European Union Referendum Bill

Lord Clarke of Nottingham Excerpts

Tuesday 9th June 2015 Commons Chamber

[Mr Hammond]

I am going to make a little progress, bearing in mind Mr Speaker’s exhortation.

It is almost four decades ago to the day that I, along with millions of others in Britain, cast my vote in favour of our membership of the European Communities, and like millions of others I believed then that I was voting for an economic community that would bring significant economic benefits to Britain, but without undermining our national sovereignty. I do not remember anyone saying anything about ever-closer union or a single currency. But the institution that the clear majority of the British people voted to join has changed almost beyond recognition in the decades since then.

[Mr Kenneth Clarke (Rushcliffe) (Con)]

There must have been some strange juxtapositions in the campaign held in the 1970s, in which I took a very active part. Most of the debates I took part in were about the pooling of sovereignty and the direct applicability of European legislation without parliamentary intervention, which was a very controversial subject, and, besides, ever-closer union was in the treaty to which we were acceding.

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[Mr Kenneth Clarke (Rushcliffe) (Con)]

I have to tell the right hon. Member for Gordon (Alex Salmond) that, though I enjoyed his speech very much, he has not persuaded me to support the SNP amendment tonight. That is not because I no longer have fundamental doubts about referendums. Like every politician of my generation, I prefer parliamentary democracy, but we are where we are and it is obvious that we will have a referendum. I probably will not vote in favour of the Bill tonight, but I shall do nothing to stop it going ahead in principle.

I would only warn my right hon. and hon. Friends that since Harold Wilson made the unwise decision to introduce the institution into our British constitution it has never yet been used to settle any question. The question of proportional representation, for example, is very much alive and kicking. The question of elected mayors does not seem to have been totally resolved by all the local referendums. The future of Scotland, and what I hope will be its continued relationship with the United Kingdom, has been enlivened, not quietened, by the result of the recent referendum. Now we are to have one on Europe again.

I agree with the right hon. Gentleman that politicians of conviction fight in referendums and accept that they have lost them, but they do not change their fundamental views. I do not believe that my right hon. Friend the Member for North Shropshire (Mr Paterson) will become an enthusiastic Europhile if he is on the losing side of the referendum, and he will not be surprised to learn that I am likely to be found supporting the yes campaign, but I hope that the referendum campaign will be of the same extraordinarily high quality as the Scottish one, in which I took some small part. I have never known the population be so politicised or have such an intense debate. So far, I have been on the winning side in all the important referendums, and I hope that I will be so again after an interesting campaign.

[Mr Owen Paterson]

I think that I have one over my right hon. and learned Friend in that I have been the president of a European trade association and he has not. He really must not muddle the idea of the European Union, which is a political and judicial organisation, and the European market, of which I am a most enthusiastic proponent.

[Mr Clarke]

My right hon. Friend appears to believe that we can somehow have all the advantages of the European Union and the market without complying with any of the obligations. I know of no trading bloc that allows anybody entry to its markets on the basis that they will decide whether to comply with its rules.

I approve of the form of words in the Bill for the question but I hope, as the campaign goes on and we all form all-party campaigns, it becomes crystal clear what the question actually means. It is not solely about the negotiations for reform. Personally, I completely concede that the European Union has a lot of defects and is ripe for reform, and I approve very strongly of some of the measures, particularly those in the Bloomberg speech, which my right hon. Friend the Prime Minister is pressing for—if he can achieve them. However, the yes vote involves a decision on the future role of the United Kingdom in the modern world: how we are best able to further the interests of our citizens, defend our security, develop our economy and bring prosperity. That is the big question.

[Sir William Cash]

Will my right hon. and learned Friend give way?

[Mr Clarke]

I will not, because we are under a time limit and other people want to speak. I apologise to my hon. Friend. He and I have debated this frequently.

We are 1% of the world’s population and we represent 3% of the world’s GDP. As a proportion, we are declining yet further. On the question of being in the European Union, we need to get across to people that our effective voice in the world, insofar as we have one, is best deployed as a leading and influential player in the European Union. There will be less interest taken in British views by the United States, Russia, China, India and other emerging powers if we go into splendid isolation. As I have already said, the idea that we can somehow advance our future prosperity by withdrawing from the biggest organised trading bloc in the world, while at the same time, as a Conservative party, advocating wider free trade wherever it can be obtained, is an absurdity.

That leads me to the other argument: what does “out” mean and what does a no vote mean? I look forward to my Eurosceptic friends providing an answer to that, because Eurosceptics have always given different answers. My former hon. Friend who is now in the UK Independence party, the hon. Member for Clacton (Mr Carswell), has a quite different view of what a no vote means compared with some of my no voting colleagues on the Government Back Benches. Does it mean the Norwegian option? Do we stay in the trading area? That would mean we pay a large subscription, accept free movement of labour—Norway has a higher proportion of other EU nationals compared with Norwegians than we have compared with Brits—and comply with all the legislation, rules and regulations of the single market without having any say in them.

Do we go further than that and have the Swiss model? The Swiss model means we would have some access to the single market. However, in those areas we would have to comply with all the laws and rules that would be directly applied and have no influence on what they are.

[Mr David Nuttall (Bury North) (Con)]

Will my right hon. and learned Friend give way?

[Mr Clarke]

I cannot as there is a time limit.

The Swiss do not have access to large parts of the market, although I would add that they accepted the free movement of labour. They have no access to European financial services, or any other services. Swiss banks are providing investment and employment in the City of London because Switzerland is excluded from the extremely valuable part of our financial services industry, on which a lot of our prosperity depends. Normally, I find that Eurosceptics do not address that.

