European Scrutiny Committee - Minutes of EvidenceHC 109-II

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Oral Evidence

Taken before the European Scrutiny Committee

on Thursday 4 July 2013

Members present:

Mr William Cash (Chair)

Mr James Clappison

Nia Griffith

Chris Heaton-Harris

Kelvin Hopkins

Jacob Rees-Mogg


Examination of Witnesses

Witnesses: Rt Hon Mr David Lidington MP, Minister for Europe, Owen Jenkins, Head of Western Balkans Department, and George Hodgson, Head of Parliamentary and Communications Department, Foreign and Commonwealth Office, gave evidence.

Q478Chair: Minister, I welcome you to the Thatcher Room. Thank you very much for coming in. We are going to start with the role of national parliaments and the purpose of scrutiny. Both you and the Foreign Secretary in recent speeches have referred to measures that could form a "bigger and more significant role for national parliaments" in the EU, which was envisaged in the Prime Minister’s Bloomberg speech and is also of great interest to those in COSAC. We have recently had a debate in Dublin about the whole question of democratic legitimacy. One of these is the so-called red card, as the Foreign Secretary put it, which considered giving "national parliaments the right to block legislation that need not be agreed at the European level". Could you tell us why you think the red card is necessary?

Mr Lidington: Our starting point is a political analysis of the extent of the democratic deficit and the rising levels of public discontent with the EU and its decision-making process that we see not just in the United Kingdom but in many different EU member countries. The Prime Minister and Foreign Secretary thought this was a subject that was clearly relevant to the debate about Europe here, but that also was important for the democratic health of the European Union as a whole. We decided that we wanted to try to shape a debate about the right instruments to try to remedy that lack of accountability.

There is a school of thought, strongly represented in the European Parliament and Brussels institutions, that holds that, while our analysis is accurate in some respects, the way to remedy that is to enhance further the powers of the European Parliament to take measures, for example by making the President of the Commission an office holder directly elected across Europe on the basis of candidates put forward by transnational political parties.

We disagree with that analysis. We think that the last four treaties have given extra powers to the European Parliament, and we do not believe the evidence suggests that has worked in adding to public confidence but that the opposite is true. It is this Government’s view that the right way forward is to find ways to strengthen the role of national parliaments in holding the EU decision-makers to account and providing additional checks and balances to place at the disposal of national parliaments. We have within the Lisbon treaty the yellow card procedure. The Foreign Secretary’s Königswinter speech, and mine to the WDR Europaforum in Berlin, suggested ways in which the Lisbon arrangements might be further strengthened.

Even before we get to the red card, there is a question about whether the yellow card procedure could be strengthened by looking again at the threshold and the scope of the yellow card process, which at the moment is limited to subsidiarity grounds but could be made wider to cover proportionality, disproportionate cost, the time given to national parliaments to put forward a Reasoned Opinion, or other grounds. But we thought it was right to bring forward the idea that we should go beyond the yellow card and propose an outright power of veto. If a given number of national parliaments around the EU said that a certain Commission proposal should be blocked, the Commission simply would not be able to review it and decide to resubmit but would have to take it off the table. It is not something the British Government have yet formally adopted as a policy, but it is an idea we have put out that we think needs serious consideration.

Q479Chair: Ultimately, in all the things you have described-the Barroso blueprint and various documentation-the pressures for more and more integration are clear. If you remember, Viviane Reding, who wrote an article in the Wall Street Journal and gave a speech via video to the Dublin conference of COSAC last week, called specifically for a federation. There is no question about the direction, which, in a nutshell, is political union. If we encapsulate the whole thing in the question of how the United Kingdom responds to the pressure being exerted for a political union, which is at the heart of a lot of that thinking, the movement towards a two-tier Europe and all those sorts of things, in that context it is very interesting to hear your comments on the notion of a veto. What would the right to block legislation mean in practice? Can you perhaps flesh that out?

Mr Lidington: My understanding is that this was an idea discussed during the convention on the abortive EU constitutional treaty a few years ago. Currently, if the Commission comes forward with a proposal, it is open to national parliaments to submit a Reasoned Opinion that results in the yellow card being triggered. In practice, if this scheme were brought into the treaties, exactly the same, or a similar process would apply, but with the power to require the Commission to remove that entire proposal from the table.

Q480Chair: The 1972 Act was based on the White Paper of 1971. What you have said in your opening remarks almost exactly mirrors the wording of that White Paper, which was that it was in our vital national interests to retain the veto, and that to do otherwise would endanger the very fabric of the European Community. I think I have got the wording right. You said just now that the context in which a veto took place would be to ensure that, where interests were vitally affected, there would be a case for exercising the veto.

Mr Lidington: I do not want to mislead the Committee. There is an argument to be had about the right of a Member State to exercise the veto. The truth is that, for reasons we know, successive treaty changes have enormously enlarged the scope of qualified majority voting rather than unanimity. I do not want to mislead the Committee on this point. The Foreign Secretary, the Prime Minister and I have been proposing not that a power of veto should be accorded to a single national parliament but a development of the process that is in the LisbonTreaty under which a given number of national parliaments around the EU can trigger, under current arrangements, a review by the Commission of a proposal they have submitted. We are suggesting that, as well as enhancing that power, we should give consideration to giving national parliaments above a certain threshold an outright power to block a Commission initiative. This is not just a UK idea. When I was meeting this Committee’s counterparts in Copenhagen, I found a great deal of interest in these ideas. When I floated the yellow card and red card ideas in Germany I had a pretty sympathetic response there as well, so in northern Europe in particular there is an appetite for serious conversation and engagement on these subjects.

Q481Chris Heaton-Harris: Just remind the Committee how many times the yellow card procedure has been used.

Mr Lidington: The yellow card has been deployed successfully only once so far on Monti II proposals.

Chris Heaton-Harris: In how long?

Mr Lidington: In not quite four years since Lisbon came into operation. Our case for enhancing those powers would be made stronger if we could show evidence that national parliaments were deploying the existing powers and finding them inadequate. The fact that the scope is limited to subsidiarity only is an unnecessary check on national parliamentary action. We pride ourselves in this country on the vigilance of our parliamentary system. If I look at the House of Commons and House of Lords together, there have been fewer Reasoned Opinions than the Swedish Parliament has put forward. It may be that we need to look at technical changes, for example to beef up COSAC. This is a matter for Parliament, not the Government, but perhaps we need to look at the parliamentary unit attached to UKREP. Are they sufficiently well resourced and staffed to keep an eye on everything that is happening in the Brussels machine? That might provide better communications and exchange of information so that parliaments can take a rapid decision about something. It may be that we in government need to look at how we can highlight subsidiarity concerns with greater clarity in Explanatory Memoranda. I am certainly open to all those ideas.

Q482Chris Heaton-Harris: That would be very useful. This Committee participated very much in the singular yellow card issued on those Monti II proposals. On the red card issue, I distinctly remember the conversation that was had at the time of the debate heading towards the defunct constitutional treaty. Member State parliamentarians were quite keen on the red card and European parliamentarians were not, because they believe that they are elected representatives, as they truly are, even though I know more people voted to evict Bubble from the second ever Big Brother house than voted for me in 1999 to get to the European Parliament. It is a democratically elected institution and they are saying, "We are the people who should be turning down these European Commission proposals." How do you get over that divide between two sets of people legitimately elected?

Mr Lidington: There is a role for the European Parliament written into the treaties. Whatever views Mr Heaton-Harris or I may have about whether it was wise to get to where we are today, that is where we are in treaty terms. In fairness, a large number of MEPs from all political families are committed, work incredibly hard and make themselves experts in their specialist areas of policy. But I do not think the evidence suggests that according the European Parliament additional powers, as the last three or four treaties have done, has added to public confidence. The Pew research surveys and Eurobarometer surveys show that trust in the EU and its institutions is now at an all-time low across the EU 27 or 28 as a whole. It is worse in terms of public confidence in France than in this country.

Q483Kelvin Hopkins: Isn’t the reality that the European Parliament is overwhelmingly a rubber stamp for what the Commission want? There might be some worthy individuals in some small parties who object, but by and large they go along with it?

Mr Lidington: I would not go that far. It is true that the centre of gravity in the European Parliament as an institution is to regard greater European integration, which the Chairman characterised as moves towards political union, as a self-evident good. The working culture of the European Parliament is to prefer integration.

It is the case that they alter proposals that have come from the Commission via the Council. Only yesterday, we had news that, on the proposals regarding UCITS salaries and bonuses, the European Parliament had rejected the pay cap proposals that had emerged from the Commission and Council proposals. Where we have noticed a change, even in the three and a bit years I have been doing this job, is that the Commission has become ever more willing to lean towards the Parliament and adjust its own proposals and approach to negotiations to try to make sure it gets the agreement of the Parliament. In my view, that has been done at the expense of the views of national governments represented in the Council. There has been an institutional shift. The memory of the fate of the Santer Commission sticks in the minds of today’s Commission, perhaps future ones too. They are always looking over their shoulder at the European Parliament and adjusting their position accordingly to make sure they lean towards them rather than the Council.

Q484Jacob Rees-Mogg: You said the treaty has given these powers to the European Parliament and essentially we are stuck with that, but I thought the Prime Minister’s position was that we would renegotiate the treaties. Are you saying that, in that renegotiation effort, prior to the promised referendum, the powers of the European Parliament would not and could not be part of it?

Mr Lidington: I am not saying there is any aspect of the treaty that at this stage should be ruled out of further consideration. The Prime Minister has always said that his ideas for European reform can in part be accomplished without getting to treaty change, but he believes that at some stage in the next few years-my consistent view is that the opportunity is between late 2014, when the new Commission and Parliament are in, and the end of 2016 ahead of a French presidential election in 2017-the treaties need to be reopened, and there is a dynamic within the eurozone that is likely to lead to the requirement for that to be addressed in any case. If the treaties are addressed, I would expect that some people in the European Parliament will come forward and say, "We want to have more powers now."

There will be other issues concerning the European Parliament, for example the age-old question of the shuttle between Brussels and Strasbourg. The requirement to sit in two places is written into the two treaties and can be altered only by looking again at those treaties. Therefore, the role of the Parliament is bound to be a subject for discussion whenever the treaties come to be opened. We are now as a British government trying to develop the debate to get ideas into circulation and see where we can get support for proposals that will enhance the role of national parliaments.

