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“There are many things that we want to do to encourage local skills and research and development, and local businesses, but we’re not able to do because of the existing rules.”
So when, under the new clause, the Government report back to the House on whether they have secured concessions, they can tell us whether they have secured the concession, at least for countries such as ours, on regional funds, so that we control that money and use it for British priorities, rather than sending it to Brussels and having it sent back by them, having incurred administrative costs and being earmarked for uses that would not necessarily be the priority of the British people and the British Government.
The former Prime Minister made the concessions that are incorporated in the Bill. At the time, the then Chancellor was leaking to the press that he did not really support that. He thought that Tony Blair was being unduly weak and giving away too much. Now is his chance. He is now Prime Minister and this is the great vision that he has been seeking to put before the British people. He can do what he indicated in leaks that he wanted to do and give his Back Benchers a free vote on this Bill. They will then put him in a strong position to renegotiate and get the sort of deal that he wanted.
I fear that we did not get that deal because the outgoing Prime Minister had other priorities. He was looking to his own future. He did not want to end with a big row in Europe. That might have been in Britain’s interests, but it would not have been in his. He made a concession, which was a big contribution to his own future campaign to be President of Europe—an undeclared contribution, which dwarfs those of any member of the present Cabinet. I hope that that mistake, that unfortunate policy and that unfortunate weakness of the previous Prime Minister can be put right.
The new clause would strengthen the position of the Government and the House, and I hope that it will be accepted.
8.45 pm
Mr. Peter Bone (Wellingborough) (Con): I welcome the new clause, which has given the Government a get-out-of-jail card. I am sure that the Chief Secretary will accept it when we come to the end of the debate.
It was clear from what my right hon. Friend the Member for Hitchin and Harpenden (Mr. Lilley) said that the current Prime Minister made it clear that he disagreed with his predecessor on the deal. Since I entered the House, one thing that I have learned is that a small Bill with a few clauses that is being debated for a short time is a most important Bill, and the Government are trying to get something through the back door.
Mr. William Cash (Stone) (Con):
On the subject of the former Prime Minister and the current Prime Minister, does my hon. Friend think it more than likely
that the deal between them was that the outgoing Prime Minister would stand down, as shown in the recent programme “The Blair Years”, in return for the undertaking that the new Prime Minister would not oppose either the own resources decision or the European treaty, which we will debate next week?
Mr. Bone: That seems possible. The previous Prime Minister said that he would serve a full term, which he did not. Some deal must have been done.
Let me address the new clause. We are talking about something of enormous importance to British taxpayers. During the years that Mr. Blair was in power, the contribution to the EU made by British taxpayers, adjusted to today’s value of the pound, was more than £100 billion—enough money to run the health service free of charge for this year. We are talking about a change in the formula whereby the EC allocates its budget to individual countries. Each country has the right to debate that new way of raising funds, but I suspect that only this country will have reservations, because only this country is dealt such a bad deal by the formula.
Mr. Jim Devine (Livingston) (Lab): Let us be honest. Does the hon. Gentleman believe that Britain should be in the EU—yes or no?
Mr. Bone: I am grateful for that intervention, Sir Michael, but I am sure that you would rule me out of order if I were to reply, because we are talking about the new clause in particular.
The Chief Secretary was helpful in his opening statement and provided a lot of percentages, but he did not translate them into money. However, a written answer given in January 2006 set the record straight. It stated that in 2007, our net payments to the EU would be £4.7 billion, increasing to £6.8 billion by 2011—an increase of 45 per cent. How can a £2.1 billion increase for British taxpayers be right when we are in the middle of an economic crisis that requires us to have almost a statutory pay limit in the public services?
Mr. Hayes: My hon. Friend has enlightened the House with those figures. They stand in stark contrast with the assurance that the Chief Secretary gave us from the Dispatch Box a few moments ago that our contribution will be some £5 billion across the economic cycle. Either my hon. Friend is wrong, or the Chief Secretary inadvertently misled the House. If the second is the case, the Chief Secretary had better stand up now and put it right.
