European Union Bill

Lord Wallace of Saltaire Excerpts

Tuesday 26th April 2011 Lords Chamber

[Baroness Falkner of Margravine]

Having heard the explanation of the noble Lord, Lord Liddle, I wonder whether my noble friend might be able to tell us whether the powers required by the ECJ, were any transfer contemplated, would be covered by the significance test. My understanding is that they would be.

[Lord Wallace of Saltaire]

My Lords, I welcome a debate in which we are discussing the amendment in front of us rather than having another Second Reading-type debate as I felt at some point this afternoon we were doing. I can see where this amendment and the other probing amendment in the name of the noble Lord, Lord Liddle, are going, but they are based on a fundamental misunderstanding of the purpose of the Bill. The Bill does not intend to tie a British Government hand and foot to prevent them co-operating within the terms of the treaty.

The coalition agreement accepts the Lisbon treaty. That is, after all, a major step forward. The Lisbon treaty includes a substantial extension of competencies. As the noble Lord, Lord Mandelson, said in his very useful speech before dinner, the task that the European Union now needs to pursue is to use effectively the competencies that it has to make good decisions and then to implement worthwhile policy within those existing competencies. I have been struggling, with this and a number of the other probing amendments that the noble Lord has put down, to discover what particular difficulties these will cause for the British Government.

The European Union, as we all know, has often preferred—or at least those enthusiasts and habitués of Brussels have—to spend time writing new laws and devising new institutions rather than getting on with implementing policies. Part of the hole that we now find ourselves in and the mistrust we have across the European Union is the result of 25 years of treaty amendment, from the Single European Act, through the Maastricht treaty, the Amsterdam treaty, the Nice treaty, the Convention and the Lisbon treaty. They have provided very substantial competencies for the European Union, many of which have not yet been used.

My noble friend Lady Hamwee produced a very interesting paper the other week on the number of powers that the previous Labour Government had acted to put into the law, which have not yet been implemented. There was this great feeling in that Labour Government that when something happened, you passed a new Act or created a new criminal offence. There is now, as a result, a huge list of things on the statute book that have not yet been implemented and which I rather hope that this Government will get around to repealing.

As far as the EU is concerned, there are now substantial competencies. There are a large number of regulations in force, many of which unfortunately have not been fully enforced or implemented. I am puzzled by what it is that one needs to do with the European Court of Justice for which Article 256—which I have read, again—does not provide the powers that we need. The noble Lord, Lord Kerr, has said—on at least one occasion and I think more often—that we will need to change the number of judges in the European Court of Justice, which will require a treaty change and therefore a referendum. My understanding on this—and I may be wrong—is that to change the number of judges on the court, which we all know is overloaded, would require unanimous agreement by Governments of the member states in an intergovernmental conference; but in terms of this Bill, that would not involve a change to the treaty and certainly not the provision of extra powers or competencies. Yet again, I fear we may be dashing off after a hare that is bolting rather faster than we did.

[Lord Kerr of Kinlochard]

The number of judges in the court is defined in the treaty. So changing the number of judges in the court requires an amendment to the treaty. There is no doubt about that. Whether that would require a referendum—which is the point that the noble Lord, Lord Howell, was debating with me before dinner—is another question. He may well be right: it depends on whether you view an increase in the number of judges as an increase in the power of the court. If you did, then, under this Bill, you would require a referendum; if you did not, then, under this Bill, you would not. However, it is certainly a treaty amendment.

[Lord Pearson of Rannoch]

Before the Minister replies, can I ask the noble Lord, Lord Kerr, whether, with his great knowledge of these matters, anything can be done about the quality of these judges? Is it not true that none of them would pass muster as a judge in even the lowest and least distinguished of British courts? Is there anything we can do about that under the treaty? Who decides it?

[Lord Wallace of Saltaire]

I think the noble Lord, Lord Kerr, is not going to answer. I had something in my notes about how the European Union attracts pedants and conspiracy theorists, but I thought I would not use that on this occasion. As the noble Lord, Lord Liddle, said, we all know that we are sometimes a little pedantic on this. I am a Eurobore of some considerable standing, having helped to write several textbooks on the subject and struggled each time to remember how the treaty articles have been renumbered and so on. We could go on for a great deal of time.

