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Lord Beloff: The word "statistics" was mentioned earlier in the debate on this amendment. What I believe people thought about at the time were economic statistics. However, as the eminent economists who normally grace the Labour Benches are none of them present today, I shall not embark upon something which would leave them disadvantaged in their absence.
I shall, therefore, talk about another kind of statistics which are much more immediately relevant; namely, the statistics of voting in yesterday's election in Saxony-Anhalt. It is important to notice that in a state in Germany--which still seems to have the untrammelled devotion of the noble Baroness, Lady Williams--over 12 per cent. voted for a Neo-Nazi party, while something like 40 per cent. voted for an ex-Communist party advocating the same policies as when the GDR was a Communist country. Commentators on those results have pointed out that the division there is one of age--the older people still hanker after the quasi-security of their former Communist regime but the younger people find that a little pathetic and go for Neo-Nazism. At whose expense have those votes been garnered? It is at the expense of the two governing parties in the coalition of the Federal Republic--Chancellor Kohl's Christian Democrats and their Free-Democratic partners, who did not even make the 5 per cent. necessary to be represented in the Land Parliament.
That has happened at a time when the German Government seem intent on bludgeoning Europe into a single currency. The fact is that in Germany a single currency, among other things, has not led to improvements in employment but to a kind of mass unemployment. That is the ultimate explanation of the electoral figures, as it was, in retrospect, probably the ultimate explanation of the rise of Hitlerism in the first place. It seems curious that this phenomenon is taken so little account of when we are considering a treaty which intends, in one way or another, to bind us more closely to an economy (and an outlook) that is proving to be such a massive failure. Even in prosperous western Germany the unemployment figures are still very high.
The point I wish to make is a simple one and one which I have already made in reference to this Bill and to the Maastricht Treaty before it. Europe consists of a
number of countries of a highly individualistic kind, each of them with their own preferences, their own convictions and their own ways of doing things. Any attempt to put them into a single system is bound, in the end, to run up against that simple fact. Attention has already been called by, I believe, the noble Lord, Lord Monson, to the French preference for protectionism as a way of securing employment. As it goes back for some 300 years, it is not surprising that they are attached to it. For reasons which I believe could be explained if we had the time, the Germans have the feeling that you somehow or other create employment by limiting the freedom of employers and exalting the influence of trade unions.In each of those countries there is something different. As my noble friend Lord Moynihan pointed out, we have a different approach. I do not expect for a moment that it is ignorance of that approach which prevents the Germans, the French, the Spaniards or indeed the Italians from adopting the British model; it is just not relevant to their situation as they see it. Surely it is important for a British Government to retain under their own control the basic instruments of economic policy. To do less than that is to betray the electorate to whom, at least in this country, government are responsible.
4.15 p.m.
Lord Stoddart of Swindon: I should like, first, to thank all those noble Lords who have sent their good wishes to my noble friend Lord Shore of Stepney. It is absolutely true that we are missing him very much today. We shall continue to do so tomorrow, but perhaps not on Report. I spoke to my noble friend's wife last night and it appears that he is quite ill in hospital. Nevertheless, he has taken a great deal of interest in what is going on. His wife hopes that he will be out of hospital on Wednesday, but it will be some little while before he can take part in our proceedings. I shall ensure that the good wishes of noble Lords are passed on to my noble friend.
My noble friend Lord Grenfell and the noble Baroness, Lady Williams, asked what this was all about. They said that it is only a bit of talk, the employment chapter is intergovernmental in its operation and, therefore, why not give them our ideas and why not listen to theirs? That is a seductive argument. However, the problem for me is that I have heard it all before and, after a little while, it becomes part of the ratchet effect towards a federal Europe.
We heard that foreign and security policy would be intergovernmental and that we were only going to have chats about such issues. Indeed, we were only going to discuss foreign policies. However, in this Amsterdam Treaty, the matter has been taken very much further than we thought it would be when we discussed Maastricht. It bears no relationship to the assurances that we were given about foreign and security policy during the debates on that matter.
