Examination of Witness (Questions 80-91)|
WEDNESDAY 28 NOVEMBER 2001
80. May I put another alternative to you, which
I know has already been rejected by the Foreign Office in the
past and that is doing what the French do with their former colonies
and what the Spanish do with Teneriffe and Ceuta and Melilla and
that is to make Gibraltar part of mainland Britain with its own
Member of Parliament here, with all the laws we enjoy here being
extended to Gibraltar, in other words making it exactly the same
as mainland Great Britain?
(Mr Hain) The difference between Ceuta,
for example, which was passed formally to Spain under the Treaty
of Lisbon in 1688, and Gibraltar which was a subject of a Treaty
of Utrecht in 1713 is that in that Treaty it was jointly agreed
between Spain and Britain that sovereignty would be vested with
Britain unless Britain relinquished that fully, in which case
Spain would have first refusal on it. That is what the difference
is. That is one of the reasons why we are grappling with an entirely
different situation. I can say as a matter of policy in addition,
even if that were not the case, that it is not this Government's
policy to integrate Gibraltar with the rest of the United Kingdom.
It is not and nor will it be.
81. Why not?
(Mr Hain) For the Treaty reasons I have
given, that is not possible. Secondly, in modern Europe, to have
a territory off the Spanish mainland, indeed linked to the Spanish
mainland, some 1,800 miles from Britain somehow integrated into
mainland Britain is not what the modern Europe is about. The modern
Europe and Gibraltar's place in it could be about an open border,
people going freely across that border, Gibraltar's businesses
probably being the financial hub of the entire region, prospering
in the entire region, Schengen arrangements, Common Customs Union
arrangements and all the rest of it. Modern Europe and certainly
this British Government are not about seeking to bring a territory
into the United Kingdom's ambit. That is not really where we are
and I am really surprised that this is suggested.
82. I am taken with this idea of comparison
with Northern Ireland and the peace process and the run-up to
the Good Friday agreement. It does strike me though that one of
the differences is that no matter how unreasonable the different
factions were in Northern Ireland they did all participate in
the process. It seems to me that the Government of Gibraltar is
being intransigent in not participating in the Brussels process,
not exercising its voice. We have heard from the Chief Minister
that he thinks they would be better of being represented by an
empty chair. Do you think that is in Gibraltar's interests?
(Mr Hain) I do not; I really do not.
Those discussions would be enormously enhanced in their quality
and in their credibility if the voice of Gibraltar were heard
at them. We could have a better outcome, we could have better
quality discussion on a lot of the detail. It stands to reason
that the elected representative of the people of Gibraltar is
better able to express the voice of Gibraltar than a British Minister
or a Spanish Minister. As you suggest, the comparison with Northern
Ireland is instructive in that we have the same experience of
Unionists refusing to talk to Nationalists, the same bitter enmity
between those different groups as you now find between Gibraltarians
and the Spanish, politically at least. We overcame it in that
respect and we could overcome it in this respect as well with
a bit of flexibility, a bit of modern thinking instead of sticking
to past positions which get the people of Gibraltar nowhere very
83. I certainly agree with the assertion that
the status quo is not really sustainable in the long term.
I also strongly believe that the status quo is not in the
UK's interests. I really do not think it is in Gibraltar's interests.
Presumably what is on offer here through the talks is a much more
stable and secure future for Gibraltar than we have seen over
the last ten years.
(Mr Hain) I absolutely agree with that.
The prize for Gibraltar is the sovereignty issue no longer impeding
the proper development of Gibraltar economically, socially, in
terms of human rights, democratically and in every other way.
The prize is good relations with Spain. The prize is access to
the Spanish market, to the European market as a whole. The prize
is the European Union's institutions supporting Gibraltar instead
of Gibraltar seen as being caught in a dispute which stopped progress
on matters like air safety and so on. That is a fantastic prize
and it ought to be seized.
84. A final question on a separate issue and
that is tax. Last year OECD named Gibraltar as one of 35 tax havens
which need to improve transparency with overseas investigators.
