European Union Committee: Report on 2013-14 (EUC Report)

Lord Hannay of Chiswick Excerpts

Thursday 24th July 2014 Lords Chamber

[Lord Hannay of Chiswick (CB)]

My Lords, annual reports such as the one we are debating today are all too easily dismissed as routine matters going over familiar ground. In this case at least, that would be a considerable error because the report we are considering reveals that your Lordships’ EU Select Committee has been breaking some interesting new ground, and has produced a report on the role of national parliaments in the shaping of EU policies and legislation which addresses an issue of major topical concern right across Europe and provides elements for reform that could be of real value in months and years ahead.

I begin by paying tribute to our chair, the noble Lord, Lord Boswell of Aynho, whose patient and perceptive leadership contributed so much to the work of the committee in the period we are discussing, and to my former colleagues on the committee, from which I stood down in May.

I shall say a short word about the new ground. We have all become aware through our work on EU issues that too often the valuable scrutiny work of national parliaments comes too late to have much influence on the final outcome. Too frequently, the proposals on which we comment are pretty well set in concrete by the time our views are known. To be fair to the Commission—not an entirely fashionable thing to be on this side of the channel—it has been saying for some time that it wishes that national parliaments would intervene more upstream of it making formal proposals. Vice-President Šefcovic said that to COSAC last autumn. We agree and we have begun to do that, for example, in a report that my sub-committee produced on the strategic objectives for justice and home affairs, which we debated on 22 July to reasonably good effect, since the decisions reached by the European Council on 27 June bore a striking resemblance to the recommendations that we made. Another example of new ground being broken is instances where we question whether the European Union is taking seriously a really important Europe-wide challenge. In this case, I refer to the report on food waste, which the noble Baroness, Lady Scott, produced and to which she referred. Let us hope that all EU institutions will study that report with care and will draw some conclusions on how best to reduce that shameful waste.

I want to concentrate most of my remarks today on our report on the role of national parliaments, an issue that I am glad to say figured on the strategic agenda for the European Union’s next five years, which was adopted by the European Council on 27 June. It said that the credibility of the Union will benefit from greater involvement of national parliaments. That is precisely what we said in our report. Now they need to get down to it and do it. Our report contains a large menu of possible reforms to that effect, which would not require the complexities and pitfalls of treaty change. I will discuss a few examples.

First, there is the yellow card system, under which national parliaments can submit reasoned opinions that argue that a Commission proposal has not met the subsidiarity criteria in the treaty. That is clearly not working as well as it should. It is not hard to see why. The eight weeks provided for the submission of reasoned opinions is grossly inadequate—neither the Commission, the Parliament, nor the Council operates within such a short timeframe. Why on earth, then, do they think that national parliaments can and should? One of our suggestions is that the Commission should change the time limit to 12 or 16 weeks. That would enable national parliaments to consult each other and concert their views, which is virtually impossible under the present eight-week cut-off.

Secondly, there is clear evidence that the outgoing Commission has not been treating the yellow card procedure with respect and seriousness. The first time the yellow card was triggered over the Monti II proposal, the Commission withdrew its proposal but explicitly went out of its way to say that it was not doing so because the yellow card had been invoked. The second time it was triggered, over the proposed European Public Prosecutor’s Office, it resubmitted its proposal within three weeks, unchanged, and did not explain why it was doing so to the national parliaments, which had introduced reasoned opinions, until several months later. Presumably it took that time to work out why it had done what it had done within three weeks—not, frankly, a good way to handle things. It simply will not do. The new Commission, when it takes office in November, should make it clear that when a yellow card is triggered it will either withdraw the proposal or amend it substantially.

Thirdly, the Commission should make clear that it will, in future, accept that reasoned opinions can address the issue of the treaty-based principle of proportionality as well as the arguments about subsidiarity. The current distinction between the treatment of these two criteria is neither logical nor defensible.

There are plenty of other ideas in the menu we set out in our report on national parliaments: the possibility for national parliaments to initiate proposals—the so-called green card; ways in which COSAC could help national parliaments strengthen their scrutiny of draft EU legislation while respecting every parliament’s different procedures based on constitutional differences in each member state; the strengthening of links between national parliaments and the committees of the European Parliament, which often simultaneously consider the same Commission proposals; and the need for the new Commission to engage closely with national parliaments and be ready to give evidence to them.

The Government have certainly not hastened to respond to this report. They overran the two-month limit several times and were in fact two additional months behind earlier this week when they finally produced their response. Clearly, they did not find it easy to make up their mind. However, this issue of the role of national parliaments is a crucial part of the positive reform agenda which the EU as a whole needs to grasp and press forward. Perhaps the Minister when he replies to this debate will be able to throw some light on the Government’s thinking and how they intend to carry the matter forward. In any case, we will in due course be able to debate the matter fully on the basis of the EU Select Committee’s report on national parliaments and the Government’s somewhat belated response.

