European Union Bill

John Redwood Excerpts

Tuesday 7th December 2010 Commons Chamber

[Mr Hague]

My hon. Friend may have worked out that the Bill has exactly the same effect as amending the Act and that it therefore absolutely honours the commitment in the coalition agreement. We additionally agreed, in the coalition agreement, that we would not agree to any transfer of powers from Westminster to Brussels for the duration of this Parliament. In addition, if Parliament approves the Bill, any future treaty change that transfers powers from Britain to the EU could be agreed only subject to the consent of the British people. That will provide a referendum lock to which the British people hold the key. The Bill makes a very important and radical change to how decisions on the EU are made in this country. It is the most important change since we joined what was then called the European Economic Community. It marks a fundamental shift in power from Ministers of the Crown to Parliament and the voters themselves on the most important decisions of all: who gets to decide what.

It has been said that because the Bill will place a high democratic test before any Government can agree to participation in deeper political integration in the EU, it will marginalise Britain, but I believe that that argument is dangerously mistaken in its assumption of what progress in the EU means. The yardstick for progress in the European Union is not the depth of political integration. The lost opportunities of the past decade of institutional navel-gazing have made that plain. Progress for the European Union means its institutions’ ability and willingness to help its member states meet the challenges of today, and for us today that means our international economic competitiveness, sustainable low-carbon growth and the use of our collective weight in the world to advance our shared values and interests.

That is why, from their first day, the Government have been active and activist in European policy. That is why we have played a strong and positive role in the EU which in six months has delivered significant results—agreement on EU sanctions against the Iranian Government that are already having a material effect, and agreement on measures that will substantially aid Pakistan’s economic recovery in the aftermath of the floods. We have pushed hard at EU level on measures to further free trade, in particular with Pakistan and South Korea, thus far with success.

The UK has not taken part in every aspect of the EU’s development. The euro was created, and the decision to retain our own currency has, for example, been vindicated. Staying out of the euro and maintaining our own border controls has not weakened our influence, either. The previous Government’s successful championing of enlargement to the east, to which I pay tribute, is proof of that. In the single market—for example, on patent reform—the UK should be ready to move forward in the national interest with other like-minded partners.

As in all matters, the Government’s policy on European issues should be based on the pursuit of our enlightened national interest. Our ability to advance our goals by working with European partners is crucial to that. Ensuring that our role is based on democratic consent is equally necessary, and that is what the Bill is about.

[Mr John Redwood (Wokingham) (Con)]

Will the Foreign Secretary explain why, when the Government are giving away powers to regulate the City, powers over criminal justice, powers in two regulations and a directive that will affect our economic governance, and big new powers for an expanded External Action Service, none of those qualifies for a referendum under the Bill? People want a referendum now on the powers that the current Government are giving away.

[Mr Hague]

That is simply because we are not giving away those powers. The European External Action Service was agreed, established and given its role by the Lisbon treaty. My right hon. Friend may regret that, and I may regret that, but it was given by the Lisbon treaty. On the City, the European Union has long had the power to legislate in this area, which has equally long been subject to qualified majority voting and co-decision with the European Parliament. On economic governance, it is clear—for instance, in the Van Rompuy report on economic governance—that the proposed sanctions do not apply to the United Kingdom and that the proposed changes will not affect the United Kingdom. I reject my right hon. Friend’s basic thesis.

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[Yvette Cooper]

If only the Foreign Secretary’s willingness to open EU buildings extended to opening a proper debate on European issues in the House. Clause 10 purports to increase Parliament’s role before ministerial decisions are made, yet the truth is that the Government do the opposite. We have had no discussion of the European economy prior to the discussion between European Finance Ministers today, no discussion of practical measures to cut the European budget, such as reform of the common agricultural policy, and no discussion of working with Europe on human trafficking or the directive that the Government continue to opt out of.

This very morning, European Finance Ministers met to discuss the Irish support package and the European economy. In 10 days’ time, decisions will be made on the crisis resolution measures that will affect the entire European economy—not just the eurozone—for many years to come. National leaders will discuss a treaty change to introduce that package, yet when is the debate in the British Parliament? We have no idea what British Government Ministers are proposing or asking for.

We should hold pre-Council debates in this Chamber. The economic and political pressures that Europe faces are serious. European growth is slowing, unemployment has increased and markets are putting pressure on several eurozone countries, all of which matters immensely to Britain, yet we have had no pre-Council debates. At the end of this year, there will have been four European Councils, but no debate.

[Mr Redwood]

The right hon. Lady is raising crucial issues. Does her party support the idea of Britain being part of more EU economic governance powers to help euroland, and does she think we ought to offer more financial assistance to other euroland countries in crisis?

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[Mr John Redwood (Wokingham) (Con)]

This Bill is born of a very serious mood in our country. A majority of people in Britain feel that a great amount of power has already passed to the European Union over the past 20 years, and they feel that powers are still drifting away under this new Government. They would like to see that progress arrested, and they would like to see powers brought back in certain crucial areas. They would like to feel that more of their lives were under democratic, accountable government here in Westminster than under the less accountable, less democratic government of the European Union. The Government would be wise to heed the seriousness of that view among many in this Parliament, representing many outside it.

