TUESDAY 28 MARCH 2000
  
                               _________
  
                           Members present:
              Mr Donald Anderson, in the Chair
              Ms Diane Abbott
              Dr Norman A Godman
              Mr Eric Illsley
              Mr Andrew Mackinlay
              Sir David Madel
              Mr Ted Rowlands
              Sir John Stanley
              Dr Phyllis Starkey
              Mr David Wilshire
  
                               _________
  
  
                 MR KEITH VAZ, a Member of the House, Minister of State for Foreign and
           Commonwealth Office (Minister for Europe), and MR MARK LYALL GRANT,
           Head of European Union Department (Internal), Foreign and
           Commonwealth Office, examined.
  
                               Chairman
        1.    Mr Vaz, may I welcome you on your first appearance before the
  Committee.  Welcome also Mr Lyall Grant who is an old stager, a veteran who
  has been before the Committee on a number of occasions.  We look forward to
  a number of productive sessions over the years ahead, Mr Vaz.  Can I begin in
  this way: you as Minister for Europe will clearly be the person responsible
  over the period both of the Portuguese Presidency and of the French Presidency
  for the preparations for the ultimate Intergovernmental Conference.  Can you
  give us some idea of, one, what your personal role is, how much time this
  takes, what meetings you would normally attend, and also where we are now in
  terms of the timetable.
        (Mr Vaz) Can I say I am delighted to be here and to have with me Mr
  Lyall Grant, the Head of the European Department (Internal) who, as you know,
  is a veteran of these Committees.  He has lasted longer than most Euro
  Ministers.  I am pleased to be here to talk about the IGC.  Of course, as
  Minister for Europe I will have responsibility for what is happening at the
  IGC and the Foreign Secretary will take, as he has always done, a very close
  interest in these matters.  In the end it will be the Foreign Secretary who
  will lead for us on all the important negotiations and discussions.  We agreed
  at a very early stage that as far as the preparatory group is concerned - we
  have had three meetings so far with another taking place today as we speak -
  that our representative would be Sir Stephen Wall, our permanent
  representative at UKREP, the reason being that there are a number of meetings
  that are taking place and the preparatory group, as one would imagine from its
  name, prepares the ground and prepares the scope.  As far as where we are at
  the moment ---
        2.    Where personally would you come in in terms of the volume of
  meetings and the likely timetable over the next months? 
        (Mr Vaz) The Foreign Secretary and I will attend the JAC meetings in
  Brussels on a monthly basis.  It depends very much on what the French
  Presidency proposes to do as far as Europe Ministers are concerned.  Informal
  discussions are going on as to the next stage beyond the preparatory group
  meetings but there will be a keen political input from both myself and the
  Foreign Secretary.
        3.    Where are we now?
        (Mr Vaz) We have had three meetings of the group.  The fourth one, as
  I have said, is taking place today.  There was a brief reference to the IGC
  in the conclusions at Lisbon.  There will be a much more substantial report
  on the scope and much more substantial update at Faro in Portugal.  I am
  informed on a weekly basis by Sir Stephen Wall as to what progress has been
  made.  We were very keen to ensure as a government that the focus, the agenda
  of the IGC should be as tight and focused as possible because we are very keen
  to ensure this finishes by the end of the year.
        4.    Are we on track? 
        (Mr Vaz) We are on track.  We have made clear that if a whole shopping
  list is added to the Amsterdam leftovers we will not complete the work by the
  necessary time.
        5.    Is it your fear that some countries may wish to increase this
  shopping list so as to overload the conference and there may be delays? 
        (Mr Vaz) Not so much a fear.  Clearly countries are very ambitious in
  terms of what they would like to see discussed, but we are confident that the
  agenda for the IGC and scope of the IGC will remain focused on the three
  leftovers and we will proceed on that basis.  I think everyone is aware if we
  are not completed by the end of this year then the whole enlargement process
  will be held up and the purpose of the IGC is to prepare us for enlargement.
        Chairman:   That is precisely the point Dr Godman wishes to raise on
  enlargement.
  
                               Dr Godman
        6.    Thank you, Chairman.  Minister, I put it to you in the House the
  other day, as I have done to Robin Cook himself, that the process of
  enlargement is bedeviled by problems.  Without the radical and comprehensive
  reform of the CAP we cannot have enlargement otherwise we will finish up with
  a system of two classes of membership.  I also said there would be a problem
  with the free movement of labour in the period when most Member States, if not
  all, are tightening up on their immigration laws.  I seem to think you gave
  me a dusty answer on that one.  Also in relation to enlargement, can I ask
  just how many Directives and Regulations there are in force at this moment. 
  I know you will not be able to answer that question right now but if your
  officials could write to the Clerk that would be useful because I suspect they
  run to several thousands of documents.  Will all of these apply to these new
  Member States or will they be given a period of some years before all of the
  Directives and Regulations will apply to them? 
        (Mr Vaz) Dr Godman, I am sorry if you thought I gave you a dusty
  answer.  I hope I would never do that to someone as distinguished as yourself.
        7.    It was an extremely courteous one.
        (Mr Vaz) The issue of enlargement is important so far as the IGC is
  concerned of course because the IGC would not take place unless we were having
  enlargement, but they are two processes.  The negotiations with the applicant
  countries are going on, in my view, extremely well.  On a regular basis I see
  either European Ministers from the applicant countries or the chief
  negotiators on their behalf and they are all confident that the negotiations
  and timetables they have set themselves are going to be achieved.  You
  mentioned in the House and indeed today the issue of agriculture.  Clearly
  that is going to be an important matter when that chapter of the acquis
  communautaire is opened.  I am under no illusions and I am sure you are not
  that this is not going to be a tough chapter, but I do not see that process
  as in any way preventing us in the EU from doing the work which we need to do
  to prepare the institutions for enlargement.  That process is continuing under
  Commissioner Verheugen.  He has now been allocated additional staff to deal
  with the new six that have been given the go ahead since Helsinki.  So I am
  confident that process will continue, but you are right, these are going to
  be very tough negotiations and discussions.  As with any organisation you have
  to be quite clear what your expectations and ambitions are and the discussions
  will be quite detailed.  On the question of the number of regulations, I will
  certainly write to you with the information you require.
        8.    But these rules of membership, and there are many, many hundreds
  of Directives and Regulations, are there not, ranging from occupational safety
  of the crews of fishing vessels to farming, to working hours, are they going
  to be slapped across the doorstep of these new Member States, if they are
  successful in applying, or will they be allowed time to absorb these rules of
  membership?
        (Mr Vaz) When you join the European Union you have to join the Union
  as a full Member State and, therefore, you have to be able to accept whatever
  the rules are, as one would for any organisation.  The issue of transition is,
  of course, important.  We are not keen on long transition periods, however no
  accession has taken place so far as I can remember without some form of
  transition for some issue or the other. Certainly we had it when we joined in
  some areas.  We are keen to make sure that we do not have a situation where
  lots of exemptions and transitions are granted simply because we do not
  believe in a two-tier Europe, we believe if you join then you should join with
  all the rules and regulations that apply to other Member States applying to
  you.  I am quite certain that countries will be negotiating on these points.
        9.    Finally, you see no problems with the free movement of labour in
  these days?
        (Mr Vaz) I do not.  I think that we have a robust policy and it is a
  policy that is working.
  
                               Chairman
        10.      Minister, you mentioned the Agricultural Dossier.  It is so
  complex in respect of Poland that some applicant countries fear that they will
  be ready at a point when Poland will not be ready and they may be held back
  as a result.  How do you respond to that?
        (Mr Vaz) Chairman, you are absolutely right, there are fears about
  individual chapters of the acquis and other countries have their fears.  This
  is not a process which in any way is exclusive.  If a country is ready and has
  met the terms and criteria they will be allowed to join.
        11.      On their own or in a cluster?
        (Mr Vaz) I think we will have to look at the discussions, the
  negotiations, as they go on.  No single country will have a veto over other
  countries joining, really it is very much up to the speed at which they
  negotiate.  I am confident, having spoken to Commissioner Verheugen on a
  number of occasions, that he is aware of the problems and is keen to make sure
  that any of the applicants that have any difficulties come forward and discuss
  them as soon as possible.
  
                            Sir David Madel
        12.      The Government's White Paper on the IGC in relation to qualified
  majority voting ruled out six areas where we would not accept QMV:  treaty
  change, taxation, border controls, social security, defence and own resources. 
  The Commission keeps going back to QMV on taxation.  Are you having any
  progress in saying to the Commission "please stop pursuing that"?  What is the
  state of play?
        (Mr Vaz) I do not think it is our job to tell them to stop doing
  something.  You are quite right, the Commission, Sir David, has come up with
  a number of proposals on this and our position remains absolutely clear, it
  is set in stone, it is as is described in the paper issued on 15 February,
  those areas are not up for discussion.  What we have said generally on QMV is
  that we will look at QMV on a case by case basis but not in those areas that
  I have defined.  We are not afraid of QMV in the other areas, we are ready to
  look at the proposals.  We think that we would not have had the Single Market
  without QMV and certainly previous Governments have allowed QMV as a result
  of the Single European Act and the Maastricht Treaty.  I think we need to be
  clear that the Commission is entitled to put forward proposals and we are
  equally entitled to reject them.
        13.      It will be better if we try to proceed on a harmonious route. 
  To that extent the Commission produced its own document adapting the
  institutions to make sense of enlargement and suggested various things which
  could be QMV.  One has the measures to combat discrimination on the grounds
  of sex, race, etc, the article taking up the pursuit of activities of self-
  employed persons.  On that list for adapting the institutions does the
  Government have any objection to QMV extended, there which of course would
  please the Commission because it was their idea in the first place?
        (Mr Vaz) I think we want to study all the proposals that have been put
  forward.  We have made it clear where our bottom line is.  We are happy to
  look at any proposals that have been put forward and hear the arguments for
  them.  Clearly we cannot control, nor do we seek to control, what the
  Commission says.  There will be lots of discussions.  That is the whole
  purpose of having this very lengthy process, it is going to last a year and
  it is going to result in a lot of discussions and negotiations.  We are happy
  that they should put their views forward.  We will be very tough in defending
  our national interest in dealing with all these issues.
        14.      The big six, if I can call them, no change on that, but as far
  as the ones I have mentioned, there were only two but there are others,
  basically the Commission must wait patiently until the Government has made up
  its mind?
        (Mr Vaz) I think so.  We have made certain points publicly about the
  way in which the European Court of Justice operates, for example the rules of
  procedure which everyone believes should be subject to good and long and
  detailed discussion, and the appointments to the court.  I think that we will
  need to look at each particular case very carefully and make a decision on
  that basis.  It is early days.
  
