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Lord Howell of Guildford: My Lords, I apologise to your Lordships and to the Minister for missing the first few minutes of his opening comments. I can assure the House that by an extraordinary manifestation of cross-party support and consensus, I have been able to ascertain the general drift of what the Minister said—indeed, the precise words. I hope he will forgive me. The timing caught me short.

I want to make it clear to the Minister—it is probably evident to him—that there is broad and strong support from this side of the House for the Bill and for the aims and purposes behind it, notably the treaty that the Bill seeks to bring into British law. However, the Bill raises a number of acute questions about the enlargement and the whole future direction and character of the European Union to which the answers are far from clear. Indeed, in recent times, they have become even less clear. I shall return to them in a moment.

First, I turn to the precise purpose and detail of the Bill, which is to give effect in UK law to the accession treaty opening the way, as the Minister has explained, for Bulgarian and Romanian membership of the EU. That treaty is an extremely bulky document, which I have here—I can hardly pick it up. It was laid before Parliament last August and contains four sections. One of those sections is redundant as it concerns the interaction of the treaty with the proposed European Union constitution, which has, of course, capsized and sunk to the bottom of the sea where, in my view, it deservedly lies. The section dealing with the relationship between the treaty and the constitution no longer is of any particular use.

That is slightly odd because we were assured at the time of the debate on the constitution that our doubts about it were destructive and that the constitution was necessary—I believe those were the words of the Prime Minister—for enlargement to proceed. At the time we questioned whether the Prime Minister and the Government had that right. It turns out that our questioning was right and the Government were wrong. It is, of course, nonsense that the constitution was necessary for enlargement. Certain improvements and changes are necessary but the ill judged, ill constructed and ill directed constitution was not one of them.

However, the episode reminds us of an important aspect of all these enlargement negotiations, and this will not be the last. There is no doubt that there is more to come with Macedonia, Croatia, Turkey, Serbia, Ukraine, Belarus—who knows?—and others. Each time there is an accession process the newcomers are stepping on to a moving platform. The EU is, to put it bluntly, in flux. The rules by which it is to be governed
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are unsettled; the powers and competences of the central EU institutions are in dispute—although the constitution tackled them, it failed to solve the problems and without the constitution they remain unsolved—the social policy dictates, as people increasingly recognise on all sides, paralysing economic growth in the union; and the future budget, to which I shall return in a moment and on which there has been in the words of the Minister "recent agreement", rests on vague undertakings about agricultural support which may or may not materialise. They seem to be hanging in the air.

In a sense there is a sort of time warp at work. These new entrants believe, or are being led to believe and no doubt want to believe, that they are joining a European Union or a European Community of the kind that existed some years ago; namely, a mighty oasis of free-market vigour and democratic freedoms and values which some years ago seemed to be a bastion against Soviet communist tyranny and corporatist socialism, and an engine for expanding free markets and open markets and doing away with protection in world trade. That was the EU—before it was called a union it was called a community—that many of us admired and thought was definitely an entity that all countries in this region of the world should seek to join and join quickly. Of course, today things are not like that at all. Today the EU has lost its free-market vigour. The Soviet Union is no more and today Europe is trapped in a dense network of centralist regulations and restrictions and, as the Financial Times said this morning in its editorial, Brussels is no longer the motor or driver that it once was.

In a way it is a pity that we cannot offer these new arrivals a better welcome and a better ambiance to join. It seems to me quite wrong, for example, that they should be required to sign up to the whole of the acquis communautaire—that is the massive book of EU powers of at least 88,000 pages and some say it is nearly 98,000, many of which are completely out of date and belong to an institutional structure and process which is not relevant in this century. Indeed, they belong to the age before the information revolution which has made the dispersal of power so much more desirable and practicable, and centralism so much more inefficient and unnecessary. In my view, a really vigorous assault on redundant acquis powers is one more thing that should have happened and one more missed opportunity under the dismal British presidency.

Clause 1 makes the accession treaty part of UK law and deals with increased powers for the European Parliament. It does not say anything about the safeguard and postponement clauses that the Minister rightly explained, which would allow negotiations to be delayed if certain criteria in the two countries were not met. I would like to ask the Minister a couple of questions about these, since safeguard measures can be triggered by old member states—the United Kingdom, among others—as well as by the newcomers.

Who makes the key judgments as to whether the negotiations should be suspended for one year, as they can be under the treaty, or whether commitments are
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being met, either on the internal market front or in justice and home affairs? Who is the judge in all this? Is it the Enlargement Commissioner's say-so, or is there an open procedure? Or is there an appeal avenue? These are serious judgments, with serious effects. The Commission apparently has to pronounce whether good governance and accountability are up to standard, but is it really the body that we feel is absolutely the best to do that? One has to note that it is a bit strange that these sorts of judgments come from a body whose own standards leave much to be desired, which is not free itself of corruption taints and whose accounts the auditors regularly refuse, year after year, to sign off.

