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I am not going to talk about the budget in financial terms, as my hon. Friend for Harwich-[Hon. Members: "Clacton."] I love these boundary reviews; they are so much fun. My hon. Friend the Member for Clacton (Mr Carswell) has outlined the costs. I want to press home the process behind all this. Having sat on the back benches of the European Parliament, watching all this go through, I have seen the process get to the stage that we are at now, when the European Parliament's Budgets Committee adopted its wishlist for how much more
money it could possibly spend, and I know what comes next. There will be a little knock-back from the Council at the meetings that the Economic Secretary is about to attend and then there will be the stage at which these matters will be decided by qualified majority voting, because that is how all this works.
Mr David Nuttall (Bury North) (Con): Qualified majority voting is a term that might not be understood widely outside the House. Could we more simply describe it as other countries telling this country what to do?
Chris Heaton-Harris: I suppose so; I have heard it put in slightly more complicated terms. At the end of the qualified majority voting process, member states coalesce into different groups and it is quite remarkable that we have so many member states on our side at this time. That is something else that the Labour Government utterly failed to achieve on any occasion when it came to the budget. I think we are heading in the right direction.
I want the House to give our Economic Secretary the strong message that a number of us are simply reflecting the views of the people who elected us to this place. They see a lot of money being wasted and a lot of excess in the European Union and they know that we want to do something about it, but we need to negotiate from a very strong position. I know that the Economic Secretary is an unbelievably good negotiator. She speaks many languages when she goes abroad to talk to our European friends and those with whom we have to negotiate. I would like her to know that when she goes into those negotiations she can say, "This Government have taken a perfectly reasonable position. We are reasonable, but look at the Members of the House of Commons who are trying to represent their constituents-they are absolutely livid about the position the Government are taking just to get a half-decent cut, or maybe a standstill, in the European budget." We are trying to give extra force to her argument-nothing more, nothing less.
I commend what we are doing in the European Parliament. My colleague James Elles, a Conservative Member of the European Parliament, has tabled many fantastic amendments, some of which might go through, because he is an able negotiator who knows the institutions very well, and some of which will not. However, we will still end up in the same position whereby, at the end of the process, the European Commission's budget is bigger this year than it was last. That is unacceptable to the British public.
President Barroso recently gave a state of the Union address. I talk about that because I want to put into context where the argument sits now. We might be talking about the 2011 budget for the European Parliament, and I am trying to look forward to how we negotiate in the negotiations that are just opening up for the next financial framework. President Barroso put his cards on the table in his state of the Union address: not only does he want more money, but he wants to raise it in a completely different way. A former Minister for Europe talked about own resources; essentially, President Barroso would like to have a European tax. There is a debate for us to have on that.
Some people want a European tax because more member states are having debates such as the one in the Chamber today whereby their parliamentarians say, "You are spending a lot of money from direct taxation, not from the way you used to raise it." My hon. Friend the Member for Hertsmere (Mr Clappison) referred to that and it is unacceptable in the current economic climate.
Steve Baker (Wycombe) (Con): My hon. Friend adds a great deal to the Chamber with his wealth of experience. For those of us who are new to the EU institutions, will he explain how members of the British public may cast a vote to dismiss President Barroso?
Chris Heaton-Harris: That is a good question. I am not convinced that it is possible. There is only one way to get rid of any European Commissioner, and that is to get rid of the whole lot. That involves a process that an individual constituent- [Interruption.] No, I did not. I was way too young to be there.
Mr Dodds: May I suggest one way to address the particular issue of getting rid of some of those people? The British people should be allowed a referendum on the question of our relationship with Europe. Instead of having a referendum next May on the alternative vote system, which is not what people want to talk about, should we not have a referendum on this issue, which everybody is interested in?
Chris Heaton-Harris: The answer is yes.
I want to wind up by taking us back to the process that we are involved in. We are discussing the EU budget for 2011. Coming down the track is the EU budget for the next five or six years. If we do not make a stand now, we will be viewed as a pushover when we come to those negotiations next time round. We have done fantastic work. There has been no failure whatever by our Front-Bench team in already getting a bunch of countries to agree with what we are saying on the EU budget. I want the Economic Secretary to know that behind her she has so many friends wishing her to do well. We are just representing the British people in what they want as well.
Tracey Crouch (Chatham and Aylesford) (Con): I want to begin my short contribution by stating firmly that I am not anti-European. Much to the horror of many of my colleagues, I am also not a member of the "Better Off Out" campaign. I hasten to add, before my hon. Friends have a heart attack, that I am also not an overt pro-European. I simply recognise that our membership of the EU needs to work in our national interest and provide value for the British taxpayer.
In my constituency and across the country, our membership of the EU vexes people. Typically, they are resentful of its bureaucracy, centralised structure and perceived unaccountability. They cannot understand why so much of our country's decision-making process has been shifted to Brussels, when it should be here. With that in mind, I welcome the Foreign Secretary's recent announcement that a sovereignty Bill would be introduced, allowing authority to remain in our Parliament.
On the topic of today's debate, the draft EU budget will rightly be subject to close scrutiny. At a time when our country and Europe as a whole are enduring one of the harshest economic climates for a generation, the European Commission has proposed a 5.8% increase in the draft EU budget, demanding an increase in net contributions of staggering amounts from its member states. The UK alone can expect to pay nearly £2 billion more in the coming year. How many schools, hospitals, doctors, teachers and nurses could £2 billion pay for? In the light of the scaling back of departmental budgets in this country most, if not all, will find it difficult to reconcile the two.
In order to put the draft budget and its proposed increase in context, we must be clear about what preceded it and our current spending commitments. It is widely accepted and entirely accurate that the previous Government mismanaged the negotiations of the previous EU budget in 2005, leaving us as a country contributing a significant amount of money with a poor rate of return. Our contributions exceed those of France by some 20%, despite our economy being only a fraction larger than that of France. Our rebate, so generously relinquished by the previous Government, is left greatly reduced. We still have a common agricultural policy commanding a significant portion of the EU budget, yet British farmers receive a disproportionately small amount of the overall funding.
To ask the British taxpayer to fund a further increase to an already over-inflated and questionable contribution would seem a clear affront. In addition, it poses an interesting and important question. At a time when we are asking British taxpayers to tighten their belts in the national interest and driving down costs where necessary, is it fair to ask for belts to be loosened again for an excessive EU budget? In my constituency, Chatham and Aylesford, with two of the most deprived wards in the UK, it will be painfully ironic to many that as necessary cuts and trimming of our public services are carried out in the coming months, we are locked into spending commitments elsewhere that are not always in the nation's interest.
I share the Government's drive to get value for taxpayer money in public services and across Whitehall after years of waste and inefficiency, which is why we must ask ourselves whether the EU is prepared to do the same. I admire the Government's commitment to keeping their own administrative costs to a bare minimum, but in the original draft EU budget published in April I was horrified to see a proposed increase of nearly 4.5% in EU administrative costs alone. I hope this will be looked at throughout the review. It clearly highlights the mindset of those in Europe and raises serious questions about whether they share our Government's commitment to achieving value for taxpayers' money.
I welcome the Government's stance in seeking to freeze cash payments to the EU and agree that this would be the most desirable outcome. The UK's membership of the EU should be like any club transaction-you get what you pay for. That clearly was not the approach adopted by the previous Government, and once again the taxpayer has been left to foot the bill.
However, in the unprecedented economic climate that we have endured and are faced with, the EU is in the unique position to promote and contribute to the economic
recovery. The EU's mandate ought to be centred on filling a transnational role, tackling issues affecting Europe as a whole such as climate change and energy security, and naturally its budget should reflect that. It is regrettable that the new Parliament is restricted to voting on the basis of the previous Government's ill-advised negotiations. Not only did the previous Government bankrupt this country, but through the EU budget their legacy lives on.
