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UNCORRECTED TRANSCRIPT OF ORAL EVIDENCE To be published as HC 155-i House of COMMONS MINUTES OF EVIDENCE TAKEN BEFORE EUROPEAN SCRUTINY COMMITTEE
THE BRUSSELS EUROPEAN COUNCIL ON 12 AND 13 DECEMBER
Wednesday 17 December 2003 MR D MACSHANE, MR D FROST, MR T BARROW, MR P JOHNSTON Evidence heard in Public Questions 1 - 50
USE OF THE TRANSCRIPT
Oral Evidence Taken before the European Scrutiny Committee on Wednesday 17 December 2003 Members present Mr Jimmy Hood, in the Chair Mr Richard Bacon Mr William Cash Mr Michael Connarty Mr Wayne David Mr Terry Davis Jim Dobbin Mr David Heathcote-Amory Mr Mark Hendrick Mr Jim Marshall Mr Anthony Steen Mr Bill Tynan ________________ Witnesses: MR DENIS MACSHANE, a Member of the House, Minister for Europe, MR DAVID FROST, Head of EU Internal, MR TIM BARROW, Assistant Director, EU External, and MR PAUL JOHNSTON, Head of Security Policy Department, Foreign and Commonwealth Office, examined. Q1 Chairman: Minister, welcome to the European Scrutiny Committee yet again. It is good to have you and your colleagues here. The IGC broke down last week. Was it just because of the voting system? Mr MacShane: Principally, yes. There were positions that could not be bridged. They have been reported in the papers: France and Germany broadly on one side; Spain and Poland on the other. We tried to build those bridges but we did not succeed. That was the proximate cause of the fact that we did not agree this weekend. Q2 Chairman: We were all watching it on the television. I did not see many sad faces on our government's side. Where do we go from here? Mr MacShane: We will wait for the Irish presidency to start. The Foreign Secretary was in Dublin yesterday and I have taken the liberty of bringing his speech with me. The Irish presidency will take soundings and report to the European Council in March and we will get an inkling there. We may see developments earlier next year amongst the principal countries that were disagreeing on the voting weights, though I have to say from reading some of the continental press and from the reports of our ambassadors I do not sense a great shift of where people were as of last Friday and Saturday. Q3 Mr Marshall: Maybe I can ask the question overtly which the Chair is clearly seeking to ask you covertly. Is Britain unhappy with the outcome of the IGC? Mr MacShane: The British government would have liked to have a satisfactory constitutional treaty. There was a lot in it, as the Prime Minister made clear in his statement to the House on Monday, which we warmly support. We were very much in the lead in putting that forward. To take one specific example, an increased role for national parliaments. A second one would have been a standing chair of the Council of Ministers which in a sense is a council of nations which we think would have given greater equilibrium vis a vis the Commission president and clearer leadership to the work of the Council; and an end to the six month rotating presidency which were 25 Member States - we hope more - which will mean probably only five or six times a century does a country hold the presidency of the European Union. There were some good things in there that we would like to have seen but as we said in paragraph 26 of the White Paper published on 9 September and, as the Foreign Secretary, the Prime Minister and myself have made clear, the European Union does not stop. The treaties of Nice, Amsterdam, Maastricht, the existing rules, the constitution, if you like, of the European Union is there in place in any event. Some of the issues that would have been decided at the IGC would not even have come into play until 2009. Q4 Mr Connarty: On the question of the voting weights, the Minister will recall coming back from Nice and the government telling us that Nice was the contract with the new accession countries, that we would bring them in. It was all very sensible. Many countries went to a referendum on that issue, some, like Ireland, twice, but it was sold on the basis of the Nice formula. We have been in Poland and talked to the Polish government. Is it not reasonable that a country like Poland, who struck a deal at Nice and put it to the people, should not be expected after another process that is not a treaty process to change their mind and to betray the trust that their people put in them in the referendum? Is that not an unreasonable thing for people to try to do and was it not inevitable that they would stand firm on that, as presumably we would if we ever had a referendum on a similar issue? Mr MacShane: I think we need to get a time line into this. Very soon after the Nice Treaty was signed, it became evident that may governments in Europe were unhappy with aspects of it and did not feel that it was adequate to handle enlargement and future enlargements as successfully as one would wish. Hence, the decision at Laeken to set up the convention process and where we got to this weekend. I have been in Poland a lot. I must in all honesty report to the Committee that I did not get a sense in Poland, before the convention text was put to the peoples of Europe in June and July this year, that the issue of voting rights was of huge importance. Looking at the referendum debate in Poland, I did not sense that this was a major issue. It was by contrast for the Spanish. My Spanish opposite numbers from day one have said, "We want to stick to Nice. We want to assure our weight." When the constitutional treaty draft was put forward by Mr Giscard D'Estaing, it was at that point onwards that the Poles became extremely concerned. I am adamantine on this issue. That has always been accepted by this government. We said in the White Paper we are content with Nice. We are also content with the convention proposals. We had hoped that a compromise might be possible but that was not the case. Q5 Mr David: It has been suggested in the press and elsewhere that, quietly, the reality was that Britain was quite supportive of Poland. Mr MacShane: We have the warmest of relations with the Poles and with the Spanish, the French and the Germans. We have said publicly - the Prime Minister said it on Monday but repeating what he said previously - yes, you have to accept the reality of the Polish political position. They were where they were, as it were. It is difficult for the Polish Prime Minister to return having come with a very clear red line, just as it would have been for us. Equally though, my last conversation with Mr Fischer was ten days before the convention in Naples and he said, "Please convey back to your government that for us the convention voting arrangement is our red line. We are happy to talk about all the other issues, but it is of fundamental importance to us", so two red lines that clashed. We will just have to examine this, or the Irish presidency will, and see whether we come back to the negotiating table in the immediate future. Q6 Mr Heathcote-Amory: In the Prime Minister's statement on Monday, he implied that all British positions had been secured. When I asked him whether this was in writing and would be reflected in any revised text, he did not give a very clear answer. It has been reported to us that there was very little discussion on the other issues, apart from defence and the voting issue. Which, if all, of the red line issues we have have been secured in the negotiation before the breakdown and is this in writing? The Prime Minister referred to 82 measures which had been agreed but perhaps you can enlighten us and be very clear and specific about whether the agreement is in writing and therefore reflected in any revised text, if it is tabled. Mr MacShane: The reference to the 82 points which were near consensus was the Prime Minister quoting verbatim what Mr Berlusconi, as president of the European Council, said