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European Union (Amendment) Bill

Volume 702: debated on Wednesday 4 June 2008

Consideration of amendments on Report resumed on Clause 2.

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

“(i) any provision that amends the position of President of the European Council unless the Secretary of State has laid, and undertakes to lay annually thereafter, a statement before Parliament, explaining the powers, duties and role of the President of the European Council, and(ii) ”

The noble Lord said: My Lords, this amendment deals with some loose ends, or even unanswered questions, that arose when we had an extensive debate in Committee on the broader questions of the proposed role of the new semi-permanent or, at least, longer-term President of the European Council. That debate became rather wider than some of us would have wished and turned into a general debate on different views about how Europe should progress. I seem to remember that it ended on a slightly sour note, so I hope that this debate can be shorter and sweeter.

This amendment would provide for an annual reporting process on the powers, duties and role of the President of the EU Council. I gather that some of these things have not been decided and perhaps cannot be decided yet, but it would be helpful to me, and perhaps to some other noble Lords, if we could have a little more thoughts and updates from the Minister on where discussions on the powers, duties and role of the president have got to. In the previous debate, a noble Lord reminded us that creating new positions and ensconcing individuals in them always has consequences and raises new questions about their continuation, power and so on. We are still not totally clear about what role this president will play and how he or she will interrelate with the rotating president, who will continue to be a national head of state. How will these two activities dovetail? When will the final decisions be taken on that and on other logistical matters that were raised in the previous debate but could not be answered at the time?

The Minister of State helpfully wrote to the noble Lord, Lord Grenfell, about what he called implementation issues. They involve matters that the Slovenian presidency is urging should be addressed while the process of ratification unfolds. They include a list of discussions on the Council presidency. I shall not detain noble Lords by reading them out because I think that the Minister will be familiar with them. With those few words, I ask that we now carry forward some of these issues and possibly tie up a few of the loose ends on this important role that is to be created should the Bill pass and the treaty be ratified. I beg to move.

My Lords, it would be interesting periodically to have a report on the development of all the institutions of the European Union, particularly where new roles are envisaged, but whether it should be a condition that it is necessary to fulfil before enactment of this legislation is something quite different.

Those who favour the view that the European Union should be primarily an intergovernmental organisation—that view has had a lot of support from the opposition Benches—should take considerable interest in seeing the role of the President of the Council developed, as the coherence and continuing effectiveness of the Council is part of the necessary condition of the European Union speaking with one voice in the councils of the world and a necessary condition simply of carrying forward the work of the Council from one session to the next. One of the great weaknesses has been the rotating presidency. The present Government—and the former Prime Minister, Mr Blair, in particular—have always recognised the desirability of this office continuing beyond the six-month pattern that has marked the arrangements to date.

It is, however, also clear that executive positions of this kind must be sufficiently flexibly defined to enable them to be occupied effectively by the incumbent and to play to that person’s strengths. This role should not be confined by detailed prescription from the Union members; rather, it should be allowed to develop in accordance with the aptitudes of the individual who occupies the role, bearing in mind the interplay with other Union leaders such as the high representative and the President of the Commission. In earlier debates on the Bill, concerns were expressed about the possibility of a single leader emerging to speak for the Union as a whole. That is no part of the provision of the treaty of Lisbon, which quite clearly strengthens the role of the President of the Council but also creates the much more influential double-hatted high representative, whose influence will therefore be considerably elevated in the conduct of foreign policy.

These things are all devised to enhance the effectiveness of the European Union, and whatever view one takes of the European Union—members of the Conservative Opposition have all protested their strong European credentials, which must indicate that they want the European Union to be effective and to speak with one voice when it participates in world organisations or seeks to advance the collective views of the whole—it is necessary to have leadership. Anything that underpins that in the treaty is welcome. I do not want the Government at this stage to go into great detail about how they anticipate that these roles might be discharged in the circumstances that lie ahead. The purpose of this constitution in broad terms is to provide room for manoeuvre. That is an important aspect of working constitutions.

We in this country have frequently taken satisfaction from the degree of flexibility in the powers of the Executive. Any attempt to define the precise role of the Prime Minister has to be linked to the period about which you are talking. The Prime Minister’s role has been exercised very differently even during the time of this Government: his role, relative to the committees of the Cabinet, has shifted depending on the Prime Minister. Similar arrangements and flexibility are highly desirable in this instance and I very much hope that the Leader of the House will not feel tempted to draw too tight a prescriptive role in this debate or, indeed, to crystal-ball-gaze on how it may all develop in the months ahead.

My Lords, I would argue a little differently, yet in the same sense as the noble Lord, Lord Maclennan, because to my mind this amendment is completely otiose. It states that the Secretary of State should,

“lay annually … a statement before Parliament, explaining the powers, duties and role of the President of the European Council”,

but all you have to do is open the treaty of Lisbon and you will find those powers, duties and role described there. Now, they may not be thought to be described sufficiently or in enough detail, but they are described in the treaty. It is perfectly clear, from the way in which European Union treaties are constructed, that if you wish to change those provisions, you need a new treaty and have to have the whole process of ratification again.

This amendment is completely otiose unless a rather elaborate interpretation is put on to “amends the position”, words that seem very slippery to me and capable of almost any interpretation by whoever wants to think of one. I do not know what they mean. This is all completely unnecessary, because if the European Union wishes to change,

“the powers, duties and role of the President of the European Council”,

it will have to amend the treaty of Lisbon.

My Lords, I take a completely different point of view from that of the noble Lord, Lord Maclennan, who says that at this stage he is not concerned about the detail. I would like to hear the Government’s point of view on how this new post will develop. It is essential that we should know exactly what the Government think about it. We have had various declarations from the previous Prime Minister—but not, I think, from the present one—who thought that the post of president of Europe was important and that it should be taken by somebody who spoke for Europe on the world stage. I do not know whether that is actually printed in the treaty; nevertheless, the view of our then Prime Minister was that the job would, in fact, be very important.

At present, there is no question about how the role of President of the Council works. Because it rotates every six months, there are, I believe, checks and balances built in and everybody is given a turn. That means that power is not concentrated on one person for a significant period. What worries me about the proposed presidency—whether we need a president at all is, of course, a different argument—is that this is how individuals and organisations get a power creep. The longer they go on, the more they like the job and the more power they wish to exercise. That power can be exercised only at the expense of the nation states, which has always been a worry to me. I hope that the noble Baroness will be able to tell me exactly how the Government see it—differently from me, probably, but I would like to hear it.

My Lords, I agree very much with the noble Lord, Lord Maclennan, that this is a good and positive treaty change in removing the rather outdated system of rolling presidencies and introducing a degree of continuity. It will ensure greater coherence in the overall management of the European Union in the years ahead, yet that role will, of course, evolve over time. It is difficult to say now exactly how it will be in two, three, four or five years’ time. It seems to me that that evolution is, indeed, a matter of importance to the functioning of the European Union and, therefore, of concern and interest to this House and to the other place.

However, it seems to me that the right way to track that evolution is through the regular reports that the Government and the Prime Minister will make after each meeting of the European Council, in which, as well as recording what has happened, I would hope that there would also be an analysis—six months by six months, or four months by four months—of how the institutional changes are evolving and how the role of the President of the European Council is evolving, too.

My Lords, the noble Lord has just made a speech that encapsulates why some of us object to the future of the European president being left to evolution within the European Union without the possibility of Parliament in this country being able to stop each one of those stages as the powers of the president move forward. I would like to support the amendment, but obviously it does not go far enough. If we are just going to be given a statement once a year from the Secretary of State telling us what has happened—somewhat inaccurately, I suggest, and somewhat low profile to what is really going on—it will not be enough. I point out to your Lordships—and I ask the Minister to disagree, if she does—that this will be yet another important instance where the octopus in Brussels gets a tentacle around the remains of our diminishing sovereignty. I speak with lukewarm support for the amendment and attempt to warn your Lordships of the inevitable progress of the ratchet of the salami slicer towards the European megastate that many of us fear.

My Lords, I am used to the noble Lord, Lord Pearson of Rannoch, describing everyone and everything European as corrupt and not worthy of any sort of trust. However, when, in his brief intervention, he assumes that the Secretary of State, when he gives a report after a European Council meeting, would do it “somewhat inaccurately”—I think that I quote him correctly—he casts an aspersion on our parliamentary system, which, on sober reflection, if the noble Lord is capable of it, he might want to withdraw.

My Lords, perhaps I may say to the noble Lord, Lord Pearson of Rannoch, that, without evolution, he would not be here. The noble Lord, Lord McNally, says that the noble Lord, Lord Pearson of Rannoch, is a creationist. I do not believe that. Evolution is a very important concept, not least because without it none of us would be here. It enables us to think about how we evolve and how we can develop ideas in their infancy that can help the functioning of any kind of institution, not least the European Union, for the future.

I take slight issue with my noble friend about how the noble Lord, Lord Pearson of Rannoch, has described those of us who support the European Union in a way that he does not. I know that the noble Lord has a very particular use of the word “Europhile”—I have joked with him about this—but I do not think that he has described us all as corrupt. I hope that my noble friend will forgive me again for, as he no doubt would describe it, being too kind to those with whom he disagrees fundamentally.

