Energy Prices

Debate between Chris Heaton-Harris and Michael Connarty

Wednesday 18th June 2014 Commons Chamber

[Chris Heaton-Harris]

I shall say something about fuel poverty later in my speech, but I believe that a huge majority of Northern Ireland fuel customers are off grid, and that solutions are currently being sought.

[Michael Connarty]

Will the hon. Gentleman give way?

[Chris Heaton-Harris]

I will take just one more intervention, from my good friend the hon. Member for Linlithgow and East Falkirk.

[Michael Connarty]

rose—

[Michael Connarty]

Nevertheless, the point that I am about to make is very relevant. The hon. Gentleman has been a Member of the European Parliament. The European Union has restricted roaming charges and other charges that have been used excessively by telecoms companies. It is saying that that does not work. Is that not exactly what the hon. Gentleman is attacking in the context of energy prices?

[Chris Heaton-Harris]

Indeed, and across Europe those very same telecoms companies are now coming to Governments saying they are not investing as much as they used to, because they have not got as much money as they would have had otherwise.

A direct effect of price ceilings is a shortage of supply. In an unhampered market, especially in energy where supply and demand are balanced by the free-functioning price mechanism, if the Government were to impose a price ceiling below the market price, as is proposed, the quantity of energy supply would fall as it would make less financial sense for companies to produce, while demand for energy would increase as a result of the lower prices. The result would be a shortage of energy, with consumers unable to find satisfactory supply.

In addition to the direct negative effects of price control, a series of indirect effects would emerge from the Government manipulation of prices proposed by the Opposition. While price controls do legally change the price, they cannot overcome the fundamental economic issue of deciding how to allocate scarce resources among an array of feasible alternatives. In the absence of the ability to use prices to ration scarce goods, alternative mechanisms emerge. Shortages, for example, would lead to long queues, as happened in the United States in the past because of gas prices, and backlogs, which tend to lead to subsequent Government interventions such as rationing schemes.

Most people understand that the controlling of energy prices, which has been tried before in the UK and elsewhere, has conclusively failed. For proof, we can look west, to California’s experience with price controls on retail energy, which led to shortages manifested in rolling power cuts throughout the state.

Even more importantly, price controls would discourage energy companies from making new, long-term investments, which is precisely what is needed to increase the supply of energy and improve standards of living. What this means is that, at best, the Opposition’s strategy might provide short-term benefits in the form of lower energy bills for a few, but with the associated cost of some form of deterioration in quality and quantity of supply in the immediate future. In the long run, prices would have to go up because the universal improvement in supply would fall away completely. The Opposition policy would have the exact opposite effect on prices from what they intend.

All economic knowledge and sense dictate that the Opposition idea is wrong-headed and misguided. If their goal is to improve standards of living, policy must focus, as it currently does, on incentivising and improving the quality and quantity of supply. Price controls serve to achieve the exact opposite, lowering the standard of living of many while providing political gains for few. The proposal must be dismissed as an uninformed fallacy.

However, we should not be surprised that the Leader of the Opposition and his party are focusing on a price freeze and the cost of living. The right hon. Gentleman is essentially just watching his own back, for it was he, in his previous guise of Secretary of State for Energy and Climate Change, who drove through policies that he knew would drive up prices for consumers and drive people into fuel poverty. He was happy for that to happen—there was no concern at all about a cost of living crisis. Indeed, back when he was Energy Secretary, the Labour leader gave the LSE Ralph Miliband lecture. On 19 November 2009, he explicitly confirmed that his policies would see energy bills rise:

“It needs a willingness to take the argument to people about the tough choices involved in tackling climate change. This is the starting point: a willingness to engage with people on, for example, the fact that to deal with the problem of climate change, energy bills are likely to rise.”

In January 2010, the Labour leader was even more candid:

“Yes, there are upward pressures on energy bills, and that makes life difficult for people, including those in fuel poverty; but it is right that we go down the low-carbon energy route.”

EU Police, Justice and Home Affairs

Debate between Chris Heaton-Harris and Michael Connarty

Wednesday 12th June 2013 Commons Chamber

[Chris Heaton-Harris (Daventry) (Con)]

It is a pleasure to speak in this welcome debate. We all know that the ability to invoke the block opt-out was negotiated as part of the Lisbon treaty—on which we did not have a vote—by the previous Labour Government. According to the refreshed Government list deposited in Parliament last month, 127 EU laws currently fall under the block opt-out. They are gradually being eaten away, so we will have fewer to debate by next May. They include the European arrest warrant, which has been mentioned and to which I will come in a moment, and legislation defining various criminal offences and rules for associated penalties. There are many measures—with 127 laws, that is to be expected—which is why it is important to have this sort of debate on the Floor of the House to enable the House to inform the Home Secretary and others on the Front Bench of its thinking. I therefore welcome the Opposition’s giving us the time to talk about this issue today.

