Examination of Witnesses (Questions 40-59)
15 JANUARY 2008Mr
Jim Murphy, Ms Shan Morgan and Mr Adam Bye
Q40 Lord Harrison: I fear we are counting
red herring and not cutting red tape!
Mr Murphy: Hopefully we can prove you wrong!
Q41 Chairman: Let us go on to climate
change. Minister, the Council concluded that the Bali Conference
must respond to the urgent need for global action on climate change—that
is not very surprising. I wonder whether you think that the results
were satisfactory? After that I would like to ask you a couple
of questions about the United States and some other big countries.
What is the Government's view on the results?
Mr Murphy: I think that the outcome was much
more optimistic and specific than was expected perhaps, certainly
three months before and perhaps even a couple of days before.
On occasion, from listening to the experience of UK Ministers
who attended, perhaps at different hours during the marathon negotiations
there were points at which there could be a great deal of pessimism.
But there is a sense that progress was made and that we will move
towards Copenhagen in 2009 with trying to negotiate the specifics
of the post-Kyoto Agreement. So there is an acknowledgement in
principle that there have to be deep and substantial cuts in global
emissions. I think there was a general acceptance that there was
a great deal of acknowledgement of the scientific case; and there
was movement in some Member States, helped—without passing
judgment on the Australian elections—of course by Australia
adding itself to those who see the case for the initial Kyoto
Agreement. But there is still a substantial piece of work to be
done and we watch with great interest the conversation in Canada,
for example, and the twists and turns of the US election process.
Q42 Chairman: It is clear, is it not,
that the United States was absolutely bowled over by the size
of the cuts in greenhouse gas emissions demanded, and we know
that the percentages then got relegated to footnotes, etcetera,
so some effort was made to calm them down. But is not the problem
really that there is no chance of the US Congress ever ratifying
a Treaty that does not demand from countries like India and China
that they make comparable efforts? Did we get the impression at
Bali that India and China were going to play ball?
Mr Murphy: On China in particular I think that
the Chinese Government has intellectually persuaded itself that
there is a need for domestic and international action, so I think
that was important. I am less clear about the specifics in respect
of India. In terms of the US I think we will all watch with great
interest the different aspects of the election process, but there
are a number of US Presidential candidates, both Democrat and
Republican, who are determined to see the US play a more constructive
role internationally on this. Again, without wandering into the
Serbian elections and certainly without wandering into the US
elections, there are signs—without being naively optimistic,
not least in terms of the Senate—with individual states
in the US taking unilateral action, and with climate change being
on the US Presidential agenda in a way that we could not have
imagined four years ago, that gives us reason to be relatively
optimistic. Also, the international community has been bound into
a process leading to Copenhagen. There is an awful lot of work
to be done, however, before we get to any agreement in Copenhagen
next year.
Chairman: Let us go on to the European Institute
of Innovation and Technology, this rather controversial body.
Q43 Lord Wade of Chorlton: We noticed
that the Council welcomed the setting up of the European Institute
of Innovation and Technology as agreed on 23 November, but you
may be aware that this Committee had some serious concerns as
this project came through, as did the Government. I would be interested
to know, now that the agreement has been reached, does it, in
your view, represent good value for money and how does Her Majesty's
Government plan to monitor the success and the efficiency of this
Institute?
Mr Murphy: Your Lordship is right in that the
Government shares a number of concerns, but the proposal as welcomed
at the Council is a significant move away from the initial Commission
proposals in a number of important ways. We successfully argued,
for example, that there should be a series of pilots rather than
one giant leap and that was accepted and the number of pilots
that would be of value before further progress is made. That is
one substantial change. The second one is that it was not new
money; no increase in budget and would come from existing budgets.
Again, that was not the initial approach from the Commission,
but again we managed to persuade, with others—not by ourselves
but with some others—that that would be the correct approach.
In principle, however, if these pilots and their evaluation are
productive then potentially it can feed into the Lisbon Agenda
and the Single Market about which we speaking earlier, but it
is only if the evaluation proves the pilots to be worthwhile I
think that is the correct approach.
Q44 Lord Wade of Chorlton: The view of
our Committee was that these sorts of activities are much better
done at local level. It is local initiatives that create new innovation,
new developments and new technology and local money. Would you
agree with me that the success of this European project will be
how much it encourages local activities and does not try and concentrate
on centralised activities?
Mr Murphy: I think there is a case for a European
framework. I spoke earlier about the patenting regulations there.
I think there is a need for us to move, for example, and then
that would encourage innovation. I think the basic premise of
your Lordship's question is a fair one, that you cannot command
innovation. It is not a nationalised industry where you can command
the will and command creativity; it is about human spirit and
human innovation and great ideas, and the European Union should,
where it can, encourage that.
Q45 Lord Powell of Bayswater: I want
to follow that up. At a time when many companies here are reproaching
Government for not providing enough support for research and technology
in this country over innovation, and as a result many companies
are moving jobs in this field overseas to the United States or
to Asia, does it really make sense to support this at all? Should
we not perhaps at least have registered our opposition to it and
try to persuade people that really there does not have to be a
European everything?
