§ `This Act shall come into force only when the House of Commons has come to a Resolution on a motion tabled by a Minister of the Crown considering the question of adopting the Protocol on Social Policy.'.—[Mr. George Robertson.]
§ Brought up, and read the First time.4.19 pm
§ The Chairman of Ways and Means (Mr. Michael Morris)
With this it will be convenient to discuss also new clause 75—Transferred Powers (Commencement)—'No power transferred by this Act from the United Kingdom to European institutions shall be so transferred unless and until the House of Commons has had an opportunity to vote on a motion tabled by a Minister of the Crown relating to the incorporation or otherwise of the United Kingdom into the Agreement annexed to the Protocol on Social Policy.'.
§ Mr. Robertson
I understand that, although they have not yet said so, the Government intend to accept the new clause. That is interesting. It is not a concession, but a surrender. It is an admission by the Government that they have no majority and no authority on this issue and that they face defeat in Committee. Rather than face that defeat honourably, they have simply said that it does not matter.
I intend to consider the new clause in detail and to explain to the Committee and the sceptics perched on the Back Benches precisely what its effect will be and precisely how it will place them on the spot—on the horns of their ultimate dilemma.
This is a new debate, but it is hardly a new subject.
§ Sir Teddy Taylor
I promise that this will be my one intervention. Can the hon. Gentleman tell us how there is a dilemma over new clause 74 when the Government have already said that, whether we vote for or against it or chuck it out of the window, they will leave us in the treaty? What is the point of it?
§ Mr. Robertson
To believe the hon. Gentleman when he says that he intends to intervene "just once" is like listening to the right hon. Member for Watford (Mr. Garel-Jones) and accepting that his is the authoritative view of the Government.
528 I shall tell the hon. Member for Southend, East (Sir T. Taylor) precisely why new clause 74 is the ticking bomb. I hope that he will listen with great care to my conclusions, because he is wrong. He will be on the spot and I will watch him to see what he does.
This is hardly a new subject, but it is vital. The social chapter, the agreement attached to the protocol on social policy, is important to the fate of Britain and Europe. It should not be judged simply in the context of the treaty. It is important because it illustrates perhaps more graphically than any other issue the awesome gap that stands between the Government's vision and ambition for Britain and for Europe and that of all the other European Community countries.
The Tory party's lonely vision of Europe is of a marketplace alone and its myopic ambition is to dominate it by low wages, low standards and down-market, service-based activities. The market exclusively will matter to the Tory party. Commerce will count, money will rule and people will be kept in their place—at the bottom of the rights league.
Every country in Europe has woken up to the reality of the modern world—the terrifying competition to Europe and to Britain from the far east, Japan and even a dynamic and growing United States. All our European colleagues have embraced the philosophy of quality, skills, high standards and up-market, high value-added production. They see that as their only salvation in the new world. They look on in dismay and with disbelief at our Government making a virtue out of competing at the bottom, at the lowest level of any market.
We are fortunate that British business is increasingly rejecting that suicidal ambition and is looking for, and can now find, an alternative, practical set of policies from the Labour party to take the country into a winning and not a sinking position in Europe and the world markets.
This debate is about a totem, not a policy. The objection of the British Government to the social chapter is about Tory party unity and is not about the British national interest. In the Tory party, the conflict between national interest and Tory party unity has always been resolved by putting the British national interest second to the priority of keeping the whole shambles together.
§ Mr. David Winnick (Walsall, North)
On the Labour side, there is absolutely no difference of view between the occupants of the Front Bench and critics over the social policy. If we are to have the treaty—I despise it and do not want it—we might as well have it with the social chapter.
Does my hon. Friend agree that whatever gains—there will be some, but not many—working people get from the social chapter, they will be offset by provisions such as article 104c, which will lead to much more deflation and unemployment, so that many people now in work may be out of work? When one is set against the other—the social chapter against article 104c and the rest—I do not see much gain for the people of Britain as a result of having the treaty.
§ Mr. Robertson
The fact that I do not agree will come as no surprise to my hon. Friend or the House. He has not persuaded his party colleagues, at national executive or party conference level, of his view. Although he is entitled to that view, it must be placed in that context.
Much was made in the debate last night of the decision of the Scottish TUC yesterday in favour of a referendum. 529 Much less was made—indeed, hon. Members were silent on the subject—of the substantive vote on Maastricht at the STUC yesterday when, by an overwhelming majority, a motion critical of the treaty was thrown out. That important fact should be on the record.
§ Mr. Tony Marlow (Northampton, North)
Some on the Conservative Benches are mystified about why Labour Members get so worked up about the social chapter and the opt-out. Supposing the Government changed their mind and signed up. That would mean that when the Europeans were trying to do all manner of daft things through the social chapter and protocol, British Ministers would be there and might be able to prevent them from doing those things. Because of our not being there, those things will happen and, through other routes in the treaty, will be imposed on the United Kingdom. So perhaps the hon. Member for Hamilton (Mr. Robertson) should not be proposing the new clause but should leave matters as they are. The Government will then have social issues forced on them through the treaty, whereas if they are in the thick of things arguing the case, they will be in a position to oppose what is being proposed.
§ Mr. Robertson
For once in his life, the hon. Gentleman is ingenious, though not correct, in arguing the point. I have heard from Conservative Members the argument that matters will be forced on us, so we should not make a fuss about them. New clause 74 will give the hon. Member for Northampton, North (Mr. Marlow) and his hon. Friends a chance to vote on the social protocol and become part of the process by which members of the Government—not the Minister of State, because he will be abandoning the sinking ship once this is over—will be in there fighting for their corner and perhaps be able to do something about the bits of legislation about which we are speaking. Having provided the hon. Member for Northampton, North with that chance, I look forward, at the appropriate time, to being in the same Lobby with him. His ingenuity will then be confirmed and his wisdom will be on display.
§ Sir Russell Johnston (Inverness, Nairn and Lochaber)
I have a totally uningenious but better question for the hon. Gentleman; why are the Government making such a fuss about the social chapter?
§ Mr. Robertson
That is an extremely good question. The answer is as I explained—that it is a totem, an ideological figleaf designed in vain to keep the Tory party together. It has nothing to do with substance. The other European countries—irrespective of complexion, left wing, right wing or middle of the road—all think that the British Government are completely crazy to be making such an issue out of the social chapter. They think that it is plain, reasonable, uncontroversial, simple, straightforward and makes sense in the context of building the single European market. Therefore, the answer to the question can only be, and is, that the Government are fixated by the social chapter as a means—not a very successful one—of keeping the Conservative party together.
This is a new debate for which we are profoundly grateful to you, Mr. Morris, because the subject was debated before. As a debate, it is complementary to, but not a substitute for, the debate on 28 January which was, as my right hon. Friend the Member for Copeland (Dr. Cunningham) said, targeted on amendment No. 27. In the same way, new clause 74 is complementary to, but 530 certainly not an alternative to, amendment No. 74—sorry, amendment No. 27—and what it means. I have always wondered whether, if we added the numbers together, we would arrive at a magical figure; perhaps someone will do that.
I shall outline the differences between amendment No. 27 and new clause 74. My contention is that, although they use entirely different means, they are both designed to achieve the same ultimate objective on behalf of the British people: the accession of the United Kingdom to the social chapter—the agreement attached to the social protocol of the Maastricht treaty.
§ Mr. Ron Leighton (Newham, North-East)
I agree very much with what my hon. Friend has said about the fact that we must have not just a business man's Europe, but a social Europe, a social dimension and a social chapter. Am I right in thinking that, as a result, my hon. Friend will be unable to vote for the Bill's Third Reading without the social chapter?
§ Mr. Robertson
As my hon. Friend knows, I am not in a position to announce a decision on that, because we will not be making a decision on it, yet my hon. Friend should bear in mind that if, by some means, the House chose to wreck the treaty or stop the process of the ratification of the treaty throughout the Community, the social chapter would die, not just for Britain—which has temporarily been deprived of it—but for the whole of Europe and any future Labour Government. My hon. Friend should consider his question in that context.
It is important for the Committee to understand the new clause and the fact that the Government, in a generous surrender, have allowed us to avoid voting on it. Amendment No. 27 will remove the protocol on social policy—with the agreement attached to it—from the Bill and, ultimately, from the Act. Therefore, it would remove the protocol from United Kingdom domestic law.
The Attorney-General and his mouthpiece on that occasion, the Foreign Secretary, came to the House and said, "So what, if it takes the protocol out of British law? It is a double negative and we are not part of it anyway". With a wave of an expensive legal hand, we are told that the treaty can be ratified, the Bill can be enacted and Parliament can be ignored. They said that amendment No. 27 had no legal consequences as we could still ratify the treaty through the royal prerogative, and Parliament's clear voice was not significant. With one flick of the monarch's pen, Parliament was confined to a mere talking shop. But the Attorney-General still said that he wanted to defeat amendment No. 27 and the Foreign Secretary said that he still did not want amendment No. 27. They said that they still did not want it for the sake of neatness and tidiness, and asked us to believe that. We do not.
The reasons of the Attorney-General and the Foreign Secretary have nothing to do with neatness and tidiness, but involve something much more substantial. They still appear to be terrified by amendment No. 27, which mesmerises them. They are relieved each time that it temporarily disappears beneath the waves. They are uneasy each time it rises out of the waves again. Why is that? We know that it is because if the protocol on social policy is taken out of United Kingdom law, they will lose the authority that that protocol gives for the 11 countries of the Community to go ahead and use all the institutions 531 of the Community—the Commission, the Council, the Parliament—which will continue to be paid for by British taxpayers collectively and by the other taxpayers of Europe, to make law that will apply to only 11 Community countries, not 12.
The Attorney-General says that that does not matter: it is outwith the treaty, like the common foreign security policy and the home affairs and justice policy. That is what we are being led to believe, but it is not true. If that permission is not enshrined in British domestic law, the Government of this country will be in a real legal stew, in a limbo of litigation and potential litigation in the courts of this country and in the courts in Strasbourg as well.
It is our belief—this is why we are interested in amendment No. 27, insist on it and are confident that it will be debated on Report—that one of the consequences of that legal mish-mash could be that the European Court of Justice or the courts of this country will say that, even without the protocol being enshrined in British legislation, it is impossible for the legislation coming out of the agreement attached to the protocol to apply only to 11 countries in the Community; it must apply to all 12 and, as a consequence of that, the people of this country will enjoy the legislation that arises from the social chapter and the rights and protection of the social chapter.
That is why we believe that amendment No. 27 is important, different and must be debated and decided upon by the House.
§ Mr. Michael Spicer (Worcestershire, South)
I have been listening very carefully indeed to what the hon. Gentleman is saying. I understand the logic of what he says, but, if all that is true, why did Her Majesty's Opposition put down these extra new clauses that we are debating, which, leaving aside a whole lot of arguments, at the very least have confused the issue of amendment No. 27? At the least, they opened up the possibility that it would be assumed that these new clauses would be substitutes for amendment No. 27. What was the point? If amendment No. 27 is so important, why not leave it at that?
§ Mr. Robertson
The hon. Gentleman writes thrillers, and I once read two thirds of one. They are all based on highly convoluted and usually incredible plots. I do not know whether they sell. I do not know whether any other hon. Member has ever read one of them. The right hon. Member for Watford has, of course, because he is part of the same sort of conspiracy theory. He is right in the middle of the spider's web, although unfortunately falling off it at the moment.
The hon. Member for Worcestershire, South (Mr. Spicer) writes these thrillers—although they are not nearly so good, by any manner of means, as the fiction of the Foreign Secretary, which has been reaching very realistic proportions in recent days—and he wants to believe that there is some sort of conspiracy here. Alone among the sceptics even, he holds to that conspiracy theory, which he thumps into me every time we meet in the Tea Room. But he is absolutely, completely and totally wrong, although I do not know how he will ever be persuaded that he is wrong.
§ Mr. Robertson
I will give way to my hon. Friend in a moment, after I have disposed of the thriller writer.
Amendment No. 27 was tabled when the Labour party believed that it was the only way in which the Committee could deal with the social chapter. But along came two of the most senior Ministers in Her Majesty's Government, the Attorney-General and the Foreign Secretary, who told us that the outcome of amendment No. 27 did not matter because they were going to ratify the treaty come what may. We were told that the House of Commons could pass comment on amendment No. 27 and could therefore pass comment on the social protocol, but that it was of no consequence. The Government would notify Rome after Third Reading and Royal Assent that the treaty had been ratified and Maastricht was in place.
The BBC, ITN, The Times, The Guardian and The Independent all said that Labour's fox was shot and that Labour's chances of achieving the social chapter had gone. The press believed what it had been authoritatively told by the Attorney-General and the Foreign Secretary. At no point did we ever lose our faith that the Attorney-General was not telling the whole truth. So we tried to find a complementary way, an additional way, thinking at the time that amendment No. 27 was in the bank. It had, after all, been debated by the House. It stood in the name of the Leader of the Opposition. We had talked about it; we had said we would move it; it was in the bank. We looked then for another way to make sure that the people of Britain got the benefits of the social chapter.
Yesterday we had a long debate on the judgment of the Chairman of Ways and Means—I have no intention of going over it again. The deputy leader of the Labour party and the shadow Foreign Secretary have made clear why we disagree with the judgment, based as it was on the idea that amendment No. 27 and new clause 75 were alternatives, not absolutely different ways of achieving the same objective. That is how the dilemma has been created. If the hon. Member for Worcestershire, South wants to look for a plot or conspiracy, let him look along the corridor where the Chairman of Ways and Means sits, not at the Opposition Front-Bench team.
I shall tell the hon. Member for Worcestershire, South why new clause 74 is the ticking timebomb that I said it was and how it may blow up under him if he is not careful.
§ Mr. Michael Spicer
This is rather interesting. The Opposition are saying that they have been the victims, set on a false trail by the Attorney-General. The hon. Gentleman's case today has been logical, but he is also claiming that he went off on a false trail, trying to find other ways of tabling amendments because he had been duped by the Attorney-General—or at least led astray by him.
That is an extraordinary admission by the Opposition. Surely the hon. Gentleman did not need to take advice to know that amendment No. 27 would have the effect that he has described; otherwise, he would not have tabled it at all. It is extraordinary of the hon. Gentleman to claim that just because the Attorney-General said that amendment No. 27 was useless he had to rush off on a false trail. That is very weak opposition—or perhaps there is an ulterior motive behind all this.
§ Mr. Robertson
There is no way in which I can ever persuade people who write mystery novels that the conspiracies they believe in are merely the product of their own tortured minds. There is no conspiracy. The Opposition are trying to get the social chapter for the people of Britain. If the hon. Gentleman wants to wreck Maastricht, he can do that with one amendment that takes out part of the treaty. That would render it impossible to ratify the treaty, so why did he and his hon. Friends table about 500 amendments if not to multiply the chances that one of them would be successful? Perhaps the conspiracy lies here: why are the Conservative rebels using their power so diffusely? Why are they scattering their shot across the spectrum instead of concentrating it forensically on the best chance that they might have of wrecking the treaty? We were just multiplying our chances and using two different ways of approaching the problem.
I do not know what the motives of the Conservative rebels are. They call themselves patriots. They can be described in many different ways. No amount of abuse that I could heap on them could resemble the abuse heaped on them by their fellow Conservatives. Neither do I care about their motives. Sometimes some of them seem to want to embrace the social protocol and chapter, although I know that the hon. Member for Southend, East has as much affection for the social chapter as he has for the "Kama Sutra", but supporting it occasionally seems to suit the rebels. [Interruption.] If there is another answer, I am sure that the hon. Gentleman will tell us himself. There is certainly some mystery about how he got his knighthood, but that has nothing to do with the "Kama Sutra". The motives of these Conservatives will have to be defended by them.
§ Mr. Salmond
We are speaking, of course, with hindsight, but does the hon. Gentleman now regret tabling new clauses 74 and 75, given what has happened? If Parliament is to be denied, as it unfortunately might be, a meaningful vote on the social chapter, does he think that he might regret not taking the opportunity yesterday evening of pursuing the social chapter by means of the referendum clause?
§ Mr. Robertson
I do not regret tabling new clauses 74 and 75 with my hon. Friend the Member for Ashfield (Mr. Hoon). Neither with hindsight nor with foresight do I regret what was done last night, but, with hindsight, I am sure that the hon. Gentleman bitterly regrets tabling on 2 December last year a new clause that made no reference whatever to the social chapter. Today he goes parading around Scottish television studios, going on and on about the social chapter, but it will be clear to the people of Scotland that the SNP has no interest in workers' rights or protections—but every interest in wriggling off the hook on which SNP Members have been dangling since the day thay voted with the Government on the Committee of the Regions.
§ Mr. Robertson
I was voting against a new clause calling for a referendum, in line with what my party has been saying for more than a year. The hon. Gentleman tabled 534 an amendment to that new clause last Thursday; he now claims that his strategy is the apotheosis of consistent attempts to ensure that the people of Scotland get the social chapter. They did not believe him last month about the deal done between him and the Government, and they will not believe him today either.
§ Mr. Robertson
I have given way generously to the hon. Gentleman, but the limits of my generosity have been reached.
New clause 74 is absolutely clear. There will be a final vote after this treaty has finished its parliamentary progress in the Commons and the Lords. There is, apparently, still some legal doubt about whether that will take place before or after Royal Assent—no doubt someone, somewhere will resolve the matter; it is not important—but before ratification of the treaty there will certainly be a vote on a resolution tabled by a Minister of the Crown considering the question of adopting the protocol on social policy.
Among the final provisions of the Maastricht treaty we read, under title VII, article R:This Treaty shall be ratified by the High Contracting Parties in accordance with their respective constitutional requirements. The instruments of ratification shall be deposited with the government of the Italian Republic.Like many people, I am uncertain why we have to deposit ratification with the Government of the Italian republic, which is experiencing certain problems at the moment. Indeed, it may shortly not exist or exist only in absentia. The treaty cannot even start its journey until Parliament has decided on the adoption of the protocol on social policy. I hope to be able to persuade the Committee of the merits of new clause 74. My hon. Friend the Member for Ashfield, who is one of its architects, will underline that argument. The conspiracy theory novelist has now left the Committee and will not hear the final chapter of the story. No doubt he has departed so that he can keep the conspiracy alive in his mind.
There will be a vote on the protocol on social policy before ratification. The cynics will say that, like the fault that they all perceived in new clause 75, which had to do with its preamble about the transfer of powers, the Government will simply ignore it. There may be some justice in that claim because in the dying days of his ministerial career the Minister of State, Foreign and Commonwealth Office, the right hon. Member for Watford, who has been wandering the corridors, an activity which has filled most of his ministerial career up to now, slightly overplayed his hand on Thursday. I think that he was described by Mr. Ian McWhirter in Scotland on Sunday as too clever by half. The right hon. Gentleman did not simply say that new clause 75 would be accepted and that it was a great concession to allow Parliament to have a vote, but he started to imply that if there were a vote it would be ignored.
§ The Minister of State, Foreign and Commonwealth Office (Mr. Tristan Garel-Jones)
Will the hon. Gentleman give way?
§ Mr. Robertson
If the right hon. Gentleman will hold his patience for a moment until I have given him the case for the prosecution, I shall let him offer his defence.
In Friday's Financial Times Mr. Philip Stephens, in a story entitled:
535 "Major squares up to social chapter challenge", said that the timing of the vote on new clause 75,left ministers free to float the possibility—fiercely rejected by the opposition parties—that at this late stage in the ratification process the government might simply ignore a defeat and press on regardless.Of course, that may just have been in Mr. Stephens' imagination, although he is a man of some distinction, character and reputation, as I am sure the Minister would agree. Even The Guardian story on the same subject whose reporters went to the same Lobby briefing said in an article by Mr. Patrick Wintour:Ministers were also intimating that even if a majority of the Commons voted for the social chapter in the subsequent debate under clause 75, the Government would not be bound by that vote, or that the very next day they would defuse the issue by tabling and winning a motion of no confidence.The conclusion of one Lobby correspondent that Ministers were floating that possibility might well be an aberration, but two distinguished Lobby correspondents carrying the story tends to suggest, even without a conspiracy theory at the back of one's mind, that that is precisely what was going on in the corridors last week.
§ Mr. Garel-Jones
The hon. Gentleman is repeating an allegation made by his right hon. Friend the Member for Copeland (Dr. Cunningham) extending not only to me but to No. 10 Downing street and to my right hon. Friend. He cannot and will not substantiate it.
§ Mr. Robertson
Apparently Lobby briefings do not even exist. They are like the officials in the Box to whom we are not even allowed to refer. I withdraw any direct accusation and merely ask the Committee to reflect on the fact that two distinguished and normally reliable Lobby correspondents happened to come to the same conclusion.
