European Union (Amendment) Act 2008

Denis MacShane Excerpts

Wednesday 16th March 2011 Commons Chamber

[Mrs Anne Main (St Albans) (Con)]

We have touched on whether or not the Minister thinks our membership of the EU is a good thing, but we should ask the people whether they believe we should be in Europe. That is a question which, I am sorry to say, he has not answered.

[Mr Denis MacShane (Rotherham) (Lab)]

The Prime Minister did.

[Mr Lidington]

The Prime Minister made it clear in answer to questions last week that he believes it is in the United Kingdom’s interest to remain part of Europe. One of the things that my hon. Friend the Member for St Albans (Mrs Main) needs to say, in the hypothetical choice she advocates, is what the United Kingdom should leave the European Union in order to join. I will not stray beyond the confines of the motion this evening; I merely pose that question to my hon. Friend.

I shall give way to my hon. Friend the Member for Gainsborough (Mr Leigh); then I will make progress and not give way for a while.

--- Later in debate ---

[Mr Denis MacShane (Rotherham) (Lab)]

I actually agree with some of what the hon. Member for Stone (Mr Cash) said: a lot of this does turn on Germany. We are told that the eurozone is a disaster zone, economically, but we can now see that Germany is succeeding rather well in the eurozone according to all the indices that matter: growth, falling unemployment and exports. I agree that Germany is playing its hand. I am worried about the German position on intervening in Libya, but that is the price we pay for—

[Martin Horwood]

Will the right hon. Gentleman give way?

[Mr MacShane]

Very briefly. I want to take up only two or three minutes.

[Martin Horwood]

I hope that, while endorsing the words of the hon. Member for Stone (Mr Cash), the right hon. Gentleman will dissociate himself from the hon. Gentleman’s use of the term “appeasement” in connection with Germany. It was profoundly distasteful and quite inappropriate to this debate.

[Mr MacShane]

I thought the hon. Member for Cheltenham (Martin Horwood) made an important intervention earlier this week about the Saudi invasion and occupation of Bahrain, but that is another point. I am sorry, but the hon. Member for Stone has put his finger on a very profound point, although I would not use the term “appeasement”.

I have affection for the Minister for Europe, who was like Horatio defending the bridge, fighting all by himself “for the ashes of his fathers and the temples of his Gods”, as the Tuscan hordes—the Eurosceptic hordes—bore down on him and tried to thrust him to one side in order to bring to bear their vision of what Britain should be like. This is a very serious development. The Government have used article 48(6) of the treaty of the European Union—the famous passerelle clause, which was not meant to be used.

We are agreed that part of the problem is connected with the budget freeze, about which the Minister spoke so passionately and proudly, but in exchange the President of France is going to get an absolute block on any common agricultural policy reform. Right hon. and hon. Members should have no illusions about that; if any part of Europe is frozen, it all tends to start freezing. In the agreed statement, although the new mechanism applies only to eurozone or euro-using members, it fully engages Britain. As the key statement we are debating tonight states:

“The Heads of State or Government of the euro area”—

that is not us—

“and the EU institutions have made it clear… that they stand ready to do whatever is required to ensure the stability of the euro area as a whole. The euro is and will remain a central part of European integration. In particular, the Heads called for determined action in the following areas”,

which were specified. The Heads of the European institutions speak for us. That means the President of the European Council. We appointed him, as we appointed the President of the European Parliament. Our MEPs elected him. I am afraid that this is not simply a matter solely and exclusively for the eurozone. Frankly, this might be a comfort blanket that my dear friend Horatio is trying to throw over the noisy bedsteads of the Tuscans behind him, but the fact is that this will commit Britain to take part in decisions that involve us as a nation.

When I said in a debate last week that the Prime Minister, after discussing the Libyan crisis on Friday, would be asked to leave the room, the hon. Member for Stone intervened, as some Members might remember, and read out a press release saying that the British Prime Minister would take part in these decisions on the architecture of economic governance of Europe as a whole. The hon. Member for Stone might care to recall that, last Friday, as soon as the Libyan discussions were over—they ended, frankly, in nothing, with bits of paper being waved around—the serious decisions of the European Council started and lasted all through Friday afternoon, Friday evening and Saturday. The Irish Prime Minister, the new one of the newly elected Government, went home, not achieving what the Irish people had voted for, but we were absent. This is what the Deputy Prime Minister rightly calls the “empty chair” policy of the present Government, which greatly worries me.

