Procedure of the House

Lord Strathclyde Excerpts

Tuesday 24th July 2012 Lords Chamber

[Baroness Royall of Blaisdon]

I apologise for intervening on this issue, but I wish to say something. I address my remarks to the noble Lord the Leader of the House rather than to the Lord Chairman. In view of the fact that the noble Lord, Lord Green, is going to be on television this evening and that he has written a letter to Mr Chris Leslie in the House of Commons, I thought it pertinent to raise this matter on the Floor of the House.

As a matter of procedure, the noble Lord the Leader of the House yesterday told your Lordships’ House in relation to the noble Lord, Lord Green of Hurstpierpoint:

“No Minister needs to be accountable to Parliament for their previous career”.—[Official Report, 23/7/2012; col. 482.]

However, in a letter to my honourable friend the shadow Financial Secretary to the Treasury, the noble Lord, Lord Green, does precisely that in giving, as a government Minister in an official letter from a government department, his views on HSBC and what he described as the “failures” of the bank, about which he says, “I share that regret”. If the noble Lord, Lord Green, can make that kind of point in a government letter—let alone what he might say in an interview on Sky television at 7 pm this evening—he should come to this House and make those points here. I therefore invite the Leader of the House, in the light of the actions today of the noble Lord, Lord Green, to make arrangements for the noble Lord, as a Minister and a Member of this House, to take the opportunity to come to this House tomorrow to dispel the questions that are being posed about his ministerial role.

[The Chancellor of the Duchy of Lancaster (Lord Strathclyde)]

My Lords, I think that it is worth replying to this. The noble Baroness the Leader of the Opposition was kind enough to give me notice that she would raise this issue. There are two accusations against my noble friend Lord Green. The first is that he has written to Mr Chris Leslie, who is a Member of the House of Commons. The only reason why my noble friend Lord Green has written to Mr Leslie is because Mr Leslie wrote to him and he has simply replied. That strikes me as being entirely the right and correct thing to do.

The second accusation is that my noble friend has not come to this House to answer questions. The reason why my noble friend has not come to this House to answer questions is because none has been put to him on this subject.

The noble Lord, Lord Foulkes, made much of the table of attendance and referred to my noble friend Lady Anelay. However, she happens to be the government Chief Whip, and if she was not here practically every day, I would want to know why. Incidentally, I also want to know why the Minister for Trade should spend all his time in here when his job is to do his best, banging the drum for British business—as the noble Lord, Lord Jones, used to remind us—rather than coming here. How many questions has the noble Lord, Lord Foulkes, put down in the past 12 months to my noble friend Lord Green on matters of trade? I shall check the record later.

[Lord Foulkes of Cumnock]

If the noble Lord the Leader of the House would care to check, he will find that the noble Lord, Lord Jones, attended here regularly. He answered question after question. Not only did he do so, but so did the Secretary of State, the noble Lord, Lord Mandelson, who also attended regularly. The noble Lord, Lord Green, is the senior Minister from the Department for Business, Innovation and Skills in this House, but who has to stand in? The noble Baroness, Lady Wilcox, who comes very high in the table, gallantly stands in regularly to answer these questions; and if she is not able to do it, the noble Lord, Lord De Mauley, stands in. However, we never see the noble Lord, Lord Green. I do not think that the noble Lord the Leader of the House understands that he is the Leader of the House, not of the Conservative Party. He is responsible for the whole House. It is a grave discourtesy for a Minister never to appear to turn up. He is not just responsible for trade and investment; he is the main Minister in that department, and he should be here answering questions.

[Lord Strathclyde]

I will not continue this for very much longer. All I can say is that if the noble Lord wants to put down questions on trade and investment, my noble friend Lord Green will be here to answer them.

[Lord Barnett]

My Lords, while the noble Lord is here and answering questions, I hope he does not mind my saying this, but I understand that the noble Lord, Lord Green, should have made from BIS the Statement on loan guarantees. For some reason, he was not here, although I gather he was in the House. Could the noble Lord inquire into why that happened? I would rather that the noble Lord, Lord Green, had answered, given that he was the Minister concerned.

[Lord King of Bridgwater]

Can we get a better understanding of this issue? My own memory goes back to two excellent Ministers of Trade: Cecil Parkinson, who is now a Member of this House, and Richard Needham—both of whom will be familiar to many Members of this House. I was rude to them if I ever saw them, because their job was not to be here. At a time when we needed trade and exports, they needed to be out and about promoting British business. The other House respected the fact that they had to lead delegations and had greater impact outside. The more they did, the better they did it. They were very effective Ministers of Trade at a rather successful time for the British economy. If ever we needed a Minister of Trade to be active overseas, it is now. I thought this House would appreciate that.

[Lord Strathclyde]

My Lords, my noble friend puts it extremely well. In answer to the noble Lord, Lord Barnett, a Written Ministerial Statement on the loan guarantee scheme was made by my noble friend Lord Sassoon because it was a Treasury matter. The noble Lord was able to ask him a Question a few minutes ago.

