EU: UK Isolation

Lord Dykes Excerpts

Monday 22nd April 2013 Grand Committee

Asked by

[Lord Dykes]

To ask Her Majesty’s Government what steps they will take to avoid increasing United Kingdom isolation in the European Union.

[Lord Dykes]

My Lords, I am most grateful to the usual channels for the opportunity of launching this vital debate today. Sadly, I have to say at once that the rather controversial and rather expensive funeral event last Wednesday provides a sombre memorial to this theme, recalling to all of us the negative attitudes towards Europe of someone who was—again, I feel sad about saying this—one of the most rebarbative Prime Ministers in Britain’s post-war history.

The present Prime Minister, however, was obliged to call off visits to EU capitals to discuss some changes in our links to the rest of the member states. It is very self-defeating if leading Tory Ministers and politicians refer to the over-repeated phrase “British national interest” as if that were wholly different from our membership of the Union and totally different from that of all the other members. At least the late-interred Prime Minister ended up usually agreeing with the others on treaty changes, despite all the Sturm und Drang in those days of shrill arguments. Mr Cameron, however, is now in danger of launching a risky plan which is designed to appease his wilder anti-EU MP colleagues, and which could quickly get out of control.

It also looks somewhat hilarious if a British politician starts trying to educate our German friends on the goals of economic and mercantile efficiency, bearing in mind the huge gulf in our economic performance. We have a UK trade deficit of around £100 billion, despite a quarter fall in the value of sterling over the past four years. Germany’s trade surplus is the other way round, but even bigger. We should all be grateful to the German ambassador for his polite but riveting comments at Bloomberg’s last July on the dangers inherent in irresponsible isolation and to Dr. Rudolph Adam, the plenipotentiary at the moment. He complained to William Hague’s assistant last October that Britain’s refusal to take a lead in Europe meant that we would just see the red lights of the train that has already left the station.

Indeed, we have heard the same complaints from our own citizens, now alarmed at this possible Cameron demarche. I refer to very prominent business leaders such as Richard Branson, Martin Sorrell and Sir Roger Carr. Incidentally, the US Government intervened collectively and individually to say, “Please do not go down this path”. Former EU and US British envoys such as Sir Nigel Sheinwald have taken this approach. Indeed, in one of our debates on 17 December 2012, the noble Lord, Lord Kerr of Kinlochard, who was originally speaking in this debate, said:

“As the Prime Minister prepares … I really hope he will avoid the temptation to hold out a false prospectus. One should not talk about ‘new deals’ unless one is sure that they are realistic”.—[Official Report, 17/12/12; col. 1391.]

It is never a weakness for any country, struggling as we are with our economic problems in an exposed position, to pay attention to what others think of us. Sadly, we have to recall, painfully, the derision which many mainland Europeans felt when we were first driven out of the exchange rate mechanism on 16 September 1992 as the Treasury was unable to keep the pound from falling below the agreed minimum level. We then became so scared at the huge obligation and discipline involved in a single currency that we effectively decided not to join at all, despite Tony Blair’s pretences.

We have to recall, therefore, the huge disappointment of the other members in other areas. We received the unique budget rebate but did not then become more co-operative on other areas of European endeavour, despite that unusual privilege. We have to recall the irritation, too, when we sought the biggest number of opt-outs and exclusions when Maastricht and the later treaties, including Lisbon, came along.

The irritation we now cause when a UK Minister arrives for a Council of Ministers meeting is palpable. We have become the bad member of the club, whingeing and moaning about European things again and again. One of the dottiest reasons for this irrational behaviour is because an unusually large number of old-fashioned nationalist Tory MPs are the only politicians I know—apart from some of the scallywags in UKIP, many of whom benefit from the PR system for the European Parliament—who have a notion of national sovereignty which is, literally, at least 100 years out of date.

How many times do positive Europeans have to remind such people that pooling sovereignty by way of signing unanimous treaties, achieved by consensus, is not a loss of real sovereignty, it is an increase? We have done it in other treaties, to no ill effect, all over the world. It is quite extraordinary and myopic that a false pride in our so-called special relationship and so-called hyperbolic link with the US can induce British leaders such as Mr Blair, Mr Brown and, indeed, the present Prime Minister, to go into rather questionable military adventures—which we usually later regret—but also cause us to suffer hot flushes when confronted with a perfectly sensible measure of EU co-operation such as a new financial support system between the central banks. They were watching our reactions very closely at that time.

