EU-UK Relationship (Reform)

Philip Hollobone Excerpts

Tuesday 18th September 2012 Westminster Hall

[Several hon. Members]

rose—

[Mr Philip Hollobone (in the Chair)]

Will those who would like to speak remain standing while we note who you are and how many of you there are?

Under Standing Order No. 47 and the direction of the Chairman of Ways and Means, I will now impose a time limit, otherwise the wealth of talent before me simply will not fit into the time available. The debate finishes in 54 minutes. As a minimum, I have to give the Front-Bench spokesmen 10 minutes each, so I will call them at 10.40. There are 34 minutes for 10 Back Benchers, which means the time limit will be three minutes; the bell will sound after two minutes. If there are interventions, you will not all get in.

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[Mr David Nuttall (Bury North) (Con)]

It is, as always, a great pleasure to follow the hon. Member for Strangford (Jim Shannon). I congratulate my hon. Friend the Member for South Northamptonshire (Andrea Leadsom) on securing this debate.

As chairman of the Lords and Commons “Better Off Out” group, I agree that we should repatriate powers from the European Union. The only difference is that I think that we ought to repatriate all powers. Other countries in Europe should not have the power to tell this country what to do. Given all the problems in the eurozone, it is a fruitful time to renegotiate our relationship with the European Union.

However, based on the precedents, I fear that the hope of success is not great. Nevertheless, it is not beyond the bounds of possibility that in a few months or in two or three years’ time, those who wish to stay in the European Union and repatriate some powers will be successful. The British people will then be faced with what I call an in/in referendum: they will be given the choice of the status quo—staying in as we are now—or staying in with 17/20, 18/20 or 19/20 of the status quo and repatriating a few powers. I suspect that for millions of people in this country, that will simply not be good enough.

The question is what those people should do who think, as I do, that we would be better off outside the European Union. Faced with an in/in referendum, those who wish to be outside the European Union should take part in the referendum and, as a third option to come out will not be granted, simply write the word “out” on the ballot paper. Even if those votes are not counted, it will be clear how many spoiled ballots there are. We will know how many voted for the proposition, how many voted against it and how many voted to come out. That is one way for those of us who think that we would be better off outside the European Union to make our voices heard.

[Mr Philip Hollobone (in the Chair)]

Without interventions, we are on track to get everybody in.

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[Mr Peter Bone (Wellingborough) (Con)]

It is a great pleasure to serve under your chairmanship, Mr Hollobone. It is also a great pleasure, as always, to follow the hon. Member for Rhondda (Chris Bryant). I return his compliment by saying that he spoke exceptionally well, and of course I disagree with every word that he said. He has a great ability to speak for the Labour party, which has made it clear that it wants more Europe, not less. That should be the message that goes out from this Chamber: Labour wants more and more Europe. That is perfectly fair, and I congratulate him on saying it.

I do not know whether you have noticed, Mr Hollobone, but more than 20 Conservative Members of Parliament have attended this debate. There are two Members representing the Democratic Unionist party and one representing the Liberal Democrats, but as for Labour, until the hon. Member for Rhondda came along, there was just the shadow Minister and her Parliamentary Private Secretary. It shows how little interest Labour has in Europe.

I congratulate my hon. Friend the Member for South Northamptonshire (Andrea Leadsom) on securing this debate and on how well she spoke. I regret that she was able to make that speech; in my opinion, she should have been in Government. She is highly talented. The only reason why she is not in Government is that she put her principles first and voted for the EU referendum. She is a highly respected Member and deserves to be listened to. Equally, I am delighted that we have a Minister who should also have been in Government a long time ago. I am sure that now he is here, there will be a change in the direction of Government policy. I live in hope.

A few years ago, I could have made the speech that my hon. Friend the Member for South Northamptonshire made. I have now come to realise that what she described will not be achieved by staying in Europe. The only way that we will achieve it is by leaving Europe and renegotiating. I think that it would be simple for the Prime Minister to unite the Conservative party, give us a huge leap in the polls and bring UK Independence party members back to voting Conservative. He could use the idea suggested by my hon. Friend, which is to renegotiate, then put two options to the British people: accepting the renegotiation or coming out of the EU. After the renegotiation, the Prime Minister can decide whether he will campaign for the new terms or for coming out. That would unite the Conservative party, and it is what I want to see our Prime Minister do when he leads us in the next general election.

[Mr Philip Hollobone (in the Chair)]

I call Julian Lewis, then Bill Cash and Alec Shelbrooke.

