Commission Work Programme 2015

William Cash Excerpts

Monday 9th March 2015 Commons Chamber

[The Minister for Europe (Mr David Lidington)]

I beg to move,

That this House takes note of European Union Document No. 5080/15 and Addenda 1 to 4, a Commission Communication: Commission Work Programme 2015–A New Start; and supports the Government’s view that the most significant initiatives are those that focus on the strategic priorities set out by the European Council in June 2014 to promote jobs, growth and investment in the EU.

This is the fourth such debate in which I have taken part as Minister for Europe, but I think it is the first time I can say that the European Commission has sent a strong message that it intends to do things in a different fashion from how its work has been carried out in the past. The clear message from President Juncker and his team is that they want to focus on a smaller number of key priorities and that they wish to set limits on the degree to which the Commission, and the EU collectively, can interfere in matters that are often better handled at national or local level.

Of course, the test of that message will be what happens in practice; it is actions that will count, not words. However, I am encouraged by the creation of the powerful post of First Vice-President of the Commission, which gives Frans Timmermans, the former Dutch Foreign Minister, an overarching power to veto any proposals that do not meet the requirements of subsidiarity and proportionality. He is already making it clear that a key element of his responsibility is to say a firm no to fellow commissioners, to the European Parliament and to outside lobbyists and to focus only on those matters where the Commission judges that European action would genuinely give Europe added value that could not be achieved by other means.

[Sir William Cash (Stone) (Con)]

I have spoken with Mr Timmermans a number of times in COSAC meetings with the chairmen of the 28 member states. On the question of national Parliaments, which is the key question in relation to subsidiarity—it is the question of what should be done best at the appropriate level—is not it the case that, for all the words about involving national Parliaments, we will not get much change out of Mr Timmermans, any of the Commissioners or the European institutions if we insist on national Parliaments at the expense of the European Parliament?

[Mr Lidington]

I do not want to pre-empt tomorrow’s debate on the European Union’s relations with national Parliaments and the principles of subsidiarity and proportionality. My hon. Friend is right to identify this as a challenging agenda and to indicate that the European Parliament, in particular, is likely to be resistant to the idea of a stronger voice for national Parliaments, but I think that he is too pessimistic in his assessment of Frans Timmermans. After all, it was during Mr Timmermans’s tenure as Foreign Minister of the Netherlands that the Dutch came forward with a number of specific proposals for strengthening the role of national Parliaments in holding EU decisions to account. I take heart from the fact that we have in this powerful role within the Commission somebody who has previously gone on the record to say that the guiding principle should be, “Europe where necessary, but national where possible”, and who has been very sympathetic to ideas for strengthening the role of national Parliaments.

The Commission has set out a clear intention to be more strategic and to act in a smaller number of areas where there is real added value for the EU. It has also said that it wants to demonstrate a particularly strong focus on jobs, growth and European competitiveness, which are objectives that the Government strongly support. The Commission has pledged to create a closer partnership with member state Governments and national Parliaments. We can see some evidence of the Commission’s approach by looking at some of the numbers in the work programme. The work programme includes just 23 legislative and non-legislative policy initiatives and—importantly— 80 measures proposed for either withdrawal or modification.

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[Mr Lidington]

I can check the precise date and let the right hon. Gentleman know. There has been a delay, which I regret, because it has taken time to get collective agreement on this and on a number of other debates that the European Scrutiny Committee has referred. Originally, we considered having this debate in Committee, but, having discussed the issue with my right hon. Friend the Leader of the House after he had given evidence to the European Scrutiny Committee, the Government decided to have a debate on the Floor of the House. I am just glad that we are having this debate relatively early in 2015.

[Sir William Cash]

I suspect that that is an invitation to say that the amendment that I and many other members of my Committee have tabled, which I hope the Minister will accept, deals with free movement—a massive issue that affects immigration. The fact that it has been not merely delayed, but stalled for more than a year must have been a coalition decision, but we have not been told who was behind it, so who was it?

[Mr Lidington]

As I told my hon. Friend when I last gave evidence to his Committee, the Government take decisions collectively and it would not be right for me to go into detail about internal Government communications. I will come to the issues raised by the amendment shortly, but first I want to say more about the importance of the proposed work on economic affairs and competitiveness.

The United Kingdom has long argued for ambitious trade deals. The ongoing Transatlantic Trade and Investment Partnership and EU-Japan negotiations could benefit this country annually by more than £15 billion, so the comprehensive stocktake of trade policy proposed by the Commission is welcome.

The EU’s greatest achievement—the single market—is still very far from complete, so we are pleased that the Commission plans to push liberalisation in sectors that could boost GDP the most, such as construction and professional services. We want EU legislation to enable the dynamic development of the future economy by supporting and not hindering a continent-wide digital single market. If that is done right, in a way that encourages the growth of online trade—both retail and business to business—it could generate €250 billion over the lifetime of this Commission.

We also support the Commission’s vision of a well-regulated and integrated capital markets union of all 28 member states that maximises the benefits of capital markets and non-bank financing for the real economy. Lord Hill’s recent Green Paper on the subject spelled out the approach he plans to take, and the Government will, of course, engage with his team as the policy is developed further.

We welcome the fact that the Commission intends to consider a range of approaches, and not just legislation, to develop Europe’s capital markets, and that much of that will be delivered through member state and industry action, rather than through EU-level law or regulation.

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[Mr Lidington]

In fairness to President Juncker, with whom I do not agree on that point, it is not a secret that he has held that view for a long time and I suspect it is held by pretty much every leading politician in Luxembourg. [Interruption.] That is the reality. A small European country would see an obvious benefit to its national interest from that sort of greater European action. The British Government do not share the view that a European army would be helpful or necessary. We believe that NATO is and should remain the centrepiece of our collective defence and security arrangements.

Were there to be any move towards establishing greater European military integration, it would first require consensus among member states, because such matters cannot be determined by a qualified majority vote under the treaty. Moreover, as I am sure my hon. Friend will recall, in passing the European Union Act 2011, this House required that there would have to be both an Act of Parliament and a referendum of the British people before any British Prime Minister could give consent to a proposal for the establishment of an EU army or armed forces in some hypothetical future.

[Sir William Cash]

Of course, if we were no longer members of the European Union by that time, we would not need to give consent because we would not be in the position to do so.

[Mr Lidington]

We can argue about all sorts of improbable hypotheticals, but the key point is that, while President Juncker was expressing a view that he has made no secret of holding in the past, this is not a live issue for debate around the table in Brussels at the moment. In fact, both President Juncker and others who have spoken in support of a European army or defence force have said that they see it as being a very long-term objective.

Turning to the amendment tabled by my hon. Friend and a number of other members of the European Scrutiny Committee, the Government recognise public concerns about immigration from other member states and the need for the Commission to do much more to address the abuse of free movement rights and the problems to which it gives rise. That is why this Government have gone further than any previous Administration to try to tackle the problems associated with free movement both domestically and at the European level.

We have acted domestically to tackle abuse and ensure that the rules governing access to our welfare system and public services are as robust as possible. Only today, my right hon. Friend the Secretary of State for Work and Pensions has laid regulations in Parliament to ensure that EU jobseekers have no access whatsoever to universal credit.

At European level, we secured language in last June’s European Council conclusions on the need for the Commission to support member states in combating the misuse of free movement. We continue to work both with member states and the Commission to reform EU social security co-ordination rules so that they better reflect current migration patterns and the divergent, diverse nature of member states’ welfare systems, while ensuring that member states can maintain effective control of their own welfare systems. Welfare provision is of course set down in the treaty as belonging to the competence of member states, rather than that of European institutions.

We welcome the proposal in the work programme on the labour mobility package—it covers several such items—which will assist us in carrying forward our ideas. However, we are very clear that there is much more to do, as my right honourable Friend the Prime Minister made clear in his speech on 28 November. I therefore have no problem in welcoming the amendment tabled by my hon. Friend the Member for Stone (Sir William Cash), which will be agreed to at the end of the debate.

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[Mr Pat McFadden (Wolverhampton South East) (Lab)]

This is the first of two debates on the European Union over a couple of days—a double-header, as it were. It is a bit like Davis cup tennis, the only difference being that those involved are playing exciting, edge-of-the-seat tennis, and we are discussing the work programme of the European Commission.

As the Minister was speaking, I was struck, as I have been before, by how often such debates are taking place inside the Conservative party rather than more widely. It seems to me that the debate inside the Conservative party has governed much of our positioning in recent years, but not to our national advantage.

[Sir William Cash]

Is the right hon. Gentleman effectively saying to UKIP in his constituency that he does not regard the free movement of people and immigration as of any interest to his constituents?

[Mr McFadden]

I do not believe that that is what I said. I am interested in the hon. Gentleman’s intervention, because I thought that the issue for him was principally parliamentary sovereignty, rather than the free movement of people. Perhaps he has shifted his position, and I should stand corrected.

The Minister outlined the position on the numbers in the measures. I noted the scepticism with which the right hon. Member for Wokingham (Mr Redwood) greeted the numbers. I do not propose to go over that ground as the Minister has done so, but on the face of it the Commission is proposing a narrower, more focused programme—under 10 headings and 23 specific measures —than it has in the past.

At the top of the Commission’s agenda is something we would all welcome—an emphasis on growth and jobs. In a continent still struggling to recover from the financial crisis, it is right to have such an emphasis and focus on the very high level of youth unemployment, on doing what is right on the big issues, and on less interference in and over-regulation of issues that do not need it.

In his speech in London last week, Mr Timmermans, the vice-president of the Commission, said:

“It is incredibly important that we follow through on limiting the initiatives we take to those areas where EU action is urgent and needed. For too long we worked on the premise of doing things because they were nice to do; I want to work on the premise that we do it because we need to do it, because Member States can’t do it by themselves alone. There needs to be added value of acting on a European scale.”

I very much welcome that emphasis from Commissioner Timmermans, and I hope that it is followed through in reality as well as in the written plan.

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[Sir William Cash (Stone) (Con)]

I beg to move amendment (a), at end add

‘; and urges the Government to encourage the Commission to develop policies during 2015 relating to the free movement of EU citizens.’

It is truly shocking that it took more than a year for the Government to bring forward a debate on the free movement of EU citizens, given that the document in question was recommended as long ago as January 2014 regarding a matter of enormous significance that was discussed on 5 December 2013 in the Justice and Home Affairs Council. This issue goes right to the heart of the immigration question, which in turn lies at the heart of the European question as it applies to the United Kingdom, and it is a matter of intense political and controversial debate. It is inconceivable that this matter should have been so shockingly delayed, and that led the European Scrutiny Committee to ask the Leader of the House to give evidence and be cross-examined on why these important matters, including free movement as well as things such as the EU budget and the charter of fundamental rights, are outstanding. We were told by the Minister and the Leader of the House that they could not disclose how that decision had been arrived at because it was a matter of collective Government responsibility. The Committee is glad that by tabling the amendment it has forced the Minister to welcome it.

