European Union (Finance) Bill

Debate between Alison McGovern and Graham Stuart

Thursday 11th June 2015 Commons Chamber

[Alison McGovern (Wirral South) (Lab)]

It is an absolute pleasure to speak for the first time under your chairship, Madam Deputy Speaker. I know that I will enjoy doing so and it is great to see you in your place.

This afternoon, we have heard no fewer than eight maiden speeches. All have been brilliant and eloquent, and each Member has given a great exposition of their constituency. It is no surprise that they should have been so brilliant, and let me say why. I say this to the hon. Members for East Lothian (George Kerevan), for Tonbridge and Malling (Tom Tugendhat), for South Ribble (Seema Kennedy), for Glenrothes (Peter Grant), for Corby (Tom Pursglove), for Richmond (Yorks) (Rishi Sunak) and for Bath (Ben Howlett), and my hon. Friend the Member for Ealing Central and Acton (Dr Huq): it is no surprise that each one of them has made a fantastic first speech in this House because they chose to make their first contribution in a debate on European affairs, as I did five years ago, so welcome to the club, folks! They all did absolutely brilliantly, especially my hon. Friend the Member for Ealing Central and Acton. It is good to see that we are welcoming another fellow DJ to this place. I know that she will add great things to our debates.

Several Members mentioned their diverse backgrounds, and how proud they were to represent their home towns. The hon. Member for Bath made that point particularly well. He said that Members in this House come from all parts of the world and have diverse family backgrounds. Our country is at its best when it appreciates its wide history and shows its tolerance, which is one of the finest of British values, and I support everything that he said on that point.

On the Bill at hand, this debate has highlighted many important issues, which will undoubtedly be discussed over the next few months as we continue to debate Europe. As my hon. Friend the Member for Worsley and Eccles South (Barbara Keeley) has already stated, we will not oppose this Bill.

The Bill, although short, will give effect to the new financing system of the European Union, which equates to a net contribution from the UK of £9.8 billion for the year 2015-16. We will seek to improve the Bill in a number of ways. First, we need to review the EU budget. At the moment, 6% of the EU budget is spent on administration costs, and we need to ascertain whether that money is being spent efficiently and effectively. If it is not, we need to consider what we can do to change it. We have a collective interest in ensuring that European resources are used efficiently. Indeed, there are so many areas in which we have a collective interest with our European friends and neighbours. We will seek agreement from the Council of Ministers to undertake a review of budget priorities, waste and inefficiency within the EU budget.

There also needs to be an improved process for agreeing the EU budget. My hon. Friend the Member for Worsley and Eccles South has already highlighted the convoluted process that we go through and some of the difficulties. To increase transparency and accountability, it is vital that this House expresses its opinion on the budget, and we should seek to meet budget representatives in advance of EU budget negotiations. I urge the Government to consider what more they can do on that front.

We also need to revisit how the budget is set and how we spend the money. To set a different ceiling on spending commitments and payments seems odd, and we ask for the process to be reviewed to ensure that the gap is manageable.

I am sure that Members would not feel too insulted if I suggested that the EU budget can be difficult to understand. It involves complicated decision-making processes. Set out over a seven-year cycle, it covers everything from spending on research and innovation to public health and even pensions for staff, but it is precisely because of its wide scope that it needs such careful attention.

We have heard Government Members wax lyrical about their achievements on reducing the UK’s contribution to Europe. Labour welcomes the fact that the UK has achieved that real-term cut in spending limits, and I remind the House that we played an important role in pushing for that cut.

We called for a real-term cut in spending in 2010, and pushed for a better deal for Britons in the following years, but a reduction in spending is just one part of the reforms that we need. The budget also needs to be more focused. We need to concentrate on areas that will enhance economic growth across the EU. I was struck by the comments made by my hon. Friend the Member for Worsley and Eccles South about the level of unemployment in parts of Europe. We need to improve productivity, support the creation of new jobs, and, ultimately, enhance living standards within our Union.

[Graham Stuart (Beverley and Holderness) (Con)]

The hon. Lady is being characteristically generous in paying tribute to the Prime Minister for securing that reduction in the budget. Given that the Labour party is now indulging in various changes of opinion, not least on Europe, does she recognise that the way so much was given away in the mid-2000s by the previous Labour Government was a great mistake, and will she pledge that no future Labour Government would ever do such a thing in that way?

[Alison McGovern]

I thank the hon. Gentleman for that intervention and for his kind words. Given the comment I just made about when I chose to make my first speech at this place, I can assure him that I have never changed my mind about Europe. I shall say more about that.

Spending on research, innovation, infrastructure, education and training, and enterprise development is very important and can help us better to promote the European Union as a facilitator of growth within the UK. Of course we recognise that we must also finance all aspects of the EU, but I would question whether continuing to spend so much of our money on areas like the common agricultural policy demonstrates the right priorities. It accounted for 40% of EU expenditure in 2013 yet contributed just over 1% to total EU economic output.

--- Later in debate ---

[Alison McGovern]

I have no fear of the views of the British people and I only endeavour to listen to them.

Seven out of ten of the UK’s largest export markets are in EU countries, amounting to 42% of the UK’s total exports or £122 billion every year. Some of those exports are made in my constituency, and I see the vital importance of the European market to the whole of the UK and to my constituents no less than to anyone else’s. Of all the investment spending in the UK over the past 20 years, 21% has come from foreign direct investment, and we should not underestimate the importance of that. We have access to 500 million customers in the single market, and in my role as shadow City Minister. I must raise the point that in my opinion the financial services sector benefits enormously from remaining within the EU.

[Graham Stuart]

rose—

[Alison McGovern]

I will give way, because I am feeling generous.

[Graham Stuart]

The hon. Lady is being very generous. A lot of the debate on this in the past has been a bit overdone, as though there would be no trade between the EU and the UK if we were to leave. What assessment has the hon. Lady made of what the impact would be? I am sure that there would be costs, but perhaps we need to avoid exaggerating or suggesting that somehow all trade would cease or that there would be massive walls put up when there will not. What is her assessment of the likely impact on trade if we did depart?

[Alison McGovern]

I am not always this generous, so the hon. Gentleman should perhaps make the most of it. I have looked my constituents in the eye, especially those who work at General Motors in Ellesmere Port, and I have seen in them a dedication to make things in this country to be sold abroad for the good of our economy. Their dedication in working so hard for our country deserves our commitment to ensuring that our borders are open to our biggest customers. When they sell their cars to Europe, that is good for our country and I think that my job is to stand by their side.

We must work hard to make the EU better for everybody, and the Bill presents us with an opportunity to do that. The multiannual financial framework has already been agreed by the European Council. We should use this process to strengthen budgetary procedures for the future and enhance political and public understanding of how the EU budget works, and we should re-prioritise how EU money is spent so that it works for the benefit of each and every person in Europe, not just for a wealthy few. I look forward to strengthening the Bill as it moves through the House.