Clause 1 - Referendum on the United Kingdom’s membership of the European Union

European Union (Referendum) Bill – in a Public Bill Committee at 4:51 pm on 17 July 2013.

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Photo of Emma Reynolds Emma Reynolds Shadow Minister (Foreign and Commonwealth Affairs) 4:51, 17 July 2013

I beg to move amendment 30, in clause 1, page 1, line 2, leave out ‘is to’ and insert ‘may’.

Photo of Joe Benton Joe Benton Labour, Bootle

With this it will be convenient to discuss the following:

Amendment 31, in clause 1, page 1, line 3, at end insert—

‘if there is a further transfer of power from the United Kingdom to the European Union’.

Amendment 32, in clause 1, page 1, line 3, at end insert—

‘(1A) A transfer of power is defined in Schedule 1.’.

Amendment 33, in clause 1, page 1, line 4, leave out subsection (2).

Amendment 2, in clause 1, page 1, line 4, leave out ‘before 31 December 2017’ and insert ‘on a date to be determined’.

Amendment 3, in clause 1, page 1, line 4, leave out ‘before 31 December 2017’ and insert—

‘on a date to be determined by a Royal Commission on the future of the United Kingdom in Europe’.

Amendment 4, in clause 1, page 1, line 4, leave out ‘before 31 December 2017’ and insert ‘on 22 May 2014’.

Amendment 5, in clause 1, page 1, line 4, leave out ‘before 31 December 2017’ and insert ‘on 6 May 2015’.

Amendment 6, in clause 1, page 1, line 4, leave out ‘before 31 December 2017’ and insert ‘before 31 December 2014’.

Amendment 7, in clause 1, page 1, line 4, leave out ‘before 31 December 2017’ and insert ‘before 31 December 2015’.

Amendment 8, in clause 1, page 1, line 4, leave out ‘before 31 December 2017’ and insert ‘before 31 December 2016’.

Amendment 9, in clause 1, page 1, line 4, leave out ‘before 31 December 2017’ and insert ‘before 1 July 2017’.

Amendment 10, in clause 1, page 1, line 4, leave out ‘before 31 December 2017’ and insert ‘before 31 December 2018’.

Amendment 11, in clause 1, page 1, line 4, leave out ‘before 31 December 2017’ and insert ‘before 31 December 2019’.

Amendment 12, in clause 1, page 1, line 4, leave out ‘before 31 December 2017’ and insert ‘on the date of the General Election in May 2020’.

Amendment 13, in clause 1, page 1, line 5, leave out from ‘shall’ to end of line 6 and insert—

‘establish a Royal Commission to consider the arrangements for and timing of the referendum and recommend the date or dates on which the referendum is to be held.

(3A) The Royal Commission established under section 1(3) is to report to the Secretary of State within 24 months of its establishment.

(3B) The Secretary of State shall introduce legislation to enact recommendations of the Royal Commission.’.

Amendment 28, in clause 1, page 1, line 5, leave out from ‘shall’ to end of line 6 and insert—

‘establish a Royal Commission to consider the arrangements for and timing of the referendum and recommend the date or dates on which the referendum is to be held.

(3A) The Royal Commission established under section 1(3) is to report to the Secretary of State within 18 months of its establishment.

(3B) The Secretary of State shall introduce legislation to enact recommendations of the Royal Commission.’.

Amendment 29, in clause 1, page 1, line 5, leave out from ‘shall’ to end of line 6 and insert—

‘establish a Royal Commission to consider the arrangements for and timing of the referendum and recommend the date or dates on which the referendum is to be held.

(3A) The Royal Commission established under section 1(3) is to report to the Secretary of State within 12 months of its establishment.

(3B) The Secretary of State shall introduce legislation to enact recommendations of the Royal Commission.’.

Amendment 34, in clause 1, page 1, line 5, leave out ‘, and before 31 December 2016,’.

Amendment 36, in clause 1, page 1, line 6, at end insert—

‘(3A) The Secretary of State shall appoint the date on which the referendum is to be held at least 28 weeks in advance of the proposed polling day.’.

Amendment 37, in clause 1, page 1, line 7, after first ‘The’, insert ‘only’.

Amendment 38, in clause 1, page 1, leave out lines 8 and 9 and insert ‘“Should the United Kingdom remain a member of the European Union?”’.

Amendment 14, in clause 1, page 1, line 8, leave out ‘should be’ and insert ‘should remain’.

Amendment 16, in clause 1, page 1, line 8, leave out ‘be a member of’ and insert ‘leave’.

New schedule 1—‘Transfer of powers

1 Subject to section 1(a), a “transfer of power” involves one or more of the following—

(a) the extension of the objectives of the EU as set out in Article 3 of the Treaty on European Union;

(b) the conferring on the EU of a new exclusive competence;

(c) the extension of an exclusive competence of the EU;

(d) the conferring on the EU of a new competence shared with the member states;

(e) the extension of any competence of the EU that is shared with the member states;

(f) the extension of the competence of the EU in relation to—

(i) the co-ordination of economic and employment policies, or

(ii) common foreign and security policy;

(g) the conferring on the EU of a new competence to carry out actions to support, co-ordinate or supplement the actions of member states;

(h) the extension of a supporting, co-ordinating or supplementing competence of the EU;

(i) the conferring on an EU institution or body of power to impose a requirement or obligation on the United Kingdom, or the removal of any limitation on any such power of an EU institution or body;

(j) the conferring on an EU institution or body of new or extended power to impose sanctions on the United Kingdom;

(k) any amendment of a provision listed in Schedule 1 that removes a requirement that anything should be done unanimously, by consensus or by common accord;

(l) any amendment of Article 31(2) of the Treaty on European Union (decisions relating to common foreign and security policy to which qualified majority voting applies) that removes or amends the provision enabling a member of the Council to oppose the adoption of a decision to be taken by qualified majority voting;

(m) any amendment of any of the provisions specified in paragraph 3 that removes or amends the provision enabling a member of the Council, in relation to a draft legislative act, to ensure the suspension of the ordinary legislative procedure.

2 A transfer of power also includes a reference to the removal of a limitation on a competence.

3 The provisions referred to in paragraph 1(m) are—

(a) Article 48 of the Treaty on the Functioning of the European Union (social security),

(b) Article 82(3) of the Treaty on the Functioning of the European Union (judicial co-operation in criminal matters), and

(c) Article 83(3) of the Treaty on the Functioning of the European Union (particularly serious crime with a cross-border dimension).

4 A treaty or Article 48(6) decision does not fall within this section merely because it involves one or more of the following—

(a) the codification of practice under the Treaty on European Union or the Treaty on the functioning of the European Union in relation to the previous exercise of an existing competence;

(b) the making of any provision that applies only to member states other than the United Kingdom;

(c) in the case of a treaty, the accession of a new member state.’.

Photo of Emma Reynolds Emma Reynolds Shadow Minister (Foreign and Commonwealth Affairs)

Amendment 30 would provide for a referendum on our membership of the EU to be discretionary, not mandatory. Other amendments in my name relate to my contention that a referendum should be held if there is a significant transfer of power. In fact, I have tabled new schedule 1, to which amendment 32 points, relating to transfers of power.

Some of my other amendments and those of my hon. Friends relate to the timing of any referendum. I am concerned in particular about the arbitrary nature of the date of 31 December 2017. Amendment 36 would ensure that the Secretary of State gives at least 28 weeks’ notice of any polling day.

There are also various amendments—one in my name—to the nature and in particular the wording of the question that would be put should the Bill become law. As I said in our discussion on the sittings motion, the question is a really important part of our considerations today. The amendments on clause 1 are wide ranging, and my arguments will fall into different categories.

My first argument is that the referendum commitment should be discretionary, not mandatory. My second argument, which is in regard to the timing of a referendum, is that there are economic risks in pledging a referendum for four years’ time. My third argument is that the EU itself is in a state of flux, with eurozone member states wishing to integrate their economies more closely. My fourth argument is about why we should have a referendum now when there has not been a recent transfer of power. We did not have a referendum in the 1980s on the Single European Act or in the ’90s on the Maastricht treaty. Referendums could have taken place when the Conservatives were in government.

My fifth argument is about enlargement, and I will come on to that. My sixth argument is about how I think the referendum commitment in the Bill actually weakens the position of our Government. My seventh argument will be about the wording of the question, and my eighth argument will be about parliamentary sovereignty.

Photo of Jim Dowd Jim Dowd Labour, Lewisham West and Penge 5:00, 17 July 2013

On the question of the question, has my hon. Friend noticed that the only significant deviation from the prototype Bill that was issued by the Conservative party was the change in its wording to remove the word “remain”?

Photo of Emma Reynolds Emma Reynolds Shadow Minister (Foreign and Commonwealth Affairs)

I did notice that substantial change, and I will come on to it in a bit more detail in my remarks. If we are to believe what we read in the Daily Mail, and I am not saying we should—the hon. Member for Stockton South might want to put this right because I am saying only that it is a rumour; I am not saying that it is the truth—Eurosceptics in the Conservative party were concerned that including the word “remain” would lead people to vote for the status quo.

Obviously, there are many Conservative Members who do not want the status quo. In fact, a large number of Conservative Members want the UK to leave the European Union. I do not know whether the rumour of the reason for the change is true, but my hon. Friend raises a valid point. As I understand it, that is the only difference between the draft Bill that we saw during the course of the Queen’s Speech debate and the Bill that is before us today.

My first argument is central to amendment 30: the Bill should not make a referendum compulsory. None of us know who will be in government in 2017. There might be a majority Labour Government, a majority Conservative Government, or a coalition of some kind—

Photo of Emma Reynolds Emma Reynolds Shadow Minister (Foreign and Commonwealth Affairs)

There might be a Liberal majority—who knows? The hon. Member for Cheltenham might be involved in the next Government. We simply do not know which party or parties will form the Government in 2017, so it is not appropriate for this Parliament to seek to bind the next one on this extremely important constitutional matter.

When we have had referendums in the past—I cannot think of an exception, but if hon. Members know of one, I will be interested to hear about it—they have been carried forward from an election manifesto commitment. That was what happened with the alternative vote  referendum, and it is what I understand happened in 1975. Let us not forget that, as my hon. Friend the Member for Lewisham West and Penge said, only a Labour Government have given this country a say on the European Union.

Photo of Martin Horwood Martin Horwood Liberal Democrat, Cheltenham

As another little point of information—I seem to be correcting people’s perception of Liberal Democrat policy, so we obviously need to communicate it a bit more clearly—the Liberal Democrats have never been committed to anything on the alternative vote. We remain in favour of the single transferable vote and multi-member constituencies, which was what was in our manifesto. That policy was something of compromise that we were perhaps unwise to accept, which is a lesson for the future.

Photo of Emma Reynolds Emma Reynolds Shadow Minister (Foreign and Commonwealth Affairs)

I apologise on the point of detail, but I am trying to make a point of principle. Perhaps a more accurate description is that the Liberal Democrats’ 2010 manifesto advocated a referendum to change the voting system. If the Bill were to bind the next Parliament to hold a referendum, it would be a first, as far as I am aware, in this country’s constitutional history. Previously, there has always been a manifesto commitment before a referendum. That was the case when we had a referendum on Scottish devolution, as it was on the referendum regarding the then European Economic Community in 1975, and I am sure there are many other examples of which hon. Members with a longer history in the House will be aware.

It is my contention that this Parliament should not seek to bind the next one because we simply do not know which parties will be in power. I feel passionately about that, which was why I tabled the amendment. I do not believe that subsections (1) and (2) of clause 1 should stand in their current form. I would prefer the referendum not “to be held”, but that it “may be held”, which would create space for political parties to make a decision in due course, should they so desire. I also think that the date should not be set in stone.

The Prime Minister’s speech in January was billed as a major European set piece speech—we had been waiting for it since last year. It was trailed for various dates, but had been put off and put off to the extent that the shadow Foreign Secretary, the Leader of the Opposition and I were pretty clear that it would contain a referendum pledge regarding renegotiation. We were therefore not surprised by that element, but given the timing, I think it was added at the last minute, as my hon. Friend the Member for Lewisham West and Penge set out, as a political device to unite a deeply divided Conservative party on the question of whether we should be a member of the European Union. It is regrettable that the Prime Minister, and therefore the hon. Member for Stockton South, have chosen to set an extremely arbitrary date for a referendum on our membership.

Photo of William Bain William Bain Shadow Minister (Scotland)

My hon. Friend makes an excellent point. Does she have as much difficulty as me with clause 1, given that the Prime Minister said that it was intolerable to have four years of uncertainty in Scotland after the First Minister set some arbitrary deadline for a referendum? I find it very hard to reconcile that with the Bill.

Photo of Emma Reynolds Emma Reynolds Shadow Minister (Foreign and Commonwealth Affairs)

I am grateful to my hon. Friend for bringing me on to my second argument: the economic risks of setting in stone or pledging—even without the Bill—a referendum in four years’ time.

I seem to remember that when the Scottish National party won its majority, both the Prime Minister and the Chancellor urged the Scottish Government to come forward quickly with their referendum, although the Scottish Government did not want to hold it until 2014. Surely exactly the same logic that applied to the criticism by the Prime Minister and the Chancellor of such a period of uncertainty applies to the Bill’s provision setting a deadline of 31 December 2017 and the Prime Minister’s January pledge.

In fact, only two years ago, on 24 October 2011, the Foreign Secretary said on the “Today” programme that an in/out referendum

“would create additional economic uncertainty in this country at a difficult economic time.”

That was not the only time he suggested that the Conservative party should not give a pledge for a referendum, let alone one with an arbitrary timetable. He also told the House that

“the election manifesto on which we stood as Conservative Members was very clear about the referendum legislation that we would introduce and that, in a coalition, we have now passed into law”— that relates to a point made by the hon. Member for Cheltenham. The Foreign Secretary went on to say:

“We were also clear, having been asked about this many times during the election, that that did not include the option of an in/out referendum.”—[Official Report, 24 October 2011; Vol. 534, c. 56.]

We need to consider what has happened since October 2011, when there was a vote in the House. Government Members—or, I should say, Ministers and the payroll vote—voted against an in/out referendum, and a majority of Opposition Members, albeit not all, also voted against it. There was a significant Tory rebellion against the Government, but back in 2011, the Conservative position seemed to be crystal clear in not seeking a referendum on whether we should remain in or come out of the European Union. What happened between October 2011 and this May? As my hon. Friend the Member for Lewisham West and Penge set out, the vast majority of the Bill’s provisions were published in May, although the word “remain” has now been left out of the question. Perhaps the Minister for Europe will explain what changed in Conservative party policy and the minds of those running it.

I am deeply concerned that by setting out a pledge in the Bill for a referendum in four years’ time, the Prime Minister is putting in great jeopardy the economic future of our country. We are not in a good economic situation and we need vital foreign direct investment. I am glad to say that in the constituency of the hon. Member for South Staffordshire, which borders mine, Indian-owned Jaguar Land Rover is making a massive investment.

One of the principal drivers of the decision behind the location of that massive investment, which is the biggest that the area has seen for quite some time, is the fact that the UK is a gateway to the rest of the European Union, which is the largest single market in the world. If  we create doubt in the minds of those who are making such decisions, we could put at risk that investment, which will be so beneficial to my constituents and those of the hon. Member for South Staffordshire. Such things represent the greatest danger of the Bill, which comes at a time of great economic instability and merely adds to it. The Government and the Conservative party should bear that in mind, because this Government’s priority should be to get the economy back to growth.

That is why the referendum is not only a distraction, given that the Government should be concentrating on economic priorities, but prejudicial and damaging. It could put at risk much of the vital investment that we have seen throughout the country. We have Honda, Nissan and Toyota. We are one of the most open economies in the world, but we also benefit from being one of the largest economies in the largest single market in the world.

Photo of Gavin Williamson Gavin Williamson Conservative, South Staffordshire 5:15, 17 July 2013

Was the hon. Lady ever on record as being in favour of joining the euro for the same reasons that she is outlining? Was she in favour of joining the euro at some stage?

Photo of Emma Reynolds Emma Reynolds Shadow Minister (Foreign and Commonwealth Affairs)

I do not think that that is relevant to the Bill, but—[Hon. Members: “That hasn’t stopped you so far!”] Mr Benton, I beseech Government Members not to impugn my integrity with regard to whether I am speaking in order. I have been discussing my amendments for some minutes now and all my comments—you would have told me otherwise—have been in order.

Photo of Joe Benton Joe Benton Labour, Bootle

Order. It is worth repeating—I have said it twice already—that if I consider that any hon. Member is out of order, I will not fail to say so. The Opposition spokeswoman is not out of order.

Mr Sheerman rose—

Photo of Barry Sheerman Barry Sheerman Labour, Huddersfield

On that important point, I am a co-chair of the all-party group on manufacturing and the all-party group on Yorkshire and Northern Lincolnshire. My hon. Friend is right that committing ourselves to a long period of uncertainty over our European membership is increasing the concern of not only big players in manufacturing and other sectors, but also many SMEs. Those SMEs, which are very worried, have linkages with a whole stream of companies across Europe—well-established, long-standing supply chains and other such arrangements.

Photo of Emma Reynolds Emma Reynolds Shadow Minister (Foreign and Commonwealth Affairs)

I thank my hon. Friend for that intervention. He reminds me that the economic benefits of our membership are not solely to do with foreign direct investment, as the Bill could put the UK’s economic benefits through trade at risk in two significant ways.

The first is that the rest of the European Union is still our major trading partner—UK businesses export more to the rest of the European Union than to anywhere else in the world. The second risk is due to something that, ironically enough, we saw when the Prime Minister was in Washington and rushed the draft Bill across the Atlantic while we were debating the Queen’s Speech. Instead of engaging in that exercise in party management, he should have been talking to President Obama about  the US-EU free trade agreement, which will be highly beneficial to our country. If our membership is in doubt over four years, what is the point of us being in that free trade agreement? Will not our voice not be weakened in those important negotiations because the negotiators on both the US and EU sides will rightly wonder whether we are going to remain a member of the European Union?

Photo of William Bain William Bain Shadow Minister (Scotland)

Is my hon. Friend as alarmed as I am at the findings of a report by the Department for Business, Innovation and Skills, which was published in February 2011, that suggest that if we were excluded from the single market—that could happen if the Bill were passed and there was a no vote—our exports would be considerably fewer than if we were in the EU single market? Has she seen the figure on page 14 of the report showing that if we were outside the single market and it took down the rest of its trade barriers, our growth would be 7.4% lower over a 10-year period? Would not that be a devastating consequence of the Bill?

Photo of Emma Reynolds Emma Reynolds Shadow Minister (Foreign and Commonwealth Affairs)

I could not agree more with my hon. Friend. There is a significant risk that the Bill will derail the significant and important economic benefits that we currently derive from our membership of the European Union. My hon. Friend has pointed out some very serious, independent data about what would be lost if we were to leave the EU.

It is not only politicians such as myself and my hon. Friends making that point; other politicians are as well and I should mention those comments before I go on to what business leaders are saying. The Business Secretary—a member of the same party as the hon. Member for Cheltenham—said very clearly:

“Uncertainty is the enemy of investment.”

That shows that the Business Secretary is listening to businesses across the country: his comments, which were about this referendum pledge, are in line with what we have heard from business leaders. Sir Roger Carr, until recently the CBI president, said that

“the referendum builds in a degree of uncertainty and business never welcomes uncertainty.”

Sir Martin Sorrell, the chief executive of multinational advertising company WPP, who is reputed to support the Conservative party, not the Labour party, said in January of this year:

“A referendum adds to uncertainty—it doesn’t diminish uncertainty.”

He went on:

“I understand the PM’s predicament.”

So he was trying to be sympathetic.

“But a referendum creates more uncertainty and we don't need that. This is a political decision, not an economic decision. If I am looking at it from WPP, it isn't good news.”