[Jacob Rees-Mogg]

I wonder if I might add to what my hon. Friend is saying. Although the Minister and the Leader of the House said that they could not possibly tell us who was blocking the provision, the Home Secretary, the Foreign Secretary, the First Secretary of State and the Minister for Europe all intimated that they were very much in favour of having the debate, and wished that it could be brought forward as a matter of urgency although forces beyond their control prevented it.

[Sir William Cash]

My hon. Friend is right in every respect and we have all the transcripts to prove it, including from various Secretaries of State. It is effectively an example of decisions being taken behind closed doors in smoke-free rooms. Those are the new modernising methods of government. I disapprove of them and so does my Committee, as shown by the fact that we tabled this amendment.

Let us move on and accept that we are now able to debate free movement; I particularly want to concentrate on EU migration and benefits in that context. I wrote a letter to the Prime Minister on 18 November, which was 10 days before he made his speech at JCB in Staffordshire on the question of free movement, and I drew attention to the fact that I believed we were faced with a real problem. However much we might want to make certain changes, unless we were prepared to dig in and make this Parliament supreme on matters of such vital national interest, we would not get the necessary changes because some of them required treaty change and others required overriding the charter of fundamental rights. Although the Prime Minister accepted in questions after his speech that some of those matters would require treaty change, in reality that is not on offer in any substantial way from the other member states.

The principle of free movement is embedded in the ideology and principles of the other member states, and particularly the European institutions and European Commission, despite how that may affect us as a small island with a greatly increasing population and pressures on social housing and education—the list is endless. Unlike other member states such as France, Germany and Spain that have large land masses and can absorb many more people, we simply cannot do so. It is therefore a matter of vital national interest—quite apart from questions that I will mention in a moment about abuse of the system—that has led us to a position where we have desperately wanted to put our foot down. Some of us believe that we should override European legislation and the charter of fundamental rights by using the “notwithstanding” formula—that is notwithstanding the European Communities Act 1972, which is past legislation as I have said many times before—so that we can ensure that our Supreme Court obeys the laws of this Parliament which is elected by our voters in general elections.

When the election comes—it is only a matter of 60 days or so—this issue will be at the centre of gravity in that election, and we will be asked whether we will take the necessary steps in line with what voters insist on. I am afraid the answer to that question is that there will be no treaty change or overriding of the charter, and when I have asked Ministers and the Prime Minister whether they will use the “notwithstanding” formula, I have been told no.

[Mr Redwood]

On the narrower point of benefits, the Minister gave us encouraging news that we have control of our benefits system, as that is a reserved matter under the treaties. Does my hon. Friend recollect that on several occasions Ministers have been unable to change our benefits system in the way the British public want because of European legal blockages?

[Sir William Cash]

That is completely right. People think—in elements of the BBC and elsewhere, I suspect—that this is somehow a matter of policy, and that by using the right words one can change the effect of European law. No, we cannot. We have to pass legislation. There has to be a majority in this House to override European laws and regulations. It is, ultimately and tragically, a legal framework rather than just simply a question of policy based on the wishes of voters, as expressed by their representatives in Parliament. This has only fairly recently begun to gain traction with some people in the public arena, but not sufficiently, I am afraid, to achieve the kind of impartial analysis I believe is needed, for example in the BBC. Without going into this now, I have invited—in fact, I have effectively forced—the director-general and the editor-in-chief of the BBC to appear before my Committee to explain this problem in the kind of language that ordinary people can understand. That will take place on Wednesday afternoon at 2.30 pm, for those who want to take note.

The Prime Minister’s speech had a lot in it, which demonstrated the extent to which he wants to try to resolve many of these questions. That is undeniable, but the question we have to address, and to which I now turn, is the extent to which it would require treaty change or otherwise—that is the acid test.

My first general remark is that the package includes only one proposal that directly limits or imposes a quota on the number of EU migrants. This would relate to future accessions and so could be part of normal negotiations. However, to impose a direct limit on migration from existing member states would certainly require treaty change.

My second general comment is that many of the relevant treaty obligations have already been interpreted in this context by the European Court of Justice. The Court plays a huge, vital and exceptional role, and cannot be appealed against. It has already interpreted these matters as providing limitation on the action that member states can take in this area. Indeed, the recent case of Dano, which is frequently referred to—the Foreign Secretary referred to it on “The Andrew Marr Show” only this weekend—demonstrates that the Court can change its approach.

However, some of the judgments mentioned are long-standing, well-entrenched and engage charter rights. Any change along the lines suggested by the Prime Minister would therefore not be sufficiently strong, to the extent that they rely on the Court of Justice changing its established jurisprudence. That is why we want the Commission to take account of these points—these are the issues. The European Commission is the legal guardian of the treaties. The point I am making in this speech is that, in order to change the law to ensure that we can actually deal properly with the problems that come from free movement, we have to persuade the Commission, in its work programme, to take account of such relevant questions. It could be inferred from what the Prime Minister had to say that he accepted that some treaty change would be required—and in fact, when he was asked questions, he accepted that towards the end—but there are a number of real problems, and I will now turn to them.

The first problem that the European Commission will have to consider in its work programme is a stronger power to refuse entry and to deport criminals. The free movement directive, which the European Commission has to enforce, requires decisions to be taken on a case-by-case basis on the grounds permissible by the treaty. That provision reflects Court of Justice jurisprudence extending across a wide range of treaty rights, including the freedom to travel to other member states to receive services, which is highly relevant to the work programme. It is likely that any significant stronger action will require treaty change, particularly if it detracts from the requirement derived from the principle of proportionality to look at each individual case.

Secondly, I believe a ban on re-entry for those who have abused EU rights may be possible, as this falls within the public policy exception to the treaty right of free movement. However, there are again questions of proportionality.

[Mr Chope]

Is this not all pie in the sky? There is no way in which the Commission or other member states will agree to these fundamental changes. Is that not why we need to go back to basics and have a free trade organisation without the free movement of people, just as we have free trade agreements with other countries without having to take in all their people as a right, without any control over them? Would it not be better to work towards, for example, visa waiver systems?

[Sir William Cash]

I very much agree with what my hon. Friend says. In fact, if I may say so, I have said it many times in the past myself. However, we have to be able to identify the problems that have been presented by making assertions that we want this and we want that, in order to demonstrate the fact that it cannot be done before we move to the next step, which is of the kind that he and I would want: to address this on a realistic footing and to say to the European Commission, the European institutions and the Government that these proposals are simply not going to stack up because they are not going to happen. There is no chance of a treaty change as far as I can see—my hon. Friend and other hon. Members in the Chamber obviously agree—that will result in getting rid of the dangers presented to the United Kingdom as a result of imagining we will be able to do things, when in practice we know perfectly well it is not going to happen because we will not get the treaty change.

There is also the problem of access to tax credits, housing benefits and social housing for four years. The law of the Court of Justice indicates that an attempt to do this would be contrary to the treaty rights of free movement insofar as the limits on benefit extend to benefits for jobseekers linked to labour market participation and benefits to those who are classified as workers. Such persons are entitled to equal treatment as a treaty right. There is another problem. These things are not going to go away. My hon. Friend is completely right, as I have said so often, not to allow ourselves to be induced to believe that because we say something it will happen, particularly when we are dealing with the acquis communautaire and the rules and regulations that are imposed, which we voluntarily accepted in this House under the 1972 Act. We are the only country of the 28 member states that has the right, because of our constitutional arrangements—we do not have a written constitution—to make changes and override that legislation if we so wish to do. We can do it. The question is: have we got the political will in relation to matters of vital national interest?

Any restriction on access to social housing would likely be regarded as discrimination on the grounds of nationality. Thus, that too would be contrary to the treaty. There is then the question of removal if jobseekers do not find a job in six months. The law of the European Court of Justice overrides even this Parliament, by our voluntary agreement, but we can unwind it if we wish to do so by using the notwithstanding formula to override it and pass a law in this place. If jobseekers do not find a job in six months and are faced with removal, we could legislate. Under sections 2 and 3 of the European Communities Act, however, Court of Justice law prevents it, on the grounds that it interferes with the treaty right of free movement—insofar as a jobseeker can demonstrate that he or she is continuing to seek work and has a genuine chance of being engaged. Thus—again—treaty change is likely to be necessary.

Then there is the requirement for a job offer before entry—the same case law points to the requirement for treaty change on that account, too. Then there is the further restriction on the entry of non-EU family members. The rights of family members to enter with someone who has rights as an EU worker are set out explicitly in the free movement directive and could in principle be adjusted by amendment to the directive, but limits to wholesale change are set by the requirements not to undermine the essence of the treaty right of free movement and to respect human rights.

As I mentioned in my lead letter in yesterday’s The Sunday Telegraph, there is also the problem of human rights issues in respect of the deportation of terrorists, who can also insist on the right to family life under the present arrangements. We have to get real about this. We have to change it. So far, the Court has taken a consistently firm approach in favour of ensuring family life where these matters arise in the context of free movement, and it is likely to continue to do so—with huge implications for the number of people who can enter.

Finally, there is the question of whether there should be no child benefit for non-resident children. The requirement to pay child benefit for children in another member state is currently in the social security co-ordination regulations. It is theoretically possible to amend the regulations to end these payments, but it would raise the serious question of indirect discrimination on nationality grounds—again contrary to treaty free movement rights— and the same would apply to the proposal to limit child benefit paid abroad to that paid in the child’s country of residence.

I do not mean to criticise for the sake of it. I have tried to present the House with a proper examination and legal analysis of the problems, which would not have been the case had we not been able to debate the amendment, and it is now on the record that these are serious problems that cannot simply be washed away with fine words and which in most cases will require treaty change. When I wrote to the Prime Minister 10 days before his speech, I asked if he would be good enough to seek the advice of the Attorney-General and Government lawyers on the questions I raised. I trust that the House, the Minister and the Prime Minister will listen, and that we will take the steps necessary to deal with the vexed issue of immigration in a manner that overrides the treaties and the charter, as and when it is in our vital national interest to do so.

[Several hon. Members]

rose—

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[Jacob Rees-Mogg (North East Somerset) (Con)]

Let me begin by talking about the way in which we have arrived at this debate, and also about the amendment that has been tabled by my hon. Friend the Member for Stone (Sir William Cash) and all the other members of the European Scrutiny Committee who were present at Wednesday’s meeting. It is highly unusual for a Select Committee to table a cross-party amendment on a subject that was recommended for debate nearly 14 months ago.

The Government should bear it in mind that no Government are in office for ever. They should bear it in mind that the great protection of our liberties is the House’s entitlement to debate what it wishes to debate, and that they should treat that entitlement properly and respectfully by allowing such debates to take place. They should also bear it in mind that delaying deliberately, for 14 months, a debate on the free movement of people—a subject which, as we heard from the hon. Member for Luton North (Kelvin Hopkins), is being discussed on every doorstep in the country—shows a contempt for the House of Commons that constitutes a grave error.

