Previous Section Home Page

Column 1007

sincerely held. In particular in that regard, I am thinking of the comments of the hon. Member for Aldridge- Brownhills (Mr. Shepherd) to whom I always listen with great interest.

We are in an absurd position today. We have business before the House that one would normally expect to go through almost on the nod. It comprises several European Union documents which people generally have great difficulty reading because they are so thick and because they are usually out of date. One usually takes very little notice of them.

This sort of legislation should go through almost on the nod. However, the Government have tabled their motion and, because of the controversy to which the hon. Member for Aldridge-Brownhills referred, the Labour party could not resist challenging the vote of confidence-- [Interruption.] Labour will not win the confidence vote. I am not sure what the business managers are saying, but I am sure that many Labour Members will abstain on the main Question. The Government will get their business.

I am sure that all right hon. and hon. Members accept that fraud and waste must be tackled. No one would disagree with that. I would expect tough initiatives on this matter. The Chancellor seemed rather sanguine about the way things were happening. I should be grateful if the Paymaster General would describe the Government's position on this point and tell us whether they are satisfied with the current policies and whether they will work and be effective.

By the time of the intergovernmental conference in 1996, I hope that we will not have to include things in a Maastricht mark 2 treaty document on this point. By then, I hope that the policies will be in place and that we will have an effective system of monitoring and surveillance.

The key--the heart--of this matter is the future development of the European Union. Like the majority of hon. Members and, I believe, the majority of people in Britain, I want the European Union to develop, not to hesitate, not to be held back and not to unravel in any way. The stakes are far too high.

The future of the European Union for us is very important, socially and economically and from the point of view of peace, foreign affairs, matters of the interior, co-operation, and so on. That is absolutely vital, and the money must be forthcoming, particularly since, as I notice in the motion, that part of the money will be for expansion of the European Union. I find the notion of expansion exciting. All countries in the European Union will work for the benefit not only of European Union countries but of other parts of the world, particularly poorer countries.

Much has been made of Edinburgh, but the Edinburgh summit took place. The aim was to have a financial structure. One has to have that because it is impossible to plan something the size of the European Union without having some stability in one's finances. One has to be able to plan. I therefore believe that it is necessary to ensure that the Government succeed tonight and that the European Communities (Finance) Bill is passed.

I now refer to democracy. People talk about giving up our sovereignty. I prefer to use the "pooling". [ Laughter. ] There is giving and taking. Some hon. Members do not accept that. They do not believe in the European Union--I do. We all differ on that point. Just as the hon. Member

Column 1008

for Bridlington (Mr. Townend) will argue his case in his own way, I shall argue in my way. The future of my children and their children is in the European Union, which I want to work economically, but I also want it to create the basis of peace. In the first and second world wars, 30 million people died. The creators of the European Union--the people in the early days--said, "We must stop German nationalism. We must nail the feet of the Germans to the ground so that they cannot embark on any more wars." That was the basis. When one pools sovereignty, one must have a development of democracy. There is a democratic deficit in the European Union. It still has structures that are synonymous with an early institution, and quite centralised powers. Those powers must be spread. I hope that there will be much on that point in the treaty document that comes out of the 1996 IGC.

There has been talk about referendums. We had our referendum in 1975, and the majority was massive. The people of Britain decided then that our future was in the European Union--the European Common Market, as it was then called. Since the treaty of Rome, we have had further treaties. We have had the treaty on the single market and the Maastricht treaty. There will be another treaty in 1996. All those treaties are mechanisms for the development of the European Union. I look forward to the 1996 IGC and to debating beforehand what will be the key issues in it.

Many hon. Members who attended the Maastricht debate

resented--perhaps "resented" is too strong, but you, Mr. Deputy Speaker, handled the duties of the Chair brilliantly during those difficult times-- being presented with that thick blue document. Whether hon. Members are Euro-sceptics or pro-European Union, many felt that to be presented with such a document as a fait accompli was just not good enough. It is important that there is an opportunity for all Parliaments of the European Union in some way to be able to take part in such debates rather than be presented with a fait accompli.

