European Affairs

Part of the debate – in the House of Commons at 8:38 pm on 16 June 2009.

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Photo of Austin Mitchell Austin Mitchell Labour, Great Grimsby 8:38, 16 June 2009

I am not defending the BNP; I am trying to explain the nature of the vote. What will happen when people come to us and ask why the Government cannot do more to help industry and all we can reply is, "Aid to industry cannot be allowed in Europe," or if the Government's reaction to proposals for retrospective business rate payments in the docks, which will cause closures and unemployment, is that they cannot stop them because aid to industry will be struck down in Europe? What about when people say they want something done about immigration or labour conditions or that they want British jobs for British workers at the oil refineries on south Humberside and all we can reply is, "Sorry, we cannot help you; Europe stops us from doing anything"? That speaks of the kind of futility and discontent that leads to an increase in the BNP vote.

We all know the old joke about how many MPs it takes to change a light bulb. Nowadays, the answer is not 646, but 785—the number of MEPs required to change a lightbulb, because it is something that we in this Parliament seem unable to do. That cannot be good for democracy, and it is certainly true that the EU is not good for the economy. We are now moving towards cuts, stringency and austerity—a period in which there will be an onslaught on Government spending probably from both main parties, although it will, of course, be more massive from the Conservative side.

Let us look at the burdens imposed on us by Europe, which have increased for two reasons: the first is our former Prime Minister's agreement to give up a substantial chunk of the rebate in order to bring about reforms in the common agricultural policy, which everybody knows we will not get and we cannot get in any case until 2013; and, secondly, payments to Europe are increasing because of devaluation. Those payments have to be made in euros across the exchanges, so every time the pound goes down, the payments increase.

Our net contribution, excluding the £2 billion or so we contribute to projects such as Galileo, which is about providing a satellite guidance system that people have to pay for, unlike the American one that we get for free, is now about £6 billion a year. That is spent across the exchanges, and it increases to £7 billion and a bit because of devaluation, while the £2 billion increases to £2 billion and a bit, so we are ultimately talking about £9 billion and a bigger bit before we have even started. That contribution does not include the costs of the common agricultural policy, which the OECD calculates as having a real resource cost of £15 billion for our economy, or the common fisheries policy, which was much praised by my hon. Friend Mark Lazarowicz, but which costs about £3 billion a year in fish that are not caught by British vessels but are taken to Europe and sold there, without any contribution to processing jobs in Britain. Then there is the cost of regulations, which is calculated at about £28 billion.

Finally, there is the cost in lost growth because Europe drives with the brakes on the economy. The non-European world economies grew over the last 10 years, before the recession, at 3.8 per cent. a year, while Europe's economy, including ours, grew at 2.6 per cent. a year. Why? Europe believes in deflationary economic management, which means that we lose about 0.5 per cent. of our gross domestic product annually. That is a cumulative process, so we are losing about £7 billion a year in growth that we would have had if we had not been forced to make these contributions and join this club.

That is damaging the British economy. We are carrying a considerable burden—the second greatest in Europe—and we cannot afford to carry it at a time when the Government are going to launch themselves into cuts in budgets of all kinds. Why should we make such a massive contribution to Europe and across the exchanges at such a time?

Last night, in the Public Accounts Committee, we agreed a report on financial management of the European Union. That might be considered quite a comic issue, and the report is pretty hostile and critical. I do not want to quote from it because it has not been published yet, but I must point out that for 14 successive years the European Court of Auditors has refused to agree to the European accounts. There is enormous scope for fraud and fiddles in the two biggest funds, the cohesion and common agricultural policy funds. Between them, they hand out 80 per cent. of Europe's expenditure. Eleven per cent. of spending on the cohesion funds is irregular, while between 2 and 5 per cent. of spending on the common fisheries policy is irregular. That leads to massive deficits.

According to a fascinating book by Marta Andreasen, a former auditor to Europe, in 2003

"the Court of Auditors had estimated that 50 per cent. of suckling cows which were claimed to be grazing in Portugal did not exist. Eighty-nine per cent. of farms in Luxembourg had submitted claims for payments"— area payments—based on an inaccurate assessment of the area of those farms which, if correct, would have doubled the size of Luxembourg. We are told that

"In Greece, one enterprising farmer...claimed"— and he was paid—

"to have lost 501 sheep to wolves between 2000 and 2004".