                              Mr Rowlands
        15.      I would like to pursue the point made by Sir David.  The new term
  that has recently crept in is "QMV in the fields of tax and social security
  relating to the proper functioning of the internal market".  That is the
  phrase that we see in the Presidency documents and indeed in the Commission's
  supplementary document.  Are there any tax or social security measures which
  you would see, or the Government would see, are in fact part and parcel of the
  proper functioning of the internal market and, therefore, could be subject to
  QMV?
        (Mr Vaz) No.  We have made our position quite clear on these issues,
  it is clearly set out in the White Paper on 15 February and we are not
  changing our position on that.
        16.      In that case, Minister, I was a bit puzzled by the Prime
  Minister.  If I can take you back to yesterday's statement and his answer. 
  He was pressed by the Leader of the Opposition who asked why did he commit
  himself to the so-called tax package, tax harmonisation in another name, to
  which the Prime Minister responded in column 26, "On the tax package we are
  committed to finding agreement, and I believe that we can do so on our terms. 
  We are not against everything in the tax package.  Indeed, we are strongly in
  favour of some parts of it.  We want tax laws that are used as a hidden state
  subsidy to be removed, and that is a major part of the tax package."  That
  implies there are taxes, or part of the tax package, which we are willing to
  see become part of the QMV arrangements.
        (Mr Vaz) No, that is not what the Prime Minister said.
        17.      My interpretation.
        (Mr Vaz) Your interpretation is not what the Prime Minister said.
        18.      Tell me what the tax package is then.
        (Mr Vaz) The tax package is something, as the Prime Minister said
  yesterday, which is a matter that is being discussed and we will respond as
  positively as we can to the proposals that have been put forward.  The
  Chancellor has made that position absolutely clear.  When we are in a position
  to put those views forward we will.  The context is clear and the context is
  we believe there are certain areas that are not up for grabs and not to be
  subject to QMV.  
        19.      I understand that.
        (Mr Vaz) Where there are proposals that have been put forward and we
  have been asked to respond to them we will do so, and the Chancellor will do
  so.
        20.      May I press you.  I would like to identify those taxes that in
  the terms of the Prime Minister are part of the hidden subsidies which need
  to be removed.  What are these taxes?  Can you name the specific taxes that
  we are talking about?
        (Mr Lyall Grant)           Perhaps I can add to that, Mr Chairman.  The tax
  package is made up of three separate items.  There is what is called the
  Withholding or Savings Tax Directive and then there is the Interest on
  Royalties Directive, which is such an example as you have mentioned where we
  think co-ordination to cut out double taxation between EU Member States is a
  sensible idea.
        21.      Interest?
        (Mr Lyall Grant)           Taxation on interest and royalties.  It is taxation
  between a head company and a subsidiary company in another Member State.  The
  third element is a Code of Conduct on unfair taxation which is a group being
  chaired by Dawn Primarolo from the Treasury.  Those three elements make up the
  tax package and we are in favour of two elements of that package, the interest
  on royalties and the Code of Conduct group.  We have difficulties with the
  Draft Directive on the withholding tax, as you know, as it is currently
  phased.  The key point about those three elements is that they ought to be
  agreed by unanimity.  The Government does not say we do not want any tax
  harmonisation or any tax co-ordination.  What we do say is if there is going
  to be some form of tax co-ordination it has to be by unanimity; it should not
  be by qualified majority voting.
        22.      Once one agrees that these two areas are by unanimity to be a
  part of the European Union from then on they are QMV and any alteration or
  amendment in that area would be subject to qualified majority voting?
        (Mr Lyall Grant)           They would all be subject to unanimity?
        23.      Any subsequent changes would remain subject to unanimity.
        (Mr Lyall Grant)           That is correct. 
  
                           Sir John Stanley
        24.      I would just like to pursue Mr Rowlands' point with just one
  further question.  Do we understand therefore that there is no tax that this
  Government is prepared to see settled by a QMV process in the European Union?
        (Mr Vaz) Yes, that is exactly what I said in the House during the last
  questions.
        25.      Including withholding tax? 
        (Mr Vaz) Yes.   Yes means yes.
  
                              Dr Starkey
        26.      Can I ask a question about some non-treaty reform.  Do you accept
  the recommendations that have been made by a report that is suggesting that
  the significant package of non-treaty reform should be agreed at the end of
  the IGC?
        (Mr Vaz) I think we need to look, Dr Starkey, at what is left at the
  end of the IGC.  What we are very keen not to do is to burden the agenda to
  such an extent that we do not deal with the leftovers from Amsterdam.  These
  are the core issues that we have to get completed.  There is a view which
  fewer countries are now pursuing that there will be this huge amount of time
  left over which will allow us to discuss everything under the sun.  This
  simply will not happen.  We need to look at the IGC process.  Frankly, I think
  the Faro conference is a good time to assess the progress of it and by then
  we will know what the scope is.  There are other countries that want to put
  other things in but at the moment I think our position must remain to get a
  full discussion and agreement on the three issues which are substantial
  issues.  These are not minor issues, they are substantial issues, and when
  that is completed then we will see if there is any scope available.  My view
  and  the Government's view is that there is no scope available for any major
  discussions.
        27.      There is one area where this Committee has had considerable
  concern which is difficulties in the administration of EU budgetary payments
  to NGOs and other organisations and indeed also the problems that there have
  been with the TACIS and PHARE technical assistance programmes.  I think in
  almost every investigation that we have done recently this problem has
  recurred about the inefficiency of the TACIS programme in particular.  There
  is not anything at present on the IGC agenda to address these administrative
  weaknesses.  Would it not be a good idea to resolve these sort of problems
  with some urgency to make sure that the current functioning of the EU is as
  efficient and as effective as possible?  Another example is Kosovo where there
  was a health NGO which had been given six weeks to produce drugs for Kosovo
  relabelled in all the languages and distribute them and it had taken more than
  six weeks to get the money out of the EU.
        (Mr Vaz) That is not within the scope of the IGC, as you correctly
  identified Dr Starkey, but I think one must not regard the discussions in the
  IGC as the only thing happening in the European Union at this time concerning
  reform.  The reforms that have been set out by Neil Kinnock and Romano Prodi
  the way in which the European Union and Commission operate are reforms that
  can actually look at the financial and administrative details you have just
  mentioned and are not something that we are going to discuss within the scope
  of these meetings.  There is no reason why they cannot be addressed by the
  so-called Kinnock reforms and I am sure they will be looked at it.
        28.      Will you be keeping under review whether they are adequately
  addressed by that mechanism and, if not, would you maybe look again?
        (Mr Vaz) If we were not keeping them under review we certainly will be
  now you have raised them at this Committee.
  
                              Mr Wilshire
        29.      I want to go back for a moment to qualified majority voting
  because I do not think we can reasonably leave it where we did.  Knowing the
  Minister's enthusiasm for modern technology I had a look at the Labour Party's
  website on this matter and it says there that "we shall defend our veto in
  every area where it is the British interest to do so."  There we have a very
  clear Government statement of when it is in our interest.  I am nervous
  because having made that statement the Government has then abandoned it in 15
  areas already.  I do not think the answer Sir David got goes far enough.  Sir
  David, Minister, recited to you the six areas of principle where you have said
  no concessions, but if you go back to adapting the institutions to make a
  success of the enlargement, if you go back to the document produced by the
  Commission, I have found at least 22, in my judgment, issues which fall
  outside your six areas of principle and what I would like to know is whether
  you agree with me that those items fall outside.  If you are saying, "We are
  going to listen and then decide", if they are within your six surely you are
  not going to listen before you decide because you have made your mind up? 
  There are 22 areas which fall outside.  Chairman, you will not let me read out
  22 one by one, but if I give you that list of 22 will you confirm to this
  Committee that my judgment is correct that they do not fall within your six
  areas? 
        (Mr Vaz) Mr Wilshire, first of all I have not had the pleasure of
  looking at the Labour Party's website but I certainly will do so after this
  meeting.
        Mr Wilshire:   It is a fascinating place to go.
        Mr Mackinlay:  You both need to get a life!
  
                              Mr Wilshire
        30.      It is in the fiction section, Minister, if you really want to
  know where to look for it. 
        (Mr Vaz) I can only repeat what I, the Foreign Secretary and the Prime
  Minister have said on many, many occasions.  I know it is boring but I am
  going to have to repeat it again and that is we will examine qualified
  majority voting on a case-by-case basis.  I have not said at the Committee
  today or at any other stage that in all other areas other than the six areas
  I have mentioned we will get qualified majority voting.  What I have said is
  that we will look at the situation and look at each area on a case-by-case
  basis and have a discussion.  It is not this Government that extended
  qualified majority voting a record time; it was the previous Government that
  extended it 42 times under the Single European Act and the Maastricht Treaty
  and it was the Shadow Foreign Secretary of course who signed the Maastricht
  Treaty.  So we are very conscious that these are issues that need to be looked
  at very carefully.  I cannot negotiate the terms of reference of each area at
  this Committee today, you would not expect me to.  Reciting 22 areas and me
  saying yes or no to them is not going to get us very far because we will start
  that procedure when we discuss these matters.
        31.      I heard what the Minister said but that is not what I asked him. 
  Two things that arise from what he has just said, Chairman.  First of all, you
  are saying that you are prepared to consider all matters put before you but
  at the same time you are saying there are six areas where you are not prepared
  to.  Can we be clear.  If a proposal to extend QMV falls within one of those
  six categories are you saying you are still prepared to consider it or are you
  going to say, no, on principle we are not prepared to consider it?  Which is
  it?
        (Mr Vaz) We will do what every Government has done on these matters
  and that is look at what is in the national interest.  What we have set out
  in the IGC White Paper of 15 February is a clear statement about six core
  areas which are matters of concern and have been raised on a number of
  occasions, indeed they have been raised today within a few minutes of this
  evidence session beginning.  What I have said is that in all the other areas,
  Mr Wilshire, we will examine QMV on a case by case basis. We have no fear
  about the QMV.  If you look at the figures, Mr Wilshire, last year we were on
  the losing side only twice and in the year before we were on the losing side
  three times on QMV.  QMV benefits the national interest.  In all those other
  areas we will look at it on a case by case basis.  I am not going to tell you
  today whether we have made a decision on them because the negotiations and
  discussions have not even begun.
        32.      So there are no circumstances under which this Government will
  agree to any exception if that falls within the definition of your six, is
  that what you are saying to us?
        (Mr Vaz) Yes.
        33.      Fine.  So it would be possible to determine very early on whether
  a proposal made by the Commission fell within that category or not?  That is
  all I am asking you to do, to say do these 22 fall within those six or do they
  not, not whether you support them or not.  That is all I am asking you to say
  and will you do that by supplying the list?
        (Mr Vaz) I do not know because the first thing is I have not read the
  source of your information, which is the Labour Party's website, which I do
  not regard, I am afraid, splendid though it must be, as the Ark of the
  Covenant of discussions on the IGC.
        34.      But you have read the Commission's document.
        (Mr Vaz) Indeed I have read the Commission's document.
        35.      So you know the 22 items.
        (Mr Vaz) I have read many, many documents since I became the Minister
  for Europe and the Commission produces many documents on these areas.  I can
  only give you the same answer - I am sorry to be boring and pedantic - which
  is that we will look at QMV on a case by case basis.  We do not fear QMV in
  certain areas for the simple reason, and I have given you one of them, the
  European Court of Justice rules on procedures and appointments, that it is
  good for Britain in some areas.  We will do what is in the national interests
  of this country.  We are in Europe to work with our colleagues but also to
  defend the national interest.
        Mr Wilshire:   Thank you, Chairman.  I hope you will supply the list and
  see what answer we get.
        Ms Abbott:  It is a great pleasure to have you in front of us, Mr Vaz. 
  We have counted your colleagues in and we have counted them out and we expect
  to have you in front of us for many years to come.
        Chairman:   That is just the lead in, wait for it.
  