Under the arrangements introduced by the Lisbon treaty, the UK has to opt out of all these EU laws en masse—it cannot opt out selectively. If the UK wants to opt out, it must notify the EU of its wish to do so by 31 May 2014 at the very latest, so we have plenty of time for this debate. If the UK does not opt out, under the EU treaties it will become bound by these laws indefinitely—there is no subsequent opportunity to opt out. Furthermore, from December 2014, the European Court of Justice will for the first time gain full jurisdiction over these laws under a change introduced by the Lisbon treaty, meaning that the European Commission could take the UK to the Court for what it believed to be a breach of one of these laws. Consequent rulings from the Court would be binding. In addition, the Court could rule on questions about the interpretation of these laws referred to it by UK courts—rulings that would then be applied by British judges.

Why is that an issue? It was raised by the House of Lords European Union Committee, and one particular case illustrates the great concern about the Court’s judicial activism: the Metock case in 2008. Four nationals of a non-EU state applied for asylum in Ireland, but their applications were rejected. In the meantime, however, the men had married women from other EU states, exercising free movement rights in Ireland, and they reapplied. The Irish Government refused each application, their regulations stating that the rights under the free movement directive did not apply to family members, unless they were already a lawful resident in another member state and seeking to enter Ireland with an EU national or to join an EU citizen in Ireland. The Grand Chamber of the European Court ruled that national legislation could not require the third country national spouse of an EEC citizen to have been a permanently lawful resident in another member state and therefore that they could benefit from the free movement directive. In other words, this highly controversial ruling rewrote EU law and Irish immigration law, so there is a reason to be concerned about the possibility of the Court’s being involved in such decisions.

If the UK invokes the opt-out, the European treaties allow our country to apply to opt back into particular EU laws covered by it. For most of these laws, a UK application to rejoin would be first considered by the European Commission, but if the Commission did not approve UK readmission, the Council of Ministers could decide, by qualified majority voting among member states bound by the relevant law, to admit the UK. For the remaining laws, which are considered part of the Schengen body of law, a UK application to rejoin is decided by unanimity in the Council, without formal Commission involvement. Opting back in is irreversible. If the UK is readmitted by the EU institutions, it could not opt out of the relevant laws again and the Court would have full jurisdiction over the laws concerned. That is why we have to tackle this sensibly and probably deal with each of the 127 measures in turn.

[Michael Connarty]

The hon. Gentleman and I are both members of the European Scrutiny Committee, but he has the advantage on me, in that he was a Member of the European Parliament, and he has obviously looked closely at what happens. It is always a deal, and the question of opting out of something permanently would be balanced by the fact that other countries might wish us to be in it for their advantage—even if we might think it to our disadvantage. In those situations, is it not likely that we would have to do deals and opt into things, such as what he has just illustrated, to get what we want on other things? Is it not time to talk about that sensibly in the European Scrutiny Committee and in the Lords Committee, instead of this smoke and mirrors? We do not have long between now and then to have those kinds of debate and to advise the Government about whether it would be advantageous to do the sorts of deals they might be faced with in the future.

[Chris Heaton-Harris]

I thank the hon. Gentleman for his point. He will know that a Home Office Minister gave evidence to our Committee when we talked about that. We were doing our job on that Committee and trying to prise out of the Government, quite legitimately, what the position would be. That is why I have no issue with this debate.

The Government have said that some of the EU laws subject to the block opt-out are obsolete, and I thought I would list some of them for the benefit of Opposition Members, because there are more than three of them. First, there is the joint action 96/747/JHA on the creation of the directory that the Home Secretary mentioned. There are various laws under the block opt-out that have little or nothing to do with cross-border co-operation. They include framework decision 2000/383/JHA, which defines the criminal offence of currency counterfeiting and sets rules and attendant penalties, and framework decision 2003/568/JHA on corruption in the private sector, which requires member states to criminalise intentionally

“requesting or receiving an undue advantage of any kind,”

and so on. These are not great big European deals or blockbusters; they are things that we can take or leave. Indeed, it is questionable whether they needed to be decided at the European level in the first place.

Numerous EU laws requiring member states to criminalise particular actions oblige them to punish such offences with

“effective, proportionate and dissuasive criminal penalties”—

an ambiguous phrase that is massively open to interpretation and causes some concern. If the UK deems it necessary to change its criminal law to facilitate cross-border co-operation, we are perfectly able to do so through our own democratic processes. We do not have to sign up to EU control to do so.

