National Referendum on the European Union

Douglas Alexander Excerpts

Monday 24th October 2011 Commons Chamber

[Mr Douglas Alexander (Paisley and Renfrewshire South) (Lab)]

It is a pleasure, as always, to speak after the Foreign Secretary. This debate takes place at a time of great peril and uncertainty for the British and European economies. I am sorry that the Prime Minister and Deputy Prime Minister, for whatever reason, have felt unable to join us in the Chamber for the debate, which has already revealed, no matter what the result in the Division Lobbies this evening, the scale of division on the Government Benches.

I urge opposition to the motion because I do not believe that Britain’s national interest would be served by spending the coming months and years debating the case for Britain leaving the world’s largest single market. Recent figures have revealed that there has been zero growth in the economy since last autumn. Unemployment is rising again and has reached a 17-year high. Almost 1 million young people are unable to find work. Amid all the passion generated by this debate, no one can dispute the enduring significance of European markets to Britain’s economic prospects.

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

Will the right hon. Gentleman give way?

[Mr Alexander]

I will make a little progress, then I will be happy to give way.

Let me share with the House the description of Europe’s economic importance to Britain given to me in a recent parliamentary answer by none other than the Foreign Secretary:

“European markets account for half of the UK’s overall trade and foreign investments and as a result, around 3.5 million jobs in the UK are linked to the export of goods and services to the EU.”

He states that those markets provide

“the world’s most important trading zone, generating total GDP close to £10 billion in 2010”.—[Official Report, 12 July 2011; Vol. 531, c. 256W.]

In what I hope was a drafting error rather than an economic forecast, he of course got the size of Europe’s GDP wrong by a factor of 1,000. It actually had a GDP close to £10 trillion in 2010. The importance of the European economy to the British economy is none the less clear.

[Mr Redwood]

Does the right hon. Gentleman not agree that if Britain seeks a better deal, Germany will not turn around and say that it will not sell us any more cars and France will not say that it will sell us no more wine? That is an absurd scare.

[Mr Alexander]

Talking of absurd scares, it is now 12 years since the right hon. Gentleman pronounced the death of Britain in his book, so I am a little cautious of taking his advice on the matter.

All of us are aware that growth is stalling in Europe. Indeed, growth forecasts were downgraded in Germany just last week. We need to consider the economic effects at home and in our largest export markets abroad if the motion were to be passed. Businesses deciding whether to invest in Britain at this crucial time would have to make that decision not knowing whether it would still be in the European Union by the time that investment came to fruition.

[Mr Cash]

I would be most grateful if the shadow Foreign Secretary would answer the question that I put to the Foreign Secretary about the tremendous advantages that they claim for this economic miracle of Europe. How do you explain that under your watch, when you were in government—[Interruption.] Not yours, Mr Speaker. Can he explain why, under Labour’s watch, the trade deficit with the other 26 member states went up from minus £14 billion to minus £53 billion in one year between 2009 and 2010?

--- Later in debate ---

[Mr Speaker]

Order. May I just remind the hon. Gentleman that I have never been in government, and fortunately never will be?

[Mr Alexander]

The global financial crisis that was suffered in 2007 is hardly news to anybody in the House. Indeed, it seems to me that there is a broadening consensus that international economic circumstances affect the performance of the British economy. We are increasingly hearing that line from the Chancellor of the Exchequer.

The House has only recently debated the circumstances in which it judged it appropriate for a referendum to take place, and tried to formalise the process by which to decide what is significant and what is not. The current Government legislated for that in the European Union Act 2011.

[Mr Graham Stuart]

Does the right hon. Gentleman accept his role in the corrosive state of public mistrust in politics, after promising a referendum on the European constitution, aka Lisbon, and then breaking that promise, and of course after agreeing to the bail-out in the dying days of the last Government? Have the billions of pounds of public money that have been spent on that helped jobs in this country? I suggest to him that they have not.

[Mr Alexander]

First, the inconvenient truth for the hon. Gentleman is that there is no EU constitution. It was rejected by the Dutch and French voters. Secondly, if I recall properly, the newest member of the Cabinet, the Transport Secretary, is on record as having written a letter confirming the cross-party nature of support for the steps that were taken. In that sense, the hon. Gentleman might be better directing his question to the newest member of the Cabinet.

[Several hon. Members]

rose—

[Mr Alexander]

I am keen to make a little progress, then I will give way again.

What is proposed on the Order Paper is something entirely different from the recent debates. The motion suggests that the priority should be to debate, campaign on and decide on the question whether Britain should exit the European Union. That is the question of substance that sits beneath the motion—whether it is in Britain’s national interest to leave the EU.

