European Community (Budget)

HC Deb 04 February 1992 vol 203 cc230-56

Mr. Speaker

I have selected the amendment in the name of the hon. Member for Thanet, South (Mr. Aitken).

10.16 pm

The Financial Secretary to the Treasury (Mr. Francis Maude)

I beg to move, That a further supplementary sum not exceeding £450,000,000 be granted to Her Majesty out of the Consolidated Fund to defray the charges for civil services which will come in course of payment during the year ending on 31st March 1992, as set out in House of Commons Paper No. 182 of Session 1991–92.

Mr. Tony Marlow (Northampton, North)

On a point of order, Mr. Speaker. This is a very important matter, involving a great deal of money. I understand that at the moment our net contribution is of the order of £2,800 million in a year. The motion seeks to increase our contribution by £450 milion on the basis of a vote by the European Parliament the legality of which is disputed.

My hon. Friend the Financial Secretary will speak for the Government. We are grateful to him and are impressed by his ability, but my point of order to you, Mr. Speaker, is that perhaps at this time a Law Officer of the Crown should be present to explain the highly intricate legal aspects of this important issue, because a great deal of money is involved. I think that it would be for the benefit of the House if a Law Officer were present.

Mr. Speaker

What has been said will have been heard by the Deputy Chief Whip, who is on the Front Bench. We must now proceed with the debate.

Mr. Maude

As my hon. Friend the Member for Northampton, North (Mr. Marlow) has just pointed out in his point of order, the supplementary estimate which is before the House relates to our contributions to the 1992 budget of the European Communities.

The estimate is needed because the European Parliament's recent adoption of the budget is open to legal question. The Council is considering its legal position, but, because of the legal uncertainties, the Government cannot at the moment treat the 1992 budget as agreed between the institutions. Therefore, for the time being, we must approach the 1992 budget and our contributions to it on the basis that the budget has not been adopted.

When a budget has not been adopted, monthly contributions are calculated on the basis of one twelfth of the last adopted budget, in this case the 1991 budget. The European Communities Act 1972 gives authority to contribute on this basis, without further parliamentary approval. The Government are therefore seeking parliamentary approval for this estimate to cover contributions in excess of those due, had a budget for 1992 not been adopted.

The procedure we have followed in presenting this estimate reflects comments by the Treasury and Civil Service Committee in a similar situation in the early 1980s. The Committee's second report in the 1981–82 Session expressed the view that the Government should refuse payment of any disputed sums unless the matter had been debated and decided by Parliament. On two subsequent occasions, in January 1985 and 1986, when we again needed estimates provision for part of our contribution, it was possible to provide the opportunity for debate before the first payment fell due, but the circumstances and timing in the present case prevented us from doing so again. Nevertheless, we are presenting the estimate as early as we can and well in advance of the normal spring round of estimates to provide the House with an early opportunity to debate the issue.

Mr. Chris Smith (Islington, South and Finsbury)

I am grateful to the Financial Secretary for giving way, especially so early in his remarks. For the sake of clarity, will he confirm that the disputed amount between the Parliament's budget and the Council of Ministers budget relates to £12 million of expenditure by the United Kingdom, not £450 million?

Mr. Maude

The hon. Gentleman is correct. The monthly amount that the estimate seeks authority from the House to contribute to the 1992 budget is only £1 million per month—that is the disputed amount.

In the light of its legal advice, the Council will take a view on the basis for action in the European Court. Subject to that advice, the Government will urge the Council to bring a case against the Parliament. The Commission will implement the 1992 budget adopted by the European Parliament pending the Court's judgment, which we hope will soon be available.

Mr. Marlow

I am afraid that my mind moves slowly at this time of the evening—

Mr. Hugh Dykes (Harrow, East)

We understand that.

Mr. Marlow

I thank my hon. Friend for his comments.

As I understand it, we are being asked to vote an extra £450 million for an eventuality that may not arise, subject to a legal decision within European institutions—am I right or wrong? If I am right, why must we make a decision tonight on whether we are likely to approve the sum of £450 million? How does that sum relate to the £12 million or £1 million per month, which my hon. Friend has just agreed with the hon. Member for Islington, South and Finsbury (Mr. Smith)?

Mr. Maude

For reasons that we have previously debated in the House, the British contribution to the EC budget last year was abnormally and atypically low—about £1.2 billion. The underlying level of contribution is about £2 billion a year, so even if the budget had been as accepted by the Council of Ministers, a large sum in addition to last year's contribution would have been payable by the United Kingdom Government. Therefore, the amount in dispute, as has been said, is no more than £12 million in terms of the United Kingdom's contribution to the budget.

Mr. Nicholas Budgen (Wolverhampton, South-West)

Will my hon. Friend explain what he means by the "underlying contribution" and the "atypical contribution", as it is difficult for us to understand?

Mr. Maude

That simply reflects an average taken over the years. For a variety of reasons, last year's abatement was substantially larger than that of the year before and that for this coming year.

Mr. Budgen

Why should we regard the average as the underlying figure? As I understand it, there is an heroic new role for the EC. More especially, we are hoping—as I imagine the House is, as it is in favour of the gradual move towards a common currency—a vast expansion of the regional fund. Why should we expect that the average should be the underlying figure? If we wish to be at the heart of Europe, we must expect a vast increase in our contribution to that heroic enterprise.

Mr. Maude

We expect no such thing. We do not base our contribution for the coming year simply on the extrapolation and average of previous levels, but on the calculation, already available, of what the contribution will be in the coming year. Although my hon. Friend may prefer to think of it as such, it is not simply a shot in the dark.

Sir Teddy Taylor (Southend, East)

What is my hon. Friend's latest estimate of our net contribution in 1992, assuming its legality? Does he agree with the famous Treasury and Civil Service Select Committee report, which stated in paragraph 12: If this situation"— which the Committee thought was unsatisfactory and unprecedented— arose again, the Government should refuse payment"?

Mr. Maude

My hon. Friend is right to refer to that report, which stated that, if a payment were to be made, this was the procedure that we should observe. This is not a new departure. The same procedure was used on occasions in the past, apart from those to which the report referred—such as in 1985 and 1986, when comparable circumstances arose.

Mr. Roger Moate (Faversham)

We are asked to approve a vote of £450 million. The "Supply Estimates 1991–92 Class XX Net Contributions to European Community Institutions" baldly presents a figure of £450 million. The only explanation offered is: Payments … resulting from the adoption by the European Parliament of a larger Budget for 1992 than that permitted by Community legislation. We are now told that the figure amounts to approximately £1 million a month, or £12 million a year.

The motion asks for a sum of £450 million. Is the information I quoted all that the House is entitled to have, coupled with my hon. Friend's explanation—which was not at all clear? Are we talking about £12 million or £450 million? Will my hon. Friend the Financial Secretary explain why we are asked to authorise a payment of £450 million?

Mr. Maude

That sum represents the difference between our contribution last year on the basis of the 1991 budget and our contribution this year on the basis of the agreed 1992 budget. Even if the budget agreed by the Council of Ministers had been adopted, it was only slightly smaller than that adopted by the European Parliament. The bulk of the £450 million to which the estimate refers is attributable to not just the purportedly illegal portion on which the European parliament voted but the operation of the United Kingdom's abatement this year, compared with last year.

Mr. Tony Favell (Stockport)

A number of us are rather simple when it comes to such matters, as my hon. Friend the Financial Secretary knows. Is the sum of £450 million the total increase over last year in spending for the 12 months on which we are now embarking? Is it an extra £450 million for the whole of the year, or will there be more on top of that?

Mr. Maude

No. The United Kingdom's contribution this year, as we made clear in the budget debate before Christmas, is likely to be in the region of £2.5 billion. That compares with a contribution last year in the region of £1.2 billion. Last year's contribution was abnormally low, and compared with a contribution in 1990 of close to £3 billion—which was abnormally high.

This year's contribution not only reflects an average but is, as it happens, close to the underlying average level of contribution over the years.

Mr. Budgen

My hon. Friend has performed according to the highest traditions of his old professions at the Bar, by obscuring in a very difficult case. I refer him to page 8 of the "Supply Estimates". Does he agree with the description of the payments concerned as Payments to the European Communities resulting from the adoption by the European Parliament of a larger Budget for 1992 than that permitted by Community legislation"? If he agrees that we are giving authority to an illegal budget—a vast overspend—does he not also agree that that is somewhat unwise?

In the bad old days, when we were trying to achieve a balanced budget—and when our previous leader was trying to get back "her money", as she was vulgar enough to call it—we were quite keen to reduce Community expenditure. If, late at night, we agree to illegal overspending by the EEC, will we not seriously undermine the Treasury's endeavours to prevent the same from happening in the future?

My hon. Friend has been defending the Government's position in rather the same way as a highly intelligent barrister defending a very crooked fraudster. Let me sum up my two points. First, does he agree with the description given on page 8? Secondly, does he agree that it would be extremely stupid to take such action if we are to try to reduce Community expenditure in the future?

