Examination of Witnesses (Questions 40-59)
Mr Jim Murphy MP and Mr Ananda Guha
25 MARCH 2008
Q40 Lord Harrison: Minister, two Fridays
ago we debated our report on the Single Market, in which we called
for less regulation, better implementation of existing legislation
and more liberalisation and competition—and I would also
include better monitoring of legislation. In the light of that
what progress has been made with regard to transposition and implementation
of the Services Directive? And bearing in mind the United Kingdom
as well as the European Union, what instruments can the EU adopt
to help small businesses take full advantage of the Single Market—and
I do draw a differentiation between what we can do collectively
and what we can do in this country, because I sometimes fear that
we spend half our time telling small businesses that the Single
Market is a frightful place to enter where they use foreign languages
and different money and strange things will happen to them, and
we really should be painting the other picture that it is a real
opportunity, particularly in the light of something like the Services
Directive?
Mr Murphy: I absolutely agree. The sense is
and the assessment is that the effective implementation of the
Directive would create about 600,000 additional jobs across the
EU, which is a remarkable opportunity across the 27 Member States.
In terms of the Directive, again it may be helpful, just for the
record, your Lordships, for me to very quickly outline really
what we would like to see as part of the completion in response
to the specific question. The Service Directive—four things—will
firstly remove unfair barriers to cross-border trade; secondly,
create an online information portal for service providers; thirdly,
improve cooperation between service regulators; and fourthly,
and finally, improve the quality of service provision to consumers
through stimulating competition and easier accesses to services.
In terms of the UK in the internal challenge function within Government—and
I am sure business will have its own perspective on it and we
welcome their continuing challenge—we are on track for transposition,
which is important strategically for the UK economy, with 70 per
cent of the UK economy composed of services, of course. In terms
of SMEs specifically there is of course the proposal for the EU
Small Business Act. When I read about this initially the idea
of an Act runs contrary to much of the UK Government's ambition,
but it has not yet been decided as to whether that is legislative
or non-legislative, and that is the conversation that is continuing.
But it is about how do you transpose the Services Directive in
such a way that it is as friendly as possible and as sensitive
as possible to SMEs who do not have access to the significant
sources of advice and technical support by the nature of their
size as some of the larger companies, and it is a significant
challenge for us in the Services Directive.
Q41 Lord Harrison: Do you feel that you
are talking sufficiently to the FSB (Federation of Small Businesses)
and the FPB (Forum of Private Business) and the BCC (Bristol Chambers
of Commerce) to try and understand the nature of the problem for
small businesses to understand those opportunities, or do you
just talk to the CBI (Confederation of British Industry) which,
with the best will in the world, claims to represent small businesses
but actually represents larger businesses?
Mr Murphy: We have a dialogue with the CBI,
the FSB, the IOD (Institute of Directors) and many others. Could
we do more? I am sure we could; it would be complacent to ever
say you could do no more. The links are very strong; we have tried,
for example, with the FSB to open an online portal in the UK for
UK SMEs to be able to make their own proposals for a better regulation
idea, based on their own experience of, "Why do I have to
do it this way?" whether it is a UK piece of red tape or
an EU-inspired piece of red tape. So we continually look for additional
ways to have a better quality; and it is important to have the
quantity of contact, but improving the quality of the contact
is something in which we are always interested.
Q42 Lord Wade of Chorlton: The sub-committee
I sit on, Sub-Committee G, took evidence from the FSB a few months
ago and they specifically told us then that they found it virtually
impossible for them to give evidence in Brussels on the impact
of legislation or the impact of directives on the FSB sector,
and that they found that it was impossible for them to get their
views listened to or into the system. So are you telling us that
you would specifically go out of your way to change that situation?
Mr Murphy: Your Lordships, that is the first
I have heard of that comment and I would undertake, with your
Lordships' permission, to read that transcript very carefully
and indeed contact the FSB about it.
Q43 Lord Wade of Chorlton: If you would,
we would be most grateful.
Mr Murphy: I will happily do that because when
I was doing the job on Better Regulation at the Cabinet Office
I found it was a great benefit to our work to have the FSB's energy
and in fact frustration, which is often the same thing, frustration/energy,
to drive us on. So I will happily do that.
Chairman: Baroness Symons and Doha.
