TUESDAY 1 APRIL 2003

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Members present:

Donald Anderson, in the Chair
Mr David Chidgey
Mr Fabian Hamilton
Mr Eric Illsley
Andrew Mackinlay
Mr John Maples
Mr Bill Olner
Mr Greg Pope
Sir John Stanley

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RT HON PETER HAIN, a Member of the House, Secretary of State for Wales, Government's Representative on the Convention on the Future of Europe, and MR KIM DARROCH CMG, Director, European Union, Foreign and Commonwealth Office, examined.

Chairman

Secretary of State, welcome, as usual, in your very different guises, to the Foreign Affairs Committee. Today you have with you Mr Kim Darroch, the Director, European Union, at the Foreign Office, and you, as our Government Representative on the Convention on the future of Europe, will be able to help the Committee both in respect of the Convention and then the way that prepares for the Inter-Governmental Conference in 2004. I begin in this way, Secretary of State. You and your colleagues in the Convention are involved in a major undertaking, perhaps not as grand as the Philadelphia Convention in the United States but, nevertheless, a very important undertaking. Now some countries are bound by their constitutions to hold referenda in issues of this magnitude, I believe Denmark and the Republic of Ireland fall into this category; others have said that they will choose to do so, and I think France and Spain fall into that category, because the Convention and which follows will alter the rules of the game, if you wish. What is the position of the United Kingdom Government, HMG, in respect of a referendum on the results of the Convention?

(Mr Hain) We do not intend to call a referendum, any more than one was called on the Maastricht Treaty, which I think was arguably far, far more wide-reaching and deep in its impact than this one is likely to be, which after all is likely to be a tidying-up exercise, in terms of a new constitutional treaty which clarifies and simplifies a lot of the existing treaty text, and some additional, new extensions. But, I think, to be consistent with past practice, if we were to call a referendum on this outcome, we would have needed to call one at least on Maastricht, which the previous Government did not do, and perhaps on other outcomes of inter-government departments.

You do not think there is a difference with Maastricht, in that Maastricht was an important treaty, which was considered by the House following its normal treaty-making consideration, but in this case a constitution will emerge, the rules of the game will be altered; absolutely, fundamentally important?

(Mr Hain) It is fundamentally important, but I do not accept that the rules of the game will have been changed to the extent that a referendum would be triggered automatically, in a way that was not the case, and has not been the case, for previous treaties. If you look at the drafts that have been produced so far, yes, there is some tweaking, some additional measures, to keep pace with events in the new draft Constitution, but also, to a very large extent, it is bringing together in one, we hope, simple, though we will have to see, constitution the many thousands of words in the different treaties that have been assembled up to now. So we see it as a consolidation, with some modifications and some changes, of where we have been for many decades.

So your assumption is that, at the end of the day, this will be no more than what you call a consolidation, a tidying process, and have no substantial constitutional significance?

(Mr Hain) I am not saying it has got no substantial constitutional significance, of course it will have, but, by comparison with other treaties, as they have developed and amended the ones that have gone before them over the last decades, this one I think should be seen in that context, not as some new and absolutely dramatic or revolutionary departure from where we have been.

And that is the final say of the Government in respect of a referendum?

(Mr Hain) It is; this Government, certainly.

Let us move on then to the Convention which will report, whenever, in June, July, or even September, of this year, followed by the Inter-Governmental Conference next year; that will lead not only to a treaty but to a constitution. What is your view as to how that constitution will be amended?

(Mr Hain) First of all, if I could just go over the procedure; we hope, and it is planned, that the Convention will end in June, a report made to a special European Council on 30 June, that is a proposal now under active consideration, and I think there is a wide consensus for it.

And we are on track for that?

(Mr Hain) We are on track for that, and then an Inter-Governmental Conference will follow, and obviously a final constitutional treaty then will be subject to ratification.

And what is the amendment process which you envisage for that treaty, for the constitution?

(Mr Hain) Are you saying, once it has been agreed and ratified then how can it be amended subsequently?

Yes.

(Mr Hain) That has not been finally negotiated or decided, but I guess you would need a similar process, at least in terms of an IGC.

But already there is a debate about how the new constitution should be amended. I understand, for example, that the European Parliament - surprise, surprise - are saying that they should be responsible for amendments. Surely the Government has some view about the amendment process?

(Mr Hain) The European Parliament comes up with all sorts of dodgy ideas from time to time, and if this is one of them, well, so be it.

Well, how do we respond to that dodgy idea?

(Mr Hain) With the appropriate response to all dodgy ideas, I think, Chairman.

Are you saying that the Government has not considered this matter?

(Mr Hain) As I say, there has been no serious focus in the Convention so far on the amendment procedure, it has been aired; but for something as important as a Constitutional Treaty, after all, this new constitution should be designed, and certainly the intention is for it to last for a considerable time, so we do not have this constant process of a permanent constitutional revolution in Europe, we have a settled constitution.

But every constitution has a process of amendment, and that process of amendment is normally contained in the constitution itself, as in the US Constitution and that of any other country; so surely there will come a time very shortly when this will be discussed?