                               Ms Abbott
        36.      I want to ask you about Austria and whether the measures taken
  against the Austrian Government are going to have any effect on the workings
  of the IGC?
        (Mr Vaz) Thank you very much for your very kind comments, Ms Abbott. 
  Can I repeat that I hope when I appear here you will be on the Committee on
  those occasions also.  The situation on Austria is clear.  We have said to
  Austria that we will judge the Austrian Government by its actions and by its
  deeds.  I have not sensed any attempt by Austria to in any way endanger the
  process of the IGC.  Austria has made it clear through the statements of its
  Chancellor, who was previously the Foreign Secretary of Austria, that they
  support the enlargement process.  I have no reason to believe that position
  has changed.
        37.      So when on 31 January Portugal informed the Austrian Government
  of a statement which had been agreed by the Heads of State and Members of the
  EU that "... in the event of a government being formed which involves the
  FPO..." the following events will happen.  "Governments of XIV Member States
  will not promote or accept any bilateral official contacts at policital level
  with an Austrian Government integrating the FPO; There will be no support in
  favour of Austraian candidates .... Austrian Ambassadors in EU capitals will
  only be received at a technical level."  What was the sense of all that?
        (Mr Vaz) The point was that as far as Austria was concerned, with a
  coalition partner espousing the views put forward by Mr Heider, who was the
  leader of one of the partners, it was important that the European Union set
  down certain benchmarks over the way in which it should treat a country, not
  a people but a country, a government, that had espoused the kinds of
  statements that Mr Heider had.  Those measures were important because it made
  it clear to all that we would not tolerate the kind of language that Mr Heider
  had used.
        38.      It was not about Mr Heider, it was about his party, his party's
  platform.  It was not about an individual, it was always about the party's
  platform.
        (Mr Vaz) You are absolutely right, Ms Abbott, but they still remain
  part of the coalition.
        39.      Are you saying that this statement is a dead letter, that it will
  have no effect on the workings of the IGC?
        (Mr Vaz) No.  There are two different points here.  The statement is
  not a dead letter, it has been followed to the letter.  As Minister I am
  following the points that have been raised and in no way has that affected the
  workings of the IGC because Austria, in the statements that it has made, is
  committed to enlargement.  The IGC exists because of enlargement.  If we were
  not enlarging we would not be going through the IGC process.
        40.      The statement was not about enlargement, the statement was quite
  clear:  "accepting any bilateral official contact ... no support in favour of
  Austrian candidates".  Are saying that this statement of 31 January was just
  words and it has not affected the workings of the EU in any practical way?
        (Mr Vaz) It was not designed to affect the workings of the EU, it was
  designed to make a very clear statement to the Government of Austria that if
  it went back on the arrangements that it had made when it was formed, the
  principles upon which it was formed, if it in any way echoed by its deeds the
  words of Mr Heider then that would be viewed very seriously.
        41.      No, with the greatest respect that statement is not conditional,
  that statement is excluding:  "In the event of a government being formed which
  involves the FPO..." the following things will happen.  What you are telling
  this Committee is that this statement was just words and has had no effect in
  practice on the workings of the European Union?
        (Mr Vaz) No.
        42.      It was a statement merely for effect, that is what you are
  telling the Committee?
        (Mr Vaz) I can assure you, Ms Abbott, it was a very important
  statement.  It was the first time that the European Union ----  I am sure you
  would agree with the principles behind the statement.  It was important that
  we made it clear as a European Union, the 14 countries working together under
  the Presidency, that we had a position to take because of the inclusion in the
  Government of Austria of this party.
        43.      I understand that.  If the statement had no effect in practice
  it was really just hot air.
        (Mr Vaz) No, it was not hot air, Ms Abbott.  It has had the effect of
  making it clear to the Austrian Government what our position is because they
  have included a party like the party that Mr Heider led.  It has not affected
  the workings of the European Union because the Head of Government of Austria
  still attends the meetings, clearly as he did at Lisbon.  So the workings of
  the IGC are not affected.  The bilateral contact which you have mentioned is
  an extremely important way of showing our dissatisfaction with what has
  happened.
  
                              Mr Wilshire
        44.      What do the Austrian Government have to do for the 14 to rescind
  that decision?
        (Mr Vaz) That is not a matter for the IGC.  I think that is a matter
  for the Heads of Government to discuss and we will discuss it.
  
                               Ms Abbott
        45.      What is the UK's position on that?
        (Mr Vaz) I believe that it is important that we should judge Austria
  by its deeds and by its actions and that is exactly what we have been doing.
  
                              Dr Starkey
        46.      For the record, Mr Vaz, can you clarify that actually it is not
  just Mr Heider alone, the platform of the Freedom Party explicitly rejects a
  multi-cultural society and has a cultural programme which is explicitly and
  exclusively for the German Austrians?
        (Mr Vaz) Indeed.
        47.      That is not consistent with European values.
        (Mr Vaz) You are absolutely right.  Why I am particularly proud of the
  fact that the 14 countries has worked together on this and issued a statement
  is that it is important that we should have a benchmark on the values of the
  European Union.  This is what we said at the time and it remains the case
  because, as you have said, Mr Heider may have resigned as the leader but the
  platform remains.  That is why the decisions that we took at the end of
  January still apply.
  
                               Ms Abbott
        48.      I want to talk a little bit about the balance between the
  Council, Commission and Parliament and ask you if there is any change in the
  institutional balance between the Council, the Commission and the Parliament
  envisaged at the next IGC?
        (Mr Vaz) No.  As you know, in the end the position remains on
  accountability that the decisions are made finally and formally at the
  European Council meetings.  Ministers are accountable to Parliament.  Indeed,
  when he came back from Lisbon the Prime Minister made a statement to
  Parliament on what he said and did at Lisbon.  When we have a Treaty at the
  end of this process it will have to be ratified by the national parliaments. 
  It is a difficult balance always between competing power bases but we are
  under absolutely no misapprehension that in the end the buck stops with the
  politicians, it stops with the ministers.
        49.      Is the IGC likely to result in greater power for the European
  Parliament?  What is the Government's view of the proposal from the Commission
  that some MPs may be elected on an EU-wide list?
        (Mr Vaz) As I have said with all Commission documents and proposals,
  we will always be happy to look carefully at what the Commission says.  Our
  view in terms of the Parliament is that a ceiling of 700 is an acceptable
  position.  We do not envisage this IGC resulting in any increase in the power
  of the European Parliament.  There is no move among Member States to ensure
  that that happens.
  
                               Chairman
        50.      What about Europe-wide lists with no serious accountability to
  constituents?
        (Mr Vaz) Mr Anderson, that is almost a leading question.
        51.      With all respect, I am not in a court of law.
        (Mr Vaz) I can assure you that I am quite happy to be led on this.  I
  do not believe that that is a palatable idea. 
  
                             Mr Mackinlay
        52.      Just a quickie and it is not semantics.  Mr Vaz, you said it
  would have to be ratified by the national parliaments.  Here, alas, we do not
  ratify treaties; we only pass the legislation consequent on the Treaty and I
  wish to remind you of the fact that we will be unique among all the other
  Parliaments who do ratify treaties.
        (Mr Vaz) I am most grateful, Mr Mackinlay, for that clarification.
        Mr Mackinlay:  But it will change one day! 
        Dr Godman:  When you are Prime Minister!
  
                              Mr Illsley
        53.      I have two unrelated questions, if I might.  One is to bring you
  back, Minister, to the track you started off on with regards to the agenda. 
  I have listened to you say that we would like to keep a tight agenda and
  concentrate on the Amsterdam leftovers and not fill up the agenda with other
  issues.  I just come back to the idea that if we have not been able to agree
  these issues previously, what is the prospect of getting agreement this time? 
  I presume this is why the British Government does not want to extend the
  agenda thus far.  What problems do we see in getting agreement on the three
  main issues of the Amsterdam leftovers?  If other countries are willing to
  bring forward other items to the agenda, do they see themselves getting
  agreement on the three issues far more easily than we envisage it if you
  understand my point?
        (Mr Vaz) I do understand your point, Mr Illsley.  As I have said, some
  Member States came to this process wanting to shove in as much as they could. 
  No one now is under any misapprehension.  We are now at the end of March.  We
  want to produce a good report for Faro in Portugal which will be in June.  The
  French then take over and practically the most important work is going to be
  done then.  No one is under any misapprehension that we have to get on with
  it and we have to start by ensuring that those three crucial areas, which are
  going to take an enormous amount of time, discussion and debate, in my view,
  are dealt with first and I think Member States understand that, which is why
  there is a kind of acceptance that we have to have a focused agenda.
        54.      I am sure this Committee has taken evidence previously from your
  colleagues and we have been told that the actual options for the Amsterdam
  leftovers are on the table and it is simply finding the political will to
  accept one in each area and say this is it.  Everyone knows the arguments; it
  is going to be who has got the guts to take the decision.  Do you agree with
  that?  Obviously not because you are talking about extending beyond June and
  into the French Presidency.
        (Mr Vaz) I do not think there is any absence of guts on this issue. 
  I think people do realise that we have got to sort it out.  There are a number
  of countries who want to join the European Union and Poland, Hungary, the
  Baltics, all of these countries are watching very carefully what we are doing. 
  We do not want to delay this process because it was the United Kingdom and our
  Prime Minister who was at the forefront of the campaign for enlargement.  We
  have put forward proposals and models and they have been discussed.  Sir
  Stephen Wall, our representative, is doing a superb job and I think we are
  very well-placed to have an influence over the way the debate goes forward. 
  I do not think anyone is being a shrinking violet on this.  People have their
  agendas and are ready to have a good old discussion about it.
        55.      I believe the idea of a European prosecutor is likely to be on
  the agenda of the IGC.   Is that likely to extend to corpus juries and a
  Europe-wide legal system or is it simply going to be confined to a prosecutor
  and issues of fraud within the European Union.
        (Mr Vaz) As you know, the idea of a European prosecutor was rejected
  at Tampere.  It is extremely difficult to have a European-wide prosecution
  system.  As you know, in Barnsley the system is totally different from
  Greenock.  There are two jurisdictions in the United Kingdom itself.
  
