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Lords Chamber

Volume 661: debated on Tuesday 11 May 2004

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House Of Lords

Tuesday, 11 May 2004.

The House met at half-past two of the clock: The LORD CHANCELLOR on the Woolsack.

Prayers—Read by the Lord Bishop of Peterborough.

Television Programmes: Subtitling

Whether they have studied Ofcom's proposals for the future of subtitling television programmes.

The Parliamentary Under-Secretary of State, Department for Culture, Media and Sport
(Lord McIntosh of Haringey)

My Lords, the Government are committed to extending access to broadcasting services for people who are deaf or hard of hearing. That is why we have the new statutory requirements in the Communications Act 2003. The Act requires Ofcom to draw up a code on subtitling provision. The Government are fully aware of Ofcom's proposals but, provided it adheres to the provisions of the Act, the detail of the code is a matter for Ofcom.

My Lords, I thank my noble friend for that Answer. Is he aware that profoundly deaf people are entirely reliant on subtitles for following television? But, although the recent Communications Act provided for what he and my noble friend Lady Blackstone called, "a dramatic increase", in subtitling, that aim is being frustrated by Ofcom's proposals. Ofcom has now withdrawn the preposterous proposal to end the subtitling of parliamentary programmes and the equally preposterous proposal to end the subtitling of live television programmes. It has withdrawn its silly ideas. However, Ofcom is still insisting that it should end the annual increase in subtitling, which we have now and which is very valuable; it is also insisting that it will license only 50 out of the 200 television channels that we have. That means that 150 channels have no responsibility for subtitling. That is bizarre and the intentions of Parliament are being absolutely disregarded. What can the Minister do to help?

My Lords, I share the pleasure of the noble Lord, Lord Ashley, that Ofcom has withdrawn its proposal to exempt live programming and parliamentary programming from the subtitling obligation. It is in no small degree due to his efforts and those of the advisory committee that that has happened.

Where he and I still have to disagree is about whether there will be a dramatic increase in subtitling. The Mom code says that there has to be an increase to 10 per cent at the end of the first year—that is the end of December this year—and to 60 per cent four years later. I call that a dramatic increase. The issue then is whether there should be annual targets. My view is that broadcasters in the normal course of business will wish to advance towards the 60 per cent target at a reasonable pace, but if they do not I would expect Ofcom to pursue them and to ensure that they do.

As regards the channels that are to be exempt, that is done on grounds of cost and is justified by the Act, but Ofcom is undertaking a study of cheaper methods of subtitling, which should increase the number of channels covered by the subtitling obligation.

My Lords, should not Mom be requiring the satellite and cable companies to be making the step-by-step increase in the proportion of programmes that are subtitled? Was that not in the spirit of what we agreed when discussions took place on this issue during the course of the Communications Bill's progress through this House? Does the Minister also agree that the hourly cost of subtitling is very low—between £250 and £400 an hour? Taking that into account, surely Ofcom should be issuing a requirement that subtitling should increase every year.

My Lords, the noble Baroness, Lady Blackstone, has rightly drawn attention to the fact that digital, cable and satellite channels are now included for the first time in the subtitling obligation. I have already replied to the question of whether there should be annual targets. Ofcom argues that, as light regulators, it should not be setting annual targets for all channels, but I have already indicated that I expect broadcasters to move towards their 60 per cent five-year target at a steady rate—and if they do not, I would expect Ofcom to do something about it.

My Lords, is it not the case that it is perfectly technically feasible to add subtitles on an optional basis—that they need not be seen by people who do not need to see them? Why is it then so difficult for the television companies to continue as Mom would prefer?

My Lords, I am not aware of the point made by the noble Lord, Lord Trefgarne, about optional subtitles. I have no reason to doubt his comments, but I do not think that that affects the thrust of the Question put by the noble Lord, Lord Ashley.

My Lords, does the Minister not agree that, sooner rather than later, television programmes should be interpreted in all accessible formats?

My Lords, I assume that what the noble Lord, Lord Rix, is saying is that in addition to subtitling there should be audio description. If so—yes, I do think that the targets for audio description are inadequate. There may well be technical ways forward to improve on those targets and I am negotiating with broadcasters to that effect.

My Lords, does the Minister accept that, when he said that these,

"changes should lead to a dramatic increase in the provision of services to help people with sensory impairments to enjoy television", [Official Report, 1/7/03; col. 8844.]
that we did not assume that it would mean a freeze for five years at 10 per cent; we expected it to go on increasing?

No, my Lords, I do not think that Ofcom expects a freeze for five years at 10 per cent. It says that there will be a target of 10 per cent at the end of year one and a target of 60 per cent at the end of year five. As I have made clear, I expect that target to be approached steadily. If it is not approached steadily and there is no improvement in the mean time, I expect Ofcom to do something about it.

My Lords, with regard to music channels, for example, is not the challenge to find the right balance between the need to subtitle and the need to protect copyright in a way that does not make the provision of music totally unworkable in practice for the industry?

My Lords, I am sure that that is one of the considerations that Ofcom will have to take into account, but I am not sure that it has been addressed in the Ofcom code at present. I shall have to look into the matter and write to the noble Baroness, Lady Buscombe, about it.

My Lords, is my noble friend aware that the Ofcom Advisory Committee on Old and Disabled Persons met for the first time last Thursday? I declare an interest as a member of that committee. The final decision on the Ofcom code is for the main board, but the chairman of Ofcom, the noble Lord, Lord Currie of Marylebone, gave us an undertaking at our first meeting that the views of the advisory committee would be taken into account by the main board.

I hope that my noble friend agrees that it is very important that the Ofcom code that finally appears is fully in line with the very firm assurances given by Ministers in both Houses during the passage of the Communications Bill. We have already heard a quote from the Minister. The noble Baroness, Lady Blackstone, the then Minister of State, said:
"Ofcom will have the ability to set interim targets on the way to meeting 10-year targets, as the ITC currently does, so provision of subtitling, signing and audio-description will grow year by year".—[Official Report, 3/6/03; col. 1259.]

My Lords, I have already been quoted three times in the past few minutes. As the Bellman said in The Hunting of the Snark,

"What I tell you three times is true".
I cannot go back on what I said on 1 July last year. What I meant by a dramatic increase is I believe, achieved by the Ofcom code. Continuing progress towards 60 per cent subtitling in five years' time, which is what the Act requires—all credit to those who insisted that it should—is dramatic progress. I congratulate the advisory committee on its work and look forward to the full board of Ofcom accepting the representations that the advisory committee has made to it.

School Term Dates

2.45 p.m.

Whether local education authorities will be required to consult parents before the introduction of a six-term year.

The Parliamentary Under-Secretary of State, Department for Education and Skills
(Baroness Ashton of Upholland)

My Lords, decisions on school term dates are made by local education authorities or school governing bodies, depending on the type of school. Procedures for consultation are not set out in legislation but we would expect there to be wide consultation with parents and the school workforce, and between the local education authority and schools.

My Lords, I am grateful to my noble friend for that Answer. Does she agree that the change to a six-term year is fundamental for many parents? Will she ensure that, in encouraging LEAs to consult parents, they will consider having a ballot of all parents in their LEA area?

My Lords, it is an important change, but I am not sure whether I would go so far as to agree with my noble friend that it is fundamental. We would not want to be prescriptive. It is for local authorities to determine how they wish to consult. They might wish to do that, but we would not prescribe it.

My Lords, does this mean that one local education authority could introduce a six-term year in an area while in others a four-term year remained? Could that not create great confusion for parents, businesses or people planning to have jobs in one place and children at school in another?

My Lords, it could mean that there would be differences between local authorities. Twelve LEAs have moved to a modified version, if I might describe it as such, of the six-term year for 2004–05. The biggest change comes around the Easter break. In all cases the six-week summer holiday is retained, which is an issue that parents have raised.

My Lords, does my noble friend realise how important consultation is, especially in places such as Lancashire, where the wakes weeks happen throughout the county at different times? It is important that organisations such as trade unions are consulted also, because it makes a great difference to work in industry.

My Lords, again, that rests with local authorities. It is important that local authorities consult as appropriate. I am sure that local authorities in Lancashire would be mindful of the wakes weeks.

My Lords, does my noble friend agree that any such consultation should extend to the truancy problem of some parents taking children out of school for family holidays during term time? Will those consultations also extend to the tourism industry, which, I believe, would welcome a six-term year?

My Lords, I agree with my noble friend. The Local Government Association's independent commission on the school year included representation from the tourism industry.

My Lords, do the Government have any mechanism for consulting parents? If so, what is it?

My Lords, we do not have a formal mechanism for consulting each parent. We keep in touch with parents through local authorities, through our work with schools, the National Confederation of Parent Teacher Associations, the National Association of Governors and Managers and the National Governors' Council.

My Lords, the Minister said that there had been a modified change in one or two areas. Can she elaborate on that?

Indeed, my Lords. In 1999 the Local Government Association established an independent commission, which looked at a standardised six-term year, roughly comprising two seven-week terms in autumn and four terms of six weeks in spring and summer. The original proposals suggested that the school holidays would begin in early July and the autumn term in mid-August. The modification was to keep the summer holidays more or less as they are.

My Lords, why is there some variation in the pattern between local authorities? What advantages would there be of changing over to the new six-term year?

My Lords, there is no variation between the 12 LEAs that have gone forward with their proposals; they are all going for the modified version that I described, rather than the LGA's original proposal. The benefits are reckoned to come in the autumn term. Instead of having a long autumn term, schools would be able to split it up. There could also be a fixed spring holiday.

My Lords, I realise that the Government are going further and further away from Europe, but why should Britain accept a scheme that no other country in Europe has? The long summer term is a characteristic of all European education. Global warming means that August would not be the ideal time. Have the Government given thought to what their neighbours do?

My Lords, the Government always look to their neighbours, but, in this context, responsibility for determining school terms lies with local authorities, who take into account a range of issues, particularly those that affect parents, schools and the school workforce.

My Lords, I welcome the helpful consultation with parents that the Minister's department undertook through the National Family and Parenting Institute, in preparation for the Children Bill. Will the Minister consider whether such consultation on this issue, commissioned by her department through the NFPI, would be useful to local authorities? Will she consider using that method, which worked so well with regard to the Children Bill, more widely, so that we can better understand the needs and wishes of parents?

My Lords. as the noble Earl knows, it is important to the department to have all the opportunities that we can to consult parents, through the Green Paper and the consultations on the Children Bill. On the specific question, it is for local authorities to determine how best to consult parents. Many have an opportunity to do so through the schools, and I would leave it in their hands.

My Lords, does the consultation process take account of the needs of special schools? For children with special educational needs, continuity is all important.

My Lords, the noble Baroness makes an important point. The process is for all schools in an area. As the noble Baroness indicated, there are issues for children with special needs, not least in determining what additional support can be provided for those children beyond the school term.

Common Fisheries Policy

2.52 p.m.

What consideration they are giving to taking the United Kingdom out of the common fisheries policy.

The Parliamentary Under-Secretary of State, Department for Environment, Food and Rural Affairs
(Lord Whitty)

My Lords, a change to the Treaty of Rome, which would require unanimity, would be needed for the UK to withdraw from the common fisheries policy without withdrawing from the EU. The challenges that the fishing industry faces will be resolved not by further discussion of leaving the common fisheries policy but by practical reform. Most of the stocks that we fish migrate in substantial numbers in and out of our waters. They can be effectively conserved only through co-operation with our partners in Europe.

My Lords, I thank the Minister for that not altogether satisfactory reply. Do the Government realise that, if they want to secure the Scottish vote in any referendum on the European constitution, they must either take our fisheries out of the common fisheries policy or, at the least, renegotiate the terms of membership? Are the Government aware that, as the Norwegians are not in the common fisheries policy, their waters have not been overfished by the Spaniards and others and still have plenty of fish in them?

My Lords, there has been a depletion of stocks in the North Sea of some species and not of others. The comparison with Norway is not entirely valid. As for any referendum on the European constitution, the issue will not determine the vote of Scottish electors: they are far too sensible for that.

My Lords, I am strongly in favour of Ministers being polite, courteous and as brief as possible in replying to Members. On this occasion, the Minister missed a marvellous opportunity. Should not the Minister have replied, "Non" and sat down?

My Lords, it occurred to me to do that. I am sure that, had my noble friend Lord Barnett been standing here. we would have heard that kind of answer, given in the politest possible way. In reality, the answer is "No". We are not considering withdrawing from the common fisheries policy, and nor will we.

My Lords, the Minister says that fish in European Union waters migrate and that therefore this dreadful policy is required. Will he admit that, when we joined the common fisheries policy, the United Kingdom owned more than 70 per cent of the fish that spent all their life in British waters? Will he also give your Lordships the vaguest estimate—to the nearest £1 billion a year, let us say—of the damage that the policy has done to the British economy?

My Lords, it is erroneous to say that we "owned" the fish in 1972. In any case, not many of them are around any more. Had we continued to fish at that rate, whether or not we were in the common fisheries policy, there would have been a conservation problem. There is a conservation problem now that the common fisheries policy—belatedly and not always in the most sensible way—is attempting to address. It is important that we address the problem and do so with the other nations that have access to those waters.

My Lords, will the Minister get his department to assess the impact of the decision of the Council of Ministers last winter to allow EU fishing boats, including Spanish vessels, into the Irish Sea, where hitherto they had not been? If the facts of what is going on are established, will he make every endeavour to reverse that policy?

My Lords, the decision in December was negotiated in detail for different waters. On balance, it reduces the number of days that Spanish and other European vessels, including British vessels, can fish in the Irish Sea, the North Sea and other European waters. It is a means towards conserving the stocks of species that are under threat.

My Lords, the Minister said that we could get change only through co-operation. I trust that the Minister will, at least, acknowledge that our fishing stocks are in a very poor state. Co-operation has not been the panacea that it should have been. The Select Committee chaired by the noble Earl, Lord Selborne, has issued four reports and knows exactly what the problem is, but there is no action. All of that is happening alongside the closure of our Scottish fishing fleets, while other European countries are allowed to reinvest in their vessels. Is it not time that the Government did something about it?

My Lords, we are doing something about it. Last winter, we got the kind of deal that was appropriate. I said earlier that it was belated and that those in the common fisheries policy had not always faced up to the real difficulties of conservation and ensured the fair sharing out of the burden. However, we believe that we are on better lines now. For species such as cod, in particular, that face serious conservation problems, we have a basis for restricting fishing and allowing for some restoration of the stocks.

My Lords, there is plenty of time. Shall we hear from the noble Lord, Lord Campbell of Croy?

My Lords, is there not a conflict of policies, in that the United Kingdom has a conservation policy in our coastal waters, whereas the EEC appears to condone a free-for-all, with fishing allowed, in some cases, up to the beaches?

My Lords, EU policy in EU waters is now focused on conservation, as is the British policy on inshore fishing. As I indicated, it has taken some time to get the common fisheries policy to that point, and all countries have overfished those waters. We now face quite a serious situation, but the December agreement will, I think, begin to tackle the problem.

My Lords, in reply to the noble Lord, Lord Pearson of Rannoch, the Minister said that the fish had disappeared from British waters. Is that not because we allowed the predatory Spanish fleet to come in and take them all? Will that problem not be exacerbated, now that the European Union has decided that the catch should be shared between the new entrant nations? There are 10 such nations, and many of them are absolutely landlocked. As long as we keep on sharing our stocks, it is inevitable that they will be further depleted, and our fishing fleets with them.

My Lords, as far as enlargement is concerned, there are only two countries which have just acceded to the European Union that have access to the North Sea, western waters and the Baltic. They are Estonia and Poland. Between them they have a 2,000 tonnes quota compared to a total of more than 500,000 tonnes. They are unlikely to make a significant difference, particularly in our waters.

Clearly, if we do not have a common approach to this there will be a free-for-all and the conservation will not be achieved. Neither futile attempts to persuade us to leave the common fisheries policy nor wrongful assertions that the European constitution alters this situation will help in the discussion of what is a very real and serious problem for our fishing industry and for the marine environment.

My Lords, instead of describing the Spaniards as predators, as the noble Lord, Lord Stoddart, did, does the Minister agree that, in fact, the British industry has to a substantial degree damaged itself by the sale of fishing boats, and with them the consequential quota, many of them boats that were otherwise fishing in Scottish waters?

My Lords, yes. I have brought that to the attention of the House before. The sale of some otherwise British entitlements to the Spanish and others has done some serious damage to the interests of the British fishing industry.

My Lords, I am afraid that we are over time. We need to move on to the next Question.

Rural Bus Services

3.2 p.m.

What action they propose to take to assist rural bus services.

My Lords, the Government have an excellent record of support for rural bus services. Over the past three years, £240 million has been invested in rural public transport. That programme continues this year with £51 million allocated to local authorities in the rural bus subsidy grant and an estimated expenditure of £20 million under the Rural Bus Challenge. We are encouraging the expansion of demand-responsive and community transport services, which have a significant role to play in rural communities.

My Lords, I thank the Minister for that reply, but is he aware that large and small bus operators alike are now withdrawing rural bus services at the rate of 30 or 40 per week? Local authorities are simply unable to plug the gap. For example, this year, Kent is spending £6.5 million to subsidise rural buses. Is the noble Lord aware of the comments made by the National Federation of Bus Users which has said that unless rural bus services are taken seriously now, they will simply disappear?

My Lords, of course, we take seriously all representations from such a source. But I think that the noble Baroness will recognise that we have made a significant commitment to rural bus services. We intend to sustain that commitment. The Rural Bus Challenge has thrown up a number of very interesting initiatives, not least in the noble Baroness's county of Suffolk, on which we can build. Of course, local authorities are taking greater responsibility through local transport partnerships for planning local services in a more intelligent and helpful way.

It is on that basis that we should look forward to an improvement in the situation and not follow the doomsayers whom the noble Baroness has rather enthusiastically endorsed today.

My Lords, is it not time that the Government looked again at franchising rural bus services in the way that they do in London? As the noble Baroness, Lady Scott, said in her supplementary question, it is very easy for bus operators to withdraw services that they are providing and then expect the local authority to pay them to continue the set-Nice that they were providing for nothing. A franchise system would surely do away with that.

My Lords, a franchise system would certainly change that position. Against a background of very significant improvements in recent years, perhaps I may just mention to the House that 48 per cent of rural households now have easy access—within a 10-minute walk—to an hourly or better bus service, compared to only 37 per cent in 2000. In rural parishes. 488 per cent of households have access to community transport services, compared to only 21 per cent in 1997. Those are real improvements for our rural communities. I think that we should build on such improvements.

My Lords, does the Minister agree that our rural lanes are not designed for large single-decker buses, which, in my experience, often appear to have one, two or three passengers? Is there anything that the Minister can do to encourage rural bus operators to use smaller vehicles?

My Lords, certain aspects of the Rural Bus Challenge have thrown up exactly that kind of issue. Smaller and more economic buses that can use the rural roads more effectively, which also have a more economic payload with lower fuel costs because they are smaller, are improving the service. That is happening in a number of areas. We expect to see such initiatives built on.

My Lords, is the Minister aware that since 1997 the cost of running a car has fallen by 4.2 per cent while the cost of using a bus—that is, all buses—has risen by 8.2 per cent. That is a 12 per cent difference. Bearing in mind that, in Cornwall, First Group. and, in Norfolk, the local bus company, are withdrawing bus services on a large scale, is it not time that the Government really woke up to the crisis that is afflicting our rural bus services? These are not minor bus services but the major bus services on which people depend for work and major leisure pursuits.

My Lords, we have to look at that question of the shift in comparative costs. In his usual fair manner. the noble Lord would recognise why the costs of certain kinds of transport as opposed to buses look more favourable. That is simply because we seek to pay our bus drivers and, where there are conductors, bus conductors reasonable wages. Of course, the car driver completely discounts the strain and costs of driving a car. So there are certain aspects with regard to those costs that are irremediable as far as the contrast between private and public provision is concerned.

We recognise that for a very large number of people who are dependent on rural bus services, improvement is absolutely critical. That is why it will be necessary to ensure that the improvements that we have seen in recent years are sustained.

My Lords, the noble Lord has indicated progress in that bus services are within closer reach of a greater number of people. Can he give any indication of whether greater use has been made of buses?

My Lords, the issue with regard to improved usage of buses is patchy across the country. One place of which we are all aware where the usage has increased very significantly is, of course, London. That has not been matched in any rural area. But there are a number of counties where initiatives have been taken that others can emulate, which show that greater usage of buses can develop.

I think that the House will recognise that rising prosperity and more ready access to cars—simply reflected in the number of cars on our roads with. I might add, their increasing congestion—mean that people who buy cars do not become dependent on buses. That is a historical trend that we have begun. to a certain extent, to level out and to moderate. But none of us would pretend that that is an easy trend to reverse.

My Lords, one group of users who, because of their vulnerability, find buses difficult are disabled people. When I am travelling around London, there is good access to buses and the Tube. In my rural home in Breckland, I have never seen a bus with a lowering platform. Are the Government looking at the transport needs of disabled people in rural areas? In addition to community transport, they have a right to use ordinary transport.

My Lords, the noble Baroness is right that the issue of disabled access and improvement to buses has been more conspicuous in our large cities and with our large vehicles. Norfolk, for instance, has experimented in one area with quite a small bus that has effective disabled access. So the issue is not an impossible one to overcome but it requires some resolution.

International Cricket

3.10 p.m.

Whether they will seek direct talks with the International Cricket Council to discuss adding moral criteria to its rules on the legitimate grounds for tour cancellation.

My Lords, the Government have no plans to talk to the International Cricket Council about adding moral criteria to its regulation on the cancellation of cricket tours. That is a matter between the ICC and its members, including the England and Wales Cricket Board.

My Lords, does the Minister agree that there is a certain whiff of hypocrisy about seeking to take all the kudos of condemning a tour while leaving the cricket authorities with the difficult decisions and the financial consequences?

My Lords, there are three answers to that question. First, no one has asked us to speak to the International Cricket Council. Last week. Jack Straw and Tessa Jowell met the England and Wales Cricket Board and it did not ask us to intervene. Secondly, even if we did intervene, there is no indication that the International Cricket Council would pay any attention to us. Thirdly, we do not want to intervene because we do not want to have state-run cricket in this country.

My Lords, does my noble friend agree that the English and Wales Cricket Board is damned if it does and damned if it does not? The players do not want to tour; the ECB does not want to tour; but if it does not, it faces massive fines and the possibility of being removed from international cricket by the ICC. Why are the Government so reluctant to talk to the ICC? Is it not time that this tour was called off? We do not want to give succour to such a repugnant dictator as Mugabe.

My Lords, the Government have always made it clear that they do not approve of the Mugabe regime. I have heard my noble friend Lady Symons say that in detail from this Dispatch Box on many occasions in recent months. However, it does not follow that we have been asked to or that we should intervene in the regulation of cricket in this country. There is no implication of approval of the Mugabe regime in our actions.

My Lords, the Minister is employing a little casuistry. The point made by the noble Lord is absolutely right. The Government have gone on record as deploring a tour but leaving the cricket authorities with the difficult decisions, and they will get themselves into a political morass by adopting that ambivalent posture. Why will the Government not take responsibility for giving a specific instruction that would release the cricket authorities from having to tour? If they will not give such a specific instruction, they should stop interfering in cricket by implying that there should not be a tour on the moral grounds that they hold. The Government are being hypocritical in this matter and the price will be paid by English cricket.

My Lord, the more flowery the noble Lord's language becomes, the less I am convinced that he thinks he is sure of his ground. The position is entirely clear. It is that we would wish for a postponement of the cricket tour, that we deplore the Mugabe regime, that we would wish for the replacement of that regime to be brought forward, but that we have no status in deciding which cricket team should tour Zimbabwe. That is a perfectly logical and consistent position and we have adhered to it throughout.

My Lords, has the Minister any idea whose morals the noble Lord, Lord McNally, has in mind? Arc they the noble Lord's own morals, the Minister's morals or perhaps my morals, all of which are no doubt slightly different?

My Lords, I strongly resent the suggestion that anyone in this House has anything other than impeccable morals.

My Lords, is it not a question of moral courage? As a vice-president of one of our county cricket teams, I speak with some interest in this matter. I have had an opportunity to talk to England players who are apprehensive that if they refuse on moral grounds to go on tour, as they would wish, they will not be selected for future international matches. Are the Government aware that if they do not give the moral lead for which the country and the whole cricketing world are waiting, they might not be selected for the next tour'?

My Lords, I am sorry that the noble Lord, Lord Imbert, should think that. In refusing to involve themselves in the affairs of cricket and refusing in effect to have our cricket run by the state, as I believe it is in Zimbabwe, the position of Her Majesty's Government is logical and consistent. If that results in threats from any side of the House as to re-election, so he it, but our position is not based on that consideration.

My Lord, does my noble friend perhaps recall that in 1970 a Labour Home Secretary, Lord Callaghan, told the MCC that the South Africans should not tour, and that he took that view not on moral grounds but on grounds of disorder and danger to life and property, including the life and property of the cricketers concerned? Is that a possible way forward?

My Lords, we are a long way from 1970. The possibility of disorder is clearly a matter that the Home Secretary would take into account. I am not aware that it has at any stage been raised by the England and Wales Cricket Board or by anyone else.

Smoking In Public Places (Wales) Billhl

3.17 p.m.

Read a third time, and passed, and sent to the Commons.

Asylum And Immigration (Treatment Ofclaimants, Etc) Bill

My Lords, on behalf of my noble friend Lady Scotland of Asthal, I beg to move the Motion standing in her name on the Order Paper.

Moved, That the amendments for the Report stage be marshalled and considered in the following order:
  • Clauses 1 to 13,
  • Clauses 15 to 19,
  • Schedule 3,
  • Clauses 20 to 32,
  • Clauses 34 to 36,
  • Clause 14,
  • Schedules 1 and 2,
  • Clause 33,
  • Schedule 4.—(Lord Grocott.)
  • On Question. Motion agreed to.

    Planning And Compulsory Purchase Bill

    3.18 p.m.

    rose to move, That it is desirable to vary the normal practice of the House when considering Commons reasons and amendments, whereby no further consideration of a Bill can take place in the event that—

  • (i) the Lords insists on an amendment;
  • (ii) the Commons insists on its disagreement to that amendment; and
  • (iii) neither House has offered alternative proposals;
  • to allow the House to consider the Commons reason and amendment to the Bill.

    The noble Baroness said: My Lords, this Motion is unusual, and the House will expect a word of explanation. When the Planning and Compulsory Purchase Bill came back to the Lords on 29 April, it appeared that unintentionally a double insistence had been reached on Lords Amendment No. 3. The situation appeared to correspond with the description of double insistence in our own Companion to the Standing Orders and Erskine May Parliamentary Practice. At paragraph 6.160, the Companion states:
    "if one House insists on an amendment to which the other has disagreed, and the other insists on its disagreement, and neither has offered alternatives, the bill is lost".
    Erskine May says much the same thing, but goes on to state:
    "It must be remembered, however, that there is no binding rule of order which governs these proceedings in either House, and, if there is a desire to save a bill, some variation in the proceedings may be devised in order to effect this object".
    What I am now about to say is somewhat technical, but I hope not too complicated. In the Commons, Amendments Nos. 1 and 3 were treated as forming a package and Amendment No. 1C was regarded as a new proposal that would keep the exchanges on both amendments going. Ministers took advice in the Commons and acted on it. However, when the Bill again reached this House, the authorities in this House were unable to accept the Commons' interpretation, which presumes a knowledge in the Lords of what happens in the Commons. The Lords can go only by Commons amendments and reasons as set out in their messages. The Commons gave a freestanding reason for insisting on their agreement to Lords Amendment No. 3 and did not indicate that the amendment in lieu of Amendment No. 1 represented an alternative proposal to Amendment No. 3.

