European Union Referendum Bill

Lord Hamilton of Epsom Excerpts

Monday 23rd November 2015 Lords Chamber

[Lord Pearson of Rannoch (UKIP)]

My Lords, do I understand Mr Redwood’s position to be that, if we repeal the 1972 Act, all the other treaties that come after that Act—the Single European Act, Maastricht, Amsterdam, Nice and Lisbon—are all amendments to the original 1972 Act? If we repeal the 1972 Act, the other 27 member states may start getting difficult with us, but it is unlikely. We should be in the driving seat, not least because of the amount of money we give them, which of course we need not decide to axe overnight. We could say that if they behave themselves, we will taper the £20 billion a year we give them nice and slowly. Likewise, it is in their interests to go along with us and our free trade with them, the single market and all the rest of it, because we are their largest clients—as I said earlier. We have a certain amount of pressure with the non-EU free trade agreements, some of which have been organised entirely by the Commission and some by the European Commission and us in our sovereign right, as I am sure the noble Lord knows. It is a boggy area, but surely it depends on the political will of the Government of this country, and the political will of the Prime Minister.

Therefore I put it to the noble Lord that he is seeking to gaze into a crystal ball that is somewhat clouded. If the Prime Minister has negotiated a reform and comes back from Brussels with a piece of white paper saying “Reform in our time”, but the British people do not like it—if the British Prime Minister wants to stay in the European Union on those terms but the British people throw it out and vote against him—surely it is unlikely that he would survive as Prime Minister. Therefore, we would be dealing with a new Conservative Prime Minister, presumably somewhat less Europhile than the present one, and the whole ball game would change in the negotiations over Article 50, if we decided to go down the Article 50 route. Surely, though, we are in a position to say that we are not going to do that. Our position is so strong that we require our own free trade agreement. I do not want to follow the Norwegian/European Economic Area red herring anymore, because none of us has ever wanted to do that. How does the noble Lord react to that position, with a Prime Minister who has gone, a new Conservative leader who wants to get on with it, and a European Union that perhaps will not be as recalcitrant as the noble Lord hopes?

[Lord Hamilton of Epsom (Con)]

I am grateful to the noble Lord, Lord Green, for telling us that the noble Lord, Lord Kerr, drafted all this legislation. I think he should have declared an interest, because the last thing he will want to admit is that the EU is going to completely override everything that he drafted. When the eurozone was set up, I remember it was thought that there would be a big problem if Governments borrowed excessively and cumulative debt built up to very high levels of GDP, so limits were put in on how much Governments should borrow in the eurozone. The Germans found that too inconvenient, so they just overrode it. Then the French followed, and everybody else said, “If they are not going to follow the rules, why should we bother?”. So why are we obsessed with the legislative integrity of Article 50? It has never been tested; no one has ever left the EU. If we were to leave, it would be a unique situation. They would be losing their second biggest economy, and they would have to accommodate us.

Let us remember another thing that the noble Lord, Lord Kerr, omitted to tell us. This referendum will be advisory, not mandatory, and that is very significant.

[Lord Kerr of Kinlochard]

My Lords—

[Lord Hamilton of Epsom]

I shall give way in a moment. All we have to do in response to a leave vote is repeal the 1972 Act. After that we have to enter negotiations, and we can apply for Article 50 at the end of the negotiation.

[Lord Kerr of Kinlochard]

I think it is not for me, but for lawyers, to discuss what would ensue were we immediately to repeal the 1972 Act. I do not think it is a pretty picture, but it is not for me to depict it. On the noble Lord’s argument that we would have all these cards in our hand, I was trying to extend an olive branch to him earlier. There is a point that nobody would want us to go—that is correct. The Germans would want to go on selling cars, as the noble Lord, Lord Hamilton, reminds us almost daily.

My argument is that it might prove difficult to get 27 member states, many of which have a negative trade balance with us and not all of which are as friendly to us as our friends in Germany, to agree all the detail. The noble Lord, Lord Green, is right: the process could be prolonged and quite tricky, and the country should know before the referendum that that is the case.