[The Chairman of Committees (Lord Sewel)]

My Lords, it seems so long ago, but if I remember correctly the noble Lord, Lord Foulkes, began by commending the report. I thank him for those very few words on the report. He raised issues that have been dealt with by the Leader of the House. The only thing I should say is that if anyone wishes to take these matters further in light of the Procedure Committee, they can always write. I do not think that any points, let alone points of substance, have been raised on the content of the report, which makes a number of important advances in how we enable people with disabilities to contribute fully to the business of this House. I commend the report to the House.

HSBC: Lord Green of Hurstpierpoint

Lord Strathclyde Excerpts

Monday 23rd July 2012 Lords Chamber

[Baroness Royall of Blaisdon]

My Lords, I beg leave to ask a Question of which I have given private notice.

[The Chancellor of the Duchy of Lancaster (Lord Strathclyde)]

My Lords, Her Majesty’s Government have every confidence in my noble friend Lord Green ability to fulfil his ministerial duties. His experience, expertise and enthusiasm provide great benefit to the UK’s international profile and to the support that UK Trade and Investment provides to British businesses.

[Baroness Royall of Blaisdon]

My Lords, I am grateful to the Leader of the House for that Answer. However, as the noble Lord will be aware, questions have been asked about the present ministerial role of the noble Lord, Lord Green, following the US Senate committee’s findings.

Paragraph 1.2 of the Ministerial Code, which sets out the responsibility of Ministers to Parliament, says that:

“Ministers should be as open as possible with Parliament and the public, refusing to provide information only when disclosure would not be in the public interest”.

Given that obligation, will the Leader of the House ask the noble Lord, Lord Green of Hurstpierpoint, to come to your Lordships’ House to place on record what he knew and when about the matters investigated by the US Senate committee, including what steps he took to deal with them? Would such a move not give the noble Lord, Lord Green, the opportunity to dispel once and for all the questions being asked about his present ministerial role?

[Lord Strathclyde]

My Lords, I congratulate the Leader of the Opposition. I know that she has been trying to find a PNQ to put to the House and she has managed to do so. I am very glad to be able to respond on behalf of Her Majesty’s Government.

There is no urgency in this matter. The investigation started more than two years ago. The report in question was published two weeks ago. There was no evidence of personal wrongdoing of my noble friend; indeed, there was no personal criticism whatever of my noble friend. The investigation is ongoing. As for ministerial accountability, my noble friend Lord Green is accountable to this House—to Parliament—for the work he does as a Minister. However, many Ministers have had previous careers. No Minister needs to be accountable to Parliament for their previous career, only for what they are doing as a Minister.

[Lord Butler of Brockwell]

My Lords, I declare an interest as a non-executive director of HSBC during the time when the noble Lord, Lord Green, was chief executive officer and chairman. Is the Leader aware that when I was advising the Prime Minister on calls for ministerial resignations, I drew a distinction—which I think is widely accepted—between accountability and responsibility? While it may be the case that the chairman and chief executive officer of a major international company is accountable for everything that happens in that company, there is no possible way in which they can be responsible for everything that happens in a worldwide group of the size of HSBC.

[Lord Strathclyde]

My Lords, with all his experience and knowledge—not just as head of the Civil Service and Cabinet Secretary but having had a more commercial career since he left—the noble Lord, Lord Butler of Brockwell, has brought a lot of wisdom and good sense to this debate, on which we should all reflect.

[Lord Kinnock]

My Lords, since the Leader of the House has told us that the work of the noble Lord, Lord Green, is of benefit to the United Kingdom’s profile—the words he just used—does he think that the accountability of an individual in a very senior position in government or business ceases when that individual changes post? Does he not think that it would benefit the UK’s profile to ensure that a Minister rigorously adheres to the wording of the Ministerial Code, as just spelt out by my noble friend? Further, does he not think that the ethics of business require that a Minister who has the opportunity and the right to come to this House to explain themselves should do so?

[Lord Strathclyde]

My Lords, I do not disagree at all with what the noble Lord says about the ethics of the industry in which my noble friend was involved. In fact, only last week, this House set up a special Joint Select Committee to look at ethics and many other practices in the banking industry. Surely that is the point. If a Select Committee of this House or another place wishes to ask my noble friend questions, it should do so. My purpose is to reflect on my noble friend’s role in government and to answer on behalf of Her Majesty’s Government.

[Lord Cormack]

My Lords, does my noble friend agree that anyone who knows the noble Lord, Lord Green, could not doubt his total integrity for a moment?

[Lord Strathclyde]

My Lords, I agree with that but I wholly accept that questions need to be asked—and are habitually asked—of a Minister to make sure that he is accountable to Parliament. As I said in my reply to the noble Lord, Lord Kinnock, if a committee of Parliament wishes to put questions to my noble friend, it is entirely free to do so.

[Lord Grocott]

My Lords, perhaps I can remind the Leader of the House of a report with which he will be, no doubt, almost word perfect: the report of the Leader’s Group on Working Practices, which made a number of recommendations. Of course, the group was established by the Leader for the Leader. Recommendation 3 of that report—which, I remind him again, was published more than a year ago in April last year—said:

“We … recommend that there should be a monthly question time dedicated to questions on House of Lords matters addressed to the Leader of the House”.