    Turning from the Commons to this House, Amendments Nos. 1 and 3 were not grouped in the last Lords debate on 26 April. Furthermore, Amendment No. 1 was moved by a Liberal Democrat Peer, while the unrelated Amendment No. 3 was moved by a Conservative. In the circumstances, the Clerk of the Parliaments took the view that a double insistence had been reached as described by the Companion and Erskine May. I accept that advice.

    However, in the passage I read out just now, Erskine May makes it clear that no binding rule of order governs these proceedings, stating:
    "If there is a desire to save a Bill, some variation in the proceedings may be devised in order to effect this object".
    It is certain that on 29 April the Commons had no intention of creating a situation in which the Bill could proceed no further. Likewise, in this House the usual channels have accepted that this was not the intention and have agreed that this Motion and the new amendment should be put to the House: hence this Motion. It invites the House to confirm that the Bill should not be completely blocked unintentionally and that we are prepared to consider the Commons amendments and reasons.

    It is obviously undesirable that this situation should have arisen at all. I am sure that we all wish to ensure that it does not do so again. We accept that the consideration of amendments and reasons—which we know as "ping pong"—can result in the loss of a Bill. This may be deliberate, but it may also be inadvertent. If it resulted from carelessness on the part of Ministers or a refusal to take advice, then Ministers might simply have to live with the consequences. But that is not the case here. Ministers acted with due diligence and on the advice of the House authorities.

    I have invited the Clerks of both Houses and parliamentary counsel to consider jointly the lessons learnt from this episode and how best to avoid such a situation in the future. In particular, they will look at the practice of considering amendments in the other House in groups or packages and the procedural consequences which can follow. I am glad to say that they have readily agreed to this course of action. I will ensure that the House knows the outcome as soon as possible. In the mean time, I commend the Motion to the House.

    Moved, That it is desirable to vary the normal practice of the House when considering Commons reasons and amendments, whereby no further consideration of a Bill can take place in the event that —
  • (i) the Lords insists on an amendment;
  • (ii) the Commons insists on its disagreement to that amendment; and
  • (iii) neither House has offered alternative proposals;
  • to allow the House to consider the Commons reason and amendment to the Bill.—(Baroness Amos.)

    My Lords, I am grateful to the noble Baroness the Leader of the House. She has reported very fairly and properly to the House on an extraordinary and very serious situation that arose last week. This was no mere technicality. Without full cooperation from the usual channels, it could have ended in a humiliating fiasco for the Government and, very possibly, a Planning Bill on which Parliament has been working for 18 months would have been lost. Indeed, it will still be lost if the House does not agree to the Motion proposed by the noble Baroness.

    As the House knows, Members on this side are not in favour of the Planning Bill: we believe that it is a thoroughly bad Bill. I would have been glad to see it lost, but in such unusual circumstances I felt that we owed a duty to the House to preserve the spirit as well as the letter of parliamentary procedure.

    The House will. I hope, accept what the noble Baroness has said—that it was clearly not the intention of the Government or the House of Commons to lose their own Bill. I do not think, in those circumstances, it is for this House to exploit the kind of procedural mistake that would destroy the whole of a programme Bill.

    I should also say that progress was helped by the notable efforts of the noble Lord, Lord Rooker, to whom I pay tribute, who along with my noble friend Lord Hanningfield persuaded the Government to accept that an amendment made by your Lordships which had been swept aside in another place should, in effect, be restored. However, I must make it clear that this is an exceptional agreement in the case of this one amendment to this one Bill. Although the noble Baroness has rightly reminded us that Erskine May states that either House can vary proceedings in this way. I know of no direct precedent for it. And, for the record, I must say firmly that it must form absolutely no precedent for the future.

    I share the view of the noble Baroness, who speaks for the whole House, in saying that this situation should never arise again. If it were to do so, then I give no undertaking that we on this side would be so forbearing.

    Perhaps it is worth reiterating what has happened. An amendment made by this House was linked in the other place to another unrelated amendment. It was then thought, mistakenly, that it was enough to propose an amendment in lieu to just one of the two amendments to justify outright and repeated rejection of the other one. Had that doctrine prevailed, then in future any number of unrelated amendments could be linked in another place and an amendment in lieu proposed to just one of them. All the other unrelated amendments made by this House to that same Bill could be rejected indefinitely by another place, which would never then be required to offer any compromise to your Lordships' House. That, I am sure, would be quite unacceptable to Peers on all sides of the House. After all, only in 1999, the then Leader of the House, the noble Baroness, Lady Jay of Paddington, promised that amendments made by the reformed House would carry more authority.

    I should like to pay the warmest tribute to the Clerk of the Parliaments who upheld the authority and rights of this House. I also welcome the announcement by the noble Baroness of a new study by the authorities of both Houses and by parliamentary counsel into what has happened and how to avoid it in the future. They must realise that this House deprecates what has happened and fully accepts and upholds the advice given by the Clerk of the Parliaments throughout, as the noble Baroness has herself made clear. We look forward to the noble Baroness reporting hack to the House, as she has undertaken to do.

    I hope also that she will urge her colleagues in another place to give much more appropriate and serious consideration to all Lords amendments. If that too were to happen, then out of this even more good might come. I thank the noble Baroness for her part in arriving at a constructive solution that protects this House. I support the Motion and I hope that it will now be approved by the House.

    My Lords, Members on these Benches agree with the noble Baroness the Lord President that this is an extraordinary situation. But we also admire the ingenuity and flexibility that has been shown in this House to ensure that a procedural solution can be devised, as is suggested in Erskine May, to ensure that the will of Parliament can he determined and that procedure should not restrain what we wish to achieve.

    Like the noble Lord, Lord Strathclyde, I am glad that in her statement, the noble Baroness referred to the fact that the authorities of the two Houses are to work together to ensure that this sort of incident does not recur and that comity between the Houses may be maintained in appropriate ways.

    This is one of the relatively rare parliamentary occasions when one can almost certainly note in advance that our proceedings today are likely to end up as a footnote at least in the next edition of Erskine May. We should be aware of that as we vote in support of the Motion put forward by the Lord President.

    My Lords, I thank the noble Lords, Lord Strathclyde and Lord Roper, for their comments. The noble Lord, Lord Strathclyde. was characteristically robust. I say again to the noble Lord that, as I made clear in my statement, Ministers acted with due diligence and on the advice of the House authorities. The noble Lord knows that all governments take advice from the House authorities. However, I should like to end by saying that I am grateful for the work of the usual channels and the House authorities which has enabled us to reach this point.

    My Lords, the noble Baroness made it clear in her original speech that this should never happen again. My noble friend on the Front Bench explained that it is quite important that it should not do so. If this were to set a precedent, the other place would have a means of avoiding treatment of almost all our amendments. I hope, therefore, that she will concur with him that this will not be, in her view, any kind of precedent.

    My Lords, that is precisely why I have asked the House authorities to look at the matter. I shall report back to the House.

    On Question, Motion agreed to.

    My Lords, I beg to move that the Commons amendment and reason be now considered.

    Moved, That the Commons amendment and reason be now considered.—(Lord Rooker.)

    On Question, Motion agreed to.

    Commons Reason For Insisting On Disagreeing With A Certain Lords Amendment And A Commons Amendment In Lieu Of A Certain Other Lords Amendment

    [The page and line refer to HL Bill 10 as first printed for the Lords.]

    Lords Amendment

    1. Before Clause 1, insert the following new Clause—

    "Application of Part 1

    Part 1 shall apply only if an elected assembly for the region has been established."

    The Commons disagree to this amendment for the following reason—

    1A Because it is not appropriate to restrict the application of a regional spatial strategy only to regions which have elected assemblies.

    The Lords insist on their Amendment No. 1 to which the Commons have disagreed. for the following reason—

    1B Because responsibility for drawing up regional spatial strategies should lie with the elected representatives of the communities affected.

    The Commons insist on their disagreement to Lords Amendment No. 1 but propose the following amendment to the Bill in lieu thereof—

    1C Page 2, line 7, at end insert—

    '(2A) The Secretary of State must not give a direction under subsection (1) in relation to a body unless not less than 60% of the persons who are members of the body fall within subsection (2B).
    (2B) A person falls within this subsection if he is a member of any of the following councils or authorities and any part of the area of the council or authority (as the case may be) falls within the region to which the direction (if given) will relate—
  • (a) a district council;
  • (b) a county council;
  • (c) a metropolitan district council;
  • (d) a National Park authority;
  • (e) the Broads authority.'
  • My Lords, I beg to move that the House do not insist on its Amendment No. 1, in respect of which the Commons have insisted on their disagreement, but do agree with the Commons in their Amendment No. 1C in lieu thereof.

    As the House knows, or is about to find out, Amendment No. 1 would end any system of regional planning where there was not an elected regional assembly. I have set out the Government's stall on the importance of regional planning several times, but let me do so again briefly.

    We need a system for strategic planning that is based around areas that are interdependent on the ground, not one constrained by administrative boundaries. Many strategic planning issues cut across county boundaries and are best dealt with at regional or sub-regional level. I know that here and in the other place concerns have been expressed about accountability, which I understand and appreciate. We have reflected on a practical way to respond to these concerns. I hope that the democratic guarantee offered by Amendment No. 1C that has arrived from the other place—the elected House—will commend itself to this House.

    The regional planning process needs to be driven forward by bodies able to represent the region and take a strategic view. Regional chambers are best placed to fulfil that role. Chambers are, of course, not directly elected, but they are representative of local authorities and the wider stakeholders in the region. Local authority members represent their local authority on the regional planning board.

    Members from other stakeholder groups, such as business or the voluntary sector, will equally speak up for the interests that they represent. Where elected regional assemblies are established, it is right that they should take over responsibility for regional planning, but we do not think we should conflate this with reforming the planning system: that reform needs to happen now.

    Of course, we need the safeguard of democratic accountability. That safeguard needs to be the best one possible, consistent with our current governance arrangements.

    Local authorities speak for their communities—that is what they are elected to do. This Bill, along with the regulations and guidance, guarantees that theirs will be the loudest voice in regional planning.

    Local authorities are in the majority on regional chambers which will be the regional planning bodies. Where there is a consensus there, the local authority view will prevail in the regional planning body's work.

    However, I recognise the concerns expressed. Therefore, Amendment No. 1C highlights the leading role of local authorities and provides a statutory guarantee for the future. The Secretary of State will not be able to recognise a body as a regional planning body unless at least 60 per cent of its members are drawn from county councils, unitary authorities, district councils, national parks authorities or the Broads authority. I hope that the House will be content with Amendment No. 1C. I beg to move.

    Moved, That the House do not insist on its Amendment No. 1, in respect of which the Commons have insisted on their disagreement, but do agree with the Commons in their Amendment No. 1C in lieu thereof.—(Lord Rooker.)

    rose to move Amendment No. 1D, as an amendment to the Motion that this House do not insist on its Amendment No. 1, in respect of which the Commons have insisted on their disagreement, but do agree with the Commons in their Amendment No. 1C in lieu thereof, leave out from "House" to end and insert "do insist on its Amendment No. 1, and do disagree with the Commons in their Amendment No. 1C in lieu thereof".

    The noble Baroness said: My Lords, the substantive issue does not seem to have held the attention of the House as well as the procedural one that preceded it, and I am grateful to noble Lords who have remained.

    When your Lordships asked the Commons to think again on this issue, the reason was because responsibility for drawing up the regional spatial strategy should lie with elected representatives of the communities affected.

    The amendment which the Government are asking your Lordships to consider today in lieu of what we came to call the sunrise clause does not begin to be in lieu of the clause which inserted the proper democratic element into this part of the Bill. Technically, it may be in lieu, but in no other way.

    The Minister in another place recognised the issues of democracy which are at stake, as has the Minister today. However, this amendment does not deal with the issue. I cannot believe that the Government really believe that indirect, partial election to what will be an appointed body is a proper substitute. What is proposed is a minimum of 60 per cent membership drawn from local authorities—including the districts, which are not currently responsible for structure plans—as against draft regulations, which have been in place throughout this House's consideration of the Bill and provide a 30 per cent minimum from the business sector. In other words, at most there will be a 10 per cent shift in membership, but it will not address the point about a direct, democratic connection.

    The Minister in another place said:

    "Local authority members represent their local authority on the regional planning body".—[Official Report, Commons, 29/4/04; col. 1040]

    That refers to the individual representatives' own authority not, as we would see it, having elected representatives elected with the duty of representing their whole region. It is not possible to have local authorities representing all local authority areas. It goes against the grain; if you stood for election to represent your local patch, that would be your priority, and rightly so. I do not want to repeat at too great length arguments I have made before, but indirect election is not adequate for this purpose.

    The Minister also talked of other stakeholder group members speaking for the interests they represent. But we are all wedded to democracy. Instead of appointed business representatives having votes, democratically elected government means representing everyone. I am sure that, more than anybody in this House, when the Minister was elected he felt that he represented all his constituents, whether or not they voted for him. I fear that what the Government propose is divisive.

    We talked before about accountability meaning and engendering faith in the process—the whole issue of trust. I am talking about faith in politics, not just the planning process. The Government say that the amendment would destroy regional planning, but if they came forward with a better democratic input, we would not again have found ourselves considering whether convenience should be placed ahead of democracy.

    The Liberal Democrat and Conservative Benches approached the matter from bases which were, in part, different. I enjoyed the Hansard reference in another place to the fact that the Conservative Party is the parent of "regional panning". That may not have been what the Minister intended to say, but he came rather close to the truth.

    The Conservatives have spoken very powerfully of the connection between citizens, elected government and the role of the counties in structure plans and strategic planning. I hope that they will support the amendment and translate what they have said into legislative terms. I beg to move.

    Moved, as an amendment to the Motion that this House do not insist on its Amendment No. 1, in respect of which the Commons have insisted on their disagreement, but do agree with the Commons in their Amendment No. 1C in lieu thereof, leave out from "House" to end and insert "do insist on its Amendment No. 1, and do disagree with the Commons in their Amendment No. 1C in lieu thereof". —( Baroness Hamwee.)

    My Lords, as my noble friend Lord Strathclyde said a little while ago, this is an extraordinary situation. Some of us have been debating this for a long while and have had many opportunities to talk over the issues. The Bill has suddenly hit the headlines because of the events of the past few days.

    I shall speak at greater length to another amendment later on, but on this amendment, we have supported regional spatial strategies or regional spatial strategy boards in the past only if they are directly elected regional assemblies. I did not know about the reference to "panning assemblies" rather than "planning assemblies". That is an interesting new phrase. One feels that one has been "panning across" the whole of this legislation for some time.

    We have always made it clear that we are opposed to directly elected regional assemblies. We are hoping for "no" votes in the three referenda later in the year. However, we have felt—I echo the noble Baroness, Lady Hamwee—that a democratic element should very much be part of the planning process. I hope that the amendment to which I shall later speak at greater length will cover that issue rather more.

    On this amendment, we have been discussing this legislation for a long while—some 18 months. Although we do not agree with many of the Government's views in the Bill—I have said several times that it needs a lot of work to make it really deliver the Government's objectives—we shall not be supporting the amendment of the noble Broness, Lady Hamwee, this afternoon.

    My Lords, we have not quite hit the headlines, but we shall test the opinion of the House.

    3.42 p.m.

    On Question, Whether the said amendment (No. ID) shall be agreed to?

    Their Lordships divided: Contents, 44; Not-Contents, 141.

    Division No. 1


    Addington, L.MarandKellie, E.[Teller]
    Bradshaw, L.Nicholson of Winterbourne, B.
    Clement-Jones, L.Northover, B.
    Dahrendorf, L.Palmer, L.
    Dholakia, L.Phillips of Sudbury, L.
    Ezra, L.Razzall, L.
    Fearn, L.Redesdale, L.
    Fookes, B.Rodgers of Quarry Bank, L.
    Goodhart, L.Roper, L. [Teller]
    Greaves, L.Russell-Johnston, L.
    Hamwee, B.Saltoun of Abernethy, Ly.
    Holme of Cheltenham, L.Sandberg, L.
    Hooson, L.Sharman, L.
    Hussey of North Bradley, L.Sharp of Guildford, B.
    Jacobs, L.Shutt of Greetland, L.
    Lester of Herne Hill, L.Smith of Clifton, L.
    Linklater of Butterstone, B.Thomas of Walliswood, B.
    Livsey of Talgarth, L.Thomson of Monifieth, L.
    Mackie of Benshie, L.Tope, L.
    Maclennan of Rogart, L.Tordoff, L.
    McNally, L.Wallace of Saltaire, L.
    Maddock. B.Walmsley, B.


    Acton, L.Boston of Faversham, L.
    Ahmed, L.Brooke of Alverthorpe, L.
    Allenby of Megiddo, V.Brookeborough, V.
    Alli, L.Brookman, L.
    Alton of Liverpool, L.Bruce of Donington, L.
    Amos, B. (Lord President of theCampbell-Savours, L.


    Carter, L.
    Andrews, B.Clark of Windermere, L.
    Bach, L.Clarke of Hampstead, L.
    Barnett, L.Clinton-Davis, L.
    Bassam of Brighton, L.Cobbold, L.
    Berkeley, L.Corbett of Castle Vale, L.
    Bernstein of Craigweil, L.Craig of Radley, L.
    Bhatia, L.Crawley, B.
    Billingham, B.David, B.
    Blackstone, B.Davies of Coity, L.
    Blood, B.Davies of Oldham, L. [Teller]
    Borrie, L.Desai, L.

    Dixon, L.McIntosh of Haringey, L.
    Donoughue, L.McIntosh of Hudnall, B.
    Dubs, L.MacKenzie of Culkein, L.
    Elder, L.Mackenzie of Framwellgate, L.
    Emerton, B.Marsh, L.
    Evans of Parkside, L.Masham of Ilton, B.
    Evans of Temple Guiting, L.Mason of Barnsley, L.
    Falconer of Thoroton, L. (LordMassey of Darwen, B.


    Merlyn-Rees, L.
    Farrington of Ribbleton, B.Mishcon, L.
    Faulkner of Worcester, L.Mitchell, L.
    Filkin, L.Morgan, L.
    Finlay of Llandaff, B.Morris of Manchester, L.
    Fitt, L.Murray of Epping Forest, L.
    Fyfe of Fairfield, L.Nicol, B.
    Gale, B.Ouseley, L.
    Gibson of Market Rasen, B.Parekh, L.
    Golding, B.Patel of Blackburn, L.
    Goldsmith, L.Pendry, L.
    Gordon of Strathblane, L.Peston, L.
    Goudie, B.Pitkeathley, B.
    Gould of Potternewton, B.Ponsonby of Shulbrede, L.
    Graham of Edmonton, L.Prys-Davies, L.
    Greenway, L.Radice, L.
    Gregson, L.Randall of St. Budeaux, L.
    Grenfell, L.Rendell of Babergh, B.
    Grocott, L.[Teller]Richard, L.
    Hannay of Chiswick, L.Rogan, L.
    Harrison, L.Rooker, L.
    Haskel, L.Sawyer, L.
    Hogg of Cumbernauld, L.Sheldon, L.
    Hollis of Heigham, B.Simon, V.
    Howells of St. Davids, B.Slim, V
    Howie of Troon, L.Slynn of Hadley, L
    Hoyle, L.
    Hughes of Woodside, L.Stallard, L.
    Hunt of Kings Heath, L.Stone of Blackheath, L.
    Irvine of Lairg, L.Strabolgi, L.
    Janner of Braunstone, L.Symons of Vernham Dean, B.
    Jay of Paddington, B.Temple-Morris, L.
    Jeger, B.Tenby, V.
    Jones, L.Thornton, B.
    Jordan, L.Tomlinson, L.
    Judd, L.Triesman, L.
    King of West Bromwich, L.Turnberg, L.
    Kirkhill, L.Walton of Detchant, L.
    Laming, L.Warner, L.
    Lamont of Lerwick, L.Warnock, B.
    Lea of Crondall, L.Warwick of Undercliffe, B.
    Lipsey, L.Weatherill, L.
    Listowel, E.Whitaker, B.
    Lockwood, B.Wilkins, B.
    Lofthouse of Pontefract, L.Williamson of Horton, L.
    Macdonald of Tradeston, L.Woolmer of Leeds, L.

    Resolved in the negative, and amendment disagreed to accordingly.

    On Question, Motion agreed to.

    Lords Amendment

    3 Clause 1, page 1, line 11, at end insert—

    "(3A) The RSS must include sub-regional plans for all parts of the region in accordance with geographical boundaries defined by the RPB.
    (3B) The sub-regional plans referred to in subsection (3A) shall be prepared by the authorities falling within section 4(1) if their area or any part of their area is in the defined sub-region."

    The Commons disagree to this amendment for the following reason—

    3A Because it is not appropriate to create more than one tier of regional spatial strategy.

    The Lords insist on their Amendment No. 3 to which the Commons have disagreed, for the following reason—

    3B Because regional spatial strategies should be based on the views of local communities.

    The Commons insist on their disagreement to Lords Amendment No. 3, for the following reason

    3C Because it is not appropriate to create more than one tier of regional spatial strategy.

    My Lords, I beg to move that the House do not insist on its Amendment No. 3, in respect of which the Commons have insisted on their disagreement for their reason numbered 3C, but do propose Amendments Nos. 3E to 3J to the Bill in lieu thereof—

    3E Page 2, line 40, at end insert—

    "() The advice mentioned in subsection (1) includes advice relating to the inclusion in the RSS of specific policies relating to any part of the region."

    3F Page 3, line 33, at end insert—

    "() the desirability of making different provision in relation to different parts of the region."

    3G Page 3. line 388, at end insert—

    "(4A) If the RPB decides to make different provision for different parts of the region the detailed proposals for such different provision must first be made by an authority which falls within section 4(2).
    (4B) But if the RPB and the authority agree, the detailed proposals may first be made—
    (a) by a district council which is not such an authority,
    (b) by the RPB."

    3H Page 6, line 11, leave out from "followed" to "section" in line 12 and insert "for the purposes of"

    3IPage 6, line 42, after second "revision" insert—


    3J Page 6, line 42, at end insert—

    "(b) of the RSS as it relates to any part of a region."

    The noble Lord said: My Lords, I do not propose to dwell on Amendment No. 3 itself, other than to repeat, as I have said several times before, that it is not acceptable, because it imposes the burden, red tape and bureaucracy of blanket sub-regional planning, irrespective of whether it is needed or adds value to the planning system. A further problem is that it would require these plans to be drawn up exclusively by county councils and other authorities with strategic planning expertise, and so exclude others who may have an essential and valuable role to play, such as the district councils or regional development agencies.

    I believe that our approach to sub-regional planning is the right one for our communities and our planning system. It is flexible and practical and does not impose an across-the-board, universal requirement for sub-regional frameworks, while it fully supports the involvement of sub-regional partners when there is a clear call for sub-regional planning. However, my right honourable friend Keith Hill said at the last stage in the other place that, given the concerns expressed on the matter, he was prepared to review the package.

    We have therefore looked again at whether there is scope for further compromise consistent with our policy in order to make the arrangements work best on the ground. We have already discussed the statutory guarantee—which we have just agreed again—that at least 60 per cent of the members of each regional planning body will be members of local authorities. It must not be forgotten that we have given county councils and other authorities with strategic planning expertise a mandatory role in advising the regional planning body.

    The amendments in lieu make it a duty that the regional planning body should consider whether it would be desirable to make different provisions in relation to different parts of the region as part of the regional spatial strategy. Therefore, the regional planning body would have to consider whether one or more sub-regional frameworks should be included as part of the regional spatial strategy. The amendments require the regional planning body to seek the advice of the counties and other authorities with strategic planning expertise on the desirability of making such provision. They require one or more of those authorities to take the lead in preparing the draft detailed policies for such a framework. Finally, the amendments provide that one or more district councils or the regional planning body may take the lead when the regional planning body and these other authorities agree.

    The regulations to Part I will need to set out any necessary procedural detail. That might include, for example, clarifying that the sub-regional work would be to a brief set by the regional planning body. In further recognition of the expertise and service responsibilities of county councils, unitary authorities and national park authorities, we will also strengthen their role in the following three ways. First, we will amend planning policy statement 11 to provide that, on major issues of contention between the regional planning body and those authorities relevant to a matter being considered at the examination in public, the panel will ensure that that difference is examined. Secondly, we will amend planning policy statement 12 to make it clear that the county councils' advice should be sought and considered by the district councils in preparing local development documents, and development plan documents in particular, given the county councils' service responsibilities and expertise relevant to plan implementation. Thirdly, we will make it clear in PPS12 that district councils, in planning the preparation of local development documents, should have regard to the capacity of the county council and/or national park authority to provide prompt advice.

    We have long recognised the sub-regional dimension to the regional spatial strategy and the role of authorities with strategic planning expertise in developing that dimension. This dimension will be strengthened in the following three ways. First, we will amend PPS11 to emphasise that although in some parts of a region local development documents should be capable of being prepared within the context of the generic policies of a regional spatial strategy, in other areas it will be necessary to have sub-regional frameworks as part of the strategy. That could be, for example, when important development or infrastructure proposals cross local authority boundaries. Secondly, we will also draw attention to the role of the regional planning body in identifying the need for joint local development documents when this will be helpful in implementing the regional spatial strategy.

    The third way in which the dimension will be strengthened has escaped me, because I have turned over the page and come to the end of my speaking note. Something has gone wrong with my notes—I have only got two bullet points, but I said the following three ways. Because of the negotiations that have been going on, I have read this brief umpteen times, along with lots of other bits of paper. Whether I will be give another bullet point remains to be seen—and in fact I am being told that there are only two. In that case, we have improved the dimension in two rather than three ways.

    What I have just said may sound to non-experts such as myself like a load of technical jargonese, although I have spelled out all the acronyms in full. It is part of a package, which goes along with the procedural agreement that the House approved earlier. With that agreement, I was offered the opportunity of recommending to the Deputy Prime Minister that he introduce a planning (no. 2) Bill, but I pointed out that we would have a bit of a job spelling out the Second Reading reasons for that. Therefore, we have had a look at this.

    I shall be emollient and democratic; I am not at all annoyed; I am very happy. The noble Lord, Lord Hanningfield. has yet to speak, but I put on record that he has acted in good faith throughout the Bill. I have no problem with that whatever. He is a practical man whom I trust. I know he speaks for Essex, but he speaks for the county councils as well, so he will be held to account.

    We have a successful conclusion to the Bill. Sensible people in local government will see the benefit of this legislation. The Bill will change—it is intended to change—the culture of planning in the country for the benefit of our fellow citizens. I do not want anyone to complain that there is no money because, although it is not part of the Bill, we have repeatedly reminded the House that the Government's planning delivery grant will shunt to local planning authorities £350 million over the current spending review.

    As this is probably the last time when I shall be on my feet in relation to the Bill—I hope it is—on a personal note I thank my private office staff and the planning officials for their assistance over the past 18 months. The Bill was part of my day job when ODPM was formed in 2002. The only note of discord that I have—I have put this on record before—is that I hope—that the County Council Network will not thank me for my efforts, as I would not be able to take such a letter seriously. I beg to move.

    Moved, That the House do not insist on its Amendment No. 3, in respect of which the Commons have insisted on their disagreement for their reason numbered 3C, but do propose Amendments Nos. 3E to 3J to the Bill in lieu thereof.—( Lord Rooker.)

    4 p.m.