Q44 Baroness Symons of Vernham Dean: Minister,
paragraph 12 of the Conclusions pledges—and I quote—"
... to strive for an ambitious, balanced and comprehensive agreement
in the Doha Development Round." You seem to have been pledging
this for rather a long time; indeed, I think I was Minister for
Trade at the time of Doha and that is quite a long time ago. What
is the current state of negotiations and do you really have a
genuine belief that they will come to a successful conclusion?
Mr Murphy: The frustration for me, and I suspect
for many of those who follow international development and the
interaction between development aid and trade and the markets,
is that this is another one of those issues that has now been
trapped in a vocabulary which is entirely impenetrable. For example,
on the specific progress that has been made recently your Lordships
would find it interesting, I am sure, but many of those who campaign
on these issues would find it difficult to follow if I were to
share with your Lordships the fact that we do see a significant
progress on the negotiations in Geneva of what is described as
a new Chairs' text on agriculture and non-agricultural market
access, and that is the basis of the ongoing discussions now.
It is frustrating that something as important as this is reduced
to something that is as relatively impenetrable as the text I
have shared with your Lordships. This has been a long process,
and it is reasonable to argue that it is far too long, but we
do remain absolutely committed to a pro-development outcome as
part of the Doha Round and will continue to champion that cause,
but the pace of progress has been painfully slow.
Q45 Baroness Symons of Vernham Dean: Is
there real progress, though, even if it is slow? Is there really
progress?
Mr Murphy: Arising from the progress on 8 February
on that text I referred to, there are still discussions going
on about some of the contentious areas. There is an expectation
that we expect the WTO (World Trade Organisation) to convene a
ministerial meeting possibly in eight weeks or so, which could
pave the way for the deal later this year. So that is the current
expectation, that with this Chairs' text being released and with
conversations going on around the detail of some of the contentious
issues the hope, our ambition would be that that WTO Ministers'
meeting would take place in May. That is our hope and it is what
we are working towards. But I share Baroness Symons' frustration;
I remember being the Government Whip at the FCO when Baroness
Symons was working on this issue and I had not realised that this
number of years later we would still be discussing it.
Chairman: Let us go on. The Commission seems to be
working up a proposal for a new Social Agenda. Lord Wade, would
you like to probe on that one a bit?
Q46 Lord Wade of Chorlton: Thank you, my
Lord Chairman. We would like to find out a little bit more about
your views on the impact of these new proposals for the continuation
of the Social Agenda. When does the Government expect this to
be adopted? Does the Government have specific views on what it
should include? And what relationship, if any, does the Government
expect it to have with next year's budget review? Three questions.
Mr Murphy: And hopefully three answers! First
of all, your Lordships, I should say again that my frustration
at the slow rate of progress in Doha was in no way because of
an assertion, implicitly or otherwise of the work that Baroness
Symons did on the building blocks of delivering it! Having been
through the weeks or years of the Lisbon Treaty ratification process
I am conscious of leaving even a trace of apparent sceptical observation,
so I hope that is absolutely clear—it is despite the work
that Baroness Symons has done, not because of it! In terms of
the specific point on social Europe and the Social Agenda, we
are very confident that Europe should have this social Europe,
social dynamic. Whether we call it social Europe, social dynamic,
flexicurity or anything else is not as important as the content
of it, and our starting point and our position throughout this
will be the most effective way of delivering a social Europe is
to develop flexible markets, complete the Lisbon Agenda, a lighter
touch on regulation, greater flexibility for workers and no new
heavy-handed centrally imposed legislative solutions. In the context
of globalisation that also means that we should avoid, I think
at all costs, the temptation to lurch back into economic protectionism.
So that leads you to the point of what we are talking about really
is a social Europe of maximum employment, including those who
are on inactive benefits, as I alluded to earlier, in terms of
incapacity benefit in the UK. So what is the EU's contribution
without impacting upon Member States' competencies because clearly
most of the competencies are for Member States rather than for
the EU? The competence for the EU is about ensuring that it is
a genuinely competitive, open, flexible market and that the budget
process focuses on worker mobility, skills enhancement, supporting
further projects and programmes such as ERASMUS, to ensure that
that is the type of social Europe that we deliver. It is not the
social Europe of protectionism; it is the social Europe where
we believe in full employment. As I have said before—and
I got in some trouble on this before in some sections of the media,
and again without wishing to draw your Lordships into the party
politics of this—the Labour Party and the trade union movement
was of course founded on the right to work and has never defended
the right not to work—I just do not believe in the right
not to work for those who are able to do so. Therefore, a social
Europe is about supporting people to fulfil that right to work.
