European Union Referendum Bill

William Cash Excerpts

Tuesday 9th June 2015 Commons Chamber

[Mr Hammond]

The answer to question No. 1 is no and the answer to question No. 2 is that the Prime Minister has set out in a series of speeches, articles and interviews, and in the Conservative party manifesto, the key areas where we require change to the way that Britain’s relationship with the European Union works if we are to be able to get the consent of the British people to our future membership.

Conservative Members have long been clear that the European Union needs to change and that Britain’s relationship with the European Union needs to change. Unlike the Labour party, we believe that Brussels has too much power and that some of those powers need to be brought back to national capitals. In a world whose centre of economic gravity is shifting fast, Europe faces a serious challenge. If we are to continue to earn our way in the world and to secure European living standards for future generations, the EU needs to focus relentlessly on jobs, growth and competitiveness. Bluntly, it needs to become far less bureaucratic and far more competitive.

With the European electorate more disenchanted with the EU than ever before and with anti-EU parties on the rise across the continent, it is time to bring Europe back to the people, ensuring that decisions are made as close to them as possible and giving national Parliaments a greater role in overseeing the European Union. Such issues resonate across all member states. Change is needed for the benefit of all to make the EU fit for the purpose of the 21st century.

[Sir William Cash (Stone) (Con)]

I applaud my right hon. Friend’s opening remarks and the Prime Minister for making certain that we had the Bill. May I ask the Foreign Secretary one question? In the last statement made by the Prime Minister in the previous Parliament, he clearly said that he wanted reform and a fundamental change in our relationship with the EU. Will he explain what the second part of that means in practice and in relation to the debate?

[Mr Hammond]

My hon. Friend’s question is germane to the point I am making.

For the good of all 28 countries, there are things that need to be done to reform the way in which the European Union works to make it more competitive, effective and democratically accountable. However, the British people have particular concerns, borne of our history and circumstances. For example, we are not part of the single currency and, so long as there is a Conservative Government, we never will be. We made that decision because we will not accept the further integration of our fiscal, economic, financial and social policy—[Hon. Members: “We made it!”] The hon. Member for Eltham (Clive Efford) says that Labour made that decision. Is it the position of the Labour party that we will never join the single currency? I have not heard that position being articulated from the Labour Benches. It would be a seminal moment in our parliamentary history if Labour was able to make that commitment today.

We made that decision because we will not accept the further integration of our fiscal, economic, financial and social policy that will inevitably be required to make the eurozone a success. So, in answer to the point raised by my hon. Friend the Member for Stone (Sir William Cash), we need to agree a framework with our partners that will allow further integration of the eurozone while protecting Britain’s interests and those of the other “euro-outs” within the EU. Because we occupy a crowded island with a population that is growing, even before net migration, and a welfare system that is more accessible than most and more generous than many in Europe, we are far more sensitive than many member states to the impact of migration from the EU and the distorting effects of easy access to benefits and services and of in-work welfare top-ups to wages that are already high by comparison with many EU countries.

In the Conservative party manifesto, we therefore committed to negotiate a new settlement for Britain in Europe—a settlement that addresses the concerns of the British people and sets the European Union on a course that will benefit all its people. The Prime Minister has already begun that process by meeting 15 European leaders, and at the European Council in June he will set out formally the key elements of our proposals.

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[Mr Clarke]

My right hon. Friend appears to believe that we can somehow have all the advantages of the European Union and the market without complying with any of the obligations. I know of no trading bloc that allows anybody entry to its markets on the basis that they will decide whether to comply with its rules.

I approve of the form of words in the Bill for the question but I hope, as the campaign goes on and we all form all-party campaigns, it becomes crystal clear what the question actually means. It is not solely about the negotiations for reform. Personally, I completely concede that the European Union has a lot of defects and is ripe for reform, and I approve very strongly of some of the measures, particularly those in the Bloomberg speech, which my right hon. Friend the Prime Minister is pressing for—if he can achieve them. However, the yes vote involves a decision on the future role of the United Kingdom in the modern world: how we are best able to further the interests of our citizens, defend our security, develop our economy and bring prosperity. That is the big question.

[Sir William Cash]

Will my right hon. and learned Friend give way?

[Mr Clarke]

I will not, because we are under a time limit and other people want to speak. I apologise to my hon. Friend. He and I have debated this frequently.