I welcome the Foreign Secretary’s noble aim. He says that the aim of his legislation and policy is to give us all a greater sense of empowerment when it comes to matters of European governance and action. I would urge him to look again at his Bill, however. It is certainly cleverly contrived, and it is certainly contrived in a great deal of detail, but it is, in practice, the not-the-referendum Bill. On every area of competence and power that we see drifting away or being transferred from us as we have this debate, we are told, “That would not qualify for a referendum under this legislation.”

I believe that the Foreign Secretary has taken legal advice, and he wants to have a referendum on the transfer of competences rather than on the transfer of powers. I would suggest that that is a tad too clever. We all know that most of the competences have already gone. That was what Lisbon was all about. That was why he and I fought tooth and nail, together, against that treaty and in favour of a referendum on the treaty. Most of the things that the Government now wish to do are a shared competence with the European Union. What matters is not a further transfer of competence, but a further grab or transfer of power by the European authorities.

When the Conservatives were in office, we made it very clear that we wanted trading relationships and friendships, and a certain amount of common legislating in single market and related areas, but not a common Government or political union. To reflect that, the architecture that we persuaded the partners to accept had the third pillar areas of foreign affairs and home affairs, which were matters for independent sovereign states to decide, and we always preserved the veto on any common action. That has now been eroded. So, as we meet to debate the so-called referendum lock, we see powers on home affairs being surrendered, issue by issue, by this Government—as they were by the previous Government—which will result in a much more common criminal jurisdiction from the European level. The British people need a voice on that matter; they need to be asked about it. Some of them might even agree with it, but they want to be treated seriously, as grown-ups, and asked if that is how they want their country to be run in the future.

On foreign affairs, we are being told as we meet that we still have a veto on the big issues and that my right hon. Friend the Foreign Secretary can play his part in shaping a common European action and diplomatic strategy. At the very same time as we have to cut severely the growth rate of our public spending and make some deep cuts in certain areas, which we do not like, we see the European budget going up rapidly, partly to finance a big expansion in the European diplomatic service. This is not being done in order to have holidays in the sun, as some national newspapers seem to suggest, but because the EU wishes to exercise power and authority on our behalf and on behalf of other member states.

[Mr Jenkin]

I do not think that the Foreign Office has fully understood the consequences of encouraging this to go ahead, which is what it did. I am afraid that a great many of us voted for it in this House. The European External Action Service is ordering much more expensive cars, is to have grander embassies and is to pay much higher salaries than our own diplomatic service. That will be to the detriment of our diplomatic service because it will attract the talent away from our service and towards the European External Action Service.

[Mr Redwood]

It means that when a British Foreign Secretary makes foreign visits, he or she will be kept waiting while the EU ambassador is received and considered, because the latter will speak with more authority on behalf of more people and more states.

It is the third area that we have always reserved for national veto and national competence—central economic policy making—to which I shall address the remainder of my brief remarks in this truncated debate. Literally as we meet here this afternoon, crucial and massive issues are being hammered out in secret around the Council table in Brussels. Quite likely to be on the agenda is the issue of European sovereign bonds and the effective creation of a European sovereign in financial matters that issues debt and guarantees debt on behalf of member states. Do we want that? Are we in it? Is it not a transfer of power if we go along with it? Is it not an issue on which we should be invited to express our views?

Another item on the agenda may be the future membership of the euro. The Council could be considering in secret whether all member states are able to stay in the euro and whether the strong or the weak members should leave. If they are to keep the euro area together, what will be the arrangements for the large transfer payments that need to be made if the single currency is to have some hope of a decent life in the future, as all successful single currency areas have much bigger transfers of tax revenues, subsidies and money around them than the euro area currently has?

[Mr Cash]

My right hon. Friend portrays so accurately the realities that lie behind this Bill, which is about the economic crisis in Europe as well as many other matters. Does he agree that one serious current problem is the financial stability mechanisms and that if we do not assert our rights in this House and make certain that the courts cannot get their hands on an interpretation that would go the other way, we could end up paying for other countries beyond Ireland—Portugal, Spain and others?

[Mr Redwood]

My hon. Friend is absolutely right, which is why the transfer of power, if not of competence, is such a crucial issue and why we need to engage in a public debate at this very moment about how far this should go.

I hasten to stress to the House—particularly to my critics, who like to misconstrue what I say—that I wish our partners every success and prosperity with their single currency. I know that if that is the way they choose to run their economies, it is in our interests for it to work. We want them to be happier and more prosperous, and we like to benefit from trading with them, just as they like selling us a lot of their products. My worry is that in the process of our enthusiasm for that, we will draw in Britain—with her rather stretched budgets, even after the changes that the Government have rightly and wisely made—at a time when we do not have the financial strength to go to the aid of all these other euroland countries that are in some difficulty under the euro scheme.