Mr. John Townend (Bridlington): Does the hon. Gentleman agree that the purpose of the previous referendum was to stop the Labour party tearing itself apart? Therefore, would it not be equally fair now to have a referendum to stop the Conservative party tearing itself apart? Does the hon. Gentleman agree also that people voted to stay in--not to go into--an economic community? If they thought that they were voting to stay in what was going to become a federal state run from Brussels, with Westminster becoming a county council, many would not have voted yes in that referendum.

Mr. Randall: I accept what the hon. Gentleman says. One can always have new terms of reference for a referendum--one can have a new set every week and still not be satisfied--but that is what happened. It worries me that the leadership on both sides are talking now about the possibility-- the glint--of a referendum. Personally, I am against that. It would cause turmoil and it would stop development of the European Union, and that is not desirable. I would not want Labour or the Conservatives even to put a reference to a referendum in their manifestos for the next election. That would be completely wrong. When it comes to debating the issues rather than being presented with the blue document--this is entirely my own view, based on informal discussions with other European Union politicians--as soon as the French

Column 1009

presidential elections are over, and we can speculate on who can win, the Germans and the French will be setting the pace and we will be confronted with some important decisions. France and Germany could race ahead and challenge Britain on what it will do, and the question of a two-track Europe could come up. I should be very disillusioned if, in any way, the future of Britain were risked by Britain being put into the second track of a European Union.

On the balance of power, the doctrine of subsidiarity, which was debated with the Maastricht treaty, has not been taken far enough. It is a crucial element. The two new pillars or new powers that we have are very important. I refer to defence and foreign policy and home affairs.

On monetary and economic union, from the point of view of business, we must have a stable currency. My own view is that monetary and economic union will come as surely as night follows day. I want far greater co-operation, and I want a central bank to have the discipline that we want. I want to see great co-operation at European level, particularly in respect of high- technology products such as in the aerospace and information industries.

We on the left of British politics used to argue--I regret that we do not do so as much as we used to--about internationalism. The Common Market and the European Union have in some way eliminated that. I regard the European Union as crucial in developing poorer countries, not only in the European Union but outside it. Countries have benefited greatly. I appreciate that, and I welcome in particular the development in the size of the European Union. I regard the matter as a great opportunity. The 1996 IGC is crucial. I want to see those arguments put on the table. It is important that we have a stable financial structure which will allow planning to take place. That is what the motions before us tonight seek to ensure. We do not want there to be any hiccups in the future development of the European Union.

8.50 pm

Mrs. Teresa Gorman (Billericay): When my right hon. and learned Friend the Chancellor of the Exchequer opened the debate on the European Communities (Finance) Bill, he paid me the small but singular compliment of saying that I had been consistently opposed to giving more money to Europe; so my colleagues will not be surprised to learn that I do not intend to break my record in that respect this evening.

Tonight we are asked to vote for more money for Europe; we are not asked to stop it receiving the vast sum that it has been allocated already. When I listen to the debates in the House, and particularly those speakers on the Front Bench who talk of what percentages they did or did not manage to achieve, my mind drifts away from that technical stuff to my constituents who come to my surgery to relate their financial problems. An extra fiver or a tenner in their pay packets would make a good deal of difference to their standard of living and would reduce their worries.

I think also about the business men in my constituency. They tell me that the backs of their businesses have been broken either by regulations or by the gratuitous expenses imposed on them by the European Union. They do not come to me whining and moaning and asking for Government help; they come to me bewildered that

Column 1010

Parliament allows the accretion of expensive bureaucratic items which are paid for with taxpayers' money. The bureaucrats who make the decisions that affect people so dramatically are paid handsomely from the money that we ask the British people to contribute towards the European budget.

I sometimes listen to my colleagues who tell me that the money that we give to Europe is only a small fraction of our budget--they say that Europe is not an expensive club at all. They ask: why grumble about it? Why not talk about the European Union's achievements? But I ask myself: what achievements? What are these achievements and why does the British population not appreciate them?

