First of all, I can quite understand the desire to see an in/out referendum on Europe. Some of you who have contacted me also pushed hard for a referendum with an additional choice of repatriating powers from Brussels and assuming what would effectively be associate membership.
My own views on Europe are very well known in the constituency, and whilst I listened carefully to various advice from many constituents, I have taken the view that now is not the right time to push for such an initiative. After all, Europe is currently facing an incredibly grave sovereign debt crisis. The Euro is in a very bad way indeed and although EU leaders did come up with emergency measures at the recent summit, there is still a very strong likelihood of default in a number of
southern European countries.
Some people say that this does not really affect the UK and we can sit back and just watch it happen. Unfortunately, we just do not have this luxury because, with over 40% of our trade going to Europe, if Europe goes into recession again it will undoubtedly drive the UK economy back into negative
growth. This would be exceptionally bad news at a time when the Government is working desperately hard to get our budget to balance, retain our AAA credit rating and push for growth in the economy. Although it is very good news that we are not actually in the Euro, what happens in the Euro zone is bound to have a profound impact on our own economy.
This is why all effort and emphasis must be placed on Europe sorting out its current sovereign debt problems, and I also support the Prime Minister’s commitment to look urgently and carefully at any European directives and regulations that impinge on our SME sector.
We have already made big changes to where the country is going on Europe, and not just with the referendum lock. Where Labour let the cost of the EU budget grow and grow we are bringing it under control, saving hundreds of millions of pounds from what Labour committed us to. Labour enmeshed us in EU bail-outs but David Cameron won agreement to get us permanently out of those liabilities. This is saving the taxpayer cash at a time when we having to count every penny.
The Eurozone crisis is almost certain to mean that we will see a number of changes in the EU in the years to come. We should take advantage of them to advance our national interest. We need to think about what is most important for our country, so our first priority is to make sure that what happens as the Eurozone changes does not allow countries in the single currency to impose decisions on countries outside it: the Single Market is hugely important to our economy and was the reason we joined in the first place. Second, we need to ensure that Britain’s leading position in financial services is recognised and protected. Beyond that, I think we should look to reduce the EU’s powers in Britain in other areas, most importantly in social and employment laws, where EU interference is doing real harm.
Finally, as you can see, I am attaching a copy of the speech that William Hague made during the debate. As I am sure you are aware, he is someone who fought tirelessly to keep the UK out of the Euro and furthermore, he has consistently argued for a “Britain in Europe but not run by Europe.
Hansard 24th October 2011 4.54 pm
The Secretary of State for
Foreign and Commonwealth Affairs (Mr William Hague): It is a pleasure to follow the
hon. Member for Lanark and Hamilton East (Mr Hood) and his shocking revelation
that there are tabloid newspapers that wish to leave the European Union. This
is an important issue at a critical time in European affairs and I congratulate
my hon. Friend the Member for Bury North (Mr Nuttall) on securing the debate
and moving the motion, even though, as I will explain, I disagree with it. As
so many Members wish to contribute to the debate, I have given you, Mr Speaker,
an undertaking that I will speak from the Front Bench for no more than 25
minutes—less, I hope—including interventions. I apologise for having to leave
for Australia before the end of the debate.
Hon.
Members who have put their names to the motion have done so for reasons that
are honourable and passionately held. I wish to set out briefly six reasons why
I believe the proposition to be the wrong one at the wrong time and why it
would cut across a European policy that I believe has the best chance of
success for this country. The starting point must be the recognition that
disillusionment with the European Union in this country is at an unprecedented
level, and in this regard there is some common ground between my hon. Friend
the Member for Bury North and me. Just as I want to say some things that he and
others will find difficult to accept, so I put it to those who have always
enthused about the prospects for greater European integration that for this
country the limits of such integration have been reached—more than reached, in
my view.
The
Leader of the Opposition said at the weekend that he did not rule out joining
the euro in future. He must recognise that he is totally out of touch, not only
with the people of Britain, but with economic reality. That is why the coalition
Government—this is the first part of my argument—have already brought about a
major change in European policy, which is absolutely in the interests of this
country but which the motion would cut across. That change has three aspects,
which I will set out briefly. First, following the previous Government’s
refusal to hold a referendum on the Lisbon treaty, we passed the European Union
Act 2011, which sets out that, in the event of a Government proposing any
further transfer by treaty of powers or competence to the EU, there must by law
be a referendum of the British people.
