European Union Economic Governance

Part of Support and Protection for Elderly People and Adults at Risk of Abuse – in the House of Commons at 6:26 pm on 10th November 2010.

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Photo of Douglas Carswell Douglas Carswell Conservative, Clacton 6:26 pm, 10th November 2010

I shall be brief, and I shall vote against the motion. The House is being asked to endorse an agreement that would strengthen European Union economic governance. It is not in dispute that the new measures would give EU institutions, the Commission and the Council greater powers. What is in dispute is, first, the extent to which such changes would involve the United Kingdom, and whether the new arrangements would apply only to the 16 members of the eurozone, or to all 27 member states, including Britain.

The second point of contention is the extent to which Britain is now subject to EU oversight when we set our own Budget. Having gone to Brussels promising not to give away so much of our money, Ministers seem to have returned having given Brussels the right to have a say in how we spend the rest of our Budget.

No one was more heartened than I to hear the Prime Minister tell the House back in June that any new deal with the EU

"should not interfere with national competencies".

He also said:

"On budget surveillance, let me be clear: the UK Budget will be shown to this House first and not to the Commission...co-ordination and consultation, yes; clearance, no, never."-[ Hansard, 21 June 2010; Vol. 512, c. 35.]

Such assurances were welcome, yet within a couple of weeks we heard Olli Rehn, the Economic and Monetary Policy Commissioner, spell out the details. He said:

"All member states would submit their fiscal programmes at the same time in April to allow the Council to issue country specific policy guidelines".

Is it any wonder that when the Chancellor appeared before the Treasury Select Committee he was able to reveal the date of the next Budget? It is now part of a timetable set in Brussels.

Ministers have claimed that the level of disclosure is nothing new, and that it is no more than what a think-tank might find out about UK fiscal policy via Google. Indeed, but think-tanks do not have the power to issue guidelines, and they cannot pass legislation on the basis of the analysis that they then make.

Ministers are keen to tell us that as a result of the new arrangements Britain would not at this time be subject to sanctions. To the best of my knowledge, no one is suggesting otherwise. The issue at stake is not whether the new EU regulations apply sanctions to the UK, but whether, from now on, the EU has the right to make laws on UK fiscal policy in the first place.

At his press conference on 17 June, the Prime Minister assured us that because we are outside the eurozone our opt-outs would be safeguarded. He talked of Van Rompuy's efforts to "strengthen Eurozone governance arrangements". He referred to the eurozone, not the EU. Since then, the talk has been not of eurozone economic governance arrangements, but of EU governance arrangements. Within a couple of weeks of the Prime Minister's assurances, talk shifted from measures that would affect just the 16 eurozone members to measures that would apply to all 27 member states, including Britain.

Angela Merkel made it clear that economic governance should apply to all EU states, not just the eurozone. Barroso declared with reference to economic governance:

"Europe must show it is more than 27 different national solutions".

He said 27, not 16. It is clear that his intention is that the new arrangements apply to the UK. Van Rompuy went out of his way to warn against creating what he called "dividing lines" between 27 member states and 16 eurozone countries. What were clear assurances to be welcomed and embraced in early summer had, by the onset of autumn, become dividing lines to be done away with.

Paragraph 34 of the Van Rompuy report states that there will be a new legal framework

"applying to all EU Member States".

Can the Minister explain what part of "all" excludes Britain? Regardless of paragraphs 35 and 39, or reference to protocol 15 of any treaty, such wording creates ambivalence at the very least. It suggests that EU institutions will now be able to legislate in areas of UK national competence in which they could not previously legislate. Has the precedent now been set? Is the field occupied? Is not the stage set for the day when some other Minister returns from Brussels to explain to the House how we have been sadly outvoted?

So who is right? Ministers who assure us, or Eurocrats who do not? How can we explain the differences between Ministers' assurances and what lies in the small print of what is before the House today? At best, this can be explained by sloppy drafting by officials, but if that is the case, why are we employing sloppy drafters to negotiate matters of such fundamental importance? Are those officials the ones on whom we will depend to turn the contents of the Van Rompuy report into the treaty changes? I cannot support the motion, as it will mean a further transfer of powers from this country to Brussels. I urge colleagues to oppose it.