British Property Owners (Cyprus)

William Cash Excerpts

Tuesday 27th October 2015 Westminster Hall

[Andrew Gwynne (Denton and Reddish) (Lab)]

I beg to move,

That this House has considered the matter of British property owners in Cyprus.

It is a pleasure to see you in the Chair, Mr Gray.

I am grateful for the chance to raise this issue in Westminster Hall. I am not the first Member to take it up on behalf of their constituents and I begin by praising the work of the all-party group on the defence of the interests of British property owners in Cyprus. Under the chairmanship of the hon. Member for Stone (Sir William Cash), the group has done great work in raising the concerns of people caught up in property and banking problems in Cyprus. It has also provided a framework through which they can pursue justice and fairness in relation to their properties.

I have been contacted by a number of people in my constituency about the mis-selling of Swiss franc mortgages by Alpha Bank in Cyprus, and about the poor advice they had received from solicitors purporting to act on their behalf. Briefly, the background to this issue is that between 2003 and 2010 Cypriot banks advised buyers to take out a mortgage in Swiss francs, because the interest rates were lower and the currency was considered stable. However, when the value of the Swiss franc soared against the euro in the aftermath of the financial crisis, buyers found that their mortgage repayments had doubled.

Buyers have complained that banks often failed to explain the potential risks or that currency fluctuations could cause repayments to rise, which has resulted in property owners being left with unfinished and unsaleable apartments, huge loan obligations and negative equity following the collapse of the Cypriot property market, which saw property values in some areas plummet by as much as 70%.

In one case brought to me by a constituent, the developer went into liquidation before the property being built for my constituent and his wife had been completed, taking 85% of their mortgage fund and leaving them insufficient money to finish the remaining work. My constituent says that his solicitor and Alpha Bank allowed that to happen by permitting the developer himself to sign written confirmation that the various stages of work had been completed.

My constituent and his wife had to begin making mortgage repayments at a time when they did not have the land in their name and the property was not finished. Effectively, therefore, they were paying a mortgage on a property and land that was not legally theirs. When they explained to Alpha Bank that they were in a desperate situation, they were simply told that if they did not make their mortgage payments the bank would seek possession of their home here in the United Kingdom. Similarly, another constituent with the same Swiss franc mortgage with Alpha Bank spoke of what he believed to be collusion between the bank, the solicitor and the developer, leaving him threatened with bankruptcy.

I am sure that those examples will be depressingly familiar to anyone who has had dealings with people caught up in the fiasco.

[Sir William Cash (Stone) (Con)]

I am chairman of the all-party group on the defence of the interests of British property owners in Cyprus. The hon. Gentleman is a member of the group. Is he aware that we will have a meeting of those affected at 11 am on 12 November, at which the high commissioner for Cyprus, Mr Euripides Evriviades, will be present? There is also a Bill before the Cyprus Parliament, but I am sure that the hon. Gentleman will deal with that shortly, so I will not go into any more detail.

[Andrew Gwynne]

I am grateful for the hon. Gentleman’s intervention. He is absolutely right, and I commend him for his work in leading the all-party group. It is my intention to be at that meeting but, if parliamentary duties do not permit me, a representative from my office will attend. I am aware of the situation in Cyprus to which the hon. Gentleman refers.

There have also been allegations of Cypriot solicitors using invalid powers of attorney. The case I want to focus on, on behalf of one of my constituents, is an example of that, and it also highlights that constituent’s concern about his legal representation while seeking to obtain redress.

[Andrew Gwynne]

My right hon. Friend is absolutely right to ask that question, and I expect and hope that the Minister in his concluding remarks will be able to answer it. It is important that whatever pressure can be brought on the Cypriot authorities by Her Majesty’s Government in the United Kingdom, is brought, and that Ministers do all they can to raise the issue with their Cypriot counterparts.

[Sir William Cash]

May I quickly add that the Minister for Europe has been immensely helpful? He has been to two, or perhaps even three, of the meetings I have convened for the purpose. I pay tribute to him for his active interest in the matter.

[Andrew Gwynne]

The hon. Gentleman is absolutely right to highlight the work that the Minister has done, and will continue to do, in respect of the injustices that many of our constituents face. I look forward to the Minister’s reply.

My constituent does not want to be publicly named, so I will refer to him as Mr T. C. In 2007, Mr T. C. and his brother-in-law wanted to purchase a retirement property in Cyprus through a UK company called ROPUK. They met with the company’s representatives, who showed them impressive brochures and projections, and they decided to go ahead with the purchase. They paid a £25,000 deposit and understood that when the property was built they would go to Cyprus to have an inspection and then sign a mortgage agreement. They were advised by ROPUK’s representative that a Swiss franc mortgage would be best, but they did not sign up to any agreement except to give a Cypriot solicitor power of attorney in any transactions to which they agreed.

In 2010, when the property was due for completion, Mr T. C. visited Cyprus to monitor the progress of the build. He found that it was not even half finished; it is still in the same state today. He believes that the power of attorney was not executed in accordance with common or Cypriot law, rendering it illegal and anything signed using the power of attorney invalid.

My constituent and his brother-in-law first heard of Alpha Bank when it started to pursue them for payments. They had not signed a mortgage agreement themselves, but one was signed by a third party without their knowledge or consent, and they have never even seen the agreement with the bank, despite repeated requests. They believe that the bank released all the money from their fraudulently obtained mortgage to fund something that is simply not there.

The payments from the mythical mortgage should have been gradually disbursed as the build progressed, according to the progress certificates issued by the project’s architect. The bank’s surveyor should have been inspecting the development and issuing a report back to the bank, a copy of which should have been passed to the Cypriot solicitor, who was supposed to be acting in my constituent’s best interests, to verify build stage against the drawdown of moneys.

[Sir William Cash]

If the Bill to which I referred becomes law, it will give the Republic of Cyprus land registry the authority to exempt, eliminate, transfer and cancel mortgages and encumbrances depending on the case and under certain conditions. I do not have time to go into all the details, but I want to get that into Hansard.

[Andrew Gwynne]

I am grateful for that intervention. It is important that that is placed on the record.

I return to the case. None of what I just mentioned was ever done, which is why, years after the supposed completion, Mr T. C. and his brother-in-law still have absolutely nothing. They now owe the bank in the region of £257,000 plus interest—the original price they were quoted was about £140,000 minus their deposit—and they were issued a writ informing them that their case would be heard in the courts of justice in London in June 2014. They received the writ less than a week before the case was due to be heard and had no time to appoint a solicitor.

The case was heard at the courts of justice in front of Master Easton. He asked Alpha Bank’s solicitors, Stephenson Harwood, to shelve the European enforcement order pending ongoing legal discussions in Cyprus, but they refused. A European enforcement order was rubber-stamped subject to a second hearing in September. By that time, Mr T. C. and his brother-in-law had appointed Cubism Law to represent them and their case was led by Duncan McNair, who they understood to be an expert in the field.

His representation in the UK forms the second part of the concerns that Mr T. C. raised with me. He and his brother-in-law paid Cubism Law £2,000 up front to represent them. A barrister attended court, but they say that they were simply told that the European enforcement order had been ratified and that a charge had been placed on their UK properties. They then had to defend the European enforcement order in Cyprus, where they believed they would get less justice than they would here.

Prior to the first hearing and before becoming subject to the European enforcement order, Mr T. C. transferred the house he and his wife owned into her name, to protect her share of their UK property, which was their only substantial asset. His wife was not party to the property purchase in Cyprus. Following the second hearing, Mr McNair commented that the judge had not been impressed by the action Mr T. C. had taken. My constituent says that he asked for advice on whether he should change the title deeds back into his name and that all he was told by his solicitor was that he should let them work for their money, by which he understood him to mean Alpha Bank’s British solicitors, Stephenson Harwood. Mr T. C. says that they always made it clear to their solicitor that their priority was to get the European enforcement order overturned and for no further action to be taken until that was achieved.

Mr T. C. says that over the next few weeks much correspondence was exchanged between the two firms, but that that did not prevent Stephenson Harwood from continuing to threaten seizure of the properties. However, it did result in Cubism Law making regular demands for funds, which my constituents deemed unnecessary. At that stage, they became concerned about the costs that were racking up, and the date for the Cyprus hearing was still weeks away. Through Cubism Law, they had paid for solicitors in Cyprus to represent them at the hearing, which was subsequently postponed three times.

Mr T.C. asked his solicitor what the strategy was for their situation, as the costs were spiralling and all they had asked at that stage was for him to defend the European enforcement order in Cyprus. Mr T.C. says that they also informed Cubism Law on 28 October 2014 that they did not wish to incur any further costs, but that specific request was ignored and the costs continued to mount. Most of the costs related to correspondence between Stephenson Harwood and Cubism Law over the transfer of the title deeds. Mr T.C. states that if his solicitor had advised him immediately to transfer the title deeds back to his name, he would have done so. He was eventually advised to do that and for him the question remains as to why he was not asked to do that earlier.

During the time leading up to the hearing dates, Mr T.C. says that he and his brother-in-law were constantly subjected to requests from their solicitor—usually late at night by email—giving them deadlines for payments with what they perceived to be veiled threats of them “prejudicing their case”, or inferring that they would not be represented in this country or in Cyprus in the future. By that stage, their costs had increased to more than £12,000, which was approaching the 5% settlement offer Alpha Bank had alluded to for incomplete properties such as theirs. On 10 November 2014 they sent an email to their solicitor again instructing him not to incur any further costs and mentioning the 5% settlement offer. That request was again ignored and their solicitor entered into discussions with a barrister, for which they were charged.

Mr T.C. says that they have yet to be informed what the basis of those costs were and what the discussions were trying to achieve. He adds that at no point had they indicated that they wished to start proceedings against the bank, as Mr McNair had advised that they could not sue the bank if the European enforcement order was not overturned.

[Sir William Cash]

Listening to the hon. Gentleman, I wonder whether his constituents have taken the matter up with the Law Society and the Solicitors Regulation Authority.

[Andrew Gwynne]

Not only have my constituents done that, but I have done so as their MP. The response we got back was less than satisfactory. I am still taking that up with the various authorities, but my constituents feel that one form of redress is to place on public record the real injustice that they feel they have endured over the past few years.

Mr T.C. said that when he pointed out that the solicitor had stated it was not possible to sue the bank without the European enforcement order having been overturned, the solicitor changed his statement and said it would be possible, but with difficulty. The new date for the hearing in Cyprus was set for early January 2015, but that was postponed until late January, and the case was finally heard in February 2015.

--- Later in debate ---

[The Minister for Europe (Mr David Lidington)]

It is, as always, a pleasure to serve under your chairmanship, Mr Gray. Let me start by congratulating the hon. Member for Denton and Reddish (Andrew Gwynne) on securing this debate and paying tribute to the work of the all-party group under the chairmanship of my hon. Friend the Member for Stone (Sir William Cash).

