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European Union (Amendment) Bill

Volume 701: debated on Monday 12 May 2008

House again in Committee on Clause 2.

40: Clause 2, page 1, line 12, after “excluding” insert—

“(i) Article 2, paragraph 48, amended Article 36 TEU (TFEU), first paragraph, the words “European Parliament and”;(ii) Article 2, paragraph 49(c), amended Article 37 TEC (TFEU), new paragraph 2, first sentence, the words “The European Parliament and” and the words “, acting in accordance with the ordinary legislative procedure and”; and(iii) ”

The noble Lord said: Amendment No. 40 is in my noble friend’s name. I will also speak to Amendments No. 41 and 41A. I ask noble Lords to note that I am actively engaged in my family’s agricultural and horticultural business and, as such, I must declare an interest.

The Lisbon treaty and the new constitutional settlement—that is what it represents, notwithstanding the semantics of the Government’s position—have relatively little to say on the detail of the common agricultural policy. This is probably just as well—noble Lords have enough to give them concern with the Bill as it is.

However, it is a matter of European Union history that, other than the European Coal and Steel Community, the common agricultural policy is the longest living relic of the idealism of those early days. It would greatly extend the nature of this debate to decide whether in the 1066 and All That version of history it has been a good thing or a bad thing. It has certainly presided over a period of considerable change—both structural and technical—and, up to now, provided the countryside with some economic security and the consumer with good-quality food at reasonable prices.

However, things are changing fast and I am far from sure that politicians are changing fast enough. Almost certainly, Europe’s common agricultural policy is too inflexible and hidebound in national self-interest to change fast enough. What have the Government been doing to force the pace of change? For what reason did we give up our rebate? It was in direct return for reform of common agricultural policy. Where is that reform? I have no doubt that the Minister will refer to the health check, but Miss Mariann Fischer Boel, the Agriculture Commissioner, expressly stated that it is not reform.

The Government know that the enemies of CAP reform are deeply entrenched in Europe. How do they explain their weakness in confronting the opponents of change? Will the noble Lord give any assurances of worth in this area when it is clear that the French have dominated the agenda in agricultural affairs since the founding of the policy?

Recent changes in market conditions have alerted all and alarmed some. They are not brought about by poor harvests alone but are also consequent on demand-led changes—global economic changes and the new demands of renewable energy and biofuels. All this has led to a realisation that all is not well in the world of the common agricultural policy. Stuck as it is in the political philosophies which gave it birth, it is overcentralised, overbureaucratic, inflexible and wasteful. The current health check is a long overdue investigation into where this policy is leading.

It was originally envisaged that the CAP would support the interests of farmers and the rural community and, at the same time, look after consumer interests, but it is in danger of doing neither. It has become the creature of national Governments operating in their own self-interests and the victim of the trade-off policies which, more than anything, have destroyed the idealism that lay behind the formation of the European Community, now the European Union.

Much will hang on the health check, the draft report of which is due next week. It would be useful for noble Lords to know—the Minister might assure the House—that the draft report will be debated here and that nothing in the Bill impedes such reform as may emerge.

Amendment No. 40 is designed to resist moves to weaken control of national Governments over important framework laws governing the CAP and the CFP. The Committee will know that many reforms have been suffocated by the inability of European institutions such as the European Parliament to come to grips with change. It has consistently opposed reforms such as those affecting the wine industry or increased modulation—that is, the transfer of budgets—whereas this country and Portugal have been alone in initiating them on a voluntary basis. Indeed, the Parliament has vouched to lock many of its current policies after 2013. Amendment No. 40 is designed to exclude co-decision-making powers from the European Parliament, for it can be easily seen that it is likely to become a roadblock to reform and a second line of defence for protectionists.

This is not assisted by the treaty, which, as my noble friend the Duke of Montrose pointed out on a previous amendment, gives the Community exclusive competence on the marine environment. It is true, as the noble Lord, Lord Pearson of Rannoch, has pointed out, that the definition of agriculture includes fishing. Additionally, “agricultural products” means the products of the soil, livestock farming and fisheries and covers the first-stage processing of all these products. Amendment No. 41 seeks to challenge the treaty in seeking such competency.

We can have no doubt, therefore, that Europe intends to maintain and extend control over these matters. Already overregulated, we should note that the Commission may also authorise other measures, the conditions and detail of which it shall determine. What role for Defra when the statutory instruments arrive by first-class post from Brussels?

Amendment No. 41A seeks to make sure that Parliament here in Westminster still retains a role in the development of the CAP. I hope the Minister is able to reassure the Committee that this will be the case should the Lisbon treaty be ratified. I remember assurances that the whole purpose of the treaty was to engage national parliaments in co-decision-making. Perhaps I have misinterpreted this proposal. It is certainly important to know that CAP reform would involve a role for Westminster.

Perhaps I may conclude by making a particular observation. The Lisbon treaty makes provision for the common organisation of agricultural markets in one of the following forms: common competition rules, compulsory co-ordination of national market organisation or a European market organisation—different structures for different products. It is not difficult to see that this could lead to a considerable tightening of the interference and control in the marketplace. I am minded that the drafters of such proposals need a seminar on the operation of the market from the noble Lord, Lord Jones of Birmingham, who, although not in his place, instructs the House as a Minister on this subject regularly and to good effect. Regulation and control have no relevance for a world which has become anxious about food security and where land-use prioritisation, following the development of biofuels, is creating powerful pressures to increase capacity.

The Government have presented us with a Bill which they say is designed to set the pattern for the future of the Union. The reality is that it avoids issues such as the CAP, or where it includes them does so in such a way that it makes them irrelevant to the greater challenges facing Europe’s farmers and the anxieties of Europe’s citizens. Our amendments recognise this. I beg to move.

I warmly support the amendment so ably moved by the noble Lord, Lord Taylor. He is suffering from a slight attack of hopefulness after dinner because, no matter which colour they are, all British Governments have suffered from delusions over the common agricultural policy and its reform. All British Governments have argued for reform but, I am afraid, have never got anywhere.

The CAP still consumes some 45 per cent of the total EU budget, to which we contribute disproportionately. Our last shot at reform was during the EU presidency when the then Prime Minister, Tony Blair, agreed to give up quite a lot of our hard won rebate in return for reform of the CAP. Of course the reform just turned into a “health check”. Our partners in Europe must have had their fingers crossed. The health check consists at the moment of: “Let us see the colour of British taxpayers’ money. Yes, that is okay; they are still paying a whole lot of money. What about French agriculture? Open wide. Yes, that is all in perfect working order as well. Health check complete”. We are still paying and the French agriculture sector is still receiving. The result is that British taxpayers are still shelling out enormous amounts of money, still shovelling billions a year into the EU budget that is so riddled with fraud and irregularities that its accounts have not been signed off by its own auditors for 13 years. That looks like another classical government winner on the lines of Gordon Brown’s sale of gold at the lowest point in the market for 100 years.

The French are a little bit more rational about this sort of thing—or self-interested, depending on your point of view. The French Minister Michel Barnier is on record as opposing any reform to the CAP. Using food security as an excuse for more protectionism, he has gone as far as suggesting—I think I saw this in the Financial Times—that the CAP should be taken out of the Doha round of the WTO talks. He is on record as saying that the CAP is a good model and that the CAP should return to its food production subsidies. Do the Government agree with Mr Barnier or do they think that the N in his name should be replaced with an M and agree that it is absolutely barking mad to spend 45 per cent of the EU budget on the 5 per cent of the population that produces 3 per cent of the EU output? I should like some idea of whether the Government think it is still a very good idea to spend this sort of money.

The noble Lord, Lord Taylor, asked where the Government are on all this. I have news for him—the debate is going on without us. A report in the Times on 26 April noted that Germany is backing French proposals to maintain direct agricultural subsidies after 2013, which is when Britain and some other more market-minded EU member states want total reform of the CAP. The German Minister of Agriculture, Herr Seehofer, said:

“Food security is a demand of our population”.

He did not see how this could be done,

“by taking away subsidies from European farmers”.

Absolutely no surprise, then, that Germany has joined France in opposing the concessions on farm subsidies that Mr Peter Mandelson, our very own Trade Commissioner, is proposing to make at the Doha round. That is now being opposed by the French and German Governments. I do not know whether the British Government are in a strong position to argue that one through and get their way.

The French press agency, AFP, tells us that Berlin and Paris are ready to join forces in opposing British attempts to reform the CAP. This is welcomed by a spokesman for the European Commission, who said:

“When the French and the Germans talk on European issues and European interests, it is always good for Europe”.

Note that they did not say that it is always good for Britain. For those self-deluding British politicians who for years have been telling us that Europe is going our way, this must be something of a wake-up call. This is state intervention and state protectionism all rolled into one—these so-called reforms of the CAP which are being opposed by France and Germany, which have always called the shots. But this is the CAP, invented as a conduit for pouring money into French agriculture. It is entirely predictable that the Franco-German motor is exploiting a perceived food shortage to continue to advance an agenda which has existed for decades and which shows no signs of running out of energy or of money, even if it is our money.

These are the CAP chickens coming home to roost at last. Successive Governments have handed over our agricultural, farming and food policies to the European Union. We are now at the mercy of the Commission, the European Parliament—if this treaty goes through—and the Council of Ministers.

I speak now not as a swivel-eyed Europhobe but as an advocate for the Government’s position, as I understand it from today’s Financial Times, which says that the Chancellor, Alistair Darling, wants to scrap EU external tariffs, which inflate prices for commodities such as beef and dairy products, and end all direct payments to farmers. The FT quotes him as saying:

“It is unacceptable that, at a time of significant food price inflation, the EU continues to apply very high import tariffs to many agricultural commodities”.

Mr Darling is right in saying that, but it does not end there. He goes on to say that the CAP costs consumers in Europe billions of pounds a year in higher food bills while hurting farmers in the developing world. The German Agriculture Minister has dismissed that as “complete rubbish”. Do the Government agree with Mr Darling, the Chancellor, or with the German Agriculture Minister that the reforms of the CAP that Mr Darling is proposing are complete rubbish?

The amendment is sensible. It is crazy that the Government can support the idea of giving the European Parliament, which is currently mired in sleaze—brilliantly exposed by the Liberal Democrat MEP Chris Davies, and I am still waiting for a tribute from the Liberal Democrat Front Benches to his energy and bravery in exposing that corruption—any role at all in a co-decision on the CAP. It has historically been against reform, as the noble Lord, Lord Taylor, said, and has blocked it, so to allow this to go through would be completely crazy.

This is a classic argument for getting out of the mess of the EU. We are never going to get anywhere on agricultural reform while we remain bound to the ruinous, discredited policies of the CAP.

I warmly welcome the thanks of the noble Lord, Lord Willoughby de Broke, to Chris Davies, who is indeed doing important work on the way that expenses work in the European Parliament, much as many of my honourable friends are doing in the House of Commons. The expenses regime in the European Parliament, as in the House of Commons, needs to be changed and made transparent; I agree with the noble Lord on that. I was with Chris Davies MEP at the end of last week and congratulated him on his good work.

We agree on all sides of the Committee that there needs to be continued reform of the common agricultural policy. As the noble Lord has said, the Government themselves have a fairly radical agenda in that area. It would be useful, though, if we got some of the historical facts and the context right at the same time. First, the common agricultural policy is, wrongly, a huge proportion of the total EU budget. It has gone down—currently it is around 40 per cent—but it is important to remember that the EU budget is something like 1 per cent of the total EU GDP, which makes agricultural support throughout Europe from all nation states something like 0.5 per cent of GDP. That is probably significantly less than in some areas of industry where the single market, competition policy and state subsidy have not worked well enough.