Dan Byles (North Warwickshire)
(Con): My right
hon. Friend mentioned the Opposition’s view. Does he not share my bewilderment
that the Leader of the Opposition, in response to the Prime Minister’s
statement earlier today, appeared to say that the Prime Minister should not go
into EU meetings and be robust in the British self-interest in case he upsets
the French?
24 Oct 2011 : Column 53
Mr Hague: Well, I never cease to be
bewildered by the statements of the Leader of the Opposition, so we will leave
him to worry about that himself.
Any or
all of the treaties of the past 20 years would have been caught by the 2011
Act, and under the same Act parliamentary scrutiny of any treaty changes was
vastly enhanced. The narrow treaty change that has been agreed to set up the
European stability mechanism will now require primary legislation to be passed
through both Houses of Parliament, rather than the cursory consideration it
would have received under the previous Government.
Mr John Redwood (Wokingham)
(Con): Does the
Foreign Secretary not see that very substantial transfers of power are going on
at the moment under this Government by directive, by regulation and by opt-in?
Why can we not have some lock or vote on that?
Mr Hague: As my right hon. Friend knows,
we are also improving the scrutiny of opt-in decisions by this House and made
some important commitments on that during the passage of the 2011 Act. On
financial regulation, as he may know, my right hon. Friend the Chancellor has
had a series of negotiating triumphs that have turned around the situation
regarding directives that threaten this country’s financial services industry.
Several hon. Membersrose—
Mr Hague: I will give way to the right
hon. Member for Rotherham (Mr MacShane), but then I will make a lot of
progress.
Mr MacShane: Is it now the Foreign
Secretary’s view, and that of the Prime Minister, as he seemed to indicate in
his statement, that we should have had a referendum in 1985 on Mrs Thatcher’s
Single European Act?
Mr Hague: I have just stated my view,
which is that all the treaties of the past 20 years would have been caught by
the 2011 Act and that there would have been a referendum.
Secondly,
we have negotiated far harder and far more effectively on the European budget,
in which the increases proposed have been totally unacceptable to this country.
Working with France and Germany, the Prime Minister has achieved a sharp
reduction in the EU’s budget increase and a united demand for a real-terms
freeze in the seven years from 2014 without making any concessions of our own.
Thirdly,
we have used and will use any treaty change asked for by others to protect and
advance our own national interest. The Prime Minister has secured agreement
that, in return for accepting a legal basis for the European stability
mechanism, Britain will no longer be liable for future eurozone bail-outs
through article 122—a liability that the previous Government agreed to in their
dying days.
Several hon. Membersrose—
Mr Hague: I am going to proceed for a
while, given the time constraints. I will give way again a little later.
We have,
therefore, already saved the British taxpayer potentially billions of pounds.
None of those three major advances for British interests would have happened
24 Oct 2011 : Column 54
under the
previous Government, because they actually did the opposite: refusing to hold a
referendum; giving up £7 billion of rebate in budget negotiations for nothing
in return; and signing us into a eurozone bail-out.
We
propose to approach further treaty changes in the same firm and clear manner.
We have agreed in the coalition that our first priority in responding to treaty
changes aimed at stabilising the eurozone will be to protect the rights of
those countries in the EU but outside the eurozone over decisions affecting
them, and to prevent damage to the financial services industry that is so
important to this country’s economy.
Several hon. Membersrose—
Mr Hague: I will give way again in a
moment.
It is my
view and the Prime Minister’s view, and the position of the Conservative party,
that we will use future opportunities to bring further powers back to the
United Kingdom—to repatriate powers to the United Kingdom in those areas where
we believe European integration has gone too far.
The final
part of our approach to the EU is to make the case at every opportunity for it
to do effectively what we joined it for: to expand the opportunities for trade
both within Europe and beyond. Britain is the leading champion of expanding the
single market and concluding more free trade agreements with the rest of the
world. Last year’s agreement with South Korea is worth up to £500 million to
the British economy—a reminder to all of us, when we discuss these matters,
that we are talking about not just politics, but people’s jobs and businesses,
which we must never forget.
