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Lord Pearson of Rannoch: My Lords, briefly, the noble Lord knows that we do not all agree that enlargement is a good thing. We think that it is a bad thing for the emerging economies of Eastern Europe; they cannot possibly afford it and they are far better off on their own, retaining their democracies under NATO.

Lord Wallace of Saltaire: My Lords, I apologise; I had not accounted for the eccentricity of the views of the noble Lord. The representatives of 28 states are present in the convention; it is not a convention in which the views of the candidates are being taken for granted. But we clearly need more effective decision-making. I want a European Union that is able to do less a great deal better, with a smaller Commission and a stronger Council leadership. The rotating council presidency must clearly change. Perhaps we need a much more effective Council presidency or a team presidency.

However, the question of subsidiarity and national parliaments is an important issue to which we have not yet paid sufficient attention and on which the convention, the praesidium, is going in the wrong direction. We want a strengthened role for national parliaments, to resist the tendency for those in Brussels to believe that when things are done in Brussels, they are necessarily done better and to strengthen democratic checks.

I welcome the ideas that Gisela Stuart advanced for not just a yellow card when a sufficient number of national parliaments question Commission proposals, but for a red card, whereby if two-thirds of national parliaments object to proposals, the Council should have to vote on the basis of unanimity. All of that needs to be advanced. I should also like national parliaments to have much closer links with their national Members of the European Parliament.

I regret that so much of the debate has been at a different level, with many old arguments repeated and with the linking of the defence of an absolutist view of British sovereignty with support for Anglo-Saxon solidarity—indeed, following the United States. It is always a great oddity about anti-Europeanism in this country that those who think that any further co-operation with France, Germany, the Netherlands and

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Belgium is an invasion of British sovereignty seem to assume that when we follow what Washington tells us, that is not in any sense a derogation of British sovereignty. The noble Lord, Lord Saatchi, captured that well in his comparison of America to God the Father—something that we therefore have to follow—with the European Union as the serpent tempting Eve.

There is a real divide here. It is a divide between the noble Lord, Lord Howell, and the noble and learned Lord, Lord Howe, about whether we are "America Firsters" or Europeans—"Europe Firsters". As the noble Baroness, Lady Blatch, said, Iraq presents a real difference in that debate. That is our biggest divide. I strongly agree with the noble and learned Lord, Lord Howe, that common foreign policy and a more effective basis for European co-operation in foreign policy is the priority. On the question of how we rebuild European collaboration to balance the United States—not to oppose the United States but to answer the call made by President Kennedy in 1962 that the United States would be better off with a European pillar to balance it—I stand on one side of the divide and some noble Lords who have spoken stand on the other.

In this House, we suffer from Gresham's law in European debates. Euro-scepticism drives out reasoned debate on other Benches. I apologise for the fact that my Benches have been rather empty this afternoon; I note that the Labour Benches have been emptier than usual. We need an informed debate on the preferred outcomes and on the details of reform. Britain has now been in the European Union for 30 years. The world has changed around us. We have had the end of the Cold War and surges of asylum-seekers, people smugglers and trans-national crime—a whole set of changes of circumstance to which our Government and others must react.

The noble Lord, Lord Howell, suggested that what we really need is a flexible structure for European co-operation. If it is to be flexible, it must react to changes in the international environment. The convention is addressing some of those issues—not as well as it should, but at least it provides the opportunity and focus for debate. I wish that the Government were leading the British response rather more and encouraging the British Parliament to pay more attention to what is under discussion.

Baroness Blatch: My Lords, before the noble Lord sits down, he has had a very good deal of fun at my expense and at that of others who have spoken in the debate. Does he regard loyalty to country and sovereignty and a concern for the integrity of the United Kingdom as a country as a sin?

Lord Wallace of Saltaire: My Lords, I was brought up on the novels of JA Henty. I used to believe that Britain—or England—was a wonderful empire different from the rest. I have moderated my views on that. Patriotism and pride in one's country is fine, but pride in one's country does not have to involve hatred of all other countries except the United States.

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Lord Pearson of Rannoch: My Lords, might not the noble Lord be confusing patriotism with nationalism?

6.57 p.m.

Lord Astor of Hever: My Lords, I am sorry that the noble Lord, Lord Wallace of Saltaire, will not respond on his outrageous accusation.

I, too, am grateful to my noble friend Lord Blackwell for introducing today's debate—an issue to which, as my noble friend Lord Howell said, we attach great importance. I agree with my noble friend Lord Norton of Louth that we should have more debates on the subject—and in Government time. It is disappointing that there are no speakers from the Government Benches on this vital subject, apart from the Minister.

