EU: Balance of Competences Review
(9 years, 9 months ago)
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Baroness Falkner of Margravine
To ask Her Majesty’s Government, on completion of the European Union balance of competences review, how they will use the information gleaned.
Baroness Falkner of Margravine (LD)
My Lords, I declare that I am on the advisory board of British Influence; a British member of the Anglo-German Conference, Koenigswinter; and a member of the advisory group of Demos, the think tank. I bring in the latter as I will comment on its evidence.
Before I begin my substantive remarks on this balance of competences review, I commend the Minister for the role that he has played both in the Cabinet Office and with the FCO Minister, David Lidington, in delivering the 32 papers. The House is truly in their debt. I should also note that the European Select Committee of this House—I am delighted to see that the chairman is here in his normal place—is conducting an inquiry into this exercise and I look forward to its report, which I understand will be published shortly.
In July 2012, in the Command Paper setting out the parameters of this review, William Hague said:
“Now is the right time to take a critical and constructive look at exactly which competences lie with the EU, which lie with the UK, and whether it works in our national interest”.
This Command Paper was the product of the coalition agreement, which pledged to examine the balance of the EU’s existing competences. As William Hague went on to say:
“It will ensure that our national debate is grounded in knowledge of the facts and will be a vital aid for policy making in Government”.
This has been a marathon. In fact, given that a marathon is 26 miles, the publication of 32 papers has overtaken that finish line by some distance. When the most contentious paper was delayed—that dealing with the free movement of persons—ostensibly due to coalition squabbles over its content, many wondered whether the exercise would and could be completed successfully, given that impartiality was to be a benchmark. But again, this coalition Government have confounded the sceptics in producing papers that are balanced, fact-based and widely contributed to, setting out clearly where the wins, the draws and the losses lie for the United Kingdom as a single state when the EU negotiates with and legislates for 28.
It is fair to say that after the initial incredulity in the media about quite how balanced the papers were, they have elicited so little publicity that one fears they might just quietly end up on a shelf. But this lack of media attention does not detract from their merit. I predict that, when and if a referendum gets under way, they may well get a bit of a dusting down.
Nevertheless, one objective of the review bears examination: the question of how many partners from other EU member states and EU institutions engaged with this exercise. I know that the EU committees of this House have a multiplier effect in terms of our scrutiny, but noting our reports is a different matter from that of actively participating in a shared analysis of common problems. A lack of engagement could signal how out in the cold the UK has been from the rest of the Union. So I hope the Minister will be able to tell the House which other member states and institutions contributed to the analysis of these reports.
However, the overarching question has to be about where we go from here. The White Paper stated:
“A final decision will be taken closer to the time on how best to draw together the analysis produced during the review in the light of the EU’s rapidly changing situation”.
With my noble friend Lady Ludford, who has extensive experience on the EU end of this relationship and now leads on EU matters in this House, I attended the evidence session that the EU Committee of this House conducted yesterday with the Minister for Europe, Mr Lidington. He was asked where we go from here and, unsurprisingly given that the election is a few weeks away, he was non-committal. It is clear that this was conducted between two parties with very different views of the UK’s role in the EU, and could have turned into a far more partisan exercise than it did. However, I did get the impression from yesterday’s session that there would be a little selective emphasis on the analysis, should the Conservatives win the next election and move towards their referendum.
What if Labour wins the election? We know that it has ruled out an in/out referendum. But, given that it has taken the Government some 42 years after the UK joined the European Economic Community to carry out such a thorough exercise, one would hope that if Labour were in power, it would not leave these reports to gather dust but would actively use the analysis to guide its policy-making. It is notable that the treaties of Amsterdam, Nice and Lisbon took place on its watch without it undertaking any such exercise to inform themselves about the British people. I hope that the noble Baroness, Lady Morgan, will commit in her reply to build on that work.
What could be the useful purpose in practical terms? One way to build evidence would be to have a dedicated website hosted by the FCO or the Cabinet Office, which would be updated periodically as directives, regulations and case law developed. That could be accompanied by a refreshment of the analysis every now and then when the pace of change merits a different emphasis or conclusion.
We know that there is now a residue of EU expertise built up in each government department. Without very much additional cost, those roles could be maintained to keep a watching brief on changes. In other words, it could be possible to hardwire an area of EU analysis into each functional department.
I am aware that Liverpool University’s European law unit is undertaking detailed work on the methodology and statistical analysis of the evidence. That is important, as the data contained in the report are already at risk of being outdated, given that the research started in 2012. Liverpool has suggested a synoptic review of the reports, which is sensible, but I go further and suggest that they are periodically refreshed.
