EU Referendum: Assessing the Reform Process (EUC Report)

Lord Kerr of Kinlochard Excerpts

Tuesday 3rd November 2015 Lords Chamber

[Lord Kerr of Kinlochard (CB)]

My Lords, I welcome the report with all the enthusiasm of a former member of a team who, sacked by the manager and sold by the proprietor, hears that the team is still winning. My enthusiasm is enormous.

I thought that the noble Lord, Lord Hamilton, showing all his customary understatement and finesse, was a little hard on the report. To even things up, I thought I would be hard on the Government’s response to it. It reminds me of the story of the old lady who said that she had greatly enjoyed “Hamlet”—it was full of quotations. The Government’s response seems to me to consist only of quotations of things said previously by the Government. I look forward to the Minister’s reply, in which I suspect we may hear some of them again. However, I hope that none of them will descend to the level of the first substantive point made by the Government in their response to the committee of the noble Lord, Lord Boswell:

“The Government has been clear that the outcome of the renegotiation will determine the timing of the referendum”.

I have never been in doubt about that but it is good to be reassured.

I want to make a couple of points about process, because the report is basically about process. The committee says at paragraph 69 that it found some of the foreigners a bit concerned at not knowing precisely what we want. The report is dated July. They may not perhaps be much the wiser now, but next week the famous letter to Mr Tusk may tell them. Actually, I thought that the Chancellor of the Exchequer’s speech to the BDI today told us quite a bit. In the passages that dealt with what seem to be much the most intellectually difficult and complex problem in the negotiations—the relationship between the euro-ins and the euro-outs—it seemed that what the Chancellor was suggesting to the BDI, although I do not know what he said to Mr Schäuble, was both reasonable and achievable. The noble Lord, Lord Lawson, suggested that it was a little unambitious—something about “reach and grasp” comes to mind—but “reasonable and achievable” is not too bad as an aim at this stage of the negotiations.

I admit that the process being followed is one I have never seen before. I worked for Mrs Thatcher, who had a rather different technique. Officials would be summoned and interrogated as to what the maximum was that we could possibly achieve. She would then publicly announce 120% of what the officials had advised. This was an excellent technique—it worked extremely well. For example, in the 1988 negotiation on the budget and the CAP, which started the process of bringing down the CAP as a proportion of the budget with the introduction of stabilisers on agricultural spending, in the end she settled with remarkable ill grace for 100%, denouncing her officials, her allies and her ministerial colleagues as feeble and wet. The foreign foe, defeated, went home able to say, “Well, at least we got 20% off her”. It was an excellent technique in my view.

I am a little worried about the technique of not saying what you want until you have established what you can get. From my point of view, it is a slightly unusual order in which to proceed. I suspect that real negotiations are going on—I know nothing—but that they are taking place on the basis of non-papers, without commitment and probably prepared not by British officials but by the admirable Council secretariat and Mr Faull in the Commission, to whom the noble Lord, Lord Boswell, referred.

That is fine, and it is rather the way that, in 1992, we, the British presidency, dealt with the Danish issue. It was a small circle and the Council secretariat played an important role, particularly the remarkable Mr Piris, then chairman of the Council’s legal service. But when we had the outlines of a deal, it was then spread EU-wide to successive meetings of the Committee of Permanent Representatives and then the General Affairs Council. Finally, when it went to the Edinburgh European Council, there were absolutely no surprises in it for anybody. Many had started out with suspicions—suspicions of the British for perhaps being in bed with the Danes, suspicions of the British for perhaps not wanting the Maastricht treaty to be ratified by Denmark. In the end, it was Mr Piris’s presentation of the text to the European Council, a well-prepared European Council, which saw the Danish problem solved and the Danes ratify Maastricht.

Blind-siding is always a mistake. The committee is absolutely right to say in the report that it has found some concern among other member states at not knowing what is wanted. It is really important that they should be brought in, because unanimity will be required in the European Council—that means Lithuania, Luxembourg, Slovakia and Slovenia just as much as Germany and France. Everybody has the right to feel that they have been consulted and their views taken into account. Blind-siding does not work. That should have become painfully clear to us in 2011, in the strange midnight disaster when the Prime Minister sprang a series of detailed demands on a European Council most of whose members are still not sure precisely what he was asking for, only to have the ridicule of Mr Sarkozy obliging Mr Cameron to walk out. Small circles are all very well, but well before an attempt is made to secure a European Council agreement, everybody has to be in some way brought on board.

