TUESDAY 10 DECEMBER 2002

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Members present:

Donald Anderson, in the Chair
Sir Patrick Cormack
Mr Eric Illsley
Andrew Mackinlay
Mr Bill Olner
Mr Greg Pope
Sir John Stanley

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Memorandum submitted by the Secretary of State for Foreign

andCommonwealth Affairs

Examination of Witnesses

MR DENIS MacSHANE, MP, Minister for Europe, MR PETER RICKETTS, Political Director, and MR SIMON FEATHERSTONE, Head, European Union Department (External), Foreign and Commonwealth Office, examined.

Chairman: Minister, may I welcome you to the Committee. I welcome with you Mr Peter Ricketts, the political director of the Foreign Office, and Mr Simon Featherstone, the head of the European Union Department (External). You and I assumed that the meeting would be with the Foreign Secretary. He telephoned me from the middle of his meeting at 2.30 to say that it was lasting longer than he expected. We are delighted that you are able to be with us in his stead. I think this is the first meeting that you have come to as Minister for Europe, for which we congratulate you, at a very dramatic time when the landscape of Europe, both in terms of its security structures and its political structures with enlargement, is now being altered, so a major agenda. We will have the debate in the chamber tomorrow and the Copenhagen Council with the decisions being made on Thursday and Friday. First, because of the importance of Iraq, I would like to turn to that and ask Sir Patrick Cormack to open the batting.

Sir Patrick Cormack

I endorse the Chairman's welcome, Minister. I assume that Iraq will feature prominently on the agenda next week. Perhaps you would like to say a word or two about how the coordination of the European response is progressing. We have had a recent statement from Mr Chris Patten to the effect that the European nations should work together to back the United States if Saddam Hussein fails to comply with the United Nations resolution. Do you think we are close to getting that sort of unity? Would you like to expand a little on that?

(Mr MacShane) Yes. Thank you very much for your kind words. I am sorry that the organ grinder is not here and you have to put up with me. On Iraq, it will be discussed by foreign ministers over dinner on Thursday night. They will be looking at the latest developments, particularly the Iraqi declaration about its weapons of mass destruction programmes and the enormous number of documents that was submitted to the UN. The European Union now has a clear objective towards Iraq and it is very much the same as this government's, namely the disarmament of Iraq's weapons of mass destruction in accordance with UN Security Council resolutions. The EU has always supported the Security Council's efforts to resolve the crisis and I think we are getting individual statements by key EU leaders to make very clear to Saddam Hussein that he must enter into full compliance with not just resolution 1441 but all the other UN resolutions which he has been flouting in the last ten years.

We have this vast dossier of almost 12,000 pages. What will the European Union in general and Britain and France, being members of the Security Council, in particular, be doing to ensure that there is proper cooperation and coordination between those who have to assess this vast document and those who are on the ground conducting the inspections?

(Mr MacShane) Clearly, a principal role falls to the two permanent members of the Security Council from Europe, namely the United Kingdom and France. We need now to examine carefully this document which, as we all know, is nearly 12,000 pages long. We are waiting to see what Mr Vlix says. We come back again and again, as my colleague the Parliamentary Under-Secretary made clear in Foreign Office questions this afternoon, to the need to ensure Saddam Hussein's full compliance -- that is to say, the declaration and the disarmament of his weapons of mass destruction.

I accept all that but what I am saying is what steps are being taken to ensure that there is proper cooperation and communication between those who are charged with analysing this vast document and those who are charged with the inspections on the ground, because there must obviously be a clear link between the two?

(Mr MacShane) The document presented by Iraq is now being analysed and the inspectors on the ground have to report within 60 days after they began -- that is to say, on 27 January. I am not aware of specific linkages as such. Clearly, information coming from the Iraqi declarations, I assume, will be e-mailed, telephoned, satellite phoned to the inspection team on the ground so it can help them as they search for all the evidence that is needed.

(Mr Ricketts) This is one part of the material available to the inspectors on which they will base their inspections. I am sure Member States as well as the experts in the IAA will pool their assessment of the Iraqi declaration. There will be further meetings of the Security Council, I would expect, before Christmas to take stock of what the initial analysis points to and this will be one element in the ongoing inspection process that is now set to intensify.

Are you confident that we will at Copenhagen come close to a true European unity of position on the resolution and on Iraq?

(Mr MacShane) On resolution 1441, all members of the Security Council have endorsed it, including the European ones. The President of the UN General Assembly, formerly the Foreign Minister of the Czech Republic, and I have certainly been struck on the visits I have made to the applicant countries since taking up my post by their firm view that the United States is a partner and ally of the European Union and should be backed in key strategic decisions such as one over Iraq. I do not foresee a specific resolution, though this will not be formulated until the dinner itself, that will take us beyond where we are in terms of resolution 1441 because the story is unfolding and it will not come to a final point, I would have thought, by the end of this week.

One must look at this in the whole context of the Middle East. Do you think we can look to Copenhagen for any European initiative on perhaps a Middle East peace conference?

(Mr MacShane) Yes, we will have a declaration on the Middle East based on the road map drawn up by the so-called quartet. As you know, the Prime Minister continues to work for a Middle East peace conference and we still have the strong commitment to the two states of the Middle East as laid down by President Bush. I think there will be a clear signal from Copenhagen that we expect the sides there to start negotiating and stop using the violence currently being deployed.

Sir John Stanley

At Foreign Office questions this afternoon, your ministerial colleague at the Foreign Office, the Parliamentary Secretary, Mike O'Brien, reiterated the British Government's view as to the interpretation of Security Council resolution 1441 in the event of there being a material breach of that resolution by Iraq. He said to the House that the British Government's view was that it was simply the preferred option of the British Government that, in those circumstances, there should be a return to the Security Council for a substantive, new resolution. Do you agree that the British Government's view on this point is one which is not shared by many, possibly if any, of our other European partners, certainly the majority of whom take the view that the obligations under Security Council resolution 1441 and other related resolutions are that, in the event of a material breach, there is a requirement to return to the Security Council for a further substantive resolution before any engagement is made in military action?

(Mr MacShane) That was very much the position ahead of the adoption of resolution 1441, when a number of countries insisted always on a formal two resolution approach to the process. One of the achievements of good diplomatic work, if I may call it that, in New York was to draft a resolution that bridged those two positions and brought on board countries, for example, like Syria. I am reluctant to speculate because it always struck me in the discussions before 1441 that there was one gentleman listening very eagerly to divisions and lack of clarity and certainty on the part of the western democracies in particular and, as my colleague, the Parliamentary Under-Secretary, made very, very clear, our view is that 1441 does offer what the Foreign Secretary has called a peaceful pathway to resolve the crisis. It is up to Saddam to take it. If he does not, he will face the serious consequences foreseen in the resolution. At the end of the day, I can only speak for Her Majesty's Government, but I am fairly convinced that most of the prime ministers and leaders of governments attending the European Council in Copenhagen, both the existing and candidate members of the European Union, will want to see this matter resolved very clearly indeed.

We accept that you can only speak for the British Government but you are, like us, listening to what other governments are saying and, as are the members of this committee, you are wholly aware that since the agreement of Security Council resolution 1441 the French government has made it very clear, to its own domestic audience and more widely, that in their view there is a clear requirement to return to the Security Council for a further substantive resolution. Given that that is the French position, which appears to be quite widely shared amongst other EU Member States, can you tell us how the British Government is going to try to bridge what appears to be a fundamental difference of view as to whether or not a second substantive resolution would be required between the EU Member States, this of course being a very, very substantive issue on which it is of the utmost importance to try to show a united front to Saddam Hussein?

(Mr MacShane) Resolution 1441 does mandate the Security Council to discuss any material breach, if one gets that far. It comes back to the Security Council in any case. It is then up to any member of the Security Council to make its position known. I am not sure I can go all the way with you in saying that all or the majority of EU Member States have made unqualified declarations that they expect a full, second declaration before there could be any next stage of resolving the Iraqi crisis. I heard President Chirac, at a press conference after the Paris two conference in Paris to raise money for the Lebanon which I attended, say that he certainly thought the Security Council would have to look at this again. I was listening to him in French and did not take a note. I was not quite sure he in terms said there had to be a second resolution. What is important is that the Iraqis have complied with allowing weapons inspectors back. They have made this enormous declaration of 12,000 pages. Inspectors are on the ground. The pressure is building up. The heat is on. I think Europe, the United States and the rest of the democratic world expect Saddam to comply fully with the wishes not just of this resolution but of the other ones which he has been violating in recent years.

Can you assure the Committee or not that the British Government at the Copenhagen Council will be doing all it possibly can to produce agreed wording in the final communique in which all EU Member States do sign up to wording which does hopefully reconcile this potentially serious divergence of view, so that the EU does produce a united front on this key point?