    My Lords, as I have said, this legislation brings us to an extraordinary situation. For some months—I believe Second Reading took place before Christmas—my noble friend Lady Hanham and I have made various arguments. We do not like much of the Bill, but we took the view that if the Government wanted to pursue this legislation we should make it work. Most of the amendments put forward by us have been designed to make the Bill more bottom-up, and more democratic, than top-down.

    As we said at the beginning, if we are not careful we shall have only one planner in this country, the Deputy Prime Minister. We feel that local people should be involved in planning processes. I am very grateful indeed for what the Minister has just said as it changes fundamentally the processes involved at the bottom level and results in many more local people being involved in the processes of developing planning in this country.

    We accept that sub-regional planning strategies do not need to be universal. That was a recent sticking point as an original amendment of ours proposed that the strategies should be universal. We have accepted that some parts of the country do not need a detailed sub-regional planning strategy, and that planning can take place in different ways. Much of the country does need planning strategies.

    I do not want to continue to quote the situation in my own county of Essex, where we have a new runway at Stansted, the M11 corridor, the Thames Gateway and the Haven Gateway—you name it. we have it—but as the noble Lord, Lord Rooker, has admitted previously, counties such as Essex need to be totally covered by sub-regional planning strategies. Yesterday, the noble Lord visited Essex to discuss issues with some of my colleagues.

    I am pleased to have been able to achieve something with this Bill, even if through a procedural process. As I have said several times, the south-east of the country is the same size as Austria, which would not have just one planning policy; the planning policy that applied to Vienna would not apply to Salzburg,. We need to recognise that our very large regions—we do not support such large regions in the way that the Government do—need to be broken up and then developed. I believe that we have established that through the amendments. I am pleased that we have reached this stage and that some of the arguments that I have put forward throughout the passage of this legislation have now come to fruition. Due to the amendments, I believe that the planning system will work better.

    In the Second Reading debate, noble Lords said that we should be proud of our planning system in this country and that we should be very wary of changing it. With this set of amendments which have been negotiated—they are still not perfect but they are much better than we have had before—the new planning policy can work and it can serve the people of this country. The system will be more bottom-up than top-down and we shall ensure that that happens. The Minister said that he did not want to get to his feet again, but I have one question for him. He mentioned the amount of money in the planning delivery grants. One assumes that that will follow the workload. The amendments may mean that the workload will fall to different authorities—the RDAs, the counties or the districts. Presumably the £350 million will follow the workload. I do not say that it should be designated. but it should follow the work.

    Yes, my Lords, in some ways. The first two years' money has already been disbursed and we are now in the second year of the current spending round. I do riot know how much was allocated; there was something close to £200 million or certainly £150 million left for the third year. but it is a planning delivery grant; it is there to deliver a better planning system. As far as I am aware, the matrix for the third year has certainly not been agreed. Quite clearly, if matters have changed, one would expect a change in the way the matrix works. We were conscious of that in the first year's disbursement of the money. We shall have to take that on board. As I say, the money is paid after delivery of performance. The councils can do what they want with the money and to that extent it is not ring-fenced. Once the money is achieved, the council can use it in the way that it wants, but it has to deliver a better planning performance in terms of development control. The noble Lord's point is well made and I am sure it will be taken on board.

    My Lords, I cannot resist intervening on the resources point. As the Minister says, the grant is for dealing with planning applications, and not strategic work. Throughout the passage of the Bill comments have been made about the strain on the different spheres of authorities with their different responsibilities. There is concern about coupling the pressure on resources and the loss of involvement in taking the lead in structure planning at county level—despite this set of amendments. We all need to be very alert to what that mix will mean in terms of staffing—staff being the most important resource of all.

    My Lords, I thank the Minister for what he has said. He indicated that he would support the money going where the work is. Although the situation has been set out for the first two years, as regards future allocation, I hope that the money will follow the workload, as I believe the Minister indicated.

    He also spoke of the redrafting of the guidance. In the discussions that have taken place over the past few days I have received assurances which I accept, and which he has restated today, that the guidance needs to be rewritten. The Minister is nodding his head. That has been part of the discussions, which are not necessarily germane to the debate today, but he indicated that in his introduction. We can now make the legislation work better than we could have done before, so we accept the amendments.

    On Question, Motion agreed to.

    Public Audit (Wales) Bill Hl

    4.9 p.m.

    Read a third time.

    Clause 54 [ Restriction on disclosure of information]:

    Leave out Clause 54.

    The noble Baroness said: My Lords, throughout our proceedings Clause 54 has been the most controversial clause in the Bill. Its deletion has been recommended by the committee of the Assembly which considered the Bill and was supported by the Welsh Affairs Committee in another place. At previous stages of the Bill these Benches and the Liberal Democrat Benches have also argued that it should be removed. The Auditor-General for Wales has never concealed his dislike of the clause.

    I acknowledge that the Minister and his colleagues in the Wales Office have tried hard to resolve the issue. On Report, the Government introduced amendments to allow Clause 54 to be changed by statutory instrument to bring it into line with any amendment to Section 49 of the Audit Commission Act 1998. But that did not take us to whether the Government proposed to change Section 49. Agreeing to change a clause if a section in another Act is changed is a useful undertaking if it is clear beyond peradventure that the Government are resolved to change that section. We had not reached that point when we last considered the Bill on Report.

    Let me briefly restate our objections to Clause 54. We believe that applying criminal sanctions to the wide-ranging prohibitions on disclosure of information in Clause 54 is wrong in principle. It means that potential whistleblowers, who we should value in a free society, would be treated more harshly, and would be more likely to be deterred. in relation to local government audit than in any other public sector audit environment.

    Let me place on record my thanks for the further work that the Minister has done since Report. He wrote to me last week setting out the Government's latest position and I hope that he will be able to repeat that from the Dispatch Box today. The Government's approach is to align Section 49, and then Clause 54, with the Freedom of Information Act. In doing so, I understand that there will still be circumstances where the Government believe that criminal sanctions will he appropriate for the disclosure of information. Will the Minister say something about those circumstances? At present, Clause 54 is a blanket provision. Can the Minister paint a little more detail about what the refined prohibitions will look like?

    When we debated this on Report, the Minister said that he understood that the Auditor General for Wales would take account of the planned changes to Section 49, and therefore to Clause 54, if he sought to use the Clause 54 powers before they were modified. Given the Auditor General's sensible position on this clause, I believe that we can have confidence in that. But will the Minister confirm that the Auditor General will be involved in the evolution of detailed changes. The Minister's letter to me referred to the Wales Office being in touch with the Office of the Deputy Prime Minister and the Department for Constitutional Affairs. I am sure that the ODPM will involve the Audit Commission in relation to changes to Section 49, given the commission's particular attachment to that section. I would not like the Auditor General to be marginalised in those discussions. After all, we have had rather a lot of the English tail wagging the Public Audit Wales dog throughout the Bill.

    I hope that the Minister will be able to respond positively to these points. I beg to move.

    My Lords, I apologise for the absence of the noble Lord, Lord Thomas of Gresford, who has been very involved in the Bill. He is unable to attend this afternoon. I wish to make only a few points on these amendments.

    The issue of Clause 54, which concerns whether there should be disclosure and possible sanctions, is a very serious matter. I have seen the correspondence of the Minister on this issue. The noble Baroness has made a number of important points in her speech and I know that the noble Lord, Lord Roberts of Conwy, has made some very pungent remarks in relation to these matters from experience in the former Welsh Office. I believe that, as far as public audit is concerned, the disclosure of information is extremely important. There have been discussions about that aspect during the course of proceedings on the Bill and Amendment No. 162 removed the restrictions on the disclosure of information.

    The Local Government Association put forward the argument that it is for the electorate, not an auditor, to decide whether it was satisfied with the services provided. I would submit that electors need facts and it is the auditor who establishes the facts upon which the electorate can judge issues, in particular in relation to expenditure. This is a very important matter. But there are signs of concessions in the attitude that the Government have taken to this matter and it is certainly not the wish of the Liberal Democrat Benches to push this matter further at the present time. I find Clause 54 particularly interesting and fundamental in terms of principle and accountability. I hope that the Minister can satisfy us on these matters.

    4.15 p.m.

    My Lords, it will be recalled that on Report the Government moved an amendment that would enable them, by order, to repeal or relax the restriction on the disclosure of information in Clause 54. The proposed amendment would reflect the findings of a review of statutory bars to the disclosure of information being undertaken by the Department for Constitutional Affairs under Section 75 of the Freedom of Information Act 2000.

    On Report, I confirmed that the order-making power could be used only for the purpose of repeal or relaxation. It could not be used to impose any further restriction. During debate on the amendment the noble Baroness, Lady Noakes, expressed her concern, which she repeated this afternoon, that:
    "We are being invited to leave an unacceptable clause in the Bill against a promise of unspecified amendments in the future".—[Official Report, 1/4/04; col. 1479.]
    Both the noble Baroness and the noble Lord, Lord Thomas of Gresford, who were joined this afternoon by the noble Lord, Lord Livsey, sought more information on the nature of the changes to Clause 54 that the order implementing the DCA's Section 75 review recommendations would facilitate. These are concerns that the noble Baroness re-emphasised today and she feels that Clause 54 should be deleted from the Bill.

    I was happy to confirm on Report that the Government fully understood the concerns expressed about Clause 54 and I gave a commitment that we would take into account all those concerns in a consistent and responsible way. We believe that the government amendment to facilitate a subsequent change in the light of the DCA review bears testimony to that commitment.

    At this comparatively early stage in proceedings—the overall DCA review is not scheduled to conclude until this autumn with the first order implementing its findings being brought forward before the end of the year—I said that I could give no guarantee that I would be able to give any further details of proposed changes at Third Reading. I can, however, report to noble Lords that the Office of the Deputy Prime Minister, as the department with responsibility for the Audit Commission Act, has now formally instructed the DCA to incorporate an amendment to Section 49, the precursor to an amendment to Clause 54, in the first Section 75 order, which will be introduced as soon as possible and certainly before the end of this year. The process of amendment has been formally put into play.

    The instruction is wholly consistent with the Government's preferred treatment for Section 49 that I indicated to noble Lords on Report. The provisions underlying presumption against disclosure will be changed to an overall presumption in favour of disclosure. Freedom of information legislation is very complex and it would be inappropriate for me to preempt the detailed drafting of the Section 75 order. I want to stress again that we are still at a very early stage in the process.

    That said, the practical effect of what is proposed is that information obtained by the Audit Commission or an auditor during the course of an audit or study and held by any public authority could be disclosed by that public authority within the spirit of the Freedom of Information Act. Where the same information is held by any organisation not subject to the Freedom of Information Act, they would also be entitled to disclose it, subject to a limited number of exceptions. At present, such information is subject to an absolute exemption from disclosure under the Act.

    A person or body would be able to make a formal request for information to any public authority under the provisions of the Freedom of Information Act. The presumption in favour of permitting disclosure by a public authority or its staff would not be limited to formal requests for information under the Freedom of Information Act. Section 75 orders allow for ancillary provisions, and it is proposed that the amendment to Section 49 would also cover the voluntary release of such information—proactive disclosure—not related to formal requests, provided it was not of an inappropriate nature.

    The noble Baroness, Lady Noakes, specifically asked what exemptions to disclosure would remain following the Government's proposed amendment. For the purposes of the Freedom of Information Act, information that could prejudice the exercise by any public authority of its auditing functions is classified as exempt information. If the Commission, or another public authority, thought that the release of requested information could be prejudicial in this way, the Act requires it to apply a public interest test in order to decide whether it can be lawfully withheld.

    Details of inappropriate proactive disclosure, for the purpose of inclusion in the Section 75 order, are still being considered. However, in the Government's view, examples of such disclosure that the Government would deem unlawful could be the release of personal information, or the premature release of unverified information for inclusion in an audit report or study. I said during our discussions on Report that these are both examples of disclosure that the Auditor General for Wales's office has indicated he may envisage as exceptions to the presumption in favour of disclosure. A further example of unlawful disclosure could be the release of information for what could be described as malicious or self-serving reasons, such as for motives of personal gain, or with the intention of inflicting harm.

    The Government are of the view that a criminal sanction is still required as a deterrent against instances of unlawful disclosure. The nature of this criminal sanction is still under consideration. I can confirm. however, that the categories of unlawful disclosure provided for in the order will be reasonable, and not undermine the new overall presumption in favour of disclosure. We will, of course, keep the noble Baroness, Lady Noakes, closely in touch with progress.

    Both the Section 75 order amending Section 49 of the Audit Commission Act, and the order-making powers enabling the amendment of Clause 54, will be subject to the approval of both Houses of Parliament.

    The noble Baroness, Lady Noakes, asks about the role of the Auditor General for Wales in the amendment process, and I can confirm that he or she will be consulted as this work develops.

    I do hope that in this rather lengthy speech I have gone a long way towards allaying the noble Baroness's concern and demonstrating the Government's commitment to progressing this issue in a consistent and reasonable way. With that in mind, I would ask her to withdraw her amendment.

    My Lords, I thank the Minister for that comprehensive statement and the constructive way he has worked with these Benches and the Liberal Democrat Benches on this difficult issue throughout the course of this Bill. The information he has provided has taken us a lot further than we had reached on Report, and that is extremely useful. I also thank the Minister for offering to keep me in touch with developments. The only thing left for me to say is that I serve notice that we will be looking at the Section 75 order with very great interest, and look forward to a debate on this, if necessary, later this year. I beg leave to withdraw the amendment.

    Amendment, by leave, withdrawn.

    moved Amendment No. 2:

    After Clause 56, insert the following new clause—


    (1) The Auditor General for Wales must, on request, provide the Audit Commission with any information it may reasonably require for the purpose of making comparisons, in the discharge of its functions under sections 33 and 34 of the Audit Commission Act 1998 (c. 18), between local government bodies in Wales and other local government bodies.
    (2) In this section "local government body" has the meaning given in section 53(1) of the Audit Commission Act 1998 (c. 18)."

    The noble Lord said: My Lords, in moving government Amendment No. 2, I shall also speak to government Amendments Nos. 3, 6, 5 and government Amendment No. 8, which should have been grouped with this group and appears right at the bottom of the Marshalled List by mistake. I apologise for that.

    During our discussions on Amendment No. 5, when originally tabled by the noble Baroness, Lady Noakes, for consideration on Report, the Government expressed the view that a potentially wide-ranging mandatory duty on one body to co-operate with another in undertaking a study, irrespective of the circumstances, could unacceptably limit its operational flexibility in respect of the exercise of its own functions.

    I did give an undertaking, however, that the Government would consider incorporating in the Bill a mutual duty to provide information for comparative purposes on the Auditor General for Wales, the Audit Commission and the Commission for Healthcare Audit and Inspection. The Government amendments tabled for consideration today, we believe, fulfil that commitment.

    Government Amendments Nos. 2 and 8 would require the Auditor General for Wales to provide the Audit Commission and the Commission for Healthcare Audit and Inspection respectively with any information they may reasonably require to undertake relevant reviews and studies in the exercise of their functions.

    Government Amendments Nos. 4 and 6 place a reciprocal duty on the Audit Commission and the Commission for Healthcare Audit and Inspection to provide information that the Auditor General for Wales may reasonably require for the purpose of making comparisons between Welsh and English local government and health bodies, while undertaking studies in accordance with his functions. I beg to move.

    My Lords, I thank the Minster for introducing his government amendments about information duties as between the Auditor General, the Audit Commission and the Commission for Healthcare Audit and Inspection. Our own amendment in this group is Amendment No. 5, but I see that it is amply covered by government Amendment No. 6.

    The Government's amendments derive, as the Minster has acknowledged, from the debates in Grand Committee and on Report as to the information that the Auditor General needs. Indeed, these amendments go further than that, and include the Commission for Healthcare Audit and Inspection. These amendments concern information provision, and therefore fall short of the broader duty of co-operation for which my noble friend Lady Noakes had previously argued. But we concede that these amendments meet our concerns at least halfway and, on the basis that half a loaf is better than none, we are very happy to accept them.

    I should like to apologise to the House for my absence from all proceedings on this Bill after Second Reading, following a close family bereavement. I thank all your Lordships, in all parts of the House, who extended their very generous condolence to my family. I must also give a very special thank you to my noble friend Lady Noakes—who herself suffered the loss of her father during the same period—for not only bravely carrying on, but subjecting the Bill to her inimitable professional scrutiny. The willingness of the Government to listen has paid off, and I am sure that the noble Lords on the Front Bench opposite will agree that the Bill leaving your Lordships' House is much better than the one presented to it. A great deal of the credit for that goes to my noble friend Lady Noakes.

    4.30 p.m.

    My Lords, I should like to add to those words of the noble Lord, Lord Roberts of Conwy, and indeed to sympathise with the situations that he and the noble Baroness, Lady Noakes, faced in the past few months.

    The provision of information for comparative purposes is undoubtedly vital in auditing. It is very important that such information is objective. As the Minister indicated, wording that deals with any additional information which the auditors may reasonably require would satisfy us that the Bill is in better shape than it was before. The provision of information is vitally important.

    I thank my noble friend Lord Thomas of Gresford—who I know would very much have liked to have been here today—for the hard work that he put into the Bill and for his forensic, investigative and positive approach to the Bill. He has done an excellent job on it and I should like that to be recognised in the House.

    On Question, amendment agreed to.

    moved Amendment No. 3:

    After Clause 62, insert the following new clause—


    (1) The Commission for Healthcare Audit and Inspection must, on request, provide the Auditor General for Wales with any information he may reasonably require for the purpose of making comparisons, in the discharge of his functions under sections 145 and 145A of the Government of Wales Act 1998 (c. 38) in relation to a Welsh NHS body, between the Welsh NHS body and English NHS bodies and cross-border SHAs.
    (2) Subsection (1) does not require information to be provided in circumstances where (but for that subsection) the disclosure of the information would contravene section 136 of the Health and Social Care (Community Health and Standards) Act 2003 (c. 43) (restriction on disclosure of personal information by CHAI).
    (3) In this section "English NHS body" and "cross-border SHA" have the meaning given by section 148 of that Act."

    On Question, amendment agreed to.

    Clause 71 [ Commencement]:

    moved Amendment No. 4:

    Page 41, line 29, after "Schedules)" insert ", except section 69,"

    The noble Lord said: My Lords, in moving Amendment No. 4, I shall speak also to the second government amendment in this group, Amendment No. 7.

    Amendments Nos. 4 and 7 are both technical amendments. Amendment No. 4 excludes reference to Clause 69 from Clause 71, which sets out the National Assembly's commencement powers under the Bill. The exclusion is needed because Clause 69 includes an interpretation of references to the Assembly in the Bill and as a consequence will need to be commenced upon Royal Assent, subject of course to the Bill's successful passage through Parliament.

    Amendment No. 7 corrects a drafting error in respect of a reference to Section 51 of the Health and Social Care (Community Health and Standards) Act 2003 made in Schedule 2 of the Bill. The Bill as drafted refers to "reviews or investigations" undertaken by the Commission for Healthcare Audit and Inspection under Section 51 of the Act. In fact, Section 51 makes provision only for the undertaking of reviews, and for this reason the amendment deletes the words "or investigation". I beg to move.

    On Question, amendment agreed to.

    Schedule 2 [ Minor and consequential amendments]:

    [ Amendment No. 5 not moved.]

    moved Amendments Nos. 6 to 8:

    Page 56, line 8, at end insert—


    The Commission must, on request, provide the Auditor General for Wales with any information he may reasonably require for the purpose of making comparisons, in the discharge of his functions under sections 41 and 42 of the Public Audit (Wales) Act 2004, between local government bodies in Wales and other local government bodies.""

    Page 58, line 42, leave out "or investigation"

    Page 58, line 43. at end insert—

    "58A After section 69 insert—


    The Auditor General for Wales must, on request, provide the CHAI with any information it may reasonably require for the purpose of making comparisons, in the exercise of its functions under sections 51, 52 and 57, between English NHS bodies and Welsh NHS bodies.""

    On Question, amendments agreed to.

    An amendment (privilege) made.

    My Lords, I beg to move that this Bill do now pass.

    I should like to express our gratitude to noble Lords, in particular to the noble Baroness, Lady Noakes, for the extraordinarily detailed scrutiny that she and other noble Lords have given to the Bill during its passage through your Lordships' House. I said at Second Reading that we wanted the Bill to be as good as possible and that we would take account of what was said. Some 23 amendments have been made to the Bill as a direct or indirect result of proposals and comments made by noble Lords. We are very grateful for the extraordinary work that has been done on the Bill by all sides of the House.

    I also acknowledge the contribution of the noble Lord, Lord Roberts, to the Bill. He has, as we have expressed, all our sympathy. I was away with flu on the first day of Committee; as we know, he, too, was away. I should therefore also like to thank my noble friend Lord Davies, who, at two hours' notice, took on the first day of Committee. It has been a very successful operation. I again thank everyone who has worked so hard on the Bill.

    Moved, That the Bill do now pass.—( Lord Evans of Temple Gutting.)

    On Question, Bill passed, and sent to the Commons.

    European Union Constitutional Treaty

    4.36 p.m.

    The Minister of State, Foreign and Commonwealth Office
    (Baroness Symons of Vernham Dean)

    rose to move, That this House takes note of developments concerning the draft European Union Constitutional Treaty.

    The noble Baroness said: My Lords, before I update your Lordships on the latest progress in the negotiations on this treaty, I believe that it is important that we try to have some common understanding about the nature of the treaty we are discussing. This House contains some of the finest expertise on Europe and international affairs generally that can be found in any one institution; it is as well that it should be focused on the right target. Sometimes, in the many—and I must say very enjoyable—discussions that we have had in this House over the past months, it has been very clear that opinions on what this treaty seeks to do have been enormously diverse.

    This treaty is not a federalist blueprint to alter the fundamental nature of the relationship between member states and the European Union. It does not and it will not. To take just one example, the wording of its Article 5.1 states:

    "The Union shall respect the national identities of the Member States, inherent in their fundamental structures, political and constitutional … It shall respect their essential State functions".

    This provision expands Article 6.3 of the existing treaty on the European Union.

    There is only one draft under discussion. There are not a number of alternative and quite different treaties from which we can select. We cannot pull our own "Plan B" treaty from out of our back pocket, as the noble Lord, Lord Howell, has rather oddly suggested. To do so would undermine our own negotiating position. I believe that he knows the nature of negotiations rather better than that.

    On the other hand, this draft is not written in stone: it is the subject of negotiation. We have achieved improvements to it already, and we believe that we can secure more. Specifically, we will seek to ensure that it will not remove the national veto on areas of vital national interest: taxation, foreign policy, defence, social security, how the essentials of our common law and criminal justice system work, or treaty change. The Government position on all those issues has been clear throughout.

    The treaty is the product of the convention where British parliamentarians played a full part, with the help of the noble Lords, Lord Tomlinson and Lord Maclennan of Rogart, and of course the honourable Members of another place, David Heathcoat-Amory and my honourable friend Gisela Stuart. As we know, our parliamentarians' opinions on the draft have varied and the Opposition have made much of the doubts that Gisela Stuart expressed on the convention. But let us not forget that she has made clear that the IGC offers us the opportunity to tackle specific concerns about the draft treaty. As she said in another place on 10 December last year,

    "it is Heads of Government who have democratic legitimacy to make those decisions".

    She said later on the same occasion that the treaty,

    "simplifies the procedures, whether those involve the new legal instruments or the decision making of the Council. All that is absolutely essential and it will be beneficial for enlargement … there would be a great danger if it were lost".—[Official Report, Commons, 10/12/03; cols. 1125–26.]

    The resulting draft does, indeed, reflect a great deal of our thinking about how the European Union can be improved: replacing the six-month rotating Presidency with a full-time chairman of the European Council, an important step away from federalism, helping the European Union deliver results; giving national Parliaments the power to object to Commission proposals for legislation—an unprecedented advance in subsidiarity—helping member states to co-operate in crucial areas such as terrorism and cross-border crime; and answering the challenge of enlargement of a Europe of 25 or 27 or 28 nation states.

    We have ended the Cold War division of Europe, and expanded the single market to an unprecedented 450 million people—and now we must make the expanded European Union really effective as well as visionary. The veto must be confined to the areas where it is truly necessary, or else decision-making will become gridlocked.

    The Government believe that the treaty, successfully negotiated, is, indeed, good news for Britain. It gives us a choice about whether to be strong players in Europe, or limping along on its sidelines. Let me explain how.

    The party opposite has admitted that its opposition to the Constitutional Treaty is root-and-branch opposition. Its official position is not to change aspects of the treaty; not to try to improve it; it is against it absolutely. In taking that position, the party opposite has no partners in Europe. No government take that stance, and only in Poland is there an opposition party that espouses such a line. The opposition policy is a policy guaranteed to leave us isolated and on Europe's sidelines. It would also be a fundamental mistake. We want a Constitutional Treaty. We want a rulebook for the EU—a single, simplified one rather than a series of disparate treaties that make up the current rulebook. We want more effective European Union institutions that deliver what citizens want: more co-operation against international crime and a co-ordinated fight against terrorism. We also want member states to work together in the European Union to create a more effective asylum system.

    The Government plan to achieve their objectives in the current negotiations on the Constitutional Treaty. If we do, we shall then discuss the treaty in another place and your Lordships will have the opportunity to give it the detailed and scrupulous attention that it deserves, as you have with previous treaties. When that process is complete, the Government will campaign for its acceptance by the British people in a referendum.

    As your Lordships will know, I have argued against a referendum. Of course, I did; that is a matter of public record. I have thought about this issue a great deal. I do not believe that a referendum is necessary legally or constitutionally. I certainly do not believe that it is necessary because of the fundamentally different nature of this treaty as compared, for example, to the Single European Act or Maastricht. However, I do believe that a referendum is right for the people of this country—for them to decide for themselves whether they want to be at the heart of Europe, where this Government want to be, or relegated to the sidelines where the party opposite wants them to be. I believe that with a referendum our arguments will be where they should be—not on process but on the real substance of this treaty.

    The European Union is not just a set of laws. This is not just a drama played out in the corridors of Westminster and Brussels. It is about a market of 450 million people, the biggest in the world. We export three times as much to that market as we do to the United States. Three million jobs in United Kingdom companies are estimated to depend on the EU. To do that we need to keep its rules. That is what a single market is all about. So we must also be making the rules and influencing the future direction of the Union. We would be doing the people of this country a great disservice if we abandoned our ability really to influence what those rules are.

    We need to help the European Union work efficiently and well, helping to deliver jobs, security and prosperity. Those who argue that we can assure that from the sidelines of Europe by rejecting this treaty are simply fooling themselves.

    Let me turn to the latest developments. Copies of the latest working document issued by the Presidency, CIG 73/04, are in the Library of both Houses. I am sorry that copies of this reached the Library a little later than I had hoped last week. I stress to your Lordships that this is a working document designed for discussion by officials at their "focal points" meeting which took place on 4 May. It covers only part of the issues that are important to us. Far from being a setback for Britain, as reported in some sections of the press, this document confirms gains we have already made under the Italian Presidency, for example, on energy and the passerelle clause. That is welcome.

    The negotiations are continuing. On 17 and 18 May, Foreign Ministers will meet again at the GAERC to discuss the IGC. In advance of that meeting we expect another working document from the Presidency. I shall, of course, ensure that copies are placed in the Library of the House.

    Today provides another opportunity for your Lordships to influence the Government's approach to those negotiations. It is not in our gift in this Chamber to decide the approach of the 24 other member states debating this treaty. Negotiation is not done by diktat. We cannot, as the noble Lord, Lord Howell, seemed to propose, put forward an alternative treaty that has no support from any other member state. We and our European partners continue to regard the convention's draft, into which so much effort has already gone, as a good basis for our negotiations. But we do want to be guided by Parliament, as we have been all along, in setting the UK approach and UK priorities.