in the conclusion of the Council meeting on Saturday afternoon. Mr Berlusconi was basing himself on a presidency document issued, if memory serves me right, on 24 October, which outlined the areas where consensus had been arrived at. Mr Berlusconi also in that same statement said that countries agreed that unanimity should be maintained in areas like taxation, social security and the financing of the EU. That is his statement as president. We do not have any written text from the discussions on Friday and Saturday because those were all in the firm of bilaterals or full plenary sessions or tri or quadrilaterals. Any finished text would have been produced on the basis of the entire treaty being settled. We never got to that point but there, in front of 24 other heads of government, Mr Berlusconi on behalf of the presidency of the Council made those references to unanimity. We believe that it is reasonable for Britain to say that those should be banked and we will not return to that if we restart negotiations shortly. To give Mr Heathcote-Amory a direct answer, there is not in writing anything that is a European IGC conclusion from Friday or Saturday and, to quote the Prime Minister and the Foreign Secretary, nothing is agreed until everything is agreed. Were we to start the talks again in the near future, we would certainly be saying to our Irish friends - and they share our view on taxation 100 per cent - that the presidency statement at the end of the talks at about two or three o'clock Saturday afternoon should now be the starting point for the reopening of any discussions. Q7 Mr Tynan: You have made a point as regards the breakdown of the talks and the fact that we do not have a constitution agreed, but there will be an opportunity as regards the next presidency in Ireland. There is a feeling that the further presidency may be an opportunity, the one after the Irish one, and we may have to wait that long. If you were a betting man, do you believe that we are going to arrive at a conclusion that will lead to a constitution for the European Union? Mr MacShane: My grandfather, God rest his soul, apparently did terrible things with parts of the family finance through betting a long time ago, so I have foresworn that pleasure. I did place a bet on who would become Mayor of London and lost but that is another story. We have a constitution for Europe in the sense of constitutional treaties that provide very clear rules. Honourable Members yesterday in the House of Commons were animadverting about the term "ever closer union" and the fact that it had been replaced by language about Europe united. Now, ever closer union remains in the treaties which govern how we take Europe forward. We have strong rules covering all aspects of the European Union which together form a set of constitutional treaties which we honour and abide by. I still believe that there was much that was on offer from the convention text which was of high importance, certainly for Britain's vision of Europe. I have alluded to some aspects of it which will be worth having. Whether the hunger is there immediately to start renegotiating, I do not know. I just have to report that. We are all pausing. We are taking stock. It is a period of reflection. I think that is very much the Foreign Secretary's phrase from his speech in Dublin yesterday. I am not ducking the question but I would feel in a much stronger position to answer that in a future scrutiny hearing of this Committee some time into the new year. Q8 Mr Cash: I would like to look below the camouflage of the voting weights question because the question of how it was that they came to be given what others regarded as a disproportionate number of votes has a lot to do with the problems that Poland has in other areas, such as the 25 per cent subsidies that they were offered. The government in Poland quite clearly had to come back with something; otherwise, they would never have got the referendum through, which is why I raised this with the Prime Minister yesterday. The problem has been made somewhat worse, I would suggest, by the fact that it appears that the United Kingdom has gone along with this restriction on the budget itself, which is going to have a knock-on effect as far as Poland is concerned. They cannot understand why the United Kingdom has made itself a party to this disreputable attack on Poland and the other countries. Would it not be fair to say that the real question here is that there is a serious divergence of view, quite apart from what the Prime Minister said yesterday in suggesting it was just about voting weights, and that the real reason why Poland took the line they did was because they were deeply disillusioned by the manner in which they were being treated? Mr MacShane: I have some interest and knowledge of Polish politics. I find that there is a refreshing enthusiasm about being an active, full, hearty European Union member that I wish might infect certain quarters, even in my own country. Poland was ready to sign up, to my knowledge, to most other parts of the constitutional treaty as we were, but it became a fundamental point of national importance to Poland to maintain the voting weight it was accorded in the Nice Treaty. The common letter from six EU heads of government on the European Union budget I think reflects a commitment to very sound, small 'c' conservative budgetary thinking, that the European Union should not be profligate. As you know, Europe can spend up to 1.27 per cent of EU GDP. At the moment, we are spending far less than that. Let me inform the Committee because there has been considerable confusion in the press. This letter was drafted and signed prior to the summit meeting last weekend, so it is not a consequence of the summit breakdown. Q9 Mr Cash: Do you think it might have been the cause? Mr MacShane: The notion that a letter that is not published can in any way affect ---- Q10 Mr Cash: They may not even tell you. Mr MacShane: Normally, you send a letter to the Commission. It is presented to the Commission. You agree it; you sign it; you send it. The date of its receipt is a matter separate from the decision to send it. The basic point is that, if we are asking a number of European countries to cut public expenditure, they are in a difficult position then if they are expected to increase public expenditure in the sense of transfers to Brussels. The important thing, it seems to me - and this was very well set out by the Foreign Secretary' speech yesterday and it is a point I have incessantly made as Europe Minister - is that we need to get European growth and job creation going again. That will increase the fiscal receipts by definition to Brussels. One per cent of nine trillion euros is a lot more than one per cent of the current eight plus trillion euros. The money is available then to the accession states. To finish this point, Poland is receiving, as are the other accession states, between 2.5 and 3 per cent of GDP in help from Europe. It is generous. Absorbing it, as we see with objective 1(1)(e) with our own country, may pose problems. Spain does face, with the freezing of the common agricultural policy spending and the discussion about the reallocation of structural, regional funds, quite a considerable set of difficult political issues ahead for the Spanish government. Spain and Poland are not really in the same camp with regard to this, but I am very happy that a variety of governments from different perspectives, some taking quite different positions on Friday and Saturday, nonetheless are saying that the budget of the European Union should be exercised in a very prudent manner. Q11 Mr Davis: To be fair to the Poles, would you have expected them to make an issue of voting weights before the convention proposed a change in what had previously been agreed? Mr MacShane: The