The Minister for Europe (Mr David Lidington)
I beg to move,
That this House takes note of European Union Document No. 5080/15 and Addenda 1 to 4, a Commission Communication: Commission Work Programme 2015–A New Start; and supports the Government’s view that the most significant initiatives are those that focus on the strategic priorities set out by the European Council in June 2014 to promote jobs, growth and investment in the EU.
This is the fourth such debate in which I have taken part as Minister for Europe, but I think it is the first time I can say that the European Commission has sent a strong message that it intends to do things in a different fashion from how its work has been carried out in the past. The clear message from President Juncker and his team is that they want to focus on a smaller number of key priorities and that they wish to set limits on the degree to which the Commission, and the EU collectively, can interfere in matters that are often better handled at national or local level.
Of course, the test of that message will be what happens in practice; it is actions that will count, not words. However, I am encouraged by the creation of the powerful post of First Vice-President of the Commission, which gives Frans Timmermans, the former Dutch Foreign Minister, an overarching power to veto any proposals that do not meet the requirements of subsidiarity and proportionality. He is already making it clear that a key element of his responsibility is to say a firm no to fellow commissioners, to the European Parliament and to outside lobbyists and to focus only on those matters where the Commission judges that European action would genuinely give Europe added value that could not be achieved by other means.
Sir William Cash (Stone) (Con)
I have spoken with Mr Timmermans a number of times in COSAC meetings with the chairmen of the 28 member states. On the question of national Parliaments, which is the key question in relation to subsidiarity—it is the question of what should be done best at the appropriate level—is not it the case that, for all the words about involving national Parliaments, we will not get much change out of Mr Timmermans, any of the Commissioners or the European institutions if we insist on national Parliaments at the expense of the European Parliament?
Mr Lidington
I do not want to pre-empt tomorrow’s debate on the European Union’s relations with national Parliaments and the principles of subsidiarity and proportionality. My hon. Friend is right to identify this as a challenging agenda and to indicate that the European Parliament, in particular, is likely to be resistant to the idea of a stronger voice for national Parliaments, but I think that he is too pessimistic in his assessment of Frans Timmermans. After all, it was during Mr Timmermans’s tenure as Foreign Minister of the Netherlands that the Dutch came forward with a number of specific proposals for strengthening the role of national Parliaments in holding EU decisions to account. I take heart from the fact that we have in this powerful role within the Commission somebody who has previously gone on the record to say that the guiding principle should be, “Europe where necessary, but national where possible”, and who has been very sympathetic to ideas for strengthening the role of national Parliaments.
The Commission has set out a clear intention to be more strategic and to act in a smaller number of areas where there is real added value for the EU. It has also said that it wants to demonstrate a particularly strong focus on jobs, growth and European competitiveness, which are objectives that the Government strongly support. The Commission has pledged to create a closer partnership with member state Governments and national Parliaments. We can see some evidence of the Commission’s approach by looking at some of the numbers in the work programme. The work programme includes just 23 legislative and non-legislative policy initiatives and—importantly— 80 measures proposed for either withdrawal or modification.
Mr John Redwood (Wokingham) (Con)
Does the Minister not note that most of the measures being withdrawn are either obsolete, having been superseded by a measure that has already gone through, or being withdrawn in favour of a more ambitious proposal? It is complete nonsense to say that the Commission is giving up power and wishes to do less. This is a massive work programme and the 80 measures are just a con trick.
Mr Lidington
I think that my right hon. Friend is being too pessimistic. As I said earlier, the test will be whether at the end of five years we can look back and say that the Commission has delivered in practice what its words indicated at the start of its tenure. I completely accept that there is a real problem with the Commission’s working culture, which, to be fair, like many national Government Departments, tends to judge success by the output of new law and new regulation, rather than the quality of what is actually done on a number of core priorities.
I was pleased to note that the Commission confirmed this weekend that 73 of the measures proposed for withdrawal have now been formally withdrawn. By comparison, the 2014 work programme proposed 29 new initiatives and prioritised a further 26 measures for adoption, and in 2010 there were some 300 new measures proposed. This work programme is focused on fewer measures, and on measures that will encourage growth and jobs, deepen the single market, conclude trade agreements and improve regulation, freeing up business from unnecessary regulatory burdens. The Government welcome that new focus.