When I walk the streets of Billericay or other parts of my constituency or when I take a train from London to Cambridge, as I did on the weekend, why do people not boo at me for resisting the idea of this European organisation? Why do complete strangers compliment me on my resistance to giving any money to it? Why do the British people, foolish creatures that they are--almost 52 million of them, if I am to believe some of the speeches that have been made in the House--think that there is something wrong with our giving more money to this institution?

The people of Britain did not fully understand the deep and profound issues of Maastricht, but they understand this issue. They understand that their hard-earned money is being taken from them and given to an institution which we are told is riddled with fraud. But fraud or no fraud, I would not support giving more money to Europe because I do not think that we have a mandate to do so-- especially when we are presented with a fait accompli on the issue and we Conservatives are told that we face an enormous sacrifice almost for even querying whether we should give Europe more money.

It has been said several times before, but I want to say it again, that the House is founded on the belief that the people shall not be taxed without their consent; yet we are told by our own Prime Minister that that idea was lost when we made a deal with Europe and the Prime Minister decided, on the British people's behalf, that they would be taxed to enable the Government to give more money to the European Union. I think that that is profoundly wrong and it is not the sort of policy that people in my constituency send me here to support.

Many things have been said about those of us who resist the legislation. It is said that we are petulant or difficult, or perhaps slightly crazy. Those sorts of things were said about others in the past. The barons who resisted King John over the Magna Carta were criticised. King Charles came to the House, criticising those Members of Parliament who wished to prevent him from taxing the British people without their consent and demanding that they be brought before him.

Although those of us who resist the legislation may not survive as Members of Parliament, I think that we will have made our mark in putting up a strong case for refusing to give money to a European organisation that is clearly not loved by the British people. We are told that, whatever we say, it does not matter because the deal has been done already.

Mr. Rupert Allason (Torbay): Does my hon. Friend agree that a solution to the problem would be to hold a referendum? Even now, it might not be too late for the

Column 1011

Government to make a commitment to hold a referendum after the intergovernmental conference in 1996 so that we go no further, particularly in relation to a single currency.

Mrs. Gorman: I agree in principle with my hon. Friend: the people should be consulted about the issue. There has never been any consultation. We joined the European Union believing that we were entering a common market. Even in that, we have been disappointed because the European Community is not an open and free market; it is a cartel. Brussels dictates all aspects of our business life. The level playing field concept is nonsense, because competition is about comparative advantage.

When we joined Europe, we believed that we would be sharing in the economic miracle of the post-war European scene, but policies in Europe today are hell-bent on destroying even those conditions that made Europe appear attractive to Britain.

The European Community costs the British people £7 billion a year. None of us can grasp fully what that means. It means that 3.5p in every pound from taxation goes to the European Community. If we did not pay that money to Europe, we could halve VAT and do away completely with VAT on fuel. If we were so minded, we could increase old-age pensions by £7. Those would be enormous advantages for the British people, but we will not see them because the money is going elsewhere.

The British people will not thank us for giving money to pay for the extravagances of our European partners--whether they are roadways through Portugal or irrigation schemes in Spain. How does that advantage the British people to whom we are responsible? It does not advantage them in the slightest, and the British people understand that. They support those of us who resist the move to give more money to Europe.

I urge the House, although I realise that I am speaking to closed minds, to decide that we will not give the European Union a penny more, even if it puts its house in order. Until the British people exercise their enthusiasm through the vote, and by turning out to vote in European elections--we all know that fewer than 30 per cent. of our citizens do so--and until they are given a say in whether they wish to hand over authority to the Government of the day, we shall never be able to say that we are doing these things in the name of the British people. Therefore, I shall not support the measure tonight.

8.58 pm

Mr. Andrew Mackinlay (Thurrock): Tonight's debate is about much more than the Conservatives' difficulty being the Opposition's opportunity. The fact that we are debating a matter of confidence tonight was demonstrated by the speech of the hon. Member for Aldridge-Brownhills (Mr. Shepherd). If one listened closely to what he said, it was clear that his speech was a devastating indictment of the stewardship of the right hon. Member for Huntingdon (Mr. Major). Among other phrases that he used, the hon. Gentleman referred to those on the Treasury Bench as a cabal. Those are the people who are running our country and who have control of policy on Europe. Therefore, we are discussing the competence of the Government. Demonstrably, we and the people whom we represent have no confidence whatever in the Government.