Q485Chair: To take you back to the Bloomberg speech, I and many others now regard the famous fourth principle as more important than all the rest of the speech put together. The Prime Minister says there is not a single European demos, and it is national parliaments that are and will remain the true source of real democratic legitimacy and accountability in the EU, and all the rest that he said in that speech. I put that on the record. Given that and what you have been saying, the question of democracy in the terms we have understood it in the evolution of our parliamentary system is at the heart of the Bloomberg speech. Therefore, the question Jacob Rees-Mogg has just raised about fundamental renegotiation goes to the heart of what you are saying as well with respect to the red card and the concerns being expressed all over Europe, as well as in the United Kingdom, about democratic legitimacy and accountability. Do you have any other ideas for strengthening the role of national parliaments?

Mr Lidington: The ideas we have put out in public at the moment are partly about quite technical ways in which we can strengthen the coordinating mechanisms. There are issues to do with how we can make the COSAC secretariat stronger and how scrutiny works at individual national level. As well as the red and yellow cards, other ideas are worthy of examination and could be embodied either in a working practice or treaty change, or both. You can adopt a new working practice ahead of cementing that in a treaty change. For example, one could give national parliaments individually the right to summon European Commissioners, or should COSAC have treaty power to do that? The Commission say, "We are always happy to come and talk to national parliaments if we are invited."

Q486Chair: Viviane Reding did not even come to the COSAC meeting. She did it by a blue-sky video.

Mr Lidington: This is not unknown even for Council meetings. In the case of President van Rompuy, he sometimes appeared on the screen when we met in Luxembourg and he was in Brussels.

Chair: But it is slightly William Blake.

Mr Lidington: Power to summon and question might be one thing. I have not developed my own thinking on this or tested it under public scrutiny, but the European Parliament has a right to propose an own initiative report that requires a formal Commission response. Very often, the Commission end up incorporating that into their programme of action. Should we have a system under which national parliaments, either individually or a certain group, have an equivalent right to produce an own initiative report that requires a Commission response?

Others are suggesting, mostly in the context of eurozone politics, but it could apply to the EU as a whole, that you have a second chamber of the European Parliament composed of national parliamentarians. That idea is out there. Knowing the constituency workloads of Members of the House of Commons, it is difficult to see how in practice that could work. Saying that it could be a role given to a reformed House of Lords probably takes me into dangerous political territory in a number of camps. I am administering the equivalent of an electric shock to Mr Rees-Mogg, but that idea is already out there. That is being discussed in the context of conversations within the eurozone among think-tanks and others about how to make more integrated fiscal and economic policy decisions democratically accountable at some sort of eurozone level.

Q487Chair: I am sure you would agree that the reason for the insistence on national parliaments, as the Prime Minister put it in the Bloomberg speech, is not because of an idea that has come out of nowhere; it is rooted in the fact that, at general elections, the electorate vote based upon promises and democratic values and traditions, and the voter makes a decision as to what he wants to do. Therefore, that is at the heart, is it not, of the reason we have to put such emphasis on national parliaments? It is general elections that decide the government of the day.

Mr Lidington: Yes, with two additions to what you said. First, as far as I can see, at European parliamentary elections, most voters around the EU vote on national grounds- whether or not they want to administer a kick to their national governments. Secondly, while rightly this Committee focuses on the role of national parliaments, let’s not forget either the importance of asserting the role of the European Council, which is the voice of democratically elected and accountable national governments.

Q488Chair: But the consequence of qualified majority voting in that Council also can conflict with the decisions taken in national parliaments. That is another thought you have at the back of your mind, surely.

Mr Lidington: It can do. QMV in terms of the policy substance sometimes works to our disadvantage and sometimes to our advantage. It would be quite wrong to think that it is always the UK that is trying to block a proposal. There have been proposals to liberalise the market where we have been among those urging European action, and protectionist partners have tried to resist that. That is why the Thatcher Government, in the days you will remember, accepted QMV for single market legislation.

Chair: You will remember that I also tabled an amendment that nothing in the Act shall derogate from the sovereignty of the United Kingdom Parliament.

Mr Lidington: Yes.

Q489Mr Clappison: I welcome what you have said so far in your approach and the admissions you have made about the democratic deficit. However, can I urge a word of caution? In your last answer, you talked about reopening the treaties and the dynamic within the eurozone countries, and countries that are to become part of the eurozone, about changing the arrangements for that. Unless you can contradict me, every treaty change we have seen in the European Parliament has worsened the democratic deficit. Any future treaty change will be against the background of actual or potential eurozone countries coming together to settle things for the benefit of the eurozone. We who do not want to be part of the eurozone will be tagging along with this and are likely to be caught in its slipstream.

Mr Lidington: While that risk is there, and certainly there will be a wish by colleagues in the eurozone to have arrangements that make it possible for them to stabilise their currency union, to which they are committed, there is not evidence in anything I see that they are choosing to act as a caucus against the interests of non-euro members. I do not see Dutch and Greek Ministers taking the same side on many issues at the Council.

Q490Mr Clappison: They have a common interest in what happens in the eurozone. Correct me if I am wrong-you will know about this, especially as Europe Minister-but the debate going on is that the northern European countries want more say over what happens in the southern European countries because they do not want to have to pay for them, and that is likely to produce more centralisation and federalisation.

Mr Lidington: In the eurozone, we are seeing a tension between an economic logic that points towards fiscal and economic integration of a more intensive kind to complement common monetary policy and interest rates and, on the other hand, the political dynamic in the different countries. To simplify it, the northern eurozone countries say that if their electorates and taxpayers are to underwrite the liabilities of others, there should be rules and they should have a say in how those other countries run their economies, and there is resentment against foreign interference on the streets and in the capitals of some of the southern eurozone countries.

Mr Clappison: As we have seen in Portugal today, which is surprising.

Mr Lidington: That is the reality. Our eurozone colleagues have to wrestle with those tensions and try to find a way forward, but at the moment I do not detect any kind of push to say we will ignore the interests of the United Kingdom, Poland, Sweden or Denmark or the others outside the euro, and think only of the eurozone. We each guard against that risk. Mr Clappison is right about that. We talk constantly to other partners who are outside the euro, as well as to those inside it, about the need to have arrangements that are fair to everybody. For example, in the recent Dutch Government review of subsidiarity, we have seen recognition of the issues we often discuss here in Parliament. There is a readiness to engage in this debate in euro-ins and euro-outs alike.

Q491Chris Heaton-Harris: I have one point for the Minister about the European Parliament, which I know he knows a bit about. When I was elected there in 1999 a very elderly German CSU member took me to one side and asked me why I was there, which was a fairly good question at the time because I did not know. He said, "The reason I ask is that, if you believe in democracy being exerted at Member State level, you should go to your Member State’s parliament. The European Parliament is for people who believe in democracy being enacted at European level." There is always going to be that dynamic. I have a range of questions. I went along to a session at the Foreign Office with a range of opinions. I cannot remember what it was called, Mr Hodgson, but it had a very nice headline. Essentially, it was a group of us talking to Foreign Office officials, with a range of opinion on how European integration should go. One thing we all agreed on when we left was that first reading agreements were a very bad thing for democracy because everything is done so quickly, and it causes some issues for national parliaments in their remit of scrutiny. These things go very quickly and lots of deals are done behind the scenes. Something that appears impenetrable suddenly becomes a decision that is completely done and dusted without what I see as due process. In the last three years of my time at the European Parliament, I voted against every single one of them, even though some seemed to be relatively good for the UK. It was just that the process was unbelievably flawed. How do you see the increasing significance of trialogue negotiations and first reading deals, and the challenges they present to scrutiny committees across Europe, and how can we deal with them?

Mr Lidington: I completely acknowledge Mr Heaton-Harris’s point. These difficulties are not confined to scrutiny committees. If I think back to the recent final stages of the negotiations on the multi-annual financial framework, the Irish presidency, having consulted the General Affairs Council through COREPER and bilaterally, went to the Parliament and had discussions, and we as the Council representing national governments had to wait for the Irish to come back and say, "These are the changes that we think will induce the Parliament to give its consent to the MFF package overall." Those conversations take place without all 27 being in the room. I suspect there is no perfect way in which to deal with this, given the current treaty arrangements. I would certainly be willing to look with an open mind at any proposals that come out in this Committee’s report. What is important in the UK is that Departments take seriously their duty to keep the scrutiny committees updated at key points in negotiations.

This does raise a question, which may come up later in our session this morning, about the balance to be struck in how scrutiny Committees handle things between the Committees’ wish, rightly, to be transparent and open with the public about what they are doing and the questions they are putting to Ministers and officials, and the requirements of government when a negotiation is still ongoing not to go public with a full negotiating hand describing fall-back positions, red lines and so on in a way that could make it more difficult for us to achieve our negotiating objectives.

Q492Chris Heaton-Harris: I completely understand that. When I first heard I was going on to this Committee I wrote to the Chairman to say, "Shouldn’t we meet in public?" but we do not. Therefore, that really does not apply to this Committee in this Member State Parliament. Sir Jon Cunliffe told us that the Government should aim to ensure that the Committee is updated in what we think will happen in the trialogue process. The Committee would quite like to know how this should be done with documents that have already cleared scrutiny and we have given you some cover, as it were, going forward.

Mr Lidington: Normally, it could be done by sending officials to have an informal briefing. This is something we do regularly with the European Union Committee in the Lords. It could be done by way of letter. It is sometimes easier for officials to be more open with the Committee in a private oral session than on paper, because, quite properly, the paper is going to be made public. If the Committee feels that either in government generally or in particular Departments the responsibility to keep the Committee up to speed is not being given sufficient weight, I am very happy to take that away, look at it and discuss it with ministerial colleagues. There is also the question: which of the multifarious negotiations going on at any one time does the Committee want to spend time pursuing in detail in this way?

Q493Chris Heaton-Harris: There are themes where the Committee has more interest, which you can almost guess from the letters that you will be receiving, but there is an opportunity that I guess just complicates bureaucracy: should we make more use of the deposit of new versions of documents or Supplementary Explanatory Memoranda to reimpose the scrutiny reserve?

Mr Lidington: It depends a bit on the category of documents, because when drafts are being circulated, they are not normally covered by the scrutiny resolution. George Hodgson is from our EU department. Am I right that the drafts that come out of a trialogue are not covered by the scrutiny resolution?

George Hodgson: No, just the formal documents that come out of it.

Mr Lidington: It is the formal document after there has been a Council decision on something. At that point, scrutiny is triggered and you get an EM, which is public. The Committee reports on the Explanatory Memorandum and that report is public, even if the Committee’s deliberative session is in private. My starting point would be that we might be able to talk about discussing privately with the Committee the content of some of the drafts and suggested negotiated changes, but I would be very reluctant to have a public discussion about that when negotiations are live and often fast moving.

