European Union Bill
Lord Pearson of Rannoch Excerpts(13 years, 8 months ago)
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Lord Pearson of Rannoch
My Lords, as this is our first major debate on EU matters since we finished with the Lisbon treaty three years ago, I must start by making an apology. At the end of those proceedings, on 18 June 2008, I regretted that, with one honourable exception in the shape of the noble Lord, Lord Williamson, noble Lords in receipt of an EU pension had not declared that interest. Many of us, including your Lordships’ Sub-Committee on Lords’ Interests, chaired by the noble and learned Lord, Lord Woolf, felt that such pensions should have been declared because they can be taken away if a holder breaches certain obligations arising from their time in office. This applies to former members and officials of the European Commission, but I made the mistake of saying that it also applies to former MEPs, which it does not. I therefore apologise now to those I named, particularly to the noble Baroness, Lady Quin, with whom I subsequently corresponded.
It is regrettable that the nomenklatura in your Lordships’ House has since confirmed that even former EU Commissioners do not need to declare their forfeitable pensions in our debates. They tend to be some of the most blinkered and enthusiastic advocates of our EU membership. It is not helpful to the public if they do not know where those noble Lords are coming from, so I hope that they will do so anyway, although I have to say that the noble Lord, Lord Clinton-Davis, has already failed the test. I would have thought, too, that former MEPs might also want to mention this experience because it suggests that they might have—
Lord Clinton-Davis
I do not have to declare it every time, but it is well known that former Commissioners get some sort of allowance by way of pension. It is not as vast a sum of money as the noble Lord suggests.
Lord Pearson of Rannoch
My Lords, the test of whether it should be declared is what a reasonable member of the public might think, and I am very glad that the noble Lord, Lord Clinton-Davis, has now passed the test.
Lord Tomlinson
My Lords, can I invite the noble Lord, Lord Pearson of Rannoch, to pass his own test? I once asked him whether he was prepared to declare the interest that he got for forestry land that he owned from the FEOGA—the European Agricultural Guidance and Guarantee Fund. All I got from him was an abusive letter and no declaration of interest. I wonder whether he wants to catch up with us now.
Lord Pearson of Rannoch
My Lords, the noble Lord is coming close to misleading the House. I put the matter straight in a letter to the Guardian newspaper, which had suggested that I had taken this grant. It is not a grant. The noble Lord might like to know that when something goes wrong with a plantation, for instance if it burns down, you have to repay the money or replant the thing at your own expense. He will be delighted to hear that the plantation in question has burnt down and I have had to replace it.
I was suggesting that even noble Lords who have been MEPs might want to mention that experience because it suggests that they may have a better understanding than most of the complicated world of Brussels, but of course it is up to them.
Baroness Quin
I am interested in what the noble Lord says. I spent a much longer time being a Member of the other place. Do I need to declare that every time I get up to speak?
Lord Pearson of Rannoch
I think I said that the noble Baroness does not need to declare her pension as a former MEP. The difference is that pensions from the other place are not removable, whereas pensions for former EU Commissioners are removable. It is removable from former Commissioners but not from MEPs. That is what I thought I had said and that is why I went out of my way to apologise to the noble Baroness for putting her in the wrong category before.
Lord Hannay of Chiswick
My Lords, the noble Lord has for years been worrying at a very old bone, and it does him no credit that he returns to it. Could he perhaps tell us how many members of the Commission have had their pensions withdrawn for having expressed political opinions in a place like your Lordships’ House? He continually rests the whole of his case on the fact that they are at risk every time they speak in debates such as this if they do not take the line that, presumably, has been dictated to them in e-mails from Brussels. That, frankly, is completely absurd, and he is just wasting the time of your Lordships’ House.
Lord Pearson of Rannoch
My Lords, I do not think that I am the one who is wasting the time of your Lordships’ House. I suggest that the noble Lord reads the opinion of the noble and learned Lord, Lord Woolf, and of our Sub-Committee on Lords’ Interests, and any other noble Lords who are interested in the subject should do that. I think it lowers the tone and skews the quality of your Lordships’ debates if people who are exposed, however remotely, to losing a very substantial pension do not continue to fulfil the obligations they had when they were Commissioners. In that, I think the EU pension is unique. It is a great shame.
