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The reality is that in a common market, taxation tends to approximate over time, not because people are being forced down that route by the European Commission, but simply because of the logic of the working of that internal market.
I hope that we will discuss today the regional considerations relating to the EU and the constitutional treaty. In my own area, the debate on Europe is sometimes somewhat different in tone from that in certain other parts of the country, perhaps partly because one of the major employers in my constituency is the Nissan car plant, which does most of its export trade with Europe and thinks along very European lines. The attitude towards the EU of my constituents who work in that plant is often different from that of others. It is important that we discuss during the referendum campaign not just the importance of Europe to our economy in general, but the way in which such importance breaks down in different areas of the UK.
The Labour Government have made many solid achievements in their approach to Europe. We negotiated very successfully in Amsterdam, at the Berlin
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summit and during discussions on the Nice treaty, when the disagreements were between the French and the Germans, rather than with us. We have therefore achieved what we set out to achieve, which is important, but I should point out respectfully to Ministers that sometimes, we overstate the case for a victory for Britain, as if we had secured such a victory against everyone else. In reality, on most issues, most of the time, we have many allies. I attended several Council meetings as a Minister with various areas of responsibility, and I was always struck not by the amount of conflict but by the great consensus that dominated such meetings. As a result, most of the time they proceeded very smoothly indeed.
The challenge of the referendum is daunting, but through that process we should aim to give our citizens more information, provide a more realistic picture of what the EU does, rebut some of the sillier myths that seem to abound, and put forward a vision of sensible, practical co-operation that is good for Britain and for Europe. I hope that we can prove successful in this task.
Mr. William Hague (Richmond, Yorks) (Con): It is always a pleasure to follow the right hon. Member for Gateshead, East and Washington, West (Joyce Quin), who has further illustrated that this issue always causes divisions within parties, as well as across them. There are Members who are in favour of the treaty but against a referendum, while others take the opposite view. Reference has already been made to many British traditions being under threat, but this debate shows that the splendid British tradition of being utterly inconsistent and unpredictable, as the right hon. Lady has pointed out, on the question of when to hold referendums is fully alive, as it will be at the conclusion of this debate and when the Bill completes its passage.
That said, I welcome the fact that the Government have concluded that there should be a referendum. Like my right hon. and learned Friend the Member for Devizes (Mr. Ancram), I believe that the matter should have been dealt with in a Bill separate from that implementing the treaty, but it is good that the Government have executed this handbrake-turn just before the European elections.
I want to draw our attention to people outside this House, who will be puzzled by the criteria that we apply to this issue, to the question of the constitutional treaty. It is common ground in this House that there is a great deal of public disaffection with the political process, and that disillusionment with politics has grown greatly in recent decades. To the shame of all of us who were candidates or leaders of our parties, the turnout at the last general election was 59 per cent. Comparable figures in polls today show that the percentage of people who are certain to vote at the next election is perhaps in the lower 50s. Such great disaffection is partly the result of the increased gulf between the people of this country and the decisions that are made in their name.The increasing integration of political power in the EU, which is a key part of that process, is a fundamental part of my objection to this treaty and a fundamental test against which constitutional change should be judged.
We must ask whether, at a time of disaffection, such change makes matters better or worse. This constitution will make matters worse. Those who have followed the
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political debates of the past few weeks will have noticed that powers have been transferred to the EU in an alarming number of areas. When my right hon. and learned Friend the Leader of the Opposition proposed a limit on the number of immigrants to this country a couple of weeks agothere will be different opinions in the House about the merits of that proposalthe European Commission made it clear that he would not have the power to implement such a limit. [Interruption.] The Minister appears to be contradicting that interpretation, which would be important news.
Mr. MacShane: I think that the Commission simply pointed out that under the 1951 convention, to which we are committed, Britain cannot limit the number of refugees. It was talking not about economic migrants but purely about the terms of the 1951 convention, by which we are treaty-bound.
Mr. Hague: There is clearly a difference of opinion between Government and Opposition Front Benchers on this issue, which it is important to clarify. As I understood it, despite all the assurances about opting out, because the Government had signed the qualifications directive, thereby opting into the latest EU arrangements, this country was now committed to the additional immigration policies adopted by the EU.
Mr. Heathcoat-Amory : What is beyond doubt is that the constitution would make it permanently impossible to leave the 1951 convention; indeed, such a principle is entrenched not only in the constitution itself, but in the EU charter of fundamental rights. So from that point on it would be impossible for any incoming Government, after winning a general election, to do anything about that convention.
Mr. Hague: My right hon. Friend has immense knowledge of this subject, and that sounds like the correct interpretation. [Interruption.] I hope that the Minister listened to it, although he is not showing much sign of having done so.
Let us consider other subjects, small and large. A couple of weeks ago, we debated in this House the European food supplements directive, of all things. People may wonder why on earth it is the business of any level of government to be supervising such a thing, let alone a layer of government beyond the control of the people of this country. Now, if people ask their Member of Parliament to do something about that issue, the answer is, "We cannot do anything about it." Even if we vote against the measure, it will still take legal effect.