From the large number of items of correspondence that I get from Members from all parts of the House on property disputes, I am certainly aware of the kind of problems that the hon. Member for Denton and Reddish described and of the traumatic impact that property disputes often have not only on the finances, but on the mental wellbeing of the people we represent. Officials in our consular directorate in London are in regular contact with our high commission in Nicosia. Together they brief me and the Foreign Secretary on the scale of the property problems in Cyprus and the impact they are having on individuals.

While today’s debate has focused on the difficulties in Cyprus and the case of the hon. Gentleman’s constituent in particular, it is a sad reality that property disputes are common in other parts of the world. I have to be frank with the House: the ability of our consular staff overseas to help in individual cases is very limited. That is partly because millions of British citizens live overseas and many thousands of others visit foreign countries every year. It is simply not possible for the Foreign Office to become involved in private legal disputes to which British citizens overseas are party, whether they are related to property, commercial interests or family disputes.

Another issue is that property laws are the competence of individual sovereign states. We have no more authority to intervene in matters concerning Cypriot domestic legislation than the Governments of Cyprus, Spain, Greece, Turkey or Bulgaria—or any other nation where there are numerous property disputes—do to intervene in United Kingdom domestic legislation. Our position on property disputes is consistent with the approach taken by the US, Canadian, Australian and New Zealand diplomatic services. We will, however, do two things. We will continue to try to provide as accurate and up-to-date information as we can to our citizens about the risks involved in buying property overseas and about what they might do to manage those risks, and we will continue to lobby hard the Cypriot and other Governments to try to persuade them to address some of the generic problems that these distressing individual cases highlight.

[Sir William Cash]

Again, I just want to put something on the record. The Bill to which I referred, which was passed on 3 September in the Parliament of the Republic of Cyprus, is not yet available in English. I know the high commissioner has requested it, but it is taking some time. We are now almost in November. I am told that until it is provided, the general information—for the sake of those who read transcripts—can be found on the website of Nigel Howarth of Cyprus Property News. However, the Bill does not apply to mortgages that were dealt with in Swiss francs.

[Mr Lidington]

What my hon. Friend says is right. I want to refer to that Bill later, but we continue to urge the Cypriot authorities to publish an English-language version of the new law as soon as possible and to make available any guidance that might need to be issued in association with the statute itself. I am sure that the forthcoming meeting of the all-party group with the high commissioner for Cyprus to the United Kingdom will provide a further opportunity for such persuasion to be offered.

We publish information on the high commission’s gov.uk website and, more generally, the FCO publishes a guide entitled “Support for British Nationals Abroad”, which also provides general advice for British citizens who are thinking about buying a property in another country. Last month our consular officials attended “A Place in the Sun”, an exhibition in Birmingham, to talk directly to people considering going to live abroad. The purpose of these initiatives is to help to ensure that our citizens are better informed of the risks and challenges before they take the plunge. For example, we always urge people to take proper professional advice, including legal advice, before buying property.

In some cases, such as the one that the hon. Member for Denton and Reddish has described, part of the problem seems to derive from an alleged failure of the legal adviser to provide advice of a sufficiently high standard. In other cases, sadly, we have come across British citizens who have simply not taken adequate legal advice in the first place. Of course, there are others who, on the face of things, would seem to have been the victims of deliberate misrepresentation. Every case is different, which is why it is difficult to provide a template that will apply equally to every individual case.

European Union Referendum Bill

William Cash Excerpts

Monday 7th September 2015 Commons Chamber

[Mrs Cheryl Gillan (Chesham and Amersham) (Con)]

Will my right hon. Friend give way?

[Sir William Cash (Stone) (Con)]

rose—

[Mr Lidington]

If I may finish this point, I will then give way.

In addition, those areas of Government activity that are permitted by Parliament will be subject to guidance from the Prime Minister to Ministers and from the Cabinet Secretary to civil servants based on the purdah guidance issued before previous referendum campaigns. The Cabinet Secretary said in evidence to the Public Administration and Constitutional Affairs Committee that civil servants would not under any circumstances be permitted to support Ministers in doing things that Ministers were prohibited by statute from taking part in.

--- Later in debate ---

[Sir William Cash]

Of course my right hon. Friend has received legal advice, but legal advice can cut both ways. Indeed, Speaker’s Counsel has made it clear that he does not think there is much of a problem in respect of the issues the Minister has just been describing. Not only have the Electoral Commission and Speaker’s Counsel been clear on these points, but if regulations are introduced, they will come in by way of the affirmative procedure after the Bill has been enacted and there will be no opportunity to amend them, because regulations, being statutory instruments, can only be accepted or rejected in their entirety. Does my right hon. Friend not agree?

[Mr Lidington]

In answer to my hon. Friend’s last point, if the House is dissatisfied with any regulation that the Government put before Parliament, it can reject the statutory instrument. In that case, the default position under the package that I am proposing to the House would be to revert to section 125 without the exemptions being made by regulation. There is, therefore, the safeguard that Parliament will have the final say.

I hope that my hon. Friend will listen when I address the concerns in more detail, but I say to him first that I have been present at a number of debates in the House when he has said that a legal opinion that he has received is of weight and importance. I think that the Government are entitled to take seriously the arguments that Treasury counsel have put to them.

--- Later in debate ---

[Mr McFadden]

Our concern is that, instead of reinstating purdah and then having an exceptions regime, the Government propose to both have an exceptions regime and change the definition of purdah in such a way that there might not even be a need for an exceptions regime.

In the end, the various amendments and new clauses tabled set out three possible ways to deal with this issue. The first is simply to reinstate the purdah regime with no exceptions or modifications—the route perhaps favoured by some in this House. The second way is to reinstate the purdah regime but have a mechanism for exceptions that are subject to the approval of the House through regulations. That is the approach we have set out, and that the Government have, we acknowledge, moved a considerable way towards with the tabling of new clause 10. The third option, which is the one the Government seem to want to pursue, is both to water down the definition of purdah and have an exceptions regime; that is the combined effect of new clause 10 and amendment 53. We believe that the second approach—to have purdah, with exceptions where there is the approval of this House—is the right one.

[Sir William Cash]

If the vote on amendment 53 is successful and it is knocked out, there will be a vote on amendment 4. Does the right hon. Gentleman accept that the consequence of that would be to go back to the full purdah arrangements without any let or hindrance?

[Mr McFadden]

That would be the case if we did not have new clause 10; yes, amendment 4 would reinstate the full purdah regime, but new clause 10 allows the Government to come forward with regulations dealing with the points the Minister has made about the need for exceptions to this. In that regard, new clause 10 has a lot in common with Opposition new clause 6.

[Mr McFadden]

As I have said, there is a great deal of overlap between new clause 6 and new clause 10. As I indicated, our voting position is that we will support using new clause 10 to deal with these issues because there is so much overlap between it and our new clause 6. We will oppose Government amendment 53, and we will support our amendment 4.

[Sir William Cash]

The right hon. Member for Gordon (Alex Salmond) made a very sensible point on the differences between my amendment 78 and amendment 4, because mine takes account of this issue, as the right hon. Gentleman conceded by saying it could be dealt with subsequently with regulations in relation to Scotland, Wales, Northern Ireland and Gibraltar. I cannot understand why the Opposition cannot take that on board.

[Mr McFadden]

The hon. Gentleman is entitled to speak to these issues later in the debate, if he decides to move his amendment 78.

Many other Members will also want to speak in this debate. However, for all the heat generated by this issue of purdah, we should not mistake it as being more important than the issues of substance that this referendum is about. The Bill before us by definition focuses on the rules of the referendum, and there has been a great deal of heat about that, but the arguments about our future place in the EU and the world are a lot more important, and when our debates here are done we should focus on those, rather than the process and the rules and regulations surrounding the poll.

It is important that the referendum be conducted fairly. The objections to the Government position have been made because people want to ensure that it is conducted fairly. While we want change in the purdah regime, we should not be drawn into one process argument after another, which always sets this up as being an unfair referendum process. As I said at the beginning, the Government have probably got themselves into a fight that they did not entirely intend to get into. Some of the suggestions as to what is caught by section 125 make it look too widely drawn. The approach that we have set out is to reinstate the purdah regime, but allow the Government to bring forward regulations to deal with the problems that the Minister set out. That is a sensible way forward that would neither give too much latitude nor ignore the issues that have been raised in today’s debate.

--- Later in debate ---

[Mr Jenkin]

That is absolute nonsense. Even in a general election, Ministers can get advice from their Departments. Ministers also take advice during local government elections. If something happens that is unconnected with the referendum, Ministers will be able to take advice. I have heard it said that Ministers want to use their private offices to organise their speaking tours and to use their special advisers, who are paid for by the taxpayer, to campaign in the referendum. That is not an acceptable use of public money. What is the point of placing spending limits on the yes and no campaigns if the Government are going to avail themselves of all those advantages? My right hon. and learned Friend could persuade the Government to produce a White Paper to set out their case well in advance of the purdah period. That is an unimpeded advantage of which the Government can avail themselves. All we are saying is that there should be something of a level playing field in the last 28 days.

I regret that the Opposition accept new clause 10; nevertheless I am grateful that they support amendment (a) in order to create a framework for the creation of regulations. I am very unhappy with amendment 53. As the Opposition spokesman, the right hon. Member for Wolverhampton South East (Mr McFadden), made plain, to have amendment 53—which already adulterates section 125—without the scrutiny process of regulations and a specific debate about what Ministers actually want to exempt is a shot from a double-barreled shotgun against section 125 of the Political Parties, Elections and Referendums Act 2000. If the Government want to provide exemptions, they should introduce the amendments under regulations rather than under amendment 53.

The advantage of defeating amendment 53 is that we will be able to have amendment 4 instead. It was the unanimous view of the Public Administration and Constitutional Affairs Committee that section 125 and its effect on this referendum should be restored unimpeded. That would be the effect of amendment 4, but there may be some tidying up to do.

[Sir William Cash]

Does my hon. Friend accept that, while we may end up voting for amendment 4, amendment 78 is better, simply because it deals with the problems of the devolved territories? As I put it to the Opposition’s Front-Bench spokesman, the right hon. Member for Wolverhampton South East (Mr McFadden), even if we end up with amendment 4, the consequence will be that we will still be thrown back by new clause 10, which will leave it all to regulations. As far as I am concerned, that is highly unsatisfactory.

--- Later in debate ---

[Alex Salmond]

I wish to speak to amendment 11, tabled in my name and those of my hon. Friends.

The Chair of the Public Administration and Constitutional Affairs Committee, the hon. Member for Harwich and North Essex (Mr Jenkin), had my rapt attention and much of my agreement until he produced the remarkable argument that if purdah was good enough for Tony Blair, it should be good enough for the House now. I am afraid that the alliance of scepticism against the Government’s motives was dissolved as a result of that one phrase, that one single disastrous rhetorical flourish.