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[Andrea Leadsom]

I have to disagree completely with the hon. Lady. The Prime Minister’s use of the veto, far from giving us less influence in Europe, had the opposite effect. What was astonishing was the complete wall of ambassadors and others from the European Union coming to see many of those known to be interested in the EU to find out what the problem is, what was going on and what it is exactly that Britain wants. So she is completely wrong—what the Prime Minister did was a wake-up call and definitely in the interests not only of the City but of Britain.

[Mr Philip Hollobone (in the Chair)]

Order. Before the hon. Member for Wolverhampton North East (Emma Reynolds) responds, she needs to think about bringing her remarks to a close. She has about two minutes left.

[Emma Reynolds]

I could not disagree with the hon. Lady more—I have made that clear.

Today’s debate is reminiscent of the 1990s: the divisions of the Tory party have not yet healed. We have seen three different positions on the Government side: no change and stay in; stay in and argue for repatriation and renegotiation; and to get out. The Conservative party is utterly divided. As long as the Government put the party interest before the national interest our stock in Europe will remain low and our ability to argue for reform will remain incredibly limited. It is regrettable that the Government are divided at home and weak in Europe, and that they are therefore incapable of being a strong and effective voice for reform in Europe.

Oral Answers to Questions

Philip Hollobone Excerpts

Tuesday 4th September 2012 Commons Chamber

[Mr Lidington]

There are all sorts of exciting media reports, but there are no proposals for treaty change on the table at present. I simply remind the hon. Lady, however, that while the Government parties have supported giving the British people the final say over any proposal from any Government to join the euro, her party leader has said that securing the objective of Britain joining the euro will require only his remaining as Prime Minister for long enough.

[Mr Philip Hollobone (Kettering) (Con)]

5. What recent assessment he has made of the potential threat to stability in the middle east of Iran’s nuclear programme.

[The Secretary of State for Foreign and Commonwealth Affairs (Mr William Hague)]

We remain deeply concerned about Iran’s nuclear programme. A nuclear-armed Iran would result in still greater instability in the middle east and increase the risk of a nuclear arms race. Iran must negotiate seriously on the nuclear issue, to give the international community confidence that it is not developing nuclear weapons.

[Mr Hollobone]

The International Atomic Energy Agency reckons Iran has 189 kg of uranium enriched to 20%. Were this quantity enriched to 90%, that would be enough for five nuclear bombs. Given that enrichment to 20% requires four fifths of the effort to get to 90%, will my right hon. Friend redouble the United Kingdom’s efforts to prevent Iran from becoming a nuclear-armed military power?

[Mr Hague]

Those efforts have been redoubled in recent times in many ways, and my hon. Friend will be aware that, with our partners in the European Union and many other partners and allies around the world, we have imposed more serious economic sanctions on Iran than we have imposed on any country in recent times. This has caused Iranian oil exports to fall by about 1 million barrels a day from last year. Iran is losing almost $8 billion in revenues every quarter as a result of that, and we will continue to intensify the pressure from sanctions, as well as remain open to negotiations, in order to try to resolve this issue. In the longer term, we take nothing off the table in our efforts to resolve the issue.

Balance of Competences

Philip Hollobone Excerpts

Thursday 12th July 2012 Commons Chamber

[Mr Hague]

Of course the review will be able to examine that issue, and my hon. Friend, among others, will be able to make representations about it. Part of the argument about how competence is exercised, and about the level of government at which it should be exercised, relates to the costs that are involved, and it will therefore be wholly legitimate to consider such questions.

[Mr Philip Hollobone (Kettering) (Con)]

I welcome the review, but may I express my regret that it does not go far enough? My right hon. Friend is right about so many things, and indeed I was with him until the second sentence of his statement—[Laughter]—in which he said, “Membership of the EU is in the UK’s national interests.” I do not agree with that, and nor do an increasing number of my constituents. Rather than asking what is the balance of the relationship between Britain and our EU partners, should not the review ask whether the United Kingdom is better off in or better off out of the whole thing?

[Mr Hague]

I appreciate the fact that my hon. Friend was with me until the second sentence of my statement. However, given that in the first sentence I merely said that I was going to make a statement, I will not take that as a ringing endorsement.

Of course my hon. Friend has a strong view, which is different from mine, about membership of the European Union. However, I think that he will concede that reviews of this kind, which spell out in detail how competence is exercised and, in many instances, what the costs are, and which set out properly the facts of how it is exercised in a single market, in directives and in many other contexts, can at least ensure that any debates about that issue, now and in future, are better informed and take place on the basis of a common understanding of the facts that would otherwise be lacking.