Lord Kerr of Kinlochard
It was extremely handsome of the noble Lord to start his remarks with such a fulsome apology, but I hope that he might now address the Bill.
Lord Pearson of Rannoch
Given the chance, that is exactly what I was going to do. We have now wasted five minutes on this.
Lord Pearson of Rannoch
The interventions have not added anything to what I have to say.
The Government are holding up the Bill as a “thus far and no further” Bill, which it probably is, and to that extent I welcome it. However, I cannot help seeing it more as a “shutting the stable door” Bill. Your Lordships’ House remains a very Europhile place; only perhaps a dozen noble Lords are prepared publicly to advocate withdrawal from the European Union out of a membership of some 800. This makes the subject of Europe unique in your Lordships’ House. In every other area of our national life, your Lordships have your fingers very much on the national pulse—often far more than the House of Commons—but when it comes to Brussels, most of your Lordships are solidly out of touch with popular feeling. This has grown steadily more Eurosceptic since our Lisbon proceedings, to the extent that now around 75 per cent of our people want not only the improbable referendums proposed in the Bill but a referendum on our EU membership, and around 50 per cent say that they want to leave anyway.
I hope that noble and Europhile Lords will not be tempted to suggest that this is because the gullible public have been conned by the wicked Murdoch press, to which I would reply that our national press is more than balanced by the entrenched Europhoria of the BBC. For instance, the BBC has yet to fulfil the promise it gave in 2005 after the Wilson inquiry to explain to the British people how the institutions of the EU interact and their effect on our British way of life. The inquiry had been into whether the BBC was biased in favour of our EU membership and it found that it was—so in view of their opening remarks I hope that the noble Baronesses, Lady Symons and Lady Williams, will agree that it is a great shame that the BBC has not fulfilled that commitment. Perhaps we can work together to encourage that.
Anyone who doubts the BBC’s continuing bias should consult the globalbritain.org website or listen to the BBC’s director-general, who admitted before Christmas that the BBC had been what he called “weak” on Europe. He also said that views that start off as extreme can become the prevailing view inside five years.
Lord Lea of Crondall
Does the noble Lord have anything to say about the role of Mr Rupert Murdoch, who is undoubtedly biased? The BBC’s bias is in the mind of the noble Lord, Lord Pearson. Is it not obvious that a great part of the media—now further reinforced by Mr Hunt—is under the control of an American-Australian, who is enormously biased and would influence any referendum?
Lord Richard
Does the noble Lord, Lord Pearson, agree that this is a debate about the Bill and not the British press?
Lord Pearson of Rannoch
My Lords, in that case I shall not reply to the noble Lord, Lord Lea. I do not know about it anyway.
This is also a debate about British public opinion—what the British public want, what the Bill supplies and what the Bill which the British public have been promised could supply. Who would have thought five years ago that a major national newspaper, the Daily Express, not owned by Mr Murdoch, I think—
Lord Pearson of Rannoch
—would run a campaign to get us out of the EU? Who would have thought then that 373,000 of its readers would have signed a petition to leave? Most of those people took the trouble to fill in a small form, cut it out and post it to the Express. Does that not reveal quite a bit of energy? Now there is a new campaign, the people’s pledge, launched last week. It is an all-party national campaign, led from the left, which asks people to sign a pledge online that at the next general election they will vote only for a candidate who promises to support an in/out referendum on our EU membership. It includes people who believe we should—
Lord Sewel
Could I renew to the noble Lord the invitation of the noble Lord, Lord Kerr, to get on with the Bill?
Lord Pearson of Rannoch
At this rate I will be at more than 20 minutes. I suggest that noble Lords do not interrupt, but it is of course up to them. As I was just saying, this new campaign has people on it who believe that we should stay in the EU but who still want a referendum. So far, some 50,000 people have signed it and thousands more have volunteered to campaign as activists. I suggest that noble Lords have a look at it at peoplespledge.org.
Then there is UKIP and its performance at the recent Barnsley by-election, where it beat the Conservatives and Liberal Democrats into second place. In fact, we got nearly as many votes as those two parties combined. I am sure that much of the success was due to the fact that it now has a decent leader again, and it was of course only a by-election, but something is moving out there in the country. That something is the country’s growing wish to have a referendum on our EU membership. That wish will not be met by the Bill. The Bill is an irrelevance to that wish.