The hon. Gentleman made another point with which I disagreed, and I want to put this on record before I come to the points on which I agreed with him. He wandered into a period outside the purdah and asked whether at that point the Government had the right to publish a White Paper giving their point of view, backed as a democratically elected Government by the civil service. Of course they have the right to do that, but the House should be concerned about whether the restrictions should apply during the 28-day purdah period, or perhaps for a week longer were the Electoral Commission to have its way. I think that they should, and I shall illustrate that view with a cautionary and moral tale from the Scottish referendum.

The Scottish referendum was regulated not by the Political Parties, Elections and Referendums Act 2000—PPERA—but by the Scottish Independence Referendum Act 2013. The Act made provision for a statutory purdah period in Scotland during the 28 days leading up to the referendum. According to the explanatory notes, part 4 of the Act provided that,

“for the 28 day period ending with the date of the referendum, the Scottish Ministers and certain public authorities in Scotland cannot publish any material providing general information about the referendum, dealing with issues raised by the question to be voted on in the referendum, putting any arguments for or against a particular answer to the question to be voted on, or which is designed to encourage voting in the referendum.”

In other words, acting in their capacity as Ministers, they were not allowed to use the Government machine during the purdah period to advance the yes cause to which they were all committed. I must point out to those on the Government Front Bench today that nobody interpreted that to mean that this First Minister or any other Scottish Minister should not take part in the referendum campaign. The explanatory notes to the Act went on to state:

“However, this rule does not apply to information made available following a specific request; specified material published by or under the auspices of the Scottish Parliament Corporate Body; any information from the Electoral Commission, a designated organisation or the Chief Counting Officer or any other counting officer; or to any published information about how the poll is to be held.”

In a situation that was every bit as disputatious in regard to the arguments for and against, those measures in the Act were passed with hardly any dissent, rancour or suspicion of motives. It was accepted that that was the right thing to do. Perhaps the Government should have suggested something similar for this referendum, instead of doing whatever they were doing during the recess, unless they are seriously arguing that the constitution of this country involves a much simpler process for a European referendum. Had they done that, they would not now find themselves in this embarrassing position.

[Sir William Cash]

Does the right hon. Gentleman recall that the EU dimension of the Scottish referendum was pretty hot? I seem to remember President Barroso and others making statements about the single currency, for example. I speak now as the Chairman of the European Scrutiny Committee. Does the right hon. Gentleman agree that the arguments about the EU business that have been put forward by the Government are rather specious, given that the EU dimension of the Scottish referendum was really very volatile?

[Alex Salmond]

Yes, indeed it was, but we are discussing the 28-day purdah period at the moment. It has been suggested to me by a knowledgeable European that President Barroso, as he then was, harboured ambitions to be the Secretary-General of NATO and was hoping for support from Ministers—perhaps not those in the Chamber tonight, but those who are none the less not too far from us. Who knows why President Barroso made those interventions, but they were not made during the 28-day purdah period.

The cautionary aspect of this tale is that that purdah period, enacted in legislation, bound the Scottish Government and their agencies and public bodies in Scotland but it did not bind the United Kingdom Government. The UK Government were bound not by statute but by the Edinburgh agreement of 15 October 2012. That was what we used to call a gentleman’s agreement; it had no statutory basis. Paragraph 29 of that agreement stated:

“The Scottish Government will set out details of restricted behaviour for Scottish Ministers and devolved public bodies in the Referendum Bill to be introduced into the Scottish Parliament. These details will be based on the restrictions set out in PPERA. The UK Government has committed to act according to the same PPERA-based rules during the 28-day period.”

Now, I do not think that they did that. I do not think that most reasonable Members of this House believe that that is what was done. I will give two examples from among the many that I could use.

The first is, I admit, arguable, but it has already been raised on the Conservative Back Benches. It relates to the production of the vow when there were 10 days of campaigning left. The vow was described by the Chancellor of the Exchequer on “The Andrew Marr Show” on 7 September 2014 in this way:

“You will see in the next few days a plan of action to give more powers to Scotland, more tax powers, more spending powers, more powers over the welfare state.”

One of the arguments in favour of purdah is that the arguments should be laid out and set before the campaign period, and that during the campaign the politicians can debate them and the people can participate in the debate—as they did in huge numbers in Scotland—and make up their minds. It is not meant to be a period during which politicians can say, “Here’s a fresh initiative that we forgot to mention earlier.”

A comparison could be made with the European referendum if, for example, what used to be called the no side were to take the lead, unexpectedly perhaps, with 10 days to go and the German Chancellor or the President of the Republic of France were to suspend Question Time in the Bundestag or the National Assembly, get on a plane and rush across to say that the Prime Minister’s renegotiations of our position had suddenly found more favour with them than had previously been the case.

I accept that this point is arguable. Others could argue that the vow was not really a Government announcement from the Chancellor of the Exchequer, and that he was just speaking off his own bat as a politician. I am not sure that that is a good argument, but it is certainly a cautionary tale.

--- Later in debate ---

[Alex Salmond]

That question was some time in the gestation, and I had moved on from what I described as the “arguable” case of the vow. The vow was not a single appearance on “The Andrew Marr Show”, and I used the quote from that show just to demonstrate to the House that the vow was presented as a new initiative, something different, a last-minute offer. The argument about whether the vow breached purdah has been made well by the hon. Member for Shipley (Philip Davies) and the analogy in a European referendum would be a re-presentation. Presumably, the idea in the European referendum is meant to be that the Prime Minister renegotiates this country’s relationships with the EU and then presents that to the people for consideration of whether they want to be in or out on that basis. The equivalent idea here, therefore, would be that he finishes that renegotiation but things are going badly in the campaign and so there is a further renegotiation and re-presentation. I certainly do not believe that is within the spirit of a purdah regulation, although people might argue that it meets the letter of it.

I accept that that point is debatable—I am pretty clear which side I am on—but there is no debate whatsoever about the behaviour of officials in Her Majesty’s Treasury in the referendum unit who were actively briefing and intervening during the campaign. The reason that was allowed to happen is that, as the Chair of the Select Committee said, the civil service code does not specify referendums in the way that it does elections and there was no statutory basis for the enforcement of purdah in the UK Government as there was for the Scottish Government.

[Sir William Cash]

In the light of the interesting argument and the factual information that the right hon. Gentleman is giving the House, I wondered whether he had had an opportunity to discuss these matters with the Opposition and what the outcome of those discussions might be as to whether they would support the kind of enforcement arrangements he has in mind.

[Alex Salmond]

I have had some chats through informal channels, but I was hoping that the hon. Gentleman’s warm reception to my point might convince those in all parts of the House that there was something sensible in not just talking about purdah but actually having an organised enforcement mechanism and putting in place my amendment’s suggestion of

“measures to determine breaches of purdah and penalties for such a breach”.

As I say, I am open to the suggestion from the hon. Member for North Down about involving the Electoral Commission or about its involving a committee of Privy Counsellors—just so long as there is an enforcement mechanism. The evidence from last year, when there was no statutory basis or enforcement mechanism, was that there are people who will drive a coach and horses through a purdah period.

I am pro-European to my fingertips. I am more pro-European than I suspect most Conservative Members will ever be and certainly more than the Prime Minister will ever be, but I want to see this referendum conducted on a fair and proper basis. That includes a purdah period and, when it has been agreed, everybody sticking by the rules and there being an enforcement mechanism to make sure that they do so.

[Sir William Cash]

I would just like to take up the point that the right hon. Gentleman ended on. For all the reasons that I gave in Committee, when I put the case for going back to section 125 in its complete integrity, in order to have fairness it is essential that we have something by which people abide. A lot of this debate tends, from time to time, to move between what the Conservative party says or what Labour, the Liberal Democrats or the Scottish National party say. First, it was decided that we were going to have a European Union referendum Bill, and now the Electoral Commission has changed the nature of the question, with the consent of the Government. The question now is, “Do you, the voters of this country, want to remain in or do you want to leave?” This has cut completely across all political parties. Therefore, although this debate is taking place in this Chamber, the nature of this debate involving the Conservatives, Labour and the SNP must not be allowed to distort the fact that this is a vote about the real future of the individual people of this country. It is about the voters deciding for the first time since 1975 whether they are going to stay in what I regard now as a dysfunctional European Union—the immigration issue has recently made that even more obvious—or whether we are going to continue to argue that we should leave, because we can make that case. That is to come and the bottom line is that this Bill is not about “Conservative versus Labour”; it should be about the positions adopted across the Floor of the House. I know for a fact that many Labour Back Benchers agree with those who share my view on the Conservative Back Benches—and there are some on the Front Benches, too. It may well turn out that we will need to address the question later of whether or not Ministers should be allowed to participate on either side of the debate in the national interest.

I was particularly taken by and interested in the recent article the Minister wrote on “ConservativeHome”, in which he rather gave the game away. He and I have been discussing this since 1990, when he was special adviser to no less than the Foreign Secretary and other people in No. 10 were desk officers for the Government position at that time under John Major. Let me read what he said right at the end of his article, because I want to concentrate on the reasons for purdah. We have heard so many arguments in relation to the process. I have made my position quite clear, which is that amendment 78 is more comprehensive than amendment 4. Let me bypass that argument for the moment in the interests of trying to achieve the best result, but without prejudice to coming back to the matter at a later date.

In the final paragraph, the Europe Minister said:

“Ultimately, this is about the EU’s effectiveness as a whole. We want”—

whoever we may be—

“a dynamic, competitive, outwardly focused Europe, delivering prosperity and security for all of the people in the EU, not just for those in Britain.”

Actually, that is not what this debate on the referendum will be about. Elements of the argument will demonstrate that there are certain advantages in having a degree of alliance and co-operation in Europe, which I am in favour of, but not on the basis of the status quo of the treaties, or of the tweaking of negotiations that do not make any substantial difference to the basis on which those treaties are conducted. That is why I have firmly concluded that we must leave the European Union. I have just come back from Luxembourg—[Interruption.] The Foreign Secretary can ask me any question from the Dispatch Box. I have just come back from Luxembourg where the national chairmen of a whole raft of EU committees were debating questions relating to migration. I can only say that the trend of the arguments was not at all in line with many of the things that we in this House would have expected had those arguments been put forward by our own Ministers.

