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Lord Shore of Stepney: My Lords, before my noble friend moves away from this point, in their response to the committee the Government have said already that we should be very wary indeed about making any changes in the existing rules--including the emergency break--that presently govern flexibility. In the light of the really basic importance of this, can my noble friend be a little firmer and stronger and say that the Government will veto, if need be, changes here and will not be blackguarded into saying "If you do this you are going to hold up enlargement"?

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Baroness Scotland of Asthal: My Lords, I can certainly reassure the noble Lord that in those areas--I shall return to them later--where we have made clear that the veto remains, it will remain. However, it is right for Her Majesty's Government to look at the issues as they arise and deal with them in the most appropriate way. I emphasise the importance, for example, about getting agreement in relation to the rules of the court: we wanted that; we got it; and it is good for us and for Europe.

I recall the siren call of those in February who predicted a far more sprawling IGC. I am sorry to have to disappoint them. We have stayed on track. With this platform we can now use the past two-and-a-half months of the conference to find lasting solutions to the key IGC issues, all of which have been touched upon by virtually every noble Lord who has spoken today.

The first of those issues rightly concentrated upon was Commission size. I believe that my noble friend Lord Grenfell, with his usual erudition and style, dealt first with this issue. He was subsequently followed by many other noble Lords. As at Amsterdam, we believe that it is in the interests of a more efficient Commission that larger member states should be prepared to give up their second commissioner when the EU enlarges, provided that a satisfactory agreement is reached on the reweighting of votes in the Council.

Some speakers today suggested that one commissioner per member state is already a fait accompli. My noble friend Lord Borrie, the noble Viscount, Lord Bledisloe, and the noble Lord, Lord Roper, were particularly exercised about this issue. With satisfactory vote reweighting, it is something that we could accept. But it is by no means settled. As other noble Lords said, we must bear in mind that it could still lead to a Commission of 27 or 28 in the future. With that in mind, we also have to look carefully at other options. We recognise the argument for every member state having a commissioner. However, we cannot rule out an eventual cap on the size of the college. We shall certainly consider the possibility of internal restructuring; for example, by varying the number of vice presidents. But I should emphasise at this stage that, as this debate illustrates, there is much to take into account before coming to a definitive view.

No one is suggesting that the voting system in the Council should become entirely proportionate to population, but we are looking at substantial reweighting in favour of the more populous member states--to ensure that they have the right degree of influence and as compensation for the loss of their second commissioner. We have not decided on the means of achieving this. The committee and a number of noble Lords called for a dual or double majority system. We do not rule out a two-pronged system of votes, plus a separate pure population element. But we should prefer a simple reweighting of votes, as with the current system, which gives more weight to population. We believe that that has the advantage of being clearer. However, as I said, it also reflects the dual nature of the Union. No one is suggesting that

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simple, weighted votes should become entirely proportionate to population. They should also continue to reflect statehood.

As I am sure the House is aware, 80 per cent of Council legislation was adopted by qualified majority voting in 1996, even before the Amsterdam Treaty came into force. So it is not surprising that the room for further manoeuvre is limited. Since the White Paper on the IGC was produced in February, the Government have made clear that they will insist on unanimity for key issues of national concern. The examples given in February remain today: treaty change, own resources, border controls, taxation, social security and defence. I hope that my noble friend Lord Grenfell will be reassured when I say that in other areas we support the case by case approach adopted by the Portuguese presidency and now taken up by the French. This is the only sensible way to proceed if, as they should, member states are properly to weigh up the pros and cons of qualified majority voting in each instance. There has been little agreement so far and I am sure that there are a few Members of your Lordships' House who would see this as a good result. But I am confident that by Nice the conference will produce a sensible extension of QMV where it is justified in the interests of efficient Council decision making.

The Government recognise that, especially in an enlarged EU, there may be occasions when it is sensible for a group of member states to co-operate more closely than others. However, as the noble Lord, Lord Roper, and others have said, we are wary of altering too much the conditions and procedures agreed at Amsterdam. These conditions were carefully designed to allow for flexible decision making but they also protect the interests and obligations of individual member states and the coherence of key policy areas such as the single market. Such safeguards are important, especially in the context of enlargement.

At the moment it is ,in our view, up to the advocates of change to demonstrate where closer co-operation might usefully be employed and how this could not be achieved using the current provisions. As the committee pointed out in its report, and as the noble Lord, Lord Tordoff, reiterated today, no such concrete proposals have yet been put forward. As a result, we remain cautious about any major change. We have charted a prudent course. I can assure noble Lords, particularly my noble friend Lord Grenfell, that national intransigence will not prevail over common sense.