The same is true as regards police and judicial co-operation which, again, is an intergovernmental pillar. Once again in the Amsterdam Treaty the question
is being taken further. More powers are being given to the institutions of Europe than we were led to believe would be the case when we discussed the Maastricht Treaty. That is what worries me about this employment chapter. Of course I do not mind discussing matters with our European competitors. I do not mind discussing them with anyone else in the world because full employment is a good objective. The Labour Party, which I joined 50 years ago, has always had that objective. Indeed even the Conservative Party came to accept it eventually. Of course full employment is a great aim and something which we should all support. However, I fear very much that the way in which the European Community works will not necessarily bring that about.I do not know how many noble Lords watched the programme on BBC2 on the way that EMU and a single currency were obtained. It was an interesting programme. It showed just how undemocratic the decision making process is and that ordinary people were never involved. When we talk about the people's Europe we are not talking about ordinary people; we are talking about the "top people" in Europe. It is the "top people's" Europe that appears to concern some people, not the real people's Europe.
Those who watched that programme would have seen exactly how two men stitched up EMU and a single currency over tea, like any potentate of bygone ages. It was not done through a democratic process. They had not even discussed the matter with their parliaments or assemblies. It was decided over a cup of tea. They made great decisions which affect people's lives, their employment or unemployment, without any reference to the people at all. That is why I am worried that although this new title may be intergovernmental, in the final analysis one or two people will make the decisions without reference to any democratic process. I am worried about the whole issue of EMU and a single currency because those people were not concerned about the economic aspects except in so far as they concerned France and its high unemployment rate. They were concerned about the political aspects. One could see how Germany and France between them were prepared to sideline and to "do down" this country.
If some of us are suspicious when matters such as Title VIa are drafted into a new treaty, please excuse us because we have been through all this before and it is a continuing process. Those are the reasons I believe we should be careful about this title and why I shall support, with alacrity, the amendment in the name of my noble friend Lord Shore whom we all wish a speedy and good recovery.
Lord Moynihan: I mentioned earlier that I thought it was critical to address the questions posed by the social chapter. I do so now with renewed vigour. I am always cautious when I listen to the noble Baroness, Lady Williams, because I think it is fair to say that we agree on many aspects of foreign affairs, but on this subject we disagree most vehemently. We take a polarised position in that disagreement, save possibly as regards the importance of compassion in politics. I hope she will accept that I believe equally in the importance
of compassion in politics and see it being achieved best by satisfying the primary concern expressed by the noble Lord, Lord Renton, of creating employment and providing individuals with jobs. The statistics I mentioned when we focused on the employment measures were endorsed by those of us who are involved in politics and in business who also recognise the importance of compassion in terms of creating jobs and creating a healthy economy.I believe that true compassion is effectively expressed in phrases such as that used by Hans Olaf Henkel, President of the Federation of German Industries, when he pointed out that,
- "Great Britain has become the most attractive location for investment in Europe".
For it is governments who create the right legal, regulatory and fiscal framework to ensure maximum efficiency, creation of jobs and competitiveness. That is an important part of compassion. From these Benches our position has been unequivocal and constant. We were simply not prepared to accept the social chapter proposed at Maastricht because it opens the door to unwanted regulation which threatens to damage our competitiveness and destroy jobs.
The Government have given many reasons why they signed up to the social chapter. We have been told repeatedly that our opt-out was damaging and that it insulted British workers. The Foreign Secretary said,
- "We have ended the insult to the British people that they are fit only for the worst rights at work in the whole of Europe".--[Official Report, Commons, 12/11/97; col. 912.]
How can he possibly claim that to be accurate when set against the relative success of our economy and the compassion in creating so many jobs through our productivity over the years? In my view those words of the Foreign Secretary are hollow indeed. We were told that it was essential that we signed up to the social chapter if British workers were to have the same rights as those in Europe.
