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Lord Tebbit: My Lords, the noble Lord should not be allowed to get away once again with this piece of absolute nonsense of comparing NATO and the European Union. Can NATO legislate over the head of this Parliament? Does NATO have a supreme court? Does NATO even interfere in whether one should compensate, and in what sort of manner, and provide legislation over sexual discrimination in the Armed Forces of NATO? No, no, no and no in every respect. They are totally and completely different even to the extent that NATO has a provision within it for the renunciation of the treaty, and the Treaty of Rome has no such provision.

Lord Wallace of Saltaire: My Lords, I recognise the noble Lord's quotation from the noble Baroness, Lady Thatcher. May I remind him that NATO has a common budget and command structure. There is also a common services budget to which all of us make our own proportionate contributions. As regards subsidiarity and proportionality, we have a problem throughout the European Union.

Lord Stoddart of Swindon: My Lords--

Lord Wallace of Saltaire: My Lords, I have given way a great deal--

Lord Stoddart of Swindon: My Lords, I am most obliged to the noble Lord for giving way. Does he agree that the great difference between the European Union, as it involves sovereignty, and NATO is that votes are taken by consensus and not by a qualified majority? That is the difference.

Lord Wallace of Saltaire: My Lords, I entirely agree with that. I am conscious of the fact that at one point last year the majority of NATO members were in favour of enlargement to include Romania and Slovenia. The United States was against that and a decision was taken as the United States wished. If that is a definition of consensus, which we all have to accept, in effect that is how NATO operates. Let us not be too silly in how we define these things.

In terms of subsidiarity and proportionality, I strongly support what my noble friend Lady Williams has said. We have gained a great deal. Of course, we are in a political process in which each government and each national public wants to tell people in other countries what to do, but not to be told what to do within their own. We have pressure groups in this country who are anxious that the European Union should take steps to ban bull fighting, but not to interfere with the right to hunt foxes. It is a normal process in which we all have to play our part.

I strongly support the proposals which this Government should be pressing further, to reform the Commission and to cut down the number of different Directorates-General. I believe that there are still too many things which come out of the directorates with

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numbers above 20 which push forward their proposals. But the majority of proposals which come from the Commission have been started by one government or more which wanted to push something on to the European Union agenda. It is not the case that Britain is against all the other 14 governments. Other governments are also concerned about subsidiarity. My wife and I wrote a paper for the Dutch Government two years ago on the principle of subsidiarity and how to apply it. I have also been involved in a Finnish study on how we implement the principles of subsidiarity.

Perhaps I may remind the noble Lord, Lord Tebbit, that my party wishes to see the principles of subsidiarity and proportionality applied within the United Kingdom as well as at a European level. We see this new Government setting out rather hesitantly and being unsure how they wish to apply the principles of subsidiarity and proportionality to Scotland and Wales let alone restoring power to local government. This clause is not necessary. We have made quite good progress, but it is a political process which we need to continue.

Earl Russell: My Lords, I listened with care to the noble Baroness, Lady Park of Monmouth, making the case about NATO. I have heard it many times before. I understand very well that that is the way things work in normal times. But it is of the essence of decisions about peace or war that they may sometimes fall to be made in what are not normal times. In fact, warnings of possible nuclear attack, hypothetically, and possibly not only hypothetically, might fall to be made within as little as four minutes. The amount of consultation that one can do within that space of time is necessarily limited.

I concede to the noble Lord, Lord Tebbit, that NATO is not about to require us to have gay soldiers. But much as I understand that the noble Lord, Lord Tebbit, minds the prospect of gay soldiers, even he might possibly mind total annihilation just that little bit more. The power of war and peace is the most supreme mark of sovereignty and is even above the power to make law. Necessarily, where there are nuclear weapons, in an emergency that cannot be a matter for consultation between all the governments concerned in an alliance. That is why I believe my noble friend Lord Wallace of Saltaire has been making a very valid point.

Lord Tebbit: My Lords, we stray, but I shall not stray very far. The noble Earl knows perfectly well that the nuclear weapons of the United Kingdom remain subject to the requirement of the dual trigger. What he forgets is that day after day after day, the liberty of the people of these islands is being eroded through the European Community. It was not NATO, which is responsible for our defence, which required this House--without option--to enact an amendment to the Sexual Offences (Amendment) Act 1976. That is the extent of the subsidiarity argument. It is subsidiarity that we are arguing about today.

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1.30 p.m.

Lord Moynihan: My Lords, I shall resist the Liberal Democrat temptation to be drawn into the all too clear debate of the distinction between NATO and the European Community. I wish to focus very briefly on the subject of subsidiarity and how far we got with it in Committee. Key points on the subject were left unanswered at that stage. It will be helpful to the House if they can be clarified this afternoon. It is already beginning to feel like this evening! In so doing, I shall attempt to persuade the noble Baroness, Lady Williams, that neither this amendment nor my position is strange or perverse. I hope that I succeed.