Our Government is not alone in opposing the rise in the EU budget. Denmark, Austria, the Czech Republic, Finland, Sweden and the Netherlands all share our concerns. I therefore urge the Government to seek to form a consensus with other member states who share our concern, throughout the review of the budget. With UK Departments and services under severe financial pressure, and constituents throughout the country facing unprecedented strains on the pound in their pocket, I cannot see how we can justify increasing our contribution to the EU when it, in return, refuses to make similar spending reductions.
Priti Patel (Witham) (Con): It is a delight to speak in this debate as a new Member, particularly as the country was denied a vote on the Lisbon treaty and this is the first post-Lisbon budget.
When the Lisbon treaty was passed, we heard claim after claim that it would make the EU decision-making process more efficient and democratic. How can it have led to more efficiency, when the EU budget is due to increase by 5.8% in payment appropriations? Even the Opposition, with their astonishing record on spending and waste, would struggle to justify an annual increase in spending on that scale. I very much doubt that, in the current economic climate, any Department calling for such an increase in its budget would be given any consideration.
The Government's position is to keep cash levels at the same rate as last year, but, at a time when most domestic Departments are looking to make efficiencies and cuts ranging from 25% to 40%, why is the EU not being pushed further? With a total budget exceeding €130 billion, it is not unreasonable for the Government and the Economic Secretary to the Treasury, in her negotiations, to pursue the Commission and other member states to make deeper cuts in order to bring down the cost of the EU and to protect the British taxpayer.
My constituents in Witham and the majority of the British public now understand that the Government are dealing with spending, and that spending must come down. As decisions affecting my constituents are taken, however, they will be furious to see that, although they cannot have their new school buildings or road improvements for now, more and more of their hard-earned money is being handed over to Europe.
Having gone through the draft budget, which is a significant document, I note that there are some significant and questionable increases in spending, which the Economic Secretary should seek to reverse in her negotiations. There is an extraordinary document entitled, "Administrative expenditure of the institutions". Linked to the budget, it is an alarming read, and figures for each institution, line by line, give a shocking insight into bureaucratic waste in the EU.
Those figures include an 85% increase in "Entertainment and representation expenses"; a 440% increase in
"Miscellaneous expenditure on the organisation of Euromed Parliamentary Assembly meetings";
a 43% increase to €19.6 million on
"Expenditure on publication, information and participation in public events";
"Contributions to European political parties";
"Contributions to European political foundations";
and, on top of that, as we have already heard, the
"Provisional appropriation for the 18 additional Members of the European Parliament",
which under the Lisbon Treaty will cost €9.4 million.
I have previously questioned the Europe Minister, who is not here today, on that matter, but, while this Parliament reduces its numbers and cuts its costs, subsidies and expenses, surely the Economic Secretary should make the same point about Europe when she comes to negotiate with her European counterparts.
Only last month, another example of EU waste was brought to my attention. Promoted by the East of England Development Agency and the East of England European Partnership, the document entitled, "Europe for Citizens", opens with an extraordinary and, one could argue, helpful statement, proclaiming:
"Europe for Citizens is a funding programme that basically provides a large number of small grants."
I find that statement astonishing. In spite of the economic difficulties that face this country and, in fact, other European states, a pot of money amounting to €215 million is available for "High visibility events", "Town twinning",
"Structural support for think tanks",
"Support for projects initiated by civil society organisations."
Trimming those budgets and other activities would save the British taxpayer quite a lot of money and even bring some long overdue financial management to the EU.
Next month, as we have heard, we will have the spectacle of the European Court of Auditors finding, no doubt, even more irregularities in the EU budget for yet another year running. In any well-respected democracy, no organisation spending money on that scale would be able to get away with the auditors not signing off its books, or with the level of previous errors, which most Government Members attribute to the previous Government's maladministration. I urge the Economic Secretary to ask for stringent guarantees that money spent by the EU will be spent not only efficiently but robustly and effectively, and that the auditors are doing their job properly, because there are so many instances of waste and unaccountability. British taxpayers are not sufficiently up in arms about that issue.
Instead of acknowledging the deficiencies in its budgets and its incompetent financial management, the EU lives in denial, pursuing a policy of blatant spin and propaganda, and attacking any organisation that dares to question how taxpayers' money is being spent. On its website, there is a whole section devoted to so-called
"EU budget myths", and a "myth-buster guide" has been published. The EU goes as far as to state that we should
"not confuse errors with fraud"
"too many errors, usually made by the end users of EU funding."
This budget and the forthcoming negotiations clearly provide an opportunity to challenge the EU in its way of working.
Nick de Bois (Enfield North) (Con): Does my hon. Friend agree that when the Economic Secretary engages in these negotiations, which I have no doubt that she is more than qualified to lead given what she said earlier, it would be to her advantage if we supported amendment (b), because going in and asking for a reduction in the budget instead of just the status quo would help our case?
Priti Patel: I totally agree with that.
The situation is without a doubt unsustainable. Particularly given the EU's previous track record as regards misappropriation of funds and lack of transparency, current funding levels cannot continue. EU officials need to understand that the British public cannot be treated like fools. We can clearly see through the spin, the propaganda, and the abuses of taxpayers' money for endless self-serving vanity projects that are not in our democratic, economic or national interest. Just as sunshine has proved to be the best disinfectant on issues such as MPs' expenses, it is about time that some sunlight was shone on to the EU budget.
Priti Patel: They are welcome to IPSA, as well.
It is an appropriate coincidence that we are discussing the EU budget on the very same day that Baroness Thatcher celebrates her 85th birthday. What better way to celebrate the Iron Lady's birthday than for the Economic Secretary to go to Europe tomorrow, stand up and really fight our corner, and say those immortal words, "No, no, no", giving an ultimatum to her European counterparts and the Commission bureaucrats as they press for larger sums of money to be spent and attack our rebate?
I wish the Economic Secretary well in those fundamental discussions and negotiations. Our country has paid a high price on previous occasions, and our sovereignty has been undermined. We have Europe meddling in our affairs, taking billions of pounds from the hard-pressed British taxpayer. I urge her to put Britain's interests, and the interests of the British taxpayer, first.
Mr Ian Davidson (Glasgow South West) (Lab/Co-op): I rise to support a reduction in the EU budget. As some Members may be aware, I have advocated that any such cut would more than meet the costs of providing a second aircraft carrier for the Royal Navy.
Who would have thought that less than six months after the election we would be having a debate where a Conservative-led Government would be denounced by many of their Back Benchers for being soft on Europe? I was surprised to hear my right hon. Friend the Member
for Rotherham (Mr MacShane) say-I think that he is correct-that, as far as he can tell, there has been almost complete continuity of policy from the previous Government to this Government in terms of their relationship with the EU. I have noticed that many commentators are similarly remarking that there seems to have been very little change in policy towards the EU. I hope that that is simply a question of settling in, and that when the Government find their feet they will be much more prepared to stand up for British interests.
There is another possibility. Yesterday, we heard that the alternative vote referendum was being brought forward simply as a concession to the Liberal Democrats-the Liberal tail wagging the Conservative dog. I hope that the Government's softness on the European Union is not another case of the Liberals having received undue concessions from the Conservatives. I point out to Conservative Members that it is not possible to buy Liberal Democrats-they can only be rented for short periods, and one can never rely on their remaining rented. If the Conservatives are counting on the Liberal Democrats to support them all the way, they are likely to be sadly mistaken.
Unless I am very much mistaken, it is noticeable that there are no Liberal Democrats here at the moment, unless Members who are sitting on the second Bench back have joined them.
Mr Dennis Skinner (Bolsover) (Lab): They're all in Europe.
Mr Davidson: Are they all in it together? Yet again, I suspect that the Liberals are leaving the Conservatives to do the dirty work for them and put the budget through. I imagine that if the Conservatives carry on their course of action and we have an AV voting system next time around, the UK Independence party will do far better in the first ballot than it might have done in the past. I find it a great cause for regret that the Conservatives seem to have gone soft on Europe in such a short period.