First, I should like to talk more about the detail of the purpose of the full-time President. Noble Lords will know that I described in Committee—I will not go into the detail—the importance and value that I attach to having someone who is able to be in position for a minimum of two and a half and, possibly, up to five years. I think that I previously have described the relationship, for example, of a key country, in the shape of Russia and President Putin. From 2000 to 2007, he had 16 meetings with the European Union with 16 heads of state. In Committee, I said that I was very concerned about continuity at the time of the development of those relationships. My argument would be that there is something quite fundamental about moving to a position where one is able to be in that position for longer.

Noble Lords will know that we move from the Slovenian presidency to the French presidency shortly, but President Sarkozy still will have to continue dealing with all the issues in France, as well as with the European Union presidency. I believe that we would get a better deal from having someone whose focus is on the European Union, particularly with 27 member states and with the issues that we described in Committee that are facing the European Union as well as those individual states. The principle of a President who can focus on the European Union is very important.

The specifics, which the noble Lord, Lord Stoddart, in particular, was concerned about, are contained within the consolidated treaties in Article 15. But let me put them on the record very briefly. First and foremost, the role of the President would be to chair and drive forward the work of the European Council. He or she would focus on those meetings, make sure that they are effective and responsive to member states, and take the agenda forward. He would ensure the preparation and continuity of the work of the European Council to take forward its agenda to make sure that its work is detailed, considered and is able to take decisions. He would endeavour to facilitate cohesion and consensus within the European Council; that is, the work behind the scenes.

Noble Lords know how important it is, before the set-piece debates, to ensure that the contributions and discussions of member states enable the meeting to have the greatest value. I never underestimate that. It will be the President’s role to present a report to the European Parliament after each meeting of the European Council, and to be the spokesperson, going into the European Parliament to explain what has happened. This is an important role—which the presidency would fulfil in any event—for somebody who can take that on and is able to deal with the European Parliament appropriately. The President would ensure the external representation of the European Union in a way that is complementary to the work of the high representative, but none the less recognises the important role of the President in common foreign and security policy issues.

The noble Lord, Lord Maclennan, spoke extremely articulately about the issue of flexibility; I agree with him completely. Designing a job, and a job description for any role, is, in part, about the person who will fulfil that role. Therefore, we are trying to make sure, in an evolutionary way, that we recognise that the person who fulfils this job will bring to it talent, expertise, knowledge and experience. This will ensure that they do the job efficiently, but will, in a sense, also determine the focus that they may have, working closely with the High Representative, who will bring different skills to that role. Therefore, we would be wrong to try to detail exactly what the role should be in a way that prevents somebody coming into that role making it their own. I give way.

My Lords, I am most grateful to the noble Baroness. Does she envisage the role of this new President of the European Union—because that is, I think we can all agree, what he will become known as—having the power to sign treaties, and does she see him receiving ambassadors? Has the noble Baroness got as far as that?

My Lords, I do not believe the President will be signing treaties. I make a distinction with the President of the Council. The noble Lord seeks to position this role in a different way for all sorts of reasons that I can imagine. It is a function that is performed on a six-monthly basis by the state that carries the presidency. It has become clear, over the years, that the rotating presidency has strengths and weaknesses. It is important to acknowledge where having somebody in position for longer can bring coherence and continuity to the European Union’s work. That is exactly what this is, and no more. The role is not meant to move us into a position that the noble Lord fears might arise. I can assure him of that.

There will be, as the noble Lord, Lord Howell, said, rotating team presidencies. There has been greater collaboration between the presidency in position, the previous presidency and the next presidency, so that there is a kind of triumvirate working more closely together to greater effect, in my experience, so that you get continuity running through decisions. That has been extremely effective for the presidency. They will chair the sectoral councils. The noble Lord will be familiar with ECOFIN and the Justice and Home Affairs Council. They will not chair the Foreign Affairs Council because, under the proposals, that will be chaired by the high representative. That will continue. There will be greater coherence and consistency because of the team presidencies that operate over 18 months. The experience of that has been that the agenda, although set within the presidency, is also linked to the presidency before and the presidency after. You have the three presidencies moving together. That has been a more effective way of moving forward.

The noble Lord, Lord Jay, asked about scrutiny, and how this would be brought to your Lordships’ attention. The Minister for Europe wrote to the noble Lord, Lord Grenfell, chair of the Scrutiny Committee, on 22 April. A copy of that letter has been laid in the Library, as noble Lords will have seen. It describes how the Government intend to keep Parliament involved. In that letter, the Government commit to ministerial contact with the Scrutiny Committee ahead of any decisions that might be taken to implement any of the issues concerned with this amendment. There will of course be an update before the June European Council, as noble Lords would expect.

I hesitate over the word “analysis” because I am not sure how to interpret it. The noble Lord, Lord Jay, will forgive me, but I want to think about it a little more. Underpinning what he said is the need to ensure that Parliament is kept informed of the development of this role. I am sure that within the context of regular reports to the committees, that will happen. Perhaps I may say in the presence of the noble Lord, Lord Grenfell, that it is not least because the committees are perfectly capable of requiring the Government to come forward and explain where we are in the process, how effective it has been, who is taking on the position, the functions to be undertaken and so forth.

I complete my response by saying that I do not believe the amendment is necessary because we already have the process in place. It will enhance the opportunities for the European Union to operate effectively, not least when talking to countries outside the Union. I hope, therefore, that the noble Lord will withdraw his amendment.

My Lords, I appreciate that this amendment has been received with less than total rapture by some noble Lords on all sides. As I made clear in moving it, I have brought it forward more in the spirit of seeking clarification. I confess that I remain uneasy and puzzled by some of the propositions before us. Of course presidencies evolve. The presidency of the United States has evolved in ways that make it vastly different from when the original constitution was drawn up. On the whole, however—I am not sure whether it is the case for the Philadelphia Constitution—constitutions tend to define the actual powers in relation to the legislature and other institutions of authority within a state and they tend to define the powers of the president. I do not want to get into an argument at this stage, although we will certainly get into an argument later, on whether this is a constitution because it has the same wording as what was called a constitution, although many people argue that that should not have been called a constitution either. Thereby springs many of our troubles. Nevertheless, this is an attempt to bring more coherence by one means or another, in this case by amending various treaties rather than putting around them the wrapping of a completely new treaty, and introducing various new positions and roles.

The noble Baroness says that the President will work in a way that is “complementary” to the High Representative. Should we not be asking a little more clearly who is going to be in charge on the foreign policy side? Foreign policy issues will come up in the Foreign Affairs Council; the president will be sitting in the general Council; the issue of the rotating president will have to be sorted out in ways that I am not clear about even now—but as the noble Baroness has said, it will have to be sorted out—and there will be, in her words, a “triumvirate” who will somehow clarify all these things. Perhaps we should just relax, as the noble Lord, Lord Maclennan, advises, and abandon any prescription so that the whole thing can evolve in various ways. However, we are a parliamentary democracy and we need to know where power lies and how it will be used. It would be an exception to the rule of the evolution of presidential roles, the transfer of powers and the creation of legal systems, which is what we are involved in, to leave the matter hanging in the air.

The noble Baroness has made an excellent fist of trying to describe things which, frankly, are not yet settled. We are half way through the cooking, as it were, and we do not know how the meal is going to turn out. That will leave a lot of parliamentarians a little uneasy and worried. But this is not a matter that can be settled here and now. Loose ends need to be tied up and further discussions are coming along. Perhaps this is not the moment to test the amendment and therefore I beg leave to withdraw it.

Amendment, by leave, withdrawn.

14: After Clause 3, insert the following new Clause—

“Cost-benefit analysis

(1) The Secretary of State shall lay before Parliament a report on—

(a) the economic costs and benefits to the United Kingdom of implementing the provisions of the Treaty of Lisbon, and(b) a comparison of the economic costs and benefits of the United Kingdom’s membership of the European Union before and after the implementation of the provisions of the Treaty of Lisbon.(2) Within one month of the laying of the report, a Minister of the Crown shall move a motion in each House of Parliament that the House approves the report.

(3) In subsection (2), the reference to “one month” does not include any period of time in which the House in question is dissolved, prorogued or in recess for a period of more than four days.”

The noble Lord said: My Lords, I fear that this amendment is yet another attempt to get the Government to carry out a detailed cost-benefit analysis of our membership of the European Union, and while we are at it, it would be nice to know if the Conservative Party has come round to the idea of supporting such an exercise.

Noble Lords may recall that I have introduced three Bills over recent years with the same aim, which we debated on 8 June last year, 27 June 2003 and 17 March 2000. This amendment is drawn somewhat more narrowly than those Bills in that it applies only to the economic costs and benefits of our EU membership, whereas they cover the cost to our sovereignty and powers of self-government as well.

The Government have always refused an official cost-benefit analysis on the wholly unjustified grounds that the benefits of our EU membership are so wondrous and obvious that it would be a waste of time. I expect that they will say the same thing tonight. However, the true and obvious reason why they refuse it is that they fear it would reveal the unacceptably high cost we bear from being in the European Union and the result would be so disastrous as to make their precious policy of staying in the EU untenable.

In the absence of such an official analysis there have been several respectable private academic studies over the past five years, which put the cost of our EU membership at anything between 5 and 10 per cent of GDP, or roughly some £50 billion to £100 billion per annum. All the studies agree that the main elements of cost are the higher price we pay for food as a result of the common agricultural policy, the hard cash we hand over annually to Brussels and the effect of EU overregulation.

If we accept the EU’s own figure for the latter—that is, overregulation alone—we come to some 6.5 per cent of GDP, which has been estimated by the Competition Commissioner Günter Verheugen. If we accept that, we are at the top end of the studies that I have mentioned. It probably is the dead hand of Brussels bureaucracy that causes most of the harm, especially when compared with the new free economies of the East. One thinks of such tragedies as the decimation of our fishing industry, the flight of our art market to New York and Geneva and the impending damage to the City of London caused by the EU’s financial services action plan.