I agree with a number of the criticisms that the Conservative Front Bench made of the single market and its inability to complete the process that started some time ago. That needs to continue. We have to accept that if we are in a single market for agricultural produce, the last thing that I would want for farmers in my area, the south-west, is greater inequality in subsidy between agricultural regimes. Within a single market it is quite clear that states such as France and new states in eastern Europe would subsidise agriculture far more than any UK Government ever would. That would be to the direct detriment of British farmers.

There is another area, which we have to put in some context. All of us would probably agree that the reforms of the CAP have not gone far enough, but let us not mistake the fact that the changes that happened through Agenda 2000—and all the other changes that took place when the current policy came in, in the early 2000s—were major changes. The European Union has moved substantially away from production subsidies, to other areas in terms of environmental cross-compliance and rural policy. All of us, particularly on these Benches, would agree that that process has not gone far enough, but to say that there has been no reform of the common agricultural policy would be absolutely wrong. What we do not have now, in terms of the food security issue, are grain mountains and butter mountains. With the change of the Common Market organisation on wine, a number of those areas are changing as well. Do they go far enough? No, they absolutely do not. I think we would all agree with that. While there is a single market, and some payment to farmers, I would be interested to know if other political parties are advocating a total free market in agriculture, with no subsidies whatever. If that is the case, they should make that very clear in their manifestos at the next general election, whenever that is.

I am particularly struck by the Conservative Front Bench view on the involvement of Parliament in the common agricultural policy. From the standpoint of the noble Lord, Lord Willoughby de Broke, the European Parliament is probably an institution beyond redemption because of corruption, so he would have a valid argument. I cannot understand why any party that fundamentally agrees with democratic accountability would not agree that something as central to the European Union—outside the areas that are always exclusive for policy, such as defence and foreign policy—should not be part of the European Parliament’s serious responsibility. That denies democratic accountability; it denies the fact that there is no taxation, or expenditure of tax by budgets and institutional budgets, without democratic accountability. I cannot see how you get away from that.

The noble Lord may have made a small mistake; he may have confused me with a Member on the Conservative Benches. Of course, I am not. I am UKIP. The noble Lord, Lord Lamont, has asked me to make that clear, which I do with great pleasure. Secondly, I do not see why the European Parliament should have a role at all in democratic accountability. It is not its money. It is our money that is being disposed of, so cavalierly, by the Commission and, under these proposals in the treaty, by the European Parliament. The European Parliament has nothing to do with it at all.

I agree absolutely with the noble Lord about that: taxpayers’ money is exactly that. It is taxpayers’ money, whether it is that of the Exchequer within the United Kingdom, or at the discretion of the Scottish Parliament or that of the European Parliament and European institutions. Clearly, the money comes from us as individuals, whether as businesses or other legal entities. I think that we agree on that. It is true at UK Parliament level and at European Parliament level.

I believe strongly that there needs to be democratic accountability at European level. The European Parliament is a great institution. It is not a perfect institution by a long way, as the noble Lord said. During my time as an MEP, I remember that the noble Lord, Lord Tomlinson, was one of the most effective MEPs, especially with regard to the Committee on Budgetary Control, calling to account the expenditure that we are discussing. It is absolutely wrong that some 40 per cent of the European budget is not fully accountable to the European Parliament. That will change under the treaty of Lisbon.

There is a real issue about the agriculture committee, which is chaired by a Conservative Member of the European Parliament, Neil Parish, and any criticism of that committee must reflect on him. If you do not give a committee of a Parliament any real power, you should not expect it to attract the most competent MEPs. It will not exercise authority because it does not have great authority. The same is true of the committee on fisheries, of which I was a member. Perhaps I was not the right person to undertake that task. We need democratic accountability. It is not just about committees driving decisions. All committee decisions on legislation, and certainly on budgetary matters, are examined in different areas but all come before the Parliament. I do not believe that the European Parliament holds the agriculture interest groups in particularly special regard. This change in the way in which Europe works will result in greater democratic accountability and greater accountability of the agriculture budget.

As I said on Second Reading, if any European Union institution acts behind closed doors and in a non-transparent way, which is to be changed under this treaty, it is the Council of Ministers, where even in legislative session deals can be done that are not made public. That will change and this whole area of agriculture and fisheries will become far more transparent and accountable. Better decisions will be made. It may take time but I am sure that these bodies will become far more democratically accountable than they are at present.

It is a great pleasure to follow the noble Lord, Lord Teverson, to whom I am grateful for his generous personal remarks. He explained the policy areas in the CAP extremely well. I merely emphasise one of his challenges. The Opposition criticise this area, but are they in favour of a complete free market in agriculture or do they see any role for subsidies? If they are in favour of subsidies, should they all be done at the national level or is there room for a European Union subsidy, albeit of a different nature to what we have today? The one thing that is absolutely clear—

No. I listened with great patience to the noble Lord and I shall not give way at the moment. I have hardly said a thing and I am not giving way. This is far too frequently being turned into a dialogue involving only whichever UKIP Member happens to be walking around, leaping up and thinking that he has inquisitorial rights in the Committee. I am not prepared to concede to them.

The point that I was trying to make is that nobody in this House defends the CAP as it stands. It is clearly not a sensible mechanism with which to organise European agriculture. It was a sensible mechanism in the days when the treaty of Rome was written, when the greatest geopolitical problem that Europe had was the security of its food supplies. As we moved towards self-sufficiency commodity by commodity and failed to change the CAP, it became a less and less relevant way of organising European agriculture.

However, whether we should support the CAP today is not the question in the amendments. The most important question being raised in the amendments is whether there should be a role for the European Parliament. One of the important things that the treaty of Lisbon does is abolish the distinction between compulsory and non-compulsory expenditure. As soon as that happens, for the first time ever a real power is being given to the European Parliament, which has been able to indulge in every sort of unaccountable nonsense discussion because it had no power whatever over non-compulsory expenditure. In the debate so far, we have failed to realise that the people who have had the exclusive priority of determining agricultural policy—the Council of Ministers—have made a mess of it and have largely to be held to account by a European Parliament that will have equal say over the distribution of agricultural expenditure.

The CAP is not supported by anyone. It needs to be reformed. I believe that the engagement of the European Parliament through the abolition of the distinction between compulsory and non-compulsory expenditure will be the greatest impetus for change that we have before us. In those circumstances, for noble Lords to describe the European Parliament as the last bastion resisting reform—or, as one noble Lord said, as totally against reform—is a caricature of the reality. Once the distinction between compulsory and non-compulsory expenditure is abolished, the European Parliament will see agriculture in contraposition to all the priorities that it espouses—environmental policy, social policy, regional policy and so on—and on which it has been pressing for greater expenditure. It will realise that, with a capped budget, the only way in which it can gain more expenditure on social policy, on common foreign and security policy and on regional policy is by making sure that it exercises its responsibility for adequate controls on agricultural expenditure. That policy will be the driving motor for the necessary change in that area.

I, too, would not wish to see the words “European Parliament and” excluded from the Bill as proposed in Amendment No. 40. I take the view that the European Parliament’s intervention in agricultural matters as a result of changes in the budget system that give it some real power that it did not have before is likely to be positive for changes in the agricultural policy of the Union. I do not take the view that the European Parliament is a wholly conservative body that wishes to retain exactly what we have now. The facility to move money between one part of the budget and another will be an important element of the way in which the European Parliament looks at agriculture.

We are out of date in looking at the Parliament as a body that will retain the agricultural policy exactly as it is now. I attended more than 100 meetings of the Agriculture Council and eight marathons normally lasting two or three days and nights and I am still here, but not much change was made in the common agricultural policy in consequence. I would have expected to have a bigger change as a result of parliamentary input. We are out of date and we should welcome parliamentary input.

Finally, it is important while criticising the agricultural policy, as many of us do, to be realistic about one or two of the changes that have been made. There is quite an important change in the agricultural policy, in that it was a market intervention mechanism practically across the board, which pushed up prices to consumers. That happened over many years. That element has practically vanished. If you look at the accounts now, you will see that the amount of money devoted to intervention in the market is extremely low and that there is little intervention in the market.

The gainers are the consumers, who are not penalised as they were in the past by elements of the common agricultural policy. I attach a lot of importance to that; I think that it is just as important as the argument about taxpayers’ money. They are both important points. There is still a heavy amount of taxpayers’ money being put into agriculture—in my view, too much—but the intervention in the market has been sharply reduced compared to the situation before the changes were made. We should recognise that, because it is an important element for our consumers and for others in the European Union.

The noble Lord, Lord Teverson, challenged the Conservative Party—and others, presumably—to say whether it wants a free market in agricultural products. I think that New Zealand went for a free market in agricultural products and made a great success of it. It may very well be that that is another policy that the Conservative Party will put forward before an election before the Labour Party gets hold of it. As I shall show in a moment when I quote further from today’s report in the Financial Times, the Government seem to be moving in a direction that many of us over many years have urged them to do, although so far they have not gone our way.

The CAP has undoubtedly been a disaster overall. I remember when we were fighting those battles long ago about whether we should join the Common Market that the people who were most in favour of our joining were the farmers. They were in the vanguard. The NFU was a government supporter and helped the Government to persuade farmers, who were much more important then in our economy than they are now, that they should go in. By heaven, a lot of them now regret that decision, because since we joined the common agricultural policy about 500,000 farmers have left the farms and our agricultural production is not what it was. It has been a disaster in other ways as well. The Treasury tells us that the CAP costs every family in this country £18 a week more in food costs than they would need to spend if we were not in the CAP.

I am grateful to the noble Lord for giving way. I have slightly lost my place in the groupings list; I am a little unclear which amendment he is speaking to. Could he perhaps say? I am not aware that the treaty of Lisbon establishes the common agricultural policy.

The one good thing about the Lisbon treaty is that it gives us an opportunity to talk about important things that perhaps we do not tackle too often in our debates. The amendments refer to agriculture and the role that the European Parliament might have in the future, so we are perfectly entitled to discuss it.

We have had many good speeches and the European Parliament has been ably defended by two former Members of that body, but I wonder whether it is worth defending. I refer to the article in the FT today. I have been itching to find something with which to support the Government and this article gives me the opportunity. I will quote three paragraphs. The headline is, “Chancellor fires blast at EU’s farm policy”. The article says:

“The chancellor will urge fellow European Union finance ministers to support the dismantling of the CAP, saying it is costing EU consumers billions of pounds a year in higher food bills, while hurting farmers in the developing world.

In a strongly worded letter, Mr Darling calls current EU farm policies ‘unacceptable’. He urges an end to direct support for European farmers and all measures that keep farm prices above world market levels.

The chancellor also repeats Britain’s insistence that Europe must review its target to increase the use of biofuels to 10 per cent of fuel use. He believes that this could be forcing up food prices in developing nations”.

That is one of the best condemnations of the CAP that I have heard for a long time—and hooray for that. It would appear from what the Chancellor is recommending to his European colleagues that he, too, believes in a free market in agriculture. We are moving together. The Chancellor of the Exchequer, who should know what he is talking about and in my view does, is talking sound sense that many of us agree with—including some on the Liberal Democrat Benches, who are very well disposed to the European Union. It seems that all sides are coming together to the view that the CAP is a ruinous policy—for Governments, for people and for the developing world. We are coming together in the hope that we can get rid of this absurd policy and find a market solution to the agricultural problems that we have, and to the food shortages and price increases that we will face in future, which cannot be found as long as we have the CAP.

