Draft European Union Budget

Ian Davidson Excerpts

Thursday 12th July 2012 Commons Chamber

[Mr Hoban]

Absolutely. My hon. Friend is spot on and it will cost this country £10 billion over the lifetime of this Parliament. That is the disgraceful way in which our rebate was given away for some review of the CAP that never materialised.

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

As the Minister will be aware, I am no great defender of the previous Government’s position on these matters. However, simply pointing to the previous Government’s position is not answering the question. Will this Government make it clear that they will not agree to an increase in the money going to the EU? Yes or no?

[Mr Hoban]

We are going through the process and we have been very clear about our red lines for own resources and the rebate. We have tried to reach a common position with our allies on the size of the budget and of the multi-annual financial framework. We have been very clear that, at a time when member states across the EU are being asked to curb their spending, the EU should play its role in doing that, too. That is what we are seeking to do, not just in the budget but in the financial framework. Just as we have delivered spending restraint at home, we are urging the case for delivering spending restraint in the EU. We have argued forcefully that we need to tackle the chronic over-budgeting and strictly prioritise EU spending. We need significant cuts in the Commission’s spending and I think that they are possible without impeding efforts to boost growth.

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[Chris Leslie]

That is why we need to change the approach of Ministers in negotiations. We have to come to a settlement. This year, we are on the cusp of Ministers having a veto power over the seven-year spending review period. This is the moment when we need them to be particularly firm.

[Mr Davidson]

Does my hon. Friend feel so strongly about making sure that the agreement we strike with Europe has the support of the people of Britain that he thinks the budget settlement should be the subject of a referendum? That would be an ideal way to determine the long-term budget—the people themselves voting in a referendum on whether they are prepared to accept it.

[Chris Leslie]

I see the tempting avenue down which my hon. Friend wants to go. I am not sure that it is necessarily good to budget by referendum. It would be simple for the Chancellor, the Prime Minister and the Minister to firm up their position and set out things much more clearly than they have in the motion. I urge hon. Members to look at the airy-fairy fudging language of the motion today—and going forwards, which the Minister does not like to talk about.

The Minister was right to draw on the Financial Times analysis, including in pointing out the reduction of just six administrative staff from the 41,000 EU posts. Some increases for pensions, for schooling allowances for EU officials and even for some of those extra accession activities in relation to Croatia, are still pencilled in by the Commission. I do not think that the administrative budget proposals on the table are justified. Instead, we should be reprioritising the resources paid to the EU budget so that they are sweated more effectively for a pro-growth, pro-jobs position—looking at energy markets, high-speed broadband and the infrastructure and structural fund changes that need to be made. I do not think that the Government have appreciated the strength of feeling on this matter.

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[Chris Heaton-Harris]

No, I cannot. One point that I am trying to make is that, if we want to be stronger and to cause a bit of upset among our European partners, we could dig our heels in. The Government are doing what they can, while abiding by the letter and spirit of the law, but we could change the face of public services in the UK with just the increase in our contribution to next year’s budget. It is therefore perhaps worth digging our heels in that bit harder and threatening to do something that might be against the letter of the law. There would be a relatively large amount of public approval for such actions in respect of an organisation that has not had its accounts signed off for 17 years, as the hon. Gentleman says.

There would be more public approval for such actions if people knew what the money is spent on. I shall speak for just one more minute, because I know other hon. Members wish to speak, and outline a handful of things that the European budget goes on. Total EU spending in 2012 on quangos and agencies, which the Minister mentioned, was about €2.48 billion. Some agencies and quangos completely duplicate other bodies that serve the EU and member states, such as the Economic and Social Committee and the Committee of the Regions, which the European Commission is meant to consult but which no one has ever heard of, apart from those illustrious members of our communities that enjoy going on the monthly trips to serve on them. We could cut those and save €215 million straight away, but British Governments of either political complexion have never suggested it.

There are two human rights agencies. We could cut at least one of them, saving €15 million. Four agencies are involved in workplace and environment issues. We could cut a number of those and save €50 million. If we dig and delve deeply enough, we find that each EU Commission budget line funds all sorts of things that it probably should not. Hundreds if not thousands of non-governmental and other organisations get money from the EU budget. The have become slightly too close to the EU and should question whether that helps them to get their point across, even if it helps them in budgetary terms. Greenpeace is not one such organisation—it refuses to take any money from any governmental institution.

[Mr Davidson]

Is the hon. Gentleman aware of how the system operates? The EU gives money to organisations that it has established, so that they can lobby the EU to spend money on their aims.

[Chris Heaton-Harris]

To illustrate exactly that point, I shall quote the reasons Greenpeace gives for not taking money from governmental institutions:

“Greenpeace does not solicit or accept funding from governments, corporations or political parties. Greenpeace neither seeks nor accepts donations that could compromise its independence, aims, objectives or integrity… Greenpeace relies on the voluntary donations of individual supporters, and on grant support from foundations.”

I take EU lobbying by Greenpeace way more seriously, because it comes from the heart and not from an EU budget line.