I understand the point made by the noble Lord, Lord Grenfell, that the Minister in another place sought to embrace the same rights as those in other countries in Europe already have. I am in complete agreement with him on the importance of dialogue, but I do not believe for one moment that it could not take place in a constructive manner without signing up to the social chapter. We were also informed that our opt-out reduced our influence in Europe and that we needed a seat at the negotiating table. Of all the issues that we shall debate in Committee this is possibly the most important one. I recognise that this is a subject that appeared in the Government's manifesto. It is not my intention to seek to divide the Chamber on this issue at any stage because I recognise that this Chamber has accepted that we do not challenge manifesto commitments, particularly one that was expressed so strongly by the then Labour opposition.
However, during all the "door knocking" and canvassing that occurred during the previous general election, I did not come across a single voter who decided not to vote for the Conservative Party because of the Government's intent with regard to the social
chapter. I may be unique in that and other Members of the Committee may have had a different experience. I should like to know in what way our opt-out from the social chapter was damaging. What are the benefits that our opt-out from the social chapter has denied us? What is the injury, the damage, the detriment that the opt-in agreed at Amsterdam is supposed to rectify? Did our opt-out mean that jobs were lost? No, on the contrary. Did it threaten our economic success? No, on the contrary again. Were we ever at risk of unwanted and possibly job-destroying legislation imposed on us by qualified majority voting? The answer is clearly not; on the contrary.It is disingenuous for the Government to say, as the Minister said in Committee in another place, that the social chapter is,
- "not only about what can be agreed at a European level; it is also about recognising that some things are better dealt with at a nation state level. When the Government judge that that is the case ... we are determined to make it the case that those matters are determined at a national level".--[Official Report, Commons, 3/12/97; cols. 436-437.]
But that is patently untrue. The Director-General of the CBI put it best when he said:
- "If you sign up to the social chapter you can't actually be sure that you'll have your way because some directives will be covered by qualified majority voting. There is, however, a way to pick and choose, and that is available to the Labour party if it wants to have it as its policy. The way to pick and choose is actually not to sign up to the social chapter".
The directives covered by QMV mean that the Government would be powerless to prevent some measures being imposed on the United Kingdom against its will. This threat has already become a reality before the social chapter has even been put in position; it does not become active until the Treaty of Amsterdam is signed.
Yet the reality has been shown, because Commissioner Flynn has proposals to extend the works council directive to companies with 50 workers and above which, if successful, would be introduced under the QMV sections of the social chapter, with no chance of a national veto.
The Government oppose these proposals to extend compulsory works councils. Yet, as the CBI business update says:
- "the Government has stated that it shares our reservations, but it can be overruled since this is one aspect of Social Chapter legislation which can be covered by QMV".
How will the Foreign Secretary guarantee to ensure, as he has promised, that the Commission's proposal for all such legislation with which the Government disagree is amended? Will he give the same answer as the President of the Board of Trade, who told the BBC's "On the Record" programme that she did not support Commissioner Flynn's proposals for national works councils; but, when asked what action the Government would take to prevent the proposals for national works councils becoming law, she could only manage to stumble:
- "Well, er, we shall see how things go".
How will the Government pick and choose between those social chapter policies which suit them and those which do not if they, and indeed many policies, can be
introduced under QMV? When summing up, can the Minister guarantee that such a measure to introduce national works councils, if the Government proved powerless to prevent it, would not be damaging to the interests of the 3.7 million small British businesses and the entrepreneurs who run them who risk their all to make their businesses a success and who do not have the resources to pay for the personnel departments and the compliance officers?The noble Baroness, Lady Williams, was right to underpin the importance of social legislation, and I echo those sentiments. But we have a Parliament in which we can consider each possible measure that we deem necessary in this country to protect workers. I have a list, with which the Library have generously provided me, with hundreds of measures appropriately considered by Parliament and passed for this very purpose, and on which I have full agreement with the noble Baroness. But, under the social chapter, legislation in any of these areas--working conditions, the information and consultation of workers, equality between men and women in relation to both employment opportunities and treatment at work, the integration of people excluded from the labour market and health and safety at work--can be introduced under QMV and the Government would have no power to stop such legislation.
