New Clause 3 — Report on the impact of the European Stability Mechanism on the economic performance of the European Union

Part of European Union (Approval of Treaty Amendment Decision) Bill [Lords] – in the House of Commons at 7:56 pm on 10th September 2012.

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Photo of Wayne David Wayne David Shadow Minister (Justice) (Political and Constitutional Reform) 7:56 pm, 10th September 2012

I think that most people in this country are concerned about its economic well-being. Yes, they are concerned about our national sovereignty; even people who describe themselves as pro-European do not want to give up British sovereignty. Many people see the European Union as essentially a mechanism to pool sovereignty in the collective best interests of those who live on that continent. It is important for that spirit to be carried forward in how we relate to the current difficulties in the eurozone.

I generally welcome the pragmatic way in which the Government have gone about establishing the ESM. As the Minister said, nobody would claim for one moment that the ESM, by itself, will solve the problems of the eurozone—it will not—but it is one important step towards resolving them. I therefore hope that this House will give its endorsement to it. However, to take his comments further, the ESM is not enough. It must be monitored, examined and possibly extended in some way if there is a need for that in future, but we must also pursue policies collectively that will enhance the competitiveness of the European Union.

Just as importantly, we need a growth strategy. That is the crucial issue that faces the peoples of all countries within the European Union. If recent history teaches us anything, it is that austerity by itself is not enough. It is not enough in this country—that is why we are in a double-dip recessions—or in the eurozone. I very much hope that there will be an increasing question mark over the German-led policy of austerity above all else. We need to make sure not only that we have reasonable public finances, that the debt burden on our neighbour countries is reduced and that there is competitiveness, but that our economies are collectively stimulated. That is in the best interests of this country. I believe that if the ESM is agreed, it will be an important step towards a more prosperous Europe for us—but it is only one step.