Scotland Bill
Jacob Rees-Mogg Excerpts(9 years, 4 months ago)
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Mr Jones
I agree, but if air passenger duty were zero in Scotland and the same as it is now in Newcastle, Scotland would clearly have an advantage. I do not want to get on to how much Scotland is able to devote to its tourism promotion budget, something that we need more of in the north-east.
Mr Jacob Rees-Mogg (North East Somerset) (Con)
The hon. Gentleman seems to be setting out the most attractive form of tax competition. If Scotland gets rid of air passenger duty, there will be real pressure on the Chancellor to abolish it for the rest of the United Kingdom, and the whole economy will grow. It is marvellous to see the whole House moving in such a right-wing direction in its economic debates.
Mr Jones
On this very rare occasion, I agree with the hon. Gentleman. I would abolish APD altogether; it is a tax that, as the Scottish Government have recognised, stifles economic development. A PwC report says that the number of overseas visitors would grow by 7% if we abolished it altogether and that more money would come in from other taxes.
Scotland, for her own, sensible reasons, could halve and then abolish APD, leaving Newcastle at a great disadvantage. That would cost jobs; it has been anticipated that up to 1,000 jobs could be lost by 2025 if the situation remained the same, along with £400 million gross value to the economy of the north-east. One of the poorest regions in the UK cannot afford to be at such a disadvantage.
As my hon. Friend the Member for Blackley and Broughton (Graham Stringer) said, there seems to be a bit of confusion over the Government’s approach. He read out the Chancellor’s comment at the Treasury Committee sitting. The Chancellor seemed to be sanguine, giving the impression that if Scotland reduced its APD, airports such as Newcastle could happily soak up a 10% loss in traffic. I am sorry, but I have been a director of the airport and I know the management team well—I know how hard they have to work to attract every single flight and new route to Newcastle. A clear 10% loss would not be acceptable. My hon. Friend mentioned another point. The Chancellor also said that his personal view was that tax competition should be allowable. If that means putting the north-east at a disadvantage, the Government have to address that.
There has been some confusion. During the general election, the Prime Minister was asked by a local newspaper about unfair competition affecting Newcastle airport and—we should not forget the other airport in the north-east —Durham Tees Valley airport. He was questioned about reducing rates of APD for north-east airports to match the reduction in Scotland, as the Labour party in the region had been arguing. He said that that could be a positive suggestion.
What we need now is clear action. We have a new Minister for the northern powerhouse, the Under-Secretary of State for Communities and Local Government, the hon. Member for Stockton South (James Wharton). I understand that his constituency includes Durham Tees Valley, so whether he can persuade the Treasury to do something about the effect of the clause on the north-east economy will be an interesting test of his power. We hear a lot about the northern powerhouse. Those of us in the north-east think that it ends in Manchester.
It is important that the effect of the clause is addressed. If it is not, this unfair tax will not only cost jobs in one of the poorest regions of the UK, but stifle one of the few economic drivers in the north-east in Newcastle airport, which can grow not only business, but competition. As I said in an earlier intervention, Newcastle airport is important not only for passengers, but for cargo revenues. It enables companies in the north-east to export around the world. The direct flight to Dubai has meant that a lot of local businesses have been able to export products there directly and to grow.
I am interested to know the Government’s approach to this issue. If the clause is passed, we cannot have a lag that leaves regions such as the north-east being hit by the tax competition which the Chancellor seems to think is acceptable, but which the Prime Minister clearly wants to do something about. The ball is firmly in the Government’s court to ensure that this anomaly is put right.
European Union (Finance) Bill
Jacob Rees-Mogg Excerpts(9 years, 5 months ago)
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Barbara Keeley
Indeed we could. Let me go on and make a few more points about the proportion that is allocated to that very important priority of competitiveness for jobs and growth. In 2014, only around €15 billion will be spent by the EU on that budget priority compared with over €41 billion for market-related spending and direct payments for agriculture. There is no sense in a system that takes that vital priority—vital for every part of the EU—of competitiveness for jobs and growth and spends so little on it. Out of the €6.3 billion of European Union funding allocated to the UK in 2013, only 23% was spending on jobs and growth compared with 63% on agriculture. It is the balance that we are calling into account.
As my hon. Friend the Member for Luton North said on Second Reading, although the proportion of the budget for agriculture has been falling, there has been a fairly significant increase in money terms over the past eight years. As long as this balance seems wrong to people, it will be very hard for many of us to explain on the doorstep why we are spending only 23% of European Union funding in the UK on jobs and growth but 63% on agriculture. Some hon. Members might find such an explanation easier in their constituencies than others, but it is a difficult argument.
Mr Jacob Rees-Mogg (North East Somerset) (Con)
I am very sympathetic to what the hon. Lady is saying. My one concern would be that if there are reforms, they do not disadvantage some farmers in North East Somerset and other rural constituencies to favour spending on the continent. Reform is quite right, but it needs to be fair for the United Kingdom’s farmers.
Barbara Keeley
The more reviews that we carry out of those priorities, the more that we develop our understanding of where the money is going. Earlier, the hon. Member for Boston and Skegness (Matt Warman) called for these matters to be discussed in a language that his constituents could understand, and I do not think that they are discussed in such a way. Having ploughed through very many debates and very many documents in relation to the Bill, I do not think that those matters are understood. The hon. Gentleman is quite right.
The Economic Secretary to the Treasury said she accepted that expenditure on the CAP is
“still too high both in absolute terms and as a proportion of the overall budget.”—[Official Report, 11 June 2015; Vol. 596, c. 1426.]
If that is what the Treasury team currently feel—that it is still too high, both in absolute terms and as a proportion of the overall budget—what are we doing to understand that better, to review it and to change it?
It is my assertion that previous reviews have not led to the level of reform that we want to achieve. It was our purpose in tabling new clause 2 to keep focus on that vital issue. When most member states are finding it necessary to make very difficult decisions—clearly, we are in that position ourselves—about their own budgets and spending, the European Union must ensure that expenditure is efficient and focused on addressing the major concerns that member states face. As my hon. Friend the Member for Nottingham East (Chris Leslie) said in the October 2012 debate:
“The next seven years of the EU budget should prioritise jobs, growth, infrastructure and practical programmes that rejuvenate fragile economies.”