(Mr MacShane) I am sure the EU will provide a united front. I am not entirely convinced, with respect, that as of today this is the issue. It certainly was before the adoption of 1441. I do not disagree with you in any way on that. I have had a number of conversations with foreign ministers and some government leaders since my appointment. While none wishes for more, all know that Saddam cannot be allowed to get away with it again. I think there will be a very strong message from Copenhagen to Saddam that he has to enter into full compliance both with this and previous resolutions of the United Nations and I have no doubt we will argue that case very strongly over dinner bilaterally for the strongest and most united language. I do not want to tempt fate to say where we might be on whether or not a second UN Security Council resolution is demanded by some countries in the Security Council or not at some future stage.

Mr Illsley

Can I apologise for having to leave the meeting early? Is there any prospect of any agreement between Greece and Turkey in relation to Cyprus? Can you reiterate the British Government's position with regard to the accession of Cyprus? Does that position remain the same, that no other country will have a veto on their accession? Are you confident that their invitation to join the EU will be made at Copenhagen?

(Mr MacShane) I can say yes to all three points. It is not so much that Greece and Turkey have to come to an agreement but that the UN plan put forward by Kofi Annan, who will be coming to Copenhagen to try to ensure that it is finally agreed there, is supported by the Greek government, is supported by the Greek Cypriot government and is supported by Mr Urluwan and the new AKP government in Turkey. This does present us with an historic possibility at Copenhagen. There are bits and pieces that have to be tied up and that is allowed for in the Kofi Annal proposals but at Copenhagen we could be going into the end of the Council with the Annan peace plan accepted, providing for a united island of Cyprus in international terms with clear limitations on how the two communities control their own affairs, with Cyprus accepted into the European Union and in any case Cyprus will enter the European Union, if it so chooses to do and meets all the criteria and agrees the final negotiating position, at Copenhagen. It may enter in a very different way from what we were looking at a year or two ago. That is a wonderful moment of peace that is on the horizon for the eastern Mediterranean.

Chairman

We are currently a guarantor power from 1960. We have always had a very close interest in the future of the island. What residual role would be left for the United Kingdom if the Annan proposals go through?

(Mr MacShane) We remain a guarantor power and that is the wish of both communities on the island and the wish of Greece and Turkey. The sovereign base areas are not part of the Republic of Cyprus and therefore all European Union treaties make clear that they are currently outside the European Union. We are committed to the undertakings set out in the Treaty of Establishment and Britain has played a behind the scenes role, but a very useful role, with our experience in trying to bridge the many, very wide gaps that exist in the different positions on resolving the Cypriot problem.

They are within the EU because they are a sovereign UK territory.

(Mr Featherstone) Under the Treaty, they are formally excluded from being part of the EU, even though they are a dependent territory of the UK.

Mr Pope

Could I move to Turkey's chances of being given an accession date at Copenhagen? It struck me that since the recent elections the government of Turkey has played a positive role in regard to Cyprus. We know that Turkey's application has the support of the United States Government. What do you think are the chances of them being given an accession date this week, or is it more likely, as some press reports have suggested, that they will be given a rendezvous date in the future at which they may be given an accession date?

(Mr MacShane) I hope very much that out of the Copenhagen Council will come a firm and proximate date to begin negotiations with Turkey on accession to the EU. Mr Urluwan in his visits to western Europe has made very clear that such discussions will be long and arduous. We are talking about a decade or more before any conceivable entry of Turkey into the EU. Britain has taken a lead in this and not just, as much of the press have reported, out of a geostrategic interest because Turkey obviously is a very important nation, but also because the Turks, who seek modernisation, who support democracy and human rights, are all looking to the EU for encouragement. Also, because the prize of having an Islamic or Moslem democracy operating internationally, abiding by European values, is an enormous prize. We as a government have made very clear and I have made very clear in all my conversations with EU partners that Britain wants the strongest possible message sent from Copenhagen to the Turks.

I am very pleased to hear that and I welcome the British Government's view that Turkey will be a big asset to the European Union. It will send a very clear message for a Moslem state coming in that it is not just a Christian club. Could I ask that we maintain a high profile and robust position on the Turkish human rights record? I accept that its human rights record has improved. The situation is vastly different to what it was, say, ten years ago, but I think it still has quite a long way to go and there is a role there for countries like the UK, which are friends of Turkey and want to see Turkey in the EU, to be a friend who will be honest with Turkey and say that their human rights record has quite a bit further to go.

(Mr MacShane) You are absolutely right. If we look at what has happened in the mainland east European and central European countries now seeking to join the EU, some of which had some barely acceptable stories about treatment of minorities in particular ten years ago, coming toward the EU has obliged them to lift their game and abide by democratic norms. I will continue, as will other ministers, to press publicly Turkey to come to the EU norms on human rights. We have just had a marvellous human rights open day across the road in the Foreign Office. Last year, we spent £1.6 million promoting human rights through NGOs and Turkish authorities. PEN, for example, the writers' organisation, was supported by the Foreign Office to send observers to trials of writers who should not even be on trial, let alone in prison. The Foreign Office's record, our ambassador's record and I hope our minister's record is absolutely first rate. We have a human rights dialogue with the Turkish government, the second one of which took place in November. Clearly, as I hope they in Copenhagen get a clear road map towards the European Union, human rights will be firmly on the agenda.

(Mr Ricketts) Having been with the Foreign Secretary in Ankara a week ago, it was very striking the pace of change in terms of the reform programme going on in Turkey at the moment. They adopted one large package of constitutional changes in August. There was a further package of 31 measures put to Parliament the day the Foreign Secretary was there on 3 December, which they aim to agree before Copenhagen, and then there was a third package including a number of important measures which they are about to put to their parliament. As part of that, their commitment to the final eradication of all torture was made absolutely explicit. There is more to do but there is quite a pace of activity under way now with the new government.

That is a really helpful reply, certainly for people like myself who have been a long term critic of Turkey's human rights record, to be able to recognise that quite rapid changes have been made recently. It seems Turkey has convinced the UK government but it clearly has a way to go to convince some of our partners. Austria and France are at best sceptical and at worst hostile to Turkey's application. A number of other countries -- Ireland, Sweden, Finland, Luxembourg -- are not committed. Giscard D'Estang said it would be the end of the European Union if Turkey was admitted. What chance have we of persuading some of those other countries that are very sceptical that Turkey will be an asset to the European Union?

(Mr MacShane) I think one should be careful about generalising about countries. There are political forces within countries which have different views towards Turkey. I notice, for example, that Mr Steuber, the Conservative leader in Germany, said that he would oppose Turkish admission to the European Union, whereas the German Chancellor and Mr Fischler have come down clearly in favour. I also notice that President Chirac said that he believes Turkey's future place is within the European Union even if, according to today's Figaro, his own party is narrowly hostile to it according to an opinion poll. There are some voices I have heard in the French media representing political groupings in France which, as you rightly say, are extremely hostile. I also heard the same remarks over the last ten years about some of the countries that are about to enter into the European Union, so I hope we will educate and persuade. I hope Turkey will show by dint of modernisation and increased democratisation that it is a worthy candidate to enter the EU.

Mr Olner

I apologise because I need to leave quickly as well. Given that the media attention now seems to be more concerned about people buying flats in Bristol and the possible war on Iraq, could we turn to Zimbabwe and ask whether you think the EU's current policy on Zimbabwe is producing any tangible results?

(Mr MacShane) I think it is part of the process of pressure on the Mugabe regime which he has reacted against very strongly. It sends a clear signal elsewhere in the world, including of course Mr Mugabe's neighbours, that the European Union finds that the way he has been conducting himself is unacceptable. We have to maintain that pressure on the Mugabe regime. The European Union's contribution is an important part of maintaining that pressure.

Given that Mr Mugabe and his regime are fairly resilient to dodging sanctions that are put in his way, are you happy that the Mugabe regime is not using international conferences and the like to dodge the travel ban that has been put on him and his regime?

(Mr MacShane) There are international treaty obligations that oblige every country where there are certain types of conferences, normally those associated with the United Nations or its agencies, to accept any head of state or properly delegated member of government to be free and able to attend. I do not think all American politicians, for example, are always happy to see Mr Castro doing his press conferences in New York but he had that full right because Cuba was a member of the UN and we cannot remove that right, as we are bound by treaty, from Mr Mugabe. On the other hand, I have certainly heard anecdotal evidence from friends connected with Zimbabwe that the publicity in refusing him or his ministers permission to travel has given heart to those struggling for democratic change and has been found very embarrassing by Mr Mugabe and some of his close associates. It is one form of pressure. It is not a magic key that converts Zimbabwe into what we would wish it to be, a functioning, democratic state in which all its people can live at peace.

