The House divided:

Ayes 25, Noes 247.

Division No. 146]


12.48 pm


Alexander, rh Mr Douglas

Ali, Rushanara

Bailey, Mr Adrian

Brown, Lyn

Campbell, Mr Alan

David, Wayne

Fitzpatrick, Jim

Gapes, Mike

Greatrex, Tom

Green, Kate

Hamilton, Mr David

Hilling, Julie

Hodgson, Mrs Sharon

Jamieson, Cathy

Jones, Mr Kevan

Jones, Susan Elan

McCarthy, Kerry

Mudie, Mr George

Onwurah, Chi

Pound, Stephen

Smith, Nick

Spellar, rh Mr John

Thomas, Mr Gareth

Williamson, Chris

Winterton, rh Ms Rosie

Tellers for the Ayes:

Nic Dakin


Heidi Alexander


Adams, Nigel

Afriyie, Adam

Aldous, Peter

Andrew, Stuart

Arbuthnot, rh Mr James

Baker, Steve

Baldry, Sir Tony

Baldwin, Harriett

Barclay, Stephen

Barker, rh Gregory

Baron, Mr John

Bebb, Guto

Bellingham, Mr Henry

Benyon, Richard

Beresford, Sir Paul

Berry, Jake

Bingham, Andrew

Binley, Mr Brian

Blackman, Bob

Boles, Nick

Bone, Mr Peter

Bottomley, Sir Peter

Bradley, Karen

Brady, Mr Graham

Bray, Angie

Brazier, Mr Julian

Brine, Steve

Brokenshire, James

Bruce, Fiona

Buckland, Mr Robert

Burley, Mr Aidan

Burns, Conor

Burns, rh Mr Simon

Burrowes, Mr David

Byles, Dan

Cairns, Alun

Carmichael, Neil

Carswell, Mr Douglas

Cash, Mr William

Chishti, Rehman

Chope, Mr Christopher

Clark, rh Greg

Clifton-Brown, Geoffrey

Coffey, Dr Thérèse

Collins, Damian

Colvile, Oliver

Crabb, Stephen

Crouch, Tracey

Davies, David T. C.


Davies, Glyn

Davies, Philip

de Bois, Nick

Djanogly, Mr Jonathan

Dorries, Nadine

Doyle-Price, Jackie

Drax, Richard

Duddridge, James

Duncan, rh Mr Alan

Dunne, Mr Philip

Ellis, Michael

Ellison, Jane

Elphicke, Charlie

Eustice, George

Evans, Graham

Evans, Jonathan

Evans, Mr Nigel

Evennett, Mr David

Fabricant, Michael

Fallon, rh Michael

Field, Mark

Fox, rh Dr Liam

Francois, rh Mr Mark

Freeman, George

Freer, Mike

Fullbrook, Lorraine

Fuller, Richard

Gale, Sir Roger

Garnier, Mark

Gauke, Mr David

Gibb, Mr Nick

Gillan, rh Mrs Cheryl

Glen, John

Goldsmith, Zac

Goodwill, Mr Robert

Graham, Richard

Gray, Mr James

Grayling, rh Chris

Green, rh Damian

Greening, rh Justine

Grieve, rh Mr Dominic

Griffiths, Andrew

Hague, rh Mr William

Halfon, Robert

Hammond, rh Mr Philip

Hammond, Stephen

Hancock, Matthew

Hands, Greg

Harper, Mr Mark

Harrington, Richard

Harris, Rebecca

Hart, Simon

Haselhurst, rh Sir Alan

Hayes, rh Mr John

Heald, Oliver

Heaton-Harris, Chris

Henderson, Gordon

Hendry, Charles

Herbert, rh Nick

Hinds, Damian

Hollingbery, George

Hollobone, Mr Philip

Holloway, Mr Adam

Hopkins, Kris

Howarth, Sir Gerald

Howell, John

Hunt, rh Mr Jeremy

Hurd, Mr Nick

Johnson, Gareth

Johnson, Joseph

Jones, Andrew

Jones, rh Mr David

Kawczynski, Daniel

Kelly, Chris

Kirby, Simon

Kwarteng, Kwasi

Lancaster, Mark

Lansley, rh Mr Andrew

Latham, Pauline

Leadsom, Andrea

Lee, Jessica

Lee, Dr Phillip

Lefroy, Jeremy

Leigh, Sir Edward

Leslie, Charlotte

Letwin, rh Mr Oliver

Lewis, Brandon

Liddell-Grainger, Mr Ian

Lidington, rh Mr David

Lilley, rh Mr Peter

Lopresti, Jack

Lord, Jonathan

Loughton, Tim

Luff, Peter

Lumley, Karen

Macleod, Mary

Main, Mrs Anne

Maude, rh Mr Francis

May, rh Mrs Theresa

Maynard, Paul

McCartney, Jason

McCartney, Karl

McIntosh, Miss Anne

McPartland, Stephen

McVey, Esther

Menzies, Mark

Metcalfe, Stephen

Miller, rh Maria

Milton, Anne

Mordaunt, Penny

Morgan, Nicky

Morris, Anne Marie

Morris, David

Morris, James

Mosley, Stephen

Mowat, David

Murray, Sheryll

Murrison, Dr Andrew

Neill, Robert

Newton, Sarah

Nokes, Caroline

Nuttall, Mr David

O'Brien, rh Mr Stephen

Offord, Dr Matthew

Opperman, Guy

Ottaway, rh Richard

Parish, Neil

Patel, Priti

Paterson, rh Mr Owen

Pawsey, Mark

Penning, Mike

Penrose, John

Percy, Andrew

Perry, Claire

Poulter, Dr Daniel

Prisk, Mr Mark

Raab, Mr Dominic

Randall, rh Sir John

Reckless, Mark

Rees-Mogg, Jacob

Reevell, Simon

Robertson, rh Hugh

Robertson, Mr Laurence

Rosindell, Andrew

Rudd, Amber

Ruffley, Mr David

Rutley, David

Sandys, Laura

Scott, Mr Lee

Selous, Andrew

Shapps, rh Grant

Sharma, Alok

Shepherd, Sir Richard

Simmonds, Mark

Simpson, Mr Keith

Skidmore, Chris

Smith, Chloe

Smith, Henry

Smith, Julian

Soubry, Anna

Spelman, rh Mrs Caroline

Spencer, Mr Mark

Stephenson, Andrew

Stevenson, John

Stewart, Bob

Stewart, Iain

Stewart, Rory

Stride, Mel

Stuart, Mr Graham

Sturdy, Julian

Swayne, rh Mr Desmond

Syms, Mr Robert

Timpson, Mr Edward

Tomlinson, Justin

Tredinnick, David

Truss, Elizabeth

Turner, Mr Andrew

Tyrie, Mr Andrew

Uppal, Paul

Vaizey, Mr Edward

Vara, Mr Shailesh

Vickers, Martin

Walker, Mr Charles

Walker, Mr Robin

Watkinson, Dame Angela

Weatherley, Mike

Wharton, James

Wheeler, Heather

White, Chris

Whittaker, Craig

Whittingdale, Mr John

Wiggin, Bill

Williamson, Gavin

Wilson, Mr Rob

Wollaston, Dr Sarah

Wright, Jeremy

Young, rh Sir George

Zahawi, Nadhim

Tellers for the Noes:

Gavin Barwell


Mr Sam Gyimah

Question accordingly negatived.

29 Nov 2013 : Column 569

29 Nov 2013 : Column 570

29 Nov 2013 : Column 571

Clause 5

Short title

Amendment made: 81, page 2, line 21, at beginning insert—

‘( ) This Act extends to—

(a) England and Wales, Scotland and Northern Ireland; and

(b) Gibraltar.’.


Amendment made: 82, in line 1, after ‘Kingdom’, insert ‘and Gibraltar’.—(James Wharton.)

Third Reading

1.2 pm

James Wharton (Stockton South) (Con): I beg to move, That the Bill be now read the Third time.

We have had extensive debate, discussion and scrutiny of what is a short Bill with but a handful of clauses. However, its significance should not be underestimated. It is a commitment from the Conservative Benches to give the British people a say on that most important of matters: our membership of the European Union.

I do not intend to detain the House for long, because we have discussed in great detail each clause and each possible amendment. The House has gone through each change that could be made and has made its views clear. We have considered the franchise and extended it to give the people of Gibraltar a say. I congratulate my hon. Friend the Member for Romford (Andrew Rosindell) on his work to bring that proposal forward. We have considered the wording of the question. It is clear that it is fair, that it is clear and that it is the right question to put to the British people. We have considered the timing. It is clear that the House believes that it is right to go back to Europe to get the best possible deal and, whatever that deal looks like, to put it to the British people in an in/out vote. This morning, we have discussed the conduct of the referendum.

I am grateful to all colleagues who have provided support and to my Conservative colleagues who have shown discipline and resolution to get this important Bill through. I am also grateful to Opposition Members and colleagues on the Liberal Democrat Benches who have contributed, albeit sometimes in a rather long-winded way.

We have had a good and thorough debate. It is time that we let Britain decide. I commend the Bill to the House.

1.4 pm

Chi Onwurah (Newcastle upon Tyne Central) (Lab): It is a pleasure to be here today discussing the weaknesses and divisions within the Conservative party. Instead of dealing with the record-breaking cost of living crisis from which our constituents are suffering, we are here, on private Members’ business, discussing how best to create four years of uncertainty for British jobs and investment. For families in Newcastle and across the country, the daily worry is how to make ends meet after 40 months of prices rising faster than wages. That is what should be occupying the Conservative party and the hon. Member for Stockton South (James Wharton). It is to be hoped that after the next election the constituents

29 Nov 2013 : Column 572

of Stockton South will have a Member who represents their economic interests and understands the crises they are facing.

Madam Deputy Speaker, it will not have escaped your attention that the House has not been especially overwhelmed with business lately. This Government Bill, masquerading as a private Member’s Bill, is being pushed through like this to try to support a weak Prime Minister. It is therefore not surprising that the Minister without Portfolio, the right hon. and learned Member for Rushcliffe (Mr Clarke), is not in his place to do that.

Democracy is about more than just voting and a referendum every 30 years or so; it is about debate and engagement too. Members will recall the most recent referendum we had—Liberal Democrats might wish to forget it—which was on the electoral system of the UK. I suspect that many people used that referendum to give the Liberal Democrats a good kicking—a noble enough reason perhaps, but it certainly did not create much of a debate around our complex constitutional arrangements, especially among those who had taken no previous interest. My fear, therefore, is that any debate preceding a referendum, at a time when European economies are in so much trouble, will not be based on a sober reading and reporting of the facts.