Mr Bone: I normally agree entirely with the hon. Gentleman, but will he cast his mind back to the previous Parliament? When did a Minister talk the way our Minister has spoken tonight, and when were the Government Benches as full for a European debate as they are tonight?
Mr Davidson: That is a very fair point. Not many times were the Benches behind a Minister full of Members denouncing the Government for being too soft on Europe. There were a number of us doing so, but not nearly as many as there are tonight. I am grateful to the hon. Gentleman for making that point.
Some of my colleagues who spoke earlier touched on the iniquities of the EU budget. As someone who was a member of the Public Accounts Committee for a number of years, I am in complete sympathy with everything that has been said about how the auditors have qualified the accounts. The whole matter is a complete and utter disgrace. The audited accounts only tell part of the story, of course, because they do not cover the fact that EU income and the income of individual countries is enormously depressed by the extent of fraud, underpayment, under-collection of VAT and so on,
which is reflected in the EU budget. [Interruption.] Can I have a lack of heckling from my hon. Friends in front of me, who support most of my arguments?
The EU budget is about not only the net and gross amounts of money flowing back and forward, but how that money is spent. Were it given by the EU to the British Government to spend, we would not be spending it in the way that we are. We have created a dependency culture among farmers. I know a number of farmers-admittedly not many of them are in my constituency-who concede that what they mostly farm now are subsidies. The whole pattern of their growing and activity is determined by the subsidies that are available from the EU, irrespective of the agricultural, financial or economic rationale. That is not rational or right, and such decisions ought to be repatriated to this country as quickly as possibly.
The hon. Member for Hertsmere (Mr Clappison) asked what the actions of Labour MEPs were likely to be, but I think that there is little doubt. We should remember that virtually all Labour MEPs were selected under the new Labour system of allowing only those in favour of ever-closer union to progress. I can remember when a number of Scotland Labour MEPs were Eurosceptic, but when the new system of proportional representation was introduced, Labour put them all out. Ever since, only those in favour of ever-closer union have come forward. I would be astonished if any Labour MEP does anything against those interests and the interests of the greater growth and development of the EU.
Mr Desmond Swayne (New Forest West) (Con): I acknowledge the hon. Gentleman's honourable record on this matter, but will he acknowledge that the description that he just gave admirably suits the Quisling-in-chief now occupying the position of Opposition Front-Bench spokesman, who always urged the previous Labour Government on from the Back Benches?
Madam Deputy Speaker: Order. I think the hon. Gentleman's language-"Quisling-in-chief"-was a little strong, and I am sure that he would like to rephrase his view of that individual, even on an intervention.
Mr Swayne: I unreservedly withdraw the remark.
Mr Davidson: Now that the hon. Gentleman has withdrawn his remark, I shall not respond to it.
The point about the External Action Service has already been made, but I was astonished at the time of its creation that so many otherwise sensible people believed that it would result in no net growth in expenditure. Of course it was going to, and it was always intended that it would do so. It is interesting that those who wish to be deceived are deceived, including by promises from the European Union to moderate or reduce expenditure. That is simply a fig leaf. Those who accept such promises choose to do so, and then pretend to be astonished when it turns out that the situation is different. The idea that the Lisbon treaty is not the constitution is simply laughable, and only those who wish to be deceived by that twisting of words are so deceived.
Does the hon. Gentleman agree that the root of the problem is not only the EU budget, but EU functions, which were greatly increased by the Lisbon treaty? The ESC agreed this afternoon that we will
examine fully the question of parliamentary sovereignty as against European functions. Does he also agree that a precondition of reducing EU functions is asserting UK sovereignty, and requiring the judiciary to give effect to Westminster legislation and to override European legislation as and when necessary?
Mr Davidson: I accept that. It is enormously helpful that the ESC, of which the hon. Gentleman is Chair, will pursue that course of action. I only hope that the Committee does not take too long.
Mr Davidson: That is very welcome indeed. Pursuing that sooner rather than later is welcome.
The point about the External Action Service is not only that it costs more money, but that it is invidious. The desire of the EU is that it should be a state and that the EAS should be an embassy. I note that the EU has just taken over enormous premises in central London. Those will be nothing other than a centre for pro-EU propaganda and an attempt to intervene directly in British politics and British political affairs in a way that we would not tolerate from any country-I almost said "any other country." We would not allow the Austrians, the Australians, the Canadians or anybody else to have a propaganda outfit in this country that spent enormous amounts to intervene directly in British politics, yet we are prepared to allow the EU to do so. In my view, its wings ought to be clipped.
The hon. Member for Daventry (Chris Heaton-Harris), who I believe has left the Chamber, commented on the extent to which we reflect our constituents' anxiety about EU spending. I think that he was wrong, because we do not accurately reflect those. The balance of this debate is clearly in favour of constraints on EU spending, and that reflects the balance of opinion among the public, but I fear that the vote will not reflect that because vast numbers of Conservative MPs will be driven like sheep into the Lobby to support the Government and oppose any proposal to restrict the expenditure of the EU.
I hope that we will be able to return to the discussion of a referendum. It is correct for Conservative Members to point to the Labour Government's failure to honour their commitment to a referendum on the constitution, but I point to the Conservatives' failure to do the same. Given that next year Europe intends to re-examine its budget and the common agricultural policy, we should start by saying that that major revision should be put to the British people in a referendum, to determine whether they are prepared to accept the new financial arrangement, which will represent-I hope-a considerable break with what has happened in the past. Of course, it may not break with the past, but it would strengthen the Government's hand enormously if we made it clear that they were prepared to take any new financial settlement with Europe, achieved after a long period of debate, to the country for resolution.
In the meantime, I support the proposals that urge a reduction in the EU's expenditure, and I hope that we will not discover that a majority of Conservative Members oppose those proposals.
Andrew Percy (Brigg and Goole) (Con): It is a delight to follow the hon. Member for Glasgow South West (Mr Davidson) and I agree with much of what he had to say. I have no intention of criticising the Economic Secretary tonight. Indeed, I support the new Government's position on the European budget and it is much more robust than was the previous Government's. In fact, I pay tribute to the Economic Secretary's contribution to the debate, which contrasted starkly with what we heard from Ministers in the previous Government. There is no suggestion that any one part of the coalition is directing another. It is especially unfair to suggest that the Liberal Democrats are not here for the long run. I fully understand that a Lib Dem is not just for Christmas-if you're lucky, there will be some left over.
I also thank the shadow Minister for her remarks. She did a great deal of good for the argument made by those of us who believe that the European Union and its budgetary processes have gone too far. In fact, by confirming that the Opposition have no policy on the issue of the European Union, she has made our job much easier. The Opposition's position is very strange. They complain about spending cuts across the country, but they fail to say what they think about the European budget. Do they think that their constituents should be deprived of spending commitments in this country for the sake of an increase in the EU budget? That is a bizarre and strange position, but it is one that I do not have to defend to my constituents.
I urge the Economic Secretary to ignore the advice of the right hon. Member for Rotherham (Mr MacShane), who suggested that we should engage in some sort of trail of dinner parties-presumably paid for by EU taxpayers' money-as, he said, the previous Government did. Where did that get us? It lost us our rebate and saw the previous Government committing to increasing the EU budget even further. We need no lectures from the Opposition on how to address this process.
I am a committed Eurosceptic. My antipathy to our membership of the European Union is widely known, and I made it very clear to my constituents at the election that I would seek a different relationship between this country and the European Union. However, that is not the debate we are having tonight. We are talking about whether we should approve sending more of my constituents' hard-earned cash to Brussels to be spent elsewhere. I am not happy to support that position, and I will certainly not support it.
What are we being asked to pay for? We are being asked to pay for a 2.5% increase in the administration costs of the European Union, at the very time when we are telling councils and Government agencies across the country that they have to reduce their administration costs. How can I square that circle to my constituents? We are being asked to approve a 5% increase in contributions to the pension budget. At the same time, I am telling my constituents that their public sector pensions will be linked to the consumer prices index, rather than the retail prices index. We are also proposing to spend an extra 4.15% on the EU schools budget, at the very moment when we will be asking schools in this country-including, possibly, the one at which I taught just a few months ago-to spend less.