My next example is the LIFE+ programme budget line, which funds, among other groups, Avalon, which co-ordinates activities and lobbies on behalf of sustainable rural development in central and eastern European regions; BirdLife Europe; CEE Bankwatch; Climate Action Network Europe; Coalition Clean Baltic; Danube Environmental Forum; EUCC Coastal and Marine Union; Eurogroup for Wildlife and Laboratory Animals; EUROPARC; the European Environmental Bureau; European Environmental Citizens Organisation for Standardisation; European Federation for Transport and Environment; European Landowners Association; European Water Association; Federation of Associations for Hunting and Conservation of the EU; FERN; Friends of the Earth Europe, which constantly lobbies hon. Members on all sorts of things; Health and Environment Alliance; International Federation of Organic Agriculture Movements EU group; International Friends of Nature; International Network for Sustainable Energy; Justice and Environment; and the Mediterranean Information Office for Environment, Culture and Sustainable Development. The list goes on. Just one budget line funds all those organisations.

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

It is noticeable that, so far as I am aware, not a single Member has risen to defend the European Commission’s case for an expansion of its budget. Not even my right hon. Friend the Member for Leicester East (Keith Vaz)—representing Leicester and Brussels East—who is just departing, dared to suggest that the budget should be increased. I note that not a single Liberal Democrat has bothered to turn up to defend the EU’s budget proposals either. When I indicated my intention to speak in this debate, the Whips Office very generously offered me the chance to have the day off, on three occasions, despite the three-line Whip. Nevertheless, I felt it appropriate to share my views with the House.

This is the one area where, in respect of the UK Budget, virtually everybody is agreed that substantial cuts can be made. At a time of austerity, it is clearly indefensible to spend copious amounts of money on the European budget in the way we do. If I remember correctly, the Minister mentioned European schools, so will he tell us how much money is spent per teacher and per pupil in European schools in comparison with schools in the UK, either for the individual nations or across the UK as a whole? That would enable people to see the disparity. Will the Minister provide for the information of Members an account of the salaries and other rewards, and the tax and other deductions, of the top 100 most highly paid people in the European Commission and of those of the top people employed by the British Government? I believe such a comparison would reveal the level of extravagance of the European Commission in supporting itself in the style to which it has become accustomed to be outrageous and indefensible.

The Minister did not mention to any great extent the case for making cuts in the common agricultural policy, which is the wildest example of a benefits system for the least deserving that I have ever come across in my life. We have attacked the poor by changing their benefits system, yet we are not prepared to take any steps to try to amend the benefits system that works for this country’s wealthiest landowners. The waste and extravagance of the EU fails to be audited successfully year after year—to the great complaint of the Public Accounts Committee on which I served for many years.

It seems obvious that the Minister and Conservative Members must have something in their notes, saying: “weak case; kick Opposition”. I accept that the Opposition’s case is weak. I did not support the budget changes when we gave away the rebate: we got virtually nothing for it; we got no change to the common agricultural policy, and those responsible for it did not even get the presidency of the European Union. In those circumstances, it was a patently disastrous deal, but simply reflecting on that is not sufficient. The Minister needs to be more explicit about how exactly he proposes to deal with the situation in which we are perpetually outvoted in qualified majority voting by those who receive money from those who pay. There is an in-built majority of recipients, so it is inevitable in those circumstances that we will always lose.

The question arises of what we do about the next overall budget for the longer period. I am not clear whether the Government are saying unequivocally that they intend to veto that budget if it is unsatisfactory. I am not clear how they will judge whether or not the proposed budget will count as unsatisfactory. An hon. Member asked earlier whether the Government would view a cash increase as acceptable in any terms. I would have thought that a cash freeze should be the very least that the Government would expect from the budget going forward. I would have hoped that we wanted to see, at the minimum, substantial cuts in a whole host of areas of the EU budget—and that otherwise we would reject it. If that brings about a confrontation with our European allies—those with whom we wish to work on many fronts—it might bring about the sort of issue on which we want a referendum.

I have not previously favoured an in/out referendum because I regard neither of those options as particularly attractive: a yes to stay in would be seen as a green light to ever-closer union, while a no to get out would be seen by isolationists as a green light to their position. I believe in co-operation with our European allies, but on different terms from those that we have at present. The Government have a responsibility to be fair to our European allies so that they do not feel that they have been ambushed by our producing—like a rabbit out of a hat—a whole set of red lines at the last minute. We should be spelling out now what it is that we are not prepared to accept in any drastic redrawing of the budget.

I hope, of course, that the budget cuts will be so drastic that my hon. Friends support them as well. It is noticeable that Opposition Members have been unanimous in criticising the European budget, and I think that if a vote were taken now among the Opposition Back Benchers who are currently present, the budget would be subjected to stringent cuts.

The Government must recognise that the country is far more Eurosceptic and suspicious of EU budget spending than the élites of Europe who are disproportionately spoken for in the House. It is true that the Liberal Democrats are not here, but they are not the only guilty parties. There are those who have become hypnotised by the lure of Brussels and the concept of flying back and forth throughout Europe. They have been sucked in by a very seductive embrace: the idea of becoming a European statesmen, and world statesmen, and so on and so forth. That leads people to forget what life is like at home, and the feelings and ambitions of ordinary people, let alone the price of milk.

I hope that the Financial Secretary will not only agree to provide the information for which I asked about schools and the salaries and taxation of the top 100, but spell out more clearly the rules that the Government intend to apply for the forthcoming budget period.