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23 Jun 2008 : Column 23

European Council

3.35 pm

The Prime Minister (Mr. Gordon Brown): With permission, Mr. Speaker, I should like to make a statement about the European Council held in Brussels that I attended with the Foreign Secretary on 19 and 20 June. The main business of the Council on Thursday and Friday evening was to focus on the economic challenges ahead—the triple challenge of rising oil prices, rising food prices and, because of the credit crunch, the rising cost of money—and, in the wake of the US downturn, on measures to keep the European economy moving forward.

Important conclusions were also reached on the Irish referendum, on climate change, on the millennium development goals and on the European response to the deteriorating situation in Zimbabwe. On Thursday evening, in the discussion on the Irish referendum vote, the Irish Taoiseach, Brian Cowen, offered to the Council meeting in October a report on the next stage for Ireland. The Council held that other member states will continue with their ratification processes and I was able to report for the UK that—like in 18 other countries—the Lisbon treaty had completed its parliamentary process and that the Bill received Royal Assent on Thursday. Once we have received the judgment in the ongoing legal case, we will move to ratification.

This time last year the price of oil was about $65 a barrel. At the last European Council in March it stood at $107. At the June Council, the oil price had risen further still to more than $135 a barrel. The global challenge that we face is a rising demand for oil—particularly from China and the other emerging economies now and in the future—that has so far been only partly met by an increase in supply, driving up fuel bills for families across the whole of Europe. Governments are taking action domestically to help—including our winter allowance and the new agreement that we have signed with utility companies for low-income households—but we know that those are ultimately global problems that require global solutions. The shared European view is that we must take action to reduce our dependence on oil and to improve our energy efficiency.

The new technology of carbon capture and storage will help us continue to use coal, oil and gas in a way that avoids harmful emissions, so earlier this year we reiterated our commitment to move forward with up to 12 commercial scale carbon capture and storage plants by 2015. Last week, accepting UK arguments about the importance and urgency of the matter, the Council called on the Commission to bring forward an incentive mechanism to achieve that goal. Britain is ready to have the first such plant in Europe.

Transport will account for two thirds of future increases in oil demand so improving fuel efficiency and exploring alternatives to petrol and diesel is essential to incentivise innovation among car manufacturers. The UK will continue to push for a commitment to an EU-wide car emissions target of 100 g per kilometre by 2020—down from 160 g, and a 40 per cent. reduction—saving the British family about £500 a year in fuel costs. At Britain’s urging, the Council also agreed to explore the scope to accelerate the introduction of commercially viable electric vehicles and the infrastructure that their widespread use
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would require across the EU. Generating electricity is significantly less carbon intensive than using oil, and with all major car manufacturers—including all UK-based ones—now close to developing commercially viable hybrid and electric vehicles, they have the potential to reduce our dependency on oil and our carbon emissions as well as to create thousands of jobs in the British automotive industry.

All those measures will help to meet our overall target of reducing carbon emissions by 20 per cent. by 2020—or by 30 per cent. as part of a wider international agreement—but these decisions are made in the context of a dialogue between oil producers and consumers, where both should commit to greater transparency and a better balance between supply and demand. The Council therefore welcomed Saudi Arabia’s high-level meeting between oil producers and consumers, which I attended, in Jeddah this weekend. I am today writing to all European leaders to inform them of the results of the Jeddah process, which will lead to a follow-up summit in London later this year. I can tell the House that the summit discussed measures to deliver a more sustainable global oil price, to reduce the risks and uncertainty that can increase prices and to ensure greater investment in oil production as well as energy efficiency and alternatives to oil.

I proposed that Britain and other oil consumers should open up our markets to new investment from oil producers in all forms of energy, including renewables and nuclear, providing all producers with a long-term future in non-oil energy. In return, oil producers should be open to increased funding and expertise in oil exploration and development through co-operation with external investors, providing increased oil supply in the medium term while growing economies adjust to a less oil-intense long-term future. The House will know that Saudi Arabia announced at the summit its increases in oil production.

The prices of rice and wheat are now double what they were only a year ago. Higher food prices cause concern to many of us here at home, but in poor countries, where food often accounts for more than half a family’s spending, they can be even more devastating. To tackle rising prices both here and overseas and to help boost agricultural production, the Council agreed to implement the conclusions of the Rome food summit. It also agreed to assess the evidence of the indirect impact of biofuel, and the UK’s Gallagher review on the indirect impact, due to report shortly, will be part of that process.

We also committed to work towards a successful outcome to the Doha trade round, where eliminating trade-distorting subsidies and import restrictions could increase global gross domestic product by as much as $300 billion a year by 2015. That is something that I have discussed with President Bush, President Lula, Chancellor Merkel and President Barroso as well as with the European Trade Commissioner, Peter Mandelson, in recent days. I believe that while we are at the eleventh hour in getting a trade deal, a trade deal is definitively within our grasp.