I turn to the substance of some of the reports—although, in the limited time, I shall have to be very brief. The report on foreign affairs was one of the early reports and is therefore somewhat dated. However, its evidence suggests that the creation of the External Action Service has understandably been challenging—as has been particularly experienced in the division of the responsibilities assigned to the high representative, who is as well the VP of the Commission. Some years on, the notable success of the high representative’s role in the E3+3 talks in Iran and the transition in Burma show that, when the EU has a clear focus, the sum can be greater than its parts. I should pay tribute to the noble Baroness, Lady Ashton, in that role. However, the real test will come here in Europe itself, where any divisions over Russia could have a disastrous impact on not only EU security but EU cohesion overall. A further point of potential disunity will be China, where we have seen selective attempts by the Chinese to play on bilateral relations to the cost of common EU rules, particularly in the area of competition policy.
I have a word or two to say on enlargement. The report commented on the use of conditionality after accession. It has been instructive to see that the co-operation and verification mechanism has been used for Bulgaria and Romania, because they did not conform to the Copenhagen criteria, but we have a fairly substantial slide into regression by Hungary and do not seem to be able to do anything about it. I accept that the Commission has been able to use limited infringement proceedings, but it seems rather impotent overall.
One wonders how egregious a state’s diversion from democratic values has to be before Article 7 of the TEU is invoked. That test is:
“a serious and persistent breach by a Member State of the values”,
but there seems little clarity as to whether the Commission can use EU law for a general failure to abide by the Copenhagen criteria.
I turn to a mild criticism by the EU Select Committee on the use of selective evidence in the free movement of persons report. In its letter of 22 October 2014 to the EU Minister, the committee states that,
“there was significant reference ... to evidence by Demos and Open Europe, evidence that was closely aligned with the position of the UK Government”.
As the noble Lord, Lord Boswell, will know, I have the highest regard for the committee, but I respectfully suggest that when there are strongly held views about a subject matter, such as immigration, as opinion polls show that there are in this country, it is not only inevitable but important for a report to reflect that in its analysis. Otherwise, it would not be balanced and would not therefore command public respect as a serious exercise.
Moreover, Demos and its director, David Goodhart, should be taken seriously, as his book, The British Dream, is an important contribution to the debate from the progressive side of the political spectrum. Demos is no tool of the right, I assure him.
Finally, with about 10 days left of this Parliament, this is probably the last time that we will have substantively to discuss EU matters in this House. With one EU Act, two referendum Bills and numerous debates and Statements on the Floor of the House, I thank my noble friend Lord Wallace of Saltaire for his regard, courtesy and good humour over five years, when he has covered such a wide brief with such knowledge and insight. We wish him a happy retirement after the general election.
Lord Balfe (Con)
My Lords, I begin with the statutory declarations as a vice-president of the European Parliament Former Members Association, chairman of its pension fund, a lifelong member of the European Movement and a member of the Conservative Europe Group—a flourishing group within the Conservative Party, let me say. Let me also say how much I appreciate the contribution that the noble Lord, Lord Wallace, has made to this House and the debate on Europe over many years.
This is of course a very traditional debate on Europe in that the party that makes them most noise—UKIP—has failed to appear. That is par for the course.
The balance of competences review is a mighty document, and we can deal only with selected parts of it. I want to deal with one or two issues within it—perhaps some of the more controversial ones. The first is the European Parliament itself. There are some fantastic suggestions in the document. Among them is one from a gentleman called Straw who lives down the corridor—or used to; well, he does for another 10 days. He suggests that the democratic legitimacy of the European Parliament could be increased by abolishing European elections. I am not sure that that is correct. I do not think that you increase the democratic legitimacy of anything by abolishing elections to it. I do recall that he has a bit of form. He was the one who opposed open lists for the European Parliament in 1999. I would say that we need more democracy in the Parliament; we need more knowledge about it. If we wish to reform, perhaps we should move towards open lists for the Parliament. This would of course reduce the terrible power of the parties but increase the democratic legitimacy of the list; it would also increase the ability of the electorate to choose who they want to represent them in the Parliament.
I feel also that we should build on the mechanism that we have through COSAC and other arrangements by which this House participates in relations with the other Parliaments of the EU. The trouble with talking about how you legitimise or increase the legitimacy of the European Parliament is that that is not the problem. Developments are needed to develop the COSAC system and the system of interlinking our different countries. I am not particularly campaigning against the Commission, but the fact that the yellow card procedure has hardly been used and the orange card not at all is a weakness in the procedure. We need to look at things much more thoroughly, because the Commission needs to be pulled up by its national Parliaments, not just by the EU.
I move on from there, in the democratic tradition, to look at the issue of voting in elections. The competences review is very interesting on that, because that is where we really get to grips with what matters in countries. My view is that the voting system in the United Kingdom is a complete and utter mess. If you come from Bangladesh, you can be on the electoral register as soon as it is produced after you land. I have nothing against people from Bangladesh or any other Commonwealth country, but it seems to me ridiculous that citizens of France who come to London, work in London and pay taxes in London have no say. I am in a minority in this House—certainly in my present party and in my previous party.