issue of how you take decisions in Europe has become of high importance, particularly since the Amsterdam and Nice Treaties. There has been out there a constant argument that the so-called double majority makes the most sense. In all systems of governance, how do you allocate votes? California and Vermont have two senators each. Bremen, with a population of not even a few hundred thousand, has the same number of senators as North Rhine Westphalia. This is in the German Bundesvaht. The issue becomes difficult when you have one country that is more than twice the size of Poland and Spain and has 30 per cent more substantial population than the UK or France, namely Germany. As Otto Schilly, the Interior Minister, put to me - I do not think it is a conversation he would wish to keep private - if every country of a few hundred thousand was going to have a commissioner then maybe every German Lande should have a commissioner. He was joking, I hope, but these issues are out there and they are serious ones. I hope I bend over backwards to understand and support friends in Poland but certainly from the summer holidays onwards it was absolutely clear that that was a Polish position. I regret that perhaps more accommodation was not made, but I also have to report that there are other countries absolutely clear that the conventional voting system should be maintained. Q12 Mr Davis: You seemed to be expressing some surprise that the Poles had not made an issue of voting weights until they did, unlike the Spanish. Why was it a mistake for the Poles to think that something that was agreed as recently as Nice should be cancelled or changed? I understand your point about population sizes, but they have not changed since Nice. All these factors were known at the time of the Nice agreement. Why should not the Poles believe that what is agreed is agreed? Mr MacShane: That is a very fair point but in that case why did we start the convention at all? Why did we have the Laeken declaration? Why did all of Europe, from whatever perspectives they come from, launch this process? I was not Minister for Europe at the time. There were Members of this Committee here who were. I am not sure if the Committee raised its voice in protest and said, "We are quite happy with Nice and see no need to change anything." The convention process got underway and I certainly bow to the right honourable gentleman for Wells who was there extremely diligently. It is not for me to ask a Member of the Committee, but he might be able to help us in saying whether the Polish representatives at it really made this an issue in the way that I think British government representatives and parliamentarians made our so-called red lines pretty well known. My impression is - and I am not criticising anybody - I think it was rather difficult for the ten accession countries to operate in the convention process with quite the same authority as existing EU Member States. I am sure it was raised by Mrs Hoodner who is an outstanding Polish European but I am only making the point that I was at Thessaloniki and no one was coming up to me saying, "This is absolutely unacceptable. You must tell the Prime Minister that the recommendations on double majority are absolutely out of order." It became clear they were unacceptable. The Spanish had always made it clear. I am not complaining about this but I think it stresses the point that a number of us are making that the future construction of Europe will need cards much more clearly on the table and positions taken. I think we did that through the White Paper that was published. Everybody knew. The parliamentary document was properly discussed in the House of Commons. There was the British position and that is where we would stand. Q13 Mr Bacon: You said that, while technically nothing was agreed until everything was agreed, nonetheless it made sense to bank the stuff that had been agreed on if possible. I take it that this is the negotiating acquis that the presidency referred to, the stuff that has been banked? Is that right? Mr MacShane: We do the banking in a sense. I do not want to go too deeply into another round of European images and metaphors. Q14 Mr Bacon: It is really a point of clarification before I ask my question: what is the negotiating acquis? Is it these 82 points that have been banked? Mr MacShane: The 82 points of consensus were in a presidency document. There is no draft treaty, as such. There is the Giscard Convention text, the draft of the constitutional treaty. There are then a series of presidency conclusions and papers, all of which are published as open documents, but nothing is spatchcocked together in the formal sense that we have an amended treaty and then a composite motion where you come back and amend a bit more of it. At the last intervention by the President, Mr Berlusconi, on Saturday afternoon, he made the references to unanimity in the areas that are certainly of important concern to the UK and a number of other countries. We are publicly saying, "We are banking these and when and if the IGC talks resume we do not expect all of that to be reopened", but - this is my caveat and I am sorry to have to repeat it - nothing is finally agreed until we have, if we have, a final constitutional treaty. Q15 Mr Bacon: What you are saying is that this phrase here in the presidency statement, a text supported by a large majority of Member States which will henceforward be considered as a negotiating acquis not open to further discussion, is the thing that you just referred to that Mr Berlusconi was talking about. Mr MacShane: Have you the date for that particular statement? Q16 Mr Bacon: This is the declaration of the Presidency found at the presidency conclusions, page 30. Mr MacShane: These are the presidency conclusions that were published at different times. As each succeeding negotiation took place, the presidency would say, "Here is where we are today" and what Mr Berlusconi is saying is that those are positions where we have reached consensus. Q17 Mr Bacon: This is a text, so there is a text. Mr MacShane: Yes, but the texts are already circulated in the Commons library. Q18 Mr Bacon: What I am trying to get to is this: are all Britain's red lines covered within what you call the banked stuff, the negotiating acquis, or are there some of them that are outside it? Mr MacShane: The presidency conclusions, as they were published during the autumn, did not cover for example our wish to seek unanimity on tax and other areas. Those were contained in Mr Berlusconi's oral declaration made to his fellow heads of government at the end of the Council meeting on Saturday afternoon. Q19 Mr Bacon: This is dated 12 and 13 December and it says, "This difficult work resulted in a text supported by a large majority of Member States." I am simply trying to establish what that text says and whether Britain's red lines are covered in it. Mr MacShane: The text ---- Q20 Mr Bacon: There is not a text? Mr MacShane: There is a text. Q21 Mr Bacon: What does it say? Mr MacShane: I defer to advisers here. They are in the library of the Commons and they are on the websites. There are several texts. There is a convention text; there are the different packages that were published after all the conclaves at IGC negotiating sessions during October and November principally, and then there is Mr Berlusconi's summing up which you have just read from. Q22 Mr Bacon: Mr Berlusconi summing up, the "Declaration of the President", refers to a text. You sound like you are saying that the negotiating acquis is not one text at all but a whole load of different texts from different Member States. Which of those is right? The first or the second? It says that it is not open to further discussion. Mr MacShane: I have to go by what the President said. Q23 Mr Bacon: That is what I am trying to do