The European Union must take action on the elements of the common agricultural policy that raise the cost of food for consumers across Europe. Removing incentives for taking arable land out of production, for example,
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could reduce cereal prices by up to 5 per cent. The Council agreed to re-examine the issues of fair competition and sustainable agriculture.

As part of the year of action on the millennium development goals, and ahead of the G8 in July and the United Nations meeting in September, the European Council signed up to an agenda for action that reaffirms EU aid targets and sets specific milestones for the developing countries, to be achieved by 2010: increased European investment of €4 billion to recruit 6 million more teachers, and, on health, an extra €8 billion to help save 4 million children’s lives and provide for 75 million more bed nets against mosquitoes in Africa. I will be pushing the G8 in July to ensure that we have as a world the 120 million nets that we need, so that every child in every family in the world is able to sleep safely at night. The Commission has also agreed to establish millennium development goal contracts, linking European Union spending to specific and agreed outcomes by developing countries, that will secure value for money. I am pleased to announce a British contribution of £200 million to that fund.

The Council also discussed the deteriorating political and humanitarian situation in Zimbabwe. In recent weeks under Mugabe’s increasingly desperate and criminal regime, Zimbabwe has seen more than 80 killings, 2,700 beatings, the displacement of 34,000 people and the arrest and detention of Opposition leaders, including Tendai Biti and Morgan Tsvangirai. In the face of that unacceptable situation, the European Council reiterated its readiness to take further measures against those responsible for the violence. We will seek to impose travel and financial sanctions on those in the inner circle of the criminal cabal running the regime.

The House knows that since the Council met last week, the situation has deteriorated further still. As a number of African Presidents and Ministers have already stated, the regime has made it impossible to hold free and fair elections in Zimbabwe, and state-sponsored terror and intimidation have put the Opposition in an untenable position. Our thoughts are with the people of Zimbabwe, who are facing an unprecedented level of violence and intimidation from the regime. The whole world is of one view: that the status quo cannot continue. The African Union has called for the violence to end. The current Government—with no parliamentary majority, having lost the first round of the presidential elections and holding power only because of violence and intimidation—are a regime who should not be recognised by anyone.

The UN Security Council will meet later today. The Foreign Secretary will make a detailed statement in a few minutes following the discussions that he and I, and my right hon. Friend the Minister for Africa, Lord Malloch-Brown, have held with African leaders. Today, I have talked to the United Nations Secretary-General, Ban Ki-moon; to the president of the African Union, Mr. Kikwete; to the President of South Africa; and to Morgan Tsvangirai himself. Members of the Southern African Development Community and the African Union leadership will want to meet to discuss the emergency. We understand that there are plans for meetings very soon, and we support that happening quickly.

We urge that SADC observers’ evaluations of the seriousness of the situation on the ground be made public immediately so that the whole world can witness
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the truth about what has been happening. We urge that the UN and the African Union work together with SADC to send envoys and a mission to Zimbabwe to discuss the situation on the ground and the way forward. We believe that the UN envoy should be allowed to return immediately to examine the human rights violations. The international community must send a powerful and united message: that we will not recognise the fraudulent election rigging and the violence and intimidation of a criminal and discredited cabal. We are ready to offer substantial help for the reconstruction of Zimbabwe once democracy has been restored.

The Council also expressed its ongoing concern about the humanitarian situation in Burma in the aftermath of the cyclone and called for a return to democracy and the immediate release of Aung San Suu Kyi and other political prisoners. We made clear our continued determination to play a leading role in ensuring peace and stability in Kosovo.

Our national interest is, and remains, a strong Britain in a strong European Union. We will continue to focus on an outward-looking European agenda that tackles in an effective way the global, economic, environmental and development issues that affect us all. That is what the Council sought to do at its June meeting, and that is what the Government will be doing in the run-up to the French presidency that starts in July. I commend this statement to the House.

Mr. David Cameron (Witney) (Con): May I first welcome what the Prime Minister said about the millennium development goals and about Burma?

On Zimbabwe, we welcome what the Prime Minister says about the EU widening sanctions on members of that regime, but will he make sure that it really happens this time? Will the Government press for a UN commission of inquiry into the abuses of human rights, with a view to future action by the International Criminal Court? Vitally—he hinted at this, but perhaps he could go further—will he set out a detailed rescue package for the post-Mugabe era to make it absolutely clear that when Mugabe goes we will do all that we can to breathe new life into that country and into those people who have suffered so much? But is not there something else that we can do? Should not we now make it clear that we are prepared to withdraw international recognition from Mugabe’s regime to say to him and his henchmen: “You are no longer the legitimate Government of the country you are terrorising”? The Foreign Secretary shakes his head, but the Prime Minister’s statement was so opaque that perhaps he can be a little bit clearer in his reply about withdrawing recognition. If he rattles these things off like a machine gun, it is extremely difficult for people to follow things. Let me take this nice and slowly so that he can concentrate.