I do not think that Brits who go abroad should be given the vote at all. I think that the essence of democracy is control over the state that you live in. The essence of democracy should be that we extend to all taxpaying citizens who live in this country a vote. If you pay tax into the British Exchequer, I am not really bothered whether you come from France, Denmark, Bangladesh or Nigeria, you should be given a vote in return for the money you pay for the society that you live in.
We have got part of the way with local councils and European elections, but I completely reject the notion in the competences review on voting, because I think we are going the wrong way. Surely it is ridiculous that if you are a Cypriot or Maltese citizen of the European Union you can vote here in the elections. So there are citizens of two countries in the European Union who can vote—but for the wrong reasons, you might say.
My third point concerns migration. A huge amount is said in all parties about migration. One party apologises for it, the other party wants to stop it and I think the third party may be half right in its policy. Look, we have a problem with migration because in 2004 Britain decided that anyone anywhere in the joining countries could come and live in Britain, so a lot of people in eastern and central Europe who looked at the future said, “Oh, we can go and work in Britain. We can’t go and work anywhere else, but let’s go and work in Britain”. So they came here and they have contributed enormously to the economy of this country. One of the reasons, I believe, that Britain is an expanding and booming economy–in the European sense, which is not much of a sense—is because of the people who have come to work here in Britain and are contributing to our economy. We should celebrate that.
We all know that patterns of migration tend to follow chosen paths. If people come here from, let us say, Poland, which has been a big contributor, more people will come from Poland, because they will know people here. So let us not start grumbling about a problem—if it is a problem, and I deny that it is—or about a situation that we ourselves brought about. We opened the borders. We said, “Come to Britain”. I would love to see the papers, because I do not believe that it was an accident. I like to believe that there were people in the previous Government who had the intellectual capacity to sit down and analyse the problem. They worked it out, probably correctly. There is probably something buried, which we will see under the 30 year rule, in which someone—it was probably the noble Lord, Lord Mandelson, because he was one of the brighter members of the previous Government—sat down and said, “There are a lot of bright people in eastern Europe, how can we get all those people with degrees and PhDs and skills and drive to come and work in Britain? I know, we’ll open the borders”. I would love to see those papers, because I am sure that they exist. I do not think that this could have happened by accident and I do not think that we should be consistently condemning it.
My final point is on enlargement. Those who have known me for a long time will not be surprised that I wish to mention Turkey, a country I have had a lot to do with in the last 30 years, and a country which the European Union has consistently deceived. As long ago as 1961 we signed a treaty—or rather, the European Union did, before we joined—saying there was a prospect of membership for Turkey. We signed up to the common acquis when we joined in 1974. Ever since then we have been holding the carrot in one hand and the stick in the other. In the mean time, the European Union has enlarged and enlarged and enlarged again. It was six countries when that promise was made. It is now 28 and there is still no sign. I believe that we have to stop playing around with Turkey.
It is possible, as the EU develops, that we could actually have a three-circle union. We talk about a two- speed Europe, but there is a third Europe, the Europe of the Council of Europe, of countries that are neither considered nor probably will ever be considered for membership of the European Union. Then there are countries on the penumbra. There are the western Balkans. There is Turkey. If we have objections to a Muslim state, do we have objections to Albania? I do not believe that we do have objections to a Muslim state; I think we have objections to a big state. I do not think that big countries want another big country around, but I do think that we need to clarify our views on Turkey. Certainly, if we need and wish to influence it, we need to open the chapters on accession. Having opened the negotiations, to leave the chapters closed that we need to talk about to get the community acquis agreed on both sides is a dereliction of duty.
I hope that the Minister can assure us that the Government will be putting all their efforts into this. Do not bring Cyprus up: we knew what we were doing when we let Cyprus into the EU. Everybody said, “If you let Cyprus in as a divided island, it will block all progress”—so let us not say that we did not know. We knew what we were doing and it is now up to us to get ourselves out of this jam.
Baroness Ludford (LD)
My Lords, I warmly thank my noble friend Lady Falkner for initiating this debate. I declare an interest as a former Member of the European Parliament and now a pensioner of the said institution.
I was one of those who was a bit suspicious of the balance of competences review and its motives—not as much as some of my political colleagues, but I was mildly sceptical as to its value. I am happy to admit that I have been proved wrong, and I am in danger, indeed, of having the zeal of the converted.
I was already somewhat reassured by the statement in the Command Paper that launched the review in 2012 that it would not be asked,
“to look at alternative models for Britain’s overall relationship with the EU”.