Column 1012

When one listens to the tortured, agonising speeches of people such as the hon. Members for Aldridge-Brownhills and for Ruislip-Northwood (Mr. Wilkinson), one realises what a state the Government are in. It is our duty to say that they have had their chance. They have been running the country's European policy for 15 years. There are others who could do better. We would not start from here. [Interruption.] I shall be coming to the hon. Member for Wycombe (Mr. Whitney) in a moment. All the matters that hon. Members have complained about were to a large extent shaped by Lady Thatcher, the present Prime Minister and the Foreign Secretary. They are to blame. If there was a change of Government, in future my right hon. Friends would harmonise the interests of Europe with those of the United Kingdom. We could take a lesson from President Mitterrand, who combined and promoted the best interests of France and the international perspective. That is what is lacking in the United Kingdom's policy.

The hon. Member for Wycombe referred to the sapping and damaging references of his hon. Friends and said that they diminished our influence in Europe. Exactly so. That further underlines the fact that many Conservative Members are inadequate to promote the best interests of the United Kingdom and Europe.

Mr. Whitney: Will the hon. Gentleman admit that what most damages Britain's standing in Europe is the fact that members of his party and the Liberal Democrat party, who profess to be in favour of Britain's membership of the European Union and of the enlargement of own resources, will go through the Lobby tonight to vote against what they profess to believe in? What could be more damaging to British political integrity than that?

Mr. Mackinlay: I do not know where the hon. Member for Wycombe has been. The Prime Minister has made this a matter of confidence. Opposition Members believe that if we were given the opportunity of being on the Treasury Bench, we could do a lot better in promoting the best interests of the United Kingdom in Europe in future negotiations as one moves towards 1996.

Mr. Thomas Graham (Renfrew, West and Inverclyde): Will my hon. Friend give way?

Mr. Mackinlay: I have limited time, but as it is my hon. Friend, I feel obliged to give way.

Mr. Graham: Does my hon. Friend agree that if there was a general election in three weeks' time, we would be elected and we would sign the social chapter, which would put millions of people in Britain in a better position to support the aims of the Common Market?

Mr. Mackinlay: Precisely. Conservative Members do not understand that we want a slice of the action in the interests of working people. That is what they are being denied at present. We are paying the bill but not getting the benefits. That is largely because of the rather selfish interests of many Conservative Members and because our foreign policy is run by a nice man, but someone who is out of touch with the best interests of ordinary working people in Britain. The hon. Member for Ruislip- Northwood referred to the Prime Minister as a nice man, but went on to criticise him. The best that can be said about the Prime Minister

Column 1013

is that he is a nice man over-promoted. One of the leading members of Thurrock Conservative Association said on television last week that the Prime Minister was the Captain Mainwaring of British politics. He went on to use a term that I will not repeat in the House because it would be unparliamentary. Nevertheless, it reflected the yobbo tendency of the Conservative party.

The behaviour of the Conservatives, their approach to Europe and the comments of a former vice-chairman of the Conservative party about European colleagues are all on the charge sheet against the Government.

Opposition Members are obliged to vote against the Bill tonight to demonstrate a lack of confidence in the Government and to give those Conservative Members--many of whom I disagree with, but whose courage I respect--the opportunity to demonstrate that this is an important matter of principle.

Hon. Members suggest that it is cynical of Labour and the other Opposition parties to vote in such a way tonight, but our politics are adversarial and we have an obligation to frustrate and bring down the Government. That is the nature of things. I wish that it were not so-- [Hon. Members:-- "Oh?"] Yes, I happen to think that our adversarial system is barmy and that many reforms need to be instituted. As there has not been a referendum on the issue, the House must decide. We also have a duty to frustrate the Government. In other parts of the world, treaties are signed subject to ratification by the legislature and there is a presumption that it will examine fully the implications of the treaty. That is what happens in the United States. We do not have a system or a tradition whereby it is understood that the Executive might sign or endorse a treaty, but it is subject to endorsement by Parliament or the people. That is what we lack and it is another reason why those hon. Members who broadly support the concept of Europe should join those hon. Members who oppose the Bill.