I have not been disappointed by the quality of speeches from all sides of the House. Despite what the noble Lord, Lord Wallace of Saltaire, said, it has been a sensible and reasoned debate. I was especially pleased to listen to my noble and learned friend Lord Howe of Aberavon. I compliment him on the excellent work that he and others performed in producing their memorandum to the convention. It contained much solid good sense and practical reforms, not vainglorious ambitions.

We are all grateful to the noble Lord, Lord Grenfell, Chairman of the European Union Committee, for the knowledge and expertise that he brings to the House. I welcome the Select Committee's request for greater openness in the Council when they are legislating. I was also glad to listen to the noble Lord, Lord Maclennan. The whole House will agree with the noble Lord, Lord Grenfell, about the hard work that the noble Lord, Lord Maclennan, has performed at the convention and in keeping the House informed.

I was not surprised at the widely divergent opinions—from those noble Lords who welcomed the constitutional shift presented by the convention's draft proposals to those who fear subjugation of Britain's sovereignty and the creation of a more powerful but less accountable central bureaucracy. My noble friend Lord Blackwell set out the two vital questions: first, do the proposals amount to a major constitutional shift in the nature of the European Union and its relations with nation states, or are they simply a minor codifying of the rules, and, secondly, should the Government hold a referendum? By my count, today the response by the majority of speakers to both questions has been "Yes".

My noble friend Lord Blackwell pointed out that the proposed constitutional treaty should be seen as a once-in-a-lifetime constitutional change. My noble friend Lord Howell, in a very powerful speech, described it as a "blockbuster" and the most important and far-reaching piece of EU legislation ever to come before us, giving the EU institutions a new source of legitimacy above the nation states. Both believe that the Prime Minister should reject the constitution idea. The House has heard some very strong speeches following on from the theme of my two noble friends. A healthy majority has supported the call for a referendum.

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No one can doubt that this country's relationship with the EU is vital for our future. The shared cultural heritage and attachment to democracy is far greater than any differences, and the EU forms part of the bedrock of western alliances. We always have been, and, I hope, always will be, intimately connected to the European mainland. I myself have worked in France, and my children have had part of their education there. No matter how often our governments may quarrel—and they will—our affairs will be entwined with those of our European neighbours.

Indeed, the EU has accomplished much to advance the European family of nations. It has increased our prosperity through the single market, which some of my noble friends here did so much to establish. The freedoms that it creates allow thousands of Britons, from students to businessmen, to travel, live and work in the EU. Moreover, the European Union has brought stability to young democracies. We have seen that in Portugal, Spain and Greece, and we very much hope that that will be the case in the new democracies of eastern Europe. I was privileged to visit Estonia last year, and I know how much they look forward to the challenges of EU membership.

The EU, then, has accomplished much, and there is still much to do. The single market must be completed, and enlargement must be made a success. But for the EU to be a success in the 21st century, it needs radical reform and a change of attitude among its leaders. I feel that the speech of the noble Lord, Lord Hooson, was far removed from the views of most noble Lords, particularly on the EU loyalty issue.

While the world's attention is, naturally, focused on the war in Iraq, the outcome of the Convention on the Future of Europe has not diminished in importance. It remains the case that any constitutional treaty emerging from the convention is meant to provide the EU's framework for many, many years to come.

I agree entirely with my noble and learned friend Lord Howe of Aberavon and the noble Lord, Lord Stoddart of Swindon, that the convention should not be constrained by an artificial timetable, and particularly in a rush to have a new Treaty of Rome.

The convention was set a vital task. The Laeken declaration rightly stated that,

    "the European Union must become closer to its citizens".

The EU faces a crisis of democratic accountability and connection with its peoples. Turnout for European elections has fallen below an average of 50 per cent across Europe. My noble friend Lord Pearson of Rannoch is right to point out that many electors find the subject of Europe very boring. We on these Benches want this grave predicament for the EU solved. We want an EU fit for the 21st century and a membership of 25 or more. We want an EU able to deliver its core tasks, the job its people want it to do, the job it was set up to do: helping provide prosperity and stability in Europe.

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During this debate, many noble Lords were not confident that the convention would meet that challenge. Their fears are shared by our representatives in the European Parliament and, as several noble Lords pointed out, the honourable member for Edgbaston, Gisela Stuart, the only British parliamentarian on the praesidium. She warned, in an interview with the Independent, that the constitution could make the EU more bureaucratic, complicated and remote from its voters.

