the transfer of new powers is concerned, we should put up the “Closed” sign to the European Union.

20:31

[Mr Bernard Jenkin (Harwich and North Essex) (Con)]

As far as the term “business as usual” is concerned, I must ruefully reflect that it is business as usual in this House, as we are again discussing this interminable topic. It has occupied many thousands of hours of discussion since I was elected in 1992, and many thousands more before that. It is perhaps amusing and depressing to see how little some things change while the pace of European integration seems uninterrupted by whatever votes take place, whatever arguments occur and whatever crises erupt. The present crisis over the governance of the euro is a case in point. The architects of the Maastricht treaty, far from accepting that they have been proved wrong by events, are seizing on the chaos to strengthen the hold of the centre over the rest of Europe, accelerating the pace of integration as a result.

I am bound to ask, as should we all, whether the scene that we observe in the Chamber today was really what my right hon. Friend the Foreign Secretary envisaged when he came up with the brilliant idea of a referendum lock at the Conservative conference in 2009. At that time, I think what he saw looming was the imminence of the ratification of the Lisbon treaty, and the difficulty of holding a referendum on a treaty that had already been ratified. He was looking for something to throw to the crowd, and his idea got a wonderful round of applause at the conference. Little can he have imagined, however, that that simple promise would give rise to a Bill of such byzantine complexity. It has not been universally welcomed in the Chamber, although, knowing the way in which this place works, I suspect that it will find its way into Committee. No one, with the exception of a few aficionados, can have imagined what a mess the future Government were getting themselves into by making such an apparently simple pledge. As recently as 1 November, the Prime Minister told the House:

“I would grant a referendum if there were any proposed transfer of powers from Westminster to Brussels.”—[Official Report, 1 November 2010; Vol. 517, c. 625.]

My hon. Friend the Member for Hertsmere (Mr Clappison) made an illuminating speech, pointing out that certain transfers of power are not included in the Bill. The reason why they are not included is either that the Government have already made those transfers and do not want to admit that they should have been made more accountable to this House, or that they intend to make further transfers and do not want to get caught up in the potential for litigation. I would be grateful if my hon. Friend the Minister for Europe made it clear in his summing-up speech when he expects the provisions to come into force. My understanding is that whatever is in this Bill is not intended to apply to this Parliament, but to the next one. I see the Minister nodding. It would be a bit embarrassing to legislate for the next Parliament and create a trap for a future Government that the current Government would not accept for their own behaviour. I guess that that is why these lacunas exist.

The crunch is that it all depends on what is meant by power. A child can have power over its parent, even though it does not have any sovereign or legislative authority. Power has a fluid quality to it: it cannot be held; it travels to people with influence. Power is clearly leeching away from our kingdom and this House, even though I believe that this House remains absolutely sovereign. The fact of power, where it is exercised, and the constraints that it makes people feel when it is exercised, is clearly having an effect.

Two simple tests can be applied to the Bill. The Foreign Secretary himself says that the Lisbon settlement lacks democratic legitimacy, so we should ask ourselves whether this Bill adds to the democratic legitimacy of the settlement between the United Kingdom and the European Union. The answer is that it does not affect it. It affects what might happen in future—we can argue about that, and some argue that it might have a greater effect than expected and that the courts might have to decide how much effect it will have—but it does not constitute a lock, as my hon. Friend the Member for Clacton (Mr Carswell) pointed out, because no Parliament can bind its successor. Whatever is in the Bill can be amended or repealed by a future Parliament. It is not really a lock, but it does not affect anything that has gone before.

The sovereignty clause provides another case in point. In fact, despite the Government’s repeated reference to it as such, it is not a sovereignty cause. It does not contain the word “sovereignty” or “sovereign” and it does not use the words “supremacy” or “primacy”. It merely provides an historical account of what happened—that there was an Act of Parliament, which is how the European Union’s laws apply in this kingdom. It has no effect whatever.

Let me cite the evidence given to the European Scrutiny Committee. Professor Adam Tomkins gave advice that was accepted by the all-party Select Committee. He said:

“Neither clause 18 nor any other provision in the Bill safeguards the United Kingdom from the further development of EU law by the ECJ.”

Now the ECJ, that really is power! How is this House going to regulate the power of the European Court to expand competence and reinterpret the competences of the European Union as it has done down the ages? Well, of course, it cannot. I was touched by the faith in the Bill expressed by my right hon. Friend the Member for Charnwood (Mr Dorrell), but as Professor Tomkins also said on the limitations of clause 18:

“If this is the attempt by the UK Parliament to reassert or reclaim some kind of sovereignty in the face of the European competence creep, it ‘don’t do what it says on the tin.’”

I am afraid that the Minister has to face that.

In my last minute or two, let me move on to the second test of the Bill. Is it really in the national interest; does it address the national interest? I would regard the Bill as almost wholly irrelevant to the national interest. The hon. Member for Ilford South (Mike Gapes) pointed out that we should be talking about the rise of China and how we are going to do business with India. We really are contemplating our navels as we discuss this Bill. As the recent Public Administration Committee report says, what we need is a reassessment of our national interest with regard to our membership of the European Union. I do not advocate an “in or out” referendum, but I think that we need to start reassessing whether our current terms of membership are in our national interest and then to start working out how we should alter them to reflect our national interest.

The problem with this Bill is that it neither addresses the democratic legitimacy—or the lack of it—in the current settlement, nor stops the flow of power to the European Union. As we are talking about democratic legitimacy, I should say that that flow takes power away from democracies and gives it to something else, because whatever the European Union is, it ain’t a democracy. The Bill fails to address our national interests and it reflects the muddle that the Government have got themselves into because, as we have heard, the prime purpose of this Bill is political; it was designed to appease sentiment in the absence of a referendum on all the treaties where we should have had referendums: the Maastricht, Nice and Amsterdam treaties, as well as the Lisbon treaty. The Bill will fail to reassure people and will fail to address the increasing disconnect that people feel, not from the European Union, but from the governance of their own country by their own democratically elected representatives. Dealing with that is the real challenge that we face, because that is about despair about us in this place.

[Mr Deputy Speaker (Mr Lindsay Hoyle)]

Before I call the next speaker, may I say that I am trying to get 11 Members in and I presume that the Front-Bench spokespeople will want 15 minutes each? We can work the sums out for ourselves, but I ask for a little haste and for hon. Members not to take as much time.

20:41

[Martin Vickers (Cleethorpes) (Con)]

I shall be as brief as possible, Mr Deputy Speaker. You will be pleased to learn that I have already crossed off my list a few points that other hon. Members have made. A short while ago, I heard a speech given by my own Member of Parliament, the hon. Member for Great Grimsby (Austin Mitchell). He and I have shared common cause in our fights against the EU over the years, and only a few weeks ago we marched through the Lobby together saying, “North-east Lincolnshire against Europe.” He opposes this Bill because he says that it does not go far enough, but I am going to support it because it goes some of the way towards what I would like to see. I am no friend of the EU.

We were given a bit of a history lesson by the hon. Member for Luton North (Kelvin Hopkins) a short while ago. He was reminiscing about his part in the 1975 referendum and I, too, am sadly old enough to have participated in that campaign. Hon. Members will recall that my party was very pro-European at that time, and I must tell the House that I was a rebellious young Conservative who drove around with “No to the Common Market”—as it was then—on my battered Austin 1100. For many years I would have described myself as “anti-European”, but I would now say that I am “a Eurosceptic”. One can go on fighting the same battles for only so long. I concluded some time ago that the only Governments likely to be elected were going to be Conservative, Labour or some combination involving one of those two and the Liberal Democrats. Being realistic, none of those were going to achieve what I would like to see, which is withdrawal from the EU. That may change and I hope it does, because I agree with the earlier comments that the nation state is the natural unit of government—long may that continue.

However, we are where we are. I speak for my constituents when I say that, in general, they are very much opposed to EU membership. Grimsby and Cleethorpes are geographically one town, although they have their own identities. The scars from the fishing negotiations run deep, and we recognise that Mr Heath’s Government sacrificed the deep-sea fishing industry in those negotiations in the early 1970s. On membership, an instant reaction among my constituents would almost certainly be, “We want out.” Perhaps the more reflective view might be, “We might just about get a majority to stay in.”

The big failing of successive Governments has been their reluctance to secure popular support—preferably, in a referendum—for the various treaties and moves towards more integration. We would probably still be in exactly the same position, although a week or two ago I discussed this matter with my hon. Friend the Member for North East Somerset (Jacob Rees-Mogg) and he pointed out that we might have got a “no” result in a referendum on Maastricht. We need to correct the mistakes of the past and repatriate more of our powers, and I hope we will make some moves towards that in the not-too-distant future.

The Bill talks about “significant changes”, so I acknowledge that we shall have endless dancing on a pinhead and legal decisions about what is “significant”. In an ideal world, I would go further than the Bill, but the important thing is that if in future, if Governments wriggle, duck and dive in their interpretation in order to avoid a referendum, they will suffer the same fate as the previous Government, who argued that a constitution was not a constitution and were discredited in the eyes of the public.

We should accept the fact that the EU is a political project. There is nothing wrong with that, but I do not happen to agree with the destination of the project. Ultimately, irrespective of any court decision, a decision about whether we remain in or leave the EU will be a political one.

The Bill as it stands is not perfect. I would like it to go further, but it is better than nothing and I shall certainly be in the Lobby to support the Government.

20:46

[Jacob Rees-Mogg (North East Somerset) (Con)]

I, too, will support the Bill at this stage, although I was deeply concerned by what my hon. Friend the Member for Harwich and North Essex (Mr Jenkin) said about its not being introduced, for the main part, until after this Parliament has been completed. If that is correct—I hope the Minister will give us some comfort on that point—the whole of this exercise is entirely pointless.

[Mr Jenkin]

The Minister nodded at that point in my speech, and I accepted that as an indication of assent.

[Jacob Rees-Mogg]

rose—

[Mr Lidington]

May I make it clear that I nodded to indicate that I would respond to my hon. Friend the Member for Harwich and North Essex (Mr Jenkin) in my concluding remarks?