Your department will have seen some evidence, particularly from people in Matabele Land, that Mugabe and his regime are using food distribution as a way of silencing his opponents. This has rather gone off the front page of most of the papers at the moment. Can I ask how often you revisit how best we can help the oppressed minorities within Zimbabwe?

(Mr MacShane) Zimbabwe occupies a very significant place in Foreign Office and government thinking. You are right; one is always concerned to read newspaper reports of food aid not getting to where its donors want it to go. Dr Speake on behalf of DFID and the British Government try to ensure that any aid goes to reputable NGOs and charities that can distribute the food without there being a political influence in that food distribution.

(Mr Ricketts) The Foreign Secretary raised this very subject again with the EU foreign ministers last night at the General Affairs Council in Brussels and quoted to them the words of the executive director of the World Food Programme, that Mugabe's policies have turned what was a problem as a result of natural causes into a humanitarian catastrophe. We are keeping EU foreign ministers very fully briefed on what is going on there.

Sir Patrick Cormack

Could I express the hope that the evidence to which Mr Olner referred and which this Committee submitted in turn to the Foreign Secretary is shared with foreign ministers of the European Union because, although I would not for a moment doubt the integrity of your intentions or of her Majesty's Government's, there is a feeling particularly among the oppressed people of Zimbabwe that they have slipped on the world's agenda and that their concerns and their terrible privations are not being addressed with sufficient urgency. The dossier to which Mr Olner refers not only gives details of the deprivation of food aid but of the forced sterilisation of Matabele women, of intimidation on an horrific scale and the people who came to give us evidence were so much in fear of their lives that we could not publish their names. This is a despicable regime. Can you say anything to indicate that it will be fairly high on the agenda of our European friends in coming days?

(Mr MacShane) I completely agree with you. I would like nothing more than to see the front pages of our popular papers and broadsheets emptied of the current absolute trivial nonsense that they are printing page after page of, to be replaced with serious matters of world concern, including the situation in Zimbabwe. I would have been delighted if in Foreign Office questions that we have just had there had been a question tabled by any honourable member on Zimbabwe to highlight the issue. I am always very pleased when there are adjournment debates either in Westminster Hall or at the end of business that allow these questions to be raised. I can give witness, both in my present and previous posts, that in all the meetings that I have attended with ministers since June 2001 Zimbabwe has been regularly not just on the agenda but very often dominating the agenda of what we are seeking to achieve.

Could you give an undertaking to this Committee that you will try and ensure that the evidence to which I referred, which this Committee submitted to the Foreign Secretary, is shared with his colleagues in the European Union?

(Mr MacShane) I am very happy to do that and give an undertaking. I think it might be more appropriate for my colleague, the minister responsible for Africa, Baroness Amos, to write to her opposite numbers and appropriate ministers in the EU with these points. I do assure you she regularly raises these concerns at meetings both in Europe and in Africa with her colleagues from Europe as well as her African opposite numbers.

Chairman

It is important for us to give a very firm example to our EU colleagues in terms of contacts with Zimbabwe. What is the government's view in terms of the English cricket team's visit?

(Mr MacShane) I remember hearing in days long ago -- and perhaps my predecessor as Minister for Europe would be a more appropriate person to reply to that question -- about politics and sport not being mixed up. I hope that the England cricket team, keen as it must be to search for victories, takes cognisance of the fact that if it goes to Zimbabwe it will do so in very odd, peculiar circumstances that may not redound to its credit; but I am not yet ready, as an old-fashioned libertarian, to call for a specific ban.

Sir John Stanley

The comforting words you offered to Sir Patrick a moment ago, suggesting that the British Government wanted to see Zimbabwe on the front pages of the newspapers in European capitals, do seem to be somewhat at variance with the memorandum which you have submitted to this Committee for this evidence session. Forgive me if I have missed it somewhere but on going through it there appears to be no reference whatsoever in your memorandum headed, "Prospects for the European Council, Copenhagen", to Zimbabwe at any point. Are we therefore, as a Committee, entitled to conclude that, contrary to what you said, the British Government's position is it is not going to raise Zimbabwe at the Council? If that is not the case, perhaps you can explain why there is no reference to Zimbabwe in the memorandum. If it is going to be raised could you tell us what the British Government is going to propose to the other European premieres?

(Mr MacShane) It was raised last night at dinner and, at the last Brussels General Affairs and External Relations Council that I attended, there was discussion on Zimbabwe. You are also right to say it is not formally on the agenda and there was a colleague in the House this afternoon from the Scottish Nationalist Party who asked me why his particular problem, which I fully accept he is very concerned about, is not on the agenda. The Council cannot deal with every single issue every single time. Zimbabwe is much discussed, to use the jargon, in the margins because we press the government as ministers constantly to maintain the strongest, firmest stand on the Zimbabwe issue. You are right also to note that when things are on the front page of the national and international media it is a lot easier to get a political head of steam behind them. When they are not, people move on to the next big story or issue but I can assure the Committee that, in as much as I will be having talks with my opposite numbers, the European ministers at Copenhagen, I will continue to press the case for a very strong line on Zimbabwe.

Chairman

I would like to turn to enlargement. Our Danish friends are justly very proud that the process began at the Copenhagen Council in 1993 and hopefully will be concluded satisfactorily at Copenhagen this month, 2002. Are you able to give us some hot news from the front? What, if anything, is happening now? Have any decisions been made in closing the chapters or are discussions still continuing?

(Mr MacShane) The latest reports I had were that discussions continue but in a good spirit. People still want to take these issues to the table at Copenhagen itself, some in the hope of one last extra bit of benefit in terms of the terms under which they will accede to the European Union, others I think reasonably in the hope that even in the last 24, 36 or 48 hours some people might change part of their mind and be more generous. It is the normal negotiating thing. My firm impression from the talks I have had with at least six of the applicant countries I have been able to visit since becoming Europe Minister was that people also saw the larger picture and the need that Copenhagen will be a moment of celebration and a coming together of the European Union.

The applicant countries may see the larger picture but they are concerned that perhaps the existing EU nations may not see that larger picture. You will recall the letter in today's Financial Times from the prime ministers of Hungary, Poland, Slovakia and the Czech Republic, effectively saying that there was a real danger that they would reach a cash flow crisis as they would be expected to pay without the speed of receipts from the EU and asking that this be seen as a key point of history. Do you share the apprehensions of those prime ministers?

(Mr MacShane) I read the excellent essay in The Financial Times which placed the accession in the much bigger picture of European history. It talked of an historical moment that never comes twice in the lifetime of a couple of generations of political leaders of each nation. I have heard these points made in my own discussions with Poles, Czechs, Slovakians, Hungarians and others. The European Union was right to announce a package of a total amount of money and leave it up to the Danish Council team -- and I pay tribute to the extraordinary professionalism with which they have handled these very complex, technical, end game negotiations -- to come to final deals. I do not have the impression, looking at the budget positions of some of the major contributors to the European Union, principally that of Germany, the largest net contributor, that they feel that they have any extra money to give at this stage. I am also not convinced that an extra per cent here or half a per cent there makes such an overwhelming difference. We have looked to address specific points that are relevant to each nation's agricultural or manufacturing or wine and drinks culture. I am very confident that out of Copenhagen governments will go back pleased with the fact that no one will be other than a net beneficiary as a result of joining the European Union in the first period. An important technical point is that, whereas all of them will be in full receipt of what they would get from the European Union from 1 January 2004, they only have to start paying in from 1 May. This accounting technique means they get yet more money from the EU and pay less in the first year of membership.

The prime ministers were well aware of that when they expressed their apprehension. You know the Polish situation well. There is a possibly unstable coalition. Is there a serious danger that public opinion might be turned against the European Union in a referendum unless the major contributors are prepared to be more generous?

(Mr MacShane) The danger of public opinion in any country being turned against the European Union by demagogues and anti-European charlatans is something that we have to live with in the existing EU Member States. There is a significant amount of money coming from the European Union to each new applicant country. Candidates will receive on average four per cent of their GDP from EU funds in any one year. That, if you think just how much four per cent of GDP would mean in this country, is a very substantial flow of cash in the right direction and I hope that governments will highlight this. Within each country, there are different balances of opinion on the popularity of the EU, different people who seek a political profile by campaigning against it, but all the leaders I have met, including representatives of the four governments whose prime ministers signed today's article in The FT, have made very clear that they are going to go all out to win the support of their people for a yes vote in the accession referendum.

Mr Pope

Could you try and pin down the figure for the amount of euros that are going to be spent to ease the transition of the new members into the EU. Is 5.5 billion euros by 2004 an accurate figure?