Perhaps I may helpfully suggest that both today’s Question and indeed the very important one raised last week by my noble friend Lord Barnett could be handled were the Leader to accept that simple, unanimous recommendation by a committee that was set up at his instigation. I urge him to act on that recommendation as soon as possible.

[Lord Strathclyde]

My Lords, from memory, I do not think that there has been a single Question put to me in my capacity as Leader of the House in the past 12 months. That rather leads me to believe that there is no great demand for a monthly Question Time session for the Leader. There are perfectly good methods for asking me questions and noble Lords should use them if they wish to.

[Lord Hughes of Woodside]

My Lords, from a rather different view, perhaps, I query what was said by the noble Lord, Lord Butler. Surely accountability and responsibility cannot simply be divided one from the other—it is not as sharp as that. Accountability and responsibility go hand in hand and no one should doubt it.

[Lord Strathclyde]

My Lords, my noble friend Lord Cormack said that no one should challenge the integrity of my noble friend Lord Green, and I agree with him. But if it comes to a choice between the noble Lord’s view of what is responsibility and accountability and that of the noble Lord, Lord Butler of Brockwell, I will go with the noble Lord, Lord Butler of Brockwell.

[Baroness McIntosh of Hudnall]

My Lords, I personally—along with most of the House, I feel—am in no position and would not wish to challenge the integrity of the noble Lord, Lord Green. However, does the Leader of the House agree that perhaps there would be less question about his conduct over the issue of HSBC were the House to see him more often answering questions that relate to his ministerial responsibilities? It may have something to do with his relative unfamiliarity to Members of the House that they are perhaps more sceptical than they should be.

[Lord Strathclyde]

My Lords, as a Minister for trade, my noble friend of course spends a great deal of time overseas. Since he was appointed, he has travelled to 42 countries and visited 73 cities. In his role as Minister of State for Trade and Investment, he has answered a total of 72 Parliamentary Questions, including two Oral Questions out of three that he could have answered. The response to the point raised by the noble Baroness is that if more Questions on trade and investment were put down, I am sure that my noble friend would be very happy to come and answer them.

[Baroness Royall of Blaisdon]

My Lords, I thank the noble Lord for his answers, but perhaps I may say that I found his initial response to my Question slightly patronising, albeit not in terms of the substance. I table PNQs when I believe that there is a matter of accountability which is of interest to this Parliament as a whole—we are the only House of Parliament sitting at the moment—and when I believe that it is of importance to this nation. I do not do so for personal gratification.

[Lord Strathclyde]

My Lords, if the noble Baroness felt that I was in any way seeking to patronise her, I apologise fully.

Business

Lord Strathclyde Excerpts

Thursday 19th July 2012 Lords Chamber

[Lord Barnett]

While the Leader of the House is here, I feel that I should bring to the attention of the House a very serious matter that has arisen. At Question Time yesterday, I asked a question of the Treasury. The noble Lord, Lord De Mauley, who is normally very honourable, told me that he could not reply to my question and would do so in writing. We did not know at the time that a Written Ministerial Statement was being made by the noble Lord, Lord Sassoon. The Leader of the Opposition asked a few days ago that, while this House is sitting as part of this Parliament, any major Statement—this was a serious Statement on infrastructure and loan guarantee schemes—be taken here. It was taken as a Written Ministerial Statement while I was asking an oral question. It really is quite outrageous and I hope that the Leader of the House will be able to assure us that it will not happen again.

[The Chancellor of the Duchy of Lancaster (Lord Strathclyde)]

My Lords, the noble Lord, Lord Barnett, has been a Member of this House for a very long time indeed. The noble Lord knows that it does not have points of order and that if he needs to raise a question, it has to be on a relevant Motion. It is a gross discourtesy to the Lord Speaker for the noble Lord not to have put down a PNQ if he felt it was appropriate. It is also a discourtesy to the House for him to break the rules in this way. If the noble Lord does not know what the rules are, then I urge him to take advice from the Clerk of the Parliaments, who no doubt will provide an induction course for him.

[Noble Lords]

Oh!

[Lord Barnett]

My Lords, I have indeed been a Member of this House for nearly 30 years and have never, I hope, done anything discourteous in any way. I was putting an oral question on the specific issue and at the same time a Minister was putting down a Written Ministerial Statement. This was on something rather important, to say the least, because the Prime Minister—and even his deputy was with him—was making this major statement about loan guarantees. The Leader of the Opposition asked specifically that those kinds of statements should be made here; she never said written ones. What is wrong with my asking now that it should not happen again?

[Lord Strathclyde]

My Lords, what is wrong is that the noble Lord is breaking the rules of the House by not raising it at a relevant time on a Motion that is on the Order Paper.