    We have discussed the IGC more than 20 times in the past year on the Floor of both Houses. Ministers have attended 10 Select Committee sessions and three sessions of the IGC Standing Committee. I recall that the noble Lord, Lord Maclennan of Rogart, said on a previous occasion that it would be very difficult for the Government to do more. I hope that our debate this evening will be realistic, well informed and based on the facts of the negotiation. I look forward, as always, to hearing a lively and robust debate on this subject. I beg to move.

    Moved, That this House takes note of developments concerning the draft European Union Constitutional Treaty.—( Baroness Symons of Vernham Dean.)

    4.48 p.m.

    My Lords, I thank the Minister for that exposition. My thanks are sincere. Except where she portrayed the position of those of us on this side of the House in a rather negative and, I believe, inaccurate way, the rest was, as usual, extremely clear. As we all recognise in this House, the Minister is immensely skilled at presenting what are basically rather unclear situations in a very clear way. We are all grateful to her for that.

    As the Minister reminds us, these negotiations on this constitution, or Constitutional Treaty—I think that it has to be called one of those two things—are now nearing their end. In a few days there will be another document and some progress will be made. The whole thing has to be tied up by 17 June, which is only weeks away. It is right, particularly in this House which sees itself properly as a safeguard and a guarantor of our constitution, that we should at this stage seek some very detailed information about the Government's overall approach—which has differed somewhat from the approach that they put forward in their White Paper last September—and the policies and some of the tactical details, although obviously not all of them.

    However, my first question is even more fundamental. We have read in recent days about a whole string of new red lines and extra demands to which the Government now say that they will stick. That lacks clarity, because we were told last December that all the red lines had been agreed in essence, so that it was merely a question of tying up the ends. It now appears that there are a whole lot of new red lines, about which the Minister did not have much to say. We need to know which are the red lines that the Government intend to defend. Are the Government really going to stand firm on those red lines? Do they mean what they say?

    For instance, are they really going to get the legal status of the unnecessary charter removed? Are they really going to keep the Union and the European Court of Justice right out of our defence and foreign policy, because that will mean substantial changes to the current draft? Are they really going to halt further integration of social policy? Are they really going to roll back qualified majority voting on asylum issues? Will they halt further extension of EU powers in a whole range of areas and new competences? Will they give Parliament real power to block EU-originated legislation—that means the red card procedure as proposed by Gisela Stuart and many others, which would allow a number of parliaments to block Commission-initiated legislation? Are they going to stop the EU foreign minister from intruding on UK foreign policy and presiding over and initiating policy proposals?

    That is what we really want to know: will they really do those things or is this just talk? Are they going to let us down again? The reason that we are entitled to be a little cynical about all those promises is that if even half those undertakings are to be achieved, that will require quite a different treaty from the one in draft and the one being presently prepared by the Irish presidency—which, according to the latest information that I have, is heading in quite the opposite direction: towards more centralisation and away from the sort of undertakings about which the Government are talking.

    That raises another question. If the Government are really going to be robust, despite what the Minister has told us, what is required is a very different treaty draft from the present text, pointing in quite different directions. One must ask what thought the Government have given to those different directions. What is the fall-back position? What is plan B? I know that the Minister chided me the other day, as she did again today, about raising the idea of airing alternatives, as though in some way any thinking about alternatives is impermissible. But when we look at the situation in Europe, we see that none of that has stopped other European leaders from announcing clear alternatives; namely—they are repeated almost every day now—that if we, the British, block their constitution and vote no, we shall be marginalised and other countries will go ahead to form a core Europe, presumably on a different treaty basis, we will he isolated, and all the rest.

    The Minister asserts that that is what would happen. Indeed, the other day, she and Ministers in the other place were agreeing with that threat about our being, to cite the noble Baroness,
    "pushed to the sidelines".—[Official Report, 29/4/04: col. 890.]
    when Giscard d'Estaing gave voice to that threat. We are entitled to ask why we allow ourselves to be cowed by the former President, Valéry Giscard d'Estaing, by President Chirac, by Mr Pascal Lamy, by Romano Prodi and by other European leaders. Are we not capable of putting forward our own ideas and vision of how we should go ahead in Europe?

    The Minister may say that that is quite unrealistic, but I noticed that only last week the Economist magazine reminded us that Britain is now the richest country in Europe. We have the highest income per head, so we are no longer a poor relation tagging on behind. The Economist reminded us that that the UK continues to grow faster than the euro area and that the gap will widen. We are told that the UK is set to become the biggest economy in Europe—bigger even than the more populous German economy. The Economist states:
    "These economic realities should be remembered when considering the latest fashionable notion in Brussels: the idea that the UK might be chucked out of the EU if it refuses to ratify the new Constitution".
    What outdated and unmitigated rubbish is the notion about being pushed to the sidelines, let alone chucked out. In no other country, in no other EU member state, are people being fed by their Government with that threatening nonsense about being sidelined if they turn down this constitutional document—as, of course, the voters in several states may well do when they come to hold their referendums, as they will. As for the proposition that the constitutional draft that we have now somehow clearly defines or limits the powers of the EU institutions, which we would all like to see, unfortunately, that is anything but clear in the text. On the contrary, a new fog of uncertainty about who has powers to do what is created—a fog behind which it is obvious that big new powers or competences are being sought for the central Union institutions.

    I urge the Minister when she winds up to clarify what has been said by various authorities that we should respect about whether new powers are being taken to the centre or left with member states. The noble Baroness is fond, as have been the Prime Minister and the Foreign Secretary, of citing the Lords EU Committee report last October, which asserts that under the proposed constitution,
    "the balance of power would shift from the Commission to the Member States"—
    I think that I have it right that that is what the Minister was citing the other day.

    The excellent chairman of the EU Committee, whom I see in his place, the noble Lord, Lord Grenfell, made it absolutely clear on 3 December and again on 10 December that the report was referring to the strengthening of the role of the Council and that it meant:
    "The balance of power is shifting to the Council".—[Official Report, 3/12/03; col. 336.]
    Are we to believe the Government's view that the Council is the same thing as the member states? The Council is an EU institution. The Council can override member states by majority vote. No one in common parlance would equate the two. Why do Ministers continue to do so? The only people they are deceiving are themselves. It is a separate institution.

    If Ministers do not believe the evidence of their own eyes about the question of powers—the long list of new competences in which the EU is to become involved, all of them coming under the jurisdiction of the European Court of Justice—let them read another Lords EU report, an excellent one that we have not yet debated on the future role of the European Court of Justice, which we shall debate in a few days' time. In that report, they will find both evidence and conclusions that under the constitution as proposed,
    "the powers of the Union would be increased";
    that there will he a new legal order; that the doctrine of the primacy of Community law will be extended; and that the ECJ will have the final say in defining the extent of member states' powers. That is in paragraph 78 of the European Union sub-committee report on the ECJ.

    We are left wondering what Ministers really believe and whether they really stick to their view that there is no fundamental change in the powers or relationships between member states and the Union. The reason that we are now doubtful about ministerial statements is because they have now chosen to hold a referendum. Why are they holding a referendum if no fundamental changes are involved? The Minister told us the other day that it was a rotten idea—and she was candid and frank about it. The Minister for Europe was saying that a referendum was,
    "only supported by Trotskyists, the National Front and the Rothermere press".
    Now we can add, "the Labour Government", I suppose. It is true that the Labour Government may have shot our fox, although, as has been pointed out to me, the shooting of foxes is now politically correct, so it is not now quite the sin it was.

    All I can say is, thank God—and, by the way, the Deity is sadly omitted from this constitution—that the British people can now vote down a plan to which the only sensible response, as Sir Samuel Brittan, a learned and wise man, said in the Financial Times the other day, is that centralisation has increased, is increasing and ought to be diminished.

    Finally, let me say how sickened some of us are at being accused of being anti-European. The noble Baroness did not make that charge today, but many of her friends have done so. Making that kind of statement is to set in motion what has rightly been called a fraudulent debate. Unlike the Government and, I think, the Liberal Democrats, we on these Benches are perfectly happy to set out the European Union we want to see and the reforms that we believe would really help our country—and an enlarged Europe—to go forward more successfully.

    The Union we want to see is a "live and let live" kind of Union; which anchors national parliaments at the heart of EU decision-making; which really does return powers to the nation states, as this treaty definitely does not; which abhors European empire building; which respects the smaller states and rejects a dominating directorate of the big three; which leaves deeper political integration to those countries that truly want it—even though they will find that this is the slow track, not the fast one, to prosperity, as is proving to be the case; and which is simpler, more democratic and more accountable than anything which this rambling 335 page document even begins to offer.

    Over the next few weeks the Government will claim that their red lines have been protected, even where they have not been. We are ready for that gambit. But, red lines or no red lines, the Government have allowed themselves to be trapped in a process, the outcome of which the British people do not want, which is not in our national interests and which will embitter and divide Europe, not unite it. Worse still—although the noble Baroness seems to believe that it is a virtue—the Government appear to have no exit strategy or alternative way forward. The saving grace is that when and if a referendum comes the British people will firmly and rightly reject the whole idea and most Europeans will breathe a huge sigh of relief. That will be the real time for an "Ode to joy".

    My Lords, before the noble Lord sits down, can I ask him whether, as he takes exception to the Minister's phrase "on the sidelines", he would prefer the characterisation that Britain would he "the only one in step"?

    My Lords, perhaps the noble Lord did not hear what I said. Throughout Europe there are people insisting that they want a Europe that is not top down and not imposed by some top down process—some agenda from the political elite—but want an entirely different, looser and more flexible kind of Europe. Even the Chancellor of the Exchequer has been telling us that he wants a more flexible and competitive kind of Europe and has indicated that there will he no deal on the treaty unless that happens. So we are not alone. The vast majority of modern Europeans understand that they do not wish to be stuck with a hierarchic, out of date, bureaucratic structure that belongs to yesterday.

    5.4 p.m.

    My Lords, it was my pleasure, together with the noble Lord, Lord Maclennan, to be able to represent your Lordships' House during the convention. I should begin by setting on record how grateful I was both to the Select Committee, under the chairmanship of the noble Lord, Lord Grenfell, and the Joint Committee that we had with the House of Commons for their work in scrutinising during the process of the convention. I sometimes wish that it had been done with a little more enthusiasm, particularly in the Joint Committee, due to the number of times that we had to wait to get a quorum and the number of times that we had to adjourn while the quorum disappeared. The hordes were not queuing up to enter the room in order to debate the draft constitution.

    This House should be particularly proud of itself, because it had a commentary and proposals on every suggested draft clause of the new treaty in time for it to be taken into account by the convention. We were the only Chamber of any parliament of the 15, or, indeed, of the 25, to manage to do that. It was of great credit to your Lordships' House that so many members of the convention took your Lordships' opinions somewhat more seriously than it would seem that some of your Lordships currently do.

    In particular, I turn to some of the words of the noble Lord, Lord Howell, in his introduction, because, unlike him, I do not merely "take note" of the draft Constitutional Treaty, but I actually welcome it. I do so because it does not, as the noble Lord, Lord Howell, suggests, introduce new competences. If he has a list of those new competences, perhaps he will ask his colleague to introduce them in the debate, although I am willing to give way to him now if he wants to tell me what they are. Where are the new competences in the draft constitution? I do not believe that they exist. One only has to look at Article 11 and onwards to see the precise definition of competences in the new draft treaty, where it makes it abundantly clear that the European Union is a union of conferred competences, and competences that are not explicitly transferred to the EU explicitly stay with the member states.

    My Lords, as the noble Lord has challenged me, I can certainly give him, or later on provide, the detailed areas where there are six new areas of competence which are acquired by, and ascribed to, the central institutions. But, can the noble Lord share with us, if he believes that the Halter is all so clear, his view of what is meant by the concept of shared competences? Who lays down the sharing and who takes the larger share—the upper or the lower level?

    My Lords, again I have given the noble Lord the reference to that and it is most unsatisfactory to answer one question with another. I notice that we still have no demonstration of a new competence and I look forward to hearing them later in the day.

    The idea that is presented to this House is that we are a nation that is being cowed by Mr Chirac, by Giscard, by Mr Prodi, and by Mr Lamy. The noble Lord can be frightened of them if he wants to be, hut I do not think that they actually have the effect on the population as a whole that the noble Lord attributes to them. If the noble Lord is suggesting that there are reforms that we want that were not considered, perhaps he should have a word with Mr Heathcoat-Amory, who represented the Euro-sceptic point of view from another place so well in the convention and see how far he reached with the proposals that the noble Lord seems to he espousing. He complains about entering into the negotiations without an exit strategy. Perhaps one matter that has been provided, should the noble Lord opposite ever form part of, or he in the supporting cast for, a future government, is that the draft treaty does give the noble Lord an exit strategy—the only one that is available—which is, if at the end of the day one does not like it, get out.

    The reason for having a convention has been forgotten in this debate. We had a convention because there was a process of enlargement; it was enlarging a European Community that started at six, grew to nine, then 10, then 12 and then 15. It was about to increase to 25 and we needed a proper constitutional treaty, a proper methodology of work, so that we would not have a European Union that was hamstrung in its procedures. That historic enlargement required change. One of the changes that have had to take place is that in qualified majority voting.

    However, let us not have phoney lectures about how that is a fundamental change. In 1986 the Single European Act extended qualified majority voting to 12 new or existing areas of Community activity. In 1992 the Maastricht Treaty not only established a common foreign and security policy and justice and home affairs co-operation but also paved the way for the single currency and for many of the new areas of shared competence. The noble Lord might look at his own government's proposals in that area, because that is from where most of the shared competences came. I am delighted to see the noble Lord, Lord Brittan, agree with me. In that case it extended qualified majority voting to 30 new areas. Then there were the extensions at Amsterdam and Nice, which added a further 16 and 31 areas respectively.

    Qualified majority voting cannot of itself be claimed as being such a fundamental change. The extension of qualified majority voting is not the major problem. The major problem is insisting on those so-called red line areas. I merely assert, as clearly as I can, the need to be as clear in pursuing that in the future and not changing our mind as we were about the need not to have a referendum in the early stages of the argument.

    There are some areas on which political circumstances may force a government to change their mind; there are some where the change of mind is not acceptable. I regret the change of mind in relation to the referendum; it was unnecessary. I understand the reasons for which it was made; I will never understand the way in which the decision was made. It was shambolic at best —that is from somebody who is trying to be kind to his honourable and right honourable friends in government.

    Enlargement needs new mechanisms of decision-making. The treaty does not change the fundamental relationships between the European Union and member states. It does not change the basic principles of the Union. It continues to be a Union based on the conferral of competences. I see no reason why we should have presented to us this spectre of a European Union with all the trappings of a superstate. It is hysteria of the worst kind to pretend that that is anywhere inside this document. As a member of the convention who listened extremely seriously to the advice of your Lordships' House during the passage of the convention, I would have had no part of any draft convention that introduced those trappings of the so-called super state into the deliberations.

    The treaty has done many modest things. It has replaced the complex and overlapping set of European Union treaties with a single, more readable document that sets out rights and responsibilities. It establishes clearly the right of member states. In so far as we are criticising the role of the Council of Ministers as a European institution, as the noble Lord, Lord Howell, did, we should put on sackcloth and ashes and criticise ourselves for our incapacity to hold representatives of our Government to account in that process. Those in the Council of Ministers are representatives of member states. In that role they have democratic legitimacy in exactly the same way as we have a duty as representatives of national people to control them.

    I say to my noble friend that I welcome the draft treaty. I regret that we are having a referendum. I look forward to participating in the arguments on the referendum, and I am sure that we will find a basis on which there will be strong support from the United Kingdom public for this sensible, pragmatic series of steps to ensure that we have a European Union that works.

    My Lords, before the noble Lord sits down, I have had time to look up the answer to his challenge to my noble friend Lord Howell. I hope that he will agree that Article 1–12 adds a huge new area of exclusive competence in the treaties. It expands the EU's exclusive external competence to the conclusion of an international agreement which,

    "is necessary to enable it to exercise an internal competence, or affects an internal Union act".
    If that is not enough, the area of freedom, security and justice now becomes a shared competence, which means that we can deal with it only when the EU cannot be bothered. Other such areas include energy, common safety concerns in public health matters, and economic, social and territorial cohesion. I could go on, but this is a timed debate. I trust that that will be enough for the moment.

    5.16 p.m.

    My Lords, it is always a pleasure to follow the noble Lord, Lord Tomlinson, but I take a very different view of the significance of the draft treaty.

    In her opening speech, the Minister said that she would talk about the nature of the treaty, but she did not go very far down that road. For a start, she did not explain why, like other Ministers, she always talks of a constitutional treaty. It is rather odd, because the booklet that I have is entitled Draft Treaty establishing a Constitution for Europe. Is it that the Government do not want to highlight that that will happen? There can be no doubt whatever that the whole object of the exercise is to establish a constitution; that is why it is on the front cover of the document. There is no use making an airy-fairy speech about what may be here and what may be the effect of that. Let us look at the plain language of the draft treaty.

    The constitution having been established as a result of ratification by the member states will then, according to Article 1–1, establish the European Union. As one cannot establish something that already exists, legally the European Union established by the constitution will be a completely new body, a legal entity in its own right, with legal personality. Articles 1 and 6 say so; there is no doubt about that. From then, the authority of the institutions of the European Union will flow not from the member states but from the constitution established as a result of the ratification by the member states of a treaty, which says that it is a treaty establishing a constitution for Europe.

    Remarkably, the Government say that nothing has changed. They say that years ago, when we joined the economic community, we accepted the primacy of EU law over the laws of member states. But what has changed is blindingly obvious to anyone who reads the document. Article 10 reads:
    "The constitution … shall have primacy over the law of the Member States".
    It is the constitution not such laws as may be agreed by the Council of Ministers—a constitution to which the European Union, established by the constitution, will owe its being.

    The European Court of Justice will interpret the often vague and ambiguous words of the constitution. References to an ever-closer Union have gone from the draft but I invite noble Lords—

    My Lords, would the noble Lord be prepared to tell me whether he considers that the Treaty of Rome and the Treaty of Paris, which we ratified in 1972, had primacy over our national law?

    My Lords, I have no doubt that those treaties established obligations that enabled the Council of Ministers to make laws that were then binding on member states and had primacy over the laws of member states. However, those treaties did not establish a constitution; of that there can be no doubt.

    The often vague and ambiguous words of the constitution will, as I say, be interpreted by the Court. References to an ever-closer union have gone from the draft, but the preamble says much the same thing. It says that the people of Europe are determined to be united ever more closely. Can anyone who has followed the findings of the European Court seriously doubt that the Court will do its level best to give meaning to those words?

    We were told that Articles II.51 and II.52 greatly limited the power of the Court to enforce the European Charter of Fundamental Rights. It is interesting to consider what the president of the Court has said about that. He has said that he intends to interpret the convoluted language of that article freely and,
    "not in terms of the lowest common denominator",
    whatever that means. When Ireland's judge was asked whether the Court would hold back from ruling on the charter as a result of the provisions, the reply was:
    "That would be a foolish assumption".
    We are told that Mr Blair is thinking of negotiating changes to the text that would limit the role of the European Court of Justice, but we would be foolish to rely on changes, if any are made. The interpretation will be not in our hands but in those of the Court. Instead, we should recognise the obvious: accepting a constitution at all brings enormous dangers, against which no wording is likely to give us full protection. That is why I and many others are against a constitution.

    It is with the same caution and scepticism that we should approach the Prime Minister's repeated assurances that he will not give an inch on his red lines. Mr Blair says that he will fight to keep the rebate. What is he going to do about Article 53, which ends the veto over the modalities relating to the Union's resources? May not the rebate be said to come within those modalities? Nobody has answered that question clearly.

    The Prime Minister says that he will retain the British veto on tax matters. What about Article 14.1. which says:
    "The Union shall adopt measures to ensure coordination of the economic policies of Member States"?
    What about Article 11.3, which says:
    "The Union shall have competence to promote and co-ordinate the economic and employment policies of Member States"?
    Does not Article III.62, which abolishes the national veto over issues of tax fraud and tax evasion clearly open the door to qualified majority voting on other forms of tax? If the Court gets its teeth into those provisions and into Article 5.2, which, I remind your Lordships, imposes an overall obligation on member states to facilitate the achievement of the Union's tasks, the Prime Minister's red line is likely to be as valueless as John Major's opt-out from the Social Chapter turned out to be, in so far as it was intended to avoid the Working Time Directive.

    What about foreign policy? Article III.282 says that the Court of Justice shall not have jurisdiction with respect to the provisions of Chapter 2, but Article 15.2, which is not in Chapter 2 says:
    "Member States shall actively and unreservedly support the Union's common foreign and security policy in a spirit of loyalty and mutual solidarity".
    It also says:
    "They shall refrain from action contrary to the Union's interests or likely to impair its effectiveness".
    It is clear, therefore, that those sweeping dictates are not excluded from the Court's jurisdiction. The Government say that it is not an integrationist constitution but a constitution that strengthens the role and authority of national parliaments. How on earth does the extension of majority voting to 36 new areas strengthen our Parliament? We are told that it is all necessary to make an enlarged Community work, but why, in a Union that the constitution says is founded on democracy, is it necessary to give more and more power to unelected bureaucrats? Why is it necessary, just because the Community has new members, to have an EU Foreign Minister and an unelected one at that? I cannot for the life of me see how anybody can argue that that has the remotest connection with the need to make a larger Community work.

    We are told that, if we do not go along with the majority, we will be sidelined. The British people are unlikely to be frightened by Mr Pascal Lamy's threat that we might finish up as well off as Switzerland. Instead of heeding such talk, we should listen to the voices of some of the new members of the Union. I wonder whether other noble Lords read a few days ago—I think that it was the weekend before last—the words of the redoubtable new commissioner for Latvia. I think that she is called Miss Sandra Kalniete. She was horn in the Siberian slave-labour camp into which her mother was flung in 1941. She said what she thought of Franco-German domineering and their threats to form a hard core of inner states, if they did not get their way in the EU:
    "I think it is bluff. If you look at these countries, they are the worst at implementing EU law. Now they're worried because they realise they could be outvoted".
    That is what that young lady said. She could see clearly enough that, in a far more diverse Community, the further centralisation of power in Brussels was wholly inappropriate.

    Surely, few doubt that, whatever its successes, the EU today suffers from real defects that the constitution does not begin to address. For the ninth year running, the Court of Auditors has been unable to give the organisations' accounts a clean bill of health. The recent report by the National Audit Office shows that the EU remains riddled with fraud. When we joined the EU and, later, signed the Single European Act, we signed up to reducing barriers to competition, not the regulation of every aspect of economic life. We wanted fresh opportunities, not more red tape; more trade, not more meddling in every nook and cranny of national life. Yet, Regulation 2257/94 really does seek to control the curvature of bananas. The accumulation of EU rules and regulations now runs to 97,000 pages.

    The draft treaty returns not a single task to national level. My noble friend referred to what Sam Brittan wrote in the Financial Times. I agree entirely. He said:
    "A No vote will not destroy the EU but be a signal that over-centralisation has increased, is increasing and ought to be diminished".
    For years, the British people have been the victims of what some have called "Euro-creep". The EU has wrapped itself in more and more of the attributes of a state, without the British people getting any chance to express their views on the matter. Now they have an opportunity to say, "Enough is enough". A "no" vote in a referendum will not end our membership of the Union, but it may well open the door to the radical reform that the Prime Minister himself said was needed only a very few years ago. It may mark the emergence of a simpler and more democratic Europe.

    5.30 p.m.

    My Lords, I shall begin by extending to the noble Lord, Lord Tomlinson, the expression of my complete agreement with every word that he said. He has made it unnecessary for me to say some of the things that I would have said in attempted rebuttal of the increasingly strident opposition to the treaty on the constitution, which is emanating from the Conservative Benches.

    In taking a somewhat more detached view, I hope that it will not so much be seen as aloofness from the debate, but as a recognition that many of the arguments have been heard already and have been deployed. I should therefore prefer to focus on the developments since this House last discussed these issues.

    There have been three principal developments of great importance: namely, first, the change of government in Spain; secondly, the entry into the Union of the 10 new members; and, thirdly, the Prime Minister's apparent intention to hold a public referendum on the result if the treaty is agreed.

    The incoming Spanish Government appear to have incurred no domestic odium as a result of having broadly embraced the outcome of the convention. Indeed, the previous Spanish administration obtained a very good deal for Spain in respect of its budgetary contribution and financial entitlements. The removal, by Mr Zapatero's government, of the Spanish block on the agreed formula for weighting of votes in the Council was an act of justice to the larger states, particularly to the Federal Republic. It is a most welcome development.

    The enlargement of the Union should remind our fellow countrymen of the eagerness of the new members to join. It should also put paid to the argument that we have already heard twice today, deployed from the Conservative Benches, that the draft treaty intends to create or would have the effect of creating a European state.

    All the new member countries participated in the preparation of the draft treaty. In particular, those that had emerged from the thralldom of the Soviet Union made it clear throughout that they would not be willing to subject their citizens to another hegemonic power, nor to have cast away their new-found liberties.

    The draft treaty, far from diminishing our citizens' freedoms, would enhance their protection by empowering the Union to act together effectively in the face of the real external threats to which we are all subject and vulnerable if we stand alone. In the world in which we live today, those threats are economic and environmental, and from terrorism. In each of those spheres, the defences of the member countries of the Union would be strengthened by agreed policies and actions taken in common.

    The decision to hold a referendum appears to have caught even the Prime Minister's closest supporters off balance. It appears to have been motivated more by the short-term desire to wrong foot his political adversaries than by any sense that the adoption of the proposed draft treaty marks a momentous departure for the British people.

    There has been general agreement among the British participants in the process of European integration—I am glad to see a number of them are present today for the debate—that the present draft treaty is of far less significance than were the Single European Act and the Maastricht Treaty. It does not propose a significant transfer of authority to the Union from the member states. The noble Lord, Lord Tomlinson, effectively made that point in his attempt, which I think succeeded, to demonstrate the difficulties that the Opposition Front Bench have in enumerating any such transfer of authority.

    However, it is certainly true that by deciding to hold a referendum, the Prime Minister is elevating the importance of the British debate on the future of the Union and Britain's relationship with it. The grand illusion of which we must all be rid is that the rest of the Union will come to a halt if Britain says "no". The experience of the past decade, to go no further back in the history of the Union, is that if Britain excludes itself from the operation of the Union, it is Britain that stands still, not the policy from which we have opted out.

    We may have boycotted the Schengen agreement on internal frontiers, but the process went ahead. Latterly, we have had to run hard to catch up. We have stood apart from the single currency, but it goes ahead from strength to strength without us. The British experience is, surely, that we do better from within the councils of the Union than from without. Hanging back, as in the case of our original entry into the Community, results in decisions being taken, such as the common fisheries policy, which leave our interests out of account.

    The basic fallacy that has tainted the British debate about Europe has been to regard our relationship with the Union as essentially adversarial. In proclaiming with such emphasis and headline treatment the so-called red lines of the Government, the Government are running some risk of suggesting to the British public that that is a continuing relationship; that the hordes have to be kept at bay; and that Britain, alone of the 25 member states, would succeed where everyone else would fail. That is a travesty of the true "community way".

    The true community way, in aspiration and most often in actuality, is to find accommodations with which all the members can comfortably live. It is and will remain a diverse Union whose purpose in unity is to protect that essential cultural diversity. It is a Union wherein common interests can be defended in common and where unthreatening differences can be enjoyed and even celebrated.

    5.38 p.m.