That somewhat allayed one’s fears about it being the basis for a renegotiation exercise, but I do think that, in fact, many of its aims have been fulfilled. The objective was,
“a thorough and analytical piece of work … to take stock of the impact of the EU on our country … to … allow everyone, those in Government, in Parliament and, most importantly, the British people themselves”—
I shall come back to that—
“a far better understanding of an important part of the governance of the UK … ensure that our national debate is grounded in knowledge of the facts … and develop this country’s policies in relation to the EU”.
Like my noble friend Lady Falkner, I have taken an interest in the valuable inquiry by the committee of the noble Lord, Lord Boswell. I shall quote the evidence from Dr Thomas Horsley from Liverpool University’s European law unit, which gives a very positive view.
“I think that overall we would summarise our assessment as positive of the review. We would say that as a whole the individual reports are an impressive technical exercise in attempting to understand the current balance of competences across a range of fields, and to try to collate in a fair, synthesised and balanced manner the range of responses that were received as the evidence base. In result, the exercise has provided a very rich, unique resource that we suggest is greater than the sum of its parts”.
I think that that is a great tribute to the Foreign and Commonwealth Office and the Cabinet Office and, indeed, to my noble friend Lord Wallace of Saltaire and other colleagues in Government, including the Europe Minister, David Lidington, who I am very pleased has kept his post throughout these five years.
The review is most certainly not a whitewash. Every one of the individual 32 reports has criticisms of aspects of EU policymaking. As those Liverpool academics said, the reports are a faithful synthesis of the full range of evidence and there is no sign of an attempt to prejudge conclusions and select evidence to fit those prejudged conclusions. So it has integrity as an intellectual exercise and it has certainly provoked debate.
We have seen more businesses in the last couple of years prepared to speak out on EU affairs. They have been mainly positive about the EU but ready to complain or criticise, where they saw the need to do so. It is almost as if the review has liberated people to talk, without it being politically loaded, about what the EU does and does not do well. Now we need to reflect on how the engagement with stakeholders at home and in other member states will be continued and built on, in particular to develop intelligent, well founded ideas for reform of the EU and refreshment of the way that it operates.
We learnt from the Europe Minister, Mr Lidington, yesterday that the paper which the UK submitted on the development of the digital single market, on the basis of the balance of competences review, was very well received in Brussels. His officials mentioned energy union as another topic on which the work done in the review could contribute reflections of value.
It is true that we need to wonder how we can move that interest from organisations in the private and public sectors and other Governments into the more popular public domain. I have no brilliant ideas on how to do that, but some of the businesses and NGOs that participated in the review are helping to disseminate their experience among their memberships. As has already been commented, media coverage has been relatively limited—but then the media on the whole only ever want to report sensationally bad things about the EU. The danger is that the value of the review will get overshadowed or squeezed out by the sloganeering of a possible referendum campaign, which would be a great pity.
I will mention a few of the themes that I felt were valuable in the review. The launch Command Paper in 2012 mentioned that,
“it is … important that the EU addresses the legitimate demands for greater accountability, transparency, efficiency and probity”.
In the light of the last few years, the contrast that the paper made between the EU and,
“the roots that sustain national democracies”,
may have been a bit complacent about the legitimacy of, for instance, Westminster. However, we need to look at questions of the EU’s legitimacy. Many people who do not really understand how their local council or town hall works, or how Westminster works, do not mind too much because they still think those are within their sphere of legitimacy. Unfortunately, the EU does not come into that category so it has to work even harder.
Like the noble Lord, Lord Balfe, I do not accept that the EU is not democratic, because the European Parliament is directly elected, but for those legitimacy reasons we also need to bring in fully the national Parliaments. I was extremely disappointed when the European Commission did not respond in the right spirit to the yellow card put up by, I think, 11 national Parliaments to the European public prosecutor proposal. That was very arrogant of the Commission and extremely regrettable. Perhaps under the new Commission, that sort of arrogance will not be repeated.
The balance of competences review was particularly valuable in its discussion of subsidiarity and proportionality, and in its coverage of impact assessments and how we get better lines of accountability. Some other things were not covered very well, as I think was commented on. Enhanced co-operation, flexibility and inter-institutional relations, which were mentioned by the Minister yesterday, were not really covered and could have done with some attention. The paper on fundamental rights was very interesting, with a useful discussion on the value in particular of EU accession to the European Convention on Human Rights. That would mean that you would be able to take the EU to court when it tramples over rights.
When I was preparing for this debate and thinking of the legitimacy of the EU, one thing I read was the news that small cider and perry makers might have their excise duty break removed because it is seen as a contravention of state aid. I thought, “Must this really be the focus of a Brussels crackdown?”. If we really do not want to alienate people, given their attachment to the workings of Brussels, that does not seem to be going about things the right way.