                               Dr Godman
        56.      He has just disassociated himself from me on the basis of your
  comment about there being two legal systems within mainland Britain.  You are
  absolutely right. 
        (Mr Vaz) To that extent, it is so different.  I do not see in the
  discussions that I have had with my fellow European Ministers a huge move to
  put the European prosecutor on the agenda.  I think we have dealt with it. 
  We had a very impressive conference at Tampere.  We looked at justice and home
  affairs issues and I do not see that running.
        (Mr Lyall Grant)           There has been some discussion of this issue.  It is
  fair to say that there was one Member State in favour, one query and 13
  against, so I think it is safe to say that this will not be part of the
  agenda. 
  
                           Sir John Stanley
        57.      Can I continue a little bit further the European public
  prosecutor proposal.  Minister, do you agree that the proposal as formulated
  by the Commission would involve establishing both European-wide criminal court
  procedures which would override in this particular area national criminal
  court procedures and also European-wide criminal legislation in this area
  which equally would override national criminal legislation?  
        (Mr Vaz) No, I do not see it at all, Sir John.  That is why we do not
  support it.
        58.      Sorry, what I put to you was do you agree that that is the
  Commission's proposal?
        (Mr Vaz) I think that there is an attempt by not just the Commission
  but by, as Mr Lyall Grant has said, another Member State to try and get this
  back on the agenda.  There is a view in the minds of some people, maybe the
  Commission, that you can have this kind of system where there is an overriding
  overarching prosecutor and one system that applies to all countries.  I am
  saying it cannot work.  We do not support it and it cannot work for the reason
  we have so many different jurisdictions in our country and therefore to extend
  it beyond our country to other countries it just cannot work.  That does not
  mean that we will not co-operate with other countries in order to make sure
  that our criminal system works with theirs.  If there is any information
  available in order to track down criminals we will share this, of course we
  will.  The whole basis of what the Prime Minister has said on drugs is
  co-operation between countries, but we do not support the proposal.  I am not
  quite sure whether it crystallises exactly as you have discussed today as
  being the Commission's proposal.  If it did, I would not support it.
        59.      Minister, I am sure you have read the Commission's proposal and
  I refer you to page 16 of it.  Can I just ask you again.  There are two quite
  separate legs to this proposal which this Committee has pursued informally
  with Commissioner Barnier.  The first is a proposal to establish European-wide
  criminal court procedures which would override national criminal court
  procedures.  The second leg of the proposal would be to establish
  European-wide criminal legislation which would override national criminal
  legislation.  What I am asking you is to confirm that that is the case, as I
  think is very clearly set out on page 16 of the Commission's document.  Can
  you confirm that there are those two legs.
        (Mr Vaz) Sir John, if it is clearly set out you do not need me to
  confirm it.
        60.      I do need you to confirm it because you have just described
  yourself as the Minister for Europe and, therefore, we are looking to you, not
  just a Member of the Select Committee, to give your own view as to what the
  Commission is proposing.  I ask you, do you agree that is what the Commission
  is proposing?
        (Mr Vaz) Sir John, if that is your interpretation of what the
  Commission is proposing then we disagree with it.  I think really this is a
  question that you need to put to the Commission, not me.
        61.      Are you disagreeing with my interpretation or are you disagreeing
  with the proposal?
        (Mr Vaz) Both.
        Sir John Stanley:          If you disagree with my interpretation could I ask you
  then to put in front of you page 16 of the Commission's proposal.
  
                              Mr Illsley
        62.      It is only on fraud.
        (Mr Vaz) No, because I do not have page 16.  I am afraid I do not go
  around carrying the Commission's proposals with me.
  
                           Sir John Stanley
        63.      Could you then give a further note to the Committee in the light
  of the transcript of this exchange and give us your view as to whether the
  Commission is proposing both supra-national criminal court procedures and also
  supra-national criminal legislation on this particular area?
        (Mr Vaz) I will certainly give you a note on it.  If you want me to
  interpret a Commission document I will certainly do so.
        64.      Minister, do we understand from what you have said that the
  British Government is opposed both to the procedural leg of this proposal and
  also to the criminal justice leg of this proposal?
        (Mr Vaz) As you put it, yes.
  
                               Chairman
        65.      But it is clear that there is no serious political will within
  the Council of Ministers in favour of that proposal?
        (Mr Vaz) No, Chairman.  We discussed this at Tampere and that was the
  view then and it remains the view now.
        66.      And the suggestion is confined to the area of fraud?
        (Mr Vaz) Indeed.  The point is that our Government and our criminal
  intelligence organisations will work with our European partners.  That was the
  whole purpose of Tampere, to get jurisdictions to work together, to make sure
  that there was an international approach to catching criminals.  What we do
  not subscribe to and do not sign up to is one criminal code.
  
                              Mr Rowlands
        67.      Commissioner Barnier also told us in the meeting we had with him
  on 3 February:  "In an EU of 30, it would be necessary to allow a small group
  to move ahead without blocking the work of the EU.  Without reinforced co-
  operation members would move ahead outside the EU."  This is flexibility.  I
  am sure that used to be called variable geometry.  How do you view the concept
  of flexibility?  Do you think it is much of a runner or a starter or is it
  going to be developed at the IGC?
        (Mr Vaz) We are concerned - and obviously this matter has been raised
  before - to ensure that we have one Europe with states that are equally
  valued.  Those who support the idea of enhanced co-operation or flexibility,
  whatever you wish to describe it as, look about Europe as being an area where
  certain countries can move forward together on certain issues and that means
  by necessity others do not.  We think that those who support this move should
  make a case for it.  We believe, as it is currently described, that you will
  have a situation where you will have a two-tier Europe and that is not in the
  interests of the Member countries that are there and certainly not in the
  interests of the applicants, all of whom have said to me - I do not know what
  they have said to others but have said to me - they want to belong to a Europe
  where all countries act together and move forward in the same direction.  That
  is why we have, for example, Qualified Majority Voting in certain areas.  For
  those who support flexibility it is a very important point.  It is being
  raised, and it was raised with me last week when I met all the European
  Ministers from various countries.  I think the case must be put by those who
  want to put it on the agenda.
        68.      Those who are in flavour of flexibility, have they identified the
  areas in which they envisage this process occurring?  There are going to be
  examples. Schengen was a classic example where a group of nations within the
  European Union decided they wanted to establish borders and we all thought
  that was a good way to proceed.  Are there other areas where you feel this
  pressure for some kind of flexibility is going to go on?
        (Mr Vaz) Not specifically but the concept, as you have correctly
  identified, is one that some countries are keen to see discussed. 
        69.      They must have some idea what they want to do specifically in the
  areas covered by flexibility.  Has anybody identified them?
        (Mr Vaz) I do not think so. We have had some discussions with the
  countries who favour looking again at the Amsterdam provisions on flexibility. 
  I think it is possibly more of a psychological mechanism for them.
        70.      Psychological?
        (Mr Vaz) Psychological mechanism, it is a sort of insurance, if you
  like, that if in a much enlarged community there are a certain number of
  Member States who wish to go ahead with reinforced co-operation in a certain
  area, that they should not be blocked from doing so within the framework of
  the Treaty. So without being very specific about what those areas might be,
  they feel it would be a useful insurance, as I say, to have mechanisms in the
  Treaty that do allow that to happen.
  
                               Chairman
        71.      There are no specific areas in prospect?
        (Mr Vaz) Without any specific areas in prospect, there are no specific
  areas which have been specifically mentioned in the discussion in the IGC.
  
                              Mr Rowlands
        72.      In some ways one can see the sense of it, the sense that once you
  go into a group of 30 countries, there are going to be areas, the one that
  came up is Schengen and this idea of the removal of border controls.  Surely
  there are going to be groups within the 30 who will feel they can proceed in
  a much greater degree of co-operation and in a quite sensible, logical
  process.  Are we saying we do not mind that so long as it is outside the
  institutions of the Treaty?
        (Mr Vaz) What we are saying is we must look at what those who support
  these measures believe to be the areas.  As yet, as Mr Lyall Grant has said,
  nobody has come up with a specific proposal.  We are relaxed about this but
  we are cautious also about the fact that for the applicants, and indeed for
  the countries that are in the EU, we are very keen that there should not be
  a two tier Europe. It destroys the whole philosophy behind what we want to
  achieve.
        73.      One other area that should concern us, if it is done within the
  terms of the institution, is the whole morass on the budgetary issue, whether
  one would be able to use the European Union budget money for some of these
  flexible arrangements if they are still inside the European Union?
        (Mr Vaz) The case has not been made out for that as yet. None of the
  countries that have stated that they are in favour of this has made the case
  that it should extend to budgetary considerations.
        74.      Frankly with a Union of 30 do you not think it will come up in
  one form or another? Is it not a realistic approach to life?
        (Mr Vaz) You are right, Mr Rowlands. You are right to keep reminding
  us that this could be a Union of 30. I think the challenge, therefore, is to
  make sure that the institutions are ready.  This is a concept which has been
  raised.  We are relaxed about it being raised but we think those who have
  raised it ought to make up the case, they have not done so as yet.
  
                               Chairman
        75.      You do not reject it in principle?
        (Mr Vaz) No.
        (Mr Lyall Grant)           Could I just add, Chairman, on that, the key thing to
  remember is that there are flexibility provisions in the Treaty already agreed
  at Amsterdam.
  
                              Mr Rowlands
        76.      Outside.
        (Mr Lyall Grant)           No, no they are within the Treaty. They were
  introduced into the Treaty for the first time at Amsterdam. The flexibility
  provisions are there.  What some Member States are talking about in the IGC
  is relaxing some of the conditions that are set in those provisions in the
  Treaty.
        77.      They have to be agreed?
        (Mr Lyall Grant)           They have to be agreed by all Member States.
        78.      There has to be agreement by everyone in a flexible manner?
        (Mr Lyall Grant)           That is right. One of the proposals that is being
  discussed is whether what is called the emergency brake, which in essence does
  give all Member States a veto on use of the flexibility provisions, should in
  fact be removed.
  
