European Union Bill

Lord Flight Excerpts

Monday 23rd May 2011 Lords Chamber

[Lord Stoddart of Swindon]

My Lords, I am a signatory to this amendment and, of course, support it. The noble Lord, Lord Willoughby de Broke, has provided a good deal of the history of referendums in other countries. The most recent case of a further referendum was in the Irish Republic, where the first referendum was held on 12 June 2008. During that referendum, Mr Barroso intervened to warn that, if the Irish rejected the Lisbon treaty, there was no plan B under any circumstances, and that there would be dire consequences not only for Ireland but for the whole of the European Union. Nevertheless, the Irish voted no on a 53 per cent turnout, with 53.4 per cent voting no and 46.6 per cent voting yes. There was pandemonium all over the place, especially in the European Union. Many people thought that the Irish had spoken and that that should be the end of the matter, especially as Mr Barroso had denied that there was a plan B, but obviously there was a plan B—another referendum. That took place on 2 October 2009. As noble Lords will know, the result was reversed after a bitter campaign, during which the European Commission and the Irish Government weighed in with taxpayers’ money—probably illegally, incidentally. According to Mr Jens-Peter Bonde, who at that time was a senior MEP, the Commission and the Irish Government between them spent millions of euros supporting the yes campaign. As if this huge support was not enough, large amounts were also contributed by vested interests, including €250,000 by Ryanair. In fact, 10 times as much was spent on the yes campaign as on the no campaign—little wonder, then, that the Irish people reversed their first vote by a 2:1 majority.

However, that was not the first time that the Irish people had been made to vote again. When they had the temerity to vote no to the Nice treaty, they had to vote again to provide the only answer that was acceptable to the European Union and the Irish Government—in other words, if people do not provide the right answer first time round, they will be made to vote again until they do. That is the impression that is given, and that is why in many respects the European Union and some of the nation states are held in contempt by their peoples.

However, as we have heard from the noble Lord, Lord Waddington, the Irish people were not the only ones who were made to vote again. When the Danish people voted no to the Maastricht treaty in 1992, they were forced to vote again a year later in 1993. Again, the no campaign was out-financed and clobbered by their own Government and others with vested interests in obtaining a yes vote—and this was duly achieved. However, as noble Lords may remember, when the result was declared the Danish people were so annoyed that they actually rioted in Copenhagen, the police fired 113 shots into the crowd when it was trapped, and 11 people were treated for gunshot wounds. When people feel cheated about their decisions, in some cases and under some circumstances, they are prepared to cause mayhem and riot.

Therefore, for these and other reasons, I support the amendment and hope that the Government will accept it. Before I sit down, I ask for an assurance from the Government that in any referendum under the Bill they will not use taxpayers’ money to support one side of the argument, and that they will prevent the use of taxpayers’ money by any institution of the European Union to support one side of the argument. That should include the European Parliament, which has just voted for a change in funding rules that will allow cross-national EU political groups of MEPs to take part in referendum campaigns in member states. It would be quite outrageous if MEPs from any part of the EU, with taxpayers’ money through their expenses, were able to indulge themselves in a specifically British referendum. Unless the Government can assure us that they will block such activities, I support the amendment.

[Lord Flight]

My Lords, it is very tempting to support the amendment, and the noble Lord, Lord Stoddart of Swindon, made some good points about expenses. The forced holding of second referenda has been shameful and has involved quite improper practices. However, I should like to make two points on why the amendment may not be appropriate for this country. The first is that any second referendum would require the approval of both Houses of Parliament. I trust that this House, unless it is dangerously interfered with, would act properly in that situation. Secondly, in the event of a referendum on “in or out” in which people voted to stay in but certain developments in Europe within the five-year period made the situation dramatically different, it would be unwise to be limited by a five-year rule that the UK could not reconsider the issue again in the light of future developments. Many Members of this House are sympathetic to the amendment on the improper use of forced second referenda, but such a measure would not be appropriate in this country.