A tax case is being heard in the European courts this very week. Marks & Spencer is in dispute with Her Majesty's Treasury, and that case may have bigger implications for taxation in this country than even anything that the Chancellor might wish to introduce in his forthcoming Budget. We are talking about vast sums of money. In that case, the European Court will decide British tax law. Marks & Spencer is taking the case under provisions that were never intended to transfer rights over taxation to the European Court.
Whether it is an enormous subject such as immigration or taxation or whether it is something much more minor in our national affairs such as food
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supplements, which are important to hundreds and thousands of people, people see each day that more and more power has been drained away from our national Parliament and is now under the control of the institutions of the European Union. The separation between the people of this country and the ability to decide the laws that are made in their name is very dangerous for a democracy. The power to set such policies is among the attributes of a nation, and the people's power to control the setting of such policies is among the fundamental attributes of democracy.
We come across relevant examples all the time. The working time directive was introduced years ago under qualified majority voting and against the opposition of the British Government, and years later, it has many different effects. Those of us who represent rural constituencies have seen services within the NHS become more difficult to maintain because of the working time directive.
This country did not agree to the working time directive. This country would never have initiated the directive, which was dreamed up by officials who do not live in this country and who know nothing of the circumstances in our health service. Although the Foreign Secretary can give assurances on occasions such as this, more and more power has been given away across a wide range of policies. The situation is dangerous, and the constitution will give away more powerthe President of the European Court has said that the charter of fundamental rights will open new areas and subjects to the Court. The hon. Member for Leicester, East (Keith Vaz) knows the charter very well because we often tease him about it. A few years ago, he said that it would have the legal force of the Beano. Now, the President of the European Court says that it takes in new areas and new subjects.
As my right hon. Friend the Member for Wells (Mr. Heathcoat-Amory) has pointed out, the list of areas that have been added to qualified majority voting and from which the veto has been taken away is long. I am astonished that the right hon. and learned Member for North-East Fife (Sir Menzies Campbell) is not familiar with that list, because it is a very long list indeed.
Large parts of the constitution are, of course, incomprehensible, and one cannot know what it will mean in the future. However, we know from our experience of the working time directive what such legislation can come to mean over time. The separation between the people, who are meant to exercise their democratic rights, and the institutions working in their name continues. In the United States' constitution, the separation of powers means the separation of the Executive, the judiciary and the legislature. In the European constitution, the separation of powers means the separation of the right to make laws from the people, who should decide democratically the laws that are made in their name. That separation will result in catastrophe in due course.
The Foreign Secretary has provided the reassurance that subsidiarity will come into play. However, the right hon. and learned Member for North-East Fife gave the
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game away when he said that subsidiarity should have been strengthened for political and presentational reasons. One gets the sense that the whole thing is for political and presentational reasons.
Subsidiarity has been described as a "yellow card", which sounds like a forceful sanction, but there is no referee to exercise it. Instead, one must get members of the crowd to agree to show the yellow card and to get other members of the crowd from other countries to show the same yellow card at the same time, as a result of which nothing can happen. A blocking provisiona red cardwould have been better, but that would conflict with the destruction of the veto across a wide range of policies, so it is clearly impossible to introduce a blocking provision within the framework of the constitution.
We have been told that a new safeguard will be introduced against the abuse of European Union power, but it is unlikely to be used in practice in this House. It is highly unlikely that a majority in this House, which would normally mean a majority over the Government of the day, would object to an EU directive at the same time as the same thing is done in the Bundestag or the French National Assembly. Even if it were to happen, under the constitution the European Commission could turn round and say, "No; we maintain our previous opinion. You can all go away." Where will our country's democracy stand when we arrive in that situation?
Those are fundamental objections to the ever-growing power of European institutions, but there are many other objections. For example, those European institutions have a scandalous inability to control expenditure. That point has already been referred to, and when I raised it in this House a couple of months ago, the Minister for Europe shrugged his shoulders and said that a lot of the fraud occurs in the national Governments of the European Union. However, some of the worst fraud occurred in EUROSTAT, which is under the direct control of the European Commission. The right hon. and learned Member for North-East Fife compared the European Commission to Birmingham council in its time, but if the district auditor had come back here and told us that for 10 years running, 95 per cent. of the expenditure of Birmingham city council had been open to fraud, corruption and abuse, we would have shut down Birmingham city council by now.
It is absolutely intolerable that this situation exists and I want to know from the Ministeras I asked him two months agowhen he winds up the debate, what he has been doing about it in the meantime, and when a British Minister will go to the Council of Ministers, bang the table and say, "If you want money from the hard-working British taxpayer, you have to show how it is being spent." It cannot be right to give more power to European institutions; this is the latest example of a string of treaties that do so, and they are not even fit to exercise the power and the money already placed in their hands.
There is a long list of other important objections, but I shall rest on that one and the more fundamental one that I have put forwardthat a separation between the people who live in a democracy and the way that they are governed and the laws made in their name will be deeply damaging in the long run, and we will regret it.
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