Why do Her Majesty’s Government refuse the people the referendum that they want and which they were promised, and instead offer them the pale imitation that is the Bill before us? The answer is clear; they think that they would lose the referendum which the people want and we would then have to leave the EU. In the Government’s defence, they seem to really believe, as do most of our political class, that leaving the EU would somehow be bad for trade and cost British jobs. I think they believe that because so few of them have ever run an international business. They just do not know how it works.
I guess that this would be the central debate in any referendum campaign about our membership. I give the Government and your Europhile Lordships four brief reasons why leaving the EU would have the opposite effect to the one that they might genuinely fear. First, we indeed have 3 million jobs exporting to clients in the EU, but it has 4.5 million jobs exporting to us, so it would want to continue its free trade with us. We are in fact its largest client. Would the French stop selling us their wine or the Germans their cars just because we are no longer bossed around by Brussels? Our trade and jobs would continue. There is no fear on that score.
Secondly, the EU has free-trade agreements with 63 countries worldwide, with more in the making, so why not with us—their largest client? Thirdly, the World Trade Organisation would also prevent any retaliation, and anyway the EU’s average external tariff is now down below 1 per cent so there is not much point to retaliation. Fourthly, Switzerland and Norway, which are not in the EU, also enjoy free movement with the EU and every other facility that we have. They control their own immigration and export much more per capita to the EU than we do—Norway by five times and Switzerland three times.
Lord Teverson
I thank the noble Lord for letting me intervene. Although Norway and Switzerland are not within the European Union and have full relations with it, the result is that they have very little control over their legislation. The way it works is that the European Union faxes instructions to the Governments of Norway and Switzerland in those areas and they have to comply or withdraw from the European Economic Area. That is the problem. You have the single market but far less control and no input into the legislative process.
Lord Pearson of Rannoch
That point is often made. Of course, if we were not in the European Union, we would have to obey the EU rules for the exports that we sent to them, but not in our own internal market and not to the rest of the world. Most countries in the world export to the European Union without that problem. It is really not a real one.
Lord Hannay of Chiswick
The noble Lord is propagating nonsense, if I may say so. Norway and other countries are obliged under the European Economic Area treaties to apply the single market legislation to their own market. They do not apply them only to the goods that they export to the European Union. The noble Lord would do well to recognise that he would be bossed about by Brussels even if he had his referendum and got us out of the European Union, with all the other damage that that would do to us.
Lord Pearson of Rannoch
My Lords, the noble Lord is making the usual mistake of thinking that we would stay in the European Economic Area. Why would we? Why would we not have a relationship like Switzerland and like all the other countries in the world that export to the European Union and are not bossed around by the Brussels rules?
I am not suggesting that the British people are fully up to speed with the four points that I have just made—nor, indeed, is the noble Lord, Lord Hannay—but they are getting the point that the EU is ruinously expensive, that we cannot afford it, and that it has taken away their sovereignty, and their right to elect and dismiss those who make their laws. Most of our national laws are now made secretly in Brussels, where our Government have some 9 per cent of the votes, and our MPs, for whom the people vote, are irrelevant in that process. The people are also right when they fear that they can no longer afford EU membership, which is untouched by this Bill. I give your Lordships six points to prove that.
Lord Pearson of Rannoch
Well, my Lords, they are quite important. Some £8.3 billion per annum is sent in cash to Brussels, which is £23 million a day or 750 nurses, teachers or policemen thrown away every day at £30,000 a year each. Yet we are struggling to cut the same amount from our own public expenditure.
Secondly, there is really no such thing as EU aid or subsidies to us. For every £1 they send us, we have given them £2.10. Then we are borrowing millions more to bail out the euro, which we might not get back. Every family in the UK spends £1,000 more on food than it would if we were not in the EU.
Then the Treasury has estimated that overregulation from the EU costs up to 6 per cent of our GDP, or £84 billion a year—the equivalent of £1,400 per person. There is no doubt that this handicaps our exporters worldwide and would hit the City and its tax revenues hard. As I mentioned to the noble Lord, Lord Teverson, all this is against the background that only 9 per cent of our GDP goes in trade with clients in the EU, while 11 per cent goes to the rest of the world and 80 per cent stays in the domestic economy. Yet the whole 100 per cent of our economy is hit by the diktats from Brussels. No wonder the Government refuse a cost-benefit analysis on our membership.
