(13 years, 6 months ago)
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Lord Radice
Before my noble friend gets up, I rise to oppose both the tone and the principle of Amendment 20A. I oppose the tone because, as several noble Lords have pointed out, enlargement has been exceptionally good not only for the European Union but for Britain’s interests. As my noble friend Lord Tomlinson pointed out, some jolly rich countries have joined and have been our allies in some of our negotiations over such issues as the budget and the reform of the CAP. The so-called poorer countries are mostly former members of the Soviet bloc, nearly all of which have joined. They have become more prosperous as a result of being members of the European Union, particularly Poland, which is one of the great success stories. This is not just about Polish plumbers coming to France and Britain; it is also about the standard of living and growth rate in Poland increasing considerably. It is a big success story. Let us hear more about it from the Ministers. I hope to hear the Minister say something about enlargement, as it is a good thing.
Enlargement also buttresses democracy in these countries. To be a member of the European Union a country must be a democracy. This is a tremendous weapon that we and the European Union have in changing and underwriting the whole issue of democracy in Europe. Therefore, I oppose the tone of what we heard from the noble Lord, Lord Stoddart. I also oppose this amendment.
Lord Radice
I am going to say something nice about the noble Lords if the noble Lord, Lord Pearson, will be quiet. I oppose the principle of the amendment because I do not believe that it should be written in the Bill that we ought to have referendums when countries join. That is not only a question of practicality; Parliament should decide this issue. The French have referendums if the Government and Parliament decide that something is not part of their constitution. Here I come to my compliment. In an odd way the noble Lords, Lord Stoddart and Lord Pearson, have done the House a service as they have once again highlighted the very curious nature of this Bill. On the one hand we have 56 policy areas that trigger referendums, and we have all had great fun pointing out that some of them are rather minor issues. On the other hand, on the big European issues of enlargement and membership of the European Union itself it is not written in the Bill that if we want to leave the European Union we have to have a referendum. I would have thought that a Eurosceptic Government might be interested in that but the Government have very sensibly not gone down that road, perhaps because they are in a coalition with the Liberal Democrats. I do not support this amendment, but its movers, my old friend Lord Stoddart and the noble Lord, Lord Pearson of Rannoch, have done the House a service as they have reminded us once again of the gross inadequacy of this Bill.
Lord Pearson of Rannoch
We are in Committee and I do not think that I even have to say, “Before the noble Lord sits down”. I was going to thank the noble Lord for the compliment that he paid my noble friend and me, but is he aware of one of the very few jokes about the European Union that is going about in Eurosceptic circles? I ask this given that he extolled the virtues of democracy which the EU brings to its new members. The joke is that if the EU were to apply to itself to join the EU it would fail on the grounds of its total lack of democracy, its bureaucracy with its monopoly on proposing new legislation—what body that pretends to be vaguely democratic can do that?—and, as we know, the secret process with COREPER, the Council and so on. How can he extol the virtues of the EU’s democracy, given that background?
Lord Lamont of Lerwick
My Lords, I frequently agree with some, but not all, the views put forward by the noble Lord, Lord Stoddart. However, on this occasion I agree more with some of the points made by the noble Lords, Lord Radice and Lord Richard. I agree that enlargement has been a positive development. Indeed, if you have an organisation called the European Union, it is unthinkable that you should exclude from it countries that before the advent of communism in Europe were part of the European family of nations, many of which had living standards and political systems similar to those in western Europe.
Some years ago I took part in a debate on the European Union with my noble friend Lord Brittan, who I am pleased to see sitting beside me. I think that the debate took place in 1993 or 1994, and I remember that my noble friend attacked me because I had not said a single positive thing about the European Union in my speech. I could not think of a single positive thing to say about the European Union at that time. However, if I took part in another such debate with my noble friend, I would say that enlargement is a considerable development that has been advantageous to the countries that have joined and to Europe generally.
If I may say so, the noble Lord, Lord Richard, made a good point that slightly bothered me. I support the Bill, but he said that within the logic of what he called this “crazy Bill” there surely ought to be a referendum on enlargement, given that we might have a referendum on altering the procedures for the appointment of a public prosecutor and other matters that the noble Lord regards as rather marginal. I was bothered about that question, and I have been sitting here for 20 minutes trying to think of an answer. It is that in those areas where they say there should be a referendum—including matters such as altering the procedures or powers on the appointment of a public prosecutor—the Government do not actually intend there to be a referendum, because they do not intend that such propositions should advance further at all. The Government are trying to put a lock on the issue and to stop it happening. They are drawing a red line on legislation for the immediate future, whereas they are in favour of enlargement, and that is why they have not applied the lock or the referendum provision to enlargement.
Lord Richard
My Lords, I am terribly sorry that I gave the noble Lord 20 minutes’ thought. Nevertheless, may I put a question to him? If the Government have no intention of using these powers—which is what he is saying—why on earth are they in the Bill? What is the point?
Lord Lamont of Lerwick
It is not a question of not using the powers; they are there to serve a purpose. The Government have indicated that they will not move further forward in any of these areas and they are enshrining in legislation obstacles to this ever happening in the future. Given the competence creep and the way in which power has seeped directly and indirectly, openly and less openly, to Brussels, I totally support the Government’s objective, and I have given the best answer that I can think of to the noble Lord.
Lord Taverne
If my noble friend is saying that the present Government are not going to use these powers, the conclusion is surely that the Bill is intended to affect not the present Parliament but a future Parliament. Is that not totally unprecedented?
Lord Lamont of Lerwick
I do not accept that. I agree that it is designed to have an impact on the future and to prevent the creep of powers to Brussels. That is wholly right, because we have seen again and again how power has gone to Brussels, sometimes by indirect means and sometimes by means that some of us regard as questionable. We have seen again and again how referenda results have sometimes been rejected, and questions have been put again and again to the people of other countries until we had the right answer. This Bill is trying to say that we should not have a further transfer of powers, that we have had enough of those transfers, that there are plenty of powers to deal with problems that arise, and that we do not need any more powers as all the tasks of the European Union can be addressed through existing powers. We are therefore drawing a line in the sand, as long as there is a Conservative Government or a Conservative-Liberal Government. Future Governments can, of course, choose to repeal this legislation if they want to. That is their prerogative. We will, no doubt, address the sunset clauses later, but I do not go along with them. It is perfectly legitimate to state, “We are passing this legislation now and we intend it to remain”.
Lord Lamont of Lerwick
I am anxious to sit down, but I will give way to the noble Lord.
Lord Tomlinson
Perhaps the noble Lord can help me. He explained that in a number of areas power had gone to Brussels by what he described as fairly dubious means. I have not had the benefit of 20 minutes’ thought about that, but I cannot, offhand, think of any such example. Can he give me a couple of examples of what is worrying him about the dubious means?
Lord Wallace of Saltaire
The noble Lord is speaking from the Gangway and is therefore not in order.
Lord Lamont of Lerwick
I would say that the setting up of the European financial stability mechanism using Article 122 of the TFEU is extremely questionable. I am deeply puzzled how that can be regarded as in accordance with the treaty, but I am sure that that matter will be raised at some point later during our proceedings.
Lord Dykes
My Lords, I suggest that my noble friend Lord Lamont was doing himself down when he referred to 1998 and possibly earlier periods when on the debates that were always going on about Europe he had not given any illustration of being in favour of much to do with the European Union. I remember that in the 1970s, he, like others of us, was an enthusiastic European. I cannot remember the exact years, but I believe that that was the case. He was doing himself down, because I vividly remember—I stand to be corrected, but I believe that my memory is pretty safe on this and I am happy to look at the Hansard reference as soon as I have the chance—that in the early 1990s, when he was Chancellor of the Exchequer, at one stage he said, “Of course, when you are a member of a club, you have occasionally to do what the other members want as well”. I thought that that was a rather impressive way of saying that he was in favour of some aspects of not only international co-operation in general, but the international co-operation that comes from the mechanisms—the integrated parts of the structure and the sovereign government parts of the structure—of what was then the European Community and is now the European Union, enlarged and with Lisbon as its basic fundament.
That is a phenomenon that we witness in the case of the present Foreign Secretary and others who were viciously anti-European in all sorts of aspects. We remember the role of William Hague when he was leader of the Conservative Party in opposition: his “10 days to save the pound” campaign and his attitudes then. Inevitably, in government, his attitudes have become more modulated as a result of both the basic requirement of working with colleagues, partners, fellow Ministers from other countries in all the European Union mechanisms and the logic and common sense of always garnering general support from the public. The idea that there is huge anxiety in this country about competence creep, mission creep, the European Union taking over too much or the Commission becoming overmighty is to my mind grossly exaggerated. There is very little evidence of that. As we said on Second Reading, it is a campaign that has been got up in the press and by a small number of very anti-European politicians of all kinds, mainly in the Conservative Party and UKIP, but also politicians outside Parliament. We think of the BNP and other rather dubious organisations in that context as well.
If we could gauge the attitude of the public, it is one of general acceptance of all these matters. This debate has been going on for some time both in the Commons and here, and it is interesting to note that there has been no public reaction of support for the Government. I do not think that Ministers could cite messages that they have received from the public saying, “Thank you very much. You’ve done a wonderful job. We are so glad that you are resisting the encroachments of the Commission”. I do not want to upset the Minister by going too much into Second Reading points, because this point was made then by several speakers, but can we get away from that canard?
The Commission remains in number of both officials and senior officials a very modest sized body, despite enlargement. It gets the general support of the European Council and the Council of Ministers, because it does a very good job with all the difficulties built in of blending 27 national cultures of public finance and administration. That is a complicated task and it takes time to get habits to coalesce in joint working. None the less, there is no sense that the Commission is exceeding its powers or has done too much in any way with either the connivance or the resistance of the member Governments. Indeed, apart from its own delegated powers, which are either from the treaty or from the exhortations and requests of the various ministerial Councils, the Commission is a modest part of the total.
The main panoply and structure of the European Union remains the sovereign member Governments in the European Council and the Council of Ministers making their sovereign decisions collectively, enhancing both the individual sovereignty of every member state participating automatically and the general sovereignty of the European Union itself. That is why common sense among the public accepts that as a natural process.
Lord Clinton-Davis
When I was a Commissioner, we made it imperative to listen to the many people who had views about Europe, and I think that that continues today. Is that not an expression of faith in the democratic process by the European Commission?
Lord Dykes
I am grateful to the noble Lord for that intervention because it reminds me of the series of visits by individuals and groups—schools, universities, students, blue-collar workers, white-collar workers, business community groups, trade unions and all sorts of public and private institutions—not only to the European Parliament but to the Commission to see how they work. Taking Eurosceptic and anti-European individuals from the British Parliament on their first visit to Brussels, I have had the personal pleasure of witnessing how they change their mind when they see how it works. It is in no way a threat to our country.
Lord Flight
I thank the noble Lord for giving way. In view of his assessment of public opinion, is he therefore a supporter of having a referendum on staying in or not staying in so as to resolve the issue once and for all?
Lord Dykes
I assume that my noble friend was present during the Second Reading of the Bill.
Lord Dykes
If my noble friend looks at the report of the Second Reading in Hansard, he will see that that point came out a lot. Many speeches on this side of the House, as well as on the opposition and Cross Benches, were very much against the referendum concept, particularly in the Bill but also in general. There is widespread anxiety about it in this country, which I share. The noble Lord, Lord Garel-Jones, recently said publicly that he was against referenda of all kinds. He is not here today—he is abroad this week—but he told me that he is very sceptical about referenda and their misuse. The whole of Parliament has been undermined by this obsession—this referendumitis—and it is therefore essential to try to get away from it or to have referenda only on crucial occasions. That is what I consider to be the very respectable reserve position of the Liberal Democrat Party. I believe that some members of the opposition Benches and some Cross-Benchers share the view that we should have referenda only on crucial existential occasions and not on other things.
I must not tax the Minister’s patience—he is a very patient person—by making too many general points but they do take us back to the amendment of the noble Lord, Lord Stoddart. The best way to undermine Parliament is to say that we are going to badger the British public all the time and ask them about these minor points. Of course, accession is not a minor point but we discussed minor points in previous Committee sittings. Accession is a more major matter and therefore the noble Lord, Lord Stoddart, is correct to say that it is illogical not to include it as an item on which a referendum should be held. However, I am glad that on this occasion, in their wisdom, the British Government have decided that it should not be on the list of such items. I only wish that they would kindly consider a lot of the other matters that we have been discussing—particularly the Article 48(6) list of items under Clause 4.
We will find that Clause 6 is even more obnoxious in its menacing effect on Parliament, even though Parliament will still be involved in the decisions. Of course, if there were an accession matter to be decided, under the existing suggestions Parliament would have the right to hold a referendum if it thought that it was correct to do so. However, I hope that that will not be the case, and I think that a lot of people will now have second thoughts about this referendumitis.
We should remember that huge, earth-shattering decisions have been made by this Parliament—one of the greatest Parliaments in the world—on matters ranging from the Second World War, joining NATO, the atom bomb, the formation of the UN and, before that, the League of Nations and the First World War. All those matters were decided by Parliament, as is the British tradition. It is not the British way to say, “Dear hapless members of the public, we want you to make a referendum decision on whether we should have more passerelles and what you would like to be included in those passerelles”. That would be the big society gone mad in European terms and I hope that we will get away from that.