[Jacob Rees-Mogg]

I would not wish to anticipate the excitement that we all hold for the Minister’s speech on that crucial point.

The Bill is important and broadly good. Let us be absolutely clear that there are many of us on the Government Benches, and on the Opposition Benches, who want powers to be brought back from the European Union. The European Union is a state in decay. It is rotten at its very core. It is corrupt. It is dishonest. It is bullying. It has a currency that is failing as I speak, a currency that is bankrupting several of its nations and putting ruinous conditions on Ireland, Portugal and Greece—and the Spanish and the Italians will follow.

The European Union has not been in British interests. It is not the common market that people expected it to be and we need root-and-branch reform. I know that we are in a coalition and that we have made concessions to our coalition partners, as they have made concessions to us. They have not yet realised how dreadful the European Union is, but as one hon. Member said to me earlier, “The more they get to know about it the worse they will know that it is.”

Let us look in detail at this Bill and at why it is welcome as far as it goes. The element on the referendum is very important and I was delighted that Vernon Bogdanor, the extremely distinguished constitutional historian, quoted John Locke in his evidence to the European Scrutiny Committee. My delight is all the greater because John Locke grew up in Belluton, which, as right hon. and hon. Members know, is a village in North East Somerset. John Locke said in his “Second Treatise of Government”:

“The Legislative cannot transfer the power of making laws to any other hands. For it being but a delegated power from the People, they who have it cannot pass it to others”.

That is the essence of our constitution.

People talk learnedly about the sovereignty of Parliament, but what do they really mean and where does it come from? I think this was all settled in the 17th century. There were two choices: one was that sovereignty came from God and was given to the King, and the other was that it came from the people and moved upwards and that it was borrowed by Parliament for a period. The sovereignty of Parliament is a great thing. We should bear in mind that the Supreme Court is established by Parliament, as are the very monarchy and the laws of succession. That precious sovereignty is ours not because we are the great and good of the land, or because we sit on green Benches in a fine Palace, but because the British people have given it to us for a period, and we may not bind it or give it away. We may not give it to Europe or the United Nations; only the British people can do that, and they must have a referendum lock on it.

We heard a characteristically well-phrased speech from the hon. Member for Rhondda (Chris Bryant). He was concerned that the Bill would not provide a lock because it could be repealed by subsequent Parliaments. That is true, of course, but a lock can be unlocked if one has the right key, and the key will be the considerable political capital that would be expended by any Government who wished to remove, dilute or give away the power of the sovereign British people. So, the lock is worth while. There has been an interesting development in law about constitutional Acts having a higher standing than ordinary Acts, and the European Communities Act 1972 is considered to be such an Act, as Lord Laws mentioned in the Thoburn case. If that is right, I hope we will get some guidance from Her Majesty’s Government on whether the Bill would be a constitutional Act that could not be subject simply to implied repeal but would have to be repealed directly. The referendum lock is important and beneficial even though it is not enough in terms of our relationship with the EU.

Clause 18 affirms the sovereignty of Parliament and provides that we allow European law to take effect only because of the 1972 European Communities Act. I welcome the clause, but it was a matter of great dispute among much more learned people than me during the European Scrutiny Committee’s deliberations. I welcome it because of the nature of our constitution, which evolves without things necessarily being written down. We discussed this issue during Committee deliberations on the Fixed-Term Parliaments Bill. There are things that the sovereign could do by royal prerogative that are so unlikely and improbable, because they have not been done for so long, that they have fallen into disuse and effective decay. My worry is that without this clause, the 1972 Act might be viewed as one that cannot be amended or repealed and that we might get to a stage, perhaps in 50 years’ time, when the courts hold that it is so important that it is of a different order of magnitude than any other statute.

Clause 18 turns the clock back, which is rather gratifying because we are told that the Tories never turn the clock back. Evelyn Waugh said that he voted Tory all his life expecting them to turn the clock back but that they did not put it back 10 minutes. On this occasion, we are putting it back by 38 years; we are resetting the constitutional position to where everyone would have known it was in 1972. I think that is important, even though I thoroughly accept the point made by many right hon. and hon. Members that it is not a complete statement of the whole theory of the sovereignty of Parliament. I hope that would be unnecessary because the sovereignty of Parliament comes from the British people and cannot be taken away, however much one says so.

20:55

[Nick de Bois (Enfield North) (Con)]

I am privileged to follow my hon. Friend the Member for North East Somerset (Jacob Rees-Mogg), who does justice to the House, as he does justice to the sentiments that he expressed and the cause to which he spoke. That makes it harder for me to follow him. I realise that that is usually a challenge for Members, but I will do my best.

I echo my hon. Friend’s sentiment and I will support the Bill because I regard it as the first serious attempt to stop the erosion of power from Westminster to Brussels. I say “serious” because it is legislation before the House, and I say “attempt” because I recognise that it does not go as far as I and other Members might like. EU interference has dogged us for many years. We as a sovereign nation have been bled dry of powers, which has increased the frustration of the public with an institution that is so remote yet so influential on their lives.

I support the attempt to introduce a referendum lock. For too long, the people have been sidelined as dodgy deals are done and negotiated across Europe, stealing our sovereignty. How? It has been done through treaties such as Lisbon, Amsterdam and Nice. The previous Government handed over so many of our powers during the past 13 years. When the former Prime Minister, Tony Blair, said that he wanted to be at the heart of Europe, he was not kidding. He effected one of the most powerful transplants ever of so much power to Europe from Britain. We all sensed the betrayal that the British people felt as a result of the Lisbon treaty.

The Bill moves to give Parliament more say over Europe. The Government will have the opportunity to pass primary legislation before we have more self-amending clauses. There is good stuff in the Bill. As for sovereignty and clause 18, I know that there are many learned Members in the House and I dare not question their judgment, but when lawyers say to me that something is enshrined in common law, I am immediately concerned that common law and precedent mean that it could change over time. I have no problem with an attempt to establish clause 18, but I acknowledge, as my hon. Friend the Member for Stone (Mr Cash) said, that it carries some risk with lawyers in the future.

My main concern is that the Bill may be seen as the end of a process, rather than as the beginning of a process to ensure that the present or any future Government cannot continue to transfer powers to the EU. My hon. Friend the Member for South Dorset (Richard Drax) spoke eloquently of wiggle room. There is wiggle room in the Bill, and that is not good because we are attempting not just to pass a Bill, but to rebuild trust between the British people and the Government by challenging the transfer of powers in our relationship with Europe.

The existence of wiggle room raises the question of who decides what is material and what is not. Ministers clearly have the right to determine what constitutes a transfer of powers, and mechanisms spelled out in the Bill make it clear in many cases what constitutes a transfer of powers, but it is the little grey areas of wiggle room that are, in effect, a Trojan horse that can be exploited and undermine the genuine attempts of the Bill to protect any transfer of power.

I tried to apply a test. Had the Bill been in place when the European arrest warrant was introduced, would we have had a referendum on a significant directive from Europe? I attempted to find out. I am grateful to the Minister’s staff, who spent some time briefing me on the Bill. I raised the question, but I have to say that I am still confused—not because of their lack of effort, but because of the potential greyness surrounding the issue.

What is more illustrative of our sovereignty than the fact that the courts in an individual’s own land cannot protect him, but could lead him to be extradited merely by ticking boxes in a process and undermining the right of a British court to pass judgment on him?

The Minister knows that, until recently, one of my constituents, Andrew Symeou, languished in jail for many months after being subjected to a European arrest warrant, and the Minister is kindly trying to make representations to the Greek Government to assist him. The family keenly await any outcome, and I thank him for that. But my constituent would believe that the sovereign power of his country had not served him well by agreeing to transfer those powers outside the jurisdiction of our courts and to Europe. I think he would say that his Government had not protected him.

Will the Minister look closely at the wiggle room in the Bill and see how we can reconcile the conflicts that no doubt will lead to other issues over transfer of power? Yes, of course, issues can come to Committee, to scrutiny and to Parliament, but ultimately a Government can get their way, and however much we may protest, a Government may get a motion through and the people will not have had their say in a referendum on a transfer of powers.

I sympathise with my hon. Friend the Member for Clacton (Mr Carswell) when he suggests that we may be shutting the gate after the horse has bolted, but on balance that would not be a reason to oppose the Bill, because it marks a massive step forward for Britain and her relationship with Europe. It is a confidence-building measure for the British people in their relationship with what can only be described as an empire-building EU, and it is an important marker in the sand for this coalition Government to rebuild trust with the British people. We must not breach that trust.

Decisions have been remote from the British people. Yes, Parliament does have more say. I accept that the Bill only draws a line under the past, but it still leaves the future somewhat grey. It could be tightened further, and that is in the interests of constructive engagement, which I hope we will have the chance to debate at length in Committee, but I have no hesitation in supporting it, and I believe that my constituents will also seek to take advantage of engaging in future European debate if they have the opportunity to have their voice heard should the Bill be enacted.

21:02

[Chris Heaton-Harris (Daventry) (Con)]

I rise as a sinner, because I would like a referendum on Britain’s future relationship with our European partners. As I am a former member of the European Parliament, that certainly makes me a sinner in the eyes of those out there. Many of the British people are sinners also. We all entered this European garden of Eden fully clothed, and now the British people feel that their clothes have been stolen by previous Governments of both colours, with their shirt finally having been stolen from their back by the last Labour Government when they gave away a huge part of our rebate. That is why we have the Bill.

It is fairly obvious to anyone who cares to ask our voters that they are really fed up with our relationship with the EU, and do not trust the European institutions. Equally, our voters have lost a huge amount of trust in the ability of British Governments trying, or even endeavouring to try, to stand up for our country.

[Mr Swayne]

This House voted not to have a referendum on the Lisbon treaty. If those of us who argued with the Minister, who continued to insist that it was merely an administrative tidying up, had only had the ability to go to judicial review, as this Bill allows, we would have been much better for it.

