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European Council

Volume 760: debated on Monday 23 March 2015


My Lords, with the leave of the House, I will now repeat a Statement given by my right honourable friend the Prime Minister in the other place. The Statement is as follows:

“I know that the whole House will join me in welcoming David Natzler as the new Clerk of the House. Mr Speaker, you went to the ends of the earth in search for the best candidate, but I am glad that we found the answer right here in Britain.

Before turning to the main focus of the Council, which was the situation in the eurozone, let me say a word about the discussions on Tunisia and Libya, on the situation in Ukraine, and on the nuclear talks with Iran.

I am sure that the whole House will join me in sending our deepest condolences to the friends and family of Sally Adey, a British holidaymaker who was among at least 20 tourists and two Tunisians brutally murdered in the terrorist attack at the Bardo museum last week. I have written to President Essebsi to assure him that Britain will stand with the people of Tunisia as they seek to defeat the terrorists and build a peaceful and prosperous future. The EU has agreed to offer practical assistance, and Britain will play its part, deploying SO15 and military counterterrorism experts and continuing to provide assistance in aviation security and tourist resort protection.

The suggestion that some of the terrorists involved had been trained in Libya is the latest evidence of the very difficult situation in that country. The Council agreed on the need for a political solution, supporting UN-led efforts to bring the different parties in Libya together to agree a national unity Government. Britain has provided Libya with aid and military training, and we will continue to do all we can to assist.

I know that some people are looking at this situation and asking whether Britain, France and America were right to act to stop Colonel Gaddafi when we did. We should be clear that the answer is yes. Gaddafi was on the brink of massacring his own people in Benghazi. We prevented what would have been a wide-scale, brutal, murderous assault. It was the right thing to do, and we should be very proud of the British service men and women who carried out this vital task.

Turning to the situation in eastern Ukraine, the Council welcomed the significant reduction in fighting and the progress on the withdrawal of heavy weapons. But, as President Obama, President Hollande, Chancellor Merkel and I agreed earlier this month, it is essential to send a clear signal that sanctions will not be eased until Russia delivers on its promises and the Minsk agreements are fully implemented. This European Council did exactly that. The conclusions state that,

‘the duration of the restrictive measures … should be clearly linked to the complete implementation of the Minsk agreements’.

They also underline our readiness to take further measures if required.

One of the best things we can do to help Russia’s neighbours is to help them fight corruption and strengthen their democracy. Just as the Know-How Fund set up by Margaret Thatcher did a great job of helping Eastern European countries after the fall of the Berlin Wall, so we need the same approach today. At the Council, I announced a new good governance fund with an initial £20 million to support reforms in countries in the eastern neighbourhood and western Balkans. This will complement support from other donors. It will accelerate efforts to fight corruption, strengthening the rule of law, reforming the police and justice system and supporting free markets by liberalising key sectors such as energy and banking. The fund will be up and running by the summer. As well as Ukraine, it will initially cover Georgia, Moldova, Serbia and Bosnia-Herzegovina.

Turning to Iran, I met Chancellor Merkel and President Hollande in the margins of the Council to discuss progress in the vital talks on Iran’s nuclear programme. We are absolutely clear and united in our purpose. Iran must never be allowed to develop a nuclear weapon, but there is a peaceful path to civil nuclear energy. We believe that a comprehensive, durable and verifiable deal is possible, but only if Iran shows greater flexibility and takes some tough decisions during the talks this week.

We also discussed proposals co-ordinating Europe’s energy policy, ensuring transparency of gas supply agreements and that Europe’s energy policies are consistent with reaching the vital deal at the climate change summit in Paris this December.

Turning to the eurozone, the Council welcomed the agreement between Greece and the euro area to extend their programme. Let me say again: this is the last of these Statements of this Parliament, and I think I have uttered this sentence probably 11 times, but Britain is not in the eurozone and we are not going to join the eurozone. But we need the eurozone to work properly. A disorderly Greek exit from the euro remains a major threat to Europe’s economic stability, and it could be very damaging to the British economy. Protecting our economy from these wider risks in the eurozone means sticking to this Government’s long-term economic plan.