I also support these amendments, because it does not seem possible that the European Parliament will do anything to improve the common agricultural policy. It is too firmly engaged on the European gravy train to upset its direction and jeopardise the comforts that it enjoys from it.

Noble Lords may have noticed a quotation in the Times on 21 April, from an unnamed British diplomat who is supposed to be close to these matters in Brussels. He said:

“You cannot spend 45 per cent of the EU budget on 5 per cent of the population who produce 3 per cent of the EU’s output”.

Economically, as other noble Lords have said, the CAP is madness. The Government have said that it costs the average British family about £1,000 a year in higher food costs. We should not forget that those higher food costs come through the increased price of milk, sugar and bread, and hit the poorest hardest.

However, it is beyond our shores that the CAP must be held to account. If we are to believe the Trade Justice Movement, CAFOD and Oxfam, the common agricultural policy has been killing untold numbers of people in the developing world, mostly children, by dumping its unwanted produce on those impoverished people, because they cannot sell their products in their local markets. I have a question for the Minister: have Her Majesty's Government made any estimate of the extent of this suffering? What is the number of people who have been affected in this way in recent years? I accept that US grain subsidies and grain exports compound the problem, but we are responsible for the common agricultural policy, because we are part of the European Union and, therefore, we support that policy.

Then of course biofuels come on top of all this. They are perhaps not strictly part of the common agricultural policy, but the EU, in its absurd quest for environmental change and altering our carbon footprint in the useless pursuit of affecting global warming, is clearly proposing to use land that would be better used for growing food. I say “useless”, because we now know that the planet is cooling down, and will be for at least the next 12 years—maybe the next 50 years. I pray in aid the Hadley curve. Anyway, we are not talking about that now.

Well, we have just had the coldest winter in the northern hemisphere since records began. We are told by the global warming enthusiasts that it is just an aberration and that it proves their point and their theory, but of course it does not. Time will tell, but simply to laugh off the idea that global warming may have ceased or be on the retreat is perhaps a little arrogant of noble Lords, from whom I would have expected better.

I have another question for the Minister. Can he tell us of another industry that is paid for doing nothing, apart from many of the non-productive employees in our state sector? What other industry is paid this sort of money to do nothing, through set-aside and the single farm premium payment, while doing such colossal environmental damage? I would be grateful if the government Front Bench could come up with an answer.

I come to the noble Lord, Lord Teverson, who admits that we need continued reform of the CAP. As my noble friend Lord Willoughby de Broke points out, Europhiles and British Governments have been saying that for years, but nothing has happened. Does the noble Lord, Lord Tomlinson, wish to say something from a sedentary position? No, he does not.

I am very glad that the noble Lord is spellbound, but I very much hope that his Government will, on his behalf, be able to answer the questions that he does not face. I ask the noble Lord, Lord Bach, to answer the same question in relation to the common agricultural policy that I asked on the common fisheries policy, which he did not answer. Why can this wicked policy not be changed? What is happening in Brussels with the common fisheries policy and this policy? Which countries are holding up that change? Such discussions may well be secret in the enclaves and procedures of Brussels, but it would be helpful to the British people if they knew why this policy could not be changed.

The noble Lord, Lord Tomlinson, said that the European Parliament would be immensely helpful in this regard—I maintain that it will not—and that the Council of Ministers had made a mess of this over the years. But, surely, if change were to come, it would have to be proposed by the Commission in secret. It would have to be negotiated in COREPER and then passed by the Council. The noble Lord, Lord Tomlinson, shakes his head but I have to ask him whether that procedure occurred with proposed reform of either the common fisheries policy or the common agricultural policy. I suggest that it has not.

The position of the UK Independence Party is that if we left the European Union, which we should do, we would run our own agriculture to suit ourselves and stop being part of this evil on the face of the planet. I simply ask: how dare the European Union propose to lead the way on environmental policy for the good of the planet when it has been responsible for this for so many years—and why can it not be abolished?

I am grateful to the noble Lord for moving his amendment and speaking to the other two.

Amendments Nos. 40 and 41 refer to the extension of codecision to certain aspects of agriculture and fisheries policy-making. The ordinary legislative procedure—qualified majority voting and codecision—will now be the default decision-making procedure for agriculture and fisheries matters, as it has been for the environment for some time. Agriculture and fisheries policy is already subject, as the Committee will be aware, to qualified majority voting. However, the Lisbon treaty introduces codecision to this area involving the European Parliament.

We have to decide where we stand on that. We believe that the European Parliament fulfils a vital role in the European Union. Its Members are directly elected, perform a very important role of scrutiny and hold the Commission to account. Even those who are sceptical about the role of the Parliament should be grateful for that because they are even more sceptical about the role of the Commission. MEPs are increasingly effective, both at raising issues of key concern—for example, climate change in recent times—and at scrutinising and improving legislation.

Strengthening the European Parliament’s role increases transparency and democratic accountability. Our EU Select Committee report noted in paragraph 10.36 in relation to moving to co-decision on agriculture and fisheries that:

“It will bring more transparency and accountability to the policy-making process, allowing third parties to raise concerns more easily with policy makers and facilitating national parliamentary scrutiny”.

Experience in areas already subject to codecision—I have mentioned environmental policy already—has shown that proposals can be improved by the involvement of MEPs. The additional scrutiny and debate in the European Parliament will offer new opportunities for us and other member states to secure, frankly, better regulation.

If I may walk down memory lane for a brief moment, in a previous role as a Defra Minister I saw for myself the valuable input that can be given on legislation by the European Parliament. There are people in Committee tonight who will well remember REACH, which implements a new EU regime for regulating the risks to human health and the environment from hazardous chemicals. That was greatly improved through the interplay between the Council and the Parliament.

Thanks in part to co-decision, the final REACH proposal was more in line with the principles of better regulation and provided higher protection against the most harmful chemicals. The procedure also provided greater opportunity for scrutiny and a wider debate than would have taken place between industry and the interest groups involved. We as a country have a lot of experience of dealing with the European Parliament and will certainly draw on that—and, indeed, on what we consider our good reputation—when it comes to engaging it on agriculture and fisheries.

Of course, it is too early to say what the precise effects of these changes will be on reform of the CAP, animal health and welfare or fisheries policy in the EU. The reason for that is that, to be successful, the reform must take into account the political make-up of the European Parliament as well as the Governments of the member states that sit in the Council. However, the current signs in relation to the common agricultural policy health check are promising. The draft opinion of the Parliament’s rapporteur on the health check includes many issues with which the UK would agree, including some dismantling of market-supporting regimes.

I note that the weight of evidence given to the EU Select Committee was favourable. Professor Simon Hix of the LSE, a leading expert on European Parliament voting patterns, suggested that surveys of MEPs had shown that in fact an overwhelming majority in the European Parliament was in favour of reforming the CAP. Professor Helen Wallace agreed that transparency of decisions would be increased by codecision. She believed that, in the past, Ministers of Agriculture,

“have been able to operate as a collusive club with rather little external scrutiny and in a way which was not very easy for national parliaments to get any handles on either”.

We think that that is an important and well made point. Indeed, when my successor, my noble friend Lord Rooker, was interviewed about this by the Select Committee, he agreed that the process had been opaque.

If the noble Lord will be patient, I assure him that I shall come to that.

I remind the Committee that the Lords EU Committee unanimously concluded:

“Much depends on the European Parliament itself, but the weight of the evidence suggests”—

those are important words—

“that the agriculture and fisheries committees of the European Parliament will in future represent, and be closely overseen by, a wider range of interests than the narrow … interests that have historically dominated those committees. For these reasons, we expect that the change is likely to assist rather than impede further reform of both the common agricultural and fisheries policies”.

That is why we argue that there should be support from all round the Committee for this extension of co-decision.

Some of us have been hearing this for many years—in my case, since the Maastricht debates of 1992. We have always been told that it will be jam tomorrow with the common fisheries and common agricultural policies. The noble Lord has just referred to the narrow interests which have been blocking progress towards reform. I ask him again: what are those narrow interests? May we or may we not expose the countries which, in the Council of Ministers, block this reform?

I do not necessarily refer to Ministers in the Council of Ministers when I quote our European Union Committee, which talks about narrow interests. I think that the noble Lord knows as well as I do to whom they may be referring.

I should really like to know what interests in Brussels prevent reform of the common fisheries and common agricultural policies.

Perhaps I may help. One major thing that stands in the way of reform is the fact that, as the noble Lord, Lord Tomlinson, said, the European Parliament has no control over the agricultural budget. As soon as it does have control, it will say that there are far greater priorities in the European Union, and I am afraid that money talks. With regard to the discussion about who initiates legislation, as the other House knows, one of the main controls over government is expenditure and working and controlling budgets. That is the key way that this will work, and the Lisbon treaty makes a fundamental difference in that area. I apologise for interrupting.

I am grateful to the noble Lord, but I think I understood what the committee meant. There are, however, some important exemptions where the European Parliament will not co-decide.

Clearly, among the interests that are being referred to are some agricultural ones around the membership of the European Union. That answer is not particularly inspiring, but I would claim it was rather obvious.

Will the noble Lord let me continue? There is much business to be got through tonight. On the agriculture side—

I apologise for interrupting the Minister, but could he explain something for those of us having difficulties in following the subtle implications of the answer? If these agricultural interests are strongly represented at the Council of Ministers level—presumably, because Ministers feel political pressure from public opinion and constituencies—why would that be different at a parliamentary level?

We will have to wait and see how different it is, but the straws in the wind show, we suggest, a much greater move to readiness for reform among members of the European Parliament. We will have to wait until after the next elections, as I said, to see what the European Parliament looks like; my noble friend Lord Tomlinson argued so and the noble Lord, Lord Teverson, agreed with him. Yet the fact will remain that that Parliament, with its limited budget, will not be able to do the things that it wants if it continues to agree to spend too high a percentage of its expenditure on agriculture. We think that the pressures will be there on the European Parliament once it has some responsibility. So far, it has had none at all and its Members can say whatever they like; it does not matter. However, they will have some responsibility now and we very much hope and expect that they will act responsibly.

There are some exemptions where there will not be co-decision. On the agriculture side, these include the fixing of market support measures such as intervention prices and import levies, while for fisheries these include limitations in the form of total allowable catches. Those are all responses to acute economic circumstances and inevitably require rapid reactions, which could not be guaranteed under the co-decision process. If the fisheries measure agreed annually in December were to be delayed, then implementation in the January immediately following would be severely compromised and the measures unenforceable, threatening the long-term sustainability of the stocks. That exemption is therefore simply an example of the EU adopting a sensible and practical approach to the annual fisheries negotiations and other similar measures.

I turn to Amendment No. 41A, which would require a statement from the Secretary of State on the Government’s objectives for the CAP and the CFP. We very much welcome the European Union Committee’s report, The Future of the Common Agricultural Policy, published in March this year. I have to declare something of an interest, as I was a member of its Sub-Committee D up until last November, but clearly not one when it formed its views and put them in writing. If I describe it, then, as a masterful analysis of the CAP’s strengths and weaknesses, I am not boasting.

As the Government have already indicated in their response, we share the key planks of the committee’s conclusions on the direction of future policy, not least because they resonate so closely with the Government’s own A Vision for the Common Agricultural Policy, published, as noble Lords will remember, in late 2005. That envisaged a future for EU agriculture as a fundamentally sustainable industry, integral to the European economy. It ought to be internationally competitive without reliance on subsidy or protection; it should be rewarded by the market for its outputs—not least for good, safe food—and by the taxpayer only for producing societal benefits that the market cannot deliver. It should of course be environmentally sensitive. It should be socially responsible to the needs of rural communities. It should produce high levels of animal health and welfare and the non-distortion of international trade and the world economy.