The north-east, in particular, cannot afford to put yet another obstacle in the way of this spluttering recovery. The north-east benefits hugely from our membership of the EU. It is the only net exporting region in the UK, so it needs to know for certain that we will have access to this market, but the Bill jeopardises that certainty. The North East chamber of commerce recently forecast that in our region 1,800 firms would close and 40,000 jobs be destroyed as a result of an EU exit. We cannot afford that.

The Chancellor has given up on his supposed export-led, manufacturing-driven recovery, and instead has gone for a housing bubble. We cannot afford to lose any more markets for our exports. Nissan has made it clear that its significant investment and presence in the north-east was built upon the assumption that it would serve as a platform for entry into European markets. Great manufacturing companies such as Nissan are working to long-term time scales. It takes time to build a manufacturing line, and even more time to recoup the investments. These companies will be making decisions now about 2017 and 2020, and if they see a huge policy uncertainty on the horizon, that will put off investment and put jobs at risk. The CBI reported last week:

“No alternative to EU membership offers a better balance of advantages and disadvantages or greater influence for the UK”.

I do not say that the EU is perfect; far from it. It needs to be more democratic and accountable, and like many hon. Members, I would like to see a reformed EU that works in the interests of all its citizens, but the UK needs to be at its heart, leading those reforms: a strong voice at the heart of a strong union. The Bill does nothing to bring that about, however, and I will be voting against it.

1.9 pm

The Secretary of State for Foreign and Commonwealth Affairs (Mr William Hague): It is a pleasure to speak briefly on the Third Reading of this important Bill. I particularly commend my hon. Friend the Member

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for Stockton South (James Wharton) for introducing the Bill and steering it so skilfully through this House. I am doubly pleased as he is my constituency neighbour, and I can tell the hon. Member for Newcastle upon Tyne Central (Chi Onwurah) that my hon. Friend should yield to no one as a champion of his constituency, including its economic interests. I have seen that he does that very well. He has shown great ability in handling this Bill, which is appreciated across the House. We now know that our youngest colleague is one of our brightest stars.

This Bill is about democracy and Britain’s future in Europe. It will set down in law the British people’s right to decide at the right time on the right question. Under the lamentable record of the Labour party, the EU was for 13 years taken in a direction that the British people did not agree with, but Labour never had the courage to consult the British people in a referendum and never once gave the British people their say.

We have shown in three and a half years—[Interruption.] Labour Members do not like being reminded of this, but the shadow Foreign Secretary was the Minister for Europe when he gave up £7 billion of the British rebate. Labour cut the rebate, so perhaps the right hon. Member for Paisley and Renfrewshire South (Mr Alexander) would like to apologise for that.

Mr John Spellar (Warley) (Lab): The Foreign Secretary is going back in history a little, so will he remind us when the Conservative party last held a referendum on the EU and, indeed, which party did hold a referendum on EU membership?

Mr Hague: The right hon. Gentleman has to go right back to the 1970s, so he cannot accuse me of going back into history. Going back to 2005, when Labour gave up the rebate, is not going back very far. If he is so proud of Labour’s record on a referendum, he should be in favour of one now and in favour of establishing it in law. Labour Members do not have the courage to do so. Where they cut the rebate, we have cut the EU budget; and where they got us into eurozone bail-outs, we have got Britain out of them. We have achieved real reform of Europe’s most disastrous policy—the common fisheries policy.

Mike Gapes: Will the right hon. Gentleman give way?

Mr Hague: I will not give way to the hon. Member for Ilford South (Mike Gapes), whose views have been delivered at great length over many hours. He has dragged himself reluctantly and slowly through the Division Lobbies, so I do not think we need to hear from him during my speech.

We have pushed forward free trade.

Wayne David: Will the right hon. Gentleman give way?

Mr Hague: No, I am afraid that the hon. Gentleman falls into the same category as the hon. Member for Ilford South.

We have every reason to be confident that we can negotiate a new deal in Europe. Above all, the final

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decision to stay or leave must lie with the British people. This Bill enacts precisely that democratic choice. It requires a referendum by the end of 2017, allowing time for the British Government to negotiate a new settlement.

Mr Bailey rose

Mr Hague: I am not giving way.

The question in the referendum is clear.

Mr Thomas rose

Mr Hague: I will give way to the Front-Bench Member.

Mr Thomas: I am grateful.

We repeatedly tried, as did Conservative Back Benchers, to ask the Minister for Europe what powers and competences the Prime Minister wants to bring back as a result of the treaty change that he says is coming. We got no clarity from the Minister for Europe; will the Foreign Secretary provide it now?

Mr Hague: The Prime Minister’s programme was set out clearly in his speech of 23 January, and his agenda is getting increasing support across Europe. It is time that the Opposition adjusted to the reality of the future and started to support it, instead of saying that uncertainty is being created in the British economy. They have neglected to notice that UN figures show that in the first half of this year, the UK attracted more inward investment not only than any other European country but than any other country in the world. That is the situation over which we are presiding. Labour’s is the policy of uncertainty. Labour Members are not even certain when they can resolve the uncertainty about their own policy! They have been unable to tell us about their own position on a referendum. After the shadow Foreign Secretary spoke on Second Reading, no one was any the wiser about whether Labour was in favour of the Bill, against it or indifferent to it. We hope that the Opposition will catch up in the future, as they did with the European Union Act 2011, which they treated with the utmost apathy, but have since come to support as part of our constitutional framework.

It is right for the people to be given their say. It is right for a British Government to seek a new settlement in Europe. It is right for us to put that on the statute book now. My hon. Friend the Member for Stockton South has been outstanding in putting the Bill before us. It deserves our support on its Third Reading today.

1.15 pm

Mr Douglas Alexander (Paisley and Renfrewshire South) (Lab): I thank the former shadow Europe Minister, my hon. Friend the Member for Wolverhampton North East (Emma Reynolds), and the current shadow Europe Minister, my hon. Friend the Member for Harrow West (Mr Thomas), for providing the Bill with what we judge to be an appropriate and necessary level of scrutiny both in Committee stage and on Report. I thank the other Committee members and the contributors to those debates. Indeed, the Bill’s promoter, the hon. Member for Stockton South (James Wharton), who spoke today—that was a particular pleasure—has at least been present when the Bill has been debated and discussed over recent weeks.

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Let me briefly address the points raised in Committee and on Report. Alas, the Bill comes to Third Reading with all the fundamental issues and concerns that were raised still unresolved, with the exception of the issue of Gibraltar, where, I am glad to say, we were able to make some progress from the Labour side.

In truth this is a Bill not about the Conservatives trusting the public but about Conservative Back Benchers not trusting a Conservative Prime Minister.

Mr William Cash (Stone) (Con) rose

Mr Alexander: I will make a little progress, and then I will be happy to take some interventions. Let us be clear about what has happened over the course of recent weeks. The Bill started with a breakfast at Downing street for Conservative Back Benchers. Last week the Prime Minister again offered Conservative Back Benchers breakfast at Downing street. It is not clear whether it was a continental breakfast, but it was certainly breakfast at Downing street. The Prime Minister seems to be seeking unity through a strategy of obesity. He is clearly worried that if he is not doing the cooking, then all too shortly he will be on the menu. Any judgment about an in/out referendum on the United Kingdom’s membership of the European Union has to be based on what is in the UK’s national interest. We do not believe that the Bill’s proposal for an in/out referendum in 2017 is in the national interest, which is why we are not supporting it.

The Bill anticipates an arbitrary timetable for an in/out referendum in 2017 in the United Kingdom divorced from any serious assessment of the likely timetable for treaty change across Europe. When the Prime Minister first announced his new policy back in January, he argued that treaty change was inevitable, necessary and indeed desirable. He said in April:

“I am sure there will be treaty change.”

He went on to say:

“I’m absolutely convinced that there will be the need to reopen at some stage these treaties”.

Yet the prospect of treaty change seems less likely today than it was when the Prime Minister made those remarks about which the Foreign Secretary spoke only a moment ago. Indeed it is significant that the German Government now seem less inclined to push for immediate treaty change, instead favouring intergovernmental agreements under article 114 of the EU treaty. Indeed in May this year, the German Finance Minister Wolfgang Schaeuble, said explicitly:

“Banking union is a central project, we need institutional changes but we cannot wait for a treaty change.”

Only this week, the grand coalition document, which will form the basis of the German Adminstration’s governing agenda, was agreed, and it made not a single reference to the prospect of treaty change. The truth is that the date of 2017 had more to do with Tory party management than EU-wide treaty change.

Mr Cash: Given the fact that the former Prime Minister Tony Blair promised a referendum on the constitution, will the right hon. Gentleman tell us, in the context of this incredibly important Bill, whether or not the Labour party has ruled out having a referendum on the European Union?

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Mr Alexander: I could not have asked for a kinder intervention given that I am keen to talk about the views of former Prime Ministers of the United Kingdom. Why do we not start with the former Member for Huntingdon? The truth is that this Bill, although presented as a Bill about Britain’s relationship with Europe, is more to do with the Prime Minister’s relationship with his party. Only last night, the former Member for Huntingdon—a man who knows a bit about dealing with querulous Back Benchers—talked about Britain voting to leave the EU. He said:

“In a world of seven billion people, our island would be moving further apart from our closest and largest trading partners, at the very time when they, themselves, are drawing closer together. This makes no sense at all.”

Those are not my words but the words of the last Conservative Prime Minister who actually secured a majority.

The former Prime Minister is not simply opposed to exit; he is also opposed to the Bill. He said:

“I’m not in favour of Mr Wharton’s Bill.”

He went on to say that

“I think the Wharton Bill is a negative, not a positive”.

Why does he believe that it is a bad Bill? He thinks that the Conservatives should be spending their time focusing—again, let me quote him directly—on issues such as

“taxes, jobs, education, health and”—

wait for it—

“living standards.”

He is not wrong, of course, but when we hear those words coming from a Conservative we have a sense that irony has left the building.

Although the private rationale for the Bill is to bind the Prime Minister’s hands by committing him to a referendum, the public rationale is to strengthen his hand in negotiations. The only problem is that as of today, even after the Foreign Secretary’s speech, we are no clearer about what exactly that negotiating position is. The Prime Minister has chosen to try to achieve the veneer of unity through the device of obscurity. That is why when he delivered his speech last January, in which the Foreign Secretary sought to seek refuge only a few moments ago—I am sure that Conservative Members do not need to be reminded of this fact—the word “repatriation” did not appear five times, or 10 times. It did not appear once. The Prime Minister did not utter the term “opt-out” and the words “employment law” were never even mentioned.

Indeed, on Second Reading the Minister for Europe, whom I am glad to see back in his place, was asked by the shadow Minister for Europe whether he would enlighten the House about which powers and competences the Prime Minister wants to repatriate to the UK. Alas, he missed that opportunity and if he would like to intervene and explain now which powers he is seeking to repatriate, I will more than happily give way. Suddenly, he seems to have found his briefing papers incredibly interesting.