I am a critic of the Irish loan. Of course I do not want to see the Irish economy go down, but I do not happen to think that lending the country lots of money at that juncture, as a result of a crisis deliberately created by the European Central Bank, was a terribly good way to behave. I do not believe that if Britain had declined to make some money available, the Irish loan would not have been negotiated. It would have been negotiated quite successfully by the architects of it—the powers behind the European Central Bank, who literally decided to withdraw funds from the Irish banks at a difficult time and made that decision public, thereby precipitating the crisis. We were engaged in a refinancing package for the European Central Bank. I think we should be told the truth; we should be told why it was a good idea for a country that rightly stayed out of the euro because it did not want the financial risk and hassle, to be drawn into helping finance the consequences of an ill-judged currency without a political union.

A successful currency needs a sovereign to love it and support it. That is why the sovereign’s face traditionally appears on the coinage and why there has to be a symbol to show that the whole weight of legal and economic authority stands behind a currency. If Europe is to have a successful euro, she needs a sovereign. I do not want my country to be part of the euro, and I think that around 80% of the British people agree with me. I think that even Opposition Members temporarily agree with me on this issue; they are not rushing to say that now is a good time to join the euro. We should be open and honest with the British people and say, “We wish the euro well.” We are doing it a great favour by not trying to join it—we would have been an over-mighty subject in it, which might even had led to its toppling earlier—and we are not currently in a financial position to make all the transfer payments available that are necessary for full members of a single currency area.

The House needs to understand that while we are debating some abstruse language and pledging this and future Governments to hold a referendum on treaties unknown about competences unspecified, a potentially massive transfer of power is under way yet again from the member states to the centre. There has to be; the thing cannot work without more central power behind the banks and the economic institutions.

The British Government say that they will accept a treaty extending the centralising powers in the economic sphere because the penalties on these will not apply to the UK Government. Well, I am delighted that the penalties will not apply, but I see no reason why the requirements should apply either, because we are not part of the euro. We should offer our support for a strengthening of economic governance for the euro area alone and make it clear that all the regulations and the directives apply only to that area. I think that my right hon. Friend the Foreign Secretary got it wrong when he said that none of those applies to Britain; several of them do, although without the ultimate penalties. There could be other penalties, incidentally, which might apply to Britain.

When we surrender our veto and allow this treaty to go through on that condition—that it applies only to euroland—we should say that we want something back. We should seek to establish that we believe the European Union already has too much power and that we want something back. Do we want our fisheries back; do we want control over our borders back; do we want control over elements of taxation that have already gone to Europe through common taxation and a series of court judgments?

Power is seeping away as we meet. A massive debate is under way. Will the Government please take this Parliament and the British people into their confidence? Will they take us seriously? Will they give us an adult debate on the reality rather than this show Bill?

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[Tim Farron]

Every act of legislation creates a possibility of further litigation. That is the nature of what we do. The hon. Gentleman raises an important issue, and if this Bill becomes an Act it will deal with many of the uncertainties and genuine concerns raised by my hon. Friends from a different party about our position in the European Union and the legitimacy of the decisions that are taken. The power should ultimately rest in this place and—even more ultimately—with the British people.

[Mr Redwood]

rose—

[Mr MacShane]

rose—

[Tim Farron]

I had better be fair and give way to my right hon. Friend the Member for Wokingham (Mr Redwood). Then, I think, I will have no more opportunities to give way.

[Mr Redwood]

Will my hon. Friend explain why we had 13 years of a pro-European Government who said we were at the heart of Europe when we were still in the boot?

[Tim Farron]

My right hon. Friend makes a very good point. The reality is that for 13 years we had a Government who said they were pro-Europe but never went on the front foot and defended that position. There are all sorts of reasons to defend our position in the European Union and say that this country’s interests are best placed if we are inside the EU. However, because of the national mood and if we were to have a referendum today on in or out, there is a very good chance that—

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[Mr Lidington]

We debated this matter at great length in Committee in January. A number of the learned academics who gave evidence to the European Scrutiny Committee discussed parliamentary sovereignty in broad constitutional terms, rather than in terms of the precise objective of clause 18, which is to recapitulate in statutory form the means by which European law is given effect in the United Kingdom.

I want to make it clear from the start that we are talking about a referendum lock on future treaty changes that transfer powers or competence—in particular, powers involving the surrender of vetoes—and that we are not seeking to overturn the terms of existing treaties. I know that that will disappoint a number of Members on both sides of the House, but, as my right hon. Friend the Foreign Secretary said in his opening speech, we are in a legal environment established by the Lisbon treaty, even though some of us might wish that we were not, and we must start from the position that we are now in.

[Mr Redwood]

Will the Minister tell us whether he can conceive of any circumstances in which this Government would offer a referendum on any aspect of Europe?

[Mr Lidington]

I thought I had made that clear—[Interruption.] The Government—[Interruption.]