We are also asking Government Members and taxpayers to approve more money for the European External
Action Service. I am pleased to say that when we had the debate on the European External Action Service, I was one of the Members in the No Lobby. As was mentioned earlier this evening, we were assured that the programme would be cost-neutral, but we now know that we will spend an awful lot more taxpayers' money on a body to represent my constituents overseas for which they did not vote.
I do not need to talk about what the extra money going on this budget increase could be spent on. We have heard about the 12,000 extra nurses or the 14,000 police constables on which it could be spent. I am not certainly going to go back to my constituents and tell them that I have voted to spend money that could have been spent on front-line NHS nurses, teacher support in schools or our brave servicemen.
We have heard a great deal today about the previous Government and what they gave up. It is an absolute disgrace that they gave up our rebate, for absolutely no reform. For the past 30-odd years, we have repeatedly been told, "Well, we'll accept this little budget increase in Europe in return for some reform." We have always been told that some reform is coming down the line, but it never comes, because the European Union is institutionally incapable of reform. There can be no doubt about that at all.
Mrs Main: There is no incentive.
Andrew Percy: Indeed, as my hon. Friend says, there is no incentive for any sort of reform.
Those who support the budget increase have made great play of the fact that the amount spent on the common agricultural policy has reduced. It has indeed reduced: it is down to about 42%. However, even without the fraud and mismanagement that we all know about, the OECD has warned that the real cost of the CAP is £125 billion a year, so we could go a great deal further. The hon. Member for Glasgow South West mentioned the fact that we are now in the strange situation whereby farmers are effectively farming subsidies. However, I have talked to many of the farmers in my constituency, and I have to say, "If only they were." Instead, we are asking them to manage environmental schemes, and at the very time when we are becoming more and more reliant on imported food.
I mentioned in an intervention on the shadow Minister that we cannot get away from the fact that the EU budget has not been signed off for some 15 years, and there is no doubt that it will not be signed off again, as my hon. Friend the Member for Daventry (Chris Heaton-Harris) said. Like other right hon. and hon. Members who are present, I am expected to go to my constituents and tell them that we would like to take more of their money to put into an institution that cannot guarantee that the money will be spent where it says it will be spent. I am not prepared to do that on behalf of the good people of Brigg and Goole who sent me here and whom it is my privilege to serve.
There is a broader issue, about the relationship between this country and the European Union, which touches on people's engagement with and perception of the European Union, which was mentioned in earlier speeches. I note that Open Europe, which is a very sound pressure group, conducted a poll that found that 54% of people agreed with the statement that the Government should
drop the Lisbon treaty and not try to ratify it. That 54%, as was proved in other polls, was ignored; the previous Government forced the Lisbon treaty through and broke an election promise. Some 65% of people believe that the European Union is out of touch with normal people, but sadly it is normal people's hard-earned cash that is used to fund the EU, while 88% could not name their MEP. I wish that I did not know the names of some of my MEPs. Turnout for European parliamentary elections was at its highest in 2004, an abysmal 38.5% when I was up for election as a councillor, and it is a pretty poor pass when councillors such as me are used to drag up the European election turnout.
There is a general view in this country that the political elite is out of touch with the British public on the issue of Europe. My concern is that, if we approve yet more cash for the wasteful institution that is the EU, the gap between what the public expect and the position of the political elite will widen yet further. That would not be healthy.
Andrea Leadsom (South Northamptonshire) (Con): Many people at the last general election who cared a great deal about Europe and were furious about it felt that voting Conservative was the way to ensure that something would be done about the massive amount of waste and bureaucracy in Europe. We owe it to them to achieve that.
Andrew Percy: I could not agree more with my hon. Friend. As I said earlier, what we heard from the Economic Secretary to the Treasury today was incredibly refreshing, and I am heartened that she is going to fly off to Brussels tomorrow and bang the table on behalf of British taxpayers. The British people expect someone to stand up for them in Europe, and I have no doubt that the Economic Secretary will do so.
Robert Halfon: My hon. Friend is making an excellent speech. Does he agree that this should be a question not of freezing the amount of money that we give to the European Union, but of reducing it substantially? If we are cutting departmental budgets here rather than freezing them, we should also be reducing the EU budget. That is what taxpayers want.
Andrew Percy: My hon. Friend hits the nail on the head. It has come to a strange pass when I have to explain to my constituents why a number of their play parks, costing some £5,000 to £10,000 each, can no longer be afforded because we have run out of money-as we know we have, because Labour has admitted it-only to have to tell them that we need to find £435 million more to send to projects overseas. I fully accept that some of that money will come back here, but a large chunk of it will not. We would not expect our constituents to invest in a bank that offered that kind of a deal.
I support the strong stance that the Economic Secretary set out earlier, and I hope that there will be significant movement on this issue in the coming months and years. However, we are being asked tonight whether we are prepared to ask our constituents, at a time when we are making massive cuts and asking them to make savings, to foot the bill for much more money for Europe. That is not something that I am prepared to do to the voters of Brigg and Goole.
Madam Deputy Speaker (Dawn Primarolo): Order. I want to inform the House that I intend to give those on the Front Benches time to make a brief response to the debate, and I shall do that at 8.22 pm. There are still a number of Members who wish to speak, so I ask them to do the maths and to help their colleagues out if they can, please.
Gordon Henderson (Sittingbourne and Sheppey) (Con): Over the past few months, we have spent a lot of our time debating one aspect or another of the financial crisis in which the country finds itself. Britain has a huge deficit, and the British public have collectively built up a mountain of personal debt. All in all, we are in a real mess. The Government have set out a series of measures to reduce the national debt, and I know that many individuals-including people in my constituency-are trying hard to cut down their indebtedness. These are tough times for us all, and we are not alone. Many other countries around the world, including many in Europe, are facing huge financial challenges and struggling to balance their books without pushing their national economies into another recession.
In this era of uncertainty and austerity, what does that organisation of probity and good governance, the European Commission, do? It proposes to increase the EU budget next year by 5.8%, which in real money represents an increase of £6,102 million. What planet do European Commissioners live on? They live on the planet of self-indulgence. They live in a cushioned climate of privilege in which the Brussels gravy train does not stop long enough for them to see what is happening in the real world.
To be fair to our own British Government, at least they recognise the stupidity of the European Commission. As the Economic Secretary wrote in a briefing note and confirmed this evening, the Government are very concerned about the proposed increase in appropriations of 5.8%. They might be very concerned, but I would be absolutely livid. I give at least one out of three cheers to the Treasury for that statement but, sadly, I cannot bring myself to give it any more cheers. My hon. Friend let herself down in addressing the EU problem by proposing that the EU budget remains at cash levels equivalent to the 2010 budget. That is also why I cannot support amendment (a). I bet all those Ministers tasked with making a 20% cut in their departmental budgets are a bit narked. I am sure that in the present economic climate, they would be delighted to be given a zero growth budget.
Like many other right hon. and hon. Members, I have been inundated with letters and e-mails complaining about the proposed cuts in benefits, increases in tuition fees and changes to public service pensions. There is a great deal of disquiet out there and representing a constituency that has some of the most deprived areas in the south-east within its boundaries, I share some of that disquiet, but I am happy to go into bat on behalf of the coalition Government and to argue the case for those cuts. I believe that in their heart of hearts, most people in my constituency understand that we have no choice but to push through those cuts if we are to reduce the mountain of debt we inherited from the previous Government.
In common with my hon. Friend the Member for St Albans (Mrs Main), however, I would not be able to look my friends and neighbours in the eye if we drove through a programme of painful cuts in our public services, while at the same time bunging the EU billions of pounds to waste on grandiose schemes such as the European External Action Service and the European Institute of Gender Equality in Vilnius, Lithuania, for which, incidentally, the UK is being asked to cough up £800,000.