We are aware of the longstanding allegations from the Government
of Spain that Gibraltar engages in economic and fiscal dumping.
I just wanted to know whether the UK can do something about that
and if it can, will it?
(Mr Hain) Gibraltar is involved in court
action against the Commission, the Court of First Instance, at
the present time as a result of actions which have been brought
by the Commission for harmful state aids. This is another instance
where if we had been able to negotiate a different situation and
Gibraltarian compatibility and with EU codes in respect to taxation
and other matters, then we could have got a lot more assistance
from the European Union and from the European Commission for Gibraltar,
instead of the Commission feeling it was obliged to take action
for what it regards as unfair tax practices and harmful state
aids. Yes, that prospect could be a great prize for Gibraltar
85. In your opening remark you made the historic
reference, that we are dealing here with an historic problem which
has its roots 300 years ago. It is also becoming quite clear to
many of us that there are very entrenched positions on both sides,
some justifiable, some unjustifiable. You also made reference
to possibly needing some kind of new thinking. May I fly a kite
with you? If Spain is in some areas as intransigent as it seems
to be, like not producing evidence on smuggling, what would you
say to a suggestion that we say to them that there are some comparisons
to be made between the position of Gibraltar and Britain and to
some of the territories in Morocco, despite the fact there are
historic differences? Why do Spain, Morocco, Britain and Gibraltar
not sit round the table and talk about territories as a way of
breaking the deadlock?
(Mr Hain) I have enough problems on my
86. It would make it very easy.
(Mr Hain) Gibraltar, issues in Europe,
Afghanistan, sanctions busting in Angola and Sierra Leone let
alone dealing with the problem of Ceuta. I will not take that
on board frankly. I am not seeking to defend the situation either.
I am seeking to modernise the whole of the world frankly, which
is a longstanding ambition of mine which I am sure will have the
unanimous backing of the Committee. On the narrow issue of smuggling,
if I may be so bold as to suggest it, I think there might be a
case for inviting my Spanish counterpart and hearing his argument
on all these matters. Perhaps it would improve understanding on
it. Yes, there are bitterly entrenched positions, a lot of them
totally unjustifiable, but it is the job of Government and the
duty of a responsible Minister to seek to overcome them. I do
not need this. The Foreign Secretary does not need this. We could
continue with the status quo, continue getting weekly phonecalls
from Gibraltar about this complaint or that complaint, continue
to be appalled about border delays, continue to be irritated by
EU business being hampered by the dispute between us and Spain.
The duty of this Government is to try to resolve it. That is what
we are honestly trying to do. If we are unable to do it, at least
we shall have tried.
Sir John Stanley
87. On more than one occasion you have asserted
that the status quo is not sustainable. Why do you believe
that is the case?
(Mr Hain) For reasons I have given, because
of the aggravation facing Gibraltar, because of the stance of
the European Union which wants to see the interests of all Europe's
citizens on matters like air safety, including flights to Gibraltar
enhanced, our safety and security enhanced, matters like this.
All sorts of issues are actually impeded by the dispute which
continues to exist between London and Madrid over Gibraltar and
including Gibraltar. We ought to try to resolve this triangular
dispute. It is not sustainable, it is not sustainable at all.
If we walked away from our duties here, life would become worse
for the people of Gibraltar. It would not become better. We are
trying to make it better. I cannot for the life of me understand
why we are criticised for trying to give the people of Gibraltar
a better life.
88. May I put to you another view for your response?
The present situation has been sustained over a long period. The
reason why the aggravation to which you referred continues is
because this present Government, any more than the previous Conservative
Government, is not prepared to stand up straight and to use its
legal powers which it has as a member of the European Union to
enforce compliance by the Spanish Government with its legal obligations
towards Gibraltar in relation to free movement of people, free
movement of goods and the economic union. Is it not about time
that this Government, as the previous Government in my view should
have done, takes its position that it is not prepared to tolerate
another Member State of the European Union engaging in economic
sanctions against a British dependency?