West Bank (Area C)

Philip Hollobone Excerpts

Wednesday 4th July 2012 Westminster Hall

[Mr Doran]

I agree with the hon. Lady. There are less light words than Swiss cheese for what is happening; it is very serious and damaging to any potential solution. She is absolutely right.

[Mr Philip Hollobone (Kettering) (Con)]

I refer the Chamber to my declaration in the Register of Members’ Financial Interests.

I take the issue of settlements seriously, but listening closely to the hon. Gentleman, I simply cannot understand his repeated reference to settlements taking up 40% of the west bank. I have the United Nations “Humanitarian Atlas”, and there is simply no way that the Israeli settlements amount to anywhere near 40% of the west bank. May I ask him to ensure that he is quoting a correct figure?

[Mr Doran]

I stand by the figure. I am not suggesting that 40% is built on; that is not the issue. I am talking about the area of land that is restricted with regard to Palestinians. It includes the road network. The Swiss cheese effect was mentioned by the hon. Member for Maidstone and The Weald (Mrs Grant). There are large areas to which the Palestinian community is denied access. That calculation is made, as I said, in a 2006 report by an Israeli human rights organisation. I want to make progress now, because the hon. Member for Kettering (Mr Hollobone) will have his opportunity to speak later.

On my visit to the west bank, I saw numerous examples of how the Israeli civil Administration restrict any kind of development by Palestinians. Around 70% of Area C, or 44% of the west bank, is effectively off limits to Palestinian construction—the hon. Member for Kettering made me nervous of getting into such statistics, but I have to stick by them—and is designated for exclusive use by Israeli settlements and the Israeli military, or is taken up by nature reserves or the barrier buffer zone. In the remaining 30% of Area C, a range of restrictions makes it virtually impossible for Palestinians to be granted permission for development.

The most frequent obstacle to Palestinian development is the requirement on the applicant to prove that he or she owns or has the right to use the land, but most land in the west bank is not registered, so the owners must go through a complex system involving tax and inheritance documents. The second ground for the rejection of most Palestinian permit applications is the requirement that the proposed building must be in conformity with an approved planning scheme that is detailed enough to enable building permits to be used. Palestinian villages, however, lack sufficiently detailed plans. The outdated plans that do exist are interpreted restrictively by the Israeli civil authority. In practice, only about 1% of Area C is available for the construction of new properties, and most of that is already built up.

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[Bob Stewart]

Yes, I accept what the hon. Gentleman says about that.

Area C is, of course, the key to sorting out the problem because it makes up the majority of the west bank. The right hon. Member for Lewisham, Deptford (Dame Joan Ruddock), who is no longer in the Chamber, has already made that point.

[Mr Hollobone]

Can we please get the facts right? According to the United Nations, Area C is 39% of the west bank. That is not the same as the area covered by settlements. I am afraid that my hon. Friend is not correct to say that Area C makes up the majority of the west bank. According to the UN, it is 39%. I recognise that it is a big area, but let us get our facts and figures correct to better inform the debate.

[Bob Stewart]

I hope my hon. Friend will forgive me, but when I look at the map he is holding up, it looks to me more like 60% blue. But let us not get into an argument; whether the area is 40% or 60%, something is wrong.

There are, as we have mentioned in the debate, about 310,000 Israeli settlers in Area C. There are 149 settlements—okay, people might dispute that, but it is more than 100—and there are about 100 outposts, which are illegal under both international law and Israeli civil law. Already, it is said, about four of the settlements could rightly be called cities. That is quite big. Under international law, all settlements are illegal and outposts are most definitely illegal.

Two kinds of people live in Area C. There are Israelis, who are subject to Israeli civil law, loosely—as I understand it—because they sometimes do not pay much attention to the Israeli police. In fairness, they are sometimes, apparently, in defiance of what Israeli police are trying to do. The other kind of people living there are Palestinians. They are subject to military law. That is wrong. When I visited Area C, the difference was quite clear. Palestinians cannot build where they live, except in a small percentage—1%, 2% or 3%—of the country; nor do they have freedom of movement. They have to stay in their home area. For example, a Palestinian living in Area C with relatives in East Jerusalem cannot easily go to visit them. That is wrong.

