Fund for European Aid to the Most Deprived

Mark Hoban Excerpts

Tuesday 18th December 2012 Commons Chamber

[The Minister of State, Department for Work and Pensions (Mr Mark Hoban)]

I beg to move,

That this House considers that the draft Regulation of the European Parliament and of the Council on the Fund for European Aid to the Most Deprived (European Union Document No. 15865/12 and Addenda 1 and 2) does not comply with the principle of subsidiarity for the reasons set out in Chapter 3 of the Twenty-second Report of the European Scrutiny Committee (HC 86-xxii); and in accordance with Article 6 of Protocol (No. 2) of the Lisbon Treaty on the application of the principles of subsidiarity and proportionality, instructs the Clerk of the House to forward this reasoned opinion to the presidents of the European institutions.

This is the third time that I have moved a motion on this issue. My hon. Friend the Member for Stone (Mr Cash), the Chairman of the European Scrutiny Committee, is the inspiration behind this motion and I am pleased to support it. I welcome the ESC’s report on the European Commission’s proposal and I am pleased to have the opportunity to discuss it on the Floor of the House.

The Government share the Committee’s view that the Commission’s proposal is not consistent with the principle of subsidiarity. The proposal would establish a new instrument: the fund for European aid for the most deprived. It is intended to replace, from 2014, the European Union’s food distribution programme for the most deprived people. The current programme distributes food stocks such as butter, milk powder, beef, sugar, rice and cereals, and in 2012 the budget has a ceiling of €500 million.

At present, 20 of the 27 member states participate. The main recipients are Italy, Spain, Poland, France and Romania. The UK has not participated since 1998, after which the previous Administration withdrew from the scheme. Both this Government and the previous Administration have opposed Commission proposals since 2008 to extend the programme and expand its social dimension. The UK has consistently set out its concern that the programme does not comply with subsidiarity.

Nothing in the Commission’s proposals changes our position. As the Committee points out eloquently in its report, the Commission has not provided a convincing justification of the need for EU action. Indeed, in many ways the new proposal is even more objectionable than the current programme. It will be used not only to provide food aid, but to purchase and distribute basic consumer goods. Whereas the current scheme is optional, the new scheme will be obligatory on member states and they will be required to provide match funding of at least 15% of the costs.

[Stephen Timms (East Ham) (Lab)]

I understand the Minister’s case that this could perfectly well be undertaken by national Governments, but do the Government intend to give any help to the network of food banks that is growing at a rate of, I think, three a week up and down the country and for which there is a clear need?

[Mr Hoban]

Food banks are undertaken by the voluntary sector. I will come on to the ways in which the Government provide support to people on low incomes or who are benefit recipients, in order to demonstrate why we do not believe that this EU programme is right. Our principal objection, of course, is one of subsidiarity, echoing the ESC’s comments, but also reflecting the previous Government’s stance when they withdrew from the scheme.

[Luciana Berger (Liverpool, Wavertree) (Lab/Co-op)]

To pick up on the Minister’s point that the voluntary sector makes a choice to step in, we now have up to 300 food banks across the country under the umbrella of the Trussell Trust, which estimates that it will have fed about 250,000 people in our country by the end of this financial year. Does he think that it is right that the voluntary sector has to step in to provide people in this country with emergency food aid?

[Mr Hoban]

The hon. Lady is a prolific tabler of questions on this matter and I have answered one or two for her today. This initiative is undertaken by the voluntary sector. The previous Government ignored the existence of food banks. Even at the height of the recession, when long-term unemployment doubled, the previous Government simply ignored them and pretended that they were not there. This Government acknowledge the existence of food banks. They play an important role and enable people on low incomes to get food, toiletries and other basic needs, and to use their incomes or benefits for other purposes. We also signpost people to food banks, but what nobody has done yet—this point has been made on a number of occasions—is analyse who uses food banks and why.

[Stephen Timms]

Will the Minister give way?

[Mr Hoban]

I want to make progress. This debate is about European proposals to spend taxpayers’ money and, if I remember rightly, the Labour party seems very keen to reduce the EU budget. We look forward to hearing what the right hon. Gentleman has to say. I do not know whether he is suggesting that we should enter this programme and that he supports obligatory participation. Perhaps he will clarify his position now.

[Stephen Timms]

Does the Minister accept that the number of people using food banks is bound to go up further in the coming 12 months?

[Mr Hoban]

I am not going to predict that. Perhaps the right hon. Gentleman has missed what has been happening recently. He should recognise that there are record numbers of people in work and that unemployment is falling. The number of people on out-of-work benefits has fallen by 199,000 since May 2010. I am not going to engage in making predictions, but I would have thought that he celebrates the fact that more people can look after their own families and that more people who want to work are getting into work, meeting that basic aspiration that we all want people to share.

The right hon. Gentleman did not say whether his party will sign up to the Commission’s proposal and whether they want to spend more taxpayers’ money in Europe. Hopefully he will mention that in his remarks.