When the first draft articles of the constitution were published there was, she said, "fairly serious disquiet" from governments. She added:

    "I was taken aback by the strength of the reaction. If they find it difficult to accept this, how do you think the public feels?"

She said that, although many voters appeared unhappy with the status quo, the convention was,

    "embarking on a process of expanding that. Unless that is what people really want, you get a huge gap developing between the people who make the decisions & the electorate. That is when you get the Le Pens and the far right".

For the honourable Member, who is seen as one of the main architects of the draft constitution, that was quite an admission. We, on these Benches, have warned for a long time that there is a huge gap developing between the people who make the decisions and the electorate.

A number of noble Lords, including my noble friends Lady Blatch, Lord Saatchi, Lord Stevens of Ludgate and Lady Seccombe, mentioned Article 14 and the implementation of a common foreign and security policy. The effect of the war in Iraq will shift the post-war debate in ways that we would be foolish to underestimate. As my noble friend Lord Blackwell said, it seems inconceivable that the Government would consent to a constitution that contained this clause. Like him and a number of other noble Lords, I would welcome the Minister's specific assurance on that point. It is no surprise that the convention has postponed discussion of the place of the CFSP in any new treaty until the situation has settled.

A number of noble Lords, in particular my noble friend Lord Shaw of Northstead, mentioned national parliaments. I agree with the honourable Member for Edgbaston that they are too weak. I detected the same thought from the noble Lord, Lord Wallace of Saltaire. The consensus of the convention appears unable to recognise that national parliaments, for all their faults, are the political bodies that the peoples of Europe understand best and to which they feel closest. They must have real power over European legislation. It is pleasing that they should be able to warn of breaches of the principles of subsidiarity and proportionality. National parliaments must be allowed to halt legislation if it breaches those principles.

The important Articles 26 and 27 have not been mentioned. Does the Minister agree that the draft constitution provides far too little legislative oversight on what the document calls "non-legislative acts"? After all, many of the envisaged "non-legislative acts" are, in fact, legislative in character. Will those non-legislative acts not affect what the draft constitution calls "framework laws", at present known as directives, which are

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supposed to leave more discretion to national parliaments on their implementation? Article 249 of the current EC Treaty states:

    "A directive shall be binding, as to the result to be achieved, upon each Member State to which it is addressed, but shall leave to the national authorities the choice of form and methods."

Will the proposed non-legislative acts diminish that national discretion? The draft constitution provides for no national parliamentary oversight. That is yet another example of how the draft constitution has all the wrong priorities, centralising—not devolving—decision making.

That measure even manages to diminish democratic accountability, which is already in inadequate supply in the EU. I hope that the Minister will deal with that point in her winding-up speech and tell the House what the Government propose to do to remedy the situation. Does the Minister agree with the Conservative members of the convention that the competencies given to the EU by the constitution are excessive and should be reduced?

Until its final report is published and agreement is reached in the Council of Ministers, it is uncertain whether the convention will signal the final steps towards putting in place a fully fledged European political union or mark the high tide of the integrationists by reinforcing national sovereignty. Many people would disagree with the observations made by the noble Lord, Lord Wallace of Saltaire, about the speech made by my noble friend Lady Blatch. Many people, myself included, are proud of this country and of the Union.

It should come as no surprise that the draft constitution is so ambitious. That is the nature of constitutions; they are not like golf club rules. They redistribute the balance of power. Whatever the content, any constitution would represent one of the greatest changes in the balance of power that our country has ever experienced. I find it disappointing that the Government that set up referendums for a variety of purposes in Scotland, Wales, London and Hartlepool refuse to allow the British people a say on a European constitution.

The convention's final text should not be a constitution for a federal European state. The Government have tabled many amendments to the draft constitution. I hope that they will now devote all their energies to fighting for a Europe of nations, not a nation of Europe.

7.12 p.m.

Baroness Symons of Vernham Dean: My Lords, I begin by adding my voice to those of many noble Lords who congratulated the noble Lord, Lord Blackwell, on introducing the debate today. The Convention on the Future of Europe is considering many important issues in an effort to mould a Union that will serve us well in the years to come. It is right that the House should have sufficient opportunity to debate those matters.

As always, the subject of Europe has brought out some fine speeches and some of the strongest convictions that we hear expressed in your Lordships'

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House. There has been a wide-ranging and fascinating discussion of many—though by no means all—of the key issues raised by the convention. I echo the sentiments expressed by the noble Lord, Lord Grenfell, concerning the two Members of the House who are alternates on the convention: the noble Lord, Lord Maclennan of Rogart, who is in his place, and my noble friend Lord Tomlinson, who is in Brussels on convention business this afternoon. I also commend the valiant efforts of my noble friend Lady Scotland of Asthal and the enormously hard work that she has undertaken on our behalf on the matter.