(Mr MacShane) We know that the budget for all ten candidates in 2004 to 2006 will be less than one thousandth of the EU's total GDP. The current total GDP of the European Union is 7.8 trillion euros or dollars, since the euro and the dollar are about the same at the moment. If somebody would like to divide a thousand into that, I think it comes to 700 billion. It is a significant transfer west-east. On average, candidates will receive four per cent of their GDP from EU funds in any one year.

The reason I came up with 5.5 billion is that there is about 2.5 billion accounted for in deferring payments from January to May 2004, an increase in aid of two billion and a one-off reimbursement of one billion in 2004 which brings you to 5.5 billion. Do you think that is an appropriate figure or do you think, as some people who are already in the EU have suggested, that it is too generous?

(Mr MacShane) Those who do not want to give think it is too generous. Those who would like more think it is not generous enough. I think it is about right because what has not been put into the equation is the fairly generous, pre-accession amount of money that the EU has given to the candidate countries. It is also right in terms of their capacity to absorb money too, because if one moves straight away to 100 per cent direct payments under CAP not only will that bust the CAP budget wide open, but I very much doubt if any of the applicant countries would be able to handle that amount of money into what is still a not very modernised, reformed, high tech or low employment agricultural sector. These things are a matter of balance. I am confident that we have struck it about right. A point I constantly made in my discussions was that, if the EU's budget did not spend just short of 50 per cent on the Common Agricultural Policy, there is likely to be more money all round; or if the EU with 370 million citizens had the same GDP as the United States with 250 million citizens -- i.e., $10.1 trillion, $2.5 trillion more than the EU -- again, if we have been growing faster, creating jobs in the way that perhaps only this country has shown the way forward on, Europe would be richer and it would be possible to be more generous.

My final point is about Poland. Some people are unhappy with the package on offer. One of the groups of people who are very unhappy are the junior partners in the coalition that makes up the Polish government. Whenever I have spoken to people from Poland, they have expressed real concern and sometimes anger about the agricultural proposals that have been put forward. They feel that they are going to be short changed. Are you concerned, as I am, that first of all this could destabilise the Polish government and secondly it could even threaten a referendum in Poland on accession?

(Mr MacShane) Where one has a large peasant population -- though the definition of the Polish farming community is not like one would see in other countries because there is a large number of people employed in other sectors who produce agricultural products, not on a full time basis -- people look to the EU for a great deal of financial support. If that is not available, they may be discontented. We had 400,000 people marching in the streets of London two months ago, the Countryside Alliance, most of whom, it seemed to me from the balance I saw, wanted more money spent in the agricultural economy; yet we are all agreed on a cross-party basis that the Common Agricultural Policy does not work and needs reform. It will always be a difficult question but I hope the broad interests of the Polish people have to be more satisfied by the fact of enlargement, of free movement of people, of investment, of developing their new, value added industries, encouraging the creativity of their people, allowing them to travel and have two way trade and investment right across this new, 500 million strong market. That I hope will outweigh the fears and misgivings, which I fully understand, of elements of the Polish agricultural economy and peasant community.

Andrew Mackinlay: Can I join in welcoming the new Minister of Europe? He is the sixth Minister of Europe in just over five years, which is a great pity. I wish him a long time in this job, not for him but in the interests of the United Kingdom because I think the Prime Minister has been very fickle on not having a consistent Minister of Europe. I think it is bad form, frankly, and I hope you stay there a very long time.

Chairman: Do you agree with that?

Andrew Mackinlay

It is a very serious point. There are no relationships built and it sends all the wrong signals. Having laboured that point, it struck me that the great danger is that the Iraqis have put what weapons they have, to use a phrase used in Ireland, beyond use. They would have destroyed or dismantled their weapons but that would only be half the requirement of the United Nations because the requirements are that we know exactly what they had, what they procured in the past and where it has gone. Has the British Government anticipated this, because it seems to me that there could be perhaps disagreement between the United States and the United Kingdom which I think has proved to be a very successful scenario. That kind of relationship with firm resolve has brought us to this position where there has been a very false admission made. There will be those in the Defence Department in the United States and probably in the White House who will see a material breach as something relatively small; whereas we and others who have been less resolved than ourselves will consider that this was a major step down by Saddam. I hope I am trying to paint a scenario. The likely thing is not going to be black and white. There is not going to be a blatant material breach by Saddam. Equally, he is probably going to, as a matter of pride, self-esteem, arrogance, call it what you like, have put his weapons beyond use but not given full disclosure. Have we anticipated that kind of scenario? How would we deal with it?

(Mr MacShane) You raise a whole range of issues that are coursing through everybody's minds. I hope the answers will come, both from the analysis of the documents presented and the continuing reports from the inspectors on the ground. There is undoubtedly quite an important role for the inspectors who are in two way communications with the UN to help precisely to try to answer some of the points that you have made. I am not seeking to dodge the question but it is genuinely quite hard to speculate at this stage on where we will be on the Iraq question even in a relatively short time, let alone in the two or three days that remain until the European Council.

Has there been agreement between the President of the United States and our Prime Minister or between the State Department and the Foreign Office that in order that there will not be a public breach there will at least be some joint examination? What I fear is that the United Kingdom's threshold as to what constitutes compliance may be different from the United States. It is not unreasonable to assume that we might have a different assessment. Surely, there ought to be at least a mechanism to discuss that before either side claims?

(Mr MacShane) Mechanisms exist in the sense that there are continual, bilateral contacts between the Foreign Secretary and the Secretary of State, between the Prime Minister and President Bush, as indeed there are between American government officials right up to the highest levels and their opposite numbers elsewhere in Europe. I accept exactly the thrust of your argument but I think we have some time to go yet. I got the impression, listening to President Bush's radio broadcast, that he wanted time to examine these documents. We have the inspectors on the ground who are reporting continually. I would be very happy to come back to the Committee -- I am sure the Foreign Secretary would -- to discuss the next stages of the unfolding Iraq crisis, but as of today all I can say is we have the resolution. That was a good result for diplomacy. Europe and the United States are united through that. I think the European Council will adopt a strong resolution in Copenhagen. Now we must get on with going through in detail the 12,000 pages of documents and encourage the inspectors to maintain as thorough an inspection regime as possible.

Can I move to the European Union and Copenhagen? Romania and Bulgaria: presumably they are coming up at Copenhagen with regard to giving them some targets for accession. Also, a relatively small but nevertheless important issue: the vexed issue of us still requiring of a country which is likely to come to the European Union in a few months' time visas from Slovakia. It seems to me unnecessarily spiteful and rather silly and if it is going to be okay on the night two months down the road why is it not this evening? Why are we insisting upon visas for folk from Slovakia?

(Mr MacShane) On Bulgaria and Romania, we did at the last European Council in Brussels express support for those two countries and their efforts to achieve the objective of membership in 2007. The Prime Minister has also repeated that we believe 2007 is an achievable target date for their accession. I understand again there was discussion in Brussels where the Foreign Secretary has been since yesterday afternoon on this issue. My hope is that at the end of the Council in Copenhagen 2007 Bulgaria and Romania will stay firmly on the agenda. On Slovakia, I was there in Bratislava recently myself and it is undoubtedly an issue. We are keeping it under the closest review -- that is to say, the visa regime. We want to lift as soon as it is no longer needed, but all honourable members of this Committee will be aware from their surgeries of the problem of people who arrive and then claim asylum. Unfortunately, there were some difficulties emerging.

It is what they call a white country now, is it not?

(Mr MacShane) It was to do with transit and some minorities within Slovakia. You are absolutely right: once in the EU, it goes. There is free movement of people.

It is the same humbug. When Mr MacShane was elected to the House of Commons, to the credit of the Major government, he lifted the visas on Poland and there were all the same silly people in the Foreign Office and the Home Office who shouted, "Foul" and unfortunately there was a political decision taken.

(Mr MacShane) The very positive announcement made by the Foreign Secretary today is that Britain is going to extend free movement of people's rights to all EU candidate countries on their accession. I think that puts us in a good club of liberal, open countries that see value in the Poles and the Czechs coming to Britain as soon as they are in the European Union just as our Spanish, Greek and Portuguese friends can do at the moment.

The question of corruption in the EU is coming up. We have some evidence here from the Budapest Open Society Institute but we do not just need it from them. There is a feeling that not only is corruption a problem in some of the applicant states but also in the existing states. There is a feeling that there has been insufficient robust homing down by the existing governments on corruption. Is that coming up at Copenhagen with a view to it being dealt with in a very substantive manner? I realise it is probably always on the agendas but in the United Kingdom in particular where, by and large, we consider ourselves, not in an arrogant way, to be pretty good on minimising corruption, there is a feeling that that is not the norm or pattern in existing arrangements, quite apart from what might exist in applicant countries.

