European Union (Referendum) Bill
Debate between Edward Leigh and Lord Hain(11 years ago)
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Mr Hain
I am grateful that the hon. Gentleman raises that issue as I will deal with it later on and call for greater consultation on the matter. Unless the facts are revealed objectively and all organisations are properly consulted, people will not be in a position to make a sensible decision about whether to vote yes or no in the referendum he seeks.
The great flaw in the Bill is that it proposes no such consultation and there is no obligation on the Government to consult anybody. Other than a campaign that will be compressed into a particular period, and the inevitable media focus at the time, there is no sense that everybody will be involved in the great debate on an historic issue for the future of Britain, and indeed Europe. The Bill sets an arbitrary time limit without placing any obligation on the Government to consult. The referendum itself will be the only “consultation”—by bouncing voters into a decision by the end of 2017 or, if the hon. Member for Windsor gets his way, by October 2014.
For example, the business community needs to be properly consulted—paragraph (j) of new schedule 2 specifies how it could be consulted. The CBI, to which specific reference is made in the new schedule, recently reported that eight out of 10 of its members, including roughly the same proportion of its small and medium-sized enterprise members, said that they would vote for the UK to remain a member of the EU if a referendum were held tomorrow. The CBI should be properly consulted, not simply presented with a referendum on an arbitrary date. Nearly three quarters of CBI member businesses reported that the UK’s membership of the EU has had a positive overall impact on their business. They should be consulted, too, so that everybody, whether employees or management, can transmit their view to the wider community.
Sir Edward Leigh
Labour Members appear to want to consult the CBI, Uncle Tom Cobleigh and all, which is fair enough, but are they in favour of consulting the British people in a referendum—yes or no?
Mr Hain
Labour has never been afraid of consulting people in referendums. We have called more referendums in our history than any other party. Labour is the only party that ever called a referendum on the EU—the Conservatives took us into membership of the Common Market without one. Labour Members have never been afraid to consult the people, and we have specified the circumstances in which we would hold a referendum.
Despite CBI member companies’ frustrations with many aspects of EU membership, which, as a pro-European, I share, more than half of them—some 52%—say that they have directly benefited from the introduction of common European standards. Only 15% suggested that that had had a negative impact. A consultation would reveal that and enable it to be properly debated, assessed and considered.
Those CBI members believe that UK influence has helped to maximise the openness of the EU. Some 72% of British businesses believe that the UK has a significant influence on EU policies that affect them.
Mr Hain
As a Scottish MP of high repute in this House, my hon. Friend presents his evidence with some credibility. He is right that the Scottish referendum process reinforces exactly the case we are putting for these amendments.
Those who want us to withdraw from the EU suggest that we can have our cake and eat it by staying within the European single market to retain the great bulk of our trade, which is with EU countries. Once again, this could be assessed through a proper consultation, as specified in amendment 68 and new schedule 2. Those who want to withdraw first argue that we would avoid the costs of membership, which they denounce as too high; secondly, they insist that EU regulations make our economy uncompetitive; and thirdly, they allege a loss of sovereignty that comes with European political union.
Our amendments would enable us to assess what those arguments amount to and how seriously we should take them. They would provide an opportunity properly to consult all the different groups involved and all the different sources of expertise, which would reveal that the facts are rather different. It would reveal first that the price of Britain’s EU membership is rather more modest than the anti-Europeans would have us believe. The Government contributed £7 billion to the EU in 2012, which is around 1%—
Sir Edward Leigh
On a point of order, Madam Deputy Speaker. Is this a debate about the merits of remaining part of the European Union, or not?
amendment of the law
Debate between Edward Leigh and Lord Hain(11 years, 8 months ago)
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Mr Peter Hain (Neath) (Lab)
Contrary to the Chancellor’s mantra, Britain’s return to recession was not made in Europe. It was made in Britain by the severe fiscal squeeze that the Chancellor launched nearly three years ago. Problems in the eurozone spell trouble for the UK economy—of course they do—but the Chancellor never mentions the fact that Britain has benefited from the recovery of the USA economy, which accounts for 20% of our trade, and is currently growing four times faster than the eurozone is slowing, because the USA took the route of economic stimulus and stuck to it. Britain set out on the same path under Labour after the banking crisis, and the economy began to pick up. However, the coalition veered off as soon as the Tories and Lib Dems took office, turning the road to recovery under Labour into the road to ruin.