When things change and another party is in government, that party too will notice that it is possible to ignore the Standing Orders of the House. That party too will notice that it is easy to clamp down on discussion in what ought to be a hotbed of democracy, and our freedoms will ebb away.

The Government ought to be ashamed of themselves for their delay, and the Ministers who claimed to be so much in favour of the debate when they appeared before the European Scrutiny Committee—or on the Floor of the House during questions to the Leader of the House—ought to recognise that they are powerful figures. When the Home Secretary, the Foreign Secretary, the Minister for Europe and the First Secretary of State all want a debate, it is extraordinary that we do not get that debate. Who is the mystery figure, hidden somewhere in the corridors of Whitehall, who vetoes debates?

[Sir William Cash]

Clegg.

[Jacob Rees-Mogg]

Is it our right hon. Friend the Member for Sheffield, Hallam (Mr Clegg) who vetoed the debate, or is it simply some mystery in the machine? Is it some faceless bureaucrat, some poor fellow sitting patiently in the officials’ Box?

Ukraine (UK Relations with Russia)

William Cash Excerpts

Thursday 11th December 2014 Commons Chamber

[Mr McFadden]

My hon. Friend is right to draw attention to the recent £7 million loan to the French National Front party, and to return us to the question of who would cheer if the European Union were to fall apart at the hands of nationalist movements and parties. For the rest of us, such comments and actions are a reminder that we should not be cavalier in dismissing the importance of the security side of a strong and united European Union which believes in democracy and freedom, and stands opposed to Russian aggression. That is well understood by Angela Merkel, who, a few days ago, told Welt am Sonntag:

“Moldova, Georgia and Ukraine are three countries in our eastern neighbourhood that have taken sovereign decisions to sign an association agreement with the EU”.

She added:

“Russia is creating problems for all three of these countries”.

We cannot regard those countries’ actions as poking the bear with a stick. They have a right to sign such agreements if they wish.

[Sir William Cash (Stone) (Con)]

I want to ask a very simple question, namely whether and to what extent the right hon. Gentleman agrees that it is necessary to take action along the lines of that suggested by my hon. Friend the Member for New Forest East (Dr Lewis). Does he think that the European Union will actually decide that it will regain Crimea, and if so, how? Does he also think that we will effectively back up the threats that are being made with real action?

[Mr McFadden]

I think that the unified European Union response on sanctions has been helpful in that context, but, as I have said, NATO is our principal source of collective defence. Let me also say to my hon. Friend that if he secures the policy for which he has worked for many years, he should bear in mind who will be cheering most in the context that we are currently discussing.

EU Reform

William Cash Excerpts

Tuesday 18th November 2014 Westminster Hall

[Sir William Cash (Stone) (Con)]

It is a great pleasure, Mr Robertson, to serve under your chairmanship. In 1997, shortly after the Maastricht rebellion, Thomas Kielinger of Die Welt wrote a pamphlet entitled “Crossroads and Roundabouts” about Germany and the United Kingdom in Europe—the contrast between the German vision of Europe and the UK’s commitment to its Parliament and its own national interest. We have done the roundabout; now we are truly at the crossroads of the EU and perhaps even of our relationship with Germany. Is it really the case that in this country we are disproportionately preoccupied with our own national concerns?

I am introducing this debate about the UK and Germany in the EU—the first devoted specifically to the subject, I think—about which, in the interests of our mutual relationship, we must be both realistic and straight with each other, as we were yesterday in discussions with the Bundestag European affairs committee.

I warned John Major before Maastricht that the treaty, which I urged him to veto, would lead to a European Government and a German Europe. I campaigned for a referendum on that and the petition to Parliament received many hundreds of thousands of signatures. In my book of that time, “Against a Federal Europe”, I wrote:

“The answer to the German question lies primarily in Germany itself and that to hand her the key to the legal structure of Europe with a majority voting system gravitating around alliances dependent on Germany simply hands her legitimate power on a plate.”

That is now becoming clearer by the day. I also wrote then:

“Britain wants to work together with Germany in a fair and balanced relationship, based on free trade, cooperation and democratic principles. She does not want to be forced into a legal structure dominated by her. Plans for a united Europe stray into the darkest political territory, and must be firmly rejected.”

I wrote that in 1991. In 1990, I had written that

“if Germany needs to be contained, the Germans must do it themselves…now is the time for the Germans to prove themselves”.

In the words of the German philosopher, Thomas Mann, in 1953:

“We do not want a German Europe, but a European Germany.”

I argued that we were embarking on

“a European Germany and a German Europe”

because the two ran together after Maastricht. As Bismarck himself said:

“I have always found the word ‘Europe’ on the lips of those politicians who wanted something from other Powers which they dared not demand in their own names.”

He meant their own national interests. It is also to be recalled that, as Friedrich Karl von Moser stated:

“Each nation has its main characteristic. In Germany it is obedience. In England it is liberty.”

[Mark Field (Cities of London and Westminster) (Con)]

My hon. Friend and I have talked many times about these matters, for obvious reasons. Does he accept that a British exit from the European Union would be the single most likely thing to provide the German dominance of Europe to which he refers? Is it not very much within the modern German mentality to see the European Union as a way of containing elements of some chapters of their history—of which, understandably, they are not proud? They see a strong European Union as being the way in which the dominance of Germany can be kept at bay.

[Sir William Cash]

I understand that point and my hon. Friend has made it to me before. All I can say is that it depends on the structure being created and the irreversibility established by the treaties themselves as put into legislation. As I shall explain in a moment, the consequence of the existing structure is to create an imbalance in favour of Germany and a disadvantage for the United Kingdom in several areas. That is what we must evaluate because we want a peaceful and stable Europe; unfortunately, however, what is happening now is creating instability, and I believe the European Union as it was conceived will ultimately be undermined. Our parliamentary system is the bulwark of the liberty and democracy that saved us and Europe. That is no anachronism today.

The problem we now face in an increasingly assertive German Europe is one increasingly at odds with British national interests. For me, that was one of the mainsprings of the Maastricht rebellion and it has been exacerbated by successive treaties, including Lisbon—against which, notably, the Conservative party was united.

The situation is getting worse. For example, we are told that the single market is the prime reason, or certainly one of the prime reasons, for our engagement in the European project. Although more than 40% of our trade is with Europe, our trade deficit with the other 27 member states is £56 billion, whereas the German surplus with the same member states is £51.8 billion. At the same time, we have a substantial surplus with the rest of the world with the same goods and services. I fundamentally disagree with the CBI’s analysis.

A host of individual problems give rise to concern—for example, the regulatory system in the City of London. I wrote about that in the Financial Times, warning the City against the consequences, and we have lost case after case in the European Court of Justice. There is the ports regulation, opposed by port employers and the trade unions. There is the change in the patent courts system. There is the lack of a reciprocal policy of liberalisation in relation to energy, professional services and other matters. There is over-regulation, particularly of small businesses, on which no substantial progress is ever made, and which is calculated to cost about 4% of EU GDP.

The effect on our economy is deep. Our growth is being dragged down by the sclerotic eurozone, whose problems in many countries, such as Italy and Greece, are blamed on German currency and export manipulation.

[Mr Jim Cunningham (Coventry South) (Lab)]

The hon. Gentleman mentioned the single market. Logic says that anyone signing up to a single market gets a central bank and a single currency. Surely the horse has bolted. I remind the hon. Gentleman that it was the Labour party that gave the British people a referendum and the five economic tests.

[Sir William Cash]

I entirely accept the hon. Gentleman’s second point about the referendum; I have never disputed that. Far from it—it was an extremely good thing, although back then it was about a kind of Europe different from the one we are now experiencing.

I voted for the Single European Act, but I tabled an amendment to preserve the sovereignty of the Westminster Parliament. If that amendment had been allowed for debate, which it was not, it would have changed the whole nature of the matter. I was strongly supported by Enoch Powell, who understood that if we were to have a single market that did not work, the only way to retrieve the situation would be through some form of “notwithstanding” formula of the sort I have returned to over and again in subsequent years.

German economic policy is obsessed with fiscal discipline and large current account surpluses. Without the euro, currency adjustments would control Germany’s ability to export cheaply. German economic efficiency, combined with the single currency, allows for artificially cheap German exports at the expense of Mediterranean countries, which can deflate their currencies to offset cheap German goods, drawing money and jobs north and leaving the southern Governments unable to finance their deficits through economic growth.

German insistence on fiscal discipline is, as Wolfgang Munchau made clear in yesterday’s Financial Times, ideological and a deeply held response to the crisis of the 1930s. The result will be the destruction of the Mediterranean export economies while simultaneously deepening the damage through austerity on a massive scale. An attempt to impose German-style labour laws and fiscal discipline on those countries will fail and will not bring the required efficiency to compete with Germany.

The eurozone, which is dominated by Germany, is a disaster, as is increasingly recognised publicly by some of my Labour colleagues, and it seriously damages our economy. Furthermore, although we are told that consensus is the norm, the political consequences of the present treaties mean that, as of 1 November this year, the majority voting system in the EU Council of Ministers has been profoundly changed, subject only to a compromise transitional arrangement called the Ioannina compromise.

Germany and France with two small states can now effectively determine European decision making. The consensus is insufficiently transparent and is achieved primarily because the member states know the outcome of a given vote, which in any case does not sufficiently correspond to our concerns. In my European Scrutiny Committee, we have been very critical of how Coreper functions and the manner in which we are unable to achieve our objectives. We also have some critical things to say about UKRep.

Indeed, VoteWatch Europe has demonstrated that when the UK has voted between 2009 and 2012, it has done so in favour with the majority of member states in 90% of all votes. That strongly suggests that most European Commission proposals go through in practice. Therefore, the change in the voting system will tend to affect British interests increasingly adversely.

Professor Roland Vaubel of Mannheim university has examined the voting system and argued that the outcome is one of regulatory collusion, favouring Germany in particular. One must recognise that Germany makes a very substantial net contribution—£13 billion in 2013 compared with our £8.6 billion, although our contribution is rising. In return, Germany now acquires disproportionate advantages under the voting system and through its economic influence in Mitteleuropa.

In his speech in Berlin on 13 November, John Major reinvoked the concept of subsidiarity and he did so again on “The Andrew Marr Show” on Sunday. He said that subsidiarity is the answer and that we must

“nail it down as a matter of European law”.

I do not know which planet John Major has been living on since Maastricht, but that is already a matter of EU law. When he promoted subsidiarity in the Maastricht treaty, I described it as a con trick. In my 30 years on the European Scrutiny Committee, I have never come across a single example of the direct application of subsidiarity. Even John Major now reports its failure, and his speech in Berlin was a catalogue of the failures of his European policy at Maastricht.

The European Union is not an abstract concept. It is about the daily lives of our voters, to whom we are directly accountable, across a vast range of matters. The list of chapters in the consolidated treaties sets out the immense impact that the European Union now has on us all.