I am running out of time so I cannot say anything about justice and home affairs, which is very close to my heart. I finish by mentioning that I felt that this report is very useful as a contribution to the ideas on reform, but it is a somewhat technocratic exercise. It is not the whole of the debate on the value of our membership of the EU. There is the question of how we prepare the EU for the pressing challenges to deliver prosperity and security for our 500 million citizens, and the influence that Europe’s voice can have in the world. The answer to that challenge inevitably goes beyond, and wider than, the balance of competences exercise. However, in its own right it is extremely useful.
Lord Maclennan of Rogart (LD)
My Lords, I, too, express my gratitude to my noble friend Lady Falkner for initiating this useful debate. I also congratulate the chairman of the Select Committee, the noble Lord, Lord Boswell, on having a meeting with the Minister for Europe, Mr David Lidington, on this subject as recently as yesterday. The Minister answered questions with great intelligence and wisdom but did not answer all the questions which were put to him, as the evidence will reveal in due course. That was almost inevitable, because the reports are so extensive in their coverage that it would have been impossible to reveal all the conclusions in that time.
When the exercise was launched, in mid-2012, it was expected, and indeed it was stated, that the review on who does what between the EU and the UK would form the basis of a United Kingdom bid to renegotiate the Treaty on the Functioning of the European Union. It was also intended that it would inform a possible referendum on EU membership in 2017. In some ways, it has to be said, these objectives have not been met.
The Minister indicated that it was not feasible to have an overall analysis of the multiple volumes of the report, which were organised by different departments but not according to a particular structure; they vary from one to another. I understand that, although I would be much happier if the Government extracted from these reports the messages that have to be conveyed to the British public. The public are not sufficiently aware of what is going on in the European Union or of how our relationship with the institutions works. That could yet be an outcome of this series of inquiries. I hope that, after the election, there will be a reconsideration of these matters. No money was put aside to convey the messages of the reports to the general public. It scarcely sums up what the future policies of this country will be in respect of the European Union.
We have to recognise that, in many of the reports, there is no real conclusion. Many facts and many opinions are enunciated by those who gave evidence, but some of this is left up in the air. The report on the balance of competences between the United Kingdom and the European Union in respect of the EU budget illustrates this point very well. The operation of the multiannual financial framework has been advocated yet also criticised. The expenditure schemes are subject to different views among the different parties. There is different evidence: academic evidence; evidence from the devolved Governments in this country; evidence from Members of the European Parliament—evidence from all quarters. It is not surprising that there were not significant attempts to draw together the evidence.
What I think is missing from this review is what the Government think. Yesterday, the Minister, Mr David Lidington, was extremely cautious in making his points, so the case for change in the European Union was scarcely articulated.
I do not expect my colleague the noble Lord, Lord Wallace, to come to any conclusions in the few minutes that he has to conclude this debate. It would also be, to some extent, untimely. We need an overall review of the evidence that has been given, to inform the public and enable them to know what the Government’s reaction to all this evidence is.
It seems sensible to use the review in the renegotiations on the relationship with the European Union. My personal view is that it would be sensible to have another convention on the future of Europe. I served on the previous convention, which percolated some of its ideas down through various treaties which my noble friend Lady Falkner mentioned. What was so striking about the convention was that it brought about a consensus. People started from different angles of vision, but they listened to each other. That sort of process should be reconsidered. It should not be concluded before the elections in Germany and France in 2017, but it could be started before then. The evidence from the reviews from the different departments could be put to other countries and other representatives at such a convention. It would enable, or stimulate, other countries to consider how they might evaluate the problems and the structures of the current situation. The work has been well done but it has not been concluded. We need an overview and we need the recommendations, in so far as they exist, to be made public, so that people will have a better understanding of how the European Union and the United Kingdom work together.
The Earl of Dundee (Con)
My Lords, I want to pick up briefly three themes: the European Union’s function to maintain peace in Europe; its task to assist the well-being of its citizens and their economies; and its external role of fostering international stability.
To achieve proper results, it is clear that the European Union’s competences should always be under scrutiny. Let alone at present, there is a case for that at regular intervals and at all times. It is also important that the performance and competences of its 28-state affiliation should be judged and reviewed in association with those of the Council of Europe’s 47-state affiliation.
Not least is this plain in considering the European Union’s function to maintain the peace of Europe. For the backbone of European peace is the consensus shared by Council of Europe member states on human rights and the rule of law; and the court’s ability, if need be, to uphold the rights of an individual citizen against a nation state. Until the Second World War, this would have been unthinkable. The fact that it no longer is, even if only symbolically, has exerted a powerful curb on nationalism and those of its policies which have led to European wars. Does my noble friend the Minister, therefore, agree that the European Union’s peacekeeping function and any adaptations of related competences must be closely allied to those of the Council of Europe?
