European Union Bill

Lord Kerr of Kinlochard Excerpts

Tuesday 5th April 2011 Lords Chamber

Moved by

[Lord Kerr of Kinlochard]

1: Clause 1, page 1, line 12, leave out subsection (5)

[Lord Kerr of Kinlochard]

Roderigo in “Othello”, Flavius in “Julius Caesar” and Bernardo in “Hamlet”—the House will instantly recognise what these three guys have in common. They get to start the play, they are completely unimportant characters and they have no influence whatever on how the plot subsequently develops. Afterwards will come the captain and the kings—I see that the names of five former Cabinet Ministers are attached to some of the more than 60 amendments that we are to debate—and of the 37 speakers at Second Reading on 22 March, more than 80 per cent were fiercely critical of the Bill. However, Shakespeare knew that, as the house shuffles its feet and settles down, first up should be a very minor character. The Bill has caused considerable concern on all sides of the House and the soliloquies from the stars will be worth waiting for. I hope that the play will not prove a tragedy, but I am merely playing Bernardo.

I will not repeat what I said at Second Reading about why I thought that the scale of the referendum requirements in the Bill was absurd in conception and damaging in effect, given that the requirements are for binding, mandatory referenda with no threshold on issues, many of them very minor and on all of which by definition the Government and Parliament have agreed. Nor will I say anything today about why I fear the chilling effect on our negotiators and on the perceptions of us in other EU member states or about the risk that, if we enact this Bill in this form, we will be repeating the Messina mistake and isolating ourselves from the future development of the European Union—I think that that is a risk, but I will not dwell on it now. Nor will I explain again why I believe that this is a bad Bill, which would damage both parliamentary sovereignty at home and our national influence and standing abroad.

[Lord Davies of Stamford]

The noble Lord said that he would not say anything about the potentially damaging effect on our negotiating position or negotiating leverage if this Bill is passed into law. I was disappointed to hear him say that, because there are few people in the world who have greater experience of negotiation in Brussels than he has. Does he agree that, when you are negotiating in any context in life, you have a certain leverage if at the end of the day, when you are persuaded and you have done a deal, you can actually deliver? However, if it is known in advance that you cannot deliver because you need a referendum to deliver—the Government are obviously not going to have a referendum on some subject of tertiary importance—does he agree that you will not really have any negotiating leverage at all, because no one will make concessions to you in the expectation of getting agreement if you cannot give agreement in the first place?

[Lord Kerr of Kinlochard]

The noble Lord exaggerates my experience, but I think that he is quite right in his point. It is the case, I believe, that this Bill, if enacted, would oblige British Governments to oppose in Brussels reforms that were acknowledged to be in the UK interest, because they would not wish to have to face a referendum on the issue in this country. We are talking here not about big issues but about relatively minor reforms that most people in this House would find useful.

However, I do not want to be drawn any further down that track for the moment. What Bernardo actually says at the beginning of the play are words to the effect, “Midnight has struck; fly home to your bed”. We were after midnight when we finished Second Reading and I was rebuked fiercely from the government Front Bench for contributing to the length of our debate. Therefore, rather than going back over ground that I touched on then, I will concentrate on the amendment that stands in my name.

The amendment would delete the first reference in the Bill to Article 48(6), which concerns treaty revision procedures. I am sure that I do not need to refresh your Lordships’ memory of Article 48(6), which we could probably all recite—and perhaps should have recited before we began considering this amendment—but let me just recap for a second. We are dealing with two treaties: the Treaty on European Union and the Treaty on the Functioning of the European Union. The first, the TEU, is about principles, values and institutions; the second, the TFEU, is about the competences and, in its Part 3, the policies of the European Union, how those are to be determined and how they are to be implemented.

There are also two amending procedures. The first, the traditional procedure, involves an intergovernmental conference, which is now to be preceded by a convention of the kind on which the noble Lords, Lord Tomlinson and Lord Maclennan of Rogart, and the noble and learned Baroness, Lady Scotland of Asthal, served in 2002-03. That is the principal means of reforming the treaty. The second procedure is a simplified means—this is what we are talking about in Article 48(6)—which allows the European Council, or heads of Government, to decide without a prior convention or intergovernmental conference. Both means of course require absolute unanimity among the heads of Government of the member states and both means require ratification by member states by whatever means they choose. Since the treaty is a treaty and does not purport to lay down how we handle our domestic affairs, it says nothing about how we or anyone else goes about ratification.