[Chris Heaton-Harris]

That is why the Bill is very important, and equally why it is dangerous to oversell what the Bill does.

Government Members have a number of qualms, as do Labour Members, about the sovereignty clause. Vernon Bogdanor, in his evidence to the European Scrutiny Committee, said:

“Although there is therefore a basic rationale for the European Union bill, it seems to me that its provisions are inconsistent with the declaratory clause insisting that Parliament is sovereign. Indeed, the purpose of the bill is unclear to me. A government will not provide for a referendum unless it wishes to support a proposal for treaty amendment or transfer of powers. If it is opposed to such a proposal, it can use its veto, since all matters to be made subject to the referendum require unanimity. The present government has indicated that it will not support any amendment or transfer of powers in this parliament. Therefore, the purpose of the bill must be to prevent a future government from supporting such an amendment or transfer without a referendum. The bill seeks, in other words, to bind a future government. That seems to me inconsistent with the declaratory proposition that Parliament is sovereign.”

I should very much appreciate the Minister’s thoughts on that piece of evidence.

The Minister kindly came to the European Scrutiny Committee yesterday and gave a tour de force on the outcomes that he expected from the Bill. He said that

“it delivers on what was in the coalition programme simply as an agreement to consider the case for a sovereignty Bill—that Bill is being introduced by the means of clause 18.”

Yesterday, at the end of his speech, that was reduced to just a few words:

“Clause 18…is declaratory in intention and in substance.”

May I suggest to the Minister that he must not oversell that clause? There is some value in clause 18 as a declaration, but it absolutely does not represent a sovereignty Bill.

My hon. Friend the Member for Hertsmere (Mr Clappison) made some salient points about justice and home affairs measures, which are a good example of what goes on in the European institutions. The Bill seemingly stops powers heading out to Europe in big chunks, but anyone experienced in such matters knows that European negotiators rarely try to swallow their prey whole. They would if they could, but to get past the public anger and angst that such huge transfers of power always cause they have long preferred to chop things up and to salami-slice: they chop away piece by piece, or sliver by sliver, until they reach their goal. Current justice and home affairs arrangements on the opt-in, opt-out basis receive little scrutiny, and the measure before us really put its finger on that.

The European public prosecutor, which is one of those proposals that triggers all the alarm bells in the Bill, simply cannot be introduced under this legislation without a referendum or the people having their say, but the European institutions desperately want it. As a member of the European Parliament, I was there at the start of the EPP debate in Brussels, and it evolved a little like this. Initially, the proposal was about introducing a common body of law in justice and home affairs, but it was not that important; it was just about protecting the Commission’s raising of its own resources. The Commission raises money in many ways, one of which involves VAT, and one role of the anti-fraud office, OLAF, was to ensure that money did not disappear through theft, fraud or VAT avoidance. OLAF was meant to police the Commission’s budget when the wise men set it up, but that story is for another day.

Let us say that OLAF did its job properly and got the authorities in Spain to arrest a British national for not paying VAT on smuggled cigarettes in Bulgaria. It is complicated to get all those authorities to investigate and co-ordinate arrests and prosecutions, so, the argument goes in Europe, we need a European arrest warrant, investigation orders and a whole lot more to make the process work. Before we know it, we have, through various justice and home affairs instruments, all the guts and the body of a European public prosecutor. Its creation would trigger a referendum under the Bill.

Can a current Minister, however, guarantee that a future Minister will not see that measure as a tidying-up exercise, or as just an insignificant power transfer with a European public prosecutor at the end? Can a current Minister guarantee what a future Minister will think is significant? Even if they are able to, will we get the British public to trust a Minister who says that? Not too long ago, a Minister for Europe suggested that the European charter on fundamental rights was of no more significance than The Beano. The Bill is for future use—not much good if no Government can bind their successors. But we are told that we do not need to worry about this Government, as under them there will not be any transfer of power to Europe.

Yesterday, when giving evidence on the Bill, the Minister for Europe told the European Scrutiny Committee—this was confirmed today by answers to questions that my hon. Friend the Member for Hertsmere asked the Secretary of State—that up to 40 justice and home affairs measures might be passed through the channels of Government in any given year. That is an awful lot. The Secretary of State said that those could take time to investigate. Yesterday, the Minister told us that

“there is a strict time limit attached to our opt-in on these measures—that we have to take a decision within three months. It takes the Government, through interdepartmental consultation, some time to work out what their own assessment of a particular measure is once it is published.”

That causes a problem, because it means that there is no time in the parliamentary timetable for us to investigate those measures properly.

What does the Bill do? It might not tickle the fancy of my fellow Eurosceptics, but I am sure that, when looking at the next area of policy from which to grab power, the Commission negotiators will have at the back of their minds a worry that at one point the British people might have a say about what they are trying to do. As has been described in so many books, they knew in the past that a friendly chat with close friends at the Foreign Office could mean a little less excitement down the line.

At the beginning of my remarks, I described how the British public and British politicians had entered the European garden of Eden fully clothed, only to find that over a period of years we had been stripped. Although I appreciate that the Bill is just a fig leaf, I will happily vote for it because it covers a tiny piece of our modesty.

21:11

[Neil Parish (Tiverton and Honiton) (Con)]

I very much welcome my right hon. Friend the Foreign Secretary’s Bill. Like my hon. Friend the Member for Daventry (Chris Heaton-Harris), I spent 10 years in the European Parliament. [Interruption.] Yes, I sinned too; tonight is a night of confession.

Seriously, over those 10 years we saw powers being transferred from the House to Brussels. I saw Tony Blair negotiate an increase in the budget of the European Union and give away part of our rebate, worth billions of pounds—and what for? A so-called reform in the common agricultural policy further down the road. Of course, when we got further down the road, there was no reform of the CAP; by then, the European Union had the money and was moving forward.

It is absolutely right that we should have this sovereignty Bill to curb the powers of the European Union. The people of this country are absolutely fed up of with a one-way street from Westminster to Brussels. That is why the Bill is so important.

Yes, the Bill probably does not go as far as many of us would like, but at least we are stopping the flow. It is no good for shadow Ministers to wind us up by saying that the Bill is just to placate the Eurosceptics. I suggest that if the Labour party had been a bit more Eurosceptic when it was in power, we would not be in this position now. The Lisbon treaty was basically the European constitution, but wrapped in different wrapping paper. However, because of that, the Labour party said that we would no longer have a referendum on it and the people of this country were denied one.

Now is the time to support the Bill and bring powers back. Provisions such as the social chapter, to which Tony Blair signed up, have brought all the working time directives and all the bureaucracy that ties up our businesses and stops us going forward as an economy. In time, after this, all those things will have to be pulled back to make sure that, in the end, this Parliament is sovereign and that we are not dictated to by Brussels.

21:13

[Priti Patel (Witham) (Con)]

The significance of the Bill cannot be ignored. I say that following the disgraceful way in which the previous Government and Members on the now-empty Opposition Benches denied the British public a referendum on the Lisbon treaty. I desperately hope that this Bill will reassure my constituents and the rest of the British public that that will never happen again. I congratulate the Foreign Secretary on bringing forward the Bill in the Government’s first year in office. It has been a long time coming, and it is a positive step in the right direction. However, a number areas in the Bill need to be strengthened to defend the interests of the British and truly guarantee the sovereignty of this nation. We have already heard some of the arguments on that this afternoon.

The Bill needs more clarity over exactly what transfer of powers would trigger a referendum. It needs to go further in guaranteeing our red lines and in demonstrating a full commitment to repatriating powers from Brussels. It also needs to enhance the transparency and accountability of anything that involves the EU. As it stands, there is considerable uncertainty about how the Bill will function in practice.

I would like greater clarity in the exemptions referred to in clause 2 and the significant condition mentioned in clause 3. Clearly those provisions offer a Minister what I call a get-out-of-referendum-free card. I do not believe that any Conservative Minister in the current Government would seek to pull the wool over the eyes of this Parliament and the British public by abusing that clause. However, let us not forget that it was not so long ago that this country had a pro-European Government who were blinded so much by the taxpayer-funded propaganda of the European project that they neglected the British interest.

Under the previous Government, the rebate was sacrificed and power was scandalously surrendered under the Lisbon treaty. Even with the referendum lock outlined in the Bill, it remains possible for a future Government to hand more powers over to Brussels through the back door. Clause 3 states that an Act could be passed by Parliament—thereby bypassing the need for a referendum —by stating that the transfer of powers was “not significant” in its impact on the United Kingdom. That is a highly subjective test that would be based on the recommendation of Ministers.

Some of the EU’s areas of exclusive competence and shared competence are so worryingly generic that it would be a legal minefield to assess which policies may require a referendum. We have already seen the controversy over the European investigation order. On justice and home affairs, we may be guaranteed a referendum on the establishment of the European public prosecutor, but there is no such commitment given on the actions that Eurojust could take.

What would happen if a future Government decided to give up the 12 and 6-mile fishery limits? Under the Lisbon treaty, the EU already has competence for fisheries and marine biological resources. If proposals come forward from the Commission to remove or amend the controls that Britain can currently exercise within those limits, that could be done without the British public having a vote. Our fishing communities would be left devastated if the regulation was revised to remove the limits. However, there is no guarantee that the limits would be protected by the referendum lock.

It is also possible that, over the course of a Parliament, a Government could transfer a number of powers that individually may not be perceived as being significant enough to warrant a referendum but that, taken as a whole, could be highly significant over a period of time.

[Ms Louise Bagshawe (Corby) (Con)]

My hon. Friend is making an excellent speech and is raising a number of excellent points. I particularly agree with her on the issue of salami-slicing, which was mentioned by my hon. Friend the Member for Daventry (Chris Heaton-Harris). Does she agree that it is absolutely necessary for the language to be tightened up in Committee, given that the previous Labour Government were able to come to this House and state that the Lisbon treaty was not the same as the European constitution? How much easier would it have been for them to state that something was not significant when it was significant?