The shadow Minister for Europe and the hon. Member for Gainsborough (Sir Edward Leigh) asked the same question last week—these are not questions that are just being asked by Labour Members—but alas, no answer was forthcoming. All we were greeted with was the sound of silence. The reason for this is that despite

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the Prime Minister’s speech, despite agreeing a date, and despite the Bill, this truth still endures: the gap between what the Conservative Back Benchers demand and what the Conservative Prime Minister can deliver remains achingly unbridgeable.

On the day the Bill reached its Report stage, the chief executive of Nissan issued a stark warning to the Government about the prospects of the UK leaving the EU, highlighting that jobs, investment and growth would be put at risk. As we have just heard from my hon. Friend the Member for Newcastle upon Tyne Central (Chi Onwurah), there are real and deep concerns in a number of regions of this country about the consequences of exit. The chief executive of Nissan said:

“Obviously it’s going to be a major factor happening and we are going to need to consider what does it mean for us for the future. I’m not worried about Sunderland. Sunderland is a very competitive plant, it’s a very productive plant and it’s a European plant based in the UK. If anything has to change, we need to reconsider our strategy and our investments for the future.”

Those remarks echoed those made by the Government of Japan. The Japanese embassy has even contributed to the Foreign Secretary’s balance of competences review. Let me share with the House the paragraph the embassy contributed on inward investment:

“More than 1,300 Japanese companies have invested in the UK, as part of the Single Market of the EU, and have created 130,000 jobs, more than anywhere else in Europe. This fact demonstrates that the advantage of the UK as a gateway to the European market has attracted Japanese investment. The Government of Japan expects the UK to maintain this favourable role.”

The EU gives us influence collectively that when we act alone we lack, and it does so at a time in our history when that has arguably never been more important, not least because today we are living in the early years of what many regard as an Asian century. As Asia rises, Europe must find new ways to amplify its voice and extend its influence.

Defending the UK’s place in the EU is not a matter of outdated sentiment but a matter of simple arithmetic. In an age of countries the size of continents, our membership of the EU gives us access to and influence in the world’s biggest global trading bloc and the prize of opening up new markets.

Heidi Alexander (Lewisham East) (Lab): My right hon. Friend will know that the CBI estimates that up to 5% of the UK’s total economic output could be lost if Britain withdraws from the EU. Will he share his thoughts on why he believes the Conservative party and the Government are so willing to put those jobs and that investment at risk?

Mr Alexander: The answer, I fear, is that the dynamic and driver of the Bill, as evidenced by the conduct of the debates, is the management of the Conservative party, not the interests of the country. Sir Roger Carr’s remarks and the CBI’s report are a devastating critique. Hon. Members need not take my word for it; they can look at the remarks I have quoted from the former Member for Huntingdon, the former Conservative Prime Minister, who recognises that this time of economic challenge is far too serious for the risks that the Conservative party seems willing to run to protect Conservative

29 Nov 2013 : Column 578

Members’ jobs—at the same time, they are putting the jobs of tens or hundreds of thousands of British workers at risk.

The tragedy is that, because the Prime Minister is unable to address properly the need for reform in Europe in a sensible and effective way, he has been driven to the position he is in. The Bill is being taken forward by a party divided in all reality between those who are seeking consent and those who are seeking exit. They are united only in their mistrust of the Prime Minister. The Bill is not about trusting the people; it is about Tory Back Benchers not trusting a Tory Prime Minister.

In these tough economic times, Britain deserves better. Reform in Europe, not exit from Europe, is the right course for our country.

1.26 pm

Mr Bailey: I cannot support the Bill because, first and foremost, it is a politically driven Bill, adopted by the Government not in the national interest, but to try to reconcile the mutually hostile and intractable positions of members of the major Conservative part of the coalition.

Mike Gapes: My hon. Friend mentions the Government. There are no Liberal Democrats in the Chamber—that is not unusual—and he would be right to say that of the Government Members present, only the Conservatives are here. However, the Bill is not a Government Bill. It is important to emphasis again that the Bill is a private Member’s Bill that is not supported by the Government.

Mr Bailey: I was coming to that point. In all my years in the House, I have never known a private Member’s Bill to be adopted so enthusiastically, which it has been by at least one section of the Government—the Conservative party and the Prime Minister. I have never known the devices that have been used to rally support for the Bill to be used before. We are told that Back Benchers have had breakfast in Downing street. The Prime Minister is trying to convince his Back Benchers either to stay in or to come out of the EU using the device of stuffing them with French croissants or, I have heard, bacon baps. Was it Danish or British bacon? I hope that those Conservative Back Benchers who are so hostile to the EU ensured that the Prime Minister stuffed their baps with British bacon to get their vote for the Bill.

On a more serious note, I want to concentrate my few remarks on a vital issue not only for the country, but for the west midlands and my constituency in particular. A lot has been said—my hon. Friend the Member for Newcastle upon Tyne Central (Chi Onwurah) emphasised this—about the potential impact on foreign direct investment in this country arising from the uncertainty that will be created by a decision to hold a referendum in 2017. If we ask investors what the most crucial thing to ensure that they invest in a place is, they will answer, “Certainty.” If people are to invest money, they want to know on what basis that money will be used and what returns can reasonably be generated. If there is uncertainty about the scale of the market for British manufacturers, the prospect of encouraging foreign direct investment will be very much more limited.

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Outside investors are not daft. When they see the Government—or the Conservative party—backing a Back-Bench Bill such as this one, they can see the way the wind is blowing and they are bound to question whether they should be investing in this country again. As my hon. Friend said, major manufacturers in this country are already questioning their long-term commitment to it as a result of the uncertainty being created by this Bill.

The Bill conflicts with the Government’s asserted priorities, too. We are told that they are reducing corporation tax to encourage foreign direct investment, but what is the point of doing that if they are at the same time reducing the potential market for the products that would be generated by that investment from 500 million people to 60 million? The two policies are totally contradictory, as outsiders with money to invest in Britain will notice.

The situation has particular importance for my west midlands constituency. It is fair to say that the recession has not had nearly as bad an overall impact as it might have had, largely because of the rejuvenation and renaissance of the motor industry, which has been centred in particular on the expansion of Jaguar Land Rover. My constituency has more foundries than any other, and they are often third, fourth or fifth-tier suppliers to the motor industry. The prospect of a reduction in investment in the key manufacturers in the motor industry is bound to have an impact on the economic prospects of my constituents.

Wayne David: My hon. Friend makes an extremely important point. One thing that is evident from the debate is that there is not an appreciation of the importance of the single market to the European Union. Does he agree that if anything is central to the whole European project, it is the single market?

Mr Bailey: I totally agree. British car manufacturing is a success story; 80% of what we make is exported, with 50% of it going to Europe—Jaguar Land Rover’s major market is the United States. If the Bill goes ahead and there were to be a referendum whereby Britain came out of the EU, we would lose out not only on our major car market, but on the investment, marketing and manufacturing that would go to other countries.

I wish to discuss one other aspect that has perhaps not had the consideration it deserves. We are engaged in an EU-US free trade negotiating process, which, again, will have profound consequences for the British car industry and, in particular, Jaguar Land Rover. The uncertainty created by a decision to pass this Bill and the prospect of our coming out of the EU is bound to affect the final settlement of those negotiations. It is not possible to believe that the US would be prepared to have one settlement with the EU and another with this country. Only by our membership of the EU are we able to have a united position that will give a potential market for cars for both the US and the EU, with enormous benefit. The potential of such an agreement has been estimated at £4 billion to £10 billion in this country.

I could go on, but I recognise that many other hon. Members wish to speak. The crucial point is that the Bill injects an element of uncertainty into much needed foreign direct investment in key strategic industries in

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this country, particularly affecting the west midlands and my constituency. That is why I am not prepared to back the Bill, and I urge others hon. Members to take the same approach.

1.34 pm

Wayne David: I think it is fair to say that we have had an interesting few days. One reason is that the hon. Member for Stockton South (James Wharton) has not been present very often. It is a good parliamentary skill to have a light touch, but it is possible to take things too far.

Mike Gapes: My hon. Friend ought to be fair to the hon. Member for Stockton South (James Wharton)—he has been present, but he has not been participating.

Wayne David: The hon. Gentleman has obviously been a very discreet presence; I thank my hon. Friend for that intervention.

It has also been an interesting few days because the hon. Member for Windsor (Adam Afriyie) tabled an important amendment—a very brave one, given the criticism from his colleagues. Unfortunately, he is not present either; I have not caught sight of him since his amendment was unsuccessful.

We should give collective thanks and praise to my hon. Friend the Member for Ilford South (Mike Gapes) for the large number of amendments he has tabled. Many were probing amendments, which allowed us to have an effective debate and probe the central themes underlying the Bill. Above all, his amendments showed that the Bill has many profound weaknesses; I shall focus on three of those.

First, a fundamental weakness is that the Bill as it stands is an essentially unconstitutional attempt to bind a future Parliament to a decision made in this Parliament. We are well aware of the erudite comments of the constitutional expert Dicey, who said that such a thing was fundamentally contrary to the principle of parliamentary democracy. Attempts have been made to bind subsequent Parliaments to decisions, and they have all come unstuck; all have been unfortunate experiences. I very much regret that although the Government, or the Conservative element of the Government, might declare that that is not the case, there is a profound constitutional question mark over the Bill.

Secondly, as several hon. Members said, the Bill intrinsically creates uncertainty—uncertainty about our membership of the European Union. As Britain is above all else a trading nation, clarity is required about our future trading relations, and our most important trading partner is the European Union. That is a fact. It is not a subjective statement; it is an entirely objective one. Therefore, the question mark that the Bill places over our future membership is extremely damaging and debilitating to Britain’s national interests.

There is another profound weakness in the Bill: the nature of the question that would appear on the ballot paper. It is:

“Do you think that the United Kingdom should be a member of the European Union?”

There are many serious weaknesses in that question. Weaknesses have been pointed out by Members of this

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House, but perhaps more important weaknesses in that question have been pointed out by the Electoral Commission.

The Electoral Commission, as others have said, and which I will repeat because it is so important, is the impartial body that is charged with ensuring that elections of all sorts in this country are conducted fairly. It is profoundly concerned about the wording in the Bill. It has said that the opening phrase, “Do you think that” should be replaced with “Should”. That is a very fair comment. It also says that it would be far better that the question was more open-ended. The question currently says,

“should be a member of the European Union”.