Based on the evidence before us in the UK that means flexible
labour markets, completing the Single Market rather than the contrary
approach, which I think is voiced on occasion in other European
capitals which, based on the evidence, is not anywhere near as
effective, which of course is protectionism and rigid labour markets.
In terms of timescales there is a relationship between this of
course and the budget review and it is a debate that, as your
Lordships are aware, is not new and will really continue into
and beyond the budget review; but how it is captured in the budget
review we think is a greater focus for mobility of workers and
skills across the EU.
Q47 Lord Wade of Chorlton: To sum it up,
you are really saying that it is an economically driven social
improvement; that we improve the wealth of Europe and we improve
the social benefits as a result?
Mr Murphy: Improve the wealth of Europe and
in doing so simultaneously improve the skills capacity of the
European workers and do that simultaneously, and I think we are
in the right place. I have reflected on before—and I think
your Lordships may have read or heard me say something like this
before—that across the European Union there are 92 million
economically inactive citizens—92 million. I am not putting
a figure as to what the preferred number is but these are 92 million
economically inactive that are not classically unemployed, but
that is more than the population of all of Scandinavia and the
ten new Member States of the European Union combined. Does that
feel about the right number? Of course it does not. And as we
have our own labour market reforms in the UK—perhaps belatedly
in terms of inactive benefits—I think there is an equal
challenge for all Member States of the European Union to get this
right.
Q48 Lord Wade of Chorlton: But you would
not expect that it has a big impact on any change in the UK because
this is very much, is it not, the policy now?
Mr Murphy: It is very much the policy now but
there could be changes based on the sharing of best practice.
If as part of this dialogue we discover that in Germany, Italy,
Slovenia or somewhere else there is a remarkable innovation in
the labour market or in the skills capacity I think there is no
difficulty in sharing best practice. So that is the extent of
change. Will there be a centrally imposed legislative solution
to this? No, there should not be.
Chairman: We have the Minister for a maximum
further 40 minutes and we have several substantial questions to
get through, so let us make progress. Climate change and energy,
Lord Sewel.
Q49 Lord Sewel: Minister, the Council, as
I understand, welcomes the report by Commissioner Ferrero-Waldner
and High Representative Solana regarding the impact of climate
change on international security. It was a pretty frightening
report, was it not—almost at the gates of doom really? So
the first question is does the United Kingdom Government agree
with that analysis? And the second question obviously is, if you
do agree with it what are you going to do and do you think that
the EU needs to sharpen up its act in integrating its approach
to how environment issues can impact on security issues?
Mr Murphy: We strongly welcomed the report because
of the quality of it but also because of the message. It is a
wake-up call, if it were needed, to some in the EU and beyond
because it is a report read not just with impact in the EU but
beyond. The two things in particular that are important are about
mainstreaming the climate change debate as a national security
issue, as an issue on migration, on energy, and mainstreaming
it in that context. So that is one of the particular things that
we welcome. Secondly, specifically the High Representative has
been tasked to submit specific proposals and recommendations for
follow-up action arising from the report, and that is strategically
a crucial piece of work. I think importantly within that is a
regional analysis—region by region—as to the implications
of climate change in different regions, whether it is water shortages,
food shortages, movement of people, energy, water levels, so that
there is that kind of one size fits all analysis. But it is an
important and welcome piece of work which now has to be built
upon.
Q50 Lord Sewel: Just to draw out from that,
it is not too difficult to see competition for water resources,
energy resources and food resources as being the three factors
which are most likely to impact on international security in the
decades to come.
Mr Murphy: My frustration on the debate on climate
change would be—and, again, this is not meant to be dismissive,
but just a personal observation, and let me say first of all that
I like polar bears—that on occasion it is too often focused
on polar bears. It is not about enlightened self-interest, it
is not about economic self-interest or the national security of
self-interest, it has in the past in previous years been about,
"Let us do the socially responsible thing for socially responsible
purposes exclusively." We are all in that place, we are all
willing to do our bit in that context, but to get the degree of
change in governments but possibly more importantly in the behaviour
of citizens across the globe and across the EU, it has to be more
than just do the right thing for the right reasons—it also
has to be about enlightened self-interest. That is about mainstreaming
climate change which is a genuine and strategic threat to our
nation's future, our nation's economic future and our nation's
security future, and I think that is what this report helps to
do.
Chairman: Targets for renewables, Lord Kerr.
