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Lord Grenfell: My Lords, does my noble friend the Leader of the House agree that perhaps my noble friend Lord Shore would be able to avoid some of his nightmares about a United States of Europe if he were to remove Mr Joschka Fischer's speech from his bedside reading and not read too much into it, particularly when most of the 15 member states do not seek a "United States of Europe" but a "united Europe of states"? That makes a great deal more sense.
Having said that, I congratulate my noble friend on the highly significant and successful result obtained on the withholding tax. It is a major step forward after, as she rightly pointed out, the United Kingdom had been in a very isolated position.
I am pleased that the European Council has recognised the problem that Austria will have with the amendment of its constitution in order to remove banking secrecy. Does my noble friend welcome the fact that a seven-year period of grace has been accorded to both Austria and Luxembourg in which to change their banking secrecy laws.
Finally, is my noble friend aware that there is talk of a Portuguese presidency initiative which includes proposals for monitoring the policies and actions of the Austrian Government in place of sanctions? If that is so, can she assure the House that Her Majesty's Government would welcome this? In my view, it is
Baroness Jay of Paddington: My Lords, I am grateful to my noble friend Lord Grenfell for raising the point of the Portuguese initiative. I apologise to the noble Lord, Lord Strathclyde, who specifically raised that issue in his initial comments. He asked whether there had been any further action in relation to Austria after the Feira summit, and I am afraid that I simply forgot that in responding to him.
My noble friend Lord Grenfell is right. Although there was no substantive discussion on this issue at Feira, it was understood from the presidency that Prime Minister Guterres would be in contact with the Austrian Government--we hope by the end of this month--in order to raise some of the issues mentioned by my noble friend. As I say, because there was no substantive discussion of this issue at the Feira conference, it would be premature to say what the hypothetical outcome of that kind of communication or contact with the Austrian Government will be and, therefore, whether the British Government would welcome the outcome. As to the mechanics, it is true, and obviously welcome, that Prime Minister Guterres is taking this initiative.
As to my noble friend's other point, he is right to raise the question of the difficulties surrounding the speech to which he referred. I was present in the House on an earlier occasion when my noble friend Lady Scotland referred to that speech and emphasised to the House its unofficial and personal nature. I know that that did not necessarily reassure some Members of the House on that occasion--it probably will not again today--but I underline once more what both my noble friends Lady Scotland and Lord Grenfell have said on many occasions--that a "united Europe of states" is the worthwhile objective, not a "United States of Europe".
Lord Pearson of Rannoch: My Lords, does the noble Baroness accept that it is a measure of how deeply we have become involved in this whole perilous European venture that we should regard the kicking into the long grass of the entirely destructive and senseless proposal of the withholding tax with such relief? In that respect, can the noble Baroness assure the House that the rest of tax harmonisation--which, as she knows, is "Eurospeak" for British taxes being increased by some 20 per cent--is now firmly off the agenda, both at Nice and in the related initiatives which are running parallel to Nice?
Baroness Jay of Paddington: My Lords, as your Lordships are well aware, the noble Lord, Lord Pearson, takes a particular constitutional stance on this country's position vis-a-vis the European Union. Indeed, I think it is true that he has introduced legislation in his name to try to effect that. Am I right? The noble Lord looks sceptical. I give way.
Lord Pearson of Rannoch: My Lords, in 1997 your Lordships' House was good enough to give a Second Reading--by two votes in a record vote on a Friday afternoon--to that effect. But the Bill which is passing through your Lordships' House at the moment has the entirely reasonable purpose of requiring a committee of inquiry to consider what life may be like outside the European Union.
Baroness Jay of Paddington: My Lords, in that case the noble Lord, Lord Pearson, deals in hypotheticals to some extent on this issue. In practical reality, of course, the directive has been agreed around some of the issues on the exchange of information rather than the withholding tax. The noble Lord feels that that is an indication of the mire in which we find ourselves, but he was kind enough to say that we had at least extricated ourselves from this particular mire with some degree of dexterity.
I am sure that the noble Lord is aware that this directive is not about with tax harmonisation; it reaffirms that it is for member states to decide how their residents' income should be taxed. So the issue of tax harmonisation--although it was a potential answer to this particular issue--does not arise, either hypothetically or in practice, in this instance. The noble Lord, of course, will be aware that the British Government have always taken a very firm position on tax harmonisation, which the Chancellor of the Exchequer reinforced at this conference. His leadership skills in achieving this agreement on the withholding tax have demonstrated his authority in this particular field.
As to the other point raised by the noble Lord, I refer him to the detailed discussions which took place in your Lordships' House last Friday--I know he took part in the debate--on the potential implications of a declaratory charter. A number of notable jurists, including those who are members of the convention on the charter, also took part, and no clear apprehension was shown by the people most directly involved about the kind of scenario suggested by the noble Lord. Some of them are distinguished jurists, and I would rest on their opinion.
(a) the Authority; or
(b) the holder of a gas licence or an electricity licence,
to supply to it, in such form as it may reasonably specify, such information specified or described in the direction as it may require for the purpose of exercising its functions.
(2) A person to whom a direction under this section is given shall comply with it as soon as is reasonably practicable.
(3) Before giving a direction").
Page 21, line 43, leave out subsections (6) to (11) and insert--
("(6) If the Authority fails to comply with a direction under this section it shall, if so required by the Council, give notice to the Council of the reasons for its failure.").
Page 22, line 19, at end insert--
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