We are 1% of the world’s population and we represent 3% of the world’s GDP. As a proportion, we are declining yet further. On the question of being in the European Union, we need to get across to people that our effective voice in the world, insofar as we have one, is best deployed as a leading and influential player in the European Union. There will be less interest taken in British views by the United States, Russia, China, India and other emerging powers if we go into splendid isolation. As I have already said, the idea that we can somehow advance our future prosperity by withdrawing from the biggest organised trading bloc in the world, while at the same time, as a Conservative party, advocating wider free trade wherever it can be obtained, is an absurdity.

That leads me to the other argument: what does “out” mean and what does a no vote mean? I look forward to my Eurosceptic friends providing an answer to that, because Eurosceptics have always given different answers. My former hon. Friend who is now in the UK Independence party, the hon. Member for Clacton (Mr Carswell), has a quite different view of what a no vote means compared with some of my no voting colleagues on the Government Back Benches. Does it mean the Norwegian option? Do we stay in the trading area? That would mean we pay a large subscription, accept free movement of labour—Norway has a higher proportion of other EU nationals compared with Norwegians than we have compared with Brits—and comply with all the legislation, rules and regulations of the single market without having any say in them.

Do we go further than that and have the Swiss model? The Swiss model means we would have some access to the single market. However, in those areas we would have to comply with all the laws and rules that would be directly applied and have no influence on what they are.

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[Sir William Cash (Stone) (Con)]

This referendum Bill, which I in principle strongly applaud, is the culmination of over 20 years of campaigning, which commenced with the Maastricht referendum campaign in 1993. I congratulate the Prime Minister on carrying out his commitment, which disproves the allegations and claims made not only by our opponents but even by some of his friends. The reason for the Bill was that he listened. He listened to Back-Bench opinion, and in particular to the amendment that we put forward resulting in 81 colleagues voting for a referendum on the EU issue on 24 October 2011. I urge him to listen again now and ensure that this referendum is fair in its procedures, in its governmental and EU involvement, and in the impartiality of the broadcasting authorities. I also ask him to properly address the question of fundamental change in our relationship with the EU, as I mentioned in my intervention on the Foreign Secretary.

It was Churchill who said:

“Why be afraid to tell the British public the truth?”—[Official Report, 18 July 1946; Vol. 425, c. 1451.]

That is what we have tried to do since those Maastricht days. When I am under attack not only by Nigel Farage but by my right hon. and learned Friend the Member for Rushcliffe (Mr Clarke), which I was recently, I know I must have got something right. Since Maastricht, we have moved the terms of trade on all essentials in respect of the historic question of “Who governs this country and how?”, which in one form or another has recurred throughout the centuries—about every 50 years from time immemorial. This decision will now lie with the voters, but for it to be conclusive, it must be a fair referendum.

I now turn to what the Prime Minister clearly stated on 23 March, in the full knowledge that it would be part of the general election. In the last week of the last Parliament, he said:

“we have the opportunity to reform the EU and fundamentally change Britain’s relationship with it.”

He then referred to the referendum and added:

“If I am Prime Minister, that is what I will do.”—[Official Report, 23 March 2015; Vol. 594, c. 1122.]

I referred to this in the meeting of the 1922 committee immediately after the general election.

[Kelvin Hopkins (Luton North) (Lab)]

May I take up the hon. Gentleman’s point about the need for a fair campaign on the referendum? It is very important for there to be a balance of voices, representing both sides, in the broadcasting media in particular. Does he agree that for too long the BBC has tended to see the issue of the European Union as purely a Conservative party matter, although people on the left as well as the right take sceptical views?

[Sir William Cash]

I entirely agree. The European Scrutiny Committee was unanimous in its report, which was severely critical of the BBC’s failure to be sufficiently impartial in relation to European matters. There will be further discussion of that issue as we continue to debate the Bill.

At the 1922 committee meeting, I made it clear that we would engage not in wilful opposition but in a process of mutual respect and debate. In plain English, what the Prime Minister said on 23 March boils down to the following. He said that he wanted to change the basic principles by which the United Kingdom is connected to the European Union. He carefully distinguished between “fundamental change” in our relationship and mere reform of it. Reform may include some treaty change to include issues relating to benefits and so forth, but they pale into insignificance by comparison with the Prime Minister’s own assertion that he wants “fundamental change” in our relationship with the EU.