It is not just swivel-eyed British Eurosceptics who suggest that the EU membership is hugely expensive. Only last week in Ireland, Mr McCready, the commissioner, admitted that some 80 per cent of all legislation now affecting British businesses comes from the European Union.

My Lords, is the noble Lord seriously saying that the City of London does not benefit from the common market and financial services created by the EU? I assure him that British financial services organisations and those international companies based in London are full participants in the work of creating the legislation under the financial services action plan. I see heads nodding, but there are some people who try to dissent. The overwhelming view of the City of London and the Corporation of London is that the EU single market has been a great advantage to British financial services.

My Lords, I should point out to the noble Baroness that the head, which was being shaken, not nodded, was that of the noble Lord, Lord Blackwell, who has certain experience in these matters, as do I. I have spent my life in the City of London in the real marketplace; I do not believe that the same is true of the noble Baroness.

If noble Lords are in any doubt about this, they should take the trouble to read the publication by Open Europe, a mildly Eurosceptic organisation, entitled Selling the City Short? A Review of the EU’s Financial Services Action Plan. That document details that the mere cost of transposing these directives into British law will be some £23 billion over the next four years. It does not attempt to quantify the damage that will be done to the City of London when practitioners, particularly in the wholesale markets, vacate the City of London for New York, Singapore, Dubai and elsewhere. So I must answer the noble Baroness: yes, I do mean that. I mean that the financial services action plan looks to me, as far as I can see at the moment, as though it will destroy the City of London and the benefit which that confers on this country.

My Lords, perhaps I may intervene again because the noble Lord made a personal remark to the effect that I obviously know nothing of what I was talking about. I spent the second half of the 1980s working in the City, first for Lloyd’s of London and then for American Express Europe; so I did work in financial services. The EU has been a great benefit to the London insurance market. Having worked for an American international company, I know that it took full advantage of the EU. So I do know a little bit about financial services.

My Lords, I accept that the noble Baroness knows a little bit about financial services. I apologise if in any way I have impugned her reputation in this regard.

I had started saying that it is not just us British Eurosceptics who suggest that EU membership is hugely expensive. I mentioned Mr McCreevy, who last week, in Dublin I think, admitted that 80 per cent of all legislation affecting our commerce and industry comes from Brussels. We know what that means in terms of overregulation. I would quote to your Lordships the Swiss Government, who last year calculated officially that EU membership for Switzerland would be nine times more expensive than their present bilateral arrangements. There is really no reason to believe that a different calculation would apply to the British economy. We are in many ways similar to the Swiss economy, although we are of course bigger.

I think that I have mentioned to your Lordships the study carried out by the top French think tank, the Conseil d’Analyse Economique, which reports directly to the French Prime Minister and has recently estimated that neither the single market nor the euro have done anything for the French economy. One has to ask: why should that be so different here?

I could go on, but I trust that that is enough at the moment to suggest that our membership of the European Union is extremely expensive economically. And to all this the Government now give two answers, both of which are clearly wrong. First, they say that millions of jobs are created by our EU membership, thus implying that were we to leave the EU millions of jobs would be lost. This is clearly nonsense because the jobs are created by our trade with our clients all over Europe, not by our political subservience to Brussels. If we left the political construct of the EU, that trade would continue, especially as we are the EU's largest client. It sells us much more than we sell it. I trust the experiences of the noble Baroness, Lady Ludford, in the City, will lead her to agree with that point.

It is probably true that about 10 per cent of our jobs, some 3 million, do support our trade with the European Union, but none of them would be lost if we left the EU and continued in free trade with our friends across the channel. That is also part of the answer to the noble Baroness, Lady Ludford. What advantages have we had by our political subservience to Brussels that we could not have had by open and simple free trade with our friends in Europe?

We must not forget that EU regulation stifles 100 per cent of our economy, including the 90 per cent which does not trade with Europe. No serious calculation has been made of the number of jobs which might be created if that 90 per cent were set free from EU red tape to trade on more level terms in the vibrant new economies of the east. That calculation should be done and it should be part of the analysis which this amendment proposes. Whichever way you look at it, it is reasonable to claim that jobs would be created, not lost, if we left the political construct of the European Union and continued in free trade with our clients and friends in Europe.

The other stock answer given by the Government to justify our continued membership of the European Union avoids its cost altogether. The Prime Minister has recently started to say that our membership is not necessarily an economic matter. Perhaps this was inspired by his time at the Treasury, which in October 2005 issued a report chiding Brussels for its overregulation and putting the cost of our membership as perhaps as high as 28 per cent of GDP. That Treasury report included 12 per cent for increasing competition within the euro area to US levels, and 7 per cent for the cost of EU food under the CAP. Both those percentages are considerably higher than in the independent studies to which I have referred. So the Government’s second stock answer appears to have become that however much the EU may cost our economy, it is worth it because as members we construct the world stage as part of a large bloc and therefore have more influence than if we had retained our independence. This line has been strongly supported by noble Lords who can only be described as leading members of the “international conference-ariat”, to coin a new phrase. From Second Reading and Committee I would mention the noble Lords, Lord Ashdown and Lord Robertson of Port Ellen, in that context, and other noble Lords come to mind, mostly our several noble former employees of the European Union.

My Lords, I shall be very short. I thank the noble Lord for giving way. Would he try and play the game and not the man? It would be a great help if he would stop that nonsense.

My Lords, the noble Lord provokes me. The game is made up of the men. I was not going to remind noble Lords in receipt of an EU pension of the unanimous judgment of the noble and learned Lord, Lord Woolf, and his committee on Members’ interests that EU pensions should be declared in debate. I was not going to mention that at all.

My Lords, once and for all, would the noble Lord grasp that I do not receive a pension from the European Community? I never have and I do not now. So would he please withdraw that remark?

My Lords, I am not sure that I said that the noble Lord did personally receive a pension from the European Community but several noble EU pensioners—about 11 by my calculation—contributed forcefully at Second Reading and in Committee. Only one—the noble Lord, Lord Williamson, who, I regret to see, is not in his place—to his great credit has declared that interest. Of course I am aware that our Committee for Privileges, most unusually, did not share the judgment of the noble and learned Lord, Lord Woolf. We debated the matter on 19 July 2007. Any noble Lord who is not familiar with this subject should perhaps read that debate. The point is that EU pensions are rare, perhaps even unique, because they can be forfeited if the holders go against the interests of the European Union, even many years after they have left. Anyway, that is enough on EU pensions.

I said that I did not want to bring that in, my Lords, but I was provoked.

We appear to be dealing with a new class of people. The best phrase I can think of to describe them is an “international conference-ariat”. They go to conferences all over the world at our expense, very comfortably, to places like Bali to talk about climate change; not that that makes any difference, or that anything we do will make any difference. The line of this new conference-ariat is that we increase our sovereignty by surrendering it. For the United Kingdom’s voice to be heard in this globalising world, they say, we must give up our right to govern ourselves and abandon our special relationship with the United States of America for the delights of the French-inspired European army. That is nonsense.

My Lords, the British people would like to know how much this madness is costing us in cash. I beg to move.

My Lords, before the noble Lord sits down, I was very familiar with much of his argument; indeed, wearyingly so. However, one thing was new to me and I did not entirely understand it. He spoke of the “free economies of the east”. Can he tell us which these are? Does he mean Poland and Slovakia, in which case they are members of the European Union? Does he means the Russian economy, which is free, after all, of the World Trade Organisation and, indeed, of law and regulation as such? Does he mean the Chinese economy, which is free of any democratic accountability? Which are the “free economies of the east” that he admires so much?

My Lords, I trust that it was clear that I meant free in the sense that they were unburdened by the EU’s overregulation and thus not handicapped by it.

Yes, my Lords: I meant India, China and Russia. I meant where the money is on the planet today. They have the money, and we have the debt. If we are not free to trade with other nations of this world on level terms, at least, we will live to regret it. As we side more and more with the European Union, we will become, as an American senator friend of mine said to me last week, a little old antique shop in Europe. The Americans’ interests lie in the east; that is the east I referred to. I am surprised that the noble Lord, Lord Wallace, cannot grasp it.

My Lords, there are some sad occasions in this House, even during the passage of the European Union (Amendment) Bill. There should not be, really, as it should be a very jolly occasion looking forward to the treaty coming into force if the Bill passes all its stages. However, I hope that the noble Lord, Lord Pearson, will not be offended if I say that that was like a Captain Queeg performance from him, if you remember The Caine Mutiny. These obsessive neuroses about the evil, wicked effect of European Union membership on member states, particularly Britain, are really going too far.

I presume the majority of eurofacts, the magazine of UKIP, is written by the noble Lord, Lord Pearson, himself; I do not know. The front page of the latest edition has a leading article saying that the European Commission is preparing a directive to prohibit people in any member state from criticising the European Union. They are apparently at work on measures to prevent the burning of the flag. I do not know who wants to burn the European flag anyway, but this was actually raised in Committee on this Bill a few weeks ago. I mean—

My Lords, I am very relieved to hear that, as I thought that the noble Viscount was about to refer to the Companion and chastise me for saying something improper, although I could not work out what it was.

My Lords, I am advised that I did remember the magic words. However, I trust that we can take the pearls of wisdom cast by the noble Lord, Lord Dykes, thus far as read and that he may continue with his peroration.

