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Mr. Cash: The Minister has just been praising the financial investigation team known as OLAF, but will he note that although 9,400 cases of fraud were
reported in 2004 there has been not one successful conviction of any major wrongdoer, and that no funds have been recovered in the seven years of OLAFs existence? Is that a success, in the Ministers terms?
John Healey: The questions that the hon. Gentleman raises are questions for OLAF. Surely he would not contest that we need such a body at the heart of the European Union. We also need the independent internal audit unit that the Commissioner has set up.
The inter-institutional agreement and the own resources decisions are the final parts of what has been a long difficult negotiation on the financial perspective. As the first negotiation of a union of 25 member states, it was bound to be complex. It is, however, a unique opportunity to modernise the budget and set out a process that will lead to a budget more fit for purpose for the European Union of the 21st century.
In the first place, the agreement ensures budget discipline. Rejecting the Commissions proposal for a budget of €1,025 billion, member states have instead agreed a budget of €864 billion, or 1.048 per cent. of EU gross national income. By 2013, the starting point for future negotiations, the budget will be about 1 per cent. of EU gross national incomeits lowest level for 20 years.
The budget also allows for an historic shift in spending from the old member states of the Union to the new central and eastern European member states. It supports our long-argued UK commitment to EU enlargement. Over the coming years, the funds forthe new member states will increase from less than€30 billion to more than €170 billiona sevenfold increase. These funds aid their economic development, and they will not only make them more prosperous and more stable, but bring significant benefits to the UK too. UK exports to the eight eastern European new member states totalled in 2004 £5.3 billionup by around 230 per cent. over those of the previous decade. Access to these new and growing markets will benefit UK consumers and UK business.
The historic enlargement of the EU, combined with the intensifying global challenges on the economy, poverty, the environment and security, meant that the financing of the EU could no longer be viewed in the manner that it had been prior to 2004. As the Prime Minister said, as the EUs strongest supporter of enlargement, it was fair and right that the UK contributed properly to the costs of enlargement.
We have consistently argued, however, and carried out the argument in the negotiations, that the UK abatement remains justified because of the inequalities and inefficiencies on the expenditure side of the budget. The December Council conclusions that were agreed say:
The UK budgetary correction mechanism (the UK abatement) shall remain.
The UK abatement remains, the abatement mechanism remains unchanged and the deal in December means that the UK will continue to receive the abatement in full on all EU spending in the old member states and on agricultural spending in the new member states, but we will forgo the increase in the abatement resulting from the economic development spending in the new member states and therefore will no longer receive an
abatement on spending that contributes to the growth and the prosperity of Europes poorest countries. As a result of those changes, the UKs net contribution will, for the first time, be similar to that of France and that of Italymember states that are comparable to the UK in size and prosperity.
As a result of these changes, the total UK rebate will still be larger over the next financial perspective than the current onean estimated €41 billion in 2004 prices between 2007 and 2013 compared with€36 billion in the current financial perspective.
Finally, there will be the review of the budget. The review was agreed as part of the December package and confirmed in the inter-institutional agreement. The review will be led by the Commission and will report in 2008-09. It will allow the Council then to assess the value of all areas of EU expenditure, including the common agricultural policy. This is a process through which we can move to further reform of the CAP and further reform of the European budget as a whole to put it on a more rational and logical basis, so that it can concentrate on the things that are essential to Europes future.
Throughout this process of negotiation, the UKs objectives have been consistent. We wanted tight budgetary discipline; we wanted more spending on policy reform, especially more reform to the CAP and the structural funds; we wanted successful enlargement; and we also wanted to protect the UKs financial position. We secured budget growth limited to 13 per cent., when the Commission had proposed 25 per cent. We secured an EU budget that will be less than 1 per cent. of gross national income by 2013its lowest level for 20 years. We secured a massive uplift in social and cohesion fund allocations for the new member states, and secured more flexibility to ensure that those countries can effectively absorb the structural funds and improve their growth and productivity. We secured a doubling in research and development spending, and secured and retained the UK abatement, which will increase in value during the next financial perspective. We secured the political commitment of all member states and the Commission to a fundamental review of all aspects of expenditure and revenue.
That this House takes note of European Union Documents No. 5973/06, the Commissions revised Proposal for renewal of the Inter-institutional Agreement on budgetary discipline and improvement of the budgetary procedure, No. 6426/06, the Commission Contribution to the Inter-institutional Negotiations on the Proposal for renewal of the Inter-institutional Agreement on budgetary discipline and improvement of the budgetary procedure, and No. 7421/1/06, Draft Decision on the system of the European Communities own resources (//EC, Euratom); and supports the Governments objective of securing agreement on the Inter-institutional Agreement for the 2007-13 Financial Perspective and the Own Resources Decision in line with the agreement reached by Heads of Government at the December European Council.
Mr. George Galloway (Bethnal Green and Bow) (Respect): This will not be a rant about the venality of the prevailing orthodoxy in the British media. Everyone is currently recalling the words of Enoch Powell, who said that all political careers end in failure. [Interruption.] Actually, mine is going quite well, judging by last Thursdays election results. I advise Labour Members to pipe down on that particular subject; otherwise I shall talk to them about how we ripped apart the corrupt Labour administration in Tower Hamlets, defeating the leader, deputy leader, housing convenor, mayor, deputy mayorI could go on, Mr. Speaker, but you would not allow me to do so.
I am thinking of another of Mr. Powells remarks, however: that a politician complaining about the press is like a ships captain complaining about the sea. In any case, I have my own access to the media, having worked for nearly nine years for Associated Newspapers and for the last 16 weeks as host of a radio talk show on Saturday and Sunday nights.
It is not the grim and unremitting orthodoxy of the press about which I am concerned this evening, but the slip over the cusp of criminality into which some newspapers have lapsed. As long ago as 5 June 1999, I raised in this House the issue of the agent provocateur behaviour of Mazher Mahmood, otherwise known as the fake sheikh. I warned then that Mr. Murdochs flagship reporter was not so much involved in unmasking wrongdoing as in dreaming up acts of wrongdoing and setting up individuals to commit them. I should have known that one day, he wouldtry this on me. The expensive though abstemious Dorchester dinner that he threw for me in March of this year was intended to entrap me in a foreign funding scam in advance of the local elections in which my party, Respect, as I have just had the opportunity to say, did rather well. When I rebuffed this crude attempt to suborn me, Mr. Murdochs finest tried to entice me down the poisonous path of anti-Semitism and holocaust denial.
Nearly as reprehensible were the arguments later adduced by counsel for Mahmood, paid for by Murdoch, in its vain attempt to prevent me from publishing pictures of the fake sheikh, which can now be found on the Respect coalition website and in other places. Its argument that this was an invasion of Mahmoods privacy, and that pictures of him taken for one purpose should not be used for anotherfor publication in a national newspaperwould of course put The News of the World out of business. In the words of Justice Mitting, who heard the case:
Im surprised that that argument is being advanced from your corner.
The point is that Mahmoods behaviour toward me and many others whom he did manage to deceive is not only reprehensible but surely illegal, as ProfessorRoy Greenslade has argued in several recent articles. I should be interested to hear the Governments view on this, and to hear of any plans that they have to tackle this abuse of press freedom.
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