Richard Branson, who is a highly successful entrepreneur and businessman, said something similar:

“An exit would be very bad for British business and the economy as a whole.”

Conservative Members need to consider the voice of business in this important debate, because the voice of business is warning that the legislation before us today could derail any economic recovery and further deepen the current economic instability.

Further to my second argument about the economic risks and benefits, I wish to make a final argument. The 2017 referendum commitment is damaging—this relates to the comment I made about the United States—because one of the brilliant and significant benefits of our membership is that we are part of an economic juggernaut of 500 million people and the biggest single market in the world.

Being part of that economic and political juggernaut helps us to negotiate with the United States—still by far the largest economy in the world, especially if we look at per capita—and it also helps in negotiations on free trade agreements, such as those that we have already concluded, for example, with South Korea, which brought very good economic benefits to our country. In fact, when I was in Washington two years ago, the Americans were annoyed that the European Union got there first, such is the advantage of our membership of the EU, which could be put in doubt because of this Bill.

Photo of Jim Dowd Jim Dowd Labour, Lewisham West and Penge

Does my hon. Friend recognise that the Prime Minister probably understands such things as well as she does? That is why he is somewhat critical of the referendum—not that it should be held, but that he looks forward to voting yes to remaining a member of the European Union.

Photo of Emma Reynolds Emma Reynolds Shadow Minister (Foreign and Commonwealth Affairs)

My hon. Friend makes a valid point. In his speech in January, the Prime Minister seemed to be at pains to reassure leaders of other member states that he really wanted to keep the UK in the European Union. However, he has also said that he wants a significant renegotiation. Although he did not mention this in his so-called Bloomberg speech, he has mentioned it to his own party and in the House that he wants a repatriation of powers.

Other European leaders have said we cannot have a pick-and-mix approach, so the other element of uncertainty is what the negotiating strategy prior to the date set out in this Bill—31 December 2017—will be. Let us say that the Conservative party wins a majority in 2015. We hope that it does not, but, for the sake of argument, let us say that it does. How will the Prime Minister deliver on his promises to his party in terms of repatriation and renegotiation while at the same time negotiating with his European partners? This is all part of the same argument about economic uncertainty. There is no way that the Prime Minister will be able to deliver for his party and simultaneously stay in the European Union. There is an unbridgeable gap between what the majority of hon. Members in his own party want in terms of renegotiation and repatriation and what he is likely to be able to negotiate. That adds even further to the uncertainty that I have been discussing.

Something else that adds to the uncertainty is the fact that high-profile members of the Government—the Secretaries of State for Defence and for Education—are on the record as saying they would vote to leave the European Union if there were a referendum tomorrow. My hon. Friend the Member for Lewisham West and Penge was right to point out that although the Prime Minister seemed at pains to say he wants to keep the  UK in the EU in his speech in January—it is unclear how he will do that and keep his party happy—senior members of his Government have said that if he does not get any change and if the status quo remains, they will vote to leave. That adds further to the uncertainty.

I return to the free trade agreements. I thank my hon. Friend for his intervention. I was talking about South Korea. A free trade agreement is still being negotiated with Canada, although it has hit a bit of a block in its progress. By setting a date in 2017 for the referendum, we are now uncertain whether we will be a beneficiary of that agreement when it goes through. Let us face it, we have free trade negotiations with countries such as Canada, the United States, Japan and India. The Government would rather the United Kingdom negotiates with the 28 members of the European Union alone. Free trade agreements will be more ambitious and more comprehensive for the United Kingdom, and more beneficial for business if we are part of the biggest trading block in the world. By implying that we might leave, and by pledging a referendum in four years’ time, we add uncertainty to those negotiations.

The biggest prize in free trade agreements is the agreement currently being negotiated with the United States. The UK could and should have a leading role in those negotiations. I believe in the special relationship in all sorts of policy areas, in particular defence and intelligence—although perhaps we should not talk about that, given recent events. We should be one of the leading lights in those negotiations. However, our ability to exercise influence is being put in doubt by the prospect of the Bill being put into law to legislate for a referendum in four years’ time.

I am uncertain—I would be grateful if Government Members can shed some light on this—why the year 2017 has been chosen. I know my hon. Friends have tabled amendments suggesting other years, and my hon. Friend the Member for Lewisham West and Penge said he is in favour of a referendum, so there is a variety of opinion on the Opposition Benches. But even my hon. Friend would admit that 2017 seems like an arbitrary date.

Photo of Jim Dowd Jim Dowd Labour, Lewisham West and Penge 5:30, 17 July 2013

My support is for a process that will ultimately lead to a referendum being put before the British people. The problem with this deeply defective and flawed Bill is that it specifies the finishing post without describing the rules of the game by saying what processes we will follow. Where will we be? Imagine we were in the midst of progressive and productive with our European partners in November 2017.

Would that all be thrown up in the air to meet this totally artificial and arbitrary date to appease a number of Conservative Back Benchers, who will vote no regardless of what comes back from Europe?

Photo of Emma Reynolds Emma Reynolds Shadow Minister (Foreign and Commonwealth Affairs)

That is absolutely right. Some of the leading advocates for a referendum want us to leave the European Union, and that is what they are about. That view is fine by me and we can have an argument about that, but I return to my point on the UK being the most open economy in Europe, because there is another interesting quote from the Foreign Secretary on that. In October 2011, he said:

“The eurozone is clearly in crisis, and to pile on that uncertainty the further uncertainty of a referendum on leaving the European Union, when half the foreign direct investment into Britain comes  from the rest of the European Union, and half our exports go out to the rest of the European Union, would not be a responsible action for Her Majesty’s Government to take.”—[Official Report, 24 October 2011; Vol. 534, c. 55.]

I agree with the Foreign Secretary. It is deeply irresponsible to commit to an in/out referendum, especially on some arbitrary timetable to 2017.

Importantly, in terms of the economic debate about the uncertainty and the December 2017 date, the Foreign Secretary continued:

“It would not help anyone looking for a job. It would not help any business trying to expand. It would mean that for a time, we, the leading advocates of removing barriers to trade in Europe and the rest of the world, would lack the authority to do so.”—[Official Report, 24 October 2011; Vol. 534, c. 55.]

I rest my case. I agree with the Foreign Secretary. His point was exactly the point I was making on the importance of the United Kingdom. I am sorry that the Europe Minister is not in his place, but he will know that it is essential that we get that point across in negotiations on free trade agreements. My fear is that, due to the Bill and the pledge for a referendum in 2017, the Government have weakened their hand in how they can use that level of influence.

Photo of Barry Sheerman Barry Sheerman Labour, Huddersfield

Has my hon. Friend considered that this level of uncertainty is not only bad for our economy, but will impact right across all our trading partners? They will all suffer from the uncertainty. There have been some interventions from members of the Committee saying this, but I, too, am very positive about the referendum.

Part of the attraction of being on this Committee and serving under your chairmanship, Mr Benton, was the opportunity to discuss the matter seriously and do all those things we are supposed to do as Members of Parliament. I was certainly not accepted on to this Committee to toe a particular line.

The issue is the uncertainty. I am someone who cares passionately about the manufacturing sector, which is at last starting to grow again. Large companies from all over the world are saying, “We can now start reshoring, because manufacturing can be done so efficiently now.” With highly sophisticated manufacturing capacity and a few skilled people, a lot of industry is coming back to this country, but as that is starting to happen, all this uncertainty is playing out. I give the Government their dues, however, because that reshoring is partly due to their policies.

I was with the Secretary of State for Business, Innovation and Skills for a horrendous 8 o’clock start this morning.

Photo of Barry Sheerman Barry Sheerman Labour, Huddersfield

Does my hon. Friend accept that point?

Photo of Emma Reynolds Emma Reynolds Shadow Minister (Foreign and Commonwealth Affairs)

I do accept that point. The economic benefits of our membership are clear to see, and we are seeing a revival in manufacturing. I am glad to say that that is the case in Wolverhampton and in south Staffordshire. I want to see that manufacturing revival continue, and that is one point we could all agree on. The Bill, and the behaviour of some senior Ministers, could threaten the manufacturing revival that we are  starting to see, and for my constituents and those of the hon. Member for South Staffordshire, that priority is high above anything that we have discussed so far today in terms of a referendum. The economy consistently comes top in the monthly polling when people are asked what their main concern is.

Photo of Pauline Latham Pauline Latham Conservative, Mid Derbyshire

Is it not true that the hon. Lady simply does not want to trust the people of this country?

Photo of Emma Reynolds Emma Reynolds Shadow Minister (Foreign and Commonwealth Affairs)

No, it is not true. I have sought every day since I was elected on the same day as the hon. Lady—

Photo of Emma Reynolds Emma Reynolds Shadow Minister (Foreign and Commonwealth Affairs)

—not five minutes ago, but three years ago, to represent the concerns of my constituents. I have had a handful of e-mails in those three years about a European referendum, but week on week in my advice surgeries and when I knock on doors canvassing in Wolverhampton, I rarely receive representations on the issue. My constituents, and I believe people across the country, are very concerned about the economy, and the monthly polling shows it is their top priority. This is relevant to the Bill, Mr Benton, because our constituents’ economic concerns should come first.

Let us not forget that the Prime Minister, in his first speech as leader of his party back in 2005, asked it to stop “banging on about Europe”, because that did not chime with the priorities of people up and down the country. He saw the disconnect between everyday people’s concerns and the obsession of the Conservative party. I agree with what he said in 2005, and I wish he had not changed his mind. Perhaps he was forced to change it, and got to this position out of weakness, not strength. I passionately believe that the Government, and Conservative Members, should focus on the economy, and I am genuinely fearful—I am not being party political here—about what this legislation will mean for our economy.

Photo of Barry Sheerman Barry Sheerman Labour, Huddersfield

I did not come here yesterday. I must apologise if I light-heartedly accused others of having come here yesterday; I know it was three years ago, but if one has been here 34 years, that seems like only yesterday. I apologise if any members of the Committee were offended by my remarks, which were meant in a lighter vein. Having been here quite some time, I remember when John Major was Prime Minister, and all this unhappiness and uncertainty about Europe really destroyed a British Prime Minister’s influence, and went on and on undermining the role that Britain played in Europe and in the world, and made for very weak government, and I am really afraid that we will repeat that process and be seen as a lame duck in Europe. Committing us to a referendum in 2017 is unheard of and very unsettling.

Photo of Emma Reynolds Emma Reynolds Shadow Minister (Foreign and Commonwealth Affairs) 5:45, 17 July 2013

It is both unsettling and damaging to our influence in Europe. I welcome my hon. Friend’s intervention.

As part of my role as shadow Minister for Europe, I go to different capital cities in Europe. I am afraid to report that the first question that parliamentary colleagues, the media and others ask me in other European member states is, “Is it likely, probable or inevitable that the UK will leave the European Union?” That is the first question that they ask me. It is not, “How can we work with the UK on a free trade agreement with the United States, or on legislation on climate change and the emissions trading scheme? How can we work with the UK on foreign policy?” Those are not the questions that come to me first when I meet my counterparts, journalists and think-tanks in other member states. The first question, which was unthinkable as recently as two or three years ago, is, “Is it inevitable that you will leave?” That damages our influence. Why should other European leaders and politicians bend over backwards to help the UK if the UK is going to leave anyway? I am afraid that that is the situation that the Government have got the UK into. The Bill is, unfortunately, a central part of that.

Photo of Martin Horwood Martin Horwood Liberal Democrat, Cheltenham

I can absolutely confirm what the hon. Lady says. Only today I met Herr Detlef Seif from the German Bundestag. He is not one of my fellow Liberals, but a member of the Christian Democratic Union. Again, the first question that he asked me was, “How serious are the Conservatives about pushing exit from membership? What exactly is happening on the referendum? What are the time scales? What are the political considerations in play?” It appalled him, as a member of moderate conservative party, which in other respects probably has quite a lot in common with the Conservative party—although it is a member of the European People’s Party, not the somewhat fringe group that the Conservatives are members of in the European Parliament—that a moderate conservative party like the Conservative party has got itself into such a tangle over European policy and feels the need constantly to issue such, rather knee-jerk, policies to appease its Eurosceptic right wing.

Photo of Emma Reynolds Emma Reynolds Shadow Minister (Foreign and Commonwealth Affairs)

My experience tallies with that of the hon. Gentleman. He makes a valid point.

I was talking about travelling to other European capitals. Many parliamentary colleagues from across the EU come here to visit us. The Speaker of the Dutch Parliament was here only the other week, and I am afraid to report that I had a similar conversation with her. The starting point, again, was, “Will the UK stay as a member?”

I cannot stress enough how worrying that is to our standing in the EU. The referendum commitment by the end of 2017 is central to the weakening of our position in the rest of the EU. I do not think that that is in the national interest. The leader of our party and the shadow Foreign Secretary have been clear that decisions of such a nature must be taken with regard to the national interest. They must not be taken with regard to how to paper over cracks and mend deep divisions in any political party.

Just to add to the uncertainty caused by the referendum pledge and that sense of weakening, I just want to quote the Dutch Foreign Minister, Frans Timmermans. He  recently said that the Prime Minister felt compelled for “purely internal political reasons” to renegotiate Britain’s relationship with Brussels, but that “walking away” was not the path to effective reform of the EU.

My party is keen to see significant reform of the EU. I am a pro-European, but I do not think that the EU is perfect. I worked in Brussels for six years, so I had direct experience of some of the imperfections at close range. However, if we are to deliver on reform—I think that this was the point that the Dutch Foreign Minister was making—we need to form meaningful alliances and partnerships with our European counterparts across the European Union.

Photo of Barry Sheerman Barry Sheerman Labour, Huddersfield

On that point, is my hon. Friend aware that, because we are going to sit very late tonight, I had to cancel a dinner meeting with a group from Denmark? The Danes think of us as some of their closest partners—[ Interruption. ]

Photo of Joe Benton Joe Benton Labour, Bootle

Order. The hon. Gentleman is making a point. The Committee must hear him.

Photo of Barry Sheerman Barry Sheerman Labour, Huddersfield

I was going to have dinner with some Danish people to discuss youth unemployment across Europe and what work we can do. The Danes love us being in Europe. They see us as partners. They are quite sceptical, as are some of my hon. Friends on the Opposition Benches. I am sceptical about some things. I want change and reform in Europe, but at the end of the day I want to stay in Europe. I am still happy for there to be a referendum; what I do not like is the uncertainty. Although I cannot meet my Danish friends this evening, I do not like having them laugh at me, saying, “What are you doing, dilly-dallying and dithering over whether you want to be in our club or out of it?”

Photo of Emma Reynolds Emma Reynolds Shadow Minister (Foreign and Commonwealth Affairs)

I thank my hon. Friend for his intervention, and I am sorry that it has not been appreciated by the Opposition. We must speak truth to power, even if power does not seem to like what we say.

I visited Copenhagen in April for a conference, along with the Leader of the Opposition and the shadow Foreign Secretary. We met with the Danish Prime Minister and Europe Minister. As my hon. Friend suggests, the relationship with Denmark should be close. We have opt-outs just as they have opt-outs for particular policies. In fact, they have opt-outs in areas, such as defence, where we do not. I am afraid to report that the first question that was put to us in our important meetings with our Danish counterparts was, “Is it inevitable that the UK is going to leave the European Union?” That is extremely regrettable, and part of the reason for it is the centrepiece of the Bill: a referendum pledge on a completely arbitrary timetable.

I have talked about the importance of manufacturing and the economic benefits of foreign direct investment in manufacturing. I would also like to talk about the City of London—[Interruption.]

Photo of Joe Benton Joe Benton Labour, Bootle

Order. It is most insulting for anyone speaking to have to suffer interruptions, muttering and murmuring. Can we at least bring some courtesy back to the Committee? That is addressed to everybody.

Photo of Emma Reynolds Emma Reynolds Shadow Minister (Foreign and Commonwealth Affairs)

I hate to say it, Mr Benton, but it all adds to the impression that perhaps somebody else is running this Bill, not Back Benchers, but there we go. However, it is not up to me to intrude on private arrangements in the Conservative party.

I was making a serious point about the City of London, which is one of the most important financial centres in the world.

If one talks to anyone in the City—I had a dinner at the City of London corporation only last week—they are clear that our membership of the European Union contributes to the success of the City of London. They do not necessarily agree with every dot and comma of European legislation, and in some cases they are keen to change that legislation, but, on a macro level, they are very clear that they want us to remain within the Union. I also heard some concern at that meeting about what the approach of the Conservative party would mean for foreign direct investment. In fact, an American representative of a bank said that FDI had already been discouraged by the Prime Minister’s speech in January and his promise of a referendum, so we are dealing with important matters for manufacturing and the City.

While my next point is again to do with timing, it is more to do with treaty change. The Conservative party will not achieve a unilateral repatriation of powers and it will not achieve unilateral reform for the UK. It is a shame that the Prime Minister is not present, because I agree with him when he says that the best opportunities for reform of the EU arise when the reform concerns all 28 EU member states. In Denmark, the Netherlands, Germany and other member states, there is significant appetite for reform of the EU. Those countries are pro-European, like myself, and also pro-reform. That is not contradiction; it is a valid position.

The reason behind the arbitrary nature of the 2017 date is the reliance on an unlikely and unrealistic timetable for achieving reform among 28 member states. If we are to seek further reform of the EU budget and the common agricultural policy, it will be necessary to negotiate with our European partners. I fear that while the Prime Minister has set out this arbitrary timetable in the Bill, there will be a significant chance that there is no change at all—whether through reform or in our relationship. The Prime Minister has offered his party a false prospectus of renegotiation in the next four years and then a referendum on that renegotiation.

Furthermore, it is pretty clear that for as long as the French President, President Hollande, and the Dutch Prime Minister, Mr Marc Rutte—I understand that the leader of the Liberal Democrats is close to him—are the leaders of their countries, there will be no treaty change. The French Socialists, who are now in power, were deeply scarred by the referendum that they lost on the constitution some years ago. Actually, the French on both the left and the right are minded to proceed with intergovernmentalism, not supranationalism, when it comes to EU integration. We are now seeing intergovernmentalism in how frequently the European Council meets, and how frequently the Heads of State and Government make their decisions. Intergovernmentalism does not really need too much treaty change. I hear that there are representatives of our Government who are optimistic that there will be treaty change before 2017, but I do not think that is realistic.

It is interesting that the Tory party grandee—if I may call him that—Lord Heseltine, who has great experience of many things, including these matters, put it appropriately back in January when he said:

“To commit to a referendum about a negotiation that hasn't begun, on a timescale you cannot predict, on an outcome that's unknown, where Britain's appeal as an inward investment market would be the centre of the debate, seems to me like an unnecessary gamble”.

It is worth focusing on that because it goes to the heart of the date for the referendum set out in clause 1(2). Lord Heseltine is clear that one simply cannot predict the time scale for negotiation and reform. I was working in Brussels at the time of the last treaty negotiations. They were long and arduous, and went on for years, both on the constitutional treaty and then on the Lisbon treaty.

Lord Heseltine is absolutely right: this is not a timetable that we can predict. There are 28 member states involved. This is about not just the UK, but the other 27 member states. The messages that we are getting from France, the Netherlands and parts of the German Government is that they do not want treaty change. They do not see a need for it at the moment. We should pay heed to the wise words of Lord Heseltine about the unknown outcome of such negotiations.

It seems very risky for the Prime Minister to predicate his pledge of a referendum on a hypothetical renegotiation. We do not know whether that has already begun. Perhaps the hon. Member for Cheltenham can shed some light on that, given that the Conservatives are in coalition with the Liberal Democrats, and if that repatriation was sought, it might be that the Liberal Democrats would not agree.