We have heard one or two conspiracy theories this afternoon and this evening. Noble Lords may be aware that I received an even better conspiracy theory today from Migration Watch suggesting that the increased migration under the previous Labour Government was a deliberate attempt to increase the ethnic vote, which would split down for Labour. That is an even better conspiracy theory than anything that I have ever heard from the noble Lords, Lord Pearson of Rannoch and Lord Stoddart of Swindon. I encourage the members of the Labour Party to have a go at that when they have appreciated it fully.

[Lord Stoddart of Swindon]

I do not think that I have ever said that. I have never accused the Labour Party of gerrymandering and bringing millions of people over here to vote for it. The noble Lord might have seen it in a newspaper but I have certainly never used it.

[Lord Wallace of Saltaire]

I apologise to the noble Lord, Lord Stoddart. I was in no way suggesting that his imagination had stretched that far. Perhaps I might return to the amendment because I hope that after dinner we are going to keep to each of them. My puzzlement on this one is that I see nothing in the Bill that cramps the powers and competences of the European Court of Justice to enforce compliance with European Union law. Her Majesty’s Government support an effective European Union—as did our predecessors, as the noble Lord, Lord Mandelson, said—and strongly support the better implementation of European Union law. We shall continue to do so.

[Lord Liddle]

There is a lot with which I agree in what the noble Lord, Lord Wallace of Saltaire, has said. I agree with the basic analysis: that the question is of how the powers of the Union, as granted by the Lisbon treaty, should be used. What the noble Lord glosses over in his defence, as it were, of the Government is that the Lisbon treaty covers much of the ground that we need to cover but this Bill is designed to cramp the flexibility that it contains. That is the fundamental issue which noble Lords from around the House are trying to address. We are saying: “Look, we're not asking for a mandate for vast new powers for the European Union. That isn't what the argument is about”. We are saying: “The Lisbon treaty? Fine—but there is flexibility within it. Why are the Government ruling out using that flexibility where we, as the United Kingdom, think that it is in our national interest and where the British Government support it?”. Those are the conditions which would have to be met.

I am not a great expert on the European Court of Justice, unlike other noble Lords who may be in the Chamber. However, in its analysis of that Court your Lordships’ own committee, under the noble Lord, Lord Bowness, pointed to the possibility of the need for some change in the treaty. We ought to be open to that possibility and to a little bit of give on this kind of thing. If the Bill is to have a less troublesome Report stage than it looks as if it might otherwise have, the Government have to find a way of accommodating the view that we need more flexibility on some of these more detailed provisions.

--- Later in debate ---

[Lord Wallace of Saltaire]

I am sure that the noble Lord knows Justice Scalia of the US Supreme Court well. Justice Scalia has argued on a number of occasions that no American court could ever give credence to international treaty law or to any international court because intrinsically United States law is superior to that of any other state or court—a fundamentally nationalist line that is familiar to us. I am sure that the noble Lord shares it from an English perspective.

I do not wish to pursue that much further. I merely wish to say that my puzzlement on this amendment and on those that follow is that there is considerable flexibility in the treaty that is now before us. It is not the aim of the Bill to tie the British Government or to repatriate powers. We have heard today, even from some of the people behind us on the coalition Benches, that the Bill is inadequate and that what they wanted was repatriation and a reduction of the powers. That is not what we planned. What we are asking for is a pause. Pauses are sometimes used to try to rebuild public confidence in a range of different policy areas and it seems entirely appropriate that, after the considerable extension of competence that the EU has been through over successive treaty changes, there should now be a pause.

We should draw a line under the conspiratorial suspicions and fears—the noble Lord, Lord Liddle, used the word “fears” about his views on what the Bill might have behind it, underneath it or somewhere in a back cupboard—that Brussels is going to slide things past us by saying, “Let’s work within the existing treaties for the foreseeable future and then, when we are absolutely clear that additional powers or competences may be needed, we will return to this process”. However, I hope that all Members of this House will agree that we have spent far too long with Governments and members of the European Commission and Parliament who love discussing institutional change—much more than they wish to discuss real policy outcomes. What we need to do now in the EU is to improve our real policy outcomes using the substantial amount of competences that we now share. I encourage the noble Lord to withdraw his amendment.

