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European Union

11 am

Mr. Wayne David (Caerphilly): I was a Member of the European Parliament for 10 years. I was elected in 1989, and one of the first things that I was told when I arrived in the Chamber was that as the European Union was a democratic entity, if it applied to join itself, it would not be admitted. Of course, what was meant by that was that in those days, although the EU was strong on the rhetoric of democracy, there was little there of any substance.

However, I saw a dramatic change take place during the 10 years that I was a Member of the European Parliament, which was brought about by fundamental treaty alterations. There was the Single European Act, which Mrs. Thatcher had the good sense to support, and the treaties of Maastricht and Amsterdam.

Because of those treaty changes, the European Parliament has significant democratic powers today. It has the power of scrutiny over other bodies such as the European Central Bank and the European Commission. It has significant budgetary powers, and can have significant influence over the EU budget for non-compulsory areas of expenditure. Most importantly, it has a range of different and significant legislative powers, chiefly the power of co-decision, which the Parliament uses in a responsible and coherent way.

The powers of the European Parliament were most clearly demonstrated in 1999, when it dismissed the Santer Commission en bloc. That single act had a profound influence on the people of Europe's perception of the European Parliament. It also markedly changed the power relationship between the European Commission and the Parliament. We should remember that the European Parliament is the only institution that is directly elected by the people of Europe. National Parliaments and the European Parliament should work together in partnership.

Mr. Richard Spring (West Suffolk): Would the hon. Gentleman care to observe whether he thinks that the sense of connection between MEPs and the electorate has been enhanced or diminished by the change from first past the post to a list system of election?

Mr. David : My personal view is that the move to the unfortunate form of proportional representation that we now have was a retrograde step. I am convinced that first past the post is the most appropriate method of election in this country for all tiers of government—and that definitely applies to the European Parliament.

As well as the European Parliament, there is the European Commission. The Commission is the custodian of the European treaties. It has the sole power to initiate legislation. It represents the EU as a whole in trade negotiations, provides the administration of the EU and overrides sectional interests in the broader interests of the Community as a whole.

As well as having those significant powers, the Commission is the subject of constant criticism, not least by the tabloid press. How many times have we heard tales about square strawberries and straight bananas, attempts by the Commission to introduce

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fishermen's hairnets, and other nonsensical stories? When I was a Member of the European Parliament, the fishermen's hairnets story was running in the UK tabloid press, and I made inquiries of the Parliament and the Commission to see where that story had emanated from. No one had any idea. Almost in desperation, I visited a famous watering hole in Brussels called Kitty O'Shea's for half a Guinness, and lo and behold, I met the members of the British press corps joking among themselves. They had invented the story about fishermen's hairnets and sent it back to the UK, and to their amazement, it hit the front pages of the newspapers. That is a fair indication of how the irresponsible press in this country all too often misrepresents what happens in the European Union.

It is worth remembering that, although it is not faultless, the European Commission has only 17,000 civil servants—a bureaucracy far smaller than the many Government Departments in this country. The EU bureaucracy is also one of the most open that I have come across. It is often easier to gain access to Commission civil servants than it is to civil servants in this country.

The third element of the triumvirate of important institutions in the European Union is the Council of Ministers. It is there that power ultimately resides; it is there that most decisions affecting the development of the EU and the lives of European citizens are made, whether through unanimity or qualified majority voting.

Over the past couple of years there has been an increase in the influence of the Council of Ministers, particularly over the second and third pillars of the European treaties—the pillars of common foreign and security policy and the embryonic European defence and security policy, and justice and home affairs. People often ask whether the Council of Ministers is democratic. The European Council meets four times a year. It is made up of democratically elected Heads of Government, who are drawn from national states. The Council of Ministers, which makes many key decisions, is made up of national Government Ministers, elected by the people and accountable to national Parliaments. It is important to bear such matters in mind when considering democracy in the European Union.

Many unfair criticisms are made of the EU, and they are often extremely nationalistic in tone. Nevertheless, we have to accept that most people in the European Union regard its institutions as remote. Some regard them as irrelevant, and that is clearly shown by the low turnout for the European Parliament elections, not only in this country but in other EU countries. Those of us who believe in Europe and in democracy must accept that things have to change, and change radically. The status quo cannot be the way forward. I was pleased therefore that there was clear acceptance of that at the Laeken summit. A key extract from the declaration agreed by member states at Laeken is:

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I agree 100 per cent. with that declaration. Such a clear statement was a monumental step forward. Following that, a decision was made at Laeken to establish a convention to consider the future of Europe. The convention on the future of Europe has already begun its deliberations, and although it is early days, significant progress has been made. I hope that strong recommendations will be made to the next intergovernmental conference. The convention comprises Ministers from the member states, and representatives of the European Parliament, the European Commission and the United Kingdom Parliament. I am pleased that our representatives are already reporting back to this Parliament effectively, and I hope that that will continue.

We have a long way to go, but the situation is encouraging. I am pleased that the European Scrutiny Committee is already making a significant contribution to the debate on Europe's development, which must be held here and in the institutions of Europe. I warmly commend the European Scrutiny Committee's report to hon. Members, and I hope that they will take the trouble to read it. If it is implemented, it will have a profound effect for the better on our future work. I also hope that representations about debating the report fully on the Floor of the House will be taken up, and that there will be such a debate in the near future.

Angus Robertson (Moray): The European Scrutiny Committee published a report on the scrutiny of European business in the United Kingdom. One of its recommendations was that we should consider lifting the confidentiality of the relationship between the different Administrations in the UK. Does the hon. Gentleman agree that his colleague the Minister should listen to that suggestion and pursue it? After all, we are talking about transparency, democracy and accountability, which are relevant to the UK as well as to the European Union.

Mr. David : As I said, democracy and transparency are essential, given the relationship between the different elements of government that now exist in the United Kingdom. Our democracy is evolving internally, which means that democracy and transparency must always be scrutinised so that we have the best possible systems.

I will focus briefly on some of the changes that I would like to see over the next few months, and on how Europe might develop. This is not the time or the place to debate in detail the report of the European Scrutiny Committee, but my comments are complementary to the thrust of its arguments.

The European Union is an association of independent sovereign states that decide from time to time to pool their sovereignty in their mutual best interests. If hon. Members accept my definition of what the EU is in essence, it follows that the Council of Ministers has a pivotal role in the EU's development. I want far more coherent intergovernmental co-operation and better organisation of the Council's work. It is significant that there was a step forward in that respect at the summit in Seville. However, we have much further to go, and I hope that that issue will be carefully considered.