Mr. Maude

It is always a pleasure to listen to my hon. Friend when he is trying to be helpful. His intervention is much appreciated.

I concede that the passage on page 8 could have been more happily phrased; but it is wrong to interpret it as meaning that the whole £450 million flows from the disputed element of the budget.

Mr. Budgen

What words would the Financial Secretary use?

Mr. Maude

My hon. Friend has invited me to redraft the passage while I am on my feet making a speech. I shall certainly have a look at it.

My hon. Friend has asked me to contemplate a further point, and I am very ready to do that, too. He suggests that the wording undermines the Treasury's endeavours to contain Community spending. I do not believe that it does. I should point out that this is not just a United Kingdom concern; the entire Council is unanimous, and, if the case is sustainable, we shall seek to challenge the budget in the European Court of Justice. That is the right course to adopt.

We no more undermine our desire to contain Community spending—which, I should tell my hon. Friend, is as intense now as it has ever been—by adopting the measures that I invite the House to adopt tonight than we did in 1985 and 1986, in comparable circumstances. In both those years, the Government invited the House to agree a supplementary estimate in very much the same terms.

Mr. Budgen

But not for an illegal budget.

Mr. Maude

The budget was in dispute, and was not capable of being treated as having been agreed between the institutions in the way to which the European Communities Act refers. On that occasion, the Government invited the House to accept the course that is being suggested tonight.

Mr. Marlow

I am grateful to my hon. Friend for giving way: he is being extremely courteous this evening.

A couple of minutes ago, my hon. Friend said that the level of our net contribution to the Community last year—cash out of pocket per citizen—was about £25. This year, he says, it will be an extra £25. In other words, every family of four in my constituency will be asked to provide the European Community with a free handout of an extra hundred quid. What will they get for that extra hundred quid—and what do I tell them when they come to me and say, "Look, Mr. Marlow, we read our newspapers and find that European money in Italy is being fraudulently misapplied, it is ending up in the pockets of the Mafia, and you are asking us for another hundred quid, with all the other bills that we have to pay"? What does my hon. Friend think I should tell my constituents?

Mr. Maude

I am confident that my hon. Friend is resourceful enough to think of an adequate reply without my assistance.

My right hon. Friend the Member for Finchley (Mrs. Thatcher) negotiated in 1984 an abatement that is permanently in existence in Community law and can be changed only by unanimity. We have no intention of allowing it to be changed. Over the years, that has saved the British taxpayer large amounts of money that would otherwise have gone to the European Community budget in the form of an ever greater net contribution. The existence of the Fontainebleau abatements means that the amount that we contribute net to the budget, while still substantially larger than is acceptable to the House, is a good deal smaller than it would otherwise have been.

Mr. Dykes

I am grateful to my hon. Friend for giving way to someone who, unlike some previous speakers, has an objective view of these matters. My hon. Friend is a financial spokesman for a Government, who, for whatever reasons, have gone from an original expectation of no deficit or borrowing requirement to a huge deficit and a borrowing requirement of, probably, £25 million. That is a factor about which my colleagues who are against the Community have made no complaint and which they have accepted with equanimity.

Given that, could not the Financial Secretary defend the technical difficulties facing the Government with more robust energy? My hon. Friend does not have to apologise to anybody when he is talking about a mistake that represents 7 per cent. of the contingency reserve, which is an accidental aberration anyway.

Mr. Maude

I appreciate that my hon. Friend is seeking to be helpful. However, even when the British public finances were in substantial surplus, we remained equally concerned to ensure that the EC budget and our contribution to it were constrained.

Mr. Bob Cryer (Bradford, South)

The hon. Gentleman knows that the Government have continually expressed concern about expenditure being out of control in the Common Market. What sort of signal will this proposal send to the Common Market, which is still under heavy criticism for its excessive, not to say lavish, expenditure on, for example, the common agricultural policy? Will it not take this as a further signal that the Government are not concerned about scrutiny of financial expenditure?

Mr. Maude

I do not believe that it will send that signal. There is nothing revolutionary or new in the approach that the Government are advising the House to take. This has been done before, and we preserve the legal position. If the budget is being illegally adopted, the place for that to be set right is in the European Court of Justice. That is where the Council will take the case—

Several Hon. Members

rose—

Mr. Maude

I am conscious that, when we debated the budget before Christmas, I was criticised for taking up too much time with my opening speech. I do not want to be subject to the same criticism tonight, and I hope that the House will recognise that most of the time has not been taken up by me.

Mr. Budgen

My hon. Friend—

Mr. Ron Leighton (Newham, North-East)

On a point of order, Mr. Deputy Speaker. Are there not two sides in the House? Although this debate is vastly entertaining and instructive, is it merely an internal party or family affair—or can members of the Opposition also join in?

Mr. Deputy Speaker (Sir Paul Dean)

The Minister has already said that he does not want to take too much of the House's time in what is a fairly short debate. He has already been very generous in giving way.

Mr. Budgen

rose—

Mr. Frank Haynes (Ashfield)

Further to that point of order, Mr. Deputy Speaker. This is a very important point, and we want to pin it down. If we do not pin it down now, it will not be pinned down tonight.

Mr. Budgen

May I make a final attempt to pin the Minister down?

Mr. Deputy Speaker

Order. Is the Minister giving way?

Mr. Maude

Yes.

Mr. Budgen

My hon. Friend refers to previous years in which there has been a dispute between the United Kingdom—I assume that we are still allowed to refer to the "United Kingdom"—and our masters in the European Community. My recollection is that, on previous occasions, there was a dispute about the necessity for discretionary areas of expenditure, especially in relation to agriculture.

There is a sharp distinction between that and what is set out in the supplementary estimates, which is illegal overspending. Will my hon. Friend confirm that, in previous years when there was a dispute, there was no suggestion that the EC was illegally overspending and that, therefore, today's debate is about something quite different? We are being asked to give parliamentary support for expenditure which, as stated on page 8, is greater than that "permitted by Community legislation".

Mr. Maude

I do not believe that we are asking the House to underpin an illegal arrangement. The right way to contest that budget, if it is found to be illegal, is in the Court and that is what the Council of Ministers will seek to do. When a budget has not been agreed between the institutions, arrangements have always been made to allow payments to be made in any event. That is the course that the Government are inviting the House to follow.

Mr. Leighton

Bearing in mind the fact that many of the member states pay nothing in net terms, can the Minister explain why he uses the curious phrase that more than £1.2 billion is an abnormally low figure? He is telling us, I think, that we have to pay another £450 million this year. What exactly shall we get in return for that money? As we are one of the poorer nations of the Community, why are we not a net beneficiary? Is it not true that we are paying more money into the Community budget to subsidise nations richer than ourselves than we give in aid to the third world? Does that make much sense?

Mr. Maude

We have discussed these matters before, so the hon. Gentleman knows that the amount that we pay in net contributions to the budget is substantially less today than it would have been had we not had to renegotiate a much better arrangement than that which we inherited in 1979.

Mr. Leighton

indicated dissent.

Mr. Maude

The hon. Gentleman shakes his head, but he should acknowledge that the arrangements negotiated by the previous Labour Government were extremely disadvantageous to the United Kingdom. It took my right hon. Friend's negotiations year after year to improve the position which leaves the contribution as relatively limited as it is, although it remains unsatisfactorily large.

Mr. Anthony Beaumont-Dark (Birmingham, Selly Oak)

We understand the Minister's problem although he is arguing a very poor case with his usual great charm and expediency. If it is true that the proposal may be illegal and we shall have to go to the Court, why the hell do we not wait to learn what the Court says? If it is ruled to be illegal, surely we would get the money back. The other lot, when they were in power, did not do a very good job of ensuring that we saved money, but it seems odd to most of us to argue that, because we have done a wonderful job, we are happy to make an illegal payment. To help with his problems, I suggest to the Minister that he withdraws the motion until we find out whether it is a legal or illegal payment. Is that not a helpful and sensible suggestion?

Mr. Maude

I am deluged with helpful suggestions tonight, and I am very grateful to my hon. Friend for making yet another. My hon. Friend put his finger on the point. If the budget is eventually found to be illegal, it is perfectly possible—indeed, it would happen automatically —for the disputed amount of £1 million per month to be recouped as a matter of course. There is no problem about that. I stress to the House that the position of the United Kingdom Government and their net contribution to the EC budget is not prejudiced by the supplementary estimate which I invite the House to adopt tonight.

Mr. Haynes

I hope that the Financial Secretary will listen. The Government have their hands in our pockets again. Is it true that the Government have to bring expenditure to the House for approval first? Will the Minister nod to that? Is it true that any Government expenditure has to be approved by the House?

Mr. Maude

indicated assent.

Mr. Haynes

The Minister agrees. Now we are getting somewhere. The point is that, in Europe, they have got it all wrong, and they have made a cock-up of the job. Now the Minister comes to the House for an additional £450 million because the European budget has already been approved. The Minister is here again because they made a cock-up over there. I will have to go back and tell my constituents that the Government have got their hands in their pockets again.

