Queen’s Speech

Lord Taverne Excerpts

Thursday 17th May 2012 Lords Chamber

[Lord Taverne]

My Lords, I want to speak about our relations with our partners in the European Union. The eurozone crisis is the worst problem we have faced for many decades. As a non-member, Britain has little direct influence. However, our reaction has been to lecture our colleagues, the eurozone Governments, and more often than not to insist that whatever happens we will resist any infringement of our sovereignty. The first is uncalled for and merely serves to irritate our partners. The second increases Britain’s isolation and gravely damages our national interests.

It is worth looking back at why Europe has achieved what it has achieved. The European Union is based on sharing a degree of sovereignty for the common benefit. It replaces national rivalries with a mutual interest in co-operation. This benefits all members in a number of ways. First, it benefits us economically, through the single market. Even the most sceptical anti-Europeans agree that the single market increases our prosperity. However, there would be no effective single market without qualified majority voting—that is, without a degree of shared sovereignty, which we originally supported. Incidentally, we have never been outvoted on qualified majority voting.

Secondly, the EU benefits us through promoting free trade. Without a common European position in trade negotiations, world trade barriers would be much higher than they are. Protectionism is a constant danger, especially at a time of recession, and even some EU countries would like to bring back a degree of protection, but the EU treaty and competition law stop them. Thirdly, it benefits the environment. The European Union, as a group, is the strongest force in the world for action on manmade climate change.

On the political front, co-operation has made least progress, but even here there are huge achievements. The democratic values that the EU stands for have spread to the ex-communist countries and former dictatorships. Enlargement has been one of the EU’s historic achievements, in which we have played a major part. Incidentally, if Greece is forced out of the eurozone—and possibly out of the European Union—it is quite possible that it will return to the dictatorship that ruled before it became a member.

The European Union could act more effectively as a counterweight to the United States and China, which would greatly benefit the world. Both those large countries want a more united Europe with a stronger voice; they are not interested in a Britain which becomes more and more isolated from the Union. We could play a much more effective part in the Middle East, for example, where America’s role as a mediator is hampered by the influence of the Zionist lobby in Congress.

However, successive British Governments have refused to recognise the advantages and importance of sharing a degree of sovereignty. They have talked constantly of red lines; they boast about the battles won against the dastardly continentals trying to do us down. What has been the result? It has been a constant erosion of our influence. Gradually, we are edging more and more into the sidelines. The European Union Act of last year stopped any further moves to more effective sharing of sovereignty, even in cases where it is in our interests. The so-called veto of last December achieved nothing except to exasperate our partners, including our closest allies, and isolate us further.

Soon, we will face crucial decisions for our future. Will we contribute extra funds to the IMF? It seems that the Government are disposed to do so. Will they stand firm against the anti-European lobby, which has proved a very powerful influence in the past? It is likely that, next month, there will be a European Union growth pact, separate from the new treaty. Will we back it? It is vital that this should be a pact of 27, not of 17, and certainly not one of 25 or 26.

We will face decisions on the future of banking in the European Union, crucial to the future of the City. What will happen to the fourth capital requirements directive and the plans for a banking union, with its system for shared guarantees? What will our position be? Of course we have some special interests that we cannot ignore, but they must be considered in perspective. They must take account of our common interests with the rest of the European Union and, above all, the grave danger and damages that would be a consequence of our isolation.

Outside the eurozone, we are already without a voice in the measures to save it. In other areas, the eurozone will take decisions that affect us in important ways. We have placed our negotiators at a huge disadvantage by virtue of last year’s European Union Act, but we still have important cards to play. Germany does not want to be left alone to fight protectionism and dirigisme. France and Britain together can still provide a basis for a European Union defence policy, despite recent divisions about aircraft for our carriers. However, what we badly need is a sense of direction and vision, not a self-defeating obsession to preserve every inch of sovereignty.