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4.51 pm
Mr. Kelvin Hopkins (Luton, North): Whatever else is true about the European Union, there is certainly continuing pressure to speed up and intensify economic integration. Unfortunately for the European Union, some of the wheels are coming off the euro currency project at this very moment. Surely when wheels are coming off it is time to slow down or stop and think again possibly about the direction but certainly about the machine.
No doubt such heresies will not be aired at Nice, at least publicly, but in private discussions in the bars and restaurants some people will surely discuss the problem. The negotiators cannot all be so self-deluding as to pretend or believe that there is no problem.
The euro was flawed from the start. It has fallen in value by a third against the dollar since inauguration, and attempts to prop it up have failed. There are no signs of recovery. Then there was the Danish referendum. In spite of overwhelming political and media pressure and an 88 per cent. turnout, the Danish people voted to stay out of the euro, and rightly so in my view. Their political leaders glossed over that defeat by saying that in any case the Danish krone was shadowing the euro. That is the crucial point. The Danes are choosing and managing the value of their currency. They can change their policy when they wish, according to the needs of their economy.
They can appreciate or depreciate their currency--perhaps with difficulty, but they can do that outside the euro, whereas they could not do so inside it. Denmark has one of the strongest economies in Europe, with an excellent welfare state to which we in Britain would do well to aspire.Ireland plunged into the euro with enthusiasm, and has ridden a roller coaster since then. It now has an overheated economy with an uncomfortable rate of inflation. I am not by nature a deflationist, but Ireland's economy could well do with a little cooling at this point. Higher interest rates and a small currency appreciation would be helpful, but those options are closed off by euro membership. Ireland is staring heavy fiscal deflation in the face. That is not a happy prospect for the Irish people and the Irish Government. I imagine that the Irish economy is not helped by substantial net transfers to its economy, which give an added kick to domestic demand.
Perhaps the most significant country inside the euro is Germany, which entered the single currency at an overvalued parity. It needs to devalue a little against fellow member states to promote economic growth, but it cannot now do so.
A year or so ago, Janet Bush, writing in The Times, speculated that Germany might even leave the euro temporarily, devalue and go back in at a later stage. I do not think that that would be terribly popular with other member states, but it was a suggestion. At that time I thought it was highly unlikely, but things have moved on.
The Danish referendum result has also boosted opposition to euro membership in Sweden and Britain. Both have promised a referendum to their people, who are unlikely to support euro membership in the foreseeable future. There is also substantial scepticism about the single currency even inside the euro zone. Apparently, many Germans are upset that they were not permitted a referendum on the euro.
I have had the pleasure of meeting groups of Finnish journalists, and we have discussed Europe at great length. I asked, among other things, why the Finns did not have a referendum. One of the journalists said with amusement, "Well, we couldn't give them a referendum because they would have voted the wrong way." I suspect that may be true, although views change over time.
Most interesting of all is that the strongest economies in the European Union--Sweden, Denmark and the United Kingdom--are outside the eurozone. Is it not time to examine the whole euro project? Lord Desai, a euro enthusiast, has said:
- The euro is collapsing before our eyes.
The euro is a very sick duck--if it is not yet a dead duck, it is moving in that direction. It is time intelligently to consider alternative economic arrangements in Europe, and I hope that our Ministers and others will discuss, privately at least, what those alternatives might be.
4.56 pm
Mr. David Atkinson (Bournemouth, East): I want to raise two matters: first, the proposed EU charter of fundamental rights, and, secondly, the Europe we should foresee in the longer term, given the ambitions of a growing number of countries to join the EU.
I wholly share the concerns of my right hon. Friend the Member for Horsham (Mr. Maude) that the charter would represent an extra burden on British businesses and would threaten jobs. That would happen whether or not the charter were incorporated into a treaty. Even if it were not legally binding--as the Minister for Europe assured the House it would not be in yesterday's debate in Westminster Hall--it would, as many experts have said, inspire and influence the European Court of Justice and domestic courts.
My right hon. Friend and others have quoted a large number of people, including President Prodi and the Minister's French counterpart, Mr. Moscovici--I can spell his name as well as pronounce it--who have a completely different interpretation of the charter to the Minister.
My concerns go wider than the effect of the charter on business. It would unnecessarily complicate the working of the European Court of Human Rights in Strasbourg, as it would surely do to our own courts as they take on the monumental task of implementing the Human Rights Act 1998, which incorporates the European convention into British law, as the right hon. and learned Member for North-East Fife (Mr. Campbell) has said.
The Committee of Ministers in the Council of Europe fears that, as a result of the charter, there will be two rival systems of human rights protection in Europe. Because Europe will always be larger than the Union, and will include a certain number of non-member states, the Committee of Ministers warns against new dividing lines in Europe. However, it proposes a solution to the problem--accession to the European convention by the European Union.