I do not wish to intrude too much on the private grief of Conservative Back Benchers, but their disappointment in their Front Benchers is so great because their hopes were so high. The Foreign Secretary has journeyed a long way, because it was he who said:

“If you believe in an independent Britain then come with me and I will give you back your country.”

Yet if he was not rather conveniently getting on a plane to Australia this evening, the self-same Foreign Secretary would be coming with me into the No Lobby to support membership of the European Union. Along with the rest of the Conservative Front Benchers, he is today marooned between past pandering and his present position; between the rhetoric of opposition and the realities of government.

[Nadhim Zahawi]

Is the right hon. Gentleman’s party’s policy still to take this country into the euro?

--- Later in debate ---

[Mr Alexander]

It was the Labour Government who judged—

[Nadhim Zahawi]

Yes or no?

[Mr Alexander]

Just let me answer the question. The economics were not right to enter the euro; the economics are not right to enter the euro; and we do not envisage circumstances in which the economics will be right to enter the euro in the foreseeable future.

Let me offer Government Members a further argument about how they should vote this evening:

“What most people want in this country, I believe, is not actually to leave the European Union, but to reform the European Union”.

Those were not my words but the words of their own Prime Minister. And what of the Prime Minister’s real influence in Europe, about which we have heard something this afternoon? It is true that European leaders have been arguing for months, but President Sarkozy’s comments last night, which seem to have engendered pride among Conservative Members, confirmed that about the only thing that European leaders can agree upon is how unconvincing they find the stance of the British Prime Minister. Let me share with the House the President’s words. He said:

“We’re sick of you criticising us and telling us what to do. You say you hate the euro…and now you want to interfere in our meetings”.

When I read that, I thought for a moment that the President had joined the 1922 committee. The President, European leaders and even 1922 committee members are unconvinced by the position that the Prime Minister has adopted.

The Prime Minister boasts to the House that he will have a leading role when European leaders gather at lunch on Wednesday, but on last night’s performance, he will be lucky to get a bread roll from them. The Prime Minister’s isolation results directly from the sad truth that in recent weeks, the Government have spent more time negotiating with their Back Benchers than they have spent negotiating with European partners.

[Mr Baron]

May I suggest that the right hon. Gentleman is creating an Aunt Sally by talking about the economics of the EU? This debate is about whether we give a say to the British people by having a referendum on the future direction of the EU. Why will he not accept that there is disillusionment about ever-closer political union, and that this debate is not about free trade and access to EU markets?

[Mr Alexander]

First, the hon. Gentleman could have directed that question at the Foreign Secretary. Secondly, it is in the character of the EU that it is not open to the UK to say, “We will involve ourselves exclusively in economic and trade matters,” because we need to secure the support of other European partners for such changes. I accept that there is a concern among the British public in relation to Europe. My answer to that concern is not to leave Europe, but to reform it. In that way at least, I agree with Conservative Front Benchers.

[Mr David]

Would it not be far better for the Prime Minister of this country to argue the case for a growth strategy for the whole of the European Union instead of arguing with his Back Benchers?

--- Later in debate ---

[Mr Alexander]

We waited in vain for answers to the Leader of the Opposition’s questions on the British Government’s position on what should happen on Wednesday in relation to the scale and significance of the bail-out fund for Greece, and even if the issue of Greek debt is addressed, profound questions remain on economic growth and productivity.

[Andrew Bridgen]

Does the right hon. Gentleman recall that the previous Labour Government gave away a huge amount of our annual rebate in return for the reform of the common agricultural policy? How successful has that reform been?

[Mr Alexander]

I am glad that at least a degree of truth is entering our discussions—it was suggested earlier that the rebate had not been continued—but I recollect well the circumstances in which those negotiations took place back in 2005. If I recall correctly, there was broad cross-party agreement that we had a responsibility to welcome the A10—the new members of the EU—and that it was inevitable that the European budget would be adjusted to reflect their entry. I am unyielding in my continued commitment to the need for reform of the CAP—I hope that that is another matter on which there is genuine cross-party agreement.

[Michael Connarty]

There is a lot of talk about being honest with the British people. My right hon. Friend has exposed the false prospectus of the main Government party, but he has been light in tackling the Liberal Democrats, who committed themselves to a referendum, and who are now jumping into bed with the Tories just to keep—so it seems to me—their ministerial cars.

[Mr Alexander]

I want to deal with business before pleasure. That the Liberal Democrats take strong, principled stands in their manifesto and choose to break them only a matter of months later might simply be habitual, but I await with interest a speech from a Liberal Democrat that tries to make sense of the contortions that they have got themselves into.

[Mr Jim Cunningham (Coventry South) (Lab)]

Does my right hon. Friend agree that Government Members seriously underestimated the economic situation worldwide and thought that they could confine it to Britain, and that as a result the Prime Minister will have less credibility in Europe when he tries to renegotiate some of the powers that have been given to Europe?