Other EU laws under the block opt-out purport to establish cross-border co-operation. In some cases, laws that sound as though they would be useful do not seem to be so in practice. For example, the Government have said that the UK has not sent any requests to other member states to freeze suspected criminal assets or evidence under framework decision 2003/577/JHA since it was adopted more than a decade ago. There are several laws under the block opt-out that the UK has so far declined to implement fully, sometimes on grounds of cost. They include Prüm decisions, as we heard earlier, which involve the police sharing information such as fingerprints and DNA—perhaps the precursor to a European Prism programme or something like that. In other cases, such as the European arrest warrant, the laws on cross-border co-operation do not have sufficient safeguards for the rights of British citizens. In too many cases, British people have been arrested in the UK under the European arrest warrant and extradited to other EU countries, where they have ended up suffering serious injustices owing to foreseeable problems with the domestic criminal justice systems in those countries.

There are a number of problems with the European arrest warrant, which have been highlighted by many other countries. The stats are quite simple. Nearly 1,000 requests for a European arrest warrant are issued each month. In 2009, the Serious Organised Crime Agency here in the UK received 4,004 requests for a European arrest warrant to be issued. To put that in context, between 2003 and 2009, the UK extradited 63 people to the United States, whereas in 2009-10, the UK extradited 699 individuals to the EU. Perhaps there is a problem with what the warrants are being issued for, which causes a great deal of concern out there in civil society. The fundamental problem for people such as me is the extension of powers to the European Court of Justice. Given our experience of this matter nationally and internationally, we should be wary about that extension.

Let me try to bust some of the myths about this issue. There is a myth that if we do not opt in, we will lose all co-operation with EU partners on crime and policing. By opting out en bloc, we avoid sacrificing UK democratic control over 127 crime and policing measures to the European Commission and European Court of Justice. We can opt back into those measures that serve the UK national interest. This is an opportunity to re-cast our relationship, so that it is based on practical law enforcement co-operation but is not part of the EU Commission’s drive towards a single EU criminal code, enforced by a European public prosecutor and the European Court of Justice. I can remember debates in the European Parliament nearly a decade ago in which a single European criminal code and a European public prosecutor were talked about very seriously.

Another myth is that the UK needs to give the European Commission and European Court of Justice the last word on UK crime and policing policy to strengthen public safety. One of the UK’s closest security relationship is with the United States, yet we do not give the FBI or the US Supreme Court supranational control over our policy making, so why should do the same we in this case? Another myth is that we could lose vital areas of co-operation such as data sharing on criminal records. That is rubbish. We have always co-operated on those matters.

European Union (Approvals) Bill

Debate between Chris Heaton-Harris and Michael Connarty

Monday 11th February 2013 Commons Chamber

[Michael Connarty]

I recall that well, because I have been a Member of the House since ’92, and I remember the very lengthy debates that took place, but this is not about the Maastricht treaty; it is about the proposal in the Bill, which is basically to set up a

“Multiannual Framework for the Fundamental Rights Agency”.

That is the point that is of interest to me, because that is an important thing to do and we should be going forward with it. I hope that we do. If the Government really are about to do an about-face and vote against that, I wonder what their position was in the Council, when this went through. Were they voted down in the Council? Are they about to change their position?

I am interested in the Government’s position as much as anyone else, but I am speaking from my point of view, looking at this as someone who has been on the Parliamentary Assembly of the Council of Europe and the European Scrutiny Committee for a long time. It is important, I believe, for us to realise that, while we might not like the fact that the EU sometimes asks us to do things that we might not have wished to do ourselves—for me, some of those are in fishing and agriculture, neither of which has been massively amended by anything that has happened recently under this Government—human rights will not be harmed in this country but will be advanced markedly in other countries by having the EU alongside the Council of Europe and the Court of Human Rights, fighting for human rights for all in Europe. Who would wish to deny that, apart from the hon. Member for Shipley?

[Chris Heaton-Harris]

Is there not a concern, though, about the duplication and growth of those agencies? Even the European Commission, through Commissioner Šefcovic, said at the end of last year that we need to reform many of these agencies, which have unruly-sized governing boards, and try to prevent conflicts of interest. Just in this particular field, we have the Fundamental Rights Agency based in Vienna, the European Institute for Gender Equality based in Vilnius, and the European Asylum Support Office based in Valetta. Surely the question is, should we be growing this agency and giving it such a big budget and a multi-annual financial framework of such a size before we have undertaken some reform of those agencies?

[Michael Connarty]

I take the point. It is well made by the hon. Gentleman, who speaks from the dual perspective of looking in from the European Union at the effect on other countries, and looking out now from this Parliament at what the European Union is doing.

I find it remarkable that every time the European Union grows, we have a convention that the new member state gets a new Commissioner. At my first meeting in Brussels, I believe I raised the matter with UKRep—why did we need a new Commissioner every time we added a country? Why does every member state have to have an office of some kind because it does not have an office of some other kind? We did it. We were fighting over the universal patent recently, and the most important thing to the UK was where the patent court would be based. It had to be based in London. It was not about whether the patent was a good or a bad thing. There is a problem with the EU in that it sprays benefits around. I believe it has put some institution on Crete—a wonderful island where I have holidayed often, but I could not work out why a major institution of the European Union had been located on Crete, apart from the fact that the Greeks wanted to have their turn.