As I mentioned on Second Reading, this is much needed when we still have 735,000 16 to 24-year-olds in the UK looking for work. That should be our focus—those young people.
We need a better balance of funding and we need the European Union to provide a better framework and strategy to achieve growth and jobs. Looking deeper into the detail, and the spending commitment to the EU’s smart and inclusive growth priority, only a quarter of that is spent on competitiveness for jobs and growth, and three quarters on the EU’s cohesion policies, including structural funds. It probably is not appropriate today to open up further debate about the use of structural funds. That is often discussed when we are discussing EU finance, but as my hon. Friend also said:
“Savings can be made on aspects of EU structural funds that…are too often committed in a haphazard manner and depend on outdated commitments rather than future priorities. Unless structural funds contribute to positive economic development, they cannot be justified.”—[Official Report, 31 October 2012; Vol. 552, c. 304.]
The Opposition say strongly that the proportion of the EU’s smart and inclusive growth expenditure that goes towards securing competitiveness for jobs and growth is too small. That important area of spending accounts for around a quarter of the EU budget in 2014, but that rises to only 27% across the whole six-year period.
Alex Salmond
One of the reasons we do so incredibly badly in many European programmes as regards funding is that the Treasury’s interest, when looking at additionality, as it calls it, is always to minimise EU expenditure. Although it is perfectly acceptable for the Government to defend the rebate, it is less acceptable to look at every European programme and try to minimise expenditure on it, because in doing so, we lose some of the alternative opportunities that the hon. Member for Worsley and Eccles South talked about. If the Treasury looks at every European programme and says, “How do we minimise spending?”, what follows as a natural consequence is that our share of that spending is also diminished. In the case of the common agricultural policy, it is possible to make a direct connection with the negotiating stance of the right hon. Member for North Shropshire, who was trying to abolish farm payments altogether and got the miserable, unfair and inequitable distribution of support that has been the end result of the CAP negotiations.
The Minister—I am not sure if it was a dead bat, a glorious drive through covers, or a catch at slips—rather evaded the direct question of what is the Prime Minister’s negotiating stance on the budget. The Minister said, after being passed a note, that the Prime Minister’s stance was to cut the whole budget and to protect the UK rebate. Let me point out that that has been the Government’s stance and policy since they took office in 2010; it is not a particular stance for these renegotiations. What the Minister is being asked—we really would like an answer—is whether the Prime Minister has a specific target in mind in renegotiations for changes in the EU budget or the UK contribution to it, and if so, what it is. Failure to answer that question throughout the debate adds to the no doubt unworthy, but considerable, suspicion shared across this Chamber that the Prime Minister is adopting this nebulous approach to what are his negotiating aims so that whatever he comes back with can be announced as a fundamental achievement. That does not stand scrutiny in this Committee, but even more importantly, it is a particularly poor campaigning argument in favour of the European cause.
I hope that the Minister—the last man in—will rise to the occasion by confirming that he is in favour of more equitable distribution of land ownership in Scotland and by giving us an insight into the Prime Minister’s true negotiating hand in the coming arguments and discussions in the European Union.
Mr Rees-Mogg
The speech by the right hon. Member for Gordon (Alex Salmond) is tremendously important and gets to the heart of one of the issues we have with the common agricultural policy, although, not surprisingly, I look at it in a different way from the question of socialism and land holdings that the SNP is going for.
The issue, as has been discussed in the European Scrutiny Committee, is that over the years our farmers have increasingly become so efficient and large that there has been a good deal of consolidation. That applies very much in my constituency among dairy farmers. The number of dairy farms has reduced significantly and they are bigger farms proportionately, but European subsidies tend to go to smaller farms disproportionately. Therefore, we find that British farmers are disadvantaged. I entirely agree with the right hon. Gentleman that if, under a system of farming subsidies and a competitive framework, that means that people are getting handouts from the European Union, British farmers—farmers in the United Kingdom—do not get the equivalent subsidies to farmers on the continent, they are disadvantaged because their cost base is automatically higher and their profitability is reduced. Therefore, when we are arguing for careful consideration, overview and oversight of expenditure in the European Union, and reductions in the common agricultural policy, we have to ensure that the cuts are made in a way that is fair to the UK farmer. Even if our end objective is the entire elimination of agricultural subsidies, it must be done in a way—
Jim Shannon
As I am sure the hon. Gentleman is well aware, the farms in Northern Ireland are smaller. They are greater today than they were, say, 20 years ago, but they are still not big in comparison with those on the UK mainland. Does he agree that there needs to be consideration for the farms in Northern Ireland, particularly in my constituency of Strangford? He seems to be referring to farms that are very large. In Northern Ireland, we have farms with an average of 150 acres.
Mr Rees-Mogg
I am very sympathetic to farmers and I ought to declare an interest as I have a little land in Somerset, although sadly not a great deal and I do not farm directly. If I did, I would certainly count as a very, very small farmer. In the past a slice has been taken from the biggest receivers of European subsidies, so the farms that have been the most consolidated and efficient lose subsidies at a faster rate than other farms. I think that protection is already in place—
Alex Salmond
That is why the protection built into the agricultural settlement of €196 per hectare is so important, and why it is so disadvantageous that it is almost half that figure in Scotland. That is why the minimum per hectare is so important.
Mr Rees-Mogg
Being more traditional, I prefer a minimum per acre, but otherwise I am broadly in agreement with the right hon. Gentleman. I agree that it is not right to look at the issue purely in terms of the landowner, because that discourages consolidation. As Conservatives, we are in favour of efficiency in all industries, but the subsidy system across Europe not only disadvantages our farmers, but discourages consolidation and efficiency. That cannot be the right approach.
Peter Grant
Is the hon. Gentleman telling us that consolidation and enlargement always equal efficiency? Does he not recognise that, especially in agriculture, there are significant community and social benefits to allowing small, family owned farms to continue in existence?
