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Lord Bruce of Donington: Shortly, I should like to speak to Amendment No. 1, but I begin by referring to more general remarks that fell from the lips of the noble Lord, Lord Howell of Guildford. He discussed the broad, general purposes of the treaty and its likely overall effect. My points are technical, and can therefore can be easily disposed of. The Bill amends an existing Act of Parliament—the European Communities Act 1972—by virtue of which, as Members of the Committee will recall, this country became adjoined to the then Common Market. That raises certain complications, such as those of interpretation.

I remind the Committee that when it comes to the amendment of treaties that affect the European Community, under the Treaty of Rome the

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Commission is the interpreter—not our legal brains, of which there are fortunately a plentitude in the Committee. It may therefore be appropriate to cast our eyes over the composition of the Commission and form an assessment of whether they are intellectually—I use that word deliberately—capable of interpreting treaties impartially and in accordance with the open argument that we in this country tend to have.

I now turn not to the amendment itself, but to its status. According to the Explanatory Notes, the Bill comes into operation on Royal Assent. We are also told that it is necessary for us to pass the Bill and for it to be enacted so that we can ratify the Treaty of Nice. That sounds a little peculiar to me. What happens if, after all the time that we are bound to spend on our deliberations, the treaty is never ratified? Is all our work to be completely in vain?

The Explanatory Notes state:

    "The Treaty of Nice reforms the institutions of the European Union (the EU) to enable the EU to operate effectively".

The last paragraph of page 1 states:

    "The UK signed the Treaty of Nice on 26 February 2001 and this Bill is intended to enable the UK to ratify the Treaty."

That is extraordinary, because the Bill is due to come into operation immediately it receives Royal Assent.

I ask a purely technical question. There is probably an easy answer. I am not familiar with all the items of procedure. It seems likely that at least two member states will not ratify the treaty. So the Bill may never come into operation, and the European Communities Act 1972 will remain undisturbed. There may be a way to deal with that. I may have misrepresented the position; if so, not knowingly. I should be grateful for an account from the Government—and possibly from Her Majesty's Opposition—of how they view the position. If the Irish, for example, refuse to ratify the treaty, what will happen to the Bill? What will happen to the amendments to the 1972 Act?

I turn to the amendment, which deals with the question of someone being satisfied or dissatisfied with the way in which the United Kingdom conducts its economic affairs. Under Article 7 as drafted, that is a matter not of speculation but of proof, although who is to prove that the United Kingdom has not obeyed or complied with acceptable European Community economic policies is another question. That is now to be decided on suspicion. Who will have such suspicions?

We can only speculate. Let us speculate that France, for example, has an objection. That would be a bit odd, would it not? France is well known only to obey EC regulations when it suits. It is hardly in a position to judge whether the United Kingdom has properly obeyed liquidity rules, or is in danger of adversely affecting the economies of Europe.

As I said, in practice the Commission will make the determination. What the Council of Ministers or the European Council—the status of which, by the way, is nowhere defined in the treaties—will do about that is another matter. Those questions require answers.

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As for the Commission, well, well, well; oh dear, oh dear! The Commission and its directorates remain largely unchanged from the Commission that was severely castigated by the six wise men appointed by the European Parliament, who concluded that they could find no commissioner with any sense of responsibility. Those guys are still there, despite that indictment. Should we not be extremely cautious before devoting much more time and energy to considering the Bill? Would it not be better to wait for ratification of the treaty, combined with what, I take it, would be our speculative approval?

I am not sure how in parliamentary language, in this place and another place, one ranks speculative decisions. So far as my knowledge of the law is concerned—it is not all that good; I defer to lawyers in that regard—it is not a term we use. We do not arrive at speculative conclusions. Parliament deliberates; Parliament decides; and in due course the legislation is enacted; it receives Royal Assent and it comes into operation.

I suggest to the Committee that those questions may perhaps be regarded as procedural. But I regard them as a matter of detail requiring our attention. It may be that the Committee will decide that it is inappropriate for us to proceed further. It will save me a lot of time, and I am sure that it will save others a lot of time also.

4.30 p.m.

Lord Renton: The noble Lord, Lord Bruce of Donington, raised a matter of importance not merely in relation to the drafting of this Bill, but also in relation to the constitution.

As I understand it, the Treaty of Nice, like other treaties, cannot come into force until it has been ratified by each of the members which purport to be a party to it. It would help to clarify our minds if we knew to what extent the treaty has already been ratified. If it has not been ratified by all the purported signatories, then, as the noble Lord, Lord Bruce, said, this Bill is insignificant and it is a waste of time for us to be asked to enact it. I hope that the noble Baroness, who will no doubt reply on this matter, can clarify that point.