[Priti Patel]

I thank my hon. Friend for her intervention. I absolutely agree. We cannot have any grey areas—areas where subjectivity can come back into the decision-making process whatever.

We should remember that it is not just a referendum or adverse, ignorant and reckless government that could further threaten the sovereignty and primacy of our Parliament. Despite the principles behind the Bill, the authority of this Parliament can still be undermined by the bureaucrats and the judges in Brussels. As we have already heard, clause 13 may well confirm that the presence of EU law in this country is dependent upon an Act of Parliament. However, as we know from case law, the text of the Lisbon treaty and on the basis of treaties, EU law holds primacy over that of the laws of member states. In other words, where there is a conflict, EU law will always prevail.

That leads me to question what would happen if the EU decided to challenge the legitimacy of this country holding a referendum on an issue, or if the Commission disagreed with the view of the UK on the extent to which an EU decision affected this country. The judges in Brussels could look at the treaties and pass a judgment that denied the British people a referendum. That would be thoroughly undemocratic. We should guarantee the supremacy of this Parliament when it comes to making laws in this country.

This Bill is a welcome step, but it could have gone much further and contained stronger measures to bring democratic control back to Britain and to safeguard against what I would call competence creep. Many Members of this House know that Europe has already gone much too far in taking powers away from Britain without the consent of the British public, and we are now at a point in our history where the overwhelming consensus among the population is that we need less EU and more Britain. Under this legislation, I would like Ministers to go further to address the situation and come forward with a list of EU laws that should be revoked or disapplied to the UK to defend our national interests and our sovereignty. I do not believe that it is beyond the ability of the parliamentary draftsman to improve the Bill and empower Ministers in this Government to go to Brussels with a mandate to repatriate powers from the EU and return them to their rightful place in this country and to this sovereign House.

The sentiment behind the Bill is right, but it needs to be improved truly to reflect the sovereignty and primacy of this Parliament and the independence of our country, and, importantly, to put Britain’s interests first.

21:21

[Mr Robert Buckland (South Swindon) (Con)]

As my hon. Friend the Member for Witham (Priti Patel) said, this Bill comes at a very interesting time in our history, particularly the history of our relations with what is now the European Union. I was very much taken with the speech of my hon. Friend the Member for Richmond Park (Zac Goldsmith), who described Britain’s relations with the EU as being the opposite of a flirt. I beg to differ with him on that. My view of Britain’s relations with the EU is quite simple: for years, we said no, then we said “Can we come in?”, and then we said yes.

Frankly, in treaty negotiation after treaty negotiation, we have been the thorn in the side of other member states. I think particularly of the drawn-out negotiations that took place at Maastricht and, indeed, after Maastricht, where Britain secured some important opt-outs, notably on economic and monetary union, which then became the euro, and the social chapter, into which the last Labour Government wrongly brought us. It is interesting that the Labour Benches are largely empty. That is symbolic of Labour Members’ attitude to the EU, which is a mixture of ignorance, indifference and their completely supine nature in negotiations on Europe.

I do not stand here as somebody who could be described as a dyed-in-the-wool Eurosceptic. In the tradition of my party, I would be described as pro-European Union. I make no apology for that whatsoever. It is because I am pro-European Union that I support this Bill, because I am also pro-democracy and transparency. The age in which the great and good could decide and determine the future of Europe in smoke-filled rooms—or air-conditioned rooms, as I should now call them—is, I hope, long gone. This Bill represents the beginning of the end of that sort of approach, because it brings transparency to proceedings.

I was interested in the remarks of my hon. Friend the Member for Witham, who spoke eloquently about clause 3. She was right to make the point about ministerial discretion, but the clause makes it a conjunctive condition that an Act of Parliament has to be passed by this House. That is important because it will bring fairly and squarely before this House the sort of details that all too often in the past would have been the subject of covert negotiation. That is no longer acceptable to the people of this country. They no longer want decisions to be imposed upon them; they want to have an active role in decisions and to ensure that their elected representatives or they themselves have a direct say in important transfers of power to Europe. I support that, because as a pro-European Conservative who has taken part in many debates within my party—I concede that I have lost more than I have won—I am a firm believer in democracy.

Any institution that seeks to impose its will on its people without consent deserves to fail and the European Union is no exception. The great divide in Europe is no longer between member states; it is between its leaders and its people. That is why the Bill represents an important step forward and I am happy to support it.

21:26

[Andrew Bridgen (North West Leicestershire) (Con)]

I am mindful of the time constraints on speeches, Mr Deputy Speaker, so that all hon. Members can participate.

I welcome the European Union Bill and the concept of the referendum lock. After so many years of broken promises on Europe, the Bill is essential to regain the trust of the people and to give them faith that the EU will not continue to gain powers from this country. It has always been my opinion that the sovereignty of the country belongs to the people, and that they, not politicians, should make the decision on whether it is transferred to other bodies or countries.

Should justice and home affairs not be subject to the referendum lock? Many of my constituents find justice rulings the most frustrating aspect of our EU membership. The recent ruling that gave prisoners the right to vote, after a convicted murderer appealed successfully to the European Court of Human Rights, is just the latest example of the EU overruling the will of the British Parliament and its people.

Although I support the principle and aims of the Bill, one word that concerns me greatly is “significant”. My concern can be summed up by adapting a famous Sir Humphrey Appleby statement: “Anything can be attacked as a loss of sovereignty, and almost anything can be defended as not a significant loss of sovereignty, which seems to signify that one should appreciate the significance of significant.” What impact does the term “significant” have in the Bill? It could be argued that a future Government would find it difficult to amend something that would not fall under the significance condition. They could claim that the referendum requirement was too rigid and disproportionate to a treaty change that was sought. I also believe that it would be politically courageous for a future Government to remove the referendum lock from the statute book. This should therefore be a permanent piece of legislation. What constitutes significance needs far more definition so that the Bill is not seen merely as a sop to Eurosceptic Back Benchers, of whom I count myself one, but as a genuine change in the way in which we view the sovereignty of our country.

It should not be the Executive who decide what is significant. At the very least, Parliament should dictate what is a significant transfer of power. I refer back to my maiden speech, in which I said that as MPs

“we must not consider ourselves to be the owners of sovereign powers. We are merely the custodians of power and sovereignty for future generations. Sovereignty is not ours to give away; it belongs to the people who elected us, and to their heirs and successors.”—[Official Report, 3 June 2010; Vol. 510, c. 654.]

I intend to support the Bill this evening, but I issue a warning to my right hon. and hon. Friends on the Front Bench. I and many hon. Members will not stand idly by and witness the death of our country’s sovereignty, bled away by a thousand cuts, however small, that some may think insignificant.

21:29

[Dr Thérèse Coffey (Suffolk Coastal) (Con)]

It is a great pleasure to speak on Second Reading, and I will cut to the chase given that I know one more colleague wishes to speak before the Front Benchers.

There is a lot to commend in the Bill, and I will vote for it, but I wish to alert the Minister to some questions that I have posed previously. I hope that he can provide comfort, perhaps not tonight, but in Committee or by writing to me. After I had read the Bill, I thought it went further than I had expected from the coalition agreement. It does much of what we were told it would do by ensuring that ratchet clauses and passerelle clauses will be subject to a referendum. However, there seem to be a few exceptions, to which I wish to draw the House’s attention.

Clause 9(2)(a) to (c) covers articles 81(3), relating to family law, 82(2)(d), relating to criminal procedure, and 83(1), relating to cross-border crime, of the treaty on the functioning of the European Union. Subsection (2)(c) permits

“the identification of further areas of crime to which directives adopted under the ordinary legislative procedure may relate.”

The word “further” indicates to me a transfer of competence or power on which we should have a say. I shall give one example. It could be that Europol is given powers to investigate more areas of crime, for instance in fishing, which might worry my hon. Friend the Member for Witham (Priti Patel). Such a change would not be covered by the need for a referendum. I believe that the Home Affairs Committee and the Select Committee on Justice are due to table several amendments, covering a number of the passerelle clauses that are not currently guaranteed to cause a referendum, and I urge the Government to examine them carefully.

The Foreign Secretary said earlier that we are not giving up control of borders, but the accession treaties to which he referred automatically do that, because they extend the borders within which citizens of the European Union can circulate without hindrance.

As has been said, especially by my hon. Friend the Member for Daventry (Chris Heaton-Harris), it is really important that we are careful about the language that we use to describe the Bill and how we sell it. We certainly do not want to oversell it, as happened in the last Parliament when all three parties said that they would vote for a referendum on the European constitutional treaty but did not. The timing of the Bill is also relevant, and I believe that the Minister is going to talk about that.

There is one other key area in which no referendum is provided for, and it is set out in clause 7(2)(d). It refers to the third paragraph of article 311 of the treaty on the functioning of the EU, which is about own resources. That article states:

“The Council, acting in accordance with a special legislative procedure, shall unanimously and after consulting the European Parliament adopt a decision laying down the provisions relating to the system of own resources of the Union. In this context it may establish new categories of own resources or abolish an existing category.”

In all the discussions about the Lisbon treaty, and about the European constitution before it, that was seen as one of the key articles that would allow the EU to levy its own taxes. When I raised the matter previously with the Minister he suggested that that would require unanimity in the Council of Ministers, and that I should not worry about it, especially under a Conservative coalition Government. However, I do worry about it, because the Bill is about trying to set up the law for the future.

Dare I say it, if the Bill had been in place under the last Government, I am sure that we would not have had a referendum even on the Lisbon treaty, given how it was sold to the UK Parliament as a mere tidying-up exercise. I will vote for the Bill tonight, but I ask the Minister to address my strong concerns about the British public. They do not want to be sold short, and they would be horrified to know that we might be voting for a Bill that would allow the EU to levy taxes, and that they would have no say.

I was three at the time of the last referendum on the EU, and ironically I do not want us to have a referendum in which the Government give away powers. However, it is important that the powers in the Bill are introduced soon to give the public confidence. Dare I put it in a way similar to my European parliamentary colleague Daniel Hannan? Pactio Europae censenda est.