Next year, the European Commission proposes to spend £7 billion on administration. By my calculation, the UK's contribution to those administration costs will be about £1 billion. If Government Departments and public bodies in this country are being asked to cut their administration costs, it is surely right to expect the European Commission to do the same.
Charlie Elphicke (Dover) (Con): Does my hon. Friend note with concern that where the UK has a 15% increase in public spending over five years, the European Union wants to increase its spending by 60%?
Gordon Henderson: I am aware of those figures and I think that they are scandalous.
My hon. Friend the Economic Secretary has said that the British Government will press the EU to deliver greater value for money, and I am sure that she and the Government will do so, but does anyone here really believe that our friends across the English channel in the European Commission will actually listen to them? When the draft budget is eventually presented to the European Parliament for debate later this year, do Treasury Ministers really think that anyone other than a small group of British MEPs will take a blind bit of notice of their view? I think not.
I would personally like to see the Government unilaterally reduce the UK's contribution to the EU budget for 2011 by the average percentage cut imposed on Whitehall Departments. If the European Commission and the European Parliament do not like it and kick up a fuss, we should immediately hold a referendum on Britain's continued membership and let the British people decide our future once and for all. Perhaps we could hold it on the same day as the referendum on the alternative vote.
I support amendment (b), and I urge Members in all parts of the House to do the same.
Mr Dominic Raab (Esher and Walton) (Con): I think it worth repeating plainly from the outset-not least in response to some of the observations made by the hon. Member for Glasgow South West (Mr Davidson)-that the last Government failed hopelessly to stand up for the British national interest in Brussels. They failed to secure the overhaul of the common agricultural policy that Tony Blair promised, and they failed to defend Britain's rebate, as a result of which we now pay an extra £2 billion to Brussels each year. As we have already heard, they also broke their promise to the people to give them a say on their own future through a referendum on the Lisbon treaty. The present Government have done more to fight Britain's corner in Europe in the last six months than Labour managed in 13 years, proposing a referendum lock, retaining Parliament's right to review the UK budget before the Commission, and defending the rebate.
With that in mind, I welcome the Government's pledge to work to control the growth of the EU budget and to deliver better value for money for the British taxpayer. That is imperative as we act to reduce the largest budget deficit in the G20, inherited from the last Government. I also welcome the fact that the Commission's proposed increase for 2011 has been halved, from 5.8% to 2.9%. That is a start.
The case for a more robust and rigorous approach to these negotiations is now overwhelming. It cannot be right for the European Commission to bid for a rise of almost 6% in its budget when so many member states, including Britain, are having to rein in excessive public spending. Let us take just one example. Why is the EU budget on justice and security going up when the UK faces cuts in spending on police and prisons at home? That is even less defensible when we consider the Commission's detailed plans for the money.
First, there is the enormous waste involved. We have already heard about the EU's administrative budget, which is set to rise year on year by between 4.4% and 5.5%. Can the Minister reassure us that the Government will continue to resist strenuously an increase in the amount of British taxpayers' money that is forked out on this bloated bureaucracy? Secondly, there are the special interests-what the Americans call pork-barrel spending. Is it really necessary to spend €104 million on
"increasing the circulation of European audiovisual works inside and outside the European Union"?
Is it really necessary to spend €24 million on bee-keeping, and to spend half a million euros on "aid for silkworms"? Speaking of which, what possible justification is there for Lord Mandelson to continue to pocket £8,600 per month, via the Commission, for a golden goodbye as we freeze public sector pay at home?
As the Business Secretary told MEPs last month,
"no one can understand why the European budget is not being subjected to the same discipline"
as national budgets. Nothing is more likely to erode further the confidence of the British public in a Brussels clique that is woefully out of touch.
As we make cuts at home, the UK taxpayer will contribute £7.7 billion to the EU budget this year, and by the end of the current Parliament that figure is expected to rise to £9.5 billion. As its own budget defies economic gravity, the Commission, unabashed, presses for greater control of national budgets. Will the Minister reassure the House that she will reverse those skewed priorities, and will fight both to rein in excessive EU spending and to safeguard national scrutiny of our own budgetary process?
Above all, this budget demonstrates, line by line, how important it is for Britain to retain its rebate. As of December 2009, the rebate has saved the British taxpayer £65 billion since 1984. Can the Minister give us a categorical guarantee that we will never repeat the supine sell-out of 2005?
Having listened carefully to the debate, I cannot help feeling that the most compelling arguments remain those advanced by the Government when they joined Denmark, Austria, the Czech Republic, Finland, the Netherlands and Sweden in voting against this wretched budget in August.
Charlie Elphicke (Dover) (Con): I will be as brief as possible. I just wanted to note the following numbers. The total managed expenditure in the United Kingdom Budget will be £697 billion in 2010-11 rising to £700 billion in 2011-12. That is an increase of just 0.5%, whereas the European Union is really gunning for it with a 5.8% increase and, as we have heard, administration costs will rise by 4.4%.
It is worth noting what the Commission has to say about the administration costs. It says it has made particular efforts to limit its administrative expenditure and that rise is partially due to the higher than expected salary increases in 2009. So we in the UK are implementing austerity and limiting the pay rises for our public sector workers while the EU just carries on serenely as though nothing has happened. An increase of €380 million is entirely unacceptable.
We have heard about the total number of doctors, nurses and others who will be affected in the current circumstances, but let us look at the constituency numbers: nine doctors per constituency, 19 nurses, 23 policemen and 34 troops. That is the scale of the situation we are facing. The EU budget is therefore a ferocious and astonishing waste of money. It is entirely unacceptable that over a five-year period we in the UK are having a 10% rise in spending, but there will be a 60% rise for the EU. What do we as a nation get for that? Do we get any value at all?
Finally, I want to congratulate the Economic Secretary on making the strongest and most impassioned case on Europe from the Dispatch Box that any of us has seen in the past 20 years, setting out that the Government will take the EU to task and bang the table and make the points that need to be made. I hope I speak for the whole House when I say that in negotiating on this matter she has our strongest and best wishes. All Members on the Government Benches certainly want her to get the best deal for Britain.
Mr John Redwood (Wokingham) (Con): Conservative Members clearly have a very simple message for the Minister: we wish her well and we wish her to be strong and fierce in argument and debate, because we think she should be more ambitious. It is not enough just to freeze this budget; this budget has to be brought down. If there is any budget of all the budgets we look at in this difficult time about which we can say, "We can get away with cutting that," it is this budget. I suspect many Opposition Members would agree with that, were they honest about it. We are talking about a budget of €143 billion or £120 billion, which is more than we spend on the national health service. A big chunk of that budget is down to us, and we get nothing like the value out of it that we get from the NHS.
I therefore hope the Minister will look to the following very important precedent. The last time we had a good battling female Minister who stood up for Britain she was armed only with a handbag, yet with that one piece of equipment she came back with the biggest rebate we ever got: the rebate the Labour party stupidly gave away, and the rebate we need back. That rebate would give us twice as much money as the amount the Government are hoping to save from the cut in child benefit. We
know the Minister has the right equipment. She assures me that she has an excellent handbag, so we wish her every success in putting that argument.
The argument to the Greeks, Italians and Portuguese must be that they are having to make far worse cuts than any that are suggested for the European budget. We can cut collectively in a much more sensible way than the damaging domestic cuts they are having to put to their electors. The French have already had riots on the streets over their domestic cuts. I am sure they will agree with our Minister that there are some easy pickings to be had by removing items from this European budget. I therefore also hope the Minister will point out that because this is a levy on all the member states and all the member states are borrowing too much money, every penny and cent of that €143 billion is going to be borrowed. The taxpayers will not just have to pay once, therefore; they will also have to pay all the interest on that and be ready to repay the debt.