    My Lords, I am, of course, very pleased that the Government have tabled this Motion so that we have an opportunity to debate the draft Constitutional Treaty as the IGC enters a very crucial phase. As usual, I speak—sometimes with frustration—as chairman of the European Union Committee. Therefore, I shall confine most of my remarks to recalling some of the key issues and conclusions that are set out in the wide-ranging report, which was published last October, on the draft articles that the committee urged the Government to look at very carefully in the course of their negotiations in the IGC. I believe that they have done that.

    During the Italian presidency, we were anticipating that there might be a rush to judgment and agreement last December. Fortunately—indeed, as we recommended in our report—there was no such rush. Instead, the IGC decided to work towards what is bound to be a better outcome, giving itself a longer period for reflection and negotiation. That is why I welcome the debate today.

    I should add that your Lordships will have a further opportunity next Friday, 21 May, as, indeed, the noble Lord, Lord Howell, observed, to debate the recent report from our committee on the role of the European Court of Justice. I commend that report to noble Lords. While it may be that some of your Lordships will touch on that matter—one has already done so during the course of today's debate—I strongly urge the House not to overlook that forthcoming opportunity for a specific and therefore more detailed debate on that particular question in a couple of weeks' time.

    Turning to substantive matters, I remind the House of the first overall conclusion contained in my committee's report on the draft treaty, which is that, with enlargement, it is now necessary to agree a new treaty, as it is generally agreed that the present institutional structure would not function satisfactorily in a union of 25 and eventually more members. I am sure—in fact, there is already evidence of it—that during this debate there will be some hard hitting arguments both for and against the draft Constitutional Treaty. However, I urge the House to recognise that the existing arrangements need to change and that that need lies at the heart of the whole treaty exercise. In my committee's opinion, the draft treaty currently under negotiation sets out many sensible proposals for the institutional changes that are most likely to meet the requirements of enlargement. It is simply not good enough to say that the European Union can stumble on indefinitely on the basis of the arrangements agreed under the Nice Treaty.

    My second substantive point concerns the need for the Government to explain more clearly what the draft Constitutional Treaty is and what it is not. In that regard, we have made some progress today. I was pleased to note the Written Answer from my right honourable friend the Prime Minister in another place on 4 May, which indicates that the Government,
    "will publish a range of material to accompany the Constitutional Treaty, including a laypersons' guide and a comprehensive analysis and comparison of the existing Treaties and the new Constitutional Treaty".—[Official Report, Commons; 4/5/04; col. 1456W.]
    Parliament and indeed the country need to know which provisions in this treaty are new and which are not. Only with that information clearly and factually set out can we tackle the politically more interesting questions that currently form the focus of the debate.

    In the light of the Prime Minister's commitment that I have just outlined, which I welcome, can the Minister clarify whether it is the Government's intention to publish this material before the June European Council, or as soon as possible after it, if that is when political agreement is reached, or towards the end of the year, when it is expected that the legal experts group will have completed its work on the detailed wording of the draft treaty?

    Of course, we cannot expect too much detail to be made public while the final phase of negotiation is continuing. I am, however, grateful for the fact that last week the Minister arranged for the IGC document to be placed in the Library; and we much look forward to the next one. The current document has been drawn to the attention of all our sub-committees, and the Minister can look forward—or perhaps not—to correspondence within the next few weeks on any points that arise. There are a few changes that seem to be quite substantial and a few that would not necessarily be totally welcomed.

    Once political agreement is reached, the Government should move swiftly to make a full range of explanatory material available to Parliament. If, in addition, further perhaps more detailed and more technical material is required once the legal experts have done their work, so be it. But the public, and I am sure this House and another place, will not understand if, having learnt that political agreement has been reached, they are not clear on what text such agreement was in fact arrived at. The agreed text must be deposited in Parliament for scrutiny by all concerned. On that, I am quite encouraged by what the Minister has just told us.

    On a different subject, I ask the Minister what the Government's European Union Strategy Committee has been doing. It seems to have disappeared from our radar screens. My committee recommended that that committee should take a wider remit in informing the public about the EU in general—a recommendation to which the Government gave a positive response. Can the Minister tell us how that and other Cabinet committees are being structured and resourced to take forward the public debate?

    I turn to the draft protocol on subsidiarity, which has already been mentioned by a number of noble Lords. During the course of its deliberations on the convention's work, my committee changed its mind about the yellow card and the red card. Having originally supported a red card, by which the Commission would be obliged to withdraw a proposal to which a substantial number of national parliaments objected, my committee in the end came down in favour of a yellow card alone, on the grounds that having a red card would weaken the impact of the yellow card but, being such a nuclear option, would not itself be a useable tool. Therefore, the committee's final position was that it supported the yellow card and believed that, subject to certain safeguards, it could be made effective.

    Do the Government share our view that, as a matter of practical politics, it would be very difficult for the Council of Ministers to press ahead in adopting a Commission proposal to which a third or more of national parliaments had registered an objection on the grounds of subsidiarity? Does the Minister not agree that that is perhaps the answer to those who feel that, as it stands, the yellow card mechanism somehow lacks teeth? Can the Minister also confirm that the Government will press to have the yellow card mechanism extended to matters of proportionality, that it will apply to all Commission legislative proposals and that the Commission has a clear duty to respond promptly and in thorough detail to objections made by national parliaments?

    Many detailed points in the draft Constitutional Treaty were covered by the committee during the course of its work. I have time to deal with no more than a few of them. I am sure that others will pick them up as we go along. First, my committee concluded that the effect of the draft Constitutional Treaty will be that the balance of power will shift measurably from the Commission to the member states. That recommendation has been much discussed in your Lordships' House and in another place. It has also been raised again in today's debate, notably by the noble Lord, Lord Howell, my frequent and always amiable sparring partner on this particular issue.

    I feel that it is necessary to repeat to the House, as the Minister has very effectively done recently, that the mechanism by which the member states will operate in the European Union will, of course, remain the European Council and the Council of Ministers—hence my committee's conclusion, as is clear from a detailed reading of its report, firmly stands; namely, that the draft Constitutional Treaty has the effect of transferring power from the Commission to the member states meeting in the persons of their representative Ministers in Council. I hope that that clarification will once and for all lay to rest some of the attempts to interpret small chunks of our report when quoted out of context.

    Secondly, the noble Lord, Lord Owen, recently drew my attention to a possible interpretation of Article 21(3), by which the President of the European Council, being precluded from holding a national mandate, might nevertheless not be precluded from also being President of the Commission, as that would be a European, rather than a national, mandate. The Minister for Europe has told my committee that any such provision allowing the President of the Commission also to be the President of the Council would be "completely unacceptable" and that the language in the draft treaty rules it out. The Netherlands appears to disagree. If she can give it, we would welcome further assurance from the Minister in that regard today.

    An outstanding area of general concern is the proposal for a European public prosecutor. While the committee was reassured by the fact that the treaty allows for such development to come in only by way of unanimity, we remain fundamentally opposed to the idea in principle and look to the Government to maintain their continuing opposition.

    In our report, we queried whether CFSP was effectively excluded from the flexibility clause under Article 1–17. We queried whether CFSP was indeed outside the provision of Article 1–10 concerning the primacy of European law. We expressed concern that QM V might come into CFSP. We nevertheless supported a passerelle in Article 1–39(8). I am sure that the Minister will want to take the opportunity, if not today, to spell out precisely how the Government interpret the conjunctive effect of those various provisions as amended by the IGC's latest proposals.

    In conclusion, in a relatively short speech one cannot do justice to all the recommendations in my committee's 41st report on the treaty. I humbly urge the House to read that document again and to examine the Government's response, published in the seventh report of this Session, which contains outstanding government responses from the previous Session. It is in the detail of the treaty articles and, if I may dare say so, in the detail of my own committee's recommendations on them, and in the Government's responses to those recommendations, that Members of the House will find much by way of explanation and elucidation on what is in the treaty and, just as importantly, what is not.

    5.50 p.m.

    My Lords, the benefits of the proposed EU constitution and treaty, especially now that Britain's red lines have been secured, have been well aired this afternoon. My contribution will concentrate on the forthcoming referendum, ostensibly to ratify the treaty but which in reality replays the 1975 referendum determining whether Britain should he in or out of the European Union and whether it should be as a full-blooded member.

    I am helped in this exercise by the useful pamphlet produced by the noble Lord, Lord Blackwell, entitled What if we say no? to the EU Constitution. I look forward to his exposition of the pamphlet later in the debate, and I hope that he will forgive me for some of the things that I am about to say.

    While disagreeing profoundly with the conclusions, I share with the noble Lord an enthusiasm for the single European market and its pivotal position in the shaping of the European Union. I do so not least because I believe that it is the prime source of Britain's and Europe's future prosperity, representing as it does the competitive forcing-house from which Britain and Europe's goods and services are to be sold in local European and global markets. But markets require rules and regulations. If Britain chooses to be part of the European market, which we have, then Britain has to acknowledge a wider jurisdiction. That is life.

    I return to the pamphlet. The noble Lord, Lord Blackwell, suggests that if Britain says no in the constitutional referendum, we should renegotiate Britain's obligations in the single market. That will solidify the impression abroad that Britain is a semidetached member of Europe and of its single market, a fact made evident by our absence from Schengen and the single currency, each of whose major purpose is to strengthen the single market. Incidentally, our absence from the euro and Schengen are cited by Jacques Chirac. this week in Le Figaro as the motive for rejecting Chris Patten as a possible successor to Romano Prodi. That is another straw in the wind of British diffidence weakening our influence and sway in Brussels.

    Refreshingly, the pamphlet lays bare some of the risks to Britain were we to renegotiate our membership of the world's biggest market, comprising some 470 million European citizens. It is conceded that there is a danger that Britain would have to conform to EU market standards without having had a hand in shaping, monitoring or enforcing the rules. There is the danger that rules of origin tariffs might he imposed on manufactured goods assembled in Britain, thereby hurting British firms. The pamphlet freely confesses that there is too the danger that the free movement of workers, one of the market's four fundamental freedoms, might be compromised by any such renegotiation.

    It is further suggested that Britain might join Switzerland and Norway outside the market, but remain enslaved to its rules and regulations. Flow sad that would be for a mighty European power like Britain, how impractical and how full of red tape for a nation of 60 million traders thus to become the tail wagged by the single market dog.

    One final suggestion made in the pamphlet is the invitation to join NAFTA. Whether such an invitation to join has been issued, I do not know, but doubtless we would celebrate with a Mexican wave our transatlantic and Pacific neighbours.

    Other EU initiatives which reinforce the flexibility and attractiveness of the single market are also called into question by the pamphlet. Those include the EU environment policy, regional and cohesion grants, the competitiveness agenda and even Europol and the development of police and Customs and Excise cooperation across the borders of the burgeoning market. Apparently it would be acceptable to frustrate British business while leaving unmolested organised crime to range across the single market. This pick-and-mix, à-la-carte Europe will simply not happen for Britain. In the wake of a "no" result in a referendum, our colleagues will tire of our further opt-outs and prevarications.

    Finally, the pamphlet suggests radical changes to the European Union institutions which make, govern and develop the single market. Top of the list is the overthrow of the European Parliament where democratically elected British MEPs of all political persuasions work assiduously to defend and promote British trading and commercial interests. The European Commission is to be split into an inner ring dealing with the full-time marketeers and a second commission for those beyond the fringe: that would be Britain. Lastly, the European Court of Justice, whose central task is applying single market rules, is likewise to be double-yoked with an inner court, still the ECJ, for those inside the market and a newly created European treaties court for those semi-detached—another astute move in reducing Brussels bureaucracy.

    The pamphlet has done us a great service. It sets out plan B—stay in the market—and plan C—get out and renegotiate—along with several other hopes, aspirations and plans of those who will canvass for a "no" vote in the forthcoming referendum.

    For all its imperfections, the existing single market in the European Union is all we have got. To shun the new treaty now is to introduce chaos in the face of this most welcome expansion to 25 members and to imperil Britain's business, commercial, trading and financial interests which supply the wealth, the jobs and the opportunities that do indeed keep Britain in Europe and the wider world "Great".

    5.57 p.m.

    My Lords, I should like to start with two domestic political points before saying something about the substance of the constitution. This debate is timely. The constitution, or the Constitutional Treaty according to preference, is not yet fully agreed, but there is among all the member states a strong determination to secure agreement next month. I have to say to my noble friend Lord Howell that major change is really completely unrealistic. It is not at all conceivable that substantial changes to the character of the treaty can be put forward, even if they have merit at this stage. On the other hand, the particular points raised by your Lordships' committee and referred to by the noble Lord, Lord Grenfell, are ones which can be raised by Her Majesty's Government and stand a real chance of being incorporated in the final draft. So, whether we like it or not, we have to consider the merits or otherwise of this treaty and this constitution broadly as they now stand.

    The tactics of the Government are clear and frankly not much more credible than those, I regret to say, of my own party. The Government seek to proclaim as loudly as possible their absolute determination to achieve the red lines and then to proclaim huge success in so doing, telling everyone that it is now safe to vote for the constitution. The truth is that in the earlier negotiations, in particular under the Italian presidency, no substantial objections were made to the red lines. What we are talking about now is simply a question of spelling them out with even greater clarity than has been the case up to now. Good luck to the Government if they achieve that because it is a worthy objective, but achieving it would not be a negotiating triumph. Failing to do so would be the result of negotiating cack-handedness.

    We have all been familiar with the art of managing expectations. Nobody in this House who has experience of these matters should be shocked at the tactical approach being adopted. so long as nobody is actually taken in by it.

    Secondly, a word about the proposed referendum. I have never been a friend of referendums. I regard them as an alien, bonapartist device, inconsistent with representative parliamentary democracy. I find it strange that those who hold themselves out as great defenders of the British tradition should be so enthusiastic about resorting to such a device. Resort to it has certainly grown in frequency in recent years but not in desirability. It remains a populist device, usually chosen by a government for purely opportunistic reasons, to get themselves out of a political hole. This is no exception. Whether it will get the Government out of the hole is very much more doubtful.

    Turning to the substance of the constitution, I am glad to say that I am able to speak in less critical and curmudgeonly terms. I have observed at close quarters the creation of previous constitutional treaties, and it is clear to me that what we have here is not a development that is fundamentally novel in character, nor a great step forward towards the creation of an integrated European state. That is why the treaty, frankly, is regarded as a deep disappointment by the genuine federalists. It would be helpful if people in this country heard what those who want what they fear think about the treaty.

    Valéry Giscard d'Estaing said:
    "I think it is absolutely impossible to have a federal state for 25 to 27 countries because it won't work. We have too many specificities, too many languages, and too big a difference in size between Germany, the largest state, and Malta, the smallest".
    That is a statement from somebody who might be regarded as wanting movement in that direction but regrets that enlargement actually makes it impossible.

    It is easy and understandable to be amused by the fact, about which my noble friend Lord Waddington made great play, that what is being proposed has the word "constitution" on the front page and is called a constitution. None the less, in spite of that, I do not believe that it is in character different from previous treaties. Indeed, many of the characteristics of a constitution, as defined by constitutional lawyers and people who write about these matters, existed in the previous treaties. The decision to call this one a constitution and not the others is a political decision and not a profound juristic one.

    What the constitution does is make changes to the institutions. It does not create a new political entity. It is expressly said that the member states create powers in the European Union, not vice versa. That is the fundamental difference between the new political order, founded, for example, in the United States 200 years ago, and what is proposed for Europe today.

    It is interesting that when the general statements in the constitution are elaborated on in more detail, the draft treaty actually says:
    "Under the principle of conferral, the Union shall act within the limits of the competences conferred upon it by the member states in the Constitution to attain the objectives set out in the Constitution. Competences not conferred upon the Union in the Constitution remain with the member states".
    So the constitution is not an overarching new legal order, enabling the newly created body to grab and seize more and more powers.

    A good test in looking at the general direction in which the constitution moves is to ask, as has been said by the committee considering the matter, which institution loses out. Naturally, having been a member of the European Commission for nearly 11 years, I was quite interested to see that. There is no doubt that the institution that loses out in these proposals is the one which is the hallmark of the integrationist approach— the Commission. I do not object to that, but I think I am in a position to notice it.

    Much focus has been put in the discussions on the new President of the Council—whether we should have him for two and a half years and whether we should not have him—and on the title of Foreign Minister. However, the reality is that the powers and instruments of the Commission in the area of foreign affairs will be largely handed over to somebody who will basically be an agent of the member states, and the member states are represented by their governments which, in a democratic society, is the only way in which they can be represented.

    The genuine merits and deficiencies of the constitution can he stated quite simply. It makes changes in the institutions that are necessary to prevent enlargement leading to decision-making paralysis. That is a limited but hugely important objective, which is warmly to be welcomed.

    Achieving enlargement was a formidable and noble task—all the parties in this country were right at the forefront of the fight to bring it about. I can assure your Lordships that it was not an easy fight to win—many people on the Continent did not want us to go in that direction precisely because they thought that enlargement would make a highly integrated union more difficult to achieve. We fought for it and we won it. and it would he an irony but a tragedy if we in this country were now to prevent the changes in the institutions that are necessary to enable the newly enlarged European Union to take the decisions that are needed to gain the full benefit of that historic act of enlargement.

    Of course the constitution is imperfect. It did not start from scratch—it did not try to create ideal institutions. It is, in large part, a work of consolidation. You cannot have it both ways: it does not involve the creation of a new legal order for that reason, and, for that reason, it is also not the simple, elegant, short document that the United States constitution is. It did not seek to reform the policies of the European Union, as opposed to the method of working with the European Union. For example, it does not deal with the reform of the common agricultural policy. But it did make the changes in the running of the European Union that are necessary for enlargement to work effectively and not to prove a Pyrrhic victory.

    What if we fail to ratify the constitution and others ratify it? I do not believe it will force us to leave the European Union. I think that is an exaggerated statement, and the difficulties of forcing us to leave the European Union are very considerable. But I have no doubt that it would certainly marginalise us in it.

    Frankly, although we rightly and inevitably look at these things from a somewhat insular viewpoint, what is much more important than whether it marginalises us is what impact it would have on the European Union as a whole if we were to vote against the ratification of the treaty. Exactly what the impact would be would depend on how many other member states, if any, rejected it and on what grounds. There would certainly be a major crisis in the European Union, not something that could be sorted out by a little tinkering here or there. The effort made to achieve this constitution shows very clearly that its rejection would be a major and damaging act. The European Union would be bogged down, totally preoccupied with handling the situation, and it would be impossible to make significant advances elsewhere.

    We would suffer from the further and ultimate irony: many of those who want to reject the European Union believe strongly that what the European Union really needs most of all is further reform along the lines of the Lisbon programme to make it competitive. They are right—that is the kind of thing that I tried to light for when I was in the European Commission. But the political paralysis that will follow the rejection of this treaty would be wonderful news for those who fear and oppose reform. It would impede, delay and slow down the very reforms that those who oppose the constitution profess to prefer in its place.

    For all these reasons, I fervently hope that the constitution will be agreed with our partners and approved by our people.

    6.10 p.m.

    My Lords, it is always a pleasure to follow the noble Lord, Lord Britian of Spennithorne. The lucidity which he brought to hear on the conduct of business in the European Union has not deserted him now that he has joined your Lordships' House.

    Today's debate on the Constitutional Treaty is taking place in a completely different context from that of our earlier debates on the convention and on last year's intergovernmental conference, and that is because the member states have decided to make a serious effort to reach agreement when they next meet in June—and they are quite likely this time to succeed, the adverse consequences of further deadlock having now sunk in. Even more, the context is different because the Government have recently decided that any text agreed will be submitted in this country to a referendum.

    That latter decision, I deplore and regret. I have always believed that the heart of our unwritten constitution is that we are a representative parliamentary democracy and that the crucial decisions in this country should be taken by Parliament. I do not accept that the referendum is in some way more democratic than a vote by Parliament, particularly when it is almost certain that a smaller proportion of the electorate will vote in this matter than will vote in a general election, and when it is as sure as day follows night that, the day after a referendum, many of those who do vote will complain that they were inadequately informed about the complexities of the issues at stake. Add to that the bias against the treaty of the largest part of the press, which is beginning to live up to the label attached to it in a different context many years ago by a former leader of the main party opposite when he described it as "exercising power without responsibility-, and one has a number of well founded and principled reasons for leaving the decision to Parliament.

    It is a sad but inescapable fact that on each occasion when a referendum on European matters has been embraced by one or other or both of the main parties in this country, it has been so for reasons of short-term domestic political expediency. It was so in 1975 and in 1997, and it is so today. It was not because of any principled view on how those things should he done. Indeed, the party opposite resisted vigorously any recourse to a referendum when ratifying much more far-reaching European treaties—the Single European Act of 1986 and the Maastricht Treaty of 1992—than the one currently under consideration. It was right to do so.

    However, the die is now cast and this House clearly needs to address the issues raised by the Constitutional Treaty in the new context. That means getting away from all the hyperbole and myth-making that has characterised the debate so far. It means getting down to the kind of cool-headed analysis of the provisions of the treaty that—dare I say it?—your Lordships' Select Committee has begun to provide, so that the people of this country, who are being asked to vote on the matter, can begin to acquire the means to form a considered and balanced judgment on it. It means that unsubstantiated assertions such as "this means a massive concentration of power in Brussels" or "it will be the end of Britain as a nation state" will no longer suffice as a serious contribution to the debate. Above all, it means addressing the key alternatives—there are only two in fact—which we will face if the treaty is agreed in June. Do we accept that the new treaty provides, on balance, a viable basis for our continued membership of the European Union? Or do we prefer that basis to be the accumulation of previous treaty texts that we have ratified, with the Treaty of Nice providing the final word on how the new, enlarged union should be run? As a number of other Members have said, failure by this country, or by any other member state for that matter, to ratify is likely in the longer term to have even wider implications than that. However, that is the basic choice that we face and I will concentrate my further remarks on it.

    First, a substantial proportion of the new treaty is simply the repetition or re-ordering of treaty texts which are already in existence and which are binding on this country. I assume—I hope correctly—that that material will raise no problems with anyone who does not wish to tear up our obligations and head for the exit. It would, however, be extremely useful if the Government could rapidly provide a compendium of the material that falls into that category, with clear cross-references to earlier texts.

    Secondly, there is the matter of "tidying-up". That phrase has fallen into disrepute because of the ill advised attempt by the Leader of another place to argue that that was all the new treaty was doing. It clearly goes well beyond just tidying-up, but that does not mean that tidying-up is not a worthwhile and valuable exercise. The impenetrability and complexity of the existing, overlapping texts have been rightly criticised. The new treaty is a substantial improvement on that situation. Again, it would be helpful if the Government would indicate each part of the treaty that falls into that "tidying-up" category.

    Thirdly, we come to the substantive changes. The jury is obviously still out on the changes from unanimity to qualified majority voting. The changes are not all that numerous when one compares the treaty with the original treaty to which we agreed when we joined, which had plenty of provisions for qualified majority voting, and with the changes agreed by previous governments, most notably in the Single European Act and the Maastricht Treaty. In that field, I support the Government's red lines and I assume that they will be achieved.

    The other changes are positively beneficial to this country. Agreement on effective EU policies on asylum and immigration, which is urgently needed and for which we now understand better than we did previously that national action is no adequate substitute, is stymied by the requirement for unanimity. We really must get away from the belief that any change from unanimity to qualified majority voting is a surrender of sovereignty, automatically damaging to this country. Those who assert that could perhaps begin by explaining how we would be better off without the single market, which would certainly not have been achieved without the switch from unanimity to qualified majority voting.

    I turn to the innovations in the new treaty. I shall mention just three. First, one can argue endlessly whether the text in the new treaty on subsidiarity and the role of national parliaments is sufficiently strong and whether it will prove an effective safeguard against excessive centralising tendencies. But one thing is surely pretty clear: it is better than having nothing at all. That is the situation in which we shall be if we reject the treaty and have to rest on the Treaty of Nice.

    Secondly, do we seriously believe that the task of building up a common foreign and security policy will be easier to achieve under the existing provisions than if we move away from the ever more discredited and inadequate system of rotating presidencies? Do we want to stick with a system that will bring the presidency to this country once every 13 or 14 years, rather than one that will provide scope for the main players in the Union to work together effectively?

    Thirdly, do we want to leave the balance between the Commission and the European Council as it is or do we want, through the appointment of a full-time chairman of the European Council, to ensure that the heads of state and government gain more direct, hands-on control over the strategic direction of the Union? Those are far from being all the alternatives that we face, but they are some of the more significant and we now need to focus on them.

    I turn to the issue on which last December's Council was shipwrecked—the attribution of votes for qualified majority voting and the system for reaching majority decisions. I have found no practitioner who believes that the difference between the two systems on offer—the Nice provisions or those in the new treaty for a double majority—would make a real difference in more than an infinitesimal number of cases. It is pretty clear that the double majority system is a great deal more transparent and comprehensible to ordinary people—surely a real advantage—and that it gives somewhat greater weight to the larger member states, of which this country is one. The Nice provisions are not only incredibly complex and hard to understand, but also inequitable. Therefore, while I have a lot of sympathy with Poland and Spain, which feel, with some justice, that they have been misled, I suggest that they need now to swallow their objections and to address any complaints to the President of France, who was ultimately responsible for the unsatisfactory compromise reached at Nice and, by the way, for its subsequent abandonment.

    I conclude with a plea that the debate on which we are now embarking—in this House, more widely in Parliament and in the country—should be conducted on a rational and civil basis. That there are wide differences of opinion is not in doubt, nor is it in doubt that strong views are honestly held on either side. However, as one who spent most of his professional career watching British domestic politics play havoc with the furtherance of our real interests in what was first the European Community and then the European Union, I have concerns that the current debate, if it gets out of hand and is dominated by caricatures, stereotypes and rhetorical cavalry charges, will do precisely that once again.

    6.20 p.m.

    My Lords, it has been an experience of this debate to hear the speeches of the noble Lords, Lord Tomlinson and Lord Maclennan. I use this opportunity to give my own recognition for the work that they did on the convention, although I was not much in line with their views. They must have some regret that their work has resulted in the production of a draft constitution that is giving rise to a good deal of anxiety, held in good faith by people in all corners of the political spectrum. It has given rise to a great deal of disappointment for those who hoped that the opportunity of enlargement would mean a redrafting of the broad rules, taking account of the greater diversity that the Union would have hitherto, along with the necessity for rules that were effective, if limited.

    Those who hoped that that would emerge, dreamed of it in terms of a great production of a horse, while what we have is decidedly camel-like. To those who object and say, "But look, it's not a horse! It's a camel!", what is the riposte? The riposte is, "There is no alternative". That is what we hear, in strident terms, from the noble Baroness, Lady Symons. I must say that it is only a matter of time before she arrives at the Front Bench with a mink-lined handbag.

    I agree with those who are anxious that this debate will proceed to the referendum in a fairly unhealthy intellectual state. I would not put it in quite the patronising terms used by the noble Lord, Lord Hannay, but I think that that is a danger for us all. That is why I am not overwhelmed by the prospect of a constitution. We are rushing into a constitution far too soon after the actual working experience of the enlarged community. Therefore, I have an alternative programme—and yes, I am sorry, it is an alternative. It is not to have the constitution awhile.

    Instead, let us look at a policy of reform that might help to relieve the situation and lead to further developments, which may be broadly more acceptable I refer to a reform of the single market. The noble Lord, Lord Harrison, is a great supporter of and enthusiast about the single market, and I acknowledge that. However, it is not the most star-studded element of the European Union. Originally, it was fairly liberal in its free trade aspect relating to external trade. As we move to the internal market, however, we are being increasingly caught up in the intrusive element of community affairs, and not one with a corresponding advantageous economic consequence.