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[Mr Philip Hollobone (Kettering) (Con)]

It is a pleasure to follow the right hon. Member for Southampton, Itchen (Mr Denham). I congratulate the hon. Member for Aberdeen North (Mr Doran) on securing this debate. This is a hugely complex issue. All of us who have visited Israel or the Palestinian Authority will know what a small geographical area of land we are talking about. It is important to get these complex issues into some sense of proportion. We are talking about Area C, in which 150,000 Palestinians live. There are 1.4 million Palestinians living in Israel and 2.5 million Palestinians living in Areas A and B. It would be wrong if this Chamber today gave the world the impression that we are talking about most of the Palestinian population, because we are not.

The west bank has always been under occupation. In 1948, it was annexed by Jordan, which, as far as I can tell, did not do much with it. The Gaza strip was annexed by Egypt, and then the situation was even worse. To imply that it is just Israel that has occupied this benighted land would be quite inaccurate.

[Mr Slaughter]

The hon. Gentleman is showing uncharacteristic false logic. The reason for designating Area A is because it contains the main Palestinian towns. It would be a bit like saying that as long as we excluded London, Manchester and Birmingham, we could allow someone else to occupy all the rural areas of England. This is the Palestinians’ land, and they are entitled to all of it.

[Mr Hollobone]

One of the big tragedies of the Palestinian nation was that it did not accept the United Nations partition plan in 1948. A whole series of wrong decisions have been made by the Arab people since that time. The Israelis are not going to go away. After the holocaust in Europe, they deserve a homeland. As David Ben-Gurion said, we will have to arrive at a peaceful settlement with the Arab people who live in the Holy Land. We are all still in pursuit of that peace. Some of the Palestinians live in terrible situations. I visited them myself in the Gaza strip, and on the west bank. That is all the more reason to arrive at a peace settlement with Israel, so that both peoples can live in harmony with each other. Like my hon. Friend the Member for Beckenham (Bob Stewart), I am not in the blame game. I recognise that this is a hugely complicated situation, but we must get a sense of proportion if we are to arrive at sensible and lasting peace for both the Israeli and Palestinian people.

[Annette Brooke (in the Chair)]

I call Ben Bradshaw—literally for one minute.

Oral Answers to Questions

Philip Hollobone Excerpts

Tuesday 17th April 2012 Commons Chamber

[Alistair Burt]

We thought that it was a good report, with elements that we certainly recognise and that also match some of the issues raised through the Lessons Learnt and Reconciliation Commission, so those concerns will form part of our dialogue with Sri Lanka as it works towards its own determination to secure peace and reconciliation for the future, which we believe must also be based on justice for the past.

[Mr Philip Hollobone (Kettering) (Con)]

T7. Following a recent visit to Gaza, I refer the House to my entry in the register. Have Her Majesty’s Government raised with Egypt the serious impact on Gaza’s economy, basic infrastructure and medical facilities and the Gaza strip’s sole power station of Egypt’s recent restrictions on fuel exports to the Gaza strip?

[Alistair Burt]

I have not raised that specifically with Egypt. We are aware of the concerns about power and fuel and the discussions among the relevant parties to try to resolve it. We are following those discussions closely and urge those parties to solve the issue so that some of the pain of the Gazan people can be relieved. My hon. Friend is right to raise it.

Syria

Philip Hollobone Excerpts

Monday 6th February 2012 Commons Chamber

[Mr Hague]

Many people may share my hon. Friend’s view about the views expressed by dual nationals in this country. However, views expressed are no grounds to deprive anyone of their nationality. If I took that suggestion to my right hon. Friend the Home Secretary, I am sure that she would be very clear about that. I therefore cannot hold out any hope to my hon. Friend that we will be able to act in the way that he would like us to.

[Mr Philip Hollobone (Kettering) (Con)]

What role can Jordan play in helping to resolve this crisis?

[Mr Hague]

Jordan is playing a strong and constructive role. I discussed the situation a couple of hours ago with Nasser Judeh, the Foreign Minister of Jordan. It supports and is an energetic sponsor of the work of the Arab League, and it co-sponsored the resolution that was put to the UN Security Council. We welcome its active participation.

EU Sanctions (Iran)

Philip Hollobone Excerpts

Tuesday 24th January 2012 Commons Chamber

[Mr Hague]

I do not anticipate the sanctions being brought forward. This is the result of a long and complex negotiation over the last few weeks. But I do anticipate that purchasers of Iranian oil in the European Union will decline steadily. It is not a continuous amount and then a cliff-edge effect. The effect of the phasing and the coming into force on 1 July is that remaining purchases will be declining long before then.