Our vision—our domestic view for farming—is of an industry that by 2020 is, first, profitable in the marketplace and continuing to produce the majority of the food we consume; secondly, making a positive net environmental contribution, particularly in respect of climate change, but wider than that; and, thirdly, managing the landscape and the natural assets that underlie it.

Here the Committee will be at one. Further CAP reform is a key element of achieving both our domestic and our European visions for agriculture. Despite recent improvements, the CAP remains expensive, wasteful and inefficient at providing ongoing support to farmers. It distorts global markets, weighs farmers down with regulation and acts as a disincentive for farmers to improve their competitiveness.

We call for an end to the market support and direct payment elements of the CAP by 2015 to 2020, because they damage developing countries, as has been said, are expensive and wasteful—costing approximately €50 billion per year—deliver poor value for money, and stymie the ability of EU farmers to respond to market signals and become truly competitive. That would represent a radical further evolution of the CAP: price support would gradually diminish as would other direct support to farmers; agricultural markets would progressively open up; and there would be a central rather than a peripheral role for rural development measures.

CAP reform is currently being pursued on two key tracks. The health check, which has been referred to, promises worthwhile adjustments to current CAP mechanisms and should be concluded before the end of the year. It will not in itself reduce overall CAP spending, but the health check has the potential to deliver some beneficial change that clearly signals the ongoing nature of CAP reform in the direction of market liberalisation and the delivery of public benefits.

In the longer term, the EU budget review, which follows on from the health check, will consider all EU spending post 2013—the end of the financial perspective—and is likely to result in a high-level Commission White Paper in late 2008 or early 2009, before the Commission change-over, which will inform the negotiations for the next financial perspective, which ought to begin in 2010-11. Due to its size, the CAP will rightly be a key focus for the budget review, as will the UK and other countries’ abatement.

We want the CAP health check negotiations this year to play an important part in the reform process by reducing regulatory burdens and giving farmers greater control over their business decisions; cutting further the trade and market-distorting nature of the CAP; and directing public spending more towards delivery of targeted public benefits, particularly environmental ones. The Commission is due to publish its legislative proposals for the health check on 20 May. The noble Lord asked me about what would happen next. The proposals are due on that day. The Government will run a full consultation and the legislative proposals will be subject to the usual domestic scrutiny procedures.

Does that mean that we will have a debate on the draft report in this House, or are we to wait until the ideas are developed into legislation and then presented to us with very little chance of our changing it? I think that the House would want the opportunity to debate the issue in full.

The noble Lord knows what I am going to say; he is experienced enough to know that will be a matter for the usual channels to decide. I am sure he will be a powerful voice in that discussion.

For all the reasons that I have set out—on which, in their attitude to CAP reform, I hope to gain consensus or fellow-feeling around the Committee—I do not believe that a statement as asked for in Amendment No. 41A would add anything new.

I want to sit down because we have other important business to attend to. However, these are important matters, and the noble Lord, Lord Pearson of Rannoch, has been waiting a long time for what I am about to say. I am going to tell him who is on our side, or closer to our view, rather than those who are not, so he will have to work it out for himself. As well as us, at least eight other countries in the EU are what we now describe as reform-minded. They are Sweden, Denmark, the Netherlands, Germany, Estonia, Latvia, the Czech Republic and Malta. It is important to have allies in this important enterprise.

Even among those who are not so enthusiastic for CAP reform, we believe there is some recognition now that further reform is inevitable and that the budget will be cut substantially after 2013. There is also much common ground on much of the detail of the CAP health check, particularly the measures which reduce burdens on farmers, such as abolition of set-aside and simplification of direct payments.

Finally, in a Financial Times article today my right honourable friend the Chancellor of the Exchequer is quoted calling for an end to direct support for European farmers and the abolition of all measures that keep farm prices above world market levels. The noble Lord, Lord Stoddart of Swindon, was kind enough to commend the comments that were quoted at any rate. I think that that shows quite clearly that the Government mean business. But as far as the Lisbon treaty is concerned—and I have to keep reminding myself that that is what we are debating in this House—I would invite the noble Lord to withdraw his amendment.

I would welcome the Minister’s response on this section in the Bill. As a former Defra Minister, he knows very well what goes on in discussions in the channels across the water. The countries that he named as sympathetic, or as sharing similar aspirations to ours, did not include France. France clearly has a very different view on protecting its farming and agricultural industry, or it certainly did in years past. How does the Minister think the European Parliament will overcome that particular problem? The representatives there will be equally difficult and will rightly be fighting for their own farmers. That is not for us because we have gone down a different route. However, France is a big player among the other countries.

I apologise to Members of the Committee; as I have not been participating in the debates I have not heard the earlier discussions on fisheries. One of the problems with the fisheries policy is that, although there has been review after review, every time a committee in this House or the other place comes up with recommendation, nothing happens, or at least nothing successful. So we still have loads of discards. Is the Minister confident that the proposals in the treaty will achieve this, or will we continue to go down that particular route? It is a very unsatisfactory route and has not improved much over the years. There is still abuse out there and not much being held to account.

May I also ask the Minister—

This is very relevant. My next question relates to the draft Marine Bill which will soon be before us. Will the European Parliament be able to override that legislation or have any say on it? Will it be a purely UK matter? It refers to waters around our own territory, to the devolved Administration in Scotland in the 12-mile limit and to the 200 nautical-mile limit. The European Parliament may well have a view in the longer term. What is the Government’s view? Has the issue been considered? Can the Government give us any better assurance than the Minister has been able to give us already?

In his last comments to us, the Minister told us that the health check, which is in progress at the moment, will not bring any immediate budgetary reductions. Can he say when he expects reductions in that budgetary commitment, because they are enormously important?


I am sorry that I am boring those on the Liberal Benches. I can only apologise, but these are important issues. The last issue that I want to raise is food security. I thought that Members on those Benches were interested in that. What confidence does the Minister have that the new arrangements will allow each of the member countries to be much freer than we have been in the past? We talked about the health check, but agriculture must compete in a world market, and I seek reassurance that the Government appreciate—I hope they have lobbied strongly enough—that the new arrangements will give us greater freedom. Those are my main issues, and I apologise if I have taken too much time. There are plenty more issues, but that is enough for tonight.

It is a pleasure to debate again with the noble Baroness, who has great expertise in and knowledge of agricultural and farming matters. I shall answer her questions very briefly; I think that the Committee may want to move on. We do think that the new measures will help. How can one ever be sure? We do, however, think that they will. Co-decision, on balance, is certainly a good move and may help to break what has obviously been an unsatisfactory position until now. I can tell the noble Baroness that, as the Marine Bill is national legislation, it will have nothing whatever to do with the European Union. On the health check, I said that it would not bring budgetary reductions. We will have to wait until the next financial perspective for substantial budgetary reductions to show themselves, but it is very important that the review in 2008-09 shows the way towards them. The negotiations that will begin perhaps a year or two after that leading up to 2013 will, we hope, lead to the reductions that we all think are necessary.

I have a question for the Minister that is not so much about agriculture as about his constitutional argument. He is saying that if the European Parliament were more involved, his best guess is that that would result in a more realistic attitude to reform of the CAP. He is saying that, if he is right, that will happen now. He is proposing—this goes into other areas and is a very important principle that we will debate elsewhere in our proceedings on the Bill—an increase in the powers of the European Parliament, and he is justifying it in this debate purely on the political outcome that it will have now and not on its merits per se. That is one of the dangers. These irreversible changes are made because they are to our advantage now, regardless of whether they will be to our advantage in the long term. That is one of the biggest issues in the whole debate on the whole treaty.

Briefly, there may be advantages to us in what we as a country want from the CAP in the future as a result of co-decision. I started my speech—I certainly intended to—by saying that the European Parliament is a democratic institution. It represents by direct election a very large number of people in the 27 countries of the EU, so it is a good thing for the European Parliament’s powers to be increased. I therefore rest my argument on two bases: one is the principal basis of it being a democratic institution; the other is that the results in this instance will be beneficial.

This has been a very useful area of debate on the Bill. It has certainly been wide-ranging. The noble Lord, Lord Hannay, challenged the relevance of some of the contributions, but that is surely the point.

If the changes in decision-making do not improve the operation of the CAP, noble Lords are right to point this out. It is interesting that the Minister has adopted a wait-and-see—a sort of hope-over-experience— policy. My noble friend Lord Lamont had it right. This issue stretches right across our relationship here, in this Westminster Parliament, with European institutions.

It is interesting that, in our discussion about a subject on which there is a large degree of consensus in the Committee, I have not heard a single noble Lord say that the common agricultural policy is underregulated. I have not heard a single noble Lord say that it is spending too little. We are all agreed that it desperately needs reform. When I asked about the role of this House and the debate that we might have on the health check, I got, quite rightly, a technically correct answer. However, when the Lord President introduced the Bill at Second Reading, she mentioned—I am sure that I did not mishear—that the role of national parliaments would be enhanced through the operation of this treaty. I hope that I am correct in that. If that is the case, why is it that we find ourselves unable to have much influence over this important area of policy?

That is why these amendments are important. The Westminster Parliament, both this House and the other place, has a role to play. I ask the Minister: what is the role of this House and the other place in CAP reform? Perhaps he might answer that question before I determine the future of my amendments.

Their scrutiny role, as far as the whole EU is concerned, is well known. Both Houses have an important scrutiny role. No doubt the views expressed both in this House and in another place on the issues that we have been debating tonight are listened to carefully by those in the Commission, by Ministers who represent this country on the Council of Ministers and, I am sure, by Members of the European Parliament. The role of national parliaments regarding the European Union is well set out and works pretty effectively as far as the UK is concerned.

That describes to my mind a spectator at a football match commenting on the skill of the referee in determining whether someone is offside. The truth is that, when it comes to decision-making, we have little or no authority on these matters. The reason why the CAP has failed or got itself into such a mess is simply that there is too little democratic influence on it. We were right to table these amendments. There is a role for Westminster in CAP reform. However, in light of the lateness of the hour and the rigour of the debate that we have had, I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

[Amendments Nos. 41 and 41A not moved.]

[Amendments Nos. 42 to 45 had been withdrawn from the Marshalled List.]

[Amendments Nos. 46 to 47A not moved.]

[Amendment No. 48 had been withdrawn from the Marshalled List.]

[Amendment No. 49 not moved.]

[Amendments Nos. 50 and 51 had been withdrawn from the Marshalled List.]

[Amendment No. 52 not moved.]

53: Clause 2, page 1, line 12, after “excluding” insert—

“(i) Article 2, paragraph 66, replacement Article 65 TEC (TFEU), paragraphs 1 and 2, relating to judicial cooperation in civil matters; and(ii) ”

The noble Lord said: I rise to move Amendment No. 53 and to speak to the remaining amendments in that line and to Amendments Nos. 57 and 59 to 61 in the next line. Under Maastricht—and some of your Lordships may be experiencing a certain nostalgia for the comparative clarity of that treaty—

I am sorry to interrupt but, according to my list of groupings, we have missed out the whole group of amendments starting with Amendment No. 46, which is on borders and asylum. I am surprised.

It is not a question of waking up. I have woken up and I have drawn the matter to the attention of the Committee. I did not agree to this.

It is not a question of agreeing; it is for the mover to decide whether amendments should be moved. The noble Lords, Lord Kingsland and Lord Hunt, in responding to the question from the Chairman of Committees, said that they were not moved. The Committee allowed that to happen and we are now on Amendment No. 53. As the noble Lord, Lord Kingsland, implied, we will go through to Amendment No. 61 and take two groups together.