We must consider especially the ending of the six-month presidency of the European Council. We talk about the future enlargement of the EU and an increase

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in the number of member states from 15 to 25, so it is nonsense to have a rotating presidency and, as a consequence, a shifting agenda every six months. I would like the Council of Ministers to have a more permanent chair; I would even like consideration to be given to the idea of a president—but before anyone suggests that that should be Tony Blair, I must say that my right hon. Friend the Prime Minister is already doing a good job here. No Labour Members would like him to move from his effective role in this country.

We should consider more generally the need for better organisation of the work of the Council of Ministers. It needs an annual agenda, a work programme, and, above all, a clear sense of strategic direction. We need to know where the European Union as a whole is going, not only in a few months' time, but in the years ahead. The Council of Ministers should be responsible for providing that sense of purpose and direction.

There is also a need in certain areas for intergovernmental co-operation to be strengthened, particularly in terms of deepening the common foreign and security policy and the EDSP. The relationship between the European Commission and the Council should perhaps be redefined. Inevitably, we need to look objectively at whether qualified majority voting should be adhered to or extended. There is a case for that in some areas, but in others there is not. The issue must be examined carefully, in our national interest.

One vital reform to reinforce democracy would be for the Council to make its legislation in public. In a modern democracy, it is unacceptable for the Council of Ministers to meet behind closed doors to agree legislation that will affect the citizens of Europe, including those of our country.

Another area that needs careful examination is the role of the European Commission. I am one of the people who believe that the European Commission should be more accountable; although it should retain its right of initiative, political direction in the EU should come from the Council of Ministers. The European Commission should be less of a political body and more of a civil service, taking its lead from the elected representatives on the Council.

I shall not dwell on the subject of national Parliaments, other than to say that they have an essential role in the development of democracy in the EU, in scrutiny and, vitally, in defining whether the principle of subsidiarity is applied. Subsidiarity is essentially a political rather than a judicial term.

Angus Robertson : I am grateful that the hon. Gentleman has brought up the issue of subsidiarity, because it is relevant not only to member states but to sub-state legislatures. The transfer of information is another key area. The Government have stressed repeatedly that they do transfer information, but the hon. Gentleman will be aware of correspondence from the Department for Environment, Food and Rural Affairs and the Foreign Office confirming that agendas of Council of Ministers meetings have not been forwarded. He will also know that despite the Government's assurance to the European Scrutiny Committee that that practice will end, there has been a

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more recent example of information not being forwarded. How can subsidiarity be properly observed if Whitehall Departments do not forward information to the Welsh Assembly, the Scottish Parliament or the Northern Ireland Assembly?

Mr. David : I repeat that I genuinely believe that the Government are willing to ensure that there is participation and accountability. However, the mechanics to achieve that aim are not always in place—and that applies to Whitehall Departments. The relationship with the devolved institutions is a developing one, and it will take time to make sure that the mechanics are in place effectively. One of the most impressive aspects of the devolution settlement is the good relationship between central Government and both the Scottish Parliament and the National Assembly for Wales. We need to build on that good will to ensure that the settlement works as effectively as possible.

As I said, the European Parliament has considerable powers and, given the complexity of the legislative processes with which it is involved, we need to ensure that its involvement is as effective and efficient as possible. It also needs more openness. The co-decision process is complex but needs to be far more transparent. The emphasis should be on that, rather than on giving the European Parliament more powers for the sake of it. We should bear in mind the fact that turnout in the previous European Parliament elections was just 24 per cent. in this country. The emphasis must be on raising the credibility and acceptance of the European Parliament, rather than arguing for it to have still more powers.

My thesis is that although the European Union is not as undemocratic as many claim, there is room for significant improvement. I hope that the convention on the Future of Europe will make proposals about how Europe can be made more democratic that are acceptable to all member states and parties. Above all, as well as arguing for democracy, we must take that opportunity to define a new vision for the people of Europe.

Perhaps we politicians should speak less about comitology, proximity and subsidiarity, and more about issues to which people can relate more easily, such as jobs, peace and the environment. That is why a good starting point for the new treaty that I hope will result from the next intergovernmental conference would be to define clearly what European co-operation is all about. If we do that, we will have a good chance of one day making the EU popular among all the people of Europe.

11.21 am

Mr. John Randall (Uxbridge): I congratulate the hon. Member for Caerphilly (Mr. David) on introducing the debate and on trying to unravel the complex and rather mysterious ways of the European system for people such as me, who are not great experts on the intricacies of that institution.

I am keen on enlargement of the European Union, because apart from anything else, most if not all the aspirant countries see it as a means of strengthening their own democracy. In recent times many of those countries suffered regimes that were far from

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democratic; even in today's world, those democracies could sometimes be regarded as fragile. Indeed, in my lifetime, existing members of the EU have had regimes that we would not regard as democratic. One thinks of Portugal under Salazar, Spain under Franco and Greece under the colonels. However, now it would be strange to think of those countries as not at the forefront of democracy. Not long ago some countries that hope to join the EU, such as Romania and Bulgaria, were perceived as among the most undemocratic countries not only in Europe but in the world. We must therefore make progress on enlargement and other issues.

There is, however, always a problem. If the processes are not correct, the smaller countries will feel that the large countries will overrule them. That is undoubtedly a difficult balance, as one of the Balkan countries has shown. One of the many complex reasons for the break-up of Yugoslavia was that some of the smaller republics in the federation felt that the larger two republics—Serbia and Croatia—were constantly overruling them. Again, I ask the Minister to say how the moves to admit Yugoslavia to the Council of Europe are progressing.

As the hon. Member for Caerphilly said, many British people wonder how the EU works. Some of its procedures seem so shrouded in mystery that people wonder what influence they have on it.

After an intervention by my hon. Friend the Member for West Suffolk (Mr. Spring), the hon. Member for Caerphilly spoke about elections to the European Parliament. I have never seen people so worked up about electoral arrangements: the current system of party lists seems so unfair. For the benefit of Labour Members, I should explain that one of their London MEPs wisely decided to join the Conservatives—surely there is a democratic deficit in that the individual was elected under a party list system and those who voted for a Labour MEP now have a Conservative one. They should be delighted because, like the gentleman concerned, they have realised the error of their ways. However, it is patently not very democratic when someone elected on a party list system crosses the Floor.