(Mr Hain) As I indicated earlier, there would have to be another Inter-Governmental Conference. There has been no proposal that I have seen of any weight come to suggest otherwise; and, of course, ratification, as well, of any outcome.

Mr Hamilton

Secretary of State, the Laeken Declaration did not specify that the Convention should produce a draft Constitutional Treaty but a document that should provide a starting-point instead for discussions at the IGC. Would you have preferred that the Convention produced simply a series of points for discussion, rather than a draft treaty?

(Mr Hain) No. I think, just from my own personal point of view, having spent every year of my life there, and a fair number of pretty heavy lifting weeks to come - - -

Chairman

You make it sound like a prison sentence?

(Mr Hain) Well, I would not say that. But I would hope that it produces an outcome that is, if not an agreed position, a completely agreed position, that can go into an IGC, commanding such support that it could expect to go through without radical change, then as close to that as possible. No, I think, the way the Convention is developed and the attempts that we have all made to develop a consensus around the key and the most difficult issues, we are within sight of getting a new political architecture which has got a broad consensus. But we will have to see, there are very many sticky, difficult issues for us, but for many other countries, and it remains to be seen whether we can achieve a consensus on that. If we cannot achieve a consensus on that, which is the aim, then we may well be into options, in which case it will be for the IGC to resolve in the traditional fashion.

Mr Hamilton

I was going to come on to that, because, as I understand it, with 16 Articles now being published of the draft treaty, I think it is 16 that have now been published, there are, what, over 1,200 amendments to those first 16 Articles alone, do you think really it will be possible to achieve a consensus, given the number of amendments that already have been put in?

(Mr Hain) We have put in ten times the number of amendments as anybody else.

That begs the question then, does it not?

(Mr Hain) I do not know whether that is a badge of honour or not, but it remains to be seen. But I think, on some of the key issues, there is quite a lot of consensus; on some of the others, I think people are striking negotiating poses and, in the case of some components of the Convention, European Parliamentarians, amongst others, maximalist positions that they know Governments, in the Convention and ultimately in the IGC, simply are not going to accept.

But, Secretary of State, the fact that we have submitted so many more amendments than other countries, does not that mean that we are losing the arguments?

(Mr Hain) No.

Does not that mean that this is not reflecting our interests?

(Mr Hain) No, on the contrary. It means, perhaps, with all due respect to our colleagues, that we take these things very seriously; and I have serving me not just a team of Foreign Office officials, experts all of them, but also an across-Whitehall team of officials and Government lawyers, and we are taking this extremely seriously, because we know that the outcome will have legal force. And often I find the debates in the Convention, from some quarters, people often are putting forward almost, as it were, idealistic policy positions, that they do not consider the consequences of carrying into legal text; that is why we are being very, very serious about it. And I do not think that, as it were, the ratio of amendments that we have submitted, or the total of amendments submitted by anybody else, indicates necessarily that we will not get a consensus.

But you said that you do not favour permanent revolution, as it were, if I can use that expression, and yet you said also that it will have a legal force once agreed. Now surely it will be very difficult to unpick things that we do not agree with which fundamentally are opposed to what the British Government wants to see once we have achieved that status of the legal framework?

(Mr Hain) We have a legal framework now, which has involved very difficult negotiations, the Nice Treaty, for example, many days, and extra shirts had to be provided and other clothing in order to get through the whole process, so I am not saying this is going to be easy. But we will not agree to anything which is against our national interest, and so we are quite confident about the whole process. There are going to be some very, very difficult issues to resolve in the end game, and it depends on our negotiating skill and our political determination as to whether we can get those where we want them, or where we have to end up.

But you are confident that, at the end of the day, what is produced will be in our national interest?

(Mr Hain) Yes, I am; for the very simple reason that if it is so fundamentally against our national interest then we will not agree to it, it is as simple as that.

Mr Olner

Secretary of State, it is very difficult for the 16 to come to a common view on what the constitution should be; has there been any discussion with those states which are seeking accession to the European Union, have they had an input into the draft constitution?

(Mr Hain) As you will know, the new member countries, not just the ten that are coming in next year to add to our 15, making 25, but the two others, Bulgaria and Romania, that are in the accession process already and will come in in some future years date, and Turkey, the additional country, making 28 countries in there, I think that our discussions with a broad range of countries, both existing Member States and new Members States, put us right at the centre of gravity of the Convention. And I have been very struck about how that is. There are one or two issues where we are in a smaller minority, but we are not alone, and there are other issues where we are in the great majority, but, most of all, we are right in the middle, in the centre of gravity, which is where I think a leading European power, such as Britain is, should be.

I am not going to put words in your mouth, so that is Old Europe versus New Europe?

(Mr Hain) Well it is a little more complicated than that. A lot of the new member countries share our concerns about the nation states being the foundation of the European Union, not least because they themselves have enjoyed perhaps only 12, 13 years of freedom from being controlled from Moscow. On the other hand, a lot of the existing Member States - Sweden and Denmark, and actually France - in the institutional architecture are very similar to us, as is Spain, as is Italy, in terms of the nation states being the foundation, rather than everything being communitised and there is some kind of federal superstate being erected, which perhaps is closer to the Benelux position, and maybe Germany's. So I think it is not just New and Old Europe, whatever that means, I take it to mean - no, I will not try to define it.