That has to be looked at fundamentally, but the principle is correct. If the European Union sets up the agency, it will monitor what is happening with human rights, and I hope it will then begin to ask how it can help the Council of Europe, the European Court of Human Rights and those who want, as Churchill and many others did after the last war, to base Europe on human rights. The questions will continue about the corpus juris, which the hon. Member for Stone (Mr Cash) will no doubt talk about, and the right hon. Member for Wokingham (Mr Redwood) will no doubt talk about economic interference.

After all that is discussed, I hope we will all be able to agree that if the EU supports the Council of Europe and does the business, making human rights available to all the people in the EU and then beyond, it will advance Europe in accordance with the original principles of the people who set up the convention, which should be at the heart of our politics.

European Union Bill

Debate between Chris Heaton-Harris and Michael Connarty

Tuesday 8th March 2011 Commons Chamber

[Chris Heaton-Harris]

Well, they do have a say through the Government they elect, and the Government do negotiate these things in the multi-annual packages. As I said in a debate on a previous new clause, this is one way of making sure that if the Government decided it was practical for us to have a rise in the amount of money being spent in the European institutions, the people would have a say on how much it would be. I accept that own resources is covered in some ways in the Bill, but I thought I would phrase the new clause in such a way that it would give the Minister a chance to tell the House exactly what the British Government’s views are on matters of taxation coming in at the European level. My new clause would at least introduce the principle of referendums on own resources decisions bringing about substantial changes in EU taxation, and require future Governments to go through a more exacting process to agree to such changes, which would expend significant political capital if they were proposing something clearly out of line with what the British people want.

The new clauses address the crux of the debate, which is the scrutiny of European matters. We in this place do not do scrutiny half as well as we should. On Third Reading, I hope to speak about how we might improve scrutiny and what the Government should do.

[Michael Connarty]

I want to speak briefly in support of new clauses 3, 4 and 5. They get to the meat of the discussion we should have been having with the Government before they introduced this silly Bill. It is silly because it is never likely to be used, as there are so many ways that a Government Minister of any political complexion who wishes to continue with the European project can get measures through Parliament, such as by saying that they are insignificant or that it is not necessary to have an Act of Parliament. Therefore, I do not think that the Bill’s measures will be used a great deal. It is based on the premise that the Government want to put in place the measures they introduce, and presumably a Government of any complexion will know that they need a majority in the House in order to introduce any measure that they might decide is significant enough to be dealt with by a referendum or an Act of Parliament.

In reality, therefore, the Bill is a bit of a public relations exercise. But the new clauses are not. They would address the things that are wrong at the moment with the process of dealing with the emergency brake. It should be in place and it should be used properly in a way that gives a Government a chance to speak on behalf of their Parliament and their people in the Council in a fundamental way. New clauses 3 and 4 are very attractive, because would give teeth and meat—a bit of beef—to a Bill that lacks that completely. The Bill is a list of things which might be on the mind of the body politic and perhaps the anti-European press, but it does not have any substance. The new clauses have substance, as they lay out clearly how the brake should be used.

There is absolutely no doubt that new clause 5 is necessary. It deals with a tax and we should have had a similar clause, somewhere along the line, on the giving away of our social security rights. It is clear that people who come to this country to work see social security as an extra payment that does not come out of the pocket of their employer. When someone leaves their family back in Poland, where they still have their house, to come to this country to work, they get all the benefits required under our social security legislation—tax credits, child tax credits and so on—which they often send back home. They also often end up with a council house, because they then bring their family to this country and live in overcrowded conditions, and they leave their house back there being paid for by the British taxpayer. All those things might have been examined seriously if we had had a provision such as new clause 5 to deal with how social security would transfer.

Clearly the own resources arrangement is a tax and will be about creating a European tax as a substitute for VAT. I have been at conferences and seminars called by the Commission in other countries to press that point heavily, and thank goodness Treasury officials were there to argue hard against such an arrangement. We might say that it was one of the three red lines, because we said that tax was a red line that would not be crossed. However, the own resources debate will clearly be pressed again and again by the Commission, which will try to convince us that the proposed arrangement is not a breach of one of those red lines. New clause 5 would put up a nice barrier that we would have to cross purposefully and decisively if we wanted to move away from that red line. I commend the hon. Member for Daventry (Chris Heaton-Harris) for his tenacity, even at this late stage, in tabling well thought-out new clauses. I do not think that they come from a Eurosceptic, anti-European view; they would just be common sense and make good legislation.