European Union Bill

David Lidington Excerpts

Monday 11th July 2011 Commons Chamber

[The Minister for Europe (Mr David Lidington)]

I beg to move, That this House agrees with Lords amendment 1.

[Mr Speaker]

With this it will be convenient to take Lords amendments 2 and 4.

[Mr Lidington]

Since the Bill was given its Third Reading just four months ago, it has been considered carefully and assiduously by the other place, as Members in all parts of the House would expect. I pay tribute to the House of Lords for the diligent way in which it examined the Bill. The Government might not always have shared the views of colleagues in the other place, and we will deal with the points of disagreement in more detail during the debate, but it only right for us to note and welcome the careful, meticulous analysis conducted there.

The House of Lords has agreed to 15 amendments that it now falls to us to consider. They cover a number of issues, and I am sure that Members in all parts of the House will want to spend some time considering each of them, so I shall try to make good progress with each group.

[Kelvin Hopkins (Luton North) (Lab)]

Having read the Lords amendments fairly carefully over an hour or so, I have the impression that they are all essentially about weakening a Bill that was not very strong in the first place. Could we not shorten the debate and vote on them fairly quickly?

[Mr Lidington]

I welcome what I take to be the hon. Gentleman’s support for a reversal of some of the Lords amendments and a restoration of the Bill to the state that it was in when it left this House. However, I am in his hands and those of other Members in terms of the time that it will take to deal with the amendments. I feel that we should do justice to the consideration that the House of Lords devoted to the Bill by dealing in turn with the amendments for which it voted.

[Mr William Cash (Stone) (Con)]

If I may quote the hallowed words of, I believe, John Bright, we should perhaps

“Be just, and fear not”.

Will the Minister be kind enough to confirm that he will do everything possible to ensure that the amendments relating to clause 18, to which the European Scrutiny Committee gave such careful consideration and on which it produced such a comprehensive report, will be reached so that we can at least discuss those questions emphatically? They are extremely important, and will allow us to discuss the Supreme Court and its potential interpretation of laws that might inhibit the supremacy of this House.

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[Mr Lidington]

I certainly do not intend to delay our reaching a group of amendments in which I know my hon. Friend is particularly interested. However, as I said to the hon. Member for Luton North (Kelvin Hopkins), I am in the hands of the House in terms of how long it will take us to debate the two groups of amendments that Mr Speaker has placed before the group relating to clause 18.

The first three amendments were proposed by my right hon. and noble Friend Lord Howell of Guildford on behalf of the Government. They are essentially technical, and were intended to deal with concern that was expressed in the House of Lords about the interpretation of some of the provisions in part 1. They fall into two categories.

Lords amendment 1 changes one of the definitions in clause 1 involving the phrase “or otherwise supporting”. The fear was expressed in the House of Lords that the Bill, as originally drafted, could inadvertently prevent Ministers and their officials from taking part constructively in negotiations about new proposals for action. That is not, and has never been, the Government’s intention. Our intention is that the United Kingdom should continue to be an active player in the European Union, engaging with our partners and ensuring that the EU delivers what it ought to be delivering for the benefit of our citizens and those of other European countries.

Under the Bill, the Government would not be able to vote in favour of, or otherwise support, a treaty or other provision specified in part 1 when the time came for the final decision to be made in the European Council or in the Council of the European Union without the necessary approvals. The words “or otherwise supporting” are included simply because—as many Members who follow European affairs closely will know—it is possible for a proposal that is subject to unanimity to be adopted even it has not been agreed to by each member state in a formal vote. For example, a formal vote does not always take place. In certain circumstances where the Chair believes that he or she has the mood of the room, silence can be taken as assent and, when a decision requires unanimity, abstention is, effectively, counted as a supportive vote, as set out in articles 235(1) and 238(4) of the treaty on the functioning of the European Union.

[Mr Cash]

Having listened with enthusiasm and interest to my right hon. Friend’s earlier remarks about timing, on the basis that I think it is generally conceded that this particular batch of amendments is entirely uncontroversial and that the whole question of the amendments’ content could be dealt with in about 30 seconds flat, will he be kind enough to address them as swiftly as possible, to ensure that the House can get its views across on all matters?

[Mr Lidington]

I am encouraged by my hon. Friend’s remarks to be increasingly confident that we can reach the group of amendments on which he is anxious to speak in good time. I remind him, however, that four hours have been set aside for our deliberations on these three groups of amendments, and I think it is right that we should do justice to the consideration that the House of Lords gave to the Bill by addressing each of the amendments it approved.

On Lords amendment 1, all I want to say further is that the phrase “or otherwise supporting” is included to remove any doubt—just as the previous Government used that phrase to remove any doubt when drafting the European Union (Amendment) Act 2008—and to ensure that a proposal could not be adopted in such a way without the appropriate authority required under the provisions of the Bill.

Lords amendments 2 and 4 make it clear beyond doubt that, under the terms of the Bill, a referendum would not be required in the United Kingdom if a treaty change did not apply to the UK but only to Gibraltar, and this would not transfer competence or power from the United Kingdom. I say straight away that it is hard to work out a scenario in which a treaty amendment that constituted a transfer of competence or power would apply only to Gibraltar and not to the UK. It is possible in theory, and this point was raised in the other place, and we have sought to assuage that concern by proposing these two technical amendments.

[Henry Smith (Crawley) (Con)]

Notwithstanding the recent comments of my hon. Friend the Member for Stone (Mr Cash) on the need for brevity, let me say that while I agree that this is a technical tidying up of the clause as it left this place, I am concerned that a future Foreign and Commonwealth Office—not the current one—that wished to stitch up the good and loyal people of Gibraltar should not have that opportunity through the back door of the European Union.

[Mr Lidington]

I can certainly assure my hon. Friend that the current Government are absolutely committed to Gibraltar remaining British for as long as the people of Gibraltar want that to continue. We have made that clear publicly since the day we took office, and I have repeated it in public both in this country and on a visit to Gibraltar a few months ago.

[Mr Ian Davidson (Glasgow South West) (Lab/Co-op)]

Given that this proposal refers specifically to Gibraltar, has the Minister sought and obtained the views of the Government of Gibraltar, and are they supportive of it?

[Mr Lidington]

Yes, we have done so. The original provision before its amendment by the House of Lords was approved by the Chief Minister of Gibraltar, whom we consulted before originally publishing the Bill, and we have consulted the Government of Gibraltar about the additional change in this Lords amendment and they are content with it. They do not think it in any way damages their position.

I hope the House will agree to these Lords amendments.

Lords amendments 1 and 2 agreed to.

Clause 2

Treaties amending or replacing TEU or TFEU

[Mr Lidington]

I beg to move, That this House disagrees with Lords amendment 3.

[Mr Deputy Speaker (Mr Nigel Evans)]

With this it will be convenient to discuss the following:

Lords amendments 5 to 13 and 15.

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[Mr Lidington]

I ask the House not to support the Lords in these amendments. I am afraid that I am going to have to test the patience of my hon. Friend the Member for Stone (Mr Cash) a little on this group, because these Lords amendments were passed against the Government’s wishes and, in our view, significantly weaken the Bill’s safeguards.