That is the way in which the money—our money—is wasted, and the European control system appears to be incapable of doing anything about it. The book from which I have quoted, which I hope Ministers, including Treasury Ministers, will read, shows that the funds are controlled by énarques—brilliantly educated French civil servants whose role is to oppose all reform, all change and all adequate systems of auditing, because they would expose the embarrassments and corruption that go on. That is the benefit that we obtain from Europe.

My mother once told me that at the first election meeting that she ever attended, which was in Halifax just after the first world war, the Conservative candidate was obviously to a degree simple-minded. His mother spoke for him: his mother was a lady. She asked the electorate to be "to his virtues very kind, to his faults a little blind". That is our position on Europe in the Labour party, apart from the fact that we are not a little blind but totally blind to its faults.

I consider it tragic that some of the finest minds in the country, including Foreign Ministers in the Labour Government, are involved in the development of second-rate excuses for third-rate policies imposed on us from Europe. A classic example was given earlier in connection with the referendum. Such tortuous reasoning is devoted to explaining that a constitution on which there could have been a referendum, because it involves a basic change in our democracy, is very different from a treaty which is not important although it contains exactly the same provisions, and that while it is possible to vote on one, there is no need to vote on the other. That kind of tautology cuts no ice with the British people. They regard us as fools for even listening to it. They want a referendum, but we are having to listen to a tortuous, Jesuitical explanation saying that they cannot have a referendum, because this is a treaty and not a constitution. I think that that is partly, indeed largely, responsible for the degree of alienation that we are facing. We are trying to sell a culture of lies to the people.

The classic argument about the referendum relates to what is happening in Ireland. The Irish did reject it, and we are now involved in shipping container-loads of blarney over to Ireland to persuade them to vote in favour of something that they have already rejected. As has been pointed out, there have been concessions, but if they are not in the treaty, they are not valid and cannot be sustained, and if they are in the treaty, we will have to re-pass it in this place. I am afraid that all this might well work, however. The Irish have been scared into thinking that if they vote no this time, they will be on their own and out of Europe, and that they will therefore not get all their agricultural subsidies, which will produce terror.

I remember my first visit to Brussels. It was in the early '80s, and I was with a party of Irish MPs. One of them was a member of Fianna Fail. We were in the back of a bus, and he had had a bit to drink—although not much—and he was enthusiastically singing the following campaign song for us all the way around Brussels: "Arise and follow Charlie." That was a reference to Charlie Haughey, and his rendition of the song was stirring. This time the electorate in Ireland need a slightly different theme song, however: "Arise and follow Tony." In other words, if the Irish vote for the constitution, they will get Tony Blair as President. That would be a big inducement to them to turn out in their thousands or millions to vote for the constitution. I am afraid that our hope that we might get a vote in this country because the Irish have rejected the treaty will probably be vitiated, therefore, but that is just me being gloomy in my assessment.

I want to conclude not by being gloomy, however, but by saying that what we need in this European debate is neither the vacuous enthusiasm of the Liberal Democrats—and, indeed, of those on the Labour Front Bench—nor the negativity of UKIP, but just a degree of realism. Why cannot the Treasury do a cost-benefit analysis of the gains and losses of being outside Europe? Why do we not have that to put to the British people so that they know all about what is involved—what they are paying for, and what they are getting? We should provide that information, instead of debating abstractions such as "Europe is wonderful for the environment" or "Europe is good for fish"—a manifest untruth that will cut no ice in Iceland. We should not indulge in such mythology and enthuse about a Europe that does not exist. We would get sensible decisions from people if we gave them sensible information, and if we ourselves had sensible information. It is the responsibility of Government to tell us what we really get from Europe, and the responsibility of the Treasury to do an accurate and full study of the costs and benefits of Europe. On that basis, we could take rational decisions, which is not the basis on which we can take them now.