[Mr John Redwood (Wokingham) (Con)]

I congratulate the Minister on taking a firm line on this matter. I am glad that he is opposing this regulation. I notice that all matters have to be accounted in euros, which does not seem to be appropriate for a country that still has its own currency. What does he think the outcome is likely to be in the debates and discussions in which he puts our case?

[Mr Hoban]

At the moment, discussions are taking place in the working groups. One discussion has taken place so far and I believe that there will be another in the new year. There is currently a blocking minority that is opposed to the regulation. A number of member states that are concerned about the EU budget and the multi-annual financial framework are keen to oppose the proposal. Of course, the money will come out of the structural and cohesion funds, so it will not be spent on other ways to improve the economy across Europe.

[Kate Green (Stretford and Urmston) (Lab)]

Will the Minister give way?

[Mr Hoban]

I will make a bit more progress. I am sure that the hon. Lady has some interesting views on subsidiarity that she will want to share a little later.

The Government’s view has not changed. We are unconvinced of the merits or appropriateness of the proposal. The principle of subsidiarity, which is enshrined in article 5 of the treaty on European Union, states that the EU should act collectively only when

“the objectives of the proposed action cannot be sufficiently achieved by the Member States”

on their own, but can “be better achieved” by action on the part of the Union. We consider that the measures to assist the neediest members of society, as set out in the proposal, can be better and more effectively delivered by individual member states through their own social programmes, not at an EU level. Member states and their regional and local authorities are best placed to identify and meet the needs of deprived people in their countries and communities in ways that are administratively simple and efficient.

In the explanatory memorandum, the European Commission states that the ability of member states to support those who are at the margins of society has been diminished and that social cohesion is threatened by fiscal constraints. We recognise the need to protect the most vulnerable in society and are taking action to do so. However, as I have said, there is nothing in the proposal that could not be organised and financed by member states. The Commission provides no convincing argument for why it is necessary to superimpose a European scheme. The solution must lie with the member state, not at EU level. Member states have that responsibility and must take it. The Commission may argue that the response of member states to these issues is inadequate or that some member states make use of the food distribution programme. However, the Commission does not make the case that the situation is the same in all member states. There is, therefore, no justification for making the fund mandatory for all member states.

[Kate Green]

In a debate on food poverty a few days ago in Westminster Hall, which was called by my hon. Friend the Member for Liverpool, Wavertree (Luciana Berger), the Minister of State, Department for Environment, Food and Rural Affairs, the hon. Member for Somerton and Frome (Mr Heath) made much play of the fact that food poverty was being caused not, this Minister will be pleased to hear, by the actions of the Government—although some of us were sceptical—but by rising food and commodity prices around the world. Is that not exactly the kind of issue that is susceptible to collective European solutions, particularly when this country is seeing a rising number of people, including working people, having to access food banks because of the Government’s failure to act?

[Mr Hoban]

I am not entirely sure what European action the hon. Lady thinks would tackle that problem. We do need to examine the regulation of commodity markets, which is happening in connection with MIFID II—the second markets in financial instruments directive —at the moment. However, European Governments intervening to buy up food stocks might not be the most helpful action. Those with long memories, such as my hon. Friend the Member for Stone (Mr Cash), will acknowledge that the source of the programme in question was the intention to tackle another problem—the wine lakes, butter mountains and so on. European intervention perhaps causes as many problems as it is intended to solve.

In justifying its position, the Commission points to the Europe 2020 strategy and its headline target of reducing poverty and tackling social inclusion. However, as the European Scrutiny Committee indicated in its report, the proposal was not envisaged when the Europe 2020 strategy was devised, nor does the existence of an EU target mean that action must be taken at EU level. In any case, the EU already has instruments to strengthen cohesion in the form of structural funds. We believe that EU cohesion policy should contribute to tackling poverty and the European social fund programme should contribute to helping disadvantaged people into work.

We are also concerned that the proposal does not represent value for money and would be burdensome to administer. Using EU structural and cohesion fund processes to deliver the instrument in question would lead to heavy and costly administrative burdens on member states and partner organisations. The structural and cohesion funds are there for very different activities from the new fund. They do not buy and distribute food and consumer goods. The new fund will require different, and probably more burdensome, procurement, monitoring and auditing processes. Not only is it inconsistent with subsidiarity, it will also use resources that would be better deployed at national or local level.

If the fund were removed from the proposals, the UK could argue for an equivalent reduction of €2.5 billion in the EU budget over the seven years of the multi-annual financial framework. Given the Labour party’s view, I assume it would support that.

In opposing the Commission’s proposal, I reiterate that the Government strongly support measures to tackle poverty and social exclusion at member state level. In the UK, we have a full range of benefits and tax credits in place to cover financial needs for those in and out of work. We are investing £400 million in the current spending review period in helping local authorities prevent and tackle homelessness, and we are committed to eradicating child poverty. We are taking a new approach to tackling the root causes of such problems, including worklessness, educational failure and family breakdown. The EU structural and cohesion funds are better used in tackling the root causes of poverty than its symptoms.