too. Mr MacShane: I think it is a perfectly fair question. We may need some clarification on that. My firm understanding is that we do not have an amended treaty. We do not have a treaty as of Saturday afternoon. We have texts in the plural. I am not sure whether the Italian noun covers singular and plural. They consist of the convention, the different presidency declarations in the course of the IGC discussions and of course Mr Berlusconi's final statement itself. There is not a single text, in the singular. Q24 Mr Bacon: What you are saying is really that you are taking all the different texts of the different Member States, their different negotiating positions, you put them in a large sack and that is what Mr Berlusconi is referring to. Mr MacShane: No. We are talking about presidency declarations that were issued, for example, on the pasarelle clause, that went. The single initiative council went. There were other issues that were contentious that were dealt with through negotiation but we do not have a final text that incorporates ---- Q25 Mr Bacon: It does say here, "not open to further discussion". Mr MacShane: The difficulty there is that that was Mr Berlusconi's statement as translated into English. I have tried to explain several times what my understanding is. I do not think it is a secret or unknown text. The only things in writing are the convention draft, the presidency declarations as produced after the different IGC negotiating sessions and this. I am happy to write to the Committee to clarify this. Mr Bacon: That would be very helpful. Q26 Chairman: The Prime Minister said in his statement that he was assuming that things were banked, inferring that it was agreed. Then, when the IGC reconvenes to discuss a future treaty, the outstanding issues that have not been dealt with need to be dealt with. That is not set in concrete because once they open up the negotiations again everything is up for negotiation. Some of the red lines that we had agreement on will have to be re-agreed when we go through that process. Mr MacShane: That is why we have used this concept of banking. We assume that, if the presidency of the European Council makes a declaration in front of 24 other heads of government and states that there is agreement on unanimity in this or that area, that is de facto a bankable decision of the entire Council. I have taken part in Council meetings and if the presidency says something I do not like I raise my hand, one against 24, and say, "This is unacceptable to the UK. I must ask you to come back and think again." That did not happen, as I understand it. I was not physically present there; it was just the PM. You are equally right, Chairman, in that when the IGC resumes its negotiations, if it does, nothing is agreed until everything is agreed. Anybody can reopen almost anything, but I do think it is slightly unrealistic, having been through the discussions and negotiations we have been through in the last 20-plus month, the President having made the statement he did, that a sensible person would start knocking on the door, saying, "We want to ignore all of that, ignore what the presidency announced and what 24 other heads of government gave consent to and reopen these issues." Theoretically, that could happen. Q27 Mr Connarty: One of the two issues that were of concern was the pasarelle clause. What has been banked on that because we were not sure when we saw the draft, when I was in Rome and we had the presidency's draft. It could be rejected or accepted by X countries. It did not state what X was. Is X one country or a number of countries? The second is what have we banked on energy? We seemed to completely lose it and the presidency proposal was not acceptable to the UK. We then put amendments down. What did we bank on that issue? Mr MacShane: As far as energy is concerned, in effect, there is no change on existing arrangements. What we succeeded in doing was getting language that we put forward with the help of our Dutch colleagues that certainly satisfied the energy industry. I could find the exact words if you want. Q28 Mr Connarty: The Committee has seen the words. Mr MacShane: That is a presidency declaration. The presidency declaration puts into writing what everybody formally agrees. We did not get that far on Friday and Saturday because it stopped where it stopped. On the pasarelle clause, there is now clear language that says if the national parliament makes known its opposition within six months of notification of a change, a European decision shall not be adopted. One parliament can knock it out so in effect it gives each parliament a veto which is why I say I welcome some of the developments that in my view were leading to a strengthening of the authority of national parliaments. That I am able to read in quotes because it is a formal presidency declaration, so we have it in writing. Q29 Mr David: On the issue of national parliaments, that is something new which I personally welcome. Some people have suggested that one of the things that has become evident over the last few weeks is that perhaps the mood in Europe is somewhat different than members of the convention took it to be. It was said therefore that this hiatus that we have, this period of reflection, gives us a chance not only to bank what we have but also maybe to think about some new ideas, like increasing the role of national parliaments. Reflecting this new mood, perhaps we ought to look at the issue of subsidiarity again more closely and perhaps introduce in partnership with other states new suggestions about how that subsidiarity principle could be made more real. Would the British government support such a move? Mr MacShane: Yes. We feel very strongly that one of the lessons from the whole process is that you cannot build the European Union against a nation state. It has to add clear value to what a nation state does just as nation stages are hugely strengthened by pooling parts of their sovereign power in partnership under a constitutional treaty with other countries. I feel very strongly that we, as the oldest Parliament in Europe, should be taking a lead on seeing how we can build parliamentary scrutiny into European decision making. As you know, a constitutional precedent was set on the initiative of the Foreign Secretary. A standing committee was created to hold hearings while the IGC was taking place. I think I am right in saying that in no previous treaty negotiations has the parliament created a standing committee to which negotiators were accountable and had to report. We are very grateful for the raising of the energy issue, which emerged through that process. I regret that there was not a great level of participation, though I salute honourable members who did diligently turn up to that committee. I think you may need to look at a version of that for continuing its work. You and I have had discussions, Mr Chairman, about the possibility of more scrutiny committee meetings taking place either in other capitals or in Brussels itself, with commissioners having to be accountable, the need to build links with other parliaments and national assemblies. An awful lot of what happens in Europe does not start in Brussels. It starts in London, Paris or Berlin or wherever and the best legislation is that which you are there at the beginning of to shape, rather than reacting when it is already a done deal. This will mean almost a revolution in the way we do some of our business. What is sauce for the Westminster goose is sauce for 24 other parliaments' gander in that they will also ask that commissioners be accountable to them and might want to exercise oversight or even veto rights on issues which may be of high importance to us. The main thrust of your question is absolutely right. The one lesson I have from being a little more than a year in