The Government have no mandate for this legislation. That legitimately unites all Opposition Members with some Conservative Members, with whom we might disagree on some important details, but with whom we agree that a democratic mandate is necessary. The Bill will increase EU resources, but the Government's stewardship of existing resources has been sloppy. Forgive me for raising a constituency matter, but my area of Essex was entitled to objective 2 money, as were the constituencies of the hon. Members for Billericay (Mrs. Gorman) and for Southend, East (Sir T. Taylor). We were denied that money. The Government argued that that was due to the bureaucrats in Brussels, but this wrong also bears the fingerprints of clumsy handling by the right hon. Member for Hove (Mr. Sainsbury) who, as the Minister responsible for trade and industry, did not understand that Thurrock was in the Southend travel-to-work area. We were therefore denied the resources to which the social and unemployment problems on the north bank of the River Thames entitled us.

Ministers on the Treasury Bench have grossly mishandled the distribution of funds, to the great disadvantage of my constituents and those of many other hon. Members. Time and again, we come back to the fact that Members who occupy the Treasury Bench are arrogant and maladroit and should go. We are presented with that opportunity tonight, if we can encourage enough Conservative Members to join us in the Lobby.

Column 1014

I regret the fact that the Ulster Unionists feel unable to join us in the Lobby. They should bear in mind the fact that the Government's lack of negotiating skills has resulted in the absurd situation in which cohesion fund money is available for 26 counties in Ireland, but there is no comparable money for the Six Counties. That is profoundly foolish.

If my right hon. and hon. Friends had been in office they would have banged on the table in Brussels and argued that there was a special case for parity of treatment for all the 32 counties of Ireland, both north and south, and that cohesion fund money should be made available for the whole of Ireland. That is one more reason why I hope that members of the Ulster Unionist party will pause and reflect on the fact that they are sustaining a Government who are not promoting the best interests of the working people of Warrenpoint, Derry or Belfast.

Rev. Martin Smyth (Belfast, South): Will the hon. Gentleman also bear in mind the fact that there is an industrial policy in the United Kingdom which does not help us in the agricultural sector of Northern Ireland?

Mr. Mackinlay: I take on board the hon. Gentleman's point and I hope that cognisance will be taken of that by my right hon. and hon. Friends who, sooner or later, will occupy the Treasury Bench. I hope that the debate and the vote tonight will demonstrate beyond all doubt that the Government have lost the confidence of the vast majority of the people of this country, as will be demonstrated by the votes of all the Opposition parties apart from the Ulster Unionists. The Government are under notice that, sooner or later, there will be a collapse in their ranks which will precipitate a general election and the election of a Labour Government.

9.10 pm

Mr. Andrew Smith (Oxford, East): There have been some fierce debates this evening and the Opposition parties have taken part as well.

Let me make clear the principal differences between the amendment tabled by my right hon. and hon. Friends on the one hand and the position of the Chancellor, the Prime Minister and most Government Members who agree with them on the other. First, we say that this House has the right and duty to scrutinise and, as appropriate, to amend what is a substantial financial measure. The Prime Minister is effectively seeking to deny the House that opportunity. The Bill, he says, is perfect and the House of Commons--even hon. Members informed by our constituents--cannot improve on the flawless legislation that he has set before us.

Secondly, Labour says that the Government have not done nearly enough to combat waste and fraud in the European Union budget. The Prime Minister and the Chancellor say that they have done all that they can and they are happy to see the Bill pass into law without incorporating further action.

Thirdly, we say that the common agriculture policy is a wasteful and economically and environmentally damaging monstrosity which must be changed, root and branch. The Prime Minister seems to think that reform is coming along nicely.