It is perhaps worth noting that the deal that was struck for the Danes, like that struck for the Irish, did not involve either treaty change or a promissory note promising future treaty change—I mention this just as a footnote to paragraph 61 of the report. The texts that were agreed were common acknowledgements of statements the Danes made as to their intentions, and common interpretations—clarifications—of the treaty. They were legally binding. They took treaty form, in that at least one of them was registered at the United Nations as an international treaty, but they did not change the treaty of Maastricht, which meant that the ratification problems elsewhere did not arise.

I feel sympathy for the noble Lord, Lord Boswell, in his ceaseless attempts to bring the Government to account. This report is clear that it would be very good if the Government kept Parliament fully informed throughout. I understand that, but if I were in government, I would be doing exactly as the Government are doing. To be involved in a running commentary and a negotiation is not a good idea. If I were back in my old haunt as a faceless bureaucrat, I would be extremely anxious to avoid close parliamentary scrutiny of each negotiating move. I do not therefore criticise the Government. At some stage, they will have to tell the foreigners exactly what they want and they will have to widen the circle of those involved in the negotiation. But I would not myself be rushing to insist that at that point, we should cross-examine the Government as to their intentions. They will require flexibility.

I am sure that the reason why the Government are resisting the overtures of the noble Lord, Lord Boswell, has nothing to do with him. I am reminded of some of the noble Lord’s friends, possibly even the noble Lord, Lord Hamilton. It could be that they worry the Government. I am also reminded of the Duke of Wellington, not the present one but the great Iron Duke, when he said of his army in Spain:

“I don't know what effect these men will have on the enemy, but by God, they terrify me”.

Mr Cameron may well have that in mind.

--- Later in debate ---

[The Earl of Courtown]

I have some notes for later in my speech that will refer to that point, which the noble Baroness made in her speech. As far as withdrawing something that I did not put out in in the first place, I understand what the noble Baroness is saying, but I will write to her on that and put a copy in the House Library if possible.

The European Union Referendum Bill has passed through the other place and is now making its way through this House. The Prime Minister has already met with leaders of all 27 other member states as well as with the presidents of the European Commission, of the European Parliament and of the European Council to discuss the reforms that we seek. Technical talks have been taking place in Brussels to inform our analysis of the legal options for reform. There will now be a process of negotiation between all 28 member states, leading up to the December European Council. The Prime Minister will be writing to the President of the European Council to set out the changes that we want to achieve.

I will now address the points raised today. The noble Lord, Lord Boswell, asked a number of questions in his speech, which I will do my best to answer. He asked whether my right honourable friend the Chancellor is leading on this and how he interacts with the Foreign Secretary and the Prime Minister. The Prime Minister is leading the renegotiation, working closely with the Chancellor and Foreign Secretary, supported by the Minister for Europe and Cabinet colleagues.

The noble Lord, Lord Boswell, also asked about treaty change. The Prime Minister has been very clear in his discussions with other leaders that the reforms we are seeking must be legally binding and irreversible and that, in some areas, that will mean treaty change. There must then be agreement to those changes before the referendum.

[Lord Kerr of Kinlochard]

I congratulate the noble Earl. He has proved my prophecy correct. The last sentence that he read out is there in the Government’s response—the same clichés in the same order.

[The Earl of Courtown]

I thank the noble Lord for bringing that to my attention. The noble Lord, Lord Boswell, also asked about the role of the European Parliament. We will work closely with the European Parliament and recognise the important role that it plays in the European Union’s institutional architecture, for example as co-legislator for secondary legislation and in scrutinising trade agreements. My right honourable friend the Prime Minister welcomed President Schulz to the UK recently, and the Foreign Secretary has also met key players in the European Parliament.

The noble Lord, Lord Boswell, also raised the subject of the key interlocutors in Brussels. As I mentioned earlier, the Prime Minister has met all the leaders, as well as the President of the European Commission. The technical talks, led for the UK by the Prime Minister’s Europe adviser and UK Permanent Representative to Brussels, have been taking place in Brussels, and there will now be a process of negotiation between all 28 member states leading up to the December European Council. The Prime Minister will be writing to the President of the European Council to set out those changes.