Q494Chris Heaton-Harris: Do you agree with the evidence of Professor Hix to this Committee that the Council is a secretive organisation that should act far more transparently when it is legislating in nonCFSP matters, which is echoed by calls from the European Parliament in budget negotiations with the Council almost every year?

Mr Lidington: There was a time when I would have agreed with Professor Hix completely. The problem with the approach he suggests is that you would see a further development of what is already happening in the Council, which is that, when the cameras are switched on, people are more guarded in their language. If we want to speak very bluntly to the Commission, or other Member States, that waits until lunch or dinner with Ministers and the Commission alone, and then we let rip.

Chair: Of course, you might be overheard.

Mr Lidington: I had better not get drawn into that. There has to be a space within which Ministers, or COREPER officials serving on the Council, can talk confidentially, without negotiations being conducted through the media.

Q495Chris Heaton-Harris: How can our scrutiny of developments in closed negotiations be improved? Could it be facilitated by our access to UK Government non-papers? How do you define non-papers?

Mr Lidington: Non-paper tends to be whatever a Department wants to define it as. It is just a way of floating ideas on a non-attributable basis. I suppose it is the nearest thing to applying off-the-record or Chatham House rules.

Q496Chris Heaton-Harris: So, it is like a Twitter troll in a Government Department.

Mr Lidington: It is a way of starting a discussion and putting forward policy ideas without suggesting that you are completely bound to those but signalling that you are open-minded to constructive criticism and contrary ideas. It is starting a debate; in Westminster terms it is a preGreen Paper stage. When it comes to closed negotiations what I have found works with the House of Lords Select Committee is the occasional briefing by officials in private session when there has been a particular concern of the Committee. We are quite happy to tell the Committee quite a bit about what has been going on, but we have not felt able to make that public.

As to non-papers, precisely because they are informal, they are not depositable and caught by the scrutiny resolution. While we would not refer to a non-paper in a letter to the Committee, we might make reference to ideas that might be included in it, but I think an oral briefing would be the best way forward.

Q497Chris Heaton-Harris: The Government have agreed to supply us with limité documents on request. Would you agree to the introduction of a system whereby we, as the Scrutiny Committee, could receive a formal listing of these documents issued each month so we know what we could ask for? Should these documents related to proposals still under scrutiny be made available to the Committee automatically?

Mr Lidington: I will have a look at the first proposal about a regular list and see if that is something we can do without it breaching our obligation as a Government not to go beyond the confidence of EU Council discussions.

Q498Chair: You may remember that I had to put down an urgent question relating to a very important issue regarding the EFSM, the European financial stability mechanism. It came to me because I was given a copy at a COSAC meeting of a limité document that had an extremely strong bearing on our relationship with the EU, bailouts and all the rest of it. The Speaker thought it so important that he gave an urgent question on it. As to questions of confidentiality-thinking about our Standing Orders and all the other constitutional aspects of our responsibility to the House and the electorate-if a matter is deemed to be limité because it suits the Council, it does not alter the fact that our first duty is not only to the House of Commons but the electorate as a whole. I am sure you would find that understandable.

Mr Lidington: There is an inherent tension here. I absolutely understand what you are saying. My understanding is that, where other national parliaments around the EU are given access to limité documents, it is done on an informal basis and those documents are not subject to the formal scrutiny process. It might be an element in a mandate system of parliamentary scrutiny that also includes a private discussion between the Minister and the Committee, at the end of which the latter approves the scope of the negotiating mandate that the Minister then takes forward. If we were to consider making limité documents routinely available to the Committees, I am not opposed to that as a matter of principle. However, I would be opposed to that if it were routine for those documents to become public. It is for the Committee to decide what to recommend to the House, but the Committee could propose amendments to the Standing Order to enable the scrutiny of certain documents to happen without the content being made public. The Committee could consider making reports on documents without making public administrative limité content that the Government had shared with the Committee to help it come to a more informed opinion on a particular negotiation. In effect, a sanitised report would be going into the public domain. Those would be ways of addressing this. It is for the Committee to decide whether that goes too far away from the principle of transparency, to which you rightly accord importance.

Q499Chair: Surely, you would appreciate that the limité process, as in relation to confidentiality in the more general field of law across all kinds of commercial activities and the rest of it, can be used, as with the attempts to close down discussion over the health service, which we have seen recently. The principle is that using this kind of confidentiality tag of limité could be seen as a cover for ensuring that nobody really knows what is going on until the decisions are taken, although they have enormous national significance. On priorities, if, for example, as Chairman I was sent a copy of something, no doubt my legal adviser would tell me, "That is bound by confidentiality, and that is the way those rules have been constructed," but I may take the view that, in terms of our Standing Orders, I have less regard for the fact that people want to keep it quiet than for the fact it ought to be made public because it affects the House of Commons, the scrutiny process and the electorate as a whole. I am sure you would appreciate that is where the buck stops, which is basically with me or the Committee.

Mr Lidington: It is important that the UK as a member state government continues to be able to discuss matters under negotiation in confidence with its partners and the European Commission. Other governments will share that approach.

Chair: You say "governments".

Mr Lidington: I am speaking on behalf of the Government in saying this. You are right to say that any classification of a document, whether at national or European level, is a power capable of being abused in order to treat as confidential things that, frankly, ought not to be, but that is a different question from the argument about whether or not such a power to designate ought to exist at all. So long as the limité category exists, we have a duty as the United Kingdom Government to abide by our obligation to protect documents that are for Council-only circulation, but we are content to carry on sharing limité documents with the Committee if that is in confidence.

Q500Chris Heaton-Harris: Does the Foreign Office, therefore, see the limité document as a useful tool, or something it would prefer to get rid of in the name of openness and transparency?

Mr Lidington: We will need a classification that enables draft texts that reflect the outcome of verbal negotiations to be circulated and discussed in confidence. For example, some of the text of draft proposals that come forward on, let’s say, various trade or foreign policy matters or agreements need lawyers to crawl over it to check exactly what it is. Does this draft accurately reflect what we thought had been agreed in a particular conversation? Does it reflect our interest satisfactorily?

Q501Mr Clappison: In all this who decides what should be limité?

Mr Lidington: I think it is the Council secretariat that does it.

Mr Clappison: It is done by officials and then we rubber-stamp what they decide?

Mr Lidington: I will write to set that out more clearly, but I think it is the Council secretariat. It is a matter of established practice.

Q502Chair: In the context of the urgent question that I got, it was perfectly clear that the reason for the limité was to suit the convenience of the Council in relation to the release of information regarding bailouts. It was nothing to do with drafting or redrafting. It was quite clear on the face of the document that they had made a decision that they did not want the rest of the European Union or, for that matter, the national Parliament to know about.

Mr Lidington: In that particular case, some of the detail was market-sensitive information but, in the case of any negotiation, once it gets beyond the stage of arguments about drafts, we are into a Council decision. In the case of most categories of legislation, that is caught by the resolution.

Q503Mr Clappison: Surely, the general principle of freedom of information as we observe it in this country is that you are entitled to know everything, not just what officials and secretariats think you should know.

Mr Lidington: The Freedom of Information Act bites upon United Kingdom public authorities, not EU institutions.

Q504Mr Clappison: If we are to request these documents, how do we know what is in them that might be interesting, and whether they exist at all?

Mr Lidington: The Committee will be aware that a negotiation is going on about a particular subject. If the Committee wants to know more about the progress of negotiations, normally I would be happy to send my officials along.

Q505Mr Clappison: What if there was something in them of interest to us but we did not know anything about it and so did not know of its existence?

Mr Lidington: The trouble is that we are getting almost into Rumsfeld territory of unknown unknowns.

Chair: There are a lot of unknowns, and in a moment we will be coming to the matter I raised with the Prime Minister about the negotiating mandate on European free trade agreements.

Q506Jacob Rees-Mogg: I want to pursue Mr Heaton-Harris’s question about first reading deals. It seems to me that, on limité, a first reading deal can be done to create a law that has been done entirely in secret. That seems to me so wholly unconstitutional and improper that the Government ought never to be party to it.

Mr Lidington: They will know. It will not have been done entirely in secret. The Council’s decision that agrees the Council’s position that subsequently goes to the European Parliament first takes place on camera in Brussels. The president of the Council says, "The cameras are being switched on and we are now in formal legislative session"; similarly with debates on a measure that take place within the European Parliament.

Q507Jacob Rees-Mogg: But it has been agreed at that Council stage. Before the cameras are switched on, it has been agreed that this is going to be the new law.

Mr Lidington: Yes, but in the same way that a discussion in Whitehall between different Government Departments about a proposal takes place notionally away from the media and, when the Government collectively have taken a view, it comes out into the open.

Q508Chris Heaton-Harris: It comes to Parliament where we have three readings and it goes between Commons and Lords. In European institutions, you can have a Council meeting that does this literally on one day, and the Parliament waits for the first reading deal, because it wants to get the deal done-there are not many plenaries at the moment-in plenary session the following week. It can be done in seven days.

Mr Lidington: The problem with the implication behind what Mr Rees-Mogg and Mr  HeatonHarris are saying is that, if one simply brought the cameras into the meeting between the rotating presidency and the European Parliament’s negotiators, let’s say, in that trialogue, you would end up having a separate informal meeting where there would be frank conversations, and it would be a rather stilted pro forma meeting to meet the requirements of openness.

Q509Jacob Rees-Mogg: To understand these first reading deals better, at the point at which it is agreed by the Council, there have already been negotiations with the European Parliament so that it is known it will get through at European Parliament level?

Mr Lidington: No. The Commission will make a proposal. That is discussed by the Council, initially by officials. There is usually a great deal of informal conversation, through UKREP on our part, and it will go to COREPER. It will come to the appropriate sectoral ministerial council meeting. The ministerial level meeting may debate it in some detail and send it back, though on the multi-annual financial framework, a whole number of different meetings were devoted to this. On other occasions, we meet as Ministers and a deal has been done by officials with the approval of the relevant departmental Ministers in national capitals, and it has been quite easy to agree a compromise text. The Council takes a formal decision. That is subject to scrutiny at that point. It is caught by the resolution. We send an explanatory memorandum to this Committee. The proposal then goes off to the European Parliament, but the presidency engages in negotiations with the Parliament to see what their views are. The Parliament has its own process at its end.

Q510Jacob Rees-Mogg: For there to be a first reading deal, has it already been squared with the Parliament before the Council makes this announcement?

Chris Heaton-Harris: The Council is very much aware of the Parliament’s position.

Mr Lidington: It is informal awareness, yes. The Parliament will be aware of what is being discussed at Council and what has come out of the Commission. Those MEPs who have committee or rapporteur responsibilities will have signalled if they are unhappy with particular aspects of a proposal, so we will have a pretty good idea of where the areas of controversy are likely to be.

