Examination of Witnesses (Questions 180-199)
RT HON.
DAVID MILIBAND
MP AND MATTHEW
RYCROFT CMG
17 JUNE 2009
Q180 Ms Stuart: It might be quite
helpful for the Committee to have some of the political things
which we may welcome which can be whether or not you need the
treaty basis.
David Miliband: We can look at
that.
Q181 Ms Stuart: Can the Foreign
Secretary tell us what the British Government's position would
be if we get to October and the Lisbon Treaty is still in limbo?
We have to make Commission appointments. We have to make a number
of MEPs. We are into a period of extraordinary uncertainty. There
must be some preparations on what the Government's position would
be.
David Miliband: We are making
preparations for what happens if Lisbon goes through and we are
making provisions for what happens if Lisbon does not go through.
The third way is where there is some kind of tie in the Irish
referendum or a hanging chads limbo. I am pretty sure that we
have not made any preparations for a hanging chads situation in
the Irish referendum. So either it will come into force or it
won't come into force. I don't think there is a third way on this
one.
Ms Stuart: What a shame.
Q182 Mr. Pope: We live under Nice
but prepare for Lisbon. Those two treaties provide for different
numbers of members of the European Parliament. Transitional arrangements
were agreed at the last European Council. Spain appears to have
reservations about that. If the Lisbon Treaty is ratified later
this year, what happens to the European Parliament? Will it go
ahead and have an increased number of MEPs or will it require
another intergovernmental conference?
David Miliband: We agreed to that.
I am not sure that Spain has reservations. I think it is rather
enthusiastic about reforming the number of MEPs because it gets
four more.
Q183 Mr. Pope: I don't mean political
reservations. I think it has legal reservations as to whether
it will be binding. It has put forward two alternatives: one for
an IGC or one for an amendment to an accession protocol for Iceland
or Croatia. Will that be discussed at the European Council and
do we have a view?
Matthew Rycroft: It was discussed
at the December European Council which agreed that if we were
in this scenario, in other words if the Lisbon Treaty entered
into force, then the Spanish wish to have this increase in the
number of MEPs before waiting for the next European Parliament
elections in 2014 could come in. For that to take effect we obviously
need to wait for the Lisbon Treaty to come into force. But it
would require an IGC.
Q184 Mr. Pope: It would require
an IGC. What is the British view on whether this is desirable?
Some member states think that it would be desirable for these
to be the full extra 18 MEPs. Some think that they should just
have observer status.
David Miliband: Either they are
in or they are out—I don't think you can have half an MEP.
Q185 Mr. Pope: That is admirably
clear. I have one other question. Of these 18 extra MEPs, one
will be from the UK. In which region?
David Miliband: The great thing
about the very malleable British constitution is that it provides
a bolt hole for Governments faced with this question. We have
an Electoral Commission whose happy task it would be to try to
decide where this MEP should come from and also how he or she
should be elected/selected. I have heard of by-election campaigns
that stir the blood but I am not sure that this is one that will
be of massive excitement. There are some difficult babbling brooks
that need to be crossed before we get an answer to that question.
Chairman: Perhaps consideration
can be given towards somebody to represent the Overseas Territories,
given that Gibraltar is represented by the south-west of England
at the moment.
Q186 Sir Menzies Campbell: While
we on the question of appointments, and leaving aside any domestic
considerations, part of the uncertainty plays into the question
of the selection of the next Chairman of the Commission.
David Miliband: President.
Sir Menzies Campbell: I beg your pardon—President
of the Commission. Is that something that you will talk about
this weekend? If so, how do you think it will be resolved?
David Miliband: We talked about
that yesterday in the debate on the European Council in the House.
It will be discussed. The UK position is to support the renomination
of Mr. Barroso. Obviously his presidency would not have a second
term formally until it was ratified by the European Parliament,
because those are the rules of the game. We think that it makes
sense to proceed with his nomination. He has provided strong leadership
for the Commission. We have very clear ideas about the sort of
agenda that needs to be pursued, and it must be pursued decisively.
His experience of his first five years could provide that. I hope
it would mean that in this period of relative uncertainty before
the Irish decision on the Lisbon Treaty is made—
Q187 Sir Menzies Campbell: Are
the French in agreement with that position? Do they not have a
more nuanced position about wanting a formal interim appointment?
David Miliband: As always in the
European machinery, there is more than one way to skin this cat.
There are different political decisions, formal decisions and
legal decisions. There is a bit of to-ing and fro-ing, but it
is clear what our position is and it is clear where the centre
of gravity in Europe is.
Q188 Sir Menzies Campbell: And
you anticipate that the British position will prevail?