So why are there two methods? The difference between the two methods is that the simplified procedure cannot be used to amend the Treaty on European Union—the treaty about principles—nor can it be used to amend the part of the Treaty on the Functioning of the European Union that is about the competences of the Union. It follows that Article 48(6), reference to which is what my amendment suggests be removed from Clause 1, cannot be used to effect any transfer of competences or powers from the member states to the Union. Adding belt to braces, it actually says that. Article 48(6), after referring to the previous steps in the process, says in its last sentence that the decision referred to in the previous paragraph,

“shall not increase the competences conferred on the Union in the Treaties”.

This article is not about the famous or infamous passerelle; that is something completely different, dealt with in Clause 7. We are talking about Article 48(6), which is covered in Clause 3. The question for me is: why is it there? This is the question that my amendment is designed to probe.

I may have misunderstood something, as the Bill is extremely densely drafted and hard to construe, but I listened carefully to what the noble Lord, Lord Howell of Guildford, said in his elegant and thoughtful speech at Second Reading and I confess that I am still puzzled. I am also now a little worried. In introducing the Bill, the noble Lord, Lord Howell, described its primary purpose. He said that,

“where a treaty change is deemed to transfer competence or power from the UK to the EU, it will in principle require the approval of the British people in a referendum”.

After explaining very helpfully how Clauses 2 and 3 are concerned with the ordinary treaty revision procedure and the simplified revision procedure, the noble Lord went on to say:

“Both clauses also provide that, where a treaty change of either type would also transfer power or competence from the United Kingdom to the EU, such a change should also be approved by the British people in a referendum”.—[Official Report, 22/03/11; cols. 600-02.]

That is, indeed, an accurate description of the Bill, but it seems to me to reflect a misreading of the treaty. Article 48(6) cannot be used in a way that would transfer any competence or power from the UK to the EU. Therefore, it seems to me that the references to Article 48(6) and simplified revision procedure in the Bill are otiose. The only other explanation for them could be that the Government envisage referenda on EU issues where no transfer of powers or sovereignty is envisaged.

What did the Minister mean by a treaty amendment “of either type”? A treaty amendment is a treaty amendment is a treaty amendment. You amend the treaty whatever the process that leads you to the amendment, so what are we talking about? Why are we distinguishing a subset of treaty amendments? There are lots of other things with which I disagree in the Bill, but on this minor technical point I see no reason for any specific provisions in relation to Article 48(6) other than, possibly, the parliamentary ratification procedures. However, that is not what the noble Lord, Lord Howell, was talking about.

It follows that I see no need for Clause 3 or for the specific reference in Clause 1, which is the subject of the amendment standing in my name. In moving the amendment, I seek enlightenment. I apologise for troubling the House with these arcana; they are arcana, but the arcana are in the Bill and that is very troubling. Exit stage left.

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[Lord Pearson of Rannoch]

My Lords, perhaps it is time to have the smallest voice against these amendments. I shall do so by commenting on what noble Lords who have spoken so far have said. Can the noble Lord, Lord Kerr, tell us of any treaty changes so far that have not actually conferred power? I do not much like the word “competence” because it implies someone doing something competent, whereas we know that the European use of the word “competence” means power, which is nearly always exercised with great incompetence.

[Lord Kerr of Kinlochard]

The answer is “legion”. The appointment of judges to the European Court of Justice requires an intergovernmental conference, as does a change in the number in the European Parliament, and a treaty change is required in both cases. The answer is “legion”, I promise the noble Lord.

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[Lord Howell of Guildford]

Labour did not oppose the Bill overall, but it certainly urged that we should scrutinise it and that, by heavens, is what we are doing. No doubt we will be doing a good deal more of that.

With this legislation, we are, in our view, plainly acting in the spirit of the Laeken declaration, which noble Lords will remember urged that we should seek to find ways, which are widely recognised throughout the whole of the European Union, not just in this country, to bring the processes of the Union and its legislative procedures closer to the people. That was 10 years ago. It urged us to act on that basis. It seems to me timely—if anything, a little tardy—and certainly appropriate for the era in which we now live that we should bring forward legislation on which, we hope, we can build an architecture of faith and commitment to the European Union for the future and a building that we hope will last although, obviously, we would not like to see—we will be debating this later—future Governments remove the foundation stones from that architecture and destroy it. That would be a pity, but it will again be a matter of opinion and debate. The Bill is put forward with that kind of faith and intention in our minds. Frankly, calling it a fraud on the public is a deeply regrettable statement—deplorable, in my view—and not at all in line with the tone of debates in this House of Lords. I think that it is a pity that people should speak in that way.