Mr. Maude

It is not the Government who have their hands in the hon. Gentleman's constituents' pockets. It is the European Community financial arrangements which were negotiated with such skill by the Government whom the hon. Gentleman supported in the late 1970s. I have to—

Mr. Haynes

On a point of order, Mr. Deputy Speaker. I was not a Member of the House at that time, and I do not know what the Minister is talking about. Please call him to order, Mr. Deputy Speaker.

Mr. Maude

For the avoidance of doubt, I concede freely that the hon. Gentleman was not then a Member of the House, although I recollect that he sought unsuccessfully to become a Member. In support—

Mr. Haynes

On a point of order, Mr. Deputy Speaker. I was not a candidate until 1979. The Minister has got it wrong again. He gets it wrong all the time. Please pull him up, Mr. Deputy Speaker.

Mr. Maude

I had not appreciated that the hon. Gentleman joined the Labour party so late in life. He has been a very welcome member of it ever since.

Several Hon. Members

rose—

Mr. Maude

I am conscious that the House wishes to proceed. I have given way in the course of this speech more than I have given way in all my other speeches in the House since I became a Minister. I cannot be accused of treating the House with discourtesy.

The interjections in the speech by my hon. Friends and by other hon. Members have enabled me to set out the case fully. On the basis of those arguments, I invite the House to approve the supplementary estimates.

10.48 pm

Mr. Chris Smith (Islington, South and Finsbury)

The hon. Member for Wolverhampton, South-West (Mr. Budgen) drew attention to the Government's description of the motion on page 8 of the supplementary estimates booklet. That description refers to Payments to the European Communities resulting from the adoption by the European Parliament of a larger Budget for 1992 than that permitted by Community legislation. The figure of £450 million is attached. If that were an accurate description of the situation, it would be a matter of great seriousness to the House. We would be talking about a total of almost £500 million for a budget that appeared to be illegal. However, that is not the situation that faces us. The Government's description is at best inaccurate and it is certainly misleading.

First, in making the European Community budget, the European Parliament cannot and does not act alone. The Parliament and the Council of Ministers acting together form the budgetary authority in the European Community. The Parliament took its most recent decision on the budget on 12 December. It is perhaps worth noting that, when the budgetary committee of the European Parliament met on 9 December, the two Conservative representatives on that committee —Mr. Kellett-Bowman and Mr. Simpson—both voted in favour of the Parliament's budget. It is also worth noting that, when the budget went to the full European Parliament three days later, 29 Conservative Members of the European Parliament voted in favour of the budget.

Mr. Budgen

Does not the hon. Gentleman recognise that there is a clear conflict of interest between Conservative Members of the European Parliament and Conservative Members of Parliament? Quite honourably, the MEPs have sworn their allegiance to a supranational federal structure to which they wish to give enhanced power and extra expenditure. It is naive to pretend that those who vote for extra expenditure in the European Parliament have the same views or the same interests as Members of this House.

Mr. Smith

I was under the obviously mistaken impression that the Conservative party that the MEPs represented was the same as the Conservative party that the hon. Gentleman represents.

The budgetary process, which is a matter for Parliament and the Council of Ministers, has not yet run its full course. As the Minister was forced to admit by the hon. Member for Birmingham, Selly Oak (Mr. Beaumont-Dark), it is perfectly open to the Government to argue within the Council of Ministers for a challenge, through the European Court, to the budget that the Parliament decided on 12 December. The deadline for taking such a challenge to the European Court is 19 February. It is up to the Government and the Council of Ministers to decide whether they wish to mount such a challenge, and they have two more weeks in which to make that decision.

Mr. Maude

The hon. Gentleman said that I was forced to admit that it was open to the Council of Ministers to do that—not a bit of it. I owned up to it perfectly freely—indeed, it is not a question of owning up or admitting to it; I set it before the House. It is clearly the case and there is no secret or anything startling about it.

Mr. Smith

If it is, indeed, clearly the case, we must ask why on earth the motion and the supplementary estimates are before us today. The motion is totally unnecessary if the Council of Ministers is still making a decision about whether to go to the European Court—as it did two years ago—in a process that is a perfectly normal part of the budget-making process. If that is so, it would be wrong to describe the present state of the budget as illegal and it is unnecessary to bring the motion before us. The Government have got the procedure about face.

Mr. William Cash (Stafford)

rose—

Mr. James Hill (Southampton, Test)

rose—

Mr. Smith

I shall give way to the hon. Member for Southampton, Test (Mr. Hill).

Mr. Hill

I thank the hon. Gentleman for his courtesy. I understand that the rules of the European Parliament have been the same for many years in that the Parliament has the ability to vary the budget that is presented to it by about 6 per cent. Of course, that can be challenged. which is where the difficulty is beginning to arise. At the moment, there is no approved budget and the supplementary £450 million is a contingency amount to enable the Community to be able to pay its wages and to keep the Community going. The European Parliament is in a strong position against the Council of Ministers and perhaps even the Commission. The money is needed until the difficulties are sorted out either by the law courts in Luxembourg or by the Council of Ministers giving way.

Mr. Smith

As happened two years ago, it would have been far more sensible to mount a challenge in the courts if the Council of Ministers felt that appropriate and for the disputed elements in the budget—to which I shall come in a moment, because it is worth taking a look at the subject of the dispute—to be effectively frozen and for everything else to be released while the dispute was resolved by the courts. That would have been the sensible procedure, but I am afraid that that is not the way that the Government or Council of Ministers chose.

Mr. Budgen

rose—

Mr. Smith

I have given way once to the hon. Gentleman and will not do so now because I should like to make progress and—

Mr. Nigel Spearing (Newham, South)

rose—

Mr. Smith

I shall give way for the last time to my hon. Friend.

Mr. Spearing

Referring to the answer that he has just given, is my hon. Friend aware of the 1982 recommendations of the Select Committee on the Treasury and Civil Service when the next such occasion arose when, whether or not it was sensible, the procedure that the Government have now adopted—however well explained or unexplained—was recommended? That is why they are doing it now.

Mr. Smith

I believe that the Government have adopted an unnecessary and incorrect procedure, which has certainly not been well explained. My hon. Friend will be aware that the 1982 Select Committee report has already been mentioned. Instead of the Government's rushing to the House with a supplementary estimate vote, it would have been more sensible to ensure that the matter was sorted out in the normal budgetary procedure.

Mr. Cash

rose—

Mr. Terence L. Higgins (Worthing)

rose—

Mr. Smith

I shall give way to the Chairman of the Select Committee on the Treasury and Civil Service, but must then make progress because other hon. Members want to participate.

Mr. Higgins

The purpose of the Select Committee's recommendation at that time was that the House should have an opportunity to debate and consider the matter before the money was handed over. That seemed a sensible arrangement. If we were to proceed as the hon. Gentleman has just suggested and the court case were to go against us, we would be liable for penal rates of interest. The overall effect on our finances would thereby be worsened. That is why that is not a sensible way of proceeding.

Mr. Smith

I follow the right hon. Gentleman about the need to ensure that the House has the opportunity to debate these matters. It is perfectly open to the Government to ensure that that takes place at any stage of the budgetary process. We had our all-too-brief debate on the budget a couple of months ago. As on several other occasions, I should certainly endorse greater openness and parliamentary accountability about what our Ministers get up to in the Council of Ministers.

The first point to bear in mind is that I believe that the procedure we are undertaking tonight is unnecessary.

Mr. Budgen

rose—

Mr. Smith

I shall not give way because of the pressure of time.

The second point is that the increases in the budget, voted by the European Parliament in December, are within the financial perspective for 1992—a financial perspective endorsed and agreed by this Government some years ago.

The 1992 budget, as voted by the Parliament, also represents 1.11 per cent. of Community gross national product, which is 0.09 per cent. below the upper limit of EC expenditure set when the financial perspective was agreed four years ago.

It began to emerge from what the Financial Secretary said that the figure of £450 million is somewhat misleading. The dispute between the European Parliament and the Council of Ministers relates to a far smaller figure than the £450 million British contribution that is before us. The Financial Secretary accepted that, on the Government's own admission, we are talking about an actual difference—an actual dispute—of £12 million for the year.

The root cause of the difference lies with the Foreign Ministers of the Community. Some time ago they decided, collectively, that it would be a good idea if the EC made available substantial sums of additional aid to eastern Europe and the former Soviet Union. They recommended amounts including 860 million ecu in aid for the former Soviet Union and the countries of eastern Europe, 300 million ecu for humanitarian aid, 300 million ecu to bring the structural funds into line with the real rate of inflation and other sums for the tropical rain forests.

The Council of Ministers included those amounts in the budget. However, in recompense for adding those amounts, it said that it did not agree with some of the items that the European Parliament had included in the draft budget. Those items included an appropriation for improving the early-warning system relating to trends in agricultural expenditure—an extremely important monitoring measure in which the Government should be interested—and appropriations for research and development expenditure at a level commensurate with the agreements reached between the Parliament and the Commission.