I think that sometimes the noble Lords, Lord Stoddart and Lord Pearson, are unfairly attacked in this House. They are entitled to their views, although I think it is sad that they persist in wanting this country to be on its own and not be a member of the European Union. That is very sad for them personally, as well as being a matter of policy and viewpoint; none the less, in all the amendments that they will be putting forward from now on, they deserve to have a proper and respectful hearing in this House.
Lord Triesman
My Lords, I express my appreciation to all noble Lords who have spoken in the debate so far. I suppose I should apologise for having risen too early to make this intervention. I would have denied myself some 20 minutes of edifying discussion.
I start by making it clear that we oppose the amendment. It is entirely possible, as my noble friend Lord Richard, and the noble Lord, Lord Lamont, have said, to see exactly why it has been moved. The credibility of the amendment rests in large part on the worst provisions in the Bill. In many respects, the Bill is illogical and intrinsically foolish. Many of the 56 or so bases for holding a referendum would be almost incredible in any mature democracy and those provisions litter the Bill. I understand its function in placating some of the harsher critics of Europe. I suppose I take a little comfort from the view of the noble Lord, Lord Lamont, that many of the provisions would never be used even if they were carried, but I think that it is hard to fathom the Government’s intentions on the lock, as with much else in the Bill. The provisions have been made, if I may say so, without any sensible notion of proportionality or practicability and, as I have no doubt further debates in the House will illustrate, they would remove or abandon, in many instances without good or sufficient reason, the full and proper role of Parliament in the kinds of discussions that we would normally expect to have on such provisions. Yet on the issue which might have very significant implications —my noble friend Lord Richard made the point a while ago—the use of a referendum is specifically excluded.
When I thought about what should be said at this stage in the debate, I also went back to the founding treaty, as the noble Lord, Lord Hannay, did, and to the provisions that it made and the rights which it introduced for enlargement. Like him, I thought hard about the consequences on our international relations were we to exercise some form of veto as a systematic way of undermining the founding treaty. The founding treaty is far more eloquent and far more reliable than President Chirac's view of it, which was known to change from time to time.
I want to dwell, as others have, on the value of accession. The economic advantages, the anti-corruption measures, the rule-of-law measures, the role of civil-law measures, the development of courts and proper civil-law coding and the democratic principles have all been absolutely fundamental in all countries seeking to join the European Union. As my noble friend Lord Tomlinson said, by no means all of them fall backward in the economic area—many of them are wealthy and very successful countries—but some of them, without question, have fallen backward and have a chequered history because of the political regimes within which they have been forced to live for so many years.
A fundamental point which was made by my noble friends Lord Radice and Lord Dubs is absolutely right: enlargement has been a huge success. The process undertaken before countries join the European Union has driven consistently for better outcomes and for outcomes which have been more willingly embraced. Old enemies and ancient antagonisms have largely been removed. Going back a couple of years, I can remember thinking hard about the ways in which a war-torn Europe—most of its history it has been war torn—has been moved significantly into a peaceful Europe of nations which co-operate with each other and which have a great deal of mutual interest in each other's economic, political and social success.
As the noble Lord, Lord Stoddart, correctly listed the countries that are seeking membership, I thought of the names of many of those countries and remembered that it was not that long ago that we read about those countries largely because of the wars that were taking place, for example in the former Yugoslavia, and the continual history of appalling violence and degradation of human rights. Broadly speaking, we do not talk about those countries in that way any more. We have seen development to a point where they are more concerned with the acquis than with killing each other. That has been a fundamental change in one of the most difficult and troubled regions of Europe, and an enormous success. The process has policed, assessed and evaluated progress.
Lord Dykes
I will be brief. The noble Lord referred to the acquis. Would he not say how ironic, interesting and bizarre it has been that many anti-Europeans in this country welcomed artificial enlargement as a way of loosening and widening rather than further integrating the Union, and yet all the applicant countries accept enthusiastically both the concept of the acquis and that of future integration?
Lord Triesman
My Lords, the observation is completely accurate and adds weight to the point that I make, namely that it is in these areas where people are trying to work through the provision of stable legal systems and better democratic systems that we have seen the replacement in many cases of conflict between those states. That is a huge success.
Of course, we have supported accessions from their initiation through to full EU membership. Major parties on all sides of the House have done so, despite the inconveniences that have sometimes occurred but which were minor in the overall context. I say to the noble Lord, Lord Pearson, that not all these gains can be washed away by tales of cynicism, whisky, chocolates or anything else. By and large, in my experience, people have sought the gains because they have wanted a better and more peaceful life, and have wanted their children to enjoy a better future.
Lord Pearson of Rannoch
My Lords, can the noble Lord name a single European country that would have gone to war with another since 1945 in the absence of the project of European integration?
Lord Triesman
My Lords, I was going to go through one or two. Certainly Serbia will serve the purpose. A number of countries in the region, for one reason or another, went to war. It was only when a different kind of future was offered to them that they began to think about the alternative future that their children might enjoy which did not involve shooting each other.
I understand, in debating the amendment, that the issues that I have raised are not supported everywhere or by everyone. I take the point of the noble Lord, Lord Stoddart: I regard the movement of labour in a free market as broadly beneficial, but I know that not everybody thinks so. Many people have expressed anxieties about it. This has been one issue that has come out of part of the accession. I believe that, broadly speaking, it has been economically advantageous to Europe rather than the contrary. However, I accept that many people who expressed anxieties were dismissed in a trivial way or saw their anxieties given grudging attention. Probably that did not serve the argument well.
Some people may have felt that changes of that kind were sufficiently profound that they wanted a say in the decision through a referendum. More than that, I suspect that they felt the need for some sort of shout about the overall size of the EU. For all that, were they to contrast the prospect of having a referendum on those questions with the ideas in the Bill about having a referendum on many minute, technocratic and in many instances unintelligible provisions, probably they would think that some of the issues raised by the noble Lord, Lord Stoddart, were more important than others. It would be foolish of us not to recognise that.
I suspect that some of the same arguments could happen with the Turkish accession. Let me be clear that we—certainly I do—totally support it. I welcome the dynamism that it represents. I also have no hankering for a Europe that is built around a single religious tradition—a view which has been expressed by many of the Eurosceptics and, indeed, in some European capitals. It would be a huge gain to see Turkey as a full member of Europe. It is absolutely right, as the noble Lord, Lord Tomlinson, said, that it has always played a fundamental role in the Council of Europe. This would be a huge gain for Europe in a much more profound sense—a Europe that is welcoming and able not only to cope with, which is probably too derisory a way to put it, but to embrace a major secular but also Islamic nation with a capability of bridging the interests of Europe, the Middle East and the Caucasus and bringing a great deal to stabilising the discussion right around the southern and eastern flank of Europe.
Whatever the merits that I might express about it, I know that those merits have been accepted by all recent United Kingdom Governments. However, there remain people—it has been something of a cause in France and Poland, for example—who believe that Turkish accession would have a major impact on the style and culture of the European Union. I think that the noble Lord, Lord Stoddart, described it as the ethos of the European Union. I look forward to these evolutionary changes regardless of whether others have expressed doubts. However, among those who have expressed doubts, some will probably feel that there will be an impact on them—a greater impact than some of the things that will be subject to referenda under the Bill’s provisions—and that they are not being asked their opinion.
The Minister will probably want to explain to the House the difference in approach and the apparent irrationality of the circumstances in which people will be asked for their view as between the different kinds of categories of issues at stake. The amendment draws the wrong conclusion. However, it cannot be said that the issue that it raises is inconsequential. Nevertheless, as I said at the beginning, we are opposed in principle, and we are. It would be better to remove the requirements for so many of these trigger clauses for referenda without providing any compelling definitions of issues of major constitutional importance and without an independent means of confirming the compelling nature of the decision.
It would be very helpful if the Minister could also comment on the point made by the noble Lord, Lord Ahmad, about what would happen were there to be a number of countries seeking accession at the same time. I will not invite him, however, to develop a new theory of AV which might allow for multiple voting—an outcome which probably everybody would fail to understand.
I can also see one other great risk in the kind of referenda that this amendment calls for, and that is in the area of producing campaigns which could very well be xenophobic and draw out the worst in relations between those seeking entry to the European Union and the domestic community of the United Kingdom, not least because many of those communities already in the United Kingdom are dynamic and vigorous parts of the society of the United Kingdom. The tensions that could be produced by that kind of approach would be quite unacceptable.
I also believe that accession does not transfer powers from the United Kingdom and that the House would do itself a considerable favour by recognising the beneficial characteristics of the growth that we have seen, a benefit which will unquestionably continue. As we look across the whole of the achievement of a peaceful European Union, I suspect that that will be seen historically to be one of the better departing points in our history.
The Minister of State, Foreign and Commonwealth Office (Lord Howell of Guildford)
My Lords, I begin by welcoming the noble Lord, Lord Triesman, to the forefront of the Opposition's concerns about this Bill. I think that he and I exchanged views from the Dispatch Box during the passage of the Lisbon treaty. We covered a great deal of ground then, and I think that we learnt a great deal from that process. Indeed, the British people learnt a great deal from the Lisbon treaty process, as did the whole of Europe. I look forward to lively debates with him in the future.
I have to say in parenthesis that should this Bill become law, the future will not be at all as the noble Lord describes it. The picture of a dribble of referenda on small issues completely misunderstands the way in which the European process works now or will work in the future, whether this Bill is on our statute book or not. I have obviously explained that insufficiently because the message has not got over, but as we continue our debates I hope to be able to make clear that the pattern will not be dissimilar to the pattern of the big treaty packages in the past, the difference being that if they contain matters that might look small but could be highly significant for this nation because they involve a transfer of competence or powers beyond the level of insignificance, that certainly requires consulting the British people. That is a very widespread view which this Government believe is important to satisfy in order to build a better consensus for the European Union than we have today from the British public.
However, that is for other debates: debates that we have already had and debates in the future. On this issue, we have had a very elegant exchange on the two sides of the argument. It is a debate in which the Government’s position is quite clear, as I shall make plain in a few moments. I find that when your Lordships tackle this sort of issue we put up a superb performance and all sorts of aspects are developed that do not necessarily emerge in the pattern of debates in the other place.
The amendments would alter Clause 4 to create an automatic requirement for a referendum in the UK to approve the accession of a new member state to the European Union. As your Lordships know, the UK has never required a referendum on accession treaties in the past, and this Government have been clear that there should be no referendum requirement merely for the accession of any new member state. That was the position also taken by the previous Government, of which the noble Lord, Lord Triesman, was a member. Why is that so? The simple point is this: the accession of a new member state alone does not constitute a transfer of competence or power from the UK to the EU. The transfer of powers or competence to the EU would be from the member state joining the European Union, not from the UK. Of course, there are some effects, possibly including a change in bilateral relations if a country becomes a member of the European Union. No one disputes that, but we are not really talking about effects or impact; we are talking about the transfer of powers and competences.
I apologise if that sounds narrow, but that is the limitation of the provisions of the Bill. Of course, we are aware of the need to avoid providing a loophole in our referendum provisions in case there is a proposal to use an accession treaty to transfer power or competence from member states other than the acceding state. That could occur, so this Bill provides for a clear requirement for a Ministerial Statement to be laid before Parliament about whether an accession treaty constituted a transfer of competence or power from the UK to the EU in accordance with Clause 4. If the Minister decided that such a transfer was proposed, a referendum would then be required, but if there was no such transfer no referendum would be required. I hope that reinforces the point that I was making earlier.
Lord Hannay of Chiswick
My Lords, as the Minister has touched on this point so clearly, will he make it quite categorical that if a Croatian treaty of accession in the next year or two is brought before Parliament and it contains the provisions on Ireland and the Czech Republic that were agreed as part of the ratification process of Lisbon, in which it was stated, by us as well, that they will be included in a future accession treaty, that will not give rise to a referendum requirement?
Lord Howell of Guildford
If one is talking about declarations or derogations within existing treaties and competences, that would not give rise to a referendum. If it was an occasion on which a whole range of new proposals were put forward, including some of those which noble Lords describe as minor or even trivial but which could in fact have highly significant effects on the powers, potentials, freedoms and obligations of this country, that would be a different matter. The kind of changes suggested by the noble Lord would not give rise to a referendum.
In line with all other treaty changes, an Act of Parliament would—
Lord Davies of Stamford
I am very grateful to the noble Lord for allowing me to interrupt him. This is a very important point. If the Bill is passed in its present form with its text unamended, is he confident that it could not subsequently be argued—if there are going to be judicial reviews of ministerial decisions on this matter—during the accession of a new member state that the mere fact of accession reduces the powers of this country because it dilutes our voting strength in the European Union under QMV and for other purposes?
Lord Howell of Guildford
It does not dilute our power to veto. Our power to veto is there unless it is removed by other transfers, which of course would trigger a referendum. However, if the power to veto is there, there is no dilution. We have heard from noble Lords who have spoken in this debate of the small but undoubted change in the proportion of the population of the total European Union that would result in this country if a number of other countries acceded. That is true, but the veto remains. There has been no transfer of power of any description or kind, which is what this Bill is concerned with.