(Mr MacShane) Chairman, I am repeating now an exchange in a debate on Europe earlier last month in which the Hon. Member was listing the cases of fraud and corruption involving the Common Agricultural Policy which are there in the auditors' report. I noted that day that our own National Audit Office have referred to a £150 million VAT fraud which will be tinged with corruption inside the UK. I thought the question of motes and beams might be applied when we get into CAP fraud and corruption. Everybody is concerned about the whole justice rule of law, corruption aspects of some parts of the applicant countries but, again, 15 Members of the European Union might want to look into some of their own corners of behaviour. The UK in particular has sought to provide considerable expert advice to the candidates to do with organised crime, money laundering and strengthening of their police services. We have a very good record in some of these countries, notably Estonia and Slovenia, and we are to help more. I chaired myself ten days ago a big conference of countries from principally South East Europe attended by foreign justice and security interior ministers on how to combat organised crime, people trafficking, money laundering but, again, I do believe that entering the European Union will oblige all those countries to step up their game to improve the quality of their work in this field because the Single Market and the single Community of the European Union cannot work if it is affected by corruption in any area.

The issue, of course, is not so much the scale which exists, it is the determination and having the institutional mechanisms to both find, detect and prosecute which in the United Kingdom we are strong on, even if we find something wrong. Can I move to Cyprus. If there is an agreement based on the plan which the United Nations are pushing at the moment and we are supportive ourselves of two component states, reading the documentation if the two component states exist the franchise for local government and for the component states must exist, must it not, for whoever is residing in the component state regardless if one has citizenship of that component state? There is going to be, I understand, a common citizenship for the union of Cyprus and then you have citizenship of a component state. But under the European Union law a citizen of the European Union can vote in Rotherham Council elections and Thurrock Council elections, so if I am not a citizen of the Turkish zone component state by happening to be Greek I will, will I not, be able to vote in those elections? Discuss.

(Mr MacShane) Certainly the theoretical position is quite clear. All European Union Member State citizens have the right to vote in municipal elections. I do not see why that should alter particularly in the case of Cyprus but we see, for example, in Belgium, where there are two quite distinct Flemish and French speaking communities, really quite separate approaches.

Andrew Mackinlay: It works. You and I are in agreement, Minister, you and I are in agreement, I am talking about whether or not that is in the plan? Has it been thought about otherwise it will be a major departure from what are the existing European Union Treaties, will it not?

Chairman

You can reply in writing, Minister, if you want.

(Mr MacShane) I am always reluctant to set functionaries off on another paper chase so if I can deal with it verbally, Chairman.

Yes.

(Mr MacShane) I am not aware that the Annan plan is in any way going to allow a derogation from European Union norms and practices so, yes, if Cyprus, which is one state, will adhere to the European Union it will have to conform to European practices in terms of electoral law. That requires, also, people taking residence, buying property and the rest of it because much as at times I wish many Europeans would vote in Rotherham, they are not allowed to unless they actually live there.

Andrew Mackinlay: Chairman, other colleagues might want to come in. I want to come in on other things: Macedonia, Kaliningrad, Belarus, Ukraine, there is the question of the collective doctrine of defence, restitution of law and poverty.

Chairman: I will come back to you. I will let other colleagues come in, Sir John and Mr Pope, and then I will come back to you.

Andrew Mackinlay: That is excellent. Can I just say on Poland though, I listened and very much agree with Denis MacShane, it does seem to me the day Poland comes into the European Union that puts to bed the outrage and the war which started for them on 1 September 1939.

Chairman

Minister, you have a special interest in Poland.

(Mr MacShane) I think all Poles have been dreaming of this day for a long, long time.

Sir John Stanley

Minister, as you know, last week the President of the EU Commission, Mr Prodi, made a far reaching speech in which he proposed the abolition of national vetos, possibly in their entirety but over pretty well all the remaining areas where the veto applies, including taxation. Could you now tell the Committee, as far as the British Government is concerned, where the British Government considers currently the subjects are which must be reserved in future for unanimity?

(Mr MacShane) The Prime Minister in a speech in Cardiff on 28 November set out the Government's current position, and I would be happy to circulate that speech for all Members of the Committee. He stressed that we need to move away from a sterile debate between so-called inter-governmentalism and communitisation. In my phrase "Europe is not a zero sum gain" and in his phrase "we need both strong national governments and strong European governance". The issues that we think still are important to remain under the control of unanimous voting remain defence, foreign policy, taxation, social security, and I was very interested to read in the French press yesterday that the French Government was looking to see VAT on its hotels and restaurants reduced to 5.5 per cent which of course is a major shift which would require the support of other countries. It seemed to me reading what the Prime Minister, Monsieur Raffarin, was quoted as saying, that the French understand also that harmonising or having single tax rates across Europe does not make much sense.

To the list you have just given to the Committee, do you add Treaty change?

(Mr MacShane) Of course, and Treaty change, forgive me.

Are there any other items that you wish to add to the list you have given to the Committee already?

(Mr MacShane) I think those are the principal ones. I need to refresh my memory considerably and in a sense all of this evolves over time. It does seem to me that always the only question is would this be in Britain's interest. Now you can have a dogmatic die in a ditch view or you can seek to take the argument forward. I think there are so many different views in Europe that Mr Prodi's speech was quite scathingly dismissed by the President of the Convention, Mr Giscard d'Estaing, according to reports I read in the French press, but each contribution is worthwhile. The French Foreign Minister made an interesting speech in Marseilles on the Convention, the French Prime Minister made an interesting speech in Orleans, the British Prime Minister made an outstandingly interesting speech in Cardiff and these contributions will go on and on as the Convention hots up in its work.

Thank you very much for the helpful and substantive answer you have given. I did not ask the question to you in any way to try and trip you up.

(Mr MacShane) No, no.

I will have to say to you, Minister, that the answer you have given to my question is wholly different from the answer which was given to the same question which I put to the Foreign Secretary when he came before the Committee earlier this year. I am delighted you have now given a substantive list of areas where it remains the British Government's position to preserve unanimity and I just will simply register that the Committee will rest on the answer you gave today as being the latest position of the British Government unless you advise the Committee subsequently that in any way you were mistaken in the answer you have given. Thank you.

(Mr MacShane) Sir John, I am looking quickly through the last Committee evidence minutes to see whether I am out of line with the Foreign Secretary, a position I would not at this stage in my career ever wish to find myself in. That is my understanding of areas where on the whole we think unanimity should be maintained. If that position needs to be altered of course I will write to you but, as I said, I am always up for persuasion myself and my only question is what is the British national interest, not what is a dogmatic position that it should never be changed.

Chairman: On the veto generally you have heard Sir John's generous offer that you can refine any answer you have made by letter if you feel that your career might otherwise be blighted.

Sir John Stanley

Minister, I have asked you a very substantive question, you have given a substantive answer, the Committee will rest on that answer. You have enumerated, I think, five areas where it is the British Government's position to retain the veto and the Committee will rest on that unless we should be advised subsequently that you were in any way mistaken in the answer you have given.

(Mr MacShane) I am grateful to you, Sir John, that is a fair point.

Mr Pope

I am confident, Minister, that we could not get a cracker cheese slice between the position of the Foreign Secretary and yourself. Could I ask a brief couple of questions about France and Germany and where you perceive the UK to be in relation to the European Union at the moment. A number of people have suggested that there has been a recent rapprochement between France and Germany, particularly over defence and the CAP reform. Basically the Franco-German axis is back in the driving seat of the European Union. First of all, do you accept that and where does this leave the UK?

(Mr MacShane) I welcome strong Franco-German co-operation and joint papers, just as I would welcome strong British-French or British-German or British-Spanish or British-Swedish ideas and papers. What I would say is that the European Union is a team of 15 and I do not know of any team of 15 that means there are just two people playing. The ideas being put forward by France and Germany are linked to the fact that next January they will celebrate the fortieth anniversary of the historic Treaty of the Elysee fashioned by General de Gaulle and Conrad Adenauer. I think certainly there is a burst of energy on the Franco-German front. To take CAP reform specifically, it is true that they agreed a joint position that the amount of money given to CAP would not rise until 2013 and would be spread over 25 countries, not 15, but then the German Government was strongly in line with our position that, notwithstanding that, in terms of freezing the amount of money going to CAP and spreading it more thinly it actually was not a bad deal. The Germans, the British and the majority of other European Union Council Members insisted that the Mid-Term Review, the proposals put forward by Commissioner Fischler, should remain on the table and in the actual communique, the declaration from that Council meeting, there was reference to the Doha round, and of course as we know under the Doha round agricultural subsidies have to be discussed. I do not think it is much of a secret to announce that elements of the French Government would have preferred neither to have the reference to the Doha round nor to the Mid-Term Review. There the German position was a bit closer to that of the United Kingdom.

Can I tempt the Minister, therefore, to be an outrider for Blairism by suggesting that we will not be at the heart of Europe as long as we remain outside the euro and that it is very much in our interests to join it as quickly as possible?