Mr Maples

Secretary of State, I think that the big issue with this constitution, for a lot of us, is, is it some clear codifying of the existing treaties into a more sensible and comprehensive reform, or is it actually a constitution for a United States of Europe and creating a single European state? And, for me, there are four pretty crucial tests of that, and I wonder if I can ask you the Government's views on each of them. The first, and I think perhaps the most difficult, is the incorporation of the Charter of Fundamental Rights. It seems to me, it is not like the United States' Bill of Rights, so a series of legal rights, but actually it is a list of mainly political aspirations; if it were included in the Treaty, as is proposed in the current draft Articles, presumably it would become justiciable in the European Court. I know that the Government resisted this for quite a time, but now seems to be arguing that by the wording of parallel clauses one can perhaps constrain it. I wonder if you could take us through what is the Government's position on including the Charter of Fundamental Rights?

(Mr Hain) If we go back to Nice, in 1999, we were quite content for the Charter as a political declaration of admirable principles. The issue that concerned us is precisely the one that you have focused on, quite understandably, would it be justiciable or not; and we took the view that, as it had been drafted then, if simply incorporated into the treaty, as was proposed by its most fervent advocates, it would have been justiciable, and therefore it could have overturned our domestic law, and we were not having that. Where we have got to now, in the Convention, mainly as a result of really sterling work done by Baroness Scotland, my alternate in the Convention, who has done a really, really excellent job, we have managed to secure agreement, with the support of the Justice and Home Affairs Commissioner, Antonio Vitorino, of strong horizontal clauses in the Charter that prevent it, as it were, coming down into our domestic law, to stop competences being extended, and therefore prevent it being justiciable. That was where we were in a consensus position in the Working Group and in the Convention plenary which endorsed that Working Group. The way it has come out so far in the draft constitution, the way the Article was drafted, it fudges that rather, in a way that is not acceptable to us. And so what we have to have, even to be prepared to consider whether we would support the Charter being incorporated in some fashion, is that it stands not embedded in the first part of the treaty but perhaps as a protocol, with a read-across from the main treaty which makes it absolutely clear that the horizontal Articles stop precisely that justiciable impact that we would not accept. So, just to summarise, we are in a position, we are seeking to negotiate a change from where it is in the draft, and, frankly, it is such an important principle for us that we will not accept it being incorporated in some way unless that copper-bottom guarantee is given.

So it is a non-negotiable point for the Government that the Charter of Fundamental Rights should not become directly justiciable in the European Court of Justice, as a result of this treaty?

(Mr Hain) The point is this, that what you have to do is stop, for example, our employment laws being overturned, or somebody who feels they are not getting hospital treatment quickly enough taking their local trust to court under this provision, and so on and so forth, precisely the things that concern you and equally concern us. So if we can get the commentary properly drafted alongside the Charter, and if the horizontal Articles are as we want them to be, and if we can position it in the whole structure in a way that we want, then we are willing to look at it, but unless all of those ducks come into a row, no, we are not.

Can I take you through, just quickly, my other points. The Common Foreign and Security Defence Policies, it seems to me crucial, if this is to be not a constitution for a United States of Europe, that those policies should remain (a) inter-governmental and (b) subject to a veto. What is the position of the Government on those two questions?

(Mr Hain) Yes, they should remain inter-governmental, and subject to unanimity, save for those areas which are already, in terms of implementing decisions, and so forth, subject to Qualified Majority Voting.

What would be the Government's view about collapsing the pillar structure so that the Commission had a role in foreign and defence and security policy?

(Mr Hain) Obviously, the Commission has a role already, in that the functions carried out by Chris Patten, for example, on association agreements and aid and development, and the other foreign policy issues around it, so it has a role already; but, no, as far as we are concerned, CFSP is a matter for Governments and will remain a matter for Governments.

I think my next two questions are capable of very quick answers. One is that it seems to me that in the treaty, again to reinforce the position that this is not creating a single European state, there should be a presumption in favour of subsidiarity, which was not in the Charter to good effect. I wonder if the Government would agree with that?

(Mr Hain) Yes, and, returning to the question I was asked earlier by Fabian, we have had a very important advance already, which is pretty well secured, subject to how finally it turns out, in the final draft, that national parliaments, for the first time ever, will be given rights, through an early warning mechanism, to declare whether they think that a new proposal for legislation, or some other initiative, infringes the principle of subsidiarity. So that is an important advance.

Yes, but it requires an awful lot of national governments to agree, to trigger the procedure, as it is outlined at the moment, and my point was, if there were a presumption in favour of subsidiarity, you would not get what you have got in, whether it is Maastricht or Amsterdam, I forget, that remains a provision of that subsidiarity, but it is never honoured because it does not have any teeth in it. If the Court had to interpret the Union's powers in the light of a presumption of subsidiarity, it seems to me that that would make that question much easier to deal with?