office as Europe Minister and coinciding with the second half of the convention and the IGC is that Europe ignores national parliaments and national wills at its peril. Q30 Mr David: You would be favourably disposed towards any suggestion that might be made to strengthen the draft constitutional treaty by having greater powers for national parliaments included? Mr MacShane: There are two separate issues. We always wanted what was colloquially known as a red card system but we failed to persuade other members of that. I am not sure it is particularly helpful at this stage by ourselves to introduce new demands in the context of a resumed IGC, if and when that happens. Independently of that though, I think there is a huge amount that the House of Commons or Parliament as a whole can and should be doing, obtaining better interpretation, travel and translation services, linking up with other European committees and other national parliaments, doing more work directly in Brussels, so that at every stage we are there before suddenly an issue arises at the last minute and it is difficult then to unpick. I do pay tribute to the IGC standing committee's work and members from all parties in really representing the interests of the North Sea energy industry and there, frankly, MPs were ahead of the executive and they served Parliament, their constituents and important national interests exceptionally well. Q31 Mr Steen: I come to this convention business with a certain simplicity because I was always convinced and I was told that the purpose of the convention was to deal with the 25 countries. We cannot possibly have the same rules and regulations that we had for 15 so let us have this convention with just one or two nods and the whole thing will work like clockwork with the 25. What happened was not that but the conclusion was to codify all the treaties and simply call it a constitution. Some people were saying it is just tidying up the treaties and putting it into one treaty, which is the attractive way of doing it. The other way was a constitution over all national parliaments, the United States of Europe. It strikes me that either the UK government has been hoodwinked, which I cannot believe, or that the Spanish and the Poles are alert to what the whole aim is and they are using the voting business as an excuse to kibosh the constitution. As I understand it, there hardly ever are any votes. When we were talking to Mr Kinnock, he said, "There have not been any votes. Everything is by consensus." If everything is by consensus, what are the Spanish and the Poles doing talking about votes? The reason is they have spotted that this is - I would not use the word "plot" - but a manoeuvre by the French and Germans to further their cause of the United States of Europe. Am I right? Bearing in mind Agatha Christie was a constituent of mine, you will understand why I am asking these questions. Secondly, we have talked about the Poles and the Spanish. What about all the other countries? What about the Latvians, the Estonians, the Cypriots, the Maltese? They are no fools. What are they doing in all this because we have not heard a word about them. Mr MacShane: I do not know if she was a constituent of yours when she disappeared and I do not know whether it is Miss Marple or Hercule Poirot, that well known federalist, who should solve these problems for us. After the not very satisfactory Nice Council procedures - you have heard the Prime Minister talk about those and that was a view commonly held across Europe - that decision was taken at Laeken to initiate the convention proceedings. There were some things that we think did go in the right direction, namely a standing chairman of the Council and getting rid of the six month rotating presidency, which were positive. You are right to say that votes are very rarely used. I do not think I have seen one in my short time as Europe Minister. Perhaps I will be lucky over the passage of years to see what a vote in the Council looks like. The pressure that is out there that the votes can be exercised - they do not come to vote because people know four or five countries are so-called blocking minority - is real. There are issues that we consider to be of importance that we either do or do not want to get past that are advanced or not because people can count the votes. The Estonians, Latvians and Cypriots are all very keen to join the European Union. They have voted overwhelmingly in referenda, not in Cyprus but in the other countries, to join despite the enticements put to them by people who invited them to say no. Estonia is a rigorously taxed, competitive, low tax economy and jolly good luck to it. It is doing very well. Others were very happy with the other arrangements. When we arrived in Brussels, it was also clear that France and Germany were not going to move so in a sense, if the object is to award hero status to a country that stopped the weekend at Brussels where it was stopped, you might as well give it to France. The Sun or The Daily Mail should declare President Chirac to be the hero of the hour, but I do not think that would quite fit in with their ideology. Poland certainly is determined to make a huge success of its membership of the European Union. It is as committed to European Union membership as this government. All the accession states see the European Union in very positive terms and in due course they may consider that some of the arrangements under the existing constitutional treaties, the reference to an every close union, the Nice voting weights, the turning of the presidency every six months, may not be to their advantage but the future will answer those questions. Q32 Mr Tynan: When I look at the text , Mr Berlusconi says that delegations have agreed and there is unanimous political agreement on these subjects that they would not be reopened and then you have the contradiction from Prodi who explicitly rejected the claims. Could I ask a question as regards the red line issues, in particular on the basis of what decision was reached as regards qualified majority voting in respect of criminal justice? Mr MacShane: To my knowledge, we did not get to that discussion. We were largely happy with where we were on criminal justice. For example, we were not going to see a European public prosecutor created. We were quite happy with the development of Eurojust, but in the statement that Mr Berlusconi made, this famous oral statement, he referred to maintaining unanimity in the criminal justice field. He said that the majority of states wanted to keep unanimity on the financing of the EU, so we would consider that that also was a bankable assurance. To revert to earlier points, I have to tell you how it was. It is not a written declaration; it is a note taken but 24 other governments were there and all heard the same remarks. Q33 Mr Tynan: It says that the IGC only had 90 minutes in plenary session and the rest was on bilaterals and institutional points. The question I asked was regarding qualified majority voting. Was there a decision reached as regards criminal justice and whether qualified majority voting was applied or not? Mr MacShane: What we told the presidency was, as far as Britain is concerned, we want to maintain unanimity in these areas. Other countries also told the presidency that. In bilaterals or trilaterals with other leading partners who have a different perspective, we would spell out quite clearly that unanimity was vital for us. No unanimity, no treaty, if you like. Since the intensity of discussions was on the voting issue, we then passed to what Mr Berlusconi said as the President in office of the European Council at the meeting. He said that there is a consensus that unanimity is upheld in these areas. Those are the bankable statements that we refer to. Q34 Mr Tynan: Qualified majority