(Mr MacShane) I have said consistently, before becoming either Minister for Europe or a Minister at all, that there is far more to Europe than the euro and to reduce the question of Europe to its currency, significant as it is, does a disservice to an important debate. We have to get the economic tests right. The Prime Minister has made very clear that for Britain there are no political or constitutional objections to entering the euro system. We want it to succeed. It is in the interests of all of Europe to succeed. As the Chancellor said, and I do not know, Mr Pope, if you were at the meeting of the Parliamentary Labour Party last week when he outlined the five economic tests, he said, also, and I quote "If they are passed we will go out and win a referendum". When the Chancellor says he will go out and win something then I take heart from that. It is right that we analyse this in the most rigorous dispassionate way because the economics are extremely important.

Chairman

Back to President Prodi. Clearly the reform of the Council is on the agenda and with the additional countries there is a danger that Europe will be less able to act decisively, hence the Prime Minister has put forward his favoured option of an elected President of the Council, elected by the Heads of State and Government. What sort of response have we had to that? Has it been totally negative from the smaller countries?

(Mr MacShane) Chairman, if I may I will just correct you, what the Prime Minister called for in his speech in Cardiff was not a President ---

A pr_sident.

(Mr MacShane) --- which in English at any rate implies a very dominant figure but a chair or a Chairman. The thinking is one needs a Chairman of the European Council who can be there for a given mandate - I have seen figures of two and a half years or five years - and carry the work of the Council forward from Council to Council.

So there is a continuity.

(Mr MacShane) To maintain continuity and a historic sense of where the Councils have got to, to act as an explainer of what the European Union is doing, particularly what the Council is doing, to all of European citizens, to participate in some of the bilateral discussions we have internationally now with Russia and China but to do so in partnership with a strong President of the Commission.

What has been the response?

(Mr MacShane) The response is positive from a number of countries. I think there has been a very distorted, I would almost be tempted to say propagandistic, presentation of this idea that somehow it is a gang-up by big countries against small countries. My own view, and it is a personal view, is it would be quite acceptable to imagine that this elected Chairman would be a former Prime Minister or former senior leader of a smaller country, one perhaps that was used to consensus building, a lady or gentleman who spoke two or three languages and knew how to knit Europe together and to be an effective spokesperson for Europe.

Are any of the smaller countries supporting this proposal?

(Mr MacShane) Certainly Sweden is in favour and in my discussions, because frankly amongst the applicant countries remember they are all Members of the Convention and they want to have their word in the Convention process even if they are not full Members of the EU, they have been focusing strongly on the accession negotiations - quite rightly so - they have not had a chance to turn their mind to the other ideas on the table. We are not in a tick-off stage yet of saying "Here is an idea, hands up those who are in favour of it". I believe, certainly, very strongly, the more I have been thinking about this since taking up this post, the idea we can have a single Mr Europe is a nonsense. We need a strong Commission President, we need somebody representing the European Parliament, we need a Council Chair and, of course, we could have the Presidents and Prime Ministers of all the European countries who would be the men or women that other world leaders phone up as and when. We should not seek this idea of a unified, what has sometimes been called, European family. Europe is going to continue evolving and I think the Chairman proposal is a very good one, as I think the team presidency proposal is a good one. They have had a lot of support for that because otherwise countries are going to have to wait 121/2 years before they ever get a chance, as it were, to exercise rule in Europe.

We believe the Chairman of the Council for continuity and other reasons is a proper course. Are we trying actively to sell it to other countries?

(Mr MacShane) Yes. The agenda is there. The Prime Minister's speech which our embassies have translated and which has been circulated to all governments, I am circulating it also to many Hon. Members, to opinion formers in other countries, not just in the English but in a translation with a covering letter, and puts forward very clearly this idea that we want an effective Chair of the Europan Council as well as a strong Commission under a dynamic President to add to the coherence of the European Union, in particular since the Council represents the national governments and through them the votes in the national parliaments of all the citizens of Europe. We feel very strongly that the Council is not working as it should and the idea of a Council of 25 without some reform I think everybody agrees would be unworkable. I can tell the Committee I believe strongly in this idea. I think it has support from a number of countries. I do not think it has been well enough explained up to now and I will continue to advance it in my work as Europe Minister.

Chairman: Mr Mackinlay, you have a number of other areas to cover.

Andrew Mackinlay

Yes. The Barnier Working Group on defence, really I suppose what is your position on that? The way I understand it is that it fully recognised the rights, sovereignty of the national governments. It expressly minimises the involvement of the European Union Parliament, which I would have thought would have been welcomed here. I wonder if you could just give us your reaction to those proposals on the European Union collective defence doctrine?

(Mr MacShane) They are being discussed and examined and that is one set of ideas that has emerged in a snapshot way at the moment. The key players on defence to some extent - here one might as well be honest - are those that can really put effective amounts of men and material in the field, notably France and the United Kingdom with other countries contributing as well. If I may, Mr Mackinlay, I would like to call in Mr Ricketts on this. He is Political Director. I know, again prior even to taking up the Europe Minister's slot, the very hard detailed work that he has done, the to-ing and fro-ing and discussions on European defence. He could probably give a fuller answer at this stage than I can.

(Mr Ricketts) Thank you, Minister. As you say, the Barnier Working Group has produced a second revised draft of its report now. It is an evolving document and will continue evolving through the Convention. It incorporates already a large number of UK ideas from the contributions that the UK has made and particularly I draw attention to the idea that ESDP should develop now beyond where it was in the initial St Malo blueprint. We should take into account the evolution of challenges that the European Union faces. We should build in some aspects of stabilisation of what we call defence outreach, of using the European Union to help development and progress in the doctrine of armed forces of other countries in the neighbourhood. It looks at the issue of what ESDP and other aspects of the European Union can do to help in, for example, a terrorist attack against a Member State, aid to the civilian power in an emergency. It puts further pressure for capability improvements and floats the idea of convergence criteria to encourage countries to spend more on capabilities and it sets out thinking for incorporation on armaments in the second pillar, the inter-governmental pillar, of the European Union, again with a view to the most effective use of defence funds that Member States have available. There are many good ideas in the paper which originate in UK thinking and we will continue to participate reactively as that develops.

From the United Kingdom's point of view, what we understand to be the thrust of the Barnier Working Group is very helpful?

(Mr Ricketts) There is a lot of helpful material in it. Not every sentence in it I am sure the UK Government would agree with but there is a lot of helpful stuff in it.

So we are winning. I am not sure this is under the Barnier Working Group, this concept that there should be the equivalent of an Article 5 NATO doctrine, an attack on one is an attack on the whole, should come into the European Union. Personally I have never seen a problem with that because it seems to me implicit that you could not tolerate it, an external invasion of one might be deemed to be an attack on the whole. Where are we on that? Is there a problem on that? Do we have a problem on that? It seems to me a self-evident truth.

(Mr MacShane) I think that is contained in NATO. I think it is contained also in the WEU.

Yes, but in relation to the EU.

(Mr MacShane) Obviously the EU takes us into the area of neutral states. You may not be completely comfortable with that. Where I think the thinking is is a common approach to EU security, for example in the sense of a terrorist attack or a major disaster, in which the military would have to play a role in putting things right. There is not a lot of stomach out there for duplicating the principal role of common defence that is there in Article 5 of the NATO Treaty. Again I defer to Mr Ricketts as a real specialist in that field.

(Mr Ricketts) Minister, I agree entirely with what you have said.

(Mr MacShane) Good.

(Mr Ricketts) I always agree with the Minister. We have always said that ESDP should not undermine or duplicate NATO. We do see a real risk that if we start having collective defence guarantees in the European Union Treaty that would cut across what NATO's core purpose is for. To answer your question, it does indeed cover that issue but it makes clear that there are different views amongst different Member States on it and our position has been that it is best to keep collective defence guarantees with the integrated military structure to deal with them, which is NATO.

Okay. It seems barmy but anyway. Turkey. The British Government fully signed up to this repeated declaration that we would like Turkey to be in the European Union. There is some implied or inferred criticism of the comments of others who are more reticent. I have to say, and I want to bounce this off you, we do not even know the true population of Turkey. It bounds numerous states, I think it is something like six, including Iran and Iraq. Are we teasing the Turkish people by holding out even this medium term prospect of them coming into the European Union? The capacity to digest Turkey bears no comparison with any of the other Laeken 10. What say you on that?

(Mr MacShane) Chairman, Mr Mackinlay, I disagree profoundly. It is a huge challenge. It is a huge challenge for the Turks themselves in accepting the road map to Europe to ensure that they fulfil all the Copenhagen criteria: rule of law, human rights and so forth.

Sure.