Q511Chris Heaton-Harris: Could we have a note about the last three first reading deals and the timetable they ran to? It would be quite interesting just to demonstrate the speed of the process and what sort of deals they are. I have a final question, about streamlining the explanatory memorandum process. Do you have any specific suggestions for the types of proposals that could be subject to shorter EMs?

Mr Lidington: I will provide a letter on the first reading deals on trialogue. Obviously, we will have to talk to whichever Departments were the lead on those dossiers to make sure we have got it accurate before we write to the Committee.

I will flag one point before I come to streamlining. I said there is a lot of early engagement-informal conversation-before we get a Council decision, let alone before it goes to Parliament for the trialogue. It is worth Westminster thinking about whether it is engaged at the Brussels end of the process sufficiently early. If you look at how the Germans do this, the Bundestag and Bundesrat have about 18 people representing them in Brussels; the two Houses at Westminster have three. There is a genuine question for this Committee and the Lords Committee about whether more needs to be done there.

It is worth stressing again that explanatory memoranda are produced first on the original Commission draft and then the Committee is updated during negotiations, usually by letter from the relevant Minister. Ministers agree to the formal legislative decision at the Council if it has cleared scrutiny, subject to the rules on overrides that are invoked if the Government consider that to be necessary, but normally the Minister will agree only if something has cleared scrutiny and it has gone through the process here.

Streamlining needs to be looked at in the light not just of the Committee’s current business but also those questions the Committee has raised in the past about action plans, which you may wish to come to, Chair, and also implementing and delegated legislation. In the case of all those categories, there are some things that may well be politically significant; there are others that, frankly, are technical and pretty routine, which I do not think the Committee would want to waste much time considering.

An awful lot of paper flows backwards and forwards. It imposes a huge workload on the Committee, and the Committee deals with it diligently. If we look at how the Danes do this, they have a mandate rather than a document-driven system. My understanding is that they look at about 75 mandates in the course of a parliamentary year. There is a vast area that the Danish Parliament decides is not a high enough priority area for them to get the Minister in and discuss the mandate in detail. If we are applying greater selectivity to a document-based system, I look at CFSP and CSDP measures. For example, we have a decision to establish a new CSDP mission, and a month or six weeks later there is an implementing decision to give effect to the decision in principle that has already been made. At the moment we have to send a separate explanatory memorandum on each of those decisions. My personal view is that, frankly, one ought to be enough, and it would save the time of both the Committee and my officials if we could dispense with the second of those and just rely on the first to provide scrutiny. That is one example-other Departments may have others.

Q512Chair: I am conscious of the time factor. Could you give us an indication as to when you need to move on?

Mr Lidington: I am okay at the moment.

Chair: This is a very important moment in our inquiry. We are taking the opportunity to look at the context of a lot of the evidence we have received, so we are very grateful to you.

Q513Kelvin Hopkins: I raise a subject that I have raised several times before. The great majority of the evidence we have received recommends returning to permanent membership of European Committees because the current system of ad hoc Committees is not working. As you told us in 2011, "There is no doubt that under that system, with genuine Standing Committees, Members were able to acquire a working knowledge or expertise in a particular area of European policy." Are the Government still set against permanent memberships, and, if so, why?

Mr Lidington: I have said to the Committee before that, in my first Parliament, I sat on one of those permanent Standing Committees for several years. The reason there is scepticism on the Government’s side, particularly among business managers, is that the old system started to fray because Members of Parliament were very unwilling to serve on those Committees. It was increasingly difficult to get MPs to show up, put in the time and do the work. I absolutely see the advantages of the approach Mr Hopkins suggests, but, for it to work, it requires a sufficient number of parliamentary colleagues who are prepared to devote quite a lot of their time to becoming experts on those areas of EU-level policy. In the past we found it really difficult to get people to do that. People do not always want to come on to the Committees under current arrangements, but if they feel they have that duty every now and then, it becomes easier to secure attendance than under the old system. That is the reason for the scepticism; it is simply about practicalities.

Q514Chair: Surely, if you look at Bloomberg and the whole change in the nature of the interest that is being taken in the European issue on all sides of the House, the focus is such that more people would be better equipped if they had more expert knowledge as a result of being there so they could ask the right questions, whereas quite often all of us who have been on these Standing Committees would agree that the whips expect people to sit there and accept the discussions, although one or two people will ask the right questions. In terms of giving the public and the media a greater understanding of what the issues are, a person could become expert as you have, partly because of your being on the Committee and partly, I suspect, because you were a special adviser to Douglas Hurd back in the 1990s. You have acquired extraordinary expertise in these matters, but there are many other Members of Parliament who will perhaps find it relevant to the current debate about our relationship with the European Union.

Mr Lidington: I am very much in favour of many more Members of Parliament coming to regard an understanding of EU processes, institutions and policymaking as an integral part of doing domestic legislation. It is wrong to think of the EU policymaking process now as something in a separate annex. We have to regard it as mainstream. Membership of Standing Committees may be one way of addressing this. I continue to believe that departmental Select Committees should be prepared to do more early engagement on the basis of their duties, which, as you have said to me before, Chairman, are set out under Standing Orders at the moment. The Justice Select Committee did do some good work on data protection and European legislative initiatives in the latter part of last year, but not every Select Committee has that degree of enthusiasm.

Q515Kelvin Hopkins: One of the problems that arises is not just lack of knowledge of or interest in European issues being debated but the procedures. Members come along and are unaware of how the Committees are supposed to operate. Sometimes even shadow Ministers and chair and panel members are not absolutely certain how they should operate. When they were permanent, everybody knew how they worked. All sorts of problems arise from the ad hoc approach. Do the Government have any alternative suggestions to make that would improve the current system?

Mr Lidington: We would be keen to see the departmental Select Committees take on more early engagement and scrutiny, with a small "s", of European decisions. We have very much been waiting for this Committee’s report to focus minds and test the water in Parliament to see whether there is an appetite going beyond those who already take a keen interest in EU matters for the types of reforms we are now discussing.

Q516Chair: The point you have just made with respect to whether or not people take an interest is extremely important. You cannot tell whether you should take an interest unless you know enough about the relevance of what is being decided at European level and its impact on domestic legislation. By the look of it, the general public have now formed an opinion that they regard this as a matter, complemented by the Prime Minister’s proposal for a referendum, where it would be extremely important for Members of Parliament to have the opportunity to know more and relate it, as Kelvin said, to the goings on in the Committee itself. Do you think we are getting close to being on the same page on this?

Mr Lidington: We have very much the same objectives. If the Committee reports in favour of permanent membership of Standing Committees, and there is clear support for that in the House, the Government will want to reflect on that very carefully.

Q517Mr Clappison: Much of the evidence we have received states that the earlier the scrutiny, the more influential it is. You have said this yourself. If that is right, when ideally do you think European Committee debate should take place?

Mr Lidington: It starts before the formal scrutiny process. Parliamentary engagement needs to start when we have Green Papers, White Papers, Commission work programmes, or even earlier; it is when ideas are being kicked around. That was why I said earlier that I thought Parliament might want to reflect on the strength of its representation in Brussels, and it would be right for departmental Select Committees to do some forward thinking about how EU-level initiatives might influence the areas of policy that they are responsible for covering.

As to formal debates on scrutiny, I have consistently taken the view that they need to be done as early as possible. The dilemma that business managers always face is that there are a limited number of parliamentary hours in the week, and there is a lot of competition for time, particularly on the floor of the House. I have always taken the view that, in principle, the sooner the better.

Q518Mr Clappison: Can I raise a very recent example of this that has arisen on which perhaps you would give us your views: the Tobacco Products Directive? You may be aware that that is a very important revision of a directive setting out a whole new series of requirements for tobacco products. It is controversial and people wish to have their say. As soon as it found out about it, this Committee told the Minister dealing with it that it was interested in it and held it under scrutiny reserve. I believe the Minister has just agreed a general approach before there was any opportunity for Parliament to debate it, never mind how many people were employed by this Committee, Parliament or Brussels, or what Select Committees felt. How effective do you think parliamentary scrutiny has been in that case?

Mr Lidington: From what Mr Clappison says, it certainly sounds like a question that needs to be answered.

Mr Clappison: I think that is a fair summary of what happened.

Mr Lidington: From memory, the Tobacco Products Directive is a Department of Health responsibility. The best I can say this morning is that I will take note of what Mr Clappison has said on that specific example; I will consult my colleagues in the Department of Health, and either they or I will write to you, Chairman, and Mr Clappison to set out what happened there.

Q519Mr Clappison: That is very helpful. Should the option of European Committees also considering delegated legislation resulting from EU commitments, thereby tying up both ends of the legislative process in a single set of Committees, be considered?

Mr Lidington: This is where we come back to streamlining. There are about 1,700 items of implementing and delegated legislation every year. I do not think that the Government want to have to write 1,700 further explanatory memoranda, and I suspect the Committee would not welcome having to read another 1,700 explanatory memoranda. Some Departments have tried to pick out those implementing and delegated Acts that the Government believe are politically sensitive or important, and flag them up to the Committees. Sometimes the Government have deposited politically significant proposals. It is not done systematically.

Scrutiny Committees both here and in the Lords have suggested ways forward, for example having in normal explanatory memoranda a separate subheading that highlights whether provision is made for delegated or implementing Acts, and, if so, for what areas of that particular directive or regulation; and also some sort of codified rule under which proposals for delegated and implementing Acts that are either legally or political sensitive should be deposited.

I come back to streamlining. I would be very willing to take those ideas forward and try to get government to agree to those, but we would need to try to find a way of doing that without simply adding to the amount of paper already moving to and fro, and therefore in tandem we should look at areas where at present matters are subject to the scrutiny resolution and require an explanatory memorandum but are not of huge political significance, and perhaps duplicate other matters.

Q520Chair: In this context we have much more in mind statutory instruments that emerge, for example, from section 3 of the European Communities Act 1972. That is the implementation, by way of statutory instrument, of legislation that emanates from a treaty obligation. To rephrase the question in that context, should the option of European Committees also consider delegated legislation resulting from EU commitments? When I was on the Delegated Legislation Committee way back in the early 1980s, we had a system whereby all statutory instruments had a little mark against them saying it emanated from European legislation. That was agreed to by the Chairman of that Committee, the late Bob Cryer. It has since been discontinued. For practical purposes, when the Delegated Legislation Committees are looking at the legislation, they do not know whether or not it derives from the European Communities Act. That is the context in which we are asking about the European Committees, because the implementation of the European Communities legislation through a statutory instrument can be extremely important under section 3. That is the framework I would like you to reply to now.

Mr Lidington: I have not considered the question in that way before.