Mr. Michael Moore (Tweeddale, Ettrick and Lauderdale): I am intrigued by the hon. Gentleman's argument. My party has always supported the single transferable vote and we accept that the existing system has major weaknesses. However, what is the difference between what the hon. Gentleman describes and the first-past-the-post system, under which many people have crossed the floor to join different political parties?

Mr. Randall : I understand the hon. Gentleman's point, but first past the post applies to constituencies and single members. Rightly or wrongly, most people do not vote for the person, but the party. Those elected always claim that they were voted in as a person. However, the system that I am describing is overtly wrong because people vote for a party, and the system does not stand up when those elected change their party allegiance. I often wonder what would happen if a by-election were always necessary when members crossed the Floor; I doubt whether they would be so ready to do so. It is largely a matter for individual Members' consciences, but if people are elected under a party system there should be no doubt about what that should entail. That is just one example of why people regard the processes of the EU as undemocratic.

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The hon. Member for Caerphilly spoke about rolling six-month presidencies. I understand his point, but further questions arise about a directly elected president. No one wants failed politicians dumped into that position in order to get them out of the way. Who will do the direct electing—the whole population or a smaller constituency? How will that affect smaller countries, which might conclude that there will always be a French, German, Italian or British president? The system is so large and unwieldy that we must be careful about how we progress.

Mr. Win Griffiths (Bridgend): The hon. Gentleman raises an interesting counter-point. In a European Union of 25 or more countries, the presidency might come round to every country once every 12 years or so. As my hon. Friend the Member for Caerphilly said, we need to rethink the process and find a way, perhaps through regional blocs within the EU, to establish agreement on how to organise the presidency in future.

Mr. Randall : The hon. Gentleman makes a fair point. I am not advocating a particular system. I am not sure of the benefits of the current presidency system even with the existing number of member states. With an enlarged EU, it would become unwieldy.

I have always shied away from the complexities of the European Union and concentrated more parochially on matters that affect the United Kingdom and, more importantly, my constituents in Uxbridge. The EU's problem is that it seems distant from the everyday lives of my constituents, except when they are seemingly told that they cannot do this or must do that because of Europe. That is a spurious impression, which we in this House sometimes use as a let-out. However, if their Member of Parliament—admittedly not one of the world's greatest brains—cannot give an answer, it is difficult for the average person in Uxbridge to ascertain how decisions are made.

Time is short, and I do not want to labour the point, but if the EU is going to persuade the people of this country of the merits and benefits of membership, it must get its own house in order. For the EU to ask for reruns of referendums until it gets the right answer is more like what happens in Whips Offices than what happens in a democratic institution.

Mr. Deputy Speaker (Sir Nicholas Winterton): I call Mr. Win Griffiths.

Mr. Win Griffiths : I had not requested to speak, Mr. Deputy Speaker. I have to leave before the end of the debate, and it would not be fair on other Members.

Mr. Deputy Speaker : I have never been present at a debate of this importance in which no one has risen to speak.

Mr. Moore rose—

Mr. Deputy Speaker : Mr. Michael Moore will start the winding-up speeches for the Liberal Democrats.

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11.31 am

Mr. Michael Moore (Tweeddale, Ettrick and Lauderdale): Thank you, Mr. Deputy Speaker. Like you, I think it is a shame that there are not more willing participants in the Chamber for such an important debate. It rather weakens the argument of this place that we want more scrutiny over European affairs if we cannot muster more than two contributions before the winding-up speeches. However, that does not detract from the importance of the issue. I congratulate the hon. Member for Caerphilly (Mr. David) on once again focusing our minds on an important aspect of European business. There is perhaps nothing more fundamental than the democratic nature of the institutions of the European Union.

The EU has been in existence for close to 50 years and has evolved considerably during that period. Its original aims and objectives focused on underpinning the security of nation states that had spent much of the previous few hundred years at war with one another. It also had the desire to develop and promote prosperity within the member countries, and at all times it has been a club for democrats. As the hon. Member for Uxbridge (Mr. Randall) said, within living memory the Governments of Spain, Portugal and Greece were not suitable for membership of the EU. There were dictators at the heart of Europe, but the carrot of EU membership was important in those countries' rapid progression towards democracy. Those democracies have undoubtedly developed and are now full partners in the Union.

We hope that we are poised on the verge of significant enlargement. Many countries that were once under the shadow of the USSR are poised to entrench their democracies in the EU. Of the current applicant countries, only Turkey fails to meet the political criteria set out by member states years ago at the Copenhagen summit, and cannot expect to join until that is resolved. Those countries are rightly focused on the democratic values and institutions that allow them to become part of the EU, but as the hon. Member for Caerphilly briefly outlined, there is an unhappy contrast between the democratic responsibilities of those who wish to be part of the club and the practices of the club itself. He mentioned that in 1989 the question was asked whether the EU would be admitted to its own club—and many could still argue that point today, but I hope that we can afford to be optimistic that the process of reform will develop a momentum to tackle many of the weaknesses.

The crisis of legitimacy, which is at the heart of the EU, rightly gives rise to much soul searching. We hear a lot about the democratic deficit, the failure of accountability and the need to reconnect the electorate with a plethora of unloved European institutions. Many of the failings of those institutions have been rehearsed this morning. There is a lack of clarity about the EU's purpose, with no clearly defined mission statement and a legislative footprint some 80,000 pages high, and rising. There is no clear focus on subsidiarity, which would ensure that decisions were taken at the most appropriate level in the EU.

As has oft been remarked, there is clearly a lack of openness in key institutions. Perhaps most damagingly, there is a lack of accountability, because of the inherent imbalance both among the EU's institutions and between the institutions and member states.

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Angus Robertson : Does the hon. Gentleman not agree that one of our greatest challenges is to end the perception that the EU is based simply in Brussels, rather than also being close to home, with member state Governments and devolved Governments? Ending that perception might help to change the way in which the Government work in a European context. The EU is not only over there; it is over here, too.

Mr. Moore : I agree with the hon. Gentleman. There was an unasked question about how the Scottish Parliament and other devolved institutions should relate to that idea, and I agree with the hon. Member for Caerphilly that this is clearly an evolving process. No one would accept that those relationships are fully developed, but as devolution beds down, we need to learn what the right level for decision making is.