Mr. Bone:
I can only quote from the table in the written answer given by the hon. Member for Bury, South (Mr. Lewis). It clearly stated that in 2011, our net contribution would be in the range of £6 billion to £6.8 billion. I am sure that the Government were not wrong about that fact. Another interesting element of the written answer to which I have referred has to do with the so-called “dodgy money” that we get back from the EU. We give it £14 billion, and then some bureaucrat in Europe sends some of it back, with instructions about where it should be spent. I
remember driving around a small village in Wales and reading a blue plaque that stated that what amounted to a motorway had been built by the EU. Of course, there were no cars on it at all, but the Bill means that even the dodgy allocation of returned funds that I have described will be smaller. This year, we will get back £5.6 billion, but it is predicted that we will get only £4.2 billion in each year from 2011 to 2013. It cannot be in the national interest for us to pay substantially more money to the EU and yet get less money in return.
This is an enormously important debate. Thank goodness the Opposition, with the support of the Liberal Democrats, have given the Government a get-out-of-jail card.
Andy Burnham: I shall try to answer the points raised in the debate on new clause 1, which talks about the “outcome of the review”. The heart of the matter is the point at which the certificate to be issued by the Treasury would be debated in the House. When I intervened on the shadow Chief Secretary, his answer summed up the problem with the new clause. He referred me to paragraph 80 of the Commission document, which talks about a White Paper or report to be issued in the relevant time frame, but that is not the same as the “outcome of the review”.
Mr. Hammond indicated dissent.
Andy Burnham: The hon. Gentleman shakes his head and laughs, but that is a very important point. The White Paper would set out strategic, high-level principles, but that is not what the “outcome” of the budget review would be. Therefore, the new clause is immediately defective in that specific regard.
Mr. Hammond: What the Minister has described does not make the new clause defective. Instead, it makes it much easier for him to accept the proposal, as all he is being asked to agree is that the Treasury should be required to certify that it
“considers that the outcome of the review is satisfactory to the interests of the United Kingdom.”
Further processes may have to be conducted after the report of the review is submitted, but he is merely being asked to sign up to a commitment that the Treasury will certify that report.
Andy Burnham: No, I do not think that that is what the new clause proposes. It states:
“The condition referred to in subsection (2) is that the Treasury shall have laid before both Houses of Parliament a report on the review by the European Commission...including a certificate that the Treasury considers that the outcome of the review is satisfactory to the interests of the United Kingdom.”
I repeat that the review does not conclude with the publication of the relevant White Paper. There is no possibility that the review could achieve its “outcome” before the House has been asked to ratify the own resources decision in January 2009, and that is why I contend that the new clause is defective.
What, in essence, does new clause 1 ask the Government to do? The final sentence of paragraph 80 of the Commission’s document states:
“The review will also be taken into account in the preparatory work on the following Financial Perspective.”
I am sure that the hon. Member for Runnymede and Weybridge will accept that that is where work on the review will lead, but the logic of the new clause is that the outcome of the financial perspective being debated this evening should be held up until we have achieved a satisfactory outcome from the next financial perspective. The outcome of that review will inform the preparatory work for and the discussions on the next financial perspective—the one that begins after 2013. I say again, essentially, he is asking us to hold up the current financial perspective covering 2007 to 2013, pending the outcome of all of the discussions. The amendment is defective. It would cause us to miss the ratification deadline, and on that basis, I urge hon. Members on both sides of the House to reject it.
The hon. Member for Twickenham (Dr. Cable) asked a fair question. He asked what would be the practical consequences of not ratifying: would there be serious consequences, or would the provisions of the current financial perspective simply be held up? Let me be plain: there is no formal sanction—no fine or formal proceedings that could be instituted—but implementation of the present financial perspective could be delayed. Backdating to the beginning of 2007 can happen only after ratification.
Dr. Cable: Will the Chief Secretary give way?
Andy Burnham: Let me finish the point. The other consequence is what one might call a diplomatic or political consequence. We have every reason to believe that 26 other member states will ratify the own resources decision into their domestic legislation, so we would face the prospect of being one versus 26 in explaining why we failed to ratify the decision. I do not want to over-dramatise by saying that not ratifying the decision will lead to a complete breakdown, but there would be real consequences to not meeting the ratification deadline.
Dr. Cable: If the Chief Secretary believes that the outcome can be assessed only at the end of 2008, why did the Prime Minister in his statement to the House last December specifically refer to the World Trade Organisation negotiations, which must be concluded within the next few months?