Do Eurosceptics wish to go into the wide blue yonder and leave the trade area altogether? That would involve tariffs. That would involve 10% tariffs on vehicle exports to Europe. I doubt whether my hon. Friends are advocating that we should cease to have any access to the market at all. We need to be absolutely clear that the Eurosceptic case is usually that we are so important to Europe that the other countries, if we negotiate strongly enough, will allow us to keep the benefits of membership and give way on the obligations.

As I have said, there are some things that we ought to negotiate. However, we should be wary of getting too carried away by freedom of movement of labour, which is desirable in a trading area. It is a benefit to all members, including the United Kingdom. We should, of course, stop benefit tourism. Benefit tourists are unwise if they come here, because benefits are more generous in Germany, Sweden and in many other places. No doubt they will agree with us on clarifying the exclusion of benefit tourism.

What we need to bear in mind about seeking to go further is that 2.2 million British people are living and working in the rest of the European Union, and about 2.5 million EU citizens are living and working here. If we are going to demand treaty change to permit us to discriminate against European foreign nationals—not other foreign nationals, but European foreign nationals—in our employment laws, our tax system or our benefit system, are they going to forgo doing the same thing to British residents in other countries? There are more British people drawing unemployment benefit in Germany than there are Germans drawing unemployment benefit here. I think that an Englishman working alongside a Frenchman in an international company in France should, if he is doing the same job, have the same take-home pay. I find it difficult to argue why an Englishman and a Polish person working alongside each other doing the same job in Britain should not have the same pay either. Freedom of movement of labour benefits us.

Eurosceptics love to demand treaty change. They do that because they know it is not possible to get treaty change to a complicated 28 nation state treaty before 2017. It takes five or six years. We can have legally binding protocols on particular matters, which has been resorted to, and I am sure ingenuity in the Foreign Office and in the corridors of Europe will produce legally binding protocols for anything we produce. To make a touchstone of treaty change, when there are 27 other Governments who will follow our lead in the process and all start demanding things, is not worth pursuing.

The key issue is to have a campaign, as well as a question, that is absolutely clear. This is about Britain’s role in the modern 21st-century world of interdependent nations. How do we maximise our influence? By using our powerbase in Europe. The alternative, I am afraid, is a fanciful escapist route into isolated nationalism which would greatly diminish our influence in the world and greatly damage our economy.

[Several hon. Members]

rose—

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[Sir William Cash]

My hon. Friend is absolutely right.

Removing the words “ever-closer union”—which have never been specifically adjudicated on by the European Court of Justice, and merely form part of the preamble to the treaties—will not solve the problem. It does not change the legal obligations of the accumulated treaties, from Maastricht to Lisbon. Notwithstanding their protestations, it will not be the establishment, the EU, the BBC or the self-appointed multinationals with vested interests who will decide these matters. None of those multinationals has advanced a rational argument to support their determination to stay in the EU. That is my response to what was said by my right hon. and learned Friend the Member for Rushcliffe, who asked the same question of us from the other side of the argument. They were hopelessly wrong about the euro, and have been hopelessly wrong about so many aspects of European debate.

It is the voters who will give their verdict by the end of 2017. It is the voters, and the voters alone, who will decide it, not the massed ranks of the Europhiles. The rolling back of the treaties is imperative to our national interest. Indeed, the 1971 White Paper, on which the European Communities Act 1972 is still founded, clearly stated that we must keep the veto precisely because it was in our national interest to do so. It went on to say that to do otherwise would

“imperil the very fabric of the Community.”

I look at my right hon. and learned Member for Rushcliffe because he knows that he supported that at the time, in 1971.

[Mr Kenneth Clarke]

My hon. Friend is quite right. In 1971 we had unanimity when making European laws, but once made, they were directly binding. It is the second issue that my hon. Friend is trying to reopen. In the Lisbon treaty, we went for weighted majority voting, because, with 28 member states, giving every Government the right to block any proposal would prevent any decisions from being made.

[Sir William Cash]

It was for precisely to deal with that problem that I set up the Maastricht referendum campaign. My right hon. and learned Friend and others have persistently and continuously opposed a referendum, because they have not wanted these matters to be reopened. However, they have been reopened by virtue of this Bill.

I was concerned to hear the Foreign Secretary say on Sunday that the unilateral repeal of EU legislation at Westminster was unachievable, and would lead to our leaving the EU. Of course, the second part of that proposition is inherent in the referendum itself; the voters will decide. The Foreign Secretary invoked the analogy of the yellow card, which has been a dismal failure. When it was applied in relation to the the European Public Prosecutor, the Commission simply ignored the result.

During the Maastricht debates, we were told by the then Foreign Secretary that the Maastricht Treaty was the

“high water mark of federalism”.

That was patent nonsense, as has been demonstrated by so much of the Europhilic commentary that has poured out in a relentless tide of enthusiasm for European integration, and which has engulfed the United Kingdom and Europe as a whole, causing protests, riots and massive unemployment. It will drag Europe down, and will create the very instability that the project after 1945 was intended to avoid.

We need amendments to this Bill, relating to matters such as the purdah arrangements, the question of prohibiting European or governmental money, the question of the impartiality of the broadcasting authorities, the level of expenses, the timing and also, perhaps, the question in the referendum. According to recent opinion polls, trust among the European voters is at an all-time low, and that trust is what lies at the heart of the whole debate. In the words of Lord Randolph Churchill, we must trust the people.