Angus Robertson : Does the hon. Gentleman not agree that as a minimum, we should hold to the rules clearly laid out in the concordats that govern the relationship between the UK Government and the Executives of Scotland, Wales and Northern Ireland? Devolution is an evolving process, but when the relationship between Governments is governed by rules, those rules should be held to, and they should be transparent.

Mr. Moore : I must make it clear that I do not share the hon. Gentleman's view of what the devolution process might evolve into in the end, and I have no wish to see Scotland independent from the rest of the United Kingdom. However, I agree that rules should be adhered to, and I pay tribute to his sometimes lonely one-man battle against everything in Whitehall in which he feels that Scotland is not getting its share. I wish him luck in that.

Mr. Bill Tynan (Hamilton, South): Obviously it is essential that the Scottish Parliament should be deeply involved in Europe, and that Scotland should also be part of the UK. However, does the hon. Gentleman not agree that the real challenge, especially in view of the enlargement of the EU, is to connect with the people in more detail and ensure that they understand EU procedures? We do not want them to feel divorced from the decision making.

Mr. Moore : I am in danger of talking myself into a cul-de-sac in which I shall not be able to make the points that the hon. Gentleman has just made. I am grateful to him for refocusing our discussion. The hon. Member for Moray (Angus Robertson) may not agree, but because Scotland is still in the early years after devolution, we should see how its relationship with Europe develops and recognise that its future is best secured as part of the United Kingdom.

Angus Robertson : Will the hon. Gentleman give way?

Mr. Moore : I have given way to the hon. Gentleman twice already, and I want to make progress—

Mr. David Drew (Stroud) rose—

Mr. Moore : I shall take just one more intervention, and give way to the hon. Member for Stroud (Mr. Drew).

Mr. Drew : I apologise, Mr. Deputy Speaker, for not being present at the start of the debate; otherwise, I would certainly have tried to catch your eye.

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The hon. Gentleman spoke about the isolation of MEPs. My problem is more with what happens when they come over here. I am thinking of the farce of the current so-called foot and mouth investigation being carried out by MEPs. We should examine more fundamentally the relationship between MEPs and Members of this House, because of the way in which people can trample into one's constituency without any recognition of the damage done. All the wrong impressions can be created, so is it not time to examine the relationship more carefully?

Mr. Moore : I do not want to be dragged into the hon. Gentleman's private grief. He has clearly suffered from specific difficulties, on which I cannot comment. However, those problems can emerge as democracies evolve—in Scotland, for example, because of the Scottish Parliament. Some hon. Members are unhappy about the presence of Members of the Scottish Parliament on their territory. Frankly, we all have to learn to live with one another. It would surely be wrong to prevent MEPs elected in this country from visiting parts of it to investigate important issues on a European basis.

Before I generously gave way to several colleagues, I was arguing that over many years we have lost any clear focus on what European institutions are about. The lack of openness and accountability has led to increasingly poor awareness of what is going on among EU voters and growing hostility to much of what the EU quite properly seeks to achieve. A quick glance at the Euro-barometer polls will confirm that.

The EU has several handicaps to overcome. It is necessarily distant because it is "over there". I welcome the participation of its representatives in domestic British political life as well as in Strasbourg and Brussels. Much EU argument is also necessarily technical, but perhaps the biggest handicap is that the EU has had to evolve from tackling one set of problems from a particular era to tackling another set in today's considerably different political context. It is right to scrutinise the purpose of European institutions and to realign them to tackle today's problems more effectively.

We cannot afford to be apologists for the EU, but we can dare to be optimistic. As the EU prepares to admit up to 10 new member states, we know of widespread acceptance of the need for reform, and the convention on the future of Europe is addressing that right now.

Our party is reviewing its policy towards the EU to take account of the changing nature of the European body politic. We have consistently supported the need to reform European institutions and warned of the urgent need to tackle the alarming gap between those institutions and the electorate. First and foremost, we need a clear statement of what the EU is about. We therefore vigorously support the idea of a constitution for the EU, simplifying the many treaties currently in existence, and defining and limiting its powers. If citizens are to have a stake in the European Union, the charter of fundamental rights must be at the heart of the constitution. It is vital for the institutions to make subsidiarity a reality. Decisions should be local where possible, national where necessary, and European where appropriate.

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Not only should the principles be embedded in a constitution, but we should ensure that the European Parliament and national Parliaments have an ongoing role in putting them into practice. Much greater openness is required to achieve those aims. All institutions should, as a basic premise, conform to the principles of freedom of information. The Council of Ministers should meet in public when it discusses legislation. A full account of those proceedings and the decisions that have been taken should be published as a matter of course, and should be available for scrutiny in the European Parliament, and in this and other national Parliaments. We should not have the constant battle of having to table the right parliamentary questions to get information out of Ministers.

Greater accountability is also important. The leader of the country that holds the presidency should appear before the European Parliament before and after meetings of the Council. Many different views have been expressed about a rotating presidency. The Liberal Democrats are agnostic on the issue at present—we will watch how the debate develops. The annual "State of the Union" address given by the President of the European Commission should be accompanied by detailed proposals and justification for them under the constitution—particularly with regard to subsidiarity. Commissioners should be scrutinised about their proposals by the European Parliament, which should have the power to vet and veto each Commissioner, not simply the whole group en masse.

The most important aspect of the matter relates to Westminster—we too need to step up a gear. I pay tribute to the work of the Committees that scrutinise European Union activities in both Houses. However, we need to make Ministers' accountability a bigger deal. Perhaps the Minister will tell us when he expects to give evidence to the Committees on the work of the convention, and particularly on the Government's view of how Europe should look after 2004. He had an opportunity to set that out in a recent debate before the Laeken summit, and he has another opportunity to do so this morning. We are still short of specifics. As we approach the recess, and face the prospect of the convention making some key decisions before we return in the autumn, it is scandalous that we still do not have a clear picture of the specifics that the Government will propose and the position that they will seek to negotiate in the convention.

In this Parliament, we pride ourselves on being closer to those who elect us than the European Union institutions are to those who elect them. That may be one of our bigger conceits. If we are to ensure that it is true, we need to raise our collective game. We need to ensure that all substantial Government plans for the Council of Ministers are put to Committees before they are discussed in the Council of Ministers itself. Ministers should, as a matter of course, be required to attend key Committees after meetings of the Council, in order to be scrutinised on what they have been doing.