[Mr Philip Hollobone (Kettering) (Con)]

Is not the Iranian regime hellbent on developing a nuclear weapon? Nothing will stop it short of a breakdown in the developmental process or the overthrow of the regime either from inside Iran or by military action. If sanctions do not work, would not the response of the Iranian regime be to redouble its efforts to develop a nuclear weapon before effective sanctions bite?

[Mr Hague]

In many ways that is the case for wide-ranging sanctions policies that address the oil industry and the financial sector. If they are worth doing at all, given the gravity of the situation, sanctions are worth doing seriously. That was my argument at the Foreign Affairs Council yesterday. My hon. Friend is right that at the moment the Iranian leaders are clearly determined on the development of nuclear weapons capability. However, I do not think that one can speculate with certainty about what may happen over the coming year—about the effect of sanctions or any flexibility that may be shown in negotiations—so I am not prepared to say that there is no possibility of such a policy working and that one must therefore reach for other solutions. We want sanctions, coupled with negotiations, to work, and this is not the time to speculate about what might happen if they do not.

European Council

Philip Hollobone Excerpts

Thursday 8th December 2011 Westminster Hall

[Mr Baron]

As I said at the start, I do not buy the repatriation of powers. I want a fundamental renegotiation of our relationship with the EU based on free trade, competition and growth. Such a renegotiation would recognise the fact that we want good relations with our EU neighbours, and we want good trade relations in particular, but we recognise that we need to engage better with the faster-growing economies throughout the world. In many regions of the world—those of the BRIC economies—growth rates are so much faster. This is not a little Englander approach; it is a globalist approach that recognises that we need to engage better with those faster-growing areas.

[Mr Philip Hollobone (Kettering) (Con)]

I am hugely enjoying my hon. Friend’s speech; he is making some excellent points. Does he agree that in 1980 the EU’s share of world trade was some 30%, but by 2020 it is likely to have fallen to 15%? In other words, it will have halved over a period of 40 years, yet we find ourselves increasingly brought together with part of the world that will grow more slowly than the BRIC economies.

[Mr Baron]

My hon. Friend makes an excellent point. There is much talk of Germany winning market share, but one forgets that Germany has benefited from an artificially weak currency, to which the periphery nations have contributed. Germany has had a very strong manufacturing base allied to a weak currency, which has made for heady growth, but if we take Europe as a whole, it is falling behind. Many people do not recognise that.

I worry that the Government have ruled out the idea of a referendum. I think that is a mistake as we go into a summit, because it cuts off a key negotiating ability. I also worry that we seem to be saying we do not want a two-speed or two-tier Europe, but on the other hand we are trying to join in the chorus of “we must save the euro”, which can only mean closer fiscal union, which can only result, as Angela Merkel has readily acknowledged, in a two-tier, two-speed Europe. It is nonsense and a contradiction. Anybody who believes that closer fiscal and political union will not fundamentally or materially affect our relationship with the EU is living in cloud cuckoo land.

Before I finish, I will attempt to knock down one or two myths surrounding the debate. The first myth is that we must save the euro. In my 15 years in the City running hundreds of millions of pounds for charities, pension funds and private clients with some very large fund management groups, I have never heard so much economic clap-trap. The whole concept to begin with was flawed. The idea that we can bind divergent economies into a single currency without full fiscal union was and remains a mistake. Not only the concept but the solution is flawed. The problem is that we are not addressing the core issue of competitiveness. We have Governments spending too much relative to their means.

This recession, unlike all other post-war recessions, is built on debt. It is a deleveraging, not a destocking, recession. Accordingly, we have to grow our way out of that and reduce our debt. We cannot, as we all know, borrow our way out of debt. The solution does not fit, so I am not convinced that the solution put forward by the present eurozone leaders will work, anyway. However, let us give them the benefit of the doubt. Let us say it buys time. The problem is that by cutting off the option of devaluation—put that and the fact that the solution does not fit to one side for a second—even if it buys time, we are making the austerity packages much worse.

I have previously broached the fact that there have been some 80 situations in which countries have left currency unions since the second world war and have benefited from the growth that has followed. We saw it in our own case when we exited the exchange rate mechanism. By binding countries into a single currency, we have to make the austerity packages more severe, because we are ruling out the option of devaluation, which would increase competitiveness. The eurozone leaders do not seem to understand that. If there was an orderly break-up of the euro, certainly for the periphery nations, the Germans would still want to sell their cars and the French their wine. Believe me, life would go on.