Is this really the kind of thing we want to be borrowing money for? Of course it is not. So Godspeed to you Minister: put the case, and win over all those other Governments. They will surely agree with us that it is better to cut the European budget than to cut important domestic programmes.
Madam Deputy Speaker: I call Peter Bone and ask him to be brief.
Mr Peter Bone (Wellingborough) (Con): I shall be brief. It is difficult to follow my right hon. Friend the Member for Wokingham (Mr Redwood), but I just wanted to say what a change it is to be in the House discussing a European issue when all on the Government side are united. New Back Bencher after new Back Bencher has said to the Minister, "We support what you say; go a little bit further." We have heard the Minister accept an amendment tabled by my hon. Friend the Member for Stone (Mr Cash). I say to the hon. Member for Glasgow South West (Mr Davidson) that he has tabled a lot of amendments but I cannot remember his Government ever accepting any of them. The Minister was also kind enough to say that had amendment (b) been worded slightly differently, she would have accepted that too.
The coalition Government are united, but I want to give a little help to the Minister by suggesting that if amendment (b) is passed, or if many Members vote for it, that will help her in the negotiation tomorrow. Just peeking over, I can see that she has got a very large handbag, so I ask her to use it tomorrow.
Mr Wayne David (Caerphilly) (Lab):
We have had a very interesting debate. Before it, I had thought there was a chance that perhaps the Conservative party had changed, and that it had learned the errors of its ways and said farewell to Eurosceptism. But no, Eurosceptism is alive and well in today's Conservative party and, in fact, it would appear to have been given a new lease of
life. In reality, many of the contributions made by Conservative Members today were speeches against not only the European Union budget per se, but the European Union as an entity.
I urge Conservative Members to continue to be frank, but I must ask where the Liberal Democrats were. Until recently, that party used to pride itself on being the most pro-European in Britain. Well, in this debate the Liberal Democrats have certainly withdrawn to the fringes, as we have seen them do this week generally. Apparently, no compromise is too much for them, no U-turn too sharp and no sell-out too great. What is true in domestic politics is equally true on Europe.
What about the Conservatives? Let me make it clear that an efficient and effective EU budget is important for Britain. The majority of our exports go to the rest of Europe and that is why the EU budget must act as a stimulus for growth. We need to reinforce the conditions for future growth and, as is said in the commentary on the draft budget, we must invest
"in research, development, and innovation, infrastructure and human capital"
"are at the heart of economic modernisation".
That is not to say, however, that we should not be hard-headed about what areas of EU expenditure should be reduced. It is right that there should be a freeze on EU staff recruitment in Brussels and that various benefits for current and retired EU officials should be reduced. There is a necessity to maintain budgetary discipline, and we must always ensure that there is value for money at a European level. Equally, we should be prepared to say that further savings should be made. Let Britain champion, for example, the ending of the ludicrous circus of the European Parliament travelling back and forth between Brussels and Strasbourg-the Government say a lot about it but have done absolutely nothing. Let us examine whether it is really necessary for the EU to promote culture and let us continually make the case for reducing subsidies to well-off farming interests.
Of course Labour Members support the Government's aim of reducing the EU budget, but the reality is that the amended budget, agreed by the Council of Ministers in August, represents an increase of 2.9% compared with this year's budget. We know that the UK Government, along with smaller Governments from across the EU, voted against the amended budget. But, we know that the Government lost the debate and the vote in the full European Council-so much for the Government's claim to be winning the arguments in Brussels.
Even though the Government initially mellowed their strident Eurosceptism, which the Conservative party displayed in opposition, their lame and half-hearted attempts to fight for British interests are falling far short of what is needed. The Conservatives' decision to withdraw their MEPs from the mainstream European People's party, along with their vacuous proposals for constitutional tinkering, debilitates Britain's engagement in Europe.
What this country needs is a Government who fight hard for British interests, not through posturing but through purposeful co-operation around a positive agenda-an agenda that recognises that if Britain is to succeed in the modern world, it must be a Britain that is located firmly in the mainstream of international co-operation.
Justine Greening: With the leave of the House, in the short time available I want to respond to the debate. First, may I express my gratitude to the many Members of this House who have expressed their support for what our Government are trying to do in tackling the remorseless rise in the EU budget? Hon. Members have played an essential role in scrutinising the budget and I thank them for their participation.
In particular, I pay tribute to my hon. Friend the Member for Stone (Mr Cash), whose amendment we support, for his reasoned and impassioned comments on the challenging process to cut the Commission's 2011 budget proposals. Our stance is that we want a cut-a real-terms cut-and as my hon. Friend's amendment also points out, although we have challenged the budget at a Council level, we now need to put pressure on the European Parliament, too. His amendment does just that.
For the reasons that my hon. Friend set out, we cannot support amendment (b), tabled by my hon. Friend the Member for Clacton (Mr Carswell). We need to maximise the chance that we have as a Government of achieving our blocking minority, as my hon. Friend the Member for Stone so eloquently set out, and amendment (b) would not help me to achieve that objective for the Government. In fact, it would risk preventing me from doing so.
Zac Goldsmith (Richmond Park) (Con): Will my hon. Friend give way?
Justine Greening: I must make some progress, because we have very little time left.
In the wake of the worst financial crisis in living memory, and with the events that subsequently unfolded, we have said today in this House that we believe-rightly-that there is no justification for an increase in the EU's annual budget of nearly 6%. In fact, as we have heard, countries across Europe are taking steps to ensure fiscal consolidation, and there is a strong case for the EU to follow suit-I know that the House can tell that I am taking that case to Europe directly and making it to those countries. My right hon. Friend the Member for Wokingham (Mr Redwood) pointed out how they are taking difficult decisions, and I made that exact point in French to the French Finance Minister.
At a time when all our European neighbours are looking to rein in public expenditure, the EU should not be looking to carry on with business as usual. It cannot be a case of carrying on regardless. That is why we voted against the Council's first reading, which went in the right direction but did not go far enough-a view seemingly shared by everybody in this House apart from those on the Opposition Front Bench. They let us down by losing part of the rebate in 2005 and now in 2010 they are letting us down again by failing to support our efforts as a Government and as a coalition of parties on behalf of the British taxpayer to get value for money.
My hon. Friend the Member for Sittingbourne and Sheppey (Gordon Henderson) asked how many MEPs will vote against this provision. I can reassure him that we are already talking to our partners in Europe and in our group-the European Conservatives and Reformists. I have spoken to my hon. Friend the Member for
Scarborough and Whitby (Mr Goodwill), my good friend, and he assures me that he spoke yesterday to the Whip in charge of that group and all that group will be voting against a rise in the European Parliament when it comes before them. I urge those on the Opposition Front Bench to join us in that and to confirm that their Socialist group will do that. If they want to help the British taxpayer, they can start lobbying their own group in the European Parliament in the way that we have already successfully done.
Finally, we have spoken a lot tonight about concerns over the effectiveness of the EU spend and how well it is accounted for. I share those concerns. In fact, the last Government never used their vote when they took a look at the European audit accounts. We plan to be ready to use our vote if we see accounts that fail to meet the standards that we think they should. If we see accounts that contain points made by the European auditors that we believe the Parliament is not taking on board, we will be ready to use our vote in future to challenge the Commission in a way that the last Government never were.
I want to thank Members again for their valuable contributions. It has been incredibly useful for me to have this debate, particularly on the day before I travel to Brussels to defend our national interests and to get the best possible deal for the taxpayer.
Kerry McCarthy: Will the Minister give way?
Justine Greening: Not unless the hon. Lady is about to say that Labour MEPs and their Socialist group will support us.
Kerry McCarthy indicated dissent.
This year, member states have been taking unprecedented action to restore sustainability to their national finances, making tough choices today to deliver a better future tomorrow. That is the case that I shall be making to my colleagues across Europe in the days and weeks ahead. In these times of austerity, there is no justification for ineffective, wasteful expenditure and there is a real need to scrutinise every euro of spending to ensure that it delivers what is promised. The Opposition might not want to play a role in challenging the unacceptable Commission budget rise, but the Government and we on the Government Benches will. I commend the motion to the House.