It is undeniable that both these new accession countries have had difficulties in cleaning up corruption and curbing organised crime. However, having had the privilege of a pleasant visit to Sofia just a few months ago, it was clear to me that under the extremely well balanced and wise management and leadership of ex-King Simeon, enormous progress has been achieved. That is gratifying indeed. However, it seems to me that those of us who want to see these two new entrants fairly treated in the coming negotiations ought to be much more inquisitive about the powers of judgment and how they are going to be exercised than perhaps we have been in the past. I would like to hear more from the Minister on all this.

Clause 2 deals with the freedom of movement of workers and one thing must be said at the outset. There can be absolutely no confidence at all in Home Office or Foreign and Commonwealth Office predictions about future patterns and flows in this area. Laughably, at the time of the last big accession to the EU, the Home Office predicted between 5,000 and 13,000 immigrants net a year from the new member states into the UK. In fact, Ministers explained that between May 2004 and September 2005 293,000—not 5,000 or 13,000—workers from these countries were accepted on to the worker registration scheme. As I have calculated it, the departments here were out by about 2,200 per cent which is, frankly, not a brilliant forecast.

As the Minister reminds us, many of those immigrants bring welcome skills and seem to be well spread out across the country and have contributed to economic growth, although there are inevitably one or two less desirable groups and practices that have crept in. But when the Minister says the policy has proved "a huge success", surely what he really means is that the success has come despite the Government's initial and frankly idiotic policy assumptions, and not because of them.

It is therefore no surprise that this time with this smaller, but equally important, accession phase, the Government are adopting a much less cavalier and a more hands-on attitude and are reserving the power to restrict the right to work of Bulgarians and Romanians, as the treaty allows. We are told that the actual level will not be decided for another year or so. I just hope, as we all do, that the Government have better information on which to decide than they did last time. We will have to see.
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Will the Government be proposing the same restrictions on benefit entitlements as those which they had to bring in last time, when it was realised that no other member state was being as silly as we were in initially eschewing all transitional arrangements permitted under those accession treaties at the time?

Finally, I turn to the costs and the budget. It says in the Bill, and the Explanatory Notes confirm, that there will be,

The Minister has explained that there will be a cost of £10 billion, or €15 billion, over three years and this obviously has to fall on somebody. We are told that most of these costs will be borne by the new member states themselves. Is that really right? My own researches suggest that the UK contribution invariably increases every time new enlargement proposals go forward. I accept that these sums are contained within overall existing capped budget limits—or the recent agreement, as the Minister calls it. A more accurate wording in the Explanatory Notes to the Bill would have been "no further additional public expenditure". That would have been nearer to the position and would have been more accurate. I still wonder who makes room for these new outlays within the existing budget.

Of course we must pay, and we have paid, our fair share. These are brave and spirited nations who treasure their independence and share our view here in London of how Europe should develop. But what is hard to bear is that these extra resources are being found not by cuts in the wasteful and destructive subsidies to French farmers, but from the hard-pressed budgets of the rest of us. And it is even harder to bear being told that this is a wonderful bargain for the UK.

The truth is that the proposed further enlargement, which we welcome, must inevitably put the whole CAP structure under even more strain. Justice and fairness cry out that the system should be radically revised now if Europe is to become the more flexible and fairer network of more equal states which most of us—alas, not all of us—want to see.

We must face the fact that there has been an utter failure to go that way, with only vague and unbankable assertions that things will be reviewed in due course. Instead, some shameful but luckily unsuccessful proposals emanated from Whitehall and the Foreign Office some weeks ago, which alienated our friends in central and eastern Europe and left wounds which will be remembered, despite the subsequent attempts to patch things up and the assurances given in the final agreement.

Enlargement is far from popular in many member states of the EU, but here in the UK we on all sides take a positive view—which is what the Minister said, and I agree with him—and we have remembered that in the best parts of our history we have been on the side of the smaller states of Europe against the bigger bully-boy countries. That is the position as I have understood it, but in recent weeks our foreign policy makers—wherever they are in Whitehall—who are obsessed by fashionable notions about "being at the heart of
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Europe" and the "post-modern state" and all that nonsense, have lost sight of our true friends and interests.

Let us hope that with this Bill, and with the accession process bringing these two nations into the European family, we remember again who our best allies are, that we remember what kind of Europe we really want to see, and that we work for it much harder and more skilfully than we have in recent times.

3.17 pm

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