[Mr Andrew Turner in the Chair] — backbench business — European Council
2:38 pm
Edward Leigh (Gainsborough, Conservative)
To be frank, I do not think that that is a serious point. Everybody knows that the hon. Gentleman is trying to tilt at windmills. Things are getting worse,
because the United Kingdom’s level of influence on new financial rules has decreased. Regulation is now geared less towards financial services growth, and more towards curtailing financial market economy. The perception in many continental capitals—there may be a reason for this—is that the so-called Anglo Saxon light-touch capitalism needs to be reined in. In the past, EU politicians and policy makers generally, but not always, felt constrained from imposing financial regulation on the UK, but that has now ceased to be the case. I agree that United Kingdom regulation has moved from the light-touch concept, but its new focus on regulatory judgment looks set to clash with the prevailing rules-based culture at the EU. In addition, the eurozone crisis is increasingly likely to create exceptional needs and political incentives for the euro countries to act in the interests of their own eurozone of 10.
I believe that all those reasons—the new emphasis on qualified majority voting, our inability to use our veto in this marketplace, and the increasing tendency of the European Union to want to interfere in the financial marketplace—are as big a threat to the main motivator of our economy as anything that we have seen in history. What do we do about it? I think that this is a decisive moment for the Prime Minister. He has to say in the conference that he is not prepared to sign any treaty unless he receives cast-iron guarantees that our financial sector will be set free from interference. If he does not get such cast-iron guarantees, I believe that he must be prepared to veto any treaty. If he is then told that the 10 will go ahead and create their own treaty, he must declare that illegal. Although that may sound like a very dramatic thing to do, I have read in today’s papers that German commentators are already talking about even the threat of our Prime Minister standing up for British national interests as being “obnoxious,” but that is precisely what all European countries do. The first lesson of history, as I have said, is the overwhelming imperative on behalf of successive British Governments over the centuries to protect our commercial interests. The second lesson of history is that all Governments in Europe act in their own financial interest—all are determined by their own history.
We need not say much about recent German history, but we know that there is an imperative throughout German history to extend their marketplaces, particularly into the east in the Balkans. We know that there is an imperative on behalf of French Governments to hug Germany close, so the French President and German Chancellor will be acting entirely in their own national interest, which is what we demand of our Prime Minister.
I hope I will be forgiven for saying this, but we have had enough of spin and of reading about British Prime Ministers who, over the past 20 or 30 years, have said in the days preceding a summit that they will stand up for British national interests and ensure that they are protected, only to come back with a Chamberlain-esque piece of paper, saying, “I have negotiated very hard, got an opt-out from this and that, and succeeded in standing up for British interests,” when such guarantees are not worth the piece of paper they are written on. I suspect that agreements have already been made among the sherpas and the miners, and that our Prime Minister will be offered something, but that will not be enough
unless it includes cast-iron guarantees that we can all accept and that protect our vital national interests, particularly those in relation to our financial sector.