I could not but agree with the comments made in the splendid speech of the noble and learned Lord, Lord Howe, as regards the disappointing approach adopted by members of the Tory Party in relation to these issues and with the caution that he gave us against the intemperate use of rhetoric to mislead the British people when looking at these issues. There is a gap between rhetoric and reality; it should be bridged. I reassure the House that Her Majesty's Government are bridging that gap and are doing so successfully, if I may respectfully say so.

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The views of some members of the Tory Party that I have mentioned have nothing to do with the closer co-operation provisions currently in the treaty, nor with suggestions put forward by any other member state in the IGC. It is totally unrealistic to suggest that others would allow the United Kingdom or any other country to opt out of individual directives that are intended to apply across the EU. That would be non-negotiable at the IGC.

It would be equally impossible to distinguish between what is a core single market issue and what is not. Important single market barriers are indirect; for example, social legislation, consumer protection rules and environmental protection. Allowing for opt-outs would lead to the break-up of the single market. That is clearly not in Britain's interests.

I refer to a number of issues that the noble Lord, Lord Howell, mentioned. He seemed to paint a picture which would entail us derailing the IGC and the processes of reformation in order to consider the wider issues of Europe. There has been a profound debate about Europe. It has been continuing for many years. That debate will continue. However, much needs to be done to ensure that the reality of today is maintained and that the systems we have are efficient and fair. That is what we are trying to do. That is what has been achieved.

My noble friend Lord Bruce of Donington asked that governments in the EU should make a better effort to explain to our citizens what is happening. I am glad to say that in this IGC this Government have made efforts to do exactly that. In February of this year we published a White Paper called The IGC: Reforms for Enlargement. We hope that it is written in a clear and comprehensive manner. The White Paper was published by the Government and there is a price marked on it. However, I shall be glad to send my noble friend a complimentary copy if he would be assisted by it.

The possibility of the European Union or European Community acceding to the European Convention on Human Rights has been favoured by the committee for some time. Today it was referred to specifically by the noble Lord, Lord Williamson. I can still clearly recall our last debate on the Charter of Rights. Like the committee and some noble Lords, I can see some advantages in the European Community acceding to the European Convention on Human Rights. It could be a means of ensuring further consistency in approach between the two courts.

However, as I said before, it does not seem essential. The treaty already requires the respect of fundamental rights--Article 6.2 of the Treaty on European Union--which includes those in the European Convention on Human Rights. This is justiciable before the Court of Justice: Article 46(d) of the Treaty on European Union. The Court of Justice already applies the European Convention on Human Rights and its case law without accession.

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There are practical obstacles. The Court of Justice has also ruled that the European Community does not have the competence to accede. Accession would require changes to both the convention and the European Union/European Community treaties. That would be a time-consuming exercise. As the committee's report highlights, we need to bear in mind the tight timetable for this IGC.

We are encouraged by the fact that the Court of Justice and the European Court of Human Rights have in recent months been informally discussing co-operation and the impact of the Charter of Fundamental Rights. That brings me on to those noble Lords who commented on the charter.

This Government welcome the Charter of Fundamental Rights as an opportunity to set out clearly and simply the rights which EU citizens already enjoy. People need to know their rights and the European institutions need to respect them. The charter will help on both those counts. I understand the fears of the noble and learned Lord, Lord Howe, when he says that "chartermongering" can lead to confusion. In this instance we say that it will lead to clarity.

As noble Lords will be aware, the convention held its final negotiating session earlier this week. I welcome the improvements secured by my noble friend Lord Goldsmith at this meeting and look forward to seeing the final text on Monday. I believe that the charter will be a good result for the United Kingdom and that this is a good example of a positive yet tough negotiating approach paying dividends. The United Kingdom has a long and proud tradition in the protection and promotion of human rights in Europe. This country played a substantial role in the drafting of the European Convention on Human Rights and was the first to ratify it. This Government have restated that commitment through the introduction of the Human Rights Act here. We are strongly committed to the development of a culture of rights and responsibilities across Europe and we welcome a charter that meets that goal.

The legal status of the charter is for the Heads of Government, not the Charter Convention, to decide. The UK Government have been consistently clear that the charter should be declaratory, not legally binding. We were encouraged by the support for that approach at the Feira European Council in June.

The noble Lord, Lord Howell, and the noble Baroness, Lady Park, both touched on defence, as did the noble Lord, Lord Owen, who, regrettably, is no longer in his place. The Government are making good progress in securing our objectives on European defence. A few months ago at Feira, the European Council looked ahead to establishing permanent new arrangements in the EU for military crisis management shortly after Nice.

There is a lot of work to do before then. We have agreed with partners the principles establishing EU relations with NATO, and giving a role to those European members of NATO who are outside the EU. The detailed work to put those principles into practice remains, but the task is already under way.