Andy Burnham: In his comments, the hon. Gentleman asked whether the effect of that review could be felt before 2013. The answer is that it could. The previous Prime Minister argued for that in securing the review. My point in response to the new clause is that the outcome of the review cannot possibly be known before the ratification deadline.
Mr. Philip Hammond: Will the Chief Secretary give way?
Andy Burnham: I will give way one last time to the shadow Chief Secretary, but I am trying to answer seriously the points that were put to me during the debate. There can be no hope that the outcome of the review will be known before the ratification deadline. I have pointed out that there will be consequences of being held to have acted in bad faith and being isolated, which is not what the Government want.
Mr. Hammond: The point that the Chief Secretary made earlier is that the outcome of the review is not the final, definitive stage in preparing the next financial perspective. We accept that. All we are asking for is some clear sign that our partners are taking seriously the obligation into which they apparently entered to have a fundamental review of the EU budget, and that the Treasury, on the basis of the outcome of that review, is satisfied with that decision. That is what we are asking the Treasury to certify.
Secondly, the right hon. Gentleman is quite wrong to say that the current financial perspective will be held up. The current financial perspective is agreed and already operational. The only question at issue is the own resources decision. We will fall back on the existing own resources decision if the Bill falls tonight.
Andy Burnham: I am disappointed that the hon. Gentleman did not let me finish my point. The Commission document says that there will be a fundamental, no-taboos review. That is what we secured. I have explained clearly why the new clause is utterly defective. It would leave this country totally isolated in Europe. I can only conclude that that is where he and his whole party want us to be.
Question put, That the clause be read a Second time:—
The Committee divided: Ayes 216, Noes 301.
AYES
Afriyie, Adam
Ainsworth, Mr. Peter
Alexander, Danny
Amess, Mr. David
Ancram, rh Mr. Michael
Arbuthnot, rh Mr. James
Atkinson, Mr. Peter
Bacon, Mr. Richard
Baker, Norman
Barker, Gregory
Barrett, John
Beith, rh Mr. Alan
Bellingham, Mr. Henry
Benyon, Mr. Richard
Beresford, Sir Paul
Bone, Mr. Peter
Boswell, Mr. Tim
Bottomley, Peter
Brady, Mr. Graham
Brazier, Mr. Julian
Brokenshire, James
Brooke, Annette
Browne, Mr. Jeremy
Browning, Angela
Bruce, rh Malcolm
Burrowes, Mr. David
Burt, Alistair
Burt, Lorely
Butterfill, Sir John
Cable, Dr. Vincent
Campbell, rh Sir Menzies
Carmichael, Mr. Alistair
Carswell, Mr. Douglas
Cash, Mr. William
Chope, Mr. Christopher
Clappison, Mr. James
Clark, Greg
Clifton-Brown, Mr. Geoffrey
Conway, Derek
Cox, Mr. Geoffrey
Crabb, Mr. Stephen
Davies, David T.C. (Monmouth)
Davies, Philip
Djanogly, Mr. Jonathan
Dodds, Mr. Nigel
Dorrell, rh Mr. Stephen
Dorries, Mrs. Nadine
Duddridge, James
Duncan, Alan
Duncan Smith, rh Mr. Iain
Dunne, Mr. Philip
Evans, Mr. Nigel
Evennett, Mr. David
Fabricant, Michael
Fallon, Mr. Michael
Farron, Tim
Field, Mr. Mark
Fox, Dr. Liam
Francois, Mr. Mark
Gale, Mr. Roger
Garnier, Mr. Edward
Gauke, Mr. David