Cutting too far and too fast means that the Chancellor has missed all his key targets. In the year that is ending, his target deficit—the cyclically adjusted current deficit as a share of gross domestic product—is twice what he originally said it would be. Next year, the Office for Budget Responsibility expects it to be four times what he planned. He has also missed his public sector debt target: instead of falling to 67% of GDP in 2015-16, under the Budget it will fall to 85% two years later, in 2017-18. That is a surreal definition of success: debt falling upwards. Salvador Dali would be proud.
Zero growth has forced the Chancellor to accept higher borrowing targets—more than £200 billion higher over five years than he planned in 2010. Most of the cuts that have been announced have yet to hit home. Cuts and austerity will continue Britain’s economic inertia, with more disastrous, scorched earth economics to come. Growth, not cuts, should be the priority. Sadly, there is plenty of spare capacity in the UK economy, which could easily grow quite quickly for a few years by taking up the slack, with borrowing, the deficit and debt falling. Jonathan Portes, former chief economist at the Cabinet Office, said:
“A few years of 3% growth—and given the amount of spare capacity in the UK economy, there is no reason that should be infeasible…—and much of the problem will simply vanish”.
Growth is the magic bullet for overcoming our deficit and debt problems.
Mr Hain
Cuts have fuelled the recession because they have driven demand out of the economy. Getting the economy growing again, as I said, is the key to cutting the deficit, then stabilising and bringing down the debt burden. Once the economy is growing again, it will be much easier to deliver any remaining tax rises or spending cuts that may still be necessary because, as Jonathan Portes says, jobs will be plentiful, real incomes will rise and companies will invest again.
The Tory charge is that Labour would increase borrowing. The answer is, yes, in the short term, we would, but to reduce borrowing in the long term. Borrowing more today can mean borrowing less tomorrow by getting the economy growing again. President Obama’s 2009 stimulus package added to the US federal deficit in the short term, but as US interest rates fell, spending and output rose, and dole queues shortened. As a proportion of America’s expanding GDP, its overall deficit has shrunk every year since 2009, contrary to what has happened to our deficit. A budget boost that triggered real recovery in Britain could follow the same pattern, speeding up the growth of UK national income, cutting the deficit as a proportion of GDP and causing the debt burden to fall.
That is what the Budget should have been about, but old habits die hard as the coalition partners continue to peddle their big deceit. First, they said that the entire global banking crisis was caused by Labour recruiting far too many nurses, doctors, teachers and police officers, and that the trigger for the world financial collapse—sub-prime mortgage defaults in the USA—was all Labour’s fault. The second big deceit is their claim that today’s public sector deficit was caused by excessive Labour spending. To quote utterances of almost every Conservative MP as if on a dreary looped tape, too much Labour borrowing led to too much national debt, so the cuts are all Labour’s fault. They never admit the truth. They never say why, if spending was “out of control” and wildly excessive, the Chancellor in September 2007 committed a Tory Government to matching Labour’s public spending plans for the next three years, up to 2010.
The Chancellor knew only too well that Labour’s spending was affordable, otherwise he would not have signed up to that. The Tories never acknowledge that, until the global banking crisis, British Government debt was low, below that of France, Germany, the USA and Japan, and lower than when we took over from the Tories in 1997. Ten years of steady economic growth under Labour allowed us to pay down debt by the equivalent of £90 billion today, saving taxpayers some £3 billion a year in interest payments. We did fix the roof while the sun was shining.
Between 1997 and 2007, annual Labour borrowing averaged only one third of annual borrowing by the Thatcher and John Major Governments. This is the fourth dreadful Budget by a dreadful Government. It is the same old story from the same old Tories: Budget day blues for Britain. The Chancellor is playing a peculiar game of leapfrog with himself. Every Budget brings worse news. Every autumn statement confirms that things are worse than expected. The Government are failing on growth, failing to improve living standards, and failing on their debt, borrowing and deficit targets. They have got to make way for Labour.