Basically, I am cynical, to say the least, about the outcome of this debate. The trouble is that we are being invited to cut across the fact, as my hon. Friend the Member for Harwich and North Essex (Mr Jenkin) has said, that there have been four referendums without any legal problems. Furthermore, the Electoral Commission has backed amendment 78—it did not mention amendment 4 because it knows that my amendment deals with the devolved territories as well—and we have Speaker’s Counsel on our side. We are told by the Minister that, as far as he is concerned, there are a number of legal opinions, including from two leading counsels, that have indicated that there could be legal problems. Well, that is not what the Speaker’s Counsel says. His advice relating to the Political and Constitutional Reform Committee is on the website for anyone to see. He has reinforced his view in the light of the remarks made by the Europe Minister on “ConservativeHome”. I expressly sent the Speaker’s Counsel a copy of that article and asked him whether he would revise his legal view. He is very distinguished and was the legal adviser to the European Scrutiny Committee for many years. He has also been involved in the legal service of the European Commission. He knows what he is talking about, and I take these other legal opinions that we are being offered with a pinch of salt.

Finally, I say to the Foreign Secretary, who is chuntering quite a lot—I say that with great respect because I rather like him—that if those opinions are so important, let us see them. Let us see the basis on which the advice was given, and we will hear the same old arguments that we heard about the Iraq opinion. At the end of the day, however, we did get the Iraq opinion. This issue may not be quite so momentous, but none the less to fall back on the old canard that we should not publish opinions is not actually an answer to the questions that we are asking. We want to know the basis on which the advice was given.

I just do not believe that the Government’s arguments add up. A lack of trust has been generated, which goes deep into the past—right the way back to the White Paper of 1971 when we were promised that we would have a veto, which has now been overridden. We have not been given a referendum since 1975, and it is essential that we have a fair referendum that people can trust. I fear that the outcome of the vote this evening will be that new clause 10 goes through, perhaps with an amendment that might make a marginal difference. A vote against amendment 53 will simply allow a vote on amendment 4, which takes us back to a kind of purdah, but not the complete purdah that I and I think the British people want under amendment 78. We are the representatives of the people, which is why I wish to speak so candidly on this matter.

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[Mr Paterson]

I am grateful to my right hon. Friend for that helpful intervention. I would like the Minister to try to cite a single example of purdah rules infringing the ability of the Minister with responsibilities in the areas affected by those referendums to act effectively.

I do not have much time, but I want to mention one interesting organisation, the European Commission for Democracy through Law, which is better known as the Venice Commission. It is the Council of Europe’s advisory body on constitutional matters. My interpretation of its guidelines on referendums is that they seem to be breached by the current UK Government’s stance on purdah. I would be very interested to hear my right hon. Friend the Minister’s comments on that. To help his team, the guidelines to which I am referring are the “Guidelines for Constitutional Referendums at National Level”, which state that

“public authorities (national, regional and local) must not influence the outcome of the vote by excessive, one-sided campaigning.”

In 2005 the commission published “Referendums in Europe: An Analysis of the Legal Rules in European States”, which noted approvingly that countries such as Ireland, Portugal and Latvia have strict provisions for electoral neutrality. Even the Russian Federation has neutrality rules. It would be interesting to know where we feature in that regard. Also, have the Government looked at the most recent code of practice on referendums from 2007, which makes it very clear that respect for equality of opportunity is crucial for referendums and elections?

The most recent endorsements of the proposals are in amendment 4 and in amendment 78, which was tabled by my hon. Friend the Member for Stone, and which I have signed. It is worth noting that the Electoral Commission has stated:

“We have not identified problems with the workability of section 125 of PPERA applying to governments at previous referendums, and so we think that it should be workable in relation to this referendum.”

I am afraid that everything I see this evening will be a mess. The only really clean solution is to go back to purdah, as outlined in the debates when we reluctantly agreed 28 days, and we can do that with amendment 78. I would like to hear what the Minister’s legal advice is. The Speaker’s Counsel—this has been mentioned twice, but I will mention it a third time—has said clearly that making statements on European Councils and putting them in press releases is allowed because they do not infringe section 125. Let me just put that on the record. Section 125 refers to material that

“(a) provides general information about a referendum…

(b) deals with any of the issues raised by any question on which such a referendum is being held;

(c) puts any arguments for or against any particular answer to any such question”.

As a layman, I just do not see how a Minister going to a Council, putting that into a statement and then repeating it in a press release can infringe section 125. I would really like the Minister to put the legal advice he has received in the Library.

I will bring my remarks to a swift conclusion. I do not like new clause 10. We will have to trust the Government to produce a list of exemptions. It is entirely black and white; we either accept or we reject. It would have been much better if the Government had put those exemptions in an amendment, as they have done with amendment 53. Why not consider the other exemptions in a full debate such as this, rather than a take-it-or-leave-it statutory instrument? I am convinced that the only real solution is to go back to the proper purdah that we thrashed out previously, which worked in previous referendums.

[Sir William Cash]

Does my right hon. Friend have some sympathy with the amendment tabled by the right hon. Member for Gordon (Alex Salmond) on the enforcement of purdah, because we are getting into a bit of a mess on this, as my right hon. Friend has said? If there was some means of enforcing the purdah that is left, we might have at least some leverage over what happens later.

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[John Redwood]

I rise to speak on the issues of the independence of broadcasting and campaign funding covered by two of the new clauses. It is most important that we should have a fair referendum and I think that the House has made a wise decision this evening to further that aim. I hope that the nation’s leading broadcaster, the BBC, will enter into the spirit of wanting that fair campaign and will study and understand where those who wish to stay in and those who wish to leave are coming from. It needs to learn that in the run-up to the referendum campaign proper as well as in the campaign itself. My hon. Friend the Member for Stone (Sir William Cash) has tabled a suitable new clause to try to ensure that that happens and I hope that the Minister will share our wishes and might have something to say on this point.

I notice that in recent months it has been absolutely statutory for practically every business person being interviewed on business subjects and subjects of great interest to consumers and taxpayers to be asked for their view of whether their business would be ruined if we left the European Union. The question is always a leading question and they are treated as somewhat guilty or suspect if they do not immediately say yes, of course, their business would be ruined if we were to leave the European Union.

[Sir William Cash]

Does my right hon. Friend sometimes wonder how these people come to be asked to go on the programme?

[John Redwood]

It would be far too dangerous for me to speculate on that without more factual information at my disposal. My hon. Friend is being slightly mischievous. I could not possibly agree with him and call into question how people are invited to BBC interviews. However, it is interesting that the one argument that the campaign to stay in the EU seems to have—that leaving the EU would be bad for business and jobs would be lost—has become a constant refrain in all BBC interviews.

The BBC seems devastatingly disappointed when a lot of businesses take the opposite view. It was fascinating to hear the wonderful interview with Nissan last week. The whole House will welcome the great news that Nissan has a very big investment programme for the United Kingdom’s biggest car plant, which will carry it through the next five years and beyond with a new model. When the BBC tried to threaten that investment by asking, “Wouldn’t you cancel it if the British people voted to come out of the EU?”, Nissan said, “No, of course we wouldn’t.” It is about the excellence of the workforce, the excellence of the product and access to an extremely good market here. It is in no way conditional upon how people in Britain exercise their democratic rights.

It is that spirit—the spirit of Nissan—that I hope the BBC will wish to adopt when contemplating such interviews in future. I hope that it will understand that most business interviews over the next few months should not be about the politics of the EU; they should be about whether the company is doing well—creating jobs, making profits and investing them wisely. If the business is misbehaving, then by all means the interview should be about the allegations.

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[John Redwood]

That is a good point. The other constitutional point I would make about businesses is that in an entrepreneurial business where the entrepreneur-owner-manager owns 51% or more of the shares, of course they speak for business, so if they say, “I want to stay in,” or, “I want us to pull out,” that is not only their view but the view of the whole business. I can understand that and it is very interesting, but quite often the people being interviewed are executives with very few shares in very large companies, who have not cleared their view through a shareholder meeting or some other constitutional process. The BBC wishes to give the impression that that is the view of all the members of the company, whereas in fact it is just the opinion of an executive. It is interesting, and the executive may be quite powerful, but he does not necessarily speak for the company, and that is never stressed in the exchanges.

[Sir William Cash]

Does my right hon. Friend accept that, quite often, what is interesting is which questions are not asked, as well as those that are asked and the people who are put on? For example, some of us have for a long time been making the argument, based on House of Commons Library statistics, that we run a deficit with the other 27 member states of about £62 billion, whereas the Germans run a surplus with the other 27 member states of about the same amount or more. Why does that sort of argument never get aired or heard?

[John Redwood]

I am being tempted into byways on the substance of the debate in the forthcoming referendum, but my hon. Friend is absolutely right. We would like to hear more questioning of our deficit and a reminder that we are the customers more than the producers; it is the other way round for the Germans. It is unusual for the customers to be in a weak position and the producers in a strong position.

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[Mr McFadden]

My good and hon. Friend anticipates my reply. He is right that history comes into play here, and not always in a linear manner. The thing that unites citizens of the Republic of Ireland and the other examples he mentioned is that they are part of the parliamentary franchise. He is right to say that it is not strictly about citizenship, but about who can vote to elect a national Parliament.

It remains the case that throughout the European Union when countries have had referendums of this type they have not extended the vote to citizens of other countries. It is important to state that, because too often the debate becomes about the value of the contribution of those citizens to the UK. That is not in dispute at all. The issue is having consistency in how we take decisions on our nation’s future.

The exchanges that took place on broadcasting impartiality showed the dangers of those proposals. We should allow broadcasters to do their job. The Opposition do not favour the appointment of a broadcasting referee. I do not think that the finest moment in the Scottish referendum was the mass demonstration outside the headquarters of the BBC in Glasgow, calling for the head of the political editor. I hope that we do not see that in this referendum. I am therefore not in favour of proposals that seek to set up some kind of referee to go through BBC news bulletins and second-guess who should and should not be interviewed. We should allow our broadcasters to do their job.

[Sir William Cash]

The right hon. Gentleman is clearly referring to my new clause. He ought to take into account the fact that that the Secretary of State, in correspondence with the chairman of the BBC Trust and Ofcom—the right hon. Gentleman may or may not have seen it—has quite a lot to say about the necessity of improving the manner and process of adjudication. I will deal with that in a moment.

[Mr McFadden]

I look forward to the hon. Gentleman’s speech, but it will take more than a letter from the Secretary of State to the BBC to convince us that some kind of broadcasting referee is needed to adjudicate in this process.

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[Mr McFadden]

I will just say that if the hon. Gentleman takes a sense of pride from the demonstration that took place in Glasgow, he is entitled to his view, but that is certainly not something I would feel. I do not think it was the finest moment in that referendum campaign.

On the date of the referendum, we have said all along that it should not be held when other important elections are taking place. In Committee, the House accepted a Government amendment ruling out the date of the elections due in May 2016. Our amendment 15 would also rule out holding it on the date of the elections due on 4 May 2017. I am glad to see that the Foreign Secretary has added his name to amendment 12, which would have the same effect.