21:34

[Mr Dominic Raab (Esher and Walton) (Con)]

I welcome the Bill. It needs some work before I will be in a position to support it on Third Reading, but it provides a base on which to build.

In the time available, I should like to make four points on the substance. First, many hon. Members said of the significance condition that “significant” is not defined. Given how the previous Government reneged on their promised referendum on the Lisbon treaty—Opposition Members who are finally returning to their seats will have heard that—it would be wise to legislate for the maximum certainty practicable. Will the Minister briefly set out the range of practical options presented by officials for catering with that residual uncertainty?

Secondly, on the selective list of policy areas that trigger a referendum, in 2014, the UK must decide whether to cross the Rubicon on an important justice and home affairs measure. We will need to decide whether to accept European Court of Justice jurisdiction over police and justice measures that pre-date the Lisbon treaty, or to opt out entirely. That is a monumental choice. Do we retain our British justice system, or do we embark on a road that leads to a pan-European model? Under the Bill, that decision would not trigger a referendum. On anyone’s reckoning, that is a critical fork in the road, and it must be included in the list of matters that require a referendum, and the decision must be taken by the British people.

Thirdly—this is also on justice and home affairs—under the Bill, there are only a few matters on which Parliament must approve a decision to opt in. For example, the decision to opt in to the European investigation order would not require Parliament’s approval. Immigration and asylum, on which the EU is driving forward far-reaching changes that will dilute our border controls if we opt in, are also left out. Each of those policy areas is important, and each requires proper parliamentary debate and approval before further powers are handed over to Brussels.

Fourthly and finally, the intention behind the declaration of parliamentary sovereignty in clause 18 is welcome. However, has the Minister considered the warning that Professor Tomkins gave to the European Scrutiny Committee? He highlighted the risk that by legislating to safeguard sovereignty solely in the context of the EU, the courts may infer that Parliament cares less about sovereignty in respect of, for example, the expansion of human rights law and judicial legislation from the Strasbourg Court. That is one more reason for replacing, or at the very least amending, the Human Rights Act 1998. More generally, the Bill does nothing to defend the erosion of sovereignty by the European Court of Justice, and is confined to legislative transfers of power.

That said, my cup is half full. This is a point of departure, not the point of arrival, and I commend the Government and Ministers for breaking new ground with the Bill.

21:37

[Mr Wayne David (Caerphilly) (Lab)]

Before the debate, a number of colleagues told me that the debate would be like the Bill—boring and uninteresting. They were wrong, at least about the debate, which has been wide-ranging, passionate, forensic in its analysis of the Bill, and conducted, by and large, in a reasonable manner. We heard more than 20 speakers. The right hon. Member for Charnwood (Mr Dorrell), and the hon. Members for South Thanet (Laura Sandys), for Enfield North (Nick de Bois), for Cleethorpes (Martin Vickers) and for North East Somerset (Jacob Rees-Mogg) spoke in favour of the Bill. A handful of hon. Members spoke against the EU rather than the Bill as such, but many, including my right hon. Friend the Member for Rotherham (Mr MacShane), my hon. Friends the Members for Rhondda (Chris Bryant), for Ilford South (Mike Gapes) and for Preston (Mark Hendrick), the right hon. Member for Wokingham (Mr Redwood) and the hon. Member for Hertsmere (Mr Clappison), expressed reservations—strong and not so strong—about the Bill.

I wanted to refer specifically to only three contributions. First, the hon. Member for Harwich and North Essex (Mr Jenkin) questioned whether the Bill was crudely political—he described it as a byzantine Bill. He asked when it will come into effect. Will the Minister respond to that? He also questioned, as did the hon. Member for Daventry (Chris Heaton-Harris), whether the Bill is an attempt, intentional or otherwise, to undermine the sovereignty of this and future Parliaments.

Secondly, the hon. Member for Westmorland and Lonsdale (Tim Farron), who by the way is a Liberal Democrat, said that the Bill is a firm example of a coalition product. I absolutely agree with him. The Bill is muddled and contradictory, and is indeed a fine example of the coalition product.

Thirdly, we heard a notable and informed contribution from the hon. Member for Stone (Mr Cash). He referred to the misleading explanatory notes and said that the Bill shows judicial activism on the march. He also said that it was an invitation to litigation and called it a mouse of a Bill—I would say it is more like a drowned rat.

There have been a number of common themes in the debate. Members on both sides of the House have highlighted the poor drafting of the Bill. It is unclear when a referendum would be held; it is unclear about when a passarelle would require an Act of Parliament or a referendum; and it is unclear whether the sovereignty clause adds anything to British law—it probably does not. The one thing that the Bill is clear about, however, is that it is a recipe for unending confusion. The Government promised red meat to their Eurosceptic Back Benchers, but what we actually have is a rancid old bone for us all to gnaw on.

The only people who will be happy with the Bill are the lawyers, who will revel in endless judicial reviews. The Bill is fundamentally flawed. It is a ham-fisted attempt to define our relationship with the European Union, but it fails to do so. Instead, we have a botched, esoteric, convoluted, obsessively intricate collection of ill-defined, half-baked, miasmic proposals—and that is just to start. The Bill will serve only to confuse and will satisfy and placate no one: it only underlines the confusion at the heart of the Government’s European policy.

21:41

[The Minister for Europe (Mr David Lidington)]

I think that the brevity of the speech by the Labour spokesman, the hon. Member for Caerphilly (Mr David), is indicative of the absence of content in the Opposition’s case today. We have heard from no less than the Leader of the Opposition that he regards his policies as a blank sheet of paper, and that is what we have heard from the hon. Gentleman this evening.

Like the hon. Gentleman, I want to pay tribute to every right hon. and hon. Member who has taken part in the debate, and I am glad that so many Members, on both sides of the House, have managed to participate. I want to respond briefly to a number of specific issues, and then move on to the questions about clause 18 and the referendum lock, which have occupied most of the debate. I might be unable to cover all the ground today, but I will look forward with relish to the five days of debate on the Bill on the Floor of the House—in Committee of the whole House and on Third Reading—in the new year.

My hon. Friends the Members for Harwich and North Essex (Mr Jenkin) and for Daventry (Chris Heaton-Harris) asked about the commencement of the Bill and whether it would take effect in the lifetime of this Parliament. As they know, the Government have made it clear, as a policy commitment, that we are not going to agree to any treaty change or new treaty that transfers additional powers or competences to the European Union for the duration of this Parliament. That is a policy commitment. Clause 21 provides for the commencement of the whole of part 3, including clause 18, on Royal Assent. The rest of the Bill comes

“into force on such day as the Secretary of State may…appoint.”

To avoid any misunderstanding, however, I want to make it clear that the Government intend to use the provisions of the Bill for any future treaty change. The House will know that one such change is being contemplated now. We also expect to use the provisions on increased parliamentary control during the lifetime of the Parliament, because we expect that there will be some proposals, possibly including an agreement on a new multi-annual financial framework, that will trigger the need for an Act of Parliament under the terms of the Bill.

My hon. Friend the Member for Daventry also asked me whether it would be possible for a European prosecutor to be built up bit by bit, thereby avoiding a referendum. The Bill is very clear on that. The United Kingdom could not take part in either a European public prosecutor established under article 86.1 of the treaty or the extension of the powers of such a prosecutor, if set up, under article 86.4 without a referendum. As the treaty provides a specific treaty base for the establishment of a European public prosecutor, that action could not be taken on a different treaty base.

My hon. Friend the Member for Witham (Priti Patel) asked whether there would be any way for the European Union to prevent us from holding a referendum in this country. The answer to that question is no. There is nothing in the treaties that puts any constraints on the way in which the United Kingdom or any other member state decides how to cast its vote on a treaty amendment or a treaty change. The Bill sets out more stringent requirements before a British Minister can assent to something on behalf of this country at the European level. That is a matter for national law, not for European law.

Let me turn to the points made in particular by my hon. Friend the Member for Stone (Mr Cash), but also by a number of other hon. Ladies and Gentlemen, about clause 18. I want to be absolutely plain that the Government are not attempting through clause 18 to address the wider constitutional issue of the sovereignty of Parliament in the way alluded to by my hon. Friend the Member for Esher and Walton (Mr Raab) when he referred to the European convention on human rights and the Human Rights Act 1998, for example—or the sovereignty of Parliament and what that means in the context of the devolution settlements for Scotland, Wales and Northern Ireland.

What clause 18 does is more specific than that—this point was referred to by my hon. Friend the Member for North East Somerset (Jacob Rees-Mogg). Clause 18 deals with the way in which European law, including judgments of the European Court of Justice, is given effect in this country. The clause asserts, for the first time in statutory form, what is already the position in common law as a consequence of decisions by various judges in leading cases: that there is only one reason why European law has effect in this country, and one reason too why, where the two clash, European law is given primacy over United Kingdom law, and that is because Acts of Parliament—notably, but not exclusively, the European Communities Act 1972—provide for such effect to be given to European law.

[Mr Cash]

Does my hon. Friend agree that the very fact that this provision is being included in statute inevitably means that the courts will have the opportunity to apply the common law principle and that therefore he cannot, by a speech in the House of Commons, restrict the manner in which the courts subsequently interpret the provision?

[Mr Lidington]

What I would say to my hon. Friend is that to some extent we are repeating the exchanges that we enjoyed in his Committee yesterday. Clause 18 places firmly on the statute book a point of reference to which any future court that considers an argument about the source of authority for European law in this country must have regard. My hon. Friend the Member for North East Somerset put it in terms of turning the clock back to 1972. As my hon. Friend the Member for Harwich and North Essex said in an intervention, it is not the case that the argument that European law derives its authority solely from Acts of Parliament has gone unchallenged. It was not only in the prosecution arguments in the metric martyrs case, but in the obiter from Lord Justices Steyn and Hope, to which he referred, that a very different case was asserted—namely that, over time, European law has acquired some kind of autonomous authority in this country. Hitherto, the United Kingdom courts have rejected that argument and upheld the doctrine that it is only through Acts of Parliament that European law has authority here. The clause will provide in statute for the first time a clear point of reference to which the courts must have regard.