Photo of Martin Horwood Martin Horwood Liberal Democrat, Cheltenham 6:00, 17 July 2013

I am happy to try to enlighten the hon. Lady, although I do not want to anticipate too many of the things that I shall say in my speech. The renegotiation is rather a Conservative party concept, and I might speak in more detail later about what was actually proposed in the Prime Minister’s speech. Of course, the coalition Government have quite rightly launched the balance of competences review to examine the balance of powers between London and Brussels, and between the British and European levels of government, and they have also been quite free in discussing things such as the justice and home affairs opt-out/opt-in process. Those are healthy things to discuss, but one does not need to hold the time bomb of a referendum on British exit to achieve such reforms and examinations of where the balance of power really should lie.

Photo of Emma Reynolds Emma Reynolds Shadow Minister (Foreign and Commonwealth Affairs)

I agree with a number of the hon. Gentleman’s points. In my experience, and from what I have seen in European Council meetings, the European Parliament and other European institutions, one does not get one’s way in Brussels or Strasbourg by blackmailing the European Parliament—that simply does not work. The idea that one says to the rest of the EU—[ Interruption. ] I am glad that the hon. Member for South Staffordshire, who has not contributed much to the debate, thinks that this is funny. This is a serious point—[ Interruption. ] This chuntering from a sedentary position is getting a bit tiring, to be frank.

The point I am attempting to make is that the other member states of the European Union do not take kindly to being told that the UK will remain in the EU only if it repatriates a shopping list of demands from some Conservative Members. Not least among them is the hon. Member for South Northamptonshire (Andrea Leadsom), who has headed up what she herself calls a shopping list, but the problem with a shopping list is that the things put in the basket have to be paid for at the checkout.

European negotiations often involve some horse-trading. The idea that we will get unilateral repatriation before 2017 but nobody else will get anything, on a timetable that does not fit in with anybody else, is frankly unrealistic. I welcome the clarification that the hon. Member for Cheltenham set out. Predicated on this promise of a 2017 referendum, the Prime Minister set out in January and since then that there will be renegotiation before that time. Given the nature of the coalition and the situation that the hon. Member for Cheltenham has clarified, I do not think that renegotiation can happen now. It can happen only if the Conservatives get a majority, whenever that might be.

To please Conservative Members, let us imagine that the Conservatives win a majority in 2015. The Prime Minister would have only two years in which to renegotiate our membership of the EU.

Photo of Jim Dowd Jim Dowd Labour, Lewisham West and Penge

I am not sure that that covers the whole position. This shoddy piece of work that is masquerading as a parliamentary Bill says:

“The Secretary of State shall by order, and before 31 December 2016, appoint the day on which the referendum is to be held.”

I find it difficult to understand how a Secretary of State or Prime Minister—as a later amendment proposes—can appoint a date if the process is not completed. If there were a Conservative Government after May 2015, they would have 18 months to conclude the whole process.

Photo of Emma Reynolds Emma Reynolds Shadow Minister (Foreign and Commonwealth Affairs)

I agree with my hon. Friend. It is worse than I imagined. He is right that we should not calculate the time as being between May 2015 and the end of 2017. It remains uncertain whether the Secretary of State will be responsible if the Bill is passed, but that is a topic to debate perhaps not today, but in September.

Photo of Barry Sheerman Barry Sheerman Labour, Huddersfield

If we had seized the opportunity when the Prime Minister just popped into the public gallery, we could have asked him that question.

Photo of Emma Reynolds Emma Reynolds Shadow Minister (Foreign and Commonwealth Affairs)

As I understand it, from the expert guidance I have been given by the Committee Clerk, other right hon. and hon. Members, and even the Prime Minister, cannot contribute to our Committee’s work. I see that you are nodding in approval, Mr Benton.

Let me return to the point made by my hon. Friend the Member for Lewisham West and Penge. It is even more unrealistic for the Secretary of State to lay an order by 31 December 2016, because there will be only a year and half in which to carry out the process, although perhaps we should be generous and say that it is a bit longer than that at a year and seven months. I am sure,  Mr Benton, that you would want us to be accurate as we measure the time between the next general election and 31 December 2016—the date set out in subsection (3).

My central point is that it is highly unlikely that the process will be concluded in that time scale. To return to my anecdote about the shopping list, someone will have to pay for unilateral repatriation. I do not think that such repatriation is possible, but if there is some repatriation, someone will have to pay for it.

I do not mean to cast aspersions, but unless something changes in the next two years and the Conservatives rule alone as a minority Government before the next general election, as has been proposed, I do not see how the Government can lead a negotiation to repatriate powers in the way suggested by Conservative Members and, indeed, the Prime Minister himself. The timetable is simply not realistic. For that reason, the proposal of repatriation followed by a referendum adds further uncertainty, which is extremely damaging to the economy.

A key quote on the economy comes from a highly experienced Conservative Member and former Foreign Secretary, the right hon. and learned Member for Kensington (Sir Malcolm Rifkind), who said in the debate on whether we should hold a referendum on our membership:

“To have a debate that might lead to a referendum on whether Britain will remain in the European Union or leave it entirely is such a massive distraction from the real concerns that this country and the rest of Europe have to address.”—[Official Report, 24 October 2011; Vol. 534, c. 84.]

That sounds a little like what the hon. Member for Stockton South said the day before his name was drawn in the ballot.

Photo of Barry Sheerman Barry Sheerman Labour, Huddersfield

I do not want to dwell on the fact that many members of the Committee are relatively new Members of Parliament, but my hon. Friend quotes the voice of long experience—a former Conservative Foreign Secretary—and is it not true that those of us who know what uncertainty in the political process does are aware of just how damaging it is? We all have constituents whose lives will be badly altered by that uncertainty, and we know that it will go on and on for several years and that it will be damaging. Would any sensible regime in Europe grant concessions knowing that we might not be there after 2017?

Photo of Emma Reynolds Emma Reynolds Shadow Minister (Foreign and Commonwealth Affairs)

I could not agree more with my hon. Friend, and the Conservative party needs to reflect on what it is demanding in terms of repatriation before the referendum. I am sure that my hon. Friends would agree that to seek to repatriate powers in employment and social affairs when the legislation passed provides minimum protection—whether four weeks’ paid holiday, comparable rights for part-time workers, or a minimum parental leave requirement—would be exactly the wrong place to start.

However, the Conservative party and many hon. Members with whom I have debated reform, repatriation and the referendum seem to put this policy area right at the top of their list. This is unrealistic, because frankly why would the Governments of Germany, France, Spain, Italy, Hungary or Poland—or Luxemburg, which is a small country, but has a significant economy and lots of financial services—concede that our businesses, or  businesses located in the UK, should not abide by minimum employment and social standards, when businesses in their own member states would have to abide by those minimum standards? It is totally unrealistic and undesirable.

Photo of Martin Horwood Martin Horwood Liberal Democrat, Cheltenham 6:15, 17 July 2013

The hon. Lady makes a strong argument that is being illustrated as we speak in the relationship between the European Union and Switzerland. This Swiss are finding that their traditional practices in financial services are under enormous pressure from the European Union, and in effect they are suffering the kind of fax democracy that Norway suffers by being outside the European Union.

The Swiss have no say over the emerging rules for financial services in Europe, but they are going to have to abide by some of those transparency rules and the other changes that are being proposed. In effect, they have made themselves vulnerable by remaining outside the European Union. In fact, we think that that is true of Switzerland, but Switzerland is much less of a competitive threat to the eurozone economies than the City of London and the British financial services sector would be. What is already true for Switzerland would be much more true for the British financial services sector, and it would be a much greater risk in due course.

Photo of Emma Reynolds Emma Reynolds Shadow Minister (Foreign and Commonwealth Affairs)

I could not agree more with the hon. Gentleman. He is inviting me to move forward to sections in the latter part of my speech in which I shall discuss the meaning of being out of the EU. What do we mean by “out”? Is the fax democracy that he mentioned with regard to Norway the arrangement we will end up with? The Norwegian politicians whom I have met express frustration about having to abide by rules over which they have no say while still paying into the EU budget.

Photo of Martin Horwood Martin Horwood Liberal Democrat, Cheltenham

If the hon. Lady is looking for a precise model for what I think those Conservatives who are in favour of us leaving the European Union are suggesting, Norway is in fact part of the Schengen area, so it would not be an exact parallel. I think the only exact parallel would be Liechtenstein, so that shows the ambition of Conservative Eurosceptics for this country.

Photo of Emma Reynolds Emma Reynolds Shadow Minister (Foreign and Commonwealth Affairs)

I have bigger ambitions for our country, and I think that the hon. Gentleman is suggesting that he does, too. This question of what the alternative looks like is actually very problematic. Will we be in the position of Norway, which has to abide by the rules? It has no representation, whether at the Council of Ministers, the European Parliament or the European Commission. There are no Norwegian civil servants in the European Commission. Do we want to be in the situation in which Norway finds itself? It pays into the EU budget and, yes, it has access to the internal market of the EU, but it has to abide by legislation over which it has absolutely no say. It is not represented in any of the institutions, yet it is bound by the rules.

Alternatively, as the hon. Gentleman also suggested, are we going to go for the Swiss model? Switzerland has the arduous task of negotiating more than a hundred bilateral agreements with individual EU member states. Again, for us to be in that position would be detrimental to our economy, to our standing in the world and to our ability to deal with cross-border crime, terrorism, and  the increasing challenges of climate change and energy security. We need to have some very serious discussions about what the alternative is and what coming out would mean, but those points have not yet been anywhere near adequately explored.

I want to pick up on something else raised by the hon. Gentleman. He is right—he said this in the debate on the sittings motion—that it would be useful if we had before us the report on the balance of competencies. When we discuss the nature of our relationship with the European Union, whether or not we should leave it and what it means to remain in it, we get to my point about the nature of the question and what the background documents should be.

We thought that the first report on the balance of competencies would be published this month, but a newspaper report leads us to believe something else. Unfortunately, the Minister for Europe is not in the room to hear me ask this question, but perhaps his Parliamentary Private Secretary, if he is listening, will convey it to him. I urge the Government to publish that first report. First, in the interests of transparency, it would be good to know what the deliberations are. Secondly, it could inform the work of the Committee, because the balance of competencies is relevant to the Bill and especially to the nature of the question set out in clause 1(4).

As I understand it, the balance of competencies review will be a dispassionate, objective report into what powers the UK has already ceded to the EU. Evidence has apparently been taken from businesses throughout the country, civil society and others. It could be very useful for our discussions in Committee, and it would have been great to have had the report before now. Obviously, it will not be possible to have it for today’s debates, but it would be extremely useful if it were published before the Committee’s next sitting.

Photo of Barry Sheerman Barry Sheerman Labour, Huddersfield

On that point, I have always had this watchword that good policy is made on good evidence and on what works somewhere else. In fact, I spent 10 years of my life trying to persuade various Ministers that that would be a good way of developing policy. My hon. Friend is making a powerful case that if we had more time in this Committee, we could do a darn good job, as we could look at so much stuff in some depth. We could have the benefit of the research and the documents that we do not have now.

I cannot understand why all members of the Committee do not want that, as we all want to do a good job. I do not walk into a Committee, after many years of not doing this sort of Committee, without thinking about how we can do that. We are being brilliantly chaired. Why can we not, as a team, do a really good job of this? If we could get the balance of competencies and hear about the Electoral Commission’s view, we could all, as good parliamentarians, do a thorough job to the best of our abilities. We could then go home, however late it is, proud of what we have done, knowing that when the House resumes after the break, we can do an even better job.

Photo of Emma Reynolds Emma Reynolds Shadow Minister (Foreign and Commonwealth Affairs)

My hon. Friend makes a valid point. The balance of competencies review would help Members on both sides of the Committee and on both sides of the argument.

Photo of Martin Horwood Martin Horwood Liberal Democrat, Cheltenham

The hon. Lady is being patient with the number of interventions she is receiving. We should make it clear that the balance of competencies review is divided into three semesters, which is interesting phraseology. The report from the first semester should have been published by now. It is rather curious that, as with one or two other reports that seem to have landed on Government desks, the Government are waiting to the very last minute before we go into the summer recess. Perhaps it is because they have the wrong message in them, which is that there are many areas in which the balance of competencies is right and is helpful to this country’s interests and to the welfare and well-being of British citizens.

If that first semester report is imminent then the second semester report is some way off and the third is further still. It would be perfectly sensible for the Bill to wait until the entire process was finished in order to properly inform the debate. After all, as we have said repeatedly, even in the mind of its promoter, the Bill will not bring about a referendum until 2017 so it is not as if we are in a tearing hurry to get this done. The balance of competencies points the hon. Lady makes are very valid.

Photo of Barry Sheerman Barry Sheerman Labour, Huddersfield

On a point of order, Mr Benton. I have just had a tweet that says, “I hope you won’t try to sabotage this Bill and stop your constituents from having their say,” followed by one that says, “We are making a list and checking it twice. We’re gonna find out who’s naughty and nice.” These are obviously from people who are trying to influence a member of this Committee in a certain direction. Could you give us some guidance, Mr Benton?

Photo of Joe Benton Joe Benton Labour, Bootle

I cannot give guidance on who your correspondents are. Somebody has sent you a message. I cannot do anything about that. I make a serious suggestion: interventions have been spreading out into speeches; I remind the Committee that interventions are supposed to be brief.

Photo of Martin Horwood Martin Horwood Liberal Democrat, Cheltenham

Further to that point of order, Mr Benton. On a practical point, it would be quite nice if the Doorkeepers could attend to the distribution of water. It all seems to have ended up at one end of the room. Just in case we sit late and there are some long speeches it would be nice to have some lubrication.

Photo of Martin Horwood Martin Horwood Liberal Democrat, Cheltenham

I am sure that we are not allowed anything stronger than water. I do not think gin and tonic would be entirely in keeping with parliamentary procedures.

Photo of Barry Sheerman Barry Sheerman Labour, Huddersfield

Further to that point of order, Mr Benton. Could the Clerk say something about this? Is it a matter of privilege that people start tweeting us in one direction when we are in Committee? This is a well-known pressure group.

Photo of Joe Benton Joe Benton Labour, Bootle

I am not very well versed on modern communications, as many people will appreciate, but even I can understand that if somebody tweets you it is not a matter for this Committee.

Photo of Emma Reynolds Emma Reynolds Shadow Minister (Foreign and Commonwealth Affairs)

Your long years in this House, Mr Benton, are an asset to this Committee, as is your experience of social media. I agree with you. Many times when I look at my Twitter account I think, why not just ignore it? The only thing I would say to my hon. Friend is that I have not had a chance to look at my phone for quite some time and I do not intend to do so for quite some time either. It is up to members of the Committee, without outside influence, to do as they see fit and to scrutinise the Bill.

I come back to the intervention from the hon. Member for Cheltenham. I know that the balance of competencies review was a cornerstone of the coalition agreement. I understand why he is urging that the report on the first semester be published. As he says, it is an interesting phrase. It is quite a European way of describing it. The economic semester is often talked about. I call on the Government to consider seriously publishing that initial balance of competencies report, because it would be of interest to Committee members, and it is extremely relevant to the Bill, particularly the clauses that cover the question and timing. I hope that the PPS, who is in his place, will convey my wishes and those of the hon. Member for Cheltenham to the Government on that.

My third argument is about the European Union being in a state of flux and the implications of that for our deliberations on whether there should be legislation to commit the next Government to a referendum. The eurozone crisis has raised fundamental questions about how eurozone economies should work better together.

Some member states are calling for extensive economic integration, and there is already progress on banking union, which is being discussed among eurozone member states. There has already been a fiscal compact treaty, which applied only to eurozone member states, but was signed by every EU member state, except the UK and the Czech Republic. There is therefore a dynamic in the EU that was not present before the global financial crash and the problems in the eurozone between the eurozone member states, of which there are 17 out of the 28, and the others.

Photo of Barry Sheerman Barry Sheerman Labour, Huddersfield 6:30, 17 July 2013

Before someone else divulges this in Committee, I confess that, for seven years, I chaired the committee on preparation for the euro. We took evidence, and I absolutely agree with my hon. Friend’s analysis. We predicted the problems in the eurozone.

I point out to the younger members of the Committee that the Secretary of State for Business, Innovation and Skills served on the committee for the seven years. Its remit was to ensure that we were prepared to enter the eurozone if there were a decision in a referendum, or by any other means, to join. Many people have misconceptions. If they want to throw that at me, let me assure them that it was not a committee in favour of the euro; we were checking preparedness in the case of making the decision to join.

Photo of Emma Reynolds Emma Reynolds Shadow Minister (Foreign and Commonwealth Affairs)

I am sure that my hon. Friend will now get feedback on Twitter. He might want to tell us about it, but perhaps he should not.

The point that I was starting to develop relates to my hon. Friend’s intervention and the comment of the hon. Member for South Staffordshire about whether we should have joined the euro. It is safe to say that there is cross-party consensus in Committee and more widely, including the Prime Minister, the Leader of the Opposition and the Deputy Prime Minister on the view that the UK should not join. The dynamic and the relationship between the eurozone 17 and the non-eurozone 11—we were 10, but Croatia has just joined the EU—is important.

The test for our consideration of the Bill and more widely should be whether something is in the national interest. The far greater question—some may say this is a risk to our national interest—is whether there will be a dynamic of separation between the eurozone 17 and the non-eurozone 11. That is uncertain, and we do not know how that dynamic will develop.

Therefore, while having a referendum in four years’ time is arbitrary, it will also not be clear by 31 December 2017, or even by 31 December 2016, as my hon. Friend the Member for Lewisham West and Penge said, what the relationship will be between the UK, as the biggest non-eurozone country, although there are 10 others, and the eurozone 17, which obviously include the biggest economies, such as Germany and France, as well as some other very significant economies, such as Italy. It is not clear, and I do not think it will be clear in four years’ time, what that relationship will be.

The key question for the Government and for whoever wins the next election—I hope the Labour party gets back into power in 2015—is how the UK approaches the economic integration of the eurozone 17. The Chancellor is on record as saying that they should integrate their economies more closely and that that is—I forget his exact phrase—the inexorable logic of the euro. Monetary union implies some form of economic union, but it will not become clear between now and 2017 to what extent eurozone member states will be able to achieve economic union or what that economic union will look like.

The most pressing priority for eurozone heads of state and all other European heads of state is to resolve the current crisis. That has been the subject of European Councils for the last three years, and it is absolutely right that that should be the priority. However, another priority is now also being considered, and it affects our debate on a referendum on our EU membership. What do eurozone members states, acting in co-operation with the wider EU, need to do about the dire economic situation in Greece, Spain and, to a certain extent, Ireland—it is having a tough time too, although it seems to be coming out of the worst of it—as well as in Italy, Cyprus and, perhaps Slovenia, to avert a future crisis? What needs to be put in place in terms of economic integration—I think this is what the Chancellor has in mind when he talks about the logic of economic union—to avert a future eurozone crisis, which would be in our national interest and that of other European member states?

We have not yet seen which policies will be used to allow that economic integration to take place. I am not convinced that we will see that before the end of 2017. There will be ongoing debate and consultation in the eurozone, and it is vital that this Government and the future Government in 2015 play a role in that. However, it is not clear to me or others when this state of flux will  end. We simply do not know which economic policies and which degree of economic integration the eurozone will choose.

Photo of Barry Sheerman Barry Sheerman Labour, Huddersfield

My hon. Friend puts her finger on the centre of the uncertainty. We are closer to the next election than the 2010 election, and the normal democratic process is that we will start to shape up our manifestos and make choices. Europe and what we will do about it is absolutely central to what we will put in front of the British public in our manifestos. The Government are delivering a level of uncertainty that is almost inexplicable. Even the Opposition—I am criticising my side—have not made many decisions and do not have finely crafted answers on many points. Does my hon. Friend agree?