In its report on referendums, the House of Lords Constitution Committee made it clear that a referendum would be primarily necessary in the event of a proposition that we leave the European Union, as opposed to mere nibbling at the treaties. I have said repeatedly for years that if we do not achieve this fundamental change, we will have to leave the European Union. That becomes essential if we are to govern ourselves in line with the wishes of the voters in general elections. In his Bloomberg speech, the Prime Minister said:

“It is national parliaments which are, and will remain, the true source of real democratic legitimacy and accountability in the EU.”

Nothing is more important than that when it comes to the government of our country and its freedom.

Other member states may seek to block this action, but they do so at their own peril. They need us politically and economically, and they repeatedly say that they want us to remain in the EU; but then the handouts, the bail-outs, the subsidies and the ideology of political union get in the way. We have positive alternatives to the European Union. Our democracy and our national Parliament are what people fought and died for in two world wars, and it was through their sacrifice that we saved Europe in those two wars. It is not in the interests of Germany, Europe or ourselves for us to remain in the second tier of a two-tier Europe dominated and profoundly affected by a de facto eurozone, which is in reality at the epicentre of the legal framework of the European Union itself, in which we have been embedded by successive treaties and which does not work.

[Mr Jenkin]

That is the most fundamental point that must be addressed by those who want us to remain in the EU on the present terms. For 20 or 30 years we have had a dysfunctional relationship with the European Union because we do not want to be in political or monetary union, and do not want to be absorbed into something that looks more and more like a state. If those people cannot answer the question how we can be at the heart of this Union on a completely different basis, we will indeed end up as a second-tier member state of an increasingly centralised European Union.

[Sir William Cash]

My hon. Friend is absolutely right.

Removing the words “ever-closer union”—which have never been specifically adjudicated on by the European Court of Justice, and merely form part of the preamble to the treaties—will not solve the problem. It does not change the legal obligations of the accumulated treaties, from Maastricht to Lisbon. Notwithstanding their protestations, it will not be the establishment, the EU, the BBC or the self-appointed multinationals with vested interests who will decide these matters. None of those multinationals has advanced a rational argument to support their determination to stay in the EU. That is my response to what was said by my right hon. and learned Friend the Member for Rushcliffe, who asked the same question of us from the other side of the argument. They were hopelessly wrong about the euro, and have been hopelessly wrong about so many aspects of European debate.

It is the voters who will give their verdict by the end of 2017. It is the voters, and the voters alone, who will decide it, not the massed ranks of the Europhiles. The rolling back of the treaties is imperative to our national interest. Indeed, the 1971 White Paper, on which the European Communities Act 1972 is still founded, clearly stated that we must keep the veto precisely because it was in our national interest to do so. It went on to say that to do otherwise would

“imperil the very fabric of the Community.”

I look at my right hon. and learned Member for Rushcliffe because he knows that he supported that at the time, in 1971.

[Mr Kenneth Clarke]

My hon. Friend is quite right. In 1971 we had unanimity when making European laws, but once made, they were directly binding. It is the second issue that my hon. Friend is trying to reopen. In the Lisbon treaty, we went for weighted majority voting, because, with 28 member states, giving every Government the right to block any proposal would prevent any decisions from being made.

[Sir William Cash]

It was for precisely to deal with that problem that I set up the Maastricht referendum campaign. My right hon. and learned Friend and others have persistently and continuously opposed a referendum, because they have not wanted these matters to be reopened. However, they have been reopened by virtue of this Bill.

I was concerned to hear the Foreign Secretary say on Sunday that the unilateral repeal of EU legislation at Westminster was unachievable, and would lead to our leaving the EU. Of course, the second part of that proposition is inherent in the referendum itself; the voters will decide. The Foreign Secretary invoked the analogy of the yellow card, which has been a dismal failure. When it was applied in relation to the the European Public Prosecutor, the Commission simply ignored the result.

During the Maastricht debates, we were told by the then Foreign Secretary that the Maastricht Treaty was the

“high water mark of federalism”.

That was patent nonsense, as has been demonstrated by so much of the Europhilic commentary that has poured out in a relentless tide of enthusiasm for European integration, and which has engulfed the United Kingdom and Europe as a whole, causing protests, riots and massive unemployment. It will drag Europe down, and will create the very instability that the project after 1945 was intended to avoid.