                            Sir David Madel
        79.      You said a bit earlier that what has caused this IGC is the
  enlargement. So if the countries were not applying to join we would not be
  involved in an IGC.  That is what has caused these discussions and the extra
  Treaty. Often an IGC leads to "ever closer European Union" but do the
  Government think from the British Government point of view we are virtually
  at the limits of an "ever closer European Union" as far as we are concerned?
        (Mr Vaz) This Government is pro Europe.
        80.      That can mean a lot.
        (Mr Vaz) Right. It is pro reform, also. We believe very firmly that in
  pursuing our European agenda, at the heart of our European agenda is obviously
  working with countries within the European Union but also defending Britain's
  national interest. When you say we would not have an IGC if there had not been
  a move for enlargement, which is repeating my words, I say yes but I say,
  also, that the need for reform is always ever present in our minds.  Reform
  does not mean integration and closer co-operation.  Reform means looking at
  the way in which the EU does its work and making sure it is done more
  efficiently and more effectively and that it is related better to the people
  of the United Kingdom.  This has not happened and therefore as part of the IGC
  agenda one must look at the parallel activities that are going on, the Charter
  of Rights that is being discussed and at the same time the reforms being put
  forward by Mr Prodi and Mr Kinnock.  At the end of the day can we get ever
  closer?  We want to get closer to our European colleagues because we believe
  that the Single Market has been a tremendous success.  Being close to them
  means Britain's agenda is respected and followed as in Lisbon which was an
  astonishingly successful conference as far as we were concerned, the whole
  economic agenda being transformed by 15 countries determined to see a new
  economic model.  All these are ways in which not just Britain has benefited
  by change but also the rest of Europe benefits.
        81.      We will have to keep active to keep the show on the road.
        (Mr Vaz) Absolutely. 
        82.      Some people say the European Union is like a bicycle; if you stop
  peddling it will all fall down.  I take the gist of your views.  Can I just
  ask about timing.  Whatever agreement is reached at the summit in Nice there
  will have to be legislation in this House.  The Government would not want to
  be accused of being hesitant so I assume in January 2001 the Government would
  move straight to legislation on what had been agreed at the Nice summit.
        (Mr Vaz) At the risk of being corrected by Mr Mackinay on these
  procedural matters, we will want to make sure that we proceed as quickly as
  possible.  I do not have control of the legislative programme so I cannot tell
  you now, Sir David, that legislation is going to be before the House in
  January.  I do not think anybody knows but I can tell you this: we have taken
  the lead on enlargement.  The Prime Minister has been behind the enlargement. 
  He has been the prime mover in Europe.  We will move as quickly and as swiftly
  as we possibly can to make sure that we do our bit, conscious that there are
  countries outside waiting for this process to be completed before they can
  join. 
        83.      The Government has to move quite quickly or some people might
  say, "There goes Britain again being half-hearted", and the Government would
  not want that.
        (Mr Vaz) I am sure that we will move as swiftly as we possibly can. 
  No one can say that we are half hearted on enlargement.
        84.      You have not got the problems that other parliaments have because
  this Parliament has still got two and a quarter years to run.
        (Mr Vaz) If we have got as much as time as that, Sir David ---
        Sir David Madel:           In theory.
  
                              Dr Starkey
        85.      You mentioned a European Charter of Fundamental Rights.  You are
  on record in a written answer as saying we, I take it the Government, do not
  therefore favour the Charter's incorporation into treaties.  What do you see
  as the purpose of the Charter of Fundamental Rights?
        (Mr Vaz) I thought you were going raise this question, Dr Starkey. 
  The Charter of Fundamental Rights is a very important opportunity for the
  European Union to set out clearly the rights and responsibilities of its
  citizens.  As you know, the Charter of Rights process is a parallel process. 
  It is formed in a sense outside the structures of the European Union.  The
  Prime Minister and indeed Parliament has a representative through Mr Win
  Griffiths and Lord Bowness is also represented on the Charter drafting
  committee.  At the end of the day we will have in one document a clear and
  concise list of the rights that we enjoy as European Union citizens.
        86.      Can you explain how that relates to the European Convention on
  Human Rights? 
        (Mr Vaz) It does relate to it and there will be an overlap because the
  European Convention does confer rights.  As you know, the European Union is
  not a signatory to the European Convention but individual countries are, so
  there will be an overlap.  They should be seen in a sense together.  What the
  Charter will not be doing is to be giving out new rights to people, rights
  that they do not have at the moment.  I think we have a pretty sufficient list
  of rights already without the need to add anything more.
        87.      Can I just clarify, does the Charter of Fundamental Rights
  contain any rights that European citizens are not already guaranteed through
  their individual states signing up to the European Convention on Human Rights?
        (Mr Vaz) Yes, it will have some rights that are not in the European
  Convention.
        88.      Such as what?
        (Mr Vaz) I cannot tell you now this minute the list of those rights
  they do have there but I can tell you what it will do is to codify the rights
  that exist already.  They will not be trying in any way to impose new rights.
  It is a showcase of rights for the people of Europe and it will give people
  the opportunity to look at this declaration.  I think what Lord Goldsmith, the
  Prime Minister's representative, has suggested is a document which sets out
  clearly what your rights are, a two-part document in a sense, and the second
  part talks about the sources of those rights.  That is why it is important to
  do that.
        89.      This Government effectively incorporated the European Convention
  on Human Rights into our law so that individual citizens could seek redress
  within our own courts.  Are there proposals to do the same with the Charter
  of Fundamental Rights if it contains additional rights that are not within the
  European Convention?  If there are no such proposals, how are individual
  citizens who believe their rights under the Charter of Fundamental Rights have
  been abused to seek redress?
        (Mr Vaz) In the way that they do now.  It is not a new piece of
  legislation that will give people new rights.  If you have a right that is not
  conferred by ECHR but conferred in some other way as a citizen of the European
  Union, you will be able to use your redress.
  
                               Chairman
        90.      In what way will you be able to seek redress if you cannot do so
  through the European Convention or through our own courts?
        (Mr Vaz) Chairman, far be it for me to say this in the presence of
  such a distinguished lawyer, but the fact is that if you have already these
  existing rights what we are not suggesting is that you should have a new court
  or new method by which they should be enforced.
  
                             Mr Mackinlay
        91.      If you check the record tomorrow you will find that you said
  there could be some rights over and above the European Convention.  That is
  what you said.
        (Mr Vaz) Over and above what people already have, not over and above
  what the Charter drafting committee are going to give people.  There are no
  new rights contained in the Charter of Rights.  It is a declaration of
  existing rights and one should not get carried away with thinking somehow this
  is a new set of rights to be enforceable.  If you check the record that is
  exactly what I said.  If the only rights contained in the Charter were
  existing rights contained in the European Convention on Human Rights there
  would be no point in having it.
        92.      Presumably you or the Government would envisage, if this comes
  about, this being something which lawyers could advance in their arguments in
  advancing a case or appeal where there has been a remedy sought in relation
  to rights denied under the European Convention?
        (Mr Vaz) No, with respect to the Chairman and others, we are not
  intending to produce a Charter of Rights in order to assist lawyers in
  amassing more fees.  We are producing here a declaration of existing rights,
  not new rights.
        93.      I do not mean this facetiously but apart from it being a nice
  poster with doves on it, which no doubt will get to Storey Gate somehow or
  another, what purpose will it serve if it is not appealable?  Let us be blunt
  about this.  Is it the British Government going along with this because they
  want to resist it for wider reasons perhaps, but their intention is that it
  is not going to amount to a ha'penny worth of beans, is it? 
        (Mr Vaz) Mr Mackinlay, with the greatest respect, that is your
  interpretation of it.  The interpretation of the Council of Ministers was that
  it was important that we should have a document that contained the body of
  rights that people have.  Whether the poster has doves on it is, I think, a
  little premature because we are still within the process of discussing the
  format of the way in which the Charter is to be worked on.  What the Charter
  will not do, I can assure the Committee, is confer any new rights that do not
  exist and that is why a declaration is important.  People often accuse the
  European Union of not being able to communicate effectively with its citizens. 
  I believe this is an important way we can remind citizens of what they get
  from being members of the European Union.
        94.      So it is like when you and I were candidates, we signed the
  European Social Chapter poster which we got from Storey Gate, that one?
        (Mr Vaz) I cannot remember that far back, Mr Mackinlay.  It is such a
  long time ago.
        95.      I have to say I remember when I knew Ministers who were Members
  of the Common Market Safeguards Campaign but that was a long time ago.
        (Mr Vaz) I think I have a bit of amnesia.
        96.      I understand that.  Just a small point, if I may, you said that
  Win Griffiths and another colleague represent this Parliament.  Who appointed
  them?
        (Mr Vaz) By Parliaments, by the Speakers, by the Lord Chancellor and
  by the Speaker of the House of Commons.
        Chairman:   Now, Dr Starkey is continuing a line of questioning and then
  Mr Wilshire on the same point.
  
                              Dr Starkey
        97.      To follow up on that, do they report back or consult in any way?
        (Mr Vaz) Indeed they do report back. Only a fortnight ago I held a
  meeting which enabled Members of Parliament to come and talk to the
  representatives. Lord Goldsmith and I will be giving evidence to the Select
  Committee next week, the Scrutiny Committee, and there have been debates in
  Parliament on this. In fact, I encourage people to write to the Prime
  Minister's personal representative and to the representative of the House. 
  They need to seek opportunities to be able to report back to Parliament on
  these matters. Certainly, we will report back as Ministers once the decisions
  have been taken.
        98.      Finally, to close this line of questioning which I have been
  pursuing, your view is effectively that this European Charter of Fundamental
  Rights tabulates, it codifies the rights that are already pre-existing, some
  of which are also covered by the European Convention on Human Rights but they
  are conditional rights. Is that simply your view or is that the view of all
  the Member States within the European Union?
        (Mr Vaz) It is the view of the Member States as expressed to me.
  Obviously there is a drafting committee which is going on and the drafting
  committee will look at ways in which the views of the Council, which
  established the idea of the Charter, are put into practice.  There is no huge
  appetite, I do not think, about conferring new rights on people.  I think
  there is an understanding of what we want to achieve.
  
                              Mr Wilshire
        99.      There are two things I want to get absolutely clear in my mind
  about this. I have been listening very carefully and the score is currently
  3-all in what I have noted. The score is 3-all to saying "no, there will be
  no new rights" which I think I heard the Minister say three times, and it will
  appear in the record tomorrow, but I have heard him now also say or agree
  three times "yes it will result in us having rights that we do not currently
  have".
        (Mr Vaz) No.
        Mr Wilshire:   The record will either say that or it will not.  I wrote
  down two comments that the Minister made very early on. He said "no new
  rights" and then he said "yes there will be rights for EU citizens that they
  do not have at the moment".  The record will bear that out.
        Dr Starkey: That they do not have at the moment.
  
                              Mr Wilshire
        100.     Could we be told, Minister, whether it is no rights that we
  do not have at the moment or there will be rights we do not have at the
  moment, which is it?
        (Mr Vaz) There are no new rights that we do not have at the moment, Mr
  Wilshire. Your problem is that you left the room and, therefore, you did not
  hear the discussion. The discussion was quite clear and I made it quite clear
  that there are no new rights. This Charter body is not in a position to confer
  new rights on European citizens.
        101.     The rights I have at the moment, as an EU citizen, are
  contained in the Convention on Human Rights?
        (Mr Vaz) No.
        Chairman:   No, that will be within domestic law.
  