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Feira also looked at whether treaty change would be necessary for the new arrangements that we have in mind. The European Council took note of the legal advice given. The changes under consideration to give the EU access to military capabilities to allow it to carry out crisis management and peace-keeping tasks were already adequately provided for in the treaty. However, as our work goes forward we may find areas in which treaty change is desirable in order to put in place the most effective arrangements possible. That is why Feira asked for the question of treaty change for defence to be kept under review in the run-up to Nice. Should defence become part of the IGC, the Government will ensure that your Lordships are informed.

It is right that the Commission, as well as the presidency, reports to the European Parliament on the common foreign and security policy--Article 21 of the treaty on European Union--but the Commission will not be present or represented on the new military committee and will therefore be unable to report on that. The information about the military committee will come from the presidency and nowhere else.

Several noble Lords have referred to the comments made by President Chirac and Joschka Fischer and others and the wider issues that flow from them. The debate on Europe's future is alive and well. Our Prime Minister will put forward some thoughts in a speech in Warsaw one week from today. I do not have the temerity to pre-empt what he may wish to explore with his colleagues at that time. However, all that must be seen as separate from the IGC.

We fully accept that the forthcoming IGC will not be the last word on the future shape of the EU. That future shape cannot be a question only for the present member states. The new members of the club must play their part in making the club's rules. The first new members should join us around the table before decisions are taken in another IGC. Any work on that future IGC must not delay work on enlargement.

I also once again respectfully agree with the comments of the noble and learned Lord, Lord Howe, when he mentioned the fears expressed about the emergence of a superstate. He was right to ask where those views come from. Notwithstanding his comments, it is right that I should respond as well.

Any discussion that we have on the direction that the Union should take does not amount to a continental or Franco-German plot to subsume the nation state and erase British nationality. In his speech to the Bundestag, President Chirac stated clearly:

    "Neither you nor we envisage the creation of a European superstate which would replace the nation states and signal the end of their existence as actors on the international stage".

And if that were not enough, a few days later he clarified the point:

    "I do not think that one can have a federal Europe. At least as a Frenchman would understand the term. The creation of a United States of Europe is not realistic, because not a single nation is prepared to give up its identity".

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I echo those comments. I for one would not be prepared to see the creation of a federal European state and I can reassure my noble friend Lord Bruce of Donington that his pride in being British is shared by all members of Her Majesty's Government and, I am sure, by Members of this House. That pride will not abate. And, in case there is any doubt, it is wholeheartedly and unreservedly shared by me.

Her Majesty's Government have taken into account the results of the Danish referendum. I know that the noble Lord, Lord Owen, suggested that the Government had said that the referendum was irrelevant. We have never said any such thing. I believe that the noble Lord confused the words of the interviewer with the response of the interviewee.

Therefore, I take this opportunity to react to the observations and to comment briefly on the results of the Danish referendum held yesterday. My comment is simple enough. The Danish referendum is a matter for the Danish people. The outcome has no bearing on the Government's policy towards the United Kingdom's membership of the single currency. I can assure the noble Lord, Lord Roper, that we intend to take his advice and not to be diverted by the Danes.

As the Chancellor made clear in his Mansion House speech in June, the Government's policy on the EMU has not changed and will not change. It remains as set out by the Chancellor in October 1997 and as restated by the Prime Minister in February 1999. The determining factor which underpins any government decision is whether the economic case for the United Kingdom to join is clear and unambiguous. If it is, there is no constitutional bar to joining. Because of the magnitude of the decision, the Government believe that, whenever a decision to enter is taken by the Government, it should be put to a referendum of the British people. We know what the Danish people have said; British people will be given the same advantage to speak and be heard.

It is clear that, so far as concerns the Inter-Governmental Conference, we have much to do in the next few months. However, I can promise the House that the Government will remain committed and engaged. Enlargement is a prize worth fighting for.

I thank the committee again for its report and promise that we shall continue to keep it up to date with progress as negotiations progress. Of course, as we approach the final Council in Nice we should welcome any further input that it has to make. I say again how much I have been warmed by the speeches in the House today and how much I thank each and every participant for their extremely valuable and well thought-out contribution.

3.24 p.m.

Lord Tordoff: My Lords, I echo the last words of the Minister. It has been an excellent debate, with four-and-a-half hours of concentrated, sensible, intelligent speeches-- which doubtless will go totally unreported in the world outside, but the debate has nevertheless been worth while.

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I have been flattered more than anything by the fact that the Minister confused me with the noble and learned Lord, Lord Hope of Craighead. I must not get big headed about that.

We will continue to keep our eye on what is happening at the IGC until the last minute, and indeed, we will progress from looking at the Commission to having a look at the Council, because

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it seems that the efficiency of the Council is something which may merit investigation by your Lordships on that Committee and by the House.

I shall not make another long speech at this stage, but I am grateful to everybody who has participated in the debate.

On Question, Motion agreed to.

        House adjourned at twenty-five minutes past three o'clock.

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