Mr Rees-Mogg
There are great advantages to having small, family owned farms, but we need an efficient agricultural system that provides the food and produce the country needs. I do not think one should be unduly sentimental for agriculture against other industries. As a lover of the countryside and of our rural traditions, I am tempted to fall in line with the hon. Member for Glenrothes (Peter Grant). The constituency was called Central Fife when I stood there—unsuccessfully, just for the record. However, although I am sympathetic to his point, I think it is important to have efficient agriculture first when spending other hard-pressed taxpayers’ money. It ought not to be entirely about sentimentality.
Kelvin Hopkins
It is a great pleasure to follow the hon. Member for North East Somerset (Mr Rees-Mogg). Before I turn to the main part of the my speech, I would like to comment on what he has just said. Some 34 years ago, my then 11-year-old son had a discussion at his primary school about what was then called the Common Market. He was asked about the common agricultural policy, which he knew a lot about because he listened to me at home. His teacher asked him, “What is the CAP?” He said, “It’s the common agricultural policy.” His teacher asked, “What is that about, then, Daniel?” He said, “It’s a way of subsidising inefficient small farms,” and 34 years on, the hon. Gentleman has raised exactly the same point. Some things do not change very much. I think my son is the same age as the hon. Gentleman.
It is also a great pleasure to follow my hon. Friend the Member for Worsley and Eccles South (Barbara Keeley), who sits on the Front Bench, and support two of her new clauses and her amendment. On new clause 3, I am pleased that she has acceded to the sensible point made by the hon. Member for Stone (Sir William Cash), the Chair of the European Scrutiny Committee, of which I am also a member. I will, however, support my hon. Friend in the Lobby later on her other new clauses.
I have spoken probably 100 times in European debates in this Chamber over the past 18 years. I have said some of what I am going to say today a number of times before, but in order to make an effect in politics I think we must sometimes repeat messages over and over again, hoping that, in time, one’s colleagues, particularly those on the Front Bench, will listen, agree, take note and act accordingly.
I was also much taken by the hon. Gentleman’s comment that when he rebelled he was trying to help his Front-Bench colleagues. That is a splendid idea. If ever I am moved to rebel in future, I shall tell my Whip that I am trying to help our Front-Bench colleagues and I hope she will accept it in that spirit.
The most interesting new clause is new clause 2, which is about expenditure. I have said many times that I believe that the common agricultural policy ought to be repatriated to member states for them to decide how to subsidise their own agriculture, and that the CAP’s structures should be dismantled. We would certainly benefit from that financially in more than one way, including by not paying in so much. We could subsidise at exactly the same level and possibly in exactly the same way, but still be better off because we would not be paying into something where we are net losers.
European Union Referendum Bill
Jacob Rees-Mogg Excerpts(9 years, 5 months ago)
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Mr Clarke
Let me make a little more progress. I hope that my hon. Friend’s constraint will stop him leaping up too frequently; I will give way in due course.
I do not believe that there is any bad faith anywhere. Everyone wants those who campaign and the public to feel that the referendum has been conducted with absolute fairness. I am surprised, therefore, that, in these opening days of the European referendum process, so much passion is being excited by procedural issues. I will not describe them as footnotes, but, although they are important, none of them will make the faintest difference to the result on the day of the referendum. If we asked most of our masters—the public—whether purdah was followed properly during the campaign, they would not have the first idea what we were talking about. So my first plea is for a sense of proportion.
My plea to my right hon. Friend the Minister—I do not think I need to make it because I have seen the letter, which did not get to me either; I have just been shown it—is to live up to his undertakings. It is right to bend over backwards to reassure my right hon. and hon. Friends that there is no conspiracy, that they must not leap into paranoia, and that the intention is to hold a referendum in which the British public will be able to reach a view on balanced presentations. It seems to me that Ministers have started doing this straight away. I got the impression from the Second Reading debate that my right hon. Friends on the Front Bench were as surprised as I was at the sudden excitement about the rules in what should have been a fairly routine Bill paving the way for the referendum.
Mr Jacob Rees-Mogg (North East Somerset) (Con)
Will my right hon. and learned Friend give way?
Mr Clarke
I will give way in a moment.
The Prime Minister has announced that he will suspend the rules of collective responsibility and that members of the Government will be able to campaign on whichever side they choose. We now have the letter giving an undertaking that the Government will depart from section 129. People seem to think that there is something magic about 5 May 2016, so we will not hold the referendum on that date. I have sympathy with Ministers; they are being derided. The moment they make concessions to all these impassioned pleas, they suffer the fate of all Ministers and are immediately accused of a humiliating U-turn and held up for ridicule.
Some of my right hon. and hon. Friends and perhaps others in the Scottish National party are difficult to calm down and reassure. I ask them to accept, as I accept, that every effort is being and should be made to satisfy fears about the propriety of the campaigning period.
Mr Lidington
My hon. Friend is obviously free to take legal opinion of his own, but if he looks again at the wording of section 125 and applies it to the conduct of EU business, he will find that there would be very serious problems in carrying out day-to-day business in the national interest at EU level if the section is left untouched.
We believe that applying the section would be inappropriate because the referendum is taking place as the result of a clear manifesto commitment to negotiate the terms of the UK’s relationship with the European Union and to put them to people in a referendum. Section 125 could make it impossible to explain to the public what the outcome of the renegotiation was and what the Government’s view of that result was.
The Government must be able, and legitimately should be able, to offer their views, including up to the day of the referendum. However, as I have said, the Government are not a campaign: it is not the Government’s job to supplant the role of the lead campaign organisations during the referendum campaign, and it is certainly not our intention to act in that way. We recognise and understand the strength of feeling that exists on this issue, and I am grateful for the constructive and courteous tone in which the debate has been conducted both this afternoon and in private conversations outside the Chamber.
Mr Rees-Mogg
My right hon. Friend said that the Government may not be able to give their view on the outcomes of the renegotiation. Surely that cannot be true. It cannot be the case that the renegotiation will only be finished within the purdah period.
Mr Lidington
What I am saying is that the Government will need to be able to say why they have come to the conclusion and recommendation that they have reached.