Government amendment 23 deals with the new question wording put forward last week by the Electoral Commission. The Opposition respect the work of the Electoral Commission. Its job is to examine referendum questions and to comment on them. We therefore accept the change it suggests, but may I ask the Minister a couple of questions? Has he asked the Electoral Commission why it was appropriate to approve the question “Should Scotland be an independent country?” on a yes/no basis without an alternative statement about remaining part of the United Kingdom being deemed necessary? Has he asked why a yes/no question was approved for the referendum on the alternative vote a few years ago, but is not deemed appropriate this time? Does he know if this decision should be considered a one-off for this referendum, or whether we should expect all future referendums to be a choice between two alternative statements, rather than yes/no in answer to a proposition, as has often been the case in the past? As I said, we accept the new wording, but would like to know more about the reasons behind it and the contrast in the approach taken with other recent referendums.

Amendment 16 calls for a White Paper to be published outlining the terms of any renegotiation settlement the Prime Minister has reached and the consequences for the UK of leaving the European Union. We believe this is important because the referendum needs to examine not only our current relationship with the EU but what leaving might mean for the UK. This, too, was touched on in Committee. The Minister for Europe indicated at that point that the Government might produce a White Paper. May I press him on this tonight? Has further thought gone into that, and can he tell the House definitively that that will be the case? This is important, because voters deserve as much information as possible about what the decision on Britain’s future means. This will in the end be a choice between two futures and there should be information about both of them. Our amendment states that such a White Paper should be published at least 10 weeks before the poll, well away from any of the discussions about purdah, which applies to the final 28 days of the referendum period. We are not calling for Government information to be sent to every household, or for this to be a last-minute intervention. We are saying that at least 10 weeks from the poll it will be important to have a proper view on remaining and leaving. What does anyone advocating leaving have to fear from the consequences of doing so being set out in a White Paper?

This section of the amendment paper contains many other amendments, a lot of them dealing with technical points about registration, reporting and other issues, but the amendments on 16 and 17-year-olds, the White Paper and my other comments touch on the issues that we believe we should focus on in the period available to us.

[Sir William Cash]

I begin by referring particularly to my amendment on the impartiality of broadcasters. It will be observed that I have not confined my remarks exclusively to the BBC. I am aware, having been on the Broadcasting Bill in the 1990s, that the broadcasters have different regimes: the BBC has a royal charter and the other broadcasters are regulated by statute. I introduced an amendment to the second of the two Broadcasting Bills to ensure impartiality that was accepted by the now Baroness Bottomley when she was Secretary of State. Impartiality is a fundamental necessity in relation to the function of broadcasters. Given that £3.7 billion—I think—of the BBC’s total annual income of over £5 billion comes from the taxpayer, I think the taxpayer has an absolute right to be certain that there is no manoeuvring and completely unbiased reporting and comment.

I was deeply disturbed, as Chairman of the European Scrutiny Committee, when I set up an inquiry into the BBC’s handling of European issues, against a background that I will explain in a moment, when the right hon. Lord Patten, then BBC Chairman, refused three times to appear before the Committee. I had effectively to require him to do so through the aegis of the Liaison Committee, which unanimously supported my proposal. I had exactly the same experience with Lord Hall, who also refused three times. I again had to use the aegis of the Liaison Committee to ensure he appeared, which eventually he did. On the other hand, Rona Fairhead, who is now the Chairman of the BBC Trust and who did not have the protection of being a Member of the House of Lords, did appear. The correspondence, which is set out in our report, is interesting to read. Whatever the excuses given, both Lord Hall and Lord Patten, as Members of the House of Lords, were in a position to refuse a summons from a Select Committee. This seemed completely extraordinary, and eventually, through the good offices of the then Chairman of the Liaison Committee and others, both of them did eventually acquiesce, although Lord Patten subsequently resigned because of ill health. The bottom line is that it was a very serious situation.

It has been claimed in evidence to us, which I am now slightly paraphrasing, that the BBC is effectively completely independent. This is simply not the case. First, it has to report to Parliament. Secondly, its representatives ought to appear in front of Select Committees. I have to say that they do appear before the Public Accounts Committee and the Culture, Media and Sport Committee, but I am talking about the European dimension, which is my main concern and which is relevant to the conduct of the Bill, and to how the taxpayer will be affected if there is not complete impartiality

The late Hugo Young, whom I knew extremely well, wrote a book called “This Blessed Plot”. I knew him since we were about 10 years old. We both lived in Sheffield and more or less grew up together in our respective ways. We were not very close friends, but knew one another well enough. He went to Oxford as I did: he went to Balliol, I went to Lincoln. We used to speak to each other. He went on to become one of the most celebrated journalists in our time.

[Mr Speaker]

Order. I hope that the hon. Gentleman will not be too modest or self-effacing to inform the House that there is a chapter in that book named after him and devoted to a study of his activities.

[Sir William Cash]

I do not know what to say. That is true. I did not know it was going to be written. In a discussion over lunch during the Maastricht period, I heard Hugo Young, one of the greatest journalists of his generation, say “Bill, you’ve got The Daily Telegraph, The Times, the Daily Express and the Daily Mail; we’ve got the BBC.” I thought that was pretty revealing. The bottom line is that there is a serious concern here, although I believe it is now potentially capable of being remedied.

The BBC remains the most important source of news for the country. An Ofcom survey in 2013 noted that 34% of those who consume news named BBC 1 as the most important news source to them. According to Ofcom’s calculations, the BBC has the highest share of each of the platforms on which it has a presence— 56% on television, 64% on radio and 27% on the internet. As reflected in the conclusions of the European Scrutiny Committee report, after evidence was taken from wide sources, 58% of the public look to the BBC for the news they trust. This is very important, and we need to be certain about the degrees of impartiality maintained during the referendum campaign—not only for taxpayers and licence payers, but for voters, 58% of whom, as I say, look to the BBC for the news they trust. It is a hugely important issue.

Correspondence published recently by the Secretary of State for Culture, Media and Sport, following the report of the European Scrutiny Committee, is also important. I sent a copy to him as well as to the Prime Minister and others. The Secretary of State wrote to the chairman of the BBC Trust, which has the responsibility for enforcing BBC standards. He said that the corporation’s coverage of Europe had not been “faultless” in the past. A committee had been set up—in 2005, I believe—called the Wilson committee, which was extremely critical of the manner in which the BBC covered European issues. I was not surprised when I discovered from another source—I hope I am right in quoting it—that when it comes to newspapers, people in the BBC tend to come from what might be called The Guardian stable. The figures on that were interesting.

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[Philip Davies]

My hon. Friend rather glossed over the Wilson report, but it is important for us to remind people what Lord Wilson said. He said:

“While we have found no evidence of deliberate bias in BBC coverage of EU matters, we have found that there is a widespread perception that it suffers from certain forms of cultural and unintentional bias…The problem is complex. In essence it seems to be the result of a combination of factors including an institutional mindset”

and a lack of knowledge about the European Union. He also said:

“The BBC needs to take more care in the selection of interviewees.”

Does my hon. Friend agree that all the problems that Lord Wilson identified about the BBC coverage, whose existence the BBC itself accepted, are still there today?

[Sir William Cash]

There is a case, which my right hon. Friend the Member for Wokingham (John Redwood) touched on earlier, relating to the business news. In its report, our Committee referred to the business section which comes on at about six o’clock in the morning, and to what I hope will not continue to be a stream of people putting forward the pro-EU case. Given that the charter itself is under review and a consultation period is in operation, we look to the Secretary of State to ensure that the opportunity is taken to address this question as part of the review, and that includes addressing the question of public purposes.

The basis on which a chartered body operates is by reference to the objects of the charter, and those public purposes do not specifically include the impartial delivery of commentaries and news. The question of the charter is linked to the guidelines, and the guidelines are rather like a statutory instrument: they must have regard to what the charter says. On the other hand, the charter itself should specifically ensure that in its wording impartiality is an absolute.

[John Redwood]

Has my hon. Friend ever heard a BBC journalist ask someone how they would like to spend all the extra money we would have if we did not make a contribution to the EU, or is it just my bad luck that I have never been around when they asked that?

[Sir William Cash]

There have been suggestions, of course, that the BBC has been in receipt of money from the EU. My hon. Friend the Member for North East Somerset (Mr Rees-Mogg), who is not in his seat at the moment—he usually is—put that question to Mr Harding, and we were hoping we would get further information on the matter. We have, however, invited Lord Hall to return and he will be coming back to see the Committee quite soon. He has accepted the invitation this time—he has not been required to appear—and we are looking forward to getting an answer to that question, and many others.

[Mr Nuttall]

Perhaps when Lord Hall does appear, we might put a point to him about choosing interviewees, which is just as relevant in respect of businesses. We might suggest that when the BBC is seeking an anti-European Union viewpoint, it should not always go to members of UKIP, because there are members and supporters of all parties—not just the Conservative party, but the Labour party, too—whose views it could, and should, be seeking.

[Sir William Cash]

The hon. Member for Luton North (Kelvin Hopkins) and other Labour Members on my Committee put that very question to the witnesses—Lord Hall and Mr Harding in particular, as well as Rona Fairhead—because it is essential that all sides of the arguments are heard. As I have said repeatedly in this debate, this is not a party political issue in the sense that it is not Conservative versus Labour. The very fact that the referendum has been set up and the question is “Do you want to remain in or leave?” means that it is a national issue and therefore all the broadcasting authorities, including the BBC, must have regard to the fact that we are passing over in this Bill the entire conduct of the referendum. That means it must be conducted not on a party political basis, but on yes versus no and on the question: “Do you want to remain in or do you want to leave?” Therefore there must be impartiality. We do not just want a Eurosceptic view. Some might think, “I would want that, wouldn’t I?” but actually, no; it must be done on an impartial basis.

It is rather strange that the BBC was somewhat dismissive of News-watch, an organisation that runs a comprehensive analysis of all news programmes—who goes on, what questions are asked and the whole conduct of the BBC output. I am afraid that it seems to me that the BBC was somewhat dismissive of that, to say the least. I believe from what I have heard that the BBC does not in fact have its own monitoring system. If it does not have its own monitoring system, how is anybody to know whether or not it has been impartial, because that is like looking for a needle in a haystack? We do not have the facilities to be able to conduct the analysis for ourselves, but the BBC has £5 billion and I would have thought that was the least it could do.

[John Nicolson]

May I ask the hon. Gentleman the same question I asked earlier—although I might of course have overlooked his comments on this on billcash.com? Does he now regret the fact that the Conservative party acted as a cheerleader for bias during the Scottish independence referendum, and does he accept that that set something of a precedent for one-sided BBC coverage in referendums?

[Sir William Cash]

I do not blog so I am not in a position to answer the hon. Gentleman’s question. All I can say is that I would deplore any bias whether in the Scottish referendum or the European referendum, or indeed in just normal current affairs.