Europe is, unfortunately, largely unloved. That is partly the fault of those who represent its institutions to the outside world and partly a result of the actions of those who disagree with its very construct. That is politics. We should be ambitious for the European Union; it is a precious idea that needs fostering. However, those ambitions should relate not simply to

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extending the scope and power of the institutions, but to reforming what we have. We should make the European Union more capable of carrying out its existing functions and more in touch with the people on whose behalf it exists.

11.49 am

Mr. Richard Spring (West Suffolk): I congratulate the hon. Member for Caerphilly (Mr. David) on securing this debate. He is a passionate enthusiast for enlargement, and I applaud him for that. I entirely share those sentiments. I also thank him for his insights based on his knowledge of the European Parliament and its workings, which are an important part of the architecture of the European Union.

A lively debate is taking place about democracy and the EU, much of it surrounding the convention on the future of Europe. We believe that reform of the EU's institutions should be based on three elements. First—this is now almost universally agreed—the EU suffers from an acute democratic deficit. The power wielded through its institutions must be made more accountable through greater transparency and greater responsiveness to people's wishes. Secondly, the principle of subsidiarity—at present theoretically embedded in the acquis communautaire but in reality ineffective—must become truly efficacious. That is a crucial point. The history of the EU has been one of working from the top down. That is no longer acceptable. The EU must now work from the bottom up.

Thirdly, it should be recognised that the member states are the fundamental constituent entities of the EU. Any reform that fails to understand that will not succeed; indeed, the first two principles fold into the third. The peoples of Europe naturally look to their national Parliaments to hold the exercise of power to account. They are also the main means for the expression of their wishes. That has become even more the case now that we have moved away from the first-past-the-post system for elections to the European Parliament. Change in Europe should flow upwards from the peoples of Europe; they should not be driven centrally. If we cleave to those three principles we can help to cure the alienation of the EU from the peoples of Europe, and reform an enlarged EU into something that delivers what its peoples want.

Angus Robertson : I know that the hon. Gentleman is well read, so I am certain that he will have read The Scotsman yesterday. On the issue of centralism and power exercised at the centre, was he as surprised as I was—I was delighted, although slightly confused—to read that

Is the hon. Gentleman surprised that we have not heard anything officially from the Government on this? Does he share my hope that the Minister, who was mentioned in the article, might be able to tell hon. Members what the Government's policies are?

Mr. Spring : I am sure that the Minister for Europe will have heard that, and he will be able to confirm or

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deny what was reported in that august newspaper. I am sure that the hon. Gentleman will agree that leaks and spinning, rather than directly telling Parliament what is going on, is one of the Government's most unattractive characteristics.

I am sorry to say that the Government have been disappointing in their failure to find constructive solutions to the challenges that the EU faces. They have had two big ideas for the reform of the EU's institutions. One has been shot down in flames, and the other has done a magnificent job of raising the hackles of the smaller member states. The Prime Minister's proposal to set up a second chamber of the European Parliament was greeted with silence and/or embarrassment by our EU partners. The House of Commons European Scrutiny Committee rejected the proposal and the subtitle of the report by the House of Lords European Union Committee—

spells out its unacceptability. I hope that the Government will stop promoting this impractical scheme and turn to something more constructive.

Mr. David : Does the hon. Gentleman not accept that by raising the issue of a second chamber of the European Parliament, the Government have ensured that the debate about the role of national Parliaments is centre stage?

Mr. Spring : The fact is that there is a void in the Government's practical thinking on the future architecture of the European Union. I do not accept that the Prime Minister raised the issue simply to underline the importance of national Parliaments, and I do not believe that our European partners saw it in that light either.

The plan for a president of the European Council was referred to as—I quote from the Financial Times:

His legitimacy would, apparently, be that he would be

There are three main difficulties with that proposal. There is insufficient time to discuss the first, which is such a president's over-powerful and undefined role in foreign policy. The second is the matter of accountability, which was tellingly raised by my hon. Friend the Member for Uxbridge (Mr. Randall). How would that individual be appointed? To whom would he or she be answerable? How could he be sacked if member states were unhappy with his conduct? The proposed position would be influential, but at present its legitimacy would be tenuous. Those are all-important questions.

It is absolutely right that we should consider the role of the presidency in the light of the enlargement process, but it is important to ask how such a post would enhance democratic accountability in the European Union. We accept that that will be a major challenge. I hope that the Minister will answer those questions in some detail in due course. Thirdly, any proposal for reform of the European Union must take account of the different hopes, needs and fears of its larger and smaller members if it is to be workable.

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To be fair to the Minister, I welcome the reform of the workings of the Council introduced at Seville. Britain played its part in bringing them forward, but it is disappointing that the Government have not spent more of their time on practical, substantive reform measures.

Mr. Drew : I am listening to the hon. Gentleman's arguments, but they would have more credibility if the previous Government, whom he supported, had not ceded economic power through the Single European Act. Would the hon. Gentleman care to wax lyrical on the dreadful mistake that his Government made in giving away economic powers? Now it looks as if we are giving away political powers too.

Mr. Spring : I hope that the Minister heard that comment. The creation of the single European market has been the crown jewel of what has happened in the European Union. An enormous trading area, which will be expanded in due course, and which has greatly benefited all Europe's citizens, has been created. I am disappointed by the hon. Gentleman's view, as I cannot think what the alternative would be. This is one instance in which the European Union as a trading bloc has particular clout in its discussions with other important trading countries and blocs. The sooner we remove the inhibitions to trade across the European Union and diminish the restrictions involved, the better. It was one of the most impressive things that the Conservative Government sought to introduce, given our commitment to the free enterprise system.

The European Scrutiny Committee's report must be commended; it is a model of intelligent analysis of the EU's failings and needs. It rightly identifies the disconnection between the EU and its peoples as a central problem. As it says, the Council's lack of openness is unacceptable, and a few television cameras will not mend that. If the Council, which should be the driving force in the European Union, cannot become accountable, the EU will never be properly answerable to its citizens. As the report says, parliamentary scrutiny needs to be fundamentally enhanced.

I was interested in some of the points made by the hon. Member for Tweeddale, Ettrick and Lauderdale (Mr. Moore) about how we could enhance scrutiny. Consideration of how that can most usefully be done crosses any party political divide.