The dispute is about additions to the budget for eastern Europe and the former Soviet Union, which the Council of Ministers wants to include in the budget, and amounts, principally for expenditure on research and development, which the European Parliament wants to include in the budget.

I have nothing against improving our aid profile to eastern Europe and the former Soviet Union. We all know how important that task is and how strongly the Prime Minister has endorsed it in recent weeks. However, I do not believe that that should take place at the expense of research and development assistance, which our country desperately needs. In fact, Britain receives the lion's share of such expenditure by the EC. We are a net beneficiary of EC funds in terms of reserch and development rather than a net contributor. The Government's proposal would wish upon us a lower amount of such expenditure than would otherwise have been the case. The motion is not only unnecessary but, if the Council of Ministers had its way, it would reduce desperately needed research and development funds.

I want to turn very briefly to the related, but not directly associated, issue of additionality. This concerns European Community budget moneys that we are in danger of being unable to use because of the fact that the Government refuse to accept the rules of procedure. At risk are potential grants of £114 million, under the RECHAR programme, to the coalfield areas of this country, as well as amounts under other regional investment programmes. The dispute is a simple one. It is between the Commission and the Government. The Commission points to article 9 of regulation 4253/88, which states that the money under the regional fund must have a genuine additional economic impact in the regions concerned.

Mr. Cash

Is anyone listening?

Mr. Smith

The hon. Gentleman asks whether anyone is listening. In the coalfield communities of this country, there are many many hundreds of thousands of people for whom this issue is extremely important. As a direct result of the Government's activity and their refusal to abide by the rules, which they endorsed when they agreed the directive, we are losing a large amount in regional investment funds.

Mr. Cash

On a point of order, Mr. Deputy Speaker. I am confident that the hon. Gentleman's point is not directly relevant to this issue. However, may I ask whether it is not the case that Mr. Bruce Millan, the Commissioner, endorsed these very proposals when he was a Minister?

Mr. Deputy Speaker

That is a point for debate, rather than a point of order.

Mr. Smith

We are addressing ourselves to the European Community budget. It seems to me that it is extremely relevant that we should look at funds that are in the budget and ought to be available to the coalfield areas of this country but are not reaching them. I realise that Conservative Members may not like to hear about additionality and about the RECHAR programme. I realise that they may not want to hear about what the Government's activity is denying us.

Mr. Rupert Allason (Torbay)

On a point of order, Mr. Deputy Speaker. Is this debate about the entire Community budget or strictly about this supplementary estimate?

Mr. Deputy Speaker

It is certainly about the supplementary estimate, and I am sure that the hon. Gentleman will address his remarks to that matter.

Mr. Smith

Indeed, I am doing just that. I am addressing my remarks to the £450 million that the Government say should be included. Some of that money goes to the regional funds, which are the subject if the additionality dispute. It is entirely in order to raise this matter, which gives rise to very considerable concern. The hon. Member for Stafford (Mr. Cash) parrots the Secretary of State for the Environment. What he has said is a total misrepresentation of the truth. The rules on additionality came into effect only in 1988. That happened because our Government sat down with the other Governments and agreed that they should come into effect.

Sir Hugh Rossi (Hornsey and Wood Green)

I recall that, when I was in office in Northern Ireland in 1988, the principle of additionality then applied to moneys that were sought to be given by the Commission for the benefit of Northern Ireland, so I am not sure of the history to which the hon. Gentleman is referring.

As the hon. Gentleman has mentioned the coalfields and has introduced that matter into this narrow debate, may I ask whether he is suggesting that the Government should deduct from the £450 million the money that the Commission is withholding from this country? Would he support the Government if that were the proposal?

Mr. Smith

I was referring—had the hon. Gentleman been listening he might have noticed—to regulation 4253/88 passed by the Council of Ministers, including Ministers representing the British Government. I want to ensure that the British Government put enough openness and transparency into the system of regional aid and the RECHAR programme so that our coalfields can get access to the funds due to them. The Government are at fault in ensuring that the money does not come to the coalfield communities, and attempts by the hon. Member for Stafford and various Ministers, including the Secretary of State for the Environment, to say otherwise are nothing short of deliberately misleading.

The Secretary of State for the Environment in 1989, commenting that the structural funds were to be almost doubled over five years, added that, without the principle of additionality, Community funding would become a farce. In 1989, he endorsed the principle of additionality, as had the Government in 1988, but now the Government are refusing to accept the rules that they helped to make. It is about time that the Government changed their approach and made sure that funds that are needed in the coalfield communities of this country reach the places that need them. If they are not prepared to do that, they should give up and make way for a Labour Government to take office, and we will ensure that it happens.

11.11 pm

Sir Teddy Taylor (Southend, East)

I beg to move, That Class XX, Vote 1 be reduced by £100,000.

I ask the House to support a brief and narrow amendment simply expressing our concern about the direction of policy that the Government are proposing, our outrage at the waste of money by the EC, and the total lack of control.

In considering whether we are being told exactly how things stand, I appeal to the Financial Secretary to examine page 2 as well as page 8 of the estimates. Whereas we know that this is the result of an unlawful budget, page 2 talks not about £1 million or £10 million but says that the estimates increase spending by £450 million to £166,431,002,000. So basically it says that, as a result of what we are doing tonight, the estimates are being increased to that specified sum.

But even if we say that that does not matter—even if we save just tuppence—I plead with hon. Members, before deciding on this issue, to consider what happened in 1982 when the same situation arose. The report of the Select Committee at that time said that a precedent was being created. Having said that it considered it to be an unsatisfactory precedent, it recommended that, if it ever happened again, we should not pay the disputed sum.

That is the only issue before the House tonight. Is it right for Parliament to authorise payment for something that is unlawful? If local councillors did what was unlawful and exceeded their budget, they would be individually surcharged. On the same basis, hon. Members who tonight support what is proposed should be surcharged in the sum of £1 million. They would then think twice before lending their support, for I doubt whether many could afford such a surcharge. If a business firm were to spend money illegally, its members could be put in prison. When we consider the hardships suffered by many people in the country today, are we right to vote money illegally?

Mr. Marlow

Opposition Front-Bench Members have suggested that the Government may not, with the other members of the Council of Ministers, challenge this illegal budget. Does my hon. Friend know whether this illegal budget will be challenged, and what is his reaction to that?

Sir Teddy Taylor

I do not know. The same thing happened last time and the Committee asked why our Government did not challenge it. What is the point of saying that we will wait until the Twelve do so? Who are the Twelve? Are they all countries that are paying in money? We know that until recently Britain paid in and Germany paid in, and everybody else took out. Where is the financial control there? Where is the great desire to ensure that there is not extra or illegal spending?

Mr. Budgen

May not my hon. Friend be out of touch with the more progressive and on-going attitude of our party at the present time? As I understand it, we now most of all desire to he at the heart of Europe. Surely that must mean that from time to time we simply lie down and give in to any illegal demands. Would anything else not be completely out of kilter with the modern desire to be friendly to everybody and to avoid confrontation? Surely consensus politics demands that we simply hand the money over. That is what has been done in a large number of other areas, and it would be monstrous not to do the same in relation to Europe.

Sir Teddy Taylor

I am sorry, but I cannot agree with my hon. Friend. I think that if Europe is to be a progressive, forward-looking entity it must have the same principle as we had in the House of Commons—that money is paid out only if it is legally justified, if Parliament authorises it. We do not pay it out and say that we will see if we can get it back later.

It has been suggested that the amount is small. The Minister knows that that is a load of rubbish. Let us look at what happened in November 1987. Labour Members who attend all these debates faithfully will remember it. The previous Prime Minister said that we would make sure that we had strict budgetary controls. She said that we would give them lots of extra money and then the same thing could never happen again. And what happened? They overspent wildly by having a metric year of 10 months, with 12 months of income and 10 months of spending. There was a massive overspend. If hon. Members apply the metric principle to their own balance sheets, they will find that they do very well indeed.

We were told what happened last time. A person called Mr. Spreckley, who works for the Treasury, gave evidence.

He said: As the Lord Privy Seal said at the time of his statement, it would have been preferable had everybody agreed not to pay these disputed sums. Does Parliament want to make illegal payment or does it not? That is the only issue.

Mr. Allason

Would my hon. Friend care to speculate on exactly how the European Community can spend this money if it is not authorised to do so by the European Parliament? As I understand it, we are being asked now to make a payment which will be a part of the illegal budget. How will the Community be able to receive it and to spend it?

Sir Teddy Taylor

I can tell my hon. Friend that it is because, sadly, as he well knows, there are accountancy fiddles daily within the European Community. He knows that what happened in 1988 was a fiddle and a fraud. All hon. Members know it.

We should consider this simple issue: is it right, when the Select Committee told us in 1982 that we should not do it again, that we should not pay the money until there is a full debate?