Jacob Rees-Mogg (North East Somerset) (Con)
I cannot agree with my right hon. Friend. Of the 73 proposals being withdrawn, 71 are either obsolete or have already been blocked by the Council. Of the 79 actions being withdrawn under REFIT, 58 are evaluations or studies, five are proposals to codify, two are proposals to simplify, one is a proposal for a simplified framework and two are proposals for an update or a review. There is only one that would reduce something, against 452 Commission proposals, less the 73 that are sitting on the table. He tells us that this is a great success for Europe. What would be failure?
Mr Lidington
Failure would be Europe failing to give priority to job creation, economic growth and competitiveness at a time when a horrifying number of people, particularly young people, are out of work in this continent and when European competitiveness is not only slipping behind that of the United States, but is at risk because of the global shift of economic power to Asia and Latin America. The answer to those economic challenges lies in Europe raising its game dramatically as far as competitiveness is concerned.
Keith Vaz (Leicester East) (Lab)
I congratulate the right hon. Gentleman most warmly on lasting the whole Parliament as Minister for Europe, which must be a first. I understand that he and the Government received this Commission work programme some time ago, so why has it take so long to get it to the Floor of the House? I might be wrong about that, so will he clarify when the Government first received it?
Mr Lidington
I can check the precise date and let the right hon. Gentleman know. There has been a delay, which I regret, because it has taken time to get collective agreement on this and on a number of other debates that the European Scrutiny Committee has referred. Originally, we considered having this debate in Committee, but, having discussed the issue with my right hon. Friend the Leader of the House after he had given evidence to the European Scrutiny Committee, the Government decided to have a debate on the Floor of the House. I am just glad that we are having this debate relatively early in 2015.
Sir William Cash
I suspect that that is an invitation to say that the amendment that I and many other members of my Committee have tabled, which I hope the Minister will accept, deals with free movement—a massive issue that affects immigration. The fact that it has been not merely delayed, but stalled for more than a year must have been a coalition decision, but we have not been told who was behind it, so who was it?
Mr Lidington
As I told my hon. Friend when I last gave evidence to his Committee, the Government take decisions collectively and it would not be right for me to go into detail about internal Government communications. I will come to the issues raised by the amendment shortly, but first I want to say more about the importance of the proposed work on economic affairs and competitiveness.
The United Kingdom has long argued for ambitious trade deals. The ongoing Transatlantic Trade and Investment Partnership and EU-Japan negotiations could benefit this country annually by more than £15 billion, so the comprehensive stocktake of trade policy proposed by the Commission is welcome.
The EU’s greatest achievement—the single market—is still very far from complete, so we are pleased that the Commission plans to push liberalisation in sectors that could boost GDP the most, such as construction and professional services. We want EU legislation to enable the dynamic development of the future economy by supporting and not hindering a continent-wide digital single market. If that is done right, in a way that encourages the growth of online trade—both retail and business to business—it could generate €250 billion over the lifetime of this Commission.
We also support the Commission’s vision of a well-regulated and integrated capital markets union of all 28 member states that maximises the benefits of capital markets and non-bank financing for the real economy. Lord Hill’s recent Green Paper on the subject spelled out the approach he plans to take, and the Government will, of course, engage with his team as the policy is developed further.
We welcome the fact that the Commission intends to consider a range of approaches, and not just legislation, to develop Europe’s capital markets, and that much of that will be delivered through member state and industry action, rather than through EU-level law or regulation.
Mr Redwood
Will the Minister comment on the investment programme, which is said to be significant? How much of it is a spending commitment by the European institutions from their levies on member states, and how much will be done by gearing and leverage through guarantees and loans?
Mr Lidington
If I get the chance, I will give my right hon. Friend the exact figures at the end of the debate, but only a relatively small amount of the European fund for strategic investments—the so-called Juncker package—is derived from reallocating parts of the existing EU budget. The majority of the proposed €315 billion for the EFSI relies very much on private sector input on the basis of gearing.
Perhaps my right hon. Friend will be reassured to know that when I visited the European Investment Bank recently to discuss its approach to the programme, it was very firm in saying that it took very seriously its responsibility to its shareholders—the member states—and that it would exercise its responsibilities as a bank, that there would be due diligence, that it was not prepared simply to wave projects through on the basis that any sector or country deserved a particular slice, and that it would look at the real economic benefit that each proposal for capital investment offered to Europe as well as to the member state.
One of the sectors that we think could benefit from the EFSI is energy, where there is a need for work on interconnectors that would not only make more possible a genuine single internal market in European energy, but meet the strategic objective of trying to reduce European energy dependence on Russia. We think that the Commission communication on energy union is an important step towards not only strengthening Europe’s energy security, but decarbonising our economies and deepening the internal energy market.