Let me turn to the cost of living. There are three key policy areas where the EU has real power to affect the cost of living—free trade, reforming agriculture and, crucially, keeping its own costs under control. On that basis, was not the European Council a huge disappointment? On free trade, there was nothing more than platitudes. There was no new action on the common agricultural policy, and not a mention of the EU keeping its own costs under control. Meanwhile, at a time of rising living costs, have not our own Government given up £7 billion of our rebate—taxpayers’ hard-earned money—with nothing in return?

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The Prime Minister rightly focused on the price of oil and the need to encourage renewables and new technology. We welcome what he says about the 100 g carbon dioxide target for new cars by 2020—that is, I can announce, another Conservative policy introduced by this Government. Given his enthusiasm, though, why is he going ahead with the Kingsnorth coal-fired power station without carbon capture and storage, why has he done so little on tidal and wave power, and why is he dragging his feet on feed-in tariffs? Clearly, the supply of crude oil is important, but what is he proposing to do about the danger that prices are being driven higher because financial institutions are investing so heavily in commodities, including oil?

At the heart of this European Council was the issue of the Irish referendum. The Prime Minister said so little about Ireland, I thought that he was about to tell us that it was a far-away country of which we know little. Did not the Prime Minister face a very clear choice? He could have done the difficult thing and declared the treaty dead, or he could have done the easy thing, and joined others in starting the process of bullying Ireland into a second referendum. Is it not the case that in taking the latter path, he has let down the people of Ireland, let down Britain and let down Europe? Can the Prime Minister really explain why he has done this?

Governments of this country, whether Labour or Conservative, have never wanted a European constitution, with a European President, a European Foreign Minister and a European diplomatic service. Even Tony Blair was clear, when the process started, in saying that he did not want a constitution. The Prime Minister has only ever attempted to sell the treaty on the basis of what he has opted out of, rather than anything positive in the document. So why, when the only people given the chance to speak say no, does he fail to show any leadership? Even Tony Blair was better than this. When France and the Netherlands voted the treaty down in its original form, Tony Blair halted ratification and said that people were

Why did the Prime Minister not give the same sort of lead following the Irish vote? [ Interruption.] I have not only read the treaty; I have also looked at your website.

Is it not the case that anyone arguing against this treaty is met with four entirely bogus arguments? First, the Government say that it is time to stop talking about institutional reform. If that is the case, what is the Prime Minister doing supporting a new institutional treaty? Secondly, he said last week that the treaty is absolutely essential for enlargement. Is it not the case that that is simply untrue? The Labour Chairman of the Foreign Affairs Committee—I am glad to see him in his place—has said that that is

Instead of giving cover to those who want to slow down or halt the enlargement process, will the Prime Minister correct that statement today? Thirdly, he says that if the treaty is killed off, we would be isolated in Europe. But is that not wrong too? On our side, against this steady creation of a European state, are the Dutch voters, the French voters and now the Irish voters.

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Is not his final argument the most bogus of all? He says that any party that chooses to talk about the loss of national vetoes, the dangers of a European superstate or giving people a vote in a referendum is somehow backward-looking and indulgent in old politics. Does he not see that what is backward-looking is the political elite in Brussels, endlessly coming up with new powers to transfer to a European Union without giving anyone a say? In every other walk of life, people are being given more control, more choice and more freedom. That is the new politics. When is the Prime Minister going to wake up and realise that the European Union is going in entirely the wrong direction?

A year ago, the Prime Minister stood on the steps of Downing street and said that he would protect the British way of life, build trust in government and bring the change that could not

But let us look at what he has done: he has brought back a constitution, pretending it is a new treaty—[Hon. Members: “No!”] Yes. He is taking part in the bullying of a small country that has voted against it, and insisting on driving through the treaty without allowing the British people a say on it. Half-truths, ignoring democracy, breaking promises and shutting people out when they should be given a say: can you get any more old politics than that?

The Prime Minister: Let me start with Zimbabwe. We all know about the deterioration of the situation—on that, we are agreed—but I would like the House to know the extent to which we will work with other countries to try to find a way forward for the people of Zimbabwe that avoids violence, brings an end to intimidation and allows them to have a fully democratic Government in their country.

It is right that sanctions have been placed against the bank accounts of 130 people. It is also right that the European Union, at our prompting, is considering further financial and travel sanctions not only against those individuals, but against others and their families. We know the names of the people responsible for running the criminal cabal surrounding Mugabe in Zimbabwe, and we are determined to force through the sanctions and to track down the money that is in their accounts in other countries.

It is also right that we are taking action through the Security Council. I spoke to the Secretary-General earlier this afternoon, and it is right that the Security Council expresses, through a presidential statement, its distaste for what has happened, its desire for an end to violence and its call for democracy to be restored in Zimbabwe. I have spoken to the other African leaders, as has the Foreign Secretary and the Minister for Africa. Many of those leaders signed a statement last week, calling for democracy in Zimbabwe, and they, too, are appalled by the recent turn of events and understand the frustrations that have led the opposition party to pull out of the elections, but they want a positive way forward that avoids an extension of the violence. I call on the African Union and the Southern African Development Community, working with the United Nations, to send a mission to Zimbabwe so that we can see a way forward from today’s events.

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