    Indeed, when I consider the present state of the single market, I believe that it needs reform so that it concentrates on the commanding heights— if I may use an old Labour slogan—and deals in headlines not in footnotes. That is important because unavoidably related to it is that its enforcement is connected with national bureaucracy. That is not a good partnership for the actual existing working of the European Union and the public support and sentiment that the Union should generate.

    But how much more is it a challenge for the applicant countries, whose economies are growing and showing great versatility? The acquis that they have to inherit is, in my view, an incubus. Their whole desire to move towards a more free-market solution for their domestic economies, which is broadly perceptible, is more likely to be damaged than encouraged by the present scope of the single market. I do not comment on their ability through the national bureaucracies to be as effective in enforcing the rules as, say, countries such as Denmark or the United Kingdom.

    I turn finally to the consideration of not only the present problems of the Union and those that will emerge with enlargement but the wider ambitions. They are crucial to be assessed, not as we meet them headlong but as we meet them in anticipation. I say that in the light of the recent speech by Romano Prodi at Dublin, when he said:
    "The goal is to create a ring of friends … In a sense this is another concept of enlargement—an enlargement without institutions".
    That sounds like childbirth without pain, and I do not believe that the matter can rest there. In the Times, Anthony Browne wrote about the Commission comments in the context of the Prodi speech. He said:
    "Under the wider Europe policy countries such as Egypt, Algeria, Libya, Ukraine and Russia would become full members of the single market"—
    that single market which we now see, with its bureaucracy, inclusiveness and its unsatisfactory division between policy and enforcement. He went on to say:
    "with open borders for trade and investment and their citizens given the full right to live and work in the European Union".
    Finally, he said:
    "The policy has been agreed in principle by the national governments of the European Union".
    I would be much happier to hear about that from the Treasury Bench than to read about it in the Murdoch press. That is a warning to us, as we stumble forward towards another great ambition, that until we can resolve some of the real working difficulties of the existing European Union we are falling victim to the principle of over-ambition in government. The phrase from Browning says:
    "Ah, but a man's reach should exceed his grasp".
    That might be a good one-liner for a Victorian poet, but it is no basis for a European policy.

    6.27 p.m.

    My Lords, I welcome this debate on the draft European Union Constitutional Treaty. As a member of your Lordships' Select Committee on the European Union, I thought that I should make a cool contribution to the debate. The committee has produced important reports, and it is important that it should not be left aside in a debate that will continue for some time.

    It was inevitable that the debate would show considerable disagreement. That was certain before we started. I make just one comment—that, having worked at close quarters with the noble Lord, Lord Brittan of Spennithorne, and seen what he achieved for the European Union in vital areas for Britain, especially in international trade and competition, we should give a great deal of attention to what he said today. I make that point particularly because I happen to agree with him, too, but also because of what he has achieved for Europe in his career.

    From recent reactions in the UK, we seem to be in the presence of three scenarios. First, there are obviously those who, if asked to vote for or against the draft treaty, would vote for, "none of the above", because they have a quite different agenda. There are many people who take that position, who would like some matters to be removed from European Union action, would like changes in the Commission's power of proposal, and want no common policy on asylum and immigration, despite recent sustained criticism of national policies, and so on.

    All those and similar issues could have been dealt with in the convention of the people's representatives from national parliaments and governments that began a long time ago—in February 2002. But those representatives did not put forward that sort of scenario. They put forward relatively modest changes in the role of the European Union in the context of its much valued enlargement. That is what we have before us. The treaty is broadly what is now on the table and it is likely to be broadly similar if and when it is agreed unanimously by the 25 heads of state and government.

    In my view the second scenario is the real one, namely, that we have to decide whether the draft Constitutional Treaty, which will probably emerge on 17 June, is better for Britain within the European Union or worse than the current situation. Those who would reject the treaty believe that the changes would represent some kind of threat to our sovereignty or to our role in the European Union. Rejection of the draft treaty would certainly mean—because negotiating fatigue would set in—that for some time at least we would continue on the basis laid down in the Treaty of Rome, as amended by the Single European Act and the Treaties of Maastricht, Amsterdam and Nice, even though some of us believe that some of the provisions of the Nice Treaty are not good, and certainly not good enough for an enlarged Union.

    Thirdly, of course, there are those who believe that the treaty changes put forward by the representatives of the national parliaments and governments, if accepted—perhaps with some amendments—by the heads of state and government, would have some advantage and could be approved by the British Parliament and people. The question is: what are the changes? That is the vital element; that is what the argument is about; that is on what the judgment should be based and not on general assertions in favour of or against the European Union. The first change, evidently, is that the existing Treaties of Rome, Maastricht, Amsterdam and Nice and the Single European Act, which many found difficult to follow, are to go on the bonfire. Their provisions are being consolidated more clearly within a single new treaty. Part 3 of the new draft treaty is very largely—not wholly—that consolidated text.

    I believe that we should concentrate on Part 1 which is the core of the constitutional element of the draft treaty. Although much of the substance exists already in the European Union, in some respects it is quite a new text. We also need to look at the status of the Charter of Fundamental Rights and at the consequences of the decision to change in some ways the treatment of foreign and security policy and justice and judicial co-operation which are currently within the so-called pillars 2 and 3.

    Part 1 of the treaty, which is in about 40 small pages of very widely spaced text, covers all the key elements of the European Union: the definition and the objectives of the Union; the rights of citizens of the Union; the Union's competences and responsibilities and the exercise of those competences; its institutions; its finances; its members; and the specific provisions for the common foreign and security policy.

    When I spoke in the House in September last year I emphasised how very clear and readable that text is. On Saturday I read the text through again. I started at 4.5 p.m. and I finished in good time before "Final Score" at 4.30 p.m. I believe that we have a much better text from the point of view of the citizen. The text is much clearer and to the point.

    Part 1 opens with the values and objectives of the Union, including the promotion of peace and offering its citizens an area of freedom, security and justice without internal frontiers and a single market where competition is free and undistorted. Those are very wide phrases, but Articles 1 to 5 capture the appeal of the Union which has seen so many millions of people seeking and now achieving the membership of 25 countries and by 2007 about 480 million people. Those articles, as the Minister has pointed out, reiterate the requirement that the Union shall respect the national identities of the member states and the essential state functions of those states.

    The competences and responsibilities and the exercise of the competences were formerly scattered about in the treaties. They are now brought together in Articles 9 to 17 and in Articles 32 to 38. That text makes it explicit that the competences not conferred on the Union in the Constitutional Treaty remain with the member states. That point has been mentioned in the debate. It is an important point which needs to be stressed. The competences of the Union are, for the first time, simply listed. They existed, but they are now simply listed: the existing exclusive competences such as monetary policy for those member states that have adopted the euro, areas of shared competence such as environment and transport and areas where the Union may take supporting, co-ordinating or complementary action, for example on industry.

    The treaty also classifies legislation in a slightly different way. It classifies it into European laws or European framework laws, which are broadly what were directives—they leave member states free to choose the means—and European regulations which are broadly similar to our own subsidiary legislation. I am glad to see that it is now proposed in the treaty that the substantive law could require that the delegated legislation may enter into force only if there is no objection from the European Parliament or the Council of Ministers within a fixed period. I hope that that power, if adopted, will be widely used.

    Part 1 also contains the articles about the European institutions. That is a response to enlargement. Looking at the articles it is difficult to be against them; they appear to be relatively straightforward. Instead of the presidency of the European Council changing every six months, the president will be in office for two and a half years, renewable once. From 1 November 2009, which is a long time ahead, the Commission will consist of a president, a vice-president and 13 members with some non-voting members and the Union minister of foreign affairs—however he is finally described—will combine the current role of the special representative and the Commission vice-president. The Council of Ministers will meet in public when legislating. That appears to be a fairly evident package to meet changes in the nature and size of the Union. I know that academics and politicians are extremely interested in institutions. They are important, although at times I doubt whether these useful and necessary changes will cause a great deal of interest or concern to the public.

    All decisions affecting the military or defence will be taken unanimously; decisions relating to foreign policy will become common policy only when adopted unanimously, although some implementing decisions can he taken by qualified majority voting. I hope—this is a new point—that the Minister will be good enough to look at the very latest text that has come round from the Irish presidency, which deals with this point. Speaking from memory, I believe it is Article 201. In any event, in this area the policy of the European Union is tightly constrained.

    Finally, I emphasise that finance is covered by this part also, where the EU resources remain capped and can be changed only by unanimity—in our case by the British Parliament. In practice, the total European expenditure has been well below the limit and represents just over 2 per cent of public expenditure in the Union.

    It is true that some of us did not expect to see the Charter of Fundamental Rights in the treaty, but I have noted very carefully the wording which says that the area of application of Union law is not extended beyond the powers of the Union or any new power or task of the Union established. We have to think carefully about how much we rely on that. I have tried to deal with many important points in rather a short time, but my conclusion is that this matter justifies a request to Parliament and to the British people to approve the draft treaty if it is agreed by the heads of state and government.

    6.38 p.m.

    My Lords, I rise with some trepidation to speak on European matters and on the draft constitution. I am deeply conscious that I am surrounded by many noble Lords who know much more about them than I do. I apologise in advance if I reveal some ignorance of the way in which Europe or the draft constitution work.

    I intend to cover my more natural territory, which is taxation and economic policy. One could see those as a narrow set of areas in relation to the draft constitution which would be true because of the vastly complex issues that arise in relation to it. But taxation and economic policy are not narrow areas for our country, our citizens and our businesses. So I make no apology for trying to deal with those issues today. The Government have often asserted that taxation is a red line area. For example, the Prime Minister said:
    "Issues to do with taxation … will remain the prerogative of our national Government and Parliament".—[Official Report, Commons, 25/6/03; col. 707.]
    But such statements, like so many that relate to the draft constitution are at best harmless spin and at worst positively misleading.

    Article 93 of the Treaty on European Union deals explicitly with harmonisation of indirect taxation and that requires unanimity. To date, we have managed to keep several of our very important derogations, despite a number of attempts by the Commission to take them away from us. We have our veto and it is clearly important that it is retained. But there is no specific reference to direct taxation in Article 93 or elsewhere in the treaty, so there is no explicit veto at present. When the Prime Minister said a few weeks ago that:
    "The national veto must remain in areas such as taxation".— [Official Report, Commons, 20/4/04; col. 155.]
    he could not have been referring to direct taxation since no veto exists. He was perhaps using "veto" in a colloquial sense but that is, in my view, misleading.

    It is generally argued in relation to direct taxation that the fact that there is no reference in the EU treaty means that there is no competence for the EU and there being no competence there is no need for a veto. That is very nice theory but it is not the position in practice, which is why accepting the draft constitution does not achieve the strong defence of the UK's position in relation to direct taxation that the Government would have us believe. The commission has long had ambitions to get its hands on direct taxation. It has tried several times since the 1970s to introduce directives to harmonise various aspects of income tax and corporation tax. Fortunately, it has failed to date but it has not given up. One example is its formal opinion on the draft constitution last year, which made clear its ambitions for a more precise demarcation of the Union's authority in relation to taxation. For "more precise demarcation" we have to read "more power to the commission".

    It is against this backdrop that the UK Government's apparent defence of their taxation powers needs to be examined. The most important current threat to our taxation autonomy is the European Court of Justice. The lack of reference to direct taxation in the EU treaty would reasonably lead to the conclusion that the ECJ has no role. But the ECJ has embarked on a stealthy extension of its jurisdiction, under the cover of enforcing fundamental freedoms in EU law. In particular, Article 43, which deals with the freedom of establishment, has been used as a Trojan horse to attack national tax laws. The ECJ has only really got going on this in the past 10 years and there have been several cases where UK tax law has been found to be in breach of EU law, forcing a change in our law. It started with a case brought by ICI and, for the sake of form, I declare an interest as a director of that company. It was a case on consortium relief that cost British taxpayers quite a lot of money. Recently, the Chancellor had to devote a great chunk of this year's Finance Bill to introducing a raft of bureaucratic and costly intra-UK transfer pricing rules following the German case of Lankhorst Hohorst. Most professional advisers think that a lot more UK tax law will need to change in the wake of that decision and there are many other cases in the pipeline.

    Against that background, the lack of formal competence of the EU in direct taxation matters looks like a side show. If the Government are serious about taxation remaining a prerogative of the government and Parliament it is not a question of defending existing EU treaty provisions. It actually requires a change to the treaty to ensure that the ECJ cannot interfere through the back door in matters for which they have no entry rights through the front door.

    The draft constitution does not appear to tackle tax directly and that is what the Government appear to be pledging to uphold. But there is one area of the draft constitution that holds massive dangers both to our fiscal freedoms and to our economic freedoms. Article 14 deals with the co-ordination of the economic policies of member states—my noble friend Lord Waddington has already referred to this. This is another Trojan horse. Economic policy cannot be separated from taxation policy. It would, I assume, cover the overall level of taxation and quite possibly some detailed provisions. The very lack of definition of what is meant by "co-ordination of economic policy" should be a cause for major concern.

    Article 14 is not merely for those who want to join the euro-zone. That club already has economic rules, as we know. With the growth and stability pact they are observed in the breach as much as in the observance. Euro-zone countries should already be on notice that they are on the slippery path to tax harmonisation. Former commissioner Solbez is reported to have said that member states within the euro-zone cannot be allowed to pursue whatever tax and spending policies they want after joining the euro. The danger in Article 14 is that the rest of Europe, and in particular the UK, will be sucked into that abyss.

    I apologise for taking so much of your Lordships' time on the apparently abstruse subject of taxation. The Government's talk of red lines in taxation is misleading. Our country is already in danger of losing taxation powers through existing treaty rules and will be further at risk if Article 14 is allowed to remain in the final constitution. What we actually need is a robust and unequivocal statement of the commission's lack of competence in relation to national taxation matters, coupled with the ECJ being firmly removed from this territory. Anything less than that will show that the Government's red line on taxation is no more than a figment of their imagination.

    6.47 p.m.

    My Lords, we should be more than ever concerned about the three provisions in the draft treaty which threaten our right of national independent decision in the field of defence and foreign affairs. Article III-195.3 says that,

    "The Union shall conduct the common foreign and security policy by … adopting European decisions on … [the] implementation of actions and positions".
    The passerelle clause, Article 39.8, which our committee has urged the Government to resist, and I am sure that they will do so, gives the Council of Ministers power to decide unanimously to act by QMV. Finally Article III-201.2 says that:
    "The Council of Ministers shall act by qualified majority … when adopting any European decision implementing a Union action or position.
    This last article presents a real problem and a real threat to our power to dispose of our Armed Forces and to pursue our own national defence policy. Under Mr Solana, the EU Council of Ministers has adopted several common strategies, on Russia, for instance, and very recently on terrorism. These express general principles that are, not unnaturally, unanimously approved. It is not much good, however, to have a veto on defence and foreign affairs if that veto can be nullified by the simple formula that implementation of any common strategy will be by QMV.

    I raise this issue in particular because of the implications for our defence resources and capabilities and for the management of relations with other states in the field of secret intelligence. Of the common strategy on terrorism, which was promulgated late last year, we were originally told that the Solana security doctrine would not be part of the treaty. It provides for robust intervention in countries where it is deemed necessary to stabilise a situation. Now this doctrine is recognised and presented as a common strategy, and therefore decisions on it will be by QMV. It provides generally, if we are to take Africa as an example, for an open-ended commitment of troops. And whose troops will form the largest contingent? Ours. Incidentally, the solidarity clause in the draft treaty Article 42 could oblige us to act anyway.

    Mr Solana has secured approval for the apparent appointment of a counter-terrorism co-ordinator, working within the secretariat. New committee structures are to be put in place. There will be,
    "an intelligence capacity on all aspects of the terrorist threat with a view to informing EU policy".
    The further development of the relationship between Europe and the intelligence services is to be taken forward. Europol can usefully co-ordinate and use criminal intelligence, but any effort to require the product of the secret intelligence services—in our case SIS and MI5—to be made available to Europol, whose security procedures have been deeply flawed in the past, would be unacceptable. Bilateral exchanges work well. A requirement to produce sensitive intelligence on a dangerous target to a new EU entity could only produce a lowest common denominator result. The Council secretariat, which was reported earlier this year, I do not know with what truth, to have been bugged—the Russians and the Israelis were named as possible suspects by the press—would present equal difficulties as regards the protection of information. I may say that what is necessary for carrying out the Petersberg tasks is already provided by access to NATO information.

    I am concerned that any facet of the terrorism strategy that leaves the power with the Council to make decisions by QMV because they are implementing a strategy, and which affect the disposal of our troops or intelligence, needs to be identified and resisted. Terror is an important issue, but it is likely to distort the workings of the enlarged Union. The strategy calls for new committee structures, for peer evaluation of national arrangements and, in discussing co-operation with third countries, advocates
    "addressing counter-terrorism concerns into all relevant external assistance programmes".
    The recent allocation of some generous EDF funding to the African Union to enable it to set up an African force capable of entering and stabilising destabilised countries—and the commitment made by the EU to provide, as well as per diem pay, logistical and communications help and transport, presumably air lift—is consonant with the new all-embracing terrorism doctrine.

    It leads me, however, to a further concern. Mr Solana and a proposed foreign minister are to have yet more enormous power, and a portfolio which can only lead to the building of a very large empire. They will be responsible, not only for implementing decisions taken by unanimity in the field of foreign affairs and defence, but, wearing their terrorism hats, they will be free to act wider QMV on terrorism. That will necessarily immensely extend their reach to include the use of national assets such as troops for robust intervention, and development aid money to enable the African Union to carry out peacekeeping operations. and also to respond to and work with the UN globally. I do not challenge any of those individual aims. I simply say that it is an awful lot for two men.

    That, in turn, will affect our national external relations with the countries concerned and our political dialogue at all levels. Third countries will find all this fairly confusing, especially since not only the EU External Action Service but also individual member states speaking through their embassies—that is if we have any left—and no doubt also the UN, will be beating the same drum.

    Most important, however, is the great juggernaut of committees and the largely uncontrolled power which we shall be ceding to Mr Solana and his foreign/ defence/development aid/intelligence co-ordinator Minister, and now his terrorism co-ordinator. What will all this cost, and where are we all to find the skilled people necessary to fill those committees?

    Meanwhile, a programme to help Russia dispose of her vast quantities of WMD—notably 40 tonnes of chemical weapons—has been generously funded for at least eight years with almost no result, except for some nice new roads in Russia.

    I recognise that terrorism is an important issue that must concern us all. There must be value in, for instance, co-ordinated police work through Europol. But the common strategy on terror is likely to prove a very expensive juggernaut. I urge the Government to establish clearly that action on terrorism involving the use of scarce national resources, particularly military and intelligence resources, at the level of the high representative and/or the foreign defence Minister, can be taken by unanimity only. I am, in any case, uneasy about the immense power these two men will have in areas of vital national concern. Foreign affairs and defence are quite enough: to add action on terrorism and the important area of development aid is simply impossible.

    I have another concern for the future which affects the treaty. There are now 25 member states, and we are told the treaty is essential if it is all to work. But that is not the end. We are looking at the preparation for accession, through European partnerships, of six countries in the western Balkans. All are being prepared to apply the infinitely complex acquis, with the eventual object of becoming members of the EU. There are also Turkey, Bulgaria and Romania to come, and it seems that the Ukraine, Moldova, Armenia and other former members of the Soviet Union will also eventually be considered as candidates for entry. Should we not pause for at least ten years, meanwhile giving these countries the same close and useful economic relationship as members of the Barcelona process enjoy? It is unrealistic to suppose that Albania, for instance, has the people and the skills to create a sophisticated, uniform justice system comparable with any member of the Union.

    I would hope to see a period of quiet consolidation within the EU of Poland, Hungary and the other new entrants, so that they can begin to make their own valuable contribution to Europe, to which they have returned thanks to the steadfast presence of NATO and to the eventual collapse of the Soviet system. These countries have been for many years the victims of an over-centralised, inefficient but pervasive bureaucracy, as well as a ruthless dictatorship. They ought now to be given time to make their own particular mark in the EU, before the system gets indigestion from having to take in any more countries. Moreover, they are entitled to a view on that, and a veto, as we are, and may need it more. We should not necessarily regard QMV as the best way to govern. It is simply the most convenient for the bureaucrats.

    6.57 p.m.

    My Lords, over the past few years there has been quite a lot of national debate as to whether or not we should join the European single currency and now the proposed new constitution is swimming into public consciousness. But there has been very little discussion about our present relationship with the European Union, which most people in this country do not really understand at all, although they rightly do not like what they do understand.

    Yet the Government's main line of argument in support of the constitution—and we heard it this afternoon from the Minister—goes roughly as follows: "This is nothing new. The Conservatives gave away much more of our sovereignty when they signed up in 1972 to what has become the EU, and when they later passed the Single European Act and the Maastricht and Amsterdam Treaties. So the proposed constitution is really only a tidying-up exercise, and we cannot see what the fuss is about".

    One cannot really judge the truth of this statement unless one understands what has already been given away, and set that against the proposed constitution. So I thought I would put the briefest of summaries on the record in your Lordships' House this evening. It is some years since that has been done.

    Before I do so, I really must expose the fallacy of the Government and Europhile claim that because some aspects—indeed, many aspects—of the proposed constitution are not new, since they are already in the existing treaties, that means we do not have to worry about them: they must be acceptable to the British people. This argument does not wash, because hardly any aspect of our present relationship has been explained to the people. As the debate on the constitution proceeds, they are therefore free to say "We do not care if some theft of our sovereignty is already in the treaties. We still do not like it, and we want it back".

    I very much hope that this growing awareness on the part of the people will extend to a knowledge of just how far their sovereignty has indeed already been betrayed by their political masters over the past 32 years. I say this because there are at least two fundamental principles which underpin our constitution, our sovereignty, our democracy. The first is the hard-won right of the British people to elect and dismiss those who make their laws. The second is that the people have given Parliament the power to make all their laws for them, but they have not given Parliament the permission to give that power away.

    I submit that both those principles, for which over the centuries millions have willingly given up their lives, already stand deeply betrayed by our present membership of the European Union. It is essential to remember that the people's pact is with Parliament: it is not with the executive or government of the day. The people elect and dismiss Members of Parliament once every four or five years, and our government are, of course, formed out of a majority of elected MPs. But only some 60 per cent of the electorate now bother to vote in general elections, and modern governments are supported by only some 40 per cent of those who vote, or 24 per cent of the electorate. I submit, therefore, that these temporary governments, always empowered by a minority of the people, do not have the right to break the great pacts upon which our sovereignty rests. Yet that is just what they have been doing for the past 32 years.

    So just how bad is the present situation? To what extent could the proposed constitution be fairly described as a "tidying-up exercise"? The detailed process of how huge areas of our national life have already been gradually handed over to control from Brussels in the various treaty amendments, and for which this Parliament has already become a rubber stamp, is to be found in Written Answers in your Lordships' Hansard for 10 July 2003, at cols. 50–51. and for 26 April 2004, at cols. 72–73. Put very broadly. these areas include all of our commerce and industry; all our social and labour policy; our environment, including our agriculture and fish; and our foreign aid.

    By "control from Brussels" I mean of course the system whereby our Government, with 11.5 per cent of the votes, can be outvoted in the Council of Ministers. If they agree or are outvoted on a new law in all those areas, then we in this Parliament must put it into British law on pain of unlimited fines in the Luxembourg so-called Court. That is what is described in Euro-speak as the "democratic deficit", and that is why I say we have become a rubber stamp.

    Our foreign trade relations are in an even worse category because the Commission itself negotiates those on our behalf. So in this area the EU could already be said to have its own legal personality, to which I shall return. In addition, laws affecting our justice and home affairs and our foreign and security policy, if they are agreed by the executive in Brussels, must also be rubber-stamped by Parliament here. If we do not enact new laws in these areas, such as the recent and infamous EU arrest warrant, we would not be subject to unlimited fines, but we would be in breach of our treaty obligations. This, of course, is a far more horrifying prospect than a fine to our political classes in their diplomatic cocktail parties and so on; a fine, after all, is paid by the people. It is not surprising that no law agreed or passed in Brussels has ever been successfully overturned by Parliament. Indeed, the 1972 Act made it clear that that was to be the case.

    So that is a very brief summary of where we are without the proposed constitution. I suppose that you can call it a "tidying-up exercise" if you admit that it sweeps the rest of our sovereignty under the Brussels carpet, which of course it does.

    My Lords, did I follow the noble Lord in his suggestion that the 1972 Act clearly established the primacy of Community law?

    Absolutely, my Lords, yes. If the noble Lord cares to read our debate on 27 June 2003 he will see that I read out the treaty clauses so that they should be on the record in your Lordships' House. They said precisely that. However, I would remind the noble Lord that the Prime Minister of the day, Mr Edward Heath, said that no essential sovereignty was being given away, and the subsequent Prime Minister, Mr Harold Wilson, held a referendum in which he assured us that we were merely talking about staying in a Common Market.

    Other noble Lords have dealt with various features of this constitution. I would single out two which seem to me the most important. First, as other noble Lords have said, it grants the EU its own legal personality superior to that of the member states. There is no longer even the bogus pretence that the EU is an arrangement between sovereign states. Once the constitution is agreed, the EU and qualified majority voting in the Council of Ministers become sovereign. The EU flag, which at the moment is flown as pure advertising, becomes the flag of a new megastate. The EU anthem becomes its official anthem. Alas, poor Beethoven.

    The other feature that has limitless scope for judicial activism by the Luxembourg Court is the inclusion of the Charter of Fundamental Rights in the treaty. I remind your Lordships that Mr Vaz, the then Europe Minister, said that that would have no more status than the Beano. That remains to be seen.

    Those two features alone will ensure that the Prime Minister's famous red lines will soon be dissipated. Indeed, his red line on tax is already breached, as my noble friend Lady Noakes has so expertly revealed, as any noble Lord who cares to read our Unstarred Question on 25 February 2004 will readily appreciate. Briefly, that is because although the tax provisions, being Clauses 90 to 93 of the TEC, still give us the veto over indirect taxation, the treaties appear to be silent on direct taxation, as my noble friend Lady Noakes has said. That is, until you examine the single market provisions.

    My Lords, I thank the noble Lord for giving way. He and the noble Baroness, Lady Noakes, seem to be propagating a new doctrine—perhaps he will elucidate it—that areas that are not covered in the treaty are axiomatically covered in the treaty.

    My Lords, I do not think I was saying that. I was merely saying that direct taxation is not explicitly mentioned in the treaty and that the Court is free to decide that the European Union is free to legislate in the area to which I was about to come. If the noble Lord will hear with me a second, I will explain. I think that my noble friend has already explained how this is happening for corporation tax. My contention is that, potentially, that is open to all direct tax.

    If you examine the single market provisions, you will see that they forbid discrimination among member states and giving "aids"—that is the word in the treaties—to one's own nationals and corporations. Articles 43 and 44 of the TEC repay study to get the full flavour of how our direct tax policy has already been surreptitiously put within the reach of the corrupt octopus in Brussels. I do not say that it has happened yet, but it is there in the treaty. When the Commission wishes to propose and the court wishes to decide, our existing direct tax policy is at stake.

    I conclude by thanking the Government for conceding a referendum on this great matter. That decision has saved some of us quite a lot of work. We Euro-realists now look forward to winning that referendum and rejecting whatever constitution eventually emerges from the secret conclaves of the Eurocrats. I trust that, in the process, the British people will finally come to appreciate the mortal danger in which their democracy already stands and decide to save it for those who come after. I dare to hope, too, that the Conservative Party will then come to its senses and, as a sinner that repenteth, lead our nation back to freedom. Yes, indeed, my Lords, I am always the optimist.

    7.7 p.m.