It would be far better if it were less ambiguous and did not imply that Britain at present was not a member of the European Union. The Electoral Commission has gone a stage further and said that perhaps there is scope for Parliament to consider whether, rather than a yes or no question, two alternative statements should be put forward and Members should be able to select which statement they prefer. Sadly, there has not been an opportunity in this House to have that kind of important debate, which the Electoral Commission has suggested.

It is important to recognise that this issue exercises the minds of many in the country, but what has come through clearly from the debate during the last few days above all else is that, yes, people are interested in whether we should continue to be a member of the European Union, but they are also concerned about the lack of information in the public domain to enable them reasonably to come to a conclusion. I hope that the Government will say that there is a need to end the partisan point-scoring on this fundamentally important issue to Britain’s future, and embark upon a bipartisan, cross-party public information campaign, so that people are aware of the important issues at stake. That point is clearly made by the Electoral Commission, and I hope to goodness that in the interests of democracy the Government recognise the need for that to take place.

I very much hope that the Bill will go from this House today to the other place, where I have every confidence that there will be a sensible and rational debate and that amendments will be tabled and agreed to, and that the Government will be positive in their engagement with the other place and will respect the enormous knowledge and expertise there, particularly on European issues. If that is the case, there will be a productive period of consideration in the other place, and when the Bill finally returns to this House, it will be a better Bill as a consequence.

1.42 pm

Mike Gapes: I begin by thanking the hon. Member for Stockton South (James Wharton) for giving us the opportunity to have this extensive three days of discussion of the European Union and issues relating to it. I hope that we will have opportunities later this year and next year to continue such discussions so that we can at last begin to get through the fog of distortion that unfortunately is too prevalent in our newspapers.

I am pleased that the Foreign Secretary is in his place, and I will be quite happy to take interventions from him, even though he was too frit to take one from me. I

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want to remind the Foreign Secretary about referendums and the Conservative party. He was a Minister in John Major’s Government, who did not give a referendum on the Maastricht treaty. Just a few days ago, John Major was quoted as saying that the Bill was not worthy of his support, and that leaving the European Union would be “folly beyond belief”. Will the Foreign Secretary now intervene and tell me whether he agrees that leaving the European Union would be “folly beyond belief”? If he does not want to respond on that issue, he might wish to comment on Lord Heseltine’s statement that the whole process, which has been instigated by the Conservative party, is “an unnecessary gamble” with Britain’s future.




If the hon. Member for Dover (Charlie Elphicke) wishes to intervene rather than shouting at me, I will be happy to take an intervention. If anyone on the Government Benches wishes to intervene rather than muttering and shouting, I will happily give way. If not, I will carry on.

The hon. Member for Windsor (Adam Afriyie), who unfortunately seems to have been in some kind of retreat since he lost the vote on his amendment, will be aware, as will other Members, that I voted for that amendment. I was the only Labour Member to do so. That has caused some confusion on the UKIP website, where messages are going out praising those brave souls who voted for a referendum in 2014. Of course, that includes me, and that is a bit contradictory given some of the other messages about me on the UKIP website; but they will get their line right eventually.

The hon. Gentleman did something very important in highlighting the fact that if we are to have an in/out referendum we should not create a situation of three or four years of unnecessary uncertainty. It has been said of Nissan, but it could apply to many other companies wishing to invest in the European market, whether from South Korea, China or the United States, that potential investment could be put at risk. Such companies could choose to go to another English-speaking country in the European single market, such as the Irish Republic or other countries where they could create investment with certainty beyond 2017 and into the future.

I do not wish to delay the House for too long, but I want to make some important points about this very bad Bill. The Bill has been amended only very specifically with regard to allowing people who are residents of the British overseas territory of Gibraltar to vote in the referendum. The original proposal presumably resulted from an oversight by the Government, who forgot about Gibraltar being part of the European Union in terms of voting in the European Parliament elections. However, British citizens in other British overseas territories will not be allowed to vote in the referendum, although their relationship with the European Union is central to many aspects of their life and their future, and UK membership has big implications for them as well. A few weeks ago, a Committee considered the relationship of the overseas territories of the UK, France and others to the European Union. Our overseas territories people have been rejected by a Conservative whipped vote against one of my amendments. As a result, this message should go out very clearly to British overseas citizens: “The Conservative party does not have your interests at heart—it doesn’t support you.”

Similarly, 1.4 million British people live elsewhere in the European Union. Many of those people—I have received e-mails from some of them—have been living

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in other European countries for more than 15 years and are therefore unable to register to vote in a European election or any other election in this country. They are excluded from the terms of this referendum, and their future could be put in jeopardy. If someone is living in Spain and suddenly their home country is no longer part of the European Union, and their citizenship is then of a non-EU state as opposed to an EU state, there could be huge implications for their future in Spain or in any other EU country. We are denying those people democracy.

Some people are claiming that I am being undemocratic because I am trying to subject—[Interruption.] Yes, some of them are over there on the Conservative Benches. These are the same people who voted against the right of British people living elsewhere in the European Union to have a vote in the referendum. That is what is undemocratic. Conservative Members do not believe that British people living elsewhere in Europe should have a say in this referendum. Only 20,000 people are currently registered as overseas voters, and therefore more than 1 million British people would not be able to take part in this process. Frankly, that is a disgrace.

There are other anomalies such as the situation of people who are married to citizens of other EU countries and living in Britain, with their children in schools or universities here. Those people have an intense interest in the relationship between the United Kingdom and the rest of the European Union. Yet, although we allow them to vote in European Parliament elections, we are to take away the right of those new Europeans to vote in a referendum on the relationship between the EU country from which they originally came and that in which they now live. That is another democratic disgrace. It is typical of the Conservative party. Instead of caring, it has decided to follow the little UKIP tail, which is now wagging the dog that is the Conservative party.

My hon. Friend the Member for Caerphilly (Wayne David) has highlighted how the question has been drawn up for party political reasons. The Daily Mail revealed a few months ago that the original wording had been changed in order to make it more friendly for the Eurosceptics. Frankly, that is typical of this whole exercise. This Bill is not about democracy or giving the British people a choice; it is about the internal mechanics of the Conservative party and managing its internal divisions.

As has been said, this Parliament cannot commit a Parliament that will be elected in 2015 to doing something. The people behind this Bill and the Ministers involved know perfectly well that it is the decision at the 2015 general election that will make the difference. This is a political ploy to try to assuage the Europhobic wing of the Tory party and to keep them on board. The Foreign Secretary and other Ministers are playing a game with their colleagues.

I will not vote against this Bill today, because I believe that the House of Lords now has to subject it to the scrutiny that we have only been able to touch the surface of. The House of Lords needs to take up the

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issues in greater detail than we have been able to, look at the inadequacies of this woeful Bill and expose its contradictions. I do not know how long it will take the House of Lords to do that—this House might get the Bill back at some point—but it needs to do its job properly and not be bounced or have closure motions pushed on it to prevent it from properly scrutinising the provisions.

I am pleased to have played a small part in trying to ensure that this Bill has received proper scrutiny in this House, which is what parliamentary democracy is about. The day we move to plebiscitary democracy will be the day we undermine the rights of Members of Parliament, and that would be terrible.

Wayne David: My hon. Friend is making a very important point. Does he agree that it is disgraceful that the Europe Minister dismissed out of hand the excellent points my hon. Friend has made and the excellent amendments he has tabled in order to facilitate this and previous debates?

Mike Gapes: I am grateful for my hon. Friend’s remarks.

In conclusion, I want to get to the heart of the issue and consider what the terms would be of any renegotiated settlement relevant to a 2017 referendum. We do not know when that will happen; it might happen during the British presidency, but the situation, like many other things in the Bill, is ambiguous. A few months ago, the Foreign Affairs Committee, which is a cross-party Committee with a wide spectrum of views on the issue of Europe, produced a report on which we agreed unanimously, in which we said that

“we are clear that UK proposals for pan-EU reforms are likely to find a more favourable reception than requests for further ‘special treatment’ for the UK. We are sceptical that other Member States would renegotiate existing EU law so as to allow the UK alone to reduce its degree of integration, particularly where this could be seen as undermining the integrity of the Single Market. The Government must reckon with the fact that the body of existing EU law is a collective product in which 27 countries have invested. Our sense is that other Member States want the UK to remain an EU Member. However, we do not think that a UK Government could successfully demand ‘any price’ from other Member States for promising to try to keep the UK in the Union.”

That is the essence of the point. The Government—at least the Conservative party—are trying to sell us a pig in a poke; they are trying to sell us a blank sheet of paper and they have not defined their terms for renegotiation. Indeed, the Foreign Secretary told the Foreign Affairs Committee that that process would not even start until after the general election.

The Bill is a disgrace; it should not be supported, and I hope that the House of Lords will do justice to it and amend it significantly.

Question put and agreed to.

Bill accordingly read the Third time and passed.

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Prime Minister (Replacement) Bill

Second Reading

The Vice-Chamberlain of Her Majesty's Household (Mr Desmond Swayne): I have it in command from Her Majesty the Queen to acquaint the House that Her Majesty, having been informed of the purport of the Prime Minister (Replacement) Bill, has consented to place her prerogative, in so far as it is affected by the Bill, at the disposal of Parliament for the purposes of the Bill.

1.56 pm

Mr Peter Bone (Wellingborough) (Con): I beg to move, That the Bill be now read a Second time.

I am grateful to Her Majesty for her consent.

I clarify that we will not be debating the merits of Mrs Bone replacing the right hon. Member for Witney (Mr Cameron), as the name of my Bill might suggest, but rather the lack of clear succession should the Prime Minister become temporarily, or permanently, incapacitated to perform his duties.

I have asked on a number of occasions what procedure is in place should the Prime Minister be unable to perform his duties. Time and again, on each occasion Ministers have failed to give a substantive response, and I have been amazed at the number of different ways Ministers have dodged, ducked and dived around the question. Responses have ranged from the simply unhelpful reply from the right hon. and learned Member for Camberwell and Peckham (Ms Harman) that

“the Prime Minister is not incapacitated,”—[Official Report, 19 July 2007; Vol. 463, c. 446.]

to the Foreign Secretary’s positively clandestine explanation that

“we do not consider it appropriate to talk about these plans in public”—[Official Report, 17 January 2012; Vol. 538, c. 597.]

Steve Baker (Wycombe) (Con): Has my hon. Friend inquired what has happened in the past?

Mr Bone: That is a good point, but I am looking to the future rather than the past as I am a very modern Conservative.

I am not in the habit of subscribing to conspiracy theories—although I do think there was somebody on the grassy knoll—but there is something strange about the Government’s refusal to state their position on the matter. Could it be that the admission that the right hon. Member for Sheffield, Hallam (Mr Clegg) is next in line to No. 10 is so scary that it would be a breach of national security should it become public knowledge?