[Mr Alexander]

I have great sympathy with that point. For many months before and after the election, the Conservative party suggested that Lehman Brothers collapsed and the Greek economy was in difficulty because the Labour Government built too many schools and hospitals and employed too many doctors and nurses. The Government are now attempting suddenly to change their story and attribute their having, this year alone, to reduce the growth forecast four times—if I recollect correctly—to the fact that the Greek and European economies are not performing appropriately. That they are having so much difficulty explaining the inadequacy of their own policy is diminishing their credibility not only in the halls of the European Council, but among the British public.

[Martin Horwood]

rose—

[Mr Alexander]

I am happy to give way to a Liberal Democrat.

[Martin Horwood]

The right hon. Gentleman is making an unfortunately partisan speech and misrepresenting the clear Liberal Democrat pledge to support a referendum at the time of a fundamental shift in the relationship between Britain and Europe—I am sure that that will be pointed out many times today. Should we not instead be uniting to counter the threat to the £351 billion of direct investment from other EU states posed by discussion of a referendum at this vital time?

[Mr Alexander]

I think that the person who started with a partisan speech was the Foreign Secretary, who was at pains continually to assert the position of the Conservative party—a very different approach from that of speaking on behalf of the Government, which is the conventional approach from Government members. However, if the hon. Member for Cheltenham (Martin Horwood) wants to continue to defend and account for the position of the Liberal Democrats, I wish him the best of luck.

[Robert Halfon (Harlow) (Con)]

Why does the right hon. Gentleman persist in treating the electorate as fools by describing the Lisbon treaty as not a European constitution, when everybody else knows that it is? Is this not one reason why there is so much mistrust in Europe?

[Mr Alexander]

Some of the frustration and disappointment I hear from the Government Benches would be better directed towards the Treasury Bench, rather than the Opposition. On Lisbon, one need only recollect the cast-iron guarantee that the now Prime Minister offered to his own Back Benchers. The position on Lisbon has been well-rehearsed. What was new, frankly, was the Prime Minister’s statement today that he supported a referendum on Maastricht. That must have been news to the Foreign Secretary, who entered the Division Lobby to oppose such a referendum—if I recollect correctly.

[Mr Jenkin]

The right hon. Gentleman says that we should concentrate on reforming the EU from within, but what happened during 13 years of Labour Government? They failed to reform the CAP and the budget, while the accounts have not been signed off for more than 14 years. What happened to the Lisbon competitiveness agenda, signed up to in 2010, to make Europe the most competitive economy in the world? Where were we by 2010? Has he not demonstrated that he tested that policy to destruction and that there must be change?

[Mr Alexander]

The hon. Gentleman takes an honourable position with which I disagree: that Britain’s best interests are served by leaving the EU. On the EU’s changing character, I would pray in aid the accession of 10 new members of what was previously the eastern bloc and the change that that has effected to the balance within the EU. Of course, however, there are continuing challenges, which is why I regard it as such a disappointment that the Government seem to glory in the isolation that the Prime Minister has secured for himself, when we should be arguing for continued reform not just of the European budget—

[Mr Jenkin]

You failed.

[Mr Alexander]

It was the hon. Gentleman’s own Prime Minister who went to Brussels last year asserting that there was going to be no rise in the European budget but left having voted in favour of a rise.

[Mr MacShane]

Can my right hon. Friend confirm that under Margaret Thatcher the CAP took 70% of the EEC-EU budgets, but that that figure is now less than 40%, and that under John Major the EU budget was 1.23% of European gross domestic product, but that it is now 1%? It is not perfect, but reform goes on all the time, and I wish the Foreign Secretary well as he continues those reforms. But do not live with these myths.

[Mr Alexander]

I concur with the bipartisan character of that intervention. The Prime Minister’s isolation results directly from the sad truth that in recent weeks the Government seem to have spent more time negotiating with the people from whom we have just heard.

[Several hon. Members]

rose—

[Mr Alexander]

No, I shall make some progress.

By default or design, the Government’s habit of sitting on the sidelines, only criticising and carping, has proved to be genuinely bad for Britain and the prospects for reform within Europe. All parties support the single market. We want to see reforms on the digital economy, services and energy that could make a real, practical difference to the lives and opportunities of British companies and consumers. All parties support European-level co-ordination on issues where we can work together internationally, such as—I agree with the Foreign Secretary on this—cutting off the oil that helps to prop up the Syrian regime of President Assad.

The way to address the present concerns is reform of Europe, not exit from Europe. Britain’s economy is flatlining and Europe’s economy is in crisis. Putting off investment and undermining confidence at such a critical time would be the wrong choice for this House and the country. The right course for British growth, British jobs and British interests is to reject the motion before the House.