Lord Wallace of Saltaire: I hope that it is not being suggested by the noble Lord, Lord Renton, that Britain should always be the last to ratify any treaty revising the European Union. The suggestion that we should be among the early ones is much more desirable.

Perhaps I too may make a few general points while also making the plea that we should treat the Committee stage from now on as one which addresses the amendments and does not raise general points about the European Union and Britain's membership of it. If we see the Committee process as an area in which we contribute to public education and explanation, it will be helpful to address the changes proposed in the Bill itself.

I welcome what the noble Lord, Lord Howell of Guildford, said in his opening remarks regarding Conservative thinking on the future of the European

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Union. After all, we are going directly from this consideration of the ratification into preparations for the next intergovernmental conference, which I suspect will be a much more important revision of the treaty than the relatively modest set of changes we are currently discussing.

I particularly welcome the suggestion from the noble Lord, Lord Howell, that consolidation of the treaty is something that the Conservatives will accept. That is one of the major issues on the agenda for next time. I was a little surprised when I saw the amendments tabled by the Conservatives in this Chamber. They drew heavily on the amendments tabled by Bill Cash in another place, which seemed to me to be remarkably Euro-sceptic, if not in some ways Europhobic. But if we are to use them as a means of teasing out what the implications are for Britain, that is entirely as it should be.

In terms of making things clear to the public, my noble friend Lord Phillips of Sudbury tabled an amendment for a later stage which I hope will attract Conservative support. It suggests that the Government need to put into more simple language what the constitutional and political implications of these changes are for the British public.

There is some history behind the proposals to revise Article 7. As I remember, it was in 1978 that the then British Foreign Secretary, the then David Owen, proposed that the European Council should issue a declaration on what the Community should do in case a member slides back from full democratic standards. At the time he was looking ahead to the forthcoming membership of Spain, Portugal and Greece, then applicants which had only recently returned from more proletarian military governments to democracy.

We have before us a gradual strengthening of the conditions against the possibility that some member state may begin to backtrack from full democratic standards. With the prospect of enlargement moving from 15 to 25 states, that is clearly something we need to consider.

I agree with the noble Lord, Lord Howell of Guildford, that the Austrian experience was difficult and far from happy. The Belgian Government rather overplayed their hand. The revised wording and arrangements in that respect are therefore an improvement. We are not talking about a serious breach in itself, but about a clear risk of a serious breach. Where that question arises—none of us can predict in which potential or current member state such a situation might arise—the Council of Ministers and the European Council can discuss it. We therefore support the revision of Article 7 and give the Government our support in that respect.

Lord Willoughby de Broke: I rise to support the amendment to Article 1 proposed by my noble friend Lord Howell. I cannot agree with the noble Lord, Lord Wallace, that it is better to discuss a potential breach rather than an actual breach. I remember when the Austrian question arose last summer. The noble Baroness, Lady Scotland, who answered at that time

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for the Government, in reply to questions from the noble Lord, Lord Chalfont, said that they would act only should there be an actual breach; that the European Union would feel threatened only if there was an actual breach.

I cannot see how the idea of some sort of potential, hypothetical risk can or should entail the severe punishment they have vested on the state that commits or is in danger of committing what is called a "clear risk of a serious breach". That includes suspending its vote; suspending its veto and going ahead with all the legislation but without the participation of that member state. That member will not actually have done anything. It will simply have been determined by a majority of four-fifths that there might be a risk that it will do something.

Surely we should know what is meant by a "clear risk". It is difficult to define. Also, what is a "serious breach" as opposed to a "breach"? Where does it come in? Who will decide what is a "serious breach" and what is a "clear risk"? A state which is deemed to have come to the pass of creating a serious risk can suffer serious consequences. We heard the precedent of last summer's Austrian experience, which was not very happy.

The article as it stands could in fact be anti-enlargement. It will make it more difficult for some of the candidate states to support their proposed membership. If their electorate elects somebody who is not to the taste of the other members of the European Union, they may say, "I am terribly sorry, we are not going to allow you to participate in the decisions". That is neither democratic nor forward looking when it comes to enlargement. It supports the thinking that this treaty is not so much about enlargement as about increasing the powers of the European Union and the Commission as they now stand. I shall therefore support my noble friend if he decides to take this matter any further at any stage.

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