I want to come to the core issue in the debate. The simplified revision procedure allows the European Council to decide to make amendments to the part of the Treaty on the Functioning of the European Union that concerns internal policies. That is what the noble Lord, Lord Kerr, stated quite clearly. This is the Article 48(6) issue. The noble Lord said that the treaty changes under the simplified revision procedure are not allowed to transfer further competence from the UK to the EU. Here I hesitate, because I am going to challenge the viewpoint and authority of the noble Lord, Lord Kerr, and many others, but certainly the noble Lord, Lord Kerr, who is a great expert. After all, he was, I understand, rapporteur of the European constitution, which came to, I am afraid, a sticky end, but he has vast expertise. However, it is possible to transfer further powers from this country to the institutions of the EU. The potential for a substantial amendment to be made under this mechanism means that we should treat, logically, changes under the simplified revision procedure in the same way as we would treat other types of change. I was challenged again and again about what sort of things are involved. I have a long list of powers in the past, present and future that will be affected by the transfer of powers.

[Lord Kerr of Kinlochard]

Could the Minister give us some examples? I cannot think of examples of transfers of powers that do not involve a change to the treaties. Can he explain what these transfers are?

[Lord Howell of Guildford]

I was in the midst of saying that I would do that. Article 48(6) can be used to amend Part 3 of the TFEU, which covers Union policies and internal actions, such as the internal market, agriculture, freedom, security and justice, competition, employment, the environment and public health. In the past, the Lisbon treaty agreed to move 51 vetoes from unanimity to QMV. Somewhere I even have a list, which I shall secure in a moment, of the kind of vetoes, emergency brakes or moves to compel the United Kingdom to do something new or a new power or sanction on the UK involving a treaty change that might or might not qualify under paragraphs (i) and (j) of Clause 4(1) as significant, might or might not be exemptions if they did not affect this country and might or might not therefore become one of the items that might lead to a legislative treaty ratification process that might require a referendum. That is the situation.

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[Lord Howell of Guildford]

I have given some examples from the past and I have some more here. There have been 51 vetoes to unanimity, most of which would have failed a significance test, would have been exempted, would not have applied to this country or would have had no influence on our affairs. I am advised that another past example of a transfer of power is when the Court of Justice was given the new power to impose fines on member states for non-compliance in specific areas. Were that to have been proposed in an area under Part 3 of the Bill or Article 48(6), it would represent a transfer of power which would have to be assessed over the tests in this Bill.

I want now to turn to the crucial implications.

[Lord Kerr of Kinlochard]

I think that the proposal to which the Minister was referring for giving a fining power to the court was originally proposed by the United Kingdom but I am more worried about the definitional point. I have not yet heard an example of a transfer of competence or powers—the words used by the Minister at Second Reading and again today. I hear about voting rules, and the Government can of course refuse to change the voting rules, but I have not heard about a transfer of power.

I do not think that any example yet given by the Minister is of a transfer of power; that is, something we give up. If the Court of Justice is given a fining power, no British court has a power to levy fines withdrawn. It is not a transfer. I agree that that may be an additional power to the Court of Justice but that is nothing about its competence. It is not a transfer of power if we are not giving anything up. We want the Court to enforce EU law.

[Lord Howell of Guildford]

I think that we have agreed that we are concerned with powers under Article 48(6) and the noble Lord is worried about powers rather than competences. It is true that the transfer of powers is not defined in European legislation, so we have to look at these detailed points, such as the surrender of certain vetoes or the removal of the availability to hold to a veto, and look at issues where a sanction is imposed on the United Kingdom which involves the limitation of a power moving to the higher levels of the European Union and taking it away from this country. These may be small powers. I want to come to what I believe to be a canard—that all this will lead to an endless series of referenda. It will not and I shall show exactly why it will not. But they are transfers of power and they come in a variety of forms. I have mentioned two or three. I will seek to get a longer list as we discuss these things but the pattern is there. The pattern of power must be considered as well as the pattern of competences.

Let me address what lies behind the amendment and the worry about Article 48(6); namely, will this procedure as applied to the transfer of powers as well as to the transfer of competences which would trigger the referendum requirement, provided they got over the significance hurdle, the exemption hurdle and other hurdles, lead to numerous referendums on trivial issues? If it did, I think that I would agree with some of the rather cruder and blunter criticisms of the Bill that this would not be a sensible way to proceed, with constant concerns about quite small issues triggering a referendum for the whole United Kingdom. Clearly, that would be absurd.

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[Baroness Anelay of St Johns]

My Lords, of course I do not seek closure. I know that my noble friend has been very generous in his winding-up remarks and that noble Lords have been keen to intervene to achieve elucidation. These are indeed very important matters. I appreciate that we are now reaching two hours, 48 minutes. We do not have anything by way of a guillotine in this House, but we have self-regulation. I believe that it is the sense of the Committee that it would be right for the mover of the amendment to respond now to the position put by my noble friend Lord Howell.