[Lord Liddle]

I shall of course withdraw the amendment at this stage. What I find puzzling, though, is that when the Minister reads the Bill he sees in it lots of flexibility and possibilities for dealing pragmatically with the challenges that arise but when I and other noble Lords, such as the noble Lord, Lord Kerr of Kinlochard, and the noble Lord, Lord Hannay, read the Bill we see real inflexibility and an attempt to tie a British Government down in a way that is contrary to our national interests. I urge the Minister to have another think about this. Although he is a highly intelligent man who knows a lot about the European Union, his perception of the Bill is not shared by some of the most formidable experts on these issues in the country. I hope very much that the Government will have another look at these matters when we come to Report. I beg leave to withdraw the amendment.

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[Lord Pearson of Rannoch]

My Lords—

[Lord Wallace of Saltaire]

My Lords, I fear that we have been following a number of hypothetical will o’ the wisps around here. We have heard, “It’s possible, it might be the case, we can’t think of an example but at some point perhaps the powers might prove not to be adequate. We haven’t used many of the powers and competences yet; nevertheless we might not have enough”. I remind the noble Lord, Lord Liddle—perhaps he even wrote it—of an article in the Telegraph in which David Miliband, our previous Foreign Secretary, said:

“One of the greatest blessings of the Lisbon Treaty is that it brings to an end institutional navel gazing ... the EU [will have] 10 years to prove itself”,

without further treaty change. That is where we are now. The noble Lord is insisting on standing improperly. Although I did not wish to give way, I shall give way to him once.

[Lord Pearson of Rannoch]

My Lords, I could speak to this amendment before the noble Lord sits down, but if he is going to reply to the debate, it might be convenient if he hears what I have to say on this amendment. I think that that is in order.

I oppose this amendment, and I am afraid that I have to go further and say that I am not among those who think that the single market has been an undiluted success for this country. I shall be speaking in much greater detail to that fact under Amendment 41, so I will not detain your Lordships long this evening.

I am also aware that there are dying embers in the Conservative Party—shared by the noble Lord, Lord Davies, no doubt from his time on those Benches—which hold that the single market is one of the Conservative Party’s greatest achievements. I can deal with a few facts briefly to show that the single market has been a disaster for this country. You only have to take the report of the Treasury, Global Europe: full employment Europe, signed by Mr Gordon Brown himself, which estimated that EU overregulation, which comes to us entirely thanks to the single market, costs us some 6 per cent of GDP per annum, or £84 billion a year. It handicaps our exporters, and what we are about to see hitting the City of London from the new supervision bodies coming from Brussels under the single market will clearly be disastrous.

Then there is the very simple point that only 9 per cent of our GDP goes in trade with clients in the European Union; 11 per cent goes to the rest of the world and 80 per cent stays here in the domestic economy. Yet, 91 per cent—everything in the domestic economy that is exported overseas—is controlled by the single market.

[Lord Wallace of Saltaire]

My Lords, I gave way to what I understood was an intervention from the noble Lord. He previously gave no indication that he wished to speak to this amendment. I had certainly not seen him and I was looking directly at him. I think that he is being discourteous.

[Lord Pearson of Rannoch]

I did not stand up because I was waiting for my turn. I moved to speak on several occasions. Obviously I am in the hands of your Lordships, but I understand that we are entitled to speak to these amendments in their order on the Marshalled List, and I have rather different points from those of the noble Lord, Lord Waddington, as I regard the single market’s disadvantages as rather different.

[Lord Pearson of Rannoch]

I merely wish to say that I wanted to speak to this amendment from the start. It is not my fault if the noble Lord, Lord Wallace, did not catch my eye before he stood up. I am always a very well behaved boy in your Lordships’ House, and with the extreme charm with which the Chief Whip has put her request, I shall not continue with my remarks now. But they are important because they prove that the single market has been a disaster for this country. I shall come back to that under Amendment 41, if I may. In the mean time, the Minister can feel free to carry on. I did not realise that we were on a close deadline.