Chair: That is interesting.

Mr Lidington: The way in which EU obligations are implemented in this country is, in Whitehall terms, very much a matter for the particular Department concerned. Sometimes they might bring forward an SI that includes an element that is about implementing EU obligations but also an element that reflects something the Government want to do in any case. I just wonder whether to put all such SIs through the European Committee process is trying to force too much through a pipeline of finite diameter.

Q521Chair: Is this the eye of the needle and all that? Just now Chris Heaton-Harris was asking, quite properly, about the extent to which in the Westminster parliamentary process we pass Acts of Parliament imposing obligations on voters and citizens. Two Houses of Parliament take an Act of Parliament through three stages, with amendments and all the rest of it, and yet, as I have often said in the past, when you look at a piece of European legislation, it can contain every bit as much as would be in an Act of Parliament going through two Houses and it goes through without anything remotely like the same kind of consideration. That is the framework in which this might be looked at.

Mr Lidington: That is probably taking us into a debate about the scope of statutory instruments and possible reforms to the parliamentary procedure governing statutory instruments that is beyond my areas of ministerial responsibility. The point about there having been previously some sort of flag in the process is an interesting one. I have no idea when or why that was discontinued.

Chair: Could you write to us on that point? It would be helpful.

Mr Lidington: I will write to you on that point.

Q522Chair: As part of the inquiry, the Committee is considering what happens when it recommends debates on the floor of the House. Can you explain how it took getting on for five months for the debate on the Commission’s blueprint for deep and genuine economic and monetary union and the financial transaction tax proposal to take place? As you know, I did have discussions with the Financial Secretary about this. I do not believe I am going beyond private conversations if I say that, on the question of primacy, it was the Foreign Office that took a position that effectively was not quite the same, to say the least, as that the Treasury Minister himself took. We ended up having a very good debate. Although there was a division over the question of the financial transaction tax, there was no division on the fundamental question of primacy, which is hugely important to the United Kingdom Parliament. Why did we have to wait five months in effect when we recommended a debate on the floor of the House? We asked for three hours and ended up with one and a half hours jammed into an afternoon with three other issues. Right at the heart of everything you have been so helpfully discussing with us today about national parliaments and the Bloomberg speech, we have to wait a whole five months to have that debated on the floor of the House. Can you explain a little further, because you are the Foreign Office Minister responsible for this, how this came about?

Mr Lidington: As you know, this is a matter for which Treasury Ministers are responsible. You have been in correspondence both with them and the Prime Minister over a period of months about this. If you want to pursue this further, it is really a matter that you have to explore with the Treasury. I do not want to breach confidence in any way. It is probably fair to say that the view of Treasury Ministers was that the initial reports from President van Rompuy and the other presidents were interim reports, and that the appropriate stage for a debate on these matters would have been when there were final reports that indicated a definitive set of proposals on the way forward.

Q523Chair: But there is nothing definitive about the question of primacy; it is a fundamental principle that lies at the heart of everything we are doing in the House of Commons in scrutiny, and also at the heart of the fourth principle of the Bloomberg speech.

Mr Lidington: The Treasury considered it important to wait for further documents from Brussels on EMU so they could be debated along with those early interim reports. The documents they expected to be published were delayed, and that contributed to the delay in the debate. The fact is that at the moment we have a document-based rather than mandate-based system, and that is what drives the process. If the Committee wants to go into further detail on this, I ask that it takes it up with Treasury Ministers.

Q524Chair: I can see that it is somewhat uncomfortable, but I am going to pursue it, because you are really saying that the delay had nothing to do with the Foreign Office, are you not?

Mr Lidington: The way in which scrutiny works on the Government side is that every proposal that is subject to scrutiny is the responsibility of a particular Government Department. It is for that Government Department to submit an explanatory memorandum to the Committee. It is then for the Government business managers, in consultation with the lead Department, to discuss a response to the Committee’s reference for a debate either in Committee or on the floor of the House. The Foreign Office does not have any kind of executive role over how EMs from other Departments are drafted. We have the responsibility, as we do this morning, to be accountable to Parliament for the overall exercise of EU policy and, where there are legitimate criticisms or suggestions for reform, to go back to other colleagues within the Government to try to lead the discussion about what the collective Government response should be.

Q525Chair: I understand the process, but the question is this: this was an issue of primacy. This question lies at the heart of the scrutiny process and the status and role of the United Kingdom Parliament and our Standing Orders. We recommended that there should be a floor debate and it should be for three hours. We waited five months and were subjected ultimately to it being squeezed in with other matters, including three other debates for one and a half hours on the same day. It is simply not good enough.

Mr Lidington: I hear what you say, Chairman.

Chair: But is there an apology to go with it?

Mr Lidington: This is something you will need to discuss with Ministers at the Treasury.

Q526Chair: Could the format of debates in European Committee, which is basically an explanatory statement by a member of the European Scrutiny Committee and then a statement by the Minister followed by a debate, be followed for debates on certain European documents on the floor of the House, allowing perhaps up to half an hour for the statements and up to an hour for the debate?

Mr Lidington: To be clear, you are proposing this in terms of debates on the floor of the House?

Chair: Yes.

Mr Lidington: I can see the case for doing that. It would mean more time being used than at present. I do not want to give a firm view this morning. It sounds to me like the sort of thing, if the Committee includes it in its report, I would look at with an open mind and take to colleagues and discuss with them.

Q527Chair: That is very helpful. Are you in favour of reinstating preEuropean Council debates on the floor of the House?

Mr Lidington: If the Backbench Business Committee recommends them, Ministers will happily attend and take part, but these were explicitly among those debates that, under the Wright Committee proposals, were assigned to the Backbench Business Committee.

Q528Chair: We have received evidence that pre-Council scrutiny in the House is particularly weak, amounting simply to a written statement by the relevant Minister. Do you agree?

Mr Lidington: I do not agree with that. If there are complaints about the quality of particular written ministerial statements ahead of Councils, I would be happy to look at proposals as to how one can improve those. Quite often, we get the final agenda only relatively late in the day. Those sectoral councils that consider legislative proposals-you will appreciate that the Foreign Affairs and General Affairs Councils tend to spend most of their time on policy discussions rather than specific legislative items-sometimes will not know, even until the day before Ministers meet, whether or not COREPER and other official discussions have narrowed down areas of disagreement, or even secured broad agreement between national governments, so it is quite difficult to be precise a long distance in advance.

Q529Chair: Many other national parliaments rely on preCouncil hearings with Ministers as a more effective method of scrutiny of Council meetings. Do you agree that a pre-Council hearing with the relevant Select Committee would strengthen Parliament’s scrutiny?

Mr Lidington: It could work. It would mean a profound difference in how we did scrutiny. There is certainly a case for departing from the document-based system we have now and moving instead towards one based more on the Scandinavian model, where you work on the basis of a mandate. As you will know better than anyone, the precise powers and scope of Committees under the mandate system vary, depending on whether you are looking at Denmark, Sweden, the Netherlands or Finland. The approach has to be one or the other. I do not think it would be feasible to have both the current document-driven system and a mandate system in addition. There would be a question about how priorities were set. I mentioned earlier in this morning’s session that the Danish Parliament had about 75 mandate discussions with Ministers every year. As a member of the European Affairs Committee of Cabinet, every week I see several write-rounds from ministerial colleagues seeking collective agreement to a negotiating position on a particular item of legislation. They vary in the level of political importance or controversy. This Committee would be in permanent session 365 days a year if it tried to have a session with the Minister on each of those-it would be completely impractical-so some agreement would have to be worked out on how to identify those things of greatest importance, and for those to be the ones on which they would focus.

Chair: The fact is that, because we have the system we do have, we look at everything, and that means there is complete cover that nothing is being done that should not be done and we can inquire into it. The House of Lords has a different system. To that extent-you have mentioned it already-there is perhaps a more generalised approach based on looking at the policies that lie behind it in a more general sense, but if the Select Committees were to be involved, that would provide a balance between complementary assessment by us on a list-of-documents system on the one hand and the involvement, where appropriate, of a Select Committee in terms of more general policy questions, so I hope we are moving towards a system that will enable us to be able to strike that balance you have referred to. Of course, that would be subject to our further considerations before we come to the end of our report.

Q530Jacob Rees-Mogg: I think this gets absolutely to the heart of the matter. We are trying to do two things, as Parliament. The document-based system is very good at redress of grievance. If there is something that people are concerned about, that is covered; that is sent for debate; it could be on the Floor of the House. That is one of the most ancient responsibilities of Parliament. The mandate system is much more Parliament as a legislative body, because it is giving its consent to laws that will come in advance of them being implemented. We need to find out, in this inquiry into scrutiny, whether we are capable of doing both sides: both the redress of grievance and the consenting to legislation. Although you are saying the quantity would be very difficult, and therefore we may need to prioritise, we may need to find some hybrid system that is both document-based and mandate, so that we are doing the full job of a Parliament, rather than simply the redress of grievance.

Mr Lidington: I understand the points that Mr Rees-Mogg is making, and I see the logic behind them. I would make just two points, by way of response. First, as I think you would expect me to say, representing the Government, if there were to be a proposal for this type of hybrid system, consideration would have to be given to the amount of both official and ministerial time that would be involved. I could not simply agree to a set of arrangements that would impose a very considerable additional workload upon Government that we would struggle to deliver.

Secondly, of course, a mandate system of whatever kind does raise again the question of confidentiality. The Scandinavian countries that have mandate systems have private sessions of their Committees with the Ministers. Those discussions are not made public, so the Minister can go off to Brussels having discussed the mandate, with the approval of his Parliament, knowing that the negotiating position has not been described to all and sundry.

Q531Nia Griffith: Last October, you told us about involving UKREP officials, perhaps, to give oral confidential briefings to relevant Select Committees. Can you tell us whether there has been any progress in that respect and whether you have general agreement across all Government Departments to participate in such sessions?

Mr Lidington: We tried to show, at the FCO, by agreeing to the Permanent Representative, Sir Jon Cunliffe, coming and giving evidence to this Committee, that we are serious about wanting to make this work. I am certainly very willing to have my officials be as accessible as possible to this Committee and the Lords Committee where the items under discussion are a Foreign Office responsibility. But it is for each Secretary of State to determine the extent to which he or she will let his officials go to the Committee. It is a matter for each Department individually to decide.

Q532Nia Griffith: Has anything happened to date? Has there been any example of this procedure taking place?

Mr Lidington: I know that, in the Lords, there have been some discussions of that type-the informal briefings from officials-but that has been part of the working culture of Lords Committees and subCommittees for some time. I do not know about the Commons. Members of this Committee would probably know better than I what the situation is there, because the reports as to which Minister or officials have come to give evidence to this Committee is not something that would automatically come to me for approval in any way.