I also wanted to say that any accession treaty provides Parliament with the full power and the opportunity to scrutinise the accession treaty, which we have done in the past. If it was so minded—a point that meets the concerns of the noble Lord, Lord Stoddart—a Parliament could legislate for a referendum. It remains the power of Parliament to do so. It is perfectly free to say, “Here is an issue on which we think there should be a referendum”.
Lord Taverne
Is the point made by the noble Lord, Lord Davies, not correct? If an accession reduces the voting power under majority voting procedure of the UK, that must mean a decline in power of the UK Parliament.
Lord Howell of Guildford
It does not alter the fact that the United Kingdom will continue to have a veto, as other countries will, unless we surrender positions of unanimity by abandoning our veto. That would be the position. It is perfectly true that there would be very marginal and small changes in the pattern of weighting, but there is no particular reason why they should involve a loss of power or a transfer of competence. They do not do so. The noble Lord, who is very experienced in these things, was talking about patterns in which all sorts of alliances are formed or not formed. All sorts of gatherings and countings of votes take place when Ministers go into these negotiations. That will continue as before. The accession of another country does not alter that pattern in any way.
The noble Lord, Lord Pearson, asked about the ways in which immigration or financial regulations might be affected by the arrival in the European Union of a new member state. He will recall that when Bulgaria and Romania joined the EU, we put transitional arrangements in place. We had the perfect power and legislative opportunity to do so, and we can do so again. Nothing in the treaty of accession prevents us from doing so and nothing has prevented us from doing so in the past.
I emphasise, as the noble Lord, Lord Triesman, and other noble Lords have asked me to, that, as with all previous Governments regardless of their political composition, we are strong supporters of future enlargement. Like some noble Lords, I remember the considerable uplift in spirits when first there was the fall of the Berlin wall and the Soviet empire and then when the processes of enlargement embraced one after another of its former satellite countries. We all worked, planned and hoped for these things. Some of us thought that we would never see them in our lifetime, but they did occur.
EU enlargement helps to create stability, security and prosperity across Europe—we have never disputed that—and serves to spread democracy, human rights, the rule of law and fair rules for workers and businesses. These standards are high although they are not always achieved. I am grateful to the noble Lord, Lord Pearson, for reminding us of a joke—which, frankly, I had heard before—about the standards of the EU itself. The EU is not, of course, a country; it is a vast confederal structure. It is a unique institution in the 20th and 21st centuries but it is not a country, and perhaps it is a little distorting to suggest that it should be judged in the same way as a nation state. However, that we favour enlargement in the way in which it has come about so far—and in the way in which it might come about in the future—should not raise one iota of doubt for a single minute.
Whenever a candidate country meets the EU accession criteria and it is decided that it is ready to join the EU, we will support its entry. The Government will present its case to Parliament through the introduction of a Bill that will be debated in both Houses and passed or not passed into an Act according to the will of Parliament.
I have little to add to the strong points that have been put by a number of noble Lords as to the fact that transfers of powers and competencies do not arise in the precise form in which we are dealing with them in the Bill; there is no competence or power transfer. The commitment in the coalition government programme for government is to have a referendum on treaties that change a power or competence from the UK to the EU. Treaties that merely allow a new country to accede do not meet this requirement. On that basis, I urge noble Lords to consider what I have said on this matter and to withdraw the amendment.
Lord Stoddart of Swindon
I thank all noble Lords who have taken part in the debate, particularly those who supported the amendment—the noble Lords, Lord Pearson and Lord Willoughby de Broke. I confess that I did not think there would be a debate of nearly an hour and a half on my amendments; I thought they would be dealt with very swiftly. I am pleased that I tabled the amendments because we have had a well considered and authoritative debate on the subject, whatever opinion we hold. That has been altogether good. I would like to reply to all the points that have been made but, including my own speech, there have been 15 speakers—the equivalent of the number of speakers in normal short debates that are two and a half hours long—and I am sure that the House would not welcome a long speech from me in these concluding remarks.
I say to the noble Lord, Lord Pearson, that I was interested in the way in which the Estonians were bribed, so to speak, to vote in the referendum with whisky and chocolates. I am sure that the Scots would be pleased that their product was being used in that way. I visited Estonia shortly after the referendum. It seemed, from the general view of the population, that they regretted the decision that they had made and wished that they could go back on it. That is by the by.
It has been a good debate with some important issues raised. Although the noble Lord, Lord Richard, does not support the amendment, he made a valid point that if we are going to have referendums on some rather less important things—public prosecutors and what have you—there is little merit in raising the question of having referendums on more major matters. That was taken up by several other noble Lords. It is clearly important that we realise that the Bill is deficient in many respects.
On the question of referendums, there appears to be a lot of opposition to referendums per se. That opposition is perhaps on the basis that those who do not want them believe that they cannot win them. That is a big mistake. We have referendums on all sorts of things such as mayors. The objective of having them is to give people a say on major items. I stress that it is on major items. We should not rule them out of our decision-making process.
Another point was raised by the noble Lord, Lord Triesman. I, too, welcome him to his new post on the opposition Front Bench. He may well be right to claim that the European Union has given us nothing but benefits. The noble Lord, Lord Pearson, and I have asked repeatedly for a cost-benefit analysis of our membership of the European Union. I hope that the noble Lord, Lord Triesman, might support the next Bill which asks for a referendum.
Another point was made by the noble Lord, Lord Howell, who suggested that we should not have referendums on the accession of new members because there are no new competencies. As I pointed out in my opening speech, the accession of new members has often if not mostly been the reason for new treaties transferring competencies to the European Union. In that respect, new accessions may well result in new competencies being given to the European Union and its institutions.
I again thank noble Lords for contributing to a good and essential debate. I do not intend to press the matter to a Division this afternoon but, after reading all the contributions to the debate, I might wish to bring the matter forward again on Report and perhaps even put it to a vote. In the mean time, I beg leave to withdraw the amendment.
Lord Liddle
Lord Liddle
My Lords, I readily confess that in the annals of arcaneness this is a very arcane subject for an amendment but it is not the fault of noble Lords on this side of the Committee. The fact is that this is an extremely arcane Bill with provisions of mind-boggling complexity. Therefore, if we are to address it with proper scrutiny we will inevitably end up moving arcane amendments.
In simple terms the purpose of Ministers is, we have been told in this legislation, to detail every possible transfer of power to Brussels and bind it in the form of some indestructible referendum lock, which will last at least for this Parliament and probably a long way beyond. Their argument is that this is necessary to restore public trust in the European Union. This proposition is made without any real evidence being offered that this is an effective means of restoring trust in Europe. I could argue with equal force that a more effective European Union would be a better way to address this problem. In making the argument that we need these multiple referenda, the Government are launching the greatest attack on the sovereignty of Parliament that we have seen in recent times. The noble Lord, Lord Stoddart, argues that those of us on this side of the Committee who find the multiple referenda proposed in the Bill objectionable do so because we are frightened of losing. We are not frightened of losing but we stand for parliamentary sovereignty and representative democracy, and this Bill is a denial of those principles.
The second point is that the situation in which this Government intend to put their Ministers is profoundly against the national interest in dealings in the European Union, because it denies Ministers the pragmatic flexibility to agree to passerelles in the Lisbon treaty or to small changes which will enable Europe to be more effective and to win back that trust. The consequence will be not to stop things happening but that the rest of the European Union, if it thinks the issue sufficiently important, will go ahead without Britain being involved. For good reason or ill, the United Kingdom is already out of the euro and out of Schengen. We on this side of the Committee believe that the consequence of the Bill will be to put us out of virtually all areas of expanding EU activity. It will marginalise Britain in Europe and deny the British Government the power to tackle problems that the nation state on its own cannot tackle. This is not just a matter of applying a lock to change; it is also throwing away the key.
On previous days in Committee, we have argued that this extreme position that the Government have adopted on the referendum lock can at least be modified in a number of ways. In our previous day in Committee, we argued from this side that where changes need to be made on grounds of urgency they should be permitted. We also argued that the significance test, which is included in the Bill and which allows Ministers to decide that—
Lord Howell of Guildford
I certainly do not want to make a habit of too many interruptions, as we all know that debate in this place goes more smoothly without, but the noble Lord has made a number of statements which jar so strongly with the reality that I have to ask him what he means by them. He says that the passerelle and other arrangements in the Lisbon treaty would enable rapid changes to be made but we all know that any treaty, including the one now going through, takes 21 months. How can 21 months possibly be described as rapid? Furthermore, he seems to assume that the efficient and effective operation of the European Union demands all kinds of new treaties and to ignore the fact that within the vast range of competences that it has, a great deal can, must and will be done. Countries throughout the European Union are extremely reluctant to embark upon the complex, long process of European treaty change. These are all facts and they contrast completely with what the noble Lord has said in the past five minutes.
Lord Liddle
The Minister has misunderstood what I have been trying to say. I apologise to the Committee if I have been giving a false impression but this amendment’s subject encapsulates fully the point that I am trying to make. What concerns us is: why tie up all the flexibilities that are within the existing, ratified structure of the Lisbon treaty, which were discussed in this House in the previous Parliament? Why tie all of those up in referendum locks that could have a very negative effect on Britain's power to act in its own interests within the European Union? That is the point and this amendment looks at one of those specific and unnecessary locks. Let me try and explain its point.
Clause 4(1)(m), which we debated last week, requires an automatic referendum if any amendment is moved to the Lisbon treaty, as it could be within the terms of that treaty, to alter the right of member states to ensure suspension of the legislative procedure. In Euro-speak, this is called the emergency brake and covers three areas of EU activity: social security, judicial co-operation and cross-border crime. It is the right of a member state to refer a matter where legislation is proposed in those areas to the European Council before the legislation can proceed any further. Britain supported emergency brakes in these areas in the passage of the Lisbon treaty. It did so because the previous Government thought that as regards social security, judicial co-operation and cross-border crime there might well be an argument in principle for more Europe. Indeed, there were compelling arguments for more Europe in this area but as a safeguard, just in case we did not like the look of the way things were going, we wanted to see how it worked. Therefore there was a need for an emergency brake.
The logic of this very pragmatic position is that if we find in future years that the European Community is doing a good job in these fields, we will be prepared to rid ourselves of that emergency brake provision. Those who are disposed by nature to see everything that the EU does as a threat will never believe that anything can work, but those of us who think that it can be an opportunity should be open-minded about the possibility of the changes that are provided for in the Lisbon treaty.
I argue that these three areas are issues that are not of the highest national importance, like whether we join the euro, but are of significant importance where change might be necessary in processes that the Government might want to agree to. However, the Bill will require an automatic referendum. Look at them: first, social security legislation, which, as we know, is tied up with the right to work, study, and settle for retirement wherever you want in the EU, which is one of its most appealing citizenship rights; secondly, judicial co-operation, which is essential if we are going to effectively tackle the terrorist threats of the kind that the noble Lord, Lord Strathclyde, talked about earlier in his Statement on Osama bin Laden; and thirdly, cross-border crime, in terms of which we are all aware of the increasing problems of criminal gangs operated from outside the EU but often on its borders, in countries like Russia and some parts of the Balkans.
Surely we want to retain the flexibility to make Europe effective in those areas. That may require changes in these so-called emergency-brake provisions but, on a narrow but significant point, the Government are saying, “Oh no, we can’t do anything for at least seven years or so because we have to have a referendum and we are certainly not going to do anything about that this Parliament”. The argument from this side of the House is a different one: let us not tie ourselves up in these knots but have the confidence that in a representative democracy Parliament should deal with these questions; there is no place for a referendum on them.
Lord Blackwell
My Lords, I must apologise to the House and the Minister for having been unable to contribute to the debate on the Bill so far. I feel compelled to contribute at this point by the extraordinary speech of the noble Lord, Lord Liddle.
When the Government of the day brought the Lisbon treaty to this House, one of their proud claims was that they had protected the red lines that they had set out, including the red lines on areas such as social security and judicial co-operation, through the introduction of these emergency brakes. If legislation was brought forward in the European Union that was seen to be against our national interest in these areas, or against things that we could tolerate, we had the right to say, “We will not go along with this. We don’t think this should be applied to the UK”. Effectively, we have a veto. The other member states can proceed without us if they wish, but it gives us a cast-iron guarantee that in these very sensitive areas the EU cannot override the UK Parliament and the UK people in legislating in what are regarded as areas of national importance. For the noble Lord to say that we should now throw these emergency brakes away—
Lord Liddle
I am not saying that at all. I am saying that we should not tie ourselves up indefinitely in the need to have a referendum to make this change. That does not mean that I am in favour of immediate change in these things; I am not. But I want to hold open the possibility of flexibility in order that we can meet new circumstances if necessary.
Lord Blackwell
I am grateful to the noble Lord for his clarification. However, he talks about trust, and I have to say to him that the reason why the British people have lost trust in politicians to represent them in Europe is that over many years they have seen politicians stand up and say, “Minor changes. These won’t affect you”, but cumulatively those changes have added up to a huge shift in powers.