The Daily Express campaign and other campaigns have made the British people see that Brussels interferes in every aspect of their lives—immigration, rubbish collection, post offices, light bulbs, car premiums, working time, as mentioned by the noble Lord, Lord Kakkar, our fishing industry, financial supervision and so on. Governments of all persuasions have for years dismissed how much of our law is imposed by Brussels, with the House of Commons and your Lordships' House irrelevant. However, the people are now beginning to understand it and they do not like it.
To cap it all, none of what I have just mentioned can be changed without the unanimous agreement of all 27 member states. That is why so many of us say that the only way out is by the door.
Could I conclude by saying—
Lord Pearson of Rannoch
I am glad to be so popular. I conclude by asking the Minister one question. The noble Lords, Lord Tebbit and Lord Stoddart, and I asked a long series of Written Questions going back to 18 October last year and ending on 16 February. We asked what areas of our national life are now not subject to interference or control from Brussels, and what areas of our national life we are left with entirely to ourselves that are not subject even to unanimity. Which areas of our national life could become the subject of referendums under this Bill? In his Written Answer of 27 January, the noble Lord said:
“There are many areas of our national life where the UK remains the final authority, such as the functioning of Parliament … and the deployment of British Armed Forces”.—[Official Report, 27/1/11; col. WA 191.]
On 16 February, I asked him with what else we are left. He merely referred me to earlier Answers that set out treaty clauses that give our powers away, but he did not point to any more that we still have. Can he answer that question now? I fear that there might not be any. That would be another reason why this Bill is something of an irrelevance, because the horse has already bolted.
We have nothing left to have a referendum about, apart perhaps from joining the euro, but in view of the disaster which that initiative has become, that is really not a starter. It would be another reason why the British people do not need this Bill so much as the Bill that they were promised by all three parties and which they very much want—a Bill to give them a referendum on our EU membership itself.
European Council Decision: EUC Report
Lord Pearson of Rannoch Excerpts(13 years, 8 months ago)
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Lord Lamont of Lerwick
My noble friend, my right honourable and noble friend, as he always is and always will be.
As the noble Lord, Lord Harrison, mentioned, at paragraph 6 of the report the Select Committee commented—admittedly, it was talking about the EFSM rather than the ESM—that it did not conflict with the no-bailout provisions in the original Maastricht treaty, now incorporated in the TFEU. Of course, I know only what I read in the report about how it was argued by witnesses before the committee that that did not constitute a bailout because the EFSM did not assume responsibility for the debts. The same arguments must arise with the ESM.
Does the Minister seriously, with a straight face, believe that that does not constitute an infringement of the “no bailout” provisions? It seems extraordinary to say that just because loans are being extended, if there is a rescheduling of debts, that does not constitute a bailout. I do not think that that is what the Germans had in mind at the time, when they argued against bailouts and for a “no bailout” provision in the Maastricht Treaty. Bear in mind that the new facility, the ESM, will, like the EFSM, issue securities which will be guaranteed by the member Governments of the EU. I know that this is a sideshow for our Government, but it is extraordinary to describe that as not conflicting with the “no bailout” provisions.
The second question I want to ask my right honourable and noble friend is more directly germane to the UK. When the German Government agreed to support the ESM, part of the package they insisted on, from what I read in the newspapers, was something called the competitiveness pact, which covered a whole range of policies including: the indexation of wages as applied to countries such as Belgium; the retirement age; and having a uniform system of corporate tax. All that was put forward as part of a quid pro quo that the German Government wanted in exchange for agreeing to the ESM, to which there was some resistance on the part of the German public.
As my right honourable and noble friend may have noticed, fears have been raised in the Economist magazine that those provisions could have an impact wider than the eurozone and might affect us and other non-euro members of the EU. I entirely support the Government’s policy of allowing what is happening with the establishment of the ESM to go ahead; for us to have nothing to do with it but to allow it to go ahead; but I am concerned by the points made by the Economist about how that could spill over into measures that would have an effect on competition and the competitiveness of the rest of the EU. The magazine argued that the competitiveness of the whole might be undermined by protectionist measures taken under the rubric of the competitiveness pact. I hope that my right honourable and noble friend follows my point. I would like to be assured that that is not the case. I would like to be told how the competitiveness pact will be given legislative effect and how we will ensure that it does not have adverse repercussions on us, and other countries not in the eurozone.