Mr Murphy: There certainly does not have to
be a European everything; that is very clearly the Government's
view, for example, on a European Public Prosecutor—you do
not see the case for that, for example. On this we took the judgment
that we could change the proposal so dramatically that potentially
it could have a positive impact, but if the evaluation of the
pilots concludes that there is no value added then I think in
that case it is strengthened, and I expect your Lordships to look
in great care to the evaluation of these pilots.
Lord Powell of Bayswater: Perhaps the
Minister would like to take a bet as to whether there is going
to be a negative evaluation of the pilots, but I would not put
much money on it myself.
Q46 Lord Wade of Chorlton: It will depend
on the assessors. Let us hope that the assessors are those who
might make benefit from it and not those who are delivering it.
Mr Murphy: Your Lordships and your Lordships'
Committee will be part of the assessment process.
Q47 Lord Wade of Chorlton: That will
be all right then!
Mr Murphy: I would bet on that anyway!
Q48 Lord Dykes: Further to that, do you
mean, Minister, that there is a chance that it will not go ahead,
it will depend exclusively on those pilots? Because if they are
presumably going to be firmly embedded in private/public cooperation
on specific, fairly small projects it is more likely that at least
a number of them will be successful. This has been quite carefully
thought out over a long period, and is it not therefore the supposition
that from that Council decision this Institute will go ahead?
Mr Murphy: We would not move on to any future
expansion of the Institute without a detailed assessment of the
pilots and efficacy of the evaluation process; so once that has
concluded—and I cannot share with your Lordships today the
timescale of that—at that point we can say whether to go
further or not.
Q49 Lord Dykes: With your indulgence,
Lord Chairman, what would your guess be—and not holding
you too tightly to a specific date—if that was okay and
a date was fixed for it to start?
Mr Murphy: I do not have a guess but I will
return to your Lordships in writing, if your Lordships wish, with
something better than a guess.
Q50 Lord Dykes: Incidentally, depending
on when it was set up, of course the decision was at paragraph
43 of the Presidency Conclusions to go ahead with the Galileo
Project and that will be by 2013, so maybe one of the Institute's
functions will be to monitor how that is developing. Could you
very quickly on Galileo say what the feeling now is? It did look
expensive prima facie, but then so is the American
system. Do you feel now that they will go ahead without significant
delay from now on?
Mr Murphy: I think there was progress in Galileo,
I think it would be with the Transport Council—I am not
certain—before Christmas, but I will invite Shan Morgan
to say a word or two about Galileo.
Ms Morgan: Just to say that both Galileo and
the European Institute of Technology would agree together the
budget for them and the same conditions applied to that, that
there was very strict budgetary control, and the funding was found
in the margins of the budget for 2007 and 2008 and by re-profiling
existing research funding that had already been foreseen for Galileo.
Again, if you would like more information on that process then
we can follow it up in writing.
Q51 Lord Dykes: 2013 is a firm, reachable
date for commencement, is it?
Ms Morgan: That is expected to be the case,
yes.
Q52 Chairman: If we could move on to
our last two issues which we want to raise with you. Minister,
we would be interested to know the degree of joy with which the
UK participated in the welcoming of the ongoing consultations
on the Social Reality Stocktaking. I am sure that you would have
no real objection to that consultation going on, but are you not
a bit worried about what all of this may lead to, a renewed and
modern Social Agenda for Europe?
Mr Murphy: My Lord Chairman, I think unbridled
joy! This is one of those phrases that Europe generates, which
lack precision and clear definition. For us, what does this mean?
Ultimately Social Reality Stocktaking, as I understand it as it
is set out, is about social wellbeing which we wish to tie back
to the Lisbon Agenda, the completion of the Single Market, a chance
to get a job and a chance to get a career, ultimately. If it is
a European index of contentedness, which it is not but which some
people argue that it should be, then the evidence in the UK is
that in general terms the greatest driver of contentedness is
having a chance to have a job, and that takes us straight back
to the Lisbon Agenda and the completion of the Single Market,
and that is the case that we will continue to make. Do we think
it is an opportunity for protectionist pressure? The evidence
so far is that it has not been a rallying point for any concerted
attempt to revisit some of the in-principle agreements on a Single
Market and a Lisbon Agenda. So while I think that the phraseology
and the terminology are unhelpful and imprecise I think the content
of it is something with which we are comfortable.
Q53 Lord Tomlinson: I was just wondering,
Lord Chairman, whether Social Reality Stocktaking will ever become
a paradigm example of better regulation?
Mr Murphy: I think better regulation means what
it says and it says what it means, so I do not know what this
says in the sense of Social Reality Stocktaking. If we picked
up any evidence in the UK which is the most dangerous profession
in the UK it is unemployment. That is the most dangerous profession
in the UK; it is not heavy industry, it is not many of the other
things that we traditionally consider. Unemployment is the
most dangerous profession in the UK and if it picks up on that
sort of evidence in terms of social reality then we are very comfortable
indeed.