§ Mr. Garel-Jones
I am telling the hon. Gentleman, as a matter of fact, that no such briefing was given by No. 10, by my right hon. Friend or by me.
§ Mr. Robertson
The Minister can take that up with the individuals concerned. If he is as outraged as he was last week and as he appears to be today, I presume that he has taken it up already with those people and their newspapers; otherwise hon. Members will be driven to certain conclusions. We have heard the Minister's views and his defence is now on the record.
Whatever Ministers or distinguished journalists have said about the deficiencies of new clause 75, it is now in the past, because new clause 74 is markedly different. New clause 75 had some ambiguities, which were pointed out by notable experts who wrote to us, but new clause 74 has no such highlighed ambiguities. It is absolutely clear cut and says that there will be no ratification until Parliament has made a decision.
I shall tell the hon. Member for Worcestershire, South and some of my hon. Friends who read certain newspapers why the clock is ticking in the bomb. The Minister agrees that a motion will be presented about the protocol on social policy. It will be open to the Opposition to table an amendment to that and, under the precedents of Parliament, the Opposition amendment will be accepted for debate. The Leader of the Opposition's amendment will make it clear that the Government will not have the permission of Parliament to ratify the treaty on European 536 union unless they subscribe to the agreement attached to the protocol on social policy. That is the ticking clock, and it should be obvious to any Back Bencher or journalist.
The Minister of State or any other anonymous Minister who may have been briefing the press last week about walking away from decisions will not be able to say that they can walk away from that. The Minister said that he would walk away from the defeat on the Committee of the Regions when he wrote last week to the chairman of the Association of County Councils. His letter stated:Equally, the amendment passed on this subject on 8 March limits membership to elected local government representatives and I have told the Committee that we do not rule out that approach either.The Minister is saying that the Committee has decided and that he will consider its decision as one of many options. However, the Government will not be able to wriggle away from a decision on an Opposition amendment to the motion that will arise from new clause 74.
§ Mr. Robertson
No. I said that I had reached the limit of my generosity with the hon. Gentleman and I am probably reaching the limit of the Committee's tolerance. I want to finish making my case and allow other hon. Members to participate.
That places the hon. Members for Worcestershire, South and for Billericay (Mrs. Gorman), who are in their places, in a spot. What will they do in that debate and who will they believe? They can believe me because I maintain that the Government, and certainly the Foreign Secretary, would not dream of walking away from the treaty, wrecking it for the 12 Community countries and taking all the opprobrium that would attach to this country from Europe and beyond, solely on the basis that their Parliament had decided to disagree with the social chapter opt out. They would rather sign up to the social protocol because, after all, it is not an issue of controversy for anybody else in the Community. The Tory rebels can believe me or they can make up their own minds or believe the Chancellor of the Exchequer, although I know that that is stretching their credulity to the limit.
§ Mr. Robertson
Dead bodies apart, let me tell the hon. Gentleman and his hon. Friends this. On 16 March, in the Budget debate, the Chancellor of the Exchequer, the second or third most senior member of the Government, saidNothing would do more damage to job prospects, not just in Britain but across Europe, than the imposition of further tax or regulatory burdens on employers. That is why this Government will never sign the social chapter."—[Official Report, 16 March 1993; Vol. 221, c. 170.]He is the only Minister, of any rank, who has used those words. We have checked and others have checked.
If hon. Members believe the Chancellor—
§ 5 pm
§ Mr. Robertson
The hon. Gentleman is in a small minority there, but I am asking whether he believes the Chancellor in this case. I should like to ask the Foreign Secretary, who is with us today—I duly compliment him on that—whether he agrees with what the Chancellor has said.
§ The Secretary of State for Foreign and Commonwealth Affairs (Mr. Douglas Hurd)
Perhaps I will have the opportunity to catch your eye later, Mr. Morris.
§ Mr. Robertson
The opportunity was there. Those were the words used by the Chancellor. The Tory rebels can look at them to see whether they believe those words or believe me. They have the choice, and they will have to make a decision. They will be on the spot. The decision will be for Parliament, and Parliament will make that serious decision. The bomb is, therefore, still ticking.
I have not devoted enough of my speech to the issues of the social chapter; perhaps I should have done, as they are important to our country. However, many of them were covered in the previous debate and if my hon. Friend the Member for Gateshead, East (Ms Quin) catches your eye, Mr. Morris, later in the debate, I hope that she will be allowed to comment on some of the views that will be expressed.
The issues are important. This is a new debate. These are new issues. This is a new clause. This is an historic occasion, although it is not attended by many Members. As there is to be no vote at the end of the debate, people have left the Palace of Westminster quicker than if they had heard the fire alarm. But the crunch will come later, not just for the Committee, not just for the House, but for the country as a whole. The social chapter matters to Britain. The social chapter, with Britain acceding to it, matters to the future of Europe. We have provided the means by which Parliament can give the social chapter to the people of Britain, and I hope that they will take it.
§ Mr. Hurd
The hon. Member for Hamilton (Mr. Robertson) is obviously smarting under the bitter accusations heaped on him last night and in the small hours—that he should not be speaking for his party and that he was in collusion with the Government Front Bench—and he has tried to respond to those accusations. If it is any consolation to him, I can confirm what he probably wishes to hear: the Government feel that the hon. Gentleman has been deeply difficult and obstructive on procedure and substance throughout the course of the Committee. [HON. MEMBERS: Oh!"] Well, look at the procedural votes on which the progress of the Committee has depended—the Liberal Democrats have been up and down and in and out of it, but the Labour party has been consistently unhelpful.
The hon. Gentleman's line, and the procedural delay on which the Labour party insisted, are causing increasing puzzlement and dismay among his friends in Europe, who are linked to him by his many past declarations, because it seems to them, and to us, that the social chapter is, for those on the Front Bench of the Labour party, the prime issue: the cart is more important than the whole, and it is more important to fasten the social chapter into the legislation implementing the treaty than it is to ratify the treaty. All the other elements in the Labour party's view of Europe, and in the hon. Gentleman's view of Europe, seem to become insignificant in his mind beside the absolute importance of loading fresh burdens on to British business through the social chapter and reducing job opportunities. That seems to be the Labour party's European priority.
The hon. Gentleman spent some time on amendment No. 27. All that I can do is to encapsulate and summarise what the Attorney-General, the Lord Advocate, the Minister of State and I have said in the past—that if the 538 protocol were excluded from domestic law, it would still stand in the treaty. Britain could still ratify that treaty because the protocol imposes no burdens on the country which require domestic legislation. I am sure that the hon. Gentleman will agree that that is a summary of what I have said—acting, as he politely put it, as the mouthpiece of the Attorney-General in February. That remains the position.
We took the line then, as we might do on some future occasion if need be, that amendment No. 27 is undesirable and, while incorporation of the protocol into domestic law is desirable for the sake of completeness and clarity, it is not essential. I do not think that I or my colleagues on the Front Bench have anything more to say about amendment No. 27.
§ Mr. Marlow
I am grateful to my right hon. Friend. If the House were to vote for amendment No. 27, it would be voting to exclude the social protocol. The social protocol says that European institutions, and therefore costs, can be incurred for 11 countries. If the House were against that expenditure, how would they then be able to spend that money?
§ Mr. Hurd
I can answer that point, on which I have corresponded with my hon. Friend the Member for Southend, East (Sir T. Taylor). It would be possible, under existing legislation, to absorb those costs. I will read out the formula in the answer that I gave to my hon. Friend. If, as is probable, the administrative costs are included in the Community budget, the United Kingdom would charge its contribution direct on the Consolidated Fund under section 2(3) of the European Communities Act 1972. Payments to the budget are required by the own-resources decision and its implementing regulation and are therefore an obligation to make payment to the Community for the purposes of section 2(3). If, on the other hand, the Community budget is not used—we think that it would be, but we cannot be sure—any expenses would be met by voting moneys on the appropriation account alone, which is the practice for payments to other international organisations to which we belong. We believe—again, on legal advice—that there is legal scope for payment of the administrative expenses to which my hon. Friend referred, if there were any.
§ Mr. Marlow
I put it to my right hon. Friend again. The House has said "No, do not spend that money." How then, whether legally or in conscience, can the Government go ahead and sanction such expenditure when the House has said no?
§ Mr. Hurd
The House will not have said no. If amendment No. 27 or something to that effect were ever passed, the House will have said no to the incorporation of the protocol in domestic law. It would not have affected the treaty, and the protocol does not impose any obligations on the country which require a change in our domestic legislation. Therefore, although we have always made it clear that we find amendment No. 27 undesirable, its passage would not have prevented ratification of the treaty.
§ Mr. Denzil Davies (Llanelli)
As I understand it, what the right hon. Gentleman has said is that the Community budget would take care of the administrative expenses if amendment No. 27 were carried. If only 11 of the 12 countries were under an obligation to make those payments for social protocol, how is it possible to use the 539 Community budget when only 11 countries are under an obligation to impose the payment on the United Kingdom? That would not be a Community budgetary obligation.
§ Mr. Hurd
It is not clear that there would be expenses. Secondly, it is not clear how one would sort out administrative expenses from the other expenses of the Community. We are talking about wages and salaries, a portion of electric light bills, that kind of thing. In practice, it would not be possible to separate them out. The treaty is clear as to how that would fall. It is a reasonable arrangement and, as I have already explained, it has legal cover.
I should like to spend a little time on the substance. The hon. Member for Hamilton did not do so, and up to now I have not done so, but it is a crucial point and will become relevant if the new clause is accepted and we move later, as the hon. Gentleman said, to a debate on its substance.
§ Mr. Michael Spicer
Before my right hon. Friend moves away from the legalities, can he give the Committee the benefit of his advice on what the Government think the legal effect would be if the Opposition's new clause is passed and a motion is tabled? Does my right hon. Friend believe that that would inhibit the passing of the treaty into law?
§ Mr. Hurd
I shall return to that point before I sit down. We believe that the exclusion of the social chapter from the amendments to the treaty of Rome, made at Maastricht, was an important negotiating achievement. We believed then that it would be wrong to accept what our partners wanted. We believe now that it would be wrong to do so. The arguments, which were pretty clear to us in 1991, have become abundantly clear to the world since then.
There should be a social dimension, which looks back to the legislation that this country has passed to protect workers against exploitation, to ensure their health and safety at work and to give workers some rights. The mechanisms are in place both in this country and all over Europe. But the state can afford those social costs, which face all countries, only if it benefits from a successful economy. Money has to be generated by the business sector, because we cannot legislate for increasing living standards. Competitiveness, therefore, is the key. It is precisely the decline in competitiveness and the danger to competitiveness in Europe which makes the case against the social chapter.
We shall continue to argue for and support a sensible social dimension for the Community, but it has to give proper weight to the different national traditions and, now, to the principle of subsidiarity in article 3b of the treaty. I ask my right hon. and hon. Friends, and also the Liberal Democrats and others not besotted with this matter, to remember that it would be foolish, given what is happening in the world economy, to propose an enlargement of the opportunities for centralising legislation in this area. It should be a question not of how to ensure precisely the same levels of social protection in each member state but of how to ensure that Europe can compete effectively on the world stage.
§ Mr. Hurd
I shall give many examples.
The problem is not the extent to which jobs are moving from France to Britain, or from Britain to France—the flow goes both ways, and between other partners as well—but how to prevent jobs leaving the Community altogether. If unemployment is the biggest source of poverty in Britain today, the same is true across Europe. If we are uncompetitive, we create unemployment. European competitiveness is declining. Since the mid-1980s, EC exports in world markets have fallen by 3 per cent. In the 1980s, the Community had trade surpluses with the United States and Japan. These have now become trade deficits.
§ Mr. Hurd
My hon. Friend applauds. I hope that he will continue to applaud all the way to the conclusion that no one on this side of the House can possibly support the social chapter.
On labour costs, hourly wages in manufacturing in leading Community countries are not much higher than those in the United States, but it is the high proportion of non-wage costs—of social security payments—that makes the difference. Those elements make up about half the total labour costs in Germany, France and Italy. In the United States, they make up about 25 per cent. and in countries such as Korea and Taiwan about 10 per cent. That is the main reason why overall labour costs in France, Germany and Italy are higher than in Japan and the United States.
Against that background, it is no wonder that industry is turning increasingly to manufacturing outside Europe. That should be the main concern of those responsible for either national or Community policies in this area. It has not been so, but it should be now.
§ Sir Peter Tapsell (East Lindsey)
On the level of unemployment inside the European Community, which is a matter of deep concern to us all, almost everybody both inside the Community and outside it takes the view that this very high unemployment has been caused largely by the opertion of the exchange rate mechanism, which is an essential instrument of the European Community and likely to continue to be so. Without going into the overall merits of the social chapter, the industrial costs that the Foreign Secretary quoted are extremely misleading. As I am sure he knows, in countries such as South Korea, Japan and Taiwan, corporations and industries provide an enormous number of social benefits for their workers—work security, housing, play schools and education both for children and for grandchildren if a breadwinner is killed. Those statistics do not appear in the national figures for those countries, so the figures that my right hon. Friend quotes are not comparable.
§ Mr. Hurd
Europe's decline in competitiveness—I do not believe that my hon. Friend will deny this—is an established fact. He referred to Japan. I am less concerned about Japan at this time than I am about the newly industrialised countries of Korea, Taiwan and Malaysia, for example, where the factors that he mentioned do not apply nearly so strongly. It is from those countries—the new tigers of Asia, as it were—that the main threat to European competitiveness comes.
§ Mr. Geoffrey Hoon (Ashfield)
The right hon. Gentleman used the provision of social security to illustrate the difference between the European Community and the United States. As the protocol on social policy requires unanimity on social security, does he accept that that does not change in any respect whatsoever the existing treaty provisions which the Government support?
§ Mr. Hurd
The case made by the hon. Member for Hamilton when he answered, for example, the question put to him by his hon. Friend the Member for Newham, South (Mr. Spearing) was precisely that the social chapter would provide the opportunity for increasing social costs. That is the charm of it for the Labour party and the danger of it for people who see the unemployment dangers facing Europe.
§ Mr. Leighton
It is true, as the right hon. Gentleman says, that western Europe has massive unemployment and is facing zero growth, but that has nothing to do with the social chapter. As the hon. Member for East Lindsey (Sir P. Tapsell) pointed out, it is because of the exchange rate mechanism that there are extremely high interest rates. In France it is 12 per cent., with inflation at about 2 per cent., so the real interest rate is 10 per cent. Where can we earn anything like that? That is why western Europe is going into recession. In both the United States and Japan, interest rates are 2 or 3 per cent. That is the reason for the recession in western Europe. It has nothing to do with the social chapter.
§ Mr. Hurd
I have given facts and figures. My hon. Friend the Member for East Lindsey sought to qualify them as regards Asian countries, where social costs are carried by companies rather than by the state, but that does not undermine the basic argument. I do not ignore the exchange rate argument. We have argued it over and over again in this Committee. The exchange rate mechanism, as we know, was invented before the treaty of Maastricht. Because we have debated it over and over again, we know exactly the status of stages 1, 2 and 3 of economic and monetary union. I am not arguing about exchange rates. I am arguing about another danger—the danger to the competitiveness of Europe. That is common ground now among commentators, to a much greater extent than it was when the treaty of Maastricht was signed and when my right hon. Friend the Prime Minister achieved this opt-out. Statistics show that the rise of competitors in the far east has become more apparent in the intervening months, so the case against the social chapter is that much stronger.
§ Mr. Hurd
May I get on a little? I shall give way to the hon. Gentleman later.
I fear that the Labour party is in a groove on such matters, and does not listen to what industry in this country says, but at least it is consistent on the matter. The Labour party has taken that view all the way through. As I have said, its main activity throughout the Committee stage which is now coming to an end has been precisely to seek to impose those extra burdens on our economy.
I find the attitude of the Liberal Democrats more puzzling, because their leader was clear at the outset. A few days before Maastricht, looking ahead as is his wont, he warned that the social chapter couldlead to a form of Euro-sclerosis".542 He said that it wasa really worrying attempt by Europe to try to rebuild in Britain the things that we have dismantled over the last twelve or fifteen years".He also warned—perhaps he went a little far on this point—that the social chapter would open the way for collective bargaining arrangements that weretoo inflexible, too costly, and too rigid".Despite all that, however, the right hon. Gentleman said that he would have been prepared to sign up to it at Maastricht.
The sceptical approach that the Liberals took to the social chapter at that time has changed. I hope that their spokesman will explain why.
§ Mr. Hurd
No, their attitude changed even before Newbury. I do not understand why the social chapter as a cause, and the amendments which flow from it, have become almost as much of a fetish for the Liberals as for the Labour party. I say "almost" because I do not think that it is quite so much of a fetish for the Liberals, who retain a wider view—I might almost say an exaggerated view—of the importance of moving towards a more united Europe. I ask them to reflect on the consequences of the social chapter and to ask themselves why, in view of their philosophy and of their leader's original analysis, they are now so enthusiastic about it.
§ Mr. Hurd
I have given examples of the reasons why I believe that, against the background of the economy of this country and of Europe, it would be great foolishness for us to throw away the arrangement that the Prime Minister negotiated, which is in the treaty that the House is considering and that the Government wish to ratify.
§ Sir Teddy Taylor
We have been asking in debate after debate, week after week, whether any Minister could give us any example of anything that the EC could do under the social chapter which it cannot do under the health and safety provisions of the Single European Act and article 101A of the treaty of Rome. As this is the last debate, and as the Foreign Secretary said that he would give us examples, may I plead with him to give us any example? Apparently the arrangements cannot apply to pay, and cannot apply to trade union membership. Can the Foreign Secretary, or anybody, give us any example of anything that can be done under the social chapter but not under the Single European Act? There is the 48-hour week directive and other things. Can he think of anything at all?
§ Mr. Hurd
The hon. Gentleman's case is that those evils—he admits that they are evils—can come upon us anyway through the Single European Act and the health and safety provisions, but he knows that we resist those attempts. He knows from particular examples that we are perfectly ready to challenge that legal basis in the courts. It is true, as my hon. Friend the Member for Chingford (Mr. Duncan-Smith) said earlier in the Committee's deliberations, that there are risks. There have been cases in which things have been pushed through on a legal base that we regard as narrow and inadequate. My hon. Friend has argued that the European Court would sustain those cases. However, my right hon. Friend the Minister of State dealt with that argument by saying that one could no longer make that presumption about the European Court.
543 I accept that the risk exists, and that there have been some cases, but my hon. Friend the Member for Chingford is really saying that because there have been cases of burglars getting in over the back garden fence we should leave the front door open and put a welcome sign on the mat—that is, that we should greatly enlarge and expand the danger of which he complains. I cannot see how that flows from his argument. The social chapter would substantially enlarge the risks and possibilities by greatly widening the treaty base on which such proposals could be made. That is precisely why the Labour party is in favour of the social chapter.
§ Mr. Nicholas Budgen (Wolverhampton, South-West)
May I remind my right hon. Friend of the interesting argument advanced by the Minister of State? He said that the European Court was a political court which had been affected by the new mood of the politicians in Europe, and also much affected by subsidiarity. He said that he would therefore expect the court now to be inclined to rule in a narrow—and, to us, more satisfactory—manner. That was an extremely dangerous thing to say because it suggested that the European Court was a political court. Although at present he approved of its political activities, he gave aid and comfort to those who say that the political mood may change in the future, and when other people complain that they wish to have the social chapter by the side wind, they will be able to use the political court to achieve that end.
§ Mr. Hurd
I am sure that my hon. Friend intends to be helpful. I intend to be helpful too.
The European Court of Justice has jurisdiction over the treaty. It applies the treaty. Of course it has regard to what is going on around it—all courts do that—but my right hon. Friend the Minister of State refuted the argument that inevitably, at all times present and future, the European Court of Justice would be bound to be a centralising influence. He cited examples—two or three, I believe—of recent cases in which that proved not to be true. He was not calling the court a political court and he was predicting how it would operate in the future.
If, despite the wishes of my hon. Friend the Member for Wolverhampton, South-West, the treaty is ratified and 544 subsidiarity becomes part of the law rather than being simply part of the political practice of the Community, that would be more than a nudge; subsidiarity would be one of the basic treaty articles of which the European Court would have to take account, case by case. That is what my right hon. Friend was saying, and that is part of the reply that I give to the questions that I have been asked.