[Lord Hamilton of Epsom]

We come back to the point that was made earlier by my noble friend Lord Lamont: all this is down to interpretation. There is no fixed thing that is going to happen, and we do not actually know how it will map out, but it seems highly likely that the EU will do everything it possibly can to accommodate us. The Germans are going to be very distressed if they lose all their exports to the UK, and I know they will be very much in the driving seat to ensure that the other members of the EU abide by some sensible agreement. I see no reason why there should not be a free trade treaty between us and the EU. I am not saying that it will happen tomorrow, but then for that matter that is true of all the EU trade treaties; they seem to be taking an interminable amount of time with China, India, Russia and practically every other country in the world.

[Lord Stoddart of Swindon (Ind Lab)]

My Lords, I am sorry if my remarks offended the noble Lord, Lord Kerr, or made him a bit unhappy. I would not do that for the world; not only do I like him but I respect him and understand his expertise in these matters. However, I still have a difference of opinion with him, although quite frankly I would be quite happy if his amendment were accepted. If the EU behaved as he was intimating earlier on, it would help my cause. It would show that the EU, instead of being a partner, was in fact rather spiteful if, after the British people had voted a certain way, instead of accepting it with good grace the EU would want to be spiteful and put obstacles in the way of agreements that we could make outside the members of the EU. We ought to take that into account.

I return to the original contention, which is this: whether this is a binding referendum or some other sort, I do not know, but if the people have spoken then they will have to be listened to. There is no question about that. It is not a question only of the Government listening; it is more about Parliament listening. It is Parliament that will have to take action after the people have spoken, and the action it must take is to repeal the European Communities Act 1972. Once it did that, everything would fall into place; after the repeal it would then have to embark upon negotiations.

I think that the Vienna convention governs the unmaking of treaties. We would be acting within the Vienna convention if we adhered to the two-year period of negotiation and, after that time, either accepted the agreements that were made or not. Basically speaking, though, once the people have spoken, if they have said that we are to come out, no treaties or conventions will prevent this country coming out. If this Parliament decided otherwise, there could be a revolution.

I hope that I have made clear what my view is and that the noble Lord, Lord Kerr, is now unoffended. If his amendment is accepted, I am quite sure that later on we can make use of it.

[Lord Mackay of Clashfern (Con)]

My Lords, I am quite tempted to intervene in this debate. We had a full discussion of this issue, as noble Lords who were there will remember, when the European Union Referendum Act was being discussed here. The question arose of the basis on which European law applies in our country. The answer is clear: the 1972 Act makes European law the law of this country. We could get rid of that immediately by repealing the 1972 Act, but under international law we are also members of a treaty organisation. If we are going to observe international law, which on the whole I hope we would want to do, then we would have to go through the proper procedures for renouncing or denouncing a treaty. That is the next stage in the matter. It is clear that the law would no longer apply in this country as a domestic law, which is the result of the 1972 Act, once Parliament decided to repeal that Act. I think that that would be true of all the European law that has come in since 1972. None of it would apply here any longer, but the treaty obligations would apply and we would be obliged to follow the mechanisms laid down in international law for denouncing a treaty.

[Lord Hamilton of Epsom]

Before the noble and learned Lord sits down, would he accept that what has actually happened is that EU law has been enacted into British law? Anything that has been passed down from the EU is therefore on the statute book of the British Parliament, and therefore that would continue.

[Lord Mackay of Clashfern]

No, because that is all done under the authority of the 1972 Act by subsequent amendments under it. We had a lot of discussion about this last time and I do not want to start that up again if I can avoid it. Some of the devolution statutes had reference to Acts, for example, but they all flow from the 1972 Act. That Act is the authority for applying European law in the UK. That is why the courts of the UK are obliged to follow it because that is the law laid down by the Parliament of the UK. If that law were repealed, it would become a question of international law, and the rules of international law do not apply to domestic law except in so far as they are incorporated. It is only then as treaty obligations that the state proceeds thereafter.

--- Later in debate ---

[Lord Davies of Stamford (Lab)]

My Lords, I rise to speak, not that I intended to do so, because although we have been going over the same ground this evening that we have gone over before, and although no doubt many of these points will be debated passionately during the referendum campaign, I had rather hoped that the effect of these debates would be to separate out a bit the wheat from the chaff in the arguments and that those arguments that were found to be obviously unviable would be dropped by the various parties before the referendum campaign started. Therefore we would have a function here of hoping to clarify some of the essential arguments before the public debate begins in earnest.