Many say that the banking system could not survive the write-off of the debts. That point was made earlier. However, the markets have already discounted the debt in many of these countries by 60%. It would not come as much of a shock if there was a 50% write-down. In many cases, that would represent a 10% uplift by the banks themselves. This is an economic point that has not been widely acknowledged and accepted. The markets have already downgraded the debt, so this will be a downgrade instituted by politicians. Look at what the markets themselves are telling us.

Nobody has been able to quantify or substantiate why it would create economic mayhem if we did not save the euro. Siren voices also suggested that if we left the ERM something similar and awful would happen. Actually, almost to the day, our economic recovery kicked off.

Finally, if the eurozone wants to crack on and create closer fiscal union, that is fine. That is not, or should not, be mutually exclusive to our objective of wanting to negotiate a different and fundamentally new relationship with the EU. They are not mutually exclusive. Many commentators seem to suggest that by wanting to renegotiate the relationship, we are breaking up or being awkward about what the 17 eurozone members want to do. That is not the case. If they want to take that path, it is up to them, but their taking that path should not restrict us.

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[Mr William Cash (Stone) (Con)]

I congratulate my hon. Friend the Member for Harwich and North Essex (Mr Jenkin) on securing this extremely important debate. It is a substitute for the debate that the European Scrutiny Committee has insisted should be held on the Floor of the House, but which has been declined by the Government so far.

[Mr Hollobone]

I am looking forward to my hon. Friend’s speech very much indeed. Would it not have been marvellous if the Leader of the House had timetabled an opportunity this week, perhaps on Wednesday afternoon, for the Prime Minister to hear hon. Members’ views on what he should say at the European Council? Then he would have been able to jet off today to that summit with all the suggestions fresh in his mind. Instead, it was up to the Backbench Business Committee to timetable the debate for this afternoon.

[Mr Cash]

I agree. People were not listening back in the days of Maastricht and they are not listening now. That is the problem. I give special thanks to my hon. Friend the Member for Harwich and North Essex not only for this debate but for the consistency that he has shown since the days of the Maastricht rebellion, which I had the honour to lead all those years ago and of which he was a very important member. He was a new Member of the House and he understood the position immediately, as did my right hon. Friend the Member for Chingford and Woodford Green (Mr Duncan Smith) and a number of others who have remained in the House.

This is not only an historic question but a national question. The now absent hon. Member for Luton North (Kelvin Hopkins) mentioned Peter Shore and Bryan Gould. When I set up the Maastricht referendum campaign, it was hon. Members on the other side of the House, such as Peter Shore and Bryan Gould, who joined me in that campaign. We presented a petition, which many people may recall, of well over 500,000 signatures; in fact, we reckon that we got 700,000 signatures all told. The petition was deposited, calling for a referendum on the Maastricht treaty. I was delighted that my right hon. Friend the Prime Minister said only a couple of weeks ago that there should have been a referendum on that treaty. As one who was very deeply engaged in the whole of that process, from beginning to end—much to the dismay of those who have now, in my opinion, lost the argument—I believe that the necessity of knowing the views of the British people remains implicitly entrenched in the arrangements that are now coming forward and that therefore a referendum is essential.

I should now like to move on to the present time. I want to address the question facing us today in terms of the broad landscape. I wrote a pamphlet that was published in effect in this very room when we had a conference between the leading Eurosceptics and the leading Europhiles. It involved Charles Grant of the Centre for European Reform, Roland Rudd of Business for New Europe and a galaxy of others. Both sides regarded it as essential that we should get together and properly debate the questions on both sides of the argument with many of the best people from the two sides of the debate. In that pamphlet, I set out details that I will not go into today, but I say to those who are interested and who read the transcript of these proceedings that it is available. Indeed, the Prime Minister has written to me, saying that it is a substantial document and effectively, therefore, it has to be answered. He has said as much to me, and it does have to be answered. I assume that my right hon. Friend the Minister for Europe will do so in due course.

This is an historic turning point for both the country and the Conservative party. The dream of ever-closer union and, indeed, political and economic union has failed, and the root of that trouble is the fantasy world, which has persisted for so many decades, of trying to create economic and political union among so many diverse countries with diverse cultures, diverse economies and diverse democratic traditions.

Only today I witnessed Mr Barroso on the television screens berating everyone in the most dictatorial language. He was saying that everyone had to come together for the sake of saving this project. They themselves are responsible for having created it and they are now attempting to save it, despite the fact that the causes of the present discontent come from the creation of this project in the first place by the very people who are now berating everyone else.

