European Union Referendum Bill

Debate between Lord Hamilton of Epsom and Lord Kerr of Kinlochard

Monday 23rd November 2015 Lords Chamber

[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.

European Union Referendum Bill

Debate between Lord Hamilton of Epsom and Lord Kerr of Kinlochard

Wednesday 4th November 2015 Lords Chamber

[Lord Kerr of Kinlochard]

Actually, you are a member while the Article 50 negotiations are proceeding. You are a member of every council. Your MEPs do not leave the European Parliament, your judges do not leave the court and your Commissioners do not go home. The only difference is that in the Article 50 negotiations you do not have a vote on the position of the EU—the position that it has in its negotiation with you. That is all. You remain a member throughout the period of the Article 50 negotiations unless you decide unilaterally to go home. You do not have to do Article 50 at all. If you want you can just stop paying the bills, stop turning up at meeting and in due course it will be recognised that you have gone. It is not the case that once you invoke Article 50 you are no longer a member of the European Union.

[Lord Hamilton of Epsom (Con)]

Surely the key to the decision taken in the referendum is that it is advisory and not mandatory, so therefore it would not be necessary at once for the United Kingdom to apply for Article 50. We could merely carry on with the negotiations with absolutely nothing changing whatever.

[Lord Kerr of Kinlochard]

Technically, that is correct. It is advisory. But it seems to me that anybody who thinks that the Government could do other than act fairly quickly on the advice they had received from the entire country is in cloud-cuckoo-land. The noble Lords, Lord Forsyth and Lord Hamilton, are right in a sense in that our influence in the councils of the European Union would go into very rapid decline. We would still be there but we would not be listened to a great deal if we were heading for the exit door. That is certainly true. However, we would be members, and the idea—with all respect to the noble Lord, Lord Hamilton—that the Government might consider whether they were going to act on the advice of the country or going to try some form of new negotiation is nonsense. If the country votes to come out, we come out.

European Union Referendum Bill

Debate between Lord Hamilton of Epsom and Lord Kerr of Kinlochard

Monday 2nd November 2015 Lords Chamber

[Lord Kerr of Kinlochard]

I am afraid I do not work in the British Government and do not have the statistics to hand. However, it is the case that a large member state such as the United Kingdom, with a voting weight proportionate to its population, has a considerable say in EU legislation. An EEA but non-EU member state, such as Norway, has none whatever.

[Lord Hamilton of Epsom (Con)]

Can the noble Lord explain the free trade treaty between the EU and South Korea? Does it bind South Korea to following all EU legislation?

[Lord Kerr of Kinlochard]

I had assumed that the principal interest of the noble Lord, Lord Hamilton, was making sure that we managed, as some sort of country member or associate, to remain within the single market. The Koreans have no such rights. They have a very good free trade agreement, which is greatly in the UK’s interest, and has produced a considerable increase in UK exports to South Korea.

There is no doubt that the UK could secure a free trade agreement with the EU. That is not an issue. But if we want access to the single market, we need more than a free trade agreement. That is why the Norwegians are in what is known as EFTA and the EEA and why they are complaining about their relations with the EU.

The noble Lord, Lord Forsyth, told us that nobody in Norway wants to join the EU. Actually, the entire Norwegian establishment would like to join the EU but has not, as yet, managed to persuade the Norwegian public of that.

--- Later in debate ---

[Lord Kerr of Kinlochard]

The impetuosity of youth is spreading all around the Chamber. The point will be addressed in a second.

If we had no structured relationship with the EU and operated purely as WTO members, the damage to our exports and inward investment would come more quickly, since UK exports to the EU would become subject to EU tariffs straightaway—10% on cars, 15% on food products and so on. We would also lose the benefit of the EU’s 200 or so trade agreements with third countries and regional groupings and we would need to negotiate our own.

Maybe there is too much Nordic gloom and doom in my analysis. Maybe the noble Lords, Lord Forsyth and Lord Stoddart, are correct. Certainly, that great Scottish economist, Peter McKay, writing in today’s Daily Mail, finds my analysis defeatist, but it is possible that the Norwegians know what they are talking about. Maybe we could, to address directly the point of the noble Lord, Lord Stoddart, secure a new sui generis deal more generous than any that the EU currently has with anybody. Maybe we could forget all these models and establish the new Union Jack model. It is true, as the noble Lord, Lord Hamilton, says, that we would have some cards in our hand. Some 6% of exports from the rest of the EU come to us and we could threaten to cut them off, so pleasing Mr McKay in the Daily Mail, if not the British consumer. However, we need to face facts—four facts. First, 6% of their exports come to us—3% if one excludes the Netherlands, Germany and Ireland—but nearly 50% of ours go to them. In a protectionist showdown, we would be shooting uphill. They would be facing a blip; we would be fighting for our lives.

[Lord Hamilton of Epsom]

The noble Lord talks about a blip. We are talking about 4.5 million Europeans losing their jobs, on top of the astronomically high levels of unemployment they have now. If that is a blip, I am very glad that the noble Lord does not advise me on economics.

[Lord Kerr of Kinlochard]

I do not recognise the figure of 4.5 million. Maybe the noble Lord is assuming that exports that did not come to Britain, because we erected a protectionist barrier against them, would not go somewhere else in the world. It is a static analysis.