David Miliband: I always say to
people who raise the idea that we are one against 26 and that
the British decision will power its way through, that we are important
players, but we are not on our own. We are part of a strong consensus
on how the European Union should go forward.
Q189 Sir Menzies Campbell: I will
put the question slightly differently: do you anticipate that
the position that the British support will prevail?
David Miliband: I think so. I
anticipate that by the end of this week there will be a renomination
of Mr. Barroso.
Q190 Sir Menzies Campbell: What
about Javier Solana's position as High Representative for the
Common Foreign and Security Policy? I think that his appointment
comes to an end on 18 October 2009. Will that be subject to some
discussion?
David Miliband: That depends on
the Lisbon Treaty.
Q191 Sir Menzies Campbell: Because
the whole of that office would have additional responsibility
and he would be double-hatted.
David Miliband: Exactly. As the
high representative, he would combine certain roles. One of the
joys and benefits of the Lisbon Treaty is that it will tackle
the problem that Gisela Stuart identified accurately in yesterday's
debate, which is that the dual representation of European institutions—partly
Council, partly Commission—around the world does not make
any sense. She spoke eloquently about how the Lisbon Treaty will
overcome that problem. That obviously speaks directly to the role
of high representative. It is up to Javier Solana to decide whether
he wants to apply for it.
Q192 Sir Menzies Campbell: Do
you expect any discussion about European security and defence
policy?
Chairman: It looks as though we have
a Division, which was totally unpredictable. We will have to stop
to go and vote. If there is just one Division, we will be back
in 15 minutes.
Chairman: Foreign Secretary, apologies
for the interruption. I believe that you were in the middle of
concluding an answer to a question.
David Miliband: Menzies Campbell
asked me about security and defence policy. We will have the most
direct discussion tomorrow night over dinner when we have a preview
discussion about the OSCE meeting, which is taking place 10 days
later, on so-called European security architecture.
Q193 Sir Menzies Campbell: It's
at the instigation of the Russians, among others, isn't it?
David Miliband: Among others,
yes. We will talk about how the institutions of European security
have served us, and how the balance has been struck between so-called
hard and soft security and the three baskets of the European security
architecture—economic, social and humanitarian, and defence.
That is the context in which it will come up. There is also an
EU-Pakistan summit happening today, and there are some issues
in respect of Afghan security where there may be some discussion.
However, we will not be having a formal review of the operation
in the Gulf of Aden and various other ESDP missions.
Q194 Sir Menzies Campbell: May
I make just one last point on the OSCE? There is some suggestion
that the Russian motive in this is to try to slacken the connection
between North America, Canada and the United States, with European
security. I take it that this is something our Government would
resist in the strongest possible way.
David Miliband: Yes, there is
a slight, "You might expect us to say that, wouldn't you?",
but what is very striking is that President Sarkozy, in his first
response to the Medvedev demand or suggestion of a debate about
European security, said, "It is fine to have a debate, but
be under absolutely no illusions that one foundation of that debate
is unity across the Atlantic, and a second foundation is that
hard and soft security fit together." The way I see it is
that the Medvedev speech, which had these five principles of security,
raises more questions than it answers, notably in respect of the
Russian attitude to the so-called "near abroad", and
secondly of the Russian attitude towards its own passport holders
elsewhere in the world. It is very important that we never say
that we are not willing to have a debate. Instead, we say, "Let
us have a serious debate."
Sir Menzies Campbell: Thank you.
Q195 Sandra Osborne: May I ask
you about the results of the European Parliament elections? Quite
apart from our party's showing, there was only a 34% turnout in
the United Kingdom. The numbers persistently seem to go down and
there is less engagement with the public. Why do you think that
is and what can we do to improve that?
David Miliband: It is a good and
hard question to ask. The answer that I give is that the European
Union has spent seven years talking about its own institutions—its
own plumbing. Organisations that spend time talking about their
plumbing are not ones likely to stir the blood of voters. As it
happens, our turnout did not go down that much this time, but
we have always had a historically low level of turnout. I know
that it is not something to be particularly proud of. I think
that turnout did fall in a number of other European countries.
When I was in Greece two weeks ago, I asked them whether the European
elections would be fought on European issues and they said no.
They had a fall in turnout as well. The European Union's problem
is that when it does things well, there is no reason for people
to talk about it—for example, what it does on mobile phone
charges or on the European rule of law mission in Kosovo. When
it does things badly, it rightly gets coverage. Most importantly,
when it focuses on itself, it does not engage people, and that
is what has happened with the constitution and then the reform
treaty. That would be my explanation of why we have not driven
up interest.