As the noble Lords, Lord Howell of Guildford and Lord Maclennan of Rogart, implied, the convention has moved into its most crucial phase, with the consideration of the draft treaty articles produced by the presidium. I am delighted that the Select Committee on the European Union, under the wise leadership of the noble Lord, Lord Grenfell, has been so active and so swift in its consideration of the draft treaty articles. I thank the noble Lord and his committee for all their hard work. Like the noble Lords, Lord Astor of Hever and Lord Wallace of Saltaire, I commend the papers that they have produced to your Lordships.

Despite what some of your Lordships evidently believe—I enjoyed the speech made by the noble Lord, Lord Harris of High Cross—the fact is that we have made considerable progress in the convention discussions so far. For example, we have secured a substantial new and formal role for national parliaments to ensure that action is taken at the appropriate level, national or European. That is the early-warning mechanism for enforcing the subsidiarity principle to which the noble Lords, Lord Blackwell, Lord Howell of Guildford and Lord Grenfell, referred. As we heard in some detail during the debate, at the beginning of the year my noble friend Lady Scotland of Asthal worked very hard to ensure that the European Charter of Fundamental Rights did not change the competences in those crucial respects of the EU. We resisted pressure to make further moves towards qualified majority voting in social policy. We argued that the provisions introduced by the Treaty of Nice needed to be tested first. That does not mean that we are, in any sense, complacent.

I agreed with many noble Lords that there is still a great deal of work to be done. That point was made forcefully by the noble Lord, Lord Norton of Louth. Work needs to be done to protect the United Kingdom's key interests and to ensure that the progress made on the working groups is not undone in the draft articles prepared by the preasidium. It is always important to remember that there will be others who wish to see some adjustments to what has come out of the convention so far. Not all those adjustments will necessarily be welcome to us.

As the noble and learned Lord, Lord Howe of Aberavon, said in his well crafted contribution, it is important to remember how much hard work lies ahead. I assure the noble and learned Lord and the noble Lord, Lord Cobbold, that there is no fixed agenda for the intergovernmental conference. As your

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Lordships will know, the date is set for 2004, but there is some argument about when it should be. Some argue for it to happen sooner, towards the end of this year. The key point for Her Majesty's Government is that the IGC must allow full participation by the accession states so that they can debate the form of the European Union that they will join. We also believe that it is important that there is space between the end of the convention and the beginning of the IGC for national parliaments to consider the issues fully. I hope that the noble Lord, Lord Hooson, will be comforted by that. Again, I agree with the noble Lord, Lord Norton of Louth—I hope that he is not too embarrassed by the degree of agreement between us—that it is important that the public be informed and the information disseminated on all the key issues.

I turn to the draft treaty articles, starting with Articles 1 to 16. As many of your Lordships have said, the first set of draft treaty articles—on the values and aims of the EU—created a stir, and rightly so. They cover issues that go to the heart of the debate about Europe. They tell us about the genesis of the Union, its objectives and the values to which, we hope, we all subscribe. As the noble Lord, Lord Norton of Louth, implied, there are some odd elements—it might be appropriate to describe them as surprises—in the draft articles before us that do not reflect the conclusions and recommendations of the convention's working groups or the plenary session discussions.

At the same time, we should remember that the draft articles contain some good ideas, such as the new subsidiary mechanism, to which many of your Lordships referred, and set out more clearly the competences of the Union and of member states, although, as we all know, we do not agree fully with those lists. We have also prepared for supporting action that confirms that, in certain areas—education, for example—the Union cannot harmonise legislation. If we do not support proposals, we have submitted amendments to the convention. Your Lordships will recall that the Secretary of State for Wales, the Government's representative at the convention, spoke out strongly on several issues as soon as we saw the draft. Both Peter Hain and my noble friend Lady Scotland of Asthal raised concerns about the "federal" reference, as many of your Lordships have done today. As the noble Lord, Lord Norton of Louth, pointed out, the term "federal" means different things to different people in different countries. I agree with the noble Lord that the constitutional treaty should simply say what we mean: that is, that certain policies are co-ordinated at European level to achieve goals that member states cannot achieve for themselves.