Parliamentary Commission on Banking Standards

Lord Strathclyde Excerpts

Tuesday 17th July 2012 Lords Chamber

Moved By

[Lord Strathclyde]

1. That the Commons message of 16 July be considered and that a Committee of five Lords be appointed to join with the Committee appointed by the Commons as the Parliamentary Commission on Banking Standards, to consider and report on:

(a) professional standards and culture of the UK banking sector, taking account of regulatory and competition investigations into the LIBOR rate-setting process;

(b) lessons to be learned about corporate governance, transparency and conflicts of interest, and their implications for regulation and for Government policy;

and to make recommendations for legislative and other action;

2. That, notwithstanding the provisions of Standing Order 63(2), the following members be appointed to the Committee:

The Lord Bishop of Durham, Baroness Kramer, Lord Lawson of Blaby, Lord McFall of Alcluith, Lord Turnbull;

3. That the Chairman of the Commission be appointed by the House of Commons;

4. That the Commission shall, except as provided for in this order, follow the procedure of a select committee of the House of Commons;

5. That the Commission have power:

(a) to send for persons, papers and records;

(b) to examine witnesses on oath;

(c) to appoint specialist advisers;

(d) to invite specialist advisers (including Counsel appointed as specialist advisers) to examine witnesses;

(e) to adjourn from place to place;

6. That the Commission have leave to report from time to time and that the Reports of the Commission shall be printed, regardless of any adjournment of the House;

7. That the evidence taken by the Commission shall, if the Commission so wishes, be published;

8. That the Committee appointed by the House of Lords have power to report to the House any decision of the Commission reached pursuant to paragraph 9 of the Commons resolution of 16 July;

9. That the Commission shall have power to appoint sub-committees to consider matters specified by the Commission within the terms of this order and a sub-committee shall have:

(a) the powers in paragraph 5(a), (b) and (e); and

(b) the power to invite specialist advisers appointed by the Commission (including Counsel appointed as specialist advisers) to examine witnesses;

10. That the quorum of the Commission shall be two members of each House;

11. That the quorum of any sub-committee shall be one member from either House; and

12. That the Commission shall report on legislative action no later than 18 December 2012 and on other matters as soon as possible thereafter.

Motion agreed, and a message was sent to the Commons.

Arrangement of Business

Lord Strathclyde Excerpts

Tuesday 17th July 2012 Lords Chamber

[Baroness Royall of Blaisdon]

My Lords, the House of Commons rises today, as we all know, and noble Lords may recall that, during the Jubilee Recess when this House sat, the Government announced changes to tax policy to the media rather than to Parliament—that is to say, to our House. I would be grateful if the Leader of the House could reassure noble Lords that when the House of Commons has gone into recess any policy announcements will be made to this House, while it is sitting, as we are a House of Parliament, rather than to the media first. We shall be vigilant with regard to any sneaky Statements that might come out.

I also take this opportunity to wish a very happy birthday to the Chief Whip, the noble friend of the Leader of the House.

[The Chancellor of the Duchy of Lancaster (Lord Strathclyde)]

My Lords, I am sure that the whole House will join in those very happy returns to the Captain of the Honourable Corps of the Gentlemen at Arms.

There is no desire on the Government’s part to produce any sneaky Statements at all when the House of Commons is not sitting. Of course, this House will be sitting next week and any Statements, Urgent Questions or PNQs will be taken in the normal way.

[Lord Grocott]

Will the Leader of the House undertake to inform the House of the additional cost that will undoubtedly be incurred as a result of this House sitting as though it were a unicameral system for a week now, then the Commons sitting for a fortnight as though it were a unicameral system in September, and then this House sitting again a couple of weeks after that? It undoubtedly means that we will be functioning less efficiently with all sorts of committees, which affect Members of both Houses, being unable to operate as they would when Parliament functions in the normal way. However, I refer specifically to the costs of the Houses sitting in a way that the Government now seem bent on, which I do not think is for the convenience of the House or of the public.

[Lord Strathclyde]

My Lords, that is most bizarre. The House has sat on different days from the House of Commons for decades, as far as I can remember. If there are any additional costs, I shall let the noble Lord know. I do not think that there will be; we are not sitting, overall, for more days than otherwise we would have been.

Business of the House

Lord Strathclyde Excerpts

Thursday 12th July 2012 Lords Chamber

Moved by

[Lord Strathclyde]

That the debates on the Motions in the names of the noble Lord, Lord Campbell-Savours, and the noble Baroness, Lady Rendell of Babergh, set down for today shall each be limited to two and a half hours.

Motion agreed.

Business of the House

Lord Strathclyde Excerpts

Thursday 12th July 2012 Lords Chamber

Moved By

[Lord Strathclyde]

That Standing Order 46 (No two stages of a Bill to be taken on one day) be dispensed with on Monday 16 July to allow the Supply and Appropriation (Main Estimates) Bill and the Finance Bill to be taken through all their remaining stages that day.

Motion agreed.

Business of the House

Lord Strathclyde Excerpts

Thursday 5th July 2012 Lords Chamber

Moved by

[Lord Strathclyde]

That the debate on the Motion in the name of Lord Jenkin of Roding set down for today shall be limited to three and a half hours and that in the name of Lord Higgins to one and a half hours.

Motion agreed.

Further Education Institutions and 16 to 19 Academies (Specification and Disposal of Articles) Regulations 2012

Lord Strathclyde Excerpts

Thursday 5th July 2012 Lords Chamber

Moved by

[Lord Strathclyde]

That the draft regulations be referred to a Grand Committee.