In the terrible event of an airstrike on No. 10, we need to know instantly who would be responsible for commissioning a counter-attack. More to the point, we need the potential perpetrators of such an attack to know that we would instantly have the capability to take such decisions. It is preposterous for us to think that there would be time, or indeed the need, for a Cabinet meeting to be called to decide who is in charge. There simply would not be time because the military would need a decision as soon as possible on what action to

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take. It seems common sense that, in such an event, there should be a predetermined line of succession, as there is in the United States of America.

In a majority Government, there would be a clear mandate for the Deputy Prime Minister to take over, as there was when John Prescott was Tony Blair’s deputy. The same cannot be said of the right hon. Member for Sheffield, Hallam, replacing my right hon. Friend the Member for Witney. Surely it is not fitting for the leader of a party that holds less than 10% of the seats in the House of Commons, and maintains a lower approval rating than the UK Independence party, to be positioned to take over from the Prime Minister in a national emergency.

Bob Stewart (Beckenham) (Con): Surely it would be up to Her Majesty the Queen to make an instant decision. As she is so brilliant at everything, she would appoint the appropriate person. I can think of many Government Members who could do the job instead of the right hon. Member for Sheffield, Hallam (Mr Clegg).

Mr Bone: That is a fair point, but—I am thinking the unthinkable—if Her Majesty were killed, we would need to know who was in charge. This is not a light-hearted Bill; it is a very serious Bill. I have not yet heard from the Government—I hope that I will in a little while—on why there should not be a clear line.

The United Kingdom has the right to know who would be at the helm in a terrible event of the kind that I have described. According to MI5, the threat level to the United Kingdom from international terrorism is “substantial”, meaning that attack is a strong possibility. By default, the Prime Minister is clearly one of the most vulnerable figures in the United Kingdom. We deserve to know who would replace him, and in what order, if the unthinkable occurred. Be it the Home Secretary, the Foreign Secretary or the Chancellor, the Government must be clear on who would be in charge if a destabilising event occurred.

Sir John Randall (Uxbridge and South Ruislip) (Con): My hon. Friend is making an interesting case, but there is a flaw in his Bill: in the list of those people who he thinks could be contenders, he seems to have omitted the Chief Whip. In my opinion, the Chief Whip is admirably placed to take command, particularly in times of trouble.

Mr Bone: I am grateful for that intervention from a former deputy Chief Whip, but I took advice from the Clerks of the House, and there were some people whom I could not include on my list. Madam Deputy Speaker, I could not include you, much though I would have liked to, or the Speaker. Some may think that that is the reason I have excluded the Chief Whip; others may think that there are other reasons.

Stephen Pound (Ealing North) (Lab): I hope that the hon. Gentleman will allow me to say that a few of us in the Chamber found his comments about Her Majesty slightly unfortunate. I am sure that he is aware that there is a detailed list of people to succeed Her Majesty that goes as far as the deputy Chief Whip and the Deputy Speaker of the House. There is a great, long list of succession, so that problem would not arise. There

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would be somebody wearing the Crown, and they would be in a position to use their traditional judgment to make that decision.

Madam Deputy Speaker (Dawn Primarolo): Order. All that is absolutely not relevant. I would be grateful if Mr Bone stayed, as I am sure he intended to, on the subject of succession to the Prime Minister, hopefully without mentioning too many cataclysmic events happening to other Members.

Mr Bone: Madam Deputy Speaker, I hope that none of these events takes place. My comments, of course, were entirely about the Prime Minister and which elected person should replace him.

At a time when strong leadership would be more important than ever, the last thing we should be doing is having a debate to decide who is in charge. We need a clear line of succession, and we need it now. In the United States, if the President is killed, there is a list of succession of 18 different office holders. It starts with the Vice-President; then comes the Speaker of the House. It goes all the way down to the Secretary of Veterans Affairs, so even if there is a mass terrorist attack on the American leadership, it will always be clear who is in charge. That person will immediately take over responsibility for the nuclear deterrent and will be able, if necessary, to order retaliatory action. I apologise, Madam Deputy Speaker, but these things have to be said: if a civilian aircraft was deliberately crashed on the White House, killing the President, and other civilian aircraft were heading towards Congress, it would be clear whose decision it would be whether those aircraft should be shot down.

In the United Kingdom, we have no idea who would take over if the Prime Minister were killed. Would it be the Deputy Prime Minister, the Defence Secretary or the Cabinet Secretary? The answer is not clear. It might be an elected person. It might be the Defence Secretary, or it might be the Leader of the House. It might be the Cabinet Secretary. It might be the commander-in-chief of the armed forces. It might be the senior representative of the BBC; after all, the BBC thinks that it runs the country.

Steve Baker (Wycombe) (Con): My hon. Friend is raising some extremely serious issues, and I think that we may be mixing up a number of the functions of government. I visited RAF Coningsby recently to talk to people who were operating on quick reaction alert, and I know that when it comes to that particularly difficult and painful decision relating to airliners—which is surely one of the most unimaginably difficult decisions that a politician might have to make—there are clear and robust procedures in place, and a politician would be the decision maker at all times. I do not think that there is any question that this country always has a political decision maker in relation to our air defence.

Mr Bone: I am grateful for my hon. Friend’s intervention, but I invite him to intervene again, because I am not sure whether he was saying that the ultimate decision was always political, or that the action could be taken without a political decision.

Steve Baker: What I am saying is that a senior politician would always be involved in any such decision in the circumstances that my hon. Friend has described. I am

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not sure how much further I can go in terms of engagement, but I am absolutely clear about the fact that there is always a politician in that chain, and everyone involved knows who it is.

Madam Deputy Speaker (Dawn Primarolo): Order. I must make it clear to the hon. Gentleman and other Members that we are not discussing emergency powers or exceptional circumstances. The purpose of the Bill is to establish the succession that would operate should the Prime Minister be incapacitated. I should like us not to range extensively over events which may be theoretical or real, and which may or may not happen in the United Kingdom to any Member of the House of Commons.

Mr Bone: I thank my hon. Friend for his intervention. I will of course abide by your ruling, Madam Deputy Speaker, but I have to say that my Bill is about exactly that point: it is about what will happen in an emergency when the Prime Minister is killed in a terrorist attack. That is fundamental to the Bill, and it is very difficult for me to discuss it without mentioning events of that kind. Nevertheless, I will move on, because you have given your ruling, Madam Deputy Speaker, and I think that the House has got the drift of what I am saying.

We do not know who would be in charge if something happened to the Prime Minister, and I have therefore come up with an order of precedence. I am happy for the order to be changed in Committee, but this is my first go at it.

The first person on the list is the person bearing the designation of Deputy Prime Minister. The second is the Secretary of State responsible for home affairs. The third is the Secretary of State responsible for defence. The fourth is the Secretary of State responsible for foreign and Commonwealth affairs. The fifth is the Chancellor of the Exchequer. The sixth is the Secretary of State responsible for transport. The seventh is the Secretary of State responsible for health. The eighth is the Secretary of State responsible for business and innovation. The ninth is the Secretary of State responsible for justice. The 10th is the Secretary of State responsible for communities and local Government. The 11th is the Secretary of State responsible for education. The 12th is the Secretary of State responsible for environment, food and rural affairs. The 13th is the Secretary of State responsible for work and pensions. The 14th is the Minister of State responsible for the Cabinet Office. The 15th is the Paymaster General. The 16th is the Secretary of State responsible for culture, media and sport. The 17th is the Attorney-General. The 18th is the Secretary of State responsible for energy and climate change. The 19th is the Secretary of State responsible for international development. The 20th—this is very important—is the Leader of the House of Commons. The 21st is the Leader of the House of Lords. The 22nd is the Secretary of State responsible for Scotland. The 23rd is the Secretary of State responsible for Wales. The 24th is the Secretary of State responsible for Northern Ireland.

There is, however, one caveat: the person taking over from the Prime Minister would have to be a member of the same political party as the Prime Minister. Otherwise, the role would pass to the next person in line.

Before concluding my remarks, I would like to thank two of my researchers who played a big role in putting this speech together, Eliza Richardson and Emma Wade.

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There is a real need for the Bill. It is not actually a joke Bill. We do not know what would happen in such an event. My best guess is that tucked away somewhere in Whitehall there is an envelope that reads, “Open in the case of something horrible happening to the Prime Minister.” I do not think that is good enough. We cannot wait for a terrorist attack before making up our minds about what should happen. We need to know who will replace the Prime Minister if the unimaginable happens.

2.9 pm

Chi Onwurah (Newcastle upon Tyne Central) (Lab): I will not detain the House for long. I would just like to say that the Opposition find this an interesting Bill that raises some interesting questions. We will not seek to prevent it from receiving further scrutiny and debate.

2.10 pm

Sir Edward Leigh (Gainsborough) (Con): I have enormous respect for my hon. Friend the Member for Wellingborough (Mr Bone) and think that he is perfectly entitled to raise these sorts of issues, but I must confess that I have severe doubts about the Bill. If one looks back over history, one must come to the conclusion that it is wrong in our system, in which we do not have a written constitution, to lay down rules. It is much better to rely on people’s good judgment. That is what our system is based on.

I can illustrate that argument by referring to the events of May 1940, when Neville Chamberlain ceased to be Prime Minister. Although he resigned voluntarily following a vote in the House of Commons in which his majority was severely reduced, I cannot help noticing that, according to the list set out in the Bill, the next person in line to succeed him in the event of his having become incapacitated, after the Deputy Prime Minister, would have been the Home Secretary.

Just imagine what would have happened in May 1940 if such a Bill had been passed and if Neville Chamberlain had sadly passed away or become incapacitated. It would not have been Winston Churchill, the saviour of the nation, who took over, but the Home Secretary. For the moment, I cannot remember who that was. My hon. Friend the Member for North East Somerset (Jacob Rees-Mogg), who has an encyclopaedic knowledge of these matters, probably remembers. [Interruption.] I think that it was Lord Anderson—it has come back to me—of the Anderson shelter fame. Certainly he was not the charismatic leader who saved the nation. Any student of history knows that it was touch and go whether Winston Churchill would take over. Lord Halifax was the favourite, both of the King and of the outgoing Prime Minister.

Why do I make those points? We do not want a written constitution in which rules are laid down. We want people to use their good sense. That is what the British parliamentary system is all about. I do not think that it is particularly instructive to follow precedents from other countries. My hon. Friend mentioned the American constitution, which is an entirely different state of affairs. The President of the United States is the Head of State and commander-in-chief, elected by all

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the people, so there has to be a procedure that lays down exactly what happens if he dies or becomes incapacitated. It is not a parliamentary system.

The same goes for the French system, in which, unlike in the American system, if the President dies—President Pompidou died in office—there is an immediate presidential election. The Americans, in their wisdom, determined that the Vice-President should take over automatically, and that there should be an election for a new President, but that is a matter for them and their constitution.