These brakes were put in the treaty, which was agreed by Parliament. The noble Lord may not want to remove them this year, but when does he want to do it? If he wants to do it at some time, that would be a substantial weakening of the current treaties. In the spirit of the Bill, which I wholly support, I regard anything that removes a veto or anything akin to one as a major change to the treaty that should not be carried through by Government without the provisions of the Bill requiring that as a major change it should be put to the people in a referendum.
In his speech, the noble Lord attempted to confuse the House by suggesting that the referendum would make it difficult for the UK to use these powers. I should make it clear—the Minister can correct me if I am wrong—that nothing in the Bill requires a referendum for the UK to use, or not to use, the emergency brake. The Bill is entirely silent about the use of Articles 48, 82 and 83. It simply says that if the EU seeks to amend the terms of the treaties under which we can use those emergency brakes, that will require a referendum. Whether or not the use of the emergency brakes itself required a referendum would depend on the substance of the matter that was contemplated being brought forward under those provisions, which would fall under other aspects of the Bill.
Removing the subsection, as the noble Lord is attempting to do, would mean that at some point in time a future Government could give away these vetoes without requiring that to be brought back to the people. That is exactly the kind of action that has led to the loss of trust of people in politicians and, unfortunately, in this Parliament, to protect them in this matter.
Lord Hannay of Chiswick
I am sorry that the noble Lord’s absence from earlier debates has not enabled him to catch up with where this debate has got to. Some of us were attempting to reduce sharply the number of provisions that require a referendum, for a number of reasons that are not the ones that the noble Lord, Lord Stoddart, gave but are related, as the noble Lord, Lord Liddle, said, to whether or not you believe in representative parliamentary democracy and the powers of Parliament. A number of us who have done so have put forward amendments that would effectively leave in the Bill the strengthening from the ratification of Lisbon powers, which means simply that if these changes were to be made there would need to be a resolution in both Houses, but would leave intact in the Bill a requirement for primary legislation before Britain could agree to that. That would be a strengthening of parliamentary authority in areas such as this, which in any case require unanimity. The idea that there is not a lock there is completely aberrant. What there is not, if you follow the amendments, is a lock plus a referendum, and that is for principled reasons that I have briefly attempted to explain. I am sorry to interrupt the noble Lord, but really and truly the situation is not quite as he suggests. Those of us who are trying to reduce the number of referendums are not trying to weaken the power of Parliament but to strengthen it.
Lord Blackwell
I thank the noble Lord for his intervention. Actually, I am fully aware of the nature of these amendments, all of which attempt to undermine the purpose of the Bill, which is to require a referendum if there is a major change to the treaties or a major shift in power. That is a principle that I fully support and which the noble Lord is attempting to undermine.
I hope that there will never be a referendum under the Bill because I hope that no Government will ever seek to transfer further power to the European Union in a way that would require the referendum requirement to be enacted. In hoping that we will never have such a referendum, I probably agree with the noble Lord. However, if we are going to restore the trust of the people of this country in the EU, we have to give them the cast-iron guarantees that the Bill provides and not undermine it in the way that the noble Lord, Lord Liddle, seeks to do.
Baroness Falkner of Margravine
I seek some clarification on the amendment of the noble Lord, Lord Liddle. It seems to wish to get rid of three emergency brakes but leave in place the one that includes the common foreign and security policy. That seems somewhat inconsistent; the noble Lord has mentioned several areas of co-operation where he believes it would be important, if the EU were to proceed in a manner that would be conducive to our interests, for us to do so. I suggest that the common foreign and security policy would be one area in which we have rather more expansive interests than in those of social security, judicial co-operation and cross-border crime.
Since the noble Lord gave a few examples, may I caution him on, for example, judicial co-operation? He thought that it may well be essential to have improved judicial co-operation if we are to tackle terrorist threats. That is an important point, but I also urge caution regarding the other direction. It is not that long ago that in this House the former independent reviewer of terrorism legislation, my noble friend Lord Carlile, warned us regarding the proposals for 60 days’ detention without charge that the previous Government wished to introduce. We must not go in the direction of the French legal system, for example, under which people have been interned for several years without charge. It cuts both ways: we may want enhanced co-operation but we may well not want it.
The previous Government negotiated the treaty and put in the emergency brakes. It is unclear what these moves would achieve and why that change of position has come about. Will the noble Lord reassure me on my understanding, which is that the Bill does not require a referendum before the EU can act in areas where the emergency brake exists? Co-operation is a good thing which can benefit the UK, but I thought that this was about making it clear to the British people that a referendum would be required if there is a move to abandon these important safeguards. Can the noble Lord explain what has caused this quite significant change in thinking?
Lord Pearson of Rannoch
There has been much support in our debates so far against referendums for all but the most important issues such as the euro, and the noble Lord, Lord Liddle, echoed that in his speech. The speech of the noble Lord, Lord Deben, comes to mind, and many others. As this is a theme running through so much of our debate, I felt that I should make just one comment.
To put it mildly, we, the political class, are not particularly popular. I fear I detect a feeling out there among the people, in many discussions and in many fora, that our system of representative parliamentary democracy has, to some extent, broken down, or at least that it is not the great instrument it was before, the one which was exported all over the world. I think that there is now greater support for more of a plebiscitary democracy. Our system of representative parliamentary democracy worked very well in the 17th, 18th, 19th and even early 20th centuries, when many, if not most, people could not read and often led lives of endless drudgery and when better educated people were elected to Parliament to take their decisions for them. But now the people can read and, on the whole, are just as good and capable as their politicians. I believe that something like the Swiss democratic system, with its referendums—not, perhaps, going quite as far as the Californian system, with its difficulties over tax and the rest of it—really is now the only way in which to restore their democracy to the people. To those of the political class who laugh at this and decry such a prospect, I merely say, “They would, wouldn’t they?”.
Lord Flight
My Lords, it seems to me that the three areas where the noble Lord, Lord Liddle, is suggesting the lock-in of the referendum should be removed are fundamental to the argument about needing to have the requirement for referenda to lock in the position as it now is. They are about our common law system, our criminal justice system and our social security provisions. These are crucial areas and, as others have pointed out, because of their importance we negotiated, and were satisfied to get, the emergency brakes at Lisbon.
Some may not agree or be comfortable with the use of required referenda to act as a lock-in to the position that we are in; that is their view. But the whole point of the Bill is to protect citizens against UK Governments, as they have done over the past 20 years, gradually ceding more and more powers without any form of consent from the electorate or from changes in Europe to which the Government are not necessarily a party having the same effect. It would be completely illogical for the Government, having decided to embark upon this Bill, suddenly to say, “We are quite happy after all not to have the lock-in on the crucial area where we have emergency brakes”. The amendment is rather, dare I say, a waste of time, because it goes to the heart of what the Bill is about.
Lord Williamson of Horton
I pose a question to the Minister and not just to join side 1 or side 2, which is a feature of Committee. We are dealing with Clause 4, which is headed, “Cases where treaty or Article 48(6) decision attracts a referendum”. The purpose of the amendment is to remove some elements from that requirement. We will soon discuss a whole series of amendments—Amendments 23B to 23M—which relate to different subjects but have the same single purpose. They identify areas where, if a proposed decision is considered beneficial to the UK, it could be decided by Parliament without a national referendum. That is what we are talking about on this amendment and will be talking about on many more amendments, which will probably take us right up to dinner time.
Of course, some of these questions could probably be decided in any case under existing powers without any treaty change—that is quite possible in many cases—or any decision under Article 48(6). However, areas such as cross-border crime, which is the subject of a couple of amendments, might require such a decision. For this reason, I pose this question. I emphasise that it is a question, not a statement of opinion. If the Government, or more importantly Parliament, consider a small change that would require the operation of, for example, Clause 4(1) or Clause 6(5), and they thought that it was advantageous to the United Kingdom to do so, can the Minister envisage any circumstance in which it could be adopted without a referendum? I exclude from the question codification, which we will come to; measures applying to other member states but not to the UK; and accession treaties covered by Clause 4(4). That last point might be disputed, as it was earlier in the Committee. However, I pose my question. It is important for the further consideration of the Bill that we should know whether future decisions that are favourable to the UK but that would require these changes can ever be decided without a referendum.
Lord Wallace of Saltaire
My Lords, we have had a series of rather general debates, some of which relate to the amendment under consideration. However, I fear that several speeches have not referred at all to the amendment that we are discussing.
I first answer the broad and appropriate question that the noble Lord, Lord Williamson, posed. The Government’s case is that, under the terms of the Lisbon treaty, we now have considerable flexibility to do a great deal more within the current competencies of the European Union, some of which will be of definite advantage to this country, without needing further treaty change. The amendment seems to be based on an assumption that there is very little flexibility in the treaties, and that Britain is being pushed to the margins, stands alone, and will somehow be trapped by this. The coalition Government are making the case that we wish to make the best of our position in the European Union, but there is now a good deal of headroom and we are not cramped by current conditions. We are, as we will come to later, taking part in at least one exercise in what might become enhanced co-operation on the EU patent. The EU and Britain can work together within existing competencies for some considerable time to come.
On the previous day in Committee, I quoted David Miliband as saying clearly that, with the acceptance of the Lisbon treaty, we should now be entering a stage of consolidation in which we do not need further treaty change for some five to 10 years. If that turns out not to be the case, we will all have to deal with the situation as it then comes.
Lord Lea of Crondall
This is the most important point in the Bill. Are the Government now saying that if the Lisbon treaty says X, Y and Z, none of these clauses can in any way undermine it?
Lord Wallace of Saltaire
I was not aware that any of these clauses in any way undermined the Lisbon treaty. The noble Lord, Lord Kerr, who was much involved in the EU convention, is not here. Those of us who have read, as I have, a certain amount on the EU convention and the Lisbon treaty, which followed it, are well aware that the clauses on the emergency brake and passerelle were agreed after hard negotiations, in which it was not the United Kingdom versus all the others. Several member Governments in this now rather large and complex European Union wanted some reassurance that, as they touched on such sensitive areas as national sovereignty, law, finance and welfare provision—some of the issues covered by these emergency brake provisions—they would have, at the back, the ability to say, “No, we are not happy with what is proceeding”. That is what the emergency brake is about. It is not the case that Britain stands alone against 26 other member states that are determined to integrate further and sweep more powers into Brussels.
The United Kingdom and several others are pushing for further co-operation in a range of areas. Coalitions across the European Union differ according to each subject on which we negotiate. The noble Lord, Lord Liddle, knows better than me what it looks like once you are inside government. The emergency brakes are there to reassure member states—their public and their Governments—and those who care not just about the peculiarities of English criminal law and justice but about those of Polish and Romanian criminal law and justice. I have read what the then Foreign Secretary, Jack Straw, said about this when he gave evidence to the House of Commons European Scrutiny Committee on the Lisbon treaty. He said that the Government hoped that the emergency brake would never have to be used, but that it was there as a reassurance to national Governments. I emphasise “Governments”; this was not just about the British.
Jack Straw went on to say to the House of Lords European Union Committee:
“So it is an additional protection and I think really rather an important one”.
Perhaps the noble Lord, Lord Liddle, drafted this. Jack Straw then said:
“Again, it is quite a paradoxical point but I think the effect of it may be to provide greater confidence to British Government to get involved in opting into instruments, which is actually in principle what we want to do, and having done that then some additional surety which will get a satisfactory answer so that we do not have to apply the emergency brake”.
The noble Lord, Lord Liddle, said that sometimes the arguments around all this are arcane and of mind-boggling complexity. That sentence was not the easiest to read. However, the whole purpose of the emergency brakes is precisely to reassure national Governments on sensitive issues. It is not intended that they should be regularly used. It is highly unlikely that any Government will wish to remove them in the foreseeable future. Therefore, I suggest humbly that this amendment is one of the least useful that we have to consider.
Lord Liddle
I think the noble Lord, Lord Wallace, is trying to distort the position that I have put forward. I am not in favour of removing the emergency brakes. I am saying that the flexibility is there in the Lisbon treaty to do this. Those of us who have doubts about the Government’s Bill are saying that since this flexibility could be exercised only by Act of Parliament, why does it have to be done through a referendum? That is fundamentally the point. We heard the argument about what the former Foreign Secretary, David Miliband, said about the Lisbon treaty late at night in the previous session of the Committee. The point is that David Miliband recommended the Lisbon treaty to the other place on the basis of the flexibilities that it contains. However, the problem with the Bill is that it tries to tie up all those flexibilities with its wretched referendum lock.
The noble Lord, Lord Wallace, is trying to cover up the fact that his party is allowing the Conservative Party a second bite at the cherry on the referendum on the Lisbon treaty that it failed to secure. That is what much of the Bill is about. It is to my great regret that the British party that has been the strongest supporter of Britain’s membership of the European Union has gone along with what the Conservatives are asking for in this case. They are after a re-run of Lisbon. The amendments that we on this side of the Committee have put forward say, “Let us take the Lisbon treaty as it is and accept that the flexibilities within it do not require referenda”.
Lord Wallace of Saltaire
It is my great regret that for 13 years under the previous Labour Government the balance of public opinion in this country became steadily more sceptical about the European Union and that the Government of Tony Blair and then of Gordon Brown failed to make a positive case for European Union engagement. That has left us with a very sceptical public and a deeply sceptical and antagonistic press. That is the problem with which this Bill deals. It is another problem that we have inherited from a succession of previous Governments. The noble Lord, Lord Liddle, might well have tried to do something about that at the time from inside government, but unfortunately he did not succeed.
