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European Union

12.25 pm

The Parliamentary Under-Secretary of State, Foreign and Commonwealth Office (Lord Triesman): My Lords, with the permission of the House, I shall now repeat a Statement made by my right honourable friend the Foreign Secretary.

"With permission, Mr Speaker, I should like to make a Statement on the European Union.

"Earlier today, I published a White Paper on the prospects for the European Union covering the next six months, when the United Kingdom will hold the presidency. Copies are available in the Vote Office. Let me first comment on the current situation in the European Union, before coming to the priorities of our presidency itself.

"The European Union's historic success is centred on three major achievements. It has cemented peace on a continent whose history has been one of rivalry and bloody conflict. It has helped to heal the divisions of the Cold War, and to entrench liberal democratic institutions in countries emerging from dictatorship. It has created the world's largest international single market of 450 million consumers.
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"All this has brought greater prosperity to businesses and citizens across Europe, while safeguarding the strong attachment to social justice that is common to all Europe's different economic models. The United Kingdom has benefited greatly from this unique collaboration between nations. Yet the EU must adapt to survive and to prosper in a world quite changed from when it was founded some 50 years ago. It needs, first, better to respond to the sense among European citizens that the EU is remote from the concerns of their daily lives. That was brought into sharp relief by the "No" votes on the EU constitution in two of its founder members.

"Compounding that sense of unease with the EU is the fact that Europe's economies face greatly increased global competition. Soon 50 per cent of all manufacturing exports will come from developing countries. China's overseas trade is doubling every three years. China and India are producing four million graduates a year competing with European firms in the highest-skilled sectors. The EU must deal with such competition by becoming more dynamic and investing more in training and innovation. It has also to tackle more effectively new threats to our security—from terrorism, proliferation and international crime—and respond to the moral and political imperative of improving living standards and well-being in the world's poorest nations.

"Europe's nations are now beginning an important debate on meeting those challenges. As my right honourable friend the Prime Minister said in Brussels last week, in our presidency the United Kingdom will seek to conduct this debate in an open, inclusive way, giving our own views strongly but being respectful of the views of others.

"Alongside the wider questions of the EU's future direction and priorities, there is much specific business to be done in our presidency. Let me take four key areas of the agenda in turn: first, future financing. As the House is well aware, two weeks ago the European Council could not reach agreement on the EU's next Financial Perspective, its revenue-raising and spending plans for 2007–13. For five member states, including the United Kingdom, the proposals then on the table were unacceptable; others also had problems with them. Discussions on future financing will continue under the UK's presidency. Any new Financial Perspective must at the very least set out a process that leads to a more rational budget, shaping the second half of that perspective up to 2013. We recognise our responsibilities in our EU presidency, and we will work hard to reach agreement on future financing by the end of the year.

"Second is economic reform. At issue here is not a choice of prosperity or social justice, but rather what combination of policies can best deliver prosperity and social justice in today's European Union. In that context, we will continue to work for more effective European regulation. The EU will launch in October a major new programme to reduce the volume and complexity of EU legislation, in order
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to ease the burden on business. We will be looking to improve the policy-making process with better consultation and impact assessments.

"Meanwhile, we will pursue discussions on the services directive. We will continue to work on financial services, and on resolving the difficulties over the Working Time Directive in a way which preserves the freedom of individuals to work the hours that they choose, and maintains the Government's ability to deliver high-quality health and public services. We will also pursue discussions on the review of the EU's sustainable development strategy.

"The third area is external relations. Over the next six months, we will chair EU summits with India, China, Russia, Ukraine and Canada, and host a summit jointly with Spain marking the 10th anniversary of the Euromed process. We will pursue EU work on key foreign policy issues such as the Middle East peace process, Iran, and EU support for Iraq. The United Kingdom will represent the EU at the United Nations millennium review summit in September, and follow up Europe's welcome new commitments on increasing aid and on developing a stronger action plan on Africa. We will also be pursuing progress on climate change.

"Freer and fairer world trade offers major benefits, not least to Africa. In the presidency, with the European Commission, we will be steering preparations within the EU for this December's meeting of the World Trade Organisation in Hong Kong. Linked to that objective, we will also aim to conclude the discussions on modernising the EU's sugar regime, an important part of the continuing reform of the common agricultural policy.

"The fourth area of our work for the presidency is continuing the EU's commitments on enlargement. Bulgaria and Romania signed a joint accession treaty with the EU on 25 April this year, and are scheduled to join in January 2007. Both still have much to do to implement the commitments they have made, and the European Commission will report on their readiness this autumn.

"Last December, the EU agreed to open accession negotiations with Turkey on 3 October this year, a decision which was reconfirmed by the European Council two weeks ago. Turkish membership of the European Union is a controversial issue for public opinion in parts of Europe, but the British Government remain strongly committed to Turkey joining the EU, and I know that we can draw on the support of honourable Members from all parts of this House. The European Commission yesterday published a draft framework for Turkey's accession negotiations. The EU and Turkey alike stand to gain greatly from a democratic and prospering Turkey anchored in Europe and demonstrating that Islam is compatible with the values of liberal democracy which form the bedrock of the European Union.

