European Union

Martin Horwood Excerpts

Tuesday 13th December 2011 Commons Chamber

[Mr Dodds]

The hon. Gentleman is absolutely right, and I will come shortly to how we should rebalance our relationship with Europe. He is right to point to the type of relationship that we should have—one based on free trade and co-operation with our European friends and neighbours, but on a sovereign nation to sovereign nation basis.

There are those who tell us that the Prime Minister has gone against the whole thrust and approach of UK foreign policy for the past 40 to 50 years. I have no doubt that there is much wailing and gnashing of teeth in the bowels of the Foreign Office and elsewhere among the professional mandarins who have seen the EU as almost a sacred cause, to be advanced whatever the wishes of the British people or the views of the temporary occupants—as they would see it—of political office. For the mandarins, the people and those who occupy political office are to be managed and dealt with—although I am sure that that does not apply to the occupants of office in this Government.

[Martin Horwood (Cheltenham) (LD)]

The gnashing of teeth is not just among mandarins, is it? Has the right hon. Gentleman heard from the business analysts at IHS Global Insight? They said that

“the European council statement made clear that a new ‘fiscal stability union’ would seek to deepen the internal market, creating stronger fiscal and economic rules.

‘Outside this union the UK is likely to become increasingly irrelevant and marginalised’”.

Does not such concern on the part of business worry the right hon. Gentleman?

[Mr Dodds]

I have heard all that before. We heard it at the time of the UK’s withdrawal from the exchange rate mechanism and when Britain decided not to join the euro. We have heard time and again the dire warnings of doom and gloom. However, if we reach the position that the hon. Member for Basildon and Billericay (Mr Baron) outlined, of a relationship based on free trade and co-operation, it will free our economy from much of the regulation, red tape, bureaucracy and dead-weight of EU laws that currently hold us back from the true competitiveness and real growth that we need.

We have not just heard from the hon. Member for Cheltenham (Martin Horwood); we have also heard the hysterical reactions of blasts from the past such as Paddy Ashdown, Michael Heseltine and the other usual suspects. It is time the House realised that focusing our foreign policy on the narrow ground of greater Europeanism and ever closer political union in Europe is contrary to the UK’s vital interests.

We make it clear that we must and should work with our European neighbours and friends on a host of economic, political and policy issues. However, let us also recognise the enormous opportunities on the wider scene: our unique position in terms of the Commonwealth, our special relationship with the United States, and our standing in the United Nations. For too long our vision as a country has been dominated by the little Europeanists, who want to take us in only one direction. It is high time that blinkered approach was discarded.

There are those who say that what the Prime Minister did was wrong because we must do all we can to save the euro. However, as was said earlier, in considering the events of last weekend, it has been overlooked that, for all the talk about arrangements to prevent future crises, not a lot was done to instil confidence that the immediate crisis will end any time soon.

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[Martin Horwood (Cheltenham) (LD)]

I congratulate the Democratic Unionist party on a timely choice of topic and on some smart draftsmanship in the wording of the motion.

It is reasonably common knowledge that the Liberal Democrats think that the outcome of last week’s summit in Brussels was not a good one. The less important reason for the outcome being bad was that the Prime Minister felt compelled to threaten the use of a British veto. That has generated a great deal of media interest and political over-excitement, but that was not the big issue. The big issue, as the Minister rightly emphasised, is the economic and financial crisis still facing the continent of Europe and, by extension, still facing the UK economy and the global economy.

It is already pretty clear that the hundreds of billions of euros mustered by the IMF, the European stability mechanism and potentially the European Central Bank have not been enough to reassure the markets. Italy, Spain, Portugal and Greece are all still under pressure. Some people have talked as if overnight exits from the eurozone would be desirable, even if they were possible, but they would not be; they would be catastrophic. The prospect of disorderly defaults and eurozone exits would threaten wholesale bank failures, bankruptcies and insolvencies across Europe, and that is still possible. I do not think the eurozone countries have yet put in place the firepower required to avoid it.

The capacity needed by the financial institutions will probably run to trillions of euros. It is not just a short-term crisis, as some of my Eurosceptic friends have pointed out. There are long-term structural issues concerning the compatibility of the German economy with those much weaker and less competitive economies in the same currency union, and those problems have not yet been sorted out. Perhaps the structures and the rules of a new treaty or agreement, whatever form it takes, may prove to be the beginning of a solution, but the process is still a long way from complete and there are quite a few obstacles in its path, some of them sitting in this Chamber.