Lord Liddle
We can have academic debates about these questions in other places, and I do not want to delay the Committee. However, on the facts, there has been no great swing of British public opinion against the European Union over the past 15 years or so. It has fluctuated with circumstances over time. The Eurosceptic press was not created by the previous Government; unfortunately, it has been with us for a lot longer than that.
We on this side fundamentally object to the idea that plebiscitary democracy is the way to restore public trust. I am surprised that the noble Lord, Lord Wallace, is going along with this. I do not know what the noble Lord’s views are on the current referendum campaign, but there does not seem to be a high quality of public debate on referenda, given the way in which some of the people involved in the referendum campaign have argued that we are missing out by not having these issues decided in Parliament, where there would at least be a more balanced consideration of them.
I will, of course, withdraw this amendment. However, we on this side have moved several amendments on these lines, and we see no give whatever on the Government’s part. On subsequent Committee days I will refer to the question asked by the noble Lord, Lord Williamson, to which the Government must face up: namely, if they think that something has to be done in the national interest, would it still require a referendum, and what would be their position on that? That question is highly relevant.
Lord Lamont of Lerwick
What sort of policy proposals would the noble Lord want the emergency brake lifted for? Given that the emergency brake is there purely as a defensive mechanism, to be used rarely on occasions of national interest as a negative power, what circumstances can he envisage in which he would want to get rid of it? In all the areas that he has mentioned on which there might be co-operation, we can agree to co-operate anyway.
Lord Liddle
The noble Lord is right, of course, but it seems to me that on judicial co-operation, for instance, we had established the confidence that the former Foreign Secretary Jack Straw talked about and that Europe was important and effective in these areas. We might wish at some stage—I am not saying that we would but we might—to see some change in the processes. After all, it might be not only us who want to apply the emergency brake. Other member states might wish to do so, and that might be detrimental to the possibility of getting agreement on these questions. If we look back to Maastricht, we see that justice and home affairs were included in the European treaties for the first time on the basis of unanimity. However, by the time we got round to Lisbon there was an overwhelming consensus among member states that these matters should not be in a separate pillar but should be part of the main business of the Community, and that in the vast majority of cases there should be majority voting. Opinions change in the light of circumstances. Therefore, why should we tie ourselves up in referenda?
Baroness Williams of Crosby
I hope that I may suggest a response to the noble Lord. One example that we on this Bench have discussed is the growing incidence of piracy, which might stop a great deal of traffic passing through the Red Sea and affect the interests of our country and of others. Secondly, in the immediate aftermath of the freezing of assets of a number of non-democratic leaders following the Arab spring, money laundering might be regarded as an urgent issue.
Lord Liddle
The noble Baroness comes to my aid and makes good points, for which I thank her. I shall withdraw the amendment, but the Government should think hard about flexibility in the Bill. At the moment it is profoundly damaging to the British national interest because it gives our Ministers no flexibility whatever in their dealings with the European Union.
Lord Waddington
Lord Waddington
My Lords, I will not detain the Committee for very long. At first sight one might think that this amendment was a bit of a fuss about nothing. Why should anyone fuss about the codification of the practice of an existing competence? However, when one comes to examine the matter, the implications are serious. They were spotted by the House of Commons European Scrutiny Committee, which reported in these terms. It said, referring to the exception in Clause 4(4):
“In our opinion, this exception is significant: it would cover the practice of EU institutions pushing at the boundaries of their competence (competence creep), sometimes supported by judgments of the ECJ, and subsequently codified in a revision of the Treaties”.
I give your Lordships a simple example of what I am talking about. We are talking about, for instance, converting a non-binding intergovernmental agreement, which can be revised or revoked by another simple intergovernmental communiqué, into a treaty law which can never be changed except with the unanimous agreement of all member states. We are talking about what is in effect a transfer of power or competence because we are enshrining in the treaties an obligation that was not in them before. All this is not fanciful: conversion of simple agreements into what is to all intents and purposes permanent and irreversible Community law, backed up by sanctions against backsliders, has happened and does happen. In particular, parts of the Lisbon treaty were justified as mere codification of practice.
For instance, our own European Union Select Committee, in the 10th Report of the 2007-08 Session, on its assessment of the impact of the Lisbon treaty, found that new Article 43(1) of the Treaty of European Union, inserted by Lisbon, which set out the task for which the EU could deploy military and civilian missions under the common security and defence policy, codified in the TEU the tasks that had been agreed by member state Governments in 2003, as part of the European security strategy. However, the wording of the report, which I have here, hardly demonstrates that the committee had a clear understanding of what was happening. Rather surprisingly, at paragraph 12.127, the report stated:
“The Treaty will not change the scope of the CFSP or transfer any additional powers to the EU in this area. The new provisions in the Treaty could lead to a more active role for the EU in the area of CFSP, but much will depend on the degree of consensus among Member States regarding such a role”.
In fact, a non-binding intergovernmental agreement that could have been revised at any time by a simple intergovernmental communiqué was becoming virtually irreversible treaty law. It was not a mere codification, but a clear example of well concealed competence creep.
We are not debating whether the common security and defence policy is good or bad; I am pointing out that Clause 4(4)(a) would allow the conversion of a non-binding practice into binding and irreversible community law. The Bill is saying that when that happens, there is no need for a referendum.
Finally, the amendment and the situations that I have described should make us wonder whether the provision in the Bill for referendums, far from being an attack on parliamentary democracy, may mean that Governments have to take more care to ensure that they are open with their own Parliaments as to the implications of proposals, because of their statutory obligation to hold referendums, if there is a transfer of power or competence. I shall certainly not press the amendment to a vote, but I hope that Select Committees will in future be alert to the possibility of new law being made under the guise of codification, and report accordingly.
Lord Dykes
I apologise for interrupting. Can the noble Lord give any other examples, apart from the CFSP?
Lord Waddington
That is the example that comes to mind. There are three or four of them in the Lisbon treaty, but I do not have that information and, unfortunately, I cannot give it to my noble friend, but I will write to him, if he wants it. There were two or three other occasions; I am not saying that they were earth shattering, but it is alarming that the Select Committee did not spot that new law was being made here. That is the point I am making. It is alarming that new law could be made without holding a referendum, and it is doubly alarming that one of our expert Select Committees in this House did not spot what was happening on that occasion. It should not happen in future.
Lord Hannay of Chiswick
As a member of the EU Sub-Committee that was the author of that example, I should enlighten the noble Lord on the process. First, what he has said in the past few minutes is based on an interpretation that is a complete fantasy, whereby if this Government and country are party to an intergovernmental agreement, they can walk out of it when they like. They cannot do that. It is a matter of good faith and the law on treaties, and you cannot do that.
The noble Lord is quite right to say—and the text he read out demonstrates this—that we were perfectly well aware that the CFSP and the ESDP were being shifted from an intergovernmental basis on to a treaty basis. That is what we said in our report, but the key point was that the provisions for taking decisions within the Lisbon treaty in this area require unanimity, and there would be no surrender of powers or competences whatever. I am sorry—I will speak to the amendment in a moment, but I wished to correct that point.
Lord Waddington
With the greatest respect to my noble friend, he is in error. There was an intergovernmental agreement. You can say that that gave a competence to the EU, but it could have been withdrawn in a moment by just a communiqué between the member states. The noble Lord is surely not saying that it was a matter of insignificance to transfer an intergovernmental agreement into cast-iron treaty law. He is surely not saying that the report from which I read out made clear to its readers that, in fact, new law was being made on that occasion. The report does not say anything like that. It was certainly not a clear statement that an intergovernmental agreement was being transferred and converted into community treaty law.
Lord Radice
I thank the noble Lord for giving way, but what the noble Lord, Lord Hannay, made clear was that this position, even if it is in community law, is protected by veto. I do not think that the noble Lord, Lord Waddington, understood that.
Lord Waddington
That is nothing to do with the case that I have raised. I am saying that the Bill deals with all sorts of situations where it is said that there is a transfer of competence, and that there should therefore be a referendum. I am pointing out that, in this clause, what is dressed up as a mere codification can often be a transfer of competence and the conversion of an agreement between members states that could be altered at the drop of a hat into binding treaty law. That is what I am talking about. I beg to move.
Lord Lamont of Lerwick
My noble friend Lord Waddington is to be congratulated on and thanked for raising an extremely important point on which I should like the Minister’s reassurance. I should like him to address the points made by my noble friend.
Of course I understand that the Bill deals only with future treaty change, not the existing provisions of the treaty. If a power of competence has already been conceded to the EU from the UK, the decision obviously cannot be reversed by the Bill. Under it, codification does not require a referendum in any case, including a codified transfer of power or competence. Why? I know that the Government’s argument is that if codification takes place by the granting of a formal treaty base for an action, the transfer of power has already taken place, either under the treaties or through a different general article, such as Article 352.
However, the point that the noble Lord, Lord Waddington, raised is important. I know that some members of the Committee dislike the phrase “competence creep”, but a transfer of powers could happen through codification and the interpretation of existing treaties. I return to the point to which I referred previously, when challenged by the noble Lord, Lord Tomlinson, about an example of competence creep. I cited the use made of Article 122 of the Treaty on the Functioning of the European Union to set up the European financial stability mechanism. That article, as many Members of the Committee are aware, states that financial assistance can be granted to a member state where the state is,
“in difficulties or is seriously threatened with severe difficulties caused by natural disasters or exceptional occurrences beyond its control”.
It is very difficult to argue that the case of the financial difficulties which Portugal got into were a natural disaster or entirely beyond its control. At the very least, it seems to me that there was a significant failure of regulation, and, other people would argue, of budgetary and other policies as well.
I do not want to go into that but, to many people, that seemed a bizarre interpretation of Article 122(2). It is that sort of thing that gives rise to the anxiety that the noble Lord, Lord Waddington, articulated. Of course I understand that there is a case for codification and that it will be necessary. Perhaps a significance test could be allied with that when assessing whether codification could be misused in that way. What the noble Lord, Lord Waddington, said, is not a fantasy or an imagined danger—it is very real when one looks at how legislation has happened in the past.
Lord Brittan of Spennithorne
With great respect to my noble friends Lord Waddington and Lord Lamont, I do not think that they are correct in this case. The test of what is codification and is therefore excluded from a referendum provision is an objective one. It does not depend on the procedures used to achieve the codification; it depends on whether there has been actual codification or something going beyond it. Codification, in the normal use of the word in English law, which is how the provision would be construed, means not a change in the law but the assembly in a convenient form of existing law. Of course there can be room for argument as to whether in a particular case there has been a change or merely a codification in the sense of an assembly of existing law, but the test is an objective one, not what procedure has been—
Lord Brittan of Spennithorne
Just one moment—not the way in which that has come about either in this country or elsewhere. In the last analysis, the test of whether what has happened is codification and is therefore exempt from a referendum would be applied in the normal way by the British courts applying common-law principles.
Lord Waddington
Is not my noble friend at loggerheads with the noble Lord, Lord Hannay? The noble Lord, Lord Hannay, was arguing a short time ago that there was an existing competence. It was not at that time enshrined in treaty law but, as the result of an intergovernmental agreement, there was a competence. Clause 4(4)(a) refers to the codification of a practice in relation to the present exercise of an existing competence, so I think that I am right and that my noble friend is in error.
Lord Brittan of Spennithorne
I do not think that that is the case. The question is: is it codification or not? That is the question, not how it has come about. If it is not codification but the creation of a new law, the provision exempting the requirement for a referendum does not apply. If it is codification, which will be determined by an objective test applied by British courts in accordance with normal common-law principles, it applies. That would mean that there has been no change in the law of England, however that may have come about.
Lord Waddington
Is my noble friend therefore saying that in the new article inserted in the treaty by Lisbon there was in fact no codification, although it was stated to be a codification?
Lord Brittan of Spennithorne
I am not making any statement about whether or not any particular provision was codification. I am talking about the correct interpretation of this provision in this Bill with regard to the future, which determines whether or not a referendum is called on the question. The test is an objective one: whether what occurs in future amounts to a codification, however it has been achieved, or goes beyond a codification and involves a change in the law. It is as simple as that.
Lord Blackwell
This is the one amendment this evening with which I confess that I have some sympathy. My interpretation of Clause 4(4)(a) is that it talks about the codification of practice under an existing competence. It does not talk about the codification of an existing competence but the codification of practice. As my noble friend Lord Waddington said, the EU has a history of stretching the practice of exercises of competence to take on ways of applying it that may not have originally been envisaged by those who agreed to the competence in the treaty. The example burnt in my mind is the notorious use of the health and safety provision to legislate from the EU on UK employment law a decade or so ago.
Lord Brittan of Spennithorne
I assure my noble friend that whether or not that is a good thing or a bad thing—I have a lot of sympathy with the view that excesses happened there—by no wild stretch of the imagination could that be described in English law, and we are in the process of creating a British statute, as codification. It might be wonderful; it might be disastrous; it might be neither; but it is not codification and therefore the provision would not apply.
