EU Growth and Stability Pact

– in the House of Lords at 3:31 pm on 28 February 2002.

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Photo of Lord Saatchi Lord Saatchi Conservative 3:31, 28 February 2002

My Lords, I beg leave to ask a Question of which I have given private notice, namely:

Whether Her Majesty's Government are satisfied with the operation of the EU growth and stability pact.

Photo of Lord McIntosh of Haringey Lord McIntosh of Haringey Deputy Chief Whip (House of Lords), HM Household, Captain of the Queen's Bodyguard of the Yeomen of the Guard (HM Household) (Deputy Chief Whip, House of Lords)

My Lords, we have said consistently that we support a prudent interpretation of the stability and growth pact, taking into account the economic cycle, sustainability and the important role of public investment.

Photo of Lord Saatchi Lord Saatchi Conservative

My Lords, is it not regrettable that an important White Paper was published this morning and not made the subject of a Statement in both Houses of Parliament? In view of that, will the Minister ensure that an early debate on the White Paper takes place in your Lordships' House?

Are we not witnessing, in the words of the Chancellor this morning, a crude attempt by the Government to rewrite the EU's convergence programme and the rules of the EU growth and stability pact by including or omitting figures to suit themselves? Is that not because the Chancellor can see from today's published zero growth figures for the UK economy that the public finances are heading into a massive deficit, even more horrendous than the £54 billion of borrowing already planned over the next four years?

There are EU rules. The Government are in breach of them. What is their solution? It is to change the rules. Is that not what the Chancellor's words this morning really meant?

Photo of Lord McIntosh of Haringey Lord McIntosh of Haringey Deputy Chief Whip (House of Lords), HM Household, Captain of the Queen's Bodyguard of the Yeomen of the Guard (HM Household) (Deputy Chief Whip, House of Lords)

My Lords, I resist the suggestion that the Chancellor behaved in any way improperly or discourteously towards the House of Commons. He went out of his way to ensure that he was able to unveil the White Paper personally to the House of Commons. He agreed to the Speaker's request that he should defer answering the first Question until the end of Treasury Questions in order that there should be sufficient time for him to make a Statement on the White Paper and for there to be debate on it. Of course, the White Paper has been available in the Printed Paper Office and the Vote Office since 11.30 a.m. today.

I also resist the suggestion that there is any way in which this country is in conflict with the stability and growth pact. We are in conformity not only with our own fiscal rules but also well within the criteria of the stability and growth pact. When the noble Lord, Lord Saatchi, refers to zero growth, he is referring to this morning's headlines, which relate only to the fourth quarter of last year. Growth in the whole of last year was of course within the margins which we set for ourselves and which we expected both in the Budget last year and in the Pre-Budget Report. As the noble Lord knows, this country has been outstandingly successful in resisting the dangers of volatility in global economies.

Photo of Lord Peston Lord Peston Labour

My Lords, although one has had only a couple of hours in which to examine this document, is my noble friend aware that it is a remarkably interesting and important document? It raises almost every important question confronting our country in the economic sphere and the European Union. I am genuinely surprised that the noble Lord, Lord Saatchi, takes such an acid view of the document. It does not hide anything. Quite the contrary; it exposes almost everything that needs to be exposed.

None the less, is my noble friend aware that I agree with the noble Lord, Lord Saatchi, on one matter; namely, that this document is so important—I am not sure what my noble friend the Chief Whip is about to say—that, instead of wasting a whole day on the trivial matter of foxhunting, if your Lordships' House is to have any future, and in my black moods I sometimes wonder whether it has, we should give a debate on this subject absolutely top priority? I hope that my noble friend will speak to my noble friend the Chief Whip on the matter and press him on it.

Photo of Lord McIntosh of Haringey Lord McIntosh of Haringey Deputy Chief Whip (House of Lords), HM Household, Captain of the Queen's Bodyguard of the Yeomen of the Guard (HM Household) (Deputy Chief Whip, House of Lords)

My Lords, my noble friend Lord Peston rightly reminds me that I did not respond to the point raised by the noble Lord, Lord Saatchi, about a future debate. Of course, as the House knows, that is a matter for the usual channels. Personally, I should be very happy to have a debate on this subject.

My noble friend is entirely right about the content of the White Paper. It was promised in the Chancellor's speech to the CBI in November last year. It addresses the reforms which are necessary in Europe in our labour, capital and product markets in order to increase competition and modernise the European economy. Those are matters of the most profound importance and they will be of great importance at the Barcelona Summit meeting and beyond. They were foreshadowed in the Lisbon Summit.

Photo of Lord Newby Lord Newby Liberal Democrat

My Lords, I support both noble Lords who have already spoken in pressing for time to be given to a debate on this subject. I hope very much that the Minister will speak to his noble colleagues in the usual channels, just as I shall speak to mine, in order to press that case.

Does the noble Lord agree that if we are to have growth and stability in Europe, the level of the currency and whether we are to join the euro, which we debated earlier, will be only one factor in determining whether growth and stability come about? This White Paper, whether or not one agrees with everything in it, deals with the other factors which will be crucially important; that is, the way the labour markets work, the way the capital markets work, and, indeed, Europe's place within the world. Therefore, given the importance of all those issues within the context of the development of the EU, I return to my first point: we should have more time in which to discuss the matter.

Photo of Lord McIntosh of Haringey Lord McIntosh of Haringey Deputy Chief Whip (House of Lords), HM Household, Captain of the Queen's Bodyguard of the Yeomen of the Guard (HM Household) (Deputy Chief Whip, House of Lords)

My Lords, I have already indicated my personal sympathy with that view. I am glad to hear that the noble Lord will express the same view to his own Chief Whip. I do so now.

Of course, these issues are of far greater significance in terms of what we can do about them than the matter which we debated in Starred Questions on Tuesday and today. That brings us back to the very important debate which we must continue to have on whether we comply with the five economic tests which the Chancellor has set.