Assistance to the well-being of citizens and their economies also requires the joint efforts of the European Union and the Council of Europe. We hear much about the democratic deficit: the alienation of people and voters from politicians and parliamentarians. Yet in the present Europe one great opportunity is that for grassroots democracy and the scope for flourishing regions and communities. Does my noble friend concur that this task is best accomplished by making full use of the respective competences of the European Union and Council of Europe together?
The same applies when fostering international stability; for this is done not just through trade and economic investment—the strengths of the European Union—but also through the moral authority and programmes of the Council of Europe.
Certainly, on all these fronts, whether internal or external to Europe, relevant adaptations to the European Union should be considered in the first place, as we rightly do today. For best results, however, the competences of these two complementary European institutions should be structured and reviewed together.
Baroness Morgan of Ely
My Lords, I thank the noble Baroness, Lady Falkner, for ensuring that this important debate has taken place. We are about to enter an election where the future of this country will be decided—not just domestically, but in terms of how we see our place in the world. The question we must ask is: are we going to pander to the hysterical, emotional and populist call to retreat from the EU, or are we going to take heed of the importance of the EU to our domestic economy and to our ability to have influence in the world?
What the balance of competences review has done has been to give us a comprehensive, thorough and balanced analysis of how the EU affects this country. Through analysing in detail 32 areas of policy in a systematic way, looking clearly to see if the principle of subsidiarity has been breached, the balance of competences review has given pro-Europeans valuable ammunition to tackle the sceptics with facts and figures. Labour will, of course, take these into account in its development of future EU policy when it is in government after May.
The publication of this study was one of the last gifts from William Hague to the country in his role as Foreign Secretary. When he took up the post he was not exactly known for his Euroenthusiasm but I am aware that the noble Lord opposite has steered the ship on this issue. We are grateful for his attention to detail on so many of these important issues. The European Union Committee under the chairmanship of the noble Lord, Lord Boswell, is undertaking a review of the whole process relating to this review. We look forward to hearing the results of its deliberations.
While the reports on the various discrete areas of policy are thorough and give both positive and negative assessments of the relationship and its value to the UK, it is notable that there is no overall assessment or conclusion as to whether the EU as a whole is good for the UK or not. For example, there are no recommendations and no clear guidance on the possible repatriation of powers. The result is that there has been little or no coverage of the review which has been perceived by many as a dull, technical exercise. This is a shame because there are some important and clear lessons for the UK to learn. It would probably be overoptimistic of us to expect anything other than that when the facts do not chime with the views of many British newspapers. The Leveson inquiry made it clear that the UK media often make up stories about the EU. Debate on this issue would have caused further ructions within the Conservative Party.
I should like to ask the Minister what his department or, indeed, any other department has done to publish and publicise the review reports and their findings. How much money has been put aside for this? If no money has been put aside, can the Minister explain how the Government intend to engage with the public on these issues if there is no effort to publicise the results of the review?
What have we found out as a result of the review? I should like to pick out three points. One issue which the review has highlighted is how Europeanisation is often a reflection of the globalised pressures on the UK or takes on board the wider, western multilateral efforts in relation to trade and foreign affairs. It is also clear that universities in the UK are particularly enthusiastic about EU membership and what they have gained through the various research programmes where they have notably punched well above their weight.
The report on the single market focuses on article 114 of the EU treaty and concludes very clearly that our markets are so closely integrated that it is not possible to establish a clear division between member state and EU competences in the single market area. In the opinion of most, if not all, observers, integration has brought appreciable economic benefits to the EU and hence to the UK. It has also spread the UK’s liberal model of policy-making more widely across the EU. But there is a recognition that it has brought with it constraints on policy-making of varying kinds and a regulatory framework which some industries handle better than others. There is recognition that the EU could strengthen its own enforcement efforts, as could member states.
It is impossible here to list all the benefits and disbenefits of the single market. It is worth noting that, in 2005, Her Majesty’s Treasury estimated that trade between member states was boosted by 38% through membership of the EU and by a further 9% because of the single market programme, with only 5% of trade diverted from non-member countries.
What was the point of the review? It was partly to paper over divisions on Europe within the coalition—to kick the European issue into the long grass. It was also surely in part to inform a possible renegotiation relationship between the UK and the EU, one that reflects the UK’s national interest. The report provides a very good base from which to work in any renegotiation discussion.
Labour has a very clear view on what we would like to see in that renegotiation. We will seek to reform the EU budget and will initiate a zero-based review of spending on EU agencies. We will seek to reform welfare so that people who come to work in our country have to contribute before they are eligible for benefits such as jobseeker’s allowance. We will close loopholes in rules for agency workers so that they do not allow unscrupulous employers to undercut wages and conditions. We will work with Europe to give national parliaments more of a say in EU policy-making as part of bigger reforms of the way Brussels operates and the way Parliament scrutinises EU business.