Lord Blackwell
I said that I had some sympathy with the amendment, and I very much hope that the Minister will be able to reassure me. To my mind, that was an example of a practice coming into effect which could then be claimed was an existing practice that simply needed to be codified. I am not a lawyer, but if something can be done under an existing competence, why does it need to be codified? The EU already has the power to do what it needs. If something is then codified, the danger is that it creates a new base, or ratchets up the base, from which we can then have further ingenious development in practices. I am therefore very nervous about allowing codification of this sort to take place when, if the EU is already doing it, codification does not seem to be needed. I would very much welcome the Minister explaining and perhaps thinking again about whether that exemption is required in the Bill.
Lord Hannay of Chiswick
My Lords, I will now argue against the amendment on substance, having dealt with the ancient history to which we were all subjected previously; I do not want to go back on that.
A common-sense application to the amendment would lead one to regard it as bizarre. The object appears to be to ensure that if the European Union, with the agreement of the British Government—which is required under unanimity—conducted an act of genuine codification, we would have a jolly referendum about it. All I can say is that if noble Lords really want to go around this country stirring up apathy about the codification of some obscure piece of European law, common sense has flown out of the window.
The amendment is being moved, and support for it being given, on the basis of fear that a British Government will not know enough about the process to distinguish between a real codification and—in the parlance of noble Lords who support the amendment—competence creep. It is not sensible to add to the 56 other matters, to increase the number of referendums on a subject on which it is frankly just not credible that you could have a sensible political campaign involving the whole electorate of this country. I am not in favour of that.
Lord Waddington
I hope that the noble Lord will appreciate from the very fact that I am not pursuing the amendment that I use it as an opportunity to point out the severe error committed by members of his Select Committee when it carried out its study into the impact of Lisbon. I hope that he will always bear that in mind in future and that the error will not be repeated.
Lord Hannay of Chiswick
I am afraid that the noble Lord is going to be disappointed.
Lord Howell of Guildford
My Lords, if there are no further comments from your Lordships on this issue, it remains for me to seek to allay the fears of my noble friend Lord Waddington on a matter which is undoubtedly complex. Indeed, as the noble Lord, Lord Liddle, remarked earlier, the entire area is complex because the interface between the powers and competences of the European Union and the powers, rights and obligations of the nation state members is vastly complex and, in some senses, is in a somewhat fluid state. Indeed, it is that very fluidity that gives rise to the unease for which I believe there is substantial evidence, and I speak as someone who has been involved for just short of 50 years—even before the UK joined the then European Community—in trying to see that the European Union works in a balanced, effective and beneficial way. Over the past few years, not only in this country but in many countries we have seen an appalling record of declining confidence in, support for and public consensus over the whole construct of the European Union. In my view, the EU has conferred considerable benefits on its members and on the peace and stability of the whole world in the past, and, provided it proceeds in a sensible way with good public support, it will do so in the future in a number of, although not unlimited, areas. This is a perfectly sensible aspiration and one which I think the Bill and its aims reinforce, although I realise that that is not understood or accepted by noble Lords opposite.
The amendment would remove the provision setting out that future treaty changes which serve to codify practice under the treaties, in relation to the previous exercise of an existing competence, should not in principle require a referendum. My noble friend is concerned, as he says Members in the other place were during debates on the Bill, that codification could be used as a vehicle for transferring power or competence from the UK to the EU and that this provision might provide a loophole to allow such a transfer under a future treaty change without a referendum. If a treaty change is merely a codification of the previous practice of existing competence and nothing else in that treaty would fall within Clause 4(1) of the Bill, the Government do not think that a referendum should be required and the matter would proceed on that basis. Genuine codification—I emphasise “genuine”—is not a transfer of power or competence. The EU competence in question already exists and the EU has already acted to that effect. Even if the UK did not agree to codify existing practice by means of a treaty amendment, the EU would be able to continue to act within the relevant existing competence. Therefore, in effect there would be no point in attempting to go down another path because the EU would already be doing what it was doing within the existing competence.
An example of a treaty change which we would consider to be codification would be the introduction of a separate legal base for action previously taken to provide macro-financial assistance to some third countries. Article 352 of the TFEU, which we all know well, was used in April 2004 to provide macro-financial assistance to Albania. It was then used a further seven times to provide macro-financial assistance in a similar way to other countries. When the Lisbon treaty came along, it codified this use by providing a separate legislative base under Articles 212 and 213 of the Treaty on the Functioning of the European Union, which cover economic, financial and technical co-operation with third countries.
Lord Pearson of Rannoch
My Lords, can the Minister give us any idea of the quantum at stake in this amendment, given the European Union’s well known capacity to take power by whatever method it can? He mentioned the use of former Article 308 and the noble Lord, Lord Blackwell, mentioned how we were deceived in the Maastricht negotiations over the working time directive which, in the end, turned out to be part of the social policy. How many existing competences are being practised which might require codification? Is this a big area or is it something that will not happen very often because there is not much left to codify or to put in the treaty or to agree?
Lord Howell of Guildford
I do not think it is possible to quantify what will happen, what is happening or what has happened. Codification has occurred from time to time and I described one or two instances where it has occurred. There have been more. I would love to be able to say to the noble Lord that it has happened 15 times and it will happen 15 more times, but that would be completely unrealistic. I have no idea how it will occur, but it is important to ensure that we understand what genuine codification is. It will occur again and, as my noble friend Lord Brittan said, it is an objective legal concept but it is a bit like an Omega wrist watch that seems to be genuine but turns out to have nothing inside. There are non-genuine codifications and we have to watch very carefully to see that they do not join the genuine move towards competence creep, which is a phrase that people do not like. The phrase that people like in relation to the European Union is “knowing where they stand”, believing, as I think the majority of people in this country do, in the value of the European Union but feeling thoroughly uneasy about it continuing to take too many powers away from the nation states. Most nation states in Europe do not want that and we do not want it either.
Lord Triesman
“( ) provisions that strengthen the effectiveness of the European Union single market”
Lord Triesman
My Lords, with some regret, I think I am bound to irritate the noble Lord, Lord Howell, but I hope I do not irritate him so much that he regards what I say as being entirely in the world of fantasy. I hope he knows that I have a high enough regard for him not to use his time in that way.
In introducing the amendment I would like to reflect briefly on the debate on the previous amendment. Eminent Members of your Lordships’ House—and eminent lawyers—had a very clear difference of view about whether a codification exercise, which was intended to be non-binding in practice, had become a substantive change and a move of powers. I do not want to put words into the mouth of the noble Lord, Lord Waddington, but in essence I think that was his argument. The noble Lord, Lord Brittan, countermanded that argument by saying that it depends on the actual codification or whether what is being undertaken goes beyond the codification. I hope I have understood him correctly—that codification is not a change but an assembly of existing law in a convenient form. That argument is readily understood.
The contribution of the noble Lord, Lord Hannay, also readily understood that. I know from past experience in the area of employment law that in trying to make sense of a codification of different elements of law, it is necessary on occasion to reconstruct the language, to some extent at least, to ensure that the assembly adds to the process rather than produces confusion.
I do not think it is fanciful at all to think into the future and to consider that there may be a number of occasions—not rare occasions—when a lively discussion will take place about whether some new movement of competence is taking place or not. As they have today, noble Lords—and no doubt many in the other place and in the country as a whole—will take part in that discussion. Some will argue fiercely on one side that there is a change that requires a referendum, subject to having gone through a parliamentary process and subject to the possibility of judicial review—I understand all those points perfectly well—and others will argue that it is no such beast, that it does not require any of those kinds of steps because it is merely a tidying up in the sense of assembling the changes into a convenient form under the existing law.
I do not intend to be disagreeable about the points that the noble Lord, Lord Howell, has made, but I put to him this thought: that were the world a very tidy place, and were everyone to come along with changes that they wanted to see to arrangements in European law with a declaration that they were indeed changes to European law, and there were a movement of competence from one place to another, I have no doubt that we would see each of those events as a major event and everyone would understand the process in exactly the way that he describes it. But I do not think the world is like that. I think it is a much more muddled place in which people move and nudge existing arrangements to try to gain some advantage out of them or to tidy them up, in the course of which someone will say that an advantage is being gained and the argument will rapidly emerge that this is precisely what this piece of legislation was designed to prevent. That is what was called creep earlier in the debate. That is why I do not think it is reasonable, with the greatest respect, to say that it should be blatantly obvious to the Opposition or to anyone in your Lordships' House that one set of circumstances applies and that everyone can see that it would plainly happen very rarely and would require a special arrangement, rather than that there are things happening which many people will think pretty much continuously require some sort of special arrangement, because that is the nature of political life. With the amendments in this group, we are making a legitimate attempt to say that it would be helpful if Ministers had scope to move: a capability to do the necessary political work under certain circumstances and within the constructs of United Kingdom law, and to respond to the circumstances that they face.
Baroness Falkner of Margravine
Perhaps I may interpose a thought on this important point. My noble friend Lord Lamont several times mentioned the European financial stability mechanism. Does the noble Lord accept that, when it comes to financial crises arising and bailouts being instituted, the mechanism will take some years to come into effect? While I agree that technology can drive an impetus for change, in general I do not see any decision-making processes in the EU being affected by this. The bailouts were urgent for the countries involved, yet they will take about two years to implement.
Lord Triesman
My Lords, I appreciate the question. With respect, I think that the noble Baroness is conflating the first amendment in this group, which concerns the efficiency of the operation of the single market, with the second, which I will come to in a moment and which concerns the strengthening of financial regulation. The issues that have just been raised may be more relevant to that.
I hope I have made the point about the steps that might be needed in order to ensure that proper competitive arrangements are in place in a business environment that changes rapidly and in which the potential for monopolistic behaviour is considerable.
I turn to Amendment 23F, which concerns the strengthening of financial regulation. I accept the point made about the time that would be taken. However, we also know about the speed at which the degradation of financial institutions took place, not just in Europe but in the United States and elsewhere; and that the aim of most of the major policy-makers in a period that was both extremely troubled and extremely complex was to intervene where they felt that they could as rapidly as possible and not necessarily against an 18-month to two-year timeframe. There was a very early consideration of whether the role of the central bank in Europe should be considered. Many nations in Europe urged each other—but not very effectively—to look at the balance sheets of the banks across Europe; at the consequences for one another of the weaknesses in their balance sheets; at the issues that have since arisen from the ridiculous ways in which a great deal of interbank lending took place; at the collapse of liquidity when it could no longer take place; and at the fact that many of the institutions were deeply indebted to each other for toxic derivative products that they traded largely among themselves, and which had in many instances destroyed their balance sheets.
I would like to think that almost everybody in this House, had they been in a position to take a view, would have said that that way lay lunacy and ruin. Almost all of us would not have gone there. Therefore, while it is true that some arrangements would take a good deal of time and some states would pore over them exactly as the noble Lord, Lord Howell, said, some emergency arrangements could have assisted in circumstances of severe financial meltdown, had they been in place.
In those circumstances somebody may very legitimately say, “This is not only a European problem—it is a worldwide problem. You would have had to engage many others as well”. Of course I accept and understand that international canvas. However, it would most certainly have helped had Europe and the European nations with considerable financial power been able to go to the original G20 conferences and make points in a very much better, co-ordinated way. You do not need treaty change to make a point in a co-ordinated way—of course you do not—but it is certainly true that had they gone and urged that they wished to use powers which were perhaps a little beyond the set of powers they had, that might have had a significant effect in the G20. From those who were at the G20, I believe that that is empirically true as well.
Finally, to sweep up this group of amendments, I turn to Amendment 23H, which addresses,
“provisions that advance the prospects of international agreement to a new global trade round”.
I promise that I will say only a little about this. However, I think that everyone has seen the enormous difficulties in achieving any successful outcomes from the Doha round and the huge difficulties in co-ordinating a European position let alone a world position. Yet everybody has believed that the success of the Doha round would be one of the fundamental drivers of a huge amount of international growth and, just as important, the elimination of a great deal of poverty around the world.
There is another case, where you can imagine small arrangements at the edge—which some will say are a codification of existing arrangements and you can bet that some will say are not—which might have made a real difference and enabled us to move faster, or may in the future enable us to move faster.
Lord Lamont of Lerwick
I agree with every word that the noble Lord has said about trade and the importance of getting a world trade agreement, although those have proved extremely elusive. However, given that trade is an exclusive—exclusive—EU competence, what is the effect of his amendment?
Lord Triesman
My Lords, the intention of the amendment is to provide the scope for further adjustments to the trade arrangements and the powers of the Commissioner dealing with trade arrangements, given that Commissioners who have dealt with trade arrangements have expressed their anxiety about the limitations that have been placed on them during the negotiations in these trade rounds. It is entirely possible—it may be part of the noble Lord’s point—that these powers exist in any case and can be handled in any case. However, the experience of the difficulty in making progress leads me to believe that there may on occasions be adjustments that would make the process easier, more helpful and capable of moving faster.
My point is not that these are all world-shattering changes—they may be small changes. The scope to make those changes, to respond to circumstances, seems to me to be a power that would strengthen the people of the United Kingdom and strengthen the EU rather than weaken the people of the United Kingdom.