My Lords, for once I can agree with the noble Lord, Lord Pearson. I thought that I heard him say, “I beg to move”, but the tone dropped at that point because he obviously realised that he was losing the argument. His speech was yet a further rerun of the old examples that we heard in Committee—yet another repeat of wicked effects. Our membership of the European Union goes much wider than just an analysis of facts and figures, although those are very important. We on these Benches believe that the economic benefits to this country of our membership of the European Union are tremendous, have provided us with enormous new opportunities and created more than 3 million new jobs directly arising from our activity in the European Union, which would not have been possible without the creation of the single market and the greater export opportunities that have arisen from that.

I referred to the enlightened magazine, eurofacts, with all its tirades and diatribes. Usually it refers to an extra sinister effect of the latest proposal, which is that the first country that proposed it was Germany. Contributors to eurofacts love to repeat that because it recalls echoes of the past. It is all complete rubbish. It is very sad that this is the only member state where this kind of debate is taking place. The amendment again asks for a cost-benefit analysis. One realises how shallow these arguments are.

Since we are talking about facts and figures, I remind your Lordships that in 2006 the gross UK contribution to the EU budget totalled £12.4 billion overall. We should deduct the UK abatement that we get from our unique and special privilege of the rebate. No other member state gets this. All the other member states thought that it would last for a certain number of years. They did not realise that it would carry on many years after its inception. If we take away the UK abatement of £3.6 billion and the public sector receipts of £4.9 billion that we get directly as a result of our adhesion to the European Union, the net UK contribution to the EU budget is £3.9 billion. I think that I am right in saying that the figure for Germany is probably approaching £8 billion as a direct comparison. I am happy to be corrected on that by other noble Lords, as I have not had time to look up the latest figure. In fact, in Committee the noble Lord, Lord Williamson of Horton, referred to these comparisons and said:

“The UK operating budgetary balance on this basis”—

the basis of his calculation with the budget rebate—

“is €2.143 million. We are 10th in the list of countries expressed as a percentage of gross national income. France, for example, contributes €3,017.8 million, which is 0.17 per cent of gross national income”.—[Official Report, 20/5/08; col. 1444.]

You can bandy these figures about to make any point, but they show that our membership of the European Union has been obtained on the basis of a very reasonable price given all the things that we get back—for example, the huge power that each member state gets from its collective membership of the Union of 27 members.

I object to the endless repetition of certain statements on the part of the noble Lord, Lord Pearson. He referred to his three Bills. I am happy to be corrected if I am wrong but, speaking from memory, I think that he initiated a Second Reading debate on the Bill that he introduced in 2007 but did not take it into Committee, as is his habit. Why not send it down to the other place to see what Members there think about it? Mr William Cash, David Heathcoat-Amory and the new UKIP Member of Parliament could have a field day discussing it. But no, the Bills are always taken just to Second Reading, so the effect is always the drip, drip of this tedious and inaccurate propaganda about the wicked disutility of our membership of the European Union. I think that I am right that on two previous occasions he took his Bill just to Second Reading, whereas most Members who have a Bill in this House seek to get it quickly into Committee so that it can go down to the other place and get a hearing there, which is of course far harder.

My Lords, as the noble Lord labours this point, he will find that the first of those Bills went into Committee here. It is true that the other two Bills did not. There was no point in continuing with the Bills, because as soon as they got to the House of Commons it would have taken only one unfortunate Member of the noble Lord’s party to block them. None of these Bills would have made any progress in the House of Commons. The object of the exercise here was to have a debate on this subject. We have had three now and I have yet to hear the noble Lord respond to any points made in those debates.

My Lords, we are in danger of lapsing into a Committee stage debate. I am grateful that noble Lords are trying to stay within the rules, but can we try very hard to observe them?

My Lords, I will take the sagacious advice of the Lord President and proceed with what were supposed to be very brief remarks. I detect that the Government feel that the Lisbon treaty is in the interests of Britain and of the European Union, in every way that has been explained at previous stages of this Bill, including Second Reading. It provides acceptable, rational adjustments to the operating procedures inside the Union that allow the EU to function more effectively with a much larger number of states. That is the common-sense aspect of what we are talking about. It again goes beyond costs and benefits.

The benefits are also strong emotionally and psychologically in terms of the public’s increasing acceptance of the natural state—the common-sense, routine, even mundane basis—of our membership of the European Union. On an everyday basis, the public are ahead of the politicians. They may not have detailed knowledge of every aspect of what is a very complicated scenario. None the less, in natural ways—with people moving with their families and children, or retiring to other European countries as part of a general diaspora—the mobility of populations within the Union is much higher than mobility in the United States, which was always given as an example of a high-mobility country in comparison with the sluggish population movements of European countries. That era has now passed. This is the modern European Union of the future, where younger members of the population in particular are extremely keen, in a natural, practical sense, about what they can do and the opportunities that they have of being members and citizens of the whole Union and not just loyal and patriotic members of their own sovereign member states.

We will certainly agree with the Government if, as I hope, they assert again that the benefits of EU membership far outweigh the costs and make completely nonsensical the arguments of the noble Lord, Lord Pearson, and his colleagues. Jobs, peace and security together mean a massive amount to a continent that was riven by horrendous conflicts in the days when France and Germany hated each other with a visceral hatred that had to be felt to be believed. One of the great stories of post-war Europe is the reconciliation of France and Germany, leading to the basis of a strong European Union. They invited Britain to join at that stage and we foolishly said that we did not want to. Lest this revert to a Committee stage debate, which would be reprehensible—and I do not want to make this a Second Reading speech—I conclude by saying that I hope that the House will reject decisively this ridiculous amendment.

My Lords, I do not want to speak for long on this issue, but the noble Lord, Lord Dykes, has brought me to my feet. He told the House that this was the only country where this sort of debate takes place. Well, he is wrong. In Denmark, there are frequent debates, and indeed referendums, on the important issues in treaties. In Sweden, there is an argument going on, with a threat from the trade unions that, unless the Swedish Government can deal with a wages problem that has been caused by a ruling of the European Court, they will be against the Lisbon treaty. When I was in Estonia some while ago, I did not get the impression that there was no dispute about membership of the European Union in that country.

We are not alone in querying our membership of the European Union and its cost and benefits; that is the sensible thing to do. In any event, if we were the only ones doing so, why not? Let us not make any mistake about the fact that we are different in many respects, probably most of all because we are an island that has been successful over a long, long time—much longer than any other European state, except perhaps France. It is perfectly in order for us to have such a debate. Indeed, it is a recommendation of our democracy that we have such debates.

I say to the noble Lord, Lord Dykes, and to the Liberal party that I can respect their position. There is no doubt that their position is that we should have in Europe a fully federal state. That is a perfectly respectable view to hold and I do not criticise them for it, but they must allow other people to have a different point of view. I have a different point of view, which I have held for a very long time.

On the cost-benefit analysis, other parties, unlike the Liberal party, say that it is about trading. They say that it is not about a country called Europe, although I believe that eventually it will be, and the Lisbon treaty takes us another big step towards that. If it is about trading, and if it is about the benefits to the British people, it is sensible for the country to have regular cost-benefit analyses. If the Government do not do that, they are not properly serving their people and indeed they are cheating their people. Therefore, the suggestion that is being put forward by the noble Lord, Lord Pearson, is sensible and should be accepted by the Government. The noble Lord pointed out that the Prime Minister, when he was Chancellor of the Exchequer, produced a paper that showed that our membership of the European Union, in economic terms, cost us £28 billion a year. That being so, I would have thought that the Government would want to look at it to see whether that figure could be reduced and whether the books could be better balanced.

On the question of our net contribution, I am not at all sure that the noble Lord, Lord Dykes, got his figures right. The last figure that I saw was that the present net contribution was £4.5 billion but would rise by 2010 to £6.2 billion. If you add the £3.5 billion rebate that we get at present and which we would perhaps lose if the noble Lord, Lord Dykes, had his way, the net contribution would be £9.7 billion a year. That would exceed that of Germany and make us the highest contributor in net terms to the budget of the European Union.

Then let us take trade. That was the basis on which we went into what was then called the Common Market. Last year the deficit in trade was £40 billion, rising from £32 billion in 2006. That is an enormous gap in trade and loses the country jobs. With a proper cost-benefit analysis to try to correct that situation, far from losing jobs we might gain them. Then there is the cost to the consumer, estimated by the Treasury to be £20 per week per family. That cost ought to be taken into account for the sake of the families in this country, whom the Government ought to be protecting.

Finally, if this is really about trade, there are many good places to trade with other than Europe and without having the trappings of a full-blown state—a president, foreign minister, Parliament, currency and goodness knows what. I recommend the House sometimes to agree with the noble Lord, Lord Pearson, and indeed with me that this is too important a matter just to be left to the economic superstition that it is good for us. We ought to have a cost-benefit analysis. It would be beneficial to the country and make a contribution to the good debates that we have in this House about our membership of the EU.

My Lords, I support my noble friend Lord Pearson on this amendment. I do not understand why the noble Lord, Lord Dykes, is so against it. If our membership is so self-evidently beneficial, surely he should welcome a cost-benefit analysis that would demonstrate that conclusively and once and for all to the British public, so lancing the boil. There would be nothing to worry about. I do not know why our Europhile colleagues are so nervous or so against having a cost-benefit analysis. This would help them if they are sure of their facts. If our contributions, which the noble Lord, Lord Stoddart, has analysed so carefully, are so minor, our Europhile colleagues should welcome a cost-benefit analysis. I cannot see the problem at all.