(Mr Hain) I can see where you are coming from, but there are lots of things that we want Europe to do, we want Europe to improve our security against terrorism, or human trafficking, or international crime; we have got to be very careful that, as it were, we do not modify the situation that stops Europe acting. What this procedure is designed to do is put national parliaments in pole position, right before the Commission can proceed, to be able to have a right to say 'no', this should be done at a national state level and not a European level, and I think that is very important. And an equally important consequence of it will be, in my view, that the Commission, and the Council and the Parliament, because those two institutions often are responsible for making subsidiarity and proportionality questions worse, that the Commission, initially, it will be a deterrent factor, they will be thinking to themselves, "National parliaments are going to take a view on this before we can get to first base," and therefore they will be extra vigilant about subsidiarity and proportionality.

One of the differences between the constitutions of federal states, like the United States, and the constitutions of international organisations, like, say, the WTO, or Council of Europe, is an explicit right for a Member State to leave; and I wonder if you would favour that? I think that, if there were an explicit, as opposed to an implied, right in the treaty to leave, and I know that, theoretically, we can repeal the European Communities Act, but if there were an explicit right for Member States to leave then I think that would allay the fears of a great many people who fear that this is a constitution for a single European state. I wonder what is the Government's position on that?

(Mr Hain) We are quite relaxed, quite happy, about an exit clause, as it were, and for it to be defined as such. But can I say just one other thing. There is not a cat in hell's chance of a federal superstate being agreed by this Convention; it is not just a question of we will not agree it, Spain will not agree it, France will not agree it, Italy will not agree it, Sweden will not agree it, Poland will not agree it, and that is just for starters. So, whatever the ambitions of some European Parliamentarians, and maybe some members of the Commission, and maybe some of the smaller existing Member States, there is no chance of that happening at all.

We always hear that, and if the draft Articles which are coming out of the Convention are put into the constitution then I think what you will have is much closer to what I fear than what you say is going to be acceptable?

(Mr Hain) No, I do not agree, and I think when you see the final version you will be much reassured.

Mr Maples: I hope so.

Sir John Stanley

Secretary of State, could I take you back to what the Government said in its White Paper prior to the previous Inter-Governmental Conference, the White Paper that was published in February 2000, entitled 'The British Approach to the European Union Inter-Governmental Conference 2000', on the issue of unanimity. The Government said this: "Clearly, some areas, such as treaty change and accession, will have to remain subject to unanimous agreement, and the Government has also made clear that we shall insist on retaining unanimity for other key areas of national interest, such as treaty change, taxation, border controls, social security, defence and own resources, the EU's revenue-raising mechanism." Can you tell the Committee whether that remains the Government's position?

(Mr Hain) Yes.

Andrew Mackinlay

I realise that one of the great strengths of the European Union is it is a ratchet which almost guarantees enduring democracy; but one can foresee a situation, with an enlarged community, a decade down the road, in one of the countries admitted, such domestic strife that there could be, for instance, a coup d'_tat. What mechanism is there to get rid of a country, expel a country, suspend a country, where it does not comply with the Copenhagen criteria?

(Mr Hain) I might call on the help of Kim, in this, but membership to accede to let alone become a permanent member of the European Union, you have to maintain, you have to abide by the Copenhagen criteria.

Well, that is democracy, yes, I understand that.

(Mr Hain) What are the areas in which you can suspend them; perhaps you can help me on that, Kim.

(Mr Darroch) I cannot quote to you the precise text. There are provisions already which say that if a Government departs from the basic principles, European values, that all in the European Union should share, then there is some sort of process which requires at least consultation amongst the other Governments about the next step. And you will recall there was a decision in relation to Austria, two or three years back, when the Freedom Party became a part of the Austrian Government, under which such measures were taken against Austria. So there are procedures there; they are being looked at as part of the Convention process, so they may get adapted in the treaty text that is put forward to the IGC. It is not clear how the others will mark it.

No; I am very grateful, and I do not mean this disrespectfully, but, in a sense, you are struggling, because clearly this has not been looked at, and I put it to you it has to be looked at with some vigour. The Austrian example is a bogus one. As reprehensible as I might have thought the Government elected in Austria, it was elected by parliamentary procedure.

(Mr Hain) And your point is, a coup, or something like that.

Yes. And that, ten years down the road, I put it to you, it is not inconceivable; there is one applicant country which has a relatively recent record of military rule and has a very strong military, admittedly it is not in the first tranche of accession. But we have the difficult issue of Cyprus, and also there could be other countries where things have gone extraordinarily badly, and it does seem to me you need to build in a mechanism, not where there is "consultation" but where there is a final sanction of suspension in pure terms, not a formulation or expulsion. Because the other political institutions around the world, because we are not building a United States of America, but let me use that in contrast, demonstrably the federal government can move in, if you had a state which was not complying with democratic norms it could not endure; but precisely we are not vesting that power in the Union.

(Mr Darroch) I may now have found the relevant bit in the existing Treaty, which is Article 7. Do you want me to read it out?

I am genuinely interested in this, you know, it is probably prophetic words.

(Mr Darroch) It is quite a lot, but I will paraphrase it.

Paraphrase it if you like.