§ Mr. Jenkin
I am grateful to my right hon. Friend for giving way. I can remind the Committee exactly of what my right hon. Friend the Minister of State said:The European Court has, perhaps, traditionally been a centralising institution, expanding the powers and scope of the Community with what I might call purposive interpretations of the treaty. I contend, however, that there have recently been clear signs that the Court is sensitive to the change of mood in the Community".—[Official Report, 27 January 1993; Vol. 217, c. 1057.]So the basis of the security of the authority of this House, by which the Foreign Secretary set such great store in yesterday's debate on the referendum, is dependent on the European Court's interpretation of the mood in the Community.
The Foreign Secretary suggested that the argument on the social chapter was like saying that if the burglar gets into the house once, he will always get in. My right hon. Friend can check the record if he likes, but following his analogy about the burglar's repeated attempts to get into the house, in our arrangements for setting up the opt-out from the social chapter we are letting the burglars into every other room in the house and expecting to maintain sovereignty in our front room. That is not a realistic prospect.
§ Mr. Hurd
What we are doing in the treaty—to pursue my analogy—is to raise the height of the garden fence through the article on subsidiarity that we have discussed.
What the Labour party wants to do—it cannot possibly appeal to any Conservatives—is say, "No, we actually want to leave the front door open and a welcome sign on the mat", so that all these provisions, however damaging and expensive, can be imposed by the Community.
I will give an example. The agreement of the 11 on the social protocol allows for a wide range of legislation on social affairs, by qualified majority voting, which is far wider than in the present treaties. That is the whole point for Labour. In particular, it allows improvements in the working environment to protect workers' health and safety, working conditions, worker participation in decisions on working conditions, workplace facilities, atypical work, working patterns, employment rights, redundancy payments and unfair dismissal rights. There is a very long list. This is what I mean about leaving the door open and a welcome sign on the mat. It is a welcome sign for Community backing and validity to proposals along these lines, which go much wider than those in the existing treaties.
§ Mr. Marlow
May I draw my right hon. Friend's attention to a statistical fact? If you have a high garden fence, you are more likely to be robbed than if you have a low one.
§ The Second Deputy Chairman of Ways and Means (Dame Janet Fookes)
Order. Before the hon. Gentleman makes his intervention, let me say that, by and large, interventions have been increasingly long during the short time that I have been in the Chair today—with the exception of the last one. I ask that they be short and snappy.
§ Mr. Budgen
On 27 January, my right hon. Friend the Minister of State said:the court is sensitive to the change of mood in the Community"—[Official Report, 27 January 1993; Vol. 217, c. 1057.]A non-political court is bound by precedent and law, but not by the mood of the Community. What my right hon. Friend was saying is that this is a political court because it is, in his words,sensitive to the … mood in the Community.
§ Mr. Hurd
My hon. Friend is a lawyer. Does he know of a court, in this country or elsewhere, which is not sensitive to the mood of the community? My hon. Friend should not wriggle in this way. He said that my right hon. Friend described the Court of Justice as a political court: that means that the court is either composed of politicians, or acting on the basis of political consideration. He now seeks to justify that on quite a different basis by saying that the court is sensitive to what goes on.
§ Mr. Hurd
I think I have made my point. My hon. Friend has moved his position substantially in the last 15 minutes, and he is now making the grave accusation against the European Court of Justice that it is actually sensitive to the world in which it lives, an accusation which is made—and should be made—against any court of law. I do not think that he has sustained his point at all.
§ Mr. Spearing
I am grateful to the Home Secretary for his characteristic courtesy and thoroughness. May I take him back to what he has called the "social chapter", although really it is the "protocol agreement" in the treaty? He said that there were three views on it. I suggest that there is a fourth—the exaggeration as to the damage on the one hand and the benefits on the other.
The "damage", as understood by my hon. Friend the Member for Hamilton (Mr. Robertson), is greatly exaggerated. Article 2.2 says:Such directives shall avoid imposing administrative, financial and legal constraints in a way which would hold back the creation and development of small and medium-sized undertakings".546 Does not that requirement mean that the vast number of employed persons will not be within the requirements of the social agreement, and therefore the exaggerations of both the right hon. Gentleman and my hon. Friend will not be so great as they suppose?
§ Mr. Hurd
I am not sure what case the hon. Gentleman is making. He is speaking from the Opposition Back Bench. He—perhaps less than his Front Bench—has devoted himself, night after night, to forcing this change upon the House and the country. Now he is saying that the damage is negligible. What is all this about? Why is the Labour party subordinating everything to this cause if it is really of no importance? The hon. Gentleman has a wise influence over these proceedings, and yet he is contradicting and completely destroying the case made by his own Front Bench.
§ Mr. Hurd
The hon. Gentleman says that we are both exaggerating. I have made the case based on the competitive threats to this country and to Europe, based on the policy of the open door and the welcome mat that the social chapter would create for dangerous propositions for this country. In response to the persistence of my hon. Friend the Member for Southend, East, I have given examples of what might occur.
§ Mr. Randall
I apologise, first of all, for missing the beginning of the Foreign Secretary's speech. In relation to the burden to which he has referred, I had a meeting the other day with a number of directors of a large multinational company. They told me that they thought that the burden to which the Foreign Secretary refers does not really apply, because most of the companies with a modern management outlook actually did a lot of these things. They felt—this is an example of the attitude of that particular business—that we were making an awful lot out of nothing, and that it was nothing more than a political totem pole.
§ Mr. Hurd
That is not the view here or the view of the Confederation of British Industry, or that of people to whom I listened in Japan, Korea and Indonesia when I was there a couple of weeks ago. There is great anxiety there among European business men about the social costs that Europe is heaping upon itself. There is a considerable realisation among would-be investors and manufacturers in those countries as to where the costs lie and do not lie.
I hope that I have said enough on the substance to show that we are not afraid of this argument. We are not hoisting a white flag of surrender. We have no difficulty in accepting the challenge with which the proposers of new clause 74 present us. It is reasonable that the House should want the opportunity to vote on the principle of the social protocol. New clause 74, which we are debating today, offers such an opportunity. That is why we came to the conclusion that we should accept the new clause, as I advise my right hon. and hon. Friends to do.
We are talking—I think the hon. Member for Hamilton was accurate on this point, although I shall have to study exactly what he said in Hansard—about a vote after the passage of the Bill but before ratification. That will enable 547 the House to vote on the merits of the social protocol itself. We believe in the opt-out, for the reasons that I have explained. Obviously, we have not drafted the motion that new clause 74 would require a Minister to introduce if the new clause were accepted. I do not know what the terms of the motion would be, but the Opposition and the Committee would expect the motion to reflect what I have been saying today and what my colleagues have been saying for a long time. The motion will reflect our view and we believe that that view will prevail.
I will not answer hypothetical questions about what we would do if the motion does not prevail, any more than a party leader on the edge of an election would answer the inevitable questions, "Are you going to resign, give up the leadership or throw yourself under a bus if you don't win?" No, we shall take this one step at a time, as we are doing. If new clause 74 is accepted, we shall abide by it. We shall move a motion connected with the question and we shall put our views robustly to the House between Royal Assent and ratification.
§ Mr. Michael Spicer
On a point of order, Dame Janet. My right hon. Friend the Foreign Secretary was kind enough to say at the beginning of his speech that he would answer my question about the legal effect or impact of the amendment which the Opposition have said that they will table. Inadvertently, I am sure, my right hon. Friend did not answer my question. May he have an opportunity to answer it?
The Second Deputy Chairman
Order. I should make it clear that that was not a point of order for the Chair. Each member of the Committee is responsible for what he says or does not say. No doubt it may be possible for further information to be given at some stage. However, that is not a matter for a ruling from the Chair.
§ Mr. Salmond
On a point of order, Dame Janet. The Foreign Secretary is in danger of misleading the Committee. We all heard him say that he was not answering hypothetical questions about the passage of clauses. I do not know whether you were in the Chair at the time, Dame Janet, but we all heard the Foreign Secretary deal with and elaborate upon the same hypothetical point in relation to amendment No. 27. I am sure that the Foreign Secretary does not want to mislead the Committee by saying that he does not follow hypothetical arguments when he did so only a short time ago in respect of another amendment.
The Second Deputy Chairman
The same considerations apply as I gave in response to the previous point of order. That is not a point of order for the Chair.
§ Mr. Spicer
No. My point of order is whether the Chair will give my right hon. Friend the Foreign Secretary the opportunity to respond. It was not so much the content of my right hon. Friend's speech or what he was going to say 548 as a question of whether the Chair would allow him the opportunity to answer my question. That is a matter for the Chair.
The Second Deputy Chairman
I am quite sure that if the Foreign Secretary wants to intervene at some stage during another speech, he will be able to do so. I am sure that the hon. Gentleman is well aware of that convention.
§ Mr. Robertson
On a point of order, Dame Janet. I crave your indulgence because I have an extremely important point to make. The Foreign Secretary has concluded his preliminary remarks. Although he is not prevented from participating again in the Committee, he concluded without answering one of the key questions to which the Committee wanted an answer and which it seems that the Foreign Secretary is now willing to answer.
In addition, earlier in this Committee the Prime Minister sent a letter to my right hon. and learned Friend the Leader of the Opposition in which he made it clear that the Attorney-General would attend our debates to help the Committee on matters, for example, in respect of the issue about which the Minister of State, Foreign and Commonwealth Office, the right hon. Member for Watford (Mr. Garel-Jones), unfortunately misled the Committee.
The Attorney-General is here and the Prime Minister has said that the Attorney-General can advise the Committee. My question, which is an issue of order, is this: how can the Committee receive the information from the Attorney-General—or from the Foreign Secretary—in response to the crucial question whether the Government are going to accept the outcome of the vote that is consequent on new clause 74?
The Second Deputy Chairman
Order. The hon. Gentleman is pushing his luck. He knows very well that that is not a point of order for the Chair. He has made his point and I suggest that he now resumes his seat and allows the hon. Member for Wallsend (Mr. Byers) to have the Floor.
§ Mr. Stephen Byers (Wallsend)
May I give notice to the Foreign Secretary and the Attorney-General that there will probably be an appropriate point during my contribution when an intervention could be made to address some of the points made by my hon. Friend the Member for Hamilton (Mr. Robertson) from the Opposition Front Bench.
I do not want to delay the Committee too long in its final hours of deliberations, but I believe that certain things have been said about new clauses 74 and 75 which have been misleading and inaccurate, and they need to be clarified. I hope to clarify some of those outstanding issues in a few minutes.
The Committee must recognise that the Government's acceptance of new clause 74 does not come about as an act of generosity. It comes about as a result of the political reality the Government face. Had they not accepted new clause 74, they would have suffered another defeat in Committee.
The acceptance of new clause 74 is a humiliating climbdown for the Government. We know that the Prime Minister wants to put the Maastricht Bill behind him and to look forward to a new future at the heart of Europe. However, new clause 74 ensures that, as the Maastricht 549 Bill leaves Committee, it has a very important item of unfinished business which the House and the Government will have to address at some point.
As the Prime Minister looks towards the horizon, he will see a dark cloud. That is the vote that the House will have on the protocol on social policy as part of the Maastricht treaty. The Prime Minister and the Government will not be able to escape that vote. As each day passes, that vote will get nearer. The acceptance of new clause 74 means that the Government have paid a high price in their endeavour to avoid a defeat on that clause.
As the Committee completes its deliberations, we know that there will be a Report stage, during which we hope to press amendment No. 27. I want to consider the relationship between amendment No. 27 and new clause 74, because I believe that that relationship is very positive and complementary. I hope that the House will have an opportunity to discuss amendment No. 27 at a later stage.
I am conscious that, when hon. Members and commentators have examined new clause 74, they have said that it does not mean very much, because the Bill will have become an Act and will be on the statute book. Therefore, what is the purpose of new clause 74? It is significant, because it means that the Act will not come into force until the House has had an opportunity to debate and vote on the desirability of the United Kingdom's incorporation into the protocol on social policy.
The Act will be a dead duck until we have that vote. The Act on the statute book will be full of fine words and good intentions, but it will have no practical purpose or effect. In many ways, that is a very fitting testimony to the Government's mismanagement of the whole Maastricht process. It will say everything, but do nothing. That is why new clause 74 is so important. It restricts the Government's ability to move forward to the final act of enforcement of ratification of the Maastricht treaty.
A number of Conservative Members and some of my hon. Friends wanted to know why new clauses 74 and 75 were tabled in the first place. They believe that the new clauses are not necessary, and that they in some way weaken our arguments about amendment No. 27. I believe that the reality is quite different, and I want to take this opportunity to lead hon. Members through the reasons behind the tabling of new clauses 74 and 75. Hon. Members know that, if amendment No. 27 is carried by the House, it will remove the United Kingdom's opt-out from the protocol on social policy.
Amendment No. 27 removes the protocol on social policy but puts nothing in its place. In the words of the Attorney-General, it is a double negative and therefore has limited legal effect. We disagree with aspects of that interpretation. We accept that, because of the procedures and rules of debate in Committee, we were able to take things out of the treaty and were unable to put things in. That was the ruling given by the Chairman. If amendment No. 27 is carried on Report—if we have the opportunity to vote on it—there will be nothing left in the Bill which addresses the issue of the protocol on social policy.
A number of hon. Members tabled amendments requiring the insertion of an opt-in—if one likes—to the protocol on social policy. New clauses 9, 68 and 69 sought to do that, but the Chairman did not select them. He did not give any reasons for that, but I understand that the main reason was that he agreed with the precedent that it 550 is not for a national Parliament to insert additional provisions into an international treaty agreed by a number of countries. For that reason, the Chairman felt unable to select and debate any of those proposals.
We were unable to insert an opt-in provision in the Bill, so we had to find another device. New clauses 74 and 75 provide such a device. They are effectively procedural resolutions. Within the rules of procedure, all that we are able to discuss today is the question whether the Committee should have the opportunity to vote on the desirability of the social policy protocol. We will have a vote which will provide the Committee with an opportunity to express its view one way or the other on that desirability. We will then move to a third stage, at which, hopefully, the Government will reflect the views expressed by the Committee in the vote.
Instead of simply a two-stage process, we effectively have a three-stage process. We will have amendment No. 27, which deletes the opt-out; we will have a vote on new clause 74 and a motion tabled by a Minister—we hope that the motion will show that we do not want ratification to proceed without the social chapter; and then the Government will have to decide what they intend to do. In the third stage, the Government will decide how to react to the vote.
§ Mr. Hurd
I do not agree with the hon. Gentleman's comments about amendment No. 27, for the reasons that I have given. However, I agree with the rest of what he said. He has given me the opportunity—he kindly said that I could take it—to answer a question raised by my hon. Friend the Member for Worcestershire, South (Mr. Spicer) and the hon. Member for Hamilton (Mr. Robertson), who is no longer here. They both put the question in a legal form, but it is not a legal question, as the analysis of the hon. Member for Wallsend (Mr. Byers) is showing.
The question related to what we would do in certain circumstances after the debate on the substance, which new clause 74 provides for. I said that we would table a motion reflecting our views on the social chapter, as would be required on this hypothesis by new clause 74. We would debate that motion robustly and we would hope—as Governments do—that it will prevail.
The question is a political one. I am not prepared to answer hypothetically a question about what we would do after that. The hon. Gentleman has listed the sequence of events and has rightly said that, after the debate provided for in new clause 74, the Government should reflect on what they will do. That is correct, and that is what we will do.
§ Mr. Byers
I am grateful to the Foreign Secretary for his comments. He will be aware that the failure to clarify the position—he has been given the opportunity to do so—will create great difficulties. The worry that many of us have about the position in which we will be put is the potential conflict between the will of the majority of the Committee and the total determination of the Government to ratify the treaty at almost any cost.
There is a danger of a constitutional crisis arising if the Government fail to reflect the view of the majority of the Committee. I hope that the Foreign Secretary will use the opportunity, some time during the final few hours in Committee, to say that the Government will abide by the majority view of hon. Members on this issue. His failure to do so up to now is regrettable. Hopefully, he will reflect on 551 the position and set out in a more positive way the attitude that the Government are likely to take if a vote adverse to the Government's position is carried when the House has the opportunity to vote on the motion. A motion will be provided if new clause 74 becomes part of the Bill.
There is no hiding the fact that, for Labour Members, the Maastricht treaty and the social chapter should go together. The importance of that has been stressed time and again. There are political reasons why we want to see that. It will benefit workers by giving them advantages and protection—that point has been well argued by my hon. Friend the Member for Hamilton. There are legal reasons why we need to adopt the social protocol. If we fail to do so, there will be real difficulties. As a nation, we will be open to challenge on constitutional grounds. Our failure to adopt the social protocol will result in discrimination against workers and will infringe the European Community's competition policy.
The Government will be put in a farcical position if we do not adopt the social protocol. At the Council of Ministers, they will have to leave the proceedings when the protocol on social policy is debated: they will not be able to take part or vote. They will go back in when the Council moves off the protocol on social policy, and have to leave again when it is debated again. It will be a case of in and out—it will be a European version of the hokey-cokey. It will be a Brussels benefit for lawyers. Brussels will be able to challenge legally the fact that we are not part of the protocol on social policy. For those legal reasons, it is important that we subscribe to the protocol. There are overwhelming political reasons as well.
Earlier, I said that many hon. Members—and certainly members of the public—found the proceedings complex and difficult to follow during 23 days in Committee. One reason for those difficulties is the complex legal position that is involved in the ratification of international treaties. Governments and Parliaments have distinct roles in the ratification process. The different roles and responsibilities have often been difficult for hon. Members to follow. Article R of the treaty clearly states that it is for each high contracting party to ratify after going through its own constitutional requirements.
That then raises the question: what exactly are the constitutional requirements for the United Kingdom in these matters? The formal and legal position is that all international treaties are ratified by a Minister of the Crown: it is technically done by the Crown acting on behalf of the Government. Constitutionally over the years, the system has arisen by which the whole process is subject to parliamentary scrutiny. Indeed, when the treaty amends our domestic law, that must be provided for in legislation. Different responsibilities are contained in the legal relationship on the question of the ratification of international treaties.
The best and clearest explanation of the differing roles is expressed by Oppenheim in the leading work on international law. On page 1,227 of the ninth edition, it states:the expression 'Parliament has ratified' a certain treaty, though occasionally met with, is objectionable when used of a British treaty. Parliament, if invited to do so, may authorise the Government to ratify a treaty, but it is the Crown, upon the advice of ministers responsible, which ratifies a treaty. Legislation may be necessary to give effect to the treaty, but that is not ratification.552 The crucial point is that Parliament, if invited to do so, may authorise the Government to ratify. But it is the Crown which ratifies a treaty. That is why the Secretary of State must clarify this evening exactly what the Government's response would be to an adverse vote—as they would see it—on a motion tabled by a Minister.
The Crown will act on the advice of Ministers. The Committee should be told exactly what advice the Crown will receive from Ministers if they are defeated when the substance of new clause 74 comes before the House.
§ 6 pm
§ Mr. Marlow
The position is clear. Hon. Members have already referred to the comments of my right hon. Friend the Chancellor of the Exchequer. The Government are a seamless web. They will have no truck with the social chapter. It is clear that, if the social chapter was imposed by means of a motion and an Opposition amendment at a future date, the Government would not be able to ratify the treaty. That is why it is a mystery to Conservative Members why the Opposition are pressing the amendment. We are happy for the new clause to go through, but the Opposition must realise that there is a real risk that, if it does, it will prevent the ratification of the treaty, and it will be their fault.
§ Mr. Byers
I obviously have not explained sufficiently fully and clearly the legal position on ratification of international treaties. It will be for the Government to ratify. That is the position. The Government could ratify the treaty and ignore the will of Parliament, if they chose to do so.
Indeed, it is interesting to note that the Bill before the Committee does not seek the view of Parliament on ratification. The Government could have worded the Bill to seek the view of Parliament. They have not done so. They have not allowed Parliament to express its view on ratification or any conditions which the House may want to impose on ratification. The Government have failed to do that.
However, as my hon. Friend the Member for Hamilton said from the Labour Front Bench, the Labour party will provide the House with such an opportunity, because an amendment to the motion moved by a Minister will allow the House to express a view. As I understand it, it will be worded in such a way as to disallow ratification unless the social chapter is included in the provisions before the House. That is the position as we see it.
We are aware that the Government have sought legal advice on many occasions. Many of us are genuinely worried that they may seek to defy the will of the majority of the House by arguing narrowly and legalistically that ratification is solely a matter for the Government and not subject to the will of Parliament or its approval. That is why we seek clarification. We seek the views of Ministers this evening on whether the Government will abide by the wishes of the majority of the House of Commons.
The Foreign Secretary failed to answer that question earlier this evening. There is a real worry that, if the Government are prepared to ratify the treaty at any cost, they will create a constitutional crisis. The Government will advise the Crown on whether ratification should take place. What advice will they give the Crown if they have just lost a vote on a Labour amendment which says that 553 ratification should not go ahead without the social chapter? The Government are not prepared to answer one way or the other this evening.
