My Lords, I join other noble Lords in welcoming the Motion moved by my noble friend. As the noble Lord, Lord Stoddart, said, few more important questions face us at this time. The reason for that is that, week by week and year by year, we face a huge number of decisions on how we participate in Europe, including, later this year, the issue of the constitution itself, which other noble Lords have mentioned. It surely cannot be sensible to enter those negotiations and agree outcomes without a clear view of what is at stake and what are the alternatives to proceeding with that option.
As other noble Lords have said, the Government's tactic tends to be to assert that there is simply no alternative to signing up to whatever option is offered from Europe, other than full withdrawal. It is then argued that such a step would be economically and politically disastrous, and that those who question the benefits are therefore extremists whose questions can safely be dismissed. I reject that form of response to an attempt to have an intelligent debate on matters of such crucial importance.
I cast my case for the Motion in the context of current discussion under way in Europe and the reality that there must be a high probability that failure to reach an agreement on the proposed constitution acceptable to all—in particular, if it is vetoed by Britain or other countries—will inevitably drive practical consideration of what has in the past been called a multi-tier Europe. We cannot assume that Europe will from this point on always proceed at a uniform pace or in a uniform way. A multi-tier Europe is a likely outcome—whether now or at some point during the next few years. That is what my noble friend Lord Hurd has previously called variable geometry.
I believe that there is nothing wrong with that; indeed, it is probably highly desirable, because we must recognise that different countries in Europe have different needs and that different outcomes are likely to suit their interests. There may be many in Europe with different situations from that of Britain who would benefit from a higher level of integration than that from which many of us believe that Britain would benefit.
If we are to participate in such discussions, as and when they appear on the agenda—which I believe is likely to be sooner rather than later—we must decide what kind of tiers we want to help shape in a multi-tier Europe and which of those tiers bests suits our interests. That means that we need clarity about what aspects of the current European Union are in our favour; and clarity about which aspects, on balance, we would rather be outside.
I am sure that there is general agreement in the House that many things occur alongside our membership of the European Union that we would want to preserve under any scenario—in particular, the notion of free trade across Europe and as much of the world as we can achieve. That applies similarly to co-operation on aspects of crime, security and other matters that cross national borders. None of those things is in doubt. The question is: how much of the current European Union overheads do we need to deliver those benefits; and what burdens imposed by those overheads do we not need?
Let us take the single market as an example. It is clearly desirable to have as low a level of tariffs across Europe as possible. The truth is that, since the European Union was founded, tariffs have dropped across all global trade. Several countries outside the European Union now achieve as favourable terms with our European partners as we do, without being part of the European Union. Yet the costs of the single market are now significant.
Thousands of regulations are imposed every year—many of them introduced into UK law without effective scrutiny. Can the Minister tell us how many regulations originating in European legislation have been passed into UK law during the past 12 months; and whether on that narrow aspect the Government have any estimate of the cost to British business? Despite the fact that we are all in favour of free trade, it is reasonable now to ask what are the benefits of additional trade that we may achieve in Europe through being a member of the single market, versus the loss of trade elsewhere that may arise because of diminished competitiveness due to those regulations.
As other noble Lords have said, we should enter that discussion recognising that the European Union accounts for less than 10 per cent of Britain's GDP and that, as my noble friend Lady Cox pointed out, the European Union will actually be one of the slowest growth areas for trade in the coming years. It will be China, India, Russia and similar countries that will drive world growth during the next 50 years. They are where our future lies.
Germany, by contrast, will have flat or close to flat GDP during the next 20 years, if current forecasts are to be believed. If its productivity continues at no more than 1 per cent a year, or thereabouts, and its population in work declines by 1 per cent a year, simple maths says that it can look forward to little growth in its overall economy during that period. So we must be clear in a hard-headed manner about where our interests lie against the true engines of world and British growth in the years ahead.
As other noble Lords have said, beyond the single market there are huge questions about the benefits that we may achieve from our membership of the common agricultural policy, the common fisheries policy and other common policies. If we were constructing Europe today—and if, as I believe, we have the chance to construct a new Europe now that better suits our needs—would the Government choose to be a member of the common agricultural or fisheries policies? If not, may we see the benefit analysis that justifies that decision; or their arguments why we should continue our membership? It is not a question of dismissing them as part of a "take it or leave it" package; we have the opportunity now to shape a new Europe. Let us shape it around our interests, not around the false argument that we must accept everything or nothing.
The final argument made against the proposal, as the noble Lord, Lord Hannay, said, is that because we cannot estimate something to decimal places, it is not worth doing. In my experience, there are few very important questions to which one cannot get approximate answers and an approximate analysis. This is a case in point: we do not need the answer to decimal places. If the Government set up such an inquiry, it should be able to give a ballpark estimate that would at least give direction to the debate. If I am wrong, and such an inquiry could not come up with such an analysis, the Government should admit that neither they nor we know, rather than continuing to assert that the evidence of benefits is so overwhelming. If it cannot be proved, we must all accept that the answer is unknown.
The only conclusion that one can reach is that the Government are afraid of the analysis. Surely, it is almost a dereliction of duty to negotiate the kind of steps being proposed without at least attempting an analysis. I hope, therefore, that the Minister will concede to Parliament the kind of analysis for which my noble friend's Motion calls.