Lord Pearson of Rannoch
My Lords, it will come as no surprise to your Lordships that I rise to speak against the Motion. The heart of the Government's case is that it is in our national interest to help the countries in the eurozone, so we should not withhold our consent to the proposed European stability mechanism. To justify that, the Government even trot out the tired old propaganda about half of our trade being with the eurozone, which is irrelevant nonsense, as I have often pointed out.
The Government are really asking us to agree that the euro should be propped up, which is a very different and risky thing to do. I say that because the euro is so badly designed that it may be un-prop-up-able, certainly in the long term, probably in the medium term and possibly, if one looks at what is happening now in Portugal—not to mention Greece, Ireland, Italy and perhaps Spain—in the short term. The euro's main design faults, as some of us have been trying to point out since before it was born, are that it is a currency area without a federal budget. There is no mechanism for sending support from rich areas in the zone to the poor areas. Its different economies also suffer from a single interest rate and exchange rate with the results we are already seeing in the countries I have mentioned.
The Government’s answer to that in this Motion tonight seems to be that there is nothing to worry about because this new ESM means that the poor old Germans will pay and so will the French, the Dutch and the other countries that already donate to keep the whole unfortunate project of European integration afloat. The question is: will they? For how long? How much? Even if the cosy European political class thinks it is all a splendid idea, what about real people? What about the massive public protests in Portugal over the weekend and those we have seen in Greece? What about Marine Le Pen in France? Indeed, what about UKIP in the recent Barnsley by-election? [Laughter.] Well, I had to put that plug in.
What about another thing? This is a question to the Minister. What about the vote in the German Bundestag last Thursday, when five out of the six main parties gave their consent to the ESM but only with some strings attached? I know this is only a European Parliament, which is made irrelevant, as we know, under the project of European integration. It is not the European Union, but nevertheless, those strings are important. They included strengthening the stability and growth pact, guaranteeing the independence of the European Central Bank, guaranteeing that the EMS would be activated only in emergency cases, a restructuring procedure that would include private creditors and a guarantee that the eurozone would not turn into a transfer union. This last string looks something like shutting the stable door to me, but perhaps the Minister will care to opine. Does the ESM in effect set up a transfer union in clear breach of Article 125 or does it not?
The noble Lord, Lord Harrison, agreed with the Government that it does not breach Article 125, so perhaps it is worth putting on the record, very briefly, the key part of Article 125, which states:
“The Union shall not be shall be liable for or assume the commitments of central governments … A Member State shall not be liable for or assume the commitments of central governments”.
I agree with my noble friend—if I may call him that—Lord Lamont. Of course this does that. At the very least, even for Article 122, so roundly abused just before the present Government came to power, which was designed to help out with natural disasters and things like that, surely a loan which is not repaid becomes a commitment. Here with this ESM, we are in the clearest possible terms breaching Article 125. I would like the Minister to tell us: are we are helping to setting up a transfer union or are we not?
The Bundestag’s third condition—that the ESM should be used only in emergency cases—also looks a bit optimistic. It reflects the proposed additional paragraph to Article 136 which states that the ESM will be activated only if it is indispensable to save the stability of the euro as a whole. I think the Minister told us that this detail has not yet been worked out. We are voting for something that we do not know how it will work. Can he tell us who or what will decide when the use of the ESM has become indispensable? Will it be the Council, in which we sit, and if so will we have a vote, or will it be the Commission and/or the central bank? Will the IMF be involved, which again concerns us? In short, can the Minister tell us how the new European stability mechanism will be activated?
Lord Newby
My Lords, it is always a great pleasure to follow the noble Lord, Lord Pearson of Rannoch, because I always think that debates in your Lordships' House are much better when we are not all agreeing with each other. He wants the euro to fail. We on these Benches want it to succeed, and therefore we support the Motion before us this evening. Without having a huge discussion on the history of the euro, it is perhaps worth reminding ourselves that the euro has survived the worst financial crisis certainly in our lifetimes, and has survived many naysayers over the past two or three years who very confidently and regularly predicted that it was about to collapse. It is quite clear that the euro is not going to collapse and that the eurozone is going to continue. Indeed, it is likely to be strengthened as a result of the decisions which are currently being finalised.