(Mr MacShane) That can make the most profound difference internally. In a sense the opposite position, which is of Turkey looking eastwards, away from Europe, away from modernity, away from democratic reforms, away from respect of human rights, for me would be far more alarming. There are two groups in Turkey. They are not necessarily formally right or left but there are those who support Europeanisation, modernisation and those who do not. General de Gaulle called for a Europe from the Atlantic to the Urals.

That is right.

(Mr MacShane) The last time I checked, Ankara and Istanbul lie to the west of the Urals. It is a challenge, an enormous challenge, but I think a very exciting one and one I am very glad this Prime Minister has picked up and taken the lead in arguing for.

One of the things which is made quite clear - in case there is any misunderstanding I fully subscribe to this - is Turkey should not of itself be excluded because a lot of it is in Asia Minor and because it is predominantly Islamic that should not be a consideration at all, and we are agreed wholeheartedly on that. If we are agreed upon that, the word "Europe" is not magic, has there been any contemplation in the remotest corners of the Foreign Office thinking that the Union could be extended to even include the Caribbean countries of some states.

(Mr MacShane) It does already, Mr Mackinlay. All the French Caribbean countries are part of the European Union.

Precisely. I have not heard anybody exploring whether or not we could be inviting accession long term to other countries around the world.

(Mr MacShane) I think that there is a geographical contiguity in the case of Turkey. There are countries all over the world which are part of the European Union by dint of being fully incorporated, unlike our overseas territories, in the nation states of Europe, and I welcome that. A good part of the European space effort is based on the fact that the missiles blast off from the other side of the Atlantic ocean but they are still within the European Union.

The answer is it has not been thought about, has it?

(Mr MacShane) No, it is discussed regularly. It is a question of how you define Europe: is it geography ---

Turkey is in Asia Minor, is it not?

(Mr MacShane) The Treaty makes clear that only European States may apply. Turkey is, I suppose, geographically ---

Hawaii is not the United States, it is not on the Continent of America.

(Mr MacShane) Turkey has got a foot in both continents according to the classic geographical definitions. I want to make it personally as much orientated to Europe as is possible.

What is Europe is Belarus and the Ukraine. I understand President Prodi has made it quite clear that it is not even on the radar screen contemplating as an ambition Belarus and the Ukraine coming in. Now I understand the political position in Belarus does not meet the Copenhagen criteria, nor does Turkey at this moment, I am not putting them in quite the same league table. Surely we should have ambition. Ukraine, well quasi parliamentary democracy, looking not too favourable at the moment but these things rise and wane and there are tides in these things. Until recent times things looked pretty bleak in Turkish history. Ought we not to be thinking - both as a matter of justice but also out of naked self-interest, particularly from a security point of view - in terms of trying to offer the carrot to the people of Belarus and the Ukraine about European Union accession, albeit score years down the road?

(Mr MacShane) Mr Mackinlay, you are absolutely right, that is why at the last General Affairs and External Relations Council on 18/19 November the Council adopted what is called the New Neighbours initiative to look precisely at Ukraine, Belarus and Moldova. In the margins of the OSCE Ministerial conference in Oporto last Friday morning I had a very good talk with the Foreign Minister of Moldova who was quite clear that the EU was what his country would be aiming for because they are looking at Rumania now, their principal neighbour, coming towards the EU. We have not mentioned, of course, the Balkan states where there are specific road maps again for normalisation and, obviously, ultimately the entry into the European Union of a fully democratic Balkan region where respected international rule of law and other democratic norms is something we need to be looking at.

Chairman

You mentioned the New Neighbours, I understood there was to be a document prepared, initially it was suggested at the Brussels Council then it was suggested it should be made available for Copenhagen. Is there such a document?

(Mr MacShane) The Commission has been asked to review its policy on the New Neighbours initiative and indeed to come up with specific ideas.

What is the timetable for that?

(Mr MacShane) That work is in progress at the moment. Right now the principal difficulty with Belarus is that the European Union has put a travel ban on Mr Lukashenko.

Is there a document? If there is not a document now when will one be available?

(Mr MacShane) I do not have an answer to that question. What I can tell you is that the focus of attention of EU energy at the moment is trying to get respect for rule of law and political democracy higher up the agenda. Can I pass to Mr Featherstone on this.

(Mr Featherstone) A document was produced earlier in the autumn by Mr Solano and the Commission as a way of facilitating discussion. As you point out, rightly, there is the promise of a Commission document further down the track and the UK would certainly like to see ---

Do we know when that will appear?

(Mr Featherstone) We would like to see that appear as soon as possible. We have not got a time frame from the Commission.

Andrew Mackinlay

No doubt you note what we are saying as parliamentarians. I think we would like to see that. I realise it is not within your gift but I think HMG ought to chase them because it brings us on to Kaliningrad and, I think to the eternal credit of the Russian Federation and President Putin, I thought very generous accommodation was reached on that. It does seem to me we are going to have in our midst this island of acute deprivation, appalling health conditions, high HIV etc. If the Russian Federation want to pick it up or the Obalast (?) - I think that will be the term in Kaliningrad - do we have some programme, both again out of our naked self-interest and in the spirit of generosity, to rebuild society there - decaying fabric of the buildings, the infrastructure, poor health - and make it at least something which matches our norms which will surround it?

(Mr MacShane) This issue is very high on the agenda of my talks in Vilnius with the Lithuanian Government because they are most directly concerned. They were pleased at the agreement of what is called a facilitated travel document which will allow the Russians in Kaliningrad to travel principally across Lithuanian through the Schengen area to arrive in Russia. There are other discussions about high speed trains, sealed trains. I was not entirely sure, given the experience of sealed trains in Russian history, that was such a good idea. Mr Mackinlay, Chairman, is absolutely right to draw attention to the lamentable state of Kaliningrad.

Chairman

Is there a master plan in co-operation to deal with that?

(Mr MacShane) I think it would be going too far to say there is a master plan yet. Kaliningrad is part of Russia. President Putin originally wanted more than what the final agreement came up with. He wanted complete visa free movement between those two parts of Russia. I think again, as the European Union borders advance eastwards or north and east to the Baltic regions, particularly to Lithuania, that will put a different kind of spotlight on Kaliningrad. I think it is of deep concern to our Nordic neighbours, to Finland and Sweden principally, and whether there needs to be a Commission master plan or just all the neighbouring countries bearing down and trying to remove the sources for instability, poverty, crime and health risks in Kaliningrad, I think that is a better way forward than asking the Commission yet again to produce another master plan.

Andrew Mackinlay

Yes but - and I do not mean this facetiously at all - listening carefully to your crafted words there - I do not mean this sarcastically - it does seem to me, particularly in response to the Chairman, there is not a plan, there is not a document which you could take off the shelf tonight and supply to this Committee saying either that the United Kingdom bilaterally or the European Union have got a document of what they are going to make available, offer to people of Kaliningrad/Russian Federation and there does not seem to me to be any promise it is going to be on a particular date. Now I would have thought - this Committee has got to discuss this - that this is something which will concern and exercise us when we bring our report. If I am wrong, do you think you could drop us a note, as it were, saying what the position is? Amongst my colleagues I want to pursue this. I think it is in our UK interest that we should avoid this. Listening to you, and as I say I do not mean it critically, it does not seem to me there is anything.

(Mr MacShane) Chairman, I do not think this is entirely fair. Kaliningrad is part of Russia. It is not a separate country, it is not a separate state. We have a partnership and co-operation agreement with Russia which sets out certain ways of moving forward the EU relationship with Russia. Clearly that covers Kaliningrad and it would be quite wrong, I think, for the EU to tell Mr Putin that a completely separate programme is needed.

Chairman

It is not a question of telling. What I think Mr Mackinlay is saying is this. Here we have a great Hanse port, the old Königsberg. It has the historic anomaly that at the end of the war it is left there, as Mr Mackinlay has properly described, decaying, disease ridden and not fulfilling its potential. It is not a question of imposing on the Russian Federation but it is in both our interests to try to improve the quality of life and the ability of that area which has been described, rather ambitiously, as a potential Hong Kong, to improve it by mutual co-operation. Have there been any such discussions?

(Mr MacShane) Yes. Under the partnership and co-operation agreement and in the meetings that the EU holds with Russia on a joint EU/Russia Common Strategy. It was at that meeting, if you recall, where the agreement was reached on the facilitated travel documents, clearly Kaliningrad featured. I am happy to assure the Committee that I will keep that under review. It has to be in the interests of Lithuania and Russia, the other Baltic states, that Kaliningrad --- forgive me, Chairman, if I am a bit nervous about reverting to its historic name of Königsberg, I prefer Gdansk to be Gdansk and not Danzig and "le beef" not to be "le boeuf". I think in the region the world is very much seized of the Kaliningrad problem, perhaps more so than we are in the UK and that does seem to me to be appropriate. I do not think, if I can be very personal, that you can keep turning to Brussels saying "produce an action plan on this and a master plan on that". What we can do is work regionally. The UK may have a specific contribution to make to upgrade the quite deplorable conditions of existence for the citizens and infrastructure of Kaliningrad.

