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“this provision is unnecessary as all aspects of energy policy are effectively covered elsewhere in the Treaty”
such as under the “single market” and the “environment”.
That was the Government’s argument.
This is a central fact in the debate. In their own words, the Government have admitted that the treaty adds nothing that we actually need. It brings no benefit at all. The Government were right then and are wrong now, and have yet to explain why they let this article go through in the negotiations, other than because they negotiated poorly. We do not need this to act together on the environment, an area where the European Union has an important role to play. The emissions trading scheme is far from perfect, but it is up and running, and we have not needed this treaty to do that or to reform it.
Martin Horwood (Cheltenham) (LD) rose—
Mr. Francois: I give way to the federalist wing.
Martin Horwood: The hon. Gentleman seems to be making an argument that energy policy was present in the previous treaties and was being implemented in various ways. Was it then in fact, if not in name, a shared competence?
Mr. Francois: I understand that in energy market liberalisation the Commission has mainly relied on article 95 of the treaty establishing the European Community, which deals with competition and markets generally. I understand that it has been using that successfully to help to bring about energy market liberalisation, and that the competition directorate-general has been quite aggressive in that regard. We do not need the new powers in the Lisbon treaty to press forward energy market liberalisation.
We heard in the earlier part of the debate, but it bears repetition, that last September the European Commission launched the third legislative package on electricity and gas markets. Its package headline says that it will
“ensure that all European citizens can take advantage of the numerous benefits provided by a truly competitive energy market.”
If the European Commission not only admits but boasts that it is able to achieve the goal of a truly competitive energy market in the EU—a goal that we firmly support—using only the EU’s current treaties and powers, it is fatuous for Ministers to claim that this energy article is needed or that opposition to it or to the treaty as a whole shows any lack of support for or seriousness about a single market in energy. If people do not believe me, they should ring not Conservative headquarters but the European Commission and ask it.
Article 176A is a source of concern. In particular, it is not clear to what kind of legislation paragraph 1(b), on ensuring the security of energy supply, will lead. Ministers have not been clear about that either. That was touched on earlier, but again I do not think we achieved absolute clarity.
Rob Marris (Wolverhampton, South-West) (Lab) rose—
Mr. Francois: On that point I give way to the hon. Gentleman. We are both veterans of Finance Bill debates, so I am pleased to cross swords with him again. Whichever bit of the document he is going to read out, would he please give us the clear reference?
Rob Marris: I may surprise the hon. Gentleman on this occasion by not reading out part of a document. The argument that I understand him to be making is one to which I referred earlier in the themed debate. He seems to be saying that the bit he seeks to remove via his amendment is redundant in the treaty. I am not sure that I agree with that argument, although I understand it. He then seems not to follow the logic of that. I think he was here when I mentioned looking through the telescope the wrong way. If the piece that he seeks to remove were included, would it put a brake on the liberalisation that the House generally agrees that we wish? I understand the argument about redundancy—as a lawyer, I perhaps like it—but looking at it in the round, one has to ask whether it is really a problem if the provision were included. He says that we can have liberalisation under existing treaties, agreements and so on—that might well be the case—but is it a problem if it is in this treaty anyway? Would there be a downside, apart from inelegant wording and redundancy?
Mr. Francois: The hon. Gentleman knows that I have a lot of time for him, and I have to tell him that there would be a problem. He ought to ask his own Front-Bench team about this, because they clearly thought there was a problem when they tried to oppose the measures so firmly in the first place. If there is no problem, why were the Government arguing to have these powers taken out of the treaty when it was first negotiated? Perhaps he would have a quiet word with the Minister in the Tea Room later.
Mike Gapes (Ilford, South) (Lab/Co-op) rose—
Mr. Francois: I am going to make a little progress, because other hon. Members wish to speak and we only have an hour and a half. I shall then give way to the Chairman of the Foreign Affairs Committee.
More worrying is the effect that article 176A could have on the long-established Community doctrine of implied competence, to which reference has been made. It would not be advantageous to this country if the EU had effective sole competence to make agreements on energy supply with third countries—our energy relationship with Norway is a case in point. The principle of shared competence on energy, the new article specifically on energy and the legislation that would undoubtedly flow from that would tend to eat away at our right to conclude such agreements. At this point I gladly give way to the Chairman of the Foreign Affairs Committee, not least because I remember that he was present when I made my maiden speech in this House.