The Crown would be put in an impossible position, with the Government of the day perhaps advising one way and a majority of the House of Commons expressing a view the other way. That must be clarified. The Government are condemned by their silence on the matter. That is why, as my hon. Friend the Member for Hamilton said, the new clause is a time bomb ticking away. On a motion tabled by a Minister, the Government will allow the House a debate, but the Leader of the Opposition will table an amendment on which hon. Members will be able to vote seeking to place a condition on ratification.
We believe that the Government will be constitutionally bound by a vote in favour of such an amendment. They may argue that, legally, they can still proceed to ratification. That is the constitutional conflict and dilemma. We face a potential constitutional crisis if the Government ignore the will of the House on the matter.
It has been said that the way in which new clause 74 is worded deals an ace to the Government, because they will be allowed to word the motion that the House will consider. That ace has been trumped this evening, because we have been told how the Labour amendment in the name of the Leader of the Opposition will be worded. The House will have an opportunity at long last of voting on the social chapter. The Government have sought to run away from a vote on that key issue. There will be no hiding place for the Government on that issue, because the Labour party will table an amendment which will allow Members of Parliament to express a view. The Opposition are prepared to ensure that, in the interests of the British people, the House of Commons will hold the Government accountable.
§ Mr. Budgen
I hope that I may be able to persuade the Committee that the exchange between my right hon. Friend the Foreign Secretary and myself touched on a matter of grave importance. Many Conservative Members have made an argument based on the writings of Mr. Martin Howe and others who have examined the treaty with great care. They have said that, sadly, we are likely to have the social chapter by other means whatever happens.
We have then asked the Government to look at the way in which previous treaties have been dealt with by the European Court of Justice. We can anticipate that, when the mood of the court changes back to its previous federalist stance, we shall be caught. Therefore, I am unrepentant in saying that my right hon. Friend the Minister of State admitted on 27 January this year that the European Court of Justice was a political court.
§ Mr. Garel-Jones
My hon. Friend is an extremely distinguished lawyer—I should say my hon. and learned Friend. [HON. MEMBERS: "No."] He is not "learned", but he is an extremely distinguished lawyer. I hesitate to intervene on a lawyer of his distinction. He is what is known as a jobbing lawyer, so he is accustomed to the use of a certain amount of hyperbole.
I did not say at any point that the European Court of Justice was a political court. I observed—my right hon. Friend the Foreign Secretary and my right hon. and learned Friend the Attorney-General happened to be on the Front Bench at the time—that the European Court, like our own courts, is part of the society in which we live. 554 It takes into account the society in which it operates. My hon. Friend seeks to build an edifice that fits in with his fantasies.
§ Mr. Budgen
Sometimes jobbing lawyers have to cross-examine the accused by reference to the statement that he has made to the police. Jobbing lawyers are quite good at using the pompous phrases of the court. I would respectfully suggest that what the accused said on that occasion amounted to an admission of guilt in that he said it was a political court. In his extensive statement to the police he said:The European Court has, perhaps, traditionally been a centralising institution, expanding the powers and scope of the Community with what I might call purposive interpretations of the treaty. I contend, however, that there have recently been clear signs that the court is sensitive to the change of mood in the Community—even in advance of the ratification of the Maastricht treaty, which itself sends out a clear signal through article 3b; that article concerns subsidiarity, which we shall discuss later.The court is showing itself to be increasingly sensitive to states' rights, and is giving increasing weight to the national arrangements."—[Official Report, 27 January 1993; Vol. 217, c. 1057.]
§ Mr. Budgen
I will give way in a moment. I should be sad if I thought that I had in any way stung my right hon. Friend. He seems to have abandoned his laid-back Spanish attitude and is jumping up and down as though he had been stung. That saddens me. I hope that he will allow me to expand for a moment what I am sure he would describe as my fallacious argument.
Where a court, for the sake of argument, is in a state of being relatively unconstrained by legislation, with a wide discretion, for instance, in fining somebody or deciding what sentence of imprisonment should be imposed, it is—to use my right hon. Friend's words—sensitive to the change of mood".
§ Mr. Budgen
I will give way in a moment. If, for the sake of argument, there has been a large number of burglaries in an area and the mood of the populace in that area is very much opposed to burglaries, it is likely that a court, in its relatively unfettered discretion, will impose on a person who has been found guilty of burglary a higher sentence, but that is not the function of the European Court. The European Court is partly an administrative court and partly a supreme court. It is important to understand that it has a quite different role from that of the House of Lords in its judicial capacity in our constitution.
§ Mr. Budgen
I am sorry that my right hon. Friend is behaving as badly as I often do. If he could contain himself for a moment, I should like to expand the point.
If, for the sake of argument, the House of Lords is trying to construe a complicated piece of tax legislation under a Finance Act, it considers the law and the precedents, but emphatically it does not take into account, in my right hon. Friend's words,. "the change of mood". It does not say, "We have construed subsection (b); we notice that there is a public sector borrowing requirement of £50 billion and that there is a major change of mood that people ought to pay more tax; therefore, we shall say that the appellant ought to pay tax under subsection (b)." 555 If the House of Lords did that, it would, in my right hon. Friend's words, be taking account of "the change of mood". That is not the role of a non-political court.
However, if the court is like a supreme court, it moves from being a body which merely interprets the law narrowly into something approaching a law-making body. Once it becomes a law-making body, it can be properly stigmatised as a political court. What my right hon. Friend is admitting is that the European Court has a law-making role. He is rather approving of its law-making role. In his opinion, its mood is moving towards recognition of the rights of the nation states. If it is a law-making body which is responsive to mood change, it might just as well move back into a law-making mode of a federalist nature.
Now I will give way to anybody.
§ Mr. Quentin Davies
My hon. Friend referred to courts unconstrained by legislation. That was the central part of his argument. My hon. Friend is all too familiar with the text of the Maastricht treaty. He will have noticed that one essential feature of the treaty is the principle of subsidiarity. That will constrain, for the first time, decisions of the European Court. The court will not be unconstrained by legislation; it will take account of the treaty. Once Maastricht is ratified, it will have to take account of the principle of subsidiarity. No change in mood, let alone any political direction, is required. The mere fact of subsidiarity will provide greater protection against Community institutions interfering in our national affairs.
§ Mr. Budgen
My hon. Friend ought to read the debates on subsidiarity. He is wrong about that. The importance of the subsidiarity element in the treaty is that it will be taken into account politically by the Commission. It does not have the effect of being legally binding.
§ Mr. Budgen
No. It was put forward initially, mistakenly, as being legally binding upon the court. That is not so. It is a principle which will be taken account of by the Commission.
§ Mr. Garel-Jones
I assure my hon. Friend that he has not stung me, but I have a natural feeling of trepidation in discussing legal matters with a lawyer of his great distinction. To use the term that no doubt my hon. Friend uses when in court, it would be my respectful submission to the Committee that since my hon. Friend, having quoted me as describing the European Court of Justice as a political court, has now been good enough to read out my words, it is clear that I did not describe the European Court of Justice as a political court. I think that I went on to give three examples of judgments by the European Court in the last 12 months which, to me and, I think, to others, seemed to be more sensitive to the rights of nation states than perhaps has been the case in the past.
The Second Deputy Chairman
Order. Before the hon. Gentleman continues, may I inquire how the arguments which he is deploying relate to the new clauses under consideration?
§ Mr. Budgen
Because on all considerations of the treaty, the central power, which will decide the interpretation of anything that we decide to ratify over the treaty, is the court.
It is unusual for us in our constitution to be so concerned about a court. When one has a sovereign Parliament one is relatively uninterested in the occasional ramifications of the courts which may have an effect on what one is deciding. Once one has a written constitution and something above it which is partly an administrative court and partly a supreme court, the role of that court becomes extremely important.
I do not want to be thought to be stung by my right hon. Friend's attempt at sarcasm; nor will I try to compete with him in sarcasm, but he has raised a serious point. By his admission that the court took into account the changing mood of the Community, he was thereby admitting that it was a political court.
§ Mr. Garel-Jones
I am grateful to my hon. Friend for giving me the opportunity to intervene again. It is my contention that British courts also respond to changes in public opinion, not just on levels of fines, as my hon. Friend has implied, but through the establishment of substantial precedent. A good recent example of which the Committee will be well aware is marital rape. Previously, the decisions of the British courts had consistently held that a husband could not, as a matter of law, rape his wife. The House of Lords took into account the changes in public perceptions, or the mood, in our country and reversed that view—a decision which many hon. Members and the public regarded as wise. That did not make the House of Lords a political court, but a sensitive one. The European Court of Justice is also a sensitive court, as we would wish it to be.
§ Mr. Budgen
Sadly, Lord Denning is now retired, but everyone will know that he raised the whole question of what is the role of the courts by many of his judgments. Even he, at what might be described as his most heroic, never suggested that he had a law-making role. He described some of the judgments he gave as being vigorously interpretative, but he would hardly describe himself as having made the law. Under our constitution, Parliament is the place for law to be made.
The decision of our courts on marital rape was an unusually heroic one. It would have been a great deal better, however, if that decision had been made here in Parliament.
§ Mr. Budgen
It is a good point.
The Second Deputy Chairman: It may be a good point, but it is a diversion from the two new clauses that we should be discussing.
§ Mr. Budgen
I did not want to irritate my right hon. Friend and I certainly do not want to irritate you, Dame Janet, but, none the less, the role of the European Court in interpreting the treaty is absolutely central to our considerations.
My right hon. Friend said that that court was susceptible to a change of mood. Whether he thereby admitted that it was a political court is a matter of interpretation, but, by saying that, he admitted that it was a very, very dangerous court with innovative powers, 557 which were likely, when the change of mood went the other way, to act to the disadvantage of the British nation state. Those comments gave aid and comfort to Mr. Howe and others who say that, in the end, the Community will get us on a single currency and the social chapter.
§ Mr. Hoon
The debate on the social protocol demonstrates the difficulties into which the Government got themselves by opting out of the social chapter. Every other Government in the Community regards it as a necessary vital balancing item in the creation of a European single market. The Governments of the left, right and centre recognise the importance of establishing basic standards of social protection in a single market where capital is free to move from one country to another.
Every other European country recognises the importance of establishing minimum standards instead of trying to drive them down. Every other European country wants to develop the skills and expertise of its work force, not to compete with far eastern offshore economies. That is why Labour Members believe that it is so important for the House of Commons to debate the subject again today.
I support new clause 74, for the drafting of which I was originally responsible. I have borne in mind the scorn that has been heaped upon it during the debate on Britain's opt out for the social chapter. The new clause has been described as a sell-out and a Trojan horse. It even provoked a distinguished political columnist of The Observer, who is in his place above the Chamber, to at tack it two weeks running. In effect, new clause 74 led to the discretion exercised by the Chairman of Ways and Means in his selection of amendments.
Why has this rather modest proposal attracted so much opposition'?
§ Mr. Marlow
The hon. Gentleman said that the social protocol would do something for the skills and expertise of the work force. Where is that mentioned in the social protocol?
§ Mr. Hoon
It has always been my view that the higher the standards of social protection, the better developed and better trained the work force will be. They will be able to develop and enjoy more expertise.
New clause 74 has attracted so much opposition because it displaced amendment No. 27 in which so much hope was placed by those who want to see the Maastricht treaty defeated. Those opponents should consider whether they are right to place so much hope in that amendment. It certainly appeared to be significant when the Minister of State bounced up and down and told us that if it were passed it would wreck the treaty. He repeated that assertion on many occasions. It is interesting to note how much more reticent Ministers have been today when expressing their view about the implications of accepting various amendments. Perhaps they have learnt from the right hon. Gentleman's unfortunate experience.
It was precisely because of that unfortunate experience that the Foreign Secretary and the Attorney-General were wheeled out to give the Government's definitive view about the effect of amendment No. 27. They both said that, whatever the result of a vote, the Government would ignore the amendment. The Foreign Secretary repeated that view today. Even if amendment No. 27 were passed, the Government would still go on to ratify the treaty. Whatever the supporters of amendment No. 27 may say in its favour, they must face up to that fact.
558 Whatever the merits or otherwise of the Attorney-General's legal advice—I have grave reservations about whether it was correct—we must deal with the fact that the Government would ignore amendment No. 27 if it were passed. What does that mean? For the opponents of the Maastricht treaty, certainly those on the Conservative Benches, it means that they would go off to the High Court and challenge the Government's position on legal and constitutional grounds. I would have no objection to such a course of action because I believe that it would be beneficial in clarifying some difficult areas of the law on the constitution. I appreciate why they consider that they have strong grounds for such a course of action. I suspect that they have had strong legal advice saying that the British Government should not ratify an international treaty where their domestic legislation to give effect to the terms of that treaty is at variance with the treaty itself. That is a basic proposition which, until the Attorney-General gave us the benefit of his advice, we were taking for granted.
That would be the case if amendment No. 27 were passed. It would leave the matter of the social protocol in the hands of the courts and judges. That may appeal to the hon. Member for Stafford (Mr. Cash), a distinguished lawyer, but why should such an approach appeal to Labour Members? Why should they want to substitute what is essentially a political decision for a judicial one? Why should that appeal, for example, to my hon. Friend the Member for Bolsover (Mr. Skinner)? Would he trust the judges with the social chapter?
That is why it has been important for the Labour party—indeed, for the whole Opposition—to find other ways to tackle the question of the opt-out. That is why new clause 74 was drafted, and I invite all who still have reservations about that clause to look carefully at its drafting and consider its effects.
§ Mr. Marlow
The logic of the hon. Gentleman's remarks is that he would vote against amendment No. 27. Is that correct?
§ Mr. Hoon
On the contrary. I said that I would welcome the possibility of the legal and constitutional questions being resolved because, as I said, I have doubts about what the Attorney-General said. So I hope a way can be found to retable amendment No. 27 or something similar to it. I do not see that amendment as being inconsistent with new clauses 74 or 75. After all, new clause 74 says that the measure may come into force only once the Government have tabled a resolution on the protocol on social policy. So the Government would not be in a position to ratify the treaty without having had the debate.
The Government, and particularly the Attorney-General, should consider the fact that there is no specific commencement date in the Bill. In the absence of such a date, a measure generally comes into force on the date of Royal Assent. So it follows that any further debate on the social protocol is likely to occur before Royal Assent. Little turns on that, because that further debate must take place before ratification, since until the measure is in force, the Government will not have the necessary legislative underpinning in the United Kingdom to give effect to the international obligations in the treaty to which they have signed up.
559 The fact that the Government expressed their willingness to accept new clause 74 led some commentators to suggest that the Government would simply table a motion on the protocol forcing their rebels to toe the line or to table a motion that, whatever the outcome, the Government would ignore. Indeed, the distinguished columnist Alan Watkins wrote last Sunday:The Government can so phrase the motion that even though a vote supporting the social chapter is achieved, there is no obligation to act on it.That may be true of the Government's motion, but it overlooks the opportunity that Opposition Members would have to table an amendment.
My hon. Friend the Member for Hamilton (Mr. Robertson) has been much derided for his description of new clause 75 as a ticking time bomb. There is a way in which the fuse on that may be ignited, and my hon. Friend spoke of a strategy that I had suggested to him. On the Government tabling the resolution required in new clause 74, the Opposition could table an amendment saying, in effect, "The Government shall not ratify the Maastricht treaty unless and until they have agreed at a further intergovernmental conference that the United Kingdom should be allowed to adopt the agreement on social policy contained in the protocol on social policy." The statement that the Government shall not ratify would be sufficient to prevent the Government from going ahead.
§ Mr. Harry Barnes (Derbyshire, North-East)
Is my hon. Friend aware that that sounds very like an amendment that I tabled initially but was not accepted by the Chair?
§ Mr. Hoon
I do not want to get into a debate about the selection of amendments—we have been through that already—but there is a distinction. I suspect that the amendment to which my hon. Friend refers sought to amend the treaty. The amendment that would be tabled to the resolution which the Government introduced in consequence of new clause 74 would not amend the treaty but would place a road block in the way of ratification. It would be a political road block—perhaps not legally and technically a constitutional road block—should the Government ignore the clear wish and will of Parliament. It would prevent them from ratifying on political grounds.
§ Mr. Hoon
I am not familiar with that amendment. I was speculating on the reason why it was not accepted. In any event, he and I are at one in wishing to adopt the same course.
My hon. Friend the Member for Wallsend (Mr. Byers) quoted from Oppenheim's "International Law" and said that, if invited by the Government to do so, Parliament could authorise the Government to ratify a treaty. It must follow that, whatever the legal and constitutional technicalities of the matter, if Parliament specifically excludes ratification or, as in this case, makes ratification conditional on certain events, the Government should be bound to follow that.
If an amendment along the lines that I advocated were passed, I assume that the Government would have no alternative other than to be bound by its terms. They would have to face the dilemma that they have sought to 560 avoid throughout the debate—whether to accept the social chapter or reject the Maastricht treaty. I suggest that they must now spend time considering that issue in preparation for the debate that we shall have in consequence of new clause 74.
I hope that Opposition Members, including the Liberal Democrats and the various nationalist parties, will work towards achieveing agreement on that approach and will see the benefits to the European Community of having a social protocol that extends to all citizens of the EC. If it is suggested that that is likely to be a difficult or time-consuming exercise, there is little doubt that there will have to be a further intergovernmental conference, in any event, to tidy up the details of the treaty consequential on ratification. Britain's adoption of the social chapter could be one item on the agenda of that conference.
§ Mr. Byers
I am interested in the possible wording of the amendment to be moved by the Leader of the Opposition to the resolution tabled by the Minister of State. Does my hon. Friend agree that the wording of the amendment to which he referred would effectively be a condition on ratification and that the condition he suggested—of the adoption of the social protocol—would not be acceptable to the Government because they would not allow it to happen? Accordingly, such wording might be attractive to Conservative Members such as the hon. Members for Northampton, North (Mr. Marlow) and for Worcestershire, South (Mr. Spicer).
§ Mr. Hoon
Certainly, we know that the Chancellor of the Exchequer made it clear that the Government would not accept the social chapter in any circumstances. It was perhaps significant that earlier today the Foreign Secretary, given a similar opportunity to give the Government's view, was more reticent than the Minister of State, the right hon. Member for Watford (Mr. Garel-Jones), has previously been. Perhaps the Government are now aware of the dilemma that they face.
The intergovernmental conference to tidy up the results of ratification in the various member states could deal with the issue as a simple and straightforward matter. We know that the other member states would have no difficulty in accepting Britain's agreement to the social chapter. In those circumstances, I hope that it will present no great difficulty for the Government to agree to such a course.
§ Mr. Marlow
In case there is any misunderstanding in the hon. Gentleman's mind, I should explain that my right hon. Friend the Chancellor of the Exchequer will have occasionally made comments about the currency in the ERM which can be overwhelmed by the market. Such events are anticipated—my right hon. Friend has to stand by the currency and the financial aspects of the country. But if my right hon. Friend the Chancellor says that the Government cannot embrace the social contract in any shape or form, we must remember that the Government constitute a seamless web. Whatever my right hon. Friend the Foreign Secretary said or did not say today, when my right hon. Friend the Chancellor of the Exchequer makes his comments, he commits the Government, and they cannot change their mind.
§ Mr. Hoon
There have been occasions when Ministers have made statements that have not necessarily appeared to bind all their colleagues. However, the hon. Gentleman has put his view with his usual strength of feeling.
561 I return to the issue with which we began our debates many months ago. All citizens in the European Community, other than United Kingdom citizens, will enjoy the benefits of the social protocol. Throughout the days and nights of debates on the Maastricht treaty, Labour Members have merely been seeking to establish the possibility of there being a vote on whether the United Kingdom should accede to the social protocol. With new clause 74, that possibility comes one stage closer. We shall have the opportunity of debate, the Government will table a motion, the Opposition will table an amendment and, thereafter, it will be for the Government to decide whether they will put at risk the whole of the Maastricht treaty or accept the social protocol.
§ Mr. Geoffrey Clifton-Brown (Cirencester and Tewkesbury)
Thank you, Dame Janet, for allowing me to catch your eye in the final debate—on new clause 74—in the Committee stage of the Bill.