The European Scrutiny Committee, of which I was elected Chairman in 2010, argued strongly and unanimously in November 2013 that the Government should reintroduce the veto. We were promised that the veto would never be abandoned when the White Paper was issued in 1971; that was the basis of our voluntary acceptance of the treaties by our Parliament in the passing of the European Communities Act 1972, yet so many other additional competences have been added since. That paper described the veto as being in our vital national interest, and stated that to abandon it would even endanger “the very fabric” of the European Community itself. Somebody out there understood where all this could lead, as it has.

The Prime Minister, to his credit, did veto the fiscal compact, although my right hon. Friend the Member for Wokingham (Mr Redwood) will remember a conversation that we had with him shortly beforehand. My Committee proposed the application of the formula

“notwithstanding the European Communities Act 1972”

to our Westminster legislation when it is in our national interest to do so. We could thereby override European laws and the European Court of Justice when necessary, as we can and should, under our own flexible constitutional arrangements unique to the United Kingdom among the 28 member states, thus regaining our right to govern ourselves in matters of vital national interest.

Those proposals were rejected by the Government, which shows how weak our negotiating stance really is in relation to the need to change fundamentally our relationship with the EU in the interests of our parliamentary democracy and the needs of our voters.

[Dr Julian Lewis (New Forest East) (Con)]

Am I right in thinking that my hon. Friend has referred to the fact that Germany—the country on which this debate is focused—has a sort of parliamentary supremacy as a safeguard in its legislation, and that that is what he has tried to introduce for the United Kingdom? Can he tell us how well it works for Germany?

[Sir William Cash]

The short answer is that in the German constitution, in the preamble to the Basic Law of 1949, an assumption is built in for a united states of Europe. Unfortunately, therefore, a change in the German constitution would be required to enable the Karlsruhe court to override the provisions of the Basic Law. Therefore, Germany faces a real constitutional question that we do not, because we do not have a written constitution and we have the inherent right, within our own Parliament, to make the kind of adjustments that we want in this area.

To refuse to accept our Committee’s proposals—I say this with great respect to the Minister—is not merely walking away; it is not even engaging with the real problem, which is the dysfunctional structure created by successive treaties and the disadvantages that that creates for the United Kingdom.

All that demands a direct return to democratic accountability at Westminster—not the Maastricht-based co-decision with the European Parliament, which I opposed at the time, and not the manner in which the majority voting system and the so-called consensus have led to us being put at significant disadvantage from time to time in matters of our national interest. Those are increasingly becoming a matter of concern following the change in the voting system as of 1 November.

[Mark Field]

Does my hon. Friend not accept that many in continental Europe would say that Britain has a permanent exclusion from the single currency, is not signed up to the Schengen agreement, and in fact, under Maastricht, was also exempt from the social chapter, although that exemption has now gone? He talked about the fiscal compact, which technically speaking was not a veto, but essentially was done at eurozone level.

If we are going to continue to opt out, does my hon. Friend not recognise the concern that, as we become ever more marginalised from the centre of Europe, the case for staying in the European Union will become ever weaker? Is that the path down which he now wishes to take us, and if so—

[John Robertson (in the Chair)]

Order. The hon. Gentleman will have the chance to make a speech later.

[Sir William Cash]

I have said many times on the Floor of the House that I think we have reached the point where we will have to leave the treaties, for all the reasons that I have given and will give. The opt-outs are merely indications of the profound uncertainty with which Britain entered the European Union in the first place. As I pointed out, the veto was a completely unconditional promise for the future, and that has now been whittled away. As I will explain, there are more and more reasons why we are at the exit door. Those are not purely economic, but political.

The European project, based on Maastricht and the successive treaties, has undermined the credibility and efficacy of European integration. That is now reinforced by the practical and visible impact of endemic protests and riots in the streets of European cities and by vast unemployment in several member states, in which youth unemployment has reached obscene levels of up to 60%. I predicted that when I wrote about it in the early 1990s, and I added that it would be followed by massive waves of immigration from central and eastern Europe when the Maastricht system failed, with the consequent emergence of the far right. No one can say that that has not happened now.

[Mr John Redwood (Wokingham) (Con)]

Does my hon. Friend agree that the Germans’ problem now is that to make a success of their single currency, they need a political union with massive transfers of money from the rich parts to the poor parts of the union, as we have in the sterling currency union or as exists in the dollar currency union, but that is exactly the kind of system that the United Kingdom would never accept, and that is why, at the crossroads, we need a different relationship?

[Sir William Cash]

That is completely right. We need a different relationship with the EU as a whole that also includes the eurozone, because the eurozone, which is causing so much of the dislocation in Europe, is dominated by Germany, and the German financial and fiscal policies, which I have described already, have that enormous impact in destabilising the eurozone.

This is where I really part company with statements made by some members—senior members—of our Government. I am referring to the consequences of the eurozone. We were told at the time when it was evolving, with the banking union and all the rest of it, that it was, in effect, a natural course of events that we could not prevent. Actually, it has created the very instability that is most likely to lead to the destruction of the European Union itself. That is the problem. It is not just a negative view that I am trying to put across; it is the fact that it is destabilising Europe. It is creating problems of a kind that can get completely out of control, with catastrophic consequences not only for this country but for Europe as a whole. That is why the argument that I am seeking to advance is that actually this is a real problem for Europe as a whole. It is not anti-European to be pro-democracy.

[Mr Jim Cunningham]

It was remiss of me not to congratulate the hon. Gentleman on acquiring the debate. I know the views that he has held over many years. My point is this. During the last economic downturn, the Germans, for example, did not dictate British economic policy; it may be argued that British economic policy was dictated to Europe. I do not see the hon. Gentleman’s logic. If he feels that the European market as it is constructed now is causing major problems in Europe, why should we pull out of that situation, rather than rebalancing Europe? That is what I do not understand about the argument that he is making.

[Sir William Cash]

The short answer to that is that we do not need to be in the European Union to trade with Europe, because it needs us—for example, in relation to Germany’s export of cars—on a monumental scale. I have already given the figures for the surplus that Germany runs with the other 27 member states. Furthermore, we have a global economy to which we can address our economic and trading concerns, and we are achieving a substantial surplus with the rest of the world, selling the same goods and services. What I am arguing is on the balance of judgment as to whether it is in our interest to subordinate our parliamentary system of government and the democracy that goes with it in order to achieve a trading relationship that at best is extremely debatable and, in certain instances, is positively disadvantageous.

Let me turn to the issue of defence, which is so fundamental to our national interest. Unlike John Cleese’s immortal words in “Fawlty Towers”, “Don’t mention the war”, we must never forget the reasons why we were confronted in two successive world wars by unprovoked aggression from Germany. We must look to the greater historic landscape in our mutual interests and we must look to resolve our real differences about the structure as well as individual issues within the EU.

Ten days ago, at a formal conference in Rome under the Lisbon treaty, comprising chairmen of national parliamentary committees for all 28 member states and the European Parliament, the German delegation formally proposed a defence Commissioner and a defence Council of Ministers and reinvoked the idea of an EU military headquarters. As Chairman of the European Scrutiny Committee, I argued passionately against that, as did the right hon. Member for Gordon (Sir Malcolm Bruce) and the hon. Member for Ilford South (Mike Gapes), the former Chairman of the Select Committee on Foreign Affairs. The British delegation defeated the proposal, but the German delegation insisted that

“it will have to be put back on the agenda at the next conference”

and added ominously that

“Great Britain will simply not be able to maintain their line”.

That harks back to previous German attempts to establish a European defence policy with majority voting and must be repudiated once and for all.

[Sir Gerald Howarth (Aldershot) (Con)]

My hon. Friend is making a very important point because, as he knows, defence is the only area of European activity—I will not call it policy—where the United Kingdom still has a veto, a veto that I twice used to prevent any increase in the budget of the European Defence Agency. But is he also aware that the former Foreign Secretary, our right hon. Friend the Member for Richmond (Yorks) (Mr Hague), and I, at the Foreign Affairs Council meeting, vetoed the idea of an operational headquarters for the EU, because it would have served further to undermine the cornerstone of European defence, which is the North Atlantic Treaty Organisation? We must resist any further attempt by the Germans, the Poles or the French to create a defence identity within the EU.

[Sir William Cash]

We are all indebted to my hon. Friend for his time in the Ministry of Defence. What he said is well known to me, but ought to be better known outside the House. This is crucial. The question, whether we have an EU military headquarters moves us into very dangerous territory. I will show my hon. Friend the full transcript of the exchanges between me and the German delegation on this matter. I do not have time to go into it now, but I can assure him that I set out some very powerful arguments, including by making reference to article III of the 1990 treaty, which dealt with the question of the restrictions on Germany in relation to the manufacture and distribution of nuclear weapons, which went back to the original NATO treaty of 1949. Also, of course, I mentioned in particular the role of NATO in relation, for example, to the Baltic states and the rest of it. NATO is there; it is the cornerstone, as my hon. Friend rightly says.

[Mark Field]

I very much agree with what my hon. Friend has said and with the intervention by our hon. Friend the Member for Aldershot (Sir Gerald Howarth), but does he not think that we would be greatly assisted in making the case for ensuring that there is no change in the European defence mechanism if we honoured our own commitments to ensure that at least 2% of our GDP is spent on defence and, given the insecurities of this world, rather more in the years to come?

[Sir William Cash]

I very much agree with that. Of course, there is this wave of counter-cyclical agreement and disagreement between my hon. Friend and me. Actually, that is encapsulated in a personal matter. We were, through our respective families, involved in the battles in Normandy, which I will not go into now, but which he knows about and I know about and which were extremely poignant and extremely relevant to what went on at that time.

[Mark Field]

My hon. Friend is far too modest to go into great detail or perhaps did not want to embarrass me, but I should point out that although his father served in the British Army, my great-uncle was serving in the Panzer regiment for the opposite side during that particular battle.

[Sir William Cash]

That was on 10 July 1944. My father got the military cross, and my hon. Friend’s great-uncle was on the other side, but there we are.

We must also—this is very delicate territory—remain clear that the United States, which has for more than 50 years impressed on the United Kingdom the importance of a more integrated Europe, must not be allowed to persuade us against our national interest in relation to the question of defence. However, this is not by any means only about defence. As I have explained, it is also about our economy and our trading relationships, which are punctuated by constant tensions embedded in our European relationship that, to a greater or lesser degree, are based on our alleged obligations under European law.

Most recently there was the budget surcharge issue, but there are also disputed areas of policy such as the European arrest warrant and, of course, the current wave of concern over immigration and freedom of movement, on which we are warned against infringing European law and on which we had very interesting exchanges with the Bundestag’s European affairs committee yesterday. It takes the view that one has to distinguish between workers and people, and that it is our fault that we have ended up where we are now, but as the shadow Minister, the right hon. Member for Wolverhampton South East (Mr McFadden), heard me say last night, of course we believe that that was the consequence of decisions taken by the former Labour Government. But there we are.