(Mr Hain) First of all, I find the sanctions,
as you describe themyour words, not mineas being
just as objectionable as you do. Why have successive governments
not done that, including your own? Why have we not done that?
If it were so easy, we could just have gone to the courts. It's
not so easy. Take the question of telephones, for example. The
Chief Minister asserted that this could be resolved by court action.
I am not sure that it could. Gibraltar does not put VAT on its
telephones. The Spanish continuously complain that if they ceded
all of Gibraltar's rights over telephonesand we put Gibraltar's
case very strongly directly over the negotiating tablein
effect they would be setting up a telephone tax haven as it were
to take over and compete unfairly with their own telephone operators.
There are all sorts of issues like that which are not as simple
as they sound and not capable necessarily of being resolved by
court action. There is an additional argument here, which is that
these things are not best sorted out by lawyers, with all due
respect to lawyers, and my own boss is a lawyer, as is the Chief
Minister, as is the Chairman, so I am treading on difficult ground
here. I do not think they are best sorted out by lawyers or judges
in courts. They are best sorted out by political discussion and
negotiation and agreement. You are dealing with historically fiercely
entrenched views, like you were in Northern Ireland and you solve
them by talking.
89. You have made a lot of parallels with Northern
Ireland and we are all wise in this business to be fairly distrustful
of parallels because every situation is different, but as you
put one parallel on the table, may I offer another one for consideration?
The Falklands. We have probably the best relations with Argentina
in relation to the Falklands now because following the failure
of the previous Government's diplomatic policy towards the Falklands
we proceeded with Argentina on the basis that sovereignty was
off the table and that we would talk about anything with Argentina
but we would not talk about the sovereignty of the Falklands.
May I ask you, before deciding to go down the present path, whether
the Government gave serious consideration to saying that the Brussels
process initiated by the previous Conservative Government was
fundamentally misconceived and we should proceed in our dialogue
with Spain on the clear understanding that sovereignty is off
(Mr Hain) One of the many differences
involved, apart from the fact that the Argentinians actually invaded
the Falklands, one of the very many differences involved, is that
Gibraltar and Britain and Spain are part of the European Union
and that imposes quite different obligations on us all, a quite
different approach to life and even the Conservative Government,
our predecessors, even the Chief Minister, as he told you only
a little while ago and as he has consistently said publicly, agree
that sovereignty will be on the table. I do not think anybody
disputes that. Spain would not come to the discussions unless
it could at least raise its sovereignty issues. May I just clarify
one other benefit of the Brussels process, since I am reminded
of it. The reason that the Chief Minister was able to meet Carlos
Bastarreche the very senior official in the Spanish Foreign Office
was because I set it up as a result of the Brussels process meetings.
I said I thought it was important for them to talk to each other.
That meeting followed directly. I phoned the Chief Minister and
I phoned Carlos Bastarreche and I got them talking to each other.
That meeting was a very productive one. It lasted many hours.
There was no agreement, but you would not expect there to be.
It started dialogue. The next stage of that dialogue could be
another meeting with him or it could be a meeting at a higher
ministerial level; another product, another win for Gibraltar
out of the Brussels process. Dialogue wins over a war of words
or over all the other aggressive actions we have seen in this
90. In our sixth report in the session 2000-2001
we urged the Government to rebut, refute inaccuracies of fact
in relation to Gibraltar put forward by the Spanish Government.
We know a number of those have related to smuggling, you have
received no evidence; we know a number of those relate to financial
controls. Can you give examples as this Committee sought, where
the Government has stood up for Gibraltar and refuted inaccurate
statements made by the Spanish Government?
(Mr Hain) I did so only in the House
on 7 November when I complained about border delays and about
the denial of telephone access. I have done so publicly in Gibraltar.
91. And smuggling?
(Mr Hain) We had a very intense conversation
with the Spanish about smuggling and we have said we object to
the imposition of border controls as a result of allegations they
make about smuggling. They come back to us equally fiercely and
we shall continue to put that argument. I have seen no evidence
Chairman: We have had two robust statements
today. We thank you very much indeed for clarifying the position.