The amendments would restrict the scope or operation of the referendum lock that was approved by this House. They are contrary to our clear intention to ensure that any future proposal to amend the European Union treaties to transfer further competence or power from this country to the European Union should be subject to the consent of the British people. The purpose of the Bill is to reconnect with the people whom we serve. It aims to re-engage them with key decisions on the direction of the European Union, on which they have, in the past, been denied their say. The amendments would not deliver on those aims but, on the contrary, make it much more difficult to achieve them.

[Mr Cash]

Will my right hon. Friend join me in deploring what recent events have demonstrated? Does he, thus, agree that it would have been extremely desirable to ensure that a referendum should apply to any treaty, either current or future, which attempted to change the fundamental relationship of the United Kingdom to the European Union, including in respect of the creation of a two-tier Europe—between the eurozone and the EU—in economic governance? Does he agree that that is a matter on which a referendum is every bit as important? This is not merely a question of a transfer of competence and powers but one that goes to the very heart of the constitutional relationship between the UK and the EU.

[Mr Lidington]

If, as I hope, this Bill obtains Royal Assent and goes on to the statute book, this Government and future Governments will, from the moment its powers are commenced, be bound by the provisions of this legislation with regard to the way in which they handle any future proposal to amend the European Union treaties, negotiate and agree a completely new treaty or invoke one of the passerelle clauses in the treaty of Lisbon. As my hon. Friend knows, in certain cases a Government would have to hold a referendum before a particular treaty could be ratified by this country. For any treaty change, even one that according to the provisions of this Bill would not automatically require a referendum, an Act of Parliament—primary legislation—would be needed, and it would of course be open to Parliament at that time to decide to go further even than the provisions that we are putting forward in this legislation.

[Mr Cash]

May I say that I am delighted by that delightfully disingenuous response? As my right hon. Friend knows perfectly well, I am referring to the treaty that has already been made, and I immediately realised what he was up to when he talked about “any future” treaty. I accept that an Act of Parliament may be needed, but does he not, by the same token as the principles that he has set out in great detail, also agree that we should have a referendum on the creation of such a two-tier Europe, which creates constitutional change in the relationship between the EU and ourselves?

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[Mr Lidington]

The principle on which the Government have consistently sought to act in preparing and introducing this legislation has been that a change to the treaties that transferred new competencies or powers from the United Kingdom to the institutions of the European Union would require the agreement of the British people in a referendum. That is the principle, so for us the test for the sort of hypothetical treaty change that my hon. Friend is describing would be whether it transferred competencies or powers from this country to the EU. I do not want to stray too far from the subject of the Lords amendments we are discussing, but the hypothesis that he describes could just as well be a question of a quite separate intergovernmental treaty between members of the eurozone, for example, as an amendment to the treaty of Lisbon, which would require the assent of the United Kingdom.

[Mr Cash]

Let me have one last shot. Does the Minister concede that there is a world of difference between the members of the coalition Government having entered into an agreement between themselves for purposes that suit them and the constitutional convention that a referendum is required when there is a fundamental constitutional change in the relationship between us and the European Union? It is as simple as that.

[Mr Lidington]

We sought in this Bill to define a constitutional change of the sort that my hon. Friend describes in terms of a transfer of competencies or powers from the United Kingdom to the European Union. That seems to us to be a significant constitutional change and the definition is one that we have incorporated into the Bill. Now, if he will forgive me, never mind how delightful I find his interventions, I think I ought to make some progress in addressing the Lords amendments directly.

Let me deal first with Lords amendments 3 and 5, which one might term the threshold amendments. They would provide for a turnout threshold of 40% for any referendum under the Bill. If that threshold were not met, regardless of the result the final decision over whether to ratify a treaty change would pass from the people back to Parliament. That runs contrary to the spirit and intention of the Bill and would leave the British people in real doubt about the effect of their vote.

I know that the intention of colleagues in the House of Lords was to safeguard the sovereignty of Parliament, but I do not agree with them that the Bill would challenge the status of Parliament. In fact, Parliament will have a much stronger role than ever before.

[Henry Smith]

I am grateful to my right hon. Friend for being so courteous in giving way. Does he agree that, ironically, elections to the European Parliament often have a turnout of 40% or less, as do many local authority elections? Would it not be absurd to consider those as merely advisory?

[Mr Lidington]

My hon. Friend is right. We get into very dangerous territory as elected representatives when we start to say that only votes or elections in which the turnout was above a given percentage are valid. What is at issue is our intention to provide for the British electorate to have the final say on whether or not the Government of the day can agree to transfer competencies or powers from the United Kingdom to the European Union. The outcome of a referendum should, in our view, be determined by the will of those who vote and not by how many turn up to vote.

As the hon. Member for Foyle (Mark Durkan) said earlier this year when we debated a turnout threshold for the referendum on the alternative vote:

“If we agree to anything that passes for any sort of threshold, people in this country will have an incentive to say, ‘If you don’t know, don’t vote’”.—[Official Report, 15 February 2011; Vol. 523, c. 907.]

A turnout threshold seems to me to be a recipe for apathy. It would undermine one of the fundamental aims of the Bill, which is to reconnect the British people and better inform them of the decisions taken in their name at European Union level.

[Mr Charles Kennedy (Ross, Skye and Lochaber) (LD)]

The argument that the Minister is very fairly advancing is reinforced by what the Electoral Commission said in advance of today’s proceedings. Its task and statutory duty in issuing a certificate following an election has to be based on a proper definition of the size of the electorate and what constitutes turnout. Does the Minister agree that the amendments add no clarity whatever to that?

[Mr Lidington]

My right hon. Friend is absolutely correct about the views of the Electoral Commission, which I believe it expressed publicly in its response to the amendments passed in the other place. There could be some perverse, although unintended, I am sure, effects if the threshold amendments were upheld. In some circumstances, there would be an incentive for one side in the referendum campaign to urge abstention rather than support in an effort to keep turnout below the magic threshold of 40%. It could also mean some very peculiar outcomes. Obviously we are talking hypothetically, but if we stuck with the 40% threshold, a poll would be deemed invalid if there was a turnout of 39% in which 5% voted one way and 34% voted the other, whereas a poll with a turnout of 41%, with 21% voting one way and 20% voting the other—the 1% margin—

[Mr Denis MacShane (Rotherham) (Lab)]

That is not 100%.

[Mr Lidington]

I assumed that I did not need to translate the figures for the right hon. Gentleman and I am sure that he understands my argument perfectly well. There could be a very small difference between the two sides in a referendum result, but it would be valid if the turnout was just above the 40% threshold, whereas a much bigger and more decisive outcome just below the 40% would be deemed to be of no account.

[Kelvin Hopkins]

In very extreme circumstances, there could be a result of 39% to zero with the zeros winning.

[Mr Lidington]

I think the hon. Gentleman is being hypothetical and I am sure that some voters would be cussed enough to insist on going to the polls whatever the odds against them but his point is a reasonable one.

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[Mr Deputy Speaker (Mr Nigel Evans)]

Order. I am not trying to bury my unsuccessful past.