To return to my point, there is the facility for this if the BBC steps up to the mark and does in full what the Wilson committee report recommended and, more than that, what is in line with what the Secretary of State is now proposing. This is a hugely important question given that according to the BBC 53% of the British people depend on it for the news they trust.

[John Nicolson]

Would the hon. Gentleman accept, however, that apparently with the sole exception of the right hon. Member for Wokingham (John Redwood), there was broadcast silence from Conservative Members when there were dramatic examples of corporation bias during the Scottish referendum coverage? With all due respect, I never heard the hon. Member for Stone (Sir William Cash) utter a cheep in complaint about that, which makes us feel a trifle cynical about his motivation. One feels that it might just be about Europe rather than bias.

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[Sir William Cash]

I do not want in any way to sound as though I am drawing on the fact that I have been in the House for 30 years, but with great respect, the hon. Gentleman ought to know that I am not known for dodging issues or not taking a serious point seriously. If I did not say anything at the time, I do not regard that as a fault on my part, but if he is right about how the BBC dealt with the issue, I deplore it. I think that is all I can say on that subject for the moment.

The BBC recently published an annual report that was rather critical of the fact that Select Committees ask questions about the BBC’s performance on so-called editorial independence. I am not denying that it is important that the BBC should have a degree of independence in order to be impartial, but I think I have made the case that there has not been the complete impartiality that we believe the BBC should deliver to the British public. That is perhaps the result of the lack of a monitoring system, or perhaps because of a certain cultural bias of the kind that my hon. Friend the Member for Shipley (Philip Davies) mentioned, and we can see it in the evidence that we have accumulated in the European Scrutiny Committee and in the reports of News-watch.

What I read in a recent article by Rona Fairhead, the chairman of the BBC Trust, was peculiarly unsatisfactory. She stated in that article, published in the past week or two, that

“the BBC needs to be driven by evidence and fact, not by prejudice”.

However, in addition to what the annual report had said, she effectively stated that the BBC should not be subjected to Committee questions in the way that it is. I can only assume that she meant the European Scrutiny Committee, but perhaps she meant the Culture, Media and Sport Committee as well—my hon. Friend the Member for Shipley asks some tough questions when people from the BBC appear in front of that Committee. Rona Fairhead stated:

“Research carried out for the trust”—

on what basis I do not know—

“shows clearly that the public see a need for independent scrutiny and regulation, but they want this done by a separate body representing licence fee payers, not by politicians.”

However, we have overarching responsibility for the accountability of Ministers, and of the BBC, which has to appear in front of the Public Accounts Committee and so on. Rona Fairhead’s article continued:

“That independence has needed defending over decades, not just from governments but also from parliament, with a growing tendency in recent years for select committees to question BBC executives about detailed editorial decisions.”

That is quite an extraordinary statement.

We took evidence and legal advice, and the bottom line is that the BBC does not have complete, unfettered independence, editorial or otherwise. It has to comply with the charter. We make it clear in our report that we expect the impartiality requirements that are embedded in the framework agreement and other documents to be complied with in the light of what the charter states. The first port of call is what the charter says and unfortunately we felt, very strongly and unanimously, that the BBC had fallen short. We look to it to remedy that. I have referred to the correspondence on 15 and 18 June between the BBC Trust, Ofcom and the Secretary of State. I do not have the time to go into its recommendations in detail, but there seems to be recognition that something has to be improved.

[Philip Davies]

Does my hon. Friend agree that the BBC Trust is not good enough to regulate and monitor the BBC’s coverage, because not only does it regulate the BBC, but it is a cheerleader for it as well? That means that it is not in the best position to be an independent monitor of the BBC’s output, and the BBC Trust chairman’s rather snooty view of politicians having any say in what goes on is undermined by the fact that she herself is appointed by the Secretary of State for Culture, Media and Sport.

[Sir William Cash]

From what I have observed from press reports and elsewhere, she appears to have accepted that the BBC Trust is in need of significant reform. The general thrust is that the BBC Trust is bust. Basically, there will have to be a new system, and that is what the correspondence to which I have referred indicates.

Former BBC commentator and employee Robin Aitken’s book, “Can We Trust the BBC?”, covers many matters related to the European Union. I also recommend Peter Shore’s book, “Separate Ways”, the introduction of which contains some extremely pertinent views of the BBC as being deeply biased on EU matters, going back to meetings in the Connaught, alleged connections with the CIA and other similar issues.

News-watch has demonstrated the truth that

“in crucial respects, the BBC has not provided the Committee clear evidence that its EU-related output is properly balanced, informative and wide-ranging across all its platforms—or that the Corporation has raised its game in the ways urged by the Wilson report.”

I have given many of the reasons for that, and more will have to come out in our next inquiry.

[John Nicolson]

What would the adjudicator’s role be vis-à-vis the BBC Trust? Would the adjudicator have primacy over it? Would the trust’s power to make a ruling on the issue of bias be removed, or would the two compete with each other, giving perhaps contradictory rulings?

[Sir William Cash]

New clause 1 states:

“Notwithstanding any enactment or legal instrument”,

so that would affect the Broadcasting Acts and the charter. Under my proposals, the Secretary of State would make provision by regulations

“to ensure the impartiality of broadcasters during the referendum period.”

There would also be a requirement for

“the appointment by the Secretary of State of a referendum broadcasting adjudicator”,

who would be completely separate. In effect, during the referendum period, the adjudicator’s arrangements would take the place of those of existing broadcasting authorities and the BBC. I do not dispute the fact that the Government do not want to go down that route, but it has emerged from the correspondence between the Secretary of State, Ofcom and the BBC Trust that serious discussions are taking place to make sure that the BBC and broadcasting authorities generally are properly impartial during the referendum campaign. There are those who do not think that there is a problem, but there are many who think there is, and that it needs to be rectified.

Even if the Government do not accept my amendment, the elements that I have described will need to be addressed in the charter review. The problem is that it is highly possible, if not probable, that the conclusions of the charter review will emerge after the referendum. It is therefore a matter of urgency that we sort this matter out in the run-up to the referendum, and before the charter review is completed. We shall look into this in the European Scrutiny Committee proceedings, to which we have invited Lord Hall, and we will continue to look into it because we believe that it could have a significant bearing on the outcome of the referendum if the situation is not remedied. If, on the other hand, the matter is taken seriously by the BBC and the broadcasting authorities, we will be able to find a solution in the framework of the existing legislation. This is a really serious matter.

I will not spend too much time on the other amendments, except to say that I think I will get an interesting response from the Minister to my amendment 1, which proposes a referendum period of not less than 16 weeks. I shall therefore not dwell on that one. We have to have a proper length of time for the referendum, so that the arguments can be properly put and understood on all sides.

New clause 11 deals with the limit on the expenditure of registered political parties. We have taken advice on this, because it is a matter of grave concern that the political parties, three of which are known to be pro-EU in the broadest sense, might find that they had too much money at their disposal, or at any rate have what we think is too much money if we look at this from the point of view of those who wish to leave. We have proposed a cumulative limit of £14 million. We have also proposed:

“Each political party’s share of the cumulative limit shall be determined in proportion to its share of the total votes cast at the general election that took place on 7 May 2015.”

The new clause also proposes that

“the Electoral Commission shall calculate and notify each political party of its share of the cumulative limit.”

For practical purposes, I look to the Minister to give me his view on that one.

In addition, I have tabled amendment 3, which states:

“Regulations made under this Act or the 2000 Act in respect of the referendum must be made and come into force not less than six months before the start of the referendum period.”

We discussed some aspects of that in the debate on the previous group of amendments. A further amendment relates to the question of permitted participants and the European Union. I should add that quite a lot of my amendments have been endorsed by the Electoral Commission. The Minister can no doubt refer to that body as he goes through the amendments. This is not just a matter of Back Benchers coming forward with proposals; I have been in discussion with the Electoral Commission on many matters, including my amendment 78, which we covered in the previous debate. The commission endorsed that amendment, but unfortunately it was not accepted by the Labour party.

A significant number of Members have signed my amendment 2, which proposes that

“a permitted participant must not accept a relevant donation, irrespective of whether or not it meets the requirements of the 2000 Act and this Act, if the donation is funded directly or indirectly in whole or part from moneys, resources or support disbursed or allocated by or at the direction of the European Commission, its agencies or any related European institution to the donor or via other parties to the donor.”

The object is to ensure that no funds come from the European Union for the purposes of promoting pro-European arguments, including, obviously, the yes vote. It is an important amendment, and my hon. Friend the Member for Wycombe (Mr Baker) has sensibly suggested that we add the words

“Notwithstanding the European Communities Act 1972”,

just to make sure we do not slip up by finding that there is some law in the European Union that would contradict our proposals.

[Mr Baker]

rose—

[Sir William Cash]

Before my hon. Friend intervenes, I ought finally to add that the Electoral Commission does not agree with this.

[Mr Baker]

My hon. Friend has taught me many things, one of which is the importance of brevity.

[Sir William Cash]

I entirely agree with that, which is why I will now sit down.

[Mr Speaker]

The hon. Gentleman has concluded his speech. We are grateful to him.

--- Later in debate ---

[Sir Edward Leigh]

I wish to support my hon. Friend the Member for Stone (Sir William Cash) and his new clause 11, but the House will be relieved to hear that I shall do so rather more briefly. There is a quote by Sir Winston Churchill in the No Lobby, which says that he wanted to spend the first million years in heaven painting. As much as I love my hon. Friend, I fear that I might spend the first million years in purgatory listening to his speeches.

[Sir William Cash]

Shame. You might learn something.

[Sir Edward Leigh]

My hon. Friend has identified an important point. The Minister will remember that I made precisely this point in my amendment 53 in Committee, before our summer break.

Although there has been a lot of fire and emotion and a vote tonight about purdah, the question of spending by both sides is probably more important. Lord Lamont, the former Chancellor, has written a number of articles about it. It is incredibly important when we have the referendum that we get a sense of closure. At the end of this, whatever the result, people should feel that it has been broadly fair. Otherwise, we might reap the whirlwind. We should remember what happened after the Scottish referendum. If the yes campaign should win, we do not want to create a sense of unfairness for the other side.

I know that my hon. Friend the Minister has taken seriously the points I have put to him. In our earlier debates, the way he put it was that there should be a “broad equality” of forces, but we fear that that simply will not happen. Although there are sensible, firm and clear limits on how much public money will be available to the no and yes campaigns—say, £600,000 or something on each side—and that is completely fair, the party establishment of the main political parties, the Conservative party, the Labour party, the Liberal party, and the SNP, will almost certainly campaign to stay in Europe. Their ability to spend will be based on the votes that they got, with the Conservative party allowed to spend £5 million, the Labour party £4 million, the UK Independence party only £3 million—they will be the only people on the other side—and the Liberal Democrats £2 million. We could reach a situation in which the yes campaign is spending up to £17 million and the no campaign only £8 million.