I will go further and refer to two documents that I have just obtained. One is dated 6 December. It is Mr Van Rompuy’s document, entitled “Towards a stronger economic Union”. There is not one word about democracy anywhere in that document—the word “democracy” does not appear. Similarly, in the letter written to the President of the European Council—Mr Van Rompuy, no less—by Mr Sarkozy and Angela Merkel, there is not a single reference to the democratic question. There is not one iota, not one jot of a reference to democracy in either of those documents, yet they are demanding that this failed project be continued with greater—deeper—integration. All the mistakes that have been made in the past are being reinforced in the new arrangement, which clearly will not work. It did not work before and it will not work now. It is a tragedy— I say that—that we are in the current position. I trust that the Prime Minister will address that during the next 48 hours.

This is not some theoretical experiment. It is about the daily lives of the British people and about our democratic traditions and economic performance. The idea that a fiscal union of 17 would be stable is simply and emphatically wrong. It will concentrate and increase the dangers of centralisation and will be fundamentally unstable. Germany will not be able to bail out the other countries, and it is a complete strategic failure for people, including the coalition Government, to think that it can.

Germany of course wants to preserve the euro, because it is doing so well out of it. One has only to consider the foreign direct investment by the Germans in other countries, the extent to which those countries are in effect economic satellites of Germany and the fact that the structural funds—I have the figures from the Library—are so incredibly important in generating investment backed by German contracts in those other countries, from which they then repatriate the profits. This is actually a German economic hegemony. Equally, I do not think that the Germans are inherently hostile about this. I say what I say without any hostile spirit, but I do say that we have to be realistic. We are desperately at risk. The British nation is in peril under these arrangements.

Furthermore, the impact of this economic conglomeration in the hands of one country in particular has led not only, in effect, to the dismissal of two Prime Ministers, whatever their merits or demerits, but to the voting arrangements, which follow from the qualified majority voting system. I am talking about the number of votes that are available to Germany when it wants to pursue a policy, because of its influence and, in effect, its control over the countries in question, which are dependent on it. That is the case not only in the eurozone of 17, but in so many of the other countries, including— I say this without any disrespect for them, because I love these countries—Poland and Denmark. Then of course there are Bulgaria, Romania, the Baltic states, Hungary and so on. The truth is that that is inherently in German national interests. Indeed, we have to look only at what Chancellor Kohl had to say in the 1990s, which I have included in a pamphlet that I wrote, called “It’s the EU, stupid”, to see the political determination behind Germany’s desire to ensure that the euro survives. Angela Merkel is now using that very language in the same context.

I do not blame the Germans. I have said in this Chamber that I recognise the fact that to a great extent they have shown their commercial nous—they have taken advantage of the system to ensure that they get the best out of it. The organisation is not a European union, but effectively a greater Germany.

We, above all other countries in Europe, ought to recognise that we should defend our own interests—not, as I said, in a hostile manner, but in a realistic and down-to-earth manner. We ought to get across the message that there should be, inherent in the proposed arrangements, a fundamental change in our relationship with the European Union. We and, if I may say so, the Prime Minister, have an absolute duty to protect the national interest that he says he wants to protect; to ensure that there is fundamental reform in the European Union, which he called for at the Mansion house the other day, to generate the growth that we need, with our 40% of trade with the Union and to guarantee that we are not drawn into an arrangement by which, through a majority block vote, we are consistently outvoted and become completely and utterly controlled by the system. It just does not make sense, and I believe that the system will not work.

It needs to be pointed out that not only is voting power naturally going to Germany, with its economic investments—it is doing extremely well out of the system—but Germany believes that it can require countries to obey rules. That is a much deeper question, a matter of attitude. We cannot require countries to obey rules just because we prescribe them. That is where I think the whole philosophy and the attitudes in the Eurocracy and in Germany go wrong. As we have heard, the Germans themselves have not obeyed the rules on the stability and growth pact when it suited them not to. An inherent dishonesty lies at the heart of the arrangements: someone disobeys the rules when it suits them, but insists that the rules be obeyed when they can benefit out of those rules. That cannot be right.

Countries are made up of individuals and individual companies, which have their own ideas as to how they should be democratically governed. Those ideas do not by any means fit within the rules prescribed from above or the conditions that are imposed. The Eurocrats, Germany and those who go with it on the matter simply do not understand that the lack of democracy is a fundamental flaw in the entire European project.