voting would not apply to criminal justice? Mr MacShane: That is what Mr Berlusconi said but we are back to the problem of nothing is agreed until everything is agreed. This is the difficulty with this procedure. It is not step by step. You rewrite a text; you amend it; you republish the amended version; you revisit it. It is a parallel process that allows people to maintain positions up to the moment when perhaps they have to come to some form of compromise. I cannot repeat enough that what you saw was what you got in the White Paper. Those are the positions that Britain took forward. I pay tribute to our diplomats and negotiators. The Foreign Secretary spent an immense amount of personal time on this. All during the autumn, we continually repeated that this was what we needed to bring back a constitutional treaty that would go through the House of Commons. I said that myself at a lower level in the bilaterals that I had. Our ambassador said that. Our diplomatic and EU expert said that. The last concluding moment was Mr Berlusconi announcing in the name of the European Union or the Council that there was agreement that unanimity should be maintained in those areas. I think it was a tribute to the very hard, professional work and very dedicated political work of the Prime Minister, the Foreign Secretary and the diplomats who serve our country very well. Q35 Mr Marshall: I am sure it is not lost on the great minds in the Foreign Office and Number Ten Downing Street that if the Irish fail and the Dutch fail and the Luxembourguese fail, the hot potato falls to us. Mr MacShane: It will be rather tepid by then, will it not? Q36 Mr Marshall: It could still be very hot, particularly in June and July 2005. I wonder if the government is looking forward to that situation but, more seriously, what concrete suggestions, instead of all this airy-fairy discussion we have been having, would the British government put forward to seek to resolve this impasse? Mr MacShane: In his speech yesterday, the Foreign Secretary talked of a period of reflection. I do not think two or three days after we are just back from Brussels it is appropriate to announce here significant new initiatives. I am certainly not mandated so to do. Personally, I want to think and reflect on this. We all have to go away and look at the whole convention procedure, look at the six months of the IGC and see how we come back to this issue. I think it would be useful to bring all the texts into one constitutional rule book or treaty that everybody could understand. I certainly personally attach quite a lot of importance to having a standing chair of the European Council, if we can achieve that, and having a greater voice and strength for national parliaments. If we achieve none of these things, we are back to where we are today, with everybody complaining that national parliaments do not have enough role. After the Nice and the Amsterdam Treaty, honourable and right honourable members of this House said that they were inexorable steps towards a super state. After the Maastricht Treaty, honourable and right honourable members of this House said that Maastricht represented the open door to a super state. In my own party, since they have left the House, old friends, like Tony Benn and Arthur Scargill, have said that we were opening the door to a super state of Europe 25 or 30 years ago. I have not quite seen it happen but I do think that we will need to reflect seriously over the next few weeks and discuss with our Irish friends and our other friends (I think, principally, we will all take a Christmas and New Year break) on how we go forward. However, I do not have in my pocket any new British initiative today to report to the Committee. Q37 Chairman: Minister, it would be fair to say there are some of us concerned that there seemed to be an indecent haste to get an agreement under the Italian Presidency. Some of us were advising last year that because Mr Berlusconi wanted a Rome Treaty is not necessarily the reason for rushing. It may be that those who were pushing for an earlier settlement may well have done more harm than good. Mr MacShane: Mr Chairman, I completely agree with you and I think the Foreign Secretary also made the case "better no Constitutional Treaty than a bad one". I think he gave extensive evidence. I believe he has been the first Foreign Secretary to come before your Committee and in extenso explain his position. He has set up this IGC Standing committee and he has gone out of his way, if I can pay a personal tribute, to report to Parliament. We have had eight substantive debates in the IGC, something like 16 Parliamentary reports on it and a very great number of parliamentary committee hearings. Yes, I think festina lente - make haste slowly - is a good watchword. Europe has been through crises like this before; the 1960s was not a sunny period of the founding six but moments of the most enormous crisis with the so-called "empty chair"crisis initiated by General de Gaulle. We will come through this. I certainly welcome the chance to think a bit more and talk a bit more. I regard all four countries that have been most named in the last few days, France, Germany, Spain and Poland, as indispensable partners for Britain, and would not wish, as it were, to take forward positions in the face of bitter hostility of any one of them. I have respect and admiration for all those countries as they struggle to defend their national interests and build a stronger European Union. Q38 Mr Heathcoat-Amory: Following Mr Tynan's earlier question about criminal justice, the Government's White Paper, which I have here, only gives the harmonisation of criminal law procedures as a red line issue, but we know the Government was concerned much more widely than that because of the amendments that it tabled in the Convention. I have a copy of the very strongly-worded amendments at that time, objecting, for instance, to all the articles about asylum, the harmonisation of civil law matters and, also, the inclusion of a European Public Prosecutor, because even though it will be by unanimity we will still be constitutionally committed to it if it goes into the final text. So in the Convention the Government had a lot more red lines, and I would like an explanation of what happened between the Convention and the White Paper which dropped all but one of the red line issues. Given that we may come back to this negotiation on the Convention late next year, the White Paper will clearly then be very out-of-date. So it may be an opportunity for us to raise matters, as the Poles did, quite late, after discussion in Parliament and with our electors about new matters which do concern us, particularly as we know that they very much did concern the Government when the Convention was on. Mr MacShane: Mr Chairman, there are different areas being slightly mixed together there: asylum, criminal law, European Public Prosecutor and criminal procedure. The Government was successful with other partners in removing the reference, for example, to a "single legislative council", in removing the reference to a European Public Prosecutor and on asylum, of course, we want the possibility of opting in to majority decisions where it is in our interests. We do not think we would have got movement on Sangatte or movement on setting up a European database - it is called Eurodat - which has allowed us to return home people who, in the jargon, are called "asylum shoppers". These were all areas where we wanted to defend what was in British national interest, and in some of those areas QMV would have been appropriate. The different amendments put up during the Convention discussion reflected also negotiating positions - some of them were small, some of them were technical. I know Members and Right Honourable Members who were on the Convention want