When the social charter was first mooted in 1989, I wrote a letter to my local newspaper, which is as relevant today as it was then. On 31 October 1989, I said:It was quite right to focus on the type of Europe that will emerge after 1992, because it will crucially affect the British people through the next decade and beyond. The EC should only be involved in those areas of national policy where the 12 states acting in concert can achieve more than by acting as individuals. The Social Charter, which was discussed in detail, is one of the many grey areas which fall in between these two categories. Britain with her worldwide service industry has most to gain from the free and unrestricted corporate structure. The last thing we need is Jacques Delors, or anyone else in the Commission, telling this country how individual companies should be run.In December 1989, the 11 members signed the social chapter, but the then Prime Minister, Margaret Thatcher, rejected it, because she could see that everything that had been achieved in the social sphere through the 1980s would be reversed. The panoply of union laws would return to the days of bad and restrictive industrial relations that we inherited in 1979. She could foresee that that would be the consequence if we were sucked into a European social dimension. She avoided that trap in 1989, and my right hon. Friend the Prime Minister did so again in Maastricht in 1991 when he negotiated the opt-out protocol.
When the opt-out was mooted, Jacques Delors said that itwould set a dangerous precedent, setting up one country as a paradise for Japanese investment".If that is true, I plead wholeheartedly guilty. During the past 10 years, this country has managed to obtain approximately one third of all inward investment into the Community—50,000 jobs depend on that inward investment. I plead guilty to wanting to allow this country to set its own social agenda. After all, what have we achieved by privatising so many former nationalised industries in this country if not to allow those privatised industries to set their own conditions for their employees?
§ Mr. Hoon
I am sorry that I did not interrupt the hon. Gentleman earlier, but I must return to his point about Japanese investment. Nissan has invested in the United Kingdom, but it has also invested in Spain. Does the hon. Gentleman think that it is right that Nissan's workers in Spain should enjoy higher levels of social protection than Nissan's workers in the United Kingdom? If so, why?
§ Mr. Clifton-Brown
As my hon. Friend said, that is partly a matter for the Spanish Government as the Government of the sovereign state where the company has chosen to locate, and it is also a matter for the company. If Nissan had wanted to locate in a country with different workers' rights, it would have done so. That is precisely why Nissan, Honda and many other companies have chosen to locate their headquarters and factories here rather than Spain.
As the hon. Member for Ashfield (Mr. Hoon) knows, because he knows the subject well, the Japanese have upheld good workers' rights in this country, and they were absolutely right to do so. That is one reason why they have been so successful. The hon. Gentleman and I have had discussions across the Chamber before, and what we want in this country is a high-productivity economy and a high-wage economy. We want individuals and individual companies to be free to set their own workers' rights.
Lady Thatcher was absolutely right to reject the social dimension in 1989, just as my right hon. Friend the Prime Minister was right to do so in 1991.
We have been told consistently by various hon. Members that opting out of the social chapter does not matter, because, under clauses 117 to 121 of the treaty of Rome, as amended by the Single European Act, it can be implemented in any case. A group of us visited the Commission a couple of months ago, and were told precisely the same thing. However, one crucial factor will have changed—we shall have signed the Maastricht treaty. We have held lengthy debates in the House, and there have been three referendums in other member states, so the Community, the Commission, the Council of Europe and the European Court of Justice will have to take cognisance of that process.
My hon. Friend the Member for Chingford (Mr. Duncan-Smith) has argued cogently that the preamble to the treaty of Rome and the Single European Act allows the European Court of Justice to pass judgments implementing the move towards ever closer European union. But page 117 of the Maastricht treaty makes it quite clear that the United Kingdom shall not take part in the deliberations and the adoption of the proposals made on the basis of the social protocol. It states that the agreement and attendant financial consequences other than administrative costs shall not apply to the United Kingdom.
I find it inconceivable that, if this matter goes to the ECJ for judgment, as it may well do, the court will be able to ignore that. It is all very well to say that, hitherto, the ECJ has embarked almost universally on centralising judgments. No hon. Member—certainly not I; I am not a lawyer—can prejudge what decision the ECJ will come to, but it will have to take cognisance of what is said in the treaty.
I do not believe that the Commission, or any other body, this treaty having been signed and ratified, will be able to implement those provisions of the social charter and articles 117 to 122 of the treaty of Rome, because what is written in the treaty will have to be taken into account. It is interesting to note that, of the 43 new initiatives under the social programme since it was introduced, 17 are legally binding and 25 have already been implemented by this country.
563 So we now have two social chapters in Europe, one ratified by the 12 and the other ratified by the 11. When it says in the treaty that social chapter provisions will have to be implemented by majority or unanimity voting, or qualified majority voting, that applies to the 11 states, not to the 12. I have no doubt that lawyers will argue about this matter for some time to come, but I cannot see that there are any circumstances in which the ECJ can fail to take into account this enormously detailed ratification process.
If tonight we reject new clause 74, the treaty will be ratified by the Crown. If by chance we were to implement the new clause, we would have a debate on the social chapter. If we have a debate on the social chapter and that is rejected, the Government will advise the Crown to use its prerogative to ratify the treaty. But, whatever the legal argument, the House will have given a cast-iron statement of intent that it does not wish to be bound by the provisions of the social chapter in the Maastricht treaty. I for one will be looking to Ministers in this Government and to successive Ministers to uphold that cast-iron statement of intent to the best of their ability, so that we in this country do not get sucked into the social dimension of the social chapter.
§ Sir Russell Johnston
As has just been said by the hon. Member for Cirencester and Tewkesbury (Mr. Clifton-Brown), the acceptance of new clause 74 would induce yet another debate on the social chapter later on, so I will be brief.
I will begin by giving two quotations, because one thing that is still a great mystery to me, despite the speech of the Foreign Secretary, is the reason for the Conservative Government's attitude to the social chapter of Maastricht. I still find it very difficult to understand why they are taking up the position that they have taken up. The speeches that I have heard have, in the main, been general and unspecific in arguing this case.
My first quotation will perhaps come as a surprise to the hon. Member for Ashfield (Mr. Hoon), since it is from his speech on 20 January. I thought it summed up the matter very well. I could easily have plagiarised it and reproduced it as my own, but I thought that that would be wrong. He said:I am sure that, if hon. Members tried to draw up a list of worthy causes, they probably could not do any better than the social charter. It would be difficult to imagine a set of people more deserving of protection and assistance. Yet, way back in December 1989, the Government found it impossible to accept that list, which forms the basis of the social chapter.My argument therefore is that the list in the fundamental charter is already extensively covered by existing obligations under the treaty of Rome and the Single European Act and has been accepted by all the other European Community Governments—Governments of the left, coalition Governments of the centre and Governments of the right—not once, but on a number of occasions.Why do the Conservative Government in the United Kingdom find it so difficult to go along with the views of their parliamentary allies in the European Parliament and their political allies on the continent? The German Christian Democrats have been among the most enthusiastic supporters of the social chapter, as has every other major political party on the centre right of the political spectrum in the Community."—[Official Report, 20 January 1993; Vol. 217, c. 458–59.]That, I think, puts a very good question, to which I have yet to have a cohesive answer.
564 My second quotation is much shorter. It comes from a letter written to me by the Chairman of the Free Democratic party of Germany. The FDP are the political partners, as it were, of the Liberal Democrats in Europe. The Chairman is Graf Otto von Lambsdorff, who is also, incidentally, the President of Liberal International worldwide—a position that he will yield to my right hon. Friend the Member for Tweeddale, Ettrick and Lauderdale (Sir D. Steel) next year. I mention this not simply to give my right hon. Friend the pleasure of reading it in Hansard, but also to demonstrate the closeness of our political contact.
Otto Lambsdorff is no political softie by any manner of means; he was a very tough and combative Economics Minister of the Federal Republic of Germany, and he is very committed to the free market. He said:British Government policy towards European unification seems to be ambiguous, reluctant and stubborn. Only the Liberal Democrats have a clear and comprehensive concept of European policy—and a clear and unqualified commitment to the Maastricht Treaty.Liberal policy includes the social dimension of Europe. The FDP fully supports the strategy of the Liberal Democrats in wanting both the Social Chapter and the Treaty as a whole.That, as the hon. Member for Ashfield observed a moment ago, is the general view throughout the European Community. It is not confined to Lambsdorff; one could easily get far more if one looked.
I have looked very carefully at the speech made by the right hon. Member for Watford (Mr. Garel-Jones) on 27 January in winding up our first big debate. Because of having given way extremely generously, as he did, the coherence of the speech was rather impaired, but that does not excuse the absolute absence of any argument about why the Government feel that we must be excluded from the social chapter, and why inclusion would be so damaging.
We are, of course, as the hon. Member for Ashfield observed, already committed to the social chapter of the treaty of Rome, as amended by the Single European Act. What is the difference between the social chapter of Maastricht and the social chapter of the Single European Act? There are some differences, and perhaps they are not entirely insignificant.
Article 117 of the social chapter of the treaty of Rome is fairly general. It is the one that we signed, and it says:Member States agree upon the need to promote improved working conditions and an improved standard of living for workers, so as to make possible their harmonisation while the improvement is being maintained.That is fairly clear. Article 1 of the Maastricht social agreement as signed by the other 11 states extends this somewhat. For example, it speaks ofdialogue between management and labouranddevelopment of human resources with a view to lasting high employment",and says that members should implement measures to take account of the diverse forms of national practices, and so on. So it is strengthened slightly.
The second main area of difference is that qualified majority voting is extended under article 2. Qualified majority voting is not introduced in the Maastricht treaty. It was introduced by the Single European Act, blessed by Lady Thatcher. Qualified majority voting is now extended from covering health and safety directives to cover 565 working conditions, information and consultation of workers and equality between men and women in the labour market and at work.
References to equal opportunities for men and women appear in the original treaty of 1957. One must remember that a great deal of this is aspirational. It will not come into immediate effect, but it is what hon. Members have been pledging their allegiance to as a desirable objective. It will not have instant impact. Are those the things that we find intolerable and that would make our industrial costs so high?
I could go on at length, but as far as I can see there is nothing significant in the chapter to which the Government might object. I understand that the Government might have reservatiions about the fact that the social agreement would enhance the role of organised management and labour in implementing European Community legislation. The Liberal Democrats have reservations in that area too, but such generalities would not lead us to throw out the whole lot. After all, the provision is at the direct request of management and labour, and I remind hon. Members that the agreement excludes pay, the right of association and the right to strike. The agreementShall not prevent any Member state from maintaining or introducing more stringent protective measures compatible with the Treaty".In other words, despite erroneous observations to the contrary, there is absolutely no question of dropping our standards. That was also misunderstood in the Danish referendum.
So what is it that is so unacceptable? I still do not understand. There is no doubt, as the hon. Member for Cirencester and Tewkesbury virtually conceded, that the opt-out has created quite a bit of confusion. Officials in Brussels foresee great difficulties in administration. Two social chapters will be operating simultaneously. The hon. Gentleman recognises that that will mean fun times, for jobbing lawyers. The Foreign Secretary, if I may say so, was not terribly specific. He said that social costs were too high in Europe, that that was reducing overall European competitivity and he argued that that will create unemployment—and that this must be avoided. We should have no part in it.
I find it unacceptable and undesirable that the Government have considerably weakened the situation of the low paid. The number of people in that category is increasing all the time. Consider a case described in a press release issued by the Inverness citizens advice bureau. The lady who manages the bureau cited an example of a family with two children, aged 12 and 14. The husband had been unemployed for six months. He had had an offer of employment as a security guard. Hon. Members would be wise to discover what sort of wages security guards in their own constituencies are paid, because sometimes they are appalling. Since we are in an employers' market, not only are the wages low, but often the conditions in which people have to work are unacceptable. That is what social chapters are for. They are to try to maintain minimum standards and not allow them to drop and drop.
The husband was offered a job as a security guard with a take-home pay of £88. In addition, he receives family credit and child benefit totalling £83. From this total income, he has to pay mortgage costs of £65, food, and band C council tax. If he does not take the job, the family 566 will continue on income support, which gives them £122.95, plus mortgage interest payment of £52. The basic point is that, on income support plus other allowances, the family would receive £20 a week more than if the father took the job. The lady in Inverness tells me that the CAB has been seeing at least 40 clients a week who want to know whether they might be worse off working than they are remaining on income support.
The Government have told us a great deal about work dodgers on social security benefits. There is, however, no doubt that basic social security benefits are not high—people who say that they are are quite wrong. What worries me is the Government's general approach to the Community's attempt to introduce minimum protections. It is, after all, the responsibility of the state to afford such protection to the citizen.
The Foreign Secretary took time off to quote a speech or statement by the leader of the Liberal Democrats in which the latter criticised what he saw as the risk of Community-wide wage bargaining. That criticism still holds good. We were all rather quick to suggest that such bargaining might develop, however. I do not think it will, and it would not be good if it did—at least for a long time to come.
My right hon. Friend's criticism certainly did not imply a rejection of the whole social chapter. Liberal Democrats also do not happen to regard minimum wage legislation as the most cost-effective means of achieving protection against exploitative wages. We argue for minimum earnings, which might involve state top-ups, and which are less likely to have an adverse effect on employment. Such disagreement concerns how to achieve an objective, not the objective itself. It does not mean a rejection of the attempt to agree on a common structure.
This evening, I shall leave aside the potent argument developed by several hon. Members, most notably in a previous debate by the hon. Member for Chingford (Mr. Duncan-Smith). That argument holds that competition rules, as enforced by the Court of Justice, will achieve the objectives of the social chapter if the opt-out produces the competitive edge that the Government claim it might. The upshot will be that we will arrive at the same objective in any event.
The Government came back from the Maastricht negotiations with two fallacies. First, they said that it was wonderful that the nasty word "federal" was not to be included in the treaty—not that that makes a tuppenny bit of difference to anything. Secondly, they said that they had opted out of the social chapter, thereby avoiding creeping socialism and corporatism imported from the continent. It was almost as if the Government thought that the social chapter had been devised to create mass unemployment and apply as many interfering rules and regulations as possible.
The purpose, on the contrary, is to ensure basic minimum standards of social policy all over the Community. I regard that as a good objective.
§ Mr. Quentin Davies
It is always a great pleasure to follow the hon. Member for Inverness, Nairn and Lochaber (Sir R. Johnston). I almost fell into the trap into which so many of my colleagues have fallen in these debates—of referring to him as a right hon. Member. He is always listened to with great attention. I often agree with 567 his judgments on foreign affairs, but he will not be surprised to learn that I sharply disagree with his support for the social chapter.
I listened with considerable attention to the details the hon. Gentleman gave us of a family in his constituency who were earning more on income support than they would have been if the father had had a job. That should be a cause of great concern to hon. Members on both sides of the Committee.
My right hon. Friend the Foreign Secretary delivered a devastating critique of the arguments for the social chapter. I shall not repeat them. At a time when we should be increasingly concerned about our competitiveness vis-à-vis the rest of the world and particularly in relation to the emergent nations of Asia, Latin America and elsewhere, the European Community would be stark staring mad to do anything that would increase costs and reduce prospects for employment in western Europe.
It is absurd for well-known figures on the continent such as M. Calvet, the president of Peugeot, and Madam Cresson, the last French Prime Minister but one, regularly to say that, as the EC faces increasing competition from the far east and the Pacific rim, we should take protectionist measures to defend our industries. Almost in the same breath, such people endorse the absurdity of the social chapter which can only increase the gap between our labour costs and those of the countries that are competing with us.
§ Mr. Davies
The irrationality at the heart of the thinking that has led to the social chapter deserves my strong epithet.
The Foreign Secretary did not deal with an even more essential aspect of the matter—that the concept of a social chapter fundamentally conflicts with trying to create an integrated single market. Creating such a market from 12 different national markets would mean bringing together areas with different levels of average productivity. The difference in productivity between the countries of northern Europe such as the Federal Republic of Germany, the Netherlands and the Scandinavian countries and poor countries such as Greece is enormous. If there are no artificial barriers and there is a single currency, for which the Maastricht treaty provides, so that fragmented currencies do not provide a barrier to trade within the integrated single market, and the same labour costs are imposed throughout the Community, areas, regions and firms with lower productivity will be prevented from competing.
As the Foreign Secretary said, in many cases the social costs can be 50 per cent. of total labour costs. That can only be described as crazy. An integrated single market will contain regions with different productivity levels, and regions and firms with low productivity will not be able to survive because they will not be allowed to use lower labour costs to compensate for lower productivity. That is a fundamental contradiction and unless it is rapidly resolved the Community will pay an enormous price. 568 Considerable unemployment will be created in parts of the Community that will no longer be able to compensate for lower productivity.
I hope that in an integrated single market there would be considerable productivity gains everywhere and increasing convergence in productivity. But for that to happen there must be an inducement for investment in the lower productivity areas where factory costs and the cost of labour and land are lower. That new investment will generate higher productivity and, in time, an integrated economy will emerge. That is exactly the mechanism which has worked so successfully over the past 100 years in the United States of America. In the 1950s and 1960s, industry moved from high-productivity, high-wage areas of the Ohio basin, Chicago and the north-east to California and the west coast. In the past 20 years, the deep south, traditionally a low-productivity, low-wage area, has benefited.
If employers in Mississippi, Alabama or Louisiana had been told, "You must pay the same social costs and adopt exactly the same working practices as industries in Pennsylvania, Ohio and Illinois", investment would never have gone to the deep south. It would have remained the depressed area which it was for a long time and which it has markedly ceased to be. There is a fundamental economic contradiction at the heart of the suggestion that a social chapter can be combined with the ambition to achieve an integrated single market. That has not been mentioned in the debate, but I hope that we shall focus on it if we take a further look at the social chapter proposal after the Bill receives Royal Assent.
What is the origin of the thinking that produces that extraordinary self-contradictory proposal? It is the same as the thinking behind the double illusion that has led the Labour party and socialist parties in other European countries such as France to devise proposals such as the statutory minimum wage which is self-destructive and has now self-destructed. The first illusion is that we can legislate or regulate our way to prosperity. If only we could give everybody better working conditions, higher wages, and a higher standard of living by trooping through the Division Lobby I am sure that every hon. Member would do so enthusiastically. We could say, "Let benefits and wages be doubled, trebled or quadrupled." What a wonderful world that would be.
The second illusion sets aside the fundamental principle of economics that when prices are increased, demand is reduced. It follows that if the price of labour is increased, the demand for it will fall. If social or other costs are loaded to the cost of labour, fewer people will be hired and people who would otherwise be employed will be out of a job. Following such a course is economic nonsense and has the makings of human disappointment and tragedy. Those fundamental issues are at the heart of the debate and I am confident that when hon. Members, including the hon. Member for Inverness, Nairn and Lochaber, who usually believes in economic rationality, have considered them, they will, in their wisdom, reject the social chapter.
§ Sir Russell Johnston
I have been listening carefully to the hon. Gentleman. Nothing in the social chapter suggests, for example, that, in some mysterious way, we must compel the Netherlands and Portugal to have equal 569 wages. It is not a question of producing overnight some standard, imposed solution. The hon. Gentleman is putting up Aunt Sallies and then knocking them down.
§ Mr. Davies
I am grateful for that intervention because it enables me to set right a common misunderstanding. Throughout my speech, I have been careful to talk about social costs. I did not talk about the attempt to harmonise wages. As we have already heard from my right hon. Friend the Foreign Secretary, in many cases social costs have got to the point when they represent at least 50 per cent. of the costs of labour—a significant element. I hope that the hon. Gentleman, who is a reasonable man—that is not true of everyone who sits on the Opposition Benches—will agree that the essential total cost of labour determines the demand for labour and, therefore, the Level of employment, and that we must all be seriously concerned about that.
§ Mr. George Robertson
The Foreign Secretary's analysis was remarkable. The criticism was not an attack on the high standards of Europe in terms of non-wage employment costs, but a comparison between the Community and the outside world, a fair comparison to make. However the hon. Gentleman and the Foreign Secretary should reflect on the fact that of the countries in the Community that apparently, in the eyes of the Conservative party, suffer from a disadvantage vis-á-vis the far east, the people who are benefiting—the economies that are the strongest in the European Community—are those of countries such as Germany, which believe in high standards. They may have high social costs, but they are prospering and benefiting because they are investing in people and not simply lowering standards and harming the future.
§ Mr. Davies
With your indulgence, Mr. Lofthouse, I shall extend by a couple of minutes the time in which I intend to make my speech. I should like to deal with the two important points raised in those interventions. The hon. Member for Inverness, Nairn and Lochaber, who speaks for the Liberal Democrats, said that I should remember that the treaty does not lay down any specific requirements to increase certain costs. However, it produces a framework that makes much more likely that increase in costs.
The hon. Member for Hamilton (Mr. Robertson) demonstrated another common misunderstanding, based on an error into which it is easy to fall—confusing the chicken with the egg. The argument that he was pursuing goes roughly as follows: Germany has a high level of social costs and is a prosperous country; therefore, a high level of social costs cannot prevent a country from becoming prosperous. Germany had a prosperous economy and the highest productivity levels in Europe 20 or 30 years ago, when its socialist Governments began, in the 1960s, to build up the expensive social network from which Germany has suffered—or, if one prefers, has enjoyed—ever since.