Q51 Lord Kerr of Kinlochard: Minister, I
am trying to work out what is new in the Conclusions of this European
Council on the energy/climate change front. I cannot find any
new target. I am pleased not to find any carbon tariff and I am
pleased not to find any carbon energy taxes. I see a lot of stress,
which seems good to me, on competition in network industries,
and a sort of commitment to reach political agreement on the gas/energy
third package, including interconnection, by June, which seems
to me good. But I see a lot of other things which look to me to
be simply repeating what I have seen before, in particular in
the spring 2007 European Council Conclusions. Have I picked out
the right new things? Is there something big and new that I have
missed? Is there anything that you would like to tell us about
what this European Council achieved on climate change and energy?
Mr Murphy: I think what is significant first
of all is that there was not, if you like, an unpicking of previous
declarations and commitments and that is very important. Governments
have had the months to reflect since the previous Council and
the genuine realisation of the size of the challenge we have set
ourselves could have led to a much more difficult discussion and
set of Conclusions, which suggested the need for a pause for thought
and reflection. Those debates still continue, of course they do,
particularly amongst some of the Central and Eastern European
Member States—the fact that the EU remains committed in
principle to its previous agreements, the fact that, to be frank,
the most significant climate change renewables and measures come
out of the Council. In addition to that the point made in the
question is absolutely fair, that there is the other significant
thing by virtue of the fact that there were not any additional
add-ons. The Council can either have unpicked previous agreements
or decorated it with hindrances to such an extent that would make
it either undeliverable and devoid of purpose or real meaning,
and that did not happen either. The final point is, specifically
on the proposals for some sort of border tax, that that proposal
was put forward and it is a proposal that when I was in Paris
a fortnight ago the Europe Minister in the French Government,
Jean-Pierre Jouyet lobbied me on, we pushed back on and we continue
to push back on. We think tactically, in the short to medium term
at the very least and probably on a longer scale than that, that
is the wrong-headed way to go about this. We cannot expect international
cooperation on climate change, technologies and on renewables
in the context of punitive tax proposals which will then lead
to international recrimination. It also sends a message to the
rest of the world that Europe can only deliver on renewables in
a way that hurts our economy and as a consequence we will take
these protective tax measures, and I think that other countries
and other global trading blocks would then respond in kind, and
I think that is a very unhelpful way for us to progress. The important
thing is we did not unpick the previous agreement and we did not
add to it in a way that was unhelpful.
Q52 Lord Kerr of Kinlochard: I agree. I
do not mean to be critical; I think that is very sensible. I did
spot what seemed to me to be two slight changes of tone. One was
the emphasis on flexibility in how Member States achieve targets,
which fits with what the Reform Treaty, as you will be all too
aware, Minister, says about Member States being absolutely entitled
to set their own energy mix; there seemed to be rather more about
flexibility as to how you achieve targets. Secondly, and particularly
on biofuels, I thought that while there is no resiling on the
commitment to ten per cent in transport fuel; there is quite a
lot about the need to have greater synergy between climate change
and biodiversity policy and to ensure effective sustainability
criteria in meeting the ambitious target for use of biofuels.
Am I right that that is a change of tone, and do you think it
is a significant one?
Mr Murphy: On those two points I am glad your
Lordship has acknowledged the responsibility for the deployment
of an energy mix remains an issue for Member States, but I think
it is inevitable—and I think it is a welcome inevitability—that
as we look into the detail of how this target will be delivered
that there is Member State flexibility—flexibility on how
to encourage uptake of renewables and flexibility as to the different
sectors of demand and the most effective ways in each Member State
to drive delivery of the renewables targets. That flexibility
I think was welcome and probably inevitable as we get closer to
working through the detail. In terms of the point about biofuels,
I am willing to acknowledge to your Lordships that I am relying
on scientific advice available to the FCO—it is not something
in which I have a personal detailed background in terms of the
interaction between climate change and biofuels—and the
evidence provided by the scientific community is that there is
a greater climate change benefit, if you wish, from second generation
biofuels and on that basis I think it is right that any attempt
to go towards a more ambitious biofuels target upon the ten per
cent should wait until we know the exact benefit of second generation
biofuel deployment, and that is what the statement says there—an
acknowledgement of the science of biofuels and the science should
drive any advancement on the ten per cent target.
Q53 Lord Sewel: Can I take up the issue
of the targets, the 20 per cent overall target for renewables
and the ten per cent for biofuels for road transport? Surely in
combating global warming and climate change the key, if not the
only things that matter are the global aggregates, and therefore
it seems absolutely right and sensible to set overall emissions
targets, allocate those to Member States and allow the Member
States to decide for their context which is the most economic,
effective and efficient and sustainable way of achieving them
and not go down into particular targets for particular renewables
for particular fuels.