It must be said, however, that the European rule of law is itself a moveable feast at the whim of certain states. For example, in 2003, Germany and France themselves broke the stability and growth pact with impunity when it suited them. We are currently reminded by a proliferation of articles and books about the collapse of the Berlin wall that the German question, and its embodiment in European and our own and their political history, remains a constant national interest. In fact, very rarely do we talk about Germany in this country, but in Germany and in France they talk about it almost incessantly. Indeed, I recall taking part in a debate on the future of Europe in the then dilapidated Reichstag when the Berlin wall was still up, and putting my hand against the wall itself, and I recall a member of the German delegation vigorously waving his arms as I heard him through the Bakelite headphones vociferously remonstrating that, as he put it,

“my heart and soul rages with fervour and passion at the thought of a single government and a single parliament in this Reichstag.”

I warned the meeting that such language would merely rekindle old tensions—and that was before the wall came down.

As Peter Watson, who rightly reminds us in his book “The German Genius” about the great contribution of Germany to industry and art, said in a book review last week,

“no one has yet succeeded in explaining the collapse into barbarism that followed the First World War.”

I would add that nor has sufficient attention been given to the question of how to deal with a European Union—created to avoid everything that had happened in the aftermath of the first and second world wars—dominated, as it now is, by a peaceful but assertive Germany, based on a framework delivering supposedly irreversible policies that have delivered instability throughout Europe and vitally affected our own economy, our national interest and Westminster democratic accountability. Insufficient attention has been given to how we deal with that problem, and it is not just for us but for all the European member states, and Germany in particular.

Furthermore, far from containing German domination of the EU, the treaties have stimulated it. For all the protestations, the European Union has morphed into an increasingly undemocratic Europe, with Britain unacceptably relegated to the second tier and with Germany largely predominant over the whole, as well as the low-growth eurozone.

The Prime Minister was entirely right to state in his Bloomberg speech:

“Our national Parliament is the root of our democracy.”

We must address the question of a fundamental change in our relationship with the EU and the reassertion of sovereignty at Westminster and in our democracy. Those are the reasons why we were able to prevail in the dark days from 1940 to 1945, and we must not underestimate their importance today. Now we must do so again on those principles, but in very different circumstances. It is not enough merely to reform at the margins. We must resolve the European, and therefore the German, question in our own time. If negotiations for that purpose, above all else, cannot be resolved, we must leave the treaties and lead Europe on the right road to stability and peace, both for ourselves and for Europe—including Germany—as a whole. We must be, as Churchill said, “associated, but not absorbed.” For that purpose, we must pursue a policy of an association of nation states.

The Prime Minister’s purported renegotiations do not, at present, tackle the fundamental structural question of the treaties. The Foreign Secretary is right to indicate that we must never go into a negotiation unless we are prepared to get up from the table and walk away, but it is essential that we are told what our red lines are, and that they address the fundamental changes that we need within the EU. Immigration is, of course, a major issue, but the question of our borders is not simply a question of immigration. It is a question of parliamentary democracy and jurisdiction, and therefore it is about more than the symptoms of our problems with European integration and its impact on our entire political and economic national interest. Trade alone is not the arbiter of freedom and democracy; it flows from them, as do the laws that affect our economy and that have been so disadvantageous to us, as I have indicated already, in many areas.

The renegotiations cannot be successful in our national interest without a fundamental change in the architecture of the European Union. If we do not renegotiate and achieve such fundamental change, Germany’s predominance in the project will increase and the United Kingdom will be required to leave the EU. We must not be continually subjected and subordinated to being in the second tier of a two-tier Europe.

We are now at an historic moment at the crossroads of the European Union, which can be evaluated only on a broad historical landscape. I voted yes in 1975, and I attempted to reserve our Westminster sovereignty in the Single European Act in 1986. Maastricht and European Government changed all that. Britain and Germany have historically had, and still have, very different visions of Europe. We look to our borders, and Germany looks towards a broad, roaming European vision—a political union without borders.

Not so long ago, I referred in the book I mentioned, “Against a Federal Europe”, to Hans-Dietrich Genscher, who was Foreign Minister of Germany for 15 years and was one of the most powerful architects of reunification and the current European Union. Although he repudiated his former loyalties, Genscher stated:

“We Germans can be the architects of a united and indivisible Europe”

and that a strong Germany was good for Europe. In my analysis in 1999, from which I do not demur, I said that the assertion of a strong Germany being good for Europe

“begs many questions. Germany’s economic strength derives from the fact that she saturates the EC”—

as it was then—

“and Eastern Europe with her exports; if as seems likely, she consolidates this position via the single market, while gaining de facto control of the single currency, one could well envisage a scenario in which a strong Germany was bad for Europe. If industries in other countries were weakened or depleted by German domination and if the single currency removed the competitiveness of weaker economies, while the social charter…insulated German workers from competitively low wages abroad, then one could well imagine economic decline and rising unemployment on the periphery of the EC financing the German stranglehold.”

Who would argue today that that has not happened? I noted that at the 25th anniversary of the collapse of the Berlin wall, when Dr Michael Stürmer was asked on “Newsnight” how Germany had achieved such predominance, he indicated that it was “by default”. I reserve judgement on that.

Furthermore, we are not simply talking about Germany’s economic impact on other member states, whatever subsidies or defensive alliance through NATO they may receive in return. As I have said, the preamble to the German Basic Law of 1949 includes a policy leading to a United States of Europe as one of the constitutional foreign policy goals of Germany. As all those factors have aggregated, it has become ever more important for the United Kingdom to look to its own future. To that we must turn our determined attention, while seeking peaceful co-operation and trading relationships within Europe and with Germany. There will be no peace in an unstable Europe, which will implode with disastrous consequences. Such instability is inherent in the imbalanced structure of the whole, not only of the eurozone. We all want peace in Europe, but to ensure such peace we must restructure the treaties, not simply tinker with them.

We must clearly put this to Germany and the EU as a whole. The United Kingdom cannot and must not allow our democracy, in this Parliament, from which all political and economic action flows and which has saved Europe and herself for generations, to be in any way compromised. As William Pitt stated in his Guildhall speech in 1805:

“England has saved herself by her exertions and will, as I trust, save Europe by her example.”

[Several hon. Members]

rose—

--- Later in debate ---

[The Minister for Europe (Mr David Lidington)]

Mr Robertson, I welcome you to the Chair this afternoon. I also welcome the right hon. Member for Wolverhampton South East (Mr McFadden) to his first outing in Westminster Hall with his new responsibilities. In addition, I congratulate my hon. Friend the Member for Stone (Sir William Cash) on securing the debate. He and I have been discussing these issues for about 25 years—

[Sir William Cash]

Since 1990.

[Mr Lidington]

“Since 1990,” my hon. Friend reminds me. And as I will make clear in my remarks, there are some things that we agree upon and other things where there are perhaps some divergences in our respective approaches.

I will start with those areas on which I can find ready agreement with what my hon. Friend said in his opening remarks. I agree with him and other hon. Members when they say that the current levels of unemployment and low growth in Europe are a scandal and a cause of human misery, as well as an important cause of the widespread public discontent and anxiety that we see right across the continent. I also agree with those who have argued today that those economic challenges need to be addressed by a vigorous programme, primarily of supply-side reform, at both national and European level, focusing on the liberalisation of markets, especially in services, on deregulation and on embracing the opportunities offered by free trade. Those economic reforms are right not only for the UK but for Europe as a whole. I also say to hon. Members, frankly, that whether this country were in or out of the EU, endemic low growth and high unemployment in the rest of Europe are very bad news for businesses in this country, given the high proportion of our trade that is done with other EU companies and member states.

I agreed with what my right hon. Friend the Member for Wokingham (Mr Redwood) said when he expressed relief that this country had decided not to take part in the euro. I agree that that would not have been in this country’s interests and I continue to believe that it is not a project that it is in our interests to take part in.

I also agree that for those partners that have committed themselves to membership of the euro, the logic of a single currency and a single monetary policy must be for closer integration of economic and fiscal policy decisions, and in turn for there to be political arrangements to hold such decisions accountable. One of the central political questions for the EU in the years to come—the next decade or so—will be whether we can construct arrangements within Europe that permit those who have committed themselves to a single currency to integrate more closely, while genuinely respecting, and in full, the rights of those who choose to remain outside the euro. That also means ensuring that the EU, in both its rules and its working culture, guards against the kind of caucusing that my hon. Friend the Member for Stone warned us might be a possibility—a caucus among eurozone countries, effectively to write the rules for everybody else regardless of others’ interests or views.

I also agree with the case for more wide-reaching political reform at European level. The EU is too centralised, and is often too bossy. As the hon. Member for Strangford (Jim Shannon) said, we need to have an EU that shows greater flexibility and that is better able to accommodate the diversity that is needed among the 28 member states that there now are, rather than the six member states the EU started with.

There was some discussion about defence. I agree with those who argued that it is NATO and not the EU that is, and should remain, the key alliance for the maintenance of the security of this country and of Europe as a whole. As my hon. Friend the Member for Aldershot (Sir Gerald Howarth) said in an intervention, we still have a veto in regard to Europe’s common security and defence arrangements and we have exercised that veto in the way that he described.

Ukraine

William Cash Excerpts

Monday 28th April 2014 Commons Chamber

[Mr Hague]

The hon. Gentleman makes a good case for that. We have those more far-reaching sanctions in preparation. It is very important to keep like-minded countries together on this—that is a major consideration for us. That means the whole of the European Union and G7 acting together. It is certainly the majority consensus opinion that targeted sanctions—followed later, if necessary, by the more far-reaching measures—is the way to do this. Hon. Members on both sides of the House have advocated taking more far-reaching measures now, but I think on balance it is right to stick to the calibrated approach that I advocate and that the right hon. Member for Coventry North East (Mr Ainsworth) has commented on. It makes it clear to Russia that such measures will follow a further serious escalation of this crisis.

[Mr William Cash (Stone) (Con)]

Does the end game of the Foreign Secretary and the European Union include the requirement on Russia to disgorge Crimea, given the arrangements under the association agreement that were agreed in the conclusions of the EU summit a few weeks ago?

[Mr Hague]

The association agreement and any other actions or documents of the United Kingdom and the European Union are not going to recognise the annexation of Crimea. It cannot be accepted internationally. That is why we are also looking in Europe at the economic measures we are going to apply to Crimea in its current condition, annexed by Russia. The only agreement we have with Russia on these matters is the Geneva agreement, which relates to de-escalating tensions in Ukraine. That is what the international community has come together to require.

Ukraine

William Cash Excerpts

Tuesday 4th March 2014 Commons Chamber

[Mr Hague]

We are working on two things in the OSCE, and I mentioned that urgent consultations are taking place in Vienna. One is the deployment of monitors to try to avoid the flashpoint we have been talking about. So far, Russia is refusing to accept such monitors in Crimea, but perhaps we can do more in other parts of Ukraine. We are also working on the creation of a contact group to try to open a new diplomatic channel and a forum for Russia and Ukraine to discuss things together. So far, Russia has not accepted that idea either, but we are continuing to pursue both ideas.