(Mr Darroch) If a proposal by a third of the Member States or by the Commission and with the assent of the European Parliament, the Council, Heads of Government level, the European Council, decides that there exists a serious and persistent breach by a Member State of the basic principles of the European Union, then the Council, acting by a Qualified Majority, may decide to suspend certain of the rights deriving from the Treaty in relation to that Member State, including the voting rights, and in doing so the Council should take into account the possible consequences of such a suspension of rights on the rights and obligations of the citizens of that state. So there is a provision in there already, that is being looked at.

Yes, but it is not, is it? I listened very carefully to what you said. They are sanctions, it is a withdrawal or suspension of rights, not putting them outside the club?

(Mr Hain) I think that Andrew is raising a really important point, and I will give him an assurance, Chairman, that this is something that we are not simply going to skate over, that is an important principle, as Europe enlarges, which I think is your point, this is an issue that must be to the forefront of not just our minds but the mechanisms by which the EU operates.

Chairman: I think Mr Mackinlay's point is clear, there are more fragile countries likely to be within an enlarged Europe, there should be a provision for suspension, and we want to know where it is. Perhaps you could write to us with not only that but with what discussions there have been within the Convention?

Andrew Mackinlay

I am content with what the Minister has said.

(Mr Hain) I will be happy to do so. You will appreciate that this is being done bit by bit and we have not yet really paid a lot of attention to that.

Andrew Mackinlay: Chairman, I know we are concerned primarily with these Working Groups 7 and 8, but is it competent for us just to ask about the parliamentary oversight; what is our remit this afternoon?

Chairman: Yes, we can deal with it.

Andrew Mackinlay

I understand that what is being explored is, in terms of national parliamentary oversight, that there should be, if I say a complicated procedure, I am not saying that critically, as it were, but just whereby some things can be flagged up and referred to national parliaments and if two-thirds of the national parliaments fought a proposal, it could be blocked; is that correct, can you help me on that?

(Mr Hain) Yes, I will be happy to. There is a proposal widely agreed, and pretty unanimously agreed, that there should be an early warning mechanism, that any new proposal from the Commission would have to be e-mailed to national parliaments, then, within four weeks perhaps, perhaps six weeks, not finally negotiated, they would have to declare whether they think that the principle of subsidiarity, that is to say, that was done at a European or a nation state level, had been infringed and there is still an argument about this, but we hope whether proportionality, that is to say that the issue is too intrusive, the proposal is too intrusive, and to straightjacket it, whether that has been infringed. And if a third of the current state of play in the Convention, though there is still some negotiation to do, if a third of national parliaments say that those principles have been infringed then, as it were, a yellow card is issued to the Commission, that is obliged to reconsider, perhaps withdraw, or completely redraft its initial proposal in the light of that. So that is a very important advance for national parliaments, and I think will empower national parliaments in Europe and give them a real stake in European policy-making in a way that has not been the case up to now, except in a retrospective fashion.

Andrew Mackinlay: Indeed; and I welcome that. But could I put it to you, as a Minister, that complementary to that situation, let us assume that a proposal along those lines is going to be adopted, which would be on the face of it a major addition to the tool-box of national parliaments, that we would need some institutional arrangements here agreed which meant that such examination was not done on the purely sort of automatic whip basis, and perhaps there would have to be the appropriate committee here do it, otherwise you might as well just leave it at government level if it is going to come to Westminster and then be dictated by Government through the traditional party whip system. I do not mean that disparagingly; it means, if you are shipping it to Parliament, it has to be meaningful at Westminster. And I wonder if you have had an opportunity, or would you please discuss this with your colleagues to see how it could be made meaningful at Westminster, otherwise there is no point in going through the charade, you might as well just leave these matters at government level, at the Council level; it has to be translated down here, does it not?

Chairman: That will be a challenge obviously for our House to adjust our procedures, for example, to respond speedily if the House is in recess.

Andrew Mackinlay

And rather than do battle after it has arrived, it seems to me that some preliminary thinking, it is not unreasonable, should at least be given both within Government and across the parties as to how it could be meaningful from day one, rather than have a big bust-up constitution-wise?

(Mr Hain) I very much agree, and I very much welcome this; as you imply, Chairman, this is a matter for parliaments not primarily a matter for governments, but I think that, your point, this should not just be done on a whip basis, there should be genuine parliamentary scrutiny and decision over it. And, if I may, I think there is plenty of time to do this, it is not a question of a decision we have to make in the next few months, because we will see what the final outcome is, then there will be the IGC, Parliament will have a chance to consider it, and it will take many years before it is ratified and comes into force. But I would very much welcome this House giving serious consideration not just in this respect but how European policy and legislation is treated across the board, because I do not think we take it seriously enough, speaking personally.