That has already happened once before. In 1975, the no side was outspent 10:1, which simply cannot be fair. When I put those points to my hon. Friend the Minister in the past, he said that although he accepted that morally and logically there was force in my arguments, that was not in our tradition, as we do not have limits for general elections. I am sure that he will make the same argument again tonight. However, a general election is somewhat different. Separate political parties all have their own position that they are putting forward, rather than ganging up, in a sense, on one side of the argument. There is no sense of unfairness at the end of the process, or a sense that one important political point of view has been massively outspent by the other side.

Although I accept that the Minister will make those arguments, I hope he will feel that there is some sort of moral force in what we have said. For instance, the official yes side in the AV referendum spent £3.436 million and the official no side spent £2.995 million. There was a broad equality in what the yes campaign and no campaign were spending on the AV referendum, was there not? I think we all felt it was a fair referendum. The arguments were put, there was a clear decision and people accepted it. Surely we do not want to be in the situation that has arisen with so many other referendums in Europe, in which there is a sense that the political establishment—the European establishment—has a massive imbalance of resources on its side when it comes to spending. That creates a sense after the referendum that it has somehow been unfair.

Our sole UKIP Member is not present for this important debate, but we do not want to create a situation like the one that existed after the Scottish referendum, do we? There was suddenly a great surge in support for the SNP, and we would not want to recreate that position. [Hon. Members: “Why not?”] There will not be a surge in support for the SNP after this referendum; there might be a surge in support for somebody else, which SNP Members might not welcome.

I hope that when the Minister replies to the debate he will try to convince us that the Government do want a broad equality of resources during the campaign, so that we can feel that the yes and no campaigns have put their points of view fairly, that the public have listened to their arguments and that a fair decision has been made.

European Union Referendum Bill

William Cash Excerpts

Thursday 18th June 2015 Commons Chamber

[Mr Lidington]

Obviously, what we discuss on Report will be in the hands of Members who table amendments. I have known my hon. Friend the Member for Stone (Sir William Cash) for many years, and I know that he is ingenious and creative in finding opportunities for parliamentary debate on subjects that are close to his heart.

[Sir William Cash (Stone) (Con)]

With great respect, may I be ingenious for one moment, as I wish to put amendment 8 on the record? The amendment is supported by the Electoral Commission. Given the time that is available, I just want to say that the Electoral Commission supports the proposal, which is that the detailed regulations required to administer and regulate the referendum

“must be made and come into force not less than six months before the start of the referendum period.”

We do not propose pressing the amendment to a vote, but we would like to return to it on Report. I know that the Minister understands it, and that the Electoral Commission supports it.

[Mr Lidington]

My hon. Friend’s amendment proposes that the legislation be put in place at least six months before it is required to be implemented or complied with by campaigners or administrators. Although it is not necessary or appropriate in this specific case to set an arbitrary timeframe in statute, I can offer him some reassurance on the point. The reason for the Electoral Commission’s recommendation, to which he alluded, is that it is important to ensure that the people who are responsible for organising and administering a referendum and the people who will be responsible for accounting for expenditure on behalf of campaign organisations are clear about the rules that apply. To some extent, as I said a few minutes ago, the general framework of those rules is set out in the body of the Bill. The more detailed rules on conduct will be provided for by regulations that the Government will have the power, under the Bill, to table.

I can assure the Committee that it is the Government’s intention to publish the conduct regulations this autumn. That will mean, especially given the decision that the Committee took on Tuesday not to combine the referendum with the devolved local elections in May 2016, that there should be plenty of time for the Electoral Commission, and returning and counting officers and campaigners to familiarise themselves with the detail of the rules under which the referendum will be conducted. We would expect those detailed rules to cover such matters as the referendum timetable and the key stages within that; the provision of polling stations; the appointment of polling and counting agents; the procedure for the issue of ballot papers and for voting at polling stations; the arrangements for the counting of votes and declaration of results; the disposal of ballot papers and other referendum documents; arrangements for absent voters and postal and proxy votes and so on.

There will be a great deal of information, which it is our intention to have publicly available for everybody to see in the autumn of this year, well ahead of the referendum date. I hope that on that basis my hon. Friend the Member for Stone and others who have signed his amendment will be reassured that the Government are fully committed to our declared intention of ensuring that the referendum is conducted in an way that is not only fair but that is seen to be and is accepted as fair by everybody who takes part on both sides.

European Union Referendum Bill

William Cash Excerpts

Tuesday 9th June 2015 Commons Chamber

[Mr Hammond]

The answer to question No. 1 is no and the answer to question No. 2 is that the Prime Minister has set out in a series of speeches, articles and interviews, and in the Conservative party manifesto, the key areas where we require change to the way that Britain’s relationship with the European Union works if we are to be able to get the consent of the British people to our future membership.

Conservative Members have long been clear that the European Union needs to change and that Britain’s relationship with the European Union needs to change. Unlike the Labour party, we believe that Brussels has too much power and that some of those powers need to be brought back to national capitals. In a world whose centre of economic gravity is shifting fast, Europe faces a serious challenge. If we are to continue to earn our way in the world and to secure European living standards for future generations, the EU needs to focus relentlessly on jobs, growth and competitiveness. Bluntly, it needs to become far less bureaucratic and far more competitive.

With the European electorate more disenchanted with the EU than ever before and with anti-EU parties on the rise across the continent, it is time to bring Europe back to the people, ensuring that decisions are made as close to them as possible and giving national Parliaments a greater role in overseeing the European Union. Such issues resonate across all member states. Change is needed for the benefit of all to make the EU fit for the purpose of the 21st century.

[Sir William Cash (Stone) (Con)]

I applaud my right hon. Friend’s opening remarks and the Prime Minister for making certain that we had the Bill. May I ask the Foreign Secretary one question? In the last statement made by the Prime Minister in the previous Parliament, he clearly said that he wanted reform and a fundamental change in our relationship with the EU. Will he explain what the second part of that means in practice and in relation to the debate?

[Mr Hammond]

My hon. Friend’s question is germane to the point I am making.

For the good of all 28 countries, there are things that need to be done to reform the way in which the European Union works to make it more competitive, effective and democratically accountable. However, the British people have particular concerns, borne of our history and circumstances. For example, we are not part of the single currency and, so long as there is a Conservative Government, we never will be. We made that decision because we will not accept the further integration of our fiscal, economic, financial and social policy—[Hon. Members: “We made it!”] The hon. Member for Eltham (Clive Efford) says that Labour made that decision. Is it the position of the Labour party that we will never join the single currency? I have not heard that position being articulated from the Labour Benches. It would be a seminal moment in our parliamentary history if Labour was able to make that commitment today.

We made that decision because we will not accept the further integration of our fiscal, economic, financial and social policy that will inevitably be required to make the eurozone a success. So, in answer to the point raised by my hon. Friend the Member for Stone (Sir William Cash), we need to agree a framework with our partners that will allow further integration of the eurozone while protecting Britain’s interests and those of the other “euro-outs” within the EU. Because we occupy a crowded island with a population that is growing, even before net migration, and a welfare system that is more accessible than most and more generous than many in Europe, we are far more sensitive than many member states to the impact of migration from the EU and the distorting effects of easy access to benefits and services and of in-work welfare top-ups to wages that are already high by comparison with many EU countries.

In the Conservative party manifesto, we therefore committed to negotiate a new settlement for Britain in Europe—a settlement that addresses the concerns of the British people and sets the European Union on a course that will benefit all its people. The Prime Minister has already begun that process by meeting 15 European leaders, and at the European Council in June he will set out formally the key elements of our proposals.

--- Later in debate ---

[Mr Clarke]

My right hon. Friend appears to believe that we can somehow have all the advantages of the European Union and the market without complying with any of the obligations. I know of no trading bloc that allows anybody entry to its markets on the basis that they will decide whether to comply with its rules.

I approve of the form of words in the Bill for the question but I hope, as the campaign goes on and we all form all-party campaigns, it becomes crystal clear what the question actually means. It is not solely about the negotiations for reform. Personally, I completely concede that the European Union has a lot of defects and is ripe for reform, and I approve very strongly of some of the measures, particularly those in the Bloomberg speech, which my right hon. Friend the Prime Minister is pressing for—if he can achieve them. However, the yes vote involves a decision on the future role of the United Kingdom in the modern world: how we are best able to further the interests of our citizens, defend our security, develop our economy and bring prosperity. That is the big question.

[Sir William Cash]

Will my right hon. and learned Friend give way?

[Mr Clarke]

I will not, because we are under a time limit and other people want to speak. I apologise to my hon. Friend. He and I have debated this frequently.

We are 1% of the world’s population and we represent 3% of the world’s GDP. As a proportion, we are declining yet further. On the question of being in the European Union, we need to get across to people that our effective voice in the world, insofar as we have one, is best deployed as a leading and influential player in the European Union. There will be less interest taken in British views by the United States, Russia, China, India and other emerging powers if we go into splendid isolation. As I have already said, the idea that we can somehow advance our future prosperity by withdrawing from the biggest organised trading bloc in the world, while at the same time, as a Conservative party, advocating wider free trade wherever it can be obtained, is an absurdity.

That leads me to the other argument: what does “out” mean and what does a no vote mean? I look forward to my Eurosceptic friends providing an answer to that, because Eurosceptics have always given different answers. My former hon. Friend who is now in the UK Independence party, the hon. Member for Clacton (Mr Carswell), has a quite different view of what a no vote means compared with some of my no voting colleagues on the Government Back Benches. Does it mean the Norwegian option? Do we stay in the trading area? That would mean we pay a large subscription, accept free movement of labour—Norway has a higher proportion of other EU nationals compared with Norwegians than we have compared with Brits—and comply with all the legislation, rules and regulations of the single market without having any say in them.

Do we go further than that and have the Swiss model? The Swiss model means we would have some access to the single market. However, in those areas we would have to comply with all the laws and rules that would be directly applied and have no influence on what they are.

--- Later in debate ---

[Sir William Cash (Stone) (Con)]

This referendum Bill, which I in principle strongly applaud, is the culmination of over 20 years of campaigning, which commenced with the Maastricht referendum campaign in 1993. I congratulate the Prime Minister on carrying out his commitment, which disproves the allegations and claims made not only by our opponents but even by some of his friends. The reason for the Bill was that he listened. He listened to Back-Bench opinion, and in particular to the amendment that we put forward resulting in 81 colleagues voting for a referendum on the EU issue on 24 October 2011. I urge him to listen again now and ensure that this referendum is fair in its procedures, in its governmental and EU involvement, and in the impartiality of the broadcasting authorities. I also ask him to properly address the question of fundamental change in our relationship with the EU, as I mentioned in my intervention on the Foreign Secretary.