Motion agreed.

EU Council

Lord Strathclyde Excerpts

Monday 2nd July 2012 Lords Chamber

[The Chancellor of the Duchy of Lancaster (Lord Strathclyde)]

My Lords, this may be a convenient moment to repeat a Statement made by the Prime Minister about the European Council. The Statement is as follows.

“I am sure that the whole House will be deeply saddened by the death of three British servicemen in Afghanistan yesterday. These brave soldiers were demonstrating great courage to prevent Afghanistan once again becoming a haven for international terrorists and helping to keep us safe here in the United Kingdom. The suspected perpetrator is in custody and we will do everything in our power, with the Afghan national security forces, to ensure that justice is done. This tragic incident again demonstrates the very real risks that our soldiers face every day and we will learn all the lessons that arise from it. I know that everyone in this House will want to send their support to our brave troops and their families at this difficult time.

Turning to the European Council, Britain had three objectives at last week's European Council. The first was for eurozone members to take the urgent action needed to deal with the immediate crisis. The second was to secure a comprehensive growth package firmly focused on Britain's priorities and the third was to send a clear message to the rest of Europe about what Britain expects from the budget negotiations to come.

Under the previous Government, we could have been liable for financial support for these measures, as members of the EU bailout fund. But this Government have repatriated that power, so the British taxpayer is not involved.

On longer-term issues, eurozone members agreed important steps towards closer integration following a discussion of a report by the president of the European Council and others. It is vital for Britain—and for the strength and prosperity of the whole European Union—that they do this in the right way. I secured agreement that as this work goes ahead the “unity and integrity of the single market” will be fully respected. On the specific proposal of a banking union, I ensured that Britain will not be part of any common deposit guarantees or under the jurisdiction of any single European financial supervisor. I am very clear that British taxpayers will not be guaranteeing any eurozone banks and I am equally clear that, while we need proper supervision of our banks, British banks will be supervised by the Bank of England, not the ECB.

The original draft of the growth compact included a whole section on economic and monetary union which implied that a banking union might apply to all 27 countries. A number of countries worked to ensure that that whole section was removed.

We want a budget that is focused on growth not a focus on growth in the budget. EU members as a whole are €3.5 trillion more in debt now than when the last budget was negotiated and we have to face up to that tough reality. I made it clear that without the British rebate we would have the largest net contribution in the EU as a share of our national income. Without the rebate, it would be double that of France and almost one and a half times bigger than that of Germany. So the British rebate is not up for renegotiation. It is fully justified.

On foreign policy, the Council welcomed the EU oil embargo against Iran which came into force yesterday. On Syria, we called for united action by the UN Security Council to add more robust and effective pressure on Assad’s regime, including the adoption of comprehensive sanctions.

Europe is changing rapidly and fundamentally, and this presents real challenges for all countries. Those inside the eurozone have to face fundamental choices about whether to limit their national democracy and provide financial support to the weaker members, and like others outside the eurozone, in Britain we also face big choices too.

As Europe changes to meet the challenges of the eurozone, so our relationship with Europe will change too. There are those who argue for an in-out referendum now. I do not agree with that because I do not believe that leaving the EU would be best for Britain. But nor do I believe that voting to preserve the exact status quo would be right either. As I wrote yesterday, I do not believe that the status quo is acceptable. But just as I believe it would be wrong to have an immediate in-out referendum, so it would also be wrong to rule out any type of referendum for the future.

The right path for Britain is this. First, we must recognise that in the short term the priority for Europe is to deal with the instability and chaos. Secondly, over time we must take the opportunities for Britain to shape its relationship with Europe in ways that advance our national interest in free trade, open markets and co-operation. That should mean, as I argued yesterday, less Europe not more Europe: less cost, less bureaucracy, less meddling in issues that belong to nation states.

Thirdly, all party leaders will have to address this question. But it follows from my argument that far from ruling out a referendum for the future, as a fresh deal in Europe becomes clear, we should consider how best to get the fresh consent of the British people.

Finally, as I have said, as the eurozone moves to a banking union, we must ensure that Britain can take responsibility for sorting out its own banking sector. On the unfolding banking scandal here in the UK, we need to take action right across the board, introducing the toughest and most transparent rules on pay and bonuses of any major financial centre in the world, increasing the taxes banks must pay, ensuring tough civil and criminal penalties for those who break the law, and above all, clearing up the regulatory failure left by the previous Labour Government.

The British people want to see two things. They want to see that bankers who act improperly are punished and they want to know that we will learn the broader lessons of what happened in this particular scandal. On the first, the Serious Fraud Office is looking at whether there are any criminal prosecutions that can be brought, and it is using the full force of the law in dealing with this. On the second, I want to establish a full parliamentary committee of inquiry involving both Houses and chaired by the chairman of the Commons Treasury Select Committee. This inquiry will take evidence under oath, have full access to papers, officials and Ministers, including Ministers and special advisers from the previous Government, and it will be given, by the Government, all the resources it needs to do its job properly. The Chancellor will be making a full Statement, but this is the right approach because it will be able to start immediately, it will be accountable to this House, and it will get to the truth quickly, so we can make sure this never happens again.