Five years ago, Britain’s economy was close to the edge. We had the biggest budget deficit in our peacetime history: a deficit that was forecast to be bigger than that of Greece or any other developed country on the planet. Five years on, the deficit has been halved and our national debt is falling as a share of GDP. We have the fastest growth of any major western economy. We have 1.8 million more people in work, more jobs created in Yorkshire than in the whole of France, and more jobs created in the UK than in the rest of the European Union”.

My Lords, I am repeating a Statement. This is not a debate.

“We need to stay on this path, not abandon it just as it is leading our country to prosperity.

Just as we are acting in our national interest at home, so we have acted to protect our national interest in Europe, too. We have cut the EU budget for the first time in history, we have got Britain out of the euro bailout schemes, we have vetoed a treaty that was not in our national interest, and we have stopped attempts to discriminate against EU countries outside the eurozone, not least with our successful legal challenge last month. We have made vital progress on cutting red tape and completing the single market.

At our G8 in Lough Erne, we kick-started the talks on what will be the biggest bilateral trade deal in history between the EU and the US. We have put power back in the hands of our fishermen so they can sell what they catch. We have negotiated a new single European patent that will reduce costs for entrepreneurs, and part of the patent court will be based right here in London. We have ensured new safeguards to protect our vital financial services industry, and we have returned over 100 powers from Brussels to Britain, giving us more control over our borders, policing and security.

We have clamped down on benefit tourism, and in foreign policy we have worked with European partners to get things done and keep our people safe—from sanctions on Russia and Iran and practical assistance to help countries in north Africa fight terrorism, to international action to help those in desperate need around the world, including in west Africa, where British aid workers are risking their lives helping to stop the spread of Ebola.

In the coming two years, we have the opportunity to reform the EU and fundamentally change Britain’s relationship with it. We have the opportunity to build a European Union that is more competitive, more flexible, more accountable to the people, where powers flow back to member states, not just away from them, and where freedom of movement is not an unqualified right. For the first time in 40 years, we have the opportunity to give the British people their say on Britain’s place in Europe with an in/out referendum. If I am Prime Minister, that is what I will do. Those who would refuse to give the British people their say should explain themselves to this House and to the country. I commend this Statement to the House”.

My Lords, that concludes the Statement.

My Lords, I am grateful to the noble Baroness the Leader for repeating the Statement made by the Prime Minister. The noble Baroness, Lady Royall, apologises for unfortunately being unable to respond on behalf of the Labour Party, as she has been called away on an emergency, but she would like to underline how seriously the Labour Party, and she personally, is committed to Europe.

I begin by condemning the appalling terrorist attack in Tunisia last week. Our thoughts go out to the family and friends of Sally Adey and all the victims who were involved in the attacks. This despicable act, once again, reinforces our determination to stand united across Europe against terrorism.

As the noble Baroness went way beyond the Council communiqué, I shall stray only slightly by noting that, since the last European Council, we have also had the Israeli elections. Although they do not appear to have been discussed at the Council, there should be one overriding priority in relation to Israel: restarting negotiations towards a two-state solution—a secure Israel alongside a viable Palestinian state. In the light of Prime Minister Netanyahu’s comments in the run-up to the election, have the Government sought reassurances about his commitment to a two-state solution? Does the noble Baroness agree that we must put pressure on both sides to restart negotiations? Nothing short of a meaningful peace process will do for this region of the world.

On Iran, we support the talks. We cannot allow an Iran with nuclear weapons; it is vital that we secure a successful outcome. We will support the EU in seeking to bring that about. Let me also echo the noble Baroness’s comments on Libya. We supported the military action that was taken and we now support the call for an immediate and unconditional ceasefire. Why does she believe that things have gone so badly wrong in Libya? Are people not entitled to conclude that the international community did not make adequate planning for the aftermath of the conflict? What does she believe can be done now?