In that context, I am quite amazed and very disappointed that two grossly invalid arguments continue to be put forward by the Eurosceptic representatives in your Lordships’ House. I thought that we might have seen the end of them. Those two arguments are so irresponsible and illusory that it amazes me that men or women of the world can seriously want to take them any further, even on an electoral platform, where I know the same qualities of intellectual analysis are not always deployed as they are in other contexts in life.

The first argument is the suggestion that this country might simply walk away from an international treaty in breach of that treaty. We have a long tradition going back over centuries of respecting international agreements, and it would be quite extraordinary for us seriously to propose to do that. We all know that Article 50 of the treaty of accession has a precise procedure to be adopted in the event that a member state wishes to withdraw; therefore withdrawal was properly and reasonably discussed at the time we signed that treaty. There was no material non-disclosure of relevant information or anything of that kind. No one was under any illusion. We signed that treaty with open eyes. Now, 40 years later, or whatever it is, suddenly to turn round and say, “We’re tearing it up and walking away”, is extraordinary.

I am amazed that anybody thinks that this country should behave like that. I would have thought that even those who are not influenced by the element of principle in this matter, which seems very obvious, or who cannot estimate or appreciate the diplomatic value—the soft diplomacy and soft power value—of having the reputation we have had until now of being a nation that takes international agreements and international law seriously might at least from sheer cynical pragmatism have realised that the last and worst thing you want to do when you are about to engage in a difficult negotiation with a group of countries, with whom we would be having a difficult negotiation to try to restore some access to the single market with our former partners in the European Union, would be, on the eve of beginning such a complicated, difficult and important negotiation, to tear up a treaty that we had previously had with them.

[Lord Hamilton of Epsom]

Has the noble Lord not missed the point, which is that the key to all this is when you invoke Article 50? Do you do it at the beginning of the negotiations, when we have just voted to come out, or at the end, after two or three years?

[Lord Davies of Stamford]

My understanding is that from the very moment you initiate the process you invoke Article 50, which sets out the procedure to be followed. I have certainly read Article 50, and that is the way I read it. I do not think that any interpretation we have heard this evening, including from the noble and learned Lord, the former Lord Chancellor, is inconsistent with that reading. The fact is that we must act in good faith in these matters. If we do not act in good faith out of moral principle, we should do so out of sheer selfish pragmatism because we will need to get a deal with the people who account for about 50% of our exports in the event that we want to leave the present arrangements we have with them. The idea that we start off by breaking an international agreement solemnly entered into is quite extraordinary.

The second extraordinary thing—I have heard this argument before and I hope I will not hear it again, although I am sure I will; I expect that it will be in the Daily Mail every day during the campaign—is that because we have a balance of payments deficit with the rest of the European Union, we have more leverage on them in these negotiations than they have on us. That is complete nonsense. I dealt with this argument before, and I used an analogy, which no one quarrelled with at the time, to try to make clear that the fact of having a deficit or a surplus is neither here nor there. What is important is the proportion of one’s total exports and, behind that, the proportion of one’s GDP which is exposed in a negotiation of this kind and which could therefore be subject to something nasty happening to it, such as having tariffs imposed or no longer being able to be sold at the same favourable terms as competitors could offer the relevant customers. The proportion of exposure of gross domestic product, and the employment that goes with it, is important.

--- Later in debate ---

[Lord Lamont of Lerwick]

My Lords, the noble Lord, Lord Wallace, has made some very interesting comments. I learnt two things. First, I understand now why migration was not included in the review of competences. He explained that that was because the word used was “population”, whereas had one asked the question about movement of labour or migration, perhaps it would have been different. Secondly, the noble Lord made quite a persuasive case, on one ground, for the necessity of migration and the inevitability of a degree of migration. I found it interesting that he was a regular watcher of Migration Watch. I was fascinated to hear that. But the arguments that the noble Lord put forward are the very things that would be considered in the Government’s publication if the amendments in the name of the noble Lord, Lord Green, were accepted.

