European Union Referendum (Date of Referendum etc.) Regulations 2016

Baroness Smith of Newnham Excerpts

Wednesday 2nd March 2016 Lords Chamber

[Baroness Smith of Newnham (LD)]

My Lords, we on the Liberal Democrat Benches welcome the fact that the Prime Minister completed his renegotiation with a settlement on the UK’s membership of the European Union that enables him to campaign passionately, heart and soul, to keep the UK in the EU. We welcome that this is the position of Her Majesty’s Government, even if not of all thier Ministers—or of the former Ministers sitting in serried ranks directly opposite me.

I start by thanking the noble Baroness, Lady Anelay, for accepting amendments during the passage of the European Union Referendum Act to bring forward reports on the renegotiation such as the one under consideration today, The Best of Both Worlds. I believe this was the result of an amendment moved by the noble Lord, Lord Forsyth of Drumlean. I am very sorry that he appears to feel that it is propaganda and not the factual document he was looking for. Nevertheless, we are grateful that this document has come forward and, indeed, that the other reports that have come out, and are promised, on the consequences of withdrawal, the process of withdrawal under Article 50, and alternatives to membership in the possible event that the UK leaves the European Union.

The present report and the European Council conclusions of 19 February make clear that the United Kingdom already has a unique position within the European Union. We have a permanent opt-out from the euro and have remained outside the Schengen acquis. We are not part of the Schengen border controls and have flexibility on aspects of freedom, security and justice and of police and judicial co-operation. We are not signed up to every aspect of the European Union, even in the current circumstances.

However, the renegotiation goes further, creating a special relationship for the United Kingdom within the European Union which ensures that the UK will not be bound by the concept of ever-closer union—not something that I believe Liberal Democrats were too hung up on but an issue that seems to have affected many people concerned that European integration would go too far. That is now stopped. The renegotiation provides guarantees for the City of London thanks to a commitment to non-discrimination for non-eurozone members of the European Union and an emergency brake. Those who wish to leave the European Union would do well to consider whether it is realistic to imagine that the 27 would give us such a privileged position if we were on the outside—certainly, if we had simply decided that we no longer wanted to be part of the club and withdrew. The evidence suggests that they would not.

Of course, Her Majesty’s Government would seek to negotiate a new arrangement in the event of a vote to leave on 23 June, possibly running parallel with the Article 50 mechanism—I will not say “negotiation” because we do not get to negotiate, should the UK leave. However, it is hard to know what future negotiations might achieve. Seeking to exit is an unknown direction; nobody has tried it to date, and it is hard to see how any changes would benefit the United Kingdom. I do not wish to engage in Project Fear but it is unclear, for example, what would happen to EU nationals resident in the United Kingdom, or UK nationals such as the noble Lord, Lord Lawson, who we understand lives in France, should we vote to leave the European Union. I do not imagine that there would be an immediate move to repatriate UK nationals resident abroad, but perhaps we do not want to take that risk.

More seriously, a huge number of unknowns surround the sort of access that British citizens would have to employment and residency in the event of a vote to leave. It might be possible to negotiate rights for those already resident and/or working elsewhere in the European Union, or who have retired elsewhere in the European Union, but such access, if it is to be similar to the rights we enjoy today, would undoubtedly come with reciprocal rights. We would not simply be able to say that British nationals resident in other EU member states could remain but that, if we decided that we did not want EU nationals to be resident in the UK, we could somehow send them home, so we need to think about reciprocity.

Those who wish to leave are almost certainly correct that our erstwhile EU partners would not want to sever all ties. I do not believe for a moment that a vote to leave would simply mean that we were on the outside, completely separated. That is in the realms of fantasy on the negative side. However, it would be extraordinarily arrogant to assume that the UK is so important to the European Union that we would be accorded all the rights of full members once we decided to leave, but without any of the responsibilities. To suggest otherwise would be in the realms of deluded fantasy. After all, those states which have full access to the internal market via the European Economic Area are required to contribute to the EU budget, abide by the rules and yet do not have a seat at the table—“Pay, obey, no say”, as it was put in Brussels recently. So any attempt to keep the benefits of membership of the internal market would undoubtedly come at a price.

We would have less say than we have now but we would still be expected to contribute financially and we would still be bound by the four freedoms, including the freedoms we seem to like—the free movement of goods, capital and services—as well as the freedom we are a little ambivalent about: the free movement of people. The Prime Minister’s renegotiation has secured some limits on free movement, which will be triggered in the event of a vote to remain. A vote to leave would ensure that the European Union remained unreformed and it would surely be unwilling to make new, alternative special arrangements for the United Kingdom after any vote to walk away. By staying in the European Union we can exert influence; by leaving, we lose influence.

Of course, some Members of your Lordships’ House suggest that the European Union is not democratic—a point alluded to by the noble Baroness, Lady Morgan of Ely—and that somehow the European Parliament is lacking. I always find this a somewhat strange argument to make in your Lordships’ House, where most Members, with the exception of 90 hereditary Peers, are not here on a democratic mandate. But the European Union does have democratic processes and the United Kingdom, as a member, has a seat at the table. Indeed, we have many seats at the table—in the European Parliament, the Council of Ministers and the European Council—not to mention a European Commissioner, currently drawn, as was his predecessor, from your Lordships’ House. We play a full part in decision-making as a member of the Union.

There is no conceivable alternative arrangement to membership that would give us such influence—the Norwegians will tell you that. Yes, by leaving we could formally regain sovereignty but at the expense of power and influence—an “illusion of sovereignty”, as the Prime Minister has put it. Likewise, the idea of regaining control of our borders is nothing but a siren call. The UK is not currently part of the Schengen border regime; we still monitor our own borders. A vote to leave would not alter that. What it would do is make us less secure as we would be walking away from effective cross-border co-operation on policing, the European arrest warrant and the Schengen information system—areas of co-operation which show how the United Kingdom does indeed have the best of both worlds: access to EU structures where we want them, exemptions where we do not.

In conclusion, it is the view of the Liberal Democrat Benches that the UK is better off and more secure remaining in the European Union. It is good for the United Kingdom and good for peace and security in the European Union. We look forward to campaigning with the Prime Minister for a vote to remain.

[Lord Forsyth of Drumlean]

On the issue of influence in the EU—and I know the noble Baroness is very expert on European matters—could she confirm that in the past 20 years the UK has sought an amendment in the Council of Ministers on 72 occasions and been defeated on 72 occasions?

[Baroness Smith of Newnham]

My Lords, there are all sorts of statistics one can use. My understanding is, yes, where there have been formal votes the UK has been defeated. There are also many cases where there is a process of negotiation and votes are not held, where the UK is able to have influence. Working with our partners, we are able to stop legislation that we do not want. On the outside, a country such as Norway simply accepts anything that is put—or walks away from that part of the internal market. We have the opportunity to influence on the inside. On the outside, we lose even that.