Amendment proposed: (b), leave out from 'the financial year 2011' to end and add
'is concerned at the above-inflation increase being made to Britain's EU budget contribution; believes that, at a time when the Government is poised to make reductions in public spending elsewhere, it is wrong to increase that contribution; and calls on the Government to reduce Britain's EU budget contribution'. -(Mr. Carswell.)
Question put, That the amendment be made.
Proceedings interrupted (Order, 12 October).
The Deputy Speaker put the Questions necessary to dispose of the business to be concluded at that time.
Amendment mad e: (a), at end add
'and calls on the Government to reject European Parliament proposals to increase the budget' .-[Mr Cash .]
Main Question, as amended, put and agreed to .
That this House takes note of European Union Document No. SEC(2010) 473, Statement of Estimates of the European Commission for the financial year 2011; and supports the Government's efforts to maintain the 2011 EU budget at the cash levels equivalent to the 2010 budget, while ensuring better value for money in EU expenditure; and calls on the Government to reject European Parliament proposals to increase the budget.
Madam Deputy Speaker (Dawn Primarolo): Order. May I ask Members to leave the Chamber, if that is what they wish to do, quietly and quickly so that the rest of the business of the House can continue?
That the Town and Country Planning (General Permitted Development) (Amendment) (No. 2) (England) Order 2010 (S.I., 2010, No. 2134) and the Town and Country Planning (Compensation) (No. 3) (England) Regulations 2010 (S.I., 2010, No. 2135), be referred to a Delegated Legislation Committee. -(Stephen Crabb.)
Phil Wilson (Sedgefield) (Lab): The petition states:
The Petition of residents of the Sedgefield constituency, and others,
Declares that the petitioners believe that the Government should implement the procurement of rolling stock through the Intercity Express programme, which would lead to Hitachi building a manufacturing site in Newton Aycliffe; and further declares that this would result in the creation of hundreds of direct jobs and thousands of jobs in the supply chain, of which the majority would be in manufacturing, giving a much needed boost to the North East economy and improving rail services nationwide.
The Petitioners therefore request that the House of Commons urges the Government to implement the procurement of rolling stock through the Intercity Express Programme.
And the Petitioners remain, etc. [P000863]
Motion made, and Question proposed, That this House do now adjourn. -(Stephen Crabb.)
Ms Gisela Stuart (Birmingham, Edgbaston) (Lab): To my great surprise, I have just discovered the only joy of being on the Opposition Benches-the wrong side of the House-for an Adjournment debate: I can actually look at the Minister, rather than just seeing his back.
May I declare two interests? One is a formally declarable interest and the other a more personal one. The formally declarable one is that I am an unpaid member of the board of the university of London's international academy. The other one is that I hold a law degree, which the university of London awarded under what in those days was referred to as the "external system".
I must relieve the Minister's anxiety, because despite this debate taking place a day after the Browne report and a week ahead of the comprehensive spending review, I am not asking for money. I thought that I would take away that worry, so that he might relax a little. I am genuinely trying to be helpful, because we need a higher education system that is open, diverse and accessible. Why did I request this debate, and what do I want the Minister to do? I want to put forward a few suggestions. If we all agree that we need to expand the number of people who benefit from quality higher education, we have to do a number of things, some of which Lord Browne pointed to yesterday.
First, and most importantly, we have to stop assuming that the only way in which one can acquire a degree is by being campus-based and studying for three years. Browne is quite clear that we need to move towards a more flexible system that responds to the needs of students and the economy. Secondly, on perhaps a more unpopular point in the current climate, we have debated what the top level of fees should be, but we should stop and consider what we get for those fees. The conclusion that higher fees are either good or bad is too simplistic, because the question is what do universities offer in exchange for the fees that they charge. Thirdly, an even more difficult point is that we have to move away from the belief that there is a magical solution, because at some stage or another someone, somewhere will have to pay for it all. The question is how we raise the money, because nothing comes for free nowadays.
We need to face up to the fact that, first, some degrees from some institutions are of a higher quality and standing than others; they are not all the same. Let us stop pretending that they are. Secondly, some degrees and qualifications offer a better prospect than others of future employment. Thirdly, some people-I suggest an increasing number-will require greater flexibility of access to higher education than traditional universities can offer.
As a result, I want the Minister to face up to some of the perversities that-quite unintentionally, I think-have arisen over the past few years. We have seen universities fined for taking on additional students and given disproportionately little support for part-time students. We will have to encourage institutions such as the university of London and the Open university to provide more high-quality degrees at an affordable price, and with the highest possible flexibility for students.
What is so special about the university of London? People may not be aware of it, but Charles Dickens-well ahead of Alastair Campbell-referred to it as the "people's university". Established in 1838, it was the first university in the United Kingdom to open its doors to women, and in 1858 it launched the external system. For more than 150 years, the university of London has offered students the opportunity to sit its exams without having to attend the university itself. Its alumni include seven Nobel prize winners, such as Nelson Mandela, who studied while imprisoned on Robben island and, more recently, Charles Kao, who received the Nobel prize for physics in 2009 for groundbreaking work carried out in the UK on the science of fibre-optic cable.
The strength and reputation of the university of London is based on the fact that irrespective of how a student acquires the knowledge and where they are based-that is very important-academic standards are not compromised. The present-day mission statement of the university of London's international academy is still faithful to its 152-year history:
"To provide worldwide access to the internationally renowned academic programmes and awards of the University of London and its colleges."
The enormous breadth of academic resources within the federal university of London enables a range of collaborations within the university to deliver the programmes. The basis of the collaboration between the colleges and the central university is that the academic expertise is located in colleges, whereas the central university undertakes administrative support for the students and other agencies here and abroad.
There is no comparable university offering flexible and worldwide access to degrees of such high international standing. There are currently some 45,500 students in 180 countries studying by distance and flexible learning, with another 6,000 in the UK. The university receives no teaching grant for its external students, and UK-based students are entirely self-funding. The university of London's international academy may already be well adapted to the new realities to which Lord Browne's report is pointing us.
Fees are identical across the 180 countries. For example, the largest individual set of programmes-those provided in collaboration with the London School of Economics-cost in the order of £3,500 for the entire degree. That includes materials, access to an online library, and all examination fees. Globally, some 70% of undergraduate students also pay fees to local third-party providers to obtain learning support, but the majority of UK-based students study on their own. If one compares that with an annual fee for a traditional English campus-based degree of £3,290, one can see that the university of London's international programme offers remarkably good value for money for unsubsidised provision.
How does it work? Let me describe how I took my degree; this may explain why the Member for Birmingham, Edgbaston, who has Birmingham university on her patch, is making a pitch for London university. It was the early '90s, I was in Worcestershire, and I had two small children. I wanted to go back to university to kick-start my brain, and I thought that a law degree would be a very good way of doing it. There was no way, financially or practically, that I could have done a campus-based degree, but I could take two years to do
year 1, studying tort, contract law and the English legal system by attending lectures at Worcester college of technology, franchised from the university of Worcester. For year 2, studying land law, tort and trust law, I could find local lectures, but for European Union law I attended weekend courses in Cambridge. For year 3, I went down to London on a Friday night to attend lectures on contract law. Incidentally, an exceptionally good lecturer at the time was someone called Nick Bourne, who is now the Conservative leader in the Welsh Assembly Government. For private international law and jurisprudence, I was essentially on my own. That extraordinary mixing and picking of attending courses, doing things on my own and going to other places gave me the flexibility to acquire a degree within a four-year period, at a cost that I could handle, that no other system could have provided.