[Lord Kerr of Kinlochard]

I am grateful to the Minister for his considered reply. I strongly agree with his point about public disquiet and concern. Particularly in this House, we underrate the extent to which public opinion has moved against the European Union in recent years. However, the Bill will do absolutely nothing to remedy that concern and disquiet. What we need to do, and this is a responsibility particularly of the Government, is to be out selling in public the truth about the European Union. However, I agree with the analysis that the Minister provided at the outset of his remarks.

He was also quite right to range widely before focusing on my amendment, because, alas, the debate had ranged very widely. I did not realise how many of the captains and the kings would come in and how much Sturm und Drang we would have as we ranged over the battlefield. Quite a lot of the debate was, as the noble Lord, Lord Richard, pointed out, technically a little bit out of order, but it was very interesting.

I have to disappoint one or two noble Lords who spoke in favour of my amendment—and I note that only two spoke against it, none of them from the government Benches. My disappointed comes from the fact that the scope of my amendment is extremely narrow. If the Government were to accept it, and I do not know why they do not, the particular procedures applying to treaty amendments that result from the simplified process would fall away and all treaty amendments would be handled in the same way. I do not know why Clause 3 is needed as well as Clause 2. I was not arguing today that nothing that is done by the simplified procedure should ever justify a referendum—that is my view, but it was not the argument that I was making today. My argument today was that there was no need for Clause 3 and no need anywhere in the Bill for any reference to Article 48(6). We need proper, substantive definitions based on the content of a treaty amendment—what it says, what it does—to decide how significant they are and whether there is a requirement for a referendum. I will probably be somewhere else on the spectrum of that debate from the Minister. You need to address the substance of the treaty amendment, not the process by which the treaty amendment was arrived at.

Clause 2 refers to: “Treaties amending or replacing TEU or TFEU”. The title of Clause 3 is: “Amendment of TFEU under simplified revision procedure”. If Clause 3 vanishes, the only procedure you would have would be that set out in Clause 2, and it would apply to all treaty amendments. I cannot see why the Government do not buy that.

The Minister spent a long time trying to persuade us that you could, under the simplified revision procedure, transfer competences to the European Union, despite the plain wording of Article 48(6) that you cannot transfer competences to the European Union by that root.

[Lord Howell of Guildford]

I hesitate to do to the noble Lord what has been done to me for the past two hours—constant interruption—but I did not say that. I was talking about transfers of powers. I conceded the perfectly clear point made by the noble Lord that transfers of competences under Article 48(6) are not possible because they are excluded in the treaty. We are talking about transfers of powers, which is a different matter. I described the kinds of powers and said that, in order to be comprehensive and logical and gain the public confidence, it is our belief that the procedure should cover the transfers of both competences and powers. That is what I said.

[Lord Kerr of Kinlochard]

My Lords, I fear I am still unconvinced. I do not understand these powers. Can we have a definition of powers? What do we mean by powers when we talk about the Bill? Most people seem to think that the powers of the European Union are the powers we have given it. Over there they are called les compétences de l’Union, which is badly translated back into English as competences. This is about powers; the two words mean the same. At least that is my understanding. If we are giving them a different meaning, fine—but let us have a definition.

My bigger point, however, is that this is a technical amendment designed to probe why we need to have a Clause 3—I cannot for the life of me see why—but the Minister did not address that point in his response. I am very grateful to him for considering the debate and responding as he did, but I am unconvinced. Although I am ready to withdraw the amendment today, I shall be back. For the moment, I beg leave to withdraw the amendment.

Amendment 1 withdrawn.

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[Lord Wallace of Saltaire]

I foresee that when we get to the debate on Clause 18 we shall have a great many discussions on the exact relationship between the judiciary and Parliament and parliamentary sovereignty. The time for that debate is not now but then.

[Lord Kerr of Kinlochard]

Does the Minister agree that the likelihood of judicial review is greatly enhanced by the creation of the significance test? In almost any case where Parliament does not wish to have a referendum because it has accepted the Government’s statement that the issue is not sufficiently significant to justify a referendum, that will be challenged in the courts. The issue will not be whether to go ahead and complete the process of ratification but whether or not to have a referendum. It will be a bold Government who decide to go ahead and complete the process before the court has ruled on the significance point. What is extraordinary is that we should create a system where we are going to invite the court into the middle of our legislative procedures. If we have not finished here in Parliament, we will have to suspend if the significance test is being challenged.

[Lord Wallace of Saltaire]

My Lords, my understanding, and I stress that I am not a lawyer, is that it is the ministerial judgment that is subject to judicial review and not the parliamentary decision. I will clearly have to consult before I come back on Report on the exact meanings at stake, but my understanding is that parliamentary decisions are much more robustly resistant to judicial review.