It was Churchill who said:

“Why be afraid to tell the British public the truth?”—[Official Report, 18 July 1946; Vol. 425, c. 1451.]

That is what we have tried to do since those Maastricht days. When I am under attack not only by Nigel Farage but by my right hon. and learned Friend the Member for Rushcliffe (Mr Clarke), which I was recently, I know I must have got something right. Since Maastricht, we have moved the terms of trade on all essentials in respect of the historic question of “Who governs this country and how?”, which in one form or another has recurred throughout the centuries—about every 50 years from time immemorial. This decision will now lie with the voters, but for it to be conclusive, it must be a fair referendum.

I now turn to what the Prime Minister clearly stated on 23 March, in the full knowledge that it would be part of the general election. In the last week of the last Parliament, he said:

“we have the opportunity to reform the EU and fundamentally change Britain’s relationship with it.”

He then referred to the referendum and added:

“If I am Prime Minister, that is what I will do.”—[Official Report, 23 March 2015; Vol. 594, c. 1122.]

I referred to this in the meeting of the 1922 committee immediately after the general election.

[Kelvin Hopkins (Luton North) (Lab)]

May I take up the hon. Gentleman’s point about the need for a fair campaign on the referendum? It is very important for there to be a balance of voices, representing both sides, in the broadcasting media in particular. Does he agree that for too long the BBC has tended to see the issue of the European Union as purely a Conservative party matter, although people on the left as well as the right take sceptical views?

[Sir William Cash]

I entirely agree. The European Scrutiny Committee was unanimous in its report, which was severely critical of the BBC’s failure to be sufficiently impartial in relation to European matters. There will be further discussion of that issue as we continue to debate the Bill.

At the 1922 committee meeting, I made it clear that we would engage not in wilful opposition but in a process of mutual respect and debate. In plain English, what the Prime Minister said on 23 March boils down to the following. He said that he wanted to change the basic principles by which the United Kingdom is connected to the European Union. He carefully distinguished between “fundamental change” in our relationship and mere reform of it. Reform may include some treaty change to include issues relating to benefits and so forth, but they pale into insignificance by comparison with the Prime Minister’s own assertion that he wants “fundamental change” in our relationship with the EU.

In its report on referendums, the House of Lords Constitution Committee made it clear that a referendum would be primarily necessary in the event of a proposition that we leave the European Union, as opposed to mere nibbling at the treaties. I have said repeatedly for years that if we do not achieve this fundamental change, we will have to leave the European Union. That becomes essential if we are to govern ourselves in line with the wishes of the voters in general elections. In his Bloomberg speech, the Prime Minister said:

“It is national parliaments which are, and will remain, the true source of real democratic legitimacy and accountability in the EU.”

Nothing is more important than that when it comes to the government of our country and its freedom.

Other member states may seek to block this action, but they do so at their own peril. They need us politically and economically, and they repeatedly say that they want us to remain in the EU; but then the handouts, the bail-outs, the subsidies and the ideology of political union get in the way. We have positive alternatives to the European Union. Our democracy and our national Parliament are what people fought and died for in two world wars, and it was through their sacrifice that we saved Europe in those two wars. It is not in the interests of Germany, Europe or ourselves for us to remain in the second tier of a two-tier Europe dominated and profoundly affected by a de facto eurozone, which is in reality at the epicentre of the legal framework of the European Union itself, in which we have been embedded by successive treaties and which does not work.

[Mr Jenkin]

That is the most fundamental point that must be addressed by those who want us to remain in the EU on the present terms. For 20 or 30 years we have had a dysfunctional relationship with the European Union because we do not want to be in political or monetary union, and do not want to be absorbed into something that looks more and more like a state. If those people cannot answer the question how we can be at the heart of this Union on a completely different basis, we will indeed end up as a second-tier member state of an increasingly centralised European Union.

[Sir William Cash]

My hon. Friend is absolutely right.

Removing the words “ever-closer union”—which have never been specifically adjudicated on by the European Court of Justice, and merely form part of the preamble to the treaties—will not solve the problem. It does not change the legal obligations of the accumulated treaties, from Maastricht to Lisbon. Notwithstanding their protestations, it will not be the establishment, the EU, the BBC or the self-appointed multinationals with vested interests who will decide these matters. None of those multinationals has advanced a rational argument to support their determination to stay in the EU. That is my response to what was said by my right hon. and learned Friend the Member for Rushcliffe, who asked the same question of us from the other side of the argument. They were hopelessly wrong about the euro, and have been hopelessly wrong about so many aspects of European debate.

It is the voters who will give their verdict by the end of 2017. It is the voters, and the voters alone, who will decide it, not the massed ranks of the Europhiles. The rolling back of the treaties is imperative to our national interest. Indeed, the 1971 White Paper, on which the European Communities Act 1972 is still founded, clearly stated that we must keep the veto precisely because it was in our national interest to do so. It went on to say that to do otherwise would

“imperil the very fabric of the Community.”

I look at my right hon. and learned Member for Rushcliffe because he knows that he supported that at the time, in 1971.

[Mr Kenneth Clarke]

My hon. Friend is quite right. In 1971 we had unanimity when making European laws, but once made, they were directly binding. It is the second issue that my hon. Friend is trying to reopen. In the Lisbon treaty, we went for weighted majority voting, because, with 28 member states, giving every Government the right to block any proposal would prevent any decisions from being made.

[Sir William Cash]

It was for precisely to deal with that problem that I set up the Maastricht referendum campaign. My right hon. and learned Friend and others have persistently and continuously opposed a referendum, because they have not wanted these matters to be reopened. However, they have been reopened by virtue of this Bill.

I was concerned to hear the Foreign Secretary say on Sunday that the unilateral repeal of EU legislation at Westminster was unachievable, and would lead to our leaving the EU. Of course, the second part of that proposition is inherent in the referendum itself; the voters will decide. The Foreign Secretary invoked the analogy of the yellow card, which has been a dismal failure. When it was applied in relation to the the European Public Prosecutor, the Commission simply ignored the result.

During the Maastricht debates, we were told by the then Foreign Secretary that the Maastricht Treaty was the

“high water mark of federalism”.

That was patent nonsense, as has been demonstrated by so much of the Europhilic commentary that has poured out in a relentless tide of enthusiasm for European integration, and which has engulfed the United Kingdom and Europe as a whole, causing protests, riots and massive unemployment. It will drag Europe down, and will create the very instability that the project after 1945 was intended to avoid.

We need amendments to this Bill, relating to matters such as the purdah arrangements, the question of prohibiting European or governmental money, the question of the impartiality of the broadcasting authorities, the level of expenses, the timing and also, perhaps, the question in the referendum. According to recent opinion polls, trust among the European voters is at an all-time low, and that trust is what lies at the heart of the whole debate. In the words of Lord Randolph Churchill, we must trust the people.

[Several hon. Members]

rose—

--- Later in debate ---

[Damian Green]

Our Government are represented in the Council of Ministers and the Parliament; that is the democratic check. It can of course be improved—nobody is saying that the EU is perfect—but there are many institutions that need improving. Indeed, Parliament needs improving, but that does not mean we should give up on the many and manifold advantages of parliamentary democracy. That is the attitude with which we should approach the EU.

I am also in favour of the Bill because I am happy to take on in friendly public debate those who want to cut our close ties with friendly neighbouring democracies, and because I believe it is appropriate to have this debate now. The subject of Europe is a curious one in British politics. For a small number of people—some of whom have spoken today—it is an all-consuming passion. For the vast majority of the British people, however, it rarely features in the top 10 things they want Governments to get to grips with.

I will be happy to play a part in persuading the British people that the risks of turning our back on our democratic neighbours massively outweigh the benefits, but I will do this in the spirit of removing a cloud that has hung over politics for too long. Having the in/out debate always hovering around adds an unnecessary level of uncertainty to our national debate on many subjects, and it leaves the rest of the world, particularly our friends, unsure about Britain’s view of its own place in the world.

It has been clear for some time that we are going to need a referendum to clear up this uncertainty. It has been 40 years since the last one. The world has changed, the UK has changed, the European Union has changed. So let’s get on with it. Let us focus the British people’s minds on the choice before us, and see what they say.

[Sir William Cash]

rose—

[Damian Green]

I will, with some trepidation, give way to my hon. Friend.

[Sir William Cash]

I am glad my right hon. Friend has chosen to give way; my right hon. and learned Friend the Member for Rushcliffe (Mr Clarke) did not, so I am going to ask the same question. Does my right hon. Friend agree with the Prime Minister when he says that he wants not only reform but a fundamental change in our relationship with the EU?

[Damian Green]

I will talk about the change in the relationship in a few seconds, but first I want to turn to the Bill itself.

The Government are to be commended on passing the first and most important test in any referendum, which is that it asks a sensible and fair question. Asking whether we want to remain in the EU makes it clear that we are not starting with a blank sheet, but that we have an existing web of relationships, rules, and habits that would be put at risk by a no vote in the referendum.

Those who are most vocal in pointing this out are British businesses. They make the point that for the vast majority of our businesses the EU is not a straitjacket; it is a springboard to the opportunities provided by the global economy. This is as true for small businesses as it is for big ones.

The most recent CBI survey was interesting. It often says that eight out of 10 CBI members support our continued membership, and those who are against membership say it is just the voice of big business. However, if we drill down into that finding we discover that 77% of small and medium-sized businesses said that they support the UK’s continued membership of the EU. All of us on both sides of the House who recognise the importance of small businesses for prosperity, entrepreneurship and job creation should listen to their voices. People often complain that politicians do not listen.

--- Later in debate ---

[Mr Baker]

My hon. Friend knows my view about money and banking, which is that we should have market-based moneys. That is one of the things that has gone profoundly wrong. He prompts me to say, however, that we are very clearly, across the world, in the midst of a profound crisis of political economy, and that is what we must wrestle and cope with. Some of the old, simplistic and unpleasant arguments of the past must be put to rest. We need to rediscover a true liberalism, one in which people are accepting of one another.

[Sir William Cash]

Does my hon. Friend also accept that the eurozone is a de facto entity, whereas the question before us in this referendum is about being part of the European Union? The eurozone is a basket case, but at the same time it is dominated by one country which causes a lot of distortion to the way in which it works.

[Mr Baker]

Indeed. It is important that there is a degree of flexibility in currency systems, and Alan Greenspan’s wonderful book on gold and economic freedom is something I commend to everybody.

As the Minister knows, I have misgivings about some of the details in the Bill, which some of my colleagues have already fleshed out. But it is a happy occasion today, because our party is wholly united in supporting the principle of the Bill. It is long overdue. We are delighted that it has come forward and we look forward to its progress.

In due course the people will decide. On the one hand they have the choice of radicalism—political union across Europe. That is the radical choice. The moderate, conservative choice is trade and co-operation among friendly nation states. People in the end will choose either for the European Union, or for Britain.