Ian Paisley: The Foreign Secretary has quite
rightly tried to outline the savings that the Government are making on European
costs, but he must know that by 2018 this nation will have spent £356 billion
on enforcing EU regulations. Does he not agree that this Parliament could spend
it better—on farming, on health care and on social policy—than the European Community?
Mr Hague: I have explained what we are
doing to keep the European budget down, and how I believe the European Union
has too much power. The hon. Gentleman must be a little careful, because
European Union spending has gone disproportionately to Northern Ireland, and he
ought to bear that in mind.
Andrew Selous (South West
Bedfordshire) (Con): On
trade, may I take the Foreign Secretary from the general to the specific? A
number of my constituents work at the Luton van factory, which very nearly
closed before it secured a major contract with Renault to keep it going for the
next decade. Does he share my concern that my constituents’ jobs would have
been at risk had there been any danger of Britain being outside the European
Union and the single market?
Mr Hague: It is true that if the European
Union’s external tariffs were applied to the car industry they would cost this
country £1.5 billion a year, so we do have to bear that in mind.
Several hon. Membersrose—
24 Oct 2011 : Column 55
Mr Hague: I will have to proceed again. We
are under this time constraint.
That is
the Government’s policy towards the EU, and that is why we cannot treat this
motion, as some have suggested, in a casual way. To do so would not do justice
either to the importance of the issues or to the significance of motions
presented in this House.
The Prime
Minister and I, as he said earlier, want many of the same things as some of the
motion’s supporters, but we clearly do not advocate leaving the European Union,
and I say as someone who has called for referendums on European matters—on
Amsterdam, Nice, Lisbon and the euro—and consumed vast acres of newsprint over
the years, criticising the euro and setting out a different vision of Europe’s
future, that the proposition for a referendum before the House today is the
wrong proposition at the wrong time. Building on what the Prime Minister said
earlier, I want in the 15 minutes remaining to me to give the House six
reasons—[Interruption]—some of them are very brief, do not worry—why
that is the case.
Several hon. Membersrose—
Mr Hague: But I will give way one more
time, to my hon. Friend the Member for Basildon and Billericay (Mr Baron).
Mr Baron: No one doubts my right hon.
Friend’s Euroscepticism, but, despite all the talk of reclaiming powers, week
in, week out competences and powers are being transferred to Brussels under the
very noses of the British people. That is why there is growing frustration in
the country, and that is why people want a say on whether they become part of
this ever-closer political union.
Mr Hague: I do not agree with my hon.
Friend that that is what is happening day by day, or week by week. In foreign
affairs, for example, we are absolutely clear, and all our embassies and posts
throughout the world are clear, that we will not permit any competence creep
following on from the Lisbon treaty.
My first
reason is the same as the first one given earlier by the Prime Minister. The
deficits of recent years, and the slowness of growth in all western economies,
make this a difficult and uncertain time for many individuals and firms. The
eurozone is clearly in crisis, and to pile on that uncertainty the further
uncertainty of a referendum on leaving the European Union, when half the foreign
direct investment into Britain comes from the rest of the European Union, and
half our exports go out to the rest of the European Union, would not be a
responsible action for Her Majesty’s Government to take. It would not help
anyone looking for a job. It would not help any business trying to expand. It
would mean that for a time, we, the leading advocates of removing barriers to
trade in Europe and the rest of the world, would lack the authority to do so.
It would mean that as we advocate closer trading links between the EU and the
countries of north Africa as they emerge from their revolutions, helping to
solidify tremendous potential advance in human freedom and prosperity, we would
stand back from that. That is not the right way to respond to this dramatic
year of uncertainty and change.
24 Oct 2011 : Column 56
Mr William Cash (Stone) (Con): In light of what my right hon.
Friend said in advocacy of the single market as it now operates, will he
explain why, between 2009 and 2010, our trade deficit with the 26 member states
jumped from minus £14 billion to minus £53 billion, and with the eurozone from
minus £4 billion to minus £38 billion in one year—last year alone? Why did that
happen, and what is his remedy?
Mr Hague: The remedy is to restore the health
of the British economy, to have a tax system, such as the Chancellor is
creating, that attracts businesses to this country, and to create export growth
from this country to the whole world, not just to the European Union. We cannot
do that if we are not taking part in the free trade agreements that Europe is
making with the rest of the world.