Photo of Emma Reynolds Emma Reynolds Shadow Minister (Foreign and Commonwealth Affairs)

I agree, and it is uncertain and unclear what our relationship with the eurozone, and therefore the rest of the European Union, will be. Eurozone member states may choose to integrate their economies. The Government, particularly the Chancellor, but other Ministers including the Prime Minister, have said that that integration is necessary to avert further crises in future, and to get over the current one. A more important question than whether we should have a referendum but which is related to that is how the UK will position itself in that dynamic.

I would like us to protect against any spill-over effects and against caucusing. There have been all sort of suggestions in the last couple of years that further eurozone integration might lead to extra meetings of eurozone Ministers, and there is a new proposal from the French and German Governments for another eurozone president. I do not know whether the risk is exaggerated, but there is a risk that if member states meet more frequently—they have started to do so—and at an even higher level, they will start to take decisions on the internal market and perhaps other areas that affect the UK and the 10 other non-eurozone countries so that they bypass the EU’s normal decision making. In the many debates I have on European matters, that is the key issue. If the referendum pledge is set in stone in the law it will weaken the UK’s position to ensure that caucusing does not happen and to protect against spill-over effects of eurozone integration.

The Government are highly critical of member states that want to forge ahead with a financial transaction tax. They have taken the European Commission, which came up with the proposal under the relatively new enhanced co-operation procedure, to the European Court of Justice. That is an example of the uncertain dynamic and of what the Government claim will be a spill-over effect. They worry that if member states that have signed up to the financial transaction tax go ahead with it, it will affect banks, other financial services and companies in the City of London. These matters are complicated.

Photo of Barry Sheerman Barry Sheerman Labour, Huddersfield

Is that one of the considerations that the Committee should bear in mind? Certainly that will be reflected in the value of sterling against the euro and other currencies. In terms of London’s role as a major financial centre, would it not be the case that that uncertainty might fundamentally undermine the City of London?

Photo of Emma Reynolds Emma Reynolds Shadow Minister (Foreign and Commonwealth Affairs) 6:45, 17 July 2013

My hon. Friend makes a valid point. I said earlier that the uncertainty created by the Prime Minister’s pledge in January in his so-called Bloomberg speech and the draft Bill, should I say—the aspiring legislation—before us today could lead to: a weakening of our financial services sector; investors being put off; and significant investors choosing other EU member states who are certain to stay in the European Union. To be frank, although there are big problems in the eurozone at the moment, I do not know of any other EU member state where a debate of this kind is going on.

Photo of Barry Sheerman Barry Sheerman Labour, Huddersfield

I am sorry to intervene again. I agree with most of what my hon. Friend has said today, but is she not on really dangerous territory? We would not want something said carelessly in this Committee to start a run on the pound. Is she not being a little extravagant in her language?

Photo of Emma Reynolds Emma Reynolds Shadow Minister (Foreign and Commonwealth Affairs)

I was not suggesting that there would be a run on the pound; I was merely setting out the argument that there are concerns in the City that if we were to leave the EU, or if that prospect looked likely, there could be some real problems in terms of financial services. I will not go into technical details of currencies as I am sure that there are people much better qualified than me to talk about that, and I do not want to get into a discussion on sterling versus the euro. I think that my hon. Friend misunderstood me: I was not trying to set out the point he suggested.

Let me come back to my central point in this third argument that I am prosecuting: there is the potential for a eurozone versus non-eurozone dynamic. I hope that that will not develop, but that is a risk. I have talked about how that might occur in terms of eurozone member states and in the European Council. Members of the European Parliament from France—I am a big Francophile, but sometimes they cause a bit of trouble—and other eurozone member states put in doubt the position of the UK chair of the Economic and Monetary Affairs Committee.

Sharon Bowles is a Liberal Democrat and does the job well; she is technically adept and knows her subject. However, I remember that halfway through a European Parliament session, there were suggestions that because she was a Brit, she should not be chairing that committee. That is the sort of suggestion that I am sure will be made after the next European Parliament elections.

Photo of Martin Horwood Martin Horwood Liberal Democrat, Cheltenham

The hon. Lady is exactly right in her recollection of those events. I am happy to pay tribute to Sharon Bowles: she is an outstanding Member of the European Parliament and, as has been mentioned in many league tables, one of the most important economic regulators in Europe. That a Brit is performing that role is evidence of how, if we want to, we can exercise enormous positive influence inside Europe and have a really powerful say at the negotiating table on issues such as economic regulation. Her position was genuinely put at risk by questions raised on talk of referendums and exit and that is a good illustration of exactly the kind of risky uncertainty that those debates can engender.

Photo of Emma Reynolds Emma Reynolds Shadow Minister (Foreign and Commonwealth Affairs)

I could not agree more. I say, on a cross-party basis, that Sharon Bowles remains the chair of that committee until the next European elections. To be even more cross-party, I know that Malcolm Harbour, who is a West Midlands MEP, a good pro-European and a long-standing Member of the European Parliament, also chairs the Internal Market and Consumer Protection Committee. I fear that after the next European elections, as the hon. Member for Cheltenham sets out—because of the uncertainty about our membership, because of what we are discussing today and because senior members of the Government from the Conservative party have suggested that they would want to leave the EU if the referendum were held sooner rather than later—positions in the European Parliament that have been open to British MEPs of all parties will no longer be open.

Arlene McCarthy is vice-chair of the Economic and Monetary Affairs Committee, so I have now mentioned three different MEPs from three different parties. Someone such as Arlene McCarthy should be in with a good chance of chairing that committee because she has sat on it for some time. I worry, however, that the ongoing debate about our membership and the idea that our leaving might be inevitable weakens our hand on the positions in the European Parliament that we are likely to secure after the next European elections. That is a great concern for the standing of the UK in EU institutions.

It is also worth noting that on recent visits to Brussels, in the Commission and elsewhere, it has been suggested that, because our Government have been very unco-operative on many matters, we will not be granted any portfolio in the European Commission for which we might bid. I would imagine that the senior echelons of the Conservative party are already discussing which hon. Member, or otherwise, they might send to Brussels, but because of the referendum pledge and the Bill we are considering today, when the Prime Minister goes to the key summit with other European Heads of State this time next year, or in the autumn after the European parliamentary elections next year, he may be severely disappointed.

I would think that the Government prefer a big portfolio such as the Competition Commissioner. In the past we have had trade, which is a big portfolio, and we have foreign affairs at the moment, or the Government might prefer the internal market. Unfortunately, because of the debate in our Parliament and the speculation outside our Parliament that we might leave, I fear that our portfolio might not be as significant or as important as the one we would otherwise have held.

Photo of Martin Horwood Martin Horwood Liberal Democrat, Cheltenham

The hon. Lady is making a very strong case on the risks to British influence in Europe. Of course it is not just about European parliamentary committee chairmanships or Commissioner posts; there are also heads of agencies. The best and most obvious example is Rob Wainwright, the head of Europol. I am very pleased to say that his tenure has just been extended, but it is easy to see that, if we are ambivalent about our future membership of Europol and the use of the European arrest warrant, and so on, it might be felt inappropriate for a Brit to hold such a position on a long tenure. That would be a very retrograde step. Because of the expertise of British police forces in, for instance, fighting terrorism and cybercrime, there would be a real cost to the safety and security of people not just in this country but across Europe.

Photo of Emma Reynolds Emma Reynolds Shadow Minister (Foreign and Commonwealth Affairs)

That is a very helpful intervention. Rob Wainwright does a fantastic job of heading Europol on behalf of not only the UK but all members of the European Union. He is at the forefront of fighting cross-border crime, which is one of the benefits of our membership of the EU—I have talked about the economic benefits, but there are many benefits besides.

The hon. Gentleman puts his finger on an interesting point of debate on the Bill’s implications. The Government have recently embarked on negotiations about which policing and judicial co-operation matters they wish to opt in to. We have said that there are great risks in using the block opt-out and then trying to opt back in. According to the treaties, the opt-in to those matters and areas where the Government will seek to opt in, whether or not that strategy is successful, will depend on the good will of other member states. As I have said before, to get the best deal for the UK we need to be in a stronger position than we are at the moment. There is no good will either in the Commission or, unfortunately, in other member states’ Governments towards the UK given what has happened over the past three years.

Photo of Jim Dowd Jim Dowd Labour, Lewisham West and Penge

The good will of our current European partners is necessary to conclude a successful renegotiation, but even if that was rejected by the British people at the referendum, which I hope will take place, we still need that good will to negotiate an exit from the European Union. Antagonising other member states has no purpose whatever.

Photo of Emma Reynolds Emma Reynolds Shadow Minister (Foreign and Commonwealth Affairs)

I could not agree more. The level of good will that my hon. Friend refers to will have serious implications for what “out” means. If there is a referendum and if the people of this country vote to leave Europe, what will that mean for our relationship? No other member state has ever tried to extricate itself from the European Union. I am not saying that it is impossible, but what conditions will be put on that exit? Will we be able to secure access to the biggest internal market in the world? The Norwegians have secured that access, but at both a financial cost in terms of their contribution and a cost in terms of influence, because they do not, as I said previously, have representation in European institutions, yet they must abide by many of those institutions’ decisions without their being consulted or having a vote.

I thank my hon. Friend for that helpful intervention, which is particularly relevant to clause 1, because it provides for the question that will be put to the British people should the Bill become law. I read an interesting piece in The Daily Telegraph yesterday, written by my hon. Friend the Member for Birmingham, Edgbaston (Ms Stuart), for whom I have great admiration, although we disagree on these matters, about what constitutes “exit”. She and others launched—I think last night at the Institute for Economic Affairs—a prize for a piece of work to describe what the UK’s exit from the European Union would look like. Unfortunately, I do not think that that award will be presented—I looked carefully at the timetable on the website—before the end of the Committee’s deliberations, which is a shame, because it is that sort of information and, if possible, dispassionate assessment that we need to consider.

I want to return to my argument about eurozone versus non-eurozone. Notwithstanding what I have already said about spill-over effects, the financial transaction  tax and the lack of good will and what that means for our representation in all European Union institutions—[Interruption.]

Photo of Joe Benton Joe Benton Labour, Bootle

Order. There is a Division. I suspend the Committee until 8.30 pm, to give people an opportunity to have dinner.

Sitting suspended.

On resuming—

Photo of Emma Reynolds Emma Reynolds Shadow Minister (Foreign and Commonwealth Affairs)

It is a great pleasure to continue to serve under your very able and expert chairmanship, Mr Benton. Before the votes and the break, I was talking about the dynamic between the eurozone 17 and the non-eurozone 10, of which the UK is the most significant economy—the biggest economy.

I was talking about the prospect—the risk—of that happening. It will not necessarily happen, but we might find ourselves in a position whereby the eurozone member states, having committed to integrate their economies more closely in one way or another and having committed to further high-level meetings—even higher-level meetings than they currently have in place—start to, in the lingo, “caucus”. That means that they would meet as they do already, but would start to consider legislation—for example, with regard to the single market—that affected the EU of 28, and would act in a way that affected us but without consulting us. That fear is present in many European debates in which the hon. Member for Cheltenham, my hon. Friend the Member for Glasgow North East and I have participated.

Photo of William Bain William Bain Shadow Minister (Scotland)

I am sure that my hon. Friend and I have many further elements of this discussion ahead of us this evening and I know that both of us look forward to that very much. Has she seen the recent reports coming out of Germany that indicate that Chancellor Merkel and Finance Minister Schäuble see potential for further co-operation among the eurozone 17, particularly on areas such as banking, which may not require a further treaty to be drawn up at this stage? Would that not weaken the position that would be created by this Bill, which is predicated on the apparent need at eurozone level for such a treaty?

Photo of Emma Reynolds Emma Reynolds Shadow Minister (Foreign and Commonwealth Affairs)

I agree. I think that many discussions are going on, not least with the German Ministers—the Chancellor, the Finance Minister and other Ministers in the current German Government—about banking union, further steps towards integration of eurozone economies and how they keep their constitutional court on side, which is a significant consideration. There seems to be in the EU at the moment—this makes the timetable of the Bill even more unlikely—a waiting period. It is clear that Germany is the strongest and biggest economy in the eurozone and has the wherewithal to put in place perhaps a transfer union, although it is unwilling to do so. It is clear that Chancellor Merkel, when there are meetings—now at least six a year—of European Union Heads of State and Government, is considered to be the leading member of that group.

To return to the Bill, we are talking about a deadline of 2017, yet there has been very little progress at European Union level, precisely because the German Government, as we know, may not be in place in their current form come 22 September and the federal elections. That is another staging post on the relatively short journey between now and the end of 2017, so the developments that I have been talking about—the banking union and the integration of eurozone economies—have been even further slowed down. We know that, at EU level, nothing happens quickly, but developments within the EU have been even further slowed down because the election campaign in Germany has kicked off and because there is a relatively long pre-election period. I think that it is true to say that, in the higher echelons of the German Government, there is a debate about what changes need to take place and the constitutional implications of those changes, as my hon. Friend the Member for Glasgow North East suggested.

There is a risk that Germany, France and other eurozone member states not only start to forge ahead with measures that affect the eurozone, but—I come back to my original point—they may well start to discuss measures that affect the UK and the other 10 member states that are outside the eurozone. Therefore, if we were to be guided, and we should be guided, by priorities in the national interest, we would not be debating a Bill about a referendum in four years’ time. We would not have the timetable in the first place, but we might be debating—we should be debating—what is really in the national interest, which is protecting against our being left on the sidelines and against decisions that have implications for the British economy, British politics and British standing in the world that may be made in a forum of eurozone Finance Ministers, or eurozone Heads of State and Government, over which we will have no control.

These dynamics are developing at EU level. It is highly uncertain how quickly any measures about eurozone economic integration will be taken forward. Again, that makes the timetable of this Bill highly unrealistic, and not only because there are elections. There are federal elections in Germany, and the Italian Prime Minister was in the UK today and there might be Italian elections this time next year—who knows?—because there is quite a fragile coalition across the parties in Italy. There are other member states in the eurozone with significant economies that have very fragile Governments and where there might be elections. The dynamic between the eurozone 17 and the non-eurozone 11 could mean that it takes a long time before the implications are clear.

I want our Government and whichever Government are elected in 2015—I hope that it is a Labour Government—to ensure that there is not that divide between the non-eurozone and the eurozone, because, again, it is not in our national interest. We have a lot in common with some member states within the eurozone, such as Germany and the Netherlands, but we also have a lot in common with Denmark, Sweden and other countries that are outside the eurozone.

Unfortunately, the doubts about our membership put at risk as an aspiration, objective or ambition something that I hope will happen, namely that a British Government  could lead in many different policy areas, even if we are outside the eurozone. However, given that our membership has been put in doubt, that might not be the case.

We already lead in defence, in foreign policy—I think we could lead even further in that area—and we could, if we so desired, lead in justice and home affairs. When Tony Blair was Prime Minister, we led in justice and home affairs. There are many policy areas where we could lead, notwithstanding the fact that we will remain outside the eurozone. Before the suspension, I think that I said there was cross-party consensus that the UK should not join the euro. However, even though it will remain the case that we are outside the eurozone, there are many policy areas where the UK could lead.

Photo of William Bain William Bain Shadow Minister (Scotland)

My hon. Friend is entirely right about the economy. Does she share my worry about the recent remarks of the President of the European Council, Herman Van Rompuy, who said that the UK could provide real impetus and leadership in the reform of the European economy, leading the process of completing the single European market, engaging in an agenda for growth, and reducing the current number of 26 million unemployed? How can that be achieved if the Government are so badly distracted—as perhaps some members of the Committee are now—with the agenda of seeing Britain on the way out, when we should be securing victories from the inside?

Photo of Emma Reynolds Emma Reynolds Shadow Minister (Foreign and Commonwealth Affairs)

There are Governments in other member states who value the fact that the British Government, and British politicians from across the political divide, are in favour of free trade and against protectionism. Other member states look to the UK to make that argument within the EU to ensure that we are on the right path of free trade agreements and that there are no protectionist measures that stop the EU being competitive in the world. I take on board what my hon. Friend said. There needs to be careful consideration of how we proceed with the substance of the Bill, given that we do not know how developments at a European level will play out.

Given the state of flux that the European Union is in, it is premature to commit ourselves now to a referendum in four years’ time. It will create great uncertainty in the economy and in foreign direct investment. It is also precisely the wrong time, in terms of the developments in the EU and the uncertainty about how much integration will occur within the eurozone, to be holding such a debate under the cloud of uncertainty that has been cast over our membership by Conservative elements. The UK has a lot to offer, and member states see that potential. However, I fear that our debate today and our discussions about process are distractions from the debates about substance and real policies that could lead to improvements in the lives of my constituents and those of all hon. Members.

It is pretty clear that no challenges arise due to globalisation that the UK would be better tackling alone. In a world where crime knows no borders and where climate change clearly knows no borders; where we need good financial regulation and where we have China, with the largest population in the world, and India, which is set to overtake China in population size, perhaps in the next 20 years depending on the forecasts, it is precisely the wrong time to put our EU membership in doubt.

At this time, it is even more important that we should not be isolated, that we should not be marginalised and that we should not kid ourselves that we could go it alone. There are grave risks in trying to do so and, as we discussed, it is also not clear what coming out of the EU means. What is the path to exit? That is untried. No member state has done it. What implications will it have for our access to the single market? Will we be able to negotiate that access, and at what price? What implications would it have for pursuing well-known fugitives, as happened only weeks ago when we saw a British man in Spain being pursued by the Spanish police and almost immediately being extradited back to the UK. We also saw that with a school teacher who abducted a 15-year-old, fled to Bordeaux, and was extradited back to the UK.

If we were to come out of the EU, would we become a safe haven for other member states’ criminals? A recent House of Lords Committee report has suggested that, if it is not possible to negotiate our way back into the European arrest warrant, or if there is a gap between the opt-out and the opt-in, the UK could be a safe haven. It is not only our noble Lords, but the Association of Chief Police Officers and the intelligence services who have warned that we could become a safe haven for foreign criminals. I do not want that to happen; it is not in the national interest. We need time to discuss all those matters, because they are substantial and there would be grave consequences if we got it wrong.

Photo of William Bain William Bain Shadow Minister (Scotland) 8:45, 17 July 2013

Is not one of the advantages of the European Union—and one of the reasons why other countries, such as Serbia, Turkey, Montenegro and Albania are queuing up to join—that it is a rules-based form of co-operation, and that those rules are enforced by a judicial body, which, of course, is the European Court of Justice? Would not the effect of clause 1(4) be to achieve the ambition that some Committee members and some members of the wider Conservative parliamentary party may have, which is to end the ECJ’s jurisdiction in relation to the United Kingdom? Would that not make the single market unenforceable, and would it not create institutional chaos? Is that not just another example of the failure of the hon. Member for Stockton South to provide the Committee today with evidence about what powers he or the Government want to bring back from EU level?

Photo of Emma Reynolds Emma Reynolds Shadow Minister (Foreign and Commonwealth Affairs)

There are grave dangers in suggesting that the ECJ would not be the arbiter of EU rules. I am not saying that I have always agreed with every single ruling of the ECJ, but its purpose is to enforce EU legislation. We need a court of that kind to enforce initiatives taken at a European level, and also to ensure that other member states enforce legislation that has been agreed. If not, it would be a free-for-all.

Photo of Martin Horwood Martin Horwood Liberal Democrat, Cheltenham

If I may, I will quote a great authority in support of the hon. Lady’s argument that any rules-based system needs some means of arbitration. In order to participate in a rules-based system such as the single market, there is a need to submit to that arbitration. The person I am thinking about said:

“I accept, of course, that for the single market to function we need a common set of rules and a way of enforcing them.”

That was the Prime Minister in his Bloomberg speech. It is quite obvious that he essentially accepts that jurisdiction.