Any hon. Member who believes in democracy must agree that it is a disgrace and an outrage that we are discussing this vital issue at this time of night, when nobody will know about it, nobody will listen and no one will hear about it. It is a disgrace that all the dirty things to do with Europe, all the scandals of Europe, all the wastes and frauds of Europe, are always discussed here at the dead of night so that people outside do not know what is going on.

Mr. Favell

Has it occurred to my hon. Friend that the winter Olympics will open next weekend? The draft general budget for 1992, which we are discussing today, refers to a second report by the ad hoc committee on a People's Europe, which relates to an appropriation of some £8 million. It then says: This appropriation is intended to cover expenditure on financing certain public relations projects in connection with a major Community presence at the 1992 Olympic Games in Albertville and Barcelona, in particular participation in the opening and closing ceremonies and action to underpin the Community identity of athletes from the Member States. To this end, the European Community flag will be used, particularly during the presentation of medals. That is to cost £8 million. The Community has already spent £700,000, on the world student games in Sheffield in July on what became known in Sheffield as "Europe Day". If my hon. Friend the Member for Southend, East watched the rugby world cup, he will have seen that every time a player threw a ball in, a European flag appeared behind him. Unfortunately, I have been unable to discover how much that cost, but the advertising agent assures me that the Community was the patron.

Sir Teddy Taylor

My hon. Friend is quite right, and hon. Members should be concerned about that. They should not smile about it because it is a waste of money.

Mr. Budgen

Will my hon. Friend give way?

Sir Teddy Taylor

No, certainly not.

My hon. Friend the Member for Billericay (Mrs. Gorman), who is always so conscientious, will confirm that the EC has just given Essex county council a grant to assist it in dealing with the problems created by Essex boy and Essex girl jokes. Furthermore, the EC has paid 170 million lira to a mafia-controlled firm for delivering non-existent fruit juice to NATO headquarters in Palermo, and it cannot get the money back. Ultimately, those who care about cash, especially hon. Members from Northern Ireland who know about poverty because they see so much of it, will be concerned that we should not waste money.

Mr. Budgen

Will my hon. Friend give way?

Sir Teddy Taylor

Certainly not.

There are one or two fanatics around whom we should disregard. One or two of the Euromugs, including the hon. Member for Islington, South and Finsbury (Mr. Smith), give us the same old drivel every time. They say that the Common Market is wonderful and should be given more money to spend. The realists are concerned about people's problems. The time has come for the House of Commons to make a stand and say that we are fed up with fraud, waste and the European Community spending money that it is not authorised to spend.

My hon. Friend the Minister has said that we should not bother about the matter too much because the paper does not really mean what it says. Although this expensive paper produced by the Treasury says that an extra £450 million is wanted to pay for an illegal budget, my hon. Friend says that it does not really mean that. Although it says that it will put up the Government estimates by £450 million to £166,431,002,000, my hon. Friend says that it does not really mean that. We are fed up to the teeth with this because we know that people are suffering from it. Money matters.

My hon. Friend the Member for Aldridge-Brownhills (Mr. Shepherd) is always present during these debates because he is concerned about protecting people's interests. He was telling me what that £450 million will mean. For every pensioner on housing benefit, it will mean £5 a week, which is a lot of money. So we are not talking about silly amounts.

We should bear in mind that, when this happened before, a Select Committee told us that next time it happens we should not be mugs and pay it but should just say no. It told us that if the Community wants Britain to pay for illegal money, we should let it take us to court. The Council of Ministers should be aware that, if that matter goes to the European Court, we might win. The majority of the members of that Council are being paid cash for being in the EC. The time has come to say no.

We have tabled a modest amendment. It does not seek to scrap the motion or wreck the Government's policy—

Mr. Richard Shepherd (Aldridge-Brownhills)

We have been trying to do that for years.

Sir Teddy Taylor

My hon. Friend is right.

We say to the moderate Members who feel that something is wrong and should be put right that they should vote in favour of reducing the payment by £100,000. Let us give that to the poor and to the places which need help. In other words, we are not suggesting that the Conservative party or the Labour party should stand on its head. We simply say that we are fed up to the teeth with the waste and extravagance throughout Europe, and with the fact that expenditure is not controlled.

At the end of the day, the House of Commons should not be asked to pay for unlawful money. That is what we are being asked to do tonight. When that last happened, hon. Members will remember, a chap called King Charles had his head chopped off. The time has come for someone's head to roll. We have to stand firm.

There are not many hon. Members present. By having the debate late at night, the Government have made sure that the public will not hear about it. We have to stand firm. I appeal to the Labour Members who are always here—the decent, conscientious people who fight for the interests of their country—and to Conservative Members too to remember that democracy is more important than party politics. Therefore, I appeal to the House to make a gesture by voting for the modest amendment. In that way the House will say that the time has come to say no, and it will give a warning that it is fed up.

11.25 pm

Mr. Denzil Davies (Llanelli)

The Financial Secretary sought to give the impression that somehow the post-Fontainebleau arrangements negotiated by the Government were superior to those negotiated by the Labour Government. He is nodding his head. The system of payments that existed between 1972 and the Fontainebleau agreement of 1984 was negotiated by the right hon. Member for Old Bexley and Sidcup (Mr. Heath) when the country acceded to the treaty of Rome. From 1972 to 1984 that was the system. From 1972 to 1977 there was a five-year transitional period. It was only in 1978 that the system of full payments came in.

There was an election in 1979. It took the Government five years to reach the Fontainebleau agreement. I make no complaint about that and pay tribute to the Government for doing so, but the Financial Secretary should not give the impression that somehow the system that the Conservative Government negotiated was better than that negotiated by the Labour Government.

Mr. Maude

I simply remind the right hon. Gentleman of what the Labour Government said at the time, which was that they had renegotiated the arrangements.

Mr. Davies

They were never renegotiated. May I make another point to the hon. Gentleman? Apparently some of the payments will be in respect of a possible illegal budget. This is not the first time that has happened. In 1978 there was a possible illegal budget exactly like this one, but the Labour Government did not come to the House and seek approval to pay money over while a dispute was going on. We stopped the cheque. By doing so, we got agreement fairly quickly. Stopping the cheque concentrates the mind, especially of the Commission. The Government should not pay the money. That would lead to the dispute being resolved quickly. The Government should not seek approval to pay money in respect of what could be an illegal budget.

Let us consider the Fontainebleau agreement. Despite that agreement, the United Kingdom is still the second largest net contributor to the budget. There are only two net contributors, year in, year out—Germany and Britain. It is no good the Minister shaking his head. France sometimes becomes a net contributor; the following year it probably is not. Next year we will contribute £2.45 billion to the Community budget. Yet in terms of the per capita GDP, the wealth of the country, we rank below Luxembourg, Germany, France, Italy, Denmark and probably Holland. Despite that, we are the second major net contributor to the budget. Despite Fontainebleau, we are in the same relative position as we were before that agreement.

There must be something wrong with such a system, and we know what it is. We import more, we consume more and the common agricultural policy does not benefit us because we do not receive the payments because of the size and structure of our agricultural sector.

Some people fondly believe that if we could reform the CAP we would pay less. This is not the place to debate the MacSharry proposals—I do not understand them all—but, having read them cursorily, I do not think that we would pay less even if the CAP were reformed under the MacSharry proposals. I do not believe that it will ever be reformed from inside, but if it were there would be large redundancy payments to the smaller farmers of Europe. The motor car workers who return home at night and milk a few cows will receive redundancy payments under the MacSharry plan, whereas the official farmers will be thrown to the market place and will not receive payments. To think that a reform of the CAP, should it ever take place, would reduce our contribution is to live in cloud cuckoo land.

It was suggested that if we could convert the CAP so that it withered away and became a sort of common regional policy, we would benefit. I am not sure about that. The Maastricht agreement contains a section dealing with "social cohesion"—I think that that is the latest phrase to be in vogue in the Community. As I understand it, the infrastructure fund is paid to member states in which the gross domestic product per head of population is below that of the Community average—£100. The rate for the United Kingdom is more than £100, countries with below average rates are Southern Ireland, Spain, Portugal and Greece. Therefore, even the new common regional policy will not benefit us, despite the fact that GDP per head in Wales is £85—or £87 last year—in Scotland the figure hovers around £100, for the north of England the figure is below £100 and in the west midlands it is below £100, as it is in the north-west. Even that attempt at social cohesion does not benefit a country such as the United Kingdom in which the GDP per head is higher than the Community average.

I do not know how we shall benefit from any of the systems, yet we must do so. If we move towards economic and monetary union, the countries and regions on the Community's fringes—such as Wales, the north-west and the south-west—will suffer from the concentration and centralisation of a common currency.

