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Lord Gallacher: I am grateful to the noble Earl for his response. He wishes to draw the attention of the parties to what is in the agreement. For that reason, he says that the tenant can seek advice. It may be that in the light of his remarks on this side of the Committee we shall have to do the same.

The noble Earl does not like the prospect of the parties not contracting in until later. That also is something which we shall need to discuss.

Although the noble Earl's reply was adequate, I confess that I am still puzzled with regard to the necessity or otherwise of the agreements to be in writing either at the time or subsequently. Nevertheless, I shall read his remarks and in so doing I shall take account of his observation that there is no need for Clause 36(3) to take note. That may affect our attitude on Report, but in the meantime, I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Lord Inglewood: I beg to move that the House do now resume.

Moved accordingly, and, on Question, Motion agreed to.

House resumed.

European Council, Essen

3.38 p.m.

The Lord Privy Seal (Viscount Cranborne): My Lords, with the leave of the House, I shall now repeat a Statement made in another place by my right honourable friend the Prime Minister on the European Council at Essen. The Statement is as follows:

"With permission, Madam Speaker, I should like to make a Statement on the European Council at Essen which I attended with my right honourable friends the Foreign Secretary and the Chancellor of the Exchequer. The Council's conclusions have been placed in the Library of the House.

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"The European Council achieved five key British objectives: strong support for the peace initiative in Northern Ireland, including additional funding of £240 million; commitment to an intensified fight against fraud and mismanagement; solid progress on subsidiarity—and it is agreed that next year the Council will complete its review of the existing Community statute book; priority for labour market flexibility and deregulation to make Europe competitive and create jobs; and a strategy to prepare for accession to the Union of the six central and eastern European associate members.

"At the request of the presidency, I briefed the European Council on the peace process in Northern Ireland. There was unanimous agreement to a Commission proposal to provide an extra £240 million over three years to help urban and rural regeneration in Northern Ireland and the border counties of the Republic. I am grateful for the strong support that President Delors has given to Northern Ireland.

"I raised the subject of fraud, waste and mismanagement of the budget following the Court of Auditors report. I said that the European Union would not enjoy popular support unless it took vigorous action against those abuses. I made a number of proposals which were agreed by the Council. Those were as follows. The Council must ensure that reports from the Court of Auditors are rigorously scrutinised and followed up. Each member state must report to ECOFIN on what it is doing to combat fraud in its own country. Agreement should be reached rapidly in Brussels on measures now under discussion. These include a British proposal put forward by my right honourable friend the Home Secretary which would oblige member states to co-operate and act effectively to fight criminal fraud against the EC budget. Finally, the new powers given in the Maastricht Treaty—as a result of British initiatives—to the Court of Auditors, the European Parliament, the Commission and the Council should be used to the full.

"I made clear that the taxpayer's money must not be misused. The fight against fraud, waste and mismanagement will remain high on our agenda. That view was strongly endorsed by the Commission and a number of member states.

"The European Council confirmed again that subsidiarity—the principle of minimum community interference—must be a guiding principle of the European Union's future work, as agreed at Edinburgh. I am encouraged that so far in 1994 there have only been 42 Commission proposals for significant legislation compared with 185 in 1990. But the new Commission must keep up the fight against unnecessary interference.

"Discussion of the economy focused on the need to create jobs. Yet again the policies that we have been following in this country were widely accepted to be right for the European Union. We agreed that Europe must be more competitive. We agreed on the need for more flexible working arrangements, for the reduction of labour costs and for better education and training.

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"There was nothing in our discussion to suggest that socialism had triumphed over market liberalism. The reverse is plainly the case.

"The European Council added three new priority transport projects to the list of TransEuropean Networks agreed at Corfu. Four out of the 14 are United Kingdom projects: the Channel Tunnel Rail Link, the West Coast Main Line, the rail route from Cork to Larne and the Holyhead to Felixstowe road link.

"The Essen Council effectively rejected the long-debated proposal for a European Union-wide carbon energy tax. It supported instead the approach which Britain has advocated all along: a flexible framework allowing those member states which wish to introduce a carbon energy tax to do so. We will not wish to do so.