Column 1015

Fourthly, we say that there have been developments since Edinburgh which warrant the House of Commons and the Government seeking further action to get European Union expenditure under proper control. On each of those points--scrutiny, waste, agricultural reform and developments since Edinburgh--the people of Britain and the true majority in the House agree with us, not with the Prime Minister. We speak for the British people, and he does not--it is as simple as that. That is why the House should pass the amendment tonight. Earlier, we had a truly extraordinary admission from the Chancellor under some considerable pressure from my hon. Friend the Member for Dunfermline, East (Mr. Brown). The Chancellor admitted to the House that he could not remember when he first knew about the £700 million increased estimates on this year's contributions to the European Union. Given that that money must be paid from the contingency reserve, and given that it represents fully one fifth of the contingency reserve--the new control total states that the contingency reserve is just £3.5 billion, and here we are talking about an extra £700 million--is not it staggering that the Chancellor of the Exchequer, who is supposed to be in charge of the nation's finances, cannot remember when he first knew that one fifth of his reserves had gone? No wonder so much money is wasted in Europe, when the Government are not controlling it properly in this country. [Hon. Members:-- "Where is he?"] Perhaps I shall say that again when the Chancellor comes in, as he ought to hear it.

My hon. Friend the Member for Dunfermline, East also set out how unprecedented it is for the Prime Minister to insist that every essential element of the Bill is so perfect that the House cannot improve upon it. Such an attitude, as hon. Members have pointed out during the debate, cannot be consistent with the right and duty of hon. Members to their constituencies, nor with the proper exercise of democracy.

The Prime Minister's treatment of his own hon. Friends offers us another sign of how woefully out of touch the Government are. Cannot the Prime Minister see how the people will judge his threats to his hon. Friends? They will ask what they are to make of a Prime Minister and a Cabinet who cannot carry their colleagues with them by persuasion; cannot convince by reasoned argument; cannot appeal to the usual party loyalty; and instead try with threats simply to bludgeon their way through. So divided are the Conservative party that the only weapon that the Prime Minister can use to create a semblance of unity is the threat of defeat at an immediate general election. The Prime Minister is not deploying persuasion or debating skills against his own Back Benchers, but the traditional Conservative weapon of coercion of the past 15 years, the threat of unemployment.

Will people say that such policy demonstrates that the Prime Minister is acting with success, based on authority and strength? No. They will say that this Prime Minister is a failure, who is acting on division and weakness. They will be right. Every time the Prime Minister deploys the political suicide dissolution threat--there may be more instances of that to come on the Bill and on votes on VAT which we hope to instigate--he should remember that by issuing that threat he does not make his position stronger, but weaker, because he reminds the country of the authority that he lacks. He should remember the more he

Column 1016

twirls the chamber of the Russian roulette revolver, the more he risks finding the bullet. Perhaps the immortal words of the right hon. Member for Kingston upon Thames (Mr. Lamont) were right, when he said that we all know that a suicide threat is a cry for help--that from the Prime Minister's former Chancellor.

The Prime Minister would do well to remember that threaten though he might his hon. Friends, intimidate as he has tried to do their constituency associations, at the next general election it is the people of Billericay who will decide on their Member of Parliament. Perhaps I should repeat that for the benefit of the hon. Member for Billericay (Mrs. Gorman), who is not listening, but perhaps the electorate will not choose her. The electorate will also decide whether they want to return a Conservative Government. The behaviour of the Prime Minister now will not help him when they come to make that decision.

The value of the House should be based on the fact that hon. Members have the opportunity to bring our constituents' concerns to bear on the great issues of the day. We can seek to persuade one another, set out our case to the wider audience in the country and scrutinise and amend legislation. The Prime Minister, however, is now trying to curtail that right. My hon. Friends and I have many differences with the arguments put forward by the so-called Euro-sceptics. I part company with those of them who believe that isolation within the European Union is a viable option for Britain. I disagree still more with those who believe that it would be a good thing for Britain to attempt to shape its destiny outside the European Union. That those hon. Members are voicing important concerns, held by many people in this country, which those of us who want close and constructive involvement in Europe should at least address, is undeniable.