It is possible for other noble Lords to move amendments but I do not intend to do so on this occasion. I am surprised, however, because I thought that we were all consulting one another on the process of these debates and keeping in touch. There is no point in involving the Liberal Democrats because they have no amendments. However, the rest of us are keeping in touch on timing and the order in which we take these matters, but no one informed me that we were going to leave out today the whole question of borders and asylum. I trust that we may come back to it on Report. The noble Lord, Lord Lamont, is urging me to move these amendments; he is, of course, free to do so himself. This slightly alters the understandings that we have tried to come to in order to finish by 11 o’clock tonight at the end of Amendment No. 53 or Amendment No. 57—I hope that we get there—and it may change the way that some of us behave in future.

The noble Lord should not look at me. What happened—as I shall explain to the noble Lord if he sits down—is that, when the amendments were called by the Chairman of Committees, the words “not moved” were said on the Front Bench opposite. At that point it was absolutely in order for the noble Lord, Lord Pearson, to leap to his feet and seek to move them. He did not do so. I was merely saying, by way of explanation, where I thought that we had got to. It was not a case of discussions going on; it was simply a case of where we had got to. The noble Lord can, of course, retable the amendments on Report. But that is what happened. I am merely giving him a factual explanation, nothing more.

This particular frog leapt with such speed that I was caught on the wrong leg and was not able to move the amendment in time. I merely put it down as a marker. I do not want to delay the Committee any longer, but if erstwhile noble friends on the Conservative Front Bench—or, indeed, the government Bench—are going to play this kind of trick in future, the rest of us would like to be informed. The Liberals are irrelevant because they have no amendments. I have nothing more to say on the group of amendments that have not been moved.

The Government have no amendments. I did not know that the Government were irrelevant to these Committee proceedings.

I did not suggest that they were part of the Government. I merely said that the main parts of the Committee are trying to get the Committee stage through in an expeditious manner so that we can cover all the areas in a time that suits the Government’s wider programme and so on. The leaving out of a whole group of amendments on no less a subject than borders and asylum came as a surprise.

Let me be very clear: the Government do not control the business in that sense. The noble Lord is correct in saying that the Opposition have put down amendments. However, they have chosen not to move them and to regroup; it is their choice. I am sorry if the noble Lord was not involved; I was just informed of that. It is a completely reasonable choice to make. The noble Lord is equally at liberty to choose what he wishes to do with his own amendments. He is quite correct: we operate in a spirit of harmony in an attempt to make this work appropriately. But, in the end, it is for those who are moving the amendments to make the best judgment based on what they think will work most effectively and, indeed, on the lateness of the hour. I have nothing but support for the opposition Front Bench for trying to do that as expeditiously as possible.

I warn my noble friend on the Front Bench that, if she goes out of her way to placate the noble Lord opposite for being so dozy that he does not hear what is going on when six amendments are not moved, she will be alienating me again.

Having just made some observations about the relative clarity of the Maastricht treaty, I had assumed that the noble Lord, Lord Pearson of Rannoch, had leapt to his feet to contest that proposition. In that sense I was rather relieved to find that he was on an entirely different point.

I am sorry, but I just point out that we removed Amendment No. 33 completely from the Marshalled List this evening and we agreed that with everyone in the spirit of what we are all trying to achieve. The noble Lord’s point is not well made but he had better carry on with what he is doing now, I suppose.

It has just been drawn to my attention by noble friends on the Front Bench that Amendment No. 55 has not yet been called; and if the noble Lord, Lord Pearson, glances at his text, he will see that it partially covers the area of immigration. So the noble Lord’s opportunity to dilate on this matter tonight, should he so wish, is not wholly undermined.

As I was about to say, under the Maastricht treaty Home Office, justice and police matters were dealt with under what was then called the Third Pillar, and that pillar was intergovernmental in character. The treaty of Amsterdam, as many of your Lordships may recall, moved immigration, asylum, border control and civil and family law from the Third to the First Pillar, which operates, as every one of your Lordships participating in these debates over the past weeks must know, on the basis of co-decision by the European Parliament, qualified majority decision-making in the Council and subject to the ultimate jurisdiction of the European Court of Justice. As a consequence of this, the Third Pillar was renamed Police and Judicial Co-operation in Criminal Matters and has so remained for the past decade. The treaty of Lisbon brings all the remaining Third Pillar matters under Pillar 1 and that is the central issue that your Lordships have to consider tonight.

The great political philosophers tell us that fundamental to the creation of states is the need for individuals in societies to be secure. That security is achieved by the prohibitions of the criminal law enforced by the police. For the European Union to take upon its own institutions the responsibility of passing criminal legislation and ensuring that it is implemented in member states on the scale suggested in the Lisbon treaty will have a defining impact on the European Union’s ultimate political character. We therefore have to ask: what is motivating those who press for these radical changes?

The new provisions are set out in Articles 82 to 89 of the new treaty. It is simply not possible to deal with all of them without occupying your Lordships for several hours. I shall just draw your Lordships’ attention to a few of the more alarming proposals.

Article 83(1) provides for the adoption of European Union legislation to establish minimum rules concerning the definition of criminal offences in areas of particularly serious crime with a cross-border dimension. The list includes terrorism, trafficking in human beings, the sexual exploitation of women and children, drug trafficking, arms trafficking, money laundering, corruption, counterfeiting, computer crime and organised crime. Moreover, the Council may, after obtaining the consent of the European Parliament, adopt a unanimous decision to include other areas of crime as well.

Article 83(2) provides for other criminal offences and sanctions where this proves, in the words of the new treaty,

“essential to ensure the effective implementation of a Union policy in an area which has been subject to harmonisation measures”.

The treaty goes on to specify that directives under this article are to be adopted by the same legislative procedures as are stipulated for the adoption of the harmonisation measures in question. So if a harmonisation measure were adopted by qualified majority voting, so would the related criminal offence and sanctions be.

Article 85 provides, inter alia, that Eurojust may be given the task, by the Council and the Parliament, of initiating criminal investigations as well as proposing the initiation of prosecutions and co-ordinating such investigations and prosecutions. Article 86(1) permits a European Public Prosecutor to be established in order to combat offences and acts against the financial interests of the Union. That decision would be taken by a unanimous vote in the Council. The related Article 86(2) provides that the European Public Prosecutor’s Office shall be responsible for investigating, prosecuting and bringing to judgment the perpetrators of offences against the Union’s financial interests. Article 86(4) allows the European Council, acting unanimously, to adopt a decision extending the powers of the EPP to include serious crimes having a cross-border dimension.

Lastly, Article 82 lists three aspects of criminal law that could be subject to harmonisation: the mutual admissibility of evidence, the rights of individuals and the rights of victims of crime. This latter category goes to the heart of individual liberties. It has a substantial overlap with the rights laid down in the ECHR and falls within an area where our own common law traditions differ substantially from the civil law provisions of our continental counterparts.

All this represents a remarkable break with the Maastricht model. Why has the Community—or those who have been driving the policy behind the treaty—made this radical break with the past? Many people in the European Commission, I understand, argue that this expansion of criminal responsibilities in the Community is the logical corollary of the freedom of movement of people. Without Community measures in this area, they argue, people would be able to escape justice by exercising their power to move freely throughout the Community. However, surely that task is addressed by the European arrest warrant. Its admittedly unattractive and unnecessarily draconian provisions nevertheless ought to solve 99 per cent of this problem. There is no logical reason for any harmonising measures.

Not surprisingly, the scope of these provisions has made some of the member states—that is to say, member states other than ourselves—hesitate as well; hence the emergency brake provision. Measures proposed under certain articles in the Lisbon treaty, where decision-making is enacted by qualified majority voting, are subject to these brake provisions. In these circumstances, any member state can pull its emergency brake where it considers that the draft legislation would affect fundamental aspects of its criminal justice system. As a consequence, the matter is then referred to the European Council and the legislative procedure is meanwhile suspended. Where no agreement is reached in the Council, the legislative procedure remains suspended; but if at least nine member states wish to proceed, then after notifying the Commission, the Parliament and the Council, authorisation for enhanced co-operation is deemed to have been granted.

If these measures go ahead in their current form, we are likely to see the enhanced provisions used frequently. This will lead to many member states in the European Community operating a set of criminal justice rules that are different from the remainder. Would it not be much better to proceed, as indeed we did under the old Third Pillar arrangements in Maastricht, with negotiations going on until consensus is reached? In those circumstances the Community would have a level playing field in matters of criminal law.

The relevance of the emergency brake procedure is reduced in the case of the United Kingdom, because of the protocol negotiated, which gives us the right not to opt in to individual measures. At present, the unanimity requirement in criminal justice obviates the need for any opt-in in this area. Under the treaty of Lisbon, as noble Lords are aware, the United Kingdom and Ireland have secured the right to choose whether opting in to all proposed measures falling within the field of freedom, security and justice is an appropriate approach in any given set of circumstances.

The protocol also confirms the right of the United Kingdom to choose whether to participate in the proposed amending measures. Opt-in provisions will apply to amending measures, as well as the original measure itself. However, by Article 4a(2) of the protocol, when the Council determines that the United Kingdom’s non-participation in an amending measure makes the existing measure inoperable for other member states, it may, by qualified majority, require the United Kingdom to reconsider its decision not to participate. If the United Kingdom maintains its position, the existing measure shall cease to apply to the United Kingdom. But, by Article 4a(3) of the protocol, the Council may, again by qualified majority, determine that the UK shall bear the direct financial consequences necessarily and unavoidably incurred as a result of its exclusion from the existing measure. I should like to ask the Minister how we came to agree to this. Quite apart from the desirability of having a measure of this sort in the protocol, how on earth could we possibly know in advance what the likely scale of our liability could be? Can the Minister be confident that the scale would be small, if not derisory?

The other problem in relation to the opt-in which is extremely vexing is that we have to take the decision to opt in at a very early stage of the negotiations. The early negotiations in relation to a particular measure may make what is likely to be the end product desirable. We exercise the opt-in and then the whole character of the negotiations changes and we realise that, for one reason or another, it would be damaging to the interests of the United Kingdom to exercise our opt-in. By then it will be too late to think again. As a consequence of this aspect of the opt-in provisions we are likely to be exceedingly hesitant to get involved at all in most circumstances.

Your Lordships will be extremely relieved to hear that I am turning to the final matter, which is the protocol on transitional provisions. Article 9 of this protocol provides that the legal effects of the measures adopted under the old Third Pillar, such as the arrest warrant, shall be preserved until those Acts are repealed, annulled or amended. Following the coming into force of the Lisbon treaty—if that ever happens—it is likely that the Commission will move swiftly to convert many such measures into directives under Title V of the TFEU. The transitional arrangements upon which the UK Government have insisted—inexplicably in my view—will last for only five years. We have apparently negotiated these special arrangements to ensure that where measures have not already been converted from the Third to the First Pillar, the Government can exercise what they describe as a block opt-out with respect to the remaining unconverted measures. Under Article 10(4) of the protocol, the United Kingdom may, six months before the expiry of the transitional period, notify the Council that it does not accept the new extended competences of the EU institutions over any outstanding Third Pillar matters.

Once again, though, we are faced with a system of financial penalties in this area. I pose the same question to the noble Baroness as I did earlier in relation to the opt-out protocol. How can the Government be so confident that these financial requirements that will be imposed on us will not be extremely expensive?

I think I have said enough to indicate that the scale of these new provisions in comparison with what has gone before is immense. The new powers of the Community are of particular concern when it is taken into account that their ultimate character will be determined not by our own courts but by the European Court of Justice. It is for those reasons that we have tabled these amendments. I beg to move.