Q533Nia Griffith: There has not been any specific drive from your Department.

Mr Lidington: We made it clear, in our discussions with the scrutiny coordinators across Whitehall, that we think this is a sensible approach, but it is ultimately for the Ministers in each Department to decide, case by case, whether they will agree to a request from the Committee or take the initiative and offer this. My approach generally, where a foreign policy dossier has caused the Committee to come back after an explanatory memorandum and ask questions, has been to say, "Well, if you like, I am very happy to let my officials come and talk to you informally, off camera, about this, and give you some update information, even if we do not have a document that is caught by the scrutiny resolution." I encourage my colleagues to do that, but I cannot order them.

Q534Nia Griffith: Could we perhaps move on to talk about the appointment of the head of UKREP? Do you think that, in making that appointment, he or she should be subject to a pre-appointment hearing, given that effectively he is the representative of the British legislature in Brussels, and has a very significant role, particularly in COREPER, in fashioning the way that our agreement is made and our consent is given to legislation?

Mr Lidington: No, I do not. It is certainly a very important role, but the Permanent Representative is an official who acts in line with policies that have been agreed by Ministers. In that sense, he is in the same position as the British Ambassador to Washington, Beijing or Berlin, or our Permanent Representative at the United Nations. No, the constitutional distinction that officials follow ministerial mandate, and it is Ministers who are accountable to Parliament for their officials, is the right one to maintain.

Q535Chris Heaton-Harris: That is not strictly true, is it? This particular role involves a lot of negotiation. As we were discussing earlier on limité documents, some things are then presented to Ministers, not as a fait accompli but as a process that has already started, and with the knowledge of this person. This particular role is actually much more dynamic than anything that would be going on in Washington or even the United Nations, and certainly in China. Surely you can understand the worry of some parliamentarians that they have not seen the next person who is going to head out to Brussels to be our chief negotiator. They are way more than bagcarrying for the country when they go to Brussels and negotiate on these things.

Mr Lidington: They certainly need to be individuals of the highest calibre, but the way in which the Permanent Representative operates is that he is bound by the mandate given by the Cabinet through the European Affairs Committee. On every new negotiation, the relevant Minister writes to the Foreign Secretary, as Chairman of the EAC, setting out what is being proposed, and the proposed negotiating position and the reasons for that. Other Ministers on the Committee then write in, or sometimes there is a discussion at a session of the EAC. At the end of that, a collective Government position is agreed, which, in effect, defines the limits of the mandate under which UKREP then has to work.

What then happens, of course, is that, at working group or junior official level, and ultimately at COREPER with the Permanent Representative or his senior team in the Chair, there are detailed negotiations. I know from the documents that I see, over my areas of responsibility, that where there is a proposal that would appear to go beyond the EAC mandate, and certainly anything that seems to test one of our red lines for negotiation, the Permanent Representative comes back to Ministers. I have had papers come to me where UKREP has said, "We think we can get X and Y, which you have told us are really important for British interests. In order to do that, we think we are going to have to sacrifice Z, which you said you want but is lesser order." I can approve that, if it is within the EAC mandate. If I want to go beyond what is in the remit from the European Affairs Committee, I have to initiate a new writeround to Members of that Committee to get collective ministerial agreement, and therefore by definition crosscoalition agreement, to the variation in that position. I have done that on occasions, and so have Ministers in other Departments.

I go back to what Jon Cunliffe said when he gave evidence here. He said that, if things change, the Minister will write back to the Cabinet Committee. The Cabinet Office is heavily involved here in making sure that different Departments with interests are all in the loop as far as progress of negotiations is concerned. Of course, you are not dealing with something that is just dumped in the in-tray of the Permanent Representative. These proposals, as Chris Heaton-Harris knows very well, go through working groups; they are examined in painstaking detail by junior officials, by the legal advisers to the Governments concerned, before they come up to COREPER level.

Q536Chair: If I may say so, Minister, the manner in which the whole of this issue is being discussed in the Scrutiny Committee inquiry that we have set up, and your responses, particularly today, in the context of Bloomberg and all the questions that are raised in COSAC about democratic legitimacy and all those matters, demonstrate that there is some really serious thinking going on about the manner in which the United Kingdom, whether in Government or Parliament, is viewing the modus operandi of the European Union, in terms of democratic legitimacy. When we asked Sir Jon Cunliffe this question, if I recall it correctly, he did not rule out a pre-appointment inquiry of his successor, for example. He did not in any way commit himself to this, and maybe it was a difficult question for him to answer, but the reality is that he did not just say, "Well, that would be unacceptable," which is what you are saying.

I would simply say this. When I looked at the Liaison Committee analysis of the pre-appointment memorandum from the Cabinet Office, which was very interesting, there were lists and lists-you have probably seen them-of pre-appointment inquiries that have taken place in relation to other Departments. The one Department, I think I am right in saying, that has no pre-appointment inquiries is the most prerogative-based Department of all, which is yours. I am not entirely surprised to hear you say that. It goes back to the 17th century, I think. The question is whether it is really appropriate, at the present time, to exclude, as Professor Simon Hix put it, the head of UKREP as a representative of the British legislature in Brussels. He is saying that he believes there is a very close connection between what UKREP is doing, what the Ambassador there is doing, and the whole of the legislative process. We are moving into a new era, as it were. I invite you therefore just to reconsider the question. If you would like to, of course, you could write to us about it.

Mr Lidington: I am always happy to write to you, Chairman, on this or other subjects. I would say that Jon Cunliffe is a very experienced and able official, and he would have known full well that for him to have ventured either a yes or a no to your question about holding a preappointment hearing for his successor would have been quite improper. That is entirely a matter for Ministers to decide, not officials themselves.

Q537Chair: That is not what he said. I had better quote him, because it is an opportunity that I am not going to miss. "First of all," he said, "I think a number of my ambassador colleagues would believe they also had important roles in that sense. I have to say that that is a policy question. It is a question for Parliament and for the Government. I work within the system that we have and I am sure Ministers would be happy to answer on that." That is your opportunity.

Mr Lidington: Parliament can legislate for particular arrangements, if it chooses. I do not want to hold out any real hope, this morning, that the Government is likely to agree to the sort of preappointment hearing that you have in mind.

Q538Jacob Rees-Mogg: I was just going to ask, Minister, if you think that a role of this seniority and critical sensitivity, involving legislation, should be held by a Minister. The example is, of course, Harold Macmillan in the Second World War, who was a nonUK resident Cabinet Minister.

Mr Lidington: I knew that. That would be a way of squaring the constitutional circle on this. That is very true. I note in passing that no EU member state has a Minister in the role of Permanent Representative. I can absolutely understand the case that Mr Rees-Mogg is advocating. I would have a couple of quite serious questions about it. One would be over how that individual should be accountable to Government and Parliament. He would have to, presumably, if not a Secretary of State, be responsible to a Secretary of State. You would still be in the position where you would have to have a system, as we have now with the Cabinet Committee, for collective agreement to mandates in particular negotiations.

There would be an issue of practicality. You could have somebody, I suppose, who was a Minister in the House of Lords, who did not have a constituency to look after, in such a role, but for a Member of the House of Commons it would be extremely difficult, just in terms of the amount of time involved, to carry out that role.

There would also be the question as to how somebody who was a Minister in that role dealt with the Minister who was responsible for all the bilateral relationships with the 27 other EU member states. One thing that has really been borne in on me in the last three years is that you cannot simply do European policy in Brussels alone. You have to know, and get to, Berlin, Paris, Rome, Warsaw, Stockholm, Madrid and Vilnius now, and so on. The advantage of the system that we have at the moment is that, at ministerial level, there is responsibility both for the European Union institutionally, and for relations with the member states of the European Union bilaterally. That could be at risk under this proposal.

Chair: Now we move on to Lidington opt-in debates on the Floor of the House. It could be described as your special subject, if I can put it that way round.

Q539Mr Clappison: The Minister has been immortalised. Lidington debates will no doubt be familiar to generations of politics students to come. We were told, and have been repeatedly told, that the Government was committed to enhancing parliamentary scrutiny of EU justice and home affairs through these debates. So far, however, only two debates have taken place, both in circumstances that some would judge to be less than satisfactory. A third debate has recently been postponed. You and your ministerial colleagues have accepted, in oral evidence given to this Committee, that it is entirely reasonable to expect to have a minimum of one week’s notice of the Government’s recommended approach to important optin decisions so that we can report them to the House before the debate takes place and MPs can be properly informed. Can you tell us why the commitment to a minimum of one week’s notice is not reflected in the Government’s code of practice on parliamentary scrutiny of EU justice and home affairs legislation?

Mr Lidington: That last point is one that we want to come back to once we have done what needs to be done on the immediate issues that are before us and are quite understandably arousing concern amongst this Committee, the Lords Committee, and for that matter the Home Affairs and Justice Select Committees as well. We postponed the debate in the Commons to give the Government more time to consider its position on the Europol opt-in. Lord Taylor said that in proceedings to the House of Lords on 1 July. We are very clear about our intention-indeed our duty-to hold a debate, which will need a motion that sets out the Government’s position. The issue is an important one, and the detail of the proposed new Europol measure has required a lot of careful consideration about both the legal and the political implications.

I am acutely aware that, while we have until 30 July to make a final decision on Europol, the Commons is due to go into recess on the 19th. Without going into details I ought not to go into, it is fair to say, in dealing with this issue, but even more so with the bigger issue of the 2014 mass opt-in or opt-out, there has been a need to seek agreement between different Government Departments that each have important interests at stake. There has been a need to consult the practitioners, who have views. There has been a need to secure agreement in the coalition, within which it is no secret that historically the two parties have approached these issues from somewhat different perspectives.

I very much regret the fact that it has not been possible yet to take forward these debates. Parliament is entitled to expect there to be sufficient time granted. I certainly apologise in advance if that proves not to be possible. I hope very much that we will be in a position to take matters forward on both Europol and the 2014 decision in the very near future.

Q540Mr Clappison: Can you add to what you have said already on that? I appreciate that has been very generous. Would it be possible to have an undertaking from the Government that we will have at least one week’s notice of what the Government intends to do within the timetable you have set out, which is quite constrained?

Mr Lidington: I cannot give a firm commitment on that, no. I hope that the Government will be able to make its position clear in the very near future.

Q541Mr Clappison: On the 2014 mass optout, which you have raised, have the consultations been concluded or not? We know nothing about the Government’s intentions.

Mr Lidington: Until an announcement is actually made to Parliament, one cannot say that a final decision has been definitively reached. Until something is openly said to Parliament and the Government has made a collective commitment, there is always the possibility that an event happens.