On food aid, the Healthy Start scheme provides a nutritional safety net in the form of vouchers for basic healthy foods and free vitamin supplements for pregnant women and children under four from disadvantaged and low-income families. Initiatives such as FareShare and FoodCycle are good examples of essential work that charities are doing to support communities. We therefore believe that member states are capable of taking such action to help the most deprived, and we are not convinced that the European Union is better placed to take such action.

We agree with the European Scrutiny Committee that the Commission has provided no convincing argument that the proposal meets the principle of subsidiarity, and I thank the Committee for its work and for proposing the motion for debate.

--- Later in debate ---

[Mr Cash]

I could not agree more, and I would love to go down that route. I will not do so tonight, but the overpayment of civil servants in the European Union is a scandal.

Does the Minister believe that there is evidence of a broad “request by European citizens” for this type of supranational financial support? From what he has said, he clearly does not. The Commission’s impact assessment also states:

“Currently more and more social stakeholders and EU citizens perceive the EU as a threat for their personal and collective protection.”

It goes on:

“Action at European level is required, all the more so, as a lack of social cohesion would hinder the Union's further development and undermine its legitimacy in the eyes of its citizens.”

In other words, this aspiration is based on the fact that the Commission wants to create a perception that the European Union is helping people, and it is then calling for a vast amount of money to justify that perception. In a way, this is an exercise in legitimised propaganda.

The Committee found that statement startling on a number of levels. Does the Minister agree with the Commission that the EU is perceived as a threat to the “personal and collective protection” of its citizens? Does he think it legitimate for this type of humanitarian funding to be used to reinforce the EU’s legitimacy? This is almost akin to Soviet propaganda.

A constant complaint by our Committee is that the Commission does not pay sufficient attention to the need to confirm that its legislative proposals comply with the principle of subsidiarity. I have given the House some instances of breaches of the rule of law. What kind of Government does the Commission purport to run, if it breaches the rule of law whenever it suits it to do so? When it was breaking the rules on the European financial stability mechanism, for example, Madame Lagarde came out of a meeting and said, “We’ve violated all the rules because we want to preserve the euro.” The thinking, which is very dangerous, seems to be: “Providing we can use the power that the member states have given us to get what we want, it does not matter whether we can justify our actions according to the rule of law or the principle of subsidiarity. We’re going to do it anyway, and we’re going to justify it by talking about people’s perceptions.”

It is no wonder that people like me get up repeatedly—like pestering wasps, as I said to the Prime Minister the other day—and try to ensure that we keep the European Commission under surveillance and control. That is precisely what the European Scrutiny Committee is doing. We are ensuring that these matters are properly looked at, and I am delighted that the Government are going with us on this occasion. In this instance—believe it or not—the word “subsidiarity” is not even mentioned in the Commission’s explanatory memorandum. Will the Minister give us his assessment of the Commission’s assertion that the proposal does comply with subsidiarity? Does he agree that, in order to warrant supranational action, the Commission must show that the provision of emergency aid in some member states is undermining social cohesion in others, and that there is a genuine cross-border element involved?

I am arguing the case on subsidiarity, never mind on the justification of the arguments on the merits of giving money. It is an utter, complete and devastating tragedy that people all over Europe are resorting to using food banks. I sympathise with the concerns of the hon. Member for Liverpool, Wavertree (Luciana Berger) about those very people. I do not have any problem there. It is one of the reasons why I spend as much time as I can on matters relating to international aid in countries throughout the world and in the Commonwealth. I am concerned about these people, but we cannot use this sort of legislative framework because of the misuse to which it is being subjected. So does the Minister think that the Commission has proved the existence of this cross-border element?

[Mr Hoban]

No.

[Mr Cash]

I am delighted to hear that. This is where it gets tricky for us as a Parliament. We generally agree that this is not the right thing to do and I believe that the Opposition agree with that in terms of subsidiarity, although they have expressed their view about the question of the merits. The problem is that the number of reasoned opinions on this proposal will fall far short of the minimum required to oblige the Commission to reconsider. However, in the opinion of the Committee, that does not mean that a reasoned opinion of the House of Commons is without meaning or consequence.

Finally, will the Minister tell us whether—and, if so, to what extent—the Government plan to make use of the reasoned opinion in the Council negotiations on this proposal. As I said to the Prime Minister on another subject, it is difficult—he is between a rock and hard place. There are dilemmas, but we as a Committee have a job to do, which is to point out where the subsidiarity has been breached and to present a reasoned opinion. What really troubles me is that we do our job and look to other member states that are constantly berating us for our so-called “attitude” towards the European Union. However, when there is an absolutely clear-cut breach of the rules that they have set themselves, they turn round and say, “Well, we listened to what you said. We are not going to enter into an argument with you about whether you are right on your reasoned opinion”—they cannot; there is no way that could possibly be justified—and then they say, “But we are still going to vote for it.” That is the way to destroy the European Union, and they are doing a pretty good job.