Mr Christopher Chope (Christchurch) (Con)
On trying to reduce dependency on Russia, how does President Juncker’s recent proposal for a European army to stop President Putin in his tracks fit into the work programme?
Mr Lidington
In fairness to President Juncker, with whom I do not agree on that point, it is not a secret that he has held that view for a long time and I suspect it is held by pretty much every leading politician in Luxembourg. [Interruption.] That is the reality. A small European country would see an obvious benefit to its national interest from that sort of greater European action. The British Government do not share the view that a European army would be helpful or necessary. We believe that NATO is and should remain the centrepiece of our collective defence and security arrangements.
Were there to be any move towards establishing greater European military integration, it would first require consensus among member states, because such matters cannot be determined by a qualified majority vote under the treaty. Moreover, as I am sure my hon. Friend will recall, in passing the European Union Act 2011, this House required that there would have to be both an Act of Parliament and a referendum of the British people before any British Prime Minister could give consent to a proposal for the establishment of an EU army or armed forces in some hypothetical future.
Sir William Cash
Of course, if we were no longer members of the European Union by that time, we would not need to give consent because we would not be in the position to do so.
Mr Lidington
We can argue about all sorts of improbable hypotheticals, but the key point is that, while President Juncker was expressing a view that he has made no secret of holding in the past, this is not a live issue for debate around the table in Brussels at the moment. In fact, both President Juncker and others who have spoken in support of a European army or defence force have said that they see it as being a very long-term objective.
Turning to the amendment tabled by my hon. Friend and a number of other members of the European Scrutiny Committee, the Government recognise public concerns about immigration from other member states and the need for the Commission to do much more to address the abuse of free movement rights and the problems to which it gives rise. That is why this Government have gone further than any previous Administration to try to tackle the problems associated with free movement both domestically and at the European level.
We have acted domestically to tackle abuse and ensure that the rules governing access to our welfare system and public services are as robust as possible. Only today, my right hon. Friend the Secretary of State for Work and Pensions has laid regulations in Parliament to ensure that EU jobseekers have no access whatsoever to universal credit.
At European level, we secured language in last June’s European Council conclusions on the need for the Commission to support member states in combating the misuse of free movement. We continue to work both with member states and the Commission to reform EU social security co-ordination rules so that they better reflect current migration patterns and the divergent, diverse nature of member states’ welfare systems, while ensuring that member states can maintain effective control of their own welfare systems. Welfare provision is of course set down in the treaty as belonging to the competence of member states, rather than that of European institutions.
We welcome the proposal in the work programme on the labour mobility package—it covers several such items—which will assist us in carrying forward our ideas. However, we are very clear that there is much more to do, as my right honourable Friend the Prime Minister made clear in his speech on 28 November. I therefore have no problem in welcoming the amendment tabled by my hon. Friend the Member for Stone (Sir William Cash), which will be agreed to at the end of the debate.
Jacob Rees-Mogg
I commend my right hon. Friend’s wisdom in accepting the well thought through amendment tabled by my hon. Friend the Member for Stone (Sir William Cash). In relation to the debate on free movement, will Her Majesty’s Government reconsider their stance on Switzerland? If we are serious about renegotiation, it seems to me that we must take a sympathetic view of its effort to get out of the principle of free movement. If that is one of the four fundamental principles applied to Switzerland, which is not even a member state, how can we have a thorough renegotiation?
Mr Lidington
The challenge the Swiss Government face is that they have entered into a series of bilateral agreements with the European Union linking a number of different elements together. For example, in the Swiss bilateral treaties with the EU, access to some of the EU’s single market provisions is explicitly linked to accepting the principle of freedom of movement. At the moment, it is written into that package of bilateral treaties that if one is revoked or renounced, all of the agreements will fall by a certain deadline. That is the challenge the Swiss Government face following the referendum early last year. We remain in close touch with Switzerland, a friendly country, and we hope that we can find a satisfactory way forward.
Mr Lidington
If my hon. Friend will allow me, I am conscious that the debate is time limited, and I want to let other Members speak.
Before I conclude, I want to refer to the question of regulation. During his hearing in the European Parliament, Vice-President Timmermans pledged to conduct a review of pending legislation, which was completed in late 2014; to launch a revised inter-institutional agreement on better law-making in spring 2015; and to conduct a review of better regulation by October 2015.