[Mr Lidington]

In 1979, I was still a university student and had other things on my mind than the devolution referendums in Scotland and Wales. If one takes the right hon. Gentleman’s point about the imposition of the threshold then and looks back at the history of the decade after, which resulted in no move towards satisfying what were genuine aspirations for a greater degree of devolved government in Scotland and Wales, it made the public disconnection from Westminster of the people in those two countries greater over the subsequent years. But this is a matter that historians can argue over.

[Mr Davidson]

Can I clarify what the Minister is saying? Is he saying that the 40% rule would apply not only to referendums in this context but to any future referendum and that the Government would be committed to opposing any 40% threshold for any future independence referendum in Scotland?

[Mr Lidington]

I am not going to speculate on a hypothetical Scottish referendum. We have said clearly not just on this Bill but on the Bill that authorised the referendum on the alternative vote system that we felt the decision should be taken by those people who voted, and the outcome should not depend on any artificial threshold that we chose to impose.

[Mr Cash]

My right hon. Friend may recall that it was my amendment that led to the question of the threshold in the AV Bill. Does he accept that something profoundly different went on in the 1970s regarding Scottish devolution, because it was a different formula? On this particular issue, however, there is no doubt that the same kind of spontaneous combustion would occur in relation to any referendum on the European issue, fortunately, and the same kinds of figures would prevail as were registered in parts of Staffordshire—80% against the Government’s proposals to enter into a treaty that was unacceptable to the United Kingdom. There is nothing that anyone can do about it. Tests, thresholds and all the rest of it would be swept away.

[Mr Lidington]

I am confident that if and when a British Government made a proposal to support a treaty change to give extra powers to the European Union and put that to the people, the turnout would be significantly above 40%. I have confidence in the voters.

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

I thank the Minister for giving way; he is being generous with his time. Does he agree that thresholds are just bliss for the lazy politician? If politicians are not sure that they are going to win and want those on the other side to prove their point, they can sit at home and do nothing. If we extended the threshold to local elections or European elections, as my hon. Friend the Member for Crawley (Henry Smith) suggested, I would not have been elected on the 23% turnout that was achieved in the east midlands in 1999. More votes were cast that very weekend to evict Bubble from the second “Big Brother” house.

[Mr Lidington]

My hon. Friend puts his point well. There have been parliamentary by-elections where the total turnout was less than 40%, and I do not think anybody argued at that moment that the election of that Member was in any way invalid.

[Mark Reckless (Rochester and Strood) (Con)]

My right hon. Friend presumed earlier that the Lords had inserted the amendments to protect parliamentary sovereignty. Is it not possible that some noble Lords voted to insert the amendments because, in the circumstances outlined by the hon. Member for Luton North (Kelvin Hopkins), if 39% of people vote against something to do with the EU and 0% in favour, they would prefer it if the 0% won? In this context, is my right hon. Friend aware that some noble Lords are in receipt of EU pensions? Would it not have been better if that financial interest had been declared?

[Mr Lidington]

My hon. Friend has put matters on the record. I am content to take the arguments and reasons given by Members of the House of Lords as justification for the amendments in which they believed.

[Ian Swales (Redcar) (LD)]

Does the Minister agree that if we accept the amendment, we are setting up a perverse incentive for the Government of the day to seek a low turnout if they wish to get a measure through? That might affect the way they publicise a referendum or engage with the process.

[Mr Lidington]

That puts it fairly. The perverse incentive to seek an apathetic reaction from the electorate is one that I would want to avoid.

[Mr Davidson]

rose—

[Mr Lidington]

I will give way one last time, because I want to deal with the other Lords amendments in the group.

[Mr Davidson]

I am grateful to the Minister for giving way in the circumstances. Surely the hon. Member for Rochester and Strood (Mark Reckless) is wrong and we cannot have a situation where Members of the House of Lords who are in receipt of money from Brussels vote and do not declare it. Surely that would be counter to everything in our parliamentary democracy and surely they give an indication that they are in receipt of gold from Brussels.

[Mr Lidington]

One thing that I have learned in my 19 years in this place is that each House is very jealous of its own procedures and privileges, including what the rules should be on the declaration of financial interest, so I think we should leave that to the House of Lords authorities to decide.

I am surprised that the threshold amendment was supported in the House of Lords by the official Opposition Front-Bench team. I hope that when the hon. Member for Caerphilly (Mr David) catches the Deputy Speaker’s eye, he will provide some explanation of that course of action and indicate whether he plans to lead his party through the Lobby in defence of a 40% threshold, although he has probably given up hope of leading the hon. Member for Luton North.

That support is particularly astonishing because the hon. Member for Caerphilly is seriously at odds with his, and my, immediate and distinguished predecessor. It was the hon. Member for Rhondda (Chris Bryant), who was Labour’s spokesman on Europe, who said repeatedly in debates on 2 November last year that he disagreed fundamentally with the very idea of thresholds, saying:

“I do not agree . . . about thresholds in referendums because, broadly, they are not a good idea.”—[Official Report, 2 November 2010; Vol. 517, c. 846.]

He repeated that a few columns later. As a Conservative politician, I feel slightly nervous trespassing on the frontier between Caerphilly and the Rhondda, but the hon. Member for Caerphilly owes the House an explanation for this departure in Labour party policy that he has presumably devised and implemented.

Amendments 6 to 13 are very significant indeed in their impact. They would remove from the referendum lock several passerelle decisions that would transfer power and competence from Britain to the European Union. The other place accepted that decisions to adopt the euro, give up UK border controls, or create a single, integrated military force should require a referendum. That was a welcome step, but it is not enough. The coalition agreement set out clearly that

“no further powers should be transferred to Brussels without a referendum.”

All the decisions included in clause 6 as it left the House of Commons would constitute such a transfer.

Some Members of the Lords felt the original clause 6 did not provide Ministers with what they termed sufficient “pragmatic flexibility”. I would say in response that it is a direct consequence of the abuse of so-called “pragmatic flexibility” in the past that there is such lack of trust in the European Union today, and in Governments as a species, for decisions taken on European Union matters. It is that lack of trust which the Bill seeks to address. Speaking as someone who disagrees with some of my hon. Friends on the Back Benches, I want to see the United Kingdom playing a vigorous, active, constructive role on behalf of our people within the European Union. Our ability to do that and to enjoy the confidence of the British people in so doing will be enhanced if we can point to the safeguards that are provided for in the Bill included in clause 6.

[Mr Cash]

On that important point, is my right hon. Friend aware of the remarks of the Prime Minister as reported in The Spectator only a few days ago on the question of the renegotiation of the existing treaties, which I called on the Prime Minister to do when he came back from the last European Council summit? Does the Minister for Europe know that I tabled a written question to the Prime Minister asking him what objectives he has set to maximise what he wants from the UK’s engagement with Europe, and whether such objectives will include any opportunity to renegotiate the UK’s relationship with the EU? As the Minister must know, the answer that I received today says that the Prime Minister is not going to answer that question, I am afraid, and that he has transferred it to the Secretary of State for Foreign and Commonwealth Affairs. Does the Minister have an answer for me, therefore, to the question that seems to have been transferred to him?