Next year, we will repay £2.5 billion—a not abnormally high amount—in public expenditure. That money could be used for hospitals, schools, research and development—which my hon. Friend the Member for Islington, South and Finsbury (Mr. Smith) rightly said was important. That money will go across the exchanges to the undemocratic, bureaucratic institution and we shall never get it back. I do not believe that that institution will ever be reformed from the inside. The only hope—and it may be vain—is that changes in Europe and the enlargement of the Community will bring down the whole, silly edifice. The sooner that that happens, the better.

11.33 pm

Rev. Ian Paisley (Antrim, North)

On the issue of additionality, it should be known that there is a constant fight between the Treasury and Ministers heading their Departments. Today I spoke to the Minister who is in charge of agriculture in Northern Ireland. He told me that he was fighting for moneys that his Department should receive, and that the Treasury was holding them up.

I believe that money from Europe that is earmarked for a specific job in a certain district in the United Kingdom should be additional money used for that purpose. Many schemes, such as the Spede scheme in Northern Ireland, are suffering at present, whereas those benefiting from the system in the Irish republic are using that power and money to undercut our economy. They already have their money. All sorts of additional moneys should be coming to us, and we should try to settle that issue once and for all.

If any Department had presented this estimate with such a degree of misrepresentation and falsehoods, the Minister involved would have been hounded out of the House. The Financial Secretary says that the House has not been given an accurate account of the provision for which it is asked to vote. We were given all sorts of explanations. Some tell us that we are voting for only £1 million a month, and others that the figure might be the whole £450 million. The House should know exactly how much it is being asked to pay.

The Financial Secretary nodded when the hon. Member for Ashfield (Mr. Haynes) asked whether the consent of the House was required. When the hon. Member for Ashfield said, The Government have their hands in our pockets again", the Minister replied, "I do not have my hands in your pockets, but Europe does." It is the Minister's business to get Europe's hands out of the nation's pockets, because they are the hands of a thief. They are the hands of a law-breaker. They are the hands of a criminal. It is the Financial Secretary's duty to stop Europe's criminal practices.

I am asked as a Member of the House to vote on something that is not permitted by Community legislation. Let us admit that. If that is so, how can a Minister who believes in law and order ask the House to vote for something that is illegal? I say to the Financial Secretary that if he wants to impress Europe he must take the action suggested by the right hon. Member for Llanelli (Mr. Davies), and tell Europe, "We're not giving you the money. Go to the courts and ask for the money. If the courts of Europe say that we have to pay, we will consider it again." He should promise not to pay, but only to reconsider. That is the attitude that the Minister should adopt.

Mr. Cash

In view of my hon. Friend's extremely effective speech, does he consider that we ought to refer the matter to the Privileges Committee or to the Chairman of Ways and Means? If the House, even on the Government's own admission, is expected to make an illegal payment of as little, comparatively speaking, as £12 million—let alone £450 million on the Order Paper—that should be investigated by the House. We cannot be an engine of fraud. If the issue were referred to the courts, they would decide against the House. Does not my hon. Friend seriously consider having the matter thoroughly investigated—and not merely at this time of night?

Rev. Ian Paisley

Anything that could stop a law-breaker should be employed. That is what we are saying in Northern Ireland. We should take steps to stop the law-breakers—and we have deliberate law-breaking here. It is for the Minister to take Europe's hand—and I trust that he has a supremely tough hand of his own—and say, "So far and no further." The House must make its view absolutely clear.

If Europe gets away with it this time, it will do it again. Instead of a sum of £12 million, it could be £120 million, and so on. Let us stop it now. It rests with the Financial Secretary to stand up—and be an Oliver Cromwell, I was going to say—and decapitate the law-breaker.

Mr. Moate

On a point of order, Mr. Deputy Speaker. On several occasions this evening—including the Financial Secretary's statement—it has been stated that the motion is wrong. The Financial Secretary said explicitly that we were discussing a sum of £12 million; the motion refers to £450 million. The Financial Secretary said that it could have been more happily worded—which is a euphemistic way of saying that it is wrong.

Surely, Mr. Deputy Speaker, you have heard enough to realise that the House is being asked to pass a motion that has been admitted to be incorrect. Surely that cannot be permissible. What powers have you to urge the Government either to withdraw the motion, or to have it amended by manuscript amendment now, so that the House can at least be asked to deal with a motion that is correct and honest?

Mr. Deputy Speaker

That matter was raised with Mr. Speaker yesterday on a point of order. Mr. Speaker ruled that the motions were in order, and that if they were found in due course to be illegal, it would be a matter for the courts. That ruling is on the record, and I cannot add to it or subtract from it.

Mr. Moate

Further to that point of order, Mr. Deputy Speaker. I appreciate your ruling, but, with respect, I am making a rather different point. It does not concern the question of legality; it simply concerns the accuracy of the motion. The motion suggests that the whole £450 million relates to illegal payments, but the Financial Secretary has made it clear that the illegal payment is just £12 million. The motion is admittedly wrong; surely it should be withdrawn or ruled out of order.

Mr. Deputy Speaker

That is a matter for debate; it is not a point of order.

Mr. Marlow

Further to the point of order, Mr. Deputy Speaker.

Mr. Deputy Speaker

Order. I have dealt with the point of order; and it was dealt with by Mr. Speaker yesterday. There is very little time left.

Mr. Marlow

On a point of order, Mr. Deputy Speaker. As we have been told, we are discussing an illegal budget—an illegal payment. Can we somehow be given legal advice by a Law Officer of the Crown about the implications of the House conniving at an illegal payment—conniving at fraud? The House has agreed to pay money that is illegal.

Mr. Deputy Speaker

Order. We are debating a matter that is in order. Hon. Members are perfectly entitled, when the time comes very shortly, to vote against it if they so desire. We would not be debating the matter if it were not in order.

Mr. Budgen

On a point of order, Mr. Deputy Speaker. Surely there is a specifically legal point involved in advising the House about our rights in relation to the institutions of the European Community. My hon. Friend the Financial Secretary, with his distinguished background as an Old Bailey criminal lawyer, was most effective in defending the Government in support of fraudulent activities; but surely it would not be unkind or impertinent to him to demand something rather distinguished in the way of advice from the Attorney-General. He says that there are many important manifestations of the federal law of the EEC that are unknown to the House. We should like to know our chances of preventing the payments by going through the no doubt very splendid procedures of the European Court. Until we have the Attorney-General's advice, we are in the dark.

Mr. Deputy Speaker

The hon. Gentleman may be in time to tempt the Financial Secretary to rise, but he certainly will not tempt me.

11.43 pm

Mr. Nigel Spearing (Newham, South)

It seems to me that the question is not about illegality, but about whether or not the budget is legal. In a powerful speech, the hon. Member for Antrim, North (Rev. Ian Paisley) put his finger on the point. We are now discussing political power and authority—the power of a person and, in the end, of the House. By tabling a motion on Friday, which unfortunately I did not see because I was not here, the Government have restricted our debate to an hour and a half. That is wrong. The Chairman of the Treasury and Civil Service Select Committee, which has produced reports on this matter, has not spoken. He should have been able to make a contribution. Also, for all his qualities, the Financial Secretary did not really explain what is going on. It would have been better if the Government had presented a document in the form of a White Paper to explain the background before the debate took place.

Mr. Derek Enright (Hemsworth)

That is unreasonable.

Mr. Spearing

In this Parliament, we want explanations from our Government before the debate starts. We have not had that, and that is why we will force a Division. The traditional way of showing dissatisfaction with the activities of a Government or their proposals that have not been properly debated is to move a motion suggesting a token reduction in the amount involved. My hon. Friend the Member for Islington, South and Finsbury (Mr. Smith) said that, technically, that might make some reduction in this, that or the other. However, everybody knows that, when we used to table motions about reductions of salaries or of a vote, it was a protest.

We have not had proper procedural debates on this topic. The Government have not provided sufficient information, and there is confusion over whether the sum is £12 million or £450 million, not to mention the £1,000 million of contingency vote that is mentioned elsewhere but to which no hon. Member has referred. Given all that, hon. Members should feel justified in voting for the amendment as a token of their dissatisfaction at the way in which the House has been treated.

I hope that the Chairman of the Treasury Select Committee will have a few seconds to address the House.

11.46 pm

Mr. Terence L. Higgins (Worthing)

I have only a few seconds. Can the Financial Secretary confirm that it is the Government's intention to oppose the illegal budget? Can he confirm that, if we go along with the estimate and win, the money will be returned to us by one means or another, perhaps by withholding VAT payments?

It being one and a half hours after the commencement of proceedings on the motion, MR. DEPUTY SPEAKER put the Questions necessary to dispose of the motions relating to supplementary estimates 1991–92 and estimates 1992–93, pursuant to the Order yesterday.

Question put, That the amendment be made:—

The House proceeded to a Division—

Mr. Budgen (seated and covered)

On a point of order, Mr. Deputy Speaker. Can the Financial Secretary briefly answer the questions put by my right hon. Friend the Member for Worthing (Mr. Higgins)? Do the Government intend to oppose this illegal—

Mr. Deputy Speaker

Order. I have put the Question and we are now proceeding to a Division. I cannot allow any further debate.