[Lord Wallace of Saltaire]

We are not necessarily on a very tight deadline, but it is customary to move towards a close. However, I was speaking. I thought that the noble Lord was trying to intervene and gave way to him as an intervention. We clearly misunderstood where we were.

I was saying that, speaking in another place, David Miliband also said in November 2009:

“The Lisbon Treaty provides the Union with a stable and lasting institutional framework. We expect no change in the foreseeable future, so that the Union will be able to fully concentrate on addressing the concrete challenges ahead”.—[Official Report, Commons, 23/11/09; col. 273.]

I agree with those pragmatic, practical sentences. We all recognise that there are differences of view within all parties about European matters. The noble Lord, Lord Davies of Stamford, has moved from one party with a very wide range of views on European integration to another, as he well knows. I shall not respond further to his slightly hobnail-booted references to relations within the current coalition.

[Lord Davies of Stamford]

The great joy for me is that, for the first time in many, many years, I find myself in agreement with those on my Front Bench. I assure noble Lords that that makes a great deal of difference.

[Lord Wallace of Saltaire]

I return to where we were on the amendment, as on some of the others that follow. Here we have a Government who are playing a positive and practical part within the EU within its existing, but considerably expanded, competences. I have looked at Articles 102 to 106 and Articles 114 and 116. I totally failed to find the relevance of Article 308, which, in my copy of the treaty, is about the European Investment Bank, but perhaps when we get to debate on Article 41, the noble Lord, Lord Pearson of Rannoch, will tell us what that is all about.

[Lord Pearson of Rannoch]

I was referring to Article 308 as it was under the Nice treaty. Before that it was Article 257 in the original treaty of Rome.

[Lord Wallace of Saltaire]

I will not pursue that further.

The question is: does the Bill tie the hands of the British Government against British national interests? That is the fear which the noble Lord appears to have; I have to say that it is an irrational fear. There is a great deal that the British Government can do to pursue our national interests within the European Union within its present competences, and we are doing so.

The noble Baroness, Lady Symons, gave us an early version of her speech on the question of enhanced co-operation before dinner. As it happens, the United Kingdom Government are leading in early enhanced co-operation. The Franco-British treaty puts us very much in the lead on European defence co-operation. It is not what some other members of the European Union would have liked to put in the treaty, which was a commitment to have a European army, but of course they did not know what they meant by having a European army: it is much more practical co-operation on military affairs. That is the way forward, it seems to us.

On the following amendments from the noble Lord, I see nothing in the Bill which cramps the British Government in pursuing practical and effective British interests within the European Union in strengthening the single market. We now know that the single market has not been fully implemented. Some of what was happening in Greece was appalling; I have just been to southern Italy and it was quite easy to see parts of the single market which are not enforced there, but the powers are there. The single market needs to be more effectively enforced. There are clauses in the Lisbon treaty which talk about expanding the single market into services. There are some very tough clauses on state aids and competition law. We have those powers, and we do not need to spend more time chasing constitutional change before we begin effectively to make the European Union work better.

[Lord Liddle]

My Lords, the noble Lord, Lord Wallace, has tried to make a very powerful case for the Government, but actually he is unwittingly misleading the House when he quotes David Miliband as saying that there is no need for any further institutional navel-gazing on the basis of the Lisbon treaty. I would agree with that, although obviously the euro crisis has created a new situation in economic affairs. Broadly speaking, given where he stood in 2009, that is absolutely right, but David Miliband was talking about the Lisbon treaty that contained the simplified revision procedure under Article 48(6) and the passerelles under Article 48(7). He was talking about the package that gave the Union powers but also contained limited flexibility to change those powers in the light of circumstances precisely in order to obviate the need for further major treaty change for a long period ahead.

What this Government are now doing and what this coalition has agreed to do is basically to hamstring the flexibility that the Lisbon treaty contains. That is why the Opposition are urging the Government to think again, because this is where all the requirements for 56 referenda come from. If only you would look at the issue of how to allow more flexibility within the Lisbon treaty, many of us on this side of the House would be satisfied. I shall withdraw the amendment for the moment in the hope that the Government will consider these issues further.