Q54 Lord Plumb: I do not know how you
assess social reality when in fact the majority of support going
into rural areas is a social policy rather than an economic policy.
How on earth do you add that to an assessment of a general social
policy over all people? It would be not just a complex issue but,
I would have thought, an absolutely impossible task to make any
sort of assessment at all.
Mr Murphy: I think your Lordship is right; it
would be very difficult to reach a universal conclusion as to
the definition and nature of a social reality. We are in this
conversation because I volunteered to be in this conversation,
but I will make do with what is there. For us, we want to tie
it back to the type of things we have been speaking about already.
It cannot be an index of happiness, which is what some people
have spoken about. That is the important conversation; it is an
important issue but it cannot be a league table of European happiness.
Lord Plumb: Exactly.
Q55 Chairman: It looks like we may be
coming up to a division in the Chamber fairly shortly, so could
I go to the last question, which is about Felipe González's
Independent Reflection Group. I was interested to read a fairly
long article in the Financial Times about this this
morning where he sets out some of his views on what he plans to
do with it. It is an awfully watered down mandate and maybe that
is a good thing, but will it come up with anything useful? Presumably
it will not be binding on anybody; is this simply just going to
be a series of reflections?
Mr Murphy: It is not binding, that is true.
We are very happy with the terms of reference, which set out what
our terms of reference would include. It was a French proposal,
as your Lordships will be aware. Our concerns were that it would
be another attempt to revisit Treaties; it would be a proxy for
discussion on budget; and it would be used potentially to unpick
the existing commitments, not least accession for Turkey. Explicitly
those are excluded and we are very happy with that indeed. In
terms of Felipe González and his comments to the FT,
we are going to be engaged in this process; we hope to shape it
and we have been very, very effective—along with some others—in
shaping the terms of reference, and that was the most significant
thing here, shaping the terms of reference, and that has been
achieved.
Q56 Chairman: It looks, from what I read,
that he wants to deal with some very current problems—he
talks about corporate rigidity, the failure of the Lisbon Agenda;
he talks—and this is very welcome—about making much
more progress on better regulation. So he is dealing with current
problems, it sounds, rather than looking to the future of Europe.
Mr Murphy: I think the danger with having a
former prominent politician is that they would seek a permanent
legacy and the signs thus far are entirely contrary to that—very
positive. And the fact that we also have two excellent Vice Chairs
is a good sign for this group. So I think we can have a degree
of confidence based on the personnel but obviously the terms of
reference. I think the worries that your Lordships may have shared
about this Reflection Group have been overcome.
Lord Tomlinson: A Reflection Group, as
I understand it, is supposed to be reflecting on the decade from
2020 to 2030. Do you see great utility in this when every participant
in the Reflection Group, by the time their reflections are tested
against the then current reality, are either dead or out of circulation?
Q57 Lord Harrison: Or in the House of
Lords!
Mr Murphy: I am not sure that that is fair!
The fact is that this can potentially be an important piece of
work, particularly in that timeframe, because if we carried out
an equivalent piece of work 20 years ago in terms of the European
Union arguably it would have put us in a stronger position, particularly
in respect of economic and—something we do not talk enough
in terms of globalisation—cultural globalisation. So I think
it is potentially a very important piece of work.
Q58 Lord Tomlinson: If we had done it
20 years ago we would have been doing it in the circumstances
of a Europe that had not contemplated the Berlin Wall and the
consequences that flowed from that, had not contemplated the expansion
of the European Union and we would not have got any of those things
right.
Mr Murphy: No, but we would have been able to
position Europe as it was, as a geographic and economic entity
as it was at the time, arguably in a much better position vis-a"-vis
competitiveness from North America. We did not do it; we should
have done—on reflection we should have done.
Q59 Lord Jopling: Minister, we have talked
about a Chairman and two Vice Chairmen, and it says that there
were to be no more than nine Members selected from across the
Union on the basis of merit. Do we have an agreement that there
will be a representative of the United Kingdom on this group?
If not, why not? If so, who are you going to nominate?
Mr Murphy: A very short question—I do
not know the answer. The fact is that we have agreed that there
will not be 27 Members; we have agreed that there will be nine
Members, so there will not be a nominee for every Member State.
The fact is that we have not yet taken a decision as to whether
we would nominate someone; we are working with other European
governments as to what the correct make-up would be. If we were
to nominate someone we have made clear at the outset that we wish
to see some business people on this Reflection Group. The fact
that we have the ex-Chief Executive of Nokia and now of Shell
as the Vice Chair is, I think, significant. But if we were to
nominate someone the type of person we would be looking at would
be someone like Nick Stern in terms of an environmental dynamic.
We have not taken a decision in principle to nominate or in specifics
to nominate, but we have said that the Committee should reflect
a business experience and someone who understands the challenge
of climate change.
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