to revisit what happened up to June last year, but looking forward to 2004 I think we will bank what we have achieved - and those are in the Presidency declaration, as I have said - and where we think QMV may be useful we will defend that position, but always in a way that is fully accountable to Parliament. At the end of the last IGC Standing Committee hearing, Mr Chairman, I said to Mr Cook, who chairs it: "Goodbye. That's it. We have had our meetings, it is all over." I spoke too soon. So I am sure if the Right Honourable Gentleman - and he has come to those meetings and been very assiduous - has continuing concerns they can be dealt with in that context. Q39 Mr Heathcoat-Amory: I am sorry, I still have not got a reply. If these were Government objections, even to the QMV advantage, which the Minister is now saying is a good idea, that was not the view of the Government last summer. I am still not clear why that was whittled down to one sole objection in the White Paper. There is only one red line left out of all the Government objections and all the unsuccessful amendments tabled during the Convention. I just want to know why the Government changed its mind in the few weeks, in some cases, between the tabling of those amendments which are very strongly worded - the Right Honourable Gentlemen, the Member for Neath, was using language like "unacceptable" and "this is a fundamentally important amendment" at that time in the Convention and then it suddenly gets magically forgotten. I think we are owed an explanation for the dramatic change in the Government's negotiating position. Mr MacShane: With respect, Mr Chairman, paragraph 83 of the White Paper says that the Government "believes QMV would not be appropriate for criminal procedure law"; paragraph 84 "Government will not give up UK's right to carry out frontier controls and the protocol for safeguarding the UK position" and paragraph 85, "... see no need for the creation of an EEP [European Public Prosecutor]". So the message from the White Paper was, I think, pretty robust that the Government believed unanimity was in the wider interests of Europe in the crucial area of criminal procedure. Historically, in the contract between the citizen and the state, the citizen allows the state to take away his life, his liberty and his money. Well, we have abolished the death penalty, but we still put people in prison and we still take away money - they are called "taxes" - and our view was that those contractual relationships should principally remain ones between national Parliaments and national governments and their citizens; it should not be transferred to Brussels. I think we have very strongly maintained that position. Q40 Mr Cash: It is all waffle, is it not, Minister? You are trying to defend a position which has become untenable. You went into these negotiations with certain red lines, many of which were red herrings anyway, and what you have now done is, effectively, just back off from the whole operation and just left the United Kingdom in an almighty mess. Mr MacShane: Mr Chairman, I am happy always to debate with the Honourable Member for Stone and use his vocabulary if it takes us further forward. My view is that the White Paper presented to Parliament set out the Government's position. It was clear, it was unambiguous and we maintained it. I defended those positions, officials did, the Foreign Secretary and the Prime Minister did, and inasmuch as we got to where we got on Saturday the Presidency accepted that. There was a lot of pressure from a lot of partner governments who are happy to share sovereignty in some of those areas. We had to say "Sorry, that is not where we want to be." We were not alone, as I said, and I think what we were doing was defending the interests of Europe as well as British national interests. Q41 Mr Cash: Why did you not veto the whole thing? Mr MacShane: Because, as the Prime Minister made clear, the Foreign Secretary made clear and I will make clear, there were parts of the Convention and a satisfactory Constitutional Treaty text that we would have welcomed. One thing that some people are much concerned about is the excision of the reference to "ever closer union". We now have got "ever closer union" remaining in the existing treaties, and we will have to live with it for ever more until we come to a new Constitutional Treaty. Q42 Mr Bacon: Minister, following the collapse of the IGC, there has been talk among some Member States of a two-speed Europe, with a hard-core moving ahead with closer co-operation in certain areas. Do you think that that is just a negotiating position - a threat, if you like - or is it a real and viable possibility? Bearing in mind what the Treaty says about how co-operation and initiatives within an EU context must take place. Mr MacShane: I think we will have to explore this in some detail, and I hope perhaps we can have a Parliamentary debate or discussion on it. As the Prime Minister has made clear, Europe does have areas of activity such as defence where some countries come together - the euro, obviously, is a prime example, and Schengen is another. I am looking forward to the fact that the next four Presidencies (Ireland, the Netherlands, Luxembourg and ourselves) will be two years of more liberal, open trade and competitive thinking, and I hope that might give us a real impetus to take forward the ideas in the Coch Report, some of the ideas in the Sapir Report and make the Lisbon agenda have some extra energy in it. I find it quite hard to see how you can have an EU within an EU; how a number of countries - 2, 3, 4, 5, 6, 7 or 8 - would have such total identity of interest that they would, as it were, create an inner core. A two-speed Europe? There is a multi-speed Europe as it is; some European economies are creating a lot more jobs than others, some are prepared to take international security and defence responsibilities more than others and some are more happy about relaxing border controls than others. That is the European reality. I have never driven a car with just two speeds on it, and I am far from convinced - although the language sometimes is used - that this is convertible into reality. Mr Steen: I am just a little concerned about this question of how we go forward. How do we move forward? Are we going ahead? The question is "To what?" What are we going ahead to? What is wrong with what we have got? What are the new bits that we are aiming for? It strikes me that everybody is aiming for different things. I am not being facetious when I say this: why do we not look at whether we should be going backwards? Q43 Mr Cash: There is no reverse gear. Mr MacShane: I am glad the Honourable Member for Stone plucked that arresting metaphor from a recent speech, which I listened to with great care and not a little devotion. The issue, I think, is that what we all want in Europe, I hope, are jobs, material prosperity, a sense of living under a rule of law, human rights, preserving our environment strength, and the society in which we live having its rules looked after, and our different cultures and identities. I am sounding a bit like a Euro-evangelist, which I would not want to bore the Committee with. For all of those things we will have to come to agreement with others. I will give you a very specific example: it was Britain that put into the text the notion that animals are sentient beings. There are a number of other European countries which are quite opposed to that because the moment you call animals sentient beings they can be afforded protection in transportation and the rest of it. That is of passionate importance to many people in our country but not of a great deal of importance to citizens of other countries. To get that in we have got to get these other countries to agree with us. That is a British contribution, if