Our system is completely different. If the Prime Minister resigns, as Margaret Thatcher did in more recent times, or sadly passes away or becomes incapacitated, the most senior member of the Cabinet would take over as acting Prime Minister. In the present Cabinet—I will hazard a guess—that is probably the Foreign Secretary. Nobody doubts that he could perfectly adequately, and indeed immediately, take over all the reins of government. There would be a rapid election among the majority parliamentary party, and the person best fitted to become Prime Minister would be elected by his colleagues. They would elect him not on the basis of some written constitution or some arbitrary list of the sort my hon. Friend the Member for Wellingborough has devised, but on the basis of their good sense. That is what our system is about.

Steve Baker: Does my hon. Friend agree that the crucial test is whether such a person can command a majority in this House? That is easily tested by the introduction of a confidence motion, and could be very quickly resolved by the House of Commons.

Sir Edward Leigh: My hon. Friend is of course right to make that point. In our system, which is parliamentary as opposed to presidential, the whole point is that, as in the past, the Head of State—the Queen—appoints as Prime Minister someone who can command a majority in the House, which is what being Prime Minister is all about. There is no mystery about the job: it goes to the person best equipped to command a majority in the House, and the best way to determine who can do that is based not on some arbitrary list laid down, in all his wisdom, by my hon. Friend the Member for Wellingborough, but on the good sense of those who sit in this Chamber.

Mr Bone: My hon. Friend is making a good and powerful speech, but he is slightly wrong about the Bill. I am only suggesting who should take over as Prime Minister immediately, at the moment an attack happens, not in the long term, and I do not think that he is right to say that he knows who that would be.

Sir Edward Leigh: I entirely accept that the scenario my hon. Friend describes is different from the events of May 1940 or the resignation of Margaret Thatcher. Luckily, not many Prime Ministers have died in office. Spencer Perceval was assassinated in the Lobby, a few feet away. As my hon. Friend may remember, Campbell-Bannerman died in office. He was replaced by Herbert Asquith in a perfectly normal way, and from my reading of the history books, I do not think that anybody at the time suggested that the procedures for appointing him were in any way wanting. He was a man of outstanding

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abilities, albeit he was a Liberal—I know that that is a severe disadvantage in my hon. Friend’s eyes—but for all that, there does not seem to have been any difficulty about his appointment.

Jacob Rees-Mogg (North East Somerset) (Con): As I recall, Campbell-Bannerman did not die in office, but he did die in Downing street. Asquith allowed him to stay in Downing street after leaving office because he was so seriously ill, but the leadership had changed.

Sir Edward Leigh: It is a severe mistake to refer to any aspect of history when my hon. Friend is in the Chamber. I talked only this week to David Campbell Bannerman, who is an MEP—he was in UKIP but is now, I am glad to say, in the Conservative party—and he told me that story. Campbell-Bannerman was of course a very sick man and could have died at any moment, but he died in Downing street a week, I think, after he resigned as Prime Minister.

I accept that my hon. Friend the Member for Wellingborough is making a brave thrust at a very unfortunate and very rare situation, but I assure him that such playing around with our constitution is very dangerous. I have to tell him that it is what we would expect from our Liberal friends. I would have thought better of him, and that he would have trusted in the good sense—

Mr Bone: That is the worst insult I have ever heard in the House.

Sir Edward Leigh: I withdraw that remark. It was unparliamentary language, which I should not have used, and I apologise to my hon. Friend. He has made a brave thrust, but dare I say that he is wrong because the Bill is too rigid. Under his list, the Deputy Prime Minister—if he is in the same party as the former Prime Minister—the Home Secretary and then the Secretary of State for Defence would take over, but once people are in those posts, it will be very difficult to shift them. The present system is much better: an acting Prime Minister from among the former Prime Minister’s leading colleagues temporarily steps into the fold and, in its wisdom, the parliamentary party then takes a decision and appoints the best man or woman for the job. On that basis, I rest my argument.

2.18 pm

Steve Baker (Wycombe) (Con): My hon. Friend the Member for Wellingborough (Mr Bone) and I agree more often than we disagree, but I certainly oppose him on this occasion. He has introduced a Bill that he says is a serious one, and we must take his comments at face value. I felt moved to speak only when it became clear that the Bill would be reached this afternoon, and I am a little disappointed that he did not look at experience.

My hon. Friend raised several red herrings, particularly in relation to the Crown and national security. If an urgent matter comes up while the Prime Minister is very temporarily indisposed, I am absolutely confident that our armed forces and the Home Office have appropriate arrangements in place to ensure that any immediate decisions are dealt with properly, and I have already said what some of them are.

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Bob Stewart: It is obvious to me that if there were a national crisis, the Defence Council would meet immediately under the Secretary of State for Defence and, if necessary, decisions would be made by that Secretary of State. I think that such procedures are in place.

Steve Baker: I am grateful for my hon. Friend’s remarks, but I am conscious of your earlier instruction, Madam Deputy Speaker.

It seems to me that my hon. Friend the Member for Wellingborough is being quite harsh on the party that usually sits below the Aisle. That party is perfectly capable of producing first-class statesmen. It has done so in the past and I am certain that it could do so again. I would like to see a true liberal at the Dispatch Box, but I am sure that our party could produce a true liberal. However, that is a subject for another day. We should be a bit more generous to our friends below the Aisle.

We should also be more generous to the House. I am sure that if the House was faced with a choice on whether to express confidence in a Member who did not enjoy the support of these Benches, we would simply vote no and other arrangements would be made through the usual channels.

I am disappointed that the Bill has been introduced. It raises some interesting questions, but many of them are red herrings. The truth is that if the Prime Minister is indisposed in the medium to long term, we have perfectly robust arrangements for selecting a successor. I hope that my hon. Friend will not take the Bill much further.

2.21 pm

Jacob Rees-Mogg (North East Somerset) (Con): Is it not nice that Fridays have got back to normal, Madam Deputy Speaker, and that we are able to debate these important constitutional subjects in calm and splendour, rather than with the freneticism that there might have been earlier?

Today reminds me of 14 July 1789. My hon. Friend the Member for Wellingborough (Mr Bone) comes to this House as a revolutionary, intending to upset a part of the constitution that has served us well since the office of Prime Minister was first filled by Sir Robert Walpole. We have had a wonderfully functioning, effective means of selecting our Prime Ministers that has found some of the greatest people our country has ever produced.

Think of the 18th century and who was selected then: Sir Robert Walpole himself and the great pair of Pitts—Pitt the Elder and Pitt the Younger. Think particularly of Pitt the Younger, who was called forth to serve his country by George III when he was little more than a schoolboy—a brave decision that was made possible only because of the existence of the royal prerogative in the selection of Prime Ministers. No crude list then to say who should come next, to decide and determine, to bind down the royal prerogative and prevent somebody of that stature from being celebrated as Prime Minister.

Think through to the following century and the great Prime Ministers we had then: Lord Liverpool, that wonderfully long-serving high Tory figure, great man that he was, who governed us with such aplomb; Canning and Wellington, another pair of the greatest magnitude—Wellington, that great hero of the nation who saved us from being invaded or taken over by the French and

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who, as Prime Minister, set his face firmly against reform in a most admirable style that we should all rejoice in. There was even a not-half-bad Liberal Prime Minister in the form of Lord Palmerston. Lord Palmerston would know what to do about Gibraltar at the moment, would he not, Madam Deputy Speaker?

Because we do not necessarily have the advantage of using the royal prerogative in getting the people we want and because, according to my hon. Friend the Member for Wellingborough, we now have to go through some list, we could not conceivably get figures of the stature of Lord Palmerston or Disraeli, great flatterer of monarchy that he was.

Mr Brooks Newmark (Braintree) (Con): Will my hon. Friend give way?

Jacob Rees-Mogg: Of course I will give way.

Mr Newmark: In listening to my hon. Friend’s—

Madam Deputy Speaker (Dawn Primarolo): Order. The hon. Gentleman does not appear to have a tie on. That is a requirement of the House. If he goes outside and comes back dressed appropriately, I am sure that the hon. Member for North East Somerset (Jacob Rees-Mogg) will give way again.

Jacob Rees-Mogg: I am so sorry, Madam Deputy Speaker; I had not noticed that my hon. Friend was in fancy dress today. I am glad that proper sartorial standards are being upheld. What would our sovereign think if her Prime Minister were not properly dressed? Perhaps a debate for anther day is whether court dress should be reintroduced for Prime Ministers when they have audiences with Her Majesty. While I am on this subject, it is a great disappointment to me that the Prime Minister, when listing his engagements on Wednesdays, always fails to say that he has an audience with Her Majesty, as his predecessors always used to do. It seems to have dropped out of usage.

Mr Newmark rose

Jacob Rees-Mogg: The colour, good heavens!

Mr Newmark: The colour of my tie has perhaps given me inspiration for my question. Can my hon. Friend envisage a “Kind Hearts and Coronets” scenario in which we run out of every character on the list of my hon. Friend the Member for Wellingborough (Mr Bone)? Also, might we even consider putting the Speaker himself on it to take full command of the House and the country?

Jacob Rees-Mogg: I am grateful to my hon. Friend for raising that crucial point, because I was shocked to discover that advice had been given that the Speaker could not be included on the list. Parliament can put anyone on a list.

Mr Bone: For clarification, I wanted to put Mr Speaker immediately after the Deputy Prime Minister, in third place, but I was told that the House could not contemplate such a thing.

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Jacob Rees-Mogg: I am very worried, given that this is a major constitutional point, that someone is suggesting that Bills introduced into this House can be limited. As long as the sovereign has consented to our considering matters pertaining to Her Majesty’s prerogative, we can put anyone on the list. We could put a lottery winner on it, if we wanted. The House has a right to legislate as it sees fit and not to be held back. There are examples of Speakers going on to be Prime Minister. One thinks of Addington and remembers the little ditty:

“Pitt is to Addington as London is to Paddington”.

It was said rather disparagingly of Paddington, which was thought not to be much of a place in the early 19th century, but which is now a grand place, of course, with a wonderful railway terminus. None the less, Speakers have gone on to be Prime Minister, so I see no reason not to include Mr Speaker on the list.

I have concerns about the list itself, however, partly because it does not refer to people by their proper titles, which I think is an error, and partly because it does not include people in the right order of precedence. The Deputy Prime Minister is in fact the Lord President of the Council, and though he calls himself “Deputy Prime Minister”, there is nothing in the constitution that makes that a proper post. It is just a title given out by Prime Ministers when they face a little political awkwardness and to keep their party on board. I think it was first given to Rab Butler when he needed a sop to cheer him up. It was then given to Lord Heseltine when John Major thought it was a good thing—

Sir Edward Leigh: Geoffrey Howe.