Mr Murphy: I think that is the right way to
progress. I think, with respect, that is what we are trying to
do. There is a conversation that continues in European capitals
about this, but I think the balance of opinion fundamentally is
very strongly in our favour, this degree of flexibility. Perhaps
a year or so ago that may not have been what the debate was but
as governments across the EU start to consider just how they would
specifically deliver the renewables target there just is not a
one size fits all. I met with the Finnish Europe Minister, who
said—and again I am not a spokesman for the Finnish government
so I do not want to misrepresent the comments—in general
terms that without the flexibility that is sensitive to the nature
of what Finland has already achieved and the structure of the
economy of Finland it would be very difficult for Finland to make
progress on these issues. On the specific point about flexibility
in the UK—and Burke is considering estimates about wind
power contribution, which I am advised that to electricity generation
we are in the region of 30 per cent, which is of course beyond
the UK 16 per cent target. So, again, that is an example of the
flexibility that the UK would seek to deploy. The final point
on this is that this is about deliverables and improvements but
it is also about leadership. If the European Union, Heads of State
and Government sign up to bold targets and then resile from them
and a difficult decision is needed to achieve them, I do not think
we can expect in any sustained way for the rest of the world to
then play its part in the post-2012 international deal, because
without the EU delivering importantly I am not sure about what
is the architecture of an agreement that then gets the US, Japan,
Russia, China and other economies to play a part in this as well.
So it is important that we deliver and also lead.
Q54 Chairman: Before going on to carbon
leakage, which I find a most regrettable addition to our international
lexicon, I must say, could I just slip in a question about VAT
concessions on eco-friendly goods. This seems to have dropped
on the Council from out of the clouds, the Prime Minister's proposal,
and it did not go down well with everybody, particularly not the
Germans. I notice in the Prime Minister's statement made in your
House and read in ours that when the Commission comes to deal
with its summer legislative proposals on the VAT that they might
be including this as some sort of an addition to their regular
examination. Is the Government placing high hopes that something
like VAT exemptions for eco-friendly goods might be included?
Mr Murphy: I think it is something about which,
along with some other Member States, we remain very enthusiastic.
There was not a concrete conclusion of specific deliverability
on VAT or on climate change-sensitive goods but it is something
that the Council agreed we should return to. On all of these things
of course you will want to see progress as quickly as is humanly
possible but I think we have registered that there is an agreement
to return to it and we will exploit to the full the opportunity
that has now been opened. It is part of the mix of climate change
efforts by the EU that we think is important and it is a view
that is shared by some other Member States as well.
Chairman: Thank you, that is clear. Lord Plumb, carbon
leakage.
Q55 Lord Plumb: It naturally follows, I
think, the question that Lord Kerr put and of course runs on from
dealing with emission reductions. You are stepping into very much
an unknown field I think because there will be a lot of mixture
before we are through on this one. But on carbon leakage at least
the EU is setting a lead and therefore there will be an exposure
to international competition. I think, on this, one is bound to
be concerned that short of allocating free emission permits to
businesses in those sectors, what do you consider other policy
options might be and can they be used to address the problem?
And if some proportion of emissions permits continue to be allocated
for free, will this not undermine the proper functioning of the
EU Emissions Trading Scheme?
Mr Murphy: The important point we wish to continue
to get across to other governments in the EU—and obviously
I mentioned this in passing answering Lord Kerr's question that
you have alluded to, Lord Plumb—is that a policy should
follow the evidence here. The evidence based on the research that
we commissioned was that there are a few sectors that may be affected
and it may be helpful to your Lordships if I place on record what
some of those would include: they would include the sectors covering
cement, iron and steel and some others, but those are the three.