When productivity gains are achieved, and a society or a state becomes prosperous, it is open to that society to appropriate those productivity gains in a multiplicity of different ways. They can be appropriated by increasing consumption, by increasing investment or by increasing what one might call social consumption—in other words, social costs and benefits. It has been possible for Germany to do all three, but that does not mean to say that if one 570 starts simply by imposing on other countries the level of social costs of the Germans they will be able to compete at all. I fear that the effect of trying to extend German-type levels of social costs to lower productivity areas that are struggling to catch up and reach German levels of productivity and prosperity would be fatal to their chances of doing so.
When the hon. Member for Hamilton becomes a millionaire, he will be able to take his wife to Cartier to buy her some extremely expensive jewellery, or to buy a Rolls-Royce or a Ferrari, and still be prosperous. However, should he now, on his parliamentary salary, make the same purchases, he might end up in a bankruptcy court and never achieve a decent level of life in his old age. That is an appropriate analogy and the lesson that he should draw.
§ Mr. John Butcher (Coventry, South-West)
My hon. Friend is putting forward an excellent case, but he may be understating it. In recent years we have seen diaspora of jobs out of Germany. The biggest recipient of jobs from Germany within Europe, in terms of its measured outward investment in the Community, is the United Kingdom. German industrialists are thinking seriously about the pretty pass that the on-costs of social legislation in recent years have brought them to. They have had 40 brilliant years, but they are about to undo all that, and we shall be the beneficiaries.
§ Mr. Davies
I am grateful to my hon. Friend, who effectively reinforces my point. Even the most prosperous countries can over-extend themselves in the burden of social costs that they are prepared to undertake. As he rightly says, German industry and employment are suffering from that phenomenon. How much more disastrous it would be for the Community as a whole if the evil of the social chapter were extended throughout the Community and into this country.
§ Mr. George Stevenson (Stoke-on-Trent, South)
My hon. Friend the Member for Hamilton (Mr. Robertson) has been reported as describing new clause 75 as a time bomb and new clause 74 as an iceberg. I hope that the time bomb will not blow up the iceberg. I am fearful of the Government's motive in accepting new clause 74.
§ Mr. Stevenson
It has been described as cowardice and a retreat. My hon. Friend the Member for Ashfield (Mr. Hoon) said that it put the Government in a dilemma. I hope that it does, but if there is one thing that I am prepared to accept about even this Government, it is that they are not entirely daft—nearly, but not entirely—and I cannot for the life of me accept that they are prepared to roll over and play dead on the whole issue of the social protocol.
The Government have consistently opposed the social protocol. They will not have it at any price. They must have been greatly relieved when the opportunity to vote on amendment No. 27 was not afforded to the Committee. To judge by their posture towards new clause 74, they would have us believe that it poses few, if any, problems for them. It may be that the Government have judged that new clause 74 allows them another opportunity to dash into a bolthole so as to avoid defeat. I do not know. Unlike my hon. Friend the Member for Ashfield (Mr. Hoon), I am not prepared to speculate about the Government's 571 thinking. I have been disappointed many times in the past by their change of mind, because of the collapse of their discredited policies. I am not, therefore, prepared to trust them from this day to tomorrow morning. Others may speculate if they wish, but I am not prepared to do so.
Why is there this apparent contradiction in the Government's thinking? They are certain, I believe, that if amendment No. 27 had been put to a vote, it would have resulted in their defeat. Nevertheless, the Government are prepared to risk defeat by accepting new clause 74.
§ Mr. Stevenson
I shall attempt to respond to that question in detail as I develop my speech. Again, though, I am not encouraged by the Government's determination to use whatever legal mechanisms are available to them to avoid defeat on amendment No. 27 or by their acceptance of new clause 74, which they believe will enable them to avoid what they have wanted to avoid all along—defeat at the hands of the House of Commons on the social protocol.
§ Mr. George Robertson
I should hate my hon. Friend to go too far down that road. If he looks at the matter dispassionately, he will see the Government's dilemma. If new clause 74 were put to a vote, the Government would be defeated, without any shadow of a doubt. Tory rebels could have voted for it in the sure and certain knowledge that it was meaningless at this point, because the crunch comes on the motion that is consequential upon new clause 74. The Government knew that they would be defeated. Having learnt the lesson of amendment No. 28 on the Committee of the Regions, the Government decided—as happened with new clauses I and 2 and amendment No. 420—to avoid defeat by not putting amendments to the vote.
The Government hope and believe that on the motion consequential upon new clause 74 they will not be defeated, because Conservative Members will not dare to vote with the Opposition for something so intimately tied to the social chapter. As I made clear in my speech, the Opposition amendment will make it clear that the treaty cannot and will not be ratified unless the protocol on social policy is adopted. If the Tory rebels vote with us, either the social chapter will be adopted or the treaty will not be ratified—they will make a choice and we will make a choice. That is what is in front of us as a possibility. The Government would face sure and certain defeat if new clause 75 were put to a vote. That is why they accept it, and for no other reason.
§ Mr. Stevenson
I hope that my hon. Friend is correct. As I develop my speech, if I am allowed to do so, I hope 572 to make that point. Even if my hon. Friend does not accept what I say, I hope that he understands my cynicism about the Government's intentions.
Amendment No. 27 was not put to a vote. New clause 75 then arrived on the scene. After that, new clause 74 arrived on the scene. Many of us believe that new clause 74 is not an alternative to amendment No. 27. I must stress that fact. We must press for a vote on amendment No. 27 on Report. I realise that that decision is for Madam Speaker. There is a danger that if the Government accept new clause 74, as they have said that they will, the pressure for a vote on amendment No. 27 on Report will be weakened. If the Government hope that their acceptance of new clause 74 will remove the need for a vote on amendment No. 27, I am confident that Madam Speaker will note that possibility and will also note how important it is that there should be a vote on amendment No. 27 on Report.
The Government believe that if they table a motion after new clause 74 has been agreed to, they will—if they are lucky—be back in the driving seat, which will allow them to dictate the outcome. There can be every expectation that the motion will be carefully worded. It will probably be innocuous. The Government no doubt believe that the battle will then have been won. It will not have been won, though, for I do not believe that Members of Parliament will simply roll over and play dead and accept that sleight of hand.
It was only when the Government faced defeat on amendment No. 27 that we were told that it was irrelevant and was not a problem for the Government. If new clause 74 is agreed to and the Opposition amendment is adopted, the Government's position will become untenable, not for legal reasons but because of our position within the European Community. They will be unable to hide behind the Danish referendum, as they have done in the past, for the Danes want the protocol on social policy.
I am sure that hon. Members will be delighted to know that I am not a lawyer—I am not sure whether that is a benefit or a disadvantage—but after new clause 74 has been agreed the House will have an opportunity to demand that the protocol be accepted by the House of Commons and also to demand that it becomes part of the Maastricht treaty.
§ Mr. Michael Fabricant (Mid-Staffordshire)
I am very much aware of the unemployment rates in Stoke-on-Trent, South. I do not know whether the hon. Gentleman went, as I and many hon. Members from both sides of the House of Commons did, to Nomura International bank two or three months ago. I remember one Opposition Member asking the Sony and Nissan representatives what was the single most important factor that kept them in the United Kingdom, as opposed to going anywhere else in Europe. Both of them said that it was because they could avoid the social chapter here.
§ Mr. Fabricant
The hon. Gentleman then says, "Ah." I am referring to what the managing directors of the Sony and Nissan divisions here specifically said. I remember it clearly.
§ Mr. Fabricant
I do not recall the hon. Gentleman being at Nomura.
573 I do not understand the hon. Member for Stoke-on-Trent, South (Mr. Stevenson). He is speaking about various clauses and trying to impute motives to the Government, but at the end of the day—
§ Mr. Stevenson
I am grateful for your efforts, Mr. Lofthouse. I was quite happy to try to respond to the right hon. Member for Mid-Staffordshire—
§ Mr. Stevenson
I apologise. I meant the hon. Member for Mid-Staffordshire (Mr. Fabricant). I was quite happy to try to respond to him, but I am afraid that I was unable to determine exactly what his question was. I said that I was not a lawyer.
I believe that the Government's position will be untenable as a result of the acceptance of new clause 74 and, I hope, by the House's acceptance of the amendment that the Opposition intend to move. That will not be because the House will have accepted the amendment and the new clause, because during the debate the Government have shown their disregard for the opinions of the House: the Government's position will be untenable because other member states will not allow them to hide behind their opposition to the social protocol when the House has said something entirely different. I believe that other member states will insist that the Government accept the terms of the social protocol. As other hon. Members have suggested, that could quickly be done at an intergovernmental conference.
I am one of the Opposition Members who was worried about the tabling of new clauses 74 and 75 because I believed, and I still do, that the Government have been given the opportunity to slip off the hook. Why else are they accepting new clause 74 so readily? Perhaps too many Members of the House are prepared to accept the Maastricht treaty at any price.
My worries go to the heart of the treaty, because I believe that it and the Bill are seriously flawed. I say that quite openly, but I must make it clear that my concerns are not those expressed by Conservative Members who argue that we should not have the treaty or the Bill because of some outdated notion of sovereignty, and because they believe that their raw market philosophy is the way forward. A different concept and a different vision have been accepted by all the other 11 member states, and we should press for that. We should look for policies which enhance employment and growth in the EC, and we should insist on policies which promote social justice. We should not look to support a treaty and a Bill based on discredited monetarist theory. A positive social policy is essential.
My hon. Friend the Member for Hamilton says that new clause 74 means that the crunch is coming. I profoundly hope that he is right, and I believe that he is. I have been discouraged by listening to the speeches by Conservative Members today, because they have made it clear that the Government's attitude has not changed one iota.
574 I hope that the acceptance of new clause 75 and the debate on it, which will include the other amendment that the Opposition mean to table, will give the House the opportunity to insist that the social protocol be incorporated. I use the word "hope" rather than the word "expect", but right hon. and hon. Members who want the social protocol to be incorporated will have another opportunity to vote accordingly.
§ Mr. Jenkin
I am grateful for having been able to catch your eye, Mr. Lofthouse. I follow the hon. Member for Stoke-on-Trent, South (Mr. Stevenson), and I believe that we must respect his sincere and well-argued view. He believes in higher social protection, but he, in turn, must accept that that incurs additional costs. If Britain can put itself at a commercial advantage by avoiding those costs, we can make our workers in this country better off in the long term. That argument is at the core of the debate
I am grateful to my right hon. and hon. Friends on the Front Bench who have seen the Committee stage through night after night, and I want to pass on a message of thanks to them. They have put up with a great deal and remained courteous and responsive to all interventions at all times. I am especially grateful for the polite way in which they have continued to deal with me.
I am sorry that neither the Foreign Secretary nor the Minister of State is in his place, because what I intend to say relates to the exchanges that took place at the beginning of the debate. As the Committee will recall, we were talking then about what we are seeking to avoid; what measures we were not to have as a result of the opt-out arrangements, and what additional measures we would have to put up with. I want to talk about one of those arrangements, the European works council directive.
The hon. Member—I hope that one day he will be the right hon. Member, and perhaps even one day the noble Lord—for Inverness, Nairn and Lochaber (Sir R. Johnston) said how far away must be the day when there will be Europewide wage negotiations. He does not appear to be aware of the European works council directive. Under the current arrangements, even though there is a fairly strong social element in the existing EC under the treaty of Rome, we have managed to keep kicking that directive into the long grass.
Under the directive, a company with 1,000 or more employees in the European Community, with a base with 100 or more employees in two or more member states, has to set up a works council. The body is to be set up by agreement between management and employees, but where no agreement comes into force minimum legislative requirements will come into play. Those relate to a European works council's competence and its composition, and provide for annual information, meetings and consultation rights, with the cost being borne by the company. I am indebted to the Library for briefing me on the matter.
Briefly, the requirements are that there would have to be annual meetings of the management, to be informed of such matters as the group's financial situation, production and sales, employment situation and investment prospects. The council would have to be consulted about any management proposal likely to have "serious consequences" for employees' interests. Those would include 575 relocations, mergers, reorganisations and changes in working methods—that is, all the things for which we in this country have a different culture.
§ Mr. Stevenson
I assume that the hon. Gentleman will know that the proposed European works council directive, which he is worried about, is one of the priorities of the Danish presidency. The hon. Gentleman has made his views on the proposed directive clear to us. He rightly says that it is about information and consultation. If he is not in favour of that, presumably he is in favour of practices such as those employed at Dagenham, when Ford moved production to Belgium and told its employees about it by sticking a notice on the factory gates. Is he in favour of that method, or is he in favour of consultation?
§ Mr. Jenkin
The hon. Gentleman would not know the advantage that I have in that regard. I used to work for the Ford Motor Company, which has its good points and bad points in the way in which it runs its industrial relations in this country. In the United Kingdom's experience, we do not have an enclosed legislative framework in industrial relations. It is culturally acceptable in other countries. They should be allowed to do their own thing; we should be allowed to do ours. That is what the opt-out from the social chapter is all about.
In the European Community there are some 900 enterprises with more than 1,000 employees that would be affected by the European works council directive, and subsidiaries with more than 100 employees. Approximately one third of those organisations have their headquarters based in this country, and half of the top 100 of these organisations are based in this country or are British companies. We have a lot at stake in that directive; it greatly affects us.
The Confederation of British Industry, which is in favour of the Maastricht treaty, has detailed all the objections to the European works council directive. It is opposed to the European works council directive because itfails to achieve its stated purpose of improving the provision of information to and consultation of employees in Community scale undertakings, since it would impose uniform structures on an area in which flexibility of approach is essential…fails to recognise the need for diversity in this area and the wide range of practice currently prevailing in the Community…would introduce, a costly and slow moving process.Some estimates have suggested it would cost some companies up to £1 million annually to implement the proposals. It could and would impact adversely on the employee relations in some companies where there is not that legislative tradition. Maybe consultation continues on a widespread basis already, but it is not legislated for, and that is what is different.It creates a forum for cross-border collective bargaining which could have arbitrary effects.It would have upward effects on wages in the European Community, which would be bad for jobs. Itconcentrates influence in the hands of employee representatives".That is a priority of the Labour party, but it is not ours. We want to concentrate power in the hands of individual employees.
576 So what is likely to happen as we ratify the Maastricht treaty? It has been our veto which has stopped these directives. Once the treaty is ratified, the European works council directive will go ahead in the other 11 member states. Fine, you may say; that is no problem of ours because they are imposing costs upon themselves. But what about those British companies that have subsidiaries in other member states? They are going to have to establish European works councils, and then there will be blurred edges—and the European Court of Justice loves blurred edges.
What about the status of the employment bases in the United Kingdom that should not be covered by this directive but is perhaps part of the arrangements of the directive that apply to other member states? It is a complicated and difficult situation to resolve. For example, if a company has one base in the United Kingdom and one in France, would the French implementation of the European works council directive mean that we would have to have a European works council? How would that apply? It would be in the hands of the court. How is the court likely to interpret such a position?
It is interesting to look at the thoughts of the Commission on Britain's opt-out from the social chapter. I quote from a speech by Mr. Padraig Flynn who spoke at the Copenhagen conference on the role of the social partners on 15 March. He said:The Charter sets out the basic elements of a future community social policy but we cannot ignore the fact that it has a flaw: it is only signed by eleven Member States and this fact foreshadowed the outcome of the Maastricht negotiations with the United Kingdom's opt out of the social chapter.All of us sincerely hope that this is only a temporary phenomenon and that, in due course, the present or some future British government will feel able to reconsider that position.So it is clear what he is looking forward to—that there should be 12 social partners.
Hoover, Nestle, DAF-Leyland and Digital are the cases where President Mitterrand complained about social dumping. He stated:These cases raise so many issues that they alone could serve as suitable case studies for a dispassionate analysis of the problems of developing a coherent common market in which economic and social questions become virtually indistinguishable.How, then, are we going to distinguish social policy from commercial policy—where we have majority voting and all the single market stuff which is put through by majority voting—when the person initiating the policy of the Commission is determined to make it indistinguishable from social policy? It will not be up to us.
Mr. Flynn then said:I think that the social partners have to pursue new rules and new approaches which can better contribute to the creation of wealth and the greater competitiveness of firms, the safeguarding of existing levels of employment and the creation of new jobs, and, thereby, to a significant and lasting reduction of unemployment. I intend to issue a Green Paper later in the year to open a debate…So the great social machine of Brussels is just about to roll out of the station again. Unfortunately, as the former Foreign Secretary Lord Howe used to say, we have put ourselves at the back of the van. We are nowhere near the driving cab because we have lost the veto on social policy by opting out. That has very serious consequences.
Mr. Flynn concluded: 577Social policy is a vital part of the process of union. I want to see it at the centre of the debate on economic and monetary union…That is getting muddled up with another issue.…on convergence and on growth. It is not an optional extra or the icing on the cake. But it does put people first and that is what the Community itself must increasingly do if it is to attract the popular support needed for the next steps of integration.Here we have a full-blooded federalist speech which is going to drive a coach and horses through the social chapter opt-out.
I wish to conclude by returning to that crucial debate which took place on 27 January about the way in which the social chapter will operate. When my right hon. Friend the Minister of State was dealing with the speech made previously by my hon. Friend the Member for Chingford (Mr. Duncan-Smith), he mentioned three cases. My hon. Friend mentioned these three cases in a subsequent speech about the court—and he dealt with them very well—but the story continues to move on. Nothing stands still in the European Community.
One of those cases was a very significant one. It was an Equal Opportunities Commission NICs case, decided in July 1992, of the Secretary of State for Social Security versus the Equal Opportunities Commission. The Equal Opportunities Commission was suing through the European Court that there should be equality of national insurance contributions for the purposes of state pensions.
I am told that all the advice was that we would lose. I understand that my right hon. Friend the Secretary of State for Social Services took the matter to Cabinet in order to get permission to go ahead with the case because the legal advice was that we would lose. But his excellent lawyers probably told him that this is a political court, and referred to the consequences of enforcing this particular law according to the precedents. We are talking about the equal treatment directive—79/7/EEC—which affected the Barber case. The forecast was that we would lose, but the Government inexplicably won.
The Government won because a derogation which had been constantly chipped away and removed from previous rulings was suddenly reinstated with a new importance. The reason for that was that if we had lost the case at the end of July, it would have needed an immediate and retrospective change to our social security legislation, the recall of Parliament to implement it immediately and a political crisis that could have severely jeopardised the ratification process in this country. The court, therefore, mindful of the political atmosphere—or the mood of the Community, as my right hon. Friend the Minister of State would say—took care not to cause such a political crisis.
§ Mr. Budgen
Before one pours too much scorn on that political court, I am sure that my hon. Friend would agree that it is important to recognise that if we have a written constitution with a very large number of constituent organisations belonging to it, we cannot easily make law. Therefore, we have to have some form of political body at the head as a supreme court with a law-making power. We complain about the political nature of the court, but it is inherently necessary for it to be a political body.
§ 8 pm
§ Mr. Jenkin
I note my hon. Friend's comment.
In responding to the ruling made in July 1992, my hon. Friend the Member for Chingford explained that the case was a temporary aberration. He said:I feel that the case that I was discussing before the intervention was an example of the court marking time. It does not like derogations and never has. At best, it sees them as temporary and transitional means. However, that case followed closely on the Barber case, and just as the court was not willing to make that additional leap in the 1978 Defrenne ruling so soon after the significant advance made in the 1976 case". [Official Report, 24 March 1993; Vol. 221, c. 940.]My hon. Friend explained why the court is likely to pause after a major ruling.
My right hon. Friend the Minister of State sets great store by the July ruling. He says that it clearly indicates a change of mood in the court. However, not one week after the debate in which the Government reiterated all those assurances, a ruling was given on 30 March 1993 in another case between the Secretary of State for Social Security and the Equal Opportunities Commission which came before the European Court. I am referring to the case of Mrs. Thomas and others in respect of equal treatment relating to invalidity benefits and the link with pensionable age.
The ruling refers to the derogation in the equal treatment directive, article 7(1)(a) of directive 79/7, which statesaccording to which the directive is to be without prejudice to the right of the Member States to exclude from its scope the determination of pensionable age for the purposes of granting old-age and retirement pensions and the possible consequences thereof for other benefits.The arguments deployed in that invalidity benefits case about men and women qualifying for invalidity benefit at different ages relates directly to the 1992 EOC—NICs, case. [Interruption.] I am grateful that my right hon. Friend the Minister of State has come into the Chamber to listen to this crucial point.