Angus Robertson : As for cross-party unity on scrutiny, does the hon. Gentleman agree that scrutiny should also be exercised in relation to the scrutiny reserve in Parliament and the Assemblies of the United Kingdom that have a legislative role, so that where power is exercised by people elected to those Administrations, they can influence the European decision-making process more effectively?

Mr. Spring : Scrutiny in any Parliament, Assembly or council in the United Kingdom is vital to the democratic process. We are especially persuaded by the recommendation to replace civil service representation on COREPER with a senior Minister based mainly in Brussels, but answerable directly and regularly to the House of Commons. That would be a great advance in making the Council's processes accountable to national Parliaments. By taking that step, Britain could set an

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excellent example to other member states. I was delighted that the Council's report backed the creation of a subsidiarity watchdog. Conservatives have been pressing for such a body for some time. I am especially pleased that the Scottish First Minister backed the idea that I put to the European Committee of the Scottish Parliament when I gave evidence for its report on the governance of the EU. The hon. Member for Moray (Angus Robertson) will be aware of that. As the Scottish First Minister says:

I hope that the Minister, too, will agree with our sensible proposal.

Importantly, the Committee's report proposed that such a body should be composed of elected politicians, not judges. No one disputes that the European Court of Justice cannot help but prefer action to be taken at a European level, as it is a European body. That is clear from its poor record of enforcing the principle of subsidiarity in its judgments. The only way of making subsidiarity real is through the enforcement of that principle by a body composed of politicians from national Parliaments.

No part of the European process creates more unease among Europe's citizens than the so-called ratchet effect. Europe appears to many to be on a journey with no clear end, and with ever more powers pushed towards the centre. That end must be defined, as we need a sense of finality. That worry is not confined to Britain. The German lander are concerned about their relationship to the federal Government, and about the intrusion of central European institutions.

Two actions must be taken if such intrusion is to be stopped. First, we need the clearest possible definition of competencies. I was pleased that the European Scrutiny Committee reached the same conclusion, that what is done should be the minimum possible. Secondly, it should be clear that we shall obtain a sense of finality only when the phrase "ever closer union" is deleted from the treaties. It sums up the perception in the EU that the Union is engaged in a one-way process towards greater centralisation, regardless of what citizens want. The report of the European Scrutiny Committee was clear about that. The removal of the phrase could help to guide the European Court of Justice towards a less centralising jurisprudence, and send a signal that there had been a reappraisal of what an enlarged EU is all about.

I shall add one last point. It is widely recognised that the Community method, particularly the role of the Commission, is not democratic. Unless there is reform we will never achieve the end that we desire: a democratic and accountable European Union. I understand that the smaller member states regard the Commission as necessary to ensure that the larger states do not dominate the EU, but we believe that the Commission's role must be transformed. It must work much more as the servant rather than the master of the European process.

A European Union of nation states, with national Parliaments at its heart, is not only desirable but achievable. Indeed, we believe that only a union based clearly on member states and recognised as such will

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satisfy today's need for democracy and reverse popular disconnection and disengagement from Europe's institutions. Archaic dirigiste structures and grand constitutional plans will not achieve that end. The Prime Minister, the Foreign Secretary and the Minister for Europe have frequently analysed correctly and persuasively the challenges facing the EU, but have totally failed to come up with specific, substantive and clear proposals to address those challenges. I hope that the Minister will take the opportunity, on behalf of the Government, to show the leadership and direction required to fill that void.

12.6 pm

The Minister for Europe (Peter Hain) : I may surprise the hon. Member for West Suffolk (Mr. Spring) in the next few minutes. I agree with much of what he said. I am grateful to my hon. Friend the Member for Caerphilly (Mr. David) for initiating the debate. He brought to it the considerable expertise that he developed before coming to the House in his role as a senior member of the European Parliament and a respected leader of the Labour group. I am also grateful to the European Scrutiny Committee, of which my hon. Friend is a member, for its excellent report, to which we will soon reply formally.

The suggestion by the hon. Member for Tweeddale, Ettrick and Lauderdale (Mr. Moore) that we have not been open about our role in the convention could not be further from the truth. This afternoon I shall give evidence on the reform agenda in Europe, the Seville proposals and the work in the convention to the House of Lords Select Committee. Next week I shall give evidence to the European Scrutiny Committee of this House. Both those will be second appearances on that agenda.

Mr. Moore : I do not suggest that the Minister has not made himself available at the right moments; I said that we did not have a specific list of proposals that the House could scrutinise and debate. Have the Government plans for a White Paper on Europe, for example, setting out such proposals?

Peter Hain : We have no anxiety about openness but, as I am sure the hon. Gentleman understands, we are in the early stages of the convention. We are in the process of charting where the land lies and seeing which ideas will gain support. We are therefore reluctant to present at this stage a White Paper or blueprint to assemble coalitions of support—although that is what I seek. However, I understand the point that the hon. Gentleman makes, and we will keep the House continually informed.

The exercise of democratic control goes to the heart of people's concerns about Europe: the idea that its decision-making process is impenetrable and indistinct, and that there are no clear means by which they can influence those decisions, so Europe is something done to them, not by them. The right hon. Member for Kensington and Chelsea (Mr. Portillo) asserted in The Times last week that the EU was not democratic, and could never become so because it is impossible to create pan-European institutions that people in nation states

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with such fundamentally differing value systems could respect. I do not accept that. The scale and diversity of the EU undoubtedly present particular challenges but it is as wrong to assert that Europe has no democratic legitimacy as it is to say that we cannot improve on what we have.

Mr. Randall : I feel a bit guilty for interrupting the Minister's flow, but on the subject of democratic deficiency, does he agree that the effective disfranchisement of the people of Gibraltar does not set a good example? Is he confident that they will be able to vote for a Member of the European Parliament by the time of the next European elections?

Peter Hain : Yes.

The EU is a unique and ambitious construct, and has been remarkably successful. It has been a key factor in preserving peace in western Europe for the longest period in the continent's history. It is an engine for jobs, investment and economic growth through the single market. The EU is a force for better environmental protection, and against cross-border crime. Our security, prosperity and quality of life are enhanced enormously by common action on those and other matters.

The hon. Members for Uxbridge (Mr. Randall) and for Tweeddale, Ettrick and Lauderdale rightly referred to enlargement. Both made the important point that extending Europe's boundaries will extend the zone of democracy, stability, peace and respect for human rights. The hon. Member for Uxbridge made telling points about the fact that Portugal and Spain, as modern European democratic nations, are unrecognisable when we think of their history of fascism. The same will apply in due course to Bulgaria and Romania, about which he also made valid points.