This evening, I will make only one remark about the Government’s response, which can perhaps be regarded as a taster for the full debate to come. In their introductory response, the Government stated flatly that,

“the real source of democratic legitimacy in the EU lies with national parliaments and national governments”.

Throwing down the gauntlet to the European Parliament in this way is tactically crass and strategically wrong. How on earth can one say that a parliament elected by universal suffrage is not a—I do not suggest it is “the”—real source of democratic legitimacy? Your Lordships’ Select Committee made no such claim. Indeed, we made it clear that in our view national parliaments and the European Parliament shared the task of shaping EU legislation. If the Government wish to ensure that any proposals they make for strengthening the role of national parliaments are dead on arrival, I can think of no better way of doing that than organising a food fight between national parliaments and the European Parliament. There is, after all, no good argument than cannot be spoiled by exaggeration.

--- Later in debate ---

[Lord Wallace of Saltaire]

We all understand that that is part of the problem and the pressure, and we are doing our utmost to look at that as well. I also take the point made by the noble Lord, Lord Hannay, that effective scrutiny necessitates the earliest possible engagement with developing areas of policy, looking at work programmes and strategic views.

I am glad that the noble Lord, Lord Boswell, feels that the Government’s scrutiny performance has improved somewhat in the last year. It is one of those things on which we all have to maintain the pressure. Civil servants are always very busy and Ministers always have too many things in their in-tray, but we have to keep up the pressure on all that.

The noble Lord, Lord Bach, asked whether the Government’s evidence on the abuse of free movement rights could be shared with the House. Much of that is in the free movement of persons paper that was published on Tuesday. Having been very closely involved in negotiations over that paper, I might say that the evidence is not always entirely clear; that is part of the problem in discussing questions of free movement of persons and labour and the abuse of free movement rights. That is partly because we do not have exit controls in this country and partly because we do not collect all the central evidence. For example, I questioned at one stage an academic study that suggested that there were 40,000 British citizens receiving benefits in other states in the EU. That is an academic estimate, but nobody is entirely sure whether that is an exact figure. So there are many problems in addressing that very complicated issue.

The noble Earl, Lord Caithness, asked whether the UK had been diffident in its approach to the financial transaction tax. The Government have been very closely engaged with this issue since publication and, indeed, took a case to the European Court of Justice on that issue to raise the question of how far it would be appropriate for the European Union to move on that subject. We remain actively engaged.

The noble Lord, Lord Tugendhat, talked about the Transatlantic Trade and Investment Partnership. That will be a central but extremely difficult issue for the coming year; we know that there will be lobbies not just in France and elsewhere but in this country that will want to raise negative issues about TTIP. That is something that we will clearly have to follow.

May I say, as spokesperson for the Cabinet Office and therefore dealing with a lot of data sharing issues, that I would welcome the European Union Committee looking further at aspects of the digital single market as well as data sharing and data protection? Some months ago, I asked for a briefing within Whitehall on the digital single market and officials from five different departments came to brief me, demonstrating just how complicated an issue it is. After all, this is all one issue in a complex, multi-levelled set of issues for government that is driven by the speed of technological change. I am constantly struck by how much faster technology is taking us down the road to online, cross-border transactions than we previously understood. The digital single market is a major priority in the Government’s drive for EU reform and it is part of the extension of the single market to services, as services and manufacturing intertwine and overlap. It will be a difficult issue also in TTIP, as data regulation, the cloud and the role of the US service providers hit the issue of data protection.

I am conscious of the time. I hope that I have answered most of the issues, but I see that there are one or two questions still to come.

[Lord Hannay of Chiswick]

Before the Minister sits down, I understand why he is in some difficulty in addressing the point that I raised about the claim that national parliaments are “the basis” for real legitimacy in the European Council, not in the European Union, not “a basis” for it. Of course he cannot take back the words that, alas, have been written in the response to the national parliament role report, but we are going to debate it again and I hope that he will report back to his colleagues the dangers they are taking if they turn the question of strengthening the role of national parliaments into a contest with the European Parliament. They will not get anywhere if they do that. It has to be pursued as a matter in which both national parliaments and the European Parliament have a role in assuring the democratic legitimacy.

[Lord Wallace of Saltaire]

I very much take that point. The new European Parliament is a rather more difficult body with which to co-operate than its predecessor, but I think it is extremely important nevertheless that we do co-operate. I am in the middle of making arrangements to go out myself with one or two others in September to talk to new Members of the European Parliament, British and others, with whom, of course, we must co-operate.