I re-emphasise the point that we lost the ruling on 30 March. The ruling provided in July was explained thus:it can be deduced from the nature of the exceptions contained in Article 7(1) of the directive that the Community legislature intended to allow Member States to maintain temporarily the advantages accorded to women with respect to retirement in order to enable them progressively to adapt their pensions systems in that respect without disrupting the complex financial equilibrium of those systems, the importance of which could not be ignored.That actually says that the Secretary of State's victory in July 1992 was allowed because of a reason that the court invented to create a temporary derogation and not a permanent one. That is clearly stated in the ruling.
In determination of the case, the ruling continues:determining a different retirement age according to sex is only applicable if such discrimination is objectively necessary in order to avoid disrupting the complex financial equilibrium of the social security system or to ensure consistency between retirement pension schemes and other benefit schemes.Therefore, the court has progressively introduced an entirely new basis for interpreting that particular derogation and it means to chip it away. My hon. Friend the Member for Chingford explained that process of incremental interpretation so ably in his speech about the European Court.
§ Mr. Fabricant
Given that we are going to adopt the Maastricht treaty, is my hon. Friend arguing that we should adopt the social chapter and protocol because we 579 will have more influence in those matter or is he saying—as I believe he is—that we should not adopt it because the Organisation for Economic Co-operation and Development has said that the social chapter is the single biggest element responsible for producing unemployment in France? We have already heard that it creates unemployment, so what is my hon. Friend arguing?
§ Mr. Jenkin
I am simply making the point that the assurances that the Government have tried to give throughout this Committee stage cannot be guaranteed or taken at face value.
§ Mr. Garel-Jones
I hope that my hon. Friend will agree that I do not argue, and have never argued, that the British Government or any Government will win every case that comes before the European Court of Justice. In addition, I hope that my hon. Friend will agree that the case to which he is referring at the moment relates to the treaty of Rome as amended by the Single European Act. Presumably my hon. Friend is not making that a case for voting against the Maastricht treaty which, in a number of respects—there is no need to repeat the debates that we have already had on the issue—strengthens the position of member states.
§ Mr. Jenkin
I note my right hon. Friend's reticence to draw conclusions from rulings of the European Court when that does not suit him. My right hon. Friend drew conclusions from three recent rulings before the treaty was ratified. He used that as evidence that the mood in the Community was changing and that that was what was going to change the rulings of the European Court. That is what he said.
§ Mr. Garel-Jones
The difference between my hon. Friend and me is that I recognise, as I believe does the majority of the House, that we are signatories to the treaty of Rome as amended by the Single European Act. Unlike my hon. Friend, I do not regard that as a disaster for Britain and I do not regard the Community and its institutions as the enemy of the United Kingdom. I regard the European Court of Justice—and this point has been made extensively—as a court of justice manned by distinguished judges. I do not expect, and have never argued, that Britain will win every case. I simply made the point, for which I believe there is evidence, that recent judgments tend to show a growing acceptance and importance by the court to states' rights. I did not go any further than that and I never have done.
§ Mr. Jenkin
I have never said that our signing the Single European Act or acceding to the treaty of Rome was a disaster. I hope that my right hon. Friend will accept that and not attribute to me words that I have not uttered.
My right hon. Friend has been quite acerbic with other hon. Members on the same point this evening. I hope that he will also accept that I am not disputing the fact that we will lose some cases and win others. The point about the way in which the European Court works is the process of incremental revision. Earlier in our Committee proceedings, my right hon. Friend the Minister of State seemed to indicate that the tide was changing. I have just shown that the court is still behaving in its centralising way and is likely to continue to do that.
§ Mr. Garel-Jones
If I have placed words in the mouth of my hon. Friend that he has not uttered, that was not my intention. Naturally, I apologise to him. The case that he is making is based on the treaty of Rome as amended by the Single European Act. If he is making the case, he is steering a wayward course in this matter. Sometimes, it is difficult to know his position. If his position is that we should not ratify the Maastricht treaty—I do not think that that is his position—he is not making a case for it at present.
§ Mr. Jenkin
In Committee, my right hon. Friend referred to three cases which he adduced as evidence of a changing mood in the European Court. By quoting from those rulings, I am merely demonstrating that the court is reserving its position for future centralising judgments. Indeed, we have never said that the doctrine of the occupied field has been reversed and that we are moving away from the principle of the attribution of powers, which is the basis of the legal underpinning of the European Community.
§ Mr. Budgen
Does my hon. Friend agree that his point is not that he regrets the Single European Act or the treaty of Rome? All he is saying is that we are giving more powers to the European Community and, therefore, we should understand that the central and most important body in the Community is the European Court. Two things can be said about the European Court: first, it is a political body and, secondly, it has a track record for centralising and federalist decisions. The court is likely to be reverted when it becomes politically possible so to revert.
§ Mr. Iain Duncan-Smith (Chingford)
Does not the nub of the argument essentially relate to the clear problem of the way in which our opt-out of the social chapter will be viewed by those who are not necessarily influenced by the views of Her Majesty's Government? My hon. Friend is saying that the other 11 nations will use the European Court to implement and adjudicate their specific chapters and that, naturally, we will be sucked in by a bypass mechanism through the court.
§ Mr. Jenkin
My hon. Friend reiterates a point that was made in earlier debates: he is absolutely right. The purpose of my speech—I can sum it up in a few words—is that the derogation on which my right hon. Friend the Minister set great store in an earlier debate has been clearly shown to be a temporary derogation. In the ruling, we see the preserving of financial equilibrium as a completely new element to the ruling of the court, introduced only by itself. That is the danger with the way in which the social policy will continue to develop in the European Community.
My hon. Friend the Foreign Secretary set great store in last night's debate on the authority of the Committee and how it should not be interfered with. We are putting ourselves progressively in a position in which the authority of the House of Commons is simply being passed to alternative institutions.
§ Mr. Barnes
I support new clauses 74 and 75 entirely, without having any illusions about what they would achieve. The social protocol does not necessarily mean that we have introduced a socially progressive set of measures or high standards in Europe. It is simply what 581 someone has described as a framework or a set of possibilities in which various regulations and directives can be introduced later. Regulations and directives on a number of topics, such as the working environment, working conditions and information to and consultation with workers can be introduced—generally describing social in terms of labour and work—within the institutions of the European Community in different ways. They can come forward slowly or progressively. On occasions, they can be regressive and—to use another term—anti-social.
The way in which the provisions in the protocol will be used is important. I would like us to have the social protocol but I would like to see a different framework in which it could operate so that its provisions would begin to be interpreted in an improving and advancing way. We do not have a set of arrangements in the treaty that would allow us to do that.
We have what has been described by hon. Members, especially the rebels in the Labour party, as a treaty of institutions and their powers. Those institutions include the Commission, the Council of Ministers, the European bank and other institutions which are not subject to any democratic checks and controls and do not have established democratic systems in which to operate.
Many decisions are ratified by the Council of Ministers. I have tried to get the Minister to agree to publish information and records about the votes which take place in the Council of Ministers. At present, I must put down a set of questions, which are pursuant to planted questions, to get a report on which is going on in the Council of Ministers and the votes that are taken.
Yesterday, the Prime Minister provided information in an answer about the number of votes that had taken place recently. I wanted to know when the most recent vote had occurred in the Council of Ministers. At the previous 11 meetings, all the matters had been cut and dried arid no votes had taken place. The most recent vote was taken by the Agriculture Ministers on the issue of bananas. Germany and two other countries voted against the proposal, and it was carried by that arrangement.
Far from us seeing what takes place in the Council of Ministers, we cannot see what has taken place in terms of voting and the decisions adopted. In the end, most matters are decided by deals done among people without qualified majority voting entering the picture or operating. Such arrangements are entirely unacceptable. We need to move towards proper democratic arrangements in the European Community. To do so would give considerable life to the social protocol.
It would mean that many items could be dealt with through the Community's institutions, and the best progressive standards could be argued and developed. The arguments about those standards would then become a matter of public concern. They would be in the public domain and in front of the democratic institutions. Democracy seems to be a much more important element in the production of social provisions than some technique, some device, some protocol and some handing over of measures to officialdom in the hope that things will be done on behalf of people.
We have a Europe that is looking for a set of Bismarks so that the Bismarks will come forward and do things to a reasonably high standard. I would rather have democratic institutions that did not give high standards because there is a chance of doing things in the future than rely on someone to grant me authority from the superior 582 position that they hold. Developments are made only by having democratic institutions and democratic movements and argument.
In the United Kingdom, we advanced the social provision, which is described in a wider sense than being about only work and labour, through the development of our democratic institutions. For example, we moved towards elementary education through a Conservative Government in the late 19th century because more people were getting the vote and people were saying that we had to educate our masters and our work force, who were becoming significant. The House of Commons decided to introduce old-age pensions under the Liberal Government in 1910 when Lloyd George was Chancellor of the Exchequer. Labour introduced the provisions of the welfare state, which have been considerably dismantled in recent years.
Such use of democratic institutions to extend social provision is required within the Community. People talk nonsense about a federal Europe or a unitary, centralised Europe. There is a conflict between the notions that are expressed. We should seek to advance towards a fully fledged, democratic, federal Europe in which the division of its powers is described. Instead, we have a bureaucratic, developing, unitary system which takes more and more authority away from us without any democratic checks and controls.
Governments enter into deals. They might sometimes have to listen to their Parliaments. They are often able not to do so, and they hoodwink those Parliaments to a considerable extent. Parliaments should be involved in social provision. They do so only in so far as democracy is extended and developed. The provisions to which I referred came about thanks to the work of people such as the Chartists and the suffragettes. They achieved a universal franchise. In the preamble to their charter, the Chartists said that it was about improving social conditions. They wanted working-class men to have the franchise so that conditions could be improved. Unless we think about Europe in that way, we shall make considerable mistakes. So I support new clauses 74 and 75, but I have no illusions about what they will achieve.
The Government have adopted a peculiar position on the social protocol. On many occasions the Minister of State and the Foreign Secretary have told us about the fantastic advantages of subsidiarity. They have said that it is a democratic substitute which pulls power back to national parliaments. I disagree with them. However, according to the logic of their argument, they should be able to accept the social protocol because it is subject to subsidiarity. They should say that some aspects of Europe's social policies can be dealt with at European level, but many items such as directives and regulations will be subject to subsidiarity.
According to the Government's arguments, the social protocol should be acceptable. I do not accept their arguments, because I believe that subsidiarity is an absolute load of rubbish. It means anything that anyone wants it to mean. It allows centralised decision-making to take place. Therefore, the treaty does not have proper democratic arrangements built into it. We do not want subsidiarity, which merely allows further centralisation. We want federalism of a democratic nature.
Federalism which links with centralism is like the federalism of the former Soviet Union and Yugoslavia. That was never federalism—it was centralism, because 583 power was subsumed by bureaucratic centralised forces. That is the danger of the treaty. I support new clauses 74 and 75 without any illusions, and I oppose the Bill.
§ Mr. Hugh Dykes (Harrow, East)
At the beginning of the debate, there were marginal differences between the two sides. It gave a bizarre impression. I felt that one could imagine Opposition spokesmen saying, "The gulf between us and the Government on this subject is huge. We believe that the social protocol has a circumference of 30⅛ cm and the Government believe that it has a circumference of 30 3/32 cm. That is a huge and unbridgeable gulf. We believe that the Government are wrong."
§ Mr. Dykes
I should not like to suggest how many. It might be shrinking or expanding.
The debate has been bizarre. The divisions between hon. Members have widened with the more recent speeches. I certainly do not agree with the points made by my hon. Friend the Member for Colchester, North (Mr. Jenkin) in his lengthy speech—I think that he spoke for 25 minutes or more.
I sense that hon. Members, including those who have not taken part in the debate, would like it to conclude fairly speedily. For that and for other respectable reasons, my remarks will be brief. I do not challenge the Chair's judgment on the length of the debate, Mr. Lofthouse. It is a matter for the Chair. But I imagine that it might be the overwhelming feeling of hon. Members that the debate should conclude.
I am perhaps more enthusiastic about the development of the European Community than some of my colleagues. I use the word "some" deliberately. I certainly do not include among them my right hon. Friend the Minister of State, who has done excellent work. I know that he is justifiably keen on the developments in Europe, because they enhance the national interest and the intrinsic national sovereignty of the United Kingdom working with our partners.
Inevitably, in the debate on new clauses 74 and 75 during the last days of the Committee on the Floor of the House, we are taken up with our preoccupations in this ancient and important House of Commons. But we seem to have the impression that we are in a vacuum, and that the other member states of the European Community are of no consequence.
We should remember that 10 member states have ratified the treaty. The exceptions include the eccentric actions which have taken place in the federal supreme court in Karlsruhe. I believe that they will shortly be determined. The judges may be presiding over them at this moment. With that exception—I cannot think of any other —10 member states have ratified the Maastricht treaty in respect of all their constitutional requirements. They are waiting with mounting impatience for the eccentric hesitations of the United Kingdom and the even more eccentric hesitations of the Danes to catch up with that reality and that process.
Britain's process of ratification will now be further extended as a result of new clause 74, and to a lesser extent new clause 75. I regret that. I assume, optimistically, that the votes on the resolutions that will be presented to the 584 House under new clauses 74 and 75 will take place fairly quickly. Perhaps the Minister of State will clarify that today or on a later occasion. Some hon. Members have suggested that they will take place before Royal Assent and others have suggested that it will be after Royal Assent. That is a matter for abstruse argument—perhaps it does not matter—but I hope that the motions will be introduced soon.
I assume that the Bill will take a minimum of six or seven weeks in the House of Lords, and that those who intend to rebel against the treaty and the legislation will be ground into the dust by the natural majority in the House of Lords in favour of the treaty. I look forward to that process. Some distinguished and eminent Members of the upper House will be involved. I am sure that they will be crushingly defeated during that six or seven-week process. That will bring us—without anticipating the progress of the Bill in this place and incurring your displeasure, Mr. Lofthouse—to the third week of July. That will be enough.
I believe that, on 18 May, there will be a positive yes result in Denmark. I was telephoned by a journalist who is a famous and distinguished member of the Lobby—deliberately, therefore, I will not mention his name—from Copenhagen and by another journalist who is also there. They told me that there are positive signs that there will be a powerful yes vote. They had tried to put articles in their respective newspapers, but the editors were not keen on taking them. That is the black press of the United Kingdom newspaper industry. It is not keen on giving good news about the European Community.
In his amusing account of "Dancing with Dogma", Lord Gilmour, a distinguished former colleague in the House, gave essential good advice. He said that Baroness Thatcher wanted everyone to cease to be citizens of the United Kingdom and become consumers. I remember visiting in Brussels Madam Papandreou, who causes a great deal of excitement, anxiety and bitterness among some of my Tory colleagues because of her reputation as a social reformer. She said that Mrs. Thatcher wanted to make the whole Community into one big supermarket. I suppose that that was the essential approach of the previous Conservative Government, at least in respect of its leadership.
That is no longer the case. We now have a balanced Conservative Administration running pragmatic policies from the centre. Although we shall not be present for it, I am sure that my right hon. Friend the Prime Minister's speech on Europe at the meeting of the Conservative group for Europe at one of the leading west end hotels tonight will be enthusiastic.
I cannot understand all the excitement about these matters. I cannot see any differences on social policy between the provisions in the Maastricht treaty and the provisions in the Single European Act. I suppose that the provisions in the treaty are softer in tone and refer more to commencement reflecting unanimity rather than majority voting; otherwise, they seem exactly the same. It is almost as if the Maastricht treaty had been written by the same officials on the basis of the Single European Act. I would not trespass on the patience of the House by reading them all out, but they are similar.
I am fascinated by the reference to article 118B in the Single European Act which says: 585The Commission shall endeavour to develop the dialogue between management and labour at European level which could, if the two sides consider it desirable, lead to relations based on agreement.By the way, the French text and the German text refer to legal agreement. There may have been nifty footwork, or whatever the equivalent is with the pen, by British officials when they ensured that "legal" was left out. I am only guessing that; I am not sure that it is so. Some people might say that the reverse was true, because the others wanted to include the word "legal". I doubt that. However, it shows that the United Kingdom has already signed up to the concept of the social protocol.
§ Ms Joyce Quin (Gateshead, East)
Given that the hon. Gentleman says that there is not much difference between earlier commitments on social policy and the commitments in the social chapter of the Maastricht treaty, is he saying that he does not agree with his Government's opt-out in the treaty, and that he will therefore vote with us in trying to ensure that Britain becomes part of the social chapter?
§ Mr. Dykes
Because the relevant motions in due course will be merely expressions of opinion and nothing more, we will have to judge them when the time comes. I suppose I would be one Conservative Member who would be less intensively opposed to our inclusion in the social chapter. Because I recognise that this country has had recessionary problems which are more severe than those of some other member states—including France, despite what has been said by other hon. Members—I want to give the Government the benefit of the doubt when they say that it would be wrong for us to be included in the social protocol at this stage.
As the Conservative party returns to a tradition of pragmatism and moderation, and gets away from the narrow and mean-minded attitude of keeping the workers in their place, a future Conservative Government will probably have more self-confidence in respect of acceding to the then developing social protocol. I do not believe that there will be anything to worry about, but the United Kingdom economy should perhaps be stronger before we accept that position. No one can say with certainty how matters will develop.
It is farcical to say that there is anything terrifying in these matters intrinsically, because no specific proposals have yet been made by the 11. They will use the machinery of the Community and the Commission to produce proposals. When they roll off the production line, I think that they will be few in number, because the other member states are beset as well by recessionary anxieties, and they will be mild in character. It will be left to member states to decide the framework. Indeed, that is laid down in the relevant parts of the Single European Act and the Maastricht treaty. Therefore, I have no great terror about them, but I understand the Government's hesitation.
People have said, with justification, that the Government acted as they did because they felt obliged to keep their own supporters in place. Bearing in mind what has happened during the prolonged Committee stage, that calculation may not have turned out to be accurate. Be that as it may, it was a legitimate political calculation for any Government to make, even if the so-called supporters who were being wooed were rather ungrateful, cavalier and churlish about it, and did not respond to the effort at appeasement. We will see later how matters work out. In 586 the meantime, I am happy to support the Government enthusiastically in their suggestions about new clauses 74 and 75.
§ Mr. David Lidington (Aylesbury)
I confess that I am slightly disappointed that the Government have chosen to accept new clauses 74 and 75. It would have been helpful to have a vote and to put the debate on the social chapter behind us. Unlike my hon. Friend the Member for Harrow, East (Mr. Dykes), I have no compunction about opposing the notion of the social chapter. I understand the honest advocacy of it by Opposition Members. It seeks to move Europe, including this country, in the direction of economic and social policy which is in line with their honestly expressed political philosophy. I cannot blame them for that aspiration.
This is a debate in which there are cannons to the right as well as to the left. I want to spend some time addressing the arguments of some of my hon. Friends, expressed most cogently and strongly by my hon. Friend the Member for Colchester, North (Mr. Jenkin) in his speech and by my hon. Friend the Member for Chingford (Mr. Duncan-Smith) in interventions in this debate and in previous Committee sittings.
Their objection seems to fall into two parts. They argue basically that the social chapter is obnoxious and that it runs counter to Conservative principle and policy, but that nevertheless the Government's opt-out is meaningless. I think that they have two reasons for saying that. I shall try to present the argument at its strongest and not to misrepresent it. The first strand of their argument is that the opt-out does not matter because any regulation which was important could be forced through the institutions of the Community and imposed on this country by qualified majority vote under article 118A of the existing treaty concerning health and safety or article 100A concerning the single market. Certainly Commissioners, notably the unlamented Mrs. Papandreou, have sought to stretch the meaning of the Single European Act in recent years beyond what had been anticipated by politicians or lawyers in this country when it was negotiated.
Against that assessment by my hon. Friends, one has to consider the view of fellow members of the Community on the British opt-out from the social chapter. One has to ask oneself why the 11 other member states thought it necessary to have the social protocol attached to the treaty, and why they believed that it was not enough to rest on the provisions already included in the Single European Act. Presumably they felt that their ambitions for a grander European economic and social strategy could not be realised under the existing treaty.
Mr. Delors' talk of the United Kingdom becoming a paradise for inward investment has often been quoted. There are other examples. There were reports that the German Social Democratic party and the German Trade Union Federation were considering action to question the legality of the British opt-out because they were afraid of its effect on German competitiveness. The Portuguese Secretary of State for European Integration, Mr. Vitor Martins, said last year that the social protocol put the 11 other members of the European Community at a disadvantage compared with the United Kingdom. In recent months we have heard dark mutterings from French politicians about the relocation of jobs from France to the United Kingdom by Hoover and other firms. Whatever 587 the reasons for those decisions, French politicians have questioned our opt-out and argued that it presents economic dangers to France.