[Mr William Cash (Stone) (Con)]

Given what the Foreign Secretary said about his recognition of the sensibilities of Russia in this situation, does he recognise that the EU’s ambitions for the Eastern Partnership and the association agreement over the past 18 months have borne some responsibility for the relationship between Russia and Ukraine? That is especially so given, for example, the express views of an EU diplomat last November, who stated—even threatened—that the Ukrainian leadership would have to come to the EU on their knees if they did not do what the EU wanted.

[Mr Hague]

We are talking about an association agreement that remains on the table between the EU and Ukraine, and a deep and comprehensive free-trade area. That is similar to something that Ukraine would willingly enter into. There is no requirement from the EU that it does that, and it is a very different thing from EU membership. It was being discussed with the Yanukovych Administration, because they wanted to discuss it with the European Union. I assure my hon. Friend that from everything I have seen in Ukraine, having been there on Sunday and Monday, there is strong political unity in that country that welcomes seeing the back of President Yanukovych, and that wants to enter into closer association with the European Union. That is its sovereign right and decision, and we should be prepared to defend its right to make those decisions.

Ukraine, Syria and Iran

William Cash Excerpts

Monday 24th February 2014 Commons Chamber

[Mr Hague]

I am pleased that the hon. Gentleman has returned safely, and I will pass on his thanks to our ambassador. We are already conveying those messages through our embassy. I have asked to talk to the Speaker who has been declared the acting President—[Interruption.] I am not sure about encouraging that thought, Mr Speaker. I have asked to speak to the acting President to convey the message from the UK that the new Government should not be as divisive as the old one so evidently was. They should seek reconciliation and be a true unity Government who try to establish a new political culture. If they do those things, they will receive a great deal of international support.

[Mr William Cash (Stone) (Con)]

The Foreign Secretary may know that the EU-Ukraine association agreement is still under scrutiny in the European Scrutiny Committee and will certainly require a debate. It is important that he has mentioned the fact that the International Monetary Fund, and not the EU, should be the lead on this. The amount of money that could be required of the United Kingdom in the light of an EU financial deal could be so horrendous as to make it completely unacceptable.

[Mr Hague]

I have consciously tried to reassure my hon. Friend on that matter. I deliberately mentioned IMF support. There will be opportunities for European Investment Bank or European Bank for Reconstruction and Development support as part of a broader international package, but those options do not involve a quick fix. The focus now needs to be on ensuring that the IMF is at the front and the centre of any package of assistance to Ukraine. I will be discussing that with it in Washington later this week, as I am sure other EU countries will do as well.

Commission Work Programme 2014

William Cash Excerpts

Wednesday 22nd January 2014 Commons Chamber

[The Minister for Europe (Mr David Lidington)]

I beg to move,

That this House takes note of European Union Document No. 15521/13 and Addendum, a Commission Communication: Commission Work Programme 2014; agrees that this document is a useful tool for planning the Government’s and Parliament’s engagement with the EU in 2014; and supports the Government’s view that measures which promote growth and jobs in the EU, including measures towards completing the Single Market, are the top priority.

This year’s work programme is the last for the current European Commission. It covers what the Commission is giving priority to in the final months of its mandate as well as some new initiatives and, of course, it does not cover everything that the European Union and its institutions are doing.

In last year’s debate on the annual work programme, right hon. and hon. Members focused in particular on the process of our scrutiny of European legislation. Prior to this year’s debate, the House’s European Scrutiny Committee published a report on reforming scrutiny in this place. I want to give the House an assurance that the Government are considering that report with the seriousness that it would expect and we will publish our response as soon as we can.

[Mr William Cash (Stone) (Con)]

As the Minister has referred to the report and to the formal response that the Government must give to it under the conventions of the House, I think it might be appropriate to mention the reactions of some members of the Government—I will not say everybody—to the proposals. They were described as “unrealistic” by one Minister and “unworkable” by another. That is not entirely consistent with the formalities of the convention that applies, but I think we will find that we will get a good response, as the Government have also said that it is a very important study.

[Mr Lidington]

This is an important study, which makes a large number of recommendations. The recommendations in my hon. Friend’s report have a bearing on business, which is the responsibility of pretty much every Government Department. The discussions that we are having at both official and ministerial level reflect the breadth of the areas of policy covered by my hon. Friend’s Committee.

The Committee noted, in its report recommending today’s debate, that—

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[Mr Gareth Thomas (Harrow West) (Lab/Co-op)]

I welcome the opportunity to discuss the European Commission’s work programme for 2014. I thank the European Scrutiny Committee for its useful report. The Committee suggested that a debate before Christmas would be timely, and given the thinness of the Government’s agenda for this House, it is surprising that this debate has not taken place earlier.

The work programme published on 22 October is shorter than usual, not least because European Parliament elections are coming up in May and because the new college of commissioners will take office later this year. Our ability to influence the work programme’s direction to achieve UK objectives and protect our national interest depends in no small part on having good relationships with our allies in Europe. Yet, instead of defending our interests in Europe, the Prime Minister all too often puts party before country, opting for policy positions and language that appease Eurosceptic Back Benchers and alienate allies in Europe.

The result is that the Prime Minister finds himself in an increasingly isolated position in Europe. Indeed, the Prime Minister has been attracting an increasing number of openly hostile comments from crucial European allies. Germany, Poland, France and Bulgaria are our allies in Europe, and yet senior figures in their Governments—most recently the German Foreign Minister, Mr Steinmeier—have given briefings on their profound disagreement with our Prime Minister’s views. The political weight of the people in those countries who have made their disagreement with the Prime Minister known and the tone in which they have done so are concerning. Once again, the Conservative party is pushing Britain into the isolated corner that John Major’s Government left us in.

The Prime Minister has promised to renegotiate the terms of Britain’s membership of the European Union. He said that treaty change will deliver important opportunities to repatriate a series of powers that are apparently held by the EU and which he thinks ought to be back with the United Kingdom. Having looked at the work programme, I confess that I cannot see a major treaty change in preparation. It is far from clear that the treaty change on which the Conservative party is banking is likely to happen soon. If the Minister were to be honest with the House about that, I suspect that he would say that he is starting to realise that the game is up. The Chancellor’s recent plaintive call for treaty change in the context of banking union gave the impression that he knows that the possibility of such treaty change is retreating. Even if we assume that treaty change will happen, we still have absolutely no idea which powers the Conservative party wants to repatriate. The Minister has once again failed to tell us today.

The work programme priorities for 2014—economic and monetary union; smart, sustainable and inclusive growth; justice and security; and external action—are critical to the UK. In particular, a strong and stable economy in Europe is crucial to British jobs, security and prosperity. As the UK continues to battle through the Government’s cost of living crisis, with falling wages, rising prices and stagnating growth, our continued membership of and active engagement in the European Union are crucial to Britain’s economic prosperity. Almost half the UK’s trade and foreign investments come from the European Union. More than 3.5 million jobs in the UK depend on our membership of the EU.

[Mr Cash]

The hon. Gentleman knows perfectly well that the figure of 3 million jobs is a monumental myth. It came out 10 years ago and was denied by the National Institute of Economic and Social Research, which described it as Goebbels propaganda.

[Mr Thomas]

The information that I gave was confirmed as recently as 2011 in a written parliamentary answer from the Foreign Secretary. Who am I not to believe the Foreign Secretary on a matter of such importance? If the Foreign Secretary’s view is not good enough for the Chairman of the European Scrutiny Committee, perhaps I could point him towards recent research by the CBI, which estimates that our membership of the EU is worth between £62 billion and £78 billion, which equates to about 4% to 5% of the country’s total economic output or about £3,000 per UK household per year.

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[Mr Brian Binley (Northampton South) (Con)]

It is important that the House considers the European Commission’s work programme, as we have done before.

The Greek presidency has the potential to make a major difference to the EU at this critical time, and we should have every hope that it will attempt to make those changes, bearing in mind the recent history of the Greek Government. Greece is arguably one of the greatest victims of the bungled “integration at any price” agenda of those behind the European project and should be well placed to showcase the dangers of recent approaches. This was an opportunity for European integration to change course, but the message from the programme of the Greek presidency is that that process of political integration and state building continues apace regardless. This document and agenda do little to address the very real concerns of ordinary voters across the EU and convey that detached superiority of a complacent unaccountable elite. At a time when Europe teeters on the brink, this work programme presents an agenda for ever-more integration, justified in language that would cause even the most cynical to take note.

We are promised that the Greek presidency will

“reverse the current trend of youth unemployment”

as part of the effort on economic growth and job creation, but it seems that the main output is to

“enhance the implementation of the Compact for Growth and Jobs”,

whose relevance is worthy, to say the least, of deep scrutiny. If we want to reverse the trend of youth unemployment as well as put right many of the wider ailments of the European economy, we need to revisit the entire economic model on which the European project is based. Instead of a burdensome, overbearing single market driven by a social model that is neither desirable nor affordable, we need a much lighter, more flexible and trade-focused agenda for wealth creation and prosperity.

That is not, however, the priority of the Commission. Instead, we are promised a further push on the integration of the EU and the eurozone. The work programme undertakes to push hard on banking union, and promises to

“create a well coordinated Economic and Monetary Union with a view to ending the instability and uncertainty observed in particular in the ‘periphery’.”

Are they talking about the fastest-growing economy in the world when they talk about the periphery? One wonders whether that is how they see Britain.

Perhaps of the greatest concern is that we are promised

“a particular focus on the social dimension”

of European monetary union,

“which, for the first time, will be integrated into the European Semester cycle”.

[Mr Cash]

My hon. Friend refers to banking union. For the last two and a half days, I have attended a conference in Brussels, in which it was explicitly said, over and over again, that it was crucial to get the banking union proposals through. They pleaded with national Governments to get those proposals through before the European elections, because they fear that if they do not get them through before then, they will never get them through.

[Mr Binley]

My hon. Friend is, of course, right. We know that banking union was proposed as a last-ditch effort to give some confidence to the market, but I doubt whether these are the key economic promises for businesses across the EU—that is the truth of the matter. They are a long way from where voters would like the political emphasis to be placed—especially, if I may say so, in this country.

It is difficult to reconcile these priorities with the economic realities, particularly within the eurozone. As we emerge tentatively from recession, alongside the United States, the eurozone continues to face a crisis of existential proportions. The promising picture in Ireland and Spain, as well as improved confidence, is more than offset by the risk of a widespread deflationary spiral and the worrying travails of the French economy, which, being socialist-driven, frightens most of the people in most of the countries across Europe.