                              Mr Wilshire
        102.     Within domestic law. So there will be no addition to that?
        (Mr Vaz) No. There are going to be no new rights conferred by the
  Charter of Rights. You came into the room in the middle of my conversation
  with Dr Starkey when she said "if it is just the European Convention of Human
  Rights why do you not just have that or are there going to be additional
  rights to that".  Of course, as European citizens we enjoy additional rights
  to those contained in the European Convention of Human Rights.  If it was just
  the European Convention of Human Rights there would be no point in having a
  Charter of Fundamental Rights.
        103.     That was the first point. The Minister has made a point which
  occurred to me long since, this is a silly waste of time. The other thing that
  the Minister said is that we will pursue our rights as we do now.  So does the
  Government support putting this Charter into the Treaty?
        (Mr Vaz) No.
        104.     If we are to pursue the rights given to us in this Charter,
  how are we to do it?
        (Mr Vaz) In the way that they are pursued at the moment.
        105.     How is that?
        (Mr Vaz) Which one are you referring to?
        106.     Anything in the Charter. If we wish to complain about a
  breach of our rights given by the Charter, how will we do it?
        (Mr Vaz) They are not given, Mr Wilshire, can I explain again, the
  Charter will not give you rights.  It was very eloquently put by Dr Starkey,
  if I may say so, and I shall study her words and use them myself.  The Charter
  will declare, it will codify existing rights.
  
                              Dr Starkey
        107.     I think they were your words.
        (Mr Vaz) Therefore you will pursue those existing rights.  There is no
  need to get worked up about this, Mr Wilshire.  They are not new rights.
  
                              Mr Wilshire
        108.     How will we pursue them?
        (Mr Vaz) In the way in which they at the moment pursue these rights.
        109.     Which is how?
        (Mr Vaz) It depends on the right, it depends on the right that you are
  discussing and which one you want to talk about.
        110.     Will any of these rights be justiciable before the European
  Court of Justice?
        (Mr Vaz) If they are at the moment they will be.  We will not be
  giving a new set of justiciable rights to people. If they are pursued in that
  way today, they will be pursued in that way on 31 December when the Charter
  is complete. We are not going to have any new tiers of law, any new methods
  of enforcement, any new ways in which people can prosecute. It is a
  declaration, a codification, a simplification, a communication of existing
  rights.
        111.     On the 24 January, Minister, you said to the European Select
  Committee that the French would not support taking these matters before the
  European Court of Justice.  Yet we now have the French saying, along with the
  Germans and the Commission, that they want them to be taken before the
  European Court of Justice. Do you wish to change your view that the French
  will not support it now that they have said they will?
        (Mr Vaz) No, I cannot change a view that I gave in January. If that is
  what the French told me on January 24, I have faith in the report of their
  views to the Committee. If they have changed their views then it is a matter
  for the French and the Germans and we will report back in the way in which it
  is appropriate if their views have changed. I am not going to change something
  that I have said. That is the position as it was on 24 January.
        Chairman:   I think we need to move on. Mr Mackinlay.
  
                             Mr Mackinlay
        112.     Indeed, I would like to move on.  I just want to say that
  often I get misunderstood here, I actually think it is perhaps a pity this is
  not a justiciable thing.  In case of guilt by association, anybody should
  think otherwise, I want to make that quite clear and no doubt it will be noted
  at Storey Gate. The thing I want to ask you is, probably Mr Lyall Grant can
  help us on this, the way I understand it now is in recent months the agenda
  for European Ministerial Councils is now on the internet prior to the meeting
  - I think that is so - I wonder if you can confirm that?  Secondly, will the
  agenda items for the meetings which you attend in advance of the IGC and all
  the consequential meetings be available also now on the internet?
        (Mr Vaz) I am afraid I do not know.  Mr Lyall Grant?
        (Mr Lyall Grant)           Yes, I can help you with that a little bit Mr
  Mackinlay. At the moment it is left largely to the discretion of the
  Presidency how much of the agenda they publish and put on the internet or
  publish in any other way. There is some discussion going on at working group
  level, which will come up to the Council for decision, to codify that and make
  much more transparent the agendas of all the Council meetings and working
  bodies.  As far as the IGC discussions are concerned, the Presidency is
  bringing forward a number of working papers which are being discussed in the
  preparatory group and they do have the intention of posting all of those on
  the internet more or less as they happen and, therefore, they should be
  available, but to make sure that the committees do have those documents Mr Vaz
  has agreed, I think, with the chairman of the three committees that he will
  on a monthly basis send all the Presidency papers over to the committees
  anyway. What I cannot confirm is whether the Portuguese Presidency have done,
  in fact what they intended to do which is to put all these papers on the
  internet immediately.
        113.     Okay. I am very grateful for Mr Vaz's offer to the chairmen
  of committees, I mean that sincerely. It does seem to me there is an important
  point between this negotiating period and, if I might say, a general point as
  from here onwards. We do find that there is a disparity of treatment between
  our Parliament and many other Parliaments with their ministers. Their
  ministers under the rules have to come to them before hand and say "This is
  what we are going to discuss, X, Y and Z" actually before the event. I would
  have thought that now is the time to deal with this. Would it be possible, in
  response to what you said to clarify the position as to what the Portuguese
  Presidency intend to do, where we can find it and the moment of availability?
  If they are technically in the public domain could they not be demonstrably
  put in the public domain and Minister perhaps you would let us have them in
  the Vote Office or via our Clerks at the point when they are available in
  Stockholm, Paris, Brussels or wherever? Do you see the point I am making?
        (Mr Vaz) I do, Mr Mackinlay.
        114.     We are entitled as Parliamentarians to be at the starting
  grid along with our cousins in the other parliaments.  There is no criticism
  at all, it has drifted and it is half and half it seems as regards what is
  available. Could we make this great constitutional advance this afternoon
  saying that we will be able to have access when others do and that you will
  help us do it by telling us the position and/or making them available?
        (Mr Vaz) Mr Chairman, I think Mr Mackinlay makes a very, very
  important point and if there is any way in which the Government can help make
  the documents more accessible. We certainly do not want to be in a worse
  position than other Parliaments.  If they are putting out the agendas on their
  internets and websites and they are generally available, I will look to see
  how we can improve that.
        Chairman:   I do understand that we as a Committee receive the list
  monthly and that list is circulated by the Clerk.
  
                             Mr Mackinlay
        115.     I gave him full praise for that.  I gave him a star for that. 
  But that is all retrospective and we want it at the same time others get it. 
  Journalists could get it but we want it facilitated.
        (Mr Vaz) Mr Chairman, a star from Mr Mackinlay is always welcome but
  I will make sure that I try and get two stars from him and accede to his
  request.
        Chairman:   Dr Godman, who has been very patient.
  
                               Dr Godman
        116.     This has been a very interesting exchange of views this
  afternoon.  I am sorry I missed seven minutes.  You have been pretty positive. 
  You have said, for example, that HMG has taken the lead on enlargement and
  that HMG is anxious to avoid a two-tier European Union.  I think that is going
  to be near impossible myself but, given your optimism, have any of your
  colleagues from other Member States of the European Union voiced doubts about
  the possibility of failure to adhere to the timetable for enlargement?
        (Mr Vaz) Dr Godman, I know you have a particular interest in
  enlargement and you are right to keep raising the aspirations of applicants. 
  It will be a different Europe when countries do actually come in.  There is
  always a worry amongst the applicants, some of whom are watching this evidence
  session, that the timetable is slipping.  We want to make sure that they are
  able to conduct their negotiations as efficiently and as quickly as possible
  and I have made it clear to all those who have visited me that if the United
  Kingdom can help in any way we want to help.  They have their own timetables
  as to when they want to see themselves as part of the European Union.  Some
  may be a little ambitious; others may be spot on.  But it is difficult to come
  to a conclusion until they are in a position to complete their negotiations
  on the very important chapters you have mentioned such as agriculture.  The
  first six have been completed even though they are no longer called the first
  six and second six.  The last time that we were aware, we have opened 23 of
  the 31 chapters of the acquis.  That is good progress.  The Portuguese hope
  to open up the last eight during their Presidency.  There is really good
  progress being made.  But I think that we must also be conscious that public
  opinion in those countries may wane if there is any feeling that we are not
  doing our best to support them.  That is why the United Kingdom feels so
  strongly about getting the IGC over with in 2000 and getting it finished
  quickly and putting it through various Parliaments.
        117.     Can I just say I have no wish to dishearten the people of
  Poland and other applicant states, but I find it difficult to imagine, for
  example, a coalition government in Dublin or other governments elsewhere in
  the European Union agreeing to radical reform of the Common Agricultural
  Policy in order to meet the legitimate expectations of those people employed
  in the Polish agricultural industry.  Let me come to another industry that
  rarely gets a mention in these things.  Will you confirm, and if you cannot
  today I am sure you will try your best to do so by way of a letter to the
  Chairman, that there are no similar problems to those bedeviling the CAP with
  regard to the Common Fisheries Policy, that we will never see vessels from the
  large Polish fleet fishing in the North Sea and Irish Sea?  Am I right in
  assuming that as part of the negotiations those nations with fishing fleets -
  and I think Poland is one of very few amongst the applicant states that has
  the capability to fish in our waters, dare I say it, or European Union waters
  - they have been told that they will not be equal members in relation to the
  Common Fisheries Policy? 
        (Mr Vaz) On your first point, I think that there is concern over
  certain areas.  What we need to do, though, is identify any problems that
  exist to try and help the applicants as much as we can.  Timetables are
  incredibly difficult to set but we must do our best to try and help them
  achieve that.  On the fisheries policy I will write to you with all the
  details that you have requested.
        118.     I would also like to know because I think it is in the
  interests of the Polish people in particular and their maritime industries,
  indeed I represent a maritime community, maybe Mr Lyall Grant can answer this
  question, what assistance, what advice has been given to the Polish government
  in respect to what the European Union people in Brussels call the
  "restructuring" of their fleet, in other words the diminution of their fleet? 
  Have they been given assistance?  You will have to write to me. 
        (Mr Vaz) We will write to you with all that detail.
  
                               Chairman
        119.     Before turning to Sir John Stanley can I pursue this point of
  Dr Godman's on agriculture.  We know that the budget of the European Union has
  been set until 2006.  Clearly if Poland were to join in 2003-2004 it would not
  be able to benefit from aids on the agricultural side without mightily
  altering that budget, so is there a real danger that because Poland might be
  held up and not being able to benefit in any way from the budget that that
  could stall the whole process of enlargement? 
        (Mr Vaz) No, I do not think so, Mr Chairman.  The negotiations are on-
  going.  The agricultural chapter when it is opened will address these issues. 
  In the discussions I have had with the Commissioner he is keen to help all the
  applicant countries in the best way he can.
        120.     He may be keen but is there money?
        (Mr Vaz) That is a matter for the negotiations.  Certainly as far as
  we are concerned, those negotiations when they are completed will not be
  allowed to in any way derail the process.  Polish agriculture will not derail
  the enlargement process.
  
                               Dr Godman
        121.     But the farming lobby is just about the most powerful
  political pressure group within the European Union. 
        (Mr Vaz) Indeed it is, and that is why it is extremely important that
  the negotiations that take place when the agriculture chapter is opened are
  done so in a robust but also an effective way.  You are right, these are very
  very important matters that need to be dealt with.
        Chairman:   Sir John is about to open a new chapter and then we will go
  on to defence and security. 
  