We welcome the discussions taking place between Greece and Germany today. Can the noble Baroness tell us what she thinks the prospects are for a long-term agreement with Greece—an agreement that is in the interests of Greece, the eurozone and the UK?

Turning to the situation in Ukraine, it is vital that the international community stands united in ensuring that the Minsk agreement is implemented in full. We welcome the commitment that EU sanctions on Russia should be eased only in the event of the full implementation of that agreement. Given the situation on the ground and the signs of continuing Russian aggression, I ask the noble Baroness whether discussions took place during the summit about increasing further the pressure on Russia—specifically on so-called tier 3 sanctions on specific sectors.

It is clear that the security dimension of the EU is becoming more and more important. This demands common action, resolve and a clear commitment to our continuing place in the European Union—a commitment on which, of course, it is difficult for the party opposite to deliver. Earlier this month, General Sir Peter Wall warned that reaching common policies would be more difficult still if we were outside the EU. How do the Government answer this warning? Why should we take risks with the effectiveness of our soft power by pursuing a policy that risks divorce from our key allies?

Three years ago the Prime Minister walked out of a European Council announcing that he had vetoed a treaty—but it went ahead anyway. Last year he demonstrated his appalling failure at relationship building, winning support and delivering for Britain by losing a vote 26 to two, becoming the first ever British Prime Minister to lose a vote in the EU Council. Last autumn, after saying that there was no way he would pay back the £1.7 billion extra EU budget bill, the Prime Minister achieved a deal for the UK where we still have to pay, saving taxpayers not a single penny. And now the Prime Minister wants to return to Brussels following the election with a mandate to reform. So perhaps the noble Baroness can tell us: what are the non-negotiable reforms her party is seeking in Europe? Will she comment on the statement made last week by the President of the European Council, supposedly an ally of Britain, who described the Prime Minister’s position as “mission impossible”?

The truth is that the Government’s approach to Europe has created unnecessary economic uncertainty at the precise time when our economy needs stability based on growth and investment. I am afraid that the party opposite cannot be trusted on Europe. It cannot tell us what it is negotiating for and has no strategy to achieve change. Britain badly needs leadership on Europe that puts the national interest first. Britain needs a Labour Government.

My Lords, I am grateful to the noble Baroness, Lady Morgan of Ely, for standing in for the noble Baroness, Lady Royall, and for her various comments. They were quite wide-ranging and I will go through them in turn.

The noble Baroness asked me about Israel and whether we would put pressure on Prime Minister Netanyahu to continue towards a two-state solution. I certainly congratulate Mr Netanyahu on his election victory, and I agree with the noble Baroness that we must put pressure on both sides to ensure that talks get going on a two-state solution. Indeed, the Prime Minister will be talking to Mr Netanyahu this evening, and he will be very clear in that conversation about our support for such a solution; it is in the long-term interests not just of the Palestinian people but of the Israelis and the wider situation in the Middle East, and Britain’s position on that will not change.

The noble Baroness asked what was happening in Libya now. We should be clear that the Libyan people and Government did not want an occupying force—they did not want to be controlled remotely by others. They were given the opportunity to opt for a more unified future but sadly they have not yet taken it. We have done everything that we could to keep putting that option on the table, and we will continue to do so towards a national unity Government. We will very much be part of the UN-led effort to that end.

The situation in Greece remains worrying. On the one hand, there are the various creditor nations that want to see Greece fulfil its programme; on the other, there is a Greek Government who do not yet seem to have come up with reforms that give their creditors confidence. However, I am pleased that the negotiations on that continue. It should be noted that Chancellor Merkel is meeting Prime Minister Tsipras today.

The noble Baroness asked about sanctions relating to Ukraine. I make the point that it was very much the UK that led the way on ensuring that sanctions were put in place, remained in place and were extended until the Minsk agreement is implemented in full. If things were to deteriorate in Ukraine then yes, we should be prepared to consider more sanctions, should that be necessary.