I commend this Statement to the House”.

--- Later in debate ---

[Lord Strathclyde]

My Lords, perhaps I may clarify to my noble friend that there will be two Statements this afternoon, the second of which will be repeated by my noble friend Lord Sassoon, as is laid out on the screens, and will come immediately after Back-Bench time on this Statement.

As ever, I thank the Leader of the Opposition for her remarks. She asked plenty of questions and I shall try to deal with them fully. She expressed dissatisfaction at the Prime Minister having said that there should be an inquiry into banking and the LIBOR problem, because it was the wrong sort of inquiry. She said that her party would put down an amendment to a Bill before this House. She expressed disappointment with what the Government were doing, which is a pity, because I would have thought that one place where there is a good deal of expertise was in Parliament. To have a Joint Committee of both Houses looking at this matter, with Members of our Economics Affairs Committee sitting with their colleagues in the House of Commons, should surely be enormously welcome. It should also be able to respond quickly. We hope that it will get to work straightaway, call witnesses over the next few months and report by Christmas so that recommendations can be included in the Vickers Bill in the New Year. That seems to be an appropriate way forward.

The noble Baroness asked for our thoughts on Syria. She correctly recognised what a difficult situation it is. The situation remains grave, with hundreds of people dying every week. However, the Foreign Secretary was engaged this weekend in intensive talks in Geneva on a transition plan which included the Foreign Ministers of Russia, China, and other countries. The result is one step forward, which is worth having. We agreed with Russia and China that there should be a transitional unity Government in Syria, which should be made up of people from the present Government, the opposition, and other groups on the basis of mutual consent. It would of course exclude President Assad. We must now try very hard to bring this about. We are putting a great deal of energy into doing so, but nobody is under any illusions of just how complex all of this going to be, given the situation that exists in Syria.

The noble Baroness, the Leader of the House—

[Baroness Royall of Blaisdon]

If only!

[Lord Strathclyde]

Sorry, the noble Baroness the Leader of the Opposition, the former Leader of the House, also talked about the Europe of jobs and growth. She said that the Prime Minister could not deliver this in the United Kingdom, and asked why he therefore thought he could deliver it in Europe. That is to completely misunderstand what this Government have been doing, and, of course, to misunderstand quite deliberately. We want to rebalance the economy, with private sector growth taking the place of government deficits. We want prosperity shared across all parts of the UK. We want to become a world leader in advanced manufacturing and knowledge-based industries and services, and to remain the world’s leading centre for financial services. We have done this by cutting corporation tax, ensuring access to finance, dealing with the red-tape challenge, and many other brave and sensible pieces of action which will take the Government forward, from where we were under Labour’s misrule towards long-term growth and prosperity based on real jobs.

The noble Baroness asked about the European Patent Office. She said that it was not going to be based in London. This has been discussed and debated for over 23 years. It is an area in which Britain excels. The Council has decided that the patent office should be based in three parts of the European Union: in London, Paris and Munich. The most significant part of it as far as we are concerned—pharmaceutical and life science industries—will be based here in London. It will bring a turnover of over £100 million-worth in legal services into the United Kingdom.

Much of what the noble Baroness asked about concerned the referendum. I have believed for a long time that the real muddle on European policy lies in the party opposite, and not in our party at all. We said that an in/out referendum is not the answer right now, and we stick to that. A referendum on a choice between the status quo and coming out completely when Europe is changing would be the wrong choice. It would be a bad time to make a decision. Europe is changing a great deal, probably more so currently than it has done for very many years. Indeed, it is entirely right for my right honourable friend the Prime Minister to look at how we want to change our relationship with Europe, and as the end point becomes clear, to consult the British people either in a general election or a referendum. I regard that as a very strong position. If the Labour Party disagrees with consulting the British people, they should say so.

[Lord Dholakia]

My Lords, first, I welcome the sentiment expressed by the Leader of the House and the Leader of the Opposition about the death of the three British soldiers in Afghanistan. Our prayers and thoughts will remain with their families and friends.

I have two questions for the Minister. On the compact for growth and jobs, which will release €125 million for immediate investment, the noble Lord was broad enough to explain the area that may benefit Britain. Could he be more specific about what the real benefit to Britain will be from that money? Secondly, it is proposed that a group of eurozone members might pursue various measures, such as a financial transaction tax, through enhanced co-operation among themselves. If they do, will the Government ensure that Britain’s rights under the single market are maintained?

[Lord Strathclyde]

My Lords, my noble friend’s last point is crucial. There was real concern at the European Council and suggestions from other countries that a European banking supervisory system would be precisely that—for all the banks in Europe, including those in the United Kingdom. My right honourable friend the Prime Minister and others said that that should not and could not be the case, and we ensured that the final terms of the agreement ensured that British banks would not be a part of that but would continue to be regulated by the Bank of England. Within the eurozone area, it is of course entirely appropriate that they look at ways to improve banking supervision, ensuring deposits and working more closely together. That, too, should be welcomed.

As for growth, we are all pointing in the same direction. We want deregulation. We want a clearer completion of the single market, particularly in digital and energy. That will have an important impact on the European economy and, in particular, on the United Kingdom economy.