Mike Gapes:
And it was a very good speech. The hon. Gentleman referred to the importance of energy security. Does he agree with the unanimous view of the
Foreign Affairs Committee in our report on Russia, published in November last year, that we should welcome the increasing moves towards diversification of energy sources by the European Union, and any measures that we take to strengthen a coherent and more robust collective EU approach towards Russia and how it tries to use energy as a political weapon?
6 pm
Mr. Francois: The Chairman of the Foreign Affairs Committee asks whether we agreed with “any measures”, and that is a question in principle. The answer in principle is that we do not agree with “any measures”; we are here to debate the detail of the treaty line by line. The Chairman attempts to inveigle me, but he will have to forgive me if I do not walk into his little trap. I will say, however, that I do agree with the conclusion of the Committee’s other report that, on foreign affairs, the constitution and the Lisbon treaty were almost exactly the same.
The treaty’s provisions on energy sum up much of what is wrong with the treaty as a whole. The provisions are unneeded and unwanted, and their presence is testimony to the Government’s utter ineptitude at negotiating in the EU. The provisions offer no benefit to this country and neither we nor our European partners would be harmed by their rejection. They only have the potential to harm, and that is why we have tabled the amendment to reject them this evening.
Mike Gapes: I wish to make a few points about the importance of an EU-co-ordinated European energy approach. The realities of the coming decades will be such that energy will be one of the most important issues in international relations. It will be a global geopolitical issue.
I referred in my intervention a moment ago to the Foreign Affairs Committee’s report on global security and Russia, which is relevant to this debate. In that report, we highlighted the fact that for many years to come, Russia will be dependent on European Union markets for its gas and oil. Russia will need to export that energy, and it will not be able to diversify sufficiently quickly in terms of exports to China and other parts of the world. Russia will depend on the currency that it will get from its sales to the European market.
At the same time, European member states have had different approaches to energy supply. We had the controversy over the pipeline to Germany under the Baltic sea, which caused great difficulties in the relations between the German Government and the Poles and Lithuanians. Another issue is the supply of gas from southern Europe. For all those reasons, the amendments do not take account of the realities that the European Union confronts. I am therefore not in favour of the amendments and I hope that we will support the treaty as it stands. It will take us forward to a more coherent and co-ordinated approach, both in the internal market of the European Union and, more importantly, to the issues of diversification and energy security in relation to the major energy producers in the world. That does not just mean Russia; it includes how we deal with north Africa, the Gulf and the countries in the Caspian area, which are all potential sources of
energy supply for the EU. The UK is rather more advantaged than some countries: we have a long-term relationship with Norway, liquefied natural gas from Qatar is coming on stream, and we will have other sources of supply. Those in central and eastern Europe are more dependent on gas and oil from Russia.
Mr. Bone: Do I understand the hon. Gentleman’s argument correctly: because Germany and Poland disagreed on an energy matter, there should be a European competency that forces the European view, whatever it is, on to the nation states? Is that not an argument for a superstate?
Mike Gapes: No, that is a complete misrepresentation of what I said. My argument is that because there are divisions within the EU, Russia is able to pick off individual EU member states, bully smaller countries and even attempt to bully some larger ones. Some countries have gone along with that to some extent. It is deplorable that the Russian Government have bullied Estonia and Lithuania. They have even bullied the UK over matters unrelated to energy, such as the British Council and the murder of Mr. Litvinenko.
Mr. Hendrick: Energy is not only a green issue now; Stern showed that it is an economic issue as well. Now, because of climate change and the fact that it can also cause wars, energy is a security issue. That is why the EU acting with a shared competence on the matter is so important.
Mike Gapes: My hon. Friend is absolutely right. The EU united with a common voice can stand up to Russia and say that Russia’s behaviour is unacceptable. Similarly, it can act in climate change and world trade negotiations and many other spheres much more effectively than the individual states alone could act. No matter how big a country—whether its population is 80 million, like that of Germany, or 60 million, like that of the UK, Italy and France—it cannot have the weight of the collective of 400 million or 500 million people. In a world where the economic focus is shifting to Asia, the only way that we as Europeans will be able to have an effective voice in this century, which will see the rise of countries such as India, China and Brazil alongside the existing US economy, is collectively, using our international networks and policies.
Mr. Nigel Evans (Ribble Valley) (Con): The hon. Gentleman’s argument this evening is an argument for scrapping the borders around 27 countries and introducing the united states of Europe. That is exactly what we do not want.
Mike Gapes: And nor do I. When Baroness Thatcher was signing up to the Single European Act, which did more to scrap borders in Europe than any other action since the holy Roman empire, the hon. Gentleman should have been making that argument and voting against the legislation.