Regarding the questions that the noble Baroness put to me regarding Europe and the future, I shall say a few simple things to her and to the House. The people of the UK, and indeed throughout Europe, do not want the status quo in Europe. They want Europe to be focused on jobs and prosperity, recognising that it is an organisation, or a partnership, that is made up of 28 individual member states. The Prime Minister will renegotiate our membership of the European Union; he is committed to doing that and has proved that it is possible to renegotiate some of the terms of Britain’s membership in Europe. We are absolutely committed to reform; we think that that is the right way forward, and it is in stark contrast to what the Opposition are offering, which is not even to acknowledge that Brussels has too much power. When the Prime Minister has successfully renegotiated the terms of Britain’s membership of Europe, he has committed to giving the people of this country a say in the membership of Europe with an in/out referendum, and we are the only party that is committed to doing so.

My Lords, I thank the Leader of the House for repeating that Statement, which sounded rather like the Conservative election manifesto—but then so did Labour’s response. I am sure the House will be pleased to hear that I will stick to the conclusions of the European Council rather than doing that.

The conclusions say at paragraph 13 that the high representative, in co-operation with member states, is going to prepare an action plan by June to counter Russia’s disinformation campaign. In light of the questions we had a little earlier today in the House, can the Leader of the House confirm that the BBC will assist the high representative in forming this communication team, as it clearly has great expertise in that regard? The other point is on paragraph 16 and the Commission’s initiative to submit a European agenda for migration. Will this be restricted perhaps to the Schengen area, or will it be a comprehensive EU-wide agenda, because the material facts and action possible will be very different in both regards?

Finally, the Leader of the House challenged us at the end of the Statement on the European referendum pledge—

I am concluding. Could I just ask whether the Leader of the House has seen the report coming out today by Open Europe on the cost of exit?

On my noble friend’s first point about communication and Russia, I would not want to commit as to what role the BBC World Service might play. I point my noble friend to the fact that the good governance fund to which I referred in the Statement is designed to help those eastern nations which neighbour Russia and in the Balkans to improve their strategic communications. As to her point about the Open Europe report today, the key thing that I took away from it was that the best way forward is for a reformed European Union, and that is what David Cameron is committed to securing.

My Lords, I would like to pose two questions which were discussed at the European Council. The first relates to sanctions on Russia. I wonder if the Leader of the House can confirm that my reading of paragraph 10 of the conclusions, which states that,

“the duration of the restrictive measures against the Russian Federation, adopted on 31 July 2014 and enhanced on 8 September 2014, should be clearly linked to the complete implementation of the Minsk agreements, bearing in mind that this is only foreseen by 31 December 2015”,

in effect precludes any decision by the Council when the one-year duration comes up for discussion in July and September other than to continue the sanctions, unless by some chance Mr Putin has undergone an epiphany of an unlikely kind.

Secondly, the Council conclusions—here I refer to paragraph 16—refer to the need to strengthen Triton, the FRONTEX operation in the central Mediterranean. What contribution will Britain make to the strengthening of the FRONTEX operation in the central Mediterranean, given that on both humanitarian and migration grounds it is in our interest that that operation should work better?

On the first question the noble Lord asks about sanctions against Russia, I can be absolutely clear: those sanctions are linked to the full implementation of Minsk and remain in force until the end of this year. That is what was committed to at the Council. He may remember that the Prime Minister led the charge to ensure that these sanctions extended beyond the original deadline of July 2015 until the end of this year, and that is what was agreed at the Council last week. As for his question about the central Mediterranean, I am afraid I will have to come back to him on that.

My Lords, is the noble Baroness familiar with the content of paragraph 13, which was referred to by the Liberal Democrats? It says:

“The European Council stressed the need to challenge Russia’s ongoing disinformation campaigns and invited the High Representative … to prepare by June an action plan”.

It goes on to say:

“The establishment of a communication team is a first step in this regard”.