[Mr Lidington]

Providing the formal response to my hon. Friend’s question is clearly a treat that is yet in store for me. I will obviously give him a proper and considered response when the question reaches me, but everything I have observed about how my right hon. Friend the Prime Minister has acted in respect of the European Union since the general election has shown his utter determination to maximise the interests of the United Kingdom and the British people in every negotiation at European level in which he has taken part. Everything that he, the Deputy Prime Minister and other members of the Government do, from conversations with colleagues to meetings of the Council of Ministers, is about trying to get the best possible advantage for the United Kingdom from our membership of the EU.

[Mark Reckless]

In that case, although Ministers had such great success in preventing the use of the EU-wide financial stability mechanism in the case of the Greek bail-out, will the Minister explain why it was simply nodded through with respect to Portugal?

[Mr Lidington]

I think that I would test the House’s patience if I were to go into that in detail, particularly as there was a debate on bail-outs a few weeks ago, in which I think my hon. Friend participated, and to which my hon. Friend the Financial Secretary to the Treasury responded at some length. I am sure that there will be other opportunities to question Treasury Ministers about that.

[Mr Deputy Speaker (Mr Nigel Evans)]

Order. For the convenience of the House, I remind Members that just because the debate has the word “Europe” in the title, that does not mean that we can have a wide-ranging debate on European issues. Some latitude has been given, as Mr Cash knows, but could we now please look at the specific amendments?

[Mr Lidington]

The amendments to clause 6 would introduce huge inconsistency in the referendum lock. They would make the method used to transfer competence or power the determining factor in deciding whether or not a referendum should be held, rather than the fact of the transfer of competence or power itself. There are four ways of amending the treaties to allow transfers of power and competence from the United Kingdom to the European Union. First, there is the ordinary treaty revision procedure. Secondly, there is the first part of the simplified revision procedure, which was the method used recently to agree the recent treaty change on the eurozone stability mechanism. Thirdly, the British veto could be given up using the second part of the simplified revision procedure set out in article 48(7) of the treaty on European Union. The fourth and final way is through the use of a decision or passerelle without formal treaty change.

The Lords amendments seek to remove the last two methods from the referendum lock. I do not see the logic in this. For example, the amendments would mean that were a future UK Government to decide to give up their veto over foreign and security policy under the ordinary treaty revision procedure, there would first have to be a referendum, but if they decided to give up that veto under the passerelle decision in article 31(3), which would have exactly the same effect as a change under the ordinary revision procedure, there would be no requirement for a referendum. I do not think that the British public would understand being able to vote on a treaty change that gave up the veto but not having a say over a passerelle that did exactly the same thing, and there are other such examples. As my right hon. and noble Friend Lord Howell argued, this would be tantamount to locking the front and back doors of a house but leaving the kitchen window open. It is not the way to restore the trust of the British people.

The amendments would also draw an artificial distinction between a possible future agreement on a common European defence that would involve the creation of a single, integrated military force and other similar decisions that would not. The amendment suggests that the only controversial element would be a decision to develop a “single, integrated military force”, but there would inevitably be confusion over the extent to which such a force would be established. For example, would the establishment of an integrated command structure, an integrated unit or integrated budgets count? That lack of clarity could allow each step to be presented as “not quite” leading to a single integrated military force, and therefore “not quite” justifying a referendum. It is important that we hold to the principle that were a British Government to decide to opt in to a common European defence, that should ultimately be subject to a decision by the British people. A common defence could undermine the pre-eminence or capability of NATO, notwithstanding any assurances provided in the EU treaties. Maintaining that pre-eminence has been a long-standing concern of this and previous British Governments.

[Mr Bernard Jenkin (Harwich and North Essex) (Con)]

My right hon. Friend is making an able demolition of these unacceptable amendments, but will he describe what sorts of decisions on common defence he thinks would currently trigger a referendum, because it is difficult to see how such decisions would constitute a transfer of power under the rather narrow definition set out in the Bill?

[Mr Lidington]

As the House debated in Committee and on Report, in the Bill it is the creation of a common European defence entity that goes beyond what is defined as a common security and defence policy, which as my hon. Friend knows is very limited in scope within the treaties as they stand. If there was to be a common European defence, that would clearly have to be defined in treaty terms, but sometimes, as he would be the first to note, language that appears quite generalised in scope, once written into a treaty, provides the basis on which numerous detailed measures can then be brought forward because there has been an overall extension of competence to the EU institutions. It could—I am not saying that it always would—spell the end of an independent UK defence policy, which was one of the previous Government’s red lines during their negotiations on the Lisbon treaty.

The amendments would also remove any decision to participate in a European public prosecutor from the referendum requirement. Hon. Members will recall the sensitivity and divergence in views across Europe over the idea of a European public prosecutor who would be able to launch prosecutions in the United Kingdom and other member states in areas affecting the EU’s financial interests. When we considered this issue earlier this year it was accepted that people should be asked for their approval before any Government could agree to participate and allow cases to be prosecuted independently in the UK’s legal system.

We have always guarded jealously—rightly, I think—the principle that decisions on whether to prosecute any individual or corporate entity should be taken by the designated independent prosecutors. To give those powers to some new European body that could come in and state whether a prosecution would or would not take place, irrespective of what the Crown Prosecution Service, the Director of Public Prosecutions or Her Majesty’s Revenue and Customs said about a particular case, would be a very serious shift of power and competence away from this country to Brussels. It would be right for the British people to be asked to assent to that before a Government were allowed to ratify such a decision.

Before I move on from the Lords amendments to clause 6, I should like to express my amazement that, when the House of Lords voted for an amendment to remove from the referendum lock a decision to end the requirement for unanimity in agreement to the EU’s multi-annual financial frameworks, the official Opposition voted in favour of that proposal. I hope that the hon. Member for Caerphilly will explain on the record where the Opposition now stand on the matter. Everyone in the House, whatever their views on the EU, knows that in the next couple of years a key issue facing every Government in the EU and all the Brussels institutions is the negotiation on the new MFF which will effectively set budgetary decisions and ceilings for the next five or seven years in the EU’s life and development. It is vital that that remains subject to unanimity and that the British Government, whoever is in office, continue to have a right of veto.

[Mr Wayne David (Caerphilly) (Lab)]

indicated assent.

[Mr Lidington]

The hon. Gentleman is nodding, so he must explain why members of his party—not just Labour Back Benchers but official spokesmen in the House of Lords—trooped through the Lobby to say that they wanted to scrap the British veto and allow the fate, for example, of the UK’s rebate to be subject not to consensus but to qualified majority voting. That would be the impact of the measure. The hon. Gentleman is saying that he would remove from the referendum lock a decision to switch from unanimity to QMV on that matter.

[Mr Cash]

Does my right hon. Friend agree that perhaps it has something to do with the report on the question of economic governance, in which it appeared as if the underlying theme expressed by certain Opposition Members in the House of Lords was edging us towards the prospect of fiscal union? There really is a substantial difference in policy, principle and philosophy, if I can use that expression, in their attitude to the EU and that of the House of Commons.

[Mr Lidington]

My hon. Friend makes a good point. The Opposition need to own up to where they are coming from. If the hon. Member for Caerphilly wants to intervene and say that his Front-Bench colleagues in the House of Lords had gone rogue and he was unable to control them, that he was sorry and he did not really mean it, a plea for forgiveness might be entertained. But if he really supports the proposal to remove decisions on the MFF from the referendum lock, he should say so clearly to the House, because the Labour party did not say that when the Bill was debated in the House of Commons.