Mr Chidgey

Secretary of State, can I bring you back to the timing of the completion of the Convention and then the following IGC. I think you said earlier, when you started giving evidence, you confirmed that the Convention was due to complete its work this June. I understand that would be followed then by a period of reflection before discussion of the Convention's findings at the IGC in the following year, during the Irish and the German Presidencies of the Union. But it does appear, Secretary of State, that there are some competing concerns that have arisen which do put question-marks on the timetable, which I would like to pursue with you, if I may. For example, Giscard d'Estaing and some other members of the Convention have already argued that they cannot finish their work by June and need more time, the Italians and some other Member States see no reason for a long period of reflection and would like to see the IGC completed during the Italian Presidency, leading no doubt to a new Treaty of Rome, and then we have the fact that the IGC in 2004, if that was the time, could well face complications arising from the European Parliament elections in the May of that year. So, all in all, there seems to be quite a host of competing complications here. I recall, Secretary of State, that recently in a debate in Westminster Hall you yourself said that the June deadline has been a spur to progress in the Convention, so you see no sense in delaying the conclusion of the Convention itself, and you would not want simply, at the end of the day, just to rubber-stamp the Convention's work, so clearly you want time in the IGC. So, all in all, do you believe that it is right, under the present circumstances, that we should be in a situation where a new treaty could be agreed at the IGC before the anticipated enlargement to 25 nations takes place; should not that agreement wait until their full succession, so they are part of what is going to be a very significant treaty?

(Mr Hain) If I pick up your last point first, there is no question that the new Member States should be excluded from the decision-making process, it is going to be their European Union just as much as it is ours, so they have to be in the IGC in some form or other, either as fully, legally Member States or, as it were, a de facto part of the IGC. There is an aspiration from Italy to have another Treaty of Rome, but that would be December, and if we stick to the deadline, as we are determined to do, and want to see, of the end of June, because I think that otherwise a kind of Parkinson's Law syndrome takes over here that will keep me there for ever.

So do you view this as a Treaty of Rome, a Treaty of Dublin or a Treaty of Berlin?

(Mr Hain) We will have to see about that. Some people might think it is a good idea to keep me there for ever, but I cannot see that happening, Chairman. But I think what is likely to happen is that the report will be made to a Special European Council on June 30, unless there is some sort of major disruption of that timetable, then there will be a period of reflection, including I hope by national parliaments, and then the IGC process will start some time in the autumn or early winter. So it could well start under the Italian Presidency, and I think there is a lot to be said for that; whether it will be completed under the Italian Presidency who knows, I would have thought that is unlikely, and so it is more likely to be the case that it will be completed under the Irish Presidency, I would have thought, as we are seeing things unfold at the present time. But really it depends on how possible it is to get a consensus at each of these different stages.

How have you coped with your responsibilities as the UK Government's Representative to the Convention and the Secretary of State for Wales?

(Mr Hain) By getting less sleep.

Will you be the Government's representative at the IGC?

(Mr Hain) No; not as far as I know.

Mr Illsley

Will you be invited to be?

(Mr Hain) No; that will probably fall to the Minister for Europe, I would have thought.

Mr Chidgey: I see. That is very interesting, very helpful. It is actually very refreshing to get such a direct answer.

Chairman: I would like to move on now to the external action and defence; Mr Chidgey to begin, please.

Mr Chidgey

Secretary of State, do you see the report of the Working Group on External Action as a sensible basis for discussion on this issue? To what extent does it reflect the UK's contribution to that Group?

(Mr Hain) Yes, I do see it as a sensible basis, but then perhaps I would do since I was on the Group and helped to achieve the consensus there. I think we were very clear, it comes through very clearly through the Group's report and its endorsement by the Convention, that Common Foreign and Security Policy is a matter for governments, that it will not be communitised, that unanimity is the principle by which a CFSP operates, and those essential principles are ones that we argued for strongly, with a lot of support, and achieved.

When the Working Group presented its final report in December, I believe that you yourself expressed concern over the practical implications of 'double-hatting' the High Representative role.

(Mr Hain) Indeed.

Can you tell the Committee how this proposal has evolved since then; do you remain concerned that it is a back-door attempt to communitise the CFSP?

(Mr Hain) It could be, and some members of the Convention have that ambition, European Parliamentarians in particular, because that would give them an arm-lock on Common Foreign and Security Policy; but that is not going to be the outcome.

Will it go down to a veto at the IGC, in Britain?

(Mr Hain) If there was any threat to Common Foreign and Security Policy being the propriety of governments, yes, then that would put us in veto territory, but we would not be alone, France would be alongside us, Spain and many, many other countries. But, on the question of double-hatting, this is the merging of the High Representative and the External Commissioner roles, as it were, Javier Solana and Chris Patten, in current sort of positioning, I did express concerns, because I thought the proposal was not thought through. There is a great logic to better co-ordination, and on the one hand giving the Solana figure access to the Commission's resources, and on the other bringing in the Commission's external relations work, which is crucial, the overseas aid and development budgets and the association agreements' work, and so forth, under the High Representative too. I think there is a great logic to that, but the detail has not been negotiated or thought through. So I think that we would have to ensure that the new single person, the double-hatted individual, the new High Representative, was appointed by and under the control of the Council, that the Council was the master, rather than the College of Commissioners. There is then an issue and a discussion and a negotiation to be had as to could the new High Representative, for example, sit in the Commission and have his, or her, voice part of the Commission's debate, without being subject to Commissioner College decisions, and, therefore, as it were, a back-door communitisation of foreign policy. We are concerned about that, the French are concerned about that, the Spanish are concerned about that, as are very many others, and until we get to a position where we can negotiate really strong barriers to communitisation in that form then we will not be in a position even to get towards thinking whether we can agree this proposal, and nor would, I suspect, the Convention veto itself on the issue, let alone requiring any Member States to do so.