                           Sir John Stanley
        122.     That is the chapter I am about to open.  Are you happy for me
  to proceed on that?  Minister, as you know, the Commission has proposed that
  in this IGC there should be established closer co-operation in the field of
  common foreign and security policy.  Do you envisage there being Treaty
  changes - and I stress Treaty changes - to bring about closer co-operation
  common foreign and security policy?
        (Mr Vaz) Sir John, we will make that decision at Faro.  Certainly the
  point you have raised is one that has already been raised and we are looking
  at this.  When we come to the final Portuguese Council meeting we will make
  that decision by then.  That is one of the points that has been raised. There
  may well need to be and we will look at it then.
        123.     Are you saying that as far as the British Government is
  concerned it is reserving its position or is it sympathetic to Treaty changes?
        (Mr Vaz) I think we will look at the position then.
        124.     Can I ask you in one specific area what is the British
  Government's position on creating a competence in the EU Treaty legal sense,
  for the EU in the defence and security field?
        (Mr Lyall Grant)           Our lawyers are looking at the question of whether the
  sort of arrangements that we are setting up under the common defence system
  will require Treaty amendment.  Areas where we think the Treaty amendment may
  be required are precisely in the areas to give the committees that will be set
  up, particularly the Political and Security Committee, the authority to take
  operational decisions in times of crisis. At the moment that committee does
  not have that authority and any committee set up under these new structures,
  without Treaty amendment, would not have that authority. That is one area
  where our lawyers advise that some Treaty amendment may be required. 
  Likewise, if that committee is to be expanded in some way to include some non
  members of the EU, because under defence there will be flexibility
  arrangements whereby there may be less than the 15 who want to join in some
  form of defence operation, and there may be more than the 15 who want to join
  in, so you will have some form of ad hoc committee.  Now, to create that ad
  hoc committee again might require Treaty amendment. If it is necessary to make
  agreements between that committee, between the EU and a third country, again
  some amendments to the Treaty may be required.  In all those areas our lawyers
  are looking at whether the defence amendments will be required.  As the
  Minister was saying that decision is likely to be taken in Faro in June.
        125.     Thank you. That is very helpful.  These are not just simply
  issues of drafting and legality, what lies behind my questions, Minister, and
  I am sure you understand, is the issue of whether or not the EU is going to
  be given a competence, and I am using that in the EU sense, a competence in
  the defence and security area.  I turn to your civil servants, I assume
  Ministers must have a view as to whether or not it is desirable that the EU
  should have a competence in this area, competence carrying with it the
  application of EU law and competence carrying with it the right of initiative
  by the European Commission?
        (Mr Vaz) On the whole in the discussions that we have been having on
  Defence and Security Policy - and this is a new area for us, that is why we
  are not trying to fudge the issue by saying we have not decided whether or not
  there is going to be Treaty change - we are looking at the advice that we have
  received and we will make the decision at Faro.  What we do not want to do is
  be in a position where any of the agreements and the relationships that we
  have at the moment, such as the ones we have with NATO, are in any way
  affected by any particular initiative that the European Union might take. I
  think these are issues that in the end have got to go to the Council for
  decisions to be made.  I think the defence debate has moved much more swiftly
  than one could possibly have imagined a year ago.  I think this is a good
  thing. We are always conscious though that in taking any initiative that we
  need to keep on board our NATO allies because NATO remains the bedrock of our
  whole defence policy and, also, those non EU countries that happen to be
  members of NATO. Therefore the legality, the whole question of initiative,
  needs to be looked at very carefully indeed. My view is that we need to assess
  the relationships that we have with the other organisations that we deal with
  and come to the decision as to whether or not we need to make that entrenched
  in the Treaty.
        (Mr Lyall Grant)           Perhaps I can just add by way of clarification that
  the European Union as such already has competence in these defence issues; the
  European Community does not and that is a very important distinction.
  Everything that we do in the defence field, as it is in the Common Foreign and
  Security Policy field, is inter-governmental.  You referred to the
  Commission's right of initiative, in fact there will be no right of initiative
  for the Commission in defence because it is inter-governmental activity.
        126.     I am delighted that Mr Lyall Grant has given the answer that
  I would have expected the Minister to give himself because that is the key
  issue and there are certainly some within the EU institutions who are looking
  to have competence extended to the Commission in this particular area.  I
  would hope, Minister, you would rule out emphatically the British Government
  ever agreeing to a competence being established in the defence and security
  area for the European Commission?
        (Mr Vaz) Sir John, I made it clear to you in my answer that this is a
  matter for the Council to decide upon and that remains our position.  The
  Council, as you know, is not the Commission.
  
                              Mr Wilshire
        127.     Minister, do you support merging the WEU and the EU?
        (Mr Vaz) I believe that we should look to areas in which the WEU and
  the EU should work together. The WEU still exists.  Mr Solana has played a
  very important role in ensuring that the work that is done by the WEU is
  carried on by the EU. I think that the whole defence and security area has
  succeeded because we have in the personality of Mr Solana somebody who knows
  the organisations extremely well. When you say merger, I think that in time
  one will find that the work of the WEU is one that can properly be conducted
  by the States within the European Union working with their partners outside.
        128.     You said that the EU would carry on.  Do I take it that it is
  Government policy to encourage the EU to take over where the WEU has left?
        (Mr Vaz) No, it is Government policy to encourage the kind of close
  working relationship that exists between the organisations.
        129.     Also, you said in the previous reply the EU working with the
  WEU and the non members within the WEU who are not members of the EU.  How
  will they work together? For example, how will Norway participate in decision
  taking of the EU's defence initiative?
        (Mr Vaz) Because when we have WEU meetings I attend as the Foreign
  Affairs Minister, the Secretary of State for Defence attends and, therefore,
  we are able, through the personalities of ministers attending these various
  meetings, to ensure that countries like Norway are included in the decision
  making processes.  
        130.     The Norwegians would be invited to those EU meetings?
        (Mr Vaz) No, we participate as Foreign Affairs Ministers at meetings
  of the WEU. For example, if we have a situation, as we have had when Defence
  and Security Policy became an issue that the European Union was concerned
  about, we would invite countries who are not members of the EU to be involved
  in discussions that are taking place. We have done this already on three
  occasions.
        131.     Would you allow them to have a vote if the matter was put to
  the vote?
        (Mr Vaz) The matter has never been put to the vote.
        132.     If the EU develops this initiative, presumably it will want
  to use WEU facilities and WEU know-how?
        (Mr Vaz) I think that the way in which we wish to proceed is on the
  understanding that we want to work with the WEU, because we are part of it.
  We want these two organisations to work side by side and that is the way in
  which we have approached the whole Defence and Security Policy issue.
        133.     As you will be aware, the WEU currently has a parliamentary
  oversight to it through its Assembly, what would be the parliamentary
  oversight of the EU's defence initiative and defence capability?
        (Mr Vaz) Exactly the same parliamentary oversight that we have at the
  moment.
        134.     There would be no role for the WEU Assembly in the oversight
  of the EU's activities?
        (Mr Vaz) No.
        135.     Thank you. What will be NATO's input to this European Union
  defence initiative?
        (Mr Vaz) NATO's input is absolutely crucial. NATO is the bedrock of
  our defence policy. We work extremely closely as the European Union with NATO, 
  of course, because we believe that the way in which we wish to approach
  defence issues is with the co-operation of our NATO partners and that means
  those NATO partners that are not members of the European Union.  Practically,
  it means if we have a discussion on Defence and Security Policy within the
  European Union, we have so far, when these matters have been discussed,
  immediately had a meeting with those non EU NATO members so everybody is kept
  informed of the way in which we wish to develop that policy.  There is no
  threat to NATO from the European Union developing a Common Defence and
  Security Policy. NATO is enhanced by this. 
        136.     So NATO will be involved in the European initiative? 
        (Mr Vaz) Of course it will be through its members.
        137.     So how will arrangements be made therefore for non-EU members
  who are members of NATO to participate in the decision-taking process?
        (Mr Vaz) We are working on structures at this moment.  I think that
  one should not expect these matters to proceed at an enormous pace.  I have
  been astonished at the pace of change since the initiative was announced a few
  years ago, but the issue is how do you practically ensure that our partners
  in NATO feel that they are part of that process because they are clearly part
  of that process.  We would not in the European Union do anything that was
  against the instincts and the policies of NATO.
        138.     When working with NATO on defence initiatives and taking
  decisions, there will be some members of the European Union who are members
  of NATO as well and therefore they will have a close relationship with the
  remainder of NATO countries that are not within the EU, but there are some
  members of the European Union that are not members of NATO.  Will those EU
  members have an equal status when taking decisions involving NATO? 
        (Mr Vaz) It happens practically at this moment.  After EU Ministers
  consider defence or foreign policy security issues and the only occasion it
  has happened was when the initiative was launched, there was a separate
  meeting immediately after which involved those from the non-EU countries.  Our
  mission is not in any way to undermine NATO.  Our mission in this is to
  support NATO.  The defence and security policy is based on the philosophy that
  the European Union needs to be able to deal with the crisis management tasks
  that it has not so far been able to deal with and the countries themselves
  need to have the competence in order to deal these issues and the capability
  in order to deal with them.
        139.     Yes, I take that point.  If you look to Kosovo as an example
  of what has happened in the past (and if I understand these initiatives
  correctly hopefully it could be done differently on a European scale in the
  future) you will find that the high technology, the manpower, the firepower
  and the money were all American.  Is it the intention of the EU to replace
  American technology, American manpower, American firepower and American
  finance?  If so, where is it going to come from? 
        (Mr Vaz) No, it is not the intention to replace it.  It is the
  intention to work with the Americans who are our partners and allies in NATO. 
  If you look at the Petersburg tasks, Mr Wilshire, you will know that they set
  out in effect a limited set of goals - crisis management, peace-keeping,
  humanitarian issues.  This is not, as some would have it be, such as the
  Shadow Defence Secretary, an attempt to undermine NATO or the Americans.  This
  is something that Europe needs to be doing.  As the Prime Minister has said,
  this is Europe's backyard.  It is important that we have the capability of
  achieving what we wish to achieve.  Indeed, what happened in Kosovo is an
  example of why we should be working together so that we can produce the 
  ability of the European Union working with NATO to deal with those crucial
  tasks.
        140.     So if I understand you correctly, we are going to still use
  these American facilities, we are going to construct through this IGC a
  defence initiative which will take decisions, commit forces and then call on
  the Americans to pay for it, provide the manpower and provide the weapons for
  it. Is that what you are suggesting?
        (Mr Vaz) I think that is a rather sad summary of what I was
  suggesting.
        Mr Wilshire:   I think that is what I heard you say and the record will
  confirm it.
  