[Mr David]

I will make a deal with the Minister. I am more than happy to explain the Labour party’s decision when I speak to the Lords amendments, but will he explain to the House the comments of Members of the other place such as Lord Brittan, or the actions of Lord Heseltine, both of whom expressed complete disagreement with fundamental aspects of the Bill?

[Mr Lidington]

I have huge respect for Lord Brittan, Lord Heseltine and those senior Liberal Democrats in the House of Lords who have devoted their political lives to support for European integration—they have a consistent and honourable point of view on this. I do not agree with them. There is a key difference—and the hon. Gentleman may wish to challenge me—between the way in which Lords Brittan and Heseltine spoke and voted and the way in which his colleagues did so. My noble Friends gave distinguished service in government, but many years ago, and they are no longer ministerial spokesmen. The hon. Gentleman must explain why the Labour party’s official spokesmen in the House of Lords spoke and voted in the Lobby for an amendment that he appears very unwilling to support.

--- Later in debate ---

[Madam Deputy Speaker (Dawn Primarolo)]

Order. It has been interesting to hear hon. Members discuss their opinions of the careers of distinguished Members of the House of Lords, but I should like the Minister to return to the business before the House, which is Lords amendment 3, and his views on that, rather than on anyone in the House of Lords.

[Mr Lidington]

I will try to avoid that temptation, Madam Deputy Speaker.

[Chris Heaton-Harris]

To help out the Opposition, the Minister may have noticed that they had a completely different policy on the MFF on days that began with a “T” from on those that began with any other letter. That happens to be true when it comes to the Lords.

[Madam Deputy Speaker]

I do not want the Minister to help out the Opposition, who can take care of themselves. I want him to help out the Government by speaking to the amendment. Perhaps he would return to it.

[Mr Lidington]

I shall turn to Lords amendment 15, which would insert a sunset clause into the Bill, so that part 1 and schedule 1 would expire when Parliament is dissolved, only to be revived at the discretion of the Secretary of State and with the approval of Parliament for the duration of the new Parliament. That exercise would have to be repeated every five years. I have looked carefully at the arguments for such a measure. As the Government made clear in the other place, sunset clauses can be useful in legislation proposing new or extraordinary powers for the Executive, or in legislation that would serve a specific or time-limited purpose, but this Bill does neither.

Some colleagues in the House of Lords said that the Bill was a constitutional innovation and should therefore be subject to a sunset clause, but much of what we do in Parliament is innovative. We believe that the Bill is an innovation that will be welcomed by the British people, and it should become an enduring part of our constitutional framework.

[Kelvin Hopkins]

I agree entirely, and I think that the British people would like the Bill to be rather stronger.

[Mr Lidington]

I think that the British people would be alarmed at the thought that they were being offered new rights and responsibilities for a term of only five years, and would then have to wait and see whether they would be graciously renewed by a new Parliament.

In a survey conducted two years ago, more than four out of every five British people wanted a referendum on any future treaty change. Everything that we do in the House is reversible—no single Parliament can bind its successor—so there is no reason to single the Bill out for a sunset clause, which would mean that it merely loaned power to the people of this country on the future direction of the EU for a limited time. After that, the decision on whether or not to lend them the power for another five years would be in the hands of the Government of the day. The British people would rightly look on such a proposition with disdain.

[Henry Smith]

My right hon. Friend is entirely right. If the amendment were allowed to stand, would it not render the proposed legislation completely empty? As he eloquently said, it goes against the constitutional principle that no Parliament can bind its successor.

[Mr Lidington]

My hon. Friend is quite right. In a previous Parliament, when we voted for constitutional legislation as far-reaching as the devolution of power to the Scottish Parliament and the Assemblies in Wales and Northern Ireland, we did not vote for the inclusion of sunset clauses. Parliament took the view that if that legislation, in due course, proved not to be workable, or if there were a profound change in the public mood or a new Government were elected with a mandate from the people to effect changes and reverse that devolution, that was a matter for the future Parliament at that time. The idea that we should impose a sunset clause in this case simply because it is something new seems to be completely inconsistent with the way in which Parliament and successive Governments have approached previous constitutional reforms.

[Mr Cash]

I am interested in the line that my right hon. Friend is taking. Without pre-empting any other discussion, does he agree that this is also about the whole question of our membership of the European Union being only on loan from this House because under the Factortame decision Lord Bridge made it clear that it was a voluntary act and no more? Does he therefore think that inserting a reference to the European Communities Act 1972, as proposed in the amendment tabled by the former Lord Chancellor, Lord Mackay of Clashfern, would be making a profound mistake in thinking that this all hinges on the Act when in fact it depends on Parliament itself?

[Mr Lidington]

My hon. Friend is inviting me to comment on the subject matter of the third group of amendments. I hope that he will forgive me if I delay commenting in that fashion until we reach those amendments.

This Bill places Parliament at the heart of every decision to be considered. Each decision will need parliamentary approval, whether by Act or by resolution. The sunset clause would take that power away from Parliament, and until such time as part 1 was revived, none of the controls in part 1—not just the referendum lock but none of them—would apply. Some colleagues in the other place claim that the Government are binding future Governments and not themselves. However, we have already said that we will use the Bill to ratify the current treaty change on the eurozone stability mechanism, and we will also use it to consider the treaty change required for Croatia’s accession. Once the legislation is enacted, this Government, too, will be bound by it.

There is another reason why a sunset clause is unnecessary. The previous Government set up a system of post-legislative scrutiny under which the Government of the day are required to publish a memorandum to Parliament on the operation of each Act of Parliament up to five years after the commencement of that Act. This is examined by relevant parliamentary Committees, which can decide whether to conduct a detailed examination of that legislation. I am happy to put on record that we think that this is a good idea and that a future Government must publish a full report on how this Bill has been used within five years of its becoming law. That will result in the clarity and the reflection that colleagues in the other place seek, but without arbitrarily depriving the British people of their say.

The case for this Bill is simple: it is to give the British people the chance to have their rightful say over future changes to the EU treaties, whether through formal revision or use of the passerelles that transfer competence or power from this country to the EU. The Bill does not substitute the British people for Parliament, for Parliament will continue to have a central and strengthened role in approving such key decisions, but it provides a vital opportunity to address the disconnection that has developed over the years between the British people and the decisions taken in their name by Parliament and Government. This group of Lords amendments would not help us to achieve these goals—indeed, they would seriously jeopardise our chances of doing so—and that is why I hope that this House will disagree with them.

[Mr David]

I would like to comment briefly on Lords amendments 3 and 5 regarding the 40% threshold and on Lords amendments 6 to 13 regarding the number of referendums. I will then focus on Lords amendment 15 regarding the so-called sunset-sunrise clause.

Some people in both Houses say that a reasonable turnout in referendums is necessary to ensure a demonstrable degree of legitimacy. That argument was advanced during the alternative vote referendum debate, but it has weaknesses. We have already heard that there is a certain perverse incentive to encourage a lower turnout than might usually be the case, and that is a fair point. It is important to remember that there has been a threshold of 40% on only one occasion—the devolution referendums for Wales and Scotland in 1979. Wales rejected the then Government’s devolution proposals by a majority of four to one, while in Scotland there was a turnout of less than 40% but a narrow majority in favour of the proposals. The result in Scotland brought this question to the fore: when is a win not a win? That is a real dilemma, and it is one of the reasons that many Labour Members have reservations about the use of the 40% threshold.

