European Union (Referendum) Bill

Debate between Lord Davies of Stamford and Baroness Liddell of Coatdyke

Friday 31st January 2014 Lords Chamber

[Baroness Liddell of Coatdyke (Lab)]

My Lords, I support the amendment. In an earlier intervention, the noble Lord, Lord Hannay, drew a parallel with a debate we had in this House yesterday about the Scottish referendum. One of the key themes that came out was the need for a plan B regarding the currency. The noble Lord, Lord Wigley, referred to uncertainty. Take it from me that if you are in an extended referendum campaign, the impact of uncertainty, particularly on business intentions, is very considerable indeed. We are not confidently out of recession; even the Chancellor acknowledges that. One thing that business cries out for is a degree of certainty. That is why this is a common-sense amendment. We have to go into any referendum in an atmosphere of calm. It should not be held in an atmosphere in which some people think that the rug is going to be pulled for political reasons rather than for the best interests of the country as a whole.

Before the end of this year, one part of Britain will take a vote on whether to leave the oldest and most successful single market in the world. If there is a no vote in the referendum to come on the EU, we will be taking a decision about leaving the biggest single market in the world. It is essential for the long-term decision-making of British and international business for us to give an indication of the options, what the possible plan B is, and what the consequences will be. The Government, as part of the debate about the future of Scotland, has produced some excellent analytical papers. I commend to noble Lords who do not want to go into the minutiae of the nature of the debate on Scotland one paper in particular: the analysis of the situation regarding defence. The capability exists within the Civil Service to produce a balanced argument.

I know that the noble Lord, Lord Dobbs, is a little more anxious today than he was last time, and I feel for him. It is probably the only time in this House that he will ever have unrestrained power. As a Back-Bencher with a Bill, he is in a position, without consulting anybody else, to be able to say that he accepts an amendment. We will get a move on and put a common-sense element into the Bill. If there had been schedules to it, we could have looked at them; but there are none. I therefore appeal to the noble Lord. Let us give a crumb to those who want this campaign to take place in an atmosphere of calmness and give a signal to the business community, which has lots of money to invest at the moment, that it can do so in an atmosphere of certainty.

[Lord Davies of Stamford (Lab)]

My Lords, I take it as pretty certain that there will ultimately be a referendum because, at some point, there will be a new treaty anyway. I totally agree with my noble friend Lady Liddell that any referendum produces economic costs and uncertainties, and that is why it is particularly regrettable that the Government have, quite unnecessarily, brought forward this entirely gratuitous Bill in this Session of Parliament to have a referendum at some point in the next Parliament. It would be much better if we left the matter until then.

However, I do not think that our labours are wasted because what we are producing today, were producing last week and will go on producing in the remaining days on which the Bill is under consideration, is a kind of template for any future referendum when it occurs. It will be clear to any Government what can and cannot get through the House of Lords. No Government will again be tempted to try to fiddle around with the main question to be asked on the referendum ballot paper, which we discussed last week. The Bill has now established that and it would not be sensible to change it. In future, Governments will be guided by the Electoral Commission’s views on what the proper question would be. Again, if we were to pass this amendment, it would be carried forward into any future Bill, even if this Bill were not to be passed and this referendum did not take place.

A few moments ago, the noble Lord, Lord Hannay, said that if we had a referendum the country would have a very stark choice. I entirely agree. We all know that it will also be a very momentous choice, but it will actually be a rather uneven choice because the British public will be asked to choose between a known and an unknown—between an established and familiar fact on the one side and a purely hypothetical speculation on the other. It is very unfair and very dangerous to put the electorate in that position. It is dangerous because in those circumstances there is great scope, and therefore great temptation, for the promoters of the unknown option—those who, in this case, want to leave the European Union—to replace the unknown with a picture of their own devising which may be entirely fanciful, very wishful and even deliberately and cynically deceptive. That would be a very bad thing; it would be a very bad day for democracy to have a dishonest campaign of that kind. Therefore, it is very important that the electorate is able, as far as possible, to choose between two explicit descriptions of the two scenarios that are being offered. That is why I think that the amendment is enormously important.

There are some areas where a relatively reliable statement can be made about an unknown. For example, we all know that the Tory party does not like the Social Chapter. If we leave the European Union, we will not, by definition, be part of the Social Chapter, so it will be possible to say to people that there will not be a part-time workers directive or a parental leave directive, and anybody who is a part-time worker or who is thinking of having children will know where they stand. There are areas of greater uncertainty but they are ones where one can at least produce a reasonable description of the sort of scenario that might eventuate. For example, people are particularly concerned about whether we could still have access to the single market. There is a precedent in Norway and a precedent for EFTA, so there is a certain degree of credibility and responsibility in saying that there is certainly a likelihood that we could join EFTA if we wanted to. However, the rules of EFTA are quite clear—they have already been mentioned this morning—and it has already been explained why in many cases it would be very unsatisfactory to a great many of us.

However, there are areas where nothing certain at all can be said about what the position would be if we left the European Union today, and I fear that that is becoming increasingly likely in relation to the great area of access to the single market. Recently I have noticed that even those people who have been advocating our leaving the European Union have ceased to say, “Well, we could get a deal like Norway”. They have even ceased to say that we could get a deal like that of Switzerland. There is universal consensus on the continent among our partners and in the Commission that no one would ever be allowed to do a Swiss-type deal again. It is simply too complicated and difficult to administer with, I think, 140 separate agreements with the European Union. That type of scenario is out anyway, and anybody who takes a look at the situation will realise that it is not a possibility.

Therefore, one increasingly hears—we hear it increasingly often in this House—Eurosceptics and promoters of our leaving the European Union who say, “We’ll do better than Norway or Switzerland”. What do they mean by that? It seems to be far from clear. I detect in conversations with continental colleagues that in the type of circumstances in which we would leave the European Union there would be very little inclination to come up with special favours for us. Some have said, “Oh well, we have a deficit with the European Union. The rest of the European Union exports to us more than we export to them”. However, in point of fact, it is not a question of how big the deficit is for us or how substantial our imports or exports are; the leverage consists of the extent to which our trade is a proportion of the trade of our continental partners. It is generally never more than 25%. Therefore, I am afraid that we probably do not have a leverage.

In any case, there is no point in speculating about this, and it would be very dishonest to do so. It is important that a serious effort is made to sort out the consequences of our leaving the European Union. That should be set down in black and white by a Government who are then committed to making sure that they do not say anything which is deliberately untrue. They would have to have had serious discussions with our colleagues and partners in the rest of the European Union about what would and would not eventuate from our leaving. The British public could then be offered a genuinely honest choice between two scenarios, the details of which would have been set out as truthfully as possible.