I was somewhat neutral towards the amendment in the name of the noble Lord, Lord Green, because I have been trying to argue that all these reports that have been called for are the issues that ought to be debated during the referendum campaign. But everybody else has been coming forward and saying we ought to include this and that. When I look at the list compiled by the noble Lord, Lord Hannay, of things that ought to be considered in the publication, the one thing that is obviously missing is migration. Why did the noble Lord, Lord Hannay, not say that the publication ought to include migration?

I have been converted to the amendment in the name of the noble Lord, Lord Green, both by the noble Lord, Lord Wallace, and the noble Lord, Lord Hannay. I wish the noble Lord, Lord Hannay, were here to support it.

[Lord Hamilton of Epsom]

My Lords, I, too, would like to say some words in support of the noble Lord, Lord Green. He says that we have to level with the public on this and I think that is absolutely right. Net migration into this country last year was 330,000 people. That is a very large number of people. I totally accept that perhaps only half of them came from the EU but this is certainly something that we have to address.

I am particularly interested, as was the noble Lord, Lord Wallace, in Amendment 27. I would like to know from my noble friend the Minister exactly what the mechanics are with regard to people who have come from outside as part of this refugee crisis into somewhere such as France, who then apply for a French passport, which then enables them to come to the United Kingdom under the free movement of labour. Can she fill us in about how this process takes place? This is obviously an extremely worrying aspect of these migration flows. At the moment we are in a position to say that we are not members of Schengen and we can probably do something not to have to accept any of these people. But of course, if they are given European passports, that is rather a different story. Can she give us an insight into her understanding of this process?

[Lord Collins of Highbury (Lab)]

My Lords, we do not support the amendments tabled by the noble Lord, Lord Green, mainly because, as the noble Lord, Lord Lamont, said, they are highly speculative, impossible to calculate, unpredictable, and not based on factual information that the Government have. Confusing the free movement of labour with migration and simply putting everyone in together will not lead to a rational debate.

The free movement of labour has been an important component of the EU. Certainly, people have come here to work. Where they have not come here to work, the Government have been addressing those issues in terms of the benefits system, as the Labour Party has also committed to do.

I have no doubt that in the course of this referendum campaign, the noble Lords, Lord Green and Lord Willoughby de Broke, will repeat what they have said. They will make this issue part of the referendum campaign and I will take great pleasure in making sure that other voices are heard in that debate which challenge some of the assumptions about migration. But for the purposes of the EU referendum campaign, it is wrong to confuse the free movement of labour with migration, and it certainly is not capable of being subject to a rational report.

--- Later in debate ---

[Lord Hamilton of Epsom]

My Lords, as far as I can see, the noble Baroness, Lady Morgan, has put her finger on a slight problem here. The Bill, as I understand it, allows some charities to become permitted participants and permissible donors. But at the same time, Charity Commission law basically says that charitable contributions should not be used for political purposes. I understand that Justice Hoffmann—now the noble and learned Lord, Lord Hoffmann—ruled in 1991 that:

“There is no doubt that campaigning, in the sense of seeking to influence public opinion on political matters, is not a charitable activity … it is not a proper object of the expenditure of charitable money”.

It seems that we have two conflicting judgments being made, one by the Bill and the other by charity law. It would be very helpful if my noble friend the Minister could cast a bit of light on this. Are we now saying that charities are to be allowed to involve themselves in campaigning, against the judgment of Justice Hoffmann? I am a little confused about where we stand on this.

[Lord Wigley (PC)]

My Lords, I am glad to have the opportunity to welcome the amendment put forward by the noble Baroness, Lady Morgan, because it touches on an area that could cause considerable confusion and difficulties to charities. I am involved with a number of them and have known some of the problems that have arisen in the context of elections. It is quite clearly not a question of campaigning in a party-political sense but, equally, charities have a viewpoint on changes that can affect their fundamental raison d’être. They need to be able to put forward information for people to consider without being seen as campaigning. That dimension is complicated by the difference in the legislation that exists in different parts of these islands.

This is clearly a probing amendment and I very much hope that the Minister will at least be able to come back at Third Reading on this matter, if not tonight. Before I sit down, I thank her very much indeed for the way in which she and her colleagues have handled the Committee and Report stages of the Bill, and the outcomes we have had from it.