As the Foreign Secretary said and as I repeated on Second Reading last week, the Government will exercise restraint during that period. We have listened to what colleagues in all parts of the House have said and are therefore committing ourselves to table amendments on Report to write into the Bill measures that will provide reassurance on that point. I accept completely the point made by my hon. Friend the Member for North East Somerset (Mr Rees-Mogg) and my right hon. and learned Friend the Member for Rushcliffe (Mr Clarke) that it is vital that the British public and both sides in the referendum debate accept that the referendum is being conducted fairly and therefore feel able to accept the result.
Mr Rees-Mogg
I am extremely grateful to the right hon. Gentleman for giving way. I find myself in a surprising degree of agreement with what he is saying, but there is a chance that the sinner repenteth, because similar amendments may come forth on Report.
Alex Salmond
As I understand it, and I am open to correction from Sir Roger, the sinner may get a chance to repent even before that. Amendment 11 has still to be called in our proceedings, so the sinner may get a chance to repent on Report, at the eleventh hour or at 7 o’clock this evening. Let us all hope that the sinner does repent whenever they choose to.
Sir Gerald Howarth
That is a very civilised remark from a very civilised Member, who together with me champions the cause of the sixth-form colleges. He and I have the finest sixth-form colleges in the country. Mine is slightly better than his, but there we go.
This debate in Committee is important. If we do not refine the detail in every possible manner, compatible with what my right hon. Friends on the Front Bench know has to be done in order to comply with the law and so on, we have Report stage, when things can be sorted out. However, it must be made crystal clear that we will not have the European Commission interfering in that referendum in the United Kingdom in any shape or form. Amendment 10 gives us the vehicle to send the clearest possible message to Brussels that that is something up with which we will not put.
Mr Rees-Mogg
It is a pleasure to serve under your chairmanship in today’s debate, Mr Howarth, and to welcome the Parliamentary Secretary, Cabinet Office, my hon. Friend the Member for Weston-super-Mare (John Penrose), as the Minister responding. The constitution is always in safe hands when it is in the hands of Somerset, so it is reassuring that he is here to respond.
I want to follow on from what my hon. Friend the Member for Aldershot (Sir Gerald Howarth) said about amendment 10, on EU funding, which was tabled by my hon. Friend the Member for Stone (Sir William Cash), and to which I have added my name. The appearance of fairness within the referendum is at the heart of what the Government must try to do. The Government, like Caesar’s wife, must be above suspicion. It would be wrong if there was any feeling that the referendum was being held improperly, that undue pressure was being brought to bear, or that funding was directed to one side rather than the other—I say that as somebody who supports the Government’s position—but it would be most wrong if British taxpayers’ money funnelled by the European Union ended up being used to campaign for us to remain subject to the European Union.
Mr Rees-Mogg
It is a delight to give way to the hon. Member for Na h-Eileanan an Iar (Mr MacNeil).
Mr MacNeil
The hon. Gentleman’s pronunciation is as impeccable in this Parliament as it was in the last one. I congratulate him once again.
The hon. Gentleman mentions the nonsense and unacceptability of British taxpayers’ money going through the European Union and back again. He will be aware, and perhaps bemused and baffled, that there is much amusement in Scotland that Scottish taxpayers’ money funnelled through the UK Government was used in our referendum to campaign succinctly and definitely on one side. I am thinking of Sir Nicholas Macpherson and many others along with him.
Mr Rees-Mogg
The hon. Gentleman had the opportunity to listen to an excellent debate on that very subject yesterday, led by my hon. Friend the Member for Gainsborough (Sir Edward Leigh), but I think I would be in trouble if I went through the question of full fiscal autonomy for Scotland in relation to amendment 10 to the European Union Referendum Bill, so I want to stick to the subject at hand.
The European Union has a budget for this. Indeed, we passed a Bill in 2013 that allows for the European Union to engage in political activity and the promotion of the cause and objectives of the European Union. That money flows to institutions within the United Kingdom and that money comes with strings attached. It is money that is given on the basis that the institutions receiving that money support the objectives of the European Union.
Mr Rees-Mogg
My hon. Friend is absolutely right. It would be against the conditions of receipt of that money to use the money to campaign for a member state to leave the European Union.
Some very influential bodies in this country receive money from the European Union. My hon. Friend the Member for Harwich and North Essex (Mr Jenkin) said that the CBI receives money from the European Union. We know that the CBI is in part funded by Europe. It is therefore under an obligation either to return that money or to support the objectives of the European Union. When the director-general of the BBC came before the European Scrutiny Committee, he was asked about the money the BBC received from the European Union and the strings that that may have attached. Even the most impartial and highly regarded bodies in our establishment receive money from the European Union, and they take on certain obligations in return.
My hon. Friend the Member for Sherwood (Mark Spencer) made a very good point about what happens to farmers in receipt of subsidies that have come from the European Union. Are they then prohibited from giving money to the Conservative party to campaign in the referendum? No, of course not. He may well be right that the amendment needs improving to ensure that people are not captured by mistake.
Jim Shannon (Strangford) (DUP)
The hon. Gentleman refers to farmers and their obligations. Is he aware that the National Farmers Union in the UK is suggesting to its members that they should stay in the European Union and is asking them to vote accordingly? Does he have concerns, as I do, about that?
Mr Rees-Mogg
I do indeed. I have no idea whether the NFU receives any money from the European Union. If it did, it would be under an obligation to support the objectives of the European Union.
It is a very insidious aspect of how the EU operates. It is why it likes to put its stars up everywhere: to show us what wonderful things Mother Europe is doing to help us and enforcing compliance with its view of the world. We want to make sure that our referendum is held absolutely fairly, without that influence. In terms of that fairness, I want to come on to the debate on schedule 1 stand part. It is schedule 15, referred to in schedule 1 to this Bill, that comes to the issue of section 125, the exemption from which removes the whole purdah question for the Government.