[Mr Cash]

As one of the immovable objects to which the hon. Gentleman refers, may I stress that we are talking about the rule of law? I am sure he would not want a device to be used that attempted to bypass the legal processes of the very treaties that he so strongly advocates.

[Martin Horwood]

Of course not, and the law will be followed, but we may find that European Governments have to gather yet again for more crisis summits in the not-too-distant future. That offers Britain a bit of an opportunity. We now need a process of positive and active diplomacy to persuade some of our more traditional allies in Europe—Ireland, Sweden, even Germany, and many others—of the benefits of having Britain fully involved not in the eurozone, but in the overall process of European economic decision making. Why? Because one of the medium to long-term solutions to Europe’s problems is to have a real focus on jobs and sustainable prosperity—jobs and prosperity in the UK, as well as in the rest of Europe because, as has been pointed out, half our trade and foreign direct investment comes from other EU members.

The argument about repatriating powers, let alone leaving the EU, completely misses the point. It is in our interest not just to have a competitive and vibrant British economy, but for there to be a competitive and vibrant European economy as well, and Britain can help to bring that about. It is not just in Britain’s interest to be at the heart of the European economy and European economic decision making; it is in Europe’s interests too, and that in turn will help British jobs, British business and British prosperity.

[Bob Stewart]

In those circumstances, would it not be wise for those people who want us to stay in to come to us and say, “Look, talk again. We want to give you what you want. We really require you”? I think Europe requires us rather more than we require Europe.

[Martin Horwood]

The hon. Gentleman makes a very good point. The Liberal Democrats supported the initial negotiating position. The mystery of last week’s summit is why we seemed to have so few friends in the negotiating chamber who would support those reasonable initial demands. That is why I am suggesting that we have a process of much more active and positive diplomacy in the run-up to what might be future summits.

[Dr Julian Lewis]

Will the hon. Gentleman give way?

[Martin Horwood]

No. I have taken two interventions, I am afraid, and time is short.

The reason we can go forward positively within Europe is that in Europe there are means of building alliances that do not depend on treaty changes or such complex and confrontational tactics. I cite in evidence the Under-Secretary of State for Business, Innovation and Skills, my hon. Friend the Member for Kingston and Surbiton (Mr Davey), who, by collaborating with European counterparts, has lifted onerous accounting rules from the smallest businesses in Britain and created a like-minded growth group, which the UK has joined with the Czech Republic, Denmark, Estonia, Finland, Germany, Ireland, Latvia, Lithuania, Malta, the Netherlands, Poland, Slovakia, Slovenia, Sweden and Romania to tackle common priorities and establish common negotiating positions on everything from the digital sector to services, impact assessments and smarter regulation.

We have the prospect, as the Europe Minister has pointed out, of rules over fisheries being returned increasingly to the local and national levels, and that is a positive development. There is the prospect also of co-operation leading perhaps to the reform of the EU’s budget processes, and there are plenty of opportunities for a common reform agenda.

If I may finish on a positive, coalition note, I think that mainstream Conservative MPs and Liberal Democrats can absolutely unite on the need for reform.

[Dr Lewis]

Before the hon. Gentleman sits down, can he tell us whether his party will vote for the motion, against the motion, in both Lobbies or not at all?

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[Martin Horwood]

Any Liberal Democrat who votes for the Democratic Unionist party motion tonight will do so extremely reluctantly, that is all I have to say.

It is a shame to try to snatch division from the jaws of unity, however, because I was finishing on a positive note. Conservatives and Liberal Democrats should unite on a reform agenda in Europe which does not necessarily require treaty change but will, I hope, be supported by other countries. Then we can build alliances and go forward positively, with the like-minded countries of Europe putting forward a positive and good plan for British jobs and British prosperity, for European jobs and European prosperity.

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[David Simpson]

If that is an invitation—[Hon. Members: “Don’t be tempted.”] I will not take it further; I think that is probably an internal matter for the coalition.

[Martin Horwood]

rose—

[David Simpson]

I will not give way because time is short.

Of course, I rise to support the motion that my party has tabled. The whole of Europe—countries in the EU and outside it—faces a major crisis. It is an immediate crisis that is made worse by the drag or gravitational pull of long-term policies, treaties, agreements and directives that lock EU countries, especially those in the eurozone, into a negative economic cycle. Countries were allowed to join the euro that were simply in no fit state to do so and should never have been permitted to do so. Their admittance had nothing to do with their ability to survive and prosper with the euro, but everything to do with the ideology of those who have pressed for an EU superstate. The Republic of Ireland, Greece, Portugal, Spain and Italy were welcomed into the euro on the ground of a pro-European superstate rather than hard economic assessment.