Where, however, is the detail from the Conservative Party? It is worth asking why the review was published so near the election and therefore cannot fulfil one of the original purposes of the review, which was to promote a calm and informed debate on the EU. The balance of competences review stands in stark contrast to the ill informed, populist nonsense spouted by UKIP and Tory Eurosceptics. It might have been just as useful to have had a competences review of the coalition’s relationship with the EU over the past five years. The mixed messages, the tantrums, the vetoes, and the failure to build alliances have all done little to endear us to our closest allies in the EU. There was the 2011 veto, which achieved nothing, but which upset our fellow EU member states; Cameron’s failure to see that an increased bill from the EU was coming; his utter humiliation over the nomination of Jean-Claude Juncker; his insistence on pulling the Conservatives out of the EPP and reducing their political influence; his failure to present a comprehensive and clear view of what he wants to see in a reformed European Union. If this exercise was an attempt to pacify Tory Back-Benchers, it has back-fired. They do not want an objective assessment of the usefulness of EU— they want out, irrespective of the damage to our economy.
The question is: will the public and political parties be swayed by fact or emotion on the EU issue? If the public can be persuaded by fact, this will be a useful report. My hunch, however, is that, as Gordon Brown suggested yesterday, we need to appeal not just to the head but to the heart on the EU, and we need to make the emotional and patriotic case to remain a part of that great institution.
I thank the noble Lord, Lord Wallace, for his work as Minister during this period and for injecting a note of sanity into the issue of the EU within the coalition.
Lord Wallace of Saltaire (LD)
My Lords, it is very good to hear a number of complimentary remarks at the outset of this debate. However, it sounded rather as if I was about to retire from the House and everything else as well. I do not intend to retire yet, thank you. Perhaps, like others, I hope to do so when I reach my 80th birthday—that is a hint to various other people who are not here.
This was a coalition exercise. It was agreed in the coalition agreement, and it was no secret that the two parties disagreed and had different approaches to Europe. This was set up as a means to find some common ground in the detailed evidence as to what stakeholders thought. We agreed that we would not produce policy recommendations at the end, because that would have been difficult—the two parties have widely differing approaches, or at least we do from the right wing of the Conservative Party. We therefore set out to provide an evidence basis for a more informed debate on the European Union. In that respect I think that we have been successful. I pay tribute to my Conservative colleagues in this exercise—David Lidington, who chaired the ministerial Star Chamber throughout, and Mark Hoban and then Mark Harper, who also took part. I thank the good-quality teams from the Foreign Office and the Cabinet Office who supported us throughout.
I say to the noble Baroness, Lady Morgan, that we did not leave publication until the last minute. The reports came out in four groups at six-monthly intervals, so this has been a two-year process. We are grateful that the weight of evidence has grown as we have gone on. Interest among stakeholders has therefore been sustained throughout that two-year period. There were some 2,300 submissions, and we held a whole range of meetings and seminars—across the United Kingdom, in Brussels and elsewhere—with substantial participation from the Community institutions, and other member states and governments.
Sadly, we heard rather little from the Eurosceptic side. I must, as I always do, pay a real compliment to the quality of the evidence produced by Open Europe throughout the whole process. The TaxPayers’ Alliance loyally put in a large amount of evidence, which was not, I think, always as expert as it hoped it would be. I said to one of my Conservative colleagues at one stage, “Why do we not have more evidence from the committed Eurosceptic side?”, to which he replied, “For heaven’s sake, William, these people are not really interested in evidence. It’s belief; it’s faith; it’s prejudice”.
Baroness Falkner of Margravine
My noble friend will, of course, be aware that the noble Lord, Lord Pearson of Rannoch, was meant to speak in this debate, but then decided he was not going to. I made the effort to go through almost all the reports, including the parts on those people’s pet subjects—agriculture, the budget, fisheries and so on. Does my noble friend agree that they did not contribute a shred of evidence on the issues that they continue to go on about in this House and outside?
Lord Wallace of Saltaire
That is exactly the point. We have heard the noble Lord, Lord Pearson of Rannoch, being, it seems to me, cavalier with the evidence on many occasions in this House in recent years. I am sorry that he is not here, but I am not entirely surprised that he is not prepared to stand up and argue the evidence carefully with others when a lot of careful evidence is in place.
Following the slightly partisan speech by the noble Baroness, Lady Morgan, I can tell her that one of my roles as this process went on was to keep the Labour leadership informed of what we were doing and encourage them to engage. I have to say that most of my interlocutors in the Labour Party were hiding in the long grass themselves. I welcome the Labour Party’s final commitment to the importance of staying in the European Union. It has been a certain time coming over the past three years, but it is very good that the Labour position is now clear. We look forward to the Labour Party spelling out its approach in rather more detail.