There will be those in the Community, notably in the Commission, who will seek to stretch the rules. We have seen that in the past and no doubt we shall see it in the future. My hon. Friends the Members for Colchester, North and for Chingford, however, underestimate the legal grounds that are available, in the last resort, to the British Government and the practicalities of current political trends within the Community.
§ Mr. Bill Walker (Tayside, North)
I should not like my hon. Friend to be under any misapprehension. During the passage of the Single European Act some of us did draw attention to the fact that what he described as stretching might occur. We did not see it as stretching—we saw it as an inevitable process, and we believe that the same will happen under the Bill.
§ Mr. Lidington
I know that my hon. Friend and other senior Members of the House have been consistent in their opposition to EC legislation for many years.
The legal case which would be available to the British Government, should they choose to take it, could rest on the words of article 118A, which limits qualified majority voting to directives brought forward on the grounds of health and safety. They could also refer to the restricted wording of article 100A, which refers to the internal market—a definition made tighter by the wording of the Maastricht treaty. Article 3 describes the internal market as onecharacterized by the abolition, as between Member States, of obstacles to the free movement of goods, persons, services and capital".The concept of the internal market is therefore separated within the treaty from the objectives of the union towards strengthening economic and social cohesion, as listed in article 3(j) and the objective of contributing to a high level of health protection, listed under article 3(o).
We must also take into account, as my hon. Friend the Member for Harrow, East acknowledged, the political and practical arguments now at play. We should consider the considerable successes of my right hon. Friends in moderating some of the proposals from the Commission so that they are at worst unobjectionable, and at best often desirable from our point of view. Faced with the pressures of recession and the threat of severe competition from the developing economies of the Pacific rim, other European countries have begun to question whether new regulations are needed. At the last ECOFIN meeting we were treated to the spectacle of the Spanish and German Ministers saying that there was no longer any need for extra regulations and, indeed, that the reverse was true.
The second argument advanced by my hon. Friends the Members for Colchester, North and for Chingford related to incremental revision by the European Court of Justice. They argued that because the court can look to article 2 of the treaty, which sets out the aim of strengthening economic and social cohesion, the court will use that, case by case, to undermine the exemptions given to us by the social protocol.
Article 4 of the treaty says:Each institution"—including, of course, the court—
588shall act within the limits of the powers conferred upon it by this Treaty.We must also consider what the protocols mean. I have not read all the detailed papers, so I shall not enter into the argument between my hon. Friend the Member for Colchester, North and my right hon. Friend the Minister about recent individual cases heard by the European Court of Justice, but I believe that there is a substantial difference between the court ruling on the meaning of directives approved by the member states, through the institutions of the Community, and the court seeking to overturn, in whatever manner, a protocol which has equal status with the main text of the treaty.
§ Mr. Duncan-Smith
I am glad that my hon. Friend has quoted my hon. Friend the Member for Harrow, East, who has already categorised him and me as mean-spirited people for finding great fault with the concept of the social chapter.
The nub of my argument, which I believe that my hon. Friend has slightly missed, is that the problem lies in the protocol, which states:without prejudice to the provisions of this Treaty, particularly those relating to social policy which constitute an integral part of the 'acquis communautaire"'.The court does not set out to reverse anything by itself that would be done as a result of what is brought before it by a variety of challenges. It is a fact that that protocol cannot be invoked by us to reject the fact that we shall be bound into certain social provisions—I say certain, not all—because the court will not take the protocol or the chapter into consideration because it is obscured by the protocol. That is the danger. The protocol is the threat; it is kept around the treaty when it should be banished.
§ 8.45 pm.
§ Mr. Lidington
The battle over the interpretation of "acquis communautaire" embodied in article 118 and in others will continue and both the political and the legal arguments will come into play. The crucial point about the protocol is that it is explicit and lays down with the authority of a treaty that the United Kingdom is excluded from measures brought forward by the other 11 member states within the context of that protocol.
§ Mr. Lidington
I apologise to my hon. Friend, but I must draw my remarks to a conclusion.
I shall be with my hon. Friends the Members for Chingford and for Colchester, North in arguing, as we approach 1996, that we should seek further treaty revisions, further protocols, which define, limit and make more precise the remit of Community institutions as opposed to those of individual national Governments and Parliaments. As to the debate on which we are embarked now, the decision of all Conservatives to reject the social chapter accords with political principle and with our national interest.
§ Ms Joyce Quin (Gateshead, East)
We have had an interesting debate on the procedure and the substance of the social chapter.
My hon. Friend the Member for Hamilton (Mr. Robertson) explained clearly the Opposition's view on the procedure that we are adopting and I support what he said. I also support what he said about the continuing 589 importance to us of amendment No. 27. I share his hope and that of other hon. Friends that that amendment will be dealt with on Report.
We also attach considerable importance to new clause 74 because it is an effective way in which to ensure, before the Act comes into force, that the Committee can express its view on the social protocol and the social opt out that the Government negotiated at Maastricht. It would be outrageous if the Committee did not have an appropriate opportunity to vote on the desirability or otherwise of the United Kingdom's incorporating the social chapter in its version of the Maastricht treaty. There is no doubt that the exclusion of Britain from the social chapter is by far the most important way in which the deal on offer lo the British people differs from that on offer to all the other people of the European Community. It is, therefore, one of the most important aspects of our considerations of the Maastricht treaty.
The Foreign Secretary did not say a great deal about procedure and I got the impression that he was not terribly keen to speak at length on the procedural issues involved, despite the fact that some of his hon. Friends tried to embroil him in precisely such a discussion. In answer to one of my hon. Friends, he said that the Government would simply have to reflect on the position depending on what happened when the Bill had completed all its stages and we were faced with a motion on the social chapter.
I hope that the Government will reflect on this matter. I do not know whether the Minister is planning to give us any more information on procedural matters, but Members on both sides of the Committee would welcome further information from the Government about their thoughts.
I am glad that the Government have accepted new clause 74, although I agree with my hon. Friends that the Government probably had no alternative, because they would have been defeated. There is no doubt, however, that the Foreign Secretary skated over the implications of a defeat on whatever motion is eventually put before us on the social chapter and our adhesion to it. I should welcome from the Government a clear commitment not to oppose the will of the House if hon. Members vote against the Government's view on the social chapter.
An aspect that will be of interest, although it has not been clarified in today's debate, is the likely attitude of the nationalist parties towards whatever motion is tabled on the social chapter. We in the official Opposition have often referred to what we regard as the shabby deal that was done between the nationalist parties and the Government over the question of the Committee of the Regions. That shabby agreement seems to have resulted in the nationalists supporting the Government on all sorts of procedural votes since. I do not know whether the nationalists also plan to support the Government in whatever motion is tabled on the social chapter. I hope that they will not, because it would result in a bad deal for the people of the constituencies they represent and for Britain as a whole.
Like many hon. Members who have spoken in the debate, I am not a lawyer. I am not even a jobbing lawyer, a phrase which calls to mind an exchange between the Minister of State and the hon. Member for Wolverhampton, South-West (Mr. Budgen). So I was glad that, although the Foreign Secretary disappointed us by not saying enough about procedure, he at least referred at some length to the substance of the social chapter. Again, 590 I got the impression that the right hon. Gentleman was more interested in convincing his hon. Friends of the merits of what he was saying than anything else. He was certainly anxious to get the support of the Euro-sceptics on the Benches behind him for whatever motion is finally put before us.
I do not think the Foreign Secretary convinced many of his hon. Friends. He might have convinced the hon. Members for Cirencester and Tewkesbury (Mr. Clifton-Brown) and for Stamford and Spalding (Mr. Davies), who both supported the right hon. Gentleman's position. But the Foreign Secretary was a long way from satisfying other of his hon. Friends, including the hon. Members for Southend, East (Sir T. Taylor), who spoke in interventions, for Colchester, North (Mr. Jenkin) and for Aylesbury (Mr. Lidington), who did not appear to take quite the same Euro-sceptic line as some of his hon. Friends.
As we listened to contributions to the debate by Conservative Members, we heard two different views emerge. On the one hand, the Government view of the social chapter was that it was dreadful, that it had to be resisted and that the only way to resist it was via the opt-out of the Maastricht treaty. On the other hand, we heard the strong view that the opt-out was a waste of time because the social measures could be enforced via existing treaties and treaty obligations.
§ Mr. Jenkin
I must correct the hon. Lady. I do not think any of my hon. Friends have said that the opt-out is a waste of time. We are simply seeking to demonstrate that the Government claim that the Maastricht treaty will avoid intrusive legislation, the mandate on which they conducted the Maastricht negotiations—[Interruption.] I stand corrected if I recall the position incorrectly. Our worry is that the lessons of the Single European Act have not been learned and that the Maastricht treaty could make matters worse.
§ Ms Quin
I am far from convinced. I listened with interest to the hon. Gentleman's speech tonight, having listened to him on a previous occasion, when we were debating amendment No. 27. He then said little in favour of the social opt-out and much about how inevitable the social measures would be, whether or not we had an opt-out. That message came across clearly from several of his hon. Friends, so I cannot regard his most recent comments as persuasive.
Euro-sceptics on the Government Benches say that the opt-out will not have much effect. Meanwhile, supporters of the Government line say that the opt-out is necessary, and they congratulate the Government on having achieved it. But the hon. Member for Harrow, East (Mr. Dykes) was the exception. While he has supported the Government strongly in their European policies, he conceded that there is already a commitment to the social dimension under existing treaties, perhaps making the opt-out less effective than the Government claim. [Interruption.] I gather from the demeanour of the hon. Member for Colchester, North that his hon. Friend was agreeing with some of his comments. Even so, the hon. Member for Harrow, East dealt with the matter from an entirely different perspective, and he is troubled by the fact that the Government's social opt-out is putting Britain at a distance from its European social partners in an important area of policy. That is also worrying the former 591 Prime Minister, the right hon. Member for Old Bexley and Sidcup (Sir E. Heath), who has spoken in favour of the social chapter and has cast doubts on the Government achieving the opt-out.
The Foreign Secretary tried to make a strong case against the social chapter. That case was not convincing, not just to many of his hon. Friends but to all who spoke from the Opposition Benches. The right hon. Gentleman again claimed that the social chapter would be a huge burden on business, yet he produced little evidence to support that claim.
His hon. Friend the Member for Mid-Staffordshire (Mr. Fabricant) tried to make a helpful intervention by referring to Nissan, even though he must have overlooked the views of that company's managing director, given recently to the Select Committee on Employment, when he said clearly that the social chapter was in no way a problem for Nissan and that the company, operating in Sunderland, already complied with the various requirements of the social chapter and the social charter and saw no difficulty in Britain being a fully paid-up member of the social chapter. That view must be made loud and clear.
Government supporters referred at length to the question of inward investment and agreed with comments reported to have been made by Jacques Delors about the United Kingdom being a paradise for inward investors if it did not have the various attributes of the social charter and the social chapter. On that issue, I do not agree with Jacques Delors, and recent evidence shows that inward investors would not be deterred by the United Kingdom's being part of the social chapter. I refer hon. Members to an interesting recent publication from the Organisation for Economic Co-operation and Development, "Financial Market Trends".
§ Mr. Duncan-Smith
The hon. Lady said that inward investors would not be deterred if we were to participate in the social chapter. That is not the key question, which is whether they would be encouraged by this country being exempted from the social chapter.
§ Ms Quin
My own contacts with Nissan have provided me with no evidence to suppose that that is so. The publication that has recently been produced by the OECD studies trends of direct inward investment in different European Community countries in the past two or three years. It contains the following sentence, which seems a surprising one, given the claim of Conservative Members during today's debate and on earlier occasions:On the recipients side, France was the notable exception to the general slowdown registered among OECD Member countries. Inflows to France grew faster than outflows, and for the first time foreign direct investment in France is larger than French investment abroad".In 1992, our Government were constantly criticising the French Government for their attachment to European social issues and their commitment to the European social chapter. The facts as outlined by the OECD seem to prove the exact opposite of what Conservative Members have been trying to prove in the debate. That point must be made loud and clear.
The Foreign Secretary was wrong when he talked about the costs of employee protection. He seemed to fail to see any advantages in employee protection. He claimed that it destroys jobs, but that does not fit in with what happened 592 in Britain in the 1980s, when unemployment rose dramatically precisely when the Government were weakening various aspects of employee protection. The fact that we have lower levels of employee protection does not seem to stop us having the fastest rising unemployment in Europe at present.
§ 9 pm
§ Ms Quin
No, I do not think that I shall. I have looked at the figures and it is clear that over the past couple of years unemployment in the United Kingdom has risen faster than it has in any other European country. Another hon. Member referred to the welcome drop in unemployment today, but that does not alter the figures for the past two years, however much Conservative Members might wish that it did.
§ Dr. Liam Fox (Woodspring)
As the hon. Lady specifically mentioned France, will she say why Hoover decided to relocate in Scotland, not France? I believe that it is the first of many companies that will do so if we stay out of the social chapter and France remains party to it.
§ Ms Quin
I do not know whether the hon. Gentleman was present for the Foreign Secretary's speech, but the Foreign Secretary rightly said that the movement of jobs was a two-way process. He acknowledged that it was not a simple trend that could be explained by a simple reason. Certainly, although there was not nearly as much publicity about it, there was a transfer of jobs by Nestle from this country to Dijon shortly after the transfer of Hoover jobs from Dijon to Cambuslang. We must take account of all the factors, not isolate and oversimplify a complex matter.
Many of us feel that one of the main aspects that help a company to decide where to invest is the availability of skilled labour. We must also bear that factor in mind when considering inward investment flows. I am keen for inward investment to continue and I hope that we shall have the right conditions for inward investment in future. If one listens to Nissan and looks at the records of other Japanese countries that have invested in this country, one sees that they all have better social protection than is envisaged in the social charter. That reason blows an enormous hole in the arguments advanced by the Government.
Some hon. Members have today rightly referred to the untenable position of British multinational companies which will operate in the single European market and will be affected by the other 11 countries' social policies. That will make it difficult for this country to stand aside. I cannot believe that it will be feasible for British firms that employ people in a great many other European countries to operate an entirely different system in the United Kingdom from that which they operate in the other 11 countries.
I am glad that the Foreign Secretary said that a social dimension was important in Europe. However, I am sorry that he went on to say that it was important only in a general way, and that it was not important to back it up with specific commitments and regulations. I felt that perhaps the Foreign Secretary has been dealing with foreign affairs for too long, as he seemed to be out of touch with some of the working conditions in Britain today.
593 I was glad that that point was made not only by my hon. Friends, but by the hon. Member for Inverness, Nairn and Lochaber (Sir R. Johnston) when he spoke about conditions in the security industry. That is something that I can back up from my own experience in my constituency, where not long ago, for example, a job for a security guard was advertised at £1.85 an hour for a 70-hour week—working a great many hours in a difficult and dangerous job.
That kind of statistic shows that there is, unfortunately, exploitation in Britain today. I believe that that exploitation is particularly strong in areas 'where unemployment is so high that people will go to almost any lengths, quite understandably, to get jobs. But the fact that unemployment is high is no excuse for appallingly low levels of social protection. That is something which we must also bear in mind.
The problem of poverty in Britain, which is very serious and increased during the 1980s, should make us, above all countries, take the social dimension in Europe very seriously. It is tragic that we are marching in the wrong direction. It is not right that we end up subsidising employers who pay poverty wages. In the example quoted by the hon. Member for Inverness, Nairn and Lochaber, it was clear that the only way that people in the security industry can survive is by claiming family credit and income support in various ways. It is not right that good employers should be undercut by bad employers who benefit from these unfair subsidies.
It is a great shame that there was no recognition n the Foreign Secretary's speech or, indeed, in the speeches of other Conservative Members of the fact that high levels of social protection can help companies. I was reminded of that when I read this week a helpful booklet, which I think is produced by the Business in the Community organisation, entitled "Corporate Culture and Caring". In a few interesting case studies it shows that it is sensible for firms to have good maternity benefits and good child care provisions of various kinds to get trained workers back to work, because that costs employers far less than getting rid of people and then being forced to take them on again later. This, too, is an aspect that should be taken very much into account.
It is not good enough for the Foreign Secretary to talk only about unemployment or for the hon. Member for Stamford and Spalding to say that unemployment is the only problem that we face in Britain today. We have to see the twin evils of unemployment on the one hand and very poor wages and working conditions on the other, and if we do not tackle both of them the country will not be in a. very happy or healthy position in the future.
I urge Conservative Members to read the recent report from the National Association of Citizens Advice Bureaux, which depicts very graphically some of the poor working conditions in Britain today.
One of the aspects that the Foreign Secretary mentioned was unfair dismissal. He said that he was worried that under the social chapter such issues might be looked at on the European level. I should be delighted if the European Community looked at this area of policy, because it is clear that in no other European country do part-time workers have to work for five years for the same employer before they get any rights whatsoever with regard to unfair dismissal. That seems to me to be a distortion in the European market that is completely unacceptable.
594 The Government, as we know, have played a deeply negative role in employment and social affairs matters in the European Community. They have blocked many of the social directives which Labour Members believe are important and would have been welcome additions to the body of European legislation. I refer to such measures as the directive to give employment protection to part-time and temporary workers—a growing part of the British labour force. There is also the directive to give a parental leave entitlement during a child's first three years of life. Many other directives have been similarly treated.
I suppose that, as time has gone on, the Government have become increasingly embarrassed by their isolation in Council meetings of Employment and Labour Ministers, because they have continually had to veto sensible proposals advanced by the other 11 countries. Perhaps because of that, the Government saw the Maastricht social opt-out as a way of ending their embarrassment and isolation. Henceforward, they would not be consulted about or involved in that sort of decision making.
The Government are incorrect, however, to think that they can spare themselves that sort of embarrassment. As my hon. Friends have pointed out, whatever happens, we cannot hope to enjoy some sort of neat isolation on social issues from the rest of the Community. That is just not possible. As the hon. Member for Inverness, Nairn and Lochaber said, it will cause a great deal of confusion and administrative difficulty which the Government have not taken into account.
As several Conservative Members have noted, there is also the possibility of the competition rules being invoked at the European Court, and other countries are likely to use certain aspects of European legislation against Britain if they believe that we are deriving an unfair advantage through the social opt-out.
Some Conservative Members have expressed the hope that the principle of subsidiarity will extricate the Government from the difficulties surrounding social policy. I tend to agree with my hon. Friend the Member for Derbyshire, North-East (Mr. Barnes), who described the flexible nature of the definition of subsidiarity—it seems to mean whatever people like it to mean. The Government define it as applying whenever they do not like some European measure. Then, they say, we should decide the matter at home. We do not find that very convincing.
I would not counsel the Government to entertain any hopes that subsidiarity can be invoked to spare them difficulties with social legislation. The conclusions of the Edinburgh Council meeting clearly stated that the social chapter had to be proceeded with and that there was no question of its being dismantled under the heading of subsidiarity. The Government are therefore in danger of. being dragged along, all unwilling, on social matters, if they insist on pursuing the social opt-out avenue. It would be far better to be a fully participating member of the European Community and to take part in social affairs decisions than to be dragged through the European Court subsequently, which would serve only to weaken our position in the Community.
There is no doubt that our semi-detached status in Europe detracts inward investors. Ernst and Young have done an interesting study, surveying many of the United Kingdom's leading companies. It shows that the opt-outs agreed by the Government at Maastricht worry businesses and inward investors, who wonder about the scale of the 595 Government's commitment to the EC and whether Britain will be a good base from which to operate if it does not offer proper access to the rest of the large internal market. The Government should take such worries seriously.
If the Government accept our view and opt back into the social chapter, that will ensure an orderly and effective way of dealing with social issues. It will avoid the Government's being embarrassed and dragged unwillingly into decisions. Many hon. Members on both sides have tellingly described how that might come about.
My hon. Friend the Member for Derbyshire, North-East made a worthwhile point about how the Council of Ministers dealing with social issues work. The problem is secrecy; it is difficult to find out which way Governments voted on some issues. It is irritating for Members of this Parliament or of the European Parliament to be told in answer to questions that we are not allowed to know how Governments have voted, although the next day the answers to our questions are published in the newspapers.
My right hon. and learned Friend the Leader of the Opposition and some leaders of our sister parties in the Community and outside it recently held a meeting at which my right hon. and learned Friend met the new Danish Social Democratic Prime Minister whose election we welcomed. Also present were party leaders from Norway, Sweden and Finland and the leader's representative from the Federal Republic of Germany. I welcome the agreement reached between my right hon. and learned Friend and