The hon. Gentleman asked whether the Federal Republic of Yugoslavia would be admitted to the Council of Europe. The intention is that that will happen at the ministerial meeting in November. However, we and others seek further undertakings between now and then on co-operation with the international criminal tribunal for Yugoslavia in The Hague.

The structures that we have set up to deliver on Europe's ambitions are necessarily unique. For people who are used to the decision-making structures of nation states, that is unfamiliar and sometimes uncomfortable. There is, thank goodness, no single Government to elect or throw out, but that does not make the EU undemocratic. I am held to account by the House, as all Ministers in the EU are by their Parliaments. The Commission must regularly account for itself to the European Parliament and the Council of Ministers. As my hon. Friend the Member for Caerphilly reminded us, that consists of elected Ministers, representing elected Governments. The base of authority is democratic.

The EU's authority also comes from a framework of treaties that have been agreed unanimously by member states' elected Governments, and ratified by their elected Parliaments. The base of democracy is also established in that way. To the extent that the treaty provisions involve pooling of sovereignty, that has been freely

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accepted by elected representatives in Britain and throughout the EU. The same applies to the supranational institutions that we have established. Successive British Governments and Parliaments have signed up to those not because of a dogmatic commitment to greater European integration, but because each has believed that that was in our national interest.

Let us nail the nonsensical view that it is inherently undemocratic, and peculiar to the EU, to set up unelected institutions with their own powers. The right hon. Member for Kensington and Chelsea asserted that it was undemocratic of the European Central Bank to set the euro interest rate. However, we granted the Bank of England independence over the sterling interest rate. That has been hugely successful, and has widespread support in the United Kingdom. The principle of ceding control to independent bankers has been accepted; the question is whether they are British or European.

Whether at EU or national level, we need powerful independent bodies to implement policies decided by politicians. The Commission's determination to push through the single market programme has been a key factor in its success. Its rigorous approach to state aids has been crucial to the competitiveness of British companies abroad. The same applies to the European Court of Justice: we need a body that can enforce the obligations that member states enter into.

The basic framework and its institutions are not undemocratic, but the way in which power is exercised within that framework and by those institutions can be much better policed by democratic bodies—a point that has been made throughout the debate.

How can that happen? First, we can have a clearer treaty framework. People feel that the complexity and ambiguity of some of the treaty's provisions are ripe for exploitation. The hon. Member for Uxbridge said that he shied away from the complexities of the EU—a luxury that I do not have. I agree with my hon. Friend the Member for Caerphilly that we need to concentrate more on the practical benefits that membership of the EU brings to all our citizens in their daily lives—better job opportunities, greater prosperity, more security from the threats of crime, drug running, human trafficking and terrorism, and higher environmental standards. Air pollution knows no national boundaries. We should speak more about those practical daily life benefits rather than use the continuous Eurospeak that streams out of Brussels.

The convention on the future of Europe is currently considering how to use the treaty to state more clearly what the EU is for and where we want it to act. We also need to be aware of its limits by establishing more clearly what should be done at a European level, and what should be left to member states at national, regional or local level.

Secondly, we need to clarify through our institutional arrangements that elected national Governments accountable to their Parliaments are the principal source of the EU's legitimacy. That means focusing on the European Council and its sectoral Councils, on which elected Ministers sit. I agree with my hon. Friend the Member for Caerphilly and the hon. Member for West Suffolk in describing independent nation states as the bedrock of the EU. My hon. Friend in particular

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provided a good definition of EU members as "independent sovereign states who decide from time to time to pool their sovereignty".

Angus Robertson : While we are talking about independence and sovereignty within Europe, the Minister will be aware of yesterday's article in The Scotsman, which, under the headline "Straw backs Scotland's Euro role", stated:

A source for the Scottish Executive is quoted as saying:

Jack McConnell

No further details are provided in this story, so will the Minister clarify what independent influence within Europe is envisaged? Will it be direct and automatic representation on the Council of Ministers? Will it allow Scotland to nominate a Commissioner, as independent countries within Europe can? Will it mean a near doubling of MEPs, which a country of 5 million within the EU would have? Will it be real independence within Europe, or is it all a second-rate spin effort by the Scottish Executive and the Westminster Government?

Peter Hain : It is neither independence nor second-rate spin; it is not first-rate spin either, for that matter. That is a straightforward answer to the hon. Gentleman's question.

We agreed last month at Seville that heads of Government in the European Council will set an overall strategic agenda and use their four meetings a year to deliver. We must make the sectoral Councils of Government Ministers beneath the European Council much more efficient. At Seville we took a step towards that by reducing the number of Council formations.

The next stage must be to find alternatives to the stop-start effect of the six-monthly rotation of the presidency. As my hon. Friend the Member for Bridgend (Mr. Griffiths) pointed out, the EU is likely to be 25 strong in a couple of years' time, so each nation is likely to secure the presidency only once every twelve and a half years—hardly much to be pleased about. The six-monthly rotation has worked against developing a strategic agenda and consistency of expertise, as well as a mature relationship with the Commission and Parliament.

We and others have suggested different national presidents for each Council, serving a longer period—perhaps two and a half years, which is half a Commission or European Parliament term—and working together as a team meeting regularly to implement the European Council's strategic agenda under a full-time president elected by heads of Government.

The hon. Member for West Suffolk asked me to spell out how that would enhance democracy. I am happy to do so. It would enhance democracy by creating a much more authoritative and accountable head of Europe who was democratically elected and answerable to elected Governments. That individual would be elected by the heads of Government, and would regularly

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report to them. I hope that the hon. Gentleman will look at this issue on its merits, rather than in a prejudiced fashion.

One of the problems with Europe is that there is no visible authority that people can identify and hold accountable, so the decisions made in Brussels are not adequately scrutinised. We think that having an elected president of the Council would solve that problem, because that person would be answerable and accountable to elected heads of Government.