I have no doubt that the measures that my noble friend has just explained are some of the most far-reaching and chilling proposals in the whole treaty. As they are understood by the population at large, they will cause outrage. What my noble friend described was, as he said, the abolition of the intergovernmental nature of these justice and home affairs measures and their incorporation into the main treaty in a way which will bring in QMV, the jurisdiction of the European Court of Justice and co-decision by the European Parliament.

Matters of criminal justice and policing are matters for a nation where the electorate can elect or de-elect the Government who are responsible for those matters. The electorate can hold that Government to account. They can elect or de-elect the parliament that makes those laws on their behalf. I do not believe that a European council voting by majority is democratic representation of a nation. Nor do I believe that a European Parliament, however much language is used about it directly representing European citizens, represents a national voice on these matters or is an appropriate forum to decide the national laws that apply in this country.

The European Union is not a nation. The United Kingdom is a nation. Its Parliament is the place where criminal laws, policing laws and the role of justice in this nation are decided until such time as the Government tell us that we are no longer a nation and the European Union has become that nation—a proposition which, thankfully, they continue to deny. The fact that this treaty moves us away from a nation having control over its own laws in this area is a hugely significant matter. In support I quote a much-quoted report from the European Committee of this House, which has made some salient points on the matter. It said:

“The move to QMV in almost all areas of FSJ is a significant change … It is likely that one effect of the change will be an increase in Union activity and the volume of legislation agreed in this area”.

The European Union has not brought in these measures in this treaty to sit on the sidelines; it has brought them in to legislate in these areas. That is what it intends to do. The report continues:

“The change will remove Member States’ vetoes in respect of criminal law and policing and legal migration. This means that it will be possible for the UK, in some cases, to be bound by a measure in the area of criminal law or policing against its will, although the likelihood of this happening will be greatly reduced by the existence of a general right not to opt in for the UK”.

I will return to that point in a minute. In respect of the power of the ECJ, the report continues:

“For the first time, Member States will be able to be taken to the Court for failure to implement properly EU legislation in the area of criminal law and policing”.

In other words, even if this Parliament were to vote for a measure that reflected the will of the people of this country, this Government could be taken to court in Europe for not implementing a different measure that had been voted in by QMV in Europe. That is what we are considering.

I am sure that the Government will say, “That is all very well, but we negotiated opt-ins”. There are two problems with the opt-in, which my noble friend on the Front Bench has mentioned. The first is the matter of existing measures which we have already agreed under the previous arrangements where we will not have the choice of retaining the status quo. We will have either to agree to those measures being brought in to the new area, where the Court of Justice and QMV applies, or to opt out of those measures and bear whatever costs are imposed. Again, the report makes it clear that,

“the Treaty does not leave open the option of retaining the status quo in respect of Title VI measures after the transitional period. At the end of the period at the latest, the UK must either accept the Commission’s enforcement powers and the ECJ’s jurisdiction in respect of such measures or exercise its block opt-out, again accepting that if it chooses to opt back in to any particular existing measure, the Commission’s enforcement powers and the ECJ’s jurisdiction will apply”.

There is a whole set of measures where we would be forced either to comply or to opt out and bear the cost. There would be many other areas where, at first blush—the Government are trying to be friendly and co-operate within Europe—we will agree to areas that are then amended. The problem is that once we have agreed to an area, any amendment that follows will be by QMV and will bring us under the jurisdiction of the ECJ. Again, I quote from the report:

“The suggestion that the UK, having opted in to a proposal, could argue that its opt-in did not extend to fundamental amendments to the proposal during negotiations raises an interesting legal question. But the question is unlikely to arise … In some areas of criminal law and policing, a dramatic change during negotiations may permit the UK to use the emergency brake to halt a measure’s progress. In other cases, the UK may end up bound by a measure with which it does not fully agree; this is the nature of QMV”.

We are entering territory where a fundamental shift is happening in the criminal justice and legal system, which is moving from an area that is under national control of a national parliament and national Government, elected by the citizens of the country, to a territory where it can be imposed on us by qualified majority voting or parliamentary decisions in Europe, even where this nation has a different view. We should not do so without having that fully explained to the people of this country.

We are looking at new provisions in the Lisbon treaty that will augment co-operation in civil and criminal proceedings. I recognise that the changes made in this area by the Lisbon treaty are very important and are among the most important of all the changes made by the treaty. It has to be recognised at the same time that the United Kingdom and Ireland are affected by those changes far less than other member states, because we are not bound by future changes unless we choose to opt in, and that is a very important provision indeed.

There is much to gain from co-operation in both civil and criminal matters. For example, the recognition of foreign judgments in both civil and criminal cases is important to prevent unreasonable delays. If judgment in one country needs to be enforced in another, non-recognition in the latter of that judgment basically means that the whole issue has to be retried, which creates injustice and unnecessary expense. We need further EU legislation on a number of issues. I will give one or two examples from my experience as a member of Sub-Committee E of the EU Committee.

We need an agreement in civil cases for a common small claims procedure without the EU so that, for example, a tourist from the United Kingdom who has booked and paid for hotel accommodation in Spain can sue the hotel for failure to honour that obligation. It is more or less impossible for that to happen now, because the costs and difficulties would far exceed the amount of money that could be recovered. We need a simple process that is the same across the EU, which minimises the language difficulties and enables someone to recover damages suffered under a small claim at minimum cost and expense.

Another problem, which I have very much seen in action during my time as a trustee of Fair Trials International, is the absence of proper legal assistance and interpretation in criminal trials in many countries. All countries in the EU already have an obligation under Article 6 of the European Convention on Human Rights to provide legal assistance where the defendant cannot afford it, and to provide interpretation. However, this is simply not observed in many countries. Fair Trials International had great difficulty when people from this country were arrested and tried in Greece for plane spotting. That had a happy ending, largely because of the intervention of FTI. However, it showed the legal defects very clearly.

The EU has been considering introducing laws on small claims, and on support in criminal trials, but there has been no agreement. I believe that the United Kingdom would support warmly both of these, but no agreement is likely to be reached under the Third-Pillar procedure, which needs unanimity. Some smaller countries in the EU are not willing to join up. Any agreement on the recognition of judgements would need safeguards against judgments obtained by fraud or corruption. However, limitations on recognition should be confined to those matters that are necessary to avoid injustice.

We also need, among other things, an agreement about the proper forum for trials, to prevent conflict and abuse. Another method of co-operation that would be helpful, particularly over smaller claims, would be to limit the need for witnesses to travel to countries where trials are being held, by allowing them to give evidence by video link. In the past, this has been difficult to achieve, because it was expensive. However, IT developments in recent years are making it much more viable and it is now likely that if this was proposed by the EU, we would get qualified majority support for the video links—but, again, we would be unlikely to get unanimity.

The problem for the United Kingdom and Ireland is that whereas we have a common law system, most other EU countries have a code-based system. However, we are protected—and this is perhaps the main justification for our protection—by our right not to be bound by new legislation unless we have opted in. However, we should not assume, without looking at it on a case by case basis, that our procedure is always better and must always be defended.

The exchange of information and evidence by ports and the police, and by police forces of different countries, is very important when countries face cross-border and organised crime and terrorism. It should not be excluded by minor technical differences in procedure. We have agreements on procedure that have been obtained under the Third Pillar—for example, the European arrest warrant. However, the framework agreement for the EAW may need amendment in the future. Under the Third Pillar, amendments would also need unanimity. This would likely lead to existing agreements becoming out of date, and either ineffective or too restrictive.

The noble Lord, Lord Kingsland, recognises that we have the right not to opt in. However, why should we insist, as he suggested, that new EU legislation, which will often be something that we ourselves welcome, can be blocked by the objection of, let us say, Slovakia? One small member state of the EU will be able to block what everybody else wants.

We also need to look at Amendment No. 58, which aims to prevent Eurojust from carrying out criminal investigations. Investigation by Eurojust may well be useful in cases where internal investigation into misuse of EU money would not be pursued with enthusiasm in a particular member state. That is unlikely to be a problem in the United Kingdom, where we can be confident that this problem does not arise; but it arises in some other countries. It may well be, therefore, that the intervention of Eurojust would mean a greater likelihood that fraud against the EU—which we are all deeply concerned about—would, perhaps for the first time, be brought under control.

There is also the question of Amendment No. 59, on the European Public Prosecutor’s Office. I am somewhat sceptical about that. It is doubtful that it is desirable to set up an entirely new system of prosecutions for fraud against the EU that would operate independently of national courts. But under the Lisbon treaty the introduction of the Public Prosecutor’s Office requires unanimity. It is unlikely to get that from the United Kingdom. That would of course leave the possibility of nine or more states setting up arrangements for the operation of the Public Prosecutor’s Office under enhanced co-operation. I see no reason why we would wish to prevent that happening. While it may be unlikely to succeed, it could do so, and if it were to be successful that would justify a wider use of the EPPO.

Police co-operation is extremely important for dealing with cross-border crimes. Incompatible systems for collection and storage of data make work for police much harder. We should not start with the assumption that other countries want to force on us measures that we would not want to have. If that turns out to be the case, we can always fall out on not opting in.

Europol seems to be an organisation that has a useful role in the fight against crime and I am happy for it to be involved in investigation and operational matters. We always have the protocol to fall back on.

I do not think that any of these amendments is necessary. All of them are likely to make the possibility of achieving effective legal action against misbehaviour in European countries harder to achieve.

I am very grateful to the noble Lord. Given that the noble Lord, Lord Kingsland, has grouped together two groups of amendments, I shall try to do what the noble Lord, Lord Goodhart, did and deal with these issues one by one and, perhaps, address the concerns that noble Lords have raised. I recognise the importance of the moves that have been made in the areas of justice and home affairs. I declare my interest in that I was a Minister who sat on the Justice and Home Affairs Council for just under three years and I have some experience of the opting-in process that noble Lords have referred to.

The noble Lord, Lord Kingsland, took us on a journey through Maastricht to Amsterdam on the way that justice and home affairs have evolved. Indeed, one can look back to the beginnings in the 1970s of the Trevi group and see the moves within Europe to recognise the importance of co-operation in matters of justice and home affairs to achieve common ends—particularly on issues such as serious and organised crime. Those moves tried to make sure, as the noble Lord, Lord Goodhart, said, that in areas of civil justice, where people live, work, study, travel, buy or sell across the European Union, they have the benefit of knowing that they can rely on the EU to work together to resolve any problems that may arise.

Put simply, if you are a tourist who buys something in a shop in any part of the European Union and it is faulty or breaks, you know you can be recompensed. Equally, it makes it easier to have debts repaid to you because of transactions that you have undertaken. These are issues that I worked on personally across the European Union in my time as a Justice Minister and I know the importance of the potential benefit to UK citizens. It is in that context that I want to talk about these matters.

I think it is important when we look at the area of justice and home affairs, particularly in terms of judicial co-operation, that we look at what is within Article 81 of the consolidated treaties. When I was a Justice Minister I spent a huge amount of time on Article 65, trying to make sure that we considered it in the context of cross-border implications. I was very pleased to see that the treaty helpfully makes clear that measures in that field must be based on the principle of mutual recognition. From a UK perspective, that is an improvement on what went before. It is very important to me that we are recognising each other’s legal systems and not seeking any form of harmonisation. That is an important principle that is much clearer within this treaty than what went before.