Photo of Emma Reynolds Emma Reynolds Shadow Minister (Foreign and Commonwealth Affairs)

It might surprise Conservative Members when I say that we welcomed the first 80% of the Prime Minister’s speech in January. Of course we want a flexible, competitive, reformed European Union, and as the hon. Gentleman says, some form of arbitration to enforce the rules will be and has been necessary for the EU to be a success. In the UK there is a lot of focus on ECJ rulings that do not suit us. As I say, some of them have been problematic, but what would happen to the EU and to the single market if we did not have the ECJ? What would happen, as my hon. Friend the Member for Glasgow North East said, if we come out of the EU, yet have to abide by the rules? How does that affect our ability to use the ECJ?

I mentioned that the current Government have taken the European Commission proposal with regard to enhanced co-operation on a financial transaction tax to the ECJ.

If we were not a member of the European Union, the Government would not have been able to do that. The implications of leaving have not been sufficiently considered and we have only just touched the surface of it today: it is the tip of the iceberg, in terms of the risks of leaving.

It is worth also considering some of the interesting work done by Open Europe about the double majority ruling that has been put in place, which is a good thing. Open Europe was concerned about some spill-over effects that I have discussed, especially with regard to the establishment of a banking union. It is good that we have the new procedure, which would mean that if a majority in the eurozone wanted to forge ahead with banking union, there would also have to be a consultation and a majority of non-eurozone member states would have to agree to such measures. I congratulate the Government on negotiating that double majority ruling. That measure is safe until—and when—other member states join the euro.

We are in a fairly unique position, in that we have an opt-out on the euro, which Sir John Major negotiated. I am sure that if Government Members wished to contribute to the debate—it does not look like they are going to this evening—after a glass of wine, they might have reminded me of that, had I not mentioned it. Yes, a Conservative Government negotiated an opt-out on the euro. However, let us not neglect to remember that other member states have an obligation to join the euro. There was a referendum on joining the euro in Sweden some years ago, in which they voted no, but Sweden is still obliged to consider joining it. There is an obligation on the Czech Republic to join the euro at some stage. There is an obligation on the new member states—Bulgaria and Romania—to join the euro, and on Hungary, Latvia, and Lithuania.

The European banking union proposals are interesting because they are not just about the dynamics of the non-euro zone versus the euro zone. Some of the non-euro zone countries that are preparing to join the euro, not least, Lithuania and Latvia—and Poland is keen to join it at some stage—want to join the banking union, or at least have reserved judgment about whether they will proceed to join it.

How secure is the double majority measure that the Government succeeded in negotiating? At the moment, it is 17 versus 11, but that will not stay the same in the years ahead. Therefore, the spill-over effects—the possibility of caucusing—are real. We would be better as a country if the Government were minded to try to ensure that the UK leads in other areas where it has strength, such as foreign policy and defence, where the UK wants to do good in the world, so that we cannot be accused by our European partners of just being unco-operative. That would be a way of protecting against the caucusing that we have been discussing this evening.

These matters deserve substantial consideration. If we were applying dispassionately the test of the national interest instead of talking about the process, which is all the Bill talks about, we should also be talking about the substance. Not only is the endless obsession with process a distraction, but the implication that the Government want to leave the European Union weakens our ability to stand tall and exercise influence in key areas of national interest. It is unclear whether treaty change will happen before 2017, and it is terrifically unclear what the dynamic will be. Will it be 27:1? Will it be 17:10? Will it be 20:8? After all, Croatia has just joined. The numbers and dynamics are fluid, and the Government must be leading on the front foot in areas in which the UK can make a significant contribution.

As I said at the outset, under amendment 30 the Bill would enable rather than compel the next Government to hold a referendum. My other amendments deal with the transfer of power. I do not believe that any significant changes have been made in our relationship with the European Union since the vote in October 2011, in which the Minister and some Conservative Committee members—I do not have the list in front of me—voted against an in/out referendum. As I said earlier, what has changed? Nothing significant has changed in our relationship with the European Union. Why should we have a referendum now, when there has been no transfer of power and no change in our relationship, but not have a referendum on the Single European Act?

The Single European Act, to which the late Baroness Thatcher signed up, created a significant transfer of power—we think that that should be the test for a referendum—by getting rid of the veto in policy areas and introducing qualified majority voting. As hon. Members know, qualified majority voting is a complicated method that gives different member states different weighting depending on the size of their populations. The move from unanimity to qualified majority voting entailed a massive transfer of power from the Houses of Parliament to the European institutions, but I do not recall there ever having been a debate about a referendum on the Single European Act. Perhaps I am wrong, and Conservative Members remember better than I do.

The introduction of qualified majority voting in the ’80s constituted a major step change in European integration. If the referendum lock that the hon. Member for Cheltenham and I debated on the Floor of the House two years ago had existed at the time, there would have been a referendum on that transfer of power. My amendments would ensure that an equivalent  change to European voting rules would trigger a referendum. If we look at this objectively, the Single European Act represents a historic moment in the development of the European Union, but there is no equivalent now. I am not saying that there will be no equivalent in the future: there could be a treaty change. It would be beyond the deadline set by the hon. Member for Stockton South in this Private Member’s Bill, but it could happen in 2020, or perhaps 2025. Perhaps we will have to have another Convention on the Future of Europe. My hon. Friend the Member for Birmingham Edgbaston would probably warn against that, because she saw at close hand the difficulties in the so-called IGCs, or intergovernmental conferences.

If any treaty were to come about that was the equivalent of the changes we saw in the Maastricht Treaty, to which Sir John Major signed up when he was Prime Minister, that would be triggered by the transfer of power provisions that my amendments proposed. If we look at what happened historically, the Single European Act and the Maastricht treaty represented big transfers of power under a Conservative Government.

Photo of William Bain William Bain Shadow Minister (Scotland) 9:00, 17 July 2013

Can my hon. Friend confirm that these monumental changes to qualified majority voting, introduced by the Single European Act and amended by the treaty on European Union, the Amsterdam treaty, the Nice treaty and the Lisbon treaty, confer on the United Kingdom, when sitting at the Council discussion table, some 29 votes when it comes to considering reforms such as completion of the single market in energy, for example? Does my hon. Friend share my concern that, if clause 1(4) were enacted in its current form, we would risk having no votes in determining the future of the single market, even should the hon. Member for Stockton South and the Government want to keep us within the European economic area?

Photo of Emma Reynolds Emma Reynolds Shadow Minister (Foreign and Commonwealth Affairs)

Indeed—if we leave the European Union and are merely a member of a European economic area, we would lose the 29 votes that we have currently in the Council of Ministers. Germany has 29 votes and so do France and Spain, given that we are the four large Member States in terms of population. Those votes mean significant power in the Council of Ministers. It is therefore open to the United Kingdom, given that weight, to form alliances where necessary with other member states and, in some cases, to block legislation or in others to push it through. It is worth considering that qualified majority voting is a method by which the Council of Ministers comes to conclusions. It is set out very clearly in the Nice treaty, to take into account the enlargement of the European Union in 2004 and 2007. We had a recent enlargement on the first of this month.

The smaller member states have less power in terms of qualified majority voting; for example, Malta has only three votes, and Luxembourg, Cyprus, Estonia, Slovenia and Latvia have four votes each. I would rather we kept our 29 votes than not have any votes at all, as the Norwegians find, and as my hon. Friend implied in his intervention. As I say, let us look at this from a historical perspective. If there was a change that was equivalent to the introduction of QMV and to getting rid of the veto in one policy area—given that there are still vetoes in foreign policy and other sensitive areas—and if the European Union decided to get rid of  those and move to QMV, of course there should be a referendum, because that would be a transfer of power. The hon. Member for Cheltenham knows better than I do the kinds of debates that we had in the House about what changes would constitute a transfer of power. However, it is clear that the Conservative Governments of the 1980s and 1990s agreed to substantial, fundamental transfers of power without calling for a referendum.

That makes today’s debate seem a little odd, to say the least. It is also a little inconsistent of some of the right hon. and hon. Members who were in the House of Commons in the 1990s. One such right hon. Member is the Foreign Secretary. On 21 April 1993 there was a Commons vote on new clause 49, proposing a referendum on the Maastricht treaty—the so-called treaty on the European Union.

I know the hon. Member for Stone (Mr Cash) supported the clause. It is a shame that the hon. Member for Stockton South did not put him on the Committee. I am sure that he has already made representations that he would have loved to be on the Committee discussing with us, this evening, the Bill’s constitutional implications, our place in the EU and what it would mean to leave it. [Interruption.] We might have been here even longer. I think that the Minister was making a similar comment; the hon. Member for Stone is well known to us.

Photo of Martin Horwood Martin Horwood Liberal Democrat, Cheltenham

The hon. Lady makes an important point. If the hon. Member for Stone were here, he would certainly be contributing to the debate. We are stretching the sitting late into the night, and we are yet to see how long that will continue, but if that is the way the promoter and sponsors of the Bill want to carry on proceedings we are happy to do that, as I am sure the Opposition are. In that context, the hon. Member for Stone would undoubtedly make a debate of it, and answer some of the criticisms that are being made.

Photo of Joe Benton Joe Benton Labour, Bootle

Order. The hon. Member for Stone is not a member of the Committee and I am sure if he were here he would speak for himself. We are going slightly off the amendment when we discuss what the hon. Gentleman would probably say or not say if he were here.

Photo of Emma Reynolds Emma Reynolds Shadow Minister (Foreign and Commonwealth Affairs)

Thank you, Mr Benton. I am grateful for your guidance. As my hon. Friend the Member for Huddersfield pointed out when he was here, there are many new members of the Committee. We have been Members of the House a bit more than five minutes—but only three years; however, you have been here for many years, so I welcome your guidance and useful advice. I do not want to predict what the hon. Member for Stone would say, but he voted for a referendum on the Maastricht treaty. Unlike the Foreign Secretary he has been consistent on those matters since before 1993.

The Division on 21 April 1993 was about a massive transfer of powers. I suggest we should amend the Bill to stipulate a referendum for a transfer of powers, and particularly if it is as clear-cut as it was under the Maastricht treaty or the Single European Act. I imagine the 1993 debate was long. There were 363 votes against the referendum clause and 124 for. I have the Division list here.

Interestingly, the Foreign Secretary is among those who were against the referendum, so why are the Government—I apologise to the hon. Member for Cheltenham: it is very tempting to say “the Government”, because we always have these debates between the Government and the Opposition—why did the Conservative party and its senior Ministers, such as the Foreign Secretary, deem it not necessary or appropriate or constitutionally significant to have a referendum on the Maastricht treaty or the Single European Act, but appropriate to have a referendum on no change to our relationship with the European Union? It seems both odd and inconsistent with the way in which the Foreign Secretary voted on 21 April 1993.

We have had treaty changes since that time. We did not promise or deliver a referendum on the Amsterdam treaty or on Nice, but we have constructively engaged with the agreement that was made in good faith with the Liberal Democrats in the coalition agreement negotiation with regard to a referendum lock on any significant transfer of powers.

I want to talk to my new schedule in the context of what might in the outside world be considered minor changes, such as the introduction of the European Public Prosecutor’s Office, which was stated in the Bill. I am not suggesting that there should be a referendum on it, but there is a change that would be much more significant but is not included either in the referendum lock legislation or in my amendments. If Turkey were to join the European Union, it would have a significant impact, way beyond anything that the introduction of the prosecutor’s office would have, in terms of the dilution of our voting power in the Council of Ministers under the qualified majority voting rules that I have been talking about, because Turkey has a massive, growing and very young population compared with some of the ageing populations around the European Union.

Photo of Martin Horwood Martin Horwood Liberal Democrat, Cheltenham

I find it slightly odd that it is I who am putting this response to the hon. Lady from the Government side, in the context of a European Act that most Government Members supported, but in the absence of a response from Conservative Members—there is silence around me—let me put the case, which is that there is no denying that there would be implications if Turkey joined the European Union, just as there were implications when large states such as Bulgaria and Romania joined, but that does not involve any real points of principle in which there is a transfer of power from the British to the European level of government, whereas the triggers in the EU Act are about such transfers of competences or powers.

While the appointment of a European public prosecutor, and our participation in that, may or may not be of massive significance to members of the Labour party, or even perhaps to members, supporters or advisers of the Liberal Democrats, it was clearly of critical importance to Conservative Members, so it was right for us as a Government to respect our coalition colleagues and include that in the list. It was, if only in a small way, a shift in principle of power between—

Photo of Martin Horwood Martin Horwood Liberal Democrat, Cheltenham

It is not a speech, actually; I am simply replying to the precise point made.

Photo of Joe Benton Joe Benton Labour, Bootle 9:15, 17 July 2013

Order. It is coming now to a speech.

Photo of Emma Reynolds Emma Reynolds Shadow Minister (Foreign and Commonwealth Affairs)

I understand the hon. Gentleman, who was being forensic in talking about the legislation that has already been passed. Certainly, in a manner of speaking, the dilution of our voting power in the Council of Ministers could conceivably be called a transfer of power, but in the definition agreed in the referendum—not legislation—it was not considered one. I am just comparing it with what I thought was a fairly insubstantial change, the introduction of the European Public Prosecutor’s Office. It is a question of judgment. Perhaps the hon. Member for Cheltenham has a different view. I am willing to argue it out with him.

In terms of the impact on our relationship with the EU as a whole, the accession of Turkey would have substantial implications. I am not saying that they would be negative; I am just saying that it would be a big change geographically and strategically, in terms of foreign policy and of the make-up of the EU. I am certainly not arguing against Turkey’s accession; I am simply trying to put my finger on what I think are anomalies in the legislation already passed. I hope that I have got round those in my amendments.

It is difficult, as this discussion has reflected, to know exactly where to set the threshold for a significant transfer of power. If, for example—we talked about this earlier—the UK got the European commissioner portfolio for multilingualism, would it be rational or proportionate to suggest that that was a transfer of power? Would it be a transfer of power for us to get a minor portfolio in the European Commission? Some hon. Members, either in this Committee or beyond—I will not mention the hon. Member for Stone today, because we are not supposed to talk about him—might well argue that that was a transfer of power. I think that I am right in saying—the hon. Member for Cheltenham will correct me if I am wrong, because he is such an assiduous Member and such an expert in these matters—that that would not trigger a referendum under the legislation that we have agreed, nor do I think it should. We must restrict referendums to significant transfers of power, which is what my amendment would achieve.

It seems rational, especially given the changes taking place in the European Union, that if there is a substantial change in our relationship with the EU, people should have a say in it. The Labour party is not opposed to a referendum in those circumstances, and I do not think that the Liberal Democrats are either; I am sure that the hon. Member for Cheltenham will tell me if I am speaking out of turn. Given that he is silent, I suspect that I am right.

It therefore seems proportionate to me that we should write it into the Bill that there should be a referendum if there is a transfer of power. I would welcome any feedback from those on the Conservative Benches on that issue.

They do not seem to be paying a lot of attention to what is being discussed, but I am sure that they have their own view on my amendments, and one of them will have to respond before we conclude the debate, whatever the hour might be.

The other arguments I want to prosecute and the other amendments I want to address are those on the wording of the question. As I said in my earlier  interventions, that is a key part of our scrutiny and I hope other hon. Members will contribute, because the Committee should scrutinise and debate the issues. I would welcome contributions from any hon. Member who has not spoken yet—or much—including Conservative hon. Members.

Photo of William Bain William Bain Shadow Minister (Scotland)

My hon. Friend is entirely right that such scrutiny is one of the most important functions the Committee has to engage in with respect to the Bill. We have not had the full reports we would have preferred from the Electoral Commission on whether, according to its criteria, the criteria in the Political Parties, Elections and Referendums Act 2000 are met, so is it not essential that we spend a good deal of time looking at the intent of the wording in the question in clause 1(4)? As we saw in the debates on the referendum in Scotland, words mean absolutely everything when it comes to the question. Given that we have not had the Electoral Commission’s verdict, it is doubly a priority that we carefully consider the amendment and clause 1(4).

Photo of Emma Reynolds Emma Reynolds Shadow Minister (Foreign and Commonwealth Affairs)

I thank my hon. Friend for that useful intervention. It would have been better for us to have had guidance from the Electoral Commission, as has been standard practice in all the other referendums in recent years. We had the referendum on—I nearly said “alternative vote” again, but I had better not; it was the alternative vote, but not what the Liberal Democrats wanted in the first place. There was Electoral Commission consultation on the nature of the question on the alternative vote. From what I understand of Electoral Commission guidance in that case, it was keen to ensure that the question was as neutral as possible: that it did not lead to a specific answer from the electorate and did not give one side any advantage over the other. Not only was the question debated on the Floor of the House, but the Bill that enabled the referendum was debated pretty thoroughly. I would welcome contributions from Conservative hon. Members, if they have anything to say on the question, because that matter goes to the heart of the issue.

The question, as drafted by the hon. Member for Stockton South, reads:

“Do you think that the United Kingdom should be a member of the European Union?”

One implication of that formulation is that it suggests that the UK is not yet a member of the EU. Look at it as dispassionately and objectively as possible—

“should the UK be a member”?

The UK is clearly already a member. When I knock on doors in my constituency, I find that sometimes people confuse the euro with the EU, saying, “Oh, you don’t think we should go in, do you?” They elide the two issues. It would have been better if the hon. Gentleman had used the Prime Minister’s formulation—this is perhaps one rare area on which I agree with the Prime Minister. When he was in Washington and very keen to get a draft referendum Bill into the newspapers, the question, as my hon. Friend the Member for Lewisham West and Penge has pointed out—this relates to the sense of my amendment—read:

“Do you think the United Kingdom should remain a member of the European Union?”

That seems a much more neutral and dispassionate question.

Photo of William Bain William Bain Shadow Minister (Scotland)

My hon. Friend is absolutely right. One can only speculate as to whether the Prime Minister has perhaps been spending a little too much time with his barbecue recently, and not enough on helping the hon. Member for Stockton South to consider the implication of the wording of the question in subsection (4), although doing so would certainly have been a useful exercise.

My hon. Friend is discussing a critical issue. In relation to the referendum in Scotland, it is beyond doubt that the effect of the question on which the Scottish Parliament has been asked to legislate could be Scotland leaving the United Kingdom, but there is some doubt whether the phrasing of the question in the Bill makes it clear enough that the United Kingdom would be asked to leave the European Union altogether. Does she not think that that needs to be resolved by the hon. Member for Stockton South?

Photo of Emma Reynolds Emma Reynolds Shadow Minister (Foreign and Commonwealth Affairs)

Given that the hon. Member for Stockton South is the Bill’s promoter, I am astonished by his silence on the matter and by the fact that he has not contributed significantly to the debate. I hope that he contributes, because I want to debate the issue with him. It is in the interests of the whole House and the whole country that we have a debate, not least on that critical question, as my hon. Friend says, as well as on other elements of the Bill. I am sure that the hon. Gentleman’s iPad is extremely interesting, but given that this is his moment in the spotlight, I would have thought—

Photo of James Wharton James Wharton Conservative, Stockton South

On a point of order, Mr Benton. Fascinating and relevant to the amendment as the question whether I choose to contribute or reply to the points made might be, the hon. Lady has been speaking for quite some time and has explored the issues in great detail. Is it unreasonable to suggest that the question on the amendment should now be put?

Photo of Joe Benton Joe Benton Labour, Bootle

The ruling is very simple: 25 amendments are under discussion and a range of topics are being raised. The scope of the amendments is very broad and I see nothing out of order in discussing them in full detail and at length. Some amendments have still not been spoken to. To be fair, that is not my or the Committee’s fault.

There are 25 amendments in the group, and there is not much we can do about that. I want to be perfectly fair: it is only right and proper that the amendments get a good airing. I am sorry, but it is not appropriate to put the question, because, frankly, in my opinion the scope of the amendments has not been adequately dealt with as yet. We have not had contributions from any other Member—the hon. Lady is still moving the amendment—so I am sorry, but until I feel that adequate consideration has been given to the 25 amendments, we will have to go on in this vein.