We need amendments to this Bill, relating to matters such as the purdah arrangements, the question of prohibiting European or governmental money, the question of the impartiality of the broadcasting authorities, the level of expenses, the timing and also, perhaps, the question in the referendum. According to recent opinion polls, trust among the European voters is at an all-time low, and that trust is what lies at the heart of the whole debate. In the words of Lord Randolph Churchill, we must trust the people.

[Several hon. Members]

rose—

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[Damian Green]

Our Government are represented in the Council of Ministers and the Parliament; that is the democratic check. It can of course be improved—nobody is saying that the EU is perfect—but there are many institutions that need improving. Indeed, Parliament needs improving, but that does not mean we should give up on the many and manifold advantages of parliamentary democracy. That is the attitude with which we should approach the EU.

I am also in favour of the Bill because I am happy to take on in friendly public debate those who want to cut our close ties with friendly neighbouring democracies, and because I believe it is appropriate to have this debate now. The subject of Europe is a curious one in British politics. For a small number of people—some of whom have spoken today—it is an all-consuming passion. For the vast majority of the British people, however, it rarely features in the top 10 things they want Governments to get to grips with.

I will be happy to play a part in persuading the British people that the risks of turning our back on our democratic neighbours massively outweigh the benefits, but I will do this in the spirit of removing a cloud that has hung over politics for too long. Having the in/out debate always hovering around adds an unnecessary level of uncertainty to our national debate on many subjects, and it leaves the rest of the world, particularly our friends, unsure about Britain’s view of its own place in the world.

It has been clear for some time that we are going to need a referendum to clear up this uncertainty. It has been 40 years since the last one. The world has changed, the UK has changed, the European Union has changed. So let’s get on with it. Let us focus the British people’s minds on the choice before us, and see what they say.

[Sir William Cash]

rose—

[Damian Green]

I will, with some trepidation, give way to my hon. Friend.

[Sir William Cash]

I am glad my right hon. Friend has chosen to give way; my right hon. and learned Friend the Member for Rushcliffe (Mr Clarke) did not, so I am going to ask the same question. Does my right hon. Friend agree with the Prime Minister when he says that he wants not only reform but a fundamental change in our relationship with the EU?

[Damian Green]

I will talk about the change in the relationship in a few seconds, but first I want to turn to the Bill itself.

The Government are to be commended on passing the first and most important test in any referendum, which is that it asks a sensible and fair question. Asking whether we want to remain in the EU makes it clear that we are not starting with a blank sheet, but that we have an existing web of relationships, rules, and habits that would be put at risk by a no vote in the referendum.

Those who are most vocal in pointing this out are British businesses. They make the point that for the vast majority of our businesses the EU is not a straitjacket; it is a springboard to the opportunities provided by the global economy. This is as true for small businesses as it is for big ones.

The most recent CBI survey was interesting. It often says that eight out of 10 CBI members support our continued membership, and those who are against membership say it is just the voice of big business. However, if we drill down into that finding we discover that 77% of small and medium-sized businesses said that they support the UK’s continued membership of the EU. All of us on both sides of the House who recognise the importance of small businesses for prosperity, entrepreneurship and job creation should listen to their voices. People often complain that politicians do not listen.

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[Mr Baker]

My hon. Friend knows my view about money and banking, which is that we should have market-based moneys. That is one of the things that has gone profoundly wrong. He prompts me to say, however, that we are very clearly, across the world, in the midst of a profound crisis of political economy, and that is what we must wrestle and cope with. Some of the old, simplistic and unpleasant arguments of the past must be put to rest. We need to rediscover a true liberalism, one in which people are accepting of one another.

[Sir William Cash]

Does my hon. Friend also accept that the eurozone is a de facto entity, whereas the question before us in this referendum is about being part of the European Union? The eurozone is a basket case, but at the same time it is dominated by one country which causes a lot of distortion to the way in which it works.

[Mr Baker]

Indeed. It is important that there is a degree of flexibility in currency systems, and Alan Greenspan’s wonderful book on gold and economic freedom is something I commend to everybody.

As the Minister knows, I have misgivings about some of the details in the Bill, which some of my colleagues have already fleshed out. But it is a happy occasion today, because our party is wholly united in supporting the principle of the Bill. It is long overdue. We are delighted that it has come forward and we look forward to its progress.

In due course the people will decide. On the one hand they have the choice of radicalism—political union across Europe. That is the radical choice. The moderate, conservative choice is trade and co-operation among friendly nation states. People in the end will choose either for the European Union, or for Britain.