Q542Mr Clappison: Will there be good time for Parliament to digest what the Government decides to do before there is a debate on this?

Mr Lidington: There are two things here. First, the Government has said that it is minded to exercise the mass opt-out and to seek to opt back in to a number of measures. We have pledged a debate and a vote in Parliament. What is also the case is that, if we proceed along the lines that the Home Secretary indicated last year, we would be looking at a period of negotiation on applications to opt in. It would be perfectly reasonable for the relevant Committees of Parliament to seek to follow the course of those negotiations, and perhaps have either formal or informal sessions with Ministers or officials about that.

If, at the end of such negotiations, the agreements for opting in take the form of formal decisions of the Council, then those are, at that stage, automatically caught by these scrutiny resolutions as well. Therefore, at that stage too, in addition to what the Government has undertaken, they would fall subject to scrutiny, and therefore potentially to reference for further debate.

Q543Mr Clappison: And a vote on them.

Mr Lidington: That is a matter for Parliament. In the case of any document that falls under the scrutiny resolutions, and on which an explanatory memorandum is deposited, if the Committee refers something for a debate, then that debate when it takes place has to be on a motion that is amendable and votable.

Q544Mr Clappison: Minister, you have rightly said that this is all subject to the processes of the coalition. Can you tell me how this fits in with the Prime Minister’s announced review of competencies? If there is an optin back to any of these measures, will that then be subject to the review of competencies?

Mr Lidington: They are parallel exercises. The 2014 opt-in decision is a decision that is required of us under the Lisbon Treaty and subject to deadlines set out in the Lisbon Treaty. There is no flexibility over those. The balance of competencies review is a voluntary policy exercise, undertaken by the Government. When we come, in due course, to the chapters of that exercise that cover justice and home affairs matters, it will be open to people and organisations that give evidence to submit whatever case they wish.

Q545Mr Clappison: Will it fall within the ambit of the review of competencies or not?

Mr Lidington: It is entirely up to somebody submitting evidence to say whatever they want. For example, somebody could make a case there to say that they would like to change the treaties to recreate the third pillar. Somebody might want to put forward a case to argue that there is evidence to show that particular EU JHA instruments have worked well and that their scope should be enlarged. Someone could argue for a European Public Prosecutor, if they wanted to.

Q546Mr Clappison: It would be open to the person who is deciding on the outcome of this review of competencies to decide, say, to opt back out of matters that we just opted in to.

Mr Lidington: No. With respect to Mr Clappison, I think he is misunderstanding how the review is being structured. The Foreign Secretary made it clear in his statement announcing the review last year that it would not lead to reports that made policy recommendations. The review is an analysis of evidence. The first six reports, which I hope will be published before the recess, will demonstrate this. They will summarise the evidence and the balance of evidence put forward by those who have responded on those areas of policy. The reports will highlight some of the tensions and some of the political choices that have to be made.

For example, the report on taxation-I am not giving too much away-will flag up the fact that, while there is an interest for multinational business in having corporate tax arrangements determined on a more European basis, because it makes for fewer transaction costs, ease of doing business and predictability, that has to be set against the cost to tax sovereignty and control over revenue by national Governments. There is a political choice that parties seeking to form a Government have to make in that context.

The reports will, we hope, then serve as a quarry from which individual political parties and others will draw policy conclusions to inform, perhaps, Government policy, but also individual proposals. Say the Government sees something in a report, a piece of evidence, and thinks, "That is really good, and we have agreement on this. We would like to take that forward before 2015." There is nothing to stop us doing that, but the reports themselves are not going to come out with a list of policy recommendations.

Q547Mr Clappison: But with a yes or no answer, it does sound as though it does, yes, fall within the review of competencies.

Mr Lidington: Yes, it does. If people submitting evidence want to comment on that, they are free to do so. What the Lisbon treaty does is provide us with a binding timetable within which these decisions have to be resolved.

Q548Mr Clappison: It is quite up to a person to say "no", and not opt in to any of it?

Mr Lidington: It is open to people to say that, if they wish to.

Q549Mr Clappison: Indeed, that was the reason given by the previous Government-the absence of justice and home affairs-as to why it was unnecessary to have a referendum on the Constitutional Treaty, because it was said that made it very different.

Mr Lidington: Though I am tempted, I think it is probably best I do not get drawn into going over the old battleground.

Q550Chair: No doubt you would not want to answer a question about the rumours going around that it is the intention of the Government to opt back in on the European Arrest Warrant?

Mr Lidington: I tend not to comment on rumours. It is better that we wait for the announcement to take place.

Chair: As Francis Bacon said, rumours are like bats: they fly in the dark.

Q551Jacob Rees-Mogg: I want to ask a very simple question, to which I think I know the answer. If we opt out, what we have opted out of ceases to be, from our point of view, a European competence. Therefore, if we opt back in, do any of them engage the 2011 Act?

Mr Lidington: The answer to the second question is no, because the 2011 Act is about future treaties or amendments to treaties, with a certain number of specific exceptions. This is not an amendment to the treaty. It is the exercise of a duty that we have that is within Lisbon. It is not the case either that something we opt out of ceases to be an EU competence. Opting out of something means that, when that preLisbon measure at the end of 2014 is subsumed into the postLisbon acquis, we are outside its scope. It is open to the Commission, in accordance with Lisbon, to bring forward in the future a new initiative covering an area of criminal justice or policing policy where we have opted out of a preLisbon measure. As that is a new measure, though, our right to decide then to opt in or out is completely untrammelled at that point. At that point, we would look at that measure on its merits; our legal advisers would trawl through the detail and so on in the way we do with any other JHA measure that comes forward.

Q552Mr Clappison: It is slightly misleading to talk about this merits business, because the purpose of the Justice and Home Affairs Charter is to create a European area of freedom, justice and security. Insofar as we opt in to any of it, we are submitting ourselves to the European area of freedom, justice and security and the jurisdiction of the European Court of Justice.

Mr Lidington: A lot depends on what one thinks is the significance of an area of freedom, justice and security. There are certainly those who want to have a common system of criminal justice and policing throughout the European Union. I do not think there are many in the House of Commons of any political party who want to go down that route; there are a few enthusiasts, perhaps, but the common law system in England is something that most English MPs would ardently defend. What is the case is that, as a Government, there are some postLisbon measures where, when we looked at the detail, we did not believe that our opting in would compromise our right to make our own arrangements-we were not losing important powers-and that opting in would bring us advantages in terms of being able to fight crime more effectively in an age when criminals are able to operate much more freely across national frontiers.

Q553Mr Clappison: I understand that is the purported justification of it, but it remains the case that the country is being submitted to the European area of freedom, justice and security. We could argue whether or not this is a good thing, but this is the purpose of it. You need to set that purpose out, rather than try to pretend this is just a piece of fine-tuning and opting in on a piecemeal basis.

Mr Lidington: It depends what is meant by that phrase about area of freedom, justice and security.

Mr Clappison: I rely on the words in the Treaty, which I think are quite clear. I have not got them in front of me, but you and I are familiar with them. We might as well put them in front of people and let people decide.

Chair: We will leave the exchange at that point.

Q554Jacob Rees-Mogg: In terms of opting back in, is it open to the Government, instead of doing so under the auspices of the Treaty, to opt in on a bilateral agreement with the European Union covering these areas, and therefore not having the matters justiciable in front of the European Court of Justice?

Mr Lidington: If we opt out of measures, then, yes, for many of them we would certainly have the option of seeking to agree bilateral arrangements. With 133 measures, it is impossible for me to give a definitive answer here on the options for each of those, because the arrangements would vary. It is also not clear, and it may vary from one measure to another, whether any such bilateral agreements would need to be with individual member states or with the EU collectively. The view of other member state Governments is actually different. Some would say it would have to be bilateral; some would say, since Lisbon, we have given up a right to have bilateral agreements, so it would have to be with the EU.

Q555Jacob Rees-Mogg: I was thinking obviously that we are in the process of a US-EU free-trade agreement. The EU can negotiate agreements where it has competence. It does have competence in these areas under the existing treaties. It would be highly preferable, from a UK point of view, to maintain our future independence and, if we did want to opt back in to any, to do it as bilateral arrangements, which are outside the structures of the ECJ.

Mr Lidington: The bilateral agreements come in as an alternative for any measure we decide to opt out of permanently.

Q556Jacob Rees-Mogg: We opt out of all of them if we opt out of any.

Mr Lidington: We opt out of all of them. We could decide to stay opted out of all of them and to seek bilateral agreements instead. That is Mr Rees-Mogg’s preference. We could decide to exercise the mass optout, and then to opt back in to a number of EU measures, which would then, of course, be subject to the jurisdiction of the ECJ, and so on.

Jacob Rees-Mogg: And would be permanent, whereas a bilateral agreement could be renegotiated.

Q557Mr Clappison: Croatia is very, very important. Are you happy with the outcome of the process of Croatia’s accession as far as issues such as corruption and rule of law in Croatia are concerned, which were raised and made the subject of monitoring?

Mr Lidington: It is a "yes, but". I am happy with the progress that Croatia has made. What Croatia has managed to do in even just the last four years in terms of judicial reform, anti-corruption, police reform and so on is a remarkable achievement. Yes, Croatia needs to do more, but the Croatian Government is committed to take this forward. Our view was that they had met the tests that were required.

The "but" is that not just the UK but other member states and the Commission too recognise that, while the creation of Chapter 23 had been a significant advantage, in which the EU showed it had learned something from the experience with Romanian and Bulgarian accession, it had been opened and negotiated too late for Croatia to have had sufficient time over a number of years to develop a track record of progress. Therefore, with Montenegro’s negotiations, a new accession sequence has been adopted. With Montenegro and for any future candidates for membership, Chapter 23 will have to be addressed first. The very first chapter opened will be on human rights and rule of law, so that those countries have time not just to change their laws and implement changes but then to show, as other chapter negotiations continue, that they are simply establishing, year by year, a good track record1.

Q558Mr Clappison: Do you think the postaccession monitoring has been more successful for Croatia than it was for Bulgaria and Romania?

Mr Lidington: Croatia is not subject to a co-operation verification mechanism in the same way as Romania and Bulgaria were. Our judgment, like the Commission’s, is that Croatia has actually progressed a great deal further than either Romania or Bulgaria had done at the point when they were admitted as members.