In Committee, we had a long and interesting debate about the way in which European law is made, touching on the whole complex question of European Union law-making and who is ultimately responsible for it, as well as on the qualified success of the principle of subsidiarity in general and, more specifically, on the effect that the new protocol on the applications of the principles of subsidiarity and proportionality contained in the Amsterdam Treaty will have on that success.

Perhaps I may take this opportunity to reiterate the Opposition's support for the principle of subsidiarity. Decentralised decision-making is at the very core of what we believe is the best vision for Europe--a vision of a partnership of nation states in a competitive, decentralised and efficient Europe.

From these Benches, we welcomed the commitment of the noble Lord, Lord Whitty, to the concept of devolved law-making in the Union and to ensuring that it works effectively, as well as his confident assertion that this protocol will help the law-making to work better. I thank the noble Lord for acknowledging the importance of the principle and for the recognition that it was the previous administration's initiative which led to proposals being brought forward to entrench subsidiarity further into European decision-making, and his acknowledgment that before Maastricht there was no general presumption in favour of action at national level contained in any of the treaties.

The recognition of the need to reinforce this presumption established at Maastricht led to the decision to include in the Amsterdam Treaty elements of the detailed rules for the application of subsidiarity, which had been agreed at the 1992 Edinburgh European Council.

From these Benches, we also echo the need for further clarity on how subsidiarity should be applied, as pointed out by my noble friend Lord Renton. That seems to be the key issue today because clarity has not yet emerged on this question. In this context, I raised in Committee some issues about the unsatisfactory nature of the wording of the new protocol, in particular paragraph 2, and I expressed fears that despite the new protocol's length, far from strengthening this important principle to ensure that the European Union makes laws only when individual member states are not better placed to do so, it will, in fact, weaken it.

I welcomed the noble Lord's assurance that the application of the principle of subsidiarity has not taken a backward step, thanks to the complex Protocol 7, but

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I still have important questions about the assertion that subsidiarity has become a more effective safeguard as a result of the Government's negotiations at Amsterdam.

I compared the effect of the general principles of subsidiarity and proportionality, as set out in Article 3b of the Maastricht Treaty, which was the first step towards establishing the principle, which the Amsterdam Treaty was then intended to reinforce, with the potential effect of paragraph 2 of Protocol 7. That paragraph makes the concept of subsidiarity subject to the acquis communautaire, the European Court of Justice and Article F(4)--those very principles, pillars and institutions that created the supranational activity in the first place. The noble Lord, Lord Grenfell, believes that the protocol simplifies and clarifies the position. It does not do that for me and I am glad that we have this opportunity for the Minister to respond on this point.

Far from clarifying and tightening the application of subsidiarity, I believe that this key paragraph, paragraph 2, could ensure that the sum effect of the protocol is that the principle of subsidiarity will mean what the Council, Commission and Court of Justice intend it to mean at any one time. Therefore, the concept of subsidiarity will be held hostage to the way in which the institutions--the ECJ in particular--choose to interpret the confused and contradictory provisions of the protocol. It is that specific point which brings me to the Dispatch Box this afternoon in order to seek clarification from the Minister.

I take on board the important points that have been made in this debate about the role of the former Prime Minister, John Major, in pursuing the important issue of subsidiarity. I hope that the questions that I have posed do not in any way undermine the respect that I have for his important work on that issue. Indeed, that is why I sought reassurance that the Government would ensure that paragraph 2 does not prove to be a fertile ground for the centralising tendencies of the European Court of Justice, which will be able to interpret the protocol according to its vision of, and attitude towards, European Union development. If not, the Government will run the risk of giving free rein to dominance by the institutions of the European Union, which will serve to confuse and undermine the principle.

The noble Lord responded to the legal points that I raised in Committee, but I should like some further clarification. The noble Lord said that, as regards subsidiarity, "ultimately" there must be a role for the Court of Justice, but that it would be a "longstop" role. The noble Lord further expressed his confidence that the European Court of Justice would implement the protocol effectively in line with the general view across the European Union that the principle of subsidiarity has to be enforced, and that, "in the last resort" the ECJ will be better able to ensure that the subsidiarity principle is properly applied on the firm legal basis of the explicit protocol written into the treaty. Perhaps today the noble Lord will elaborate a little on that point and reassure the House that that "longstop" role will not lead to the Court of Justice effectively becoming the arbiter of what is, or is not, subsidiarity and proportionality.

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I conclude by saying that we welcome the Government's recognition of this very important principle. From these Benches, we shall strongly support them in the efforts they make to find new ways to ensure that the definition of "subsidiarity", which the previous government pioneered, is effectively followed by the institutions of the Community. This amendment, formally requiring such a report to Parliament, would be a beneficial step towards that objective, adding significantly both to the body of knowledge available to both Houses and to keeping Ministers of the day on their toes and yet more accountable to this Parliament.

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