Let me pick up on one or two things. The noble Lord, Lord Dykes, quoted from eurofacts. I claim some credit for his assiduous reading of eurofacts because I think that I sent it to him as a Christmas present last year. I have yet to receive a thank-you letter; I am a little disappointed by that. Of course it is essential reading. If Europhile noble Lords have time, when they are not busy excoriating the Murdochite press, they will find that eurofacts is correct—it is Eurofactual. The noble Lord, Lord Wallace, will recognise that. He took great pleasure in Committee in rubbishing an allegedly fictitious story that the European Commission was going to regulate fortune-tellers and spiritualists. He had terrific fun with that. Actually, as noble Lords will know, because we have circulated the report, the story was true. The noble Lord should be a little more careful about what he says when he affects to rubbish the stories in eurofacts.

I am quite sure that at some point the Commission or European Parliament will come forward with a proposal to make it more difficult for parties such as UKIP or any other Eurosceptic party to have a say. Indeed, that is already happening. They are going to be cut out from funding unless they have a certain number of representatives. So I advise noble Lords to be a little bit careful and to concentrate on the Murdoch press rather than on eurofacts.

My noble friend Lord Pearson has made the arguments conclusively and the noble Lord, Lord Stoddart, has backed them up. I prefer to look at our gross contribution to the EU, which I think is now £12 billion or £14 billion. It moves all the time and it is increasing. We should look at the gross figure. If one pays tax, one does not say, “I am actually paying 20 per cent, but I only pay 8 per cent because I have roads and policing”; one says, “I am paying 20 per cent tax”. Apart from our rebate, the returns that we get, as mentioned by the noble Lord, Lord Dykes, have Euro Commission labels telling us on what we should spend the money. Our money goes to Europe and comes back with a label on it telling us how to spend it. I hope that we look at our gross contribution in the future. The noble Baroness may tell us that it is about £14 billion and likely to increase.

Finally, we are often told by our Europhile friends that this is a club and that if you become a member of a club you have to pay your dues for your membership. Of course, that is absolutely right. However, if you are a member of a club, you look at your membership dues annually—at least I certainly do—and you review them; you see what the advantages are of your membership of the club; you look at who your fellow members are; you look at what advantage you get from membership and what services you get; and you look at whether your subscription gives you value for money. That is all that my noble friend Lord Pearson, the noble Lord, Lord Stoddart, and I want; we want to see whether our subscription to the Euro club is worth it. The people of this country also want to know whether it is worth it.

At one point, the noble Lord, Lord Maclennan, said that there is a groundswell towards Europe and the noble Lord, Lord Dykes, said that there is a swing towards Europe. I do not know what world they inhabit, as any poll will show that people are increasingly sceptical about our membership of the European Union. I let that pass, as it is a matter for debate and polls can swing one way or the other. Certainly no poll that I have seen over the past five to 10 years has said that we want more Europe, which is what this treaty gives us. I believe that my noble friend’s amendment is valuable and will be useful to the general debate outside the Westminster bubble. I strongly support the amendment.

My Lords, the problem with an amendment like this is that the words “cost-benefit analysis” sound very factual. In fact they are very pseudo factual. You would need to do a complete study of what you included as a cost and what you perceived to be a benefit. If I were to do a cost-benefit analysis, I would, for example, want to look at how much the buttressing of democracies in Spain and Portugal during the 1970s and 1980s saved us on the NATO budget in strengthening the southern flank of NATO. I would want to look at how the investment that was made in Greece, following the colonels, buttressed that country's democracy and saved us massive expenditure which otherwise would have been put into our defence budget. Similarly, you can look at what is happening in the Balkans at the moment and at what has been happening in eastern Europe and the process leading to accession there. That sort of cost-benefit analysis is the analysis of people who pretend that they know the cost of everything but know the value of nothing.

My brief point of fact is in relation to something that the noble Lord, Lord Stoddart, said when he referred to this movement in Sweden that was leading to a rebellion against the ratification of the treaty. I happened to be in Sweden the week before last visiting the Swedish Parliament. I spent some time in the Rikstad listening to some of the discussion. I heard the debate on the Alpha Laval case, which has been referred to the European Court of Justice. Although there is serious concern about the case, I did not hear one speaker from any party—the government coalition, the social democrats, the greens or the communists—in any way link this discussion to the ratification of the treaty of Lisbon, which they will be dealing with in the Swedish Parliament this autumn. It is assumed by everyone there that the Swedish Parliament will overwhelmingly ratify the treaty of Lisbon.

My Lords, before the noble Lord sits down, I am sure he will recall, or, at least, he will see when he reads Hansard, that I referred to the trade union movement, not the Parliament.

My Lords, I shall pretend that I had not sat down in response to that because that is a rather naive intervention since it is not the trade unions that will be ratifying the treaty of Lisbon. It will be a process of parliamentary ratification in exactly the same way as it is here. It is not a referendum outside Parliament, and there can be no doubt that the treaty of Lisbon will be ratified in Sweden.

My Lords, this has been, as ever, an interesting debate. I am grateful to all noble Lords who have spoken. I think it could be rather a jolly occasion, despite the concerns of the noble Lord, Lord Dykes. I begin where my noble friend left off, which is with the issue of cost-benefit analysis, and not least with what one describes as a cost and what one describes as a benefit. I fear that no cost-benefit analysis the Government could do would satisfy the noble Lord, Lord Pearson of Rannoch, in its interpretation.

In rejecting the amendment on the grounds that we do not believe this would be a good use of government time or resources and we see no value in it, we are mindful of ensuring that we know exactly where we are in the European Union and are very clear in our desire to recognise the importance for the interests of this country in being part of it. The noble Lord referred to the cost in terms of the contribution to the European Union budget. I say to the noble Lord, Lord Willoughby de Broke, that it is indeed £12.4 billion. We get a £3.6 billion abatement and public sector receipts of £4.9 billion, so the net contribution to the EU budget is £3.9 billion. I hope those figures will alleviate any concerns the noble Lord might have about understanding precisely what the budget does.

I hesitate to reiterate much of what has been said about the benefits of membership of the European Union. As far as this Government are concerned, EU membership is central to the pursuit of stability, growth and employment. It is clearly in our national interest, both economically and in a wider political and strategic context. It has brought benefits in jobs, peace and security. Through it, we belong to the world’s largest trading block with a single market of over 490 million people. Half our trade is now within the EU, and we estimate that about 3.5 million British jobs are linked to it, directly and indirectly. Fifty-seven per cent of total British trade in goods is with the EU, 62 per cent of our total exports go to the EU and British investments in the EU totalled £17 billion in 2005, the last year for which I have detailed figures.

As noble Lords will know, I feel very strongly that membership is not only about the rights of British companies to buy and sell across the single market, but that it also allows our citizens to work, study, live and travel in the European Union and to receive free medical care if they fall sick. Improved maternity pay, the right to paid holidays and the reduction in the cost of mobile phone calls when abroad are just some of the practical benefits we have by being part of the European Union.

We benefit as consumers from being part of the Union. The EU outlaws price fixing and stops companies agreeing with each other to restrict competition. Cartels in industries as diverse as vitamins, banking, airlines and energy have been targeted by the European Union in recent years to ensure that the benefits are passed on to consumers. British firms benefit significantly from the enlargement of the EU: exports to the 10 countries that joined in 2004 rose from £4.66 billion in 2004 to almost £8 billion in 2006.

Our view is that these benefits would be unlikely to be available to the UK on the same, or even more favourable terms, if we left the European Union. If we left, we would be subject to customs controls and we would need export certificates. The abolition of customs duties already saves British businesses about £135 million a year. Our agricultural exports would be subject to tariffs that would be payable on some of our goods. There is a host of reasons why this would not work.

Just for completeness, there have been suggestions that perhaps what we should do is negotiate some access to the single market from the outside in the way that Norway and Switzerland have done. I begin from the premise that we are not Norway or Switzerland. We are one of the largest economies in the world. We have a bigger, more diverse economy, and we should be clear that if we tried to negotiate on that basis, we would have to accept many of the laws that already govern the operation of the single market, which is what Norway and Switzerland do. Norway accepts 85 per cent of single-market legislation. We would not, however, be part of the negotiations that determined what those laws would be. Moreover, we might have to contribute to the EU budget. Norway is a net contributor to the EU budget. The difference, as I have already indicated from the figures, is that we get a lot of money back from the European Union. As an EEA member outside it, we would not.

In essence, for all the reasons that I have given and for all the reasons that noble Lords know about—the benefits for citizens, and the co-operation, which we talked about earlier, on asylum, on counterterrorism, on illegal migration, on serious organised crime and so on; I could go on at length—we believe that being part of the European Union is extremely important. We hope, on that basis, that the noble Lord will withdraw his amendment.

My Lords, I am most grateful to all noble Lords who have spoken, particularly to those who have supported the amendment. It is strange, is it not, that the Conservative Party does not have a view on it? It would have been interesting to hear that. Does it think that a cost-benefit analysis of our EU membership would be helpful, a good thing? Does it agree with the Leader of the House, or does it simply not know? I imagine that our rules of procedure do not allow the Conservative Front Bench to intervene now, so I suppose we will just have to continue in ignorance of its position.