[Mr Jenkin]

My hon. Friend is dealing carefully with the points that have been raised, but will he treat seriously the evidence given to the European Scrutiny Committee by Professor Tomkins? At the end of his written evidence, he stated:

“If Parliament is of the view that its sovereignty requires to be freshly articulated and safeguarded in legislation, it would be well advised to proceed with great care and caution, lest the consequences of its actions come to be seen as the proverbial red rag to the bull.”

I am not convinced that the clause, as drafted, would not be that red rag.

[Mr Lidington]

We debated this matter at great length in Committee in January. A number of the learned academics who gave evidence to the European Scrutiny Committee discussed parliamentary sovereignty in broad constitutional terms, rather than in terms of the precise objective of clause 18, which is to recapitulate in statutory form the means by which European law is given effect in the United Kingdom.

I want to make it clear from the start that we are talking about a referendum lock on future treaty changes that transfer powers or competence—in particular, powers involving the surrender of vetoes—and that we are not seeking to overturn the terms of existing treaties. I know that that will disappoint a number of Members on both sides of the House, but, as my right hon. Friend the Foreign Secretary said in his opening speech, we are in a legal environment established by the Lisbon treaty, even though some of us might wish that we were not, and we must start from the position that we are now in.

[Mr Redwood]

Will the Minister tell us whether he can conceive of any circumstances in which this Government would offer a referendum on any aspect of Europe?

[Mr Lidington]

I thought I had made that clear—[Interruption.] The Government—[Interruption.]

[Mr Speaker]

Order. There is far too much noise from the Opposition Benches. I have heard the question; I want to hear the Minister’s answer.

[Mr Lidington]

The Government have made it clear that we would not assent to a transfer of competence or powers during the lifetime of this Parliament. It follows, therefore, that we do not expect a referendum in the lifetime of this Parliament, but unforeseen events might arise. The Bill, once it becomes law, will be binding on this Government as well as on any future Administration, whatever circumstances might arise.

[Mr David]

Will the Minister give way?

[Mr Lidington]

No, I want to deal with the objections and criticisms that have been made to and of the referendum lock. Serious questions have been asked on both sides during the debate and I want to respond to them. One set of objections came from the hon. Member for Rhondda (Chris Bryant), who made it clear that he objected to all referendums as a matter of principle—

[Chris Bryant]

No, I did not.

[Mr Lidington]

He is now saying that he does not, and I am happy to hear him qualify his earlier remarks. The problem with such an argument is that it ignores two things. First, it underestimates the depth of the mistrust and disaffection that people in this country now feel towards the way in which powers have been transferred from the United Kingdom to the European Union without the people ever being asked for their agreement. It ill becomes the Labour party in particular to offer criticism on this score when the prime reason for such disaffection over the last few years has been that party’s refusal, when in government and with a majority in this House, to agree to the people having a referendum, which had been promised at the general election. This was a promise on which Labour was happy to renege when it came into office.

The argument against referendums on principle ignores the fact that the practice has grown up in the last 13 years of holding referendums on major constitutional changes. We have had them in Scotland, Wales, Northern Ireland, Greater London and even in the north-east of England, and I think that people now have a reasonable expectation that they will be invited to have their say if their basic constitutional rights are being affected by legislation proposed by Ministers.

[Mr David]

rose—

[Mr Lidington]

The second line of criticism was rather more subtle than that presented by the hon. Member for Rhondda. It was articulated by a number of colleagues, including my hon. Friend the Member for Richmond Park (Zac Goldsmith), who argued that the Bill left too much discretion to Ministers. My hon. Friends the Members for North West Leicestershire (Andrew Bridgen) and for Witham echoed that argument.

My response is that a number of options were available to us. One was to draft a test phrased in fairly general terms, saying that an important measure would require a referendum, but leaving it to the Government of the day to determine whether that test had been met. We took the view that that would have left far too much discretionary power in the hands of Ministers. What we have done instead is to introduce a Bill that quite deliberately limits ministerial discretion by specifying those changes that would trigger a referendum and also those limited categories of treaty change that would be exempt from the referendum requirement.

Several hon. Friends talked about the significance test, which applies only to a change brought forward under the simplified revision procedure. Within that category of treaty change, it applies only if the sole reason for its falling within the referendum lock is that it falls under clause 4(1)(i) or (j). Any proposal that is covered by clause 4(1)(a) to (h) or clause 4(1)(k) to (m) automatically attracts a referendum. In reply to a direct question put to me, yes, if this Bill had been law at the time, the Lisbon treaty negotiated under the ordinary rules of procedure would have required a referendum before it had been ratified. I only wish we had had such a provision on the statute book when the Labour party betrayed this country’s interests and reneged on the promises it had given.

My hon. Friend the Member for Hertsmere (Mr Clappison) argued that the significance was subject only to judicial review and not to Parliament. Of course it is true that any Executive decision by any Minister is liable to judicial review. I dispute his argument, however. Irrespective of whether the significance test applies and whether a referendum is required, any treaty change, however minor, will require an Act of Parliament for its ratification. Such an Act will be subject to full debate and scrutiny and will be capable of amendment in whatever way Parliament wishes.

[Mr David]

rose—

[Mr Lidington]

Through this Bill we are making the Government more accountable to the British people for what they do in Europe. We are ensuring that any new proposal to take powers from this place to Brussels will involve the people in having the final say. I commend the Bill to the House.

Question put, That the amendment be made.

21:59

Division 145

Ayes: 195

---

Labour: 188
Independent: 2
Social Democratic & Labour Party: 1
Alliance: 1
Green Party: 1
Democratic Unionist Party: 1
Plaid Cymru: 1

Noes: 330

---

Conservative: 272
Liberal Democrat: 46
Democratic Unionist Party: 6
Scottish National Party: 4
Plaid Cymru: 1

Question put forthwith (Standing Order No. 62(2)), That the Bill be now read a Second time.

Question agreed to.

Bill accordingly read a Second time.

EUROPEAN UNION BILL (PROGRAMME)

Motion made, and Question put forthwith (Standing Order No. 83A(7)),

That the following provisions shall apply to the European Union Bill:

Committal

1. The Bill shall be committed to a Committee of the whole House.

Proceedings in Committee, on consideration and Third Reading

2. Proceedings in Committee, any proceedings on consideration and proceedings on Third Reading shall be completed in five days.

3. The proceedings shall be taken in the order shown in the first column of the following Table.

4. The proceedings shall (so far as not previously concluded) be brought to a conclusion at the times specified in the second column of the Table.

TABLE
Proceedings	Time for conclusion of proceedings
Clause 18, new Clauses relating to Clause 18, new Schedules relating to Clause 18.	The moment of interruption on the first day.
Clauses 1 to 5, new Clauses relating to any of Clauses 1 to 5, new Schedules relating to any of Clauses 1 to 5.	The moment of interruption on the second day.
Clause 6, Schedule 1, new Clauses relating to Clause 6 or Schedule 1,new Schedules relating to Clause 6 or Schedule 1.	90 minutes before the moment of interruption on the third day.
Clauses 11 to 13, new Clauses relating to any of Clauses 11 to 13, new Schedules relating to any of Clauses 11 to 13.	The moment of interruption on the third day.
Clauses 7 to 10, new Clauses relating to any of Clauses 7 to 10, new Schedules relating to any of Clauses 7 to 10, Clause 14, new Clauses relating to Clause 14, new Schedules relating to Clause 14.	The moment of interruption on the fourth day.
Clauses 15 to 17, Schedule 2, new Clauses relating to Part 2, new Schedules relating to Part 2, Clauses 19 to 22, remaining new Clauses, remaining new Schedules, remaining proceedings in Committee.	Two hours before the moment of interruption on the fifth day.
Any proceedings on consideration, proceedings on Third Reading.	The moment of interruption on the fifth day.

5. Standing Order No. 83B (programming committees) shall not apply to proceedings in Committee, to any proceedings on consideration or to proceedings on Third Reading.

Other Proceedings

6. Any other proceedings on the Bill (including any proceedings on consideration of Lords Amendments or on any further messages from the Lords may be programmed.—(James Duddridge.)

Question agreed to.

EUROPEAN UNION BILL [MONEY]

Motion made, and Question put forthwith (Standing Order No. 52(1)(a)).

That, for the purposes of any Act resulting from the European Union Bill, it is expedient to authorise—

(1) the payment out of money provided by Parliament of any increase attributable to the Act in the sums payable under any other Act out of money so provided, and

(2) the payment out of the Consolidated Fund of any increase attributable to the Act in the sums to be charged on and paid out of that Fund under any other Act.—(James Duddridge.)

Question agreed to.

Business without Debate

Tuesday 7th December 2010 Commons Chamber

[Mr Speaker]

We come now to the 10 o’clock motions and the business of the House motion in the name of the Prime Minister.

[The Lord Commissioner of Her Majesty's Treasury (James Duddridge)]

Not moved. [Interruption.]

[Mr Speaker]

Order. The House must calm itself. We will come to other matters in due course—any points of order and so on. The next motion is on Deferred Divisions, in the name of the Prime Minister.

[James Duddridge]

Not moved.

[Mr Speaker]

We come to the business of the House motion in the name of the Leader of the House.

[James Duddridge]

Not moved.

[Hilary Benn (Leeds Central) (Lab)]

On a point of order, Mr Speaker. The Government are clearly in a state of chaos when it comes to tuition fees. Yesterday, the Leader of the House tried to move a motion and it was objected to, much to the anger of the Chief Whip, as you know. Today, the Leader of the House tabled one motion in his own name and two motions in the name of the Prime Minister but, as we have just seen, did not have the courage to move the motion in his own name.

I am sure that you understand the deep sense of anger that there is in the House at the amount of time that the Government are proposing to give Members on Thursday to debate the biggest change in tuition fees and support for higher education that we have ever seen. Since the House is being treated with contempt by the Government, may we now have a statement from the Leader of the House to tell us what on earth is going on? Will he indicate how much time we will have on Thursday to debate the increase in tuition fees? [Interruption.]