you like. I like the idea of standing still, no forward gear, no reverse gear, just in neutral, but we cannot do that with our own House of Commons; there are issues that emerge and whether it is responding to security and defence issues in the Balkans or in Africa, or whether it is responding to the problems of global warming or responding to how we organise world trade rules - the re-launch of Cancun - in all of those Europe is obliged, it seems to me. We could break up into 25 competing nation-states, all at each other's throats, but I do not think any of us has got a real interest in that or would find it a very good way of moving forward. But my own personal vision, and I have made it in speech after speech since I have been Europe Minister, is a Brechtian one, "erst das fressalien den komm die morale" (?), which in Parliamentary language means "grub first, politics later" - jobs, material advance, more wealth for everybody, better salaries, and then let us worry about all the constitutional and political stuff. I hope, perhaps, that in some of the next two years' worth of Presidencies we might become a little more Brechtian and a little less philosophically Hegelian. Chairman: With that encouragement it is time to go to Mr Marshall. Q44 Mr Marshall: The Minister has used the word "sentient"; I can only say that after 75 minutes of this I feel very insentient. Maybe I do not qualify for the protection that the UK has got. Minister, when you were replying to Mr Bacon's original question on a two-speed Europe, and a hard-core whatever - enhanced co-operation - you did actually mention defence in your response. You will be aware that the Treaty of Nice does actually specifically exclude enhanced co-operation in the sphere of defence. If a number of core European Union Member States do wish to progress co-operation in defence and security matters, what structures will they do it under? Will they create new structures which are not formally part of the European Union? Or, maybe, they will use existing structures like the WEU, which has formed such a vehicle in the past. Mr MacShane: I do not think so. I think on defence we have come out of Brussels with a very good deal. There is a Council declaration on defence - language there that has been principally negotiated between ourselves, the French and the Germans and been discussed, obviously, with all our NATO partners here and across the Atlantic, which sets out very clearly how European defence will move forward, the hierarchy of what NATO does, Berlin Plus and then the humanitarian/peace-keeping missions which will be done by the EU and the administrative arrangements to give effect to that. What we have not got is any new language in the Treaty because we have not concluded a treaty on defence, but quite separately all three governments are pleased because it has showed how Europe can advance and make progress in some quite tricky discussions on defence, as has been reported in the press in the last few months. Q45 Mr Marshall: What you are saying is that there have been formal changes within the European institutions themselves, in terms of the planning cell. However, if Britain, France and Germany wish to co-operate far more closely - in what would be termed enhanced co-operation which is specifically excluded at the moment under the Treaty of Nice - how would they progress that? Mr MacShane: We would do it as in the context of multinational co-operation. Q46 Mr Marshall: So it would be non-EU? Mr MacShane: It would be not be governed by provisions in a Constitutional Treaty, just as when three foreign ministers went to Iran - Mr Straw, Mr Fischer and Mr de Villepin - to deliver a very clear message, that was not formally a European Union initiative but, nonetheless, in a sense, they were speaking for Europe. What we have got, though, and this is important, is the European Council putting out a lengthy statement which is on the record setting out the agreement on defence, very strong, positive language on NATO which we welcome, so that is there to take us forward and guide us. What we have not got is any changes in existing treaty clauses on defence because we never finished the new Constitutional Treaty. Q47 Chairman: I wonder, Minister, if you could outline the most important points of the agreement that was reached between the UK, Germany and France? According to the Prime Minister, it was welcomed by the European Council. Mr MacShane: Very simply, what we achieved was - and I am quoting now the German Chancellor, Mr Schroeder - to make clear that European defence is one of the pillars of NATO; that there is a hierarchy of NATO first, then European Union Member States agreeing to participate in a mission but requiring to use NATO assets (air transport, intelligence assets and so on), which is Berlin Plus, and finally there would be a completely EU-only operation mainly in the carrying out of Petersburg tasks - peace-keeping, humanitarian and policing. We have already seen that in Macedonia and Bunya in the Congo. The other thing we have agreed is a complete linking together of what the EU does and what NATO does, so a planning cell at SHAPE, linked to the EU military staff that already exists. We also excluded a standing headquarters, an EU headquarters that would have its own independent role as operational headquarters. So we have not got a full-time permanent staff to run an operational headquarters and it would be principally national military headquarters that would be the lead headquarters on operations. President Bush has welcomed this in public statements, and as we look certainly to the Balkans where European military and security presence is required, as we look perhaps to other interventions in Africa (the Great Lakes region remains of some very deep concern) I think it is good that we now able to give effect to the need for Europe to accept defence responsibilities. Q48 Chairman: Minister, we know there was an accommodation reached with Ireland as a neutral country. Were there any other Member States seeking accommodation outside the agreement between the French and the Germans? Mr MacShane: We should distinguish between the Constitutional Treaty, where four neutral countries made a de marche just before Friday, which we certainly had considerable sympathy for. However, again, we never got to that because the final text of the Constitutional Treaty was not gone into as it became clear that on the issue of voting rights we were not going to come to any agreement. Quite separately we got a European Council decision welcoming the creation, principally under the impetus of ourselves, France and Germany, of what I have just referred to. Clearly, the neutral states are not going to be directly involved in that unless they so choose to, and of course in a large number of peace-keeping and humanitarian operations, Petersburg tasks, I have seen colleagues from neutral states - a Finnish general was I think in Macedonia and the Swedes were in Bunya - and we co-operate very closely with what may be neutral countries but, believe me, are extremely professional armed services. Q49 Chairman: Minister, I know you have to be in Westminster at 3.30. It is a measure of our interest to say we have not got anywhere near through the areas we wanted to look into. Mr MacShane: I have probably given too long answers. Q50 Chairman: I think it is more because - and I have likened you to a fly fishermen on occasions - I have seen one or two of the flies being taken in one or two of your answers, which I found very interesting. Minister, thank you very much. We will consider writing to you to cover some of the areas we missed, or we may even invite you back in the New Year, if you can find time to come back and see us. Thank you. Mr MacShane: A Happy Christmas to you all. Chairman: And the same to yourself. |