Q559Chair: We now move on to the last few questions. One very important issue, I think you appreciate, is in respect of the EU trade negotiations. You may know that I asked the Prime Minister a question about this. I also asked you a number of questions in the European Standing Committee some months ago about the manner in which these were being conducted. When I asked the Prime Minister, bearing in mind that the European Commission has effective control over the framework, I asked him about the areas and the matters that would be covered, pointing out that it is an exclusive competence under the Treaties and that they would be of huge significance. The question is to what extent we would have access to the negotiated mandate, as agreed by the Foreign Affairs Council, so we are told, last Friday. The Prime Minister answered to say he would do what he could to help; I think those were the exact words.

As the Committee is now reviewing how EU trade negotiations are conducted, and how the Commons can be both kept informed and influenced, the point is that, because the only depositable documents are published at the end of negotiations, Parliament actually does not know what is being included, what areas and what the terms of reference are. Therefore, what we want to know is: are these negotiating mandates and revisions all considered too confidential to deposit, despite the importance that is being attached to these by the Government, by the EU and by other countries? Is there a way around this other than relying on ministerial goodwill to keep us informed?

Mr Lidington: The Prime Minister, I think, will be writing to you, Chairman, following your exchange in the Chamber. I do not want to steal his thunder, and I think Lord Green has offered to come to the Committee, if you would find that helpful, as well. Yes, this is an exclusive EU competence. The Commission goes away and conducts the negotiations on the basis of its mandate and then comes back and informs the Council of the progress of those negotiations. We and other member states, including Germany, have said to the Commission that, above all in dealing with the United States and in trying to negotiate such an ambitious and wide-ranging agreement, it is in everybody’s interests that the Commission work closely with Member States, because we all have our networks of contacts in Washington and at state level, where we can assist Commissioner De Gucht and his team without detracting from their lead role here.

The Commission has committed itself to keeping the Council and the European Parliament informed about and involved with developments. The job of Ministers here will then be to be in touch, yes, with Parliament, and also with key interests in British industry, about progress on the negotiations.

My understanding is that drafts or sections of trade agreements are not depositable. They are not caught formally by the scrutiny process. I do not think I can predict exactly what the best way forward would be. It would depend on the progress of negotiations, but probably at the start, at any rate, the best thing would be for the Committee to take up Lord Green’s offer and to discuss with him, as the Minister directly responsible, how the Committee could best be kept informed about the key developments in a negotiation that is likely to take at least a couple of years.

Q560Chair: There are Cabinet Office guidelines on some of these matters. I refer, for the record, to paragraph 235, relating to draft negotiating mandates, which says that "Departments should provide the Chairmen of the Scrutiny Committees with details of negotiating mandates as soon as they have been approved. This should include mandates for negotiations with third countries and international organisations and also mandates for negotiations within international organisations without breaching confidentiality." We understand all that. I do not think I need to read out the entire paragraph, but it does say that "Departments should ensure that the Committees are kept informed as much as possible about the scope and development of negotiations prior to signature and/or conclusion of an agreement" and so on. Of course, because these are so important and the question of qualified majority vote comes in, how would you anticipate in principle the manner in which qualified majority voting would bite in the conduct of these negotiations as they progress?

Mr Lidington: I certainly will not go over the whole text of the Cabinet Office guidance. I do need to stress, in the passage about providing negotiating mandates to the Chairmen of the Committees, the phrase "without breaching confidentiality", which is important.

Chair: It takes us back, in a way, to the limité question that we were talking about before.

Mr Lidington: It is exactly that question again. All the trade agreements that I have seen happening involve, in the end, a compromise, obviously, between the EU and the third country involved. That has been the case with Korea and Singapore, the two that have been successfully negotiated in the lifetime of this Government. There are obviously different interests at stake amongst different member states of the European Union. It is not just qualified majority voting that is at stake here, because at some stage in trade negotiations unanimity is required, as well as agreement at the final stage, of course-the consent of the European Parliament to the final text of a trade agreement.

Those discussions take place between member states and the Commission as the negotiations proceed. I do think that, with the United States deal, there is a general recognition that the potential benefits not just in reducing tariffs but in eliminating nontariff barriers-in effect creating global regulatory standards on a transatlantic basis, rather than waiting for the Pacific to do this deal-attract even those who have taken a more protectionist view of trade policy. It is striking that France has gone along with a very wideranging mandate; yes, there is a particular concern about audio-visual, although the Commission has the freedom to bring audio-visual back into the scope of negotiations at a later stage. A few years ago, one might have thought that France and others would have blocked even the start of these negotiations, but I think they see the prize that is available.

Q561Chair: How do you evaluate the exclusive competence that overrides all other bilateral agreements in the field and zones in question with our bilateral arrangements, for example, with other emerging markets in the Commonwealth and, in fact, throughout the world? You understand, I am sure, that by having an exclusive competence in the hands of the EU, where we are, to use the Prime Minister’s and the Chancellor’s expression, in a global race, where competitiveness is a key, we are in a special place in relation to Commonwealth countries where there are emerging markets. We have a common language; we have a common commercial law in many respects. I was talking to the Prime Minister of Malaysia yesterday about some aspects of this. He is here, as you know only too well, seeing the Prime Minister today. The question therefore is to what extent we might be excluding ourselves as the United Kingdom from very important and potentially prosperous deals with other countries throughout the Commonwealth, emerging markets, Africa and the rest.

Mr Lidington: It is ultimately a political decision to be made. The arrangements under the treaties that give exclusive competence to the EU and the Commission for international trade negotiations mean that we, like Germany and like France, cannot simply go ahead and try to negotiate our own bilateral trade deal. At the same time, those treaty arrangements make available the collective leverage of the EU and 500 million people, rather than the UK and 60 million people. If I look at the United States, they have been pretty clear that they were interested in doing a deal with the EU simply because of the sheer size and scale of the EU marketplace. They would have been, I think, less interested in separate bilateral arrangements with even the biggest member states.

Chair: I understand that. We need to move on to Neighbourhood Policy action plans and the EUSRs. Finally, I will say that, historically, for the last 400 years, the United Kingdom has found itself, through its capacity to trade effectively, able to do so without necessarily having this enormous structure within which to do it. Perhaps we could leave it at that.

Q562Chris Heaton-Harris: You have been very generous with your time, Minister, and I shall endeavour to be very quick on these two. The first is on European Neighbourhood Policy action plans and whether they should or should not be adopted by Council decisions. Can we take it that you will agree to our revised Standing Order referring to action plans by name as depositable documents?

Mr Lidington: No. The problem with action plans is that they cover such a wide range of documents. They are not defined in the treaties in any way. Sometimes action plans can be documents that are politically important; they will define the EU strategy towards a particular country or region of the world. We do try in Government, where that is the case, to submit them for scrutiny. If they are issued as Council decisions or Commission communications, first of all, they are depositable under the scrutiny process anyway. The enlargement strategy, which was a communication, and the joint communications of the EAS and the Commission on the counterterrorism action plan for the Horn of Africa and Yemen were caught by scrutiny.

You also get some things described as action plans that are frankly much less significant. When a term is not defined in any way in a treaty or law, I would be reluctant to give a blanket commitment to make it subject to scrutiny in all circumstances. What I would prefer is a working culture in which the Government really does try to ensure that, where something is of political significance, it is drawn to the attention of the Committee. Where those action plans take the form of Council decisions or Commission communications, they are caught anyway, and we will continue to supply those to the Committee.

Q563Chris Heaton-Harris: Moving swiftly on to a slightly more contentious area, the European External Action Service and the European Special Representatives, we understand that you have written on no less than three occasions so far to the High Representative about the need for timely submission of Council decisions, such as those renewing the mandates of these EU Special Representatives. The latest round of mandates and budgetary renewals has been poorly handled by the External Action Service again, with too little time allowed for parliamentary scrutiny. Given that your letters so far seem to have had little effect, what else can be done in this area to improve the efficacy of the External Action Service?

Mr Lidington: It does require a cultural change at the External Action Service. What happened this year was profoundly unsatisfactory. I was hoping to be able to speak to Baroness Ashton directly. Because of our respective travel agreements, that has not proven possible. I have written to her, and I think we are sending a copy of the letter to the Chairman. Of course, now we have a firm commitment to an October discussion of horizontal issues affecting EUSRs, that should be the occasion, amongst other things, to have a really hard look at this process and to ensure that the EAS builds into its working culture and its preparatory arrangements a proper respect for national scrutiny processes. The Committee will see, when my letter is circulated, that I have made just one constructive suggestion: if the EAS would like to send officials to London and talk to our people and parliamentarians involved in the scrutiny process, trying to internalise the importance of this and the timescales involved, that might help to shift the working culture.

It was dissatisfactory. In fairness to Lady Ashton, she has said openly that this year’s episode has not been the EAS at its best. She has said that she started to think about the latest batch of proposals on Special Representatives as far back as January, but no information was given to member states until her letter of 3 May. The reason why I did not instantly write to the Committee at that stage was that there was a unanimous response, by all 27, to disagree with the High Representative’s proposals, so they were clearly not going to come forward in an unaltered form. Alternative proposals were put forward. The EAS did not provide a response to those until 7 June. We got to 7 June. Lady Ashton came herself to the PSC and said she was not going to try to stand in the way of what they want. At that point things moved forward quickly and a compromise package was agreed. That went forward to RELEX on the same day for detailed discussion, but inevitably a lot of time had been lost in the interim.

I was very fed up with the fact that we had been asking for a long time for this discussion of horizontal EUSR issues, including not just that scrutiny but salary levels and other arrangements. There had been a commitment to have one this year, but no date. I said at the end of the day that my officials should tell the EAS that, until I got a firm date and a commitment locked down for a time in the autumn, I was simply going to block any agreement on renewal of EUSRs. We have now got that for October; that was then agreed fairly quickly. We will continue to work on this. It was not a happy episode but, as I say, in fairness to the High Representative, she has acknowledged that mistakes were made at their end.

Chair: I have one final thought, because this is probably the last time we shall be seeing you before we finalise and publish our report, which will be in the autumn. To put it simply, the reason for this inquiry goes to the heart of our Standing Orders and the purpose of scrutiny in enhancing our democratic engagement with the whole process of European legislation and its impact on the United Kingdom. The question of who governs Britain and how is always part of that. It is not just a process question, although that inevitably does crop up. We are extremely glad to have had this extended session with you. It has been a very good exchange, if I may say so. I am grateful to you for coming and for the openness with which you have addressed the questions, which are part and parcel of what we now have to finalise. Thank you very much for coming.

[1] Witness correction: With Montenegro and for any future candidates for membership, Chapter 23 will have to be addressed among the first.  One of the very first chapters opened will be on human rights and rule of law, so that those countries have time not just to change their laws and implement changes but then to show, as other chapter negotiations continue, that they are simply establishing, year by year, a good track record. 


Prepared 27th November 2013