Sir Teddy Taylor (seated and covered)

On a point of order, Mr. Deputy Speaker. Nobody shouted, "No." We did not hear anyone shout, "No."

Mr. Deputy Speaker

I do not want any confusion. I put the Question on the amendment of the hon. Member for Southend, East (Sir T. Taylor). To be completely clear, I shall put the Question again.

Question put, That the amendment be made:—

The House proceeded to a Division—

Mr. Marlow (seated and covered)

On a point of order, Mr. Deputy Speaker. There is general agreement in the House that the first time you put the Question a strong Aye was given, but there was no contrary indication, no "No".

Mr. Deputy Speaker

Order. We have been through this process twice now. It was wholly clear to me that there were both Ayes and Noes, and we are now proceeding to a Division. [Interruption.] Order. There can be no further points of order.

Mr. Marlow (seated and covered)

On a point of order, Mr. Deputy Speaker. You will be aware that the proceedings of this House are recorded. If it transpires on that recording that there was no No given the first time you put the Question, is not the second time you put the Question invalid, and does not the amendment therefore pass without a Division? The evidence is there and the matter can be checked.

Mr. Deputy Speaker

Order. The House knows the procedures very well. I have already put the Question on the amendment of the hon. Member for Southend, East (Sir T. Taylor), and we are now proceeding to vote on that amendment.

Mr. Marlow (seated and covered)

Further to that point of order, Mr. Deputy Speaker. Is it in order for the Question to be put a second time when the amendment was passed without demur on the first occasion?

Mr. Deputy Speaker

Order. We are now proceeding to a Division. [Interruption.] Order. There are no further points of order.

Mr. Tim Janman (Thurrock) (seated and covered)

On a point of order, Mr. Deputy Speaker. Is it in order to proceed to a Division when there were no Noes when you first put the Question?

Mr. Deputy Speaker

Order. I shall take no further points of order until the Division is completed.

The House having divided: Ayes 27, Noes 220.

Division No. 67]	[11.46 pm
AYES
Barnes, Harry (Derbyshire NE)	Mitchell, Austin (G't Grimsby)
Beggs, Roy	Moate, Roger
Body, Sir Richard	Molyneaux, Rt Hon James
Budgen, Nicholas	Paisley, Rev Ian
Cash, William	Ross, William (Londonderry E)
Conway, Derek	Shepherd, Richard (Aldridge)
Cryer, Bob	Skinner, Dennis
Dover, Den	Spearing, Nigel
Gill, Christopher	Winnick, David
Gorman, Mrs Teresa	Winterton, Mrs Ann
Howarth, G. (Cannock & B'wd)	Winterton, Nicholas
Janman, Tim
Kilfedder, James	Tellers for the Ayes:
Leighton, Ron	Sir Teddy Taylor and
McCrea, Rev William	Mr. Jonathan Aitken.
Marlow, Tony

NOES
Alexander, Richard	Blackburn, Dr John G.
Alison, Rt Hon Michael	Blaker, Rt Hon Sir Peter
Allason, Rupert	Boscawen, Hon Robert
Alton, David	Boswell, Tim
Amess, David	Bottomley, Peter
Amos, Alan	Bottomley, Mrs Virginia
Arbuthnot, James	Bowden, Gerald (Dulwich)
Arnold, Jacques (Gravesham)	Bowis, John
Arnold, Sir Thomas	Boyson, Rt Hon Dr Sir Rhodes
Ashby, David	Brazier, Julian
Atkins, Robert	Bright, Graham
Baker, Rt Hon K. (Mole Valley)	Bruce, Ian (Dorset South)
Baker, Nicholas (Dorset N)	Burns, Simon
Baldry, Tony	Butcher, John
Banks, Robert (Harrogate)	Butler, Chris
Batiste, Spencer	Butterfill, John
Bellingham, Henry	Carlisle, Kenneth (Lincoln)
Bennett, Nicholas (Pembroke)	Carrington, Matthew

Channon, Rt Hon Paul	Latham, Michael
Chapman, Sydney	Lawrence, Ivan
Churchill, Mr	Lee, John (Pendle)
Clark, Rt Hon Alan (Plymouth)	Leigh, Edward (Gainsbor'gh)
Clark, Dr Michael (Rochford)	Lennox-Boyd, Hon Mark
Clarke, Rt Hon K. (Rushcliffe)	Lester, Jim (Broxtowe)
Colvin, Michael	Livsey, Richard
Cope, Rt Hon Sir John	Lloyd, Sir Ian (Havant)
Couchman, James	Lloyd, Peter (Fareham)
Currie, Mrs Edwina	Lord, Michael
Davies, Q. (Stamf'd & Spald'g)	Luce, Rt Hon Sir Richard
Davis, David (Boothferry)	Lyell, Rt Hon Sir Nicholas
Day, Stephen	MacGregor, Rt Hon John
Devlin, Tim	MacKay, Andrew (E Berkshire)
Dickens, Geoffrey	Maclean, David
Dorrell, Stephen	McLoughlin, Patrick
Dunn, Bob	McNair-Wilson, Sir Patrick
Evans, David (Welwyn Hatf'd)	Madel, David
Evennett, David	Malins, Humfrey
Fallon, Michael	Marshall, Sir Michael (Arundel)
Field, Barry (Isle of Wight)	Martin, David (Portsmouth S)
Fishburn, John Dudley	Maude, Hon Francis
Fookes, Dame Janet	Mayhew, Rt Hon Sir Patrick
Forsyth, Michael (Stirling)	Mellor, Rt Hon David
Forth, Eric	Meyer, Sir Anthony
Fowler, Rt Hon Sir Norman	Miller, Sir Hal
Fox, Sir Marcus	Mills, Iain
Franks, Cecil	Mitchell, Andrew (Gedling)
Freeman, Roger	Mitchell, Sir David
French, Douglas	Monro, Sir Hector
Garel-Jones, Rt Hon Tristan	Montgomery, Sir Fergus
Glyn, Dr Sir Alan	Morris, M (N'hampton S)
Goodlad, Rt Hon Alastair	Morrison, Sir Charles
Goodson-Wickes, Dr Charles	Morrison, Rt Hon Sir Peter
Gorst, John	Moss, Malcolm
Greenway, Harry (Ealing N)	Moynihan, Hon Colin
Greenway, John (Ryedale)	Neale, Sir Gerrard
Gregory, Conal	Nelson, Anthony
Griffiths, Peter (Portsmouth N)	Nicholls, Patrick
Grist, Ian	Nicholson, David (Taunton)
Ground, Patrick	Nicholson, Emma (Devon West)
Hague, William	Norris, Steve
Hamilton, Rt Hon Archie	Oppenheim, Phillip
Hamilton, Neil (Tatton)	Page, Richard
Hampson, Dr Keith	Paice, James
Hanley, Jeremy	Patnick, Irvine
Hannam, Sir John	Patten, Rt Hon Chris (Bath)
Hargreaves, A. (B'ham H'll Gr')	Pawsey, James
Hargreaves, Ken (Hyndburn)	peacock, Mrs Elizabeth
Harris, David	Portillo, Michael
Haselhurst, Alan	Powell, William (Corby)
Hawkins, Christopher	Price, Sir David
Hayes, Jerry	Raffan, Keith
Hayhoe, Rt Hon Sir Barney	Raison, Rt Hon Sir Timothy
Heathcoat-Amory, David	Redwood, John
Hicks, Mrs Maureen (Wolv' NE)	Riddick, Graham
Hicks, Robert (Cornwall SE)	Ridley, Rt Hon Nicholas
Hill, James	Rifkind, Rt Hon Malcolm
Hind, Kenneth	Roberts, Rt Hon Sir Wyn
Hogg, Hon Douglas (Gr'th'm)	Rossi, Sir Hugh
Hordern, Sir Peter	Sackville, Hon Tom
Howarth, Alan (Strat'd-on-A)	Sayeed, Jonathan
Howell, Rt Hon David (G'dford)	Scott, Rt Hon Nicholas
Hughes, Robert G. (Harrow W)	Shaw, David (Dover)
Hunt, Rt Hon David	Shaw, Sir Giles (Pudsey)
Hurd, Rt Hon Douglas	Shaw, Sir Michael (Scarb')
Irvine, Michael	Sims, Roger
Jack, Michael	Skeet, Sir Trevor
Jackson, Robert	Smith, Tim (Beaconsfield)
Johnson Smith, Sir Geoffrey	Speller, Tony
Jones, Gwilym (Cardiff N)	Spicer, Sir Jim (Dorset W)
Jones, Robert B (Herts W)	Spicer, Michael (S Worcs)
Jopling, Rt Hon Michael	Squire, Robin
King, Roger (B'ham N'thfield)	Stanbrook, Ivor
King, Rt Hon Tom (Bridgwater)	Stanley, Rt Hon Sir John
Kirkhope, Timothy	Stephen, Nicol
Knapman, Roger	Stern, Michael
Knight, Greg (Derby North)	Stevens, Lewis
Knowles, Michael	Stewart, Andy (Sherwood)
Knox, David	Stewart, Rt Hon Sir Ian

Sumberg, David	Wheeler, Sir John
Taylor, Ian (Esher)	Whitney, Ray
Temple-Morris, Peter	Widdecombe, Ann
Thompson, Patrick (Norwich N)	Wilkinson, John
Thorne, Neil	Wilshire, David
Thurnham, Peter	Wolfson, Mark
Townsend, Cyril D. (B'heath)	Wood, Timothy
Tredinnick, David	Woodcock, Dr. Mike
Vaughan, Sir Gerard	Yeo, Tim
Viggers, Peter	Young, Sir George (Acton)
Walden, George
Wallace, James	Tellers for the Noes:
Wardle, Charles (Bexhill)	Mr. David Lightbown and
Wells, Bowen	Mr. John M. Taylor.