As to the contributions that have been made, I take issue with the noble Lord, Lord Dykes, who was somewhat overcritical of eurofacts magazine, which is one of the shining lights of truth and reason in the whole debate about our membership of the European Union. The noble Lord suggested that I had written most of it. I stand to be corrected. I may have written one article some time in the past 10 years, but I am ashamed to say that I have not written more, because I would like to be more associated with this truly significant publication.

The noble Lord, Lord Dykes, and others who objected to the amendment trotted out—I am afraid I have to use that expression—the usual Europhile line, as I said they would in my introductory remarks, that membership is hugely beneficial. He even dropped a clanger when he suggested that 3 million jobs depend on our membership of the European Union as opposed to our trade with it, which is a very different thing. He wisely said that a number of figures are being bandied about, although he put the net cost of our membership in 2006 at £3.9 billion, which was not all that far from the figure of the noble Lord, Lord Stoddart, of £4.5 billion. If these figures are being bandied about, why do we not earth them? I assure the noble Lord, Lord Dykes, and the Leader of the House, who suggested otherwise that my friends and I would of course accept an unbiased cost-benefit analysis of our membership of the European Union.

I am afraid that the noble Lord, Lord Dykes, also produced the old canard that the European Union has brought us jobs, peace and security. He is presumably not prepared to consider the suggestion that that is an emperor with no clothes. I have dealt with the jobs. We owe peace and security to NATO and our friends, the United States of America, since the end of the last war. He thinks that youth is swinging towards the European Union, but opinion polls show that youth is actually swinging away from it. The most Eurosceptic sector of British society is the 18 to 25 year-old group, according to many present polls. Whether noble and Europhile Lords like it or not, there is no European Demos. There cannot, therefore, be any European democracy—not for a very long time, or long after this project has failed, as it surely will.

The noble Lord, Lord Tomlinson, produced the line that the value of Spain, Portugal, Greece and others joining the European Union and getting rid of their dictatorships is unquantifiable because of the money we have thus saved by not having to support NATO, and so on. That is a difficult debate, but there is of course no reason why any cost-benefit analysis should not look at and pay due credit to it. It is likewise for the new countries of eastern Europe, who owe their membership of the European Union more to the interest of their political classes—many of whom went to work in Brussels, and all on the Brussels pay scale at 10 times their former salaries—than to the real, informed opinion of their peoples.

I come to the noble Baroness the Leader of the House, who I am afraid produced again the only line that she can—that the benefits are overwhelming. We had jobs, again: peace and security, we got all of that. We had an estimate of the net £3.9 billion but, as my noble friend Lord Willoughby de Broke said, that is not the point. The gross is the point: we pay £12.4 billion gross a year, according to her, to this absurd arrangement that is then filtered through Brussels. Some of that is given back to us, not on projects that we would necessarily choose, but always on projects designed to enhance the reputation of the project.

I am afraid that I do not have time to take detailed issue with the noble Baroness on some of the statistics she produced. She says that half our trade is with the European Union; that is what the Europhilic establishment tends to say, but it is of course not true. She means that it is, I am afraid, somewhat less than half of our exports of manufactured goods. If we take the whole of the economy—the export of manufactured goods, our services and transfers, and the return on our investments worldwide—it is acknowledged that around 10 per cent of the British economy trades with its clients in the European Union, some other 10 per cent trades with the rest of the world, and 80 per cent stays right here in the domestic economy. It really is not fair, then, to produce these bland, unchecked and unquantified statements. This amendment tries to quantify them; it would be really reasonable to do that.

When I mention Switzerland, the noble Baroness replies that it is not reasonable to suggest that the benefits that Switzerland gets from staying out of the European Union—it is not in the European Economic Area, unlike Norway, or part of the fax economy—would be very similar to those that we could expect. We could do even better because, as she says, we are bigger. As a bigger client of the European Union, we could clearly do better.

Finally, I must ask the Minister: what benefits have we had in any matter she has mentioned, from our membership of the European Union, which we could not have had from simple free trade and friendly collaboration with our neighbours across the Channel? That is a question that needs to be answered, and one which this amendment sought to answer. However, time is moving on and I cannot imagine that your Lordships wish me to divide the House, so I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

[Amendment No. 15 had been retabled as Amendment No. 26.]

Clause 6 [Parliamentary control of decisions]:

16: Clause 6, page 2, line 39, leave out from “Crown” to end of line 41 and insert “shall vote against or otherwise reject a decision under any of the following unless Parliamentary approval has been given by Act of Parliament—”

The noble Lord said: My Lords, I used to think sometimes, especially late at night—having attended, over the years, hundreds, if not thousands, of meetings concerned with European affairs—that the stronger pro-integrationist, European federalist case would eventually sink itself in its own verbosity. I have to say that after the past half an hour or so, I feel that the anti-European case might also sink itself in its own verbosity. I hope that we can now focus on a particularly important issue, although it is a late hour. It is a matter that we covered to some extent in rather a hurried way in Committee, but it is one to which we should now turn maximum attention because some very important issues are at stake.

The issue is how our Parliament is to deal with and to address matters of treaty changes that come through the passerelle arrangements. We know that there are passerelle arrangements in past treaties and that in this treaty there are some that require the approval of Parliament. But there are also the new provisions which do not require the approval of Parliament, so treaty changes can be made without that. The Government have met that by suggesting there should be debates in, and the approval of, both Houses before such treaty changes are validated. We have said that that is not enough.

The amendment was moved in the other place, not I think by a Member of our Front Bench, but by a Back-Bencher, and it was heavily supported by other parties, including the Liberal Democrats, whose leader, deputy leader and Chief Whip voted for it, and many others as well. So I live in hope—I shall probably be frustrated—that we might get a little support for the amendment, although it is a late hour.

It is important to emphasise that we are dealing with matters which can—they do not necessarily always— involve the transfers of powers away from national Parliaments and changes in the treaty. During our debate, a number of strange, slightly mysterious aspects arose. The noble Baroness spoke at considerable length and in great detail about how these kinds of changes should be handled. She said:

“I argue that what matters is that Parliament has appropriate and proper debate, but I do not believe that that is always possible within an Act of Parliament”.—[Official Report, 19/5/08; col. 1341.]

That was her view, which—obviously—is not ours.

Then we got on to a discussion of which, frankly, I do not understand every word. I hope that the noble Baroness will be able to explain it more fully. She said:

“More importantly, the conventions that would normally apply to secondary legislation, statutory instruments, and the votes and debates with which noble Lords concern themselves in relation to primary legislation—traditions and conventions that we might not vote against something—do not apply in this context. In the words of the parliamentary counsel whom I consulted this morning, this is a new power. It is different”.—[Official Report, 19/5/08; col. 1342.]

We have to ask what that new power is. When we talk about powers, we usually talk about Acts of Parliament to validate and give credence to them. Can we please be more clear about this new power to be given to your Lordships’ House?

The difficulty here is that our amendment is not specifically about your Lordships' House. It is about Parliament and the role of both Houses, including the other place, in addressing these possible changes in the treaty. Although it is very interesting to hear the noble Baroness’s views about how things might change in your Lordships' House, that is not the main issue. It is how Parliament handles these matters. There seems to be some confusion in all this.

The former Home Secretary, now the Minister of Justice, said in very graphic terms—admittedly a few years ago—that he was nervous of all these possible passerelle changes because,

“late at night at an ordinary European Council, a decision on one other country’s milk quotas is traded for a concession on moving from unanimity to QMV ... that is not acceptable”.

He spotted that there was deep concern here and that that kind of arrangement was simply not acceptable.

When I reread what the noble Baroness had said, there seemed to be some confusion. On the one hand are the normal rules, regulations, directives and other instruments flowing from, or originating in, the EU institutions. We seek, on the whole, to handle these through filtering in the committees of the other place and the distinguished committees of your Lordships’ House. That process has maybe been improved, and overlaps with scrutiny, and so on. That is one story. On the other hand are the changes in the treaty. These are changes to the powers of our Parliament. These are important matters, which could arise through the passerelle provisions. I do not think that anyone denies that. This is what the passerelle provisions could do. Admittedly, in the earlier treaties, they could only do so with the approval of Parliament, but in this treaty and the constitutional treaty—and the provisions here are identical with those in the constitutional treaty—they could do so without the approval of Parliament.

The noble Baroness spoke about her plans for filtering through the committees of this Parliament and giving them “new powers”. I am not sure how these ideas would apply in the other place. None of these new powers can possibly substitute for the basic requirement, which is a proper Act of Parliament before the treaty is altered in ways which transfer or reduce the powers of Parliament. I hope that we can focus on that, and possibly hear more about the new powers—which the noble Baroness has discussed, or is discussing, or plans to develop—for filtering various matters through the committees of this House and improving scrutiny procedures. That is very interesting, but not the main point.

We have never faced this situation before. Now that we do so, we must build in the proper safeguards, which are powers in Acts of Parliament to ensure that future changes are also by Act of Parliament. There is no short cut or bypass to obviate this fundamental need. Those who want to see effective parliamentary scrutiny and, more than that, want to see treaty changes go through proper parliamentary procedure, ought really to be sympathetic to this amendment, as were the Liberal Democrats and my own party in the other place. That is the requirement that we now face. This debate may flow over into further debates in the handling of this Bill, but here, tonight, this is about the need for Acts of Parliament. Mere approval of both Houses and affirmative votes in both Houses may not be enough. We have heard from the former Home Secretary Mr Jack Straw that these things can happen “late at night”. That is what he said. He is right and I support his apprehension about what could have happened under the previous constitution treaty, and which could also happen under this identical treaty before us. I beg to move.