One reason why the Maastricht treaty ran into trouble not just here but in Denmark, France, Germany and elsewhere is that the thinking, assumptions and constitutional ambition of the European political elite ran way ahead of the concerns and understanding of citizens throughout the European Community. The lesson for those of us who believe in the benefits of European co-operation should not be to attempt to dismiss out of hand, or crush with confidence motions, concerns about waste, over-centralisation, lack of democracy and the other imperfections of the European Union. Our task should be to show how those concerns can be answered and remedial action taken. That is precisely why our deliberations on the Bill should be informed by the amendment that my right hon. and hon. Friends have tabled this evening, and it is precisely the reason why the Government's version of the Bill needs to be amended in the way that we have suggested.

The Chief Secretary to the Treasury (Mr. Jonathan Aitken): Before the hon. Gentleman gets away with the conjuring trick of trying to present his amendment as a constructive measure to reduce fraud, will he answer the question that the shadow Chancellor failed to answer--will he admit that that is not a constructive amendment but a wrecking amendment, which would deny the progress of the Bill?

Mr. Smith: It is a very constructive amendment, framed in circumstances in which the Prime Minister has made tonight's vote a vote of confidence.

Column 1017

As I understand it, the Chancellor of the Exchequer argued earlier that this was a wrecking amendment because, if carried, the Bill would be lost and could not be introduced until another Session. I think that when the Chancellor said that, he had forgotten that the Prime Minister had made the vote a vote of confidence.

If the Opposition win the vote, there will be a general election; and at that general election, the Labour party will win; and after that victory, there will be a new Session of Parliament and a Bill will be placed before the House, not simply signing up to the Edinburgh agreement, but taking the measures to tackle waste and fraud and to reform the common agricultural policy--the things that are absent from the current Government's Bill.

Sir Donald Thompson (Calder Valley): Will the hon. Gentleman give way?

Mr. Smith: In a moment. Let me make a little more progress. As my hon. Friend the Member for Merthyr Tydfil and Rhymney (Mr. Rowlands) said, waste and fraud in the European Union are not confined to agriculture, as much of the debate has been. They happen in many other sectors. My hon. Friend cited the unacceptable waste that too often happens in the European Union overseas aid budget--it is especially tragic when part of that goes astray. Many other hon. Members have drawn our attention to the unacceptable and alarming fact that, when it comes to waste and fraud, things seem to continue to get worse rather than better.

The Chancellor attempted to rubbish claims that the recent Court of Auditors' report showed fraud running at anything like £6 billion a year. He can do so only because the Court of Auditors did not tot up all the things that they had identified throughout their report, but those things do add up, and they amount to billions of pounds. Wine production has increased by 20 per cent. since 1989, despite European Union expenditure of £1 billion to take vineyards out of production. German apple growers were paid more than £180,000 to dig up their trees, which had mysteriously grown back in place when the inspectors went to find out what had happened. There were no competitive tenders on the new European Parliament building in Brussels and the costs increased from £781 million to £1.42 billion. Sir Donald Thompson rose --

Mr. Whitney rose --

Mr. Smith: I give way to the hon. Member for Wycombe (Mr. Whitney).

Mr. Whitney: The hon. Gentleman said that wine production had increased. Is he aware that it has decreased by 34 per cent. since 1987-88?

Mr. Smith: That is not the figure in the Court of Auditors' report and I stand by the figure that I have given of a 20 per cent. increase since 1989.

Sir Donald Thompson: Will the hon. Gentleman give way?

Mr. Smith: No.

In reacting to the Court of Auditors' report, the Chancellor of the Exchequer, in radio interviews, and the European Commission's Secretary- General, have drawn a

Column 1018

distinction between fraud and financial mismanagement. Opposition Members would not go along with the Secretary- General in rejecting, as he did last week, what he called "media allegations" that fraud was widespread in European budgetary spending. He should take more notice of what the Court of Auditors say. The Chancellor, like him, should be--as Opposition Members are--as worried about financial mismanagement as fraud.