As noble Lords have said, family law remains subject to unanimity and the consultation procedure with the European Parliament. There is a passerelle clause that allows family law measures to move from unanimity to qualified majority voting. It has appeared in every treaty from Amsterdam onwards but, under the Lisbon treaty, national parliaments have the right to veto its use.

Going back to the amendments that the noble Lord, Lord Taylor of Holbeach, who is not in his place, was concerned about and that my noble friend Lord Bach discussed on recognising the importance of the role of and strengthening the control of national parliaments, here we have an example. I am not sure whether the noble Lord, Lord Kingsland, spoke to Amendment No. 55. No? I will not deal with it because I thought he was going to. I will leave it for another time.

I will speak to Amendment No. 56, which is next on my list and deals with Article 82 in the consolidated version of the treaty on the function of the European Union. It talks about judicial co-operation in criminal matters, which is currently under Article 31 of the treaty of the European Union. Again, I think that that is an improvement on the existing treaties in a number of respects, which was implicitly acknowledged in the report of the Select Committee. It said that Article 31 was of “uncertain and controversial width” and replaced it with an exhaustive list of areas of criminal procedure where the adoption of minimum rules could be proposed. It concluded that what it described as that “clarification and definition” was,

“unlikely to involve any significant expansion of jurisdiction”.

The new provision expressly limits activity in this area to,

“the extent necessary to facilitate mutual recognition”,

and to police and judicial co-operation in criminal matters,

“having a cross-border dimension”.

Again, these are important areas of clarification. It also explicitly requires that rules created under this provision should take into account the differences between the legal traditions and systems of the member states. All these requirements are welcome and I would have thought that the noble Lord, Lord Pearson of Rannoch, might welcome them as well because of the importance of mutual recognition of traditions and legal systems of individual member states.

In moving the provisions on judicial co-operation from a system of unanimity and consultation to qualified majority voting and codecision, we have extended, as the noble Lord, Lord Kingsland, rightly said, our opt-in to apply to these provisions. That means that we choose whether we participate in them. We cannot be obliged to participate in such measures where we deem that they are not in our interests. Of course, as the noble Lord, Lord Goodhart, made clear, there will be many occasions when it is in our interests to co-operate with our European Union partners. Criminals and organised gangs do not respect borders, and therefore we need to work with our partners in pursuing cross-border prosecutions.

The existing provisions on judicial co-operation in Article 31 of the European Union treaty provided the means to create the European arrest warrant, which is now working successfully in combating those who seek to evade justice by crossing borders. It enables the UK to bring to justice those who have fled the country. As noble Lords will know, one of those suspected of the 21 July 2005 attempted bombings in London was swiftly returned to the UK from Italy using the European arrest warrant and has subsequently been convicted.

Amendment No. 57 relates to the inclusion of “organised crime” in the list of crimes where the EU, by qualified majority voting and codecision with the European Parliament, can establish minimum rules concerning the definition of criminal offences and sanctions. As I indicated, Article 31 of the current treaty provides for the adoption of measures establishing minimum rules. On that basis, the JHA Council has already agreed a framework decision which requires member states to have in their domestic laws offences and penalties relating to participation in a criminal organisation. That decision is wholly consistent with the Criminal Law Act 1977, which is the relevant UK legislation on conspiracy and defines “organised crime”. The framework decision provides for member states to opt either for offences of participating in a criminal organisation or for offences founded on national conspiracy laws. Therefore, we are able to support the framework decision on the basis of the laws that we already have in place. It is an important element in ensuring that there are no safe havens for criminals across the European Union. Through collaboration and through the lists that we have put forward, which the committee says are a step towards an exhaustive list, the minimum and possibly the maximum rules are set out. Criminals will therefore know what will happen to them in any state in the European Union, rather than being able to evade justice. That is particularly important in the area of terrorism.

Amendment No. 58 concerns the provisions relating to Eurojust’s ability to initiate criminal investigations. The Lisbon treaty—

The Minister talked about mutual recognition of judicial systems but Article 83 goes much further than that. It talks about minimum rules, and rules include sanctions, which I assume means minimum sentences. Does she really believe that this is necessary? When she talks about safe havens, does she believe that for an offence such as terrorism there is a safe haven within the European Union? Most people would accept that we should respect the judicial systems of other countries. We have the arrest warrant. Do we really need to go so far as minimum sentences for these offences? Is she suggesting that countries within the European Union have penalties that are so lax that we need to alter them at a supranational level?

Before the noble Baroness responds, perhaps I may venture to answer that. I do not know whether the noble Lord is aware that before the 2002 framework decision on terrorist offences, many EU member states did not have a specific offence of terrorism or any penalties. Presumably they dealt with such incidents under laws of murder or grievous bodily harm. It was necessary to have the ability to facilitate cross-border investigations and prosecutions, and therefore coherence and consistency were important so that every member state in the EU had offences of terrorism and incitement to terrorism. The noble Lord expresses amazement that that was the case but I am afraid that, until six years ago, it was.

The noble Baroness has answered the question. I hope that the noble Lord, Lord Lamont, will accept that a number of states in the European Union did not have an offence of terrorism. Although I struggle to remember the exact number, certainly many did not. It was important in the light of what happened, not only in London but, before that, in Madrid and further afield, to decide that member states needed to make sure that they had that offence covered properly. That was one example, but there are others.

When I talk about mutual recognition, when working within the European Union I am looking to make sure that there is recognition of the system operating within a member state—particularly as we are a common law country, while many countries with whom we are working are not—so that we do not get a different legal system imported instead. Looking at cross-border questions, then, one is looking for mutual recognition linked to a system by which one can ensure that jurisdictions operate across the two.

I shall give an example. The idea of the small claims procedure was that it operated in each member state and that procedure could be used across borders. Yet that did not affect the functioning of the individual member state; rather, the system was built on recognising that systems might be different but the outcome should be that a claim could be made to get money back that was owed across the border. That is what mutual recognition is about.

In the context of the lists that were described in the procedure, safe havens may not be a phrase liked by the noble Lord, but is precisely to ensure that in areas where we understand what we mean by criminality—for example, in terrorism—there is absolute clarity on what will happen within each member state, and we work together both to bring criminals to justice and to ensure that that justice matches across member states. I do not believe that is contradictory to making sure that individual judicial systems work effectively, not least because of what I have said about mutual recognition. However, it is important to ensure—and we had this example—that if something as grave as terrorism is not recognised within member states then it should be, as part of the great co-operation that should exist between member states in the European Union.

Most of us would accept that states should co-operate to assist each other in many areas, for example in combating terrorism or money-laundering; the Minister mentioned a number of other areas. What has not yet been justified is why those areas of co-operation—which are obviously beneficial to all those states involved—cannot continue to be achieved by intergovernmental co-operation, as they have been under the old Pillar 3 provisions.

Why is it necessary to have EU legislation, with things introduced by qualified majority voting and a codecision of the European Parliament, as opposed to states agreeing that they want to co-operate on these sensible areas? Those matters do not start and end at the European Union borders. We have to co-operate with the United States and with other countries; why do we need to move away from the intergovernmental process in this fundamental area?

Well, one argument used against the intergovernmental process is the length of time that it can take to reach a decision, particularly when 27 member states are trying to find a way through an issue. Secondly, there is always a danger—and, if my memory serves me well, my right honourable friend Jack Straw mentioned this in discussion with the European Union Committee—of the lowest common denominator applying.

I can think of circumstances on the Justice and Home Affairs Council, where I sat, where one looked for ways through particular questions but, because of one or two member states having particular issues—which I am not saying were unimportant or irrelevant, but they could none the less have been surmounted—we spent a huge amount of time trying to do that. We did not, in the end, necessarily solve the problems as effectively as we might have.

For example, we have been looking at the recognition of people who have had driving bans. That took place many years ago but it has still not yet come into force. One question, then, in looking within an amending treaty on how to make a union of 27 member states work most effectively is whether there are better ways to do that. Now, from a UK perspective, we have clearly been sure to build into our position that we will not come into a measure on justice and home affairs unless we believe it is in our national interest. Many times, it will be; on occasion, it will not. I did not opt in to every measure. It is important that we retain that power, because we need to ensure that our national interest is always covered, but that is within the context that one’s ambition is that where measures are advanced, they are for the mutual benefit of all member states, so we would want to participate as fully as possible.

I am grateful to the noble Baroness; she saw me looking puzzled. Reverting to my question, given that we have the European arrest warrant, which provides for near automaticity of extradition from country A to country B, and given that the European arrest warrant has abolished the requirement that an offence for which a person is being extradited had to be—at least in British law, it used to have to be—an offence in this country, and you can be extradited for an offence that is only an offence in the country to which you are being extradited, why do we need this precise harmonisation of the definition of criminal offences?

The noble Baroness kindly answered—not entirely to my satisfaction, but she gave me a very interesting answer—my previous question. As she said, although a country does not have an offence called precisely terrorism, there are other offences: murder, grievous bodily harm and intending to harm people. Why is it necessary to have this European-wide imposition of a common definition of offence when we have an extradition procedure that provides that people would be extradited for those offences anyway?

If we read the exhaustive list being put forward, my perspective is that it is very important, as a European Union collaborating on judicial and police matters, to look for areas where the best proposition to put to those who would perpetrate those crimes is that within all the member states, there is a commonality of what the tariffs—the minimum standards, if you like—could be, rather than relying on X person moving to country Y, where there is not such an offence or where the tariff is much lower and having to seek, through the European arrest warrant, a solution.

The noble Lord is right to say that the European arrest warrant is a useful and helpful tool—it has certainly been extraordinarily helpful to the UK—but I do not believe that that is the only solution. As crimes become more international in their nature and as serious and organised crime operates across borders—for example, people trafficking and drug trafficking can occur throughout the European Union, and serious crimes can operate in more than one nation state—having a commonality of the minimum tariff, and so on, can be a huge benefit.

The advantage of the Lisbon treaty in that is that it puts that list forward more clearly. That should give some comfort and assurance to the noble Lord that this is not inexhaustive but, rather, is exhaustive and can be added to only under the procedures proposed.

Does the noble Baroness agree that it is astonishing that when the experts are warning us that we are not getting to grips with the Mafia and serious organised crime and there is a real challenge with this, those on the Conservative Benches and in UKIP are complacent and do not want the EU to have the capacity to get to grips with those extremely serious problems? One would understand that if it were about health or education, where there are obviously issues about domestic competence, but on serious organised crime I cannot understand why there is resistance to the EU giving itself competence to grapple with those incredibly serious threats.

Before the Minister answers that question, can she enlighten us on how those new powers over justice and criminal procedures will deal with the problem of the European Commission itself and the enormous amounts of money that go walkabout every year under the Commission’s control?

The Court of Auditors estimated in its last report that 57 per cent of the overall budget, or €43 million, received an adverse opinion. The court said:

“Regardless of the method of implementation applied, the Commission bears the ultimate responsibility for the legality and regularity of the transactions underlying the accounts”,

of the European Communities. I would be interested to know if this brave new world of EU legislature is going to be able to deal with that.

I understand the noble Lord’s concern about budgetary issues, which we have already discussed twice in Committee, but I take issue with him on whether this is the appropriate moment to raise it. We are discussing issues of people trafficking, drug trafficking, terrorism and whether that should be tackled on an EU-wide basis. Issues to do with the budget, important though they are, are outwith this group of amendments and I will not respond at this point.

I accept what the Minister is saying, provided that we can come back to the point and reach a satisfactory answer. But in response to the points made by my noble friend Lord Lamont on the arrest warrant, would she care to take the opportunity to confirm—she has already done so in a Written Answer—that the crime of xenophobia will not be applied in this country and that people found guilty of it, or alleged to have committed it, will not be extradited under these new powers under the European arrest warrant? That would be helpful and encouraging for those of us who fear that, if we continue to speak against the European Union when it acquires legal personality and has in effect become a state, we will be committing the crime of xenophobia. If it is so ridiculous then it would be good to have her confirmation that that will never happen. I would feel somewhat more comfortable.