The proposal would also answer another demand. I agree with the people who talk about the need for Europe to have a much more prominent global role—for it to be taken more seriously in global affairs, as a force for good. That is important. To achieve that, we must answer the famous Henry Kissinger question, "To whom do I pick up the phone in Europe?" It is not realistic to suggest that one can pick up the phone to a president who serves for six months—or to the President of the European Commission, as some people suggest should be the case—because that individual is not accountable to elected Governments and national Parliaments. We need someone to whom President Bush can pick up the phone when he wants to find out Europe's views. That would enable Europe to play a more authoritative role on the world stage.That person would also ensure that Europe's agenda was driven through the Council more effectively than at present, so that it delivered better for its citizens—a point that was made by my hon. Friend the Member for Caerphilly.

Angus Robertson rose—

Peter Hain : I will give way again shortly, as I am in a generous frame of mind, after I have addressed another issue.

The hon. Member for Uxbridge made an important point—to which the hon. Member for West Suffolk added—about the sensitivities of small countries. We are very alive to that. When the membership of Europe expands to 25 countries, 19 of them will be small countries. Those countries will be in a very powerful position, not least in determining who will be elected to the presidency of the European Council, if a decision with regard to that is eventually taken—by an intergovernmental conference, because that change would require a treaty change.

I have described the team presidency with different sectoral Councils underneath it. Five countries might share those Councils to form a team presidency, which would inevitably have a majority of small countries. It is conceivable that the president will be from a small country, and the arithmetic of the situation would lead to the majority forming the team presidency. Therefore, although the hon. Gentleman is expressing concerns that exist, they can be allayed by that proposal.

Angus Robertson : I am grateful to the Minister for being so generous about interventions.

I am very sympathetic to the case that he is making for more consistency in the Council, but I have a question about how that might work effectively in practice when the different domestic political cycles of member states

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might make it impossible for somebody to have a full term in the convenership of the Council, or on one of the lower tiers of the Council of Ministers, because people would be elected as individuals rather than representatives of a member state. How would that work effectively?

Peter Hain : We envisage that the job of elected president of the Council would be permanent, and that the post would not occupied by a serving head of Government. Therefore, the president would not be subject to the rise and fall of any particular Administration in any particular country, although he or she would be accountable to elected Governments from time to time, as and when they were formed. With regard to the team presidency, the country concerned would still hold the presidency of, for example, two sectoral Councils.

Mr. Spring : Perhaps I misunderstood what the Minister was saying, but he said that the post would be permanent. He cannot be serious, can he?

Peter Hain : No, it would be for five years. I am sorry; I did not willingly mislead the hon. Gentleman. I thought that I had made myself clear.

Mr. Spring rose—

Peter Hain : I have to make some progress, although I am happy to be open. If I have the time, I will undoubtedly take more interventions.

The proposal has still to be worked through in greater detail, but the idea widely shared by other European Governments, both large and small, is that there should be an individual elected by heads of Governments for five years. That would coincide with the length of service of a Commission or a Parliament, so there would be some continuity.

We need more openness in the Council when it is legislating, and I strongly agree with criticisms in the European Scrutiny Committee's report that meeting in private is both objectionable in principle and makes it much more difficult for national Parliaments to hold Ministers to account. As the hon. Member for Tweeddale, Ettrick and Lauderdale said, we need more openness. The agreement in Seville to open Council meetings to the public for co-decision dossiers at the beginning and end of the process is a welcome first step.

I hope that we will, in due course, be able to persuade our partners to go further and open up all meetings in which the Council is legislating. We also need to strengthen the role of national Parliaments. Their principal role is, of course, to hold national Governments to account for the decisions that they take in the Council. I believe that the Scrutiny Committee does that well. We are studying the suggestions for improvement in the Scrutiny Committee's report, and will reply formally soon.

As my hon. Friend the Member for Caerphilly said, national Parliaments should have the collective role of focusing on subsidiarity. The principles of subsidiarity and proportionality are enshrined in the treaty. Europe should act only when it adds value to national action, and when it acts, it should do so as lightly as possible,

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leaving some flexibility in implementation to member states. However, we have no effective means of enforcing that. Subsidiarity is in principle judicially enforceable, but in practice it is primarily a political judgment about what adds value. I agree with the hon. Member for West Suffolk about that.

We need a political body to police subsidiarity, a body of representatives who will be credible, have a direct link to people, understand and respect national prerogatives, want to safeguard diversity in Europe, and have no vested interest in action at a European level. National parliamentarians fulfil those criteria. It would make a real contribution to democratic legitimacy if there was an ad hoc committee of national parliamentarians who examined the European Union's work programme and relevant proposals critically, and who had powers to make the Commission and Council think again when they were over-legislating. That would combat the sense that European institutions are arrogating ever more power to themselves.

Although the hon. Member for West Suffolk was rather sarcastic about the Prime Minister's original proposals, it was the Prime Minister who put the principle on the agenda, as my hon. Friend the Member for Caerphilly pointed out. However, I agree that elected politicians, not judges, should be the arbiters on subsidiarity.

The European Parliament also has an important role. To make Europe work, Member states take many decisions by majority vote. That makes it possible for national Ministers to be outvoted, and the powers of national parliamentarians in holding them to account can be limited as a consequence. That is one of several ways in which the European Parliament plays a key role as a further democratic check.

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However, there are problems. The electorate needs to understand what the European Parliament does. I agree with my hon. Friend that we need more openness in co-decision, for example, rather than letting the European Parliament have more powers for the sake of it, as he put it. However, I also agree with him that the European Parliament has an important role to play, one of which is summoning Commissioners and questioning them closely about the implementation of the work programme and the use of budgets. We need to find better ways of explaining to the public how that is done.

I do not agree that giving the European Parliament the right to elect the Commission's President would enhance the legitimacy of either institution. The proposals misunderstand the nature of the Commission as an honest and independent broker between different interests. An election of that kind would place the President at the mercy of the largest political group in the Parliament. It is precisely the Commission's independence from day-to-day political interference that is its strength. Holding to account through regular and detailed scrutiny, yes; election, no.

The hon. Member for Tweeddale, Ettrick and Lauderdale raised interesting ideas about the European constitution. We are open to the idea of a European constitution, which would simplify the structure and establish clarity. There are serious problems associated with incorporating the charter into the treaties wholesale. It is a "motherhood and apple pie" charter, and we must be careful not to undermine our democratic decision-making procedures.

I would be happy to consider scrutiny prior to Councils. However, that would mean that we would have to meet on a Friday, and I do not think that hon. Members would want to do that—

Mr. Alan Hurst (in the Chair): Order. We now come to our next debate, which is on royal finances.

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