I have every confidence that the Prime Minister will lead the no campaign. He will come back and say that what is in the interests of this country, if the renegotiation is not exceptional, is that we leave. He has indicated that in speeches and I admire him for making his views so clear. When he does that, I do not want him to be helped by legerdemain. I do not want the no campaign to benefit from the Government being able to use all their resources to get me what I am likely to want in those circumstances. The right hon. Member for Gordon (Alex Salmond) expects the reverse. He thinks, I happen to think naively, that the Government will come back and wish to campaign for a yes vote. He likewise does not wish to see them being able to use all the powers at the disposal of the Government to push for what they want.
Those powers are considerable. The ability of the arms of central and local government to influence the media and public opinion and to use its PR resources, press officers and administrative and logistical machinery to help one side or the other is considerable. Whichever side of the argument one falls on, it must be right to hope that the referendum will be more than just a staging post in the discussion about Europe, and that it will help put our relationship with Europe on a firm footing that can last for decades rather than weeks. We do not want anyone on either side feeling that the result was so flawed, because of how it was carried out, that we need another referendum.
Stephen Gethins
The hon. Gentleman makes a valid point about putting us on a basis for years to come, rather than months or weeks. In that regard, does he think the Prime Minister should be pushing for co-operation with Europe in more areas, rather than fewer?
Mr Rees-Mogg
No, we co-operate in far too many areas already. I have a lot of sympathy with the SNP’s position in many ways, because it is not entirely different from mine. I want my country, which I view as the UK, to govern herself, and SNP Members want a smaller part of the UK—Scotland, which they view as their country —to govern herself too. It puzzles me that, having got self-government, they want to hand it over to Brussels, but that is a question for them.
Mr MacNeil
My first quibble—the first mistake the hon. Gentleman has made—is that the British Union is not a country, but a union. Secondly, he fails to realise that we only want to change our relationship with London. Our relationship with Brussels would stay the same, under the SNP’s proposals for Scottish independence, which might come very soon.
Mr Rees-Mogg
That is a moot point that was discussed at length during the Scottish referendum campaign and to which I had better not revert.
I want to concentrate on the power, influence and resources of Governments.
Mark Spencer
I acknowledge my hon. Friend’s cynicism about the Government taking a view one way or another, but does he accept that the Government could express their view neutrally and thereby help to inform the electorate? It is vital that the electorate are informed and can make a decision based on informed opinion, and surely the Government could have a role in making sure that the Great British public are fully informed in both directions.
Mr Rees-Mogg
No, I am afraid that I fundamentally disagree with my hon. Friend. There are stages in this process. That is what the Bill and the Minister’s letter are trying to get at. The Government will have their renegotiation and then come back with a package saying it is a triumph, whatever is in the package. It might have three loaves and two fishes, or it might give us complete control of our own destiny—whichever it is, the Government will say it is a triumph. That will be the Government’s answer, and they can tell the electorate what they have managed to do. From then on, however, it will become a matter of straightforward politics whether someone believes the Government and agrees with what they have done. I approve of the adversarial system in this country. We do not develop our arguments and get to the answer we want by getting authoritative documents from the Government. Actually, such documents always contain a bias. It might not be obvious on first reading, but, reading through the detail, one will see the way the Government want people to go, and that will bolster the position they have set for themselves.
Sir William Cash
I might be corrected by SNP Members, but, as I understand it, the Electoral Commission put out leaflets during the Scottish referendum campaign agreed between the yes and no campaigns. Even if that did not happen, it might be a way of dealing with the situation. The no and yes campaigns could exchange information and come up with a bottom line, and then that line could be taken and put as a fair choice.
Mr Rees-Mogg
I certainly see no impropriety in that. In the London mayoral campaigns, the views of all the candidates are circulated in a single booklet. That is not improper. Perhaps, however, I am more of a believer in capitalism, in respect of elections as well as the economic structures of the country. I believe that people should campaign for what they want, and should put their own arguments rather than thinking that they could be better put—or even well put—by a nominally independent third party, least of all the Government.
Mrs Main
The stakes are very high. If a Government have nailed their colours to a mast when it comes to a particular vote—in or out—and that vote does not go their way, a Government will then be in power for two or three years with a vote that they do not wish to live with, because it was contrary to the colours that they nailed to the mast.
Mr Rees-Mogg
That is a very important point, which may be worth discussing when we debate other amendments. Ultimately, the Government must accept the will of the people—that is what we all believe in, and that is why we are all here—but they must deal with that fairly.
There is also the question of where the Government should proceed from here. There seems to be a wide consensus that paragraph 15 of schedule 1 is deeply unsatisfactory, and that the removal of the issue of purdah was simply a mistake. I am willing to trust the Government, so I accept that it was an honest mistake, and not a mistake that was made in an attempt to fiddle the referendum result. I believe that partly because I am a simple fellow who is very trusting of the Government, but also because trying to fiddle the result will damage whichever side wishes to do it.
The British electorate will not have the wool pulled over their eyes. If little bits of legislation are squirreled away into the Bill to make things easier for one side or the other, those of us who are on the other side will campaign on that basis. We will say, “Look, we need to act against this, because people are trying to fiddle us over what is happening.” There is a wonderfully contrary spirit among the British people, who will not be cowed by those who try to trick them.
Sir William Cash
The explanatory notes relating to section 125 of the 2000 Act were so explanatory that a line and a half said simply, “This is what we are going to do.” For practical purposes, I do not think that my hon. Friend would be entirely right in thinking that the Government got there by mistake, particularly as they had taken counsel’s opinion, which we are determined to ferret out.
Mr Rees-Mogg
I do not know too much about ferreting, or indeed about counsel’s opinion, but my hon. Friend knows only too well that explanatory notes are anything but explanatory. They consist of a complicated a set of notes which, when read carefully in conjunction with a Bill, can shed some light, but I do not think that anyone expects them to be like the Book of Revelation, revealing everything that one could possibly want to know about a Bill. They require Members of Parliament to look diligently at what underlies them.
The Government must examine clause 3 very carefully. They have given undertakings to do so over the next few months, but they need to come back with something that is just as rigorous as what is there already.