The
second and third reasons—
Kate Hoey (Vauxhall) (Lab): rose—
Mr Frank Field (Birkenhead) (Lab) rose—
Mr Hague: I will give two more reasons,
and then I will give way again. The second and third reasons why I do not
support the motion can be stated quickly. The second is that the election
manifesto on which we stood as Conservative Members was very clear about the
referendum legislation that we would introduce and that, in a coalition, we
have now passed into law. We were also clear, having been asked about this many
times during the election, that that did not include the option of an in-out
referendum.
The third
reason is that this Parliament has only recently, just weeks ago, passed with a
large majority in this House comprehensive legislation setting out in minute
detail the circumstances in which a referendum will be held.
Mr Field: Given that the Foreign Secretary
said that if there is further substantial transference of power to Europe, we
will have a referendum in this country, and as the Government are advocating
closer fiscal and monetary union in Europe, which will obviously lead to major
changes, why do they not adopt this motion and fix their own time scale for the
referendum that he is promising?
Mr Hague: The only treaty change agreed so
far—I am coming to this point—is the one that puts the European stability
mechanism on a legal basis, and for that we secured in return, as the Prime
Minister explained, that this country will no longer be forced to be part of
eurozone bail-outs. We will respond to every proposal by putting forward what
we need in return.
Any
treaty that transfers power to the European Union, and that is interpreted not
just by Ministers but by the courts of this country as doing so, will result in
a referendum for the people of the United Kingdom.
Several hon. Membersrose—
Mr Hague: Let me give my fourth reason
before giving way to a Liberal Democrat Member.
24 Oct 2011 : Column 57
As the
Prime Minister said, there is a serious danger that while holding a referendum
such as the one advocated —it is predicated on a Bill in the next session of
Parliament, which runs from 2012 to 2013 and means that a referendum would be
in 2013 or later—we would lose important opportunities to protect or to further
our national interest in the meantime. On all those areas where we need the
agreement of others—from the shape of the EU budget up to 2020, to agreement on
our requirements for any treaty change—it could be harder, not easier, to get
our way.
Simon Hughes (Bermondsey and Old
Southwark) (LD): Although
of course the Foreign Secretary and his party, and I and mine, come from
different positions on Europe, we both made commitments to referendums, but
both were conditional on there being a shift of power from this country to
Brussels. It therefore must be right that, at the moment, we concentrate on
helping our colleagues to sort out the European crisis, which is what
businesses want us to do, and on getting our economy to grow again, which is
what our constituents, in and out of work, want us to do. The referendum would
be an absolute and immediate distraction from that.
Mr Hague: That is one of the reasons I am
giving.
My fifth
reason is that the concept of holding a three-way referendum as set out in the
motion is innovative but seriously flawed. Leaving aside for a moment all the
uncertainty and difficulty which would occur in the run-up to a referendum,
which is my final point, if we are serious about this we have to think
carefully about what would actually happen in a three-way vote. It is highly
unlikely that any one of the three options would receive more than 50% of the
votes. If, for the sake of argument, 40% of people voted to stay in, 30% voted
to leave, and 30% voted to renegotiate, would that mean that we stayed in
without any renegotiation at all? Is this to be a first-past-the-post
referendum or a preferential voting referendum? If it is to be a preferential
voting referendum, we have just rejected that system—in a referendum. Perhaps
we would have to have a referendum on the voting system for the referendum
itself.
Andrew Percy (Brigg and Goole)
(Con)rose—
Mr Hague: I will give way again in a
moment.
If we
voted to leave the European Union, would that mean that, like Norway, we were
in the European Free Trade Association and in the European Economic Area but
still paying towards the EU budget, or, like Switzerland, not in the European
Economic Area? If we voted to renegotiate
“based on trade and
co-operation”,
as the
motion says, does that mean that we would be in the single market, or not;
still subject to its rules, or not? Does “co-operation” mean that we still work
together on a united position on Iran, Syria and other foreign policy
positions, or not? When we had renegotiated, would we, given the wide range of
possible outcomes, need another referendum on the outcome of the negotiation?
I point
these things out because there is a reason why a referendum is normally held on
a specific proposition with a yes or no answer, and I believe that any future
24 Oct 2011 : Column 58
referendum
must be held on that basis, not as a multiple choice among vaguely defined
propositions.