It plans to get a programme “by June”, and before that it will establish a communication team. Does the Minister agree that that statement, to which her Government have subscribed, does not give the necessary degree of urgency to a problem which this House took much more seriously at Question Time than the Government seem to have done in their communiqué?

I do not agree with the noble Lord’s description of what the Council agreed. However, clearly, I will ensure that the views expressed during Oral Questions today on that matter are relayed back to the Foreign Office. Indeed, my noble friend Lady Anelay answered those questions, so I am sure she will already have done so.

My Lords, that was a commendable Statement. Has my noble friend noticed that a good deal of the General Secretariat conclusion document is taken up with thoughts about an energy union and energy policy at the EU level? Does she agree that it may be time to remind, or ask her colleagues to remind, the European Commission and the secretariat of the Council that energy competence does not lie totally with the European Union but is shared, with the bulk of it lying at the national level? Some things can be done better at EU level, such as interconnectors of gas and electricity to help the eastern European states, which are dependent on Russia. However, does she accept that a great deal can be done by nation states to improve their affordable energy supplies and to help with decarbonisation and reliability without the expensive and misguided policy advice of the Commission? Can she pass that message on?

I always pass on the messages my noble friend provides me with. Energy policy is quite an interesting example of where the Prime Minister has been influential in refocusing the European Union’s approach. We have been able to ensure that we have combined energy security, the costs of energy, and climate change in a more sensible way, so that the way in which we try to improve the internal market for energy in Europe makes sense to member states. Certainly, we have been able to reach agreement without any kind of inflexible targets on member states which mean that they are no longer able to decide their own energy mixes; as my noble friend suggests, that is a very important part of our independence.

My Lords, does the noble Baroness agree that the Statement she has just read out exposes the contradiction and confusion at the heart of the Government’s European policy? In the first half, we had many good reasons why we need to stand together with our European partners—to deal with the situation in Iran, to stand up to Russia, to deal with chaos in north Africa and the problem of migration. All those are good reasons for working within Europe. In the second half, however, we had the Government’s policy of standing there with one hand on the exit door. How on earth can Britain lead in Europe if at the same time it is threatening to leave?

My Lords, the only person who is confused about European policy is the noble Lord. During our time in Government, we have been committed to ensuring the best deal for Britain as a member of the European Union. The Prime Minister has been successful in securing a reduction in the European budget. He has vetoed a treaty that was not in our interests and secured lots more reforms, that have been in the interests of the British people whereas the noble Lord’s own party leader talks only about Brussels not having enough power and about joining the single currency potentially at some point in future.

My Lords, I quite agree with the Statement where it says that a disorderly Greek exit from the eurozone is in nobody’s interest. Clearly, it is an orderly exit that is desirable. However, I should like to revert to what my noble friend Lord Howell said about energy policy. This is very important. Is my noble friend the Leader of the House aware that over the past few years a great battle has been going on between the Commission, which wishes energy policy to be a European Union competence, and the United Kingdom, supported by Poland in particular, which says that energy policy and mix should be a national competence? So far that has prevailed. Can she give an undertaking that that is the policy of the Conservative Party as there has been a certain amount of party politics, however deplorable, in these exchanges so far? Can she give a firm undertaking that it is the policy of the Conservative Party that energy policy will remain a national and not a European Union competence?

Yes, I can give my noble friend that assurance. As I have said, what we have been able to secure because of the Prime Minister’s negotiating powers in Europe is that we retain responsibility for deciding which methods of energy we should use in our country.

My Lords, can the Leader of the House state quite clearly that the sanctions on Russia will not be eased until there is full implementation of the Minsk agreement? That agreement covers only Luhansk and Donetsk—it does not touch on Crimea. The implication is that, if the Russians observe their obligations under the Minsk agreement that relate to Luhansk and Donetsk provinces but remain in full occupation of Crimea, contrary to international law and the Budapest agreement, all economic sanctions will then be lifted. In practice, would not that amount to the western world acquiescing in the illegal occupation of Ukraine? Is that really the Government’s policy?