Mr Illsley

Just to follow on from that, Chairman; given the stature of this individual, who will have this new office, this merged role, and obviously it is going to be someone with considerable stature, and given the fact that the Working Group went on to suggest that there should be a European External Action Service, which could suggest the whole Civil Service, I think, representatives behind this particular individual, it would just seem to be difficult to stop some communitisation of the central foreign policy by that individual, given the stature of the resources that are going to be available to them, probably?

(Mr Hain) I understand the concern, but let us look at what happens at the present time.

Do you agree that there should be that Civil Service aspect behind this enhanced Action Service?

(Mr Hain) If I can explain how I come to the position that we have. Javier Solana explained in exasperation to the Working Group that he did not have the resources even to get a vehicle, if I recall, a four-wheel-drive vehicle, into Bosnia, where the EU had a peace-keeping capability, or Kosovo, it might have been, because it did not have the resources; so he actually had to go to a car manufacturer and persuade them to donate it. Now this is a European Union which is supposed to have a Common Foreign and Security Policy that is operational; well, clearly, this is ludicrous. Equally, he has explained how if he went to New York, for example, or Washington, the Commission officials there were unable to assist him, because they were serving the Commission, or provide him with even the elementary resources that his job needed. So he has been an incredibly effective operator and influential figure by his sheer ability and drive and persuasiveness, but he has got no resources at all; so we want to see that newly-constructed figure have the resources. Now the issue is, do you have a whole kind of European embassy sort of structure, which is I think what concerns you; and, no, the External Action Working Group did not propose that, it said there should be European Union delegations alongside those of Member States. And, of course, the Commission already has 138 bilateral and five multilateral Commission delegations overseas, that is to say, staff overseas, so the issue actually is to make sensible use of these people on behalf of the Council and its representative, its foreign policy external relations representative, rather than leaving that individual without any serious resource base.

I was just thinking that is probably another argument that we are going to have to contend with later this year, or next, or whatever; is there going to be an argument as to whether the new officer, the new office, should have more resources than perhaps Javier Solana has had in the past, is it going to come down to an argument on, purely and simply, financing?

(Mr Hain) I do not think so, no, because the Commission itself has plenty of resources, the issue is that the Council, through its foreign policy representative, has not had access to those, creating the sort of ridiculous situations that I have described, and acting as a barrier to any effective implementation of European influence abroad.

Sir John Stanley

Secretary of State, can you tell us the Government's view of the proposal to establish a European Armaments and Strategic Research Agency?

(Mr Hain) Yes, I can. We are not in favour of some kind of centralised procurement agency, obviously, but we are in favour of a flexible agency that develops on the good practice that there has been in existing mechanisms, such as OCCAR, WEAG, and the Letter of Intent, LoI; we would need very strict entry criteria for participation and more technically difficult forms of co-operation, such as joint procurement, if those were to be considered and if the whole idea were to be successful. But we came to quite a good agreement, in fact, negotiated principally with the French in the Convention, and it is a matter of seeing whether we can translate that into constitutional text in a way that satisfies us.

Can you assure the Committee that the Government will resist any introduction through this particular mechanism of an obligation on our Armed Services to procure European in all available circumstances?

(Mr Hain) Yes; that was a point of resistance, a very important point of resistance, precisely to that proposition. Ironically, the proposition was often put by countries that had virtually no proper defence forces themselves, in the debate; which is one of the ironic features of this discussion, that some of the countries that seem most anxious to communitise not just foreign policy but defence policy actually cannot put any soldiers in the field that count anywhere.

Chairman

Do they want to centre their GDP on defence?

(Mr Hain) Indeed; they seem to think - anyway, I have said what I wanted to say.

Sir John Stanley

I hasten to say, Secretary of State, we have had some successful collaborative projects with European Member States in the defence field, but also we have absolutely critically important collaborative projects with the United States, and, given the lead of the United States in so many military technology areas, it would be unthinkable for our Armed Forces to be locked into this process in some form by European policy?

(Mr Hain) I agree, Sir John, and you will be very happy that that position is being adhered to very firmly in the Convention process.

Chairman

The interesting one; the Defence Working Group's report, Secretary of State, made various suggestions. At the plenary session, you said those suggestions represented the "limit" of the UK's ambitions in this area. So which of the recommendations of the Working Group are within those limits, which are without?

(Mr Hain) I think they are all within the limits, but we have negotiated a consensus on that, within that Group, and we have resisted others taking us beyond our limits.

Mr Olner

Given that the weaknesses that the Working Group recognised in much of the European defence expenditure, and you yourself, Peter, have alluded to it as well, by some companies, do you think this suggestion of a European Armaments and Strategic Research Agency would help, or would that be just another talking shop?