"The EU also stands ready to open negotiations with Croatia, provided that it co-operates fully with the International Criminal Tribunal for the former
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Yugoslavia. We strongly support the membership aspirations of Croatia and the other countries of the western Balkans, but they must, like all EU applicants, meet the necessary requirements.

"This White Paper sets out the responsibilities involved in holding the EU presidency and a calendar of the main meetings. At least 12 informal meetings of EU Ministers and many other conferences, meetings and events will be taking place throughout the UK. Today's White Paper, like those before it, is aimed at providing information and material for public and parliamentary debate on EU issues. The House will, as usual, have regular opportunities throughout our Presidency to discuss the European Union and the Government's position".

My Lords, that concludes the Statement.

12.34 pm

Lord Howell of Guildford: My Lords, I am grateful to the Minister for repeating the Statement. I am sure that he will understand that, as the White Paper is a 27-page detailed document with a five-page glossary necessary to explain all its jargon, one has not had as much time as one would like to study it. Indeed, we have had only an hour or so.

It is nothing personal about the Minister—I have to give him my view—but the White Paper is not welcome to us, because it is riddled with fallacies. I regard it as deeply disappointing at a time of golden opportunity and vast importance for the future of Europe. Of course there are bound to be things in it on which we very much want progress, such as the services directive and the financial services directive. Until that comes about, the EU is very far from completing the single market that we want. We welcome the enlargement process going forward as it should; I totally support the words that the Minister and the Foreign Secretary uttered about the accession of Turkey. However, the period is so long that the EU will be a changed and transformed body by the time that Turkey joins.

The flawed thinking begins in the Foreign Secretary's introduction, in which he starts by talking about the EU "levering up" Africa's living standards. Everyone knows that the main impulses for prosperity are internal to each country. The IMF warned us this very morning on the basis of detailed studies that aid does not boost growth. That is not the way forward at all. The Foreign Secretary goes on to assert that "Europe can deliver prosperity". The EU has delivered many things, some of which are valuable, but at the moment it is certainly not delivering prosperity. Instead it has delivered 20 million people unemployed and virtual economic stagnation, at least in large parts of it, although not all—certainly not Spain, the United Kingdom or Ireland.

I turn to the detail of the White Paper. It talks about future financing, which of course means paying for the EU's activities and whether we lose our rebate. Frankly, I am still not clear what the Government will give on that front and in exchange for what. I would have thought that a more vigorous approach in the White Paper would
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be to start by analysing all the activities of the EU that are recognised as overcentralised, and asking which could be unravelled, repatriated and decentralised. The White Paper talks of "better" regulation but not less or much less regulation, as it should do. Many of us know that, in the world of bureaucracy, "better" often means "worse".

The White Paper speaks of strengthening the partnership with the United States, but the partnership is in very poor shape. Many EU attitudes and policies have made it worse. It talks of ratification of the constitution and states,

Surely we know our own circumstances. That may be a decision of the EU Council overall, but cannot we have a firm line on whether we are to go to a referendum or drop the whole thing?

On page 9, we come to the Lisbon process, which was going to transform the EU economy. Of course it is a complete fallacy to think that a central initiative from on high can transform what goes on inside our separate nation states. The Lisbon process has been refocused countless times. Why does the White Paper think that it will be any better in future when the whole approach is obviously wrong?

The working time directive gets a mention but, as it is a direct attack on workers' freedoms, why is not more vigorously resisted? The stability and growth pact has been reformed to the point of meaninglessness, but the White Paper feebly says that it hopes to see it made effective, which it can never be. The White Paper speaks of education and lifelong learning, which are immensely valuable. However, why do they have to be settled at the remote EU level? What do nutrition and health foods have to do with the Union?

The reform of the common agricultural policy is mentioned and on the agenda, but there is miserably little—virtually nothing at all—on the common fisheries policy. Paragraph 57 on development overseas is unintelligible jargon. It does not seem to be grasped in the White Paper that EU aid programmes have been repeatedly assessed as weak and ineffective, and that major overhaul is needed with repatriation of a large part of them.

On the external side, there is a weak mention of "pressure on Zimbabwe", with no specifics at all. We all know what that means. There is mention of "strengthening cooperation with NATO", but why was it ever weakened? On Iran, the drafters do not seem to be aware of what is happening there and why we need to work closely with Russia to grapple with the new Iran, under its new and fierce leader. On China, a "review is promised" of the ill-conceived idea to lift the arms embargo. What should be promised is that the whole idea should be dropped for the time being, before it increases tensions in Asia.

In his speech to the European Parliament, the Prime Minister said that we should go forward, not by trading insults or presenting the issue as for or against Europe and that there was time for a reality check. I would say to him, "Well, join the club". Many of us
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have argued that for a long time. If, as the Foreign Secretary stated at the end of the Statement that Britain's aim for Europe was,

all that I can say is that infinitely more vigour and creativity is required in the whole approach if we are to achieve any of those aims in Europe's interests—or in our own.

12.41 pm

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