George, Andrew
Gibb, Mr. Nick
Gidley, Sandra
Gillan, Mrs. Cheryl
Godsiff, Mr. Roger
Goldsworthy, Julia
Goodwill, Mr. Robert
Gray, Mr. James
Grayling, Chris
Green, Damian
Greening, Justine
Greenway, Mr. John
Grieve, Mr. Dominic
Hague, rh Mr. William
Hammond, Mr. Philip
Hammond, Stephen
Hancock, Mr. Mike
Hands, Mr. Greg
Harper, Mr. Mark
Harris, Dr. Evan
Harvey, Nick
Hayes, Mr. John
Heald, Mr. Oliver
Heath, Mr. David
Heathcoat-Amory, rh Mr. David
Hemming, John
Hendry, Charles
Herbert, Nick
Hoban, Mr. Mark
Hollobone, Mr. Philip
Holloway, Mr. Adam
Holmes, Paul
Horam, Mr. John
Horwood, Martin
Hosie, Stewart
Howard, rh Mr. Michael
Howarth, David
Howarth, Mr. Gerald
Huhne, Chris
Hunt, Mr. Jeremy
Hunter, Mark
Hurd, Mr. Nick
Jack, rh Mr. Michael
Jackson, Mr. Stewart
Jenkin, Mr. Bernard
Jones, Mr. David
Kawczynski, Daniel
Keetch, Mr. Paul
Key, Robert
Kirkbride, Miss Julie
Knight, rh Mr. Greg
Laing, Mrs. Eleanor
Lait, Mrs. Jacqui
Lamb, Norman
Lancaster, Mr. Mark
Lansley, Mr. Andrew
Laws, Mr. David
Leech, Mr. John
Letwin, rh Mr. Oliver
Lewis, Dr. Julian
Liddell-Grainger, Mr. Ian
Lidington, Mr. David
Lilley, rh Mr. Peter
Llwyd, Mr. Elfyn
Loughton, Tim
Luff, Peter
Mackay, rh Mr. Andrew
Maclean, rh David
MacNeil, Mr. Angus
Malins, Mr. Humfrey
Maples, Mr. John
Maude, rh Mr. Francis
May, rh Mrs. Theresa
McIntosh, Miss Anne
McLoughlin, rh Mr. Patrick
Mercer, Patrick
Milton, Anne
Mitchell, Mr. Andrew
Moore, Mr. Michael
Moss, Mr. Malcolm
Mulholland, Greg
Mundell, David
Murrison, Dr. Andrew
Newmark, Mr. Brooks
O'Brien, Mr. Stephen
Paice, Mr. James
Paterson, Mr. Owen
Penning, Mike
Penrose, John
Pickles, Mr. Eric
Price, Adam
Prisk, Mr. Mark
Pritchard, Mark
Pugh, Dr. John
Randall, Mr. John
Redwood, rh Mr. John
Rennie, Willie
Robathan, Mr. Andrew
Robertson, Angus
Robertson, Hugh
Robertson, Mr. Laurence
Rosindell, Andrew
Rowen, Paul
Ruffley, Mr. David
Russell, Bob
Sanders, Mr. Adrian
Scott, Mr. Lee
Selous, Andrew
Shapps, Grant
Shepherd, Mr. Richard
Simmonds, Mark
Simpson, Alan
Simpson, David
Simpson, Mr. Keith
Smith, Sir Robert
Spelman, Mrs. Caroline
Spicer, Sir Michael
Spink, Bob
Spring, Mr. Richard
Stanley, rh Sir John
Streeter, Mr. Gary
Stuart, Mr. Graham
Stunell, Andrew
Swayne, Mr. Desmond
Swinson, Jo
Swire, Mr. Hugo
Syms, Mr. Robert
Taylor, Mr. Ian
Tredinnick, David
Turner, Mr. Andrew
Tyrie, Mr. Andrew
Vara, Mr. Shailesh
Viggers, Peter
Villiers, Mrs. Theresa
Walker, Mr. Charles
Walter, Mr. Robert
Waterson, Mr. Nigel
Watkinson, Angela
Webb, Steve
Weir, Mr. Mike
Widdecombe, rh Miss Ann
Wiggin, Bill
Williams, Mark
Williams, Mr. Roger
Williams, Stephen
Willott, Jenny
Wilshire, Mr. David
Wilson, Mr. Rob
Winterton, Ann
Winterton, Sir Nicholas
Wishart, Pete
Yeo, Mr. Tim
Young, rh Sir George
Younger-Ross, Richard
Tellers for the Ayes:
Mr. John Baron and
Jeremy Wright
NOES
Abbott, Ms Diane
Ainger, Nick
Ainsworth, rh Mr. Bob
Alexander, rh Mr. Douglas
Allen, Mr. Graham
Anderson, Janet
Armstrong, rh Hilary
Atkins, Charlotte
Austin, Mr. Ian
Austin, John
Bailey, Mr. Adrian
Balls, rh Ed
Banks, Gordon
Barlow, Ms Celia
Barron, rh Mr. Kevin
Battle, rh John
Bayley, Hugh
Beckett, rh Margaret
Begg, Miss Anne
Bell, Sir Stuart
Benn, rh Hilary
Benton, Mr. Joe
Berry, Roger
Betts, Mr. Clive
Blackman, Liz
Blackman-Woods, Dr. Roberta
Blears, rh Hazel
Blizzard, Mr. Bob
Blunkett, rh Mr. David
Borrow, Mr. David S.