[Mr Speaker]

Order. I am grateful to the right hon. Gentleman for his point of order. The concern of the Chair is always that matters should be handled in an orderly manner. [Interruption.] Order. That has happened, whatever the disquiet or consternation the right hon. Gentleman or others may feel. I know that he will understand that it would not be right for me, from the Chair, to say anything more on the matter. His concerns have, however, been forcefully registered.

[Mr Gareth Thomas (Harrow West) (Lab/Co-op)]

Further to that point of order, Mr Speaker. I expected to be debating with the Minister for Universities and Science tonight, yet we have not had even the courtesy of an explanation why the Government have not moved their motions tonight. Have you been given an explanation? How can it be acceptable that students will be saddled with £39,000-worth of debt after just three hours of debate in the House—£13,000 of debt for each hour of debate?

[Mr Speaker]

My simple response to the hon. Gentleman is that it would not be right now to rehearse matters of substance relating to the tuition fees debate, which there will be an opportunity to develop on Thursday. I am sure the hon. Gentleman looks forward to that opportunity. He, too, has put his concerns explicitly on the record.

Crown Currency Exchange

Tuesday 7th December 2010 Commons Chamber

Motion made, and Question proposed, That this House do now adjourn.—(James Duddridge.)

[Mr Speaker]

I call Tessa Munt. [Interruption.] I note the considerable excitement in the House, and I am concerned that the hon. Lady should be able to develop her case on the regulation of foreign exchange services and the case of Crown Currency Exchange. I therefore appeal to right hon. and hon. Members leaving the Chamber to do so quickly and quietly, and to afford the hon. Lady the same courtesy as they would wish to be extended if they themselves had the Adjournment, so I hope there will be no further animated conversations, even between very senior Members.

22:19

[Tessa Munt (Wells) (LD)]

Thank you, Mr. Speaker. I particularly thank the Minister for attending this evening to reply to this debate on the failure of Crown Currency Exchange. This is a matter that particularly concerns my constituents, Nick and Larissa Fry from Axbridge, and I also speak on behalf of a retired bank manager from Holcombe in the neighbouring constituency of the Deputy Leader of the House, my hon. Friend the Member for Somerton and Frome (Mr Heath).

The problem as far as I understand it is that companies such as Crown Currency Exchange are registered with the Financial Services Authority, but the legislation governing its activities looks at the size of the company, not at what it is doing. Crown Currency Exchange appears to have been behaving a bit like a high street bank or foreign currency exchange, and was registered as a small payments institution. As I understand it, it was meant to operate under an average of €3 million a month, but it appears from the administrator’s report that for the last 10 months the trading average was at about €10 million a month.

The legislation appears to exclude 547 small payments institutions in particular, from all of the many thousands of companies that are registered with the FSA. I want particularly to draw the House’s attention to the FSA website, which states that the FSA’s general duties

“in so far as reasonably possible”

are that it should provide

“market confidence, public awareness, protection of consumers and a reduction of financial crime.”

It appears that in this particular case it has failed on all four counts. The FSA also says that it is

“the regulator of all providers of financial services in the UK”,

and for that reason alone it is within certainly a retired bank manager’s understanding, my original understanding and the understanding of most people that these companies are in some way controlled by the FSA.

Crown Currency Exchange displayed on its website, besides the FSA logo, that of Her Majesty’s Revenue and Customs, which was clearly for money-laundering purposes. People are therefore entitled to feel that there should have been some sort of cover for the activities that that company undertook.

[Mr Michael McCann (East Kilbride, Strathaven and Lesmahagow) (Lab)]

A number of my constituents who have been involved with CCE have also contacted me. Is it not equally despicable that the company sought to suggest that the lucrative exchange rates for the US dollar that it was actively advertising were the result of orders that had been cancelled, which allowed it to offer these fabulous terms, when in actual fact it had no currency, and it simply wanted to bring cash flow in to continue trading? Is that not a major concern that should have been picked up by the FSA?

[Tessa Munt]

That is quite correct. It certainly seems that on several occasions a number of people brought these problems to the attention of the FSA. One of whom was Robin Haynes, the managing director of Currency Index Ltd. He raised concerns about Crown Currency Exchange with the FSA in March 2009 and September 2010. He raised his concerns with HMRC in September 2010 and with Barclays, Crown Currency Exchange’s bankers, in May 2009. None of those appears to have been acted on.

There is also the case of a whistleblower who reported his concerns to the companies investigations branch of the Insolvency Service on 20 August 2009, but again nothing appeared to happen. It seems that none of those bodies is able to investigate a company until it has done something completely awful to its customers.

[Mr Russell Brown (Dumfries and Galloway) (Lab)]

I congratulate the hon. Lady on securing the debate, because it has been stipulated that Barclays bank raised concerns about the company prior to its collapse but kept quiet. Does she, like me, believe that that should be further investigated?

[Tessa Munt]

I hope so, because so many people were taken in by the idea that they had some security, and Barclays probably should have done something. I understand that there was a meeting between one or two company directors and their bankers, Barclays, on 21 July, and that there were concerns at the time about the company’s solvency, yet for some months afterwards people still tried to put their money into the company, without any results.

[John Howell (Henley) (Con)]

Does my hon. Friend agree with a constituent of mine, who wrote to me to say:

“I think everyone would agree that if one is registered with the FSA it implies that that actually means something—it didn’t”?

[Tessa Munt]

Absolutely. Alarmingly, the FSA website states:

“We keep an up-to-date record of all FSA-regulated firms, bodies and individuals doing business in the UK. Our register is available to the public, so you can search for more information on all of our authorised firms.”

The problem is that the FSA seems to use “registered”, “regulated” and “authorised” almost conversationally, but in legal terms those definitions should not be bandied around on its website in such a way.

[Jim Shannon (Strangford) (DUP)]

Throughout the whole United Kingdom, not just on the UK mainland, but in Northern Ireland, those who can least afford it have invested money in that system. I understand that a police investigation started today. Does the hon. Lady agree that, on the back of that investigation, a Government investigation should follow?

[Tessa Munt]

I hope so. There have been some arrests today, and I think that Devon and Cornwall police’s serious crime squad is taking part. I hope that that prefaces some action by the FSA.

[Andrew George (St Ives) (LD)]

Arrests have been made, including of one of my constituents. Indeed, the company’s offices were based in Hayle in my former constituency. The case has given rise to enormous concern, and although it is not on the same scale as sub-prime casino banking it has left many people in serious circumstances. I hope that my hon. Friend will advance her case, because this situation clearly needs to be regulated in future.

[Tessa Munt]

One might just need to get rid of “registered”, because it seems to have absolutely no meaning and to afford no protection—nothing.

[Cathy Jamieson (Kilmarnock and Loudoun) (Lab/Co-op)]

I, too, congratulate the hon. Lady on securing the debate. The presence of so many Members shows the scale of the problem. My constituents believed that “registered” actually meant something in law. Does she agree that that has to be addressed urgently to ensure that no one else loses out?

[Tessa Munt]

I could not agree more. One problem I have discovered is that, although in the registration process the FSA takes receipt of £500, it is an overseer and not in any way, shape or form a regulator. The directors and responsible officers of a company have to declare under registration unspent criminal convictions for financial crimes, terrorist funding, money laundering and fraud, but there are two difficulties with that. First, the punishment for not doing so appears to be no more than three months in jail, and, if one is rocking along with £100 million, that is probably worth it. The other thing is that it appears that the FSA has absolutely no means of checking the information because it has no access to the Criminal Records Bureau. Registration is clearly not effective; we need to look at regulation for all these companies.

[Tom Greatrex (Rutherglen and Hamilton West) (Lab/Co-op)]

I am grateful to the hon. Lady; she has taken a number of interventions, although she has limited time to make her case. I congratulate her on securing the debate. Does she share my concern? I have raised constituents’ cases with the FSA, but I have not had any replies at all.

[Tessa Munt]

I have one quote from the FSA complaints department. It says:

“We are unable to look at your case under our complaints scheme as your complaint falls outside the scope of the scheme…However, we will deal with the complaint…It appears that registered companies are not part of the complaints scheme.”

It seems a little confused. To be honest, if the FSA does not know what falls within and without the complaints scheme, it will be difficult for any member of the public who has been brought into the situation with a false sense of security.

[Mr Robin Walker (Worcester) (Con)]

I congratulate the hon. Lady on securing this important debate. On behalf of my constituent Chris Neath, who lost more than £3,000 in this scandal, I would like to ask this question. Does she agree that we must remove the confusion among the public between registration and regulation? We should make it clear in this debate that the FSA must take a much stronger line on companies of this size and this sort.

[Tessa Munt]

Absolutely. I hope that that will be part of the outcome. I ask the Minister in particular whether he would agree to meet members of the group Action against Crown Currency Exchange, me and other Members whose constituents have an interest, so that we can explore what might be done. It certainly seems to me that the legislation does not allow the FSA to operate in an effective way. Perhaps it is for the House to deal with that.

[Mr Wayne David (Caerphilly) (Lab)]

What message can the hon. Lady give to my constituents, and many others across the country who have lost large sums of money, about what hope they might have of compensation?

[Tessa Munt]

I am an optimist, so I hope that we might be able to do something, but it would appear that the directors of the company have operated through a loophole in the scheme. I suspect that they were very savvy and knew exactly what they were doing. They have registered rather than being regulated or authorised. Some 13,000 people have lost £20 million and there is enormous distress and dismay about what has happened.

[Dan Byles (North Warwickshire) (Con)]

I am grateful to my hon. Friend for giving way, as I am conscious that time is pressing. I join colleagues in congratulating her on securing this debate. Does she have any idea about how many other companies are registered but not regulated by the FSA?

[Tessa Munt]

I am not aware of the numbers; I am aware only that there is a peculiarity relating to 547 small payments institutions that do not seem to be regulated as other companies are. I hope that the Minister will give some response to the questions that have been raised.