[Lord Hannay of Chiswick]

My Lords, does the Leader of the House accept my welcome that the lessons of last December seem to have been learnt on this occasion and that the Prime Minister has recognised that the right way to protect British interests is to stay at the negotiating table, not to reject any participation in negotiations? In my view, that is highly welcome.

As the Prime Minister begins to dance with wolves on referendum issues, does the noble Lord agree that it does not make much sense to parody the situation and the choice before us by talking about more Europe or less Europe? If we read the European Council conclusions, which I am glad the Prime Minister subscribed to, we see a great deal of more Europe in them in relation to the single market. There are references to patents, to the digital single market and to the single market in services, all of which require more Europe. It makes no sense at all to say that the British position is in favour of less Europe.

On Syria, does the Minister recognise that the Russian situation may not be one that we can work our way around? I am not criticising for one minute the attempt made in Geneva to achieve common ground, but it is doubtful whether that achievement is real or just apparent. If it is not real, it will surely be necessary to go to the Security Council to table a resolution imposing measures on the Syrian regime if it does not observe and honour the provisions of the Annan plan and put it to a vote, come what may. The only way you can find things out in the Security Council is by eventually putting it to a vote. If the Russians wish to veto it, they will do so, and that will be their responsibility.

[Lord Strathclyde]

I shall take those points in order. The noble Lord welcomed the fact that the Prime Minister wants to work together with his European partners. Of course, that has always been the case, including last December, when my right honourable friend was ready to support treaty change for the 27 in return for specific and practical proposals, which we put forward to safeguard the integrity of the single market. These proposals were not an opt-out for the UK, as some have suggested; they would have applied to the EU as a whole. However, other countries blocked them, and without those protections it was entirely correct that my right honourable friend used his veto.

Of course, there are some vital parts of the EU that have a positive impact upon the United Kingdom, and we should seek to preserve these. Equally, it is right for the Government to conduct a national audit of what the EU does and what the implications are for this country. Extensive preparatory work is progressing, and when that is complete we shall make a further announcement to Parliament.

As for Syria, I see entirely the force of what the noble Lord has said about putting down a UN Security Council resolution. It is, of course, a delicate matter. I do not think that the issue has advanced as far as that, but the option must be open to the Security Council to put forward a resolution.

[Lord Lawson of Blaby]

My Lords, is it not clear that the present situation in the eurozone is unsustainable, that it remains unsustainable despite the changes agreed with the European Council, and that sooner or later—sooner better than later—countries that are part of the monetary union will have to decide whether they are going to enter into a full-blooded political union or whether they should dissolve the single currency altogether? If the former, which I do not think it will be, there is no way this country can remain part of the European Union. If the latter, as I hope, and the single currency is dissolved, we can remain in the Union and I hope they will have learnt their lesson.

On the LIBOR scandal, I welcome a proposal to set up a Joint Committee of both Houses under the chairmanship of my excellent former special adviser. I am particularly glad that it will be a Joint Committee that includes Members from this House.

[Lord Strathclyde]

My Lords, on the first question, I do not know whether the eurozone is unsustainable. I do know that there is a crisis that needs to be resolved, and the sooner it is resolved the better. Our view is that at the end of last week a bold step was taken in the direction of trying to solve the crisis. Certainly, the financial markets liked it. Whether it is going to be enough, quickly enough, it is too early to tell. As the Government have said, there is a remorseless logic to how the eurozone operates, which is why we decided not to join it.

I am glad that my noble friend welcomes the Joint Committee on LIBOR and the banks. I think he is a member of the Economic Affairs Committee of this House, so he may well find himself a member of that Joint Committee, which would see a reversal of the roles between its chairman and him.

[Lord Barnett]

My Lords, could I clarify the Prime Minister’s position on an in/out referendum? My noble friend the Leader of the Opposition asked the question and the Minister did not seem to be clear in his answer. Is the Prime Minister’s position that he is opposed to an in/out referendum, full stop?

Could I also, I think, congratulate the Government? The Minister seemed to confirm what was reported in the Times last week, but which I did not see anywhere else, that the Government and the Prime Minister have agreed to give €1.3 billion to the European Investment Bank to help growth in Europe. It seems an odd thing to do, given that I would have thought that the Prime Minister’s primary consideration was to promote growth here. However, I would welcome such a proposition. Could the Minister confirm this?

[Lord Strathclyde]

First, my Lords, I thought I had made it pretty clear that the Prime Minister and the Government are not in favour of having an in/out referendum now. It is not the answer right now, but who knows? I would not support one, and I do not think that the Government would, because it is not the right choice to make. The right choice to make is that since Europe is in flux we should see where it ends up and where the relationship changes, if it does. We already have provision, agreed by Parliament, that when power moves from the United Kingdom to Europe there should be a referendum, so referendums should not concern us very much. However, if that relationship changes, perhaps the right thing should be to consult the British people, either in a general election or in a referendum.

As for growth, we were very much part of the group that called for a credible EU growth agenda. The European Council endorsed our growth priorities on Friday. For instance, we secured agreement for the immediate implementation of actions to eliminate unjustified barriers on services. This alone could add 1.6% to EU GDP over the next few years.