We will pass this legislation tonight, but I accept what the hon. Member for Stone said—this is a matter of high importance. I worry that we are slowly isolating ourselves from the main thrust of decision making in Europe. I think the Minister is putting up a firm defence. The Prime Minister, however, at Prime Minister’s Questions last week, dismissed the intervention of the hon. Member for Wellingborough (Mr Bone)—I do not mean that unkindly, as I thought it was one of the nicest interventions ever. The hon. Gentleman appealed to the Prime Minister for an in-or-out referendum, but the Prime Minister effectively said on behalf of the British nation state that we are not leaving and that we are not going to a have a referendum, as we are part of Europe.

[Mr Bone]

Will the right hon. Gentleman give way?

[Mr MacShane]

I have quoted the hon. Gentleman, so I suppose I should.

[Mr Bone]

I would like to correct the record. The Prime Minister gave his view on how he would vote in an in/out referendum, but he did not rule out either way whether we would have a referendum. He left that entirely open.

[Mr MacShane]

Yes, and I am going to win the lottery on Saturday! I think the Prime Minister was very clear that we are not going to have an in-or-out referendum and that we are staying in the EU. If we are to stay in the EU, it is better to work co-operatively and effectively in it. Unfortunately, the Government do not accept the consequences of their full membership of the EU. They are pretending—here we find that dear Horatio has been waving a wooden sword—that the measure before us somehow excludes Britain from future responsibilities. It does not; it will not: the European Union issue will go on and on for the rest of this Parliament.

--- Later in debate ---

[Steve Baker]

I am most grateful for that.

We have talked about political economy, and great matters are at stake. It seems to me that there have always been two visions for Europe: a classical liberal vision and a vision of a so-called social Europe—an interventionist Europe. A classical liberal Europe would enable free movement of people, services and goods, all of which are to be applauded because we know that human flourishing depends on free trade and peace. The big question is: when did Europe become a social Europe, a socialist Europe and an interventionist Europe? Is it right that we put our faith in the omnipotence of government to solve all our problems and to deliver stability and prosperity?

With this measure, the European Union becomes explicitly a transfer union and is explicitly moving money and wealth around from one member state to another, and I suspect that Germany has very nearly had enough of it. We should not persuade ourselves that this is an entirely new phenomenon. I was most grateful to my hon. Friend the Member for Stone for giving me the opportunity to write in his European journal with a colleague and friend of mine, Professor Philipp Bagus, a German economist at a Spanish university. We explained how the European Union is inherently a monetary transfer union. By monetising their debts, profligate countries have been able to appropriate for themselves wealth from the productive nations such as Germany. This has been going on in a way that very few people understand for a very long time, and I believe that it has substantially contributed to the crisis that we are in. Having lived with this principle of redistribution by subtle means for a long time, we now seem to be explicitly adopting the notion of fiscal transfer union and direct economic governance.

[Mr MacShane]

May I invite the hon. Gentleman to read the Hansard record from 1984 when Mrs Thatcher brought back the rebate? My right hon. Friend the Member for Blackburn (Mr Straw) said that she had hauled down the Union Jack and hauled up the white flag of surrender to Brussels. She replied that that was quite wrong, that it was right that we should transfer, and right that we aid Portugal and the poorer members of the EU. At times, I feel like a Thatcherite.

[Steve Baker]

I am grateful to the right hon. Gentleman for that, but the question is not whether we should help our friends in Europe, but how we should do so. Everybody here is interested in securing the maximum of human flourishing right across Europe—I do not doubt that—but the question is how to do that. Should it be done through the omnipotence of the state or through free trade, free markets and peace?

I believe in stability and prosperity for Europe, but I do not believe for one moment that the European Union is capable of delivering it. I finish by reading a quote from a great French liberal statesman. He said:

“The state is that great fiction by which everyone seeks to live at the expense of everyone else.”

If this measure goes through, Europe will indeed have adopted that idea and it will have done so very much to its disadvantage.