                               Chairman
        141.     We will move on.  Let me round up the subject of defence in
  this way.  There were two views, as you know, Minister, in relation to the
  chairmanship of the relevant committee, the political and security committee. 
  Some argue that there should be continuity in one person - perhaps Mr Solana
  should chair it for several sessions - and others say it should be according
  to the normal rotation.  Where do the British come in on this?
        (Mr Lyall Grant)           I am afraid this is not directly my area of
  responsibility and we shall write to you.
        Mr Wilshire:   An Exocet has been taken.
  
                              Dr Starkey
        142.     Can I just clarify that there may be some tasks that the
  Americans would not wish to be involved in.  It is precisely those
  circumstances the ESDIC envisage.
        (Mr Vaz) It is not a question, Dr Starkey, of the Americans not
  wishing to be involved.  The Americans are our allies in NATO, they work with
  us in order to ensure that defence and security policy works.  It is a
  question of the European Union countries being able to have the capability of
  dealing with these crises situations themselves.  This is not an exclusive
  issue.  We will work with NATO and through NATO.  This will improve NATO's
  ability to deal with these issues.  The fact is that a number of these
  countries, if they are not members of the European Union, are members of NATO. 
  These are all countries that are able to be in communication with each other,
  are able to work together in order to achieve these ends.  What we are putting
  in place now is the structures. This is early days, we are putting together
  the structures, we are ensuring that we know where these committees are to be
  housed and we are trying to work out a scheme which will ensure that nobody
  could be under any misapprehension that what we are trying to do is to work
  with our allies.  It is not something that Europe wants to do on its own, this
  is something that we will always do through NATO.
        143.     Of course we would not wish to do something which America did
  not support or did not think was a good idea but we might have the capability
  in some circumstances, clearly not something as large as Kosovo which required
  a particularly large force, we might be in a position where Europe could
  commit forces without necessarily calling upon American forces, even if the
  Americans were supporting the policy initiative?
        (Mr Vaz) The Prime Minister wants to do what colleagues on the
  European Council want to do, to make sure that we are able to fulfil the
  Petersberg tasks and that means individual Member States need to have the
  capability of putting together their forces, not a European army as some would
  envisage and some think we want but individual forces being deployed together
  in order to fulfil that aim.  That does not exclude the involvement of NATO
  and the Americans.
  
                            Sir David Madel
        144.     We are really anticipating this scenario that through
  America's democratic system, through congress, through the senate, through the
  President, that the Americans may well say in the future, as a crisis
  develops, "You handle that. You get on with it. Do not expect us to do
  everything.  That is one we, the Americans, think you can do" and we want to
  be able to say to the Americans "Yes, we can do it".
        (Mr Vaz) Sir David, there is no question of us wishing to go on in any
  direction that does not involve consultation with NATO and working with the
  Americans. This is a myth that has developed partly because the Shadow Defence
  Minister went to Washington and made statements which seemed to indicate that
  we were on a different path. I too have been to Washington and the feedback
  that I got from senior American officials on the Hill in the administration
  is that they welcome what the European Union has done but what they want to
  do is to keep in touch, to make sure that when decisions are made we make
  these decisions jointly. That is the position.  It may or may not include
  American forces being used.
        145.     I am not for a minute suggesting we would go off and do it
  without even consulting the Americans, I am just looking at it from the other
  side of the Atlantic, the Americans are going to say, are they not, "that
  crisis has arisen, you deal with that one"?
        (Mr Vaz) They may say that but the fact is when you are dealing with
  allies you need to work with your allies. As the Prime Minister has said, and
  the other leaders have said, we need to be able to look after our own back
  yard where necessary.  That does not mean excluding NATO, it means working
  with NATO.
  
                               Chairman
        146.     Minister, perhaps we were reassured by things like the Strobe
  Talbott speech last autumn who might have feared that we were disengaging
  decoupling.  We used the phrase that the United States has the first refusal.
  Is that a formula which is accepted by our other allies, including France, in
  respect of this project?
        (Mr Vaz) There are views from different Member States on the use of
  those precise terms. We though are in no doubt that when we do anything in
  Security and Defence Policy it is with the agreement of NATO and, therefore,
  our American allies being part of NATO are part of that process.
  
                           Sir John Stanley
        147.     I think I just would put this to you, Minister.  We, like
  you, have been in Washington.  We were in Washington last week and were you
  not told, as we were told on the Hill in the most unequivocal terms, that the
  basis of the Americans being prepared to go along with this new EU involvement
  in defence is the belief that this is going to be part of a significant
  increase in financial responsibility for defence being taken on by the
  European Union Member States and, indeed, we ran into some criticism on the
  Hill that the increased defence expenditure by the EU countries had not yet
  materialised.  Minister, you are surely not denying that that is the basis of
  American support for this particular initiative?  Would you not also agree
  that if that increased expenditure by the European Union countries does not
  materialise there is going to be a very significant degree of disillusionment
  in the American administration and in political circles in the United States?
        (Mr Vaz) Sir John, you know more than anyone else on this Committee
  being a former Defence Minister that there is one argument for saying do it
  all yourself and we would like to be able to do that and yet others would say
  where is the capability for achieving this?  Our call is that Europe develops
  the capability to deal with these situations.  I did not sense any view that
  the Americans wanted to detach themselves from what we were doing in the
  European Union.  They were watching what we were doing.  As you did when you
  went out there, I heard people say to me they were concerned to ensure that
  they were going to be fully included.  In the end you are absolutely right. 
  People will have to come up with the resources and the capability in order to
  meet the headline goal.  If they do not meet that headline goal then the
  philosophy behind the defence and security policy will not work.  I am
  confident that each one of the European countries understands the need for
  them to achieve those capabilities.  That is why it is really important that
  we should keep reiterating again and again and again, contrary to what some
  people have said that we are always going to do this working with NATO and
  working with our American allies.
        148.     So you are agreeing, from what you have just said, that what
  lies behind and flows inescapably from this policy is a significant increase
  in defence expenditure by the EU Member States to provide those very
  capabilities to which you have referred?
        (Mr Vaz) What is required is the ability to match the good words with
  the capability to achieve those goods words in crisis situations which have
  been set out by the Petersburg tasks.
        Chairman:   I am beginning to wrap up but Dr Godman, Dr Starkey and Mr
  Mackinlay have some final questions.
  
                               Dr Godman
        149.     If this question has been asked I am sure the Chairman in his
  courteous way will stop me dead in my tracks, Minister.  Paragraph 25 of the
  White Paper on page 21 talks about the next major task being institutional
  reform and the paragraph refers to the European Commission and Council of
  Ministers and European Parliament and European Court of Justice.  Could I ask
  a question concerning the European Court of Justice as one who has had some
  experience of this.  I was associated with a test case involving the payment
  of invalidity benefit to people over 60 and we went all the way to Luxembourg
  and we lost the case there but that is a different story.  The referral of
  cases to that Court in Luxembourg is a cumbersome procedure.  I cannot see how
  that can be improved in an enlarged Union.  When you talk about reform of the
  European Court of Justice, are you referring to its membership, its structure,
  its modus operandi or the penalties and sanctions it can impose against the
  Member States? 
        (Mr Vaz) I think we are thinking about quite a fundamental look at the
  way the ECJ operates.  Your experience, Dr Godman, is not unique.  It is
  established that it takes a great deal of time to get cases referred and then
  to get cases through the procedure.  I think the Lord Chancellor has also made
  his views known on this issue.  It is important that we reform the way in
  which cases are dealt with at first instance and on appeal and we look at the
  way in which appointments are made and we also look at rules of procedure. 
  That is why we are keen, and we have said this, to look at QMV as a means of
  making sure that the Court becomes much more efficient.  There is a tremendous
  amount of delay built into the system.  To quote an old clich‚, justice
  delayed is justice denied.  It is essential that we find a way of making the
  whole system work more efficiently.
        150.     In a sense it is a kind of supreme court over the 15 Member
  States.  Is there any thought being given to an appeal court being set up in
  a larger European Union?
        (Mr Vaz) We are looking at the way in which cases are managed. There
  is no idea before us at the moment about an overarching supreme court that
  will take away any of the jurisdiction that our courts have, but there is a
  good deal of work that has gone into the way in which first instance decisions
  and the appeal process work. I understand your point but as far as I am aware
  there is no move to try and make that a supra-national state.
  
                             Mr Mackinlay
        151.     You have had an opportunity, no doubt, to read our report on
  Gibraltar. If you have not, you should.
        (Mr Vaz) I am sure you will send me a copy.
        152.     What is a fact is at the IGC of 1997 there were things which
  were forgotten about, the consequences on Gibraltar, it is documented.  Who
  is to blame is arguable but that was a fact. What mechanisms are you building
  in to ensure that this time round the interests of Gibraltar are taken into
  account rather than it being discovered after treaties are agreed, which was
  what happened there, either by design or screw up that there is a problem? 
  What mechanisms are being put in to ensure you protect the interests of the
  people of Gibraltar this time round?
        (Mr Vaz) Mr Mackinlay, I know that you quite rightly are seen as a
  champion of Gibraltar and I can give you the answer that I gave in the House. 
  The situation of Gibraltar, as always, is uppermost in the minds of the United
  Kingdom in these matters and we will continue to ensure that the views of the
  Government and the people are reflected.
  
                               Chairman
        153.     And learn from the mistakes in the last IGC?
        (Mr Vaz) We will look at this area and make sure that if there are any
  points which need to be revisited that they will be. Generally speaking, as
  far as Gibraltar is concerned, we will continue ---
  
                             Mr Mackinlay
        154.     If the Gibraltar Government had been brought into the loop
  the error would not have occurred. It is very nice of you to say these nice
  things but somebody has got to speak for them. It is a question of the
  mechanism to protect their interest. You might be able to decide it is not
  important, there are other considerations, it is the cock-up one wants to
  avoid.
        (Mr Vaz) I have noted Mr Mackinlay's point.
  
                              Dr Starkey
        155.     My question relates to Russia's view of the accession to the
  EU of the Baltic states?  It has been fairly relaxed, I think, on the whole,
  although they have been extremely twitchy about them joining NATO.  Do you
  think that what you have just said about the way in which the European Union
  security and defence initiative should work so incredibly closely with NATO
  is likely to increase Russia's suspicion of the Baltic States joining the
  European Union?
        (Mr Vaz) You are right, Dr Starkey, this has not been raised with me
  by any discussions that I have had with the Russian Ambassador. As you know,
  Russia now has a new President. We have received no representations which show
  in any way that Russia is in any way concerned about the accession of the
  Baltic States. I think that what we need to do is to be absolutely transparent
  about what we are proposing to do on Defence and Security Policy and if we
  continue to do that then those around the EU and those around the applicant
  countries will understand that what we are not seeking to do is to in any way
  threaten the security or in any other way.  We are there to complete a set of
  tasks which are very transparent and people are very well aware of. I have
  received no representations and the Government has received no representations
  from the Russians to suggest otherwise.
        Chairman:   Minister, we have covered a wide ground, I thank you and Mr
  Lyall Grant very much on behalf of the Committee.