This exercise provides the basis for a reform agenda. We have the contributions of a wide range of businesses and business organisations, academics and various other bodies. It was interesting to me that the most negative evidence from business came from small business associations few of whose members export—those who therefore, obviously, have the least interest in the European single market. Some seem to have the impression that if we got rid of European regulation we would have no regulation at all, without understanding that we would then need to have national regulation, or to accept other international frameworks for regulation.
We have all learned a great deal from this process. Of the consistent themes that have come out of it, the first was the idea that although we talk about completing the single market, we shall never do that, because the single market changes as we go along. We did not have to worry about a digital single market 20 years ago, whereas now it is one of the central issues with which we are concerned. As new technologies and new services develop, clearly we must continue to move on.
Secondly, the European Union is not just the international body to which we belong and do not want to belong to, it is embedded in an intricate network of international organisations such as the OECD, the Bank for International Settlements and the World Health Organization, of which the European Union is almost a regional organisation. If Britain were to leave the European Union, that network of international organisations would still constrain us. Globalisation means that Britain has to pool a great deal of its sovereignty, and the European Union provides a very good way of sharing that within a relatively transparent and friendly network.
We also discovered—this was a common theme across many of the reports—that the Commission has often been much too enthusiastic in proposing legislation without being sufficiently concerned about its impact, implementation or enforcement. I am happy to say that that is beginning to change. I hope that we have contributed to that. Impact assessments are the flavour of the year in Brussels, both in the European Parliament and the Commission, and Frans Timmermans and others are very clear that the Commission should be careful about the weight of the new proposals it puts through.
Another common theme concerned the tendency of the Court of Justice of the European Union to support integrationist cases and to pay insufficient attention to subsidiarity and proportionality. I think that is also changing, although I may say that, of the 32 reports, the report on subsidiarity and proportionality is, I suspect, the most widely read in other countries as this is a key topic which many of us do not fully understand the European Union has to take fully on board.
The reports stand by themselves. We did not intend to have policy conclusions; they are to be dug out to inform the debate and to make sure that those who deny the situation as we have found it are properly corrected in debate. We found that the review feeds into the domestic debate, but it is bounded by time. In two or three years’ time, attitudes will be different because the policy priorities will be different. Therefore, I am not sure that we necessarily want to embed all this in stone. However, we hope that it provides a basis for what may or may not be a referendum debate in 2017.
One report—the fisheries report—provided an alternative model that might be used on competence, involving European regulation or less European regulation. Perhaps we might have tried that out in one or two other reports, but the evidence that came in did not support it.
I think that the least anticipated outcome of the review was the rising level of interest and engagement across other member states. It has been very impressive. For example, I am told that the French department of transport is now using the transport report and that it is one of the things new recruits read. There are a whole set of discussions. On various occasions I was detailed to phone Ministers in other Governments and was happily surprised to discover that senior Ministers in other Governments had at least read the summaries of the reports. There have been contributions from a number of other Governments. The French parliament’s Senate committee is now conducting its own review. I could go on at length about how many other Governments have drawn lessons from what they see as a particularly valuable and detailed review of the current state of competences, which feeds into the British Government’s reform agenda.
I stress that the reform agenda is a continuing process. Reform is not something that you start and then finish. As we have operated over the last three years, the fisheries regime has been changed quite substantially. The budget has continued to change in emphasis, with more going to scientific research and less going to agriculture. We are in no doubt that we will continue to press that reform agenda.
The Foreign Secretary has so far visited 24 of the other 27 capitals and he is discussing the UK’s reform ideas and finding a lot of like-minded Governments who have similar approaches to strengthening the role of national Parliaments, making sure that new regulations are entirely justified and investigating the subsidiarity and proportionality issues. They ask: do we need to do this at the European level or can we leave sufficient flexibility at the national level? This has fed into the British debate, the wider European debate and the Commission’s agenda in terms of the need for better consultation, more attention to impact assessment and all of that area.
I am clear that this has been an extremely valuable exercise. I will say in passing to the noble Earl, Lord Dundee, that the relationship between the European Union and the Council of Europe is a matter for another time. The Council of Europe, which includes Russia, is not at the moment in the easiest state to deal with peacekeeping issues and other such matters. The EU itself, for security reasons, is becoming even more valuable for the UK than before.
What we have done, over the last year and more, as these reports have been absorbed in other national capitals, is to make progress on our continuing reform agenda. We look forward to doing that, whoever becomes the next Government—whichever parties form the next Government. I have said to some of my Conservative friends that I expect we might have to be a caretaker Government for some time in May, while the Conservatives and the SNP negotiate.
There is a basis here for an intelligent discussion. We have made an impression, not only on the debate here, on the readiness of Whitehall and on the willingness and expertise of the various business associations that have fed in, but we have also affected the debate in Brussels and around the European Union. That seems to me to be a great success and worth doing in itself. I am very glad that the European Affairs Committee will take this on from here.