As my right hon. Friend the Member for Bethnal Green and Stepney (Mr. Shore) said, it is not so much the distinction between one and the other that matters, important though it is legally; the important fact is the sheer amount of money that is being wasted. We need to mobilise every pressure to get something done about it. A powerful signal should be sent to the Commission and our partners in Europe that people in this country, for years high net contributors to the European budget, are sick and tired of waste and corruption.

Sir Donald Thompson: For the past 20 years, every Labour Minister has said that Labour will win the next general election; none has kept that promise. Let me ask another question, however. The Opposition Chief Whip went to the Government Chief Whip and said, "We think that the Edinburgh deal was a good one, although we would have done better, but we will support it only if you introduce a simultaneous Bill to fight fraud." Why did not the Opposition introduce such a Bill? They acted as they did only because they wanted to defraud the electorate.

Mr. Smith: Much has happened since the Edinburgh summit, including a succession of Court of Auditors' reports revealing a consistently serious position.

In tabling tonight's amendment, my right hon. and hon. Friends and I were not expressing a new-found or sudden concern. Time and again, on the Floor of the House and in Committee, we have expressed our alarm at the lack of effective control on the Community budget and the need for decisive action not only to root out fraud and waste, but to gain recompense in instances where lax controls on the part of national authorities are to blame.

We advanced that view, for instance, in our submission to the Delors consultation on growth, competitiveness and employment in Europe. What, in their submission about competitiveness in Europe, did the Chancellor of the Exchequer and his right hon. Friends have to say about waste, fraud and corruption in the European Union? Absolutely nothing; so obsessed were they with their dogma and their opposition to the social chapter that they completely omitted in that important submission even to hint at the idea that waste, corruption or fraud--on which, according to the Chancellor, so much progress is being made--might somehow have an impact on competitiveness. We challenge the Government's position on the binding European convention that is being advanced for the protection of the Community's financial interests, to make such matters an offence against Community law. I ask the Paymaster General to tell us whether the Government will support that measure or oppose it. Will they simply rely on the joint action initiative, which I understand would not be binding?

Sir Teddy Taylor: Lest there be any misunderstanding about the wine situation, will the hon. Gentleman strongly advise hon. Members to read the Court of Auditors' report--they may not have read it yet; it became available

Column 1019

only today--which shows that expenditure on wine products increased by 45 per cent. between 1992 and 1993?

Mr. Smith: The hon. Gentleman makes a telling point. [Interruption.]

Earlier, someone asked what the Opposition parties were doing in the Chamber. The answer was "morbid curiosity", and I think that what the hon. Member for Southend, East (Sir T. Taylor) has just done to the hon. Member for Wycombe with the Court of Auditors' report provides a very good illustration of what I am talking about. Few would disagree with my hon. Friend the Member for Ilford, South (Mr. Gapes) and others that the CAP cannot be allowed to continue as it is. When the Chancellor was asked about it on a recent edition of the "Today" programme, he said:

"The Agriculture Ministers"--

that presumably includes his own Agriculture Minister--

"do make it too complicated."

That is one of the things that the Finance Ministers have pointed out.

We argue that the problem is not just that our Agriculture Minister, along with all the others, has made it too complicated; those Ministers have made it too expensive, too wasteful, and too open to fraud and abuse. That waste adds enormously to the industrial cost of the European Union, as well as to the agricultural cost: we urgently need reform.

I referred earlier to developments since Edinburgh. They form an important part of our arguments and of our reason for introducing the amendment. I have already referred to the Government's, at best, prevarication over the anti-fraud convention and the missed opportunities on the Delors submission. Something else, however, has changed since Edinburgh: the Government have introduced VAT on domestic fuel.

Some hon. Members may be unaware that the imposition of VAT on domestic fuel hits Britain twice--it adds not only to fuel costs of British families, but to our net contributions to the European Union, something that the Chancellor of the Exchequer seems to have missed out from his copious briefings and corrections to hon. Members for the debate.

Mr. Kenneth Clarke indicated dissent .

Next Section

  Home Page