[Lord Ryder of Wensum]

My Lords, is not the use of “growth” incredibly mistaken in the context not only of my noble friend’s Statement but of the European Council’s conclusions, which I have before me? Indeed, the first paragraph of the Council’s conclusions states:

“The European Union will continue to do everything necessary to put Europe back on the path of smart … and inclusive growth”.

Perhaps my noble friend can explain the difference between growth and “smart … and inclusive growth”. Furthermore, I would be very grateful to know precisely what the Prime Minister’s definition of growth is, because I have been confused in recent weeks by his understanding of it. Growth in the long term in the European Union can be sustainable only by continuing to liberalise every country within it and by introducing supply-side measures. If my noble friend agrees that the Prime Minister accepts this principle, can he please let us know what supply-side measures the Prime Minister has been trying to persuade his European colleagues to implement in recent weeks?

[Lord Strathclyde]

My Lords, I, too, read those words from the conclusions of the Council’s meeting, which say:

“on the path of smart, sustainable and inclusive growth”.

I suspect that in different countries within the EU, it means rather different things. The conclusions go on to say that it should provide,

“a coherent framework for action at national, EU and euro area levels, using all possible levers, instruments and policies”.

It then directs the reader to the annexe.

That leads me to my noble friend’s second question. I entirely agree with him that growth in Europe will come from sustaining, liberalising measures within the European economy. Again, we have been at the forefront of that by arguing for sound money, for spending European money better and more wisely, and wasting less of it, for decentralisation and for reducing bureaucracy. All these measures are the kind of things that have worked in the past and will work again.

[Lord Stoddart of Swindon]

My Lords, the Statement refers to the British rebate. If there are proposals for changes to Britain’s rebate, can the Leader of the House say whether they would they have to be agreed by veto or QMV? My second question concerns the growth arrangements that four countries agreed on before the summit. Will Britain be making a contribution to that and will it add to the £150 billion to which we are committed through the ECB and the European Investment Bank? Finally, does he agree with Dr Liam Fox that Britain should negotiate a new relationship with the European Union and, indeed, that,

“life outside the EU holds no terror”?

[Lord Strathclyde]

My Lords, on that last point, there is no proposal for the United Kingdom to leave the EU, so the whole question simply does not arise. No analysis has been made, nor is likely to be made, of what life would be outside, and my right honourable friend has no intention of proposing a referendum on whether we should be in or out of the EU. There are substantial benefits to our remaining a member.

Yes, we are committed to funding aspects of the European Investment Bank. Many of these have been debated and discussed in the past.

Finally, the British rebate is absolutely fundamental to our monetary relationship with the EU. We will not agree to giving it up. The noble Lord asked me whether, if it were to be changed, it would be under unanimity or under QMV. I think that I am right in saying that it would be under unanimity; if that is not the case, I shall write to him.

[Baroness Falkner of Margravine]

My Lords—

[Lord Deben]

Does my noble friend accept that we will be more likely to get the rest of Europe to help us, and do the things that we want in terms of growth, if occasionally we emphasise the advantages of our membership instead of constantly suggesting that all sorts of things have to be changed? Will he please ask for a bit more positivity in our discussions about Europe?

[Lord Strathclyde]

There are many of us on all sides of the House who no doubt would like to be positive about the EU, but there a number of aspects to change over the course of the past 15 years that we do not believe should be dealt with at a European level; we would like to repatriate some of these things back to the United Kingdom. I know that my noble friend Lord Deben may not be entirely in agreement with all of that, but dare I say that when we have seen this audit of competences, there may be more agreement around the House as to what should be done at a national rather than a European level than seems to be the case at the moment?

[Baroness Falkner of Margravine]

My Lords—

[Lord Grocott]

My Lords, I have listened very carefully to the Leader’s explanation of the Prime Minister’s position on a referendum. I think that I am an average member of the public and I still have not got the faintest idea what his position on a referendum is. Does he seek a fundamental renegotiation of the terms and conditions of our membership of the European Union, which he would then like to put to the people in a referendum? In which case, I ask the Leader what shred of evidence his leader has from his prime ministership of two years’ standing that any other member of the European Union is prepared to agree to a fundamental renegotiation of Britain’s position within the European Union. Should he fail to get a fundamental renegotiation, will he then put that failure to the British public in a referendum? Presumably, his recommendation then would be that we should say no, and come out.

[Lord Strathclyde]

My Lords, I do not think that the noble Lord was trying to be helpful there at all. He was making his own case and asking questions on his own terms. The plain fact of the matter is that there is currently a fundamental reorganisation within Europe, a reappraisal of different relationships, particularly within the eurozone, which is inevitable, given the crisis that has engulfed the eurozone countries. It may, therefore, lead to a renegotiation; whether or not that is fundamental, it is too early to say. All that my right honourable friend the Prime Minister was saying is something that I think is glaringly obvious: if, under those circumstances, we wanted to change our relationship with Europe, and if that end point became clear, why on earth would we not wish to consult the British people, either in a referendum or at a general election?