Martin Horwood:
It is good to serve under your chairmanship, Sir Michael, and rewarding to see the House of Commons at its best today. We have seen the cut and thrust of debate, with attempts to outwit and
challenge Front Benchers made by Back Benchers—and that is only on the Conservative Benches. [ Interruption. ] I interpret the absence of Back Benchers from my party as meaning that they see no need to challenge me from behind—unlike the Conservative Front-Bench spokesman, who suffered during the earlier debate.
The Conservative amendments are unnecessary, because they are based on the nonsense that we have heard from Conservative Members today—that the treaty opens the way for draconian EU action on energy, crushing national interests before it. Rather closer to the mark are the remarks of WWF, the Green Alliance and the Institute for European Environmental Policy, which praise the treaty, saying that
“It emphasises climate change and makes it easier to adopt greener energy policies.”
Mr. James Clappison (Hertsmere) (Con): Perhaps I can serve as a substitute for the Back Benchers that the hon. Gentleman does not have. Does he share my scintilla of doubt about why the Government oppose the measures that he is praising and they have put forward as a good thing?
Martin Horwood: That is not for me to answer. The hon. Gentleman should ask the Minister. [Interruption.] I have no idea why the Government would change their position on any measure. It is up to them to answer that.
The WWF, the Green Alliance and the Institute for European Environmental Policy called the changes in article 176 “momentous”, not because it establishes the list of shared competences, but because it
“will empower the institutions to adopt Directives and Regulations not only for the sake of the internal energy market, but also to ensure security of supply and”—
this is key for those organisations—
“to promote energy efficiency and energy saving and the development of new and renewable forms of energy.”
Those groups are clarifying the fact that it is the policy direction contained in the treaty which is significant. It is important to identify energy as a shared competence. No great new powers are being conferred; there is just a new and clearer direction. WWF and the others are worried that the red lines that the Government have negotiated have conceded too much. Their statement goes on to say that the new energy article
“shall not affect a Member State’s right to determine the conditions for exploiting its energy resources, its choice between different energy sources and the general structure of its energy supply...This limits the scope for ambitious EU initiatives on energy policy, including those with environmental goals...many measures that would be relevant from a sustainable development perspective are bound to affect the choice between different sources of energy; in fact that is their very purpose.”
Conservative Members were worried about removing descriptions of unrestricted competition, but in one sense Stern has told us to intervene in the market and influence it in a way that helps the planet and the future economy, so that proposal is not surprising.
I support the red lines. They are important provisions and should remain, but the environmental
organisations’ concerns illustrate how far from reality the position of Conservative Front Benchers is, and how unnecessary the amendments are.
Mr. Graham Brady (Altrincham and Sale, West) (Con): Given that the words and provisions of the treaty do matter, especially as we are discussing them in Committee, is the hon. Gentleman not concerned that article 176 would give the EU power to prevent Gazprom from buying energy providers in the EU?
Martin Horwood: There is a common misunderstanding on the Conservative Benches that shared competences mean European competences. Shared competences are clearly defined in the treaty: they are shared between the European Union and the member states. There is nothing in the treaty that suggests to me that they will be used against the interests of member states.
Martin Horwood: I would not mind getting on to the amendments— [Interruption.]
The Second Deputy Chairman: Order. If hon. Members are attempting to give way, it would be helpful if they indicated clearly—yes or no. Then the Chair will know what to do. Is the hon. Gentleman giving way?
Mr. Francois: On the shared competences, member states can continue to legislate in those areas if the EU decides not to, but if it decides that it wants to, we cannot. That is in essence what a shared competence means. Does the hon. Gentleman understand that?
Martin Horwood: The situation with qualified majority voting is not fundamentally changing— [Interruption.] There is, in effect, a shared competence now. All the treaty does is to define clearly which are the shared competences, and to make that a clearer forum for policy making. That is what the green organisations are praising, and that is the advantage of the treaty. There is not the massive shift of power that the hon. Gentleman seems to fear.
Ms Patricia Hewitt (Leicester, West) (Lab): May I add to the hon. Gentleman’s response to the hon. Member for Rayleigh (Mr. Francois)? The point is surely that new article 3b of the Lisbon treaty, on page 13, says:
“Under the principle of subsidiarity, in areas which do not fall within its exclusive competence, the Union shall act only if and insofar as the objectives of the proposed action cannot be sufficiently achieved by the Member States”.
In other words, the shared competence means that member states will act as they choose, and the Union will act only if it is required to do so because national action will not achieve the agreed objectives.
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