There were two highlights. One of those was winning the Convocation prize for land law, which meant that I was invited to Senate house and, for the first time, met other external law students. In those days, in the early '90s, there were quite a number of police officers who would have joined the force without a degree but had to acquire one in order to get promotion. They were men in their early 30s, or even late 30s, who could not have achieved that in any other way. It was extraordinary that even though we were from the hard-nosed '60s generation who thought that prizes were rather pathetic and we were not going to rise to them, we all had to agree that we had a remarkable sense of achievement. The degree ceremony at the Barbican centre was extraordinary, too, and I knew that my 2:1 would stand up to scrutiny from any other institution. There was a meritocracy of commitment and hard work, but the course was diverse, socially mobile and accessible. We should learn from that system.
London university's infrastructure and global scope is also important. It has 550 examination centres worldwide and has local relationships with the British Council, national examination authorities and other organisations. That not only provides flexibility for its students in the UK but gives internationally mobile postgraduates access to its courses. For example, a large number of postgraduates are registered in programmes resulting from the collaborations with the School of Hygiene and Tropical Medicine and the School of Oriental and African Studies. Those students are often practitioners of international public health and/or international development who undertake part of their studies in the UK and part on assignment overseas.
I wish to say a brief word about the Open university. Like the university of London it cannot-nor should it-compete with campus-based universities. The latter provide a tremendous benefit and learning experience. As I said, Birmingham university is in my constituency and I know its importance. However, institutions such as the Open university, with its very good online teaching material, and the university of London add to the available learning provision. Distance learning is an important part of that. The Minister is quoted in the October edition of Prospect as saying that he has proposed that
"it should be easier for new colleges to set up as teaching institutions with degrees externally awarded by another body, such as the University of London-which is how higher education expanded from about 1850 to 1950. It's a way of bringing in new providers and giving students greater choice."
He is absolutely right, and I want to make it clear that London university is not about franchising, which offers opportunities but has inherent dangers. The key thing about the university is that assessment is undertaken by its college-based boards of examiners, to the same standards that are applied to its internal students. That is how it ensures and maintains quality.
I should like the Minister to examine what the university of London's international programme has to offer, ensure that the vested interests of universities do not hamper the diversity of provision, and above all accept that what matters are academic standards, which can be upheld only if there are rigorous examination boards. It will be a success to me if, in five years' time, London university has 50,000 students based in the UK, as it did in the 1950s, as well as its international students. Let us not reinvent the wheel, but let us examine what we already have, see what works and build on it.
The Minister for Universities and Science (Mr David Willetts): I am grateful to the hon. Member for Birmingham, Edgbaston (Ms Stuart) for raising this important issue in the way that she did, because it is of great interest. She began by saying that although it was regrettable that she had to stand on the Opposition side of the House, at least she could look Ministers in the face. I agreed with so much of her speech that she would have been very welcome to deliver it from our side of the House and look at my bald head from behind. It was an excellent speech, and I fully endorse her analysis.
The hon. Lady is a knowledgeable speaker on universities and, as she described, earned her own bachelor of law degree through external study at the university of London.
As the hon. Lady will know, since becoming Minister for Universities and Science, I too have talked about the validation of degrees and external study as a way of realising a more diverse higher education sector. Such arrangements will enable us to enhance and reward good-quality teaching and allow students from all sorts of backgrounds to benefit from a university education, exactly as she eloquently described.
The hon. Lady kindly referred to my comments in Prospect. Of course, in a speech at Oxford Brookes in June, I first tried to set out the argument that the university of London external degree-awarding model could be an important way forward for our HE system. The coalition wants a sector that is open to any provider capable of delivering a high-quality learning experience to students, and one in which the many and varied demands of students are well catered for, and in which providers who are innovative and offer good value for money can thrive.
I should report to the House that the current situation is that any higher education institution with its own degree-awarding powers is free to establish partnership arrangements, including validation, with other institutions, which allows the latter to offer courses leading to the award of degrees. However, I fully understand that the hon. Lady set a rather more demanding test than simply franchising. She talked about people having the ability to sit external degrees and described a direct relationship, and I fully understand the significance of that.
When I have advocated the university of London external degree model, some have worried that it meant
that existing degree-awarding powers would be removed from existing institutions, but that is absolutely not the intention. We also have no intention of micro-managing the exact way in which degrees are delivered. However, we want a sector that is open to a much wider range of delivery models, which certainly includes the kind of arrangements the hon. Lady described in the context of the university of London external degree.
We want to encourage degree-awarding institutions to expand their validation and other external examination arrangements with independent partners, including private providers and further education colleges. A course that is validated at a non-degree awarding institution should be subject to exactly the same quality assurance processes, and therefore be of the same quality and standard, as one taught at the awarding institution. Responsibility for the standards and the quality of all programmes and awards remains with the awarding body no matter the nature of the partnership arrangements. The Quality Assurance Agency ensures that by looking at how the awarding body manages its links with partners, which it does at home and abroad.
However, I take the hon. Lady's point. She specifically wanted to focus on the university of London model. That university has a significant role in the history of the development of higher education in our country. For a century, the majority of English and Welsh universities offered university of London external degrees before they received charters to award degrees of their own. The universities of Wales, Liverpool, Bangor and Bristol-to name but a few-all began in that way. The process, therefore, of setting up a teaching institution that delivered external degrees from the university of London was fundamental to the expansion of higher education, but it retains genuine potential.
New institutions that are focused entirely on teaching could benefit from attaching themselves to established, well-respected university degrees and other qualifications. That is one means for them to build a teaching reputation of their own. That could include, for example, FE colleges looking to improve their HE range or wholly new entrants to the sector. Validation or other external degree arrangements could inspire confidence among applicants, as well as offering them greater choice and cheaper options. They could also help providers to gain traction among employers, who already support a range of externally validated qualifications such as HNDs, HNCs and BTECs, because they represent consistent, trusted standards.
I have already asked the QAA to look at any barriers or implicit assumptions within the quality regime that tie higher education to a model that requires institutions to award their own degrees. Similarly, degree awarding powers should not depend on directly delivering teaching. Any such assumptions should go. Another option is to deliver externally validated degrees online or through teaching centres, as the independent provider Kaplan has started to do. Kaplan is now offering 3,000 places across the country for students to study towards university of London external degrees.
London's external system, recently rebranded as its international programme, is indeed one of the oldest and most successful distance learning delivery systems in the world. Today, there are registered teaching centres in 18 countries, including Bangladesh, Canada, Hong Kong, Jamaica, Switzerland, Thailand and of course
the UK. The system offers more than 100 courses, all of which have been developed by the colleges of the university of London. Students are enrolled as university of London students and are graded to the same standard-the crucial point that the hon. Lady made-but they can access support from teaching centres independent of the university, as well as learning tools provided by the university. Graduates receive a degree certificate from the university of London, and a second certificate indicating the lead institution.
Like externally validated degrees, remote learning through the London international programme, or the excellent Open university courses, gives people more choice so that they can study at a place and a time that suits, often at home-and the hon. Lady gave some good personal examples of that. For new providers, collaboration with a world-class university can give them a foothold in the sector where a validation arrangement may not be practicable.
As well as the domestic challenge, to which the hon. Lady referred, delivery of British higher education qualifications overseas is a growth area, with the university of London and the Open university very much among the pioneers. More and more of our universities, in fact,
are moving into what is known as transnational education, allowing them to teach a broader range of students and to work with more teaching providers than direct delivery alone would achieve. I am delighted that our universities are building their global profiles in that way.
The Government side of the House-indeed, on the evidence of this evening, both sides of the House-believes that external degrees and opportunities for new HE providers can be thoroughly debated in the wake of the Browne review and pursued as we get down to the business of supply-side reform. Both are promising ways of growing the sector cost-effectively during this period of austerity and of innovating while guaranteeing quality, because we would be applying proven methods.
After consultation, the Government intend to provide detailed proposals to which the sector can react. We will publish a higher education White Paper, leading-we hope-to a higher education Bill in autumn 2011. That will be an opportunity to consider the ideas that the hon. Lady and I have put forward in the past. It only remains for me to thank her once again for raising these important matters tonight.