[Lord Empey]

My Lords, many people would be sympathetic to the amendment. There was, however, a difference between the two referenda in Ireland, and the difference was that the Irish Government believe that they negotiated a stronger deal. They were going to lose their Commissioner and various other things, so they negotiated hard and obtained changes.

The way in which Brussels went about things in the Republic was brutal. People felt intimidated and threatened, and their financial security was threatened. Of course we can see why that happened and the genuine concern. Public opinion in the Republic since the imposition of what the public regard as penal conditions surrounding the bailout is shifting against the European Union. I have no doubt that, as the noble Lord, Lord Stoddart, said, there was intimidation. It was not a pretty picture. However, one thing that would worry me about the amendment is that if a proposition were before our Government and Parliament that contained certain conditions that we objected to and those conditions were subsequently, because of the referendum, negotiated out, where would we be if we found that we had what we had asked for? We would not be able to do anything about it for five years. That is my only concern. I do not dispute the sentiment or what actually happened, because I saw it from next door, and it was brutal. However, the Irish Government negotiated a better deal. That is my only reservation about the amendment. If we found that we were able to negotiate, we would be hamstrung.

The other lesson is that having a referendum behind you as a requirement has proved to be a strong negotiating tool. The Irish are a classic example. Because of their fundamental financial weakness, they were not able to press it home, but they got improvements. In our circumstances, what would we do if we were able to negotiate what we wanted and achieved our objectives?

--- Later in debate ---

[Lord Triesman]

My Lords, however many times the Irish people were asked to vote would have been a matter for the Government of Ireland. In the same sense, I hope that we would have sufficient sovereign pride to conclude such an issue ourselves, although I think it highly improbable. Perhaps I may add that the circumstances in which people might be asked to vote a third, fourth or subsequent time seem not at all likely.

[Lord Flight]

A problem for Ireland when it adopted the euro was that the inflation rate there was much higher than in Germany, which resulted in virtually negative interest rates in Ireland. That resulted in people borrowing as much as they could and putting the money into assets such as property. That produced the property bubble, and the bursting of the property bubble was the main cause of the banking system’s problems.

[Lord Triesman]

My Lords, anybody who looks at the difficulties that have been experienced in many mature economies, whether or not they are in the euro, will recognise that the financial problems created by property speculation and, in particular, by funding sub-prime derivatives in the property market have nothing whatever to do with the euro in most cases. It was a wave of mad speculation—it can only be described as madness—because it was possible to do it under the interest-rate conditions that obtained generally around the world. They are not so varied between countries in either hemisphere.

Of course it is true that in the referenda conducted in the countries that we are discussing, they concluded, as they were perfectly entitled to do, that what was being put in front of them was not good enough. We know, however, in part from the noble Lord, Lord Empey, in terms of the role of the Commissioner in Ireland, and the issues that came up in Denmark on whether the people would be compelled into defence propositions that they did not like, or whether people in Ireland would be compelled to change the abortion law or consider NATO membership, that all of those things produced circumstances in which there was a no vote. Those Governments negotiated again and got those terms changed. Protocols were introduced in almost every incidence to get those terms changed. They then went back and asked the people of their countries whether the changes in terms were sufficient to merit a change in the view that they had taken.

That seems to me to be completely legitimate. I cannot for the life of me understand why someone would say that it is a legitimate outcome if you vote no by, say, 52.5 per cent—that is plainly a no vote; I understand that completely—but when it is put again it is completely illegitimate if something like 65 per cent of the people in that vote say yes. What is the point of a sovereign decision by people when they are asked to take a vote if you do not accept the outcome in either direction—like it or dislike it; it is irrelevant? It is their decision and they have taken it. The idea that any country, least of all this one, should feel that it is bound to be strong-armed into taking a different decision if the first decision does not accord with perhaps the general sentiment in Europe is completely fanciful. It is disrespectful to the people of this country and this debate has been disrespectful to peoples of other countries, too.