Jacob Rees-Mogg: Oh, I was forgetting about Geoffrey Howe, who was given it when he fell out with the great, almost divine Margaret Thatcher. It didn’t work anyway; it didn’t cheer him up, and he resigned in a huff not much later. It was then given to the noble Lord Prescott to keep the left of the Labour party on board. It is not really a proper constitutional position, whereas the Lord President of the Council—well, he is the fine fellow who makes us regulate the press and goes along to get royal charters introduced.

I am also very disturbed that the Lord Privy Seal is not referred to correctly. In my view, he should be particularly high up the list, because we have such a fine Lord Privy Seal. It is worth bearing it in mind that the title of “Leader of the House” used to be held by the Prime Minister himself, which is a reminder of why that position is of such fundamental importance. Control of the programme of the House is essential to government, and the man or woman in charge of that is a most senior figure in the Government—as I say, it used to be the Prime Minister—so I should like the Lord Privy Seal to leapfrog all the way up, probably ahead even of the Deputy Prime Minister, in recognition of the reality and seriousness of the role.

Mr Bone: I do apologise. My hon. Friend is right about the proper titles and about the Leader of the House. I forgot him when I did the list, which is why he is 20th, but I invite my hon. Friend to table an amendment in Committee. I would accept it.

Jacob Rees-Mogg: I am grateful to my hon. Friend.

There is another lacuna in the Bill. It refers to

“the Secretary of State with responsibility for Business and Innovation”,

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but that great man, that right hon. Friend of mine, wonderful figure that he is, is in fact President of the Board of Trade. He is a very important figure is the President of the Board of Trade. That board, on which also sit people such as the Archbishop of Canterbury, meets very infrequently; it has met a couple of times in the past couple of hundred years, which is about as often as we need most government as far as I can tell.

Then there is the Chancellor of the Exchequer. Since 1714, of course, the post of Lord High Treasurer has been in commission and the First Lord is customarily the Prime Minister and the Second Lord is the Chancellor. If the Prime Minister were incapacitated, the Treasury would remain in commission; it would not need the Second Lord to take on the role of the First Lord—

2.30 pm

The debate stood adjourned (Standing Order No. 11(2)).

Ordered, That the debate be resumed on Friday 3 January 2014.

Business without Debate

Charitable Status for Religious Institutions Bill

Motion made, That the Bill be now read a Second time.

Hon. Members: Object.

Bill to be read a Second time on Friday 3 January 2014.

Romanian and Bulagarian Accession (Labour restriction) Bill

Motion made, That the Bill be now read a Second time.

Hon. Members: Object.

Bill to be read a Second time on Friday 3 January 2014.

Alan Turing (Statutory Pardon) Bill [Lords]

Motion made, That the Bill be now read a Second time.

Hon. Members: Object.

Bill to be read a Second time on Friday 28 February 2014.

Extension of Franchise (House of Lords) Bill [Lords]

Motion made, That the Bill be now read a Second time.

Hon. Members: Object.

Bill to be read a Second time on Friday 3 January 2014.

29 Nov 2013 : Column 596

Margaret Thatcher Day Bill

Resumption of adjourned debate on Question (5 July), That the Bill be now read a Second time.

Hon. Members: Object.

Bill to be read a Second time on Friday 3 January 2014.

EU Membership (Audit of Costs and Benefits) Bill

Motion made, That the Bill be now read a Second time.

Hon. Members: Object.

Bill to be read a Second time on Friday 17 January 2014.

Asylum (Time Limit) Bill

Motion made, That the Bill be now read a Second time.

Hon. Members: Object.

Bill to be read a Second time on Friday 17 January 2014.

Foreign Nationals (Access to Public Services) Bill

Motion made, That the Bill be now read a Second time.

Hon. Members: Object.

Bill to be read a Second time on Friday 17 January 2014.


Motion made, That the Bill be now read a Second time.


Bill to be read a Second time on Friday 17 January 2014.

Stephen Pound (Ealing North) (Lab): On a point of order, Madam Deputy Speaker. With your generous indulgence, let me clarify that I appear to have stumbled over my words and said 13 January, which is not a Friday, instead of 3 January 2014. I meant to say 3 January and hope that the record will show that.

Madam Deputy Speaker (Dawn Primarolo): Thank you. We are grateful for that correction, and I am sure that the record will read accordingly.

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Extractive Industries (Developing Nations)

Motion made, and Question proposed, That this House do now adjourn.—(Mark Lancaster.)

2.34 pm

Eric Joyce (Falkirk) (Ind): I want to take this opportunity to say a few things about the extractive industries, particularly those across the world. Many of our constituencies have an interest in such industries, but it is not necessarily the biggest interest across the whole of our country. In Scotland, of course, most Members have some interest in the oil and gas industries, because of assets in the north or the people who work in the industries. The Grangemouth refinery is on my doorstep. It rarely makes the news, but employs many people. My own family have worked in the oil and gas industries for many years, as have many of my constituents and people who live around the area. Such involvement gives us an interest in the broader extractive industries.

Naturally, our primary concern is for our constituents and our local areas in the UK. However, over the years, my interest has increasingly focused on the impact of large—they are often, although not always, large—companies in the extractive sectors on the economic development of countries across the world. Those companies also have a big impact on the UK because they often pay tax here. They might have their headquarters in the UK, and they employ people in the UK. I am thinking not just of oil and gas—that is what we tend to think about in the UK when we talk about domestic issues—or of small operations that have open-cast mining or deal in aggregates, but large operators that might be headquartered in the UK and that operate in parts of the developing world.

It seems to me—I hope that this does not appear tangential—that when we think about the UK industrial and commercial effort and how it impacts on the developing world, it tends to be almost as a secondary line of debate in the discussion of how the Department for International Development and aid impact on the developing world. What I am saying is that when we think about the economies of the developing world it tends to be about the great good that we do with our munificent and generous taxpayer donations that go through various projects involving European institutions or non-governmental organisations.

It is increasingly important, particularly in the current economic context, that we start to tilt the debate. When we think about developing world economies, we should not simply think about DFID, aid and how fantastically generous we are. Of course DFID does great work, and the Government spend a great deal in this area. Our constituents often say that perhaps that money should be spent at home. The Government are committed to a high level of DFID expenditure, as were the Labour Government, who, one might say, kicked off the whole thing. That is the issue and the figure that people are keen to discuss instead of the figure of inward investment that goes into economies from companies that are either based or headquartered in the UK. I appreciate that for some people there is a significant distinction. It is perhaps worth being up front from the start about the fact that for some people there is a difference between companies that are seen to be truly British or truly operating in the UK and that employ people in the

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UK—I am talking about companies that operate around major assets, such as refineries in the North sea—and companies that are based, headquartered or listed in London, either on the London stock exchange or the alternative investment markets. People often fail to grasp the scale of economic activity that is created through the potential of the extractive industries sector that is headquartered in the UK. What is or is not a British company is a moot point. In many ways, it is not helpful to reflect on that quite deep theological question.

The fact is that many companies that are attracted to investing in the developing world on an enormous scale have chosen to have their headquarters in London. That has sometimes created issues for the extractive industries sector, most notably mining. There have been problems with the listing of particular companies, and their practices before they listed, their management practices, the assumptions owners might have made about how governance should operate and so on are often very different from those that are the culture in the UK. There is an ongoing negotiation, to put it at its mildest, that lays down rules for companies so that when they list in the UK they have to change their culture to fit the high standards of London listing.

There have been one or two well-publicised issues, and I might refer to one of them in a short while, but the standards are generally very high. For companies that list in London and operate elsewhere in the world, there is a large amount of transparency and accountability. The standards in those industries have traditionally been quite high. When new companies come in from elsewhere in the world with different cultural backgrounds, those standards become even more important.

There are two or three initiatives that I want to mention that augment and bolster the standards that already apply in the City of London. One is the extractive industries transparency initiative, which was created just over 10 years ago by the Labour Government and has been carried on by this Government. Oddly, we never actually signed up to it, although I think I understand why. It is a fairly straightforward worldwide initiative signed up to by 25 countries that aims to lay down a standard by which countries agree that all the companies operating out of those countries, or which are listed in those countries, are required to declare what payments they make to Governments, often and usually in the developing world, and the Governments agree to say what payments they have received, as well as other conditions and criteria. That leads to a standard of accountability and transparency that was not there before. The purpose is to de-risk and to make things more realistic and practical for companies that are nervous about relative insecurity or uncertainty about what happens to cash that is paid to Governments. Historically, we know that a lot of cash has gone missing in the developing world. Instead of paying for infrastructure, education or health, it has paid for mansions in Paris or Brussels, or wherever the taste of the person receiving the cash might have led them.

There are other Members in the Chamber who have as much or probably more experience than I have in this, but as we travel across Africa we often end up talking to the people who run young democracies. Companies that are often listed in London come in and try to operate in their countries, and those people are keen to show that the cash is being distributed and used

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appropriately for Government works. Transparency helps them. It also helps companies, which are often wrongly accused of spreading cash around to get contracts when that is simply not true. The idea of greater transparency helps everyone.

Many organisations lobbied for the EITI, but one of my favourites is Global Witness, which George Soros had an important role in creating. In the first two or three years of its existence, most of the heavy work involved encouraging people to sign up to a voluntary arrangement. Now the EU accounting transparency directive and other directives are, in effect, essentially embedding that arrangement into EU law. My understanding is—I could be wrong—that it will be embedded in UK law by 2015. That will not supplant the functions of the EITI, but it will augment them and there will still be a strong purpose in signing up to the initiative.

There is a similar piece of legislation in the States. The Dodd-Frank Bill has an amendment called the Cardin-Lugar amendment, which is still being argued about. It was passed, but there were some issues with how the Securities and Exchange Commission implemented it—perhaps not enough resources were put into it. Some people will say that such legislation does not exist in the US, but it does, it has just not been fully implemented. It will be in due course.

The standards of transparency, which in many ways are above the basic EITI standard, are increasingly high. Within a couple of years, they will be embedded everywhere in all the major markets. The EITI has played an important role in all of that.

Bob Stewart (Beckenham) (Con): I presume the hon. Gentleman gives full recognition to the fact that companies from other countries operating in Africa do not operate under the same rules as British companies, which often gives us a competitive disadvantage. Will he comment on that?