At the same time as those fundamental weaknesses were being built into the eurozone, there were cries in the UK that we should be part of that disastrous undertaking. There were ardently pro-euro factions in the Conservative party and the Labour party. However, in both parties sanity ultimately won the day.

Many of us predicted that locking ill-equipped countries into a position whereby they could not devalue or set their own interest rates was a recipe for disaster. Some would say that, with the benefit of hindsight, Britain had a lucky escape. However, we do not need hindsight because we have history on our side—the history of the European Union and what has happened in it down the years.

From the phone calls and e-mails that I have received, I know that the general public in the United Kingdom are fed up to the back teeth with the money that we pour into Europe every year: £17 billion—£10 billion net, or, to put it in everyday terms, £200 million each day, only to see increasing red tape and an increasing desire to meddle in our courts, our immigration, our foreign policy, our tax system, our employment market and our national defence. For many people, that is simply not acceptable.

We should take the advice of the Prime Minister, who said at the end of October:

“This is the right time to sort out the eurozone’s problems, defend your national interest and look to the opportunities there may be in the future to repatriate powers back”

to the United Kingdom.

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[Andrew Percy]

Love thy neighbour, I say, and the Leader of the Opposition is my constituency neighbour, so I do not wish to speak ill of him, but I entirely associate myself with my hon. Friend’s words.

I want to concentrate on the Opposition’s position before saying a few words about the Minister’s response. The hon. Member for Wolverhampton North East (Emma Reynolds) did not answer my three questions: she did not say whether the Opposition have ruled out membership of the euro for ever; she did not say whether they believe that we have integrated too far and whether they are against integrating further or ceding more powers to the EU; and she did not answer my third question—one posed by many Members on both sides of the House—about what they would have done last Friday. There is this fanciful configuration under which they would have grabbed a deal—because the negotiating skills of the Leader of the Opposition are so renowned—that was good not just for Europe and the euro but for Britain. I simply do not buy it, and I strongly suspect that the British public do not either.

I want to say a few words about our valued coalition colleagues and their response over the past few days. I used to agree with a lot of what the Deputy Prime Minister said. Indeed, I clutch in my hand—although one must not use a prop, Mr Deputy Speaker—a photocopy of a Liberal Democrat election leaflet. They are mercifully thin on the ground in Brigg and Goole because we have no Liberal Democrat councillors. It is headed, “It’s time for a real referendum on Europe” and continues:

“It’s been over thirty years since the British people last had a vote on Britain’s membership of the European Union. That’s why the Liberal Democrats want a real referendum on Europe…But Labour don’t want the people to have their say. The Conservatives only support a limited referendum…Why won’t they give the people a say in a real referendum?”

The leaflet reads: “It’s time for a real referendum”.

[Martin Horwood]

Will the hon. Gentleman give way?

[Andrew Percy]

No, I have heard the hon. Gentleman’s explanation of this in the past, when he talked about a referendum at some time in the future, but this leaflet says very clearly, “It’s time for a real referendum”. People can even send it back to the real referendum petition, 4 Cowley street, London.

[Martin Horwood]

Will the hon. Gentleman give way?

[Andrew Percy]

I am not going to give way, because I have heard the nonsense about the Liberal Democrats’ manifesto commitment on this issue before, which was all about how there would be a referendum at some point in the future. However, I am afraid that the quotation given by the Deputy Prime Minister on this leaflet—he is named as “Lib Dem Leader Nick Clegg”—says:

“It’s time to give the British people a real referendum on Britain’s membership of the European Union.”

I can assume only that when this leaflet went to the printers, the bit saying, “At some point in the future, but not any time soon,” was missed off. Some people would say that the Deputy Prime Minister—

[Martin Horwood]

Will the hon. Gentleman give way?

[Andrew Percy]

I am not going to give way, so give up.

[Martin Horwood]

On a point of order, Mr Deputy Speaker. Is it in order for someone repeatedly to attack Members in the Chamber, and by implication the Liberal Democrat parliamentary party, and not give way when that is challenged?

[Mr Deputy Speaker (Mr Lindsay Hoyle)]

I think one would say that it is a political comment rather than an attack. As both parties are joined together, I am sure that the hon. Gentleman would take it not as an attack, but as a political comment.