Photo of Emma Reynolds Emma Reynolds Shadow Minister (Foreign and Commonwealth Affairs)

I am extremely grateful for your guidance, Mr Benton.

As I said earlier, I am sympathetic to the hon. Member for Stockton South in a way, in that I have not previously been involved with a private Member’s Bill and I am not entirely sure of all the rules. This place has many strange rules with which I am not fully up to date. I still  have quite a number of points to make. I tabled a significant number of the amendments in the group, and I have not yet covered all their subjects. I welcome your guidance, Mr Benton.

One other suggestion is that the question in subsection (4) be formulated in a more negative way. Some would argue that that would be more straightforward.

Instead of

“Do you think that the United Kingdom should be a member of the European Union?” or “Do you think that the United Kingdom should remain a member of the European Union?” it could be “Should the United Kingdom leave the European Union?” If we had more time and could have an evidence session with the Electoral Commission, or if we at least had a chance to sit down with the Electoral Commission, we could discuss the pros and cons of that suggestion. I have tabled my own amendment but there are a range of questions with similar meanings but subtly different nuances and implications. It would be good to have a dispassionate and objective point of reference for this critical element of the Bill.

Photo of William Bain William Bain Shadow Minister (Scotland) 9:30, 17 July 2013

I am grateful to my hon. Friend for giving way again. I am loth to raise the issue of a second question, not least because much political activity in Scotland was spent in that referendum discussion avoiding having a second question. Does she agree that it would be possible to append some words to the single question in subsection (4) to deal with the important issue of whether the proposal of the hon. Member for Stockton South would involve us leaving the European Union but remaining a member state of the European economic area? Would there not need to be some expression appended to the question to deal with that position and, if that were not his position, the question whether we would be permitted to remain within a customs union with the European Union? Do not these sorts of issues need to be addressed when we are considering the question?

Photo of Emma Reynolds Emma Reynolds Shadow Minister (Foreign and Commonwealth Affairs)

It is useful and instructive for the Committee to consider the discussions that took place on Scottish independence. Many of the issues are similar, not least the economic uncertainty that has been caused by having a referendum in Scotland next year rather than sooner. As my hon. Friend mentioned, there is also the wording of the question. The wording of the question here is not dissimilar to the type of question that is being asked in the Scottish referendum. There would be merit in not only amending the original question in the way I have described, but adding questions so that we could have an even fuller and more comprehensive consultation with the British people.

One of the ambiguities here is that if the answer to

“Do you think that the United Kingdom should be a member of the European Union?” is no, those who choose to vote in the referendum might also like to have choice about an alternative. There are different alternatives. We could totally go it alone and not be a member of the European economic area. We could choose not to have access to the single market.  We could not be in the customs union. I have tabled a fair few amendments, but if there had been more time, I would have tabled more.

It would be proper for the full scrutiny of the Bill to consider whether we could add two questions to the one already in the Bill: “Do you think that the United Kingdom should be a member of the European economic area?” and “Do you think that the United Kingdom should be a member of the customs union?” The other way of formulating the question is to remove entirely the “Do you think”. For example,

“Do you think that the United Kingdom should be a member of the European Union?” could be replaced with “Should the United Kingdom be a member of the European Union?” or “Should the United Kingdom remain a member of the European Union?” The second question would then be “Should the United Kingdom be a member of the European economic area?” and the third would become “Should the United Kingdom be a member of the customs union?” All the different formulations have subtle and different implications, which is why I am keen that we have sufficient time to debate such issues.

As my hon. Friend the Member for Glasgow North East said, that is the nub of the issue. The nature, formulation and wording of the question, particularly if the wording is leading, are critical to the Bill. The question is the Bill’s central point. The Scottish experience is instructive, but the 1975 experience is equally so. In February of that year, prior to the referendum, a consultation was held on the question being put to the British people. In a White Paper, the Labour Government of the day said:

“Some argue that the precise wording of the question can have a significant effect upon the result.”

That is absolutely true, which is why the wording is so critical. The then Government were pretty open, as I understand it, about the wording, because they said in the White Paper that they were

“not yet committed to any form of words but following consultations with the political parties represented in Parliament and the leading campaigning organisations they propose for discussion that the ballot paper should read as follows…

DO YOU THINK THAT THE UNITED KINGDOM SHOULD STAY IN THE EUROPEAN COMMUNITY?”

I would love to be able to say that other political parties have been consulted. Given the significant constitutional implications, I would have thought that, even though the political parties differ on the issue, if the Bill is, as I am sure the hon. Member for Stockton South wants, to become law, a consultation on the wording of the question prior to or after the Bill would have been a much better way of proceeding. That is what happened in 1975.

Photo of William Bain William Bain Shadow Minister (Scotland)

I want to strengthen and bolster my hon. Friend’s excellent case for an amendment by inviting her to consider what happened in the referendums in Quebec in 1980 and 1995 on whether it should become a separate state. As my hon. Friend may recall, there was huge controversy in 1995 because the question in that referendum talked only about sovereignty. Given how interested we know Government Members—particularly Conservative Members—are in the issue of  sovereignty, do we not need to explore all of the options for wording, drawing on best practice from referendums that have been held right across the globe?

Photo of Emma Reynolds Emma Reynolds Shadow Minister (Foreign and Commonwealth Affairs)

My hon. Friend is absolutely right. The wording of the question will be key to how the results of any referendum will be viewed, not only in our own country but across the European Union.

Photo of Martin Horwood Martin Horwood Liberal Democrat, Cheltenham

There is another interesting dimension to the Quebec referendums, especially the second one, which is that it was won by an absolutely minuscule percentage. I cannot remember exactly what the figure was, but it was much less than 1%. In those kind of circumstances, the precise wording of a question—a slight nuance that might tip a very small percentage of voters one way or the other—is actually quite important and could easily affect the outcome of the referendum. Quite a lot of referendums have been decided by a very small percentage—I think one of the Scottish referendums was, for example. These matters are of considerable importance in some circumstances.

Photo of Emma Reynolds Emma Reynolds Shadow Minister (Foreign and Commonwealth Affairs)

I could not agree more. There are pro-Europeans in the Conservative party and other parties who think that, if we were to have a referendum on our membership of the European Union, first we would stand a good chance of winning, but secondly that we would draw a line under the issue. If a referendum on our membership were held, let us say for the sake of argument, some time in 2017, and the experience of Quebec was repeated, because the majority in that hypothetical referendum was minuscule—the word used by the hon. Member for Cheltenham—there would probably be a major consideration of the nature of the question; that is what has happened in other cases. It would not be in the interests of this country to have a referendum that resulted in a minuscule majority, as there would continue to be a debate about whether we have drawn a line under the issue. It is in the country’s interests that if there is a referendum, it draws a line in the sand about whether we are in or out.

I am grateful to the hon. Gentleman for raising that example, because it goes to the heart of the issue. We have to get the question right. This is not a matter of pro-Europeans versus Eurosceptics; it is for the good of hon. Members across the House, Eurosceptics and pro-Europeans alike, that we get the formulation, the wording and the subtle implications of the question right.

Photo of William Bain William Bain Shadow Minister (Scotland)

I emphasise how important this issue is by pointing to the referendums that have taken place in other EU member states. For example, Ireland has sometimes held two referendums on an issue because the outcome in the first was indecisive owing to issues about the question. Would it not be an appalling waste of public money if, because a poorly drafted question had been put to the public, there was a very contentious outcome leading, potentially, to further tens of millions of pounds of public money being spent on a second referendum?

Photo of Emma Reynolds Emma Reynolds Shadow Minister (Foreign and Commonwealth Affairs)

My hon. Friend is right. Yesterday, we debated the Government’s money resolution. During that debate, the Europe Minister, who unfortunately is not in his place this evening, talked about a sum of money, but said that it would be open to further scrutiny  and was not perhaps finalised. The sum of money that was being discussed last night was, I think, £75 million, so if the referendum had to be held again, that would cost another £75 million. During the money resolution debate yesterday one of my hon. Friends asked whether this is the right priority, given there are cuts across the country to local authority budgets and other budgets. One argument is to have one referendum. However, if we got the question wrong, it would double the cost. That would be of significant concern to my constituents and to those of other hon. Members.

On the formulation of the question, there is something else that the hon. Member for Stockton South and the Committee could consider in an amendment. In January, the Prime Minister talked about renegotiation and repatriation. That could appear on the ballot paper. The 1975 White Paper suggested, before the question, including a section that reads:

"The Government have announced the results of the renegotiation of the United Kingdom's terms of membership of the European Community.”

We could add a similar, short sentence to the Bill, should the hon. Member for Stockton South think it appropriate, because that is what the Prime Minister has suggested he wants to do. It would help my constituents and the electorate across the country to have as much information as possible on the ballot paper. Some hon. Members might suggest that is too much information, but that is something we can debate. I welcome views from across the House. However, it would seem more accurately to reflect the approach of the current Government.

It might be that the Government that takes power in 2015 does not want that sentence to be included on the ballot paper. But that is why—I return to amendment 30—the nature and the implications of the Bill are problematic. The Bill seeks to bind a future Parliament. If the Conservatives were to win in 2015 with an outright majority, they might welcome a reference to repatriation or renegotiation on the ballot paper. The pro-Europeans in the Conservative party—they are small in number, but there are some significant members of that group—might feel it strengthens their case and gives more information to the British people about what the Conservative Government has achieved. If we were in power, we might not consider it to be appropriate. If the Liberal Democrats win a majority in 2015, as I am sure they hope to, they might to choose a different formulation. It would depend on the Government of the day.

The question of the preamble demonstrates the problem of seeking to bind future Parliaments. I would prefer, although I have not tabled an amendment to this effect—I am sorry I have not done that, but I have not had very much time—that we reserve judgment on what the question should be until nearer the time of the referendum. As I have already outlined, the changing nature of our relationship with the EU is such that what seems relevant in 2013 might not seem relevant in four years’ time. Therefore, I think there should be some flexibility on the wording of the question.

Instead of stating the question in the Bill, the Bill could simply say—although I do not agree with this—that there will be a referendum before 31 December 2017, but at a date to be determined, the Government who  laid the order before Parliament should come up with a formulation and wording that seems appropriate at that time. It would be perfectly constitutional for the Secretary of State, as is formulated here, or the Prime Minister, as is formulated in my amendment 35, for that senior politician, when they lay the order before the House as is stated in clause 1(3), to consult on a cross-party basis on the formulation of the question.

That would follow the precedent that has been set in other referendums, such as the one in 1975. As I mentioned, there was consultation by the Labour Government at the time with the other political parties as to the formulation of the question. I believe that it would follow the precedent of referendums post-1975. I am sure that my hon. Friend, who has much more experience in Scotland than I do, will be able to instruct the Committee as to the nature of the negotiations that came about with regard to the question in the Scottish referendum. It seems that it is at least a convention and certainly a precedent that there is cross-party consensus and cross-party consultation.

Photo of Martin Horwood Martin Horwood Liberal Democrat, Cheltenham 9:45, 17 July 2013

I will obviously defer to the hon. Member for Glasgow North East who I am sure is much more of an expert on the subject of the Scottish referendum and the development of the question. However, as a Sassenach observer to the process, it did seem to get mired in controversy between the First Minister and the Prime Minister in London. That emphasises the need to try to extract these debates from party-political calculation and advantage, which I am afraid seems to be the direction in which the Bill is travelling.

It also emphasises the importance of having the Electoral Commission know, which was the whole basis of the elections and referendums Bill provisions; for it to be involved in the question. I absolutely agree with the hon. Lady that is important for people’s confidence in the referendum outcome, whichever side they are on, for the question to have consensus behind it.

Photo of Emma Reynolds Emma Reynolds Shadow Minister (Foreign and Commonwealth Affairs)

I thank the hon. Gentleman for that intervention. It is pretty unedifying for there to be this sort of dispute over the words. We could avoid that in this situation by not having the question in the Bill but to defer it to a time nearer the deadline that is set in the Bill. I would prefer the deadline not to be set in the Bill, but we could try to avoid the sort of spat that the Gentleman was talking about between the First Minister and the Prime Minister, and perhaps some hon. Members in our party too. We should try to avoid that sort of party-political wrangling over the question. I do not think that it is in anybody’s interest; not for those who are keen for us to have a referendum now or in 2017 and not for those who want either to leave or to stay in the European Union. These matters need to be discussed in a calm and rational manner. That is why I suggest that we simply defer the formulation of the question until 2016.

Photo of William Bain William Bain Shadow Minister (Scotland)

I am most grateful to my hon. Friend for giving way again. The reason why her amendments are so necessary, and hopefully will be adopted by the Committee at some stage, is that in relation to Scotland, to draw the parallel with that referendum, it was not just the question that became contentious; it became whether the Electoral Commission was going to have  responsibility for overseeing the referendum at all. Whether the rules that the Electoral Commission has devised for the fair handling of any referendum, including over campaign funding would apply to this referendum was also an issue. Does my hon. Friend share my concern that we have not seen in the Bill, particularly in clause 1 as it is currently drafted, any reference to campaign finance or funding, or any reference to the Electoral Commission’s continuing or any supervisory role over this purported referendum?

Photo of Emma Reynolds Emma Reynolds Shadow Minister (Foreign and Commonwealth Affairs)

That is useful information in terms of the consideration of the referendum. My hon. Friend has conveyed to the Committee the problems that occurred in Scotland. If we are serious about the Bill becoming law, we should seek to avoid formulating the Bill in such a way that leads to similar problems and disagreements, which the hon. Member for Cheltenham also commented on. If I had had time to table more amendments and to consider the issue in more detail, I would have been minded to table an amendment that would totally change subsection (4) so that the formulation of the question would be deferred to 2016. That would be an appropriate and considered way to proceed.

Photo of William Bain William Bain Shadow Minister (Scotland)

I am most grateful to my hon. Friend for giving way once again; she has been most generous.

Does my hon. Friend share my belief—this is another reason why I would endorse her amendments—that the reason why the amendments are required is that subsection (3) appears to grant the Secretary of State a wide discretion to appoint the date of the referendum before 31 December 2016? It strikes me—I wonder whether this also strikes my hon. Friend—that there could be considerable political changes in the European Union even after that date but before the deadline set out in subsection (2)? For example, French presidential elections are due in May 2017, which could have a dramatic impact on the nature of the European Union as it might develop in forthcoming years.

Photo of Emma Reynolds Emma Reynolds Shadow Minister (Foreign and Commonwealth Affairs)

I could not agree more with my hon. Friend. As I said earlier, significant elections are coming up. He mentioned the French presidential elections, which will have a big impact on how the European Union develops.

Another significant date in 2017, which I think passed the Prime Minister by in January when he announced the date, is 1 January 2017, which I believe is when the British presidency of the European Union starts. Although it could be considered that a referendum should take place that year alongside local elections to save money, it might not be appropriate to have a referendum on our membership of the European Union during the period in which we are in charge of driving the agenda of the Council, given our presidency, and the European Union.

My hon. Friend’s point about the French presidential elections and my own point about the British presidency in the first half of 2017 show how little thought through this arbitrary deadline of 31 December 2017 is. Is the Conservative party—perhaps a Conservative Member would like to respond to this—suggesting that a referendum on our membership of the European Union should take  place in May 2017, when the British Government are busy organising the agenda and being the driving force of negotiations between EU member states for a six-month period? Or would we be forced to have a referendum in August, September, October, November or December? We have seen how short days and bad weather drove down participation in November. It was one reason why we did not have good participation in the election of police and crime commissioners.

If we proceed with the Bill, and if the referendum were to go ahead in 2017, it would be in all our interests for as many of our electorate as possible to participate. I suggest that the referendum should take place at the time of a general election, a European election or a local election. Having such a tight time frame set out in the Bill makes that almost impossible.

Photo of William Bain William Bain Shadow Minister (Scotland) 10:00, 17 July 2013

If a referendum were held on the basis that my hon. Friend mentions, there would also be important Electoral Commission rules about what documentation could be supplied to voters. In the 1975 referendum, every household in the country was given a copy of the second White Paper that Prime Minister Harold Wilson had presented to Parliament. In other referendums in Europe, copies of, for example, the Maastricht treaty have been delivered. I cannot contemplate the expression on the faces of some Government Members if, in 1992—if they had been eligible to vote—they had been delivered a copy of the Maastricht treaty. If voters are to be provided with proper information by the Government in relation to this referendum, the rules for doing so will have to be confirmed by the Electoral Commission, and they are not in the Bill as it is currently framed. Is that not a concern?

Photo of Emma Reynolds Emma Reynolds Shadow Minister (Foreign and Commonwealth Affairs)

My hon. Friend makes a useful contribution. The role of the Electoral Commission is key to the successful holding of any referendum. We have seen the problems that were encountered in Scotland. [Interruption.] The Minister for Europe has returned to the Committee Room just in time, because I was about to refer to him. Last night, he estimated the cost of a referendum at £75.3 million, which was also the cost of the alternative vote system referendum, but the timing under discussion now means that there could be a significant variation in cost. As I have suggested, it would not be appropriate to have a referendum in 2017, right in the middle of our presidency of the European Union. Therefore, the Conservative party should tell us whether it would be more expensive—I guess it would be, and perhaps we could have an estimation of the cost—to hold the referendum later in 2017.

That brings us nicely on to the other amendments under consideration. My hon. Friend the Member for Huddersfield, who unfortunately is not here this evening, and my hon. Friend the Member for Lewisham West and Penge have tabled a number of amendments about the timing of a future referendum on our membership of the European Union. Under amendment 4, there would be a referendum on 22 May next year. That is not my party’s policy, but there is a certain logic to the suggestion. It would be logical, at the time of a European election in 2014, 2019 or 2024, to put the question about our membership of the European Union on the  same day. At European elections, the electorate are asked to elect their local Members of the European Parliament, so they are already considering issues with implications for European Union decision making. I do not necessarily agree with the 2014 date, but I can see that there are logical reasons for choosing that date.

Amendment 5, which is not in my name but in those of my hon. Friends the Members for Huddersfield and for Lewisham West and Penge, suggests that the referendum should take place on 6 May 2015—the same day as the general election. Again, I am not saying that I support its substance, but a more logical argument can be made for having 6 May 2015 as the date than for having an arbitrary deadline at the end of 2017.

Photo of William Bain William Bain Shadow Minister (Scotland)

Again, while reserving any opinion on the substance of the amendment, would my hon. Friend concede that having a referendum on such a date, regardless of whether Labour supported it, would at least mean that Ministers would have to come to the House to spell out the implications of a yes vote or a no vote? It is great to see the Minister for Europe in the Committee once again, but when will we hear from the Government about the effects of the vote recommended by the hon. Member for Stockton South?

Photo of Emma Reynolds Emma Reynolds Shadow Minister (Foreign and Commonwealth Affairs)

I agree with my hon. Friend. Although I do not agree with the substance of amendments 4 and 5, there is logic to them. If they were accepted, Ministers, such as the Europe Minister, would be obliged to come to the House to set out the advantages of staying in the EU and the costs of leaving it. Only last night, the Foreign Secretary delivered a speech at the Open Europe event in which he talked about economic membership of the single market bringing important economic benefits, but there were no data about what those would be.

When, or if, the Minister responds to the debate, Opposition Members would like greater clarity from the Government, or the Conservative side of the Government, about the implications of the outcome of any referendum. In considering the Bill, it would be useful for the Committee to have the balance of competences report we have discussed—the Minister was not here earlier, but I wonder whether he could tell us when it might be published and whether we might have it in time for our next sitting, in September. However, it would also be useful, as my hon. Friend the Member for Glasgow North East said, to hear what the implications of leaving the European Union would be. I have tabled written parliamentary questions about that, and the Government have refused to estimate the cost of leaving. If we are to have a substantial debate about the implications of a referendum and a negative outcome, we would benefit from having that information.