Andrew Mackinlay

I have really exhausted everything. The only thing is interpretation. A machinery point but actually in the great cost of things it is enormous. I think at Copenhagen one is going to be discussing languages. What is the UK's position on this? It does seem to me we do need a two tier system, obviously translation where necessary but really we do need to come down to about four languages, do we not? In fairness, the Irish Republic, a longstanding Member, does not exercise their right to have Irish used, other than in a very minimal way.

(Mr MacShane) There is a lot of discussion on this. I am a bit reluctant to be the Solomon who decides which language is thrown away. I am proud of Europe's diversity and I think it is worth making an effort and yes it does cost a bit of money for interpreters and translators to keep the right of different people to have their languages. Certainly I would not like to take part in the voting on I think Mr Mackinlay mentioned four languages.

Well ---

(Mr MacShane) Well, you know, five or six or three, somebody has to throw a few out of the window and I expect, if I may say so to Mr Mackinlay, who is a well known friend of Poland in this House, our Polish colleagues might be less happy.

Slovak language.

(Mr MacShane) English, French, German, Spanish and Polish. Now, Mr Prodi, I presume, would like to talk in his own language now and then so that is a sixth, you see the direction we are going in. There are some proposals called request and pay. There are some ideas of having a limited standard interpreting regime. I think we are going to have to work at this but I think it is one of the glories of Europe that we are diverse linguistic regime.

Chairman: Not today anyway.

Sir John Stanley

Minister, just in the closing minutes, could I just come back to two items which have been raised which are very important and neither of which appear to have made it to the agenda for the Copenhagen Council as far as the British Government and indeed other governments are concerned. The first is one raised by Mr Mackinlay which is this issue of corruption in relation to the existing EU Member States. As we are all aware we get the annual report of auditors each year. Every year they report that billions of euros have been misappropriated, mismanaged, gone missing, the figure does not seem to go down, it goes on year after year. Despite the efforts the British Government and perhaps others have made so far we do not seem to be getting any improvement. Since we last took evidence from the Foreign Secretary on the EU issue we have had what I call the dismal case of Ms Marta Andreasson, a senior EU Commission official in the budget and accounting area who had the temerity and indeed I think, frankly, the public responsibility to expose the fact that the EU Commission's basic accounting standards were way below those of any other international organisation, let alone private commercial practice. It is handling huge sums of money with basically wholly inadequate budgeting and accounting systems. Can I return to you on this. Is this an issue which the British Government is just going to continue to shrug its shoulders on or is the British Government going to make a further determined effort to try to get rid of what is obviously a serious blight on the perception of the EU amongst taxpayers right across the length and breadth of the EU? Is the British Government with other governments going to really start talking tough to the Commission and say "You either sort this out or otherwise we are going to have to take some serious measures against the Commission"?

(Mr MacShane) I think, Sir John, there is widespread concern on that and I think it reflects also the distorting impact of the Common Agricultural Policy absorbing 48 per cent of the total EU budget. Very often it is at the end of where sheep get sold across borders, where pigs are double counted, where tobacco and wheat and wine disappears into the wonderful world of agricultural accounting that an awful lot of this fraud takes place. Indeed there are a number of cases against British citizens in respect of EU fraud, I think principally because we have got a much more rigorous and tougher approach generally in terms of public auditing in the UK. Yes, I share your concern. I think it does immense damage to the EU's good name. Certainly it is something I want to look at as a Minister, finding the exact mechanism to clear this up is not easy. I do not doubt the good intent of the commissioners who have been looking at it in recent years, any more than I doubted the good intent of commissioners who looked at it ten or 20 years ago. As far as I can remember this accusation has been laid at the EU's door, particularly the Commission's door and Brussels' door since we entered the Commission. Again, it is quite hard in the time of Enron and Arthur Andersen to assume that private companies are immune to corruption and fiddles. As I say, we have an enormous National Audit Office, I do not know what its total employment is but it may well be as many if not more than all of the full-time functionaries employed by the Commission in Brussels just to try and bear down on fraud in our own country. Every month I hear its distinguished Chairman, Mr Leigh, on the Today programme announcing some immense boom double they have uncovered involving corruption and fraud within this really remarkably honest and rigorously policed, in accountancy terms, public sector in the United Kingdom.

Can I come back to the other major item which has not made it to the agenda, which is Zimbabwe. If I can just put this to you, Minister. As Sir Patrick, who led off on this, indicated in that country, with which the EU has a clear foreign policy position and therefore has assumed a measure of responsibility, we have gross abuses of human rights that have been carried out in Matabeleland, we have imprisonment without trial, we have basically state authorised violence against individuals, we have access to food, therefore starvation being used as a political weapon. We have huge numbers of Zimbabwean black farm workers who have been dispossessed of their livelihood, dispossessed of their property, dispossessed of their possessions as a result of the government's policy of expropriating the white farmlands. Can you assure the Committee that although sadly, deeply regrettably, I would say frankly deplorably, it has not made it to the agenda for this Council that before we get to the Greek Council, the end of the Greek Presidency, the British Government is really going to make determined efforts to get this up the agenda as far as our EU partners are concerned?

(Mr MacShane) Of course, Sir John. I repeat the assurance and statement I made earlier that to my knowledge no Foreign Secretary has spent more time raising the issue of Zimbabwe with his European colleagues than the present one. I do not say that out of loyalty, I say that out of sitting every morning at the meeting when all ministers gather when they are in London at nine o'clock in his office and Zimbabwe and the contacts and discussions he has had with his European colleagues is there again and again, as are the reports by Baroness Amos. I think even this week the Foreign Secretary was planning to discuss this because there is talk of an EU-Africa summit next year in Lisbon and the question then is of Zimbabwean participation and if the Zimbabweans are barred from entering does that mean that the other African Union countries will refuse to come. These are big issues. Britain is in the lead but, my goodness, how much easier it would be if this was a pan-European issue and if our own papers could just give up the trivial rubbish they have been filling their pages with in the last few days and concentrate on this and other pressing world issues.

Chairman

Minister, I would like to end by building on the question which Mr Mackinlay raised with you about the New Neighbours and, to use the term which you have used several times, the road map for Europe. We know that in May 2004 the ten Laeken countries should become Members of the Union. We know that if all goes well Romania and Bulgaria will become Members in 2007/08. You have spoken yourself of the real possibility that perhaps after ten or 12 years Turkey itself will be a member. I would like to know where you think along that road map other countries, and I think particularly the Balkan countries, are likely to fit in. No-one can doubt, for example, that Croatia in terms of its culture, its values, increasingly its economy, will be a fit and proper member of the Union within a reasonable period of time, so there is Croatia. The Balkan countries are concerned that by some form of failure to differentiate some will be held back, perhaps Croatia, because other countries, be it Macedonia, be it Serbia, be it Albania, will not fulfil the criteria. Are you prepared to speculate as to where along that road map between 2004 and Turkey some other countries, which are clearly within Europe, are likely to be inserted into your road map?

(Mr MacShane) I think it depends very much on them, Chairman. At the Faro European Council it was concluded Albania and four countries of the former Yugoslavia - Bosnia, Croatia, Macedonia and Yugoslavia - were all potential candidates. We have worked and I have worked as the Minister responsible for the Balkans in supporting those aspirations and helping to bring technical expertise to upgrade the European Union aspirations of all those nations. Certainly there is an exceptionally good European Integration Office run as part of the Croatian Ministry of Foreign Affairs. At the same time I am faced with the dilemma that that country, as with Serbia, refuses to comply fully with the international tribunal in The Hague, in transferring indicted alleged war criminals for investigation. They are protected, either formally or informally, by the government or by the military machines within those nations. Again and again I have said to them that the road map for their European aspirations lies in part through The Hague. I completely agree with you that it is in their hands. I think we need some differentiation as well because going a bit further east, Moldova, Ukraine and Belarus, all have different levels of both political and economic development. They will look now at the ten countries coming in this week, those will be the models to emulate Bulgaria and Romania a bit further down the track and Turkey we hope starting hard negotiations soon and upgrading its political and economic ability to be a full European Union Member. This is how Europe should work, in an osmotic effect, a benchmarking effect, an effect of models for others to adapt to.

Minister, we began by saying that we regretted because he was held up in Brussels the Foreign Secretary was not here. We are delighted that you are here in your own right, the first time as Minister for Europe, and we are very pleased that you have been able to assist the Committee so well. Very many thanks.

(Mr MacShane) Thank you very much, Chairman.