[Andrew Selous (South West Bedfordshire) (Con)]

Does the hon. Lady share my concern that the business of Crown Currency Exchange was apparently regarded as low risk, when anyone with a basic grasp of economics could see the massive risk inherent in currency fluctuation up to a year in advance?

[Tessa Munt]

It is certainly clear that a number of people alerted various sections of the authorities. A year ago, the Financial Times and the financial pages of The Daily Telegraph and The Mail on Sunday were raising concerns, and they were right to do so.

[Peter Aldous (Waveney) (Con)]

I congratulate the hon. Lady on securing this debate. I have had a response from the FSA. It says:

“In our judgement it would not be possible for the FSA to ban firms such as CCE from describing themselves as “registered for payment services”. Any amendment to the register requirements in the Payment Services Regulations would be a matter for HM Treasury.”

Will she ask the Minister whether he will consider that?

[Tessa Munt]

I will do precisely that.

22:34

[The Financial Secretary to the Treasury (Mr Mark Hoban)]

I congratulate the hon. Member for Wells (Tessa Munt) on securing a debate on this important topic. The fact that there are 40 Members here tonight demonstrates the widespread interest across the House in what has happened to Crown Currency Exchange. I am glad to have the opportunity to explore the collapse of Crown Currency Exchange and touch more broadly on how foreign exchange services are regulated.

I share the hon. Lady’s concern about the impact of the failure of Crown Currency Exchange. I have enormous sympathy for the 13,000 people who have been affected by its collapse. They are honest, hard-working people who have been hit hard and, in some cases, the losses have been considerable. I welcome the work of the administrators in investigating the issues surrounding Crown’s collapse, and their efforts to recover as much money as possible for the consumers affected. The administrators have written to the creditors, and have held a creditors’ meeting to discuss their proposals. They will continue to review Crown’s trading operation, its financial position and the conduct of its directors. I look forward to receiving the administrators’ report, so that the Government can consider what lessons can be learned from it and assess what might need to be done to protect customers in future.

Crown Currency Exchange operated an online bureau de change—put simply, it bought and sold currency over the internet, which is quite normal in modern day currency exchanges. However, what separated Crown from other operators was that it was among a minority of companies whose customers paid for their foreign currency weeks or months before they were due to receive it. Some other aspects of its operations were also unusual. It offered much better rates than those on the high street and enticed customers by offering special deals purporting to be from cancelled contracts that did not exist. It did not hedge its exposure to foreign exchange rate changes, so it was at risk if sterling moved against it, and it took payment in full and in advance, for up to a year before delivery. In addition, it did not accept payments by debit or credit card. Crown’s business model was an outlier, which posed risks to the firm and, as we know, to consumers. The way in which Crown operated meant that consumers lacked protection because they were unable to pay by debit or credit card.

I do not wish to prejudge the causes of Crown’s failure. The administrators’ final report, which is expected in a few months, will go over that in detail, and look at the conduct of the company’s directors. Let me touch on the regulatory questions raised by the failure. As we have heard, Crown Currency Exchange was registered by the Financial Services Authority as a small payments institution, which means that it managed payments from one person to another. Such institutions may handle the remittances from migrant workers to be sent home to their families, or they may offer an internet service for making payments in competition with the banks.

European legislation—the payment services directive—provides for light touch regulation of small payments institutions. That was the case with Crown, which had some reporting obligations to the FSA. However, the FSA was not required to exercise any prudential regulation, such as oversight of capital requirements over Crown; it was required only to oversee its payments. Buying and selling foreign currency is not a regulated activity, so Crown’s foreign currency sales were not regulated by the FSA. The regulatory requirements relating to foreign currency sales are limited to quoting rates clearly, which the FSA oversees, and complying with money laundering legislation, which Her Majesty’s Revenue and Customs oversees. The money laundering rules are designed to fight terrorism and crime, not to protect customer deposits. That is why neither the FSA nor HMRC was in a position to investigate or address any problems with the business model of Crown Currency Exchange.

[Mr Dominic Raab (Esher and Walton) (Con)]

A number of my constituents have also lost money in this case. I recognise the limited remit of the FSA, but should it have registered CCE when, as I understand it, one of CCE’s directors had a criminal conviction? Was that an example of maladministration, or will that be reviewed?

[Mr Hoban]

Often in these cases—I do not want to go into detail on this—the FSA is dependent on disclosure by directors. As the hon. Lady said, the FSA does not have the power to access criminal records to enable it to find out whether directors’ disclosures are accurate.

The question that we need to address is why foreign exchange services are not more tightly regulated. Traditionally, buying and selling currency is the same as buying and selling any other commodity, whether it is gold and silver or food and drink. With the exception of Crown, this kind of trading has been, and remains, a low-risk business. It is something that millions of us do day in, day out, whether at the post office, in banks or at bureaux de change, without a problem. But Crown’s business model was different, and what should have been straightforward transactions led to substantial losses for its customers. I accept, of course, that Crown has inflicted substantial losses on customers. The Government are anxious to learn the lessons from this failure and to take what action may be needed, including regulatory changes.

[Mr Dennis Skinner (Bolsover) (Lab)]

A lot of people have lost money, including people in my constituency and loads of others. Does the Minister think that, as in the case of Equitable Life, it would be a good idea to make sure that the financial ombudsman has a look at this case?

[Mr Hoban]

It is not a matter for the ombudsman—it is for the administrator to decide what further actions are needed. As I said, the problem is that the nature of this business was such that it fell outside the regulatory perimeters. It is not covered by the Financial Ombudsman Service or the financial services compensation scheme, so there is a distinction between this case and the one to which the hon. Gentleman refers.

[Nick Smith (Blaenau Gwent) (Lab)]

Will the Minister give way?

[Mr Hoban]

I should like to make some progress, as there are important points that I want to make by the time I finish in seven minutes’ time.

I want to reassure hon. Members that I am anxious to protect customers and that we should learn lessons from this. I would point out, however, that there are 1,480 businesses operating as bureaux de change in this country, the vast majority of which are retail outlets dealing with customers face to face. The majority of these firms are not taking payment in advance or entering into forward currency contracts. They do not expose their customers to the kind of risks that Crown appears to have done.

[Nick Smith]

Will the Minister give way?

[Mr Hoban]

No, I am going to continue.

The regulation of these businesses, including capital requirements, would impose costs on them and on their customers, so we must be sure that the benefits of regulation outweigh the cost to consumers. I assure hon. Members that we are looking at the other companies to see if any are operating in the same way as Crown. We have not yet identified any, although the investigation is still ongoing. I undertake that the Government will seek to learn the lessons from Crown’s failure, once we have all the facts, and take whatever action is appropriate.

[Tessa Munt]

Will the Minister give way?

[Mr Hoban]

Let me continue for a bit longer.

I recognise that there are innocent victims at the heart of this, but because Crown’s activities are not regulated by the FSA, its customers are not covered by the financial services compensation scheme. Crown did not accept credit card or debit card payments, so its customers are not covered by the protection they offer, and I am afraid that they are therefore awaiting the outcome of the administration process. I believe that it is vital that consumers understand their rights and what products and services are covered by the FSCS. I welcome the fact that the FSCS is launching a campaign in the new year to raise consumer awareness and encourage them to seek more information on what is and is not covered by the scheme. However, I also believe that there is a responsibility on companies to be up front with their customers about the protection that is available if something goes wrong, particularly where the business is complex, as was the case with Crown.

[Tessa Munt]

Exactly what purpose is served by registering a small payments institution with the FSA? Given that the FSA makes it perfectly clear that it denies any regulatory involvement with small payments institutions, of which there are 547, I am not entirely sure for what one is paying £500.

[Mr Hoban]

The hon. Lady makes an important point, but the reality is that this activity falls outside the regulatory perimeter of the FSA. The reason these businesses are registered with the FSA is that when the payments services directive was introduced, there had to be somewhere for these businesses to be registered, so the decision was taken to register them with the FSA. That decision was taken not by this Government, but by the previous Government. The hon. Lady is right that that situation leads to some confusion for consumers. The reality is that such businesses were not regulated by the FSA. The same applies to the other 1,500 bureaux de change that operate under this model.

[Nick Smith]

I thank the Minister for giving way. Given the scale of the issue with 13,000 people having been affected, will the Minister tell us more about the role of Barclays bank?

[Mr Hoban]

Barclays had a limited relationship with Crown. It did not lend money to Crown, but simply provided it with a bank account. It raised a number of questions with Crown, but the answers gave no cause for concern. It acted simply as Crown’s bank and had no engagement in the business.

[Mr Russell Brown]

I could ask the Minister when he believes that my constituents will receive money and how much, but I want to come back to the fact that the company was classed as a small payments institution, despite its turnover putting it in a category that meant it should have been regulated. Is he in a position to instruct the FSA to look at the more than 500 other companies that are small payments institutions to see whether they fall into a regulated category?

[Mr Hoban]

When the €3 million figure is exceeded, a company should be regulated, but that figure refers to the average monthly payment transaction. A company can therefore be turning over €36 million a year and still fall below the threshold for registration.

To conclude, I agree with the hon. Lady that the collapse of Crown Currency Exchange has hit 13,000 innocent victims and that, in some cases, the losses have been substantial. We all agree that that should not happen again, that we have to learn the lessons from Crown’s failure and that we must take all the steps necessary to ensure that consumers are better informed about the risks that they take and the rights that they have. We will be able to determine the action to be taken by the Government or the regulators only once we have received the report. We will look at the costs and benefits of regulation. I remind the hon. Lady that in last week’s debate on the retail distribution review, she pointed out the risk that more regulation poses to businesses.

We must ensure that there is proper regulation for consumers. We must learn the lessons from Crown to ensure that we put the right protection in place for consumers, given the risks involved. I assure hon. Members who take an interest in this matter that I will keep them up to date with what is happening with Crown. I recognise from the number of hon. Members present in the House tonight how important—

22:48

House adjourned without Question put (Standing Order No. 9(7)).