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[Mr Bain]

I am grateful for that intervention, but I remember that major employers such as Hitachi established themselves in the north of England precisely because we are in the EU and have access to the single market as a result. Many investors have said that if we were no longer part of the single market, many jobs in this country would be put at risk. I simply ask my hon. Friend to reflect on that point.

[Mr Cash]

If the hon. Gentleman were to read not only The Guardian but also The Daily Telegraph today, he would see references to what the chairman of Unilever said. His comments were much more in line with the arguments made from the Government Benches because he was saying that reform was needed and that far more concern was being expressed about that reform than was necessary.

[Mr Bain]

I am conscious that other Members wish to speak and I do not want to do a survey of all of today’s British newspapers, but I simply say to the hon. Gentleman that the main story on the front page of the Financial Times this morning was headlined “City warns UK over loss of EU influence”, so I think we are hearing precisely the voices of business, who want to promote job creation and who are expressing the view that isolating ourselves in the way that the Government are trying to do, in a vain attempt to placate the hon. Gentleman, is simply not going to work in our long-term interests.

There are several points I want to develop in the remainder of my remarks. First, on economic and monetary union, yesterday the International Monetary Fund’s world economic outlook predicted growth in the eurozone for this year at a mere 1% and for next year at an only slightly higher 1.4%. At the same time, there are 26.5 million people out of work across the EU28, and 5.6 million of them are under the age of 25. That is a youth unemployment rate of nearly 24%. That should shame all of us. It should represent a call to action for every politician who has influence to shape the EU’s priorities to focus on job creation for the next few years.

Over the year to last November our trade deficit with the EU rose to £3.2 billion and the continued low growth in the eurozone area was one of the main contributory factors to dampened demand for our manufacturing exports. By contrast, our trade in services, including financial services, is in surplus. So it is in the interests of business and workers here in the UK to see the fault-lines in economic and monetary union repaired by putting in place a strong set of common institutions such as a single resolution mechanism and processes to allow for the resolution of distressed banks in the eurozone area. The question of whether there should be a common deposit insurance guarantee, or commonly issued debt, is certainly a more divisive issue among the eurozone members, but now that a new coalition is in place in Berlin, we should at least begin to have greater certainty about Germany’s intentions on both those fronts.

We should also welcome the fact that, contrary to many expectations—not least from Members on the Opposition Benches—the eurozone has not broken up. Indeed, Latvia became its 18th member this month. Nevertheless, in this work programme the Commission has acted on the widespread sense among peoples in Spain, Portugal, Greece, Cyprus and Ireland that monetary union lacked a sufficiently social or democratic dimension, with little regard being given to the effects on inequality, wages and, most devastatingly of all, youth unemployment in some of the programmes imposed upon those member states in the name of deficit reduction. It is interesting to note that the Commission’s work programme refers to the further priority for work in this area in the coming 12 months.

As Commissioner Andor’s report today makes clear—this certainly was covered in The Daily Telegraph, to which the hon. Member for Stone (Mr Cash) referred earlier—eurozone members should not be left with the only options being internal devaluations or wage cuts as the means of escape from any future downturns. The price for that would simply be paid by ordinary working people with substantially lower living standards. A eurozone with a strong fiscal union component will help to avoid that possibility in the future.

When Government Members visited Brussels in October last year we heard from the office of President Van Rompuy that eurozone member states now recognise that sharing a currency and a common interest rate was not enough to avoid the effects produced by the economic shock of the great recession. So plans are now being developed to establish limited pooled resources that could help share out or equalise economic demand when some states suffer a severe dent in their output. We should welcome that. It has also been proposed that a revision of some of the terms of the fiscal pact could allow eurozone states greater flexibility to boost demand through fiscal policy in times of economic trouble. We should also welcome those proposals.

In common with weak lending to small and medium enterprises in this country, the Commission should also focus in much greater depth on how the European Investment Bank increases lending to businesses in the coming months, so that Europe’s growth rate can be expanded. In that sense, there are real parallels between the debate on the flaws of monetary union in the eurozone and the debate that will take place in my constituency and the 58 other constituencies in Scotland on the future of the economic, political and fiscal union that is the United Kingdom, which will have its resolution this September. There is a strong recognition that a properly functioning currency union requires both fiscal and political union too.

Secondly, on markets for trade and future growth, the work programme refers to the potential for a second Single European Act to complete the free movement of goods and services in areas such as energy and telecommunications. This is vital so that the EU can establish a proper digital single market.

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[Mr William Cash (Stone) (Con)]

Having listened to what the hon. Member for Glasgow North East (Mr Bain) has just said, I think he really needs to take into account the fact that we have a Queen’s Speech every year at about the time the work programme comes out. That Queen’s Speech is put forward on behalf of an elected Government; it contains Government proposals that come from a democratic process. We are discussing a work programme that comes from an unelected bureaucratic organisation that lays out its priorities and expects people to respond to them. There is a serious difference in character between the two. Many of the proposals in the work programme—some of which are not legislative proposals but initiatives—are brought into effect by regulation or directive.

The proposals in the Queen’s Speech, being democratically driven and debated in the House, are brought into effect by Bills of Parliament. Those Bills have Second Readings, they are amended and they have a Report stage. They go through both Houses of Parliament. However, a single paragraph in a regulation or directive could have the most profound effect on us in this country. The provision would almost certainly be driven through by a qualified majority vote. That could involve our being pushed into a consensus or being outvoted; it could also involve a co-decision with the European Parliament. We have less and less control over what goes on.

The Commission programme is, as a matter of principle, based on undemocratic systems. That is why the European Scrutiny Committee report, which has received quite a lot of attention recently, has put forward proposals relating to those provisions that could, in the national interest, be considered for disapplication or—in the case of the proposals that we do not want—subjected to a veto.

In regard to the Minister’s opening remarks, I should point out that the Government are resolutely against several provisions in the work programme, including those relating to the European public prosecutor’s office, and to the single resolution mechanism, in which we will not participate. That Government also oppose the provisions on free movement rights, to which they will not subscribe, and to those relating to the European anti-fraud office. All those matters will still be produced by the work programme, however, and we will be unable to prevent them from happening. The hon. Member for Glasgow North East is perfectly entitled to say that he would like to have the single resolution mechanism—in fact, I recall him saying that he thought we should have it. However, I can assure him that that is not the view in the City of London, and it is not the view of many people who have a great deal of knowledge of these matters.

A serious constitutional question lies in the difference between the Commission work programme and legislation that originates in this House, based on manifestos. The work programme is completely different in character and consequence for the voters we represent, in a way that is profoundly undemocratic. That is point No. 1. As Chairman of the European Scrutiny Committee, I know that our job is to look at all these matters—and point No. 2 is that we do. We do that diligently throughout the year. Let us leave aside the disapplication and veto matters to which I have just referred. When I was in Brussels yesterday, I was told by very senior members of other national assemblies, “We would give our intense support to anything that would enable us in our own countries to have flexibility to prevent the imposition of legislation on banking union and so on.” Their list is endless, but they just cannot do it because of the way their constitutions are tied in. Our report recommends that the departmental Select Committees could be brought in to make assessments—

[Mr Lidington]

indicated assent.

[Mr Cash]

I am glad to see the Minister nodding, because we believe our constructive suggestion will help to make more sense of the proposals in this work programme. Not only would each Select Committee have a rapporteur who is a specialist in European matters, if that were agreed by the House, the Procedure Committee, the Liaison Committee and so on, but the generality of departmental Select Committees would consider whether they wanted to prioritise proposals that came out of the work programme and make their own political judgment on whether they thought it was in the interests of the United Kingdom to go along with those proposals. They might even absorb some of the ideas and say they were good. The bottom line is that there should be a proper democratic discussion about it all, as that would be very helpful.

The Minister has referred to a number of initiatives, but I wish to say one thing about the repeal of legislation. This relates to actions under the regulatory fitness and performance—REFIT—programme where we must be realistic. There is far too much of a burden on British business and, indeed, on businesses in the European Union as a whole. I hear that view from all my colleagues in the other national Parliaments when I visit them. I shall be going back to see them in Athens this weekend, having just come back from Brussels. They all say the same thing: they want small businesses to be much more effective; they want more opportunities for entrepreneurship; they want to have more free trade; and they want there to be the opportunity to make money, so that the taxation can be provided for public expenditure. If not, they find that they have terrible problems with their economises.

Finally, we must all be very pleased about today’s employment figures. It is a great tribute to the Government that we have seen this dramatic increase in employment. I just add, however, that a great deal of it comes from our expansion of non-EU trade. We see that in the premium selling points of Jaguar Land Rover and the companies where the money is really being made internationally. We have a deficit on current account transactions, trade and services, and imports and exports—the golden criteria. On that principle, we run a deficit with the other 27 member states of £49 billion a year. We had a surplus in the figures for the last accounts of £12 billion, but the figures for the two quarters for the beginning of the next projected flow are £5.6 billion and £6.1 billion. If that continues, as I think it will, by the end of this year we could find that, in one year, business, with the assistance of the Government—I give them credit for this, because they have been listening—will have doubled our non-EU surplus with the rest of the world. That is where the machinery for more employment and the drive for prosperity for this country will come from, which is why I am so pleased to have the opportunity to congratulate the Government on the figures. At the same time, I issue one small word of caution: we should not put all our eggs in the European basket.

European Council

William Cash Excerpts

Tuesday 7th January 2014 Commons Chamber

[Mr Lidington]

First, I am grateful for the hon. Lady’s words of welcome. Let me respond to her first question by reminding her that since May 2010 my right hon. Friend the Prime Minister has made no fewer than 18 oral statements here following Councils that took place while Parliament was sitting—that is double the number of such oral statements given by his immediate predecessor. It has been the practice of successive Governments not to make an oral statement following Councils taking place during a recess, and my right hon. Friend therefore made a full written ministerial statement on Monday, which set out in detail the key outcomes from this Council.

On the hon. Lady’s important points about common security and defence policy, the key is to understand the distinction between ownership by the EU of defence capabilities, which we do not support and have resisted successfully, and co-operation by European countries in providing greater defence and security capabilities. What was good about the conclusions both of the December European Council and of the previous week’s Foreign Affairs Council on CSDP matters was that they made it very clear that the EU first had to work with, and not duplicate, the efforts of NATO and work alongside other partners in different parts of the world. Secondly, they made it clear that the EU would look for ways in which to encourage co-operation on capabilities, for example, on drones, which she mentioned. That is not some new EU-directed operation, but a facility that individual members of the EU can decide whether or not to take part in. There is no secret plan to direct some Euro drone out of the Berlaymont; it is very different. It is about co-operation between willing member states.

On the defence industry point, the conclusions made it clear that the European defence sector needed to become more competitive and efficient. The language that we successfully negotiated makes it clear that rather than there being any question of European national champions, the defence sector must comply with European law, which means that there must not be illegal state subsidies, except where subsidies are explicitly protected under the treaties. The language also makes it very clear that we, or indeed any other country, are not in any way constrained from continuing to work with the United States or other international partners on our defence industries. When the hon. Lady comes to look in more detail at the conclusions, I hope that she will agree that it was a good outcome for the United Kingdom and a successful negotiation.