Bradshaw, Mr. Ben
Brennan, Kevin
Brown, Lyn
Brown, rh Mr. Nicholas
Brown, Mr. Russell
Browne, rh Des
Bryant, Chris
Buck, Ms Karen
Burden, Richard
Burgon, Colin
Burnham, rh Andy
Butler, Ms Dawn
Byers, rh Mr. Stephen
Byrne, Mr. Liam
Cairns, David
Campbell, Mr. Alan
Campbell, Mr. Ronnie
Caton, Mr. Martin
Cawsey, Mr. Ian
Challen, Colin
Chaytor, Mr. David
Clapham, Mr. Michael
Clark, Ms Katy
Clark, Paul
Clarke, rh Mr. Tom
Clelland, Mr. David
Clwyd, rh Ann
Coaker, Mr. Vernon
Coffey, Ann
Cohen, Harry
Connarty, Michael
Cook, Frank
Cooper, Rosie
Corbyn, Jeremy
Cousins, Jim
Crausby, Mr. David
Cruddas, Jon
Cryer, Mrs. Ann
Cummings, John
Cunningham, Mr. Jim
Cunningham, Tony
Curtis-Thomas, Mrs. Claire
Darling, rh Mr. Alistair
David, Mr. Wayne
Davies, Mr. Dai
Dean, Mrs. Janet
Devine, Mr. Jim
Dhanda, Mr. Parmjit
Dismore, Mr. Andrew
Dobbin, Jim
Dobson, rh Frank
Donohoe, Mr. Brian H.
Doran, Mr. Frank
Dowd, Jim
Drew, Mr. David
Eagle, Angela
Eagle, Maria
Ellman, Mrs. Louise
Ennis, Jeff
Etherington, Bill
Fisher, Mark
Fitzpatrick, Jim
Flello, Mr. Robert
Flint, Caroline
Flynn, Paul
Follett, Barbara
Foster, Mr. Michael (Worcester)
Foster, Michael Jabez (Hastings and Rye)
Francis, Dr. Hywel
Gardiner, Barry
George, rh Mr. Bruce
Gibson, Dr. Ian
Gilroy, Linda
Goggins, Paul
Goodman, Helen
Griffith, Nia
Griffiths, Nigel
Grogan, Mr. John
Gwynne, Andrew
Hall, Mr. Mike
Hall, Patrick
Hamilton, Mr. David
Hamilton, Mr. Fabian
Hanson, rh Mr. David
Harman, rh Ms Harriet
Harris, Mr. Tom
Havard, Mr. Dai
Healey, John
Henderson, Mr. Doug
Hendrick, Mr. Mark
Heppell, Mr. John
Hesford, Stephen
Hewitt, rh Ms Patricia
Heyes, David
Hill, rh Keith
Hillier, Meg
Hodge, rh Margaret
Hodgson, Mrs. Sharon
Hood, Mr. Jim
Hoon, rh Mr. Geoffrey
Hope, Phil
Hopkins, Kelvin
Howarth, rh Mr. George
Howells, Dr. Kim
Hoyle, Mr. Lindsay
Hughes, rh Beverley
Humble, Mrs. Joan
Hutton, rh Mr. John
Iddon, Dr. Brian
Illsley, Mr. Eric
Ingram, rh Mr. Adam
Irranca-Davies, Huw
James, Mrs. Siân C.
Jenkins, Mr. Brian
Johnson, rh Alan
Johnson, Ms Diana R.