Bob Stewart
Should there not be a clear gap between the offering that the Government have brought back to give to the people and the start of the campaign, which we may wish to call purdah? During the short campaign before the general election, which could be seen as a model, both sides—I am talking just about Labour and the Conservatives—suddenly started to produce new policies. We cannot have that; we want a clear offering followed by a gap, and then the start of the campaign. Does my hon. Friend agree?
Mr Rees-Mogg
I entirely agree with my hon. Friend and that point has been made by my hon. Friend the Member for Stone. An uncharacteristically weak argument must have been given to the Minister for Europe to read out—he could not have made so poor an argument himself—when he said that if the negotiations have finished it would be very difficult for the Government not to be able to explain them immediately before the election. It cannot be that we will have the referendum two weeks after the negotiations have been concluded. That would be preposterous. There has to be a considerable period of time beforehand, so that what has happened can be understood, debated and campaigned upon. That must mean a period of a minimum of 28 days, as currently set out, but realistically we are going to need three months at the end of the negotiations before we can move straight to the referendum.
Sir William Cash
My hon. Friend is developing an excellent argument, which perhaps brings out the fact that the amendment I have tabled specifies, fully supported by the Electoral Commission, at least a 16-week referendum period, and then it describes how it should be conducted.
Mr Rees-Mogg
I am well aware of my hon. Friend’s amendment, and I think the Government need to be thinking along those lines. I am going to support the Government this evening; I am not going to vote with my friends in the SNP on this occasion, or indeed with my hon. Friend the Member for Stone, which is more of a break with the habits of a lifetime. There is an important “but”, and I think other hon. Members on the Government Benches share my view: because the Government have made a mistake at this stage, they now need to come back with something better than we would have needed had they not made this mistake. Therefore, the Government’s position of purdah must be a stricter one than they might have been able to get away with had they simply amended the existing restrictions rather than taking them all away and having a completely clean base from which they could have done anything.
Mark Spencer
Surely my hon. Friend will recognise that in the period before the referendum our relationship with the EU will still be fluid and there may be matters that need the attention of the Government and that could be crucial to an industry or sector of the economy. If he goes down the route of this period of purdah, the Prime Minister might not be able to do a deal or make an announcement on something of fundamental importance to the economy during that period.
Mr Rees-Mogg
I was making a slightly different point. I was saying that it is going to need to be tougher than the Government would have got away with had they come through with a limited change at an earlier stage. The Government said they would scrap the whole of section 125, and there is now suspicion that there was an ulterior motive for that. To allay that suspicion, the Government have to be very specific about the exemptions they want. It might be an exemption to vote in the Council of Ministers, and that would not be unreasonable, but would I give them an exemption to announce from the hilltops that they had lots of money from the EU to build a new factory in a key swing area of the country? No, I would not; I would think that would be about fiddling the result, if they wanted a yes.
Sir Edward Leigh
A lot of nonsense is talked about restricting the Prime Minister in what he can say. I do not remember the Prime Minister being particularly reticent during the general election campaign, and there is no reason why he would need to be reticent during this referendum campaign. If he is leading the no campaign, or more likely the yes campaign, of course he can say exactly what he wants. All we are arguing is that the machinery of government should not be used. We do that perfectly well during general election campaigns, and we know the difference.
Mr Rees-Mogg
My hon. Friend is right and will no doubt recall the 1970 general election when Harold Wilson, as Prime Minister, was not allowed to reveal the trade figures that came out immediately after the general election even though he knew them and they would have been very helpful to him. So there have been cases in which Prime Ministers were prohibited from making announcements on the basis of purdah, and I think it would be quite right to follow them in the context of a European referendum.
It was pointed out earlier that the reason the Government are so worried about this is part of the problem—namely, that the EU is involved in so many aspects of our lives that what they are restricted from doing will be much broader than it would be for a normal referendum. That makes it all the more important that this purdah is strictly observed.
We are arguing about whether the situation in which our lives are organised by the EU should remain or whether we should do something different. If, in the month or six weeks before the referendum, popular announcements about the EU were made but unpopular ones were held back—or vice versa—that would be completely improper.
Dr Murrison
Does my hon. Friend agree that the Executive in this country and the one in Brussels are perfectly capable of restraining themselves for 28 days? Indeed, it happens every year. It is called August.
Mr Rees-Mogg
My hon. Friend is absolutely spot on. The activities of the European Commission come to a grinding halt for at least the whole of August. Perhaps that is the answer to another question—one that I was less exercised about—on the matter of the date. If we were to hold the referendum in the first week of September, the EU would have been shut down throughout August and there would be no great problem with purdah.
I urge the Government to come back with something pretty serious on this. They cannot get away with most of what they want; this needs to be a thorough purdah. I do not know whether they will do this today, but it is open to them—as a sign of goodwill and reassurance—not to proceed with the proposal that schedule 1 be the first schedule to the Bill. Instead, they could bring forward a new schedule to deal with this problem on Report. That would leave everyone content, and there would be no great opposition or need to press amendments.
European Union (Finance) Bill
Jacob Rees-Mogg Excerpts(9 years, 5 months ago)
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Mr Gauke
Part of the calculation of member states’ contributions is based on the size of their economy. That means that bigger economies pay more and smaller ones pay less. As an economy becomes relatively bigger, it makes a bigger contribution. That is the factual situation; that is how it works.
I referred earlier to the corrections and the small reductions in the contributions from Denmark and Austria. The UK has always supported the principle of budgetary corrections set out at the 1984 Fontainebleau European Council, which gave us our rebate. In the absence of any meaningful reform on the expenditure side of the budget, we believe that those member states that make disproportionately large net contributions to the budget in relation to their prosperity, such as the UK, should receive corrections.
Mr Jacob Rees-Mogg (North East Somerset) (Con)
Further to the point raised by my right hon. Friend the Member for Wokingham (John Redwood), will the Minister explain whether there has been any change as a result of the recalculation of gross national income as the European Union has moved from the European system of accounts known as ESA95 to the later ESA2010, which I believe includes more of the black market? Has that move had the effect of making our economy bigger?