    My Lords, it is always a pleasure to follow the noble Lord. If I may, I shall preface my comments on the draft constitution by saying how interesting it has been to observe the shift in informed opinion, as distinct from mass opinion, concerning the EU in recent years—the gradual disillusionment of formerly uncritical and wholehearted Enthusiasts. Gisela Stuart is a case in point. The Enthusiasts must be foaming at the mouth that they cannot realistically accuse her of being a little Englander; eine kleine Bayerin does not have quite the same resonance.

    Publications such as the Financial Times and the Economist also have considerably changed their tunes, as the noble Lord, Lord Howell, indicated. Indeed, only the other day the Economist described the EU's policy of subsidising sugar producers as both economically stupid and morally indefensible. That is just one example. One suspects that it is not only many of the EU's actual policies but the disgraceful chronic tolerance of widespread fraud and fiddling, coupled with shameful attempts to intimidate and suppress whistle-blowers, that have generated this disillusionment.

    I turn now to the draft constitution. There is not time to enumerate every field in which it has gone wrong, nor the one or two fields where the proposals are not unreasonable and, indeed, possibly advantageous. I can see that there are one or two. Suffice it to say that quite the worst aspect of the constitution is the extension of QMV to 40 new areas. I never supported either the Single European Act or the Maastricht Treaty so I cannot be accused of inconsistency here. This extension threatens among other things our right to set our own rates of indirect taxation and company taxation—I am neutral on direct taxation; other noble Lords may well be right on that one—and our VAT exemptions, as the noble Lord, Lord Waddington, pointed out, and, even more important, our existing criminal and civil justice system, in consequence of the obligation to "approximate", which I interpret as meaning "broadly harmonise", laws and procedures.

    It may not be realised that under the Irish presidency the draft on harmonisation, or broad harmonisation, of criminal and civil justice has been considerably tightened up. I wonder whether all noble Lords have taken that on board. The new bland-sounding competences over energy could be a Trojan horse threatening our North Sea oil, although the noble Baroness, Lady Symons, in her opening speech revealed that some safeguards have recently been secured in that area. Of course, we are very pleased indeed to hear that.

    However, I should like to concentrate my brief speech upon what the noble Lord, Lord Hurd of Westwell, termed interference in the nooks and crannies of our everyday lives. That must have been quoted at least 200 times in speeches in your Lordships' House and elsewhere, but no matter. It is as valid now as it ever was, and probably more valid. Most of this unjustified interference, which has nothing whatever to do with the free movement of goods, services and people, which is what the EC was originally all about, is already embodied in the allegedly sacrosanct acquis communautaire. It is a disgrace that no effort was made in earlier negotiations by this or any other government to repatriate some of the powers to the nation states, but one has to concede that it would be unrealistic to hope for any action at this late stage, if the treaty is to go through.

    However, some relief from interference of that sort might be expected in respect of future legislation in the form of genuine subsidiarity. Of course, the whole concept of subsidiarity is insulting to any proud, ancient nation state in that it implies that the centre—in this case, Brussels—is the fount of all legitimate power, a small part of which it may graciously deign to devolve. All the same, it is better than nothing at all. But the so-called subsidiarity concessions in the draft treaty are derisory, indeed, laughable. Parliaments of one-third of the member states can object to a proposal, yes, but the Commission can then toss those objections into the dustbin.

    Reverting to his normal Euro enthusiast mode, Quentin Peel, writing in the Financial Times of 6 May, asserted that,
    "the draft constitution leaves the ultimate power in the hands of the member states, not any centralised institution".
    How very wrong he is where subsidiarity is concerned.

    I have two questions for the noble Baroness when she replies to the debate. In the short term can she give an assurance that the Government will insist upon teeth being put into the subsidiarity clauses to provide that where one-third or, better still if it is possible to achieve a quarter or a fifth, of national parliaments object to a proposal, the Commission will be obliged to bow to those objections and cannot toss them aside as the present draft treaty provides? In other words, I am calling for an additional red line. I was delighted to hear that the noble Lord, Lord Grenfell, also feels that the subsidiarity proposals ought to be toughened up somewhat.

    In the longer term, will the noble Baroness urge her right honourable friends to press and press again for competences to be returned to the nation states where purely internal matters are concerned—a partial repeal of the acquis communautaire in other words, so that the proud nation states of Europe can have as much control of their internal affairs as do Delaware or North Dakota?

    7.15 p.m.

    My Lords, I am delighted that I am able to make my contribution to this debate without having to spend most of it making the argument for a referendum. Instead, like other noble Lords, I can move on to the substance regarding the consequences of the UK saying yes or no to what is proposed.

    I predict that when the Prime Minister comes out of the IGC in June he will make two arguments regarding why he believes that the UK should say yes. First, he will say that it is safe to do so because he has succeeded in getting our red lines protected. Secondly, he will say that if we say no, it will be a disaster because, as the noble Baroness already said this afternoon, we shall be thrown to the sidelines of Europe. I believe that both of those arguments are wrong and are misstatements of the circumstances that we face. I shall discuss each of them in turn.

    First, the argument about red lines is almost irrelevant to this debate because, not surprisingly as a tactical politician, the Prime Minister has drawn his red lines around the edge of what is largely agreed. To me and, I suspect, to others in this House it is not what is beyond those red lines that concerns me but what is already inside them in the current draft, which I believe constitute the final brick in moving the European Union from being a single European market to becoming a single European state. When you read through this constitution it is transparent that the structures are there to create the single European state: a single EU legal identity; a Commission as executive which is answerable under this constitution to the European Parliament not to the Council, and where the European Parliament is clearly identified as the direct democratic representation of the citizens of Europe; and where the nations are reduced to a position of voting by majority in what is effectively a senate, but where the Parliament and not the Council has the responsibility and authority to dismiss the Commission and appoint a new one.

    So the structures of a single European state are there, and so, too, as many noble Lords have made clear, are the powers. There is a significant extension of shared competences under this proposed constitution, and competences which can be exercised through qualified majority voting under an EU legal structure which makes those laws pass directly into UK law. It is not only a question of the structures and the powers—as others have said, many of the symbols of an EU state are already there in this constitution to hack up the state as it emerges.

    It is only in the UK that the Government attempt to deny that what this constitution is about is creating the final stage of political union in Europe. It is only in this country that that is even an issue of argument. In every other country that is the starting point for these debates. I am very happy in this Chamber and elsewhere to debate the pros and cons of whether we want to be part of that political union, but I think we should start by accepting the reality that this is what this constitution is about whatever some noble Lords may wish to believe.

    The second argument that the Prime Minister makes is that, whatever opponents of the constitution say, it would be a disaster if we were not part of what Europe as a whole is to sign up to. That is also a nonsense. We are not currently part of what is proposed by the constitution. The big decision would be to sign up to it. The big decision is not whether to veto it and maintain the status quo; the argument has been made for this country, as for every other country, as to why we should want to sign up to it. I do not accept the argument that we need to transfer more sovereignty to Europe because of enlargement. That is a chicken-and-egg argument. We only need to make it easier for Europe to take more decisions in more areas if we want to give it the kind of powers proposed in the constitution. If we wanted to maintain Europe's status as an economic and trading area with plenty of intergovernmental co-operation, there is no need to transfer more powers to Europe so that it can make more decisions more quickly, because we do not want it to take those decisions in the first place. It is a chicken-and-egg argument that does not make the case.

    In reality, if we say "no" to this treaty, either in negotiations or in the subsequent referendum, we will first keep the status quo and then create the opportunity to negotiate a new relationship with Europe—not from a point of weakness, but from maximum strength, because it is clear that several other states in Europe do want to proceed with political union. Good luck to them, but they need our permission to do so. Therefore, we would have maximum negotiating strength to agree the kind of European Union that suits us, rather than to have to take the suit of clothes that others have designed for their own purposes. We should seize that as a great opportunity for this country finally to achieve the kind of relationship within Europe that we want.

    The disaster would he if we went into this constitution, not if we stayed out. It would be a disaster because, among other reasons, it is a blueprint to move the European Union from a free trade area to a centrally managed, high cost, social market economy. That is at the heart of the treaty. The objective is set out in Article 3, which the noble Lord, Lord Williamson, quoted with approbation. I am more focused on the fact that it makes clear that the union is working for "a social market economy". I am not sure that I or the population signed up to be a social market economy, which will be,
    "aiming at … social progress … combat social exclusion and discrimination … promote social justice and protection",
    "solidarity between generations",
    and so on. This is a European Union constitution embedded in Article 3, which contains a set of objectives which, if interpreted by a European Court, would allow all kinds of decisions to be forced on this country that come from a particular political perspective and not one that this country has ever signed up to or that this Government have the power to say that this country should always he signed up to.

    Against that objective one must recognise the significance of the clauses quoted in Article 14 that expand the scope for economic co-ordination and indeed the requirement for countries, whether or not in the euro, to be part of economic co-ordination. We should add to that the Charter of Fundamental Rights, which, as opposed to being a charter that sets out individual rights, is largely a charter about setting out collectivist rights of EU-approved institutions that are part of the social market. Therefore, there is a set of clauses under the title of "Solidarity", which refer to,
    "workers' rights … collective bargaining and action … the right to limitation of maximum working hours … entitlement to social security benefits and social services",
    and even state that,
    "the Union recognises and respects the right to social and housing assistance so as to ensure a decent existence for all those who lack sufficient resources".
    We are opening up a panacea for all those who believe in creating a social state—to use the words of the constitution, to strike down any action that any government might take that comes from an ideology based on free markets and individual responsibility and to challenge that as being incompatible with a constitution which we have signed up to. That is not only not wanted by the people of this country, but it would be a disaster for this country, because it would lock us into, against our will, a high cost, protectionist model of how to run the economy—a model that has already been disastrous on much of the Continent. It is the failure of many European countries to move from the old industries into new services at the speed that the UK did, which has led to their static productivity and low growth. That has led them to try to protect their uncompetitive economic position, to create inflexible labour markets, to try to protect the position of those currently employed and to hold back the tides of global competition. It is that mind set which will ultimately threaten the bankruptcy of the euro system under the strains that will be imposed on it, if courts interpret these articles as unlimited rights to give benefits to all kinds of people without ever asking where the wealth will come from to pay for those costs.

    The last thing that the UK wants is to be locked into a constitution that forces us into that grim future where our economic policy and our social policy is dictated by a political model to which we do not, I hope, subscribe. Even membership of the single market should be open to question, as the noble Lord, Lord Harrison, mentioned. Yes, there are risks to being outside the single market, but we must recognise that it is an issue that should now be genuinely debated, because tariffs across the world have now come down considerably—we no longer have to be in the single market to enjoy such low tariffs. Tariffs across the GATT area are now less than 4 per cent; but, the single market has become the engine, not of free trade, but of regulation. It is that regulation, empowered by the desire to protect European industry, which is putting up our costs and destroying our competitiveness. We need a serious debate about the pros and cons of being in the single market, although there are benefits to being inside a trading area, which does need to be the same as the single market.

    So there are alternatives. We have to consider them, because the prospects of signing up to the constitution are so disastrous. I shall not spend time going through all of those as the noble Lord, Lord Harrison, did an excellent job of summarising some of the institutional arrangements that we might adopt and they sounded extremely attractive as he listed them.

    In summary, this is an opportunity for us to achieve the kind of relationship that we want—no longer to be forced into a Europe of two speeds, where we are dragged along behind, but, instead, to create a Europe of two destinations, where those who want to proceed into a single European state and those who, like us, want to remain independent states within a Europe of nation states, do so. I have no doubt that we should stay in the latter group and the sooner that we make that clear to our EU neighbours and negotiate an EU that suits us, on our terms, the better.

    7.28 p.m.

    My Lords, it is always a great privilege to follow the noble Lord, Lord Blackwell. I would like to return briefly to the subject raised by the noble Lord, Lord Pearson—the question of the democratic deficit. Whatever the wider intent of the new EU constitution, few would argue that it will not remove, over many areas, our competence, as a nation, to govern ourselves.

    I, like many, believe that that process has already gone too far and what we should be talking about is making subsidiarity a reality, not just a promise. I am indeed heartened to see that the Conservative Party has made that broad concept part of its manifesto. I am equally not surprised to see that the Liberal Democrat Party continues to wish to give away the governance of this country. Manifestly, the Liberal Democrats would be so hopeless in government that they are only too delighted to see other politicians take our decisions for us.

    Leaving aside political banter, I should like to reflect for a moment on what makes democracy work. Why democracy works is hard to define. It is complex and, in reality, as our own electoral system shows, it is not just government by those who have achieved most votes but government by the consent of all. However bad our least-worst system of democracy is, it acts as a safety valve and, above all, allows the electorate to remove from power those who have either taxed or regulated them, they believe, unreasonably.

    Ever-closer union with Europe works in the opposite direction. Increasingly, we have taxation without representation and its twin, regulation without rectification. That is the window through which the general public see the European Union. To them it is bureaucratic, pedantic and unnecessary law making. The majestic concept of a new European order, sacrificing national ambition for a wider European good, cuts increasingly little ice with our disillusioned electorate, as every poll shows. They do not like what they see.

    What is more, one glance at football crowds shows that nationalism is far from dead. "Circuses" may be the popular outlets in times of prosperity, but in adversity the electorate would look for the ability to control those who govern, tax and regulate them. The football crowds will want their interests put first; they do not want to be governed by strangers. They could turn ugly when bread comes before circuses.

    Our existing form of democracy may be imperfect, but it has given us social and political stability, the essential foundations of economic prosperity. To predicate future political stability on the past would be foolish. Our existing democratic framework will be stretched representationally from one MP to 65,000 voters to one Euro MP to approximately three-quarters of a million voters.

    The democratic elastic will snap, because the new arrangements carry no sensible framework for the rectification of bad taxes, bad laws and bad regulations. For that reason, if we want even the existing EU framework to hold, we should be talking about real subsidiarity and the substantial repatriation of powers at national level—genuine reform, as expressed and advocated so well by the noble Lord, Lord Biffen.

    It is deeply important to recognise that the democratic deficit is even more inherent in this new EU constitution with its wider powers. As framed it is not responsive to the wishes of our electorate and the democratic processes that we are used to. The conventional political safety valves are being sealed up by a rotten, and often corrupt and self-seeking, European elite. This so-called constitutional reform will make matters worse.

    In conclusion, I shall quote from the profound work on the subject by Professor Larry Sidenthorpe, of Oxford University. He argues that the rule of law is reliable and durable only when it is rooted in popular habits and attitudes. That is the problem facing federal Europe. He argues that law making is very different from the problem facing economists, bankers and Industrialists:
    "The creation of new wants may be the key to economic growth but by contrast creating a culture of consent is a far more precarious undertaking for such things depend on the degree of self-control a society is able to generate and sustain".
    He further states:
    "The danger of premature federalism in Europe, the rush for political integration which turns federalism into little more than a mask for a unitary superstate, is that it could put at risk the complex texture of European societies. It is far from clear that they could long tolerate subordination under a central rule making agency which pitched its actions at the level of a common denominator".
    Wise words, my Lords.

    In our country we have an unwritten constitution, which, when it is changed slowly, has enabled us as a nation state to adapt and to grow without serious civil unrest. If the new EU constitution is ratified in anywhere near its present form, it will finally destroy our historic framework of self-government and the inherent democratic deficit in its structure will sadly sow the seeds of its own inevitable decline, bringing an end to the dream of a Europe at peace with itself. That is why this new constitution must be resisted and substituted by the only thing that will save Europe: genuine subsidiarity and the repatriation, not further surrender, of national powers. I hope that this debate will further that process.

    7.35 p.m.

    My Lords, I am grateful for the opportunity to debate this issue tonight, particularly as the Irish presidency has been giving the kiss of life to what at least some of us hoped was the moribund corpse of the constitution.

    The unwelcome news of the kiss of life was given to us last Wednesday by the Minister, in response to a Starred Question by the noble Lord, Lord Grenfell. She stated then that,
    "we are placing in the Library of the House copies of the presidency's proposals that were issued last week".—[Official Report, 5/5/04; col. 1105.]
    As ever in the EU, what you see is not necessarily what you get. It now turns out that what the noble Baroness thought were presidency proposals and what she told us were presidency proposals were not presidency proposals at all. They were, apparently, as the Government's spinmeisters have now been telling us, purely "working documents" and,
    "not in any way a fresh overall presidency proposal".
    I can agree that it was not a fresh overall, but I am afraid that it looks like a presidency proposal, and a very unpalatable one at that. The non-presidency proposal contains 50 proposals on 130 pages. I was amazed and astonished, as I am sure other noble Lords were, to find that all those proposals moved powers from national parliaments to the Commission, and that every single proposal would increase the power of the Eurosalariat at the expense of national parliaments. How very surprising.

    In foreign affairs, for example, under the non-proposals it is suggested that when deciding on a proposal from the Union Minister for Foreign Affairs, whoever that grandee may be, the Council shall act by QMV. That is provided in Article III-201 of annex 25, on page 68 of the non-proposals. It says that qualified majority voting must he used,
    "when adopting, on a proposal from the Union Minister for Foreign Affairs, a European decision defining a Union action or position".
    I have bad news on taxation for my noble friend Lady Noakes. Again the non-proposals propose that, although the Council appears to be required to act unanimously, as soon as it finds—that is the word in the document—that the measures it wishes to legislate against,
    "do not affect the fiscal regimes of the Member States",
    it can act by QMV. Bang goes another red line.

    I think that noble Lords will have got the message. In whatever area—justice, home affairs, foreign policy, economic policy or employment—the traffic is all one-way: to the unelected Eurocracy and away from the member states and their elected parliaments.

    The repeated assertions by our Europhile friends that the constitution will give more power to national parliaments is what Touchstone in "As You Like It" called the "Lie Circumstantial" or even the "Lie Direct". I was surprised to hear the Minister and the noble Baroness, Lady Williams, last Wednesday engaging in a double act, agreeing that,
    "there will be more power coming to national parliaments".—[Official Report, 5/5/04; col. 1107.]
    The noble Lord, Lord Grenfell, made a valiant attempt to explain his committee's support for the yellow card system. However, the reality is clear: the current constitution says that if one-third of member parliaments object to a Commission proposal, the Commission must "review" its proposal; when it has reviewed the proposal, it is at perfect liberty to say, "Thank you very much for those interesting comments. Unfortunately, they seem to have found their way into the Commission wastepaper basket. By the way, don't slam the door on the way out".

    I shall borrow the Prime Minister's brand of would-be cool rhetoric. It is kind of dumb to pretend that the draft constitution returns any power to member states. I am happy to give way to any noble Lord or noble Baroness who can give me an example of such a return of powers or competences to national parliaments. There are none, so I have not been interrupted. It is kind of dumb to pretend that we need the constitution to make the EU more efficient. How many Members of your Lordships' House believe that the weakness of the EU lies in its inability to enact regulations? The acquis runs to 97,000 pages. Over 100,000 regulations have been imported into UK law, yet we are asked to swallow the idea that we should allow the EU to pass even more laws in even more areas. The EU already contains the most highly taxed and highly regulated economies; now, the Eurocrats want the power to make things worse. Give me a break.

    It is kind of dumb to pretend that the draft constitution does not give away more powers to the centre. The constitution will abolish the national veto in over 30 areas of policy. What is that, if it is not a surrender of power? The proposal for shared competences, of which the noble Lord, Lord Tomlinson, made such play, is a sham. The EU will have the absolute right, under the shared competences article, to legislate where and when it chooses. Member states can only pick up the crumbs. Under Article 17, the EU may, in order to attain its objectives, add to its powers over member states' elected governments by agreement with the Council of Ministers and the European Parliament. I underline the fact that, in doing that and extending its powers, the EU will not have to consult or refer to national parliaments; it can all be done under Article 17 in Brussels, between drinks and dinner—how very convenient. So much for returning powers to national parliaments.

    Above all, it is kind of dumb, even for someone who thinks that he saw Jackie Milburn play football for Newcastle, to pretend that, if we say "No" to the constitution, we will be cast into economic and social darkness. Britain has the fourth largest economy in the world; it has the best trained and largest army in the European Union: and it gives £11 billion a year to the European Union budget. We run a huge annual trade deficit with the European Union. In whose interests would it be to start a tariff war?

    No. my Lords, I believe that the British people will see the scare stories for what they are—kind of dumb—and will vote against the constitution when they get the chance.

    7.42 p.m.

    My Lords, it is always a great pleasure to follow the noble Lord, Lord Willoughby de Broke. Like him, I am grateful to the noble Baroness and the Government for allowing us a further debate on the constitution. I would be even more grateful to her, the Government and anybody else, if I believed that they would listen to anything that we said. Certainly, they did not listen to what we said in the Standing Committee—I attended every sitting, asked questions and spoke—and, when finished, the constitution was exactly the same as it was when we started. We had no effect, regardless of the effort that we put in in the Standing Committee.

    There have been changes in the Government's attitude, not only in the past few weeks but over the years since the constitution was first mooted at Nice. First, there was total opposition—Vaz and his "Beano" comment, for example. Then, we had total acceptance. We were told that the constitution was only a tidying-up operation, and we were derided by the noble Baroness—she admits it—for wanting a referendum on the constitution. Then, in a complete volte-face, a referendum was conceded. Those are the changes of policy that we have seen during the whole saga. I am coming to understand that we cannot believe anything that the Government say. Certainly, we can have no confidence in the Government's competence when they behave in that fashion.

    No sooner had the Government conceded a referendum on the existing constitution than the Irish Government came along with another big draft. The noble Lord, Lord Willoughby de Broke, has just referred to it and gave us some details. Having conceded that we will have a referendum, the Government must now examine a new draft from the Irish Government that, without any doubt, will increase the competences of the European Union at our expense. Yesterday's Guardian said:
    "Brown to demand 25 EU treaty changes".
    Could we know what they are, if that story is true? Will the noble Baroness tell us what changes Mr Brown would like to see made to the constitution before we agree to it? Will she give a guarantee that the so-called red lines will be maintained? They have not been in the past, and I hope that they will be on this occasion. In no circumstances should they be relaxed. Will the Government go even further to get powers returned and, as other noble Lords have asked, to get rid of the acquis communautaire and the 97,000 pages of legislation?

    Like the noble Lord, Lord Willoughby de Broke, and others, I was startled by the claim that Britain would be marginalised and sidelined if we did not sign up to the constitution. What sort of talk is that, from people who are supposed to lead the country? Why have they so little confidence in the ability of this country to succeed in the world without belonging to some regional bloc? We have done it for hundreds of years in the past. Why have our present leaders no confidence in the British people to stand their ground, not in a regional backwater but in the wide, wide world. After all, we are, geographically speaking, just about the centre of the world. As the noble Lord, Lord Willoughby de Broke, said, we are the fourth largest economy in the world. We have the Commonwealth. If we had only developed that, instead of stopping in the morass of Europe's back yard, this country would thrive.

    Then, of course, there is the other claim—the frightener—that, if we left the EU, 3 million jobs would he at stake. What nonsense that is. In the first place, we trade with the EU on a deficit of £5,000 million a year. EU countries would lose more jobs than we would, if they decided to put embargoes or restrictions on trade. They are not stupid; they will not do that, will they? In any event, they could not do so under international trade law. All that is a frightener.

    The Europhiles are always using it. They used in 1975, and they still think that they will frighten the people of this country.

    In any event, if it is all about trade, why do we need a European government, two presidents, a parliament, a bureaucracy, a currency, an army, a legal personality, a foreign minister, a supreme court, a public prosecutor, a flag, an anthem and a Europe day? Why do we need all of that to trade with them? We manage to trade with 172 other countries without all that paraphernalia. Indeed, all those other countries trade with Europe without all that paraphernalia. So it is nonsense, is it not? It is complete and utter nonsense that 3 million jobs are at stake. We have lost a lot of jobs in various industries. Our manufacturing industry has been hurt by our being members of the European Union. So I wish that the Government, and everyone else, would stop that.

    I do not know whether the BBC gets any grants from the European Commission, but its attitude to the European Union suggests that it does. Perhaps the noble Baroness can tell us whether it receives grants. At the weekend, the BBC wheeled out its resident Europhile—the noble Lord, Lord Heseltine, who I do not see in his place today to debate this matter. As usual, the BBC gave him twice as much coverage as it did to Mr Davidson who was putting the other point of view.

    Of course, last Friday, the noble Lord, Lord Heseltine, was also on "Question Time". As usual, there were three Europhiles and only one person from UKIP. That is the attitude of the BBC all along. It simply does not understand that there is a large body of opinion in this country that is not only opposed to this constitution, but would also like to withdraw from the European Union altogether. It really is about time that the BBC woke up to what the public want and to do its duty as a public corporation. It should give fair weather and fair coverage to all aspects of the argument.

    I hope that the BBC will do that as the referendum approaches, so that everyone will have a fair hearing. There should be no more breakfasts with the Europhiles, as in the 1975 referendum, so that it could sort out what lies it would tell during a particular day. Everyone knows my view of the European Union. We should never have got in. It is about time that we got out. I agree especially with the noble Lord, Lord Blackwell, when he said that to sign up to this constitution would be a disaster for this country. That is what we all want to avoid.

    7.52 p.m.

    My Lords, most of us may welcome the increased publicity and interest on this subject and the questions that these put. What is the purpose of a European Union of any size at any time? How should its larger affiliation be structured? I shall refer to three separate yet related forms of security and argue that their consistent interaction is what planning theory and practice should seek to achieve. First, there is defence security and the maintenance of peace in Europe, and thus also assistance to world peace. Secondly, there is political and economic delivery towards and within the European Union's nation states. Thirdly—not least—there is the competence and well-being of families and communities throughout European Union member states.

    No doubt the common factor among those three securities is economic stability. Certainly, for more than 50 years, it has proved to be the key to a successful European defence policy. The 1949 NATO Alliance could not have been formed had it not been preceded by the economic disbursement of Marshall aid in 1948. The Cold War would not have ended as it did in the 1980s had the arms race not come to exert an unacceptable level of pressure on the economies of the Soviet Union and Warsaw Pact states. What guidance therefore can be offered by the performance of NATO in Europe from 1949 until now?

    The two different periods to be looked at should be the Cold War until 1989 and the conflict within the former Yugoslavia between 1991 and 1999. NATO's strategy during the Cold War may have been both unusual and successful in three respects. First, unlike the League of Nations between the world wars, it demonstrated how human rights could be backed up by force, and thus how within an effective defence policy idealism and pragmatism can be conjoined. Secondly, unlike most other powers throughout history, it involved the building up of arms for peace and containment rather than for war and aggression. And, thirdly, as indicated, it involved the agenda or philosophy shared by NATO member states that democracy and human rights are best preserved and advanced through economic stability.

    NATO's mistakes during the conflict within the former Yugoslavia—in particular at the outset when it could have been controlled—are sometimes agreed, ironically enough, to have been a product of successful management during the Cold War. For 40 years, the focus had been on the containment of the Soviet Union and the Warsaw Pact states that formed its satellites. The control of regional instability had therefore not been a priority or even a necessity. As a result, NATO states distributed over the European Union, including the United States, were unused to confronting regional instability in the 1990s and were divided over and unsure of the best way to do so with regard to the former Yugoslavia.

    Does the Minister agree that the prescription for NATO and Europe may be fairly clear now? Any new systems for EU defence and foreign policy should not undermine or duplicate the role of NATO where NATO states are also members of the EU. Yet, if an EU foreign policy is to be any worth, and at the same time NATO is not to be undermined, how is that balance to be adequately guaranteed within a single treaty?