--- Later in debate ---

[Mr Cash]

First, there is a strong case for getting out of the euro, because that would enable countries to—[Interruption.] It is described as irrevocable, but I have news for the hon. Member for Cheltenham (Martin Horwood): treaties and laws have been passed for not generations but centuries, and there are more treaties and international relationships that have been reviewed and changed than he might have had hot breakfasts. When those things do not work, there is a good starting point for reviewing them. That is what we are doing now.

[Mr Hollobone]

My hon. Friend thinks that there may well be a move to establish a fiscal union of the 17 eurozone countries. If that is not possible, and if an agreement of the full 17 cannot be achieved, does he think that there could be a move to establish a fiscal union with a smaller number of eurozone countries to let some of the peripheral economies have some kind of orderly default?

[Mr Cash]

I think that the crisis is so great that that suggestion has to be taken on board seriously. I agree with the sentiment that lies behind that suggestion.

--- Later in debate ---

[Mr Philip Hollobone (Kettering) (Con)]

I believe that my constituents in Kettering see this weekend’s summit as a once-in-a-lifetime opportunity to renegotiate Britain’s relationship with the European Union. I also believe that they want me to state that they want their say in the future of our country’s relationship with the European Union through a referendum at the ballot box. It would be a huge credit to the Conservative party if we were to go to the country on any deal that the Prime Minister negotiates this weekend. It would expose the myths that we are being told by the Liberal Democrats about how in touch they are with popular opinion and would reveal once again the flaws in their manifesto. They seem increasingly to find ways to deny people a referendum on issues on which they promised them a vote.

My constituents in Kettering want us to be part of a common market. They want a free trade relationship with Europe and, increasingly, with the rest of the world, but the EU’s share of world output is falling year by year. It was 30% of world trade in 1980, and it will be 15% by 2020. Periodically, we all cut ourselves up about how important Europe is to this country, but we are increasingly tying ourselves to an economic bloc that is going south, not north. The future of our great trading nation lies with the emerging economies such as Brazil, India and China, many of which are Commonwealth countries with which we have deep and close relationships that could be deepened ever further.

On what the Prime Minister should be demanding back from the EU this weekend, we could not have a debate on the European Union chaired by you, Mrs Main, without mentioning the habitual residency test. The Secretary of State for Work and Pensions has said that the European Union is trying to overturn the United Kingdom’s rules on benefits to benefit tourists. This country refuses to give them benefits if they do not pass the habitual residency test, yet the European institutions are trying to overturn that regulation at a cost, according to the Government’s own figures, of between £2.5 billion and £5 billion every year. That is one thing to demand back from Europe.

My constituents would also like the Prime Minister to demand back control over our borders once again, because they are fed up with the mass immigration from the European Union on to our shores. We want our fishing grounds back and our agriculture policy back. Above all, we do not want to spend more and more each year on our membership subscription. In the last five years of the previous Labour Government, the membership subscription was some £19 billion. At the end of this coalition Government’s five years—should they last that long—it will be £41 billion. The cost of our membership has doubled as the red tape coming out of Brussels increasingly strangles the ability of British business to create the wealth that pays for our subscription in the first place.

This is a wonderful opportunity for our country. I hope that the Prime Minister has the courage to seize this golden opportunity to restate Britain’s relationship with the European Union and to create a brighter relationship not only for the EU but for Britain outside it.

British Embassy (Tehran)

Philip Hollobone Excerpts

Wednesday 30th November 2011 Commons Chamber

[Mr Hague]

I am grateful to my hon. Friend for his support. His comments, like those of many other Members, demonstrate the high regard of all parties in the House for the conduct of our diplomats, in particular our ambassador and our chargé d’affaires, both of whom did extremely well. We have already put the question of compensation and the financial liability of the Iranian Government to the Iranian chargé d’affaires, and we shall continue to pursue the matter.

[Mr Philip Hollobone (Kettering) (Con)]

In my right hon. Friend’s view, is the Government-inspired assault on the British embassy in Tehran indicative of the weakness or the strength of the internal political leadership in Iran?

Oral Answers to Questions

Philip Hollobone Excerpts

Tuesday 29th November 2011 Commons Chamber

[Mr Philip Hollobone (Kettering) (Con)]

What conclusions have the Foreign Secretary and his EU counterparts reached on Iran’s involvement in propping up the Syrian regime?

[Mr Hague]

There is no doubt that Iran has been involved in trying to prop up the Syrian regime. Iran is a country that has supported popular revolution in other parts of the middle east but then has been happy to collude in trying to repress such revolution in Syria—its ally. It has helped with technical equipment, expertise and advice on how to help the regime to deal with the situation, and it shows a hypocritical approach to events in the middle east.