Question accordingly negatived.

Main Question put:—

The House divided: Ayes 223, Noes 16.

Division No. 68]	[12 midnight
AYES
Aitken, Jonathan	Fallon, Michael
Alexander, Richard	Field, Barry (Isle of Wight)
Alison, Rt Hon Michael	Fishburn, John Dudley
Allason, Rupert	Fookes, Dame Janet
Alton, David	Forsyth, Michael (Stirling)
Amess, David	Forth, Eric
Amos, Alan	Fowler, Rt Hon Sir Norman
Arbuthnot, James	Fox, Sir Marcus
Arnold, Jacques (Gravesham)	Franks, Cecil
Arnold, Sir Thomas	Freeman, Roger
Ashby, David	French, Douglas
Aspinwall, Jack	Garel-Jones, Rt Hon Tristan
Atkins, Robert	Glyn, Dr Sir Alan
Baker, Rt Hon K. (Mole Valley)	Goodlad, Rt Hon Alastair
Baker, Nicholas (Dorset N)	Goodson-Wickes, Dr Charles
Baldry, Tony	Gorst, John
Banks, Robert (Harrogate)	Greenway, Harry (Ealing N)
Batiste, Spencer	Greenway, John (Ryedale)
Bellingham, Henry	Gregory, Conal
Bennett, Nicholas (Pembroke)	Griffiths, Peter (Portsmouth N)
Blackburn, Dr John G.	Grist, Ian
Blaker, Rt Hon Sir Peter	Ground, Patrick
Boscawen, Hon Robert	Hague, William
Boswell, Tim	Hamilton, Rt Hon Archie
Bottomley, Peter	Hampson, Dr Keith
Bottomley, Mrs Virginia	Hanley, Jeremy
Bowden, Gerald (Dulwich)	Hannam, Sir John
Bowis, John	Hargreaves, A. (B'ham H'll Gr')
Boyson, Rt Hon Dr Sir Rhodes	Hargreaves, Ken (Hyndburn)
Brazier, Julian	Harris, David
Bright, Graham	Haselhurst, Alan
Bruce, Ian (Dorset South)	Hawkins, Christopher
Burns, Simon	Hayes, Jerry
Butcher, John	Hayhoe, Rt Hon Sir Barney
Butler, Chris	Heathcoat-Amory, David
Butterfill, John	Hicks, Mrs Maureen (Wolv' NE)
Carlisle, Kenneth (Lincoln)	Hicks, Robert (Cornwall SE)
Carrington, Matthew	Higgins, Rt Hon Terence L.
Channon, Rt Hon Paul	Hill, James
Chapman, Sydney	Hind, Kenneth
Chope, Christopher	Hogg, Hon Douglas (Gr'th'm)
Churchill, Mr	Hordern, Sir Peter
Clark, Rt Hon Alan (Plymouth)	Howarth, Alan (Strat'd-on-A)
Clark, Dr Michael (Rochford)	Howell, Rt Hon David (G'dford)
Clarke, Rt Hon K. (Rushcliffe)	Hughes, Robert G. (Harrow W)
Colvin, Michael	Hunt, Rt Hon David
Cope, Rt Hon Sir John	Hurd, Rt Hon Douglas
Couchman, James	Irvine, Michael
Currie, Mrs Edwina	Jack, Michael
Davies, Q. (Stamf'd & Spald'g)	Jackson, Robert
Davis, David (Boothferry)	Jones, Gwilym (Cardiff N)
Day, Stephen	Jones, Robert B (Herts W)
Devlin, Tim	Jopling, Rt Hon Michael
Dickens, Geoffrey	King, Roger (B'ham N'thfield)
Dorrell, Stephen	King, Rt Hon Tom (Bridgwater)
Dunn, Bob	Kirkhope, Timothy
Evans, David (Welwyn Hatf'd)	Knapman, Roger
Evennett David	Knight, Greg (Derby North)

Knowles, Michael	Raffan, Keith
Knox, David	Raison, Rt Hon Sir Timothy
Latham, Michael	Redwood, John
Lawrence, Ivan	Riddick, Graham
Lee, John (Pendle)	Ridley, Rt Hon Nicholas
Leigh, Edward (Gainsbor'gh)	Rifkind, Rt Hon Malcolm
Lennox-Boyd, Hon Mark	Roberts, Rt Hon Sir Wyn
Lester, Jim (Broxtowe)	Rossi, Sir Hugh
Lightbown, David	Sackville, Hon Tom
Livsey, Richard	Sayeed, Jonathan
Lloyd, Sir Ian (Havant)	Scott, Rt Hon Nicholas
Lloyd, Peter (Fareham)	Shaw, David (Dover)
Lord, Michael	Shaw, Sir Giles (Pudsey)
Luce, Rt Hon Sir Richard	Shaw, Sir Michael (Scarb')
Lyell, Rt Hon Sir Nicholas	Sims, Roger
MacGregor, Rt Hon John	Skeet, Sir Trevor
MacKay, Andrew (E Berkshire)	Smith, Tim (Beaconsfield)
Maclean, David	Speller, Tony
McLoughlin, Patrick	Spicer, Sir Jim (Dorset W)
McNair-Wilson, Sir Patrick	Squire, Robin
Madel, David	Stanbrook, Ivor
Malins, Humfrey	Stanley, Rt Hon Sir John
Marshall, Sir Michael (Arundel)	Stephen, Nicol
Martin, David (Portsmouth S)	Stern, Michael
Maude, Hon Francis	Stevens, Lewis
Mayhew, Rt Hon Sir Patrick	Stewart, Andy (Sherwood)
Mellor, Rt Hon David	Stewart, Rt Hon Sir Ian
Meyer, Sir Anthony	Sumberg, David
Miller, Sir Hal	Taylor, Ian (Esher)
Mills, Iain	Temple-Morris, Peter
Mitchell, Andrew (Gedling)	Thompson, Patrick (Norwich N)
Mitchell, Sir David	Thorne, Neil
Moate, Roger	Thurnham, Peter
Monro, Sir Hector	Townsend, Cyril D. (B'heath)
Montgomery, Sir Fergus	Tredinnick, David
Morris, M (N'hampton S)	Vaughan, Sir Gerard
Morrison, Sir Charles	Viggers, Peter
Morrison, Rt Hon Sir Peter	Walden, George
Moss, Malcolm	Wallace, James
Moynihan, Hon Colin	Wardle, Charles (Bexhill)
Neale, Sir Gerrard	Wells, Bowen
Nelson, Anthony	Wheeler, Sir John
Nicholls, Patrick	Whitney, Ray
Nicholson, David (Taunton)	Widdecombe, Ann
Nicholson, Emma (Devon West)	Wilkinson, John
Norris, Steve	Wilshire, David
Oppenheim, Phillip	Wolfson, Mark
Page, Richard	Wood, Timothy
Paice, James	Woodcock, Dr. Mike
Patnick, Irvine	Yeo, Tim
Patten, Rt Hon Chris (Bath)	Young, Sir George (Acton)
Pawsey, James
Peacock, Mrs Elizabeth	Tellers for the Ayes:
Portillo, Michael	Mr. John M. Taylor and
Powell, William (Corby)	Mr. Neil Hamilton.
Price, Sir David

NOES
Beggs, Roy	Paisley, Rev Ian
Body, Sir Richard	Ross, William (Londonderry E)
Budgen, Nicholas	Shepherd, Richard (Aldridge)
Cash, William	Taylor, Sir Teddy
Dover, Den	Winterton, Mrs Ann
Gill, Christopher	Winterton, Nicholas
Gorman, Mrs Teresa
Janman, Tim	Tellers for the Noes:
McCrea, Rev William	Mr. Bob Cryer and
Molyneaux, Rt Hon James	Mr. Dennis Skinner.

Question accordingly agreed to.

Resolved, That a further supplementary sum not exceeding £450,000,000 he granted to Her Majesty out of the Consolidated Fund to defray the charges for civil services which will come in course of payment during the year ending on 31st March 1992, as set out in House of Commons Paper No. 182 of Session 1991–92.