There will be noble Lords on both sides of the House who will say that these seem reasonable areas for proposals. But let us look at them. Proposals under working conditions, the first I cited, which could not be vetoed if they are adopted, include the requirement for firms to provide equal rights for permanent and temporary workers, which is already a European Community proposal; no more flexibility in employing temps or casual workers; the requirement for firms to provide full employment rights for all workers--no more probationary periods and full redundancy costs; and the requirement for firms to provide full pay for every day of sickness, as in Germany, which could lead to an increase in sickness absenteeism. All these are measures which have been considered in both Houses of Parliament and all are measures which we do not wish to see imposed upon us, even if they are right for other members of the European Community.
My second area relates to proposals under information and consultation of workers, which could not be vetoed if they are adopted. I mentioned works councils for all firms with more than 50 employees. There is the obligation to consult elected representatives--in other words, trade union officials--over every management decision--recruitment, redeployment, redundancy; the requirement for co-decision between a company's management and works councils, as in Austria--firms will have to gain the agreement of the works council before every dismissal decision; the requirement for all firms to reserve up to half the seats on their boards of directors for duly elected representatives of the workers; the requirement for firms to apply to the government for permission before making any dismissal or redundancy, as in the Netherlands.
These are not pie-in-the-sky ideas; I am quoting specific examples which occur elsewhere in Europe and which, no doubt, those countries would like to see universally applied throughout Europe. They deemed the measure satisfactory for them; why should they not propose it within the social chapter to be satisfactory for the whole of the community and push, through QMV, for it to be adopted?
We may say in this House that we do not feel it is right for the United Kingdom. We had the opportunity when we had the opt-out to consider the social legislation appropriate for this country. But that will not be the case in future on proposals as regards the equality of men and women in relation both to work opportunities and treatment at work, which could not be vetoed if they are adopted. On sex discrimination, the European Community proposal would require employers to prove their innocence instead of being innocent until proved guilty, overturning what we consider to be a basic principle of justice; there is requirement for positive discrimination in favour of women in the workplace, with quotas for both female directors and management; and, for example, the requirement for firms to provide all workers four weeks' holiday a year from 1999; the requirement to provide all workers six weeks' holiday a year, as in Spain, which is what Spain believes to be in its national interest and, if it persuades the majority in the Community, the measure could be extended throughout; the forbidding of any worker to work more than eight hours a night on a nightshift, as per the working time directive; and the forbidding of any worker from working more than 40 hours a week, as in France and Belgium, adding further costs and inflexibility to business limitations on overtime.
It is Jacques Santer's opinion that there should be more QMV in the social chapter. He wrote to the effect that he believes that it is essential to extend qualified majority voting to certain provisions of the social chapter which currently require a unanimous vote; namely, to the protection of workers whose employment contracts have been terminated, the social security and social protection of workers and the representation and collective defence of the interests of workers and employers.
The Government say that we are scaremongering. As has been pointed out this afternoon by the noble Baroness, Lady Williams, the two directives introduced under the social chapter to date--the European works council directive and the parental leave directive--have been modest, sensible and reasonable. But that fails to take into account the fact that the danger is not what has already been introduced under the social chapter, but the potential for more increasingly far-reaching social legislation. I have given many national examples in support of my argument on this vital issue. The fact that we had an opt-out acted as a brake on the development of the social chapter. How can the noble Lord, Lord Whitty, guarantee his words, echoed in another place, will remain true in the future? He said that,
- "None of the provisions in the social chapter, likely or actual, impose serious costs on British business".--[Official Report, 28/7/97; col. 68.]
Furthermore, surely our past experience suggests that European Union institutions, including the European Commission and the European Court of Justice, will seek to apply the widest possible interpretations in order to maximise the scope for adopting measures by qualified majority. Hence, the European Union's working time directive was imposed on Britain on the grounds that working time concerns health and safety rather than employment. The Department of Trade and Industry calculated that the working time directive could cost British employers £2 billion.
The noble Lord, Lord Beloff, focused on what is surely the most important issue. After all, what is wrong with a domestic agenda for social legislation? If the Government deem it essential that British workers have the same rights as their counterparts in Europe, why do the Government not introduce employment and social policy measures which they believe will boost employment in Britain through domestic legislation and avoid the risk of the imposition of unwanted and damaging legislation under the social chapter? From those--
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