EU: Economy

Lord Sassoon Excerpts

Wednesday 2nd November 2011 Lords Chamber

[Lord Dykes]

To ask Her Majesty’s Government what conclusions they have reached from the discussions of European Union Finance Ministers in Luxembourg on 4 October concerning the case for member states to work together to solve their current economic problems.

[The Commercial Secretary to the Treasury (Lord Sassoon)]

My Lords, the Government support the euro area’s commitment to ensure financial stability of the euro area. A comprehensive and sustainable solution is urgently needed and is in the UK’s interest. This can be achieved only by the euro area working closely together. The Government also recognise the urgent need to boost growth across the EU and are pushing completion of the single market, promotion of trade, reduction in regulation and greater innovation.

[Lord Dykes]

My Lords, I thank the Minister and the whole Government for having shown steady and firm solidarity with our eurozone partner countries and for their strenuous efforts to solve current financial and economic problems. Does he agree that such a firm stance must be maintained to stop deep market panic despite the monumental shock of the Greek referendum decision?

[Lord Sassoon]

I am grateful to my noble friend for recognising the constructive role which the UK Government have played in pushing forward the many strands of important discussion in the EU at the moment. I indeed agree that the agreement signed last week has to be delivered by all member states, including Greece. We will be working hard to play our part to that end.

[Lord Liddle]

Does the Minister agree that, in this very grave moment of crisis for Europe and for Greece, we should be urging the Greeks to recognise that, for all the inevitability of hard and painful times that lie ahead for them, it is the eurozone that is forgiving half their debts, rescuing their banks and providing the financial support to keep their economy afloat? Should the British Government not hold out a hand of friendship to Greece, for whose democracy we have a proud historical record of support, and not indulge in arrogant lecturing by a Government whose economic policies are leading to depression in this country?

[Lord Sassoon]

My Lords, we hold out a hand of friendship to all our EU partners and to many other countries, but it is for Greece to make its own decisions. I am not going to lecture the Greeks, but it is clear that all parties to the deal last week have to deliver on their commitments.

[Lord Higgins]

My Lords, is it not high time that the usual channels got together and arranged for a debate in this House on the crisis in the eurozone, since we have had no opportunity other than on Statements and Questions to pursue the matter so far? In particular, should we not have some views expressed on the contingency plans which need to be made should a country leave the eurozone?

[Lord Sassoon]

My Lords, without wishing to encourage a huge rush of additional speakers, we already have a decent number of very interested and expert noble Lords down for a debate on Europe tomorrow. Indeed, this House is taking the matter very seriously.

[Lord Reid of Cardowan]

My Lords, is it not obvious to all but the most blinkered zealot that, whether the Greeks default or not, in the medium to long term the only prospect of survival for the eurozone—even that is not guaranteed—is with such a centralisation of political and fiscal ancillary powers that we would effectively have created qualitatively two different European structures? Will the Government enlighten us on what contingency planning they are making for the day that will inevitably come when that decision or those decisions have to be made?

[Lord Sassoon]

My Lords, I do not accept the very simplistic idea that we are headed for a two-speed Europe. There is already a variable geometry in Europe in other areas apart from the euro, such as justice and home affairs, where there are different arrangements for certain member states. The critical lesson out of all this is that the UK must stick to its own fiscal deficit reduction policies because it is those which are giving us the benefit of 10-year interest rates today at 2.2 per cent, whereas countries such as Italy, which had interest rates very similar to ours before the financial crisis, have interest rates not at 2.2 per cent but at 6.2 per cent. So we must stick to keeping our own house in order.

[Lord Pearson of Rannoch]

My Lords, further to the question put by the Minister’s noble friend Lord Higgins, have the Government given any thought to the cost of returning first Greece and in due course the other crippled economies of the eurozone to their national currencies and, if necessary, supporting that transition with some variation of the Marshall plan? Have they thought about that concept, compared with continuing to throw unknown trillions at a project which cannot be saved?

[Lord Sassoon]

My Lords, the first thing to understand is that the UK is not part of the stability mechanism that the eurozone is putting in place, and we will not contribute to specific bailouts. On the other hand, the eurozone takes about 40 per cent of our exports and it continues to be the principal interest of the UK Government to make sure that the eurozone and the whole of the EU prosper and grow, to the benefit of our own economy.

[Lord Grocott]

Could the Minister spell out the difference between a variable geometry Europe and a two-speed Europe?

[Lord Sassoon]

My Lords, I think that I have already done so. The two-speed Europe that people seek to paint is one between the eurozone and the rest, but thanks to the work of the Prime Minister at the 23 October Council, the very important principle was accepted that those matters which relate to all EU members and the whole of the EU, such as the single market, will of course continue to be the province of the EU 27. That is the critical acceptance which has been made by the Council and the Commission at the prompting of the Prime Minister.

[Lord Collins of Highbury]

NHS: Private HealthcareQuestion3.22 pmAsked By To ask Her Majesty’s Government whether general practitioner practices are permitted to advertise their own private healthcare services using the NHS logo.