My Lords, the noble Lord, Lord Howell, referred to the position taken by the Liberal Democrats in another place. It is interesting to take note of the process that we are going through. In both Houses we go through a Committee and a Report stage. A Bill changes as it goes through, sometimes by amendment, sometimes by government assurances. Sometimes things come back again and again, totally unchanged. That is only because the noble Lord, Lord Pearson, has not read the Companion. The approach taken by my party was best expressed by my honourable friend Jo Swinson, who asked how many and which decisions should be addressed by Parliament. At the same time, we should not impose a huge bureaucratic burden that stalls any kind of process both in this House and the EU. That has been the theme of a number of our debates on the amendments.

We have had a number of amendments from the Conservative Front Bench that look perfectly reasonable in isolation. They seek a report to Parliament here and primary legislation there, but collectively it is not so much belt and braces as bondage. As Jo Swinson warned, if we took all these bits of advice from the Conservative Front Bench we would have a process that would cripple not only Europe but Parliament. Earlier the noble Lord, Lord Howell, asked for a more rational and practical approach. The Liberal Democrats bow to nobody in either House in our commitment to parliamentary accountability so far as Europe is concerned, but how do we develop that in this Parliament with the flexibility to reach an understanding both of how this Parliament works and how Europe works?

I have to say that whatever positions we took at an earlier stage, we have welcomed the willingness of the Government to address and clarify issues about parliamentary accountability. On the one hand, these amendments would make a draconian demand for primary legislation but, on the other hand, Amendment No. 24 would take away some of the best parts of the Bill in terms of parliamentary accountability. I do not think we are going to fall for that kind of sleight of hand.

The Lord President of the Council knows very well that we still have concerns about parliamentary accountability, and it would be interesting to know the detail in these cases. When the passerelle orders come before us, will they always be taken on the Floor of the House? Will we be told that like statutory instruments, it is not really done for this place to try to turn them down, or will being passed by both Houses be a genuine process? If we can get those assurances, plus the kind of negotiations that I know are going on with the European Union Committee and the Constitution Committee, we will approach the practicalities of the Bill much more effectively than by adopting the rather inflexible, blunderbuss approach reflected in these amendments. Certainly at this stage we will not be supporting them.

My Lords, I suspect that I am not the only one in the House who finds it difficult to follow the twists and turns of the Liberal Democrat explanation of its position.

These are not trivial provisions. We are talking about the possibility of changing the conditions of the treaty in ways that are very substantive and which, under normal circumstances, would require a new treaty with all that goes with it. Let me point out just a few of the provisions we are talking about. Under Article 31(3) is the ability to move the common foreign and security policy on to QMV. The Government have made great play of the fact that that is to be by unanimity, but here is a provision that allows it to be agreed that it should be moved to QMV. A provision under Article 81(3) states that family law should be decided by QMV, while a decision under Article 31(2) would allow provisions on EU finance—the budget—to be decided not by unanimity but by QMV.

The provision under Article 33(2) allows enhanced co-operation to be carried forward; the cost borne not just by those members who participate but by all members including those who are not participating in the enhanced co-operation. Provision 48(6) allows revisions of procedures in the treaty to be taken by simplified revision procedures; that is, qualified majority voting. We may ask why the provisions are in the treaty; is it conceivable that anyone would ever want to do that?

One can only assume that those provisions are in the treaty because someone believes that at some stage the European Union might want to decide that it moves these matters from unanimity to QMV; otherwise, why are they in the treaty? We could have struck them out. To suggest that such measures should be left to the Executive is a complete denial of parliamentary democracy. It may be that we trust that the Executive would say no and use their veto to stop those matters, but we are not an Executive Government in this county unfettered by Parliament. We are a parliamentary democracy, and our tradition has been that changes of this magnitude should be approved by Parliament. For the noble Lord, Lord McNally, to suggest that it is a huge bureaucratic burden to suggest that Parliament should be asked to approve changes that previously would have required a treaty change would have former liberal parliamentarians turning in their graves.

We must accept that those are significant provisions, which are of the nature of treaty changes. It may be that they are not used in the future, but if they were used and the Government were to agree that those things should be done by QMV in the future and the treaty should be changed in that way, they must be subject to parliamentary control.

My Lords, the issue that we are debating is not whether Parliament should have control but the nature of that control. I agree wholeheartedly with the noble Lord that it is important that Parliament should have control, which is why the provision is in the Bill. The issue is the kind of control that is most appropriate in this case. The difficulty that I have with the proposals of the noble Lord, Lord Howell, is that effectively Parliament’s control could be more unwieldy and less effective than what we have set out, which is the requirement for a vote in each House before a Minister is enabled to do anything.

We are clear in the Bill that a Minister of the Crown may not vote in favour of or otherwise support. That closes off the issues that noble Lords would reasonably be concerned about; that by saying nothing or abstaining, somehow a provision could go through on the nod because we have not intervened. Under our provisions, no Minister would be able to do that; they would have to say, “I am sorry, I would have to vote against that proposal because I do not have clarity from Parliament as to its views”. We have a large degree of agreement that Parliament must have a significant voice and a vote. The question is how best to achieve it.

I appreciate the noble Lord, Lord Howell, bringing back the matter, because on the last occasion I said that it was a new power and the noble Lord rightly asked me to explain in greater detail how it would work. I am grateful to him for giving me that opportunity. The noble Lord, Lord McNally, in his remarks and in conversations that I have had with him, has said that he is keen to ensure that we have been clear about Government thinking in order to address the concerns that Liberal Democrats have in other places, as the noble Lord would have in your Lordships’ House.

Let me try to set that out. Significantly, this is a new power because until now Parliament had no control over the passarelles. This point is new; it is something that my right honourable friend the Prime Minister was keen to ensure that we had. It recognises the importance of the Lisbon treaty and of Parliament.

My Lords, does the noble Baroness agree that there is also a change between the discussions that occurred when we were looking at the constitutional treaty and the position that we are looking at now? At the time of the constitutional treaty, only the House of Commons had a right to have a view about these matters, but now we have a provision whereby both Chambers will have a view.

My Lords, the noble Lord is correct. As he would expect, I feel quite strongly about the role of your Lordships’ House and the importance of ensuring that your Lordships have the opportunity to contribute where that is appropriate, as I believe it is here.

As I said, this is a new power. It is a new power because this is a new provision; it is the first time that we have had it. Noble Lords rightly want to challenge and test how it will work bearing in mind the way in which the conventions in your Lordships' House have traditionally operated. By recognising that this is a new power, I am saying that this is a new power where the conventions do not apply. As the noble Lord, Lord Howell, rightly said, this applies to both Houses of Parliament. As I said, this has to involve both Houses of Parliament and not—as the noble Lord, Lord Roper, said—just one. I want to be absolutely clear that if either House of Parliament says no to a Motion, then it will fall. Each House therefore has an effective veto over the use of any passerelle set out in Clause 6. Let me set out the thinking on how we believe it will work.

In practice, a Minister would ask Parliament to agree a Motion to use one of the listed passerelles. We envisage that this would probably be a straightforward yes or no question on whether to use a specific passerelle; for example, whether to move a specific policy area from unanimity to QMV or co-decision. After debate in both Houses, there will, if necessary, be a vote. Of course, it is for your Lordships to decide whether to vote, but we assume that there will be one. In another place, just for completeness, the Motion will be debated under Standing Order 21 which provides for a debate of up to 90 minutes. In your Lordships' House, it is for your Lordships to decide how much time you wish to spend on such a debate. We would expect that debate to be on the Floor of the House. The Government would discuss timing through the usual channels, as noble Lords would expect. At the conclusion of the debate, there will be a vote if a vote is needed. That is in the hands of your Lordships. We would ensure the capacity for there to be such a vote.

Again, for clarity, the usual conventions on statutory instruments will not apply. There is no constraint on your Lordships' House in deciding to give or withhold its approval. I think that that is the most fundamental point raised by the noble Lord, Lord McNally, regarding clarity and why this is different. He is right to say that an evolutionary process has happened here, and I am able to set it out very clearly. I believe that it is a significant difference.

The Bill makes it clear that the Motion has to be agreed without amendment so that we do not have any confusion about what happened, about whether or not it has been unequivocally agreed.

We move on to the subject of Amendment No. 24: the flexibility in the Bill. We have tried in the Bill to provide a little flexibility if Parliament agrees. As noble Lords are well aware, there may occasionally be negotiation on the final wording, perhaps on the date from which it is meant to take effect or in relation to the simplified procedure and the precise language of a provision. We have made it clear in the Bill that it is a matter for Parliament to grant flexibility and to decide whether it wishes to allow Ministers flexibility to take advantage of the negotiating process in order to promote the UK's interests. There is no question but that if Parliament wishes to remove any flexibility, it can do so. It may wish to grant flexibility elsewhere.

If the Government seek approval of a Motion with some negotiating flexibility then either House can amend that part of the Motion. Parliament can say yes to the passerelle but no to the flexibility. In answer to the point raised by the noble Lords, Lord Blackwell and Lord Howell, we think that this is a simple, efficient and effective way of requiring and giving Parliament the opportunity to control the passerelles, rather than an Act of Parliament with all that that would entail. If we had the position where we had an Act of Parliament, we might have to keep coming back to Parliament if there were a change, however minor, rather than this procedure which gives effective control to Parliament through a vote of the kind that I have outlined. I understand why a position that says that the conventions of the House would apply would make noble Lords nervous if they felt they were being hamstrung into having to vote. As I have made clear, the Government do not take that view. Quite the opposite; it is for your Lordships to decide.

