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Baroness Symons of Vernham Dean: I do not think that it is too complicated. I hope that I have understood what my noble friend asks. The abstention is what we have called a constructive abstention, which does not impede the actions of others to act if they feel they wish to do so.

My noble friend gave an example which I believe is fundamentally flawed. In that position we would not have constructively abstained. We would have either

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vetoed the common strategy--I believe that the real issue would have arisen at that point--or we would have pulled the emergency brake at a later point. Therefore, on both points my arguments remain that we would have, in effect, had a veto.

I hope that I can reassure the noble Lord that we would have had the freedom to act in the way we did after the ratification of the treaty. I hope that I have assured him on that point.

Lord Tebbit: I am grateful to the Minister for giving way. She has dealt well with the point raised by the noble Lord, Lord Stoddart. However, let us suppose that the last administration had, like President Bush, gone wobbly. Let us suppose they had agreed, and there had been a unanimous agreement within the Council, that force should not be used against Iraq. Of course, subsequently, there was the general election and the present Administration are most robust, have given great support to our American allies and would have wanted to change the policy. In exactly what way would that have been possible? Or would the incoming Government have been locked in to the policy of the preceding government?

Baroness Symons of Vernham Dean: Like any international obligation, such obligations are binding, not on the government of the day, but on the state, as I am sure the noble Lord is well aware. However, there is an important point here. Most CFSP instruments reflect the rapidly changing nature of foreign affairs. They are therefore generally time-limited to six months or a year. Indeed, Articles J.3 and J.4 require common strategies and joint actions to specify their duration.

Perhaps I may now turn to the instruments. I hope my remarks will shed a little more light, even though the noble Lord shakes his head. Article J contains two useful CFSP instruments. The first is the common strategy. This will be a more formal vehicle for the existing European Council practice of setting guidelines on foreign policy. It will give important common policies more weight on the world stage. It is given the same degree of definition as joint actions were in the Maastricht Treaty.

The noble Lord, Lord Moynihan, asked for a definition of a common strategy. The common strategy must set out objectives, duration--an important point for the noble Lord, Lord Tebbit--and the means to be made available. In other words--and again this is important in respect of the issue raised by my noble friend Lord Stoddart--we can insist on a common strategy being as precise as we want. In practice, common strategies are unlikely to be very different from existing joint actions. Both the preparation of, and the decision on, common strategies are by unanimity. So we have an independent control of the process.

Secondly, we pressed successfully for a new provision, Article J.4.4, for the Council to request the Commission to submit proposals in support of CFSP common measures. We believe that that will help ensure better coherence in external economic and political activities. However, as I indicated previously, such a request does not confer exclusive rights of initiative in

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CFSP upon the Commission. I say that most emphatically to my noble friend Lord Bruce of Donington.

Turning to institutions, we negotiated at Amsterdam three useful additions to CFSP institutions: first, double-hatting the secretary-general of the Council secretariat as High Representative for CFSP. That will improve the representation and visibility of CFSP. The High Representative will add to existing representational capacity, reduce the burden on the presidency and the troika, and help ensure continuity from presidency to presidency in contacts with third countries. He will ensure better coherence within the secretariat of external economic and political activity.

I assure the noble Lords, Lord Moynihan and Lord Stoddart, however, that the High Representative will not be an independent EU Foreign Minister. The treaty makes clear that he or she will be accountable to, and the servant of, member states in the Council. So CFSP remains firmly under member state control and the presidency in the lead on the management of it. I hope that that answers the specific point made by the noble Lord, Lord Moynihan, in winding up.

Secondly, Amsterdam creates a new deputy secretary general to relieve the new secretary general high representative of many of the current secretary general's duties, and so make time for his new CFSP duties. Thirdly, it adds a new policy planning and early warning unit to the CFSP resources of the secretariat. This will help sharpen the preparation and the focus of policy options put before the Council.

We also successfully negotiated improved financing arrangements. CFSP expenditure will normally be borne by the Community budget rather than by member states. Under Maastricht, the European Parliament was able to place CFSP funding in the reserve, so allowing it to block or amend Council decisions on the financing of individual CFSP actions. The inter-institutional agreement we negotiated at Amsterdam prevents that happening.

The noble Lord, Lord Bruce of Donington, asked what the CFSP budget is used for. There are 30 mecu or about £20 million in the budget for 1998. Member states in the Council of Ministers can choose to use this to fund common foreign policy activities under five main headings. First, there is support for democratic transition and electoral processes, as we did in 1995 for the Palestinian elections, and in 1996 and 1997 in the former Yugoslavia. The second is disarmament, including funding for demining activities and support for victims of anti-personnel land-mines, as we have done since 1995. The third heading is special envoys, providing funding as necessary for the EU special envoys to the Middle East peace process and the Great Lakes region.

The fourth heading is prevention of conflicts and support for peace processes. This year, the budget has been used to provide 6 mecu in rapid short-term assistance to the new Dayton-friendly Republic of Serpska Government in Bosnia. Last year it was used to provide funding for counter-terrorism training for the

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Palestinian Authority. It is also used to provide support, as necessary, for the office of the high representative for Bosnia and Herzegovina. The fifth is to fund common foreign policy action in response to any emergency.

Like my noble friend Lord Grenfell, I have been amazed during this debate at some noble Lords' sheer inventiveness in trying to turn what he described as "modest mice into woolly mammoths of evil disposition". I will deal with one or two of the modest mice or evil mammoths. First, the noble Lord, Lord Renton, referred to the dropping of the reference to "member states" in Article J.1. That merely recognises that when member states act collectively it is by definition as the Union. Perhaps I may point out to the noble Lord, Lord Moynihan, and my noble friend Lord Stoddart that this is the same drafting as that employed in Article J.1.3 of the Maastricht Treaty. There is nothing new or particularly alarming in it.

Secondly, member states have shared confidential information with each other ever since European political co-operation first started in 1970. The noble Lord, Lord Moynihan, was worried about sharing of intelligence reports. Common policies are based on common analyses which must start from a common information base. We are putting in place arrangements to ensure security vetting of secretariat and policy planning unit staff. However, it remains entirely at the discretion of the individual member state what information that state chooses to share. So I reassure the noble Lord, Lord Moynihan, that the UK's defence intelligence relationship with the United States is not affected. Indeed, we would not allow it to be affected.

Thirdly, Article J.9, mentioned by many noble Lords, is unchanged from the provisions negotiated by the last government in Articles J.2.3 and J.5.4 of the Maastricht Treaty. The UK would have to agree to any common position before being required to uphold it in any international forum. The Government also welcome the continued explicit acknowledgment in the treaty that the UK and France, as permanent members of the UN Security Council, have independent responsibilities under the UN Charter.

Fourthly, the EMU stability pact would not prevent us from going to war if we wished. The noble Lord, Lord Hamilton of Dalzell, suggested that any such foreign policy adventure would imperil our budgetary position, putting us in breach of the pact.

I am pleased to be able to assure the noble Lord that deficits over 3 per cent. of GDP will not be judged excessive or incur penalties under the stability pact if they are exceptional and temporary. The relevant regulation makes clear that exceptional and temporary deficits include those resulting from unusual events outside the control of the member state concerned. That description would fit any military action which any EU member state is likely to want to undertake nationally.

Lord Shore of Stepney: I am sorry to interrupt my noble friend. In considering that point, as she will know, the ways and means facility available now to the Treasury is to be repealed as part of joining the European Central Bank and EMU. If that ways and

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means facility is withdrawn, and with it the Government's ability to borrow from the markets at will, will it not be the case that we would then need the consent of the European Central Bank?

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