Our alternative approach is to seek international sectoral agreements
on these issues so that these punitive tariffs, border tariffs
would not be necessary. I think it is accurate to suggest that
those countries that are most enthusiastic about climate change
tariffs, border tariffs of this nature, and on occasion are also
those countries that are most enthusiastic about a protectionist
and economic posture more generally. I think there is a legitimate
conversation to be had about to what extent is a climate change
tariff a proxy for general concerns about international economic
globalisation in any instance. Of course, the major stated public
concern about the EU delivering on climate change in this way
is that it is not about carbon leakage. Carbon leakage, of course,
is another way of describing jobs leakage to those economies that
are not as proactive on climate change as the EU would be. We
are not interested in seeing a European Union accept that economic
architecture that says we should not act because the whole world
will not act. So what is the solution? We see the solution as
evidence-based, following the signs on specific sectors rather
than a complicated set of international, multilateral and bilateral
border tariffs. I think in doing that, as I said in response to
Lord Kerr earlier, we do not send a message to the rest of the
world, the US and elsewhere, and China, that to do the right thing
would be expensive and to do the right thing by necessity leads
to the need for significant economic adjustments and that degree
of tariff retaliation. So I think the best way is to follow the
signs of the sectoral agreements across the globe, so that is
what we continue to work on. We have said to the French and others
who are interested in this that it is not something we wish to
follow.
Q56 Lord Plumb: In other words you are hopeful
that the European Union would set an example, but to what extent
do you think that countries like China are going to follow?
Mr Murphy: Obviously the Foreign Secretary and
the Prime Minister have both been there recently and it is our
assessment that the Chinese leadership have decisively made the
intellectual leap towards the need for action on climate change.
Equally frankly, the assessment is perhaps from a different perspective
to the UK. Their assessment is on occasion driven by the remarkable
increase in the cost of food in China, driven partially by population
growth but largely actually by the impact of climate change on
agriculture. So with China potentially the way in there on climate
change is about food shortage/food pricing. Equally in Russia
the way in there would be on energy efficiency and the capacity
of their energy sector to be able to fulfil its international
commitments, and with the current degree of energy inefficiency
in Russia it is difficult to see them meet their international
obligations. So I think there are different ways into the same
argument in different capitals and in different populations, and
China is an excellent example of it.
Chairman: Thank you very much indeed. Could we move
on to the Union for the Mediterranean and Baroness Symons?
Q57 Baroness Symons of Vernham Dean: Minister,
the Union for the Mediterranean, largely accredited to Mr Sarkozy,
all the diplomatic chit-chat is that perhaps there are a number
of different views about the merits of the scheme within Paris
itself, let alone anywhere else. I wonder what you can tell us
about the disagreements and agreements that there are, the matters
of contention over this that surfaced at the meeting; and what
the UK's position is on the objectives and the financing of the
project which I heard recently described as, I think, the "small
tombstone" on the whole project itself, and when you look
at how much was devoted to it in the Conclusions perhaps that
is a reasonable conclusion for us to come to.
Mr Murphy: I cannot add to the diplomatic chit-chat
or the undiplomatic chit-chat, certainly not in this gallery but
perhaps on another occasion. The sense was that President Sarkozy
of course made his statement I believe on the Mediterranean Union
and it was important that the detail was then followed up. That
detail is now much clearer and where we are now is that the Mediterranean
Union is not now the property of France, it is not a French proposal,
it is in the ownership of the European Union, and that is important,
based on the way that these things are dreadfully described, based
on the Barcelona Process. If there was tension at the Council
meeting the tension was—and I think this may have been reflected
in some media coverage, I am not sure—that obviously there
are two discrete areas of the European Neighbourhood Policy, that
to the south and that to the east. There was a worry—I think
voiced most vocally by Poland—that we should not be favouring
one aspect of the Neighbourhood Policy over another, and as a
consequence there is a proposal to return with what are the impacts
to the Mediterranean Union on the European Neighbourhood Policy
in the east. The UK's position has been that the Neighbourhood
Policy to our east and our south should not be seen as competition;
we should not favour one over the other; the Neighbourhood Policy
should not be an alternative to membership of the European Union
and now the Mediterranean Union should not be seen as an alternative
membership of the European Union in time, and we are very clear
about that. But now the rest of the European Union is equally
clear about that—this is not an alternative to membership.
In terms of funding, once we have worked through the specific
projects that we seek to do then we will work through the funding
sources for it. But those are the principles; the principles are
no competition between the east and south; the principle is it
is not an alternative to membership; and the principle is it is
not owned by one Member State but is the property of all the European
Union and I think that is now clear and we are actually very content
with that outcome.
Q58 Baroness Symons of Vernham Dean: Is
it better that it is the property of the whole European Union
because that facilitates a decent burial?
Mr Murphy: It is important that we all share
in the responsibility to make it effective.
Q59 Chairman: But is it clear that it is,
so to speak, budget neutral; that is to say, that it all has to
be accommodated within whatever the Lisbon Process manages to
get into its coffers?
Mr Murphy: There is not an additional source
of income as a consequence of this.
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