My Lords, now that the clouds have belatedly lifted from that Mount Olympus where the gods known to us as "the usual channels" meet, and a debate on the outcome of the European Council of
Today's debate is also a serious case of "Hamlet" without the Prince of Denmark, for reasons that my noble friend Lord Kerr has explained. Why is this so? At no stage have the Government brought to the attention of either House of Parliament, or of either House's scrutiny committee, the text of the protocol on financial regulation that they are widely reported to have tabled at the December European Council, and which appears to have been rejected on that occasion by 26 out of the 27 member states. I can understand why the Government should not be particularly keen to draw attention to that lamentable fiasco. What I cannot understand is by what procedural sleight of hand they can possibly justify failing to convey to Parliament the text of an instrument that was clearly intended to be a piece of EU legislation, and which, had it been adopted, would have altered in a number of respects the further development of the financial regulatory framework which is the object of today's debate.
I very much hope that the Minister will be able to fill this lacuna in our evidential base and perhaps he might place in the Library of the House tomorrow the text of this famous protocol, which clanks in and out of our debate rather like the ghost of Hamlet's father. I very much hope that he will also be able to explain to the House why this lacuna has been allowed to occur in the first place. I really cannot see how the House can be expected to perform its required function of overseeing and scrutinising EU legislation if our own Government do not convey to it the text of a piece of EU legislation which it tabled itself. There are plenty of words to describe that action, some of which are not of a very parliamentary kind. "Respect for Parliament" is not an epithet that could be applied to it.
The report before us has some wise things to say about the financial industry being highly mobile, and about global co-operation being essential to ensure that parts of that industry do not relocate outside the EU. This consideration is highly germane to the proposed financial transactions tax, which I appreciate is not covered by this report. Am I correct in assuming that the proposed Tobin tax will be discussed at the next meeting of the G20 finance ministers in February and, if so, that that should provide a clear indication of whether there is any prospect of such a tax being adopted globally? If there is no such prospect-and the chances of the present US Congress enacting a new tax in an election year must be remarkably slender-the risks for the EU, the eurozone or any of its members that decide to go ahead on their own will become very clear, and would bring the rather unworldly debate on this issue down to earth.
Chapter 4 of the report before us is devoted to the UK's influence on EU legislation in the field of financial services. As other noble Lords have said, Britain is the EU's centre of this major industry and it is therefore clearly of the utmost importance that Britain's influence should be deployed both wisely and effectively. Shortly before the December European Council, one of the Government's supporters in the other place, Mr Jo Johnson, argued in an article in the Financial Times that the last thing London's financial services industry should want was to be wrapped in the union jack-how wise he was.
If only the Government had paid attention to him-but they did not. The least that can be said about the manoeuvring at the December European Council is that it does not make the task of deploying that influence any easier. But it could be a good deal worse than that. The risks of marginalisation are very real, and the Government have yet to explain convincingly how they propose to avoid them. Perhaps the Minister will either do that when he replies to this debate or will take the matter away and reflect-I have no doubt that we will return to this on
Altogether it is not easy to be optimistic about the developments in this field of financial regulation and supervision. The earlier unity of purpose in the G20 seems to be ebbing away-taking with it the prospects for strengthening the world's defences against the next crisis when it comes along. There is a widely perceived leadership vacuum which is sapping the chances of restoring confidence in the financial markets. The people who cheered the loudest at the lamentably inadequate outcomes of the G20 summit in Cannes, and of the December European Council, actively want the eurozone to collapse and want Britain out of the European Union-either of which courses would have extraordinarily damaging consequences both for this country and for London's financial services industry. It is surely time that the Government recognise that their mantra "we are all in this together" applies beyond the boundaries of this nation.