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Lord Harrison: I rise briefly to challenge some of the points made by the noble Lord, Lord Willoughby de Broke. I agree with him that small businesses are at the heart of Europe and the single market. However, I wholly disagree with him that the implementation of the Treaty of Nice will be bad for business in Europe and the United Kingdom and in particular for small businesses. That is what he says in this amendment. I believe that if he reads what the treaty provides, albeit in a very modest way, he will see that the extension of qualified majority voting will actually help small businesses, especially as regards red tape by challenging it, and in the furtherance of research and development. So I hope that he will read again the Treaty of Nice and what is proposed because I believe that he will find that small businesses and business as a whole will be helped by the implementation of the treaty.

Lord Willoughby de Broke: I am grateful to the noble Lord for reminding me to look back at the treaty. I wonder where he gets his information, because all the small businesses I have been involved with, whether in my own personal experience or through the Federation of Small Businesses, do nothing but complain about the increasing amount of red tape from Europe. The European Parliament has just compounded that felony quite recently, as I explained in my recent comments and at Second Reading. Therefore, I do not know how the noble Lord can possibly say that the European Union is making life easier for small businesses when it is perfectly plain that it is not—and that it is doing the opposite.

7.45 p.m.

Lord Harrison: Perhaps I may quickly trespass on the time of the Committee in two specific ways. First, the ambition of the single market is to introduce one set of regulations, replacing the 15 different sets which exist now. Secondly and specifically, in this treaty there are references to small businesses where the use of qualified majority voting will promote programmes in favour of helping small businesses. I encourage the noble Lord to look at that and to gain sustenance from seeing it in practice.

Lord Pearson of Rannoch: Does the noble Lord, Lord Harrison, agree that the harmonisation to which he refers and which is to take place throughout the European Union is harmonisation which will increase regulation in our economy up to the level of that in, shall we say, the German and other economies and thus lose us the competitive edge which we have

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enjoyed for so long—although it is being rapidly diminished by clauses such as this one in the Treaty of Rome?

Is the noble Lord aware that at a convention the Federation of Small Businesses has just voted to leave the European Union altogether, largely on the point of the massive over-regulation which is strangling the small businesses? I cannot see how the noble Lord can maintain his hypothesis.

Lord Willoughby de Broke: I support the amendment tabled by the noble Lord, Lord Stoddart of Swindon. I ask the Minister to explain why this social protection committee is necessary at all. What is it going to do? The noble Lord, Lord Stoddart, is quite right. Once the committee has been established, it will want to work. It will have minutes, a budget, and it will want to be paid. It will be busy.

It is to monitor the social situation and the development of a social protection policy. It is to promote the exchange of information, experience and good practice. But there are plenty of bodies already in existence which do that. Why do we need another massive committee with 58 members? Why do we need it to prepare reports, formulate opinions and undertake other work within its field of competence? Surely there are enough committees in the European Union already and at national level to do these things without establishing another body. Another enormous committee would simply add to the bureaucracy that we have just been talking about. It is to do a job which is not necessary. Can the noble Lord explain why anyone believes that a social protection committee is remotely necessary for enlargement, for example?

Lord McIntosh of Haringey: I am sorry that the noble Lord, Lord Howell, should begin by thinking that these provisions are remote and ineffectual. I remind him that when Hilaire Belloc used that phrase in defence of G K Chesterton he was attacking G G Coulson who was a far more distinguished historian and philospher than G K Chesterton; I am not saying that he was a better poet or novelist. The noble Lord should beware whom he attacks; but it was a splendid piece of invective.

Even those who support Articles 137 and 144 will be somewhat disappointed if they take too seriously what has been said in this debate. Article 137 makes very few changes of substance. Almost all of it is a reordering of the Amsterdam Treaty. For example, voting by unanimity was retained in the following key areas: social security, the social protection of workers, the protection of workers where their employment contracts are terminated, representation and collective defence of the interests of workers and employers, and with regard to conditions of employment for third country nationals legally residing in the Community.

One new provision is the addition of a reference to the modernisation of social protection systems which can take place by QMV. But action in that area is limited to the adoption of measures designed to encourage co-operation between member states, and it does not include legislation. Indeed, I say to the noble

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Lords, Lord Stoddart and Lord Willoughby de Broke, that if they read Article 137(2)(a) they will see that the measures specifically exclude any harmonisation of the laws and regulations of the member states.

The action plans, which are along the same lines as the social exclusion action plans, add impetus to member states' moves to combat social exclusion. Pay, the right of association—apparently this is the concern of my noble friend Lord Stoddart—and the right to strike and impose lockouts continue to be excluded from the provisions of Article 137.

Article 137(4) is amended to make clear that any proposals agreed must not affect the rights of member states to define the fundamental principles of their social security systems and must not significantly affect the financial equilibrium of national systems, which is an important and welcome clarification.

Amendment No. 17 tabled by my noble friend Lord Stoddart refers to the social protection committee which he fears will grow and spread its tentacles all over the European Union. I have to tell my noble friend that it already exists. It was set up to undertake work in two areas identified by the European Council in Lisbon. That committee has existed since December last year and is run on the basis of Article 202. All that happens now is that it is given more specific existence. My noble friend has correctly quoted the three main tasks: monitoring social protection policies in member states and the Union; facilitating exchanges of information and good practice; and preparing an annual report on social protection which highlights key policy developments.

I do not believe that either my noble friend Lord Stoddart or the noble Lord, Lord Willoughby, understands that the establishment of a committee is a move away from a too prescriptive legislative agenda to a useful mechanism to facilitate exchange of information, experience and good practice; in other words, it is in the reverse direction from that which the speakers to this amendment appear to believe it is going.

We support greater exchange of information to learn from each other and ensure that we do more to help people into work and, at the same time, provide greater security for those in work. If social policy in the sense of Articles 137 and 144 is an illegitimate subject for the Treaty of Nice, which appears to be suggested, it has been an illegitimate subject for a very long time. We profoundly disagree that these matters should be excluded from the treaty.

Lord Howell of Guildford: One can hardly disagree with much of the aims and policy objectives which the noble Lord has just outlined. It is sensible that these policies should be pursued within nation states and that all kinds of co-ordination should take place. What is left hanging in the air—the case has not been made for it—is why it is necessary to put Article 137 into a treaty, let alone that it should be upgraded under the Treaty of Nice, if it is all so delicate that it hardly touches anything or intrudes into any national policies. This is to misuse international treaties and the

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legislation which flows from them in far too heavy-handed a way. A tolerant Union which binds Europe together is not made of this material. One cannot bind people together by forcing them together. One cannot bind Europe together by constant activism and intrusion, however light it is supposed to be, into these matters. That is my view on Amendment No. 15 to revise Article 137.

The noble Lord, Lord Stoddart, will speak to his amendment in a moment. However, I have some sympathy with him and my noble friends who have questioned the need for yet another committee. Not only are committees very often fateful affairs, particularly at international and supranational level, but this matter completely fails to understand the way in which the Union is evolving. The Union is now moving in the direction of agencies and soft legislation through national parliaments. The old pattern of a hierarchy of committees at the centre handing down the law has vanished. That pattern belongs to yesterday's Europe, not the systems that are now evolving—whether or not we like them—and certainly not the flexible Europe on which comment has been made in earlier amendments.

As far as concerns Amendment No. 15, I am left very uneasy about the implications and thinking behind it as outlined by the Minister. However, it is an hour when no doubt other things are in the Committee's mind. I shall return to these issues later, but for the moment I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

[Amendment No. 16 not moved.]

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