(Mr Hain) I think it would help, because there would be increased co-operation on armaments, we would be able to look more analytically at spending on capabilities, which is the weakness that many other Member States have, and we look at ways of spending more effectively and exploit synergies to give the European Security and Defence Policy the tools that it needs. Also, as part of the Working Group recommendations, for example, we wanted to update the Petersberg Tasks to make them more relevant to some of the challenges we face today than when they were drafted originally.

Andrew Mackinlay

I suppose one of the things which we have not uttered this afternoon with you in this context is the recent painful experience we have had in relation to getting an agreement amongst European Union partners on Iraq. And really has that rather traumatic, bruising experience altered in any way your thinking as to how either realistic or how fast we can go in this ambition, a perfectly legitimate one, of trying to secure a Common Foreign and Security Policy and collaboration on defence? It seems to me that those of us who actually do see this as an attractive proposition, as an ideal, nevertheless, have to acknowledge that recent weeks have left that concept somewhat bruised, I think: discuss?

(Mr Hain) First of all, there is the issue as to how has the debate on Iraq within the European Union affected current European Security and Defence Policy initiatives, and really it has not affected it at all. There have been differences in both the European Union and in NATO, but that has not prevented rapid progress in the last two months to complete the NATO/EU Permanent Arrangements, and the decision that a European Union military mission should take over from NATO in Macedonia, that has gone ahead. And the ESDP mission takeover in Macedonia is a very significant and welcome evolution in Europe's capability for external action, and also in NATO-EU relations; so that has not affected it at all. I think it is important, too, just to recognise that five others of the existing Member States backed the position that Britain has taken over Iraq, so it is six in total out of the existing Member States; now that is a minority but it is a very substantial minority, a very substantial one anyway. And, within the new Europe, 14 of the 25 Member States, a clear majority, have backed what we are doing in Iraq. So the idea that Britain is isolated in Europe, or that the development of a sensible Common Foreign and Security Policy will become impossible in Europe, I just do not think holds. I think that we remain a leading European power, a very influential one, we have a lot of support, even on the very, very difficult issue of Iraq, as those figures show, and despite the differences that there have been.

Chairman

Secretary of State, one final question on the parliamentary dimension of control of CFSP and ESDP. You know there has been a substantial debate on this, the starting-point is that foreign policy, defence policy, essentially is a matter for national governments and national parliaments; the European Parliament has its role, particularly in respect of aid policy, and in respect of civilian emergencies, and so on. But there is an area in-between when there are integrated operations by the European Union, which could include defence matters, as we have now, I think it is today, is it not, that the Macedonia operation is starting?

(Mr Hain) I believe so, yes.

Then we can move on to Bosnia, with the British/French initiative of an EU defence operation in Bosnia, integration which could include aid, which could include civilian administration. So do you accept that somewhere between the role of national parliaments and the European Parliament there is a lacuna, there is an area which has not yet been filled by any form of parliamentary oversight, and should be?

(Mr Hain) I would certainly be very interested to see any proposals that your Committee made, Chairman, on this area. Can I make just one point of principle, first. The difference between our view of Common Foreign and Security Policy and that of many other countries is that we see it has been a continuum between, if you like, the soft end, aid and trade, to some extent, and the hard end, soldiers; and if your foreign policy fails your soldiers have to pick up the pieces and your aid policy has to bear the burden thereafter. So I think we have to look at CFSP in terms of a continuous thread, rather than box off bits of it, in a way that some, for example, have said, "Well, foreign policy should be communitised, but keep defence policy under unanimity." Well that just is not acceptable. But there are all sorts of contradictions. I noticed, for example, that the European Parliament was able to block what I think was _70 million of aid - you may remember, Kim - to Afghanistan for many months, in the reconstruction of Afghanistan, which is an outrageous decision of the European Parliament, not actually because they did not want the money spent there, but because they were embroiled in some other argument with the Commission and the Council over the way the budget was spent. Now we have got to have a situation where, if Europe decides to do something like contribute to the rebuilding of Afghanistan or, as we intend, the redevelopment of Iraq after decades of Saddam's murderous rule, this sort of playing around by the European Parliament could not obstruct us.

Then do you see the need for the creation of a new institution to bring together the European Parliament and national parliaments in this field?

(Mr Hain) We are not very keen on new institutions at the European level. President Giscard d'Estaing and others have suggested this idea of a Congress, which could do precisely that, bring together European and national parliamentary representatives. Nobody has really fleshed out this idea and said what role it would play, does it have any electoral role, how often would it meet, and so on, and until somebody has sketched that out, in a sensible and a coherent fashion, we are not really in a position to take a judgment on it.

And we will not contribute to the debate?

(Mr Hain) We will contribute to the debate by asking questions, as I have asked already, but it is not in our prospectus, and until somebody produces a convincing proposition it will not be in our prospectus.

So the Committee, and indeed you, will be asking questions?

(Mr Hain) Yes, and if the Committee has any wisdom to offer on this I would gladly read it.

Chairman: Secretary of State, you have been helpful, the debate will continue. May I thank you, and Mr Darroch will be coming for the second session. The first session is now concluded. Thank you.