To be thorough, let me reflect on the other amendments in the group. I have discussed amendment 5—in fact, I only got to amendment 5, I am afraid. My hon. Friends the Members for Huddersfield and for Lewisham West and Penge tabled that amendment, which would leave out “before 31 December 2017” and insert “on 6 May 2015”. I am not saying that I agree with that amendment, but there is a logical argument for trying to settle the issue before the next general election. I believe that the economy will be the defining issue at the next general election, but there is a rational case for asking why hon.  Members who want a referendum do not want it now. If my hon. Friends the Members for Huddersfield and for Lewisham West and Penge were here, they might argue that it would be better to settle the question of our membership of the European Union before the next general election. That seems a more logical scenario than the date in the Bill.

Amendment 7 refers to holding a referendum before 31 December 2015. Again, there seems to be a logical explanation for that, because it would leave it open for the date of the referendum to be on the same day as the general election. That might come early, so it might be better not to set 6 May 2015 in stone, as amendment 5 would do. If my hon. Friends the Members for Huddersfield and for Lewisham West and Penge were here, they might argue that it would be better to ensure that it could coincide with the general election, because there is a possibility of it coming earlier. Obviously it cannot be later 6 May 2015, because we have fixed-term Parliaments, but it is possible that the Government might collapse. I am not saying that that is likely, but it is a constitutional possibility.

Amendment 8 refers to replacing “31 December 2017” with “31 December 2016”. That would move the referendum forward, and it would be within the 18 months of a new Government coming to power. The argument for that might be to settle the issue sooner rather than later.

Photo of William Bain William Bain Shadow Minister (Scotland)

On amendment 5, and the nature of the Government who will be in office on 5 May 2015, the day preceding the next general election, does the hon. Lady have any concern about the breadth of the power conferred on the Government by clause 1(3)? At the moment, as the hon. Member for Cheltenham informed us, we have a coalition Government. Does the hon. Lady share my concern that if there were, as has been speculated, a Conservative-led caretaker Government because the coalition had come to an end, a Conservative Foreign Secretary in a purely Conservative Government would have the power to operate in ways that would not be in the national interest in setting a date?

Photo of Emma Reynolds Emma Reynolds Shadow Minister (Foreign and Commonwealth Affairs)

That is perfectly possible. The truth is that the current Government introduced fixed-term Parliaments, which I support because when we were in government there was a lot of pressure to hold a referendum and constant speculation about the date of the next general election is not helpful. Fixed-term Parliaments steer us away from speculation about the date of the next election, and although I would not put money on it, I think it is extremely likely that the next general election will take place on 6 May 2015, but still do not know in what circumstances it will take place.

The Liberal Democrats might decide six months before 6 May 2015 that they want to withdraw their support from the Government, and there might be a minority Conservative Government during those six months. As my hon. Friend the Member for Glasgow North East suggested, it would then be open to a Conservative Foreign Secretary in a Conservative minority Government to lay the order as set out in clause 1(3). The only impediment to that—it would be a hurdle that a Conservative Foreign Secretary in a Conservative minority Government would have to get over—would be that they would have to get a majority in the House of  Commons and House of Lords. If the Liberal Democrats, by that stage, had left the Government, it is even more unlikely that they would support them in that endeavour.

It is possible, although it may be highly unlikely, depending on—[Interruption.] The hon. Member for Cheltenham is frowning at us.

Photo of Martin Horwood Martin Horwood Liberal Democrat, Cheltenham 10:15, 17 July 2013

I am slightly distracted by the conversation behind me, so I did not quite catch the scenario in which we were walking out of the Government. I do not think that that is likely to happen. Perhaps the hon. Lady might repeat the scenario she is describing.

Photo of Emma Reynolds Emma Reynolds Shadow Minister (Foreign and Commonwealth Affairs)

I know that the hon. Gentleman gets on well with the Europe Minister. I have attended debates with both of them on many occasions. When it was suggested that the coalition would not fall apart, I saw that the hon. Gentleman was in great agreement. It is highly unlikely, but not impossible, that the Conservatives will have a minority Government for the last six months of the Parliament until May 2015. I am not saying that that is likely, but we were considering whether the different dates that we have been discussing might come to pass and also whether there might be an attempt to call a referendum earlier rather than later. I am not suggesting, and I do not think that my hon. Friend the Member for Glasgow North East is suggesting, that this will come to pass. We are simply saying that, constitutionally, it is a possibility.

The arbitrary date of 2017 is not well thought through, because many possible scenarios could develop before the end of that year. I would not want to invite further debate about whether the Government will stay the course. It is likely that they will, but it is not impossible that the coalition will not continue in its present form.

In amendment 9, my hon. Friends the Members for Huddersfield and for Lewisham West and Penge suggest a deadline of 1 July 2017, instead of 31 December 2017. If Members are wedded to an amendment to make the date some time in 2017, perhaps it would be better to get it over earlier rather than later. The Europe Minister will be well aware, because he is such an expert in such matters, that the British presidency of the European Union takes place in 2017. [Interruption.] I am led to believe that that is so. Perhaps the Minister will check with his officials.

Under amendment 10, the deadline would be shifted from 31 December 2017 to 31 December 2018. I am not convinced that some of the issues that I have been discussing about the dynamics between the eurozone and the non-eurozone will be—[Interruption.]

Photo of Joe Benton Joe Benton Labour, Bootle

Order. There is too much muttering going on around the room. Could I ask Committee members and those in the public gallery to keep their voices down?

Photo of Emma Reynolds Emma Reynolds Shadow Minister (Foreign and Commonwealth Affairs)

Thank you, Mr Benton. That is helpful. It would be easier if there were not many separate conversations going on at the same time as I am trying to make a speech.

Amendment 10 would at least provide a little more time to see how the nature of our relationship with the EU was developing. It would also give us time to see the nature of European integration of the eurozone 17, which by then will probably be more than 17, and developments on the whole debate about the EU and where we are in relation to it. I can see the logic in that line of reasoning, but I would prefer not to have a deadline written in the Bill.

Amendment 11, tabled by my hon. Friends the Members for Huddersfield and for Lewisham West and Penge, suggests replacing the deadline of 31 December 2017 with 31 December 2019. That would allow for a referendum on our membership to take place at the same time as the 2019 European elections. There is merit, financially and to ensure that the franchise is as wide as possible, in ensuring that the referendum coincides with a significant election. That date would be appropriate because elections to the European Parliament are, of course, about European decision making and our representation politically in that important institution, which now has co-decision with the European Council in many areas.

Photo of William Bain William Bain Shadow Minister (Scotland)

The other implication of having the referendum around that date would be having the first UK-wide parliamentary elections since the full roll-out of individual voter registration, so it would therefore be an important means to determine whether that scheme was workable before the 2020 general election.

Photo of Emma Reynolds Emma Reynolds Shadow Minister (Foreign and Commonwealth Affairs)

I take my hon. Friend’s point. There are deep concerns about the introduction of individual registration and its implications. That would certainly be a test of whether individuals had registered or whether the number of people on the electoral register had decreased. We simply do not know. I am sure the Parliamentary Secretary, Cabinet Office, knows those arguments inside out—much better than I do—so I would not want to embark on a debate about that with her. It is a key point that we will not know the effect of introduction of individual voter registration until it happens. This would be the first nationwide ballot following its introduction, so it would be good test case before the 2020 general election.

That brings me to amendment 12, tabled by my hon. Friends the Members for Huddersfield and for Lewisham West and Penge. It would replace the deadline of 31 December 2017 with the date of the general election in May 2020. Again, there is logic and a rationale to the amendment. Should the next Government be Conservative —we hope not—at least the Prime Minister, if still in post, would have had from 2015 to 2020 to pursue that renegotiation. At the moment, he intends to do that in the next four years, although he has only two years between 2015 and 2017, as we have already discussed.

Photo of William Bain William Bain Shadow Minister (Scotland)

I am struck by an interesting thought—[ Interruption. ] I have many others that I can share with the Committee in the hours to come. While the coalition being returned at the next general election is a horrible possibility for me and my hon. Friend to contemplate, in other countries the leader of the smaller of the two coalition parties has been appointed Foreign Secretary. Does that not raise the possibility that the Deputy Prime Minister could be charged with laying such an  order? Does she believe that the hon. Member for Stockton South, or indeed the Minister for Europe, would think that a good possibility?

Photo of Chloe Smith Chloe Smith The Parliamentary Secretary, Cabinet Office

On that point, the hon. Member for Glasgow North East will note that an amendment tabled by hon. Member for Wolverhampton North East states that the Prime Minister would lay the order. She therefore must be fearful of such a scenario.

Photo of Emma Reynolds Emma Reynolds Shadow Minister (Foreign and Commonwealth Affairs)

I welcome the hon. Lady’s useful contribution. That proposal is in the second group of amendments, but I am happy to debate it with her. It is possible that the next Government will be a coalition. That might be Labour and the Liberal Democrats, the Tories and the Liberal Democrats, or, as I am sure the hon. Member for Cheltenham would prefer, a Liberal Democrat majority Government. It is more likely, however, that there would be a coalition of one sort or another.

As the hon. Lady points out, I want to provide clarity: we do not know which Secretary of State the Bill is referring to, so the amendment would require the Prime Minister to lay the order. If the Bill is not amended and the order is not laid by the Prime Minister, and given that we are talking about what Government might be in office between 2015 and 2020, my hon. Friend the Member for Glasgow North East is right to suggest that, while the Deputy Prime Minister does not hold the Foreign Office portfolio in this Government, under the next Government the Liberal Democrats might choose it.

The implication of the Bill’s drafting—perhaps the hon. Member for Stockton South will provide clarification—is that laying the order would be for the Foreign Secretary, although that is by no means clear, and that Foreign Secretary might be a Liberal Democrat, not a Conservative. Those scenarios are possible and worth considering.

I would prefer amendments 4, 5, 6, 7, 8, 9, 10, 11 and 12 not to be accepted and my amendment to be accepted. We have been talking about all the possible dates, but they, like the Bill, represent arbitrary deadlines, not a realistic timetable in which there will be either treaty change or a significant renegotiation of our membership of the European Union. Nor do I think that, within that period, there will be any significant change in our relationship with the European Union. The dynamic between eurozone and non-eurozone will take some years to become clear, so I suggest that we do not specify the deadline of 31 December 2017.

It is up to those who support that deadline to explain the rationale for it; I am sorry to say that the way it was presented in January made it seem politically motivated. The Prime Minister said that that date was the mid-point of the next Parliament, but why is it important to timetable that date? If any Conservative Member wanted to offer clarification, I would welcome that.

It is not clear to me why such a date should be timetabled. It does not tally with any constitutional change that is happening in Europe, nor does it tally  with any change in our relationship or change of the sort that I discussed in relation to the eurozone and non-eurozone dynamic.

The other amendments in the group concern the establishment of a Royal commission to determine the timing and the arrangements for a referendum. The debate has unfortunately become highly politicised. If we set up a Royal commission that was dispassionate, objective and very rationale in approach it would take the politics out of this question. Amendment 13 deserves to be considered in great detail. It would be interesting to hear the view of the hon. Member for Stockton South on this. Under amendment 13 the Royal commission would report to the Secretary of State within 24 months of its establishment. So we are talking about an early time frame. If we enacted this sooner, rather than later, that would be just after the next general election. That seems like a fairly good time frame to me.

Photo of William Bain William Bain Shadow Minister (Scotland) 10:30, 17 July 2013

The amendment is interesting. It would be one way of having some sort of parliamentary investigation and a way perhaps of dragging out of the Europe Minister, who is unusually taciturn today, the implications of a yes vote or a no vote to the question in subsection (4). At least that would provide Members and the public with some means of having an investigation into the consequences if the Government are unwilling to provide the Committee with that information this evening.

Emma Reynolds rose—

Photo of Joe Benton Joe Benton Labour, Bootle

Order. Before the hon. Lady responds, I am taking the opportunity to suspend the sitting. Members need a break. The Committee will reconvene at 11.30 pm and the hon. Lady can respond then.

Photo of Martin Horwood Martin Horwood Liberal Democrat, Cheltenham

On a point of order, Mr Benton, it is rather odd that we are sitting later and later into the night. I warned my family that I might not be home tonight but it seems thoughtless and inconsiderate to House staff to keep them sitting later and later into the wee small hours. Is it not possible for you to put to the hon. Member for Stockton South that it might be approaching the time when the decent and sociable thing would be to move the adjournment for the day?

Photo of Joe Benton Joe Benton Labour, Bootle

I thought I had adequately explained this earlier on in our proceedings. We are discussing 25 amendments. Some of them have not been touched yet. I am determined that the amendments and the contents of the Bill are fully discussed.

Photo of Joe Benton Joe Benton Labour, Bootle

The matter is not in my hands. We have been sitting here for eight or nine hours now and we are getting other Chairmen lined for during the night as well. Members need a break. I declare the sitting suspended until 11.30 pm.

Sitting suspended.

On resuming—

[Jim Sheridanin the Chair]

Photo of Joe Benton Joe Benton Labour, Bootle

It would be extremely helpful if the shadow Minister could indicate when she will bring her remarks to a conclusion.

Photo of Emma Reynolds Emma Reynolds Shadow Minister (Foreign and Commonwealth Affairs)

It is a great pleasure to serve under your chairmanship, Mr Sheridan. I will speak briefly to the lead amendment in this group, amendment 30, and I will say a little about the timetable that we have been considering. I will also talk briefly about the constitutionality of binding the next Parliament.

Amendment 30 would change the wording of the part of the Bill that refers to holding a referendum to make it discretionary, rather than compulsory. It is important that in this Parliament we do not attempt to bind the next Parliament. My other amendments would ensure that we do not have an arbitrary timetable with 31 December 2017 as a deadline. I discussed in some detail a little earlier other deadlines that could be considered.

Photo of Joe Benton Joe Benton Labour, Bootle

Could you give us an indication of how long you intend to speak? I note that you are saying briefly, but is briefly five minutes or two hours?

Photo of Emma Reynolds Emma Reynolds Shadow Minister (Foreign and Commonwealth Affairs)

Briefly is probably three minutes.

The arbitrary timetable is a concern. The Minister for Europe’s comments about why we have the date of 31 December 2017 would we welcome. Finally, I think that there are still discussions to be had about the formulation and the wording of the question. I must impress that on the Committee. I would really like the Electoral Commission to come in and talk to us either as a Bill Committee or individually so that we can be better informed about the best formulation of words for the question.

Photo of David Lidington David Lidington The Minister for Europe

I, too, am delighted to welcome you to the Chair, Mr Sheridan, for the first time in these proceedings. I congratulate my hon. Friend the Member for Stockton South on his success in introducing this Bill. I want to address, I hope reasonably briefly, the various amendments that the hon. Member for Wolverhampton North East and my hon. Friend the Member for Cheltenham have tabled in this particular group. It might be helpful if I divide up my comments according to the theme of particular amendments.

Amendment 31 and new schedule 1, tabled by the hon. Member for Wolverhampton North East, seek to import into the Bill section 4 of the European Union Act 2011. In effect, it is very similar to a cut and paste job by which the hon. Lady seeks to introduce into the European Union (Referendum) Bill the tests laid out in section 4 of the European Union Act to determine when a referendum is required in the case of a treaty change, a new treaty or an article 48(6) decision, which, as the Committee knows, is the simplified provision procedure provided for under the Lisbon treaty.

I am delighted by the zeal that the hon. Member for Wolverhampton North East now demonstrates towards the European Union Act. It is a well-known biblical proverb that there is more joy in heaven over one sinner  that repenteth. I just wish that that enthusiasm had been demonstrated earlier, when we were taking that coalition legislation through the House and when, as my hon. Friend the Member for Cheltenham rightly reminded us, he and his Liberal Democrat colleagues joined the collective Government effort to pass that historic statute.

Photo of Emma Reynolds Emma Reynolds Shadow Minister (Foreign and Commonwealth Affairs)

I remind the Minister, who in his characteristic energetic and demonstrative way seems to be suggesting that my party and I did not support the European referendum Act, that we did not vote against it in the later stages of the Bill. Our opposition on Second Reading was about concerns involving judicial review.

Photo of David Lidington David Lidington The Minister for Europe

The hon. Lady has just reminded us that she did oppose the Bill on Second Reading. To characterise her endorsement of that legislation as lukewarm would be something of an exaggeration, as that was certainly not how the Labour party presented its case at that time.

Photo of Martin Horwood Martin Horwood Liberal Democrat, Cheltenham

The Minister is bringing new energy to the debate. On the subject of consistency, Ministers in glass houses probably should not throw stones. He may remember his reply to the hon. Member for Rochester and Strood (Mark Reckless) soon after the passage of the European Union Act 2011, when he said:

“It will come as no surprise to my hon. Friend the Member for Rochester and Strood to know that I disagree with him about the need for an in/out referendum.”—[Official Report, 16 March 2011; Vol. 525, c. 245.]

Maybe the Minister will explain what has changed in the intervening time.

Photo of David Lidington David Lidington The Minister for Europe

We dealt with this on Second Reading, for which I think my hon. Friend was present, but I will come to that point later.

One of the flaws in the hon. Lady’s amendment is that although it seeks to import section 4 of the 2011 Act into the Bill, it is silent on section 6 of the 2011 Act, which lists a whole set of further important European Union decisions that are now subject to the referendum lock. I could list them all—I would probably test the Committee’s patience and yours, Mr Sheridan, were I to do so—but I will single out one example. Section 6 of the European Union Act 2011 would require a referendum were any future British Government to seek to join the euro.

I therefore confess to being slightly suspicious about the fact that the hon. Lady on the Labour Front Bench has chosen to exclude such a requirement from the amendment and new schedule that we are debating. I wonder whether it is the first hint that we have received since the passage of that legislation that the Labour party is reverting to type about joining the euro. The Leader of the Opposition said, when asked whether Britain would join the euro:

“It depends how long I’m Prime Minister for.”

That idea is once again beginning to animate the Labour party’s thinking. It suggests to me that at the back of the Opposition’s mind, there is once more the idea that they can find a way to get this country into the euro without putting it to the test of a public vote.

Photo of Emma Reynolds Emma Reynolds Shadow Minister (Foreign and Commonwealth Affairs)

The Minister tempts me to respond and to get on the record the fact that, like the Conservative party and the Liberal Democrats, the Labour party is against this country joining the euro. When in government, we did not take the country into the euro. We said then that a referendum would be held. We did not need to put that into law; we made a pledge; and we would have carried it out if we had decided to join the euro, but we did not do that at the time.

Photo of David Lidington David Lidington The Minister for Europe

It took until this Government came to office to close down the euro preparation unit that stayed in government until the last days of the previous Administration.

Amendments 38 and 14 deal with the role of the Electoral Commission in advising on the question to pose in the referendum. That is a perfectly serious point to make, and these are probing amendments. I remind the Committee that the established practice under the Political Parties, Elections and Referendums Act 2000, which was enacted under a Labour Government, is that the Electoral Commission should begin to consider the question to pose after the Bill to authorise a referendum has been given its Second Reading. That work has now started. The chair of the Election Commission in a letter of 9 July to my hon. Friend the Member for Stockton South said:

“Now that the EU (referendum) Bill has received its second reading, I wanted to highlight that we have begun this work.”

She says later in her letter:

“In terms of timing, we are confident that our report” on the referendum question

“will ready by October and well in advance of the earliest point that the EU (referendum) Bill could be ready to return to the House of Commons for its Report stage on 8 November.”

So the practice that is being followed with the Bill and the Electoral Commision’s role in commenting on the question is exactly the same as that which has been followed on other referendums since Royal Assent was given to the Political Parties, Elections and Referendums Act 2000. Amendments 38 and 14 are therefore simply unnecessary.

