European Union Bill

Viscount Trenchard Excerpts

Wednesday 25th May 2011 Lords Chamber

[Viscount Trenchard]

My Lords, I hesitate to intervene at this late stage in the debate, especially as I was unable to participate in the Second Reading and earlier Committee debates. However, I feel that I want very much to intervene in the debate now, and I especially felt that on Monday. The noble Lord, Lord Hannay, pointed out that no support on these Benches had been given to the Bill during the debate. I wanted to say that that was because the people who were moving amendments were those who wanted to change the Bill as it stood, whereas those of us who were silent could well have been silent because we supported the Bill as put before your Lordships’ House.

The Bill is intended to enhance transparency and accountability through greater public and parliamentary control over government decision-making and to increase the trust and engagement of the British people in the EU, which is very necessary.

The noble Lord, Lord Kerr, remarked earlier in his eloquent speech that we are fortunate to have on the Cross Benches of your Lordships’ House people who still live in the real world. I should like to ask the noble Lord where he thinks the real world is, because it seems to me that the real world for any of us is where we happen to be at any particular time. I do not have the same experience as the noble Lord of life in Brussels, but I spent one very enjoyable year there in 2006. I suspect that if I had spent a great many more years there, it is quite possible that my feelings towards the European Union’s institutions would have changed.

I have spent considerably more years in Japan, which is very different. Therefore I have seen the evolution of the European Union, and the United Kingdom’s place within it, from very different circumstances and a different country. That has led me to hold different views on our country’s bilateral relationships with other countries. I do not disagree for one moment that there are matters on which it is right to pool our powers with our European partners in order to exercise more influence. Equally, there is a great need also to draw a line in the sand. When I am in the real world outside this House, in the country or in other countries, I find that people want to know who is making their laws. I think that they feel cheated that there was no referendum on the Lisbon treaty. I am not sure that we should be proud as a Parliament to have provided a referendum only on AV and not on the Lisbon treaty, for it seems to me that the one, the Lisbon treaty, is much more important than the other.

Several noble Lords have suggested that we are changing into a plebiscitary democracy. There is a danger that we could have too many referendums; I am not in favour of having a great number of them. However, in matters which fundamentally change the way in which laws are made in this country, and where this Parliament decides to hand over, to all intents and purposes permanently, powers to the European Union, I think that most people think that they should have a say. So they definitely feel cheated.

I have enormous respect for my noble and learned friend Lord Howe. I listened with great respect to his eloquent speech in which he said that it would be better if we all concentrated on making the European project work rather than argued about this type of legislation. I remember voting in the referendum in 1975 to endorse the decision to join the European Community, as it then was. During many years in Japan, I extolled the virtues of the single market and tried to persuade Japanese companies to list their shares on the London Stock Exchange because of its access to it. I tried to persuade companies to come and invest in this country because it would give them access to a single market of 300 million people or whatever it was. However, at that time it was not envisaged that the European Union would extend itself into so many areas of legislation affecting our national life. A great deal was said about subsidiarity: in other words, where it is necessary to combine at European Union level, we should freely do so, but where it is possible and appropriate that national Parliaments should continue to decide things in the interests of their citizens who have elected representatives to those Parliaments, subsidiarity should apply. We hear very little about subsidiarity today.

The noble Lord, Lord Taverne, made a very eloquent speech in moving his amendment. He said that yesterday he heard that the City was very concerned about European financial regulations, and that therefore we should be very careful because a Bill such as this would reduce our ability to participate properly in formulating appropriate financial regulations. I feel that the noble Lord is seeing this from the wrong angle. It is increasingly difficult for our own regulators, who have far greater experience of financial markets, to make any regulations at all. The chief executive of the FSA told me fully a year ago that he can make no regulation now that is not agreed by the other 27 members, many of whom have very little experience in financial markets. Perhaps many of the other 27 feel that London has too large a share and would like to see some of that share go to other financial markets in the European Union. It is very important that we continue to defend the City and argue for the maximum say in these matters for our national regulators.

[Lord Kerr of Kinlochard]

Has the noble Viscount noticed, as I have with approval, Mr Lidington’s plan to make a speech today at the Mansion House saying that he will be relentless in dispelling the myth of Anglo-Saxon isolationism? This seems to me to be an excellent thing to do. Does he feel that this Bill in any way helps to remove from the continent the myth of Anglo-Saxon isolationism, and will he address the question of sunset clauses?

[Viscount Trenchard]

I thank the noble Lord for his intervention. Like him, I welcome the speech to be made by Mr Lidington. I do not wish the United Kingdom to be isolated in Europe—not for one minute. I believe that the Bill should help the United Kingdom to participate in decision-making in the European Union in matters where it is appropriate that we should do things together. It is necessary that we should make it clear where this country and this Parliament stand. We need this in order to define again the relationship of this country with the European Union. The people do not want to see more powers transferred to Brussels without their agreement.

[Lord Taverne]

Does the noble Viscount not see that if, as a result of the Bill and the difficulties placed on our negotiators, a procedure of enhanced co-operation was introduced for these regulations, it would not be to the City’s advantage?

Viscount Trenchard: My Lords, I have spent some time in Brussels, Paris and the Netherlands, talking to regulators. It is very important that we continue to engage, and that our national regulators continue to engage, with those regulators. However, it is not at all to the City’s advantage to duplicate regulation. It is not to this country’s advantage to duplicate diplomatic representation. We cannot afford to have two sets of regulators—one at the European level and one at the national level—doing the same thing.

We cannot afford two Foreign Offices. When I was in Tokyo for the first time, in the 1980s, I used to visit the office of the European Commission in Japan. It was the precursor to what is now to be called the EU embassy. What was there at that time already seemed fit for purpose; a large number of officials were doing their jobs. The other representatives of various countries used to gather in the office of the EC delegation, as it then was. Now I hear that the European Union, in pursuing the development of the European External Action Service, wishes to have ever larger embassies in major countries. This costs a huge amount of money. In Tokyo it will be very difficult because the British embassy already occupies number one, Ichiban-cho—that is, number one in the number one district. It faces the imperial palace across the moat. I am not sure where the European Union can establish its own embassy, if the only way it could be more grandly located would be to replace the Emperor himself.

On the sunset clause, I agree with my noble friend Lord Hamilton and others that, in the case of the Fixed-Term Parliaments Bill, there is a very good reason to have a sunset clause. Like him, I do not wish to see fixed-term Parliaments become a regular feature of our constitution. I do see that in these circumstances, where we have a coalition Government who have inherited a terrible fiscal situation, there are perfectly good reasons why this Parliament should be given a fair wind to continue for its full five years. However, I should be happy to see a sunset clause because that should not necessarily be the way for all time in the future.

In the case of this Bill, we cannot argue that the circumstances will be different from what they are now in three or five years’ time. What message does it send to the people if we enact a Bill, but say that it will cease to apply in three years, when we or a Minister of the Crown will decide whether to extend it? I see no logic whatever in attaching a sunset clause. Like my noble and learned friend Lord Howe, I believe that either it is a good Bill, in which case Parliament should pass it, or it is a bad Bill, in which case Parliament should not pass it. I would certainly vote against the amendments.

Baroness Garden of Frognal: There seems to be a general will in your Lordships’ House that we should complete this debate by 1.30 pm, rather than come back at 5 pm. Therefore, I suggest that noble Lords try to keep their comments brief and relevant to the sunset clauses.