The noble Lord may be guilty of many things, but I do not think he need fear—not least because xenophobia is not on the list of crimes that have been referred to this evening—

The noble Lord has an amendment much later on in our deliberations and I do not want to pre-empt what will no doubt be an interesting discussion in which other noble Lords may wish to participate. I have had enough problems with collapsed groups of amendments for one night and would like to try to get through this. I am not worried about the noble Lord being arrested. He is quite safe. He might be worried but he worries needlessly, not least because he is sitting in your Lordships’ House. He is perfectly entitled to make his views known and he does so with great gusto, even if he did refer to himself earlier as the fluffy end of the lollipop.

Amendment No. 58 is about the role of Eurojust and its ability to initiate criminal investigations. As noble Lords said—and I think the noble Lord, Lord Kingsland, referred to this—the Lisbon treaty creates a new legal base for Eurojust, building on that which is already in Article 31. It provides an extension of the mandate by envisaging that it could be provided with the power to initiate criminal investigations where at the moment it can only request such action from a member state. Paragraph 2 is clear—and this is important for our discussions—that such formal acts of judicial procedure shall none the less be carried out only by competent national officials.

Although the legal base for Eurojust provides for the possibility for extending the remit, it is clear that the UK could not be bound by such a proposal unless we specifically opted in. It would require a new legislative proposal and our extended opt-in would apply to this provision as to the rest of the chapter. So we would have the right to choose whether we participated in any measures to amend or replace the Eurojust council decision and would do so only if it was in our national interests. I should make it clear, in the spirit of being extremely positive about what works well in Europe, that working with Eurojust has been beneficial to the UK. Since 2002, it has given considerable assistance to the UK and has been central to combating drug and human trafficking, serious fraud, money-laundering and child pornography in Europe. I hope that the noble Lord will feel that I have answered his question well.

Amendment No. 59 is the next amendment in this sequence of amendments and concerns the provisions on the creation of a European Public Prosecutor. Article 86 of the Treaty on the Functioning of the European Union includes provisions for the creation of a public prosecutor who would investigate, prosecute and bring to judgment the perpetrators of and accomplices in offences against the financial interests of the Union. We have a double lock on any move to create a public prosecutor. In lock 1, the opt-in applies and we choose whether to participate. As the noble Lord, Lord Goodhart, said, it is very unlikely that we would wish to opt into a proposal to create a public prosecutor. In lock 2, unanimity is retained for any decision to establish such a prosecutor and for any decision to extend the prosecutor’s powers. In the unlikely event that we opted into a proposal to establish one, we would have a veto over any decision to extend those powers. In no circumstances can we be obliged to participate in the creation of such a public prosecutor but, as noble Lords have said, if nine of the member states wish to proceed under enhanced co-operation, they are free to do so. That does not affect the UK unless we decide to participate.

Amendment No. 59A relates to the provisions on the collection, storage, processing, analysis and exchange of relevant information in relation to the prevention, detection and investigation of criminal offences. The new article sets out the legal base for police co-operation measures. Such measures, as the noble Lord, Lord Goodhart, said, are subject to QMV and codecision. This includes the provision for the collection, storage, analysis and exchange of relevant information. We believe that the exchange of information throughout the European Union is vital; it enables us to work together to tackle common threats such as terrorism and organised crime so that we can pursue and prosecute criminals more effectively. This co-operation has given us access to crucial data-sharing arrangements, such as introducing a mechanism that allows the police to access fingerprints, DNA and vehicle registration information held by other member states. Noble Lords will probably be aware that there was a pilot project with the German police, who accessed data from Austrian police and are now investigating new leads on more than 1,500 unsolved crimes, including serious offences such as rape, murder and sexual offences. We hope to see the benefit to UK investigations and we want to pursue this. The amendment—I am not suggesting that this is its purpose—would deny us the benefit of this valuable co-operation.

Amendment No. 60 concerns the provisions relating to Europol and Amendment No. 61 relates to the provisions on Europol’s operational functions. Under the new article, Europol’s mission is,

“to support and strengthen action by the Member States’ police authorities and other law enforcement authorities in preventing and combating serious crime affecting two or more Member States, terrorism and other forms of crime”.

Again, these are very important issues. Europol was created under the Maastricht treaty and formally set up by an EU convention in 1998. That convention is due to be replaced this year with a Council decision.

It is in our interests to co-operate with Europol. Noble Lords will know only too well of the potential, and indeed the reality, of the work that Europol has done to break up violent and armed gangs of eastern European robbers who had already committed more than 20 attacks in the UK, to break up child pornography networks and to support the Midlands police force in breaking up a people-trafficking ring that involved Chinese and Iraqi people. Europol is very important. Perhaps its most important investigation involved the Cambridgeshire letter bomber. It gave direct support to the Cambridgeshire police, which led to the apprehension of an individual who was convicted of sending explosive devices through the post. When he was arrested, he was found to be in possession of a number of explosive devices that were ready to be posted. There are direct benefits to the UK in collaborating with Europol.

The noble Lord, Lord Kingsland, said a little about Amendment No. 94. We will come to this amendment much later on, so I do not want to go into too much detail, although I will say that it is about “financial penalty”. The UK cannot be fined for deciding that it does not wish to opt in or opt out of something. We will discuss that in greater detail. When we come to look at the provision, it will be important to see that this is not about a financial penalty, but about a recognition that, if as a consequence of the UK’s action it becomes inoperable, then it is only reasonable that it may be required to contribute financially to make sure that the consequences of that inoperability are dealt with. I have dealt with that as much as I can. I shall write to the noble Lord, Lord Pearson, on xenophobia, rather than go back into that right now. I hope the noble Lord, Lord Kingsland, will feel able to withdraw his amendment.

I should like to thank my noble friend Lord Blackwell, the noble Lord, Lord Goodhart, and, of course, the noble Baroness, for their substantial contributions to this important debate. I am not convinced—even after listening to the noble Baroness—that the changes in this treaty are necessary.

The objects that the noble Baroness has said that those changes are intended to achieve can be equally well achieved by a combination of the arrest warrant and intergovernmental co-operation. I have heard nothing from the government Bench this evening to change my mind. Indeed, in many respects, informal co-operation between member states in tackling so many of the problems mentioned tonight is probably just as effective as any formal agreement between member states. One should recognise that, just as constitutional conventions in this country play such a crucial part in the successful way we operate governmental affairs, so, equally, conventions between member states can have the same effect internationally.

The noble Lord, Lord Goodhart, admitted that these changes were important but, rightly, went on to say that the United Kingdom need not be affected by them because it has the opt-out provision. There are, as I tried to indicate in my opening remarks, frailties in the opt-out provisions. However, generally speaking, I accept what he said; but that is not the point of our amendments. They were about what those measures are doing to the European Union itself. In our submission, these measures are changing the character of the European Union in a way that will prove extremely undesirable.

It is often said that the threat we are faced with is that the European Union will become some form of executive Government. Some describe it as a state. Originally, under the treaty of Rome, that conclusion would have been difficult to draw from the initial measures. One could say, perhaps, that the Community was federal in that it had a court that could override the decisions of national courts; but one could not say that it had a Government in the sense that national states have.

However, these measures are an undesirable step towards executive centralisation that will prove extremely damaging to the European Union. They will not only affect, adversely, the attitude of citizens to it, but will also undermine all those good things that it has done. I will give you an example. One of the most ingenuous instruments the Community has developed over the years is the directive. It has been fundamental to the success of establishing a single market—its ingenuity lying in the fact that all the implementation is within the power and the legal systems of the member states.

For example, as I indicated in my opening remarks, under Article 83.2 the Union will take on the power with respect to any harmonisation measures to introduce its own criminal law system and to implement it from the centre. This is the destruction of the concept of the directive. It will make member states, in future, extremely reluctant to enter into fresh areas of harmonisation knowing that the directive will be undermined by the Union’s ability to impose rules from the centre. These measures will have a damaging effect on the European Union that goes far wider than what they say in themselves.

I have been following the noble Lord’s argument with interest, but where does he draw the line? Are the Conservatives saying that they now accept the European arrest warrant—they certainly resisted it some time ago—the existence of Eurojust and the existence of Europol, or are those over the line and should we now draw back? It is important to know just how far we are going. I have heard senior members of the CPS say how useful Eurojust is—I am sure that the noble Lord, Lord Kingsland, has heard the same—but do these measures take us beyond the old line, which we have to hold, or do the Conservatives say, “Thus far, but no further than where we have got to after that”?

Before the noble Lord answers that question, perhaps I may ask him about the criminal justice system that he is suggesting will be imposed on this country. What criminal justice system? What is the mechanism by which this imposition is to take place?

I am not suggesting that it is going to be imposed on this country, because we have the benefit of the opt-out.

I find that an uncharacteristically astonishing observation from the noble Lord, Lord Thomas. I have tried to make it clear in my winding-up speech that my concern was not primarily our opt-out but what these measures would do to the character of the European Union in general. We want the European Union to be a success. These measures will contribute substantially to the European Union not being a success. That is what lay behind my observations.

Perhaps I may repeat my question: what criminal justice system can be imposed on any country, and by what mechanism?

The mechanisms are set out in Article 83. They are there for the noble Lord, Lord Thomas, to read in relation to evidence, the rights of victims and the individual liberties of the citizen. All these aspects will now be legislated on by the European Union under the first pillar system. That will dramatically change the justice system in the European Union member states. That is absolutely plain from the text of the treaty.

I am now trying to remember the questions put to me by the noble Lord, Lord Wallace of Saltaire. As far as Europol is concerned, the noble Lord, Lord Goodhart, said that he had reservations about the EPP. I cannot remember exactly whether he extended those reservations to Eurojust, but he certainly said that he had reservations about the EPP.

I do; I said that I had reservations about the European Public Prosecutor’s Office. But I welcome both Eurojust and Europol.

It is common knowledge that we have hesitations about both organisations. If they were established by voluntary agreement or intergovernmental agreement, it would be a different matter. But we certainly have deep antipathy to the proposals that are made about them in the Lisbon treaty.

As far as the arrest warrant is concerned, we opposed many aspects of it, principally because it was not possible, under the provisions, for individuals to use the defence of the European Convention on Human Rights. We continue to have those hesitations.

There is clearly written into the Extradition Act, which gives effect to the European arrest warrant, a defence of human rights.

That is most interesting to hear from the noble Lord, Lord Goodhart. My understanding is that it is not possible under the European arrest warrant, once all the formal stipulations are complied with under the provisions that set it up, to raise convention rights. That is my understanding.

The issue for us is that these measures will change the character of the European Union in an undesirable way and make it less likely to be the successful organisation that it was in its earlier years. I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

[Amendment No. 54 had been withdrawn from the Marshalled List.]

[Amendments Nos. 55 to 64 not moved.]

[Amendments Nos. 65 to 69 had been withdrawn from the Marshalled List.]

Before moving to resume the House, may I respectfully point out that we have two more days in Committee on this Bill. I therefore urge all noble Members present, and those who may be present on futures days of Committee, that it is best not to enter into extraneous arguments; we should focus on the amendments in question and not repeat arguments already made in Committee. With that, I beg to move that the House do now resume.

Moved accordingly, and, on Question, Motion agreed to.

House resumed.

House adjourned at 11.17 pm.