European Union (Amendment) Act 2008

Jacob Rees-Mogg Excerpts

Wednesday 16th March 2011 Commons Chamber

[Mr Wayne David (Caerphilly) (Lab)]

There is no doubt that it is in Britain’s national interest to do everything we can to ensure that the eurozone is stable and prosperous. It was therefore right for the European financial stabilisation mechanism, the EFSM, and the European financial stabilisation facility, the EFSF, to be created last May. In those extraordinary and dangerous circumstances, it was necessary to take swift action. More than 40% of Britain’s exports go to the eurozone. If this country is to secure a strong economic recovery, exports to the eurozone must play a vital role.

[Jacob Rees-Mogg (North East Somerset) (Con)]

I thank the shadow Minister for giving way. I wonder if he is correct. The history of economic crises shows that the countries that devalue and default first are often the first to recover. By sticking with the euro, Europe has therefore made a mistake and lengthened the period of distress for Ireland, Spain, Portugal and the other economies.

[Mr David]

It is for other European Union member states to decide whether they wish to be part of the eurozone, and there is no doubting their commitment to it.

When the dust had settled after the fraught days in May 2010, moves were made to establish a more permanent stabilisation mechanism, facilitated by a treaty change to provide a stronger legal base. That mechanism will come into force after 2013 and will replace the EFSM and the EFSF.

I find the procedure before us rather strange, to say the least. When or if the European Union Bill, which is currently in the other place, reaches the statute book, there will be a change to the relevant constitutional procedure, as the Minister explained, and the procedure that we are using this evening will no longer apply. Instead, we will have what is essentially a post-decision procedure. Treaty changes will require a statement to be laid before Parliament on whether the decision falls within clause 4 of that Bill. I understand that the treaty change to establish the European stabilisation mechanism would not fall within clause 4, so would not trigger a referendum. However, it would require an Act of Parliament. The Government have said on at least three occasions, and have confirmed this evening, that they would seek the support of the House, using the procedures of the European Union Bill, by introducing primary legislation. As the Financial Secretary to the Treasury said:

“The mechanism is not a transfer of power from Westminster to Brussels, so it does not require a referendum, but it will require primary legislation, which will be introduced in due course.”—[Official Report, European Committee B, 1 February 2011; c. 12.]

Given that commitment, I wondered why the Government were putting forward this motion at this time. The reason, of course, lies in section 6 of the European Union (Amendment) Act 2008, which requires that when a decision under article 48(6) of the treaty on European Union is proposed, a Minister must introduce a motion and have it passed by both Houses of Parliament without amendment. That must happen before the Prime Minister can give his agreement to the adoption of a draft decision at the European Council. In other words, for the Prime Minister to be able to give Britain’s support to this draft proposal at the European Council meeting at the end of next week, it is necessary to secure the approval of Parliament.

I want to make a point about procedure. I welcome what the Minister said earlier on this matter, and I hope that the Prime Minister will adhere to that if there is even the smallest change to the proposed amendment. I hope that that is truly a cast-iron commitment.

--- Later in debate ---

[Mr David]

I hear what the Minister says, but it does not alter the fact that we will no longer be in a position effectively to give the Prime Minister a mandate. Effectively, he will be able to do what he wants and have it retrospectively approved.

[Jacob Rees-Mogg]

I thank the shadow Minister for giving way a second time. It is very generous of him.

Tonight’s debate came about initially because of a suggestion by the European Scrutiny Committee, which could continue to recommend draft decisions for debate in the House before the Prime Minister went off to negotiate, and then we could have a Bill later. I do not really think we have lost anything.

[Mr David]

I think that statement was really made for the Minister’s benefit, and it would be useful to have his response to it.