I have given as clear an explanation as I can of how this would work in practice. We will obviously continue our discussions with the House authorities through the usual channels but that is the Government’s position. On that basis, I hope the noble Lord is able to withdraw his amendment.

My Lords, this has produced a number of new proposals which it will be very interesting to study more carefully. It comes down to a straight division of view as to whether primary legislation is a better curb on changes in the powers of Parliament and changes in treaties, as my noble friend Lord Blackwell said, of potentially a massive kind, or whether this can be done under the kind of procedure the Minister is now describing, which involves some powers but these powers apparently are to be achieved through changes in the Standing Orders of both places. The Minister speaks about SO 21. Probably I am out of date, but I can recall SO 20 and various emergency debates which could be moved under that. Is it now the position that in the other place SO 21 would allow the recommendations of the appropriate Select Committee—I am not sure which it would be—to be treated as matters of urgency and therefore an SO 21 debate would be granted by the Speaker? Is it the Speaker of the other place who has the power to see this process goes forward?

My Lords, it is not down to the Speaker. I sought to give as much clarity as possible and I will make sure that I give the noble Lord chapter and verse on this. My understanding is that Standing Order 21 is simply the Motion that says that there will be a debate on the relevant point and that the debate will last for 90 minutes. I do not believe I have misquoted the Standing Order but I will make sure. This refers to another place and not to your Lordships’ House. The issue I was seeking to address was that there will be a 90-minute debate in another place which will be the basis on which the decision will be taken. Noble Lords do not need to worry about Standing Order 21, which is an order under an Act. The relevant issue for your Lordships’ House is that there would be a debate with a vote. The noble Lord need not exercise himself too much. I was merely saying that there would be a 90-minute debate so that the noble Lord would have a point of comparison. It would be for your Lordships’ House to determine the length of the debate it would wish to have on the same issue. The critical point is that there would be a vote in both Houses and both Houses have a veto.

My Lords, we are into very deep waters here. As for your Lordships’ House, which it is absolutely right for the Leader of the House to be concerned with, the procedure she outlines where we have a certain flexibility outside the powers of the Executive would give rise to the opportunity for debates, Motions and maybe even votes amending those Motions in accordance with the Bill. Our concern tonight is with the broader issue of the position of Parliament as a whole and that means the position of both Houses in relation to the Executive agreeing, through the process described in the treaty, to changes in the treaty and the removal of vetoes on certain areas of activity. Those might be significant or insignificant; they might be announced in the middle of the night for trade-off or in the middle of the day. I have no idea which. But now the noble Baroness says that this is all to be under SO 21. Well, I have SO 21 under my finger, and it is all to do with notice of Questions:

“(1) Questions shall be taken on Mondays, Tuesdays, Wednesdays and Thursdays, after private business and motions for unopposed returns have been disposed of.

(2) No question shall be taken more than one hour after the House sits, except questions which have not appeared on the order paper but which are in the Speaker's opinion of an urgent character and relate either to matters of public importance or to the arrangement of business”.

I repeat: are we talking about the Executive allowing government time? That still leaves the whole process basically in the hands of the Executive in the other place. We are all realists about what that really means: the Executive are still calling the shots. Are we talking about Back-Benchers, chairmen or members of Select Committees, who are Back-Benchers in the other place, seeking the support of the Speaker in getting the equivalent of what used to be an SO 20 order, now, apparently, an SO 21 order? I do not understand which of those is proposed, and whether the Executive really are relinquishing power or just seeking, through this arrangement with committees to—

I have not quite finished my question, but I do not understand this.

My Lords, I appreciate that the noble Lord does not understand and I am worried that he is getting into a bit of a state about what is happening in another place, where I hope that the focus of our discussion will be on what happens in your Lordships’ House. Let me be absolutely clear: Standing Order 21 is for any vote under any Act and allows a 90-minute debate. It will be for the Government to table the Motion, as the Bill states. However, under the Act of Parliament that we are about to pass, the Government are not allowed to do anything. Remember what I said: no Minister can do anything—nod their head, shake their head or do anything—until Parliament has approved. The standing order that we are referring to is about the process that another place will undertake. I am absolutely clear that this means a 90-minute debate in government time, with a vote. For this House, the debate would be given time as normal, with a vote. The critical difference is that there is no convention governing this House on that vote. Any vote to oppose the Government’s proposal is a veto on the Government.

My Lords, I do not want to detain your Lordships on a complex business. However, Standing Order 21 of the House of Commons is on an area controlled by the Speaker, not by the Executive. That is what it says; the thing is written in front of me. There seems to be considerable confusion, but behind it lies a basic fact.

The noble Baroness is second to none in upholding and elucidating—indeed, improving—the role of your Lordships’ House as an amending and cooling Chamber. That is very good and she does it excellently. However, this debate is about something larger than that. It is about the powers of Parliament in relation to changes in treaties that would reduce the powers of our Parliament, in the elected lower House and this House, which is currently appointed. That is what we are concerned with and it is not at all clear from our discussion. SO 21 does not clarify the issue; it seems to confuse it further. The Executive appear to be still in control of the scene, as the noble Baroness has described it. Government time will be allocated. The request of a Select Committee will come bubbling up and it will be in the power of the Executive, if it is in their interests—

My Lords, I hesitate to intervene, but the noble Lord, Lord Howell, in attempting to clarify the precise procedure that might be followed in obtaining the support of Parliament, seems—not deliberately, I am sure—to be underemphasising the significance of the requirement in this Bill to obtain the approval of Parliament before these changes can be made. Ex ante, the Government’s executive role is controlled not by the decision that may be taken in a debate, however that debate is initiated, but by the very statute that we are debating tonight. That seems to me to be a profound inhibition on the Government. Although I wholly accept the necessity to put beyond doubt how the debate will be tabled, the fact is that the Government will be prevented from changing the law from what it will be under the Bill that we are debating.

My Lords, I see the point that the noble Lord is trying to make, but my contention is that the would-be statute, the Bill, with which we are concerned does not do the trick. We were looking for something stronger to satisfy the proposition that this will not be just another device for the Executive, on their own say-so, to allocate their own time, or not, and to whip their majorities, or not, into line on a change in the treaties that might affect a lot of people who would feel that there had not been a proper parliamentary process. That is the difference between us, I am afraid.

My Lords, I hesitate to intervene again but I am concerned that the noble Lord is suggesting that somehow the Government or the Opposition would not whip on a Motion of this kind. Let me be clear about this. I apologise if there is any misunderstanding as regards Standing Order 21. If we are wrong about the number, I will, of course, correct it. That is the number I have been given. However, I appreciate that because I am not a Member of another place I am not familiar with the numbers in the way that, sadly, I have become familiar with the Companion. The Government guarantee to make time because they have to. They cannot do anything unless they do. They do not have any power to go to Europe and negotiate anything on these passerelles without parliamentary approval in both your Lordships’ House and another place. The Government cannot do anything, therefore they have to make time. Of course, it is government time because noble Lords would no doubt complain if it was not. That is right and proper. Where this has relevance and significance in terms of other instruments is that the Government will find time, in collaboration with the usual channels, for this to be debated. Noble Lords will know that even when there are conventions that, for example, statutory instruments are not voted against, on occasion they have been. We are saying that there are no conventions here; this is new. Therefore, noble Lords can vote on it.

There is absolute clarity on this. I am worried that the noble Lord, Lord Howell, is trying almost to confuse the issue in order to bring it back. I do not accept that. It is crystal clear that in both Houses of Parliament there will be a vote and a veto by either House. It will be done under the appropriate Standing Order of another place and it will be done in your Lordships' House under the procedure I have outlined. That could not be clearer. That is the decision before your Lordships’ House: whether that is sufficient to give what I believe is effective control or whether noble Lords believe, for reasons I do not understand, that an Act of Parliament is required as well.

My Lords, I totally reject the proposition that I am trying to confuse the issues; I am trying to clarify them. We have already had a completely misleading proposition about the Standing Orders of the House of Commons. Frankly, it is rather disgraceful that we should be misled over that. If the noble Baroness is suggesting that I tried to confuse things originally, I do not accept that.

My Lords, I do not think that I behaved in a disgraceful manner. I have already said that if I made a mistake I will correct it. I was not trying to act disgracefully in any way, shape or form. Indeed, under the new book that has been published, the relevant standing order is Standing Order 60.

My Lords, now we have moved to another Standing Order. I want to keep this calm and I do not want us to be distracted by the off-stage noises.

My Lords, the noble Lord is being a barrack-room lawyer on this matter. If he wants primary legislation, he should test the opinion of the House. The Government have moved a great deal on this. He has managed to find a genuine mistake and now wants to turn it into a conspiracy. Some of us resent that.

My Lords, I have been called many things, usually in an opposite category to “barrack-room lawyer”. I do not think that I fit naturally into that category. However, I agree with the noble Lord that we should test the opinion of the House. There is a difference between us over whether the 90-minute procedure described by the Minister suffices as proper parliamentary control. We do not think that it does and we are entitled to that opinion. There is a doubt about how it would work in the other place. It is not a case of finding a difference: there is a distinct doubt. I will take the advice of the noble Lord, Lord McNally, which is often very good. Sometimes it is not very good and sometimes it is rather rude. However, in this case, I will take his advice and urge that we now test the opinion of the House.

My Lords, I beg to move that consideration on Report be now adjourned.

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

House adjourned at 10.51 pm.