Mr Gauke
That is not a matter that is related to the Bill. The own resources decision uses the same formula for this financial framework as it did for the previous one. The revisions to GNI to which my hon. Friend refers are a separate matter. The element relating to the hidden economy has on occasions been somewhat overstated in this debate, but yes, there was a correction of our GNI estimates and that did require an additional sum. He will be aware of how this Government negotiated to ensure that we did not have to pay that sum up front—we were given much more time—and that the rebate applied to it.
Mr Rees-Mogg
I would be grateful if the Minister could clarify that this own resources decision is based on ESA95, as the last one was, rather than on ESA2010, which has been adopted for other purposes.
Mr Gauke
The own resources decision—the ORD—contains an element that is based on GNI. There may be different ways of calculating the GNI as it is updated. This is not related to the Bill, however. The formula remains essentially the same, and the element that comes from GNI has not changed, although there may be changes to the way in which the GNI works. Indeed, there are changes on an annual basis, because there are revisions to the number.
This new ORD requires the approval of each member state, in accordance with their own constitutional requirements, before it can come into force. The Bill will therefore give UK approval to the Council decision. The passing of the Bill will be the final action necessary in delivering the deal secured by the Prime Minister in 2013. As a result of the deal, EU spending was cut in real terms and UK contributions are forecast to be lower in every year compared with the final year of the Government’s seven-year deal, by on average around £1.3 billion. In addition, our rebate, which is worth around £5 billion per year, is protected. This agreement is in our national interest. It represents a good deal for the taxpayer now and over the coming years.
I would like to draw the House’s attention to what the Prime Minister said in 2013. After the EU budget negotiations, he said:
“Working with allies, we took real steps towards reform in the European Union.”—[Official Report, 11 February 2013; Vol. 558, c. 571.]
Hon. Members will need no reminding that reforming the European Union is one of the key objectives of this Government. The Prime Minister has already had constructive talks with EU leaders on how best to address the UK’s concerns about how the EU is run. These concerns are not unique to the UK. Many in Europe agree with us that the EU is too uncompetitive, too democratically unaccountable and too inflexible to the concerns of citizens in its member states. They agree with us that reform is needed, and the Prime Minister, in turn, is confident that he can and will succeed in negotiating to reform the European Union and our relationship with it.
In February 2013, we saw the positive results of working with partners to achieve real change in Europe. We saw what can be done when we are tough, positive and determined in negotiations with our European partners. Our vision of an open, prosperous Europe can be achieved only on the back of financial discipline. That was the principle on which we negotiated in 2013, and that is a principle we will continue to apply. The agreement that will be implemented by the Bill will be good for Britain and good for Europe, too. I commend it to the House.
Chris Heaton-Harris
Excellent. If we are going back in history, I guess I should share with the hon. Lady the fact that from 1999 to 2009 I was not in this House, but in the European Parliament. I sat on the budget and budgetary control committees, watching Labour Members of Parliament and Labour Ministers at the time not particularly bothering at all about EU spending, so I am delighted with the change of heart, because there is a need for focus on this area.
I do not intend to speak for too long because I know that a number of hon. Members want to make their maiden speeches. Small though the Bill is, it is, however, important and it deserves to have a decent amount of scrutiny by the House, which I am pleased to see that it will receive. The sole purpose of the Bill is to approve and implement the EU’s own resources decision, setting into legislation how the EU budget is to be funded, including the EU rebate. That is a big deal for us, because we stick in a massive contribution to the European Union. The Office for Budget Responsibility’s March 2015 economic and fiscal outlook report gives the net contribution figures for our country to the European Union. I had a debate in the Tea Room with my right hon. Friend the Member for Wokingham (John Redwood), who thinks that the figures are downplayed slightly, but they are the ones that I have to hand at the moment.
The net contribution for 2013-14 from Great Britain to the European Union was £10.2 billion; for 2014-15 it was £9.2 billion; and for 2015-16 it was £9.9 billion. Those are significant sums of money.
Mr Rees-Mogg
I wonder whether my hon. Friend thinks it is right to use the net figure, or the gross figure after rebate, because with the net figure the spending that is netted off is spent according to the requirements of the European Union; it is not necessarily spent in the way that a British Government would wish to spend it.
Chris Heaton-Harris
My hon. Friend is completely right about that, so I thought I should also share with the House the gross contribution figures given by the Office for Budget Responsibility in its March 2015 economic and fiscal outlook report. The gross contribution figures were £14.1 billion for 2013-14, £14 billion for 2014-15 and £14 billion for 2015-16. We are talking about massively significant sums and this Bill therefore needs some scrutiny, because it is the one that tells us how the EU budget is funded.
Mr Jacob Rees-Mogg (North East Somerset) (Con)
It is a wonderful coincidence—a fortuitous concatenation of circumstances—that I am able to congratulate the hon. Member for Glenrothes (Peter Grant), because I stood as the Conservative candidate in Central Fife in 1997, and I know that what he says is true: it is a constituency of wonderful people. They were incredibly kind to me. As hon. Members may have noticed, I am quite English—I come from Somerset. They could not have been more kindly to a young Conservative who they were pretty sure had no chance of winning. When the hon. Gentleman was singing the virtues of his constituents, I know he spoke the truth.
I now know—I did not know before—that, when I enjoy a glass of Pimm’s during the course of the summer, which I hope to do on occasion, it was made in Glenrothes. It is a wonderful constituency and it has a brilliant representative. I just hope the hon. Gentleman becomes a Conservative one day—the only way we will get a Conservative in Glenrothes is if somebody crosses the Floor.
We have had a cornucopia of excellent maiden speeches today. Sticking with the Scottish National party theme, the hon. Member for East Lothian (George Kerevan) made his maiden speech from the Front Bench. I do not know who the last Opposition spokesman to do that was, but I know that the last Minister to do that was Harold Wilson, who made his maiden speech from the Dispatch Box in 1945. The hon. Gentleman is in very fine company, and made a very fine speech, with detailed points on the European Union, which I look forward to cross-examining closely in further debates.