[Mr William Cash (Stone) (Con)]

This morning, the European Scrutiny Committee cross-examined the Minister for Europe on these issues. I have written to the Prime Minister accordingly in relation to the fact that he is not here today, as he should be and as our Committee recommended in our recent European scrutiny report. The substantive matter is that, on the one hand, the Prime Minister did say in his press statement that defence must be driven by the nations and not by Brussels diktat, but, on the other, Mr Van Rompuy states that we must have credible European scrutiny and

“a strong, credible, common security and defence policy”.

He also suggests that there is a greater role for European defence. Does my right hon. Friend agree that it is impossible to compare and to reconcile those different approaches given that there is an ever-increasing competence towards European defence irrespective of what the Minister has just said?

[Mr Lidington]

On my hon. Friend’s first point, I am aware that he has written to the Prime Minister about the matter of oral statements. There is of course that recommendation in his Committee’s report. I am sure that my right hon. Friend will reply to the letter. For the record, I repeat the Government’s commitment to give their full detailed response to the European Scrutiny Committee’s report in due course, and I pledge to do that as soon as we are able.

On his point about CSDP matters, I do not agree with him. I, too, want to see a European arm of the Atlantic alliance that is more credible and effective than it is at the moment. That is certainly a message that I hear consistently from the other side of the Atlantic as well. But there is a difference between that and the European Union and its institutions owning and directing those policies. What we support and advocate is a system in which European countries take more seriously their obligations to deliver effective security and defence contributions to that trans-Atlantic alliance, and that is where the conclusions of the European Council represented a clear victory for our vision. It advocated an emphasis on capabilities and political commitment, not on new EU institutions and not on the EU ownership. Rather, it insisted on the EU complementing NATO and working with the grain of member state responsibility and competence over defence policy.

European Union (Referendum) Bill

William Cash Excerpts

Friday 29th November 2013 Commons Chamber

[Mr Douglas Alexander (Paisley and Renfrewshire South) (Lab)]

I thank the former shadow Europe Minister, my hon. Friend the Member for Wolverhampton North East (Emma Reynolds), and the current shadow Europe Minister, my hon. Friend the Member for Harrow West (Mr Thomas), for providing the Bill with what we judge to be an appropriate and necessary level of scrutiny both in Committee stage and on Report. I thank the other Committee members and the contributors to those debates. Indeed, the Bill’s promoter, the hon. Member for Stockton South (James Wharton), who spoke today—that was a particular pleasure—has at least been present when the Bill has been debated and discussed over recent weeks.

Let me briefly address the points raised in Committee and on Report. Alas, the Bill comes to Third Reading with all the fundamental issues and concerns that were raised still unresolved, with the exception of the issue of Gibraltar, where, I am glad to say, we were able to make some progress from the Labour side.

In truth this is a Bill not about the Conservatives trusting the public but about Conservative Back Benchers not trusting a Conservative Prime Minister.

[Mr William Cash (Stone) (Con)]

rose—

[Mr Alexander]

I will make a little progress, and then I will be happy to take some interventions. Let us be clear about what has happened over the course of recent weeks. The Bill started with a breakfast at Downing street for Conservative Back Benchers. Last week the Prime Minister again offered Conservative Back Benchers breakfast at Downing street. It is not clear whether it was a continental breakfast, but it was certainly breakfast at Downing street. The Prime Minister seems to be seeking unity through a strategy of obesity. He is clearly worried that if he is not doing the cooking, then all too shortly he will be on the menu. Any judgment about an in/out referendum on the United Kingdom’s membership of the European Union has to be based on what is in the UK’s national interest. We do not believe that the Bill’s proposal for an in/out referendum in 2017 is in the national interest, which is why we are not supporting it.

The Bill anticipates an arbitrary timetable for an in/out referendum in 2017 in the United Kingdom divorced from any serious assessment of the likely timetable for treaty change across Europe. When the Prime Minister first announced his new policy back in January, he argued that treaty change was inevitable, necessary and indeed desirable. He said in April:

“I am sure there will be treaty change.”

He went on to say:

“I’m absolutely convinced that there will be the need to reopen at some stage these treaties”.

Yet the prospect of treaty change seems less likely today than it was when the Prime Minister made those remarks about which the Foreign Secretary spoke only a moment ago. Indeed it is significant that the German Government now seem less inclined to push for immediate treaty change, instead favouring intergovernmental agreements under article 114 of the EU treaty. Indeed in May this year, the German Finance Minister Wolfgang Schaeuble, said explicitly:

“Banking union is a central project, we need institutional changes but we cannot wait for a treaty change.”

Only this week, the grand coalition document, which will form the basis of the German Adminstration’s governing agenda, was agreed, and it made not a single reference to the prospect of treaty change. The truth is that the date of 2017 had more to do with Tory party management than EU-wide treaty change.

[Mr Cash]

Given the fact that the former Prime Minister Tony Blair promised a referendum on the constitution, will the right hon. Gentleman tell us, in the context of this incredibly important Bill, whether or not the Labour party has ruled out having a referendum on the European Union?

European Union (Referendum) Bill

William Cash Excerpts

Friday 22nd November 2013 Commons Chamber

[Mike Gapes]

It might be, but we do not necessarily need to have a referendum. We could say that those who wish to vote to leave the European Union on 7 May 2015 should vote for the UK Independence party, that those who wish to stay in the European Union and work for its improvement should vote Labour and that those who are unclear what they are doing one way or the other should vote for the Conservatives. That would be much better and would mean that, in effect, the general election was the referendum.

[Mr William Cash (Stone) (Con)]

I am listening carefully to what the hon. Gentleman is saying. On the status quo, given the urgent question that I had to raise about the charter of fundamental rights, for example, as well as many other things, does he agree that we need fundamental change in the relationship and not necessarily nibbling at the treaties? In fact, we do not want nibbling at the treaties at all.

[Mike Gapes]

I disagree with the hon. Gentleman, just as other Members, including his predecessor as Chair of the European Scrutiny Committee, disagreed with his argument the other day. However, I do not think I would be in order if I went down that route, because that is not the subject before us.

Let me come to the detail of my amendments. As my hon. Friend the Member for Cardiff West (Kevin Brennan) said in his intervention, amendment 21 proposes that the referendum be on the same day as the next general election. One argument for that is that it would save a great deal of money, because the polling stations would already be there, and the publicity and the campaign could be part of the general campaign. There is also a second argument. Moving the referendum to that date would clarify the debate and resolve the issue at the beginning of the next Government, rather than allowing their first 18 months in office to be dominated by this so-called renegotiation, which would divert attention from their priorities for health, education and housing.

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[Phil Wilson]

Again, my hon. Friend is absolutely right. That proves the importance of our role in Europe now and in the future.

[Mr Cash]

Despite everything the hon. Gentleman is saying, does he agree that it is essential that we have a referendum before the end of 2014, because we are already in a process of constitutional and fundamental change? Renegotiating the treaties will do no more than nibble at things, so it is absolutely essential that we have a referendum in the interests of the British people.

[Phil Wilson]

I thought that the hon. Gentleman would make an intervention during my speech, so I looked at the number of jobs in Stone that are reliant on Europe. The number is nearly 6,000, so he should think carefully about supporting the Bill.

The hon. Member for Stockton South should also have consulted Steve Elliott, the chief executive of the Chemical Industries Association. That industry is very important in Teesside, and Mr Elliott said:

“With 50% of our exports destined for continental Europe, the UK’s largest manufacturing exporter—the chemical industry—has every reason for the country to remain as part of the European Union. It is earlier and smarter engagement at all levels—member state, the Commission and the Parliament—that will address our sector’s chief concerns around energy and regulation and strengthen Britain’s chances when competing globally for sustained economic growth and jobs.”

I shall finish by saying this—[Hon. Members: “Hooray!”] Conservative Members obviously do not want to hear the facts of how the Bill would impact on the north-east of England and the UK economy. I honestly do not know how the hon. Gentleman will be able to explain to his constituents the need to extend the age of uncertainty that he intends to thrust on them through the Bill, but I believe that they will pay him back at the ballot box in 2015 by returning a Labour MP for Stockton South.

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[Chris Williamson]

I am grateful to my hon. Friend. I was in no way seeking to be critical of him. His amendment was a big improvement on what was available in the Bill. There is a very real concern across the country and in the business community, which has been articulated by senior business leaders, that the referendum and the date on which it is held could jeopardise a huge benefit to the country, because the single market is worth between £62 billion and £78 billion to this nation. That is £3,000 per household, so if we are to have a referendum, getting the date right is crucial. We do not want to put in further jeopardy that huge benefit to the British economy and all those millions of British workers who rely on the European Union for their livelihood.

[Mr Cash]

When the hon. Gentleman refers to extremists, is he aware that France, Ireland, Holland and Denmark have all had referendums? There is nothing extreme about that. Furthermore, to hold a referendum before the end of 2014 has enormous attractions and I will vote for it. I raised the issue in my debate against Nigel Farage in the party conference this year, and I also made a speech and put out a press release the previous year, calling for the same position.

[Chris Williamson]

I am grateful to the hon. Gentleman, but I was not referring to extremists in France and Denmark. I was referring to extremists on the Conservative Benches who have taken the Prime Minister hostage.

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[Mr Thomas]

I thank the hon. Gentleman for his intervention, and it is one of the reasons why I have always supported the campaign to get him on to his party’s Front Bench. I hope that the Minister for Europe has listened to the call for clarity from his Back Benches, and even at this point will intervene on me to tell the House what powers and competences he wants to get back.

[Mr Cash]

Will the hon. Gentleman give way?

[Mr Thomas]

I apologise to the hon. Gentleman, but I want to make a bit more progress on something in which I think he will be very interested.

The hon. Member for Windsor tabled his amendment before the European Scrutiny Committee had completed its task of reviewing the significance of the justice and home affairs opt-out decision, and all those responsibilities that the Government want to opt back in to. At paragraph 552 on page 148 of its report, it said that the Home Secretary had made it clear that the block opt-out was

“first and foremost about bringing powers back home.”

That is a view apparently shared by the Justice Secretary, who is also quoted in the report as saying that he regarded it as

“part of a process of bringing powers back to this country.”

But, sadly, the European Scrutiny Committee reached a very different conclusion. After examining a series of witnesses, it said:

“We see little evidence of a genuine and significant repatriation of powers.”

Given that the balance of competences review has dragged on and on, and will no doubt drag on some more, if the Minister for Europe cannot tell the House soon what powers and competences the Prime Minister wants to repatriate, the scepticism in his own party’s ranks, never mind throughout the country, will just grow and grow.

[Mr Cash]

What we really want is to bring the government of the United Kingdom back to the United Kingdom, which will require fundamental constitutional change, so nibbling at the treaties will make no difference to that.