EU Membership (UK Renegotiation)

Pat McFadden Excerpts

Tuesday 5th January 2016 Westminster Hall

[Mr Pat McFadden (Wolverhampton South East) (Lab)]

It is a pleasure to serve under your chairmanship, Mr Percy. I wish you and all the other Members present a happy new year, and I congratulate the hon. Member for Kettering (Mr Hollobone) on securing this debate. It is fitting and timely to begin the year by discussing this issue. If the referendum is held in 2016, it may well be the defining political issue of the coming year. It certainly dominated the media over Christmas and the new year, as various Conservative grandees came out either for or against EU membership, or gave their views on the issue of the application of collective Cabinet responsibility.

Since our debate began about an hour ago, we have been led to believe that the Prime Minister will make an announcement this afternoon confirming that collective Cabinet responsibility will not apply on the issue of the referendum, and that Ministers will be free not only to vote as they wish but to campaign as they wish. So, my first question to the Minister is whether those media reports, which are running as we speak, are true, and whether collective Cabinet responsibility will indeed not be applied on this issue.

[Mr Peter Bone (Wellingborough) (Con)]

In the right hon. Gentleman’s party, collective Cabinet responsibility has obviously been given up already. In relation to the EU, does he think that Ministers and shadow Ministers should be able to campaign as they see fit?

[Mr McFadden]

I agree with the hon. Gentleman that Labour Members know a thing or two about free votes after our recent experience, and his intervention gives me a chance to pick up on some of the points made by my hon. Friend the Member for Blackley and Broughton (Graham Stringer).

In the Labour party, we have a clear policy—passed by our conference—to campaign for the UK to remain in the EU. I am not aware of any Front Bencher who disagrees with that policy. There is a pro-Europe group in the parliamentary Labour party that has the names of 214 of the 232 Labour MPs, including every member of the shadow Cabinet. So that is where we stand regarding the balance of views on the issue. I do not deny that there are some Labour MPs who take a different view, as my hon. Friend the Member for Blackley and Broughton set out, but they are only a small minority of the parliamentary party. That is where we stand on this issue.

[Daniel Kawczynski]

rose—

[Mr McFadden]

I will make a little progress before giving way again.

Regarding the terms of the renegotiation, which is the subject of this debate, we have had the exchange of letters between the Prime Minister and one of the “famous five” Presidents, Donald Tusk, who is the President of the European Council. Mr Tusk replied to the Prime Minister’s letter on 7 December, setting out his assessment of where other member states stood on this agenda. There are four items, or four “baskets” as they say, and we are led to understand that progress has been made on the first three issues—protection for non-eurozone countries, competitiveness and the rights of national parliaments—but that further discussions are taking place on the final issue, which we are led to believe is the most difficult of the four issues to resolve, and which is the issue of access to in-work benefits for workers from other EU member states.

[Daniel Kawczynski]

I am grateful to the shadow Minister for giving way. On that point, could he clarify matters for us? Bearing in mind the way that renegotiation is going, what is the Labour party’s official position as to whether or not it is in our country’s national interests to have the referendum earlier—in other words, in June or September 2016—or later, in 2017?

[Mr McFadden]

I thank the hon. Gentleman for that intervention. We have not expressed an opinion on the exact timing, other than to say, as we said during the passage of the European Union Referendum Act 2015, that we do not think it is a good idea to combine the referendum with other important elections scheduled for May this year or May next year, because this issue is of such import that it deserves a campaign and a vote on its own. That is what we have said about how the referendum should take place.

I will put a couple of questions to the Minister about the renegotiation. First, is it correct for people to conclude that there has been substantial progress on the first three issues that I have referred to, but that the fourth issue remains more difficult to make progress on?

On that fourth issue, which is the issue of tax credits and other in-work benefits for workers from other EU member states, the Government’s contention is that the availability of those benefits acts as a pull factor, resulting in levels of immigration that are higher than they would otherwise be. Consequently, the Prime Minister claims that if those benefits are curtailed in the way that he has set out immigration will go down. I disagree with a lot of the points that have been made today by hon. Members who wish to campaign to leave the EU, but there is one issue on which I think I am in some agreement with them, which is to be sceptical about this claim. What evidence do the Government have for the contention that these in-work benefits are affecting the level of immigration? By how much do the Government believe that immigration from other EU member states will go down if the availability of in-work benefits is cut in the way that the Government have set out?

The Office for Budget Responsibility, giving evidence to the Treasury Committee before Christmas, said that its view is that such a change to in-work benefits would make little difference to immigration levels. Also, is it not the case that the vast majority of people who come to the UK from other EU member states come to work hard, pay their taxes and make a positive contribution to this country, in the same way as anyone else?

[Graham Stringer]

I am grateful to my right hon. Friend for giving way and I am pleased that he is sceptical about the basis of the Government’s policy in this area. However, does he agree not only that that policy will fail to do what it says on the tin, but that it is an offensive policy, which will be very divisive in the workplace?

[Mr McFadden]

I think there is a case for a discussion about the basis on which people have access to benefits, but there is a big difference between saying that and claiming that restricting access to benefits will make a fundamental difference to immigration levels. The truth is that people come to the UK because it is a great country, not because it is a “soft touch” on welfare.

We will probably see the results of the renegotiation soon, so I would also like to ask the Minister a question about timing. If he expects that there will be a conclusion to these negotiations at the European Council in February, what will be the implications of that conclusion for the timing of the referendum itself? The 2015 Act only says that the referendum must be held by the end of December 2017, but the Prime Minister’s new year message indicated that it was more likely to be held later this year. I ask the Minister directly: if the renegotiation is completed in February, is it the Government’s intention to hold the referendum this year rather than next year?

In one or two of the interventions on me, I was asked about my own party’s position. Our view is that we should not make the decision about whether or not Britain remains a member of the EU on the basis of this renegotiation. At the end of the day, the question on the ballot paper is, “Remain or leave?” It may be the case that the Prime Minister’s renegotiation has some impact on the public view of that question, but it may well not be the case, because there are issues concerning our EU membership that go well beyond the four items that the Prime Minister has set out in his renegotiation.

Our party conference quite clearly supported a position of being in favour of remaining in the EU and our campaign to remain in has already been launched, under the leadership of my right hon. Friend the Member for Kingston upon Hull West and Hessle (Alan Johnson). We want to see what the renegotiation produces, but that is our basic position.

My final point in response to some of the arguments that have been put forward by Government Members is that we have been told repeatedly today that we can retain access to the single market without paying anything for it. I would like to ask a question about that assertion, which is perhaps more for the hon. Member for Kettering, who secured this debate, than for the Minister. On what basis is it made? If the British people are going to be asked to exchange more than 40 years of EU membership for a future outside the EU, they have a right to know—with some certainty—what that future will entail. What will it mean for access to the single market? What will be the price for access to the single market? What will that future mean in terms of our adherence to the rules of that market while we perhaps forgo any say about what those rules are? What will it mean for inward investment in this country, which in European terms comes at the rate of tens of millions of pounds every single day? What will it mean for our export industries? What will it mean for our research, our universities, our agricultural industries and so on?

Whatever the flaws of the EU, a referendum on it is not only a referendum on one future but a choice between two futures, and those who advocate leaving the EU need to do an awful lot more to say what being out would be like.