It is one of the long-standing features of our view of the EU and the euro that at every point they were about to collapse and, indeed, that the European venture was about to stall, and at every point it has moved forward in its peculiar but almost inevitable way. There was a typical example of this attitude just last week when the FT, reporting on the eurozone summit on this mechanism, had as its headline “Leaders cut surprise deal on key reforms”. The history of European development has been leaders predictably cutting surprise deals when nearing a deadline, which is exactly what has happened here.
I do not intend to attempt to dissect the speech of the noble Lord, Lord Pearson, in great detail, but I point out to him that member states are not donating anything to anyone via this mechanism. The Irish are paying 6 per cent on these loans and are grumbling mightily about them, so just as the British Government are getting a good return on the loans that they are making, member states that are making loans under this mechanism will be getting a pretty good return.
Lord Pearson of Rannoch
My Lords, I did not suggest that this Government were donating to any other member state through this mechanism; I merely pointed out that we donate generally to the coffers of the European Union—to the tune this year of £17.6 billion gross and £8.3 billion net. That is net cash that we are sending to Brussels and that goes down the drain there—a figure, I might say, that we are struggling to cut from our own public expenditure.
Lord Newby
My Lords, I apologise to the noble Lord. I misheard him. I distinctly wrote down that he said that a donation was involved in this process.
My one question to the Minister springs from my concern about the way in which the eurozone is developing, which is simply that the UK’s role in relation to it is extremely strange. We are obviously not part of it, so we are not in many of the meetings. Yet from time to time we are allowed to have a say. What worries me is that with the passage of time that say gets less and less over a whole raft of economic decisions across the EU. In the current exercise, we were allowed to help in the design of the ESM, which presumably means that Treasury officials went to meetings to talk about how it was going to work. What worries me is that, once it is established, those Treasury officials will be told that they have been extremely helpful, that their advice has been most valuable and that they can now go back to London and let the rest of the eurozone implement the policy. As the noble Lord, Lord Lamont, has pointed out, there are a whole raft of secondary consequences for the competitiveness pact, which will undoubtedly have an impact on the UK and on which, as far as I understand it, we will have no say at all in the future.
Will the Minister explain whether, once the ESM is established, there will be any further role for the UK Government and their officials in the design of the conditions that might be required or suggested from time to time to apply in particular cases when member states are being bailed out? These changes could be extremely worrying, not necessarily because they or the conditions are bad in themselves but because, although we are affected by them, we will have had no say in the way in which they are put together.
Lord Howell of Guildford
For the obvious reason that, in order to go ahead with the design of the ESM, there has to be first this Motion and then the alteration of the treaty, which under our new provisions of the EU Bill will also be debated in this House. We have to start the process off. If the proposition is that we cannot start until we know everything and that we are not going to know everything until we start, the noble Lord is asking me to go around in circles. That is often the fate of those in government, but in this case I prefer to begin to proceed on a process. Of course, I cannot stand here and say that what is going to emerge for the ESM and members of the eurozone will all be wonderful and work perfectly and that the eurozone will be happy for ever. The noble Lord could not reasonably expect me to be able to say that. I have no idea, as there are major issues of a geopolitical, political and economic nature lying ahead for the organisation of a financial structure for the eurozone, and none of us can be dead certain how these things will turn out. What one can say is that this is a move in the direction of trying to stabilise the eurozone, which the Government believe is in the interests of the United Kingdom. The noble Lords, Lord Pearson of Rannoch and Lord Stoddart, took different views, but that is what we believe and that is the Government’s position.
Lord Pearson of Rannoch
The Minister is confirming what the noble Lord, Lord Eatwell, said and what I asked him in my few remarks. We are being asked to agree something when we do not know what it will be. Why cannot we agree to the next phase going ahead and then make a final decision when we know what we are talking about? Why cannot we do it that way around?