Several hon. Membersrose—
Mr Hague: I said that I would give way
again, and I give way to my hon. Friend the Member for Wycombe (Steve Baker).
Steve Baker (Wycombe) (Con): Surely my right hon. Friend must
know as well as I do that preferential systems are used in this House for
certain votes. Is it not equally the case that for some elections, first past
the post is appropriate, and for others, a preferential system is appropriate?
Why not have this three-way referendum on the basis of the single transferable
vote, as we do in this House for other elections?
Mr Hague: My hon. Friend’s argument is
that he would have a preferential voting system, but not everybody would, and I
am pointing out the difficulties with that.
Kate Hoeyrose—
Ms Gisela Stuart (Birmingham,
Edgbaston) (Lab) rose—
Mr Hague: I will give way another couple
of times in a moment, but I am trying to help the House to make progress.
My sixth
and final problem with the motion is that it does not do justice to the reality
that the European Union is not a matter of everything or nothing. We are in the
European Union, but not, thankfully, in the euro. We are not in the Schengen
border control area. We opt out of many justice and home affairs provisions. I
do not believe that most people in Britain want to say yes to everything in the
EU or no to everything in the EU; I believe that they want to know that no more
powers will be handed over to Brussels without their explicit consent, which is
what we have provided for in our Act.
Several hon. Membersrose—
Mr Hague: I will give way to the hon.
Member for Birmingham, Edgbaston (Ms Stuart) and then to my hon. Friend the
Member for Stratford-on-Avon (Nadhim Zahawi).
Ms Stuart: I am sure that we still have
sufficient time before the Foreign Secretary catches the plane to get him a DVD
of his 2008 speech on the Second Reading of the legislation on the Lisbon
treaty. He can then blush in the privacy of the aeroplane and probably answer
the question as to why he was for referendums then and is against them now, the
difference being that now he is in government.
Mr Hague: It will not be necessary to get
the DVD—it is on YouTube. I can assure the hon. Lady that my position is
exactly the same. I was in favour of a referendum on any treaty that hands over
the powers of the people of the United Kingdom, and I am in favour of that now.
24 Oct 2011 : Column 59
Mr Bernard Jenkin (Harwich and
North Essex) (Con): I
happened to bump into the chairman of the Electoral Commission today and he did
not rule out a three-option referendum as impractical. Did my right hon. Friend
consult the Electoral Commission on this matter before giving his opinion?
Will my
right hon. Friend also bear it in mind that the treaties are now so
comprehensive that at the conclusion of the summit he has just attended, the
European Union is setting up a new institution that does not even require the
British signature on a new treaty: the so-called euro summit of the 17. He and
his colleagues are having difficulty keeping track of things because that is
how the European Union now works. The veto was the foundation of our membership
and it is being eroded before our eyes.
Mr Hague: There is certainly no proposal
at the moment to set up such an EU institution. That is an intergovernmental
arrangement. Our first priority, as I and the Prime Minister have explained, is
to ensure that matters that should be decided at the level of 27 countries are
decided by the 27, not by the 17. I am grateful for my hon. Friend’s
information about the Electoral Commission—another unelected body that is
trying to decide what we might do. I am giving my opinion on the consequences
of a three-way referendum.
I will
give way one more time.
Nadhim Zahawi (Stratford-on-Avon)
(Con): Does the
Foreign Secretary agree that, whether in business or in politics, the best
strategies end up failing if they are badly timed?
Mr Hague: I absolutely agree with that. I
reinforce the point that this is the wrong proposition at the wrong time.
The
British people want to know that no more powers will be given away without
their consent; that at a time of budgetary restraint, EU institutions will be
faced with the financial reality, which is what our Prime Minister is doing;
that we will address the crisis in the eurozone with clarity about what should
be done, while minimising the exposure of the British taxpayer, which is what
the Prime Minister and the Chancellor are engaged in; that we will make a
passionate case for Europe to take measures that help growth and free up
businesses to trade and expand, which is what we are doing; that we will do
nothing to add to economic uncertainty at a difficult and dangerous time; and
that we will seek to repatriate powers as the opportunity arises, which is my
position and that of the Prime Minister. That is the right policy for the
United Kingdom.