At the same time, as if to emphasise the muddle, Mr Cameron seeks to remind us that he wants after all to stay in the Union. Before we irritate the others to the extent that they muse again about the Lisbon treaty provisions allowing for recalcitrant member states to leave if they wish, we really need some clarification on these vital—indeed, existential—matters. What relationship would replace the present one? As Peter Ludlow, the well known EU analyst based in Brussels, said in January,

“The argument that the rest of Europe will simply acquiesce in whatever kind or arrangement (we) opt for, because ... our partners need us ... more than the UK needs them, is a total illusion”.

Furthermore, when you use the microscope on repatriation, you soon realise that it is the grand illusion and pretence of all time, especially when you see that we already have more opt-outs, exceptions, derogations and exclusions than any other country.

I am therefore extremely grateful to my noble friend the Senior Minister of State at the Foreign Office, Lady Warsi, for coming to answer this debate today— I wish her well in her response—and, indeed, for all the previous occasions when she has dealt with a vast number of questions and debates on these matters with great care and attention to detail. Now she has the precious opportunity to enlighten us all so that we can leave this discussion with a spring in our step.

A few weeks after the PM sadly refused to attend the Nobel Peace Prize award to the European Community in Oslo, I had the chance to ask my noble friend what further opt-outs we would now seek in Brussels. She very kindly stated that,

“the Government always seek outcomes that are in the national interest … our priorities include … the single market and … fair competition”.

When I pressed for more specific answers to try to,

“avoid needless opt-outs of a chauvinistic or nationalistic nature”,

she added that HMG should be,

“putting a case … that the European Union is improved but, within that, we also get a good deal”.—[Official Report, 4/2/13; col. 9.].

I hope that she will not consider it discourteous to suggest that this is all rather vague and generalised.

I live in France as well and have the opportunity to observe public life and politics there at close quarters. It is interesting that such a proud—indeed, sometimes very nationalistic—country sees absolutely no contradiction between its own direct interests and those of the Union. They coincide symbolically too—as in Berlin and Madrid, and most other capitals, the EU flag flies proudly alongside the national tricolour. They do not feel the one cancels out the other. The UK is the only major member state where government buildings never, ever fly the European flag. Why are we so nervous about Europe? Why are we so immature?

Let us return to the need for detail on policies. For example can the Minister guide us on what list of opt-outs we will determine for inclusion and exclusion in the JHA review? My impression is that the Government have not got a clue what to do. My noble friend will know of the report of sub-committees E and F of the EU Select Committee showing the huge weight of non-political evidence that abandoning the JHA provisions, or the principal ones, in most of the specific policy areas such as EAW, would be a monumental disaster. I will refrain from commenting too much on what Kenneth Clarke said at the end of January on these matters. How the Prime Minister must now regret the way in which the Government, including when they were in opposition, have encouraged the most Europhobic MPs to fuel this anti-EU strategy with the business community outside—although not many leading businessmen are now still involved—to the extent that it is even becoming part of future leadership moves by some ambitious new Tory MPs. The bitterness felt by the EPP in Brussels and Strasbourg about the Tory withdrawal in the European Parliament still lingers.

Can the Minister help us today about what kind of referendum will be constructed after so-called renegotiations have run their course, especially since the Business Secretary reminded us again recently that it will scare off investors and hit the economy?

The other area where we need meticulous care by the Government is in responding to the widespread dismay about the City of London market culture which is expressed here so stridently. The City—and I am a City person myself—is indeed a very precious asset which we are proud of and fortunate to possess, but the market crash of 2007-08, the way in which the banks behaved and the speculative spivery background of some people in the City offend some of our continental friends, and that needs to be acknowledged. Although I shall not quote from them, I commend in this context the lengthy but convincing last two paragraphs of the speech by the noble Lord, Lord Liddle, the chief Opposition spokesperson on Europe in this House, in the debate on the EUC report on banking union in Grand Committee on 26 March. He set out very clearly what our responsibilities should be.

Another area where the UK needs to respond sensitively to our partners is in their anxieties about tax havens, where our overseas territories are a particular preoccupation. Above all, we need to remember the chilling reality that, apart from the natural courtesy of a vague response, not a single other member state agrees with our peculiar attitudes, these initiatives that have recently been promulgated, not even the newest member states, not even Poland, very little in the Czech Republic, not at all in Spain or Italy and certainly not in Croatia. The Tory party needs to show the courage and enthusiasm for Europe that Mrs Thatcher showed in 1975.

I look forward to my noble friend helping us today with some encouraging responses about how these strange negotiations will reduce our isolation.