"Enlargement of the European Union has long been a British objective. At the Edinburgh and Copenhagen Councils the decision in principle to open membership to the six countries of central and eastern Europe was taken. At Essen, leaders of the 15 European Union states, including Austria, Finland and Sweden, met their central and eastern European counterparts. Agreement at the Council on a strategy to draw the six associate members closer to the Union was another important step to help prepare for their eventual accession.

"On Bosnia, there was strong support for the UNPROFOR commanders and the work being done by the brave men and women who they lead. They are saving lives and bringing better living conditions to many parts of Bosnia than would otherwise be possible. We agreed that UNPROFOR must be allowed by the Bosnian-Serbs to get on with its job without obstruction and should stay, provided the risks were acceptable. It was our unanimous view that the enforced withdrawal of UNPROFOR could have disastrous consequences—above all, for the people of Bosnia. But we agreed that we needed to plan for all eventualities and to keep in close touch with other troop contributors and interested governments.

"The European Council gave strong backing to the Contact Group's efforts to achieve a negotiated settlement. The immediate need is for a durable ceasefire as a prerequisite to a successful negotiation.

"Finally, over dinner the heads of state and government had an informal discussion about the future development of the European Union, taking account of the need for further enlargement. That was the first such wide-ranging discussion that I can recall, and it was very welcome. I emphasised the Community's achievement in helping to bring 50 years of peace and prosperity to Western Europe. In squabbles over other matters that priceless achievement is often overlooked. I also commented that 40 years ago the founders of the Community had a broad vision of their objectives many years ahead and that those objectives had already been exceeded. Within a few years we shall have about 20 members and some time later perhaps as many as 27. The Union is changing beyond recognition. I said that it was time to rethink the Union's future constructively,

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and I set out the need for realism in the period ahead. That is essential if the European Union is to regain popular support.

"I do not underestimate the difficult tasks that the Union faces. But I was greatly encouraged by general acceptance of the need for flexibility and substantial changes so that the European Union can successfully meet the challenges ahead".

My Lords, that concludes the Statement.

3.47 p.m.

Lord Richard: My Lords, I am grateful to the noble Viscount the Leader of the House for repeating the Statement made by his right honourable friend the Prime Minister in another place.

On reading the communiqué of the summit, it seemed to me that, on the whole, it was a workmanlike rather than a dramatic one. For example, no major new initiatives were taken and there was no new grand course set for the development of the European Union; indeed, it was more a matter of building upon what had been achieved in the past in the hope that further progress would be made in the future.

At the outset I am bound to say that, on reading the communiqué and then the Prime Minister's Statement (which I received about five minutes before it was repeated in this House), parts of them seem to describe two different meetings. Faced with his own party in the other place, I can well understand that the Prime Minister may feel the necessity, so to speak, to gild one or two of the lilies or dress up some of the more difficult parts of the report.

I turn, first, to the section dealing with jobs and job creation. As regards what the Prime Minister said to the House of Commons and what the report actually says, the two are so diametrically opposed that I must tell the noble Viscount that when I was jotting down a few notes after reading the communiqué regarding the section dealing with employment—that is, not what the Prime Minister said—I actually wrote down the words:

    "Glad to see that the Government now endorse a more interventionist approach to investment, training and job creation".

I urge noble Lords to read the communiqué and not to rely on the one sentence that appears in the Prime Minister's Statement.

In the employment section the communiqué says that it was agreed:

    "The measures should include the following five key areas:

    Improving employment opportunities ... by promoting investment in vocational training.

    Increasing the employment-intensiveness of growth ... more flexible organisation of work ... a wage policy which encourages job-creating investment ... and ... the promotion of initiatives, particularly at regional and local level, that create jobs".

It continues:

    "Particular efforts are necessary to help young people ... who have virtually no qualifications, by offering them either employment or training ... The fight against long-term unemployment must be a major aspect of labour-market policy ... Special attention should be paid in the difficult situation of unemployed women and older employees".

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What the Prime Minister said about all that was:

    "Yet again the policies that we have been following in this country were widely accepted to be right for the European Union".

With great respect to the noble Lord the Leader of the House, what the Prime Minister said about that aspect of the communiqué is, frankly, a travesty of what seems to have been agreed. May I say a word about Northern Ireland—

Noble Lords: Oh!

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