The hon. Gentleman also revealed the extraordinary generosity of benefits in Scotland when he told us that he is eligible for a bus pass. Clearly, the age at which people get bus passes in Scotland is much lower than it is in the rest of the United Kingdom. I will not go on to the Barnett formula and how come bus passes for such relative youths are paid for.
It was a particular joy to hear my hon. Friend the Member for Tonbridge and Malling (Tom Tugendhat) make his maiden speech. He comes from a most distinguished parliamentary family—his uncle was the Member for the Cities of London and Westminster—but I am very reassured that he will claim the high ground for parliamentarians against paternal judges. Although paternalism is in many ways a very good thing, the supremacy of the House must be reasserted, even in the Tugendhat family.
I am delighted that my hon. Friend thinks he is going to test Hansard. He will soon come to know that there is no test he can set Hansard that they do not manage to pass with flying colours. However fast the bowling or however good the batting—to go back to the Tonbridge theme of M. C. Cowdrey—Hansard always catch the ball or take the wicket, depending which side they are on.
My hon. Friend the Member for South Ribble (Seema Kennedy) took us on a charabanc tour of her constituency. I have a slight concern—she referred to the “first” constituent she reversed into. I wait for her further speeches and interventions in transport matters, or perhaps health matters, to discover how many of the hospitals locally have been filled with injured constituents. What a tribute it is to her electability that, despite her mowing down constituents right, left and centre, she has still been returned triumphantly. Even better, when she arrives at the House, she models herself on George III. It may come as a surprise to her, but I was listening to her opening paragraphs, and she said she gloried in the name of Briton. That was exactly what George III said—exactly his sentiments. How nice it is to have his late majesty at least alluded to in this Chamber.
I must not speak for too long, and after these pourparlers I must get round to talking about the European Union, because hon. Members may know that my favourite activity on a quiet Thursday afternoon is making speeches on the European Union. If the House is not debating it, I do it at home and make members of my family listen to my views on it.
Of course, we have to start with the basics. There is a fundamental failing in the Bill in its very title, because it refers to “own resources”. It is not “own resources”; it is our money. It is British taxpayers’ money. It is not some fantastic European lottery win that has suddenly been found, and it is not like the gold that the kings of Spain found in Latin America of old. It is not made-up money; it is real money earned by British taxpayers running to the tune of £14 billion a year.
We have to be incredibly careful about how that money is spent and how willing we are to award it. We have already heard that the accounts have not been signed off for 20 years. One may think, “Well it may just be some minor error that means they have not managed to sign them off.” Actually, it is because they think that about 5% of expenditure has not been properly accounted for; roughly speaking, a third of our contribution is not properly spent, or they do not have the right receipts for it. This House has a duty, one of our most ancient duties, to ensure that the Government spend money properly and, when they give it away to international bodies, those international bodies also spend it properly. On whether it is spent properly, I will give the House a note on how the EU categorises spending given to overseas bodies.
The EU, for the purpose of signing off the accounts, says that if it gives £1,000 to a United Nations project and the United Nations project is worth £10,000, and that of that £10,000 in the project £9,000 was stolen, it will maintain that 100% of the money it has given to the project has been correctly spent, because if a percentage correctly spent is equal to or greater than the EU’s contribution, it deems it entirely properly spent. So when the accounts are not being signed off because there is 5%, or just under, of fraud or dishonesty or error, the figure is actually understated. We must push on that continually to make sure our money is properly spent.
There is a lesson for the Government in their success. In the previous Parliament, from time to time—although not as often as my hon. Friend the Member for Bury North (Mr Nuttall)—I did not do as I was asked to by the Whips. On one occasion, however, I was loyal. I was the proper sycophantic fellow that people hope I might be and I supported the Government. When the Labour party—in its wisdom, on this occasion—tabled a motion saying that the Government must come back with a reduction in the EU budget, I thought that that was impossible. I thought we were asking the Prime Minister to go and argue for something that simply could not be done, but he did it. He got a reduction in the EU budget which will feed through to a reduction in our gross contributions—a real achievement. This is the lesson for the Government: it was a real achievement because the Government were bold and ambitious, and willing to try something in the European Union that was thought bound to fail. We are coming to a renegotiation and what one hears so far about the width of that renegotiation is not encouraging. Let us hope the Government learn from where they have succeeded. The message to the Government as we consider the Bill must be:
“Ask and ye shall be given. Seek and ye shall find”.
When they try, they can achieve things people do not expect them to achieve.
This brief Bill is actually at the heart of what Governments do. What we take from our constituents to spend must always be spent carefully. The £14 billion that we spend is essentially a reiteration of our overseas aid budget: it is money going from a rich country to a poor country. It is not going to subsidise the Germans, for example; it is going to the poor countries in the European Union. We are now looking at a total for overseas aid in the order of magnitude of £26 billion. We have a duty to make sure that that is spent correctly. We have a duty to try to reduce it if possible and the Government must be encouraged by their past successes.
Royal Bank of Scotland
Jacob Rees-Mogg Excerpts(9 years, 5 months ago)
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Harriett Baldwin
The right hon. Gentleman asks a good question. I am sure the relevant Committees will take a close interest in this matter, because it is obviously a very large public investment. In terms of the liability side of the equation, he will be aware that there are a number of different pending regulatory matters that affect RBS. He will also be aware, as I think it says in the Rothschild report, that the market is aware of these things and will factor them into the price of the shares.
Mr Jacob Rees-Mogg (North East Somerset) (Con)
May I, too, welcome my hon. Friend to her post? I also welcome the shadow Chancellor, although I think we rather miss the more rambunctious approach of his predecessor. My hon. Friend the Member for Wyre Forest (Mark Garnier) illustrated the fundamental investment fallacy of not selling things on the basis of an historic price. Does my hon. Friend the Minister agree that the only reason the Opposition can take this foolish position is that clause IV may be out of their rulebook but it remains within their hearts?
Harriett Baldwin
I thank my hon. Friend for a very good point, very well made. It is absolutely the case that we are responsible for ensuring that, as we go forward from this decision point, we get the best possible value irrespective of what the previous Government paid, which was, in retrospect, too high.