    My second theme is the desired aim of consistent political and economic delivery within the larger EU. No doubt a useful background to that is offered by the notion of subsidiarity. If that concept emphasises what national parliaments and executives together should deal with on their own, so that the EU in other respects can provide added value, it also implies a corollary. That is that through EU membership national parliaments should also aim to increase their influence over their own executives. Thus, in terms of subsidiarity, the wider EU ought to facilitate two beneficial and complementary impacts: the provision of added value without reducing national sovereignty and within nation states themselves the increase of parliamentary influence over executives.

    No doubt such aspirations are already matched by some of the draft proposals. These include a new role for national parliaments within the wider EU and encouragement to them to scrutinise proposed European Union legislation. However, as the noble Lords, Lord Grenfell and Lord Monson, have implied, those expedients may only produce much frustration if procedures between national parliaments, the Commission and the Council are not now further clarified in the first place. Does the Minister agree with this caveat? If so, what clear-cut practices for voting will the Government advocate to protect the role of national parliaments and to handle disagreements between them and the Commission?

    The third theme is confidence and well-being affecting families and communities throughout European member states. There is always a risk that within the new wider European Union, political and economic delivery will improve while the confidence of families and communities may not do so commensurately. Yet, this inconsistency, if it should obtain, might not so much reveal an obsession with material resources. Rather more, perhaps, it would reflect an ineptitude in handling them.

    Certainly, the stronger a central bureaucracy, the more likely it is that funds will be prescribed and allocated for spending in an inflexible way. Nevertheless, improved practice and benefit will often more assuredly derive from flexible initiatives and partnerships at local and national levels. Not least does the challenge to all Europe's communities come from the problem of young people and from those of them who, as a result of drugs, difficulties at home and with school learning, require to be deterred, guided and inspired into constructive purpose and away from crime.

    There is also the connection between well-being, cultural heritage and religion and the relevance of that connection to the wider Europe and its direction. Does the Minister agree that within current drafts this focus should be much more emphasised than it may have been hitherto? Does she also support the view, urged in a previous debate, that the preamble to the Convention should contain a general reference to God, as does the Polish constitution? It states,
    "both to those who believe in God as a source of truth, justice, goodness and beauty, as well as to those not sharing such faith but respecting those universal values".
    As today's debate has made plain, many of us have reservations about the current draft proposals. That apart, we should rejoice in what is now the reality of a wider Union and its triumph for peace, history and humanity.

    8 p.m.

    My Lords, we have had two parallel debates in the past three hours, one on the proposed revisions to the treaty and one on the myths of Europe as a threat to England, in which the monsters of the German, now the Franco-German, threat are conjured up and in which honest Englishmen are consistently in danger of being outwitted by wily continentals.

    The first debate is much more constructive and rational. It deals with practice and detail, and we need to take that further today and on later occasions. Sadly, however, it is necessary, as always, to wade through the second debate before we get there. Here there are horrors on our path and, as the noble Lord, Lord Pearson of Rannoch, put it, mortal threats to our democracy, from which the noble Lord would like, like a white knight, to "lead our nation back to freedom". We have to recognise that the nationalist tone of that narrative is a depiction of a lost world, an unchanging England, free Anglo-Saxons "girt by a silver sea". I recall that the Leader of the Official Opposition, Michael Howard, described the draft Constitutional Treaty as, "the greatest threat to the British constitution since the 17th century"—a wonderful overstatement, given that there was no British constitution until the end of the 17th century.

    All constitutions are imperfect. Much comparison has been made with the United States' constitution in this exercise and how wonderful it is, with its Bill of Rights, but no one quite mentions that, when written, the US constitution also entrenched slavery within the United States—not an entirely perfect document.

    We are asked to believe that the British constitution is desperately under threat. I would not go to the stake to defend the current British constitution. I certainly would not go to the stake over that aspect of the current British constitution that is the second Chamber, the form of which, after all, was initiated by a Liberal government in 1911 and, with luck, may possibly be completed by 2011. I would not want to go to the stake to defend the current House of Commons, either in its behaviour or its unrepresentative quality. We have to recognise the growth of popular disillusionment with the British constitution in this country.

    We have the most over-centralised system of government in the developed world. The noble Lord, Lord Howell, attacked the centralisers of Brussels. However, he was, of course, a member of the government who did much to impose that degree of centralisation on Britain. The Constitutional Treaty is an imperfect product of an imperfect, even if disappointing, convention. It is not unacceptable. It is a necessary compromise among member governments. I agree with the noble Lord, Lord Biffen, that it is not a horse, it is a camel. If I were walking a long distance and were offered a lift but discovered that it was to be a lift on a camel rather than a horse, I think I would get off.

    The character of international politics is, after all, one in which we have to work through multinational negotiation in a system of international organisations and international law. The depiction that the noble Lord, Lord Howell, gave us of a Britain being cowed by other governments—of us versus them and of foreigners conspiring against England—is not reflected in the way in which any British government have operated since the end of the Second World War. I recall with pleasure reading a number of articles over the years that the noble Lord, Lord Howell, has written about interdependence and globalisation. The Laeken declaration, which started off this convention, referred to,
    "the need effectively to deal with the challenges that globalisation and interdependence create"—
    more open borders, global economic integration, the communications revolution, the world population explosion with its consequence in international migration and cross-border crime, all of which require a higher degree of co-operation, shared rules, even integration, among governments who are affected.

    In Europe we live in a highly concentrated region. The whole of the European Union would fit into an area less than the United States east of the Mississippi, and that has consequences for the way in which we need to order our affairs. We no longer have a closed national economy and we no longer have an empire, even though I note that to the noble Lord, Lord Stoddart, that is a matter of great regret. We have achieved enlargement from—

    My Lords, I really do not know what grounds the noble Lord has for saying that. I referred to the fact that we had the Commonwealth, which is quite a different body from an empire.

    My Lords, I stand corrected. I am sure that the noble Lord gets on very well with Mr Mugabe.

    We have achieved the unification of the Continent, which is a massive achievement—25 member states, with some more to come, which gives us open borders and a free and united Europe, but that has certain consequences to which this treaty addresses itself. We have already transformed the European Union of 15. As I listened to some of today's speeches, I recalled having breakfast with a French official I have known for many years, who said, rather bitterly, that he felt that the old European community had now disappeared, that the Anglo-Saxons had taken over and were insisting on making sure that everything that was agreed was implemented throughout the European Union, and that he was not convinced that it was a good idea, and so forth. That is a very long way from the picture that is being presented to us.

    As I listened to some members of the Conservative Party, I was thinking about an article that I read last week in the Herald Tribune about what is happening to liberal republicans within the American Republican Party. Some are fading away while others find themselves sliding towards the populist and nationalist right. After all, American nationalism, which the new right in the Republican Party so clearly represents, is resistant to international law as such, to international courts in principle, and to all external and multilateral constraints. It insists that America is right and that everyone else is wrong, and holds particular anger against the French.

    English nationalism is directed at the European Union instead of the United Nations. I note from several speeches, including to my surprise that of the noble Lord, Lord Howell, that the European Court of Justice takes the place of the International Criminal Court and others as a particular threat to Englishness. I was even more puzzled to hear the noble Lord, Lord Howell, suggest in populist tones that political élites have led us to this. As a man of the people, a Texan Congressman may get away with attacking political élites in Washington more easily than Eton and Oxbridge scholars.

    The proposals in the treaty require some detailed discussion. Qualified majority voting is one of the great symbolic issues of this entire exercise. But we all know that very few votes are taken in Councils of Ministers. Most decisions are taken by consensus. I do not know how often the British Government have been outvoted over the past five years, but I understand that it has happened on very few occasions, and never on a major issue. Nevertheless, this is seen to be a great symbolic issue.

    I agree strongly with the noble Lord, Lord Hannay, on the lack of difference between the two different proposals for qualified majority voting on the table, but for the Spanish and for the Poles these are great symbolic issues of their standing within the European Union. Mrs Thatcher was persuaded by, among others, the noble Lord, Lord Williamson, to vote for the single European Act and thus a substantial extension of qualified majority voting because she recognised that as the European Community grew in numbers, so one did not want one awkward member state holding up the business that everyone else wanted to get on with. We have had that for a long time with France on the common agricultural policy. It was the behaviour of Greece during its first few years in the Community which was said to have most affected Mrs Thatcher. We have Malta, and we have Cyprus coining in. There are occasions when we want to move on by consensus rather than by absolute unanimity.

    The question of the yellow card and national parliaments is important. I am half persuaded by the argument of the noble Lord, Lord Grenfell, that it may be that the yellow card is sufficient and that we do not need the red card. That is one of the most important areas as we move towards a final treaty. However, let us recognise that this has implications for the way in which the British Parliament organises itself. I think that this Chamber has handled European scrutiny better than the other place, and that one matter that this Parliament as a whole needs to discuss is how we can improve our joint scrutiny to ensure that, whether it is a yellow card or a red card, it is operated effectively.

    The issue of subsidiarity also needs to be explored further. We need to think about the powers that are returned from the centre to national governments. Within the European convention there was an element, particularly some Members of the European Parliament, who still believe that the more that power is transferred from national governments to Brussels, the better things are. None of us here believes that and it is therefore very important to establish that powers can be returned from the centre to national governments.

    My Lords, I am sorry to interrupt the noble Lord. Can he give an example or make a suggestion, within any of the discussions on the draft treaty, or the meetings on the draft constitution, or even the Irish proposals, of a single power being returned to national parliaments?

    My Lords, I myself suggested during the Second Reading debate on the education Bill that we should ask in the treaty for a reversal of the decision of the European Court of Justice on the charging of university fees within the European Union. That seems to be a remarkable anomaly, not least because in the United States it is dealt with at state level.

    We need further to discuss the issue of the foreign Minister, which is a compromise, while recognising that how the new post of foreign Minister develops will depend a great deal on the personality of the individual chosen and on how he or she works with national governments. The same applies to the new proposal for a president of the Council, although I agree strongly with those who say that a rotating six-monthly presidency in a European Union of 25 nations—and in particular a representative of the presidency who sees it as his or her task to go around from capital to capital consulting with each national government on how best to build a consensus at the next European Council—has now gone beyond the capability of any active member of any national government.

    I am not entirely happy with what is being proposed about the future of the Commission. I am persuaded that we need an effective Commission, which means 15 or fewer commissioners. It is simply not manageable at present because each of the new member states thinks that it wants its own national commissioner. The myth of an all-powerful, malevolent Commission is one that we have to reject. In reality the Commission is weak and desperately in need of reform.

    The noble Lord, Lord Blackwell, was extremely clear about Article 3.3 because it is one of the underlying issues. Do we want a Europe with a market economy which has a social dimension, or do we prefer the American free market model? Many of those who have spoken in this debate against the treaty strongly prefer the American free market model. I simply remind them that 25 per cent of the American population do not have health insurance; child mortality is higher in the United States than in any country in Europe; life expectancy is lower than in Britain; and they have unsustainable economic development. I am not sure that the British people would actually prefer that model.

    My Lords, does the noble Lord accept that the question is not simply whether we prefer it but whether the British people should have the right to choose which economy they prefer at this time and at a point in the future rather than having it bound into a constitution?

    My Lords, that will very likely become one of the issues around which the referendum campaign will revolve.

    We will continue to debate this in the future; I must not detain your Lordships any longer. I simply say that this is not a perfect constitution, but it is an acceptable constitution. There is still room for negotiation. I hope that the Government will push for further clarification of where we are on subsidiarity but, in principle, I think that this is an acceptable approach.

    8.15 p.m.

    My Lords, I, too, am grateful to the noble Baroness, Lady Symons of Vernham Dean, for introducing this very important debate today so clearly. It is always a privilege to contribute to these impressive debates and to follow the noble Lord, Lord Wallace of Saltaire. I feel very humble replying from our side after such a long list of well informed, distinguished speakers, with understandably strong feelings and strongly held opinions.

    Today the European Union is undergoing still more important changes, as we have heard in the debate today. The central change, of course, is enlargement, which is very welcome and something for which we have always striven—indeed, it is very close to my own heart. It is an aim, as we heard from my noble friend Lord Howell of Guildford, in his eloquent opening speech, to which we attached great importance.

    Enlargement, however, carries with it a need to reform, as was pointed out by the noble Lord, Lord Williamson of Horton, and a need to change the way the European Union works if it is to function effectively in the 21st century and to compete energetically with other successful economies such as in the United States of America, Asia and, now, China.

    The exciting challenge of enlargement aside, the EU faces many ongoing problems to which several noble Lords referred: high social costs on business; overregulation; limited economic growth; and strains on the budget. Reforms in these areas, everyone recognises, are needed if the European Union is to succeed, prosper and reconnect with its peoples.

    A main objective, too, of the exercise was to shorten and simplify the treaties to make the EU more comprehensible and to bring it closer to the people. This fact was recognised at Laeken, from which all these proposals flowed. My noble friend Lord Brittan reminded us that with each enlargement, there has been more centralisation. It was interesting to hear from him how worried people were at the time of this enlargement that this would occur again.

    The debate in which we are engaged is of fundamental importance to the future of this country and to the direction of the European Union. I hope that the momentous nature of the changes going on in Europe will serve to focus voters' minds on the issue and that they will turn out and use their vote in the European parliamentary elections on 10 June. I am sure that the Minister, too, would encourage this.

    Let me turn briefly to the challenge from the noble Lord, Lord Tomlinson, to my noble friend Lord Howell of Guildford concerning new competences in the treaty. Page 18 of the report of the committee chaired by the noble Lord, Lord Grenfell, refers to many more than six competences. I shall not read them out at this late hour—they are all there for anyone to read. The report refers to new and extended competences.

    Several noble Lords pointed out that the response to the challenge posed at Laeken has been to produce a document, something which many noble Lords have made clear they believe to be unsuited to the real needs of an enlarged Europe, the needs of Europe as it stands or its citizens. My noble friend Lord Monson said that it fails to address the key issues.

    The noble Lords, Lord Tomlinson and Lord Maclennan, argued that the Constitutional Treaty is meant to be an agreement between nation states on how the European Union will be run. It confirms that the European Union is a union of nation states, each with their own elected government. And it confirms that the European Union is not a single state but an organisation of states that have decided to pool their sovereignty for shared benefits. We on these Benches welcome the Prime Minister's belated recognition that the Constitutional Treaty, when it is no longer in draft form, will be of such significance that the British people should decide on it. That is something for which the Conservative Party has long argued. Unfortunately, we fear that it was a U-turn not down to principle, but rather to an ad hoc political lurch.

    Many noble Lords have recognised that further change is needed to make the EU more flexible and more responsive with a simpler structure. However, as my noble friend Lord Blackwell reiterated, what the European Union does not need is a binding constitution which does far too little to simplify the treaties and which effectively creates a single legal personality for the European Union, representing a huge step change in our relationship and moving towards a more centralised Europe and a less competitive one as a result, and one we should not sign up to.

    My noble friend Lady Noakes raised the issue of taxation, which she is right to highlight so that it remains an area for member states to control. I am not sure that I can agree with my noble friend Lord Biffen who said in his stirring speech that the Single European Act should be reformed. It was always considered a Conservative success and one of Mrs Thatcher's, no less.

    Many noble Lords are worried about the increasing judicial control over domestic affairs via the charter of fundamental rights and a European foreign Minister, all of which the constitution seems to feel are desirable. While we believe in working together in areas such as defence and immigration, where there is voluntary acceptance of the need to do so and of the benefits of doing so, to make this compulsory and straitjacketed by bureaucracy would be counterproductive.

    We are all grateful to the noble Lord, Lord Grenfell, chairman of the European Union Committee, for the knowledge and expertise that he brings to this House. It was interesting to hear him stress how the Constitutional Treaty shifts considerable powers from the Commission to the Council of Ministers. That was reinforced by my noble friend Lord Brittan and the noble Lord, Lord Williamson of Horton. I remember the debate on the balance of power between these two bodies. It has been on the table for years. Several noble Lords were worried that, in essence, while we accept that Europe needs to change—

    My Lords, I am grateful to the noble Baroness for giving way. I did not use the word "considerable". I said "measurable". There is a slight difference.

    My Lords, I thank the noble Lord. Several noble Lords were worried that, in essence, while we accept that Europe needs to change, the constitution as it stands is not the answer, offering, as it does, outdated, bloc mentality-driven solutions to problems.

    In his forceful speech, my noble friend Lord Howell of Guildford pointed out that 25 diverse European nations can function effectively as a grouping only within a looser framework than is envisaged here. My noble friends Lord Willoughby de Broke and Lord Vinson and the noble Lord, Lord Stoddart, felt that freedom, stability and prosperity are what the people of Europe want from the European Union, not ever-greater centralisation.

    In the context of a referendum, as mentioned by my noble friend Lord Pearson of Rannoch, does the Minister not agree that it is vital that an informed debate takes place? Better to inform that debate, do the Government have any plans to provide detailed information on the articles of the final treaty and on their legal implications in an easily accessible format? In essence, will they produce a simple, fair guide with all substantive changes to the treaties that the constitution will bring about, as mentioned by the noble Lord, Lord Hannay?

    We look forward to the Minister's replies and are sure that all noble Lords would agree that it is virally important to have the clearest information and the most open—

    My Lords, I am most grateful to the noble Baroness for giving way. Can she confirm that the thrust of her remarks is that those on the Benches opposite will wait until they have seen it to make up their mind on the constitution, or will she associate herself with those many speakers who have already incited us to vote "no" before they have even seen the treaty?

    My Lords, I thank the noble Lord for that. I believe that we need to wait to see what the treaty says. I am sure that some people will feel that whatever it says will not be correct, but some people need to see a document and then they will decide.

    Noble Lords will agree that it is vitally important to have the clearest information and the most open debate on this most important of all subjects, which will affect all our futures.

    My Lords, the noble Baroness was kind enough to refer me not to anything in the draft convention but to page 18 of the report of the noble Lord, Lord Grenfell. I have had the opportunity to look at it. Will she accept from me that, far from being an answer to the question, it is another example of evasion? Perhaps she might choose to read through some of the articles that are listed, such as that on combating tax fraud and evasion or that on capital movements and combating organised crime, which are the first two on the list. Those are matters that the United Kingdom totally supports. They do not represent increases in competence but are now categorised as shared competences.

    My Lords, I was simply quoting from what is in front of me—some are shared and some are new competences, and some of the new competences are shared.

    My Lords, I am most obliged to the noble Baroness. She was interrupted by the noble Lord, Lord Hannay, who was I believe complaining that we were discussing something that we had not seen and that, in fact, we should wait until we saw the constitution. However, I point out to the noble Baroness that she is absolutely correct. We are not debating a future constitution; we have been debating a draft European constitution, which is all that we can talk about. Noble Lords and the noble Baroness have been perfectly in order in our discussions this afternoon.

    8.25 p.m.

    My Lords, I thank all noble Lords who have taken part in this debate this evening. Debates in your Lordships' House on the European Union and, more particularly, on the British place in the European Union, are always robust and always interesting. Today's has been no exception. Views as widely differing as those of the noble Lords, Lord Pearson of Rannoch and Lord Stoddart of Swindon, on the one hand, and the noble Lord, Lord Maclennan of Rogart, and my noble friend Lord Tomlinson on the other, illustrate that point very clearly.

    Unsurprisingly, I find myself certain that this country's place is at the heart of Europe and at the heart of the debate about the future of Europe. At the same time, I feel ever watchful about how that relationship develops, ever concerned about what powers belong here in this Parliament and what powers may properly be placed in the European Union.

    The noble Baroness, Lady Rawlings, was quite right: our starting point has been enlargement, and I know how firmly she has supported that enterprise. She is right, too, that the European Union's way of working should be clarified if a Union of 25 is to work well. Again unsurprisingly, I found myself more attuned to the well-honed arguments of the noble Lord, Lord Brittan of Spennithorne, who was right to remind us of the clarity of the constitution as it is spelt out in the draft treaty. He was right to remind us of the nature of the treaty, which he did with admirable clarity. He was right, too, to emphasise to us that although the failure to ratify the treaty would not mean leaving the European Union, it would be a very grave decision. I hope that we shall hear from the noble Lord more frequently in our forthcoming debates and that his party has the wisdom to listen to him.

    As the noble Lord, Lord Maclennan, said, much of the argument against the treaty rests on the claim that Europe is becoming a superstate—an argument espoused by the noble Lord, Lord Pearson of Rannoch. I emphatically disagree with that point of view. I would argue, as did the noble Lord, Lord Maclennan of Rogart, that the treaty provides more protection against a superstate than we have at present. It spells out that the EU is a union of nation states, and that it has only those powers that the member state governments have chosen to confer upon it, as the noble Lord, Lord Brittan, made clear. It proposes a new position for a full-time president of the European Council, which will mean greater accountability to national governments. I would argue that it strengthens the role of national parliaments in the Union by reinforcing the mechanism of subsidiarity. National parliaments will be able to examine legislative proposals from the very start of the legislative process.

    Some noble Lords have claimed that simply because the treaty is a constitutional treaty it must be rejected. There was a flavour of that argument in the contribution from the noble Lord, Lord Waddington. The treaty is neither a tidying up exercise, as some have described it, nor an end to our nationhood, as others would have us believe. It is neither negligible in its importance, nor is it the most important European treaty negotiated.

    The honour for the most significant shift in power from this country to Europe belongs to the party opposite. As the noble Lord, Lord Heseltine, has said, the Single European Act was far and away more significant in the surrender of British sovereignty than anything involved in the proposed constitution. As he pointed out, it never occurred to Mrs Thatcher, the then Prime Minister, to have a referendum. The noble Baroness. Lady Rawlings, has described it as a Conservative triumph, but it was not a triumph that the Conservative Party wanted to take to the country. That is an example of "Don't do what we did in government; do as we tell you now".

    I turn to the issue of a referendum. My noble friend Lord Tomlinson, and the noble Lord, Lord Hannay of Chiswick, disagreed with the Government's decision to go to a referendum on this issue, and I understand their concerns. I remind your Lordships that we shall have an opportunity for the cool-headed analysis for which the noble Lord, Lord Hannay, asked. Parliament's views will be debated fully and scrupulously. Perhaps I may quote the Leader of the Opposition on this point in an argument that he made on 21 May 1997. He said that the electorate,
    "should be asked for their opinion when all our questions have been answered, when all the details are known, when the legislation has been finally tempered and scrutinised in the House and when Parliament has debated and decided".—[Official Report, Commons, 21 May 1997; col. 735.]
    Hear. Hear—I agree. I want to make one matter clear to the noble Baroness, Lady Rawlings. It is not the legal or the constitutional argument that has persuaded me and others that a referendum is the right course, nor is it an argument that this treaty is more important constitutionally than the Single European Act or indeed the Maastricht Treaty. It is because the people of this country will have the opportunity to decide where they want Britain to stand in relation to Europe: at the heart of Europe where we have seen it for the past seven years, or with a considerable loss of influence as described by her noble friend Lord Brittan.

    Now our argument, at last, will be about the treaty itself; not about the process of taking that decision. I thank the noble Lord, Lord Blackwell, for recognising that important point. I agree with my noble friend Lord Tomlinson that some of the favourite arguments about the draft treaty have surfaced again today. The noble Lord, Lord Wallace of Saltaire, said that we have had two parallel debates, although the horse/ camel analogy of the noble Lord, Lord Biffen, set me wondering which animal goes further when circumstances are difficult.

    Many of the objections raised are not about the proposals in the draft treaty at all, but about today's status quo, a point made clearly by my noble friend Lord Tomlinson and by the noble Lord, Lord Williamson of Horton. They include the common foreign and security policy in the 1992 Treaty of Maastricht; the primacy of the European Court in the 1957 Treaty of Rome; and the European citizenship also in the Treaty of Maastricht.

    The same point was agreed in essence by the noble Lord. Lord Pearson, who was, as always, crystal clear. He dislikes this treaty. But more than that the noble Lord dislikes the current position, which he described as the betrayal of sovereignty over the past 32 years. Although less explicit on the point, the position of the noble Lord, Lord Blackwell, was similar, as was that of the noble Lord, Lord Vinson, and the noble Lord, Lord Willoughby de Broke. Theirs was a different argument from the main charge that came from the Conservative Benches, which was that the draft treaty is unprecedented in the powers that it cedes to Brussels. My argument is rather more on the side of my noble friend Lord Tomlinson.

    Let us think about the Single European Act. Among the articles it made subject to QMV was the free movement of workers, freedom of third-country nationals established in the community to provide services, guidelines and conditions for establishing the internal market, mutual recognition of national measures in areas affecting the internal market that had not been harmonised, and health and safety of workers.

    Let us turn to Maastricht, on which the then government refused to have a referendum. It created the European Union and declared that we were all citizens of that Union. It was Maastricht that created the common foreign and security policy, Maastricht that transferred 30 policy areas from unanimity to majority voting, including education, public health, consumer protection, development co-operation, transport, safety and many other areas. That treaty gave the EU new powers in justice and home affairs issues for the first time and it was that treaty that established a single European currency. So the description given by the noble Lord, Lord Pearson of Rannoch, of what happened before 1997 is not so wide of the mark in terms of the competencies of the EU. But, as always, our approach to the extension of QMV and—

    My Lords, I want to help the Minister on this. She has talked about the Single European Act. She will, of course, recall that the Labour Party, then in opposition, opposed it. Indeed, I stood at the Dispatch Box on the other side of the House, together with my noble friend Lord Bruce of Donington, opposing it as well. The difference is that the Labour Party and the noble Baroness have changed their minds; my position remain exactly as it was then.

    My Lords, the noble Lord will recall that it was the Labour Party that had the referendum in 1975. My point was that it is the party opposite that has made these extraordinary changes in the relationship between this country and the European Union, and that was where I agreed with the noble Lord, Lord Pearson of Rannoch.

    As always, our approach to the extension of QMV and co-decision will be to agree where it is in Britain's interest but not to do so in areas where our vital national interest dictates otherwise. The noble Lord, Lord Wallace of Saltaire, was quite right. We are rarely outvoted on QMV: twice in 2001 and once in 2002. Without it, we could not have constructed the single market or made progress on reform of the common agricultural policy. We therefore welcome the use of QMV as the general rule for legislative proposals.

    Of course, the noble Lord, Lord Pearson of Rannoch, differed from his noble friend Lord Waddington, who thought that there were some unprecedented parts in this draft treaty. He cited the primacy of EU law, but that primacy is well-established, at least since 1964 when the European Court of Justice ruled in the case of Costa v Enel.

    My Lords, the Minister has misunderstood me. I made the point that the primacy of the law was indeed established way back in 1972. My point was that this is a unique beast, a constitution. That is the point I was making.

    My Lords, I would contend that the point that the noble Lord made was indeed about the primacy of law, but he seemed to distinguish in his mind between the primacy of law and the constitutional impact of the primacy of law. I do not believe that that is a tenable distinction. Let me quote to the noble Lord from that judgment:

    "The transfer by the States from their domestic legal systems to the Community legal system of the rights and obligations arising under the Treaty carries with it a permanent limitation of their sovereign rights, against which a subsequent unilateral act incompatible with the concept of the Community cannot prevail".
    That is a constitutional point. I understood the point that the noble Lord, Lord Waddington, put but what I am saying to him is that I do not understand how he can distinguish between the primacy of the law and that not impacting on the constitutional position. Maybe that is a point that we can debate later.

    My Lords, I am sorry to intervene but we must get these matters accurate and on the record. I am afraid that both my noble friend and the Minister are wrong. The German Federal Constitutional Court ruled in 1993 that competence resided with it and not with the European Court of Justice. That was the position and remains the position until we have this new constitution which will remove the power to question the matter and set a constitutional seal on all the law-making powers of the ECJ. That is the change. The Minister must understand that.

    Baroness Symons of Vernham Dean