That approach has repeatedly been backed by the other institutions involved: the European Parliament, the European Commission and the European Court of Human Rights. It would allow the European Court of Justice in Luxembourg to apply the convention without being inspired by the proposed EU charter.
When the Minister replies, will he make it clear that the Prime Minister will veto any attempt to make the charter legally binding? Were the charter to be agreed as a political document that would influence the courts--the Foreign Secretary suggested that that would happen at Nice--would the Prime Minister insist that the EU accede to the European convention, as has been proposed by the Committee of Ministers, of which he is a member?
That leads me to my second point. It is clear that, in the foreseeable future, the EU will include more than half the countries of Europe, given the applications that it has now accepted. That is bound to lead to questioning of the need for, and the future of, the other pan-continental institutions. Indeed, one--the Western European Union--is already being amalgamated into the EU. It must also be said, however, that both the enlargement of the EU and the incorporation of the WEU are taking place without much thought about the overall European architecture of the 21st century. There is no clear vision of how we
should--let me use the title of a report endorsed by the Council of Europe in January last year--be "Building a Greater Europe Without Dividing Lines".Europe today has six pan-continental institutions. Five were established as a result of the last world war, or in response to the cold war: the Council of Europe, the WEU, NATO, the EU and the Organisation for Security and Co-operation in Europe. The sixth, the Commonwealth of Independent States--which still exists, without being very effective--emerged from the break-up of the Soviet Union.
Each of those institutions is either composed entirely of Council of Europe member states, or composed of a majority of them. Each is committed to the principles of the Council of Europe: parliamentary democracy, human rights and the rule of law. Two of them exist to secure and defend those principles by force. I refer to NATO and the WEU, although now the EU will be involved. Each is served by its own parliamentary assembly, composed--except in the case of the European Parliament--of delegates from the Parliaments of member states.
At the beginning of the 21st century, it is unlikely that the existence of those institutions will continue indefinitely. Given that the next inter-governmental conference will not take place for several years, next month's Nice summit should embark on a debate about the future institutional architecture of Europe.
I believe that the Council of Europe has already proposed a framework for that debate, and for the design of the common European home that we should be envisaging. As I said, in January last year the Assembly of the Council of Europe adopted a report entitled "Building a Greater Europe Without Dividing Lines". It emphasised the need for the European Union to be recognised as the natural partner of the Council of Europe.
During the same session, the Assembly adopted two other reports. One, entitled "Europe: a Continental Design", emphasised the pre-eminent role of the Council of Europe, and said that it provided the most appropriate political framework as the pan-European forum of the future. The other report, entitled "The European Political Project", stressed the importance of the parliamentary dimension in the increasing co-operation and integration between European states in which the Council of Europe and the European Union are the main institutions. It pointed out that a democratic deficit exists in the work of the European Parliament.
To his credit, the Prime Minister has recently acknowledged the existence of that democratic deficit. In his speech in Warsaw, he referred to the need for a second chamber for the European Parliament. My right hon. Friend the Member for Skipton and Ripon (Mr. Curry) did not like that idea. Last week, the German Foreign Minister also called for a European Parliament of two chambers, one elected and the other comprising representatives of national Parliaments.
The concept of a second chamber composed of members of national Parliaments is one that several of us have advocated for some years. Some are now giving it prominence today, suggesting that it is the key to maintaining the WEU Assembly as the parliamentary dimension of the new European security and defence identity--something that the European Parliament cannot, of course, assume. In that case, the upper chamber of the
European Parliament would have to include MPs from 13 states that are not members of the EU, but that are associated with the WEU. It does not need much foresight to overcome that obstacle, as most of them are applying for membership and are likely to join the EU in due course.Much work is being undertaken in Europe to promote democracy, free elections and human rights in pursuit of a more stable and secure continent and the avoidance of conflict, but it is being done in duplicate, in parallel and, sometimes, in confusion by several institutions: NATO, the EU, the Council of Europe and the OSCE. Even the CIS has its own convention on human rights and provides peacekeeping forces in several areas of past and potential conflict. Therefore, it is no longer good enough to say that all those institutions have complementary and useful roles to play and that some could not be merged because they include non-European states such as the United States of America, Canada and five Asian republics of the former Soviet Union.
The time has come to consider how two or three of those institutions can be more effective than six. I see no reason why the European Union should not eventually be open to all Europe, including Russia and the Ukraine. We should have the vision to say that, but because it is the Council of Europe that Winston Churchill had in mind when he referred to a kind of United States of Europe; because it is the Council of Europe that is the home of the European Court of Human Rights, which is already Europe's supreme court; because it is the Council of Europe that is the home of the European convention on human rights, which is, in effect, the constitution of Europe--it is accepted by 43 member states--the Council of Europe should be the pre-eminent pan-continental institution, and its Assembly, made up of Members of national Parliaments, should be the second chamber of the European Parliament. I hope that that debate can be commenced under "any other business" in Nice next month.
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