Lord Howell of Guildford
Perhaps the noble Lord has not understood. That is exactly what your Lordships are being asked to do—to go ahead with the next phase. The Motion is required under the Lisbon treaty legislation; there will be a full debate on the new primary legislation, which we will start debating tomorrow. This is the next phase. The alternative is obviously to stand pat and do nothing, which the Government believe very strongly would be a serious and damaging step, which might lead, although I cannot guarantee it, to very serious damage for this country. So it seems right to take the next step forward. That is what both Houses of Parliament have been asked to do in order that the Prime Minister can take the necessary measures at the European Council later this week. Noble Lords are quite right—I said next week but I meant this week.
One or two of the points that have been raised are complex and important. The noble Lord, Lord Harrison, referred to the excellent Select Committee report which confirmed a number of the points that I have made, including the very important one that Article 122(2), which is the one governing the EFSM, will no longer be used. That is just as well because it had a liability for the UK.
My noble friend Lord Lamont of Lerwick asked two questions. The first was on whether Article 125 was compatible with having no bailout. He asked whether I, with a straight face, could make various assertions on that matter. I will give him what is in the brief before me, which has some strong validity. Article 125 of the treaty provides a clear assurance that no member state shall receive a bailout. However, it does not preclude the EU or member states from providing loans to one other. The EU’s balance of payments facility has already provided medium-term financial assistance to a number of member states. Article 2(1) of the EFSM regulation makes it clear that the financial assistance it envisages is strictly confined to either a loan or a credit, so that would need to be paid back. That is the explanation. I am a little worried about the straightness or otherwise of my face, yet that makes reasonable sense to me. It has been a matter of lively debate in other countries, such as in the Bundestag, but that is the answer that I have to his question.
Lord Pearson of Rannoch
My Lords, surely the Minister must agree that when a loan is not repaid it becomes a commitment?
Lord Howell of Guildford
All I can say is that this is how the debate has gone and these are the decisions that have been taken by those in the eurozone, which does not include us, who decided to go ahead and move from the EFSM to the ESM. The noble Lord has a different opinion of the financial aspects and is a financial expert of no small degree, so he may be right. However, that is not the view taken by the German Government or by the other Governments of the eurozone area.
My noble friend Lord Lamont also asked about the competitiveness pact. I can tell him that the latest draft of the pact makes it clear that:
“The Pact will fully respect the integrity of the Single Market”.
I am then advised that non-eurozone countries—such as us, among others—have been invited to join the pact and that we are assessing whether we should do so. I add that many of these points tonight point in the same direction and that we are really getting into the issues which we will be discussing on the new EU Bill tomorrow, when we shall have its Second Reading.
Libya: Bribes
Lord Pearson of Rannoch Excerpts(13 years, 8 months ago)
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Lord Pearson of Rannoch
My Lords, would the Minister like to reconsider that answer? Perhaps the noble Lord, Lord Davies of Stamford, would prefer that situation—anything to get at what he calls bribery.
Lord Howell of Guildford
I do not think that that is worth a further comment. We all recognise the need, in a desperate situation, for large payments to be made. I think that the noble Lord and everyone else appreciates that that was the need; that was the requirement; we had to get people out.
EU: Repatriation of Powers
Lord Pearson of Rannoch Excerpts(13 years, 11 months ago)
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Lord Howell of Guildford
My Lords, the acquis obviously embodies an accumulation of powers. We are now in the 21st century and I suppose that we would all wish to see, if I may use a domestic analogy, a bit more localism in the management of our affairs. However, we are reviewing the situation. The work is at a fairly early stage and I cannot make any further detailed comments on that matter now.
Lord Pearson of Rannoch
My Lords, will the Minister not come clean and admit that not a comma can be changed in the treaties, nor can the smallest power be repatriated, without the unanimous consent of all 27 member states, and that therefore the repatriation of powers is really not possible?
Lord Howell of Guildford
I understand exactly the noble Lord’s concern on this, but I think that he is being a bit defeatist. It seems to me that there is a very widespread will throughout the European Union to reform it and indeed, if I may borrow a phrase, to make it fit for purpose in the 21st century. That certainly involves a sensible pattern of competences between the nation member states and the central institutions. Therefore, I think that, by gloomily saying that nothing can happen until everyone agrees, the noble Lord is taking a very negative approach to an area where European reform is perfectly possible.