Jones, Helen
Jones, Mr. Kevan
Jones, Lynne
Jones, Mr. Martyn
Joyce, Mr. Eric
Kaufman, rh Sir Gerald
Keeble, Ms Sally
Keeley, Barbara
Keen, Alan
Keen, Ann
Kelly, rh Ruth
Kemp, Mr. Fraser
Kennedy, rh Jane
Khan, Mr. Sadiq
Kidney, Mr. David
Kilfoyle, Mr. Peter
Knight, Jim
Kumar, Dr. Ashok
Ladyman, Dr. Stephen
Lammy, Mr. David
Laxton, Mr. Bob
Lazarowicz, Mark
Lepper, David
Levitt, Tom
Lewis, Mr. Ivan
Linton, Martin
Lloyd, Tony
Love, Mr. Andrew
Lucas, Ian
Mackinlay, Andrew
Mactaggart, Fiona
Mallaber, Judy
Mann, John
Marris, Rob
Marsden, Mr. Gordon
Marshall, Mr. David
Marshall-Andrews, Mr. Robert
Martlew, Mr. Eric
McAvoy, rh Mr. Thomas
McCabe, Steve
McCafferty, Chris
McCarthy, Kerry
McCarthy-Fry, Sarah
McCartney, rh Mr. Ian
McDonagh, Siobhain
McDonnell, John
McFadden, Mr. Pat
McFall, rh John
McGovern, Mr. Jim
McGrady, Mr. Eddie
McGuire, Mrs. Anne
McIsaac, Shona
McKechin, Ann
Meacher, rh Mr. Michael
Meale, Mr. Alan
Michael, rh Alun
Milburn, rh Mr. Alan
Miliband, rh Edward
Miller, Andrew
Moffat, Anne
Moffatt, Laura
Mole, Chris
Moon, Mrs. Madeleine
Moran, Margaret
Morden, Jessica
Morgan, Julie
Morley, rh Mr. Elliot
Mudie, Mr. George
Mullin, Mr. Chris
Munn, Meg
Murphy, Mr. Jim
Murphy, rh Mr. Paul
Naysmith, Dr. Doug
O'Brien, Mr. Mike
O'Hara, Mr. Edward
Olner, Mr. Bill
Osborne, Sandra
Owen, Albert
Palmer, Dr. Nick
Pearson, Ian
Plaskitt, Mr. James
Pope, Mr. Greg
Prentice, Bridget
Prentice, Mr. Gordon
Prescott, rh Mr. John
Primarolo, rh Dawn
Prosser, Gwyn
Purchase, Mr. Ken
Purnell, rh James
Raynsford, rh Mr. Nick
Reed, Mr. Andy
Reed, Mr. Jamie
Reid, rh John
Riordan, Mrs. Linda
Robinson, Mr. Geoffrey
Rooney, Mr. Terry
Roy, Mr. Frank
Ruane, Chris
Ruddock, Joan
Russell, Christine
Ryan, rh Joan
Sarwar, Mr. Mohammad
Sharma, Mr. Virendra
Shaw, Jonathan
Sheerman, Mr. Barry
Sheridan, Jim
Simon, Mr. Siôn
Singh, Mr. Marsha
Skinner, Mr. Dennis
Slaughter, Mr. Andy
Smith, rh Mr. Andrew
Smith, Ms Angela C. (Sheffield, Hillsborough)
Smith, Angela E. (Basildon)
Smith, rh Jacqui
Smith, John
Snelgrove, Anne
Soulsby, Sir Peter
Spellar, rh Mr. John
Starkey, Dr. Phyllis
Stoate, Dr. Howard
Strang, rh Dr. Gavin
Straw, rh Mr. Jack
Stuart, Ms Gisela
Sutcliffe, Mr. Gerry
Taylor, Ms Dari
Taylor, David
Thomas, Mr. Gareth
Timms, rh Mr. Stephen
Tipping, Paddy
Todd, Mr. Mark
Touhig, rh Mr. Don
Trickett, Jon
Truswell, Mr. Paul
Turner, Dr. Desmond
Turner, Mr. Neil
Twigg, Derek
Vis, Dr. Rudi
Walley, Joan
Waltho, Lynda
Watson, Mr. Tom
Watts, Mr. Dave
Whitehead, Dr. Alan
Williams, rh Mr. Alan
Williams, Mrs. Betty
Wilson, Phil
Winnick, Mr. David
Winterton, rh Ms Rosie
Wood, Mike
Woodward, rh Mr. Shaun
Woolas, Mr. Phil
Wright, Mr. Anthony
Wright, David
Wright, Mr. Iain
Wright, Dr. Tony
Wyatt, Derek
Tellers for the Noes:
Alison Seabeck and
Mark Tami
Question accordingly negatived.
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