Q196 Sandra Osborne: What about
the election of the two BNP MEPs for the UK? What engagement,
if any, will the Government have with them?
David Miliband: I said yesterday
in the House that we would provide the very basic service that
goes to all MEPs from Britain. They get a written brief on what
the Government's position is, but they won't get anything more
than that. Many people in Britain of all political views feel
a sense of shame and disgrace about the fact that far-right extremists
have now been added from Britain to the far-right parties that
have been elected from other European countries before. I think
that I am right in saying that the BNP vote didn't actually go
up, but the lower turnout from our party contributed to the BNP
getting elected. It is demeaning for this country, which has been
in the vanguard of the fight against racism and fascism for a
very long time, to have two BNP MEPs. I think that it is a sobering
warning to the rest of us about how we conduct our politics and
how we engage with our voters. There is no such thing as the friendly
face of fascism. We have to make sure that we learn the right
lessons, and I am sure that is something the whole Committee agrees
with.
Q197 Sandra Osborne: What about
the structure of the results overall, with the shift to the right
and the rise of nationalism generally? How will that affect the
UK Government's engagement with the European Parliament, if at
all?
David Miliband: Fortunately, from
our point of view, given our party political leanings, the rise
in the number of European People's party MEPs is compensated for,
or annulled, by the bizarre/insane/delirious decision of our political
opponents to leave the EPP and go off on their own into a sect
of—what did Ken Clarke call them?—hare-brained nutters.
Sir Menzies Campbell: Don't be so objective.
David Miliband: That means that
the EPP has no more seats than it had two weeks ago, not because
its parties didn't win more seats, but because the British Conservatives
chose to opt out of the EPP group. I think that points to a more
fragmented European Parliament, and a European Parliament in which
it will be harder to get majorities. It will also be a Parliament
in which British influence is reduced, because the new sect will
not have the speaking rights, the chairmanships or the positions
as spokesmen that would be associated with being members of the
EPP. But I think that overall, there is a big challenge to the
European Parliament to make sure that it does not just become
fragmented and factional.
Chairman: Before we move on to international
issues outside the immediate context, David Heathcoat-Amory wants
to come back on another point.
Q198 Mr. Heathcoat-Amory: I want
to raise the question of financial regulation, because there are
some big decisions coming up in the European Council on that.
As you know, the City is very worried about the current transfer
of authority for regulation from domestic to EU level. Your memorandum
to the Committee states: "It is important for the UK that
supervision should remain a national responsibility". I think
that we all agree on that. Lord Myners, the Treasury Minister,
has expanded on that publicly, and in a letter to the European
Scrutiny Committee he emphasised that very explicitly.
It is rather alarming to read in the draft conclusion
that there is to be a new system of financial supervisors and
three new European supervisory authorities working as an operational
European network. It explicitly states that "their duties
will include supervision at the level of the individual financial
firm". It seems that, even before the Council has met, we
have run up the white flag on that and are agreeing to a supervisory
level, which contradicts both what you have said to us in your
memorandum and what Lord Myners has said in a letter to another
Committee.
David Miliband: I don't think
so, actually. That shows the perils of being guided by draft conclusions
published on Danish websites. If you look at the meeting of Finance
Minsters on 9 June, which did come up with public conclusions,
you will see that they were absolutely clear that supervision
and the arrangements for fiscal support to individual financial
institutions in times of crisis must remain aligned. In other
words, national fiscal responsibility and national institutional
issues must be properly aligned, avoiding the sort of confusion
that I think you fear.
You were at the debate yesterday, and we went
through in some detail the fact that there are two different sets
of issues, which might have been confused at the beginning of
your question. One of them relates to financial supervision, and
the other relates to hedge funds and other regulatory issues,
which will be discussed over a much longer term, rather than at
the meeting tomorrow. With regard to the meeting tomorrow, I point
you to the 9 June ECOFIN language, which I think provides a good
guide to the centre of gravity in the EU on that issue.
Q199 Mr. Heathcoat-Amory: You
can assure us that paragraph 8 will therefore come out of the
final conclusion—I think that you have given us that assurance.
Also, reference to micro-prudential supervision must therefore
come out of paragraph 7; but again, Lord Myners and the Treasury
do not want the establishment of rules or supervision at the micro
level to be done by the EU. Can I get you to assure us explicitly
that the draft conclusions will not be followed through in practice?
David Miliband: The most important
word in "draft conclusions" is "draft". I
would take the word "conclusions" with a large pinch
of salt. What I can assure you is that first, as the meeting of
Finance Ministers on 9 June made clear, arrangements for fiscal
support to individual financial institutions must remain aligned
with supervisory arrangements—hence the FSA.
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