Reference was made to my hon. Friend the Member for Rhondda (Chris Bryant). I should point out that Rhondda is in south Wales and Ronda, as it was pronounced by the Minister for Europe, is in Spain. My hon. Friend tells me that, although he speaks Spanish, he represents to the best of his ability the constituency in south Wales.

Amendments 6 to 13 would reduce the number of theoretically possible topics for referendums from more than 50 to three: the single currency, the creation of a single EU integrated military force, and border controls and the Schengen protocols. As Labour Members argued consistently on Second Reading and in Committee, there is an overwhelming argument for referendums to be held if ever a British Government wanted this country to join the single currency, which is extremely unlikely, and when there is a proposal for a major constitutional change. In Committee, we proposed an amendment for a Joint Committee of both Houses to examine whether a proposed treaty change was a significant constitutional change. Unfortunately, that proposal was not successful in this House, and nor did it gain sufficient support in the other place. However, that remains our position. Of course, Members in the other place are entitled to their views, but we have reservations about the proposal that referendums should be confined to these three subject areas, and it is important to put on the record that my comments set out the Labour party’s position.

That brings me to the sunset-sunrise clause. In the other place, Lord Kerr, the distinguished former head of the diplomatic service, put forward three arguments for such a clause, one of which related to foreign policy. He argued with conviction that were the provision enacted, other European Governments could freeze Britain out of the debate through enhanced co-operation or by acting outside the treaties altogether. That might happen, he said, when a British negotiator in Brussels is unable to agree to something

“because his Government back home will tell him, ‘Don’t be silly. That would trigger a referendum.’”—[Official Report, House of Lords, 15 June 2011; Vol. 728, c. 810.]

He argued that a regular assessment and decision at the start of a new Parliament on whether such a system was working would be a reasonable measure to adopt. That is worthy of consideration.

--- Later in debate ---

[Mr Cash]

They are, and it is for that reason that I will not be able to vote for them, even though I happen to have some sympathy for the idea of a reasonable test for referendums. However, these amendments are a blind—an attempt to get people to go along with the 40% test for the electorate on the one hand, but also to associate them with a whole range of matters that are entirely inimical to the interests of the United Kingdom. I am not particularly interested in the list that the Government have produced; as I said at the beginning of the proceedings on this Bill, I think that it is a mouse of a Bill. The issue on which we now need to concentrate is the big landscape and the fact that, as the European Council on Foreign Relations paper argued the other day, Maastricht has to be revised. We will have to return to the question of what kind of Europe we want.

This list of proposed matters—which will never come up in this Parliament, as we know—is, therefore, a blind in its own way, but to reduce it to three core issues really makes it an absurdity. I say to my right hon. Friend the Minister that on the big landscape, this is the time for us to take a bigger, more responsible and more statesmanlike view, in the interests of the people of this country, to see the European question as the failure that it is and to get down to the serious business of renegotiating all the treaties and moving to an association of nation states, so that we can work together co-operatively, rather than by co-ordination, to deal with the real, practical problems that this country faces—the Brazils, Indias and Chinas of this world—instead of dancing on the head of a pin, as we are with most of this Bill.

My argument to my right hon. Friend is very simple. He may have the advantage of having come forward with a few proposals that touch at the margins of this issue, but the real question is what is he—or, indeed, the Prime Minister—going to do to get us out of the mess that those treaties have got not only us but the people in Europe into? Indeed, young people aged between 18 and 25 in several countries are now suffering unemployment of 47%. It is absolutely impossible to accept that, and as I said in the 1990s, when this whole system collapses, it would not surprise me to see the rise of the far right and massive unemployment, destabilising the entire European Union, with the most devastating consequences for the international order. That is the problem that we are faced with, and that is why these amendments are not to be accepted.

Lords amendment 3 disagreed to.

Lords amendment 4 agreed to.

Lords amendments 5 to 13 disagreed to.

Clause 18

Status of EU law dependent on continuing statutory basis

[Mr Lidington]

I beg to move Government amendment (a) to Lords amendment 14.

[Madam Deputy Speaker (Dawn Primarolo)]

With this it will be convenient to discuss Government amendment (b).

[Mr Lidington]

I should like first to recognise that the issue we are debating is, to an extent, an issue of detail that has aroused some fairly intensive debate, involving some extremely experienced and high-powered lawyers. It is not an issue related to the rationale for clause 18 as a whole, and I welcome the acceptance by the House of Lords of the rationale for a provision of this nature. Indeed, the author of Lords amendment 14, Lord Mackay of Clashfern, said when he presented his amendment on Report in the other place that there was very little between his position and that of the Government on the point of principle, saying:

“It is important that this declaratory measure”—

that is, clause 18—

“should be made because of the theory sometimes propounded that Community law in the United Kingdom derives from the treaty alone by virtue of the European Union legal order. I believe that it is right that we should make it plain at this juncture that that is not so.”—[Official Report, House of Lords, 15 June 2011; Vol. 728, c. 790.]

However, noble Lords who voted in support of Lords amendment 14 took the view that the European Communities Act 1972 is the only route by which EU law takes effect in the United Kingdom, and that all the references to directly effective or applicable EU law in other Acts are linked to that Act. Lords amendment 14 therefore amends clause 18 to refer specifically to the European Communities Act 1972, rather than to the wider reference point of “an Act of Parliament”, in order to affirm that this is the sole route by which directly effective and directly applicable EU law takes effect in the UK.

[Mr Cash]

I rather suspect that my right hon. Friend expected that I would rise at about this point. Very quickly, the European Communities Act 1972 might be the Act of Parliament by virtue of which we voluntarily entered into the acceptance of European law—as it has accumulated, like a tsunami, since 1972, both widening and deepening—but does he not agree that the crucial words are those of Lord Bridge in the Factortame case, who said that we voluntarily did that? Therefore, the special significance of the 1972 Act has to be tempered by the fact that it was what Parliament decided at that time. That is the crucial question to which we shall turn shortly.

[Mr Lidington]

I agree with my hon. Friend, and I am sure he will recall the debate on these matters on Second Reading and particularly on the first day in Committee when we spent an entire day debating clause 18. He will also recall—it is clear from Hansard—that I made it clear on behalf of the Government that the European Communities Act 1972 had effect in this country, so European law had effect here insofar as it stemmed from that piece of legislation, because Parliament had willed that that should be the case. If a future Parliament were to decide to repeal that Act, it would be perfectly within that Parliament’s power so to do, although my hon. Friend would be the first to appreciate that there would be immediate consequences for the UK’s treaty obligations. There would be a political crisis at that point. We debated that important issue of principle for a day in Committee, as I said, but I want to try to focus on the Lords amendments now.