Lord Blackwell
I confess that I am having some difficulty following the noble Lord’s argument on this point and I wonder whether he can help me. As my noble friend Lord Lamont has said, the EU already has exclusive competence in the area of international agreements. It has competence over the single market. It has competence over regulation. It can legislate in these areas using the normal provisions of the EU—that is what the competence gives it; that is under the existing treaty—so we are not talking about stopping it legislating. I am trying to understand what it is the noble Lord thinks might require treaty change to enable the EU to do something; and why, if it requires treaty change, that will not in any case take several years to accomplish, in the way that treaty changes normally do. I fail to understand what is the restriction to act in areas where the EU already has competence.
Lord Triesman
My Lords, I apologise if what I have said is not clear enough. My point at the very beginning of my comments was that when you begin to talk about the latitude to move in any of these areas, you can guarantee that one set of people will say that it is a new arrangement and demand the conditions which the Bill establishes for a referendum, while others will say that it is simply in the areas of competence: they can do it with a degree of codification, were that to be necessary, or they can do it under the rubric of the codified arrangements. It will always be the subject of conflict between those who believe that it is a subterfuge to extend the powers of the EU and those who believe that it can be done legitimately. I am saying that you cannot run a proper political process that way, with that much obscurity and that many arguments and with the prospect of many things not only going through our Parliament but through judicial review, and with fierce arguments around the country about the need for a referendum in those circumstances. It just strikes me as being a way of tying the hands of those who you hope and expect will be competent to conduct the discussions in the European environment to a successful conclusion in the interests of this country.
Lord Pearson of Rannoch
My Lords, I speak against these amendments. Amendment 23B assumes that the EU single market is a good thing for this country. That is a common misconception among the political class upon which I should like to cast a little doubt. This is a big and detailed subject and I recommend that any serious student should consult the briefing notes on the globalbritain.org website, which demolish the whole myth of the EU's economic usefulness and that of its single market.
The background point, which is not generally understood, is that the single market is more than a free trade area, it is a customs union. This means that a single customs barrier surrounds all the countries in the Union, whose international tariffs and trading arrangements are negotiated and decided centrally by the European Commission. In a free trade area, on the other hand, the countries concerned enjoy free trade among each other, but they remain able to make their own tariff arrangements with countries outside that area. They have their own seats on the World Trade Organisation and they are also able to make their own domestic law in areas such as working time, health and safety at work, part-time workers and so on.
So a country does not need to belong to the EU to enjoy free trade with it. According to a recent government Answer to me, the EU and its single market already have free trade agreements with some 63 countries outside the EU and are on their way to having similar agreements with another 75 countries, or roughly 80 per cent of the other countries in the world. It is perhaps worth noting that both Switzerland and Norway, not in the EU or its single market, both export more per capita to the single market than we do; Switzerland three times as much and Norway five times.
Lord Hannay of Chiswick
I am grateful to the noble Lord for giving way, but I fear that he is in danger of misleading the House fairly elaborately in this matter. He is talking about three things, not two: the first is a free trade area, the second is a customs union and the third is the single market. Norway, he has just stated categorically, is not part of the single market. I am afraid that he is in error. It is part of the single market, and it applies single market legislation by receiving fax messages from Brussels telling it what it has to do. The members of the European economic area are in the single market but are not in a customs union. However, I am not totally sure that this line of argument is going to get us very far—but it would be useful.
Lord Pearson of Rannoch
I do not want to delay the House, but that is why I made the distinction between a customs union and a free trade area.
The worst aspect of our membership of the EU single market is its sheer cost. Like their predecessors, this Government are determined to avoid an official cost-benefit analysis, and so we are left with the eight analyses that have been produced since the turn of the century, four of which are pretty much official, and which put the cost of our single market membership at anything between 4 per cent and 10 per cent of GDP. Indeed, the highest cost estimate came in 2005 from the Treasury itself in a paper entitled Global Europe: Full-Employment Europe under the signature of Mr Gordon Brown when he was Chancellor of the Exchequer. It put the cost of EU regulation at 6 per cent of GDP and of EU protectionism at 7 per cent. In March 2006, the French Conseil d'Analyse Economique, which is attached to their Prime Minister’s office, found that France had gained nothing from the single market or, indeed, the euro. In June 2006, the Swiss Government published their finding that joining the EU and its single market would be nine times more expensive than staying with their current sectoral free trade agreements with Brussels. Later in 2006, the EU Commissioner for Enterprise and Industry, Mr Günter Verheugen, said that EU regulation was costing its members some €600 billion a year, or around 6 per cent of GDP at the time.
One of the troubles with being in the single market is that this EU overregulation, whatever it costs, applies to the whole of our economy, not just to the 9 per cent that trades with clients in the rest of the EU. So the 11 per cent of our GDP that goes in trade with the rest of the world and the 80 per cent that stays in our domestic economy—91 per cent of our GDP—has to carry the burdens of Brussels’s overregulation. There are, of course, those who fear that were we to leave the EU and its single market our trade would somehow suffer and that, to quote the propaganda, 3 million jobs would be lost. The truth appears to be the opposite: trade would expand and jobs would be created. It is, of course, true that we have 3 million jobs exporting goods and services to clients in the EU, but they have 4.5 million jobs exporting goods and services to us. We are, in fact, the EU’s largest client. Would the French stop selling us their wine or the Germans their cars just because we had left the single market and were no longer bossed around by Brussels? Of course not. There are also the points that the World Trade Organisation would prevent any form of retaliation were we to leave and that the EU’s average external tariff is now below 1 per cent. Our trade is going up faster with the rest of the world than with the EU, both inwards and outwards. Our exports to the EU single market are declining. The single market is sclerotic and overregulated and its demographic trend is against it. It is the “Titanic”.
It is also hard to think of any other customs unions along the lines of the EU. There was the Soviet Union, and there may be something similar in the Caribbean, but nowhere else. Mercosur in South America does not count because its members are free to agree their trading relationships with non-members. Can the Government advise us of any other customs unions like the EU? If not, does that not suggest that it may not be such a great idea?
As to Amendment 23F, I do not think we need the EU getting more involved in financial regulation. Commissioner Barnier has openly said that he does not favour what he calls the Anglo-Saxon model, and we have yet to feel the damage done to the City of London and its ability to pay tax by the new EU supervisory bodies. When the movers of the amendment say that they do not want it to interfere with the UK’s general approach to financial regulation, I ask whether they have Monsieur Barnier’s agreement? The deed is done. Overall financial supervision has passed to Brussels. No provisions in this Bill will prevent that.
As to Amendment 23H, I fear that those of us who come from the Eurorealistic perspective would rather that the unelected Commission did not continue to negotiate on our behalf in a new global trade round. As the world’s fifth-largest economy, we would rather do it for ourselves.
Finally, is it not really grotesque that an organisation that has so dismally failed to look after the vast sums entrusted to it by the taxpayers of Europe should have its powers strengthened, or made more effective, as the amendments have it? More will certainly mean even worse, and I oppose the amendments.
Lord Empey
My Lords, I think we are straying back to a Second Reading debate, because we seem to have moved somewhat from the amendments. I shall return to what the noble Lord, Lord Triesman, said about emergencies and new technical developments that could arise and that are reasons that he is using to justify his amendment.
Of course emergencies will always arise—they are part of life’s rich panoply—and there will always be new developments, but even if they did require changes to treaties and so on, we know that that will take a considerable time. Emergencies can be dealt with by multilateral agreements, bilateral agreements or in a range of other ways, and we deal with them that way all the time. I have worked with an international treaty: the Belfast agreement. We had specific arrangements with the Irish Republic. They were codified. I suspect that people on the streets of Britain talk of little else but codification from what I have been listening to this afternoon.
The debate is so complicated that it causes the eyes to glaze over. We had specific areas of co-operation set out in an international treaty and discovered that an emergency arose. It was the prospect that we would not have enough gas on both sides of the Irish border. What did we do? Because we did not have it codified and it was not part of a treaty, the two Ministers—I was one of them—reached a bilateral agreement that we had ratified through our existing processes. We were able to do the job and get the pipeline built in a fraction of the time that it would have taken had we taken it through a formal process. I believe Governments will always be able to find a way to work together in an emergency and that when things are part of an elaborate process, that does not guarantee speed.
The amendments talk about the effectiveness of the single market, effectiveness in mitigating climate change and effective financial regulations. Effectiveness, like beauty, is in the eye of the beholder. If you talk about all these issues, you are talking about pretty well everything in modern life and policy. Not an awful lot is left if you include all these issues.
A fundamental underlying mistake is being made here; nations that require referendums as part of their existing constitutions are not rendered useless negotiators in Brussels. A number of our fellow members of the European Union have referendums as an integral part of their constitutions. Do we mean that the Danes or the Irish are unable to negotiate? Of course not. They are able to do it, and they sit down with fellow Ministers who might not have that requirement. Does that mean that the Danes, the Irish and others are hogtied and unable to negotiate? Over the years, they have sometimes done a jolly good deal. The recent referendum in the Irish Republic on the Lisbon treaty was initially rejected. They went back to the table and got a better deal, and then it was passed. I do not believe that that indicates in any sense that, just because a referendum might be required, a Minister, or a Government, is paralysed. In fact, the evidence is to the contrary. Of course, if it gets far too detailed and concerns trivial matters, I would agree, but I do not think that we are facing that.
In any event, this Bill is about the future. It is not about the past. I believe that there is sufficient wriggle room in the existing treaties and that you would be a pretty bad Government or a pretty weak Minister if you could not find something on which to hang a hook to move a particular measure forward. I am not confident that this Bill will be a showstopper for the European Union. Of course it will not. The European Union will continue. We have many treaty obligations in it, which I believe will be honoured, but this Bill is about preventing expansion and trying to restore public confidence. It is precisely because people do not believe politicians any more that this sort of Bill is necessary.
Baroness Williams of Crosby
My Lords, my noble friend Lord Taverne and I have a difficulty. A number of speeches addressing this group of amendments have moved somewhat between the groups. There have been references to later amendments. We are not quite sure whether this debate is meant to comprise the list of things being put forward by the Front Bench of the Labour Party, including this amendment as well as the others that fall within the same general area, or whether we are supposed to limit ourselves entirely to the single market. In that case, a great many speeches have been rather close to being out of order. Perhaps the Government will indicate whether they wish this debate to be limited to the single market or to take a number of these amendments together, in which case my noble friend Lord Taverne and I both wish to say something.
Lord Wallace of Saltaire
As the noble Lord, Lord Triesman, recognised, and perhaps I may suggest, as this group and the groups that follow cover similar themes one might talk about this group and those that follow, which will save time later when we get to the others.
Baroness Williams of Crosby
I am grateful for that, which is exactly my view. Perhaps I might refer to what the noble Lord, Lord Triesman, said. I also associate those concepts with some of the later amendments. I will not keep the House for long. The noble Lord’s good argument was made strongly on the basis of the need in some cases for urgent decisions to be made. He pointed out that the formal procedures are long-winded and slow and that therefore in some cases it would be irrelevant to the issue that had come up because it would take so long to deal with the procedures.
I now refer to a second group of amendments, which is what I might call the Canute group. What is the Canute group? Those of us who remember the early history of Britain will remember that the king at the time ordered the tide to turn back. In other words, he insisted on not seeing the world as it is. The amendments in this group are about insisting—
Baroness Williams of Crosby
Perhaps I may finish my sentence before I give way. The amendments in this group insist, to some extent, that the urgent and very troubling issues that confront us now can somehow be put off and not dealt with at the present time.
Lord Willoughby de Broke
All I want to say is that King Canute did not order the sea to go back. He was demonstrating to his courtiers that he did not have the power to turn the sea back, so the analogy that the noble Baroness was making is incorrect.
Baroness Williams of Crosby
I defer to the noble Lord’s deep knowledge of history, but he will accept that metaphors and similes are sometimes rather broader than a deep knowledge of history would insist on them being. I insist on keeping my metaphor going for a few more minutes. The point that I want to make strongly is that issues are coming up that clearly will require a degree of competence on the part of the European Union that is not embraced in the present treaties. Unless we exclude some of these issues from the elaborate procedure of the referendum lock, we will find ourselves hobbled in trying to deal with them.
I shall give two illustrations. I particularly urge my noble friends in the Conservative Party to consider one of them very carefully. In the past couple of months we have seen some of the consequences of the Arab spring. One of those consequences has been the placing of substantial sums of money within the structures of the European Union because there is very little control over how the European Union at present deals with inflows of money from other quarters. Members of the European Parliament have shown a great deal of sense about this and have urged the European Union to take additional action, which, as I understand the Bill, will probably require the referendum lock procedure to be met.
One of the most vociferous and articulate Members of the European Parliament on this issue of how one deals with what one might believe to be illegitimate funds—funds that have been stolen from a nation by its leader or funds that have been deliberately laundered through Europe—was the spokesman of legal affairs in the European Parliament. Mr Karim is a Conservative Member of the European Parliament, and I will quote what he said because it is extremely relevant to this debate. He said:
“I would … invite Baroness Ashton, as a key architect of the EU’s new plan for north Africa, to implement strong anti-money laundering provisions as an important part of the future EU strategy in the region. More broadly, the … Commission must act to urgently address the deficiencies in the current arrangements regarding funds originating overseas. The EU cannot continue to be a savings account in which leaders of developing countries deposit their ill-gotten funds”.
Mr Karim went on to call for urgent action by the European Union, which under this Bill will of course be caught by the referendum lock.
I think that my second example will stir a number of Members of this Committee as it certainly stirs me: namely, the relative unwillingness of the United Kingdom to address the issue of human trafficking. According to the International Labour Organisation, human trafficking has now become the third largest common illicit business in the world. It is valued by the ILO at approximately €32 billion in the past year. It is third after the drug trade and the arms trade. It has burgeoned and mushroomed in the past few years.
The United Kingdom was unwilling to sign and agree to an EU directive on the trafficking of children. It refused to do so on the grounds that the United Kingdom had its own measures and did not require a European Union directive on the issue. As many will know, the argument went on month after month, with only Denmark and the United Kingdom refusing to agree to the proposed directive. In this country, the official figures are said by the Home Office, the Metropolitan Police and the UK Border Agency to be far higher than the official figures that are given. Recently, the Home Office said that the official figure for child and human trafficking was around 250 cases a year. One area of the borough of Westminster alone has found something like 1,120 children who are being trafficked. It has announced that it is having to strengthen its own steps strongly to try to deal with the issues.
I will not bore the House with telling it—
Baroness Williams of Crosby
I will not give way at the moment. I am in the middle of an argument. I will gladly give way to the noble Lord afterwards. I will not bore the House by going on about some of the unspeakably awful cases. For example, a boy from the middle of Africa was brought to this country at the age of 16 by a man who pretended to befriend him. Day after day, he was locked up in a house with just one meal a day being served to him and was repeatedly sexually abused by older men. A young mother of several children was trafficked to this country and used by up to 15 men a day against her own will. That was the price of the people who trafficked her in order not to reveal that she was an illegal immigrant.
I will not go on about this, but the cases are bloodcurdling, frightening, terrible. People are trafficked for three purposes: first, sexual exploitation; secondly, direct slavery, often in domestic work; and, thirdly—this is not unfamiliar to those of us who, like me, live in East Anglia—fruit and vegetable picking; young men and women, often children, are used in fruit and vegetable fields, often with almost no wages at all, in conditions of near slavery. We do not like to observe these issues. We like to think that that does not happen here and we reject the concept that such things can happen in an orderly and well policed state, but we are wrong. Unless we can get some international agreement, or at least a European-wide agreement, we will not be able to stop the sources that are being dealt with in other European countries in such a way as to bring this kind of thing to an end. It took 10 months for the British Government and the Prime Minister, under pressure from a group of women who organised visits and petitions to No. 10 Downing Street, finally to agree to this directive a couple of weeks ago. The Prime Minister did not want to do it because he did not want to agree that this extension of the competence of the European Union was essential to deal with this disgusting trend.
I have mentioned these things, and I shall now stop arguing them, to point out that there are what I call—I am sorry, but I shall repeat it—Canute cases, where we try to pretend that the massive structure of organised crime, ranging from the drug trade to human trafficking to money laundering, is not there. When you weigh these issues in the balance, it is right for the noble Lord, Lord Triesman, and his colleagues on the Labour Front Bench to press for certain issues not to be subject to the referendum or to the inevitable delays that follow it. These issues affect our fellow human beings, many of them British, in ways that we should never accept as a country. They require at least a reasoned reaction; they can no longer be dealt with on a purely national basis.
Lord Pearson of Rannoch
Without wishing to detract in any way from the terrible situation to which the noble Baroness has so brilliantly spoken, does she have any statistics on how many of these people come here from Europe through the European open border? Would it not be easier for this country—which is, after all, an island—to police its borders more effectively if we had control of those borders? I suspect that the majority of these people come through from other countries in the European Union.
Baroness Williams of Crosby
In the case of prostitution, quite a lot of the entries are from eastern Europe. Indeed, some of the more disagreeable people have exploited the fact that the eastern Europeans are not aware of where they are going. They are offered jobs in the catering trade—hotels and so on—and then find out that they have been sold into prostitution. They are not aware of how to deal with the situation or of the safeguards that should be open to them. However, that is not the case with the other two examples I gave of domestic slavery and agricultural exploitation. In those cases, most of them come into this country, rather amazingly, straight from third countries and not by way of other member states of the European Union.
Lord Stoddart of Swindon
On the first intervention, I got the impression that the noble Baroness thought that all five groups of amendments were being taken together. Is that correct? If we are taking all five groups together we will be here for a very long time and noble Lords will miss their dinner. Could we have clarification on this?
Lord Wallace of Saltaire
I understood the noble Lord, Lord Triesman, to say that as this group and the following group of amendments cover a number of similar issues he had touched on some of the broader issues behind them. It was not my intention to go into the detail on all of them as the noble Baroness has just done.
Lord Taverne
My Lords, some very important issues are raised by these amendments. If they are now to be considered and debated, I do not see how we can possibly break for dinner.
Lord Triesman
My Lords, we have been urged by the usual channels to make sure that the business is handled as effectively as possible. For those reasons I spoke to group three, which has broadly related economics based arguments. I spoke to nothing else. I was kindly reminded that I would need to move the amendment at the end and, in due course, formally move the next two amendments. However, I spoke to the economic group, group three. I hope I have now made it clear.
Lord Wallace of Saltaire
My Lords, in that case, perhaps I may give the Government’s response on this group. We will then be able to break for dinner and return to the others later. All afternoon this has been a rather untidy debate. I almost congratulate the noble Lord, Lord Pearson of Rannoch, on actually mentioning in his speech the amendment under discussion. In the previous debate he did not mention the amendment we were supposed to be discussing. We are in a Committee stage debate at the moment in which one is supposed to address one’s remarks to the Bill under discussion rather than to the state of the world, the wickedness of the EU as such and all the other things he touched on in his interventions.
The noble Lord, Lord Triesman, raised large questions about global markets and global governance. As we address these amendments, we all recognise that what the EU does in competition policy, in negotiating on world trade and so on is part of a rather complex system of different intergovernmental organisations, of which the EU is one. I remind the noble Baroness, Lady Williams, that money laundering is largely dealt with, for example, under the financial action task force, which is more closely associated with the OECD than with the EU. It does it rather well. Indeed, I have read a volume by one of the noble Baroness’s close relatives which refers to how well the financial action task force does in this respect. The EU is not responsible for all of the issues involved in managing a global market. However, it has a number of extensive powers, some of which have been discussed on this occasion.
This group of amendments and the ones that follow seem, in general, to contain a number of assumptions about the Bill, the EU and what the Government think about the EU which, I repeat, are erroneous. First, the EU has competencies in all of these areas. We are not talking about extending competencies. Opting in to the human trafficking directive does not extend competences; it merely uses the available competencies in a more effective way. The treaty of Lisbon provides ample scope for EU action in the areas cited in the amendments tabled under this group and the group that follows. The assumption that the United Kingdom is tying itself up in knots and is thus unable to act and that we are the only Government who wish to go through constitutional procedures of the kinds listed in the Bill is also erroneous. As we have said, the UK Government are in the forefront of pushing for new policies in a number of areas. As the noble Baroness said, we have just signed up to the human trafficking directive.
On the Doha round, it is not the EU that is causing the problem, as the noble Lord, Lord Triesman, knows. Incidentally, when Britain first joined the European Community as it then was, one of the first things that I and many others learnt about it was Article 113 and the 113 committee, and the exclusive competence of the European Community in external trade. I am not sure what one can provide more than exclusive competence —perhaps super-exclusive competence is needed next.
We are now negotiating on services as well. The assumption that the EU is unable to act in all of this is part of the misunderstandings that others are raising. There is also the question that if the European Union suddenly found that it lacked these powers then it could rush through a treaty change in two months. Actually, we have discovered that urgent treaty changes take somewhere between 18 and 24 months. That is part of the process we have gone through. The noble Lord, Lord Empey, rightly pointed out that in a crisis you are better off negotiating rapidly in an ad hoc framework, as we often find ourselves having to on a global level—G20 has emerged as part of this—rather than attempting to go through all of these very complicated programmes.
On competition policy, the European Union has now emerged as one of the two most important forums for competition policy in managing global multinationals. Until the EU developed its competition competence, the United States effectively managed the competition policy of multinational companies and operated through extra-territorial jurisdiction in imposing its judgments on multinationals operating elsewhere. The record of the EU in competition policy has on the whole been very good. The noble Lord, Lord Triesman, is quite right to point out that innovation constantly raises new problems. That is true for all jurisdictions and there is a constant race between one international organisation and another. So far, the EU has managed as well as the federal United States in that respect.
On the lack of competences, I have looked at what used to be Article 113 and is now Articles 206 and 207. There are two areas of reserved competence in Article 207. One is on audio-visual and cultural relations—not inserted by the British but by the French—and the other is on limitations on negotiations in health, welfare and social services—not inserted by the British but by the Germans. We are not always the ones who are hesitant about giving way on sovereignty; it is often others. On the single market and global trade agreements, the EU is well supplied with competence.
On financial regulation, the EU is one among many actors. The Bank for International Settlements, the financial action task force and the range of other bodies to which the United Kingdom belongs and in which the UK is a full participant also play a role in this area. Our EU partners play a large role as well. The Government want to see—we will stress this on all these amendments—the European Union using the tools it has under existing treaties and its now very extensive competence more effectively, bringing about the benefits that we want to see the EU delivering for the British people and everyone across the European Union. The noble Lord, Lord Mandelson, made an excellent speech on our previous Committee day precisely expressing those sentiments. Those are sentiments that the Government share. Having said all that, I hope that the noble Lord, Lord Triesman, will be willing to withdraw his amendment. Then we will return to the next group on similar arguments after dinner.
Lord Davies of Stamford
I did not want to interrupt the noble Lord’s flow while he was speaking, but I have a rather important question. He referred to Article 207 and the derogation in that from the usual procedures on the common foreign policy that the council needs to act unanimously in these two matters involving, first, trade in cultural and audio-visual services, which he said was a provision put in at the demand of the French, and secondly, the field of social, education and health services, which he said was put in at the demand of the Germans. The noble Lord was really saying that here was a case when the treaty needed to be amended to accommodate the particular requirements of those two countries. They were not our requirements and we would rather have had no derogation in the common foreign trade policy. Let us suppose that the French and German were prepared to remove those two derogations or obstacles to freer international trade. Is it the case that under the Bill we would then require a referendum to allow the Germans and the French to agree to give up concessions which they had previously obtained?
Lord Wallace of Saltaire
I have spent a good deal of my adult life studying and teaching on the European Union. I struggle to imagine a situation in which the French Government would suddenly decide, on their own and as a single action without asking for any concessions in any other area, to give up that. Hypothetically, in a parallel universe inhabited by the noble Lord, Lord Pearson of Rannoch, and a number of other people, it is always possible that these things might happen. In the practical life of the way that the European Union works, that seems completely inconceivable.
Lord Davies of Stamford
I am grateful for that response which seems to reveal that there is potential for a complete absurdity, which must also exist elsewhere in the treaty. We would force a referendum on ourselves simply because some other member state was prepared to adopt more communautaire policies in the future and to withdraw concessions that previously they had insisted upon.
Lord Triesman
I thank all noble Lords for the contributions to the debate, in particular the noble Baroness, Lady Williams. I know we will get to people-trafficking in a later group. It is a critical issue. The examples around money laundering and the massive theft from states of their assets by their erstwhile and in some cases current leaders are also huge issues.
Of course I understand that the EU is not the only player in the global marketplace. It is not responsible for managing the whole of the global market place. I am sure there is a balance of weaknesses and strengths, but one of its strengths has been that when it has been able to act together and in a competent way its impact on other international bodies has been enormous. That is the solid evidence that has come from commissioner after commissioner, particular in the areas of competition and trade. It has been the commissioners in the areas of competition and trade who have pointed most frequently to the empirical evidence for the weaknesses when it is impossible to move effectively because of restrictions on activity. That seems to be quite central to this general proposition.
I understand where the competencies lie. I can read the texts in exactly the same way as any other Member of your Lordships’ House but I am mightily impressed by the debate that we had just before this one started and other debates of a similar kind that I have heard over the years. I know that people do not go to the pub to talk about codification—quite rightly and nor should they. Yet one party says that something that is a tidying-up exercise of one kind or another is a fundamental change and it produces what it regards as overwhelming evidence of that. Other people say—I have probably done it myself—that that is nonsense, that it is simply a tidying up and how could anyone else read that much into it?
We have heard today and on so many occasions that, because this is the EU, this will be the subject of major contention. It will be the subject of real arguments and people urging the use of powers. In those circumstances, as we try to proceed within the realm of what many of us believe are the competencies, we will find that someone will argue or powerful bodies will argue that it is a fundamental change—more fundamental, at least, than I or indeed the government Front Bench have argued that it should be—and the lock will become a threat to doing it at all. That is how it will be played out. It will be the tactical opportunity that anyone would take in the circumstances. It would be naive to believe that that is not true when it is exactly what will happen.
I seek leave to withdraw this amendment but I do so by predicting that if this Bill proceeds as it is written, the scope for Ministers to behave effectively will be reduced and in some cases—in the current climate, money laundering is a very good example—they will be left way behind the game. That will lead to a very negative judgment about our sometimes rather meagre capacity for foresight.