We are continuing to work with other member states to implement the recommendations of the Prime Minister’s business taskforce on EU regulation—the introduction of EU burden reduction targets, even greater use of lighter regimes and exemptions for small and medium-sized enterprises and micro-enterprises, and greater independence and powers for the Commission’s Impact Assessment Board.
Thirteen of the 30 recommendations of the Prime Minister’s taskforce have been fully implemented at European level, and progress is being made on others. The Commission has set out its intention to review, recast, merge or replace some 79 EU Acts as part of its Refit programme. We have long pushed for EU legislation to minimise unnecessary costs to business, particularly SMEs, and it is positive to see that reflected in the work programme and what appears to be a reinvigorated approach by the Commission to better regulation.
Overall, the work programme shows encouraging signs that the Commission wishes to take the EU in what we consider to be the right direction, at least on the economic priorities. It is important to judge the Commission by what it now does in practice. In our view that means implementing the work programme in a way that respects the principle of “Europe where necessary, but national wherever possible”, reduces the burden of European regulation on business and eliminates barriers to growth, and supports increased competitiveness, trade and the completion of the single market. If that is the outcome, it will demonstrate important progress in the Government’s EU reform agenda.
During the past five years, we have already secured the first ever reduction of the EU’s budget; significant reform of the common fisheries policy, including a ban on discards; the launch of talks on an ambitious transatlantic trade deal; and important protections for non-eurozone countries in respect of banking union. Just five years ago, it would have been unthinkable for the first work programme of a new Commission, which would want to demonstrate its ambition, to contain just 23 priority initiatives. That is evidence that this country’s messages are being heard and acted on.
We launched this debate, and today there is growing consensus across Europe in favour of reform. We will continue to work energetically to ensure that the EU becomes more competitive and democratically accountable, deepens the single market to enable free movement of services and capital, and tackles abuse of the principle of free movement. I commend the motion to the House.
Keith Vaz (Leicester East) (Lab)
I will be as brief as possible, Mr Deputy Speaker.
As ever, it is a pleasure to follow the hon. Member for Stone (Sir William Cash), who has always spoken with authority on European matters and whom I congratulate on his persistence in getting these issues debated in the House. We do not know quite how long the delay has been since the Commission decided to have its work programme—
Mr Lidington
The work programme was published on 17 December, the explanatory memorandum was laid before Parliament on 14 January, the European Scrutiny Committee referred it for debate on 28 January and we are debating it on 9 March. It is not as long a delay as there has, I am afraid, been with some others.
Keith Vaz
I am most grateful to the Minister. It might not seem long to him, but, picking up on a point made by the shadow Minister, it is good to have these matters debated in the House as quickly as possible. If Parliament is to have any influence on the Commission, it is good to have them before us as quickly as possible.
Mr Lidington
With the leave of the House, Mr Deputy Speaker
I am grateful to all Members who have spoken. Let me begin by dealing with the point with which my hon. Friend the Member for North East Somerset (Jacob Rees-Mogg) ended his speech, and which was touched on by my right hon. Friend the Member for Wokingham (Mr Redwood). The United Kingdom does not intend to participate in the two tax measures to which they referred, although we take an active role in discussions as those issues evolve, in order to ensure that we can resist a design which, even if such measures were taken forward by enhanced co-operation, might have an inimical impact on the interests of this country. Of course, if either measure came forward through the EU process to a decision by the Council or the Commission, it would be subject to scrutiny in the usual way, and Treasury Ministers would, I am sure, give evidence to the European Scrutiny Committee if asked to do so.
My right hon. Friend the Member for Wokingham also asked about the Juncker initiative. It involves the reallocation of €16 billion from other headings in the EU budget, and €8 billion from European Investment Bank resources. That sum of €24 billion is intended to allow for leveraging from other sources to produce the total of €315 billion that is being discussed.
A number of Members, notably the right hon. Member for Leicester East (Keith Vaz), spoke of the challenge posed by migration across the Mediterranean from Africa. The Government are very active through, for example, the Khartoum process, which involves EU states working with countries in the Horn of Africa, through our support for the three EU common security and defence policy missions which are intended to stabilise Somalia, and through our support for a comprehensive EU approach to the Sahel region. If we bring about more stable governance and some hope of a job and an economic future for the people in those countries, there will be less opportunity for the people traffickers, because there will be less desperation among the people. That needs to be part of this process, along with co-operation on criminal justice to disrupt the people traffickers and prevent them from going about their nefarious trade.
The right hon. Member for Wolverhampton South East (Mr McFadden) asked about bids from this country under the EFSI. The EFSI is still formally to be established. We have drawn up a provisional long list based—