I must make it clear that, like several of your Lordships, particularly the noble Lord, Lord Saatchi—I am sorry to see that he is not in his place—we were especially unhappy with the language on economic governance and foreign policy. We shall not accept these becoming full Community competences. The proposals do not reflect the discussion in the working groups. The economic governance group, for example,

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was split and did not come to a conclusion. The external relations group agreed that there should be no communitisation of foreign policy. We also emphasised the need to preserve distinct arrangements for the common and foreign security policy and some aspects of justice and home affairs, to which I shall return later.

The noble Lord, Lord Saatchi, took issue with the way the draft treaty articles deal with who has responsibility, or what, indeed, are the competences. I agree with some of his points. The Government have raised concerns on some of these issues. We have made it clear that what we want is what the noble Lord, Lord Williamson of Horton, said; namely, a scheme of competences that is clear, flexible and simple. There is also a need for accuracy and legal certainty. The scheme must allow us to protect and safeguard our own national interests. The convention president has publicly accepted the need for a constitutional treaty to clearly state that the power of the Union comes from the member states and not the other way around.

I turn to the draft treaty Articles 20 to 33, which are the second set. I think that it is right that these are much more technical than the first set which we received. But that does not make the second set any less important. Much of this set is related to simplifying the Union to make the processes less complex and, it is to be hoped, easier for people to understand. That is a good thing.

We want more people to understand how the European Union works. Again, I agree strongly with the noble Lord, Lord Williamson of Horton, that we are all for simplifying and reducing the number of instruments and terms used. Introducing words such as law and framework law will make it easier to follow what is going on in Brussels compared to the current mix of terms recited by the noble Lord, Lord Pearson of Rannoch.

While we naturally support greater clarity and simplicity for the instruments, we must maintain a distinct range of instruments for CFSP in the new treaty. After all, most of CFSP is not based on legislation and the various institutions really do have very different roles. While we support co-decision and QMV as the general rule for legislation, there will be exceptions. Therefore, we must examine each case on its merits. There will be instances that are simply not appropriate for all the articles.

Part 2 of the treaty contains the detail of the Union's policy and instruments. What we have seen so far is the result of a technical exercise to prepare the ground for merging the current treaties. The legal experts group responsible seems to have done a good job. We are content that those responsible have fulfilled and have stuck to their mandate—a very important point. But this does not mean that we agree with all the changes.

The legal experts group mandate was based on the conclusions of the simplification working group. We fully support that simplification, as I have clearly stated. The noble Lord, Lord Stoddart of Swindon, was right in saying that we were looking at some extension of QMV on co-decision. But I assure him that we are doing that on a case-by-case basis. We

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would not, for example, accept QMV on taxation. We made that very clear when the simplification working group reported and we shall continue to make it clear.

Many of your Lordships, including the noble Lords, Lord Blackwell and Lord Maclennan of Rogart, mentioned the charter of fundamental rights. The United Kingdom's position has always been—we are not alone in this—that the charter, although welcome as a political declaration, was not drafted in a form suitable for incorporation in the treaties. That remains the case. The charter is not clear about what citizens may expect or from whom they may expect it. Such ambiguity and uncertainty is unsatisfactory for the law. The charter was not intended to change the competences of the Union. We must ensure that an incorporated charter is faithful to that.

However, we need not be afraid to look at ideas of how to give the charter some legal status. The challenge has been to find ways to give our citizens legal security and to give them certainty in relation to the charter's ambiguous or conflicting text. The working group came forward with some amendments to the so-called horizontal articles in the charter, plus the prospect of satisfactory official legal explanations to accompany it. That was endorsed by the plenary. It makes sense to decide how the charter might be recognised in the constitutional theory after work on the commentary has been completed.

My noble friend Lord Grenfell concentrated on the role of national parliaments. Indeed, many of your Lordships were very concerned on those points; notably, the noble and learned Lord, Lord Howe of Aberavon, and the noble Lords, Lord Shaw of Northstead and Lord Wallace of Saltaire. I remind noble Lords that at the moment national parliaments have no formal role in the EU. Given the abundance of knowledge that is present certainly in this House, that is clearly a flaw in the system. I am pleased, therefore, that the convention has recognised that national parliaments should be more involved in EU business. I welcome the wide endorsement of the UK's proposal to introduce an early-warning mechanism which would see national parliaments enforcing action being taken at an appropriate level.

I was rather sorry that the noble Lord, Lord Stoddart of Swindon, did not discuss this matter because I know how much he has concentrated on it in the past. Perhaps he did not believe that the new mechanism amounted to very much. I can imagine that, given his position, maybe he did not. But I would disagree if that is the basis of his not having made any mention of the matter. It is important because the Laeken declaration draws attention to the need for national parliaments to play a greater role in EU affairs.

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