Other amendments pose various permutations for the date of a referendum. Some amendments propose that no deadline should be set. Some amendments propose an earlier date than the end of 2017; others propose a later date than 2017. The 2020 general election is cited in one amendment. The difficulty is that to set no deadline at all would leave us with a serious problem of public trust. The brutal reality in this country at the moment is that there is relatively little public trust in the word of all politicians of all parties. A simple promise that at some as yet unspecified date in the future a referendum might be held if the then Government were to get around to it will not be sufficient to assure the public that we are serious and that we have confidence in being able to settle the question definitively in a public vote.

The problem with setting an earlier date than 2017 is that, in practice, we would vote on a choice between the status quo in the EU and leaving, whereas my right hon. Friend the Prime Minister made it clear in his Bloomberg speech in January that he is seeking EU reforms, some of which can be achieved without treaty change and some of which, he believes, would require treaty change during the next few years. He has made it clear that his  wish is to be able to campaign heart and soul for continued membership of a reformed European Union. We will not know in the next few months—or even next year, I suspect—exactly how the work that our eurozone colleagues are undertaking to stabilise their currency union will affect the EU’s political and institutional structure.

The later date—the 2020 general election—carries the same disadvantages for public trust as setting no date at all. In one sense, the critics are right in that there is no magic to saying that we should have a decision by the end of 2017, but there is a pretty strong case for setting that deadline. For a start, setting a clear deadline of halfway through the next Parliament will command public trust and confidence and show that we are serious.

Secondly, setting a deadline will impose discipline on the negotiations, on the part of the UK Government and that of our European partners, who will know that, by that time, a British decision will have to be made.

Thirdly, a deadline of the end of 2017 fits very well with the European timetable. I do not think that anybody seriously believes that the European treaties are likely to be open to revision this side of European parliamentary elections next spring and the subsequent appointment of the new European Commission. Similarly, there will be a French presidential election in the late spring and a German federal election in the autumn of 2017. That probably means that there cannot be serious negotiations about treaty change during that year, so the window of opportunity for Europe as a whole is from the latter part of 2014, through 2015 and 2016, leaving the two years up to the 2019 European parliamentary elections and the end of the Commission’s term for national ratifications. There is therefore a strong argument on European terms for the timetable in the Bill.

My hon. Friend the Member for Cheltenham asked what has changed, and I promised to give him a response. In the past two years, Europe has changed. When I look back to the autumn of 2011, I recall a crisis summit in Cannes with the then Prime Minister of Greece being effectively called in by the leaders of France, Germany and the Commission; open speculation, including from eurozone leaders, about whether their full membership could survive, and speculation in the media about whether the eurozone would fragment.

For us to have said at that point that we would go for a referendum would have had two adverse consequences. First, we would have posed a choice without any conception of where Europe was likely to end up in a relatively short time. Secondly, at that moment of existential crisis for our friends and partners in the eurozone, coming forward with a referendum proposal would have harmed our chances of securing the serious reforms to the EU, whether in a treaty or without the need for treaty change, that we wanted.

Amendment 30 would make holding a referendum discretionary rather than mandatory. To some extent, I have covered the arguments already. Much of the speech of the hon. Member for Wolverhampton North East on the group of the amendments was taken up with charges that the Government, in supporting the Bill, or my hon. Friend the Member for Stockton South, in promoting it, were creating uncertainty. Yet, in amendment 30, the  hon. Lady appears to have stumbled upon a way of maximising uncertainty by providing for a referendum but making it entirely discretionary, with no timetable and no duty on the Government to introduce the orders to settle the question once and for all.

The problem with the hon. Lady’s charge of creating uncertainty is that uncertainty already exists. The question mark over the UK’s membership of the EU is already there—it is a reality. Anybody who has looked at British opinion polls in the past couple of years can see that, in the Prime Minister’s words, “public consent” to our continued membership is wafer thin.

As someone who wants us to stay in a reformed EU, I believe that that is not a satisfactory state of affairs, but I also believe that the only way to settle the argument once and for all is to put the question to the British people for a final vote.

We have here a rag-bag of amendments. Some are probing and well-intended, some are ill thought through and some are, quite frankly, a substitute by the main Opposition party for a position on the Bill. It has been striking, on Second Reading and during today’s proceedings, how the hon. Member for Wolverhampton North East and her colleagues have tried as hard as possible to avoid saying whether they believe the British people should have a say. During the debates on the European Union Act 2011, I remember hearing exactly the same stuff from the Labour spokesmen and women about binding the hands of a future Parliament, because they could not make up their minds about what they actually wanted to do. I hope that, on reflection, the hon. Lady will decide to withdraw her amendments.

I should make it clear before I sit down that I have spoken this evening as a Conservative Minister and not on behalf of the coalition on as a whole. The two parties, which are committed to keeping the coalition going, have agreed to differ on the legislation. I believe that the amendments are fundamentally ill founded and that the Bill would be better off without them.

Photo of William Bain William Bain Shadow Minister (Scotland) 11:45, 17 July 2013

It is a pleasure to serve under your chairmanship again, Mr Sheridan, and it is always a pleasure to follow the Minister. He gave an informed and entertaining performance, which was well worth waiting for, a mere 10 hours into the debate. I admired his saying that the reason for the 2017 deadline was the complete collapse of public trust in politicians. The reality is that the reason why we are discussing the Bill is the complete collapse of trust in the Prime Minister among his own Back Benchers.

We need to consider the amendments tabled by my hon. Friend the Member for Wolverhampton North East because it is not clear that under clause 1, the United Kingdom would continue to have access to the single market following a no vote. Even the Minister has said little about the consequences of clause 1 in its present form, but they will be critical for people and for businesses. Access to and influence in the single market, which can be guaranteed only by our continuing membership of the European Union, boosts our economy by £3,300 per household per year, and eight in 10 of our key export markets are inside the EU.

I am disappointed that neither the hon. Member for Stockton South nor the Minister have clarified the effect of a no vote to the referendum question in clause 1(4)  on our membership of and ability to shape the single market. Enlargement has more than doubled UK trade to the 12 member states that acceded to the EU between 2004 and 2007. By negotiating as part of the world’s largest single market area, the UK can achieve a far better deal than it might do as a single negotiating state. I hope that, in our future considerations, perhaps on this group of amendments, both the hon. Member for Stockton South and the Minister will explain their position on that matter. I appreciate that the Minister says he speaks as a Minister, but it is highly unusual for a Minister to speak as a Minister but not on behalf of the collective position of the Government, so it would be sensible for him to tell us the Government’s position on what the implications of this clause actually are.

As my hon. Friend the Member for Wolverhampton North East points out, the Bill is currently drafted and predicated on an arbitrary referendum timetable that leaves inward investors with four years of uncertainty on whether the UK will remain within the EU, be part of the single market or be part of a customs union shared with the EU, or indeed none of those options. The Prime Minister cannot tell us which elements of the UK’s current terms of membership he wishes to renegotiate. I know he made a brief appearance to observe the Committee’s proceedings earlier, but we have not heard any statements in the House from him on what people would actually be asked to vote on if the clause is passed in its current form and if the question that the hon. Member for Stockton South has put before the Committee becomes the referendum question.

It is also entirely uncertain whether any of the aims of renegotiation are actually achievable. The renegotiations depend on the unanimous approval of the 27 other member states. Many of the possible areas that the Conservative party might wish to see repatriated to member states, such as policy on health and safety, employment rights or potentially ending the European Court of Justice’s jurisdiction in national legal systems, may cause distortions within the single market and would meet concerted opposition from our partners.

Is it the argument of the hon. Gentleman and the Minister that they wish to repatriate competences on workplace safety and maternity rights in order to improve them here in the United Kingdom? Or is it that they wish further to impose the Beecroft agenda, which is motivated by the impulse that decent rights at work are the enemy of economic growth? If that is the ambition, why conclude it by a timetable of 2017? In the debate on these amendments, we have heard the contrast between the process on which the hon. Member for Stockton South is engaged in this Committee and the process undertaken by the Labour Government in 1974 and 1975, when they negotiated the UK’s conditions of entry, before a referendum in 1975, within a five-month time scale. The negotiation was agreed by the other member states in March 1975, and it was followed by two further White Papers on the terms of the negotiation before the referendum Bill was published and presented to Parliament.

In summary, when Parliament was asked in 1975 to pass legislation required to establish a referendum, it was in the context of a White Paper produced by the Government that spelled out the full details of the implications of a no vote and the precise implications of what the electorate were being asked to vote for. As it  stands today, there is nothing in clause 1 that remotely matches the rigour and informed involvement of Parliament that occurred in that process in 1975.

This debate has been illuminated by the experience of referendums in other states and of the referendums that have occurred and will occur in this state. Mr Sheridan, you and I have the great privilege of representing Scottish constituencies, so we have a unique insight into the process that is leading up to the referendum on independence in September 2014.

On the referendum on Scotland’s future within the United Kingdom, the Government were right to point to the need for fully informed debate. They were right to say that voters and Members of this House needed the tools to scrutinise the implications of separation. It was interesting that in January 2012, the Government said that having an arbitrary date set four years hence for a referendum on independence held by the Scottish Government would cause excessive uncertainty for inward investment.

How, then, can the Government believe that it is right to have four years of uncertainty ahead of a referendum on the UK’s membership of the European Union? Unlike its Scottish counterpart, that referendum would have to be conducted on the basis of a pre-negotiated treaty to alter the conditions of membership, which the Prime Minister may not even be able to negotiate in the end. Where is the intellectual consistency between the arguments that the hon. Member for Stockton South made on Second Reading, those made by the Prime Minister in relation to Scotland, which were addressed in the Edinburgh agreement, and the Conservative party’s arguments for a referendum in the terms set out in clause 1?

There is no plan on the details of renegotiation, no logic in the timing and no assessment of the consequences. I put it to you, Mr Sheridan, that, in the long history of this House, there has never been a weaker basis for endorsing a matter of prime constitutional importance than the one on which the Committee is being asked to endorse clause 1. I hope that the Committee will consider with great diligence the amendments that my hon. Friend the Member for Wolverhampton North East so ably introduced and consider whether, in all conscience, it can allow the clause to stand part of the Bill unamended.

Photo of Martin Horwood Martin Horwood Liberal Democrat, Cheltenham 12:00, 17 July 2013

I probably speak for the whole Committee in thanking you, Mr Sheridan, for stepping into the breach at this very late hour. I hope I also speak for the whole Committee in saying thank you to the Commons staff, who have continued to support us this late into the evening. I thank those who are not even in this room, such as the Hansard reporters—[Interruption.] Yes, and the Foreign and Commonwealth Office staff, and those such as Noleen and her team in the Tea Room, who are prepared to keep supporting us. Politicians are used to shenanigans such as this, but sometimes we forget that other people have slightly more normal expectations of family life, home, bed and so on.

There are quite a lot of amendments in this group, but I will try to move through them as swiftly as I can. Amendment 30 would simply make the referendum discretionary rather than mandatory. Like the Minister  for Europe, I am not convinced about that, because it would seem to remove the essence of the Bill, which is to mandate a referendum. It is already possible for a Government to hold a referendum if they so choose, and I understand that the legal advice is that in any case, a more substantive vote would be needed to call a referendum. If we simply changed the words “is to be held” to “may be held”, we would simply be stating the bleedin’ obvious, if that is parliamentary language. I am not particularly persuaded by the arguments of the hon. Member for Wolverhampton North East in favour of that amendment.

The hon. Lady may be technically right that one Parliament cannot really bind its successors, and another Parliament always has the liberty to reverse what has been decided before, but it has not stopped us trying in the past. Examples under the Labour Government include the Climate Change Act 2008, which set targets all the way to 2050 in an attempt to bind many future Parliaments on energy and carbon emissions policies for decades ahead. I am not therefore not persuaded by amendment 30.

Amendment 31 and new schedule 1 would insert transfer of power arrangements in the Bill. I have some sympathy with the hon. Lady on that. If she missed out referendum triggers relating to the euro, I suspect that that was simply because of the haste with which we all had to table amendments. The debate on the programme motion rather explained some of the problems with the timing of the Bill, so we probably should not repeat those points.

As the Minister spotted, the list that would be inserted by new schedule 1 originated in the European Union Act 2011. In fact, the concept originates in Conservative party policy as it was for at least a couple of years after the cast-iron guarantee of a referendum on the Lisbon treaty and prior to the policy that has now emerged. There is a slight suspicion that the trigger was designed never to be pulled and that the various conditions were expected to discourage any kind of treaty change along such lines, so a referendum would therefore never be held. At the time, the Minister warned against any kind of deviation from that approach, so it is interesting to hear him argue against the inclusion of those conditions in a referendum trigger.

In practice, the trigger for a referendum is quite light. The hon. Member for Wolverhampton North East made a good point about there being some changes of minor constitutional significance that would nevertheless trigger a referendum. Had there been time, we might have considered the list carefully and in more detail.

Amendment 33, along with amendment 2, to which I have now put my name, although it was originally tabled by the hon. Member for Ilford South (Mike Gapes), would remove the specific date of 31 December 2017. I heard the Minister’s attempt to justify that date, but I am afraid that it did not hold water for me. I did a quick sweep of the web to try to find out the significance of the date, and found some interesting anniversaries. On 31 December 406 AD, the Vandals, Alans and Suebians crossed the Rhine and invaded Gaul, presumably in an early attempt at European unification. In 1229, James I of Aragon completed the reconquista of Majorca, thereby ensuring that generations of British holidaymakers would have to learn the Spanish word for beer, rather than the Arabic, I guess. In 1923, the chimes of Big Ben  were broadcast for the first time on 31 December. In 1941, Alex Ferguson was born—perhaps that is the anniversary with massive significance.

The date that has been chosen is arbitrary and something of a political ruse. Its significance relates, of course, to the general election. It is far enough away for the Conservatives to promise jam tomorrow, so that they can maintain unity to the general election campaign and beyond, but not so far away that it makes the Eurosceptic wing of the party too unhappy.

In practice, the date is unrealistic because we have no idea what the precise situation will be in 2017. The Minister’s confidence that the fundamental problems in the eurozone relating to debt and competitiveness—there are still trillions of debt in the eurozone—will have been resolved is somewhat misplaced. We might still be in the throes of discussions about the future of the eurozone. There might be consequential discussions about whether treaty change is required to guarantee financial stability in Europe. There might still be discussions, either side of a German or a French election, about exactly how the European Union is to move forward collectively. Indeed, even considering the terms set out by the Conservatives for the suggested renegotiation, there is no guarantee that that process will be in any sense complete—especially if it is embarked on only after the general election—and it might have run into difficulty. The idea that anything at European Union level can be completed on such a fixed time scale runs against all the Minister’s experience on other European issues.

On the ambition for renegotiation, we may refer to the Prime Minister’s speech of 23 January 2013, which set out his great vision for Europe. He referred to five fundamental principles: competitiveness, flexibility, democratic accountability, fairness and the fact that there must be the ability for power to flow back to members states, not just away from them. None of those is something to which any reasonable person could object, and when one delves into the detail of the speech there are very few concrete suggestions for reform that anyone could object to—certainly no one in the Liberal Democrats could—and they do not dictate any particular timetable, most importantly, of course, because most could be achieved without the threat of a referendum at all. They could perfectly well be achieved through multilateral action, negotiation and working with likeminded allies across Europe. I hope that that process is already under way under the coalition Government.

Amendments 28 and 29 relate to a royal commission, amendment 34 would delete the date of the Secretary of State’s order, and amendment 37 would ensure that the question in clause 1 was the only question in the referendum. They are all rather crude attempts at provoking further debate and possibly delaying the process of the Bill. Obviously, I would not countenance that. In particular, the idea that setting up a royal commission would be acceptable to the public does not hold much water; it is fairly obviously a delaying tactic and an attempt to kick the Bill into the long grass.

Amendments 38 and 14 are variations on the words “be”, “remain”, “should remain” and so on in the question. I suppose that we should listen to the Electoral Commission on that issue, which should not be a matter for party political debate. As other hon. Members have  said, it should be a matter, wherever possible, of cross-party consensus and we should try to avoid the unedifying example of the arguments over the Scottish referendum question.

At some stage, perhaps later, we need to consider whether we can amend the Bill to align it with the 2000 Act. I have no strong views on whether “be”, “remain”, “should be” or “should remain” is the best wording, but it is important to have a fair process to determine the question because, as we discussed in the context of Quebec, sometimes referendums are decided by minute percentages, and who knows the psychological impact of a particular form of words? Whether it is a yes or a no, in whichever direction, there can be an impact on such questions.

I will draw my remarks to a close at that point. [Hon. Members: “More!”] I am astonished at the outpouring of support from Conservative members of the Committee, and grateful for it. This first sitting has been extraordinary, in that normally eloquent Members, such as the hon. Members for Bournemouth East, for Cannock Chase and for Stockton South, who was very eloquent on Second Reading, have sat in silence and not responded to any debate on a Bill that they support, which is extraordinary. I have never encountered that in a Public Bill Committee, so we are clearly dealing with a rather strange animal.

Photo of Emma Reynolds Emma Reynolds Shadow Minister (Foreign and Commonwealth Affairs)

Amendment 30, like the other amendments standing in my name, is probing and I do not wish to press it to the vote.

I beg to ask leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Photo of Emma Reynolds Emma Reynolds Shadow Minister (Foreign and Commonwealth Affairs)

I beg to move amendment 35, in clause 1, page 1, line 5, leave out “Secretary of State” and insert “Prime Minister”.

Clause 1(3) says:

“The Secretary of State shall by order, and before 31 December 2016, appoint the day on which the referendum is to be held.”

I suggest to the hon. Member for Stockton South that it is ambiguous as to which Secretary of State is being referring to—deliberately ambiguous perhaps, although I do not know. The rationale for my tabling the amendment was that it would be helpful either to replace “Secretary of State” with “Prime Minister”, or to be more specific about which Secretary of State. It could be the Foreign Secretary

Photo of Joe Benton Joe Benton Labour, Bootle

Order. I am conscious of the fact that conversations are going on in the Public Gallery. They are interfering with the work of Hansard, so please have any private conversations outside the room and please do not interfere with members of the Committee.

Hon. Members:

Hear, hear!

Photo of Emma Reynolds Emma Reynolds Shadow Minister (Foreign and Commonwealth Affairs) 12:15, 17 July 2013

Thank you for that, Mr Sheridan.

Instead of “Secretary of State”, there is a logical reason for stating “Foreign Secretary” because European policy is, after all, their responsibility, or—I do not  know whether this is what the hon. Member for Stockton South had in mind—the Bill could specify the Deputy Prime Minister, who at least in this Government, although perhaps not in the next, is responsible for political and constitutional reform. Perhaps the Secretary of State for Justice, under the Political Parties, Elections and Referendums Act 2000, deals with referendums as part of his brief.

I urge the hon. Member for Stockton South to reflect on whether he wants to make the Bill more specific and, therefore, more meaningful. He could accept my amendment and specify the Prime Minister, or introduce his own to deal with the ambiguity.

Photo of Chloe Smith Chloe Smith The Parliamentary Secretary, Cabinet Office

It is a pleasure to play my part in proceedings and to serve under your chairmanship, Mr Sheridan, at this late but none the less enjoyable hour.

It falls to me to make an extremely brief comment. The amendment tabled by the hon. Member for Wolverhampton North East is unnecessary, because we  use “Secretary of State” in legislation to refer to any Secretary of State. The effect she seeks is already achievable through current conventions on such language. I am, of course, bowled over that she wants to specify the Prime Minister, and I am sure that she particularly intends the current Prime Minister to have that pleasure.

Photo of Emma Reynolds Emma Reynolds Shadow Minister (Foreign and Commonwealth Affairs)

The amendment is probing—an attempt to set down something that the hon. Member for Stockton South might want to return to. I hear what the Minister says, and I am grateful that she is here at this late hour to state her position on that line in the Bill. I beg to ask leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Ordered, That further consideration be now adjourned. —(James Wharton.)

Adjourned till Tuesday 3 September at Two o’clock.