We remain absolutely clear that Russia’s annexation of Crimea was illegal and illegitimate, and we will certainly not change our view on that.

My Lords, while my noble friend is taking messages back, will she take the message back that it is very often easier to get people to join with you if you occasionally say how good it is to be party to and a member of the European Union? Would it not be much more helpful, in the perfectly proper desire to have reform in the European Union, if we just remarked on the huge importance to Britain of being in the European Union and to the European Union that Britain is in it? If we were a bit more positive, we would have more chance of winning.

I am grateful for the message from my noble friend as well. I agree with him at the same time as I agree with my other noble friend, because this is precisely the point. We believe that there are really important, positive advantages to Britain being a member of the European Union. However, we do not believe that the status quo is where we should remain. We believe that some changes are necessary in Europe—that is what the Prime Minister is committed to renegotiating; then he is committed to putting that clear choice to the British people. But there are very important and positive reasons for us to remain a member of the European Union.

My Lords, will the good governance fund come out of the aid budget or the Foreign Office budget? The Statement says that,

“the Council welcomed the significant reduction in fighting and the … withdrawal of heavy weapons”.

Is this not part of Minsk II, and did not the Government and some allies—some European partners—try to ensure that the sanctions, particularly the tier 3 sanctions, would be renewed forthwith? But the majority of our partners thought it made sense to monitor the implementation of Minsk II, which, after all, was agreed on 12 February. Is this not a reasonable position?

In answer to the noble Lord’s first question, the good governance fund will come, initially at least, from the DfID budget. Secondly, I have made it clear that sanctions will remain in place until Minsk II is fully implemented. The importance of those sanctions, and of all members of Europe being united in keeping them in place until Minsk II is fully implemented, was agreed by all member states at the Council last week.

My Lords, I am grateful to the Leader of the House for repeating the Statement—although I noticed that the noble Lord, Lord Lea, tried to intervene part of the way through. Perhaps that was because he thought that the wrong Statement had been passed to the Leader of the House and it was instead the Prime Minister’s draft notes for the leadership debates ahead of the general election. However, I assume that we are actually debating the Council conclusions and the responses to those. Paragraph 6 of the conclusions says:

“Member States and the Commission should step up efforts to communicate the benefits of the agreement”,

that is, the TTIP agreement,

“and to enhance dialogue with civil society”.

Does the Leader of the House agree that it is important to promote dialogue not just on TTIP but on many of the issues linked to that conclusion, including the European Semester, under which heading it, slightly bizarrely, falls? Should we not engage in further dialogue not only on that but also, more generally, on the benefits of British membership of the European Union, which all sides of your Lordships’ House strongly supported in a debate last November?

My noble friend is right to highlight the TTIP agreement—the Europe-US trade agreement. Once it is finally in place it will be worth a huge amount to the United Kingdom and all other members of the European Union. It is a good example of why membership of the European Union remains very important to us as a country.

Why do you think I am sitting over here?

I want to raise a quick question about Iran. We all agree that Iran must never be allowed to develop nuclear weapons, but I would remind the Leader of the House that Iran is a member of the nuclear non-proliferation treaty. Israel is not, yet it has nuclear weapons. What will the Government do to persuade Israel that it too should join the non-proliferation treaty so that proper discussions can take place between two equal parties?

The noble Lord raises an important question, but in the time available I will not be able to do it justice. Clearly we want to prevent the extension of nuclear arms wherever there may be a risk of that happening.

My Lords, in the event of an incident occurring somewhere in eastern Europe during the next six weeks, can we have an assurance that the Prime Minister would not unilaterally take action without the fullest possible consultation with the leader of the Opposition?

The Prime Minister has been clear that his first priority would be to seek a political solution and diplomatic route in response to any kind of situation and that any action taken by the United Kingdom would be as part of wider international auspices.