Eric Joyce: The hon. Gentleman makes a good point. We often fail to make a distinction between the developing world of China, Russia and the former Soviet states, and the developing world of impoverished states in Africa and elsewhere. Without wishing to digress—you would pull me up for doing so, Madam Deputy Speaker—it is true that China and Russia have different cultural and transparency assumptions. Most importantly, they have different sovereignty assumptions. They tend to say, “It’s entirely up to a country what it does with its cash. It is not for us to ask.” Chinese companies therefore often operate to a different standard. Many in London are concerned that, if that standard is lower, the small number of people who want to make dodgy deals—they are small in number, but of a significant scale—will do their deals with companies that are not regulated in the UK. That is unquestionably a problem. We must continuously work to have those countries understand that they are major world players and have major responsibilities to ensure that corruption does not once again run amok in Africa. I recognise the hon. Gentleman’s point—he has experience in the field—which is frequently made. I would not want to regulate UK companies in a way that damages them in the context of international competition.

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Currently, the EITI voluntary arrangement has worked well, but statutory underpinning in the UK and US within the next two years will bolster standards in Africa, which is my interest, and in developing countries throughout the world. That is what the countries and the companies want.

The UK Government have agreed to sign up to the EITI, which is great. They were concerned in the first instance that the initiative would lay unnecessary costs on small UK operators, which, frankly, one would not expect to be in the ambit of this discussion. The UK must lead the way and sign up if it wants other countries, such as Angola, which wants to sign up, to do so. Other countries would also like to sign up.

It is a two-year process. By good fortune, I am on the multi-stakeholder group in the UK. The process, which is currently happening, is put in place by a multi-stakeholder group of relevant interested companies from the various industrial sectors, including from the oil, gas, minerals and mining extractive industries; civilian organisations with an interest, such as green and transparency organisations; and the Government—it is led by the Department for Business, Innovation and Skills. It puts the UK in a position to help to lead the world in high standards for the extractive industries.

I want to make one more point. The Government have stressed the importance of beneficial ownership. In the next year or two, legislation will emphasise the importance of beneficial ownership throughout the developing world. That means that we will know where the cash ends up. It is currently possible to construct a series of layers of ownership. We can say that people must declare where the money is going, but they can say, “It goes to company X in the British Virgin Isles,” and we will have no idea who that is. If the Government introduce legislation, which I believe they will, we need to know who beneficial owners are. When companies trade and invest enormous amounts of money in developing countries, the money should go to the appropriate place. From my point of view, that would draw the eye towards the good that enormous and small companies do when they invest in countries that otherwise have very little in the way of revenue.

I shall now conclude, and I do not intend for this to be on a depressing note. The Select Committee on Business, Innovation and Skills is undertaking an excellent inquiry into this whole issue. I have noticed that some people who care passionately about economic development in the developing world seem to set the theoretical principle of the standard so high that they make it almost impossible for companies to invest in the developing world. It seems from the World Development Movement’s submission to the Committee that it does not want any extractive industries to operate in any part of Africa. The reality is that without those industries many countries will simply never develop their economies, and the extractive industries, operating transparently in the way that I have described, are the primary potential driver of economic development. I am talking not about aid, but about proper investment by very large companies that want to carry out extraction that is good for them and their shareholders, and good for the taxpayers of these countries. Such companies are often the biggest taxpayer in these countries and they often represent the only way in which these countries can get good tax revenue and move their economies forward as we want to see them moving forward.

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2.50 pm

The Minister for Skills and Enterprise (Matthew Hancock): I congratulate the hon. Member for Falkirk (Eric Joyce) on securing this debate on the extractive industries and their impact on the developing world. During his speech, I was reflecting on the role of trade, alongside aid, in lifting developing countries out of poverty—he made the case for that powerfully. The rise of Africa and Asia is driven, in the first instance, by the free market operating in a strong framework of the rule of law. We are discussing one aspect of that, and how rules on transparency for the operation of extractive industries can strengthen that process and ensure that British companies and companies across the world can contribute to the growth of developing nations. Not only has he prosecuted his argument well over a long period, but it is gaining salience. The proof of that is in the strong growth rates of many of the countries around the world; so I would probably start on a more optimistic note than he finished on.

I also wish to pay tribute to, and put on the record the Government’s thanks for, the work that the hon. Gentleman does as the civil society representative on the UK extractive industries transparency initiative multi-stakeholder group. He has had an interest in this area for some time. He referred to issues relating to the Grangemouth refinery, and we know that such issues can be political hot potatoes at times, but I have noticed that he always seems to be on the side of those supporting the growth of the British economy, and I am grateful for that.

Natural resources such as oil, gas and minerals make a major contribution not only to this country’s economy, but to those of many developing countries. They can deliver transformational change, if managed well, and can be worth billions to developing countries. For instance, Nigerian oil exports were worth almost $100 billion in 2012—that is more than the total net aid to the whole of sub-Saharan Africa. Interestingly, the acronym BRIC—Brazil, Russia, India and China—has been used for some years to represent the fast-developing countries, but countries such as Turkey and Nigeria are quickly coming into their own and challenging the BRIC countries as the next phase of fast-growth countries.

In 2007, Botswana became an upper middle-income country. In 1996, when it gained independence, it was one of the world’s poorest countries, and its success is largely due to well-managed diamond mining. Such examples show that international mining has the potential dramatically to boost economic growth and provide a route out of poverty for resource-rich countries. Listed and unlisted extractives companies are important partners for us in government. We work together with them to ensure that developing countries make the most of their resources to drive growth and tackle poverty, and do so in an open and transparent way. We work through DFID to help resource-rich developing countries derive the maximum possible benefits from oil, gas and mining projects in the region. We also work directly with companies, Governments and communities across the developing world, including in Africa, to improve the development impact of extractive industries. For instance, we are working with the World Bank in the Democratic Republic of Congo, where we are investing in mining sector reform. Our immediate focus is on conflict minerals in the east, where we are partnering with responsible mining companies.

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Work is under way with UK-based and other extractive companies to build skills and capacity in east Africa, too, where we are evaluating whether to contribute to the African Legal Support Facility. That organisation plays an important role in procuring world-class legal expertise for Governments who are negotiating complex oil, gas and mining investments, so that the Governments of developing countries have the same access to high-quality legal advice as large companies.

We are also committed to increasing transparency in the extractives sector. I want to dwell on several points that the hon. Gentleman made. As he is well aware, we are committed to encouraging strong, transparent and accountable institutions, which can regulate extractives and promote open markets and open societies. Helping to create that environment is an important part of attracting responsible investment too.

The UK presidency of the G8 was used by the Government to commit to working towards common global standards of transparency. Transparency was one of the goals of the summit. We want to level the playing field for business internationally and provide information for citizens around the world, so that they can hold their own Governments to account in the same way as we are held to account in this Chamber. We have launched eight partnerships, working with companies, Governments and civil society in resource-rich countries to improve transparency and build accountability. It was very encouraging to hear the leaders of UK-listed extractives companies, including Sam Walsh, the chief executive officer of Rio Tinto, join us in calling for other countries to adopt common global standards of extractives transparency.

As the hon. Gentleman mentioned, in May the Prime Minister announced that the UK would sign up to the extractives industries transparency initiative. As he said, it is a matter of getting the right balance between transparency to support the good use of resources and ensuring that such transparency is not over-burdensome. The EITI is designed to build trust and dialogue and promote public debate by putting information into the public domain. For instance, in countries with very poor governance, the EITI prompted the first time that different stakeholders sat round the same table to discuss the management of the mining sector. The initiative has a direct impact.

Many extractive companies listed or headquartered in the UK are active in supporting the EITI. Shell sits alongside Rio Tinto on the international EITI multi-stakeholder board. By signing up, we want Governments to know that the EITI is not just for developing countries, but should be a truly global standard. The hon. Gentleman put the case very well. It means that we have a stronger argument to encourage emerging and developing countries to adopt similar rules.

The Under-Secretary of State for Business, Innovation and Skills, my hon. Friend the Member for East Dunbartonshire (Jo Swinson), who is the Minister for employment relations and consumer affairs, is the UK’s EITI champion. She has committed to implementing an effective and timely initiative for the UK. Unfortunately she could not be present to respond to the debate today, but across the Department for Business, Innovation and Skills we take an interest in ensuring that the initiative works properly.

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While the EITI shines a spotlight on domestic production, chapter 10 of the EU accounting directive requires listed and large extractive companies to report the payments they make to all Governments. We are committed to early implementation and are exploring whether we can put regulations in place in 2014, about a year ahead of the transposition deadline—not least because bribery and corruption are barriers to trade and growth, including in the extractives industry. They hinder development, distort competition and ultimately perpetuate poverty. Those problems can have a profound impact on developing economies, and the evidence is widespread. That is why the UK is a signatory to the UN convention against corruption and the OECD bribery convention. Under the Bribery Act 2010, which came into force in July 2011, a company that carries out business in the UK can be prosecuted for bribery anywhere in the world. Those companies can also trade on the honesty and integrity that the Bribery Act implies. It includes an innovative “failure to prevent” offence, and an “adequate procedures” defence to encourage companies to put in place measures to prevent people associated with them from bribing.

The Bribery Act is an important part of the agenda, but another barrier to growth is weak corporate governance. London is the world’s leading international financial centre, and a wide range of companies choose to list on our markets. That includes many extractive industries companies, whose operations are largely overseas. One of the reasons for that is our strong legal and regulatory framework, which includes corporate law and good corporate governance, giving shareholders clear rights on voting and information, and holding companies to account. That flexibility and confidence helps London as a listing location, and making sure that we keep that strength and confidence is important. We continue to enhance the listing rules to ensure that they are strong and well recognised internationally. The rights of independent shareholders in premium listed companies with controlling shareholders will be strengthened.

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There is new guidance on independence requirements for companies with a premium listing in some sectors, including mineral and extractive industries.

Ultimately, those and other measures that we are putting in place are there to ensure that we have a strong and well recognised system that has the right balance of transparency. As with the trust that is built up through the EITI, the trust and transparency within the UK corporate law and governance framework is vital to achieve long-term sustainable economic growth, including in extractives. I hope that the hon. Gentleman will agree with that.

We consulted on these issues during the summer, following the Prime Minister’s announcement in May that we were joining the EITI. We will publish our official response in early 2014. I am sure that the comments made by the hon. Gentleman today will be taken into account in that. Last month, the Prime Minister announced the outcome of an important part of the trust and transparency agenda. The Government obtained information on the individuals who really own and control UK companies. The hon. Gentleman referred to some of the difficulties that a non-transparent process can lead to. We will implement a central register of this information, which will be maintained by Companies House, and the register will be publicly accessible.

I hope that I have assured the hon. Gentleman that the Government take seriously the role of extractive industries, not least in promoting development in the fast-growing parts of the world, and that we strongly support greater transparency, an agenda on which the Prime Minister has led. It is important to grow economies and empower citizens, to encourage the development of strong and flexible corporate governance and to make sure that UK listed mining companies can lead the way. I am grateful to the hon. Gentleman—

3.4 pm

House adjourned without Question put (Standing Order No. 9(7)).