[Mr Cash]

Indeed. That is precisely why my right hon. Friend knows I must move on to ask him about the assertions of certain members of the Supreme Court—criticised by the late Lord Bingham in severe terms—to the effect that Parliament has only a qualified sovereignty and that the ultimate authority effectively rests with them. It is precisely for that reason that we should be extremely anxious to ensure that no words are imported into this clause, as the Bill leaves this House and will finally be enacted, that would in any way allow the Supreme Court to move in on that territory and claim ultimate authority.

[Mr Lidington]

rose—

[Madam Deputy Speaker (Dawn Primarolo)]

Order. I have been generous to the hon. Member for Stone (Mr Cash) as the Chairman of the European Scrutiny Committee, but his interventions are getting very long. I realise that these are important points, but he is always able to catch my eye if he wants to expand on them.

[Mr Lidington]

I make two points to my hon. Friend. First, the only reason the Supreme Court has power to adjudicate here on European Union matters is because Parliament has provided for directly effective and directly applicable EU law to have effect in the United Kingdom legal order by virtue of passing statutes that give European law that direct effect and application here. Secondly, as I think my hon. Friend knows—he is being a bit mischievous—he is trying to tempt me again on to a much broader issue, which is the important philosophical question of whether ultimate legislative supremacy lies with Parliament or whether parliamentary sovereignty is a construct of the common law controlled by judges. Speaking as an elected parliamentarian, I am quite clear and argue quite naturally that Parliament as the elected limb of body politic must have the ultimate say, but in making that case we are entering into a philosophical debate that goes way beyond the parameters of the European Union Bill, let alone Lords amendment 14.

Let me return to the Lords amendment. I am mindful of the arguments advanced by Lord Mackay of Clashfern and his supporters in the House of Lords, and I greatly appreciate their legal expertise. We considered Lord Mackay’s arguments very carefully both before the debate in the other place and following the Lords acceptance of the amendment. I sought further legal advice on this point, and the Government’s view remains that although the European Communities Act 1972 is indeed the principal means by which directly effective or directly applicable EU law takes effect in the UK, a number of other Acts of Parliament also give effect to EU law independently of the 1972 Act. For example, provisions of the Scotland Act 1998, of the Government of Wales Act 2006 and of the Northern Ireland Act 1998 put Ministers from the devolved Administrations under an obligation to act in accordance with EU law. Some of those settlements define EU obligations in a manner similar to the language used in section 2(1) of the 1972 Act—but, significantly, they do so not by reference to that Act.

The Government are therefore concerned that, were this House to agree with the Lords amendment as it stands, it could create the risk that the courts interpret this clause as restricting the ability of legislation other than the 1972 Act to incorporate directly applicable or directly effective EU law into UK law. That, in turn, could ultimately mean that clause 18 could be interpreted as being more than declaratory, which would rather undermine what we are trying to do with this Bill. This would not, in our view, reflect the law accurately, and so we seek to disagree with the Lords amendment as currently framed.

In that sense, I agree entirely with the arguments put forward by my hon. Friends the Members for Stone (Mr Cash) and for Aldridge-Brownhills (Mr Shepherd), but I also recognise Lord Mackay’s point that the 1972 Act is the primary conduit for directly effective and directly applicable EU law to take effect in the United Kingdom. In recognition of this concern, the Government propose a change of wording to the Lords amendment that would retain the reference to the European Communities Act 1972 but, importantly, also refer to the existence of other Acts of Parliament that also give effect to EU law.

[Mr David]

I understand the right hon. Gentleman’s point and I have sympathy with his argument. Crucial to the argument, it seems to me, are the words

“by virtue of an Act of Parliament”.

What is the difference between putting those words at the end rather than at the start of the clause, where they were initially?

[Mr Lidington]

I decided to include the words on the basis of the best legal advice available to me across Government at the time. When preparing the Bill for introduction into this House, I examined the wording and the question of whether a reference to the 1972 Act alone would be appropriate. I was given very clear legal advice that, because of the other statutes that make reference to the application of EU law, a simple reference to the 1972 legislation would not suffice. That explains the original wording of the Bill that came before the House of Commons.

What we have sought to do in framing our amendments to the Lords amendment is to recognise the view that the other place took that clause 18 should incorporate language that recognises the particular importance of the 1972 legislation. We see no reason why we should not amend the clause to make a specific reference to the 1972 Act so long as the clause also makes reference to those other Acts that give effect to EU law. This reflects the Government’s consistent position that other Acts of Parliament— independently of the European Communities Act 1972—might also allow for the incorporation of directly effective and directly applicable EU law into the UK legal order.

[Mr Jenkin]

I still do not understand what was wrong with the Government’s original drafting.

[Mr Lidington]

We believe that the original drafting met the tests that we had set to implement our policy of having a declaratory clause. What we are trying to do is to express through Government amendments the point made in the House of Lords that the 1972 legislation is of particular importance, while preserving the point of principle that we believe was incorporated in the original language as debated by the House of Commons.

[Mr David]

rose—

[Mr Lidington]

I want to make some progress.

It is not only the devolution legislation that mentions European Union law. The Company Directors Disqualification Act 1986, the Chiropractors Act 1994 and the Competition Act 1998 are further examples of legislation that allows European Union law to have direct effect in this country. Section 9A of the Company Directors Disqualification Act requires the United Kingdom to make a disqualification order against a person in certain circumstances, including circumstances in which an undertaking commits a breach of competition law under either article 81 or article 82 of the EC treaty—now articles 101 and 102 of the treaty on the functioning of the European Union. That Act refers directly to the treaty provisions without referring to the 1972 Act.

The amendment accepted by the other place removed the reference that makes it explicit that only by virtue of such Acts does directly effective and directly applicable EU law take effect in this country. Removing that reference leaves open the possibility of arguments that directly effective and directly applicable EU law could enter our law by other means, thus undermining the rationale behind the clause. The amendments that the Government propose seek to restore that important qualification, and to remove any doubt about whether directly effective or applicable EU law could enter United Kingdom law by other means.

[Mr Cash]

Will my hon. Friend give way?

[Mr Lidington]

We welcome the acceptance in the House of Lords of the principle of clause 18, and recognise the concerns raised by colleagues there about the formulation of the clause. We believe that our amendments will both meet the concerns expressed by the proposers of the amendment and ensure that the provision reflects the law accurately. I therefore urge Members in all parts of the House to support them.

[Mr Cash]

I am sorry that the Minister deemed it unnecessary, or undesirable, to accept my intervention, but that does not prevent me from making my point.

As the Minister will recall, it was the clear view of the European Scrutiny Committee that clause 18 was unnecessary. I am glad to say that a conversation in which I engaged today with one of my—let us call him—long-standing contestants in matters European, Lord Howe of Aberavon, confirmed that he shared our view. I have great respect for his legal knowledge, and I am delighted that we have achieved such a degree of understanding.

The Government are embarking on what is, in matters constitutional, an extremely dangerous path to tread: a primrose path that could lead to disaster. I know that there was a great deal of detailed discussion—I hear of these things—with Lord Mackay of Clashfern, who, after all, used to be Lord Chancellor, and indeed was Lord Chancellor at the time of the Maastricht treaty. I remember well, as I am sure he does, that the whole business of European government was conceded, to our deep regret; hence the rebellion which I had the pleasure to lead.

The Government appear to have been caught on the horns of a dilemma, and I think that they should have dealt with that in a different way. On one hand they are confronted with the European Scrutiny Committee, the expert legal advice that it has received, the further consideration that it has given to these questions throughout the intervening period, and its conclusion that clause 18 is unnecessary and undesirable. On the other hand—the other horn of the dilemma—is the view of Lord Mackay of Clashfern that the amendment is merely declaratory.

--- Later in debate ---

If there is to be a clause 18, for the reasons that I have outlined, the version that went to the Lords from the Commons should be preferred to the Lords amendment in the name of Lord Mackay of Clashfern. As I proposed in the amendment to Government amendment (b), the words “Act of Parliament” are to be preferred to “the European Communities Act 1972”. The Government’s amendment addresses these issues, but it would be much better not to state the principle at all; the amendment fails to deal with the trap that has been set. I know Lord Mackay of Clashfern to be a distinguished and canny Scots lawyer, and he understands exactly what he intends. He has, by the most clever sleight of hand, reinserted into the provision—[Interruption.] I see the Minister shaking his head and I shall give way to him.

[Mr Lidington]

I respect my hon. Friend’s expertise in this area, but to suggest that Lord Mackay of Clashfern would be party to any kind of sleight of hand is not to do him justice, and I hope that my hon. Friend would reconsider that point.

[Mr Cash]

I have no problem in acknowledging someone’s powerful views on constitutional questions. For example, I remember during the Maastricht proceedings that the noble Lord was quite clear on the question of whether the Maastricht treaty took us further and deeper into the integration process. He argued that it did not make any difference in principle because the 1972 Act already conceded that there had been a change in the constitutional position and, to all intents and purposes, there was, thus, no real change in the substance of the issue. That is not to accuse anybody; it is merely to recognise that they have a constitutional viewpoint and to recognise how they really regard the encroachments on our sovereignty, which were evident in the Jackson case, in the evidence that the Committee received from many distinguished witnesses and in the fact that the Government’s previous explanatory notes led us into a situation where we criticised the Government and they withdrew the offensive words, precisely for the reasons that I am presenting.

The reality is that we have caught out the Government on their wording and they have now acquiesced in other wording which opens the door to statutory interpretation by the Supreme Court. That is the kernel of this matter. Whether or not my right hon. Friend the Minister really likes the way in which I have expressed this is neither here nor there. The real question, on which I challenge him, is this: does he deny that the wording in the Government’s amendment, in response to the Lords amendment, imports the opportunity for the Supreme Court to apply statutory interpretation and, thereby, to create a situation that could be best avoided, as set out by Lord Howe of Aberavon, our European Scrutiny Committee and the evidence that we received from so many people, by having no clause at all, rather than the current clause 18?

The Minister knows that I feel very strongly about the fact that we promised in our manifesto a sovereignty Act, and that was the consequence of discussions at the very highest level with the leadership. We knew that that was put into the manifesto as a direct response to the promises that were made. The bottom line is that we were given a second-rate provision that is unnecessary and that has since been criticised by the European Scrutiny Committee and eminent constitutional experts, including Lord Howe of Aberavon, and what the Government are introducing merely acquiesces to a degree in what Lord Mackay of Clashfern has proposed. That simply is not good enough and the Government should withdraw the proposed clause while they have the opportunity to do so. It is for those reasons that I shall be voting against it.

--- Later in debate ---

[Mr Lidington]

I am grateful to the hon. Member for Caerphilly (Mr David) and my hon. Friends the Members for Stone (Mr Cash) and for Harwich and North Essex (Mr Jenkin) for their participation in the debate and I shall be brief in my response. I want to deal with the point of principle as well as the important point of detail about the interaction between this clause, the Government amendment and the Interpretation Act 1978.

[Mr David]

Before the Minister goes on, may I cast his mind back to the trenchant criticism from the European Scrutiny Committee about the explanatory notes that accompanied the Bill and, in particular, those on clause 18? I seem to recall the Minister giving the House a commitment that the explanatory notes would be examined and, if necessary, redrafted. Has that redrafting occurred and will there be further redrafting in the context of his amendment tonight?

[Mr Lidington]

The explanatory notes were changed when they were reprinted before the Bill was introduced in the House of Lords, just as I gave the House an undertaking that they would be. We amended the notes to make it clear that the references to common law in the relevant section were meant in contradistinction to statute law and that we were not commenting, as a Government and in either the Bill or the notes, on the important but much broader philosophical debate about the origins of parliamentary sovereignty.

Let me deal first with the point of general principle to which my hon. Friend the Member for Stone, in particular, referred. It has always been the Government’s position that clause 18 is declaratory of the existing state of our law in making it clear that European Union law has direct effect and application in this country for one reason and one reason only: namely, Parliament has given it that effect through primary legislation. I differ from my hon. Friend in that I continue to believe that it is valuable for us to have this declaratory clause on the statute book to serve as a clear expression of Parliament’s will and as an abiding point of reference for the courts if they are invited in future to consider again the sort of arguments that have previously been brought before them, most notably by the prosecution in the metric martyrs case, to the effect that European law has acquired over time an autonomous authority of its own that does not derive from Acts of Parliament.

[Steve Baker]

May I say how grateful I am that my right hon. Friend has given this clear statement of the Government’s and Parliament’s intent? We appear to have disappeared into such esoterica that even for one who takes a close interest in the clause it is almost impossible to understand the debate. Will the Minister confirm that should judges need to rule on this clause, they will be able to refer to Hansard to be absolutely clear what Parliament’s intent was?

[Mr Lidington]

Judges will of course look first at statute but it is also the case, following the Pepper v. Hart judgment, that if the courts are in any way uncertain about the meaning of a piece of legislation, they can look at what the Minister of the day said on behalf of the Government, as recorded in Hansard, as an aid to interpretation.

[Mr Cash]

That may well be but as the Minister rightly says it will be the Minister’s view that is taken into account by the court and the Whips will make darn certain this evening that we lose this vote. That is the problem and that is one reason why I take such exception to this.

[Mr Lidington]

My hon. Friend has made his point. Not only Lord Mackay but the Lords Constitution Committee recognised that clause 18 is a reflection of the existing position in United Kingdom law. I do not want to get into a long argument with my hon. Friend the Member for Stone about the report of the European Scrutiny Committee, but that report focused largely on the bigger question of whether parliamentary sovereignty was a common-law principle. I repeat to the House what I said during Committee—that this clause does not get into that issue at all. It makes clear the basis on which European law takes effect in our domestic legal order.

Let me address the detailed point that has been put. Both my hon. Friends the Members for Stone and for Harwich and North Essex argued that the reference to the 1972 Act taken together with the Interpretation Act meant there was a risk of future amendments to the 1972 Act falling outside the scope of clause 18. This point was specifically considered in the drafting of the Government’s amendments to the Lords amendment. That is exactly why the Government’s amendments, especially amendment (b), do not limit the clause to the 1972 Act but also take account of all Acts that might give rise to directly applicable and enforceable EU law, which will include any Acts amending the 1972 Act. I hope that with that reassurance colleagues on both sides of the House will be able to endorse the Government’s amendments.

Amendment (a) made to Lords amendment 14.

Amendment (b) proposed to Lords amendment 14.— (Mr Lidington.)

Question put, That the amendment be made.