Lord Liddle
To ask Her Majesty’s Government whether the intergovernmental treaty presently under negotiation in Brussels will eventually become part of the structure of the European Union treaties.
The Minister of State, Foreign and Commonwealth Office (Lord Howell of Guildford)
My Lords, I think we can all cool down now. It is the prerogative of any member state to suggest additions to the European Union treaties. Any addition, including the proposed intergovernmental treaty, would need to have the agreement of all 27 member states.
Lord Liddle
I thank the Minister for doing his best in that reply. However, with all his experience of European matters stretching over five decades in politics, would he please explain to the House how the Prime Minister can one month take Britain out of the room, claiming that the proposed treaty is a threat to our vital national interests, and then the next month appear to want to wave it through, declaring that he does not mind at all if the intergovernmental treaty, of which we will not be part, makes full use of the EU institutional machinery? Is it not true, and does the Minister not agree, that really the only way to protect Britain’s vital national interests is always to be properly at the table in the room and not walk away, and that the only reason that the Prime Minister cannot do what is right for Britain is that his main concern is what he can get away with inside a divided coalition and a divided party?
Lord Howell of Guildford
I think that the noble Lord, in his enthusiasm for these matters, is getting a bit confused. This is an intergovernmental treaty; it is not going forward inside the European Union. The British Government are anxious that there should be orderly development of the eurozone and that obviously it should not collapse into chaos. Nevertheless, as I think the noble Lord himself has written, it has “design flaws” in it—I think those were his words—and therefore there has to be caution and care about the whole way in which it is carried forward. Certainly, the UK does not want to be involved in a treaty that supports a flawed system. We want to be supportive of a design for the future which is sustainable and which brings prosperity, not division, to Europe. That is the position. What is the role of the European Union institutions? We do not want to throw sand in the machine. If some of them can usefully be used in the aim of building a better euro system, we will support them, but we are reserving our position on exactly which institutions should be used and how they should be used. Our general attitude is supportive and constructive, and we are involved, as ever, in the machinery of building a prosperous and competitive Europe and a good single market. These remain our aims and we are taking a leading position on them.
Lord Taverne
My Lords, is the report in the Financial Times correct that the Government are giving a measure of support—it seems somewhat conditional—to the idea that those who signed the intergovernmental treaty can use the institutions of the community, including the Court of Justice? Does this have the support of the whole Cabinet, including the Secretary of State for Work and Pensions? Secondly, in his evidence before the House of Commons Select Committee on 11 January, the Chancellor said that the Government, in December, would have preferred to sign the proposed treaty had it included safeguards to protect the proper regulation of the City. Since the new treaty now includes safeguards that prevent it applying to the single market, what prevents the Government taking further steps towards re-engagement in Europe and signing the treaty?
Lord Howell of Guildford
There are two points there. As I said earlier, we have reserved our position as to which institutions of the EU as a whole should be usefully deployed in supporting the policing of this intergovernmental treaty. We have reserved our position on that. The report in the Times sounded a bit further forward than that and is not correct.
As to the Chancellor’s views, he has made it clear all along that a treaty that was going to reinforce a eurozone that was sustainable and which met a whole range of conditions, including full implementation of the October agreements, solving the Greek debt problem, recapitalisation of the banks and a proper liquidity structure throughout Europe, was the kind of thing that we would have supported, but that is not on the table at the moment. We will have to see how the intergovernmental treaty works, which of the existing 26 agree to it—not all of them may—and, as it proceeds, we will be supportive. But we do not want to sign up to the eurozone as it is because, as the noble Lord opposite said, and as all observers now recognise, despite their views to the contrary many years ago, the system is design-flawed.
Lord Hannay of Chiswick
My Lords, will the Minister say what provisions, if any, of the intergovernmental agreement on the table in Brussels today are objectionable to the British Government? Will he confirm that even were we to sign that agreement and it became an amendment to the Lisbon treaty, none of its provisions would impose obligations of a legally binding kind on the United Kingdom unless and until we join the eurozone?
Lord Howell of Guildford
The noble Lord’s last words are the key to the matter. The treaty on the table is designed for the 17, although others may go along with it. It will be debated in the various Parliaments. It is designed for the 17 and involves degrees of surveillance and control that are not congenial from the British point of view; we believe that we can best proceed not by being within and making constant objections and delaying the whole process of the 17 that want to go ahead, but by being supportive from outside. That is the position, which seems perfectly sensible and constructive.
Lord Pearson of Rannoch
My Lords, do the Government agree with their own lawyers who have advised that it is illegal to allow the ECJ to police something that is not in the treaties—in this case, the proposed fiscal compact’s debt brake rule? Would it not be wiser to insist that the eurozone follows its own law in the hope that that brings an orderly end to the euro, with a return to national currencies at agreed initial exchange and interest rates? Is that not the only sensible way forward?
Lord Howell of Guildford
The noble Lord is letting his vivid imagination roam into the future. We have not reached the situation that he describes; perhaps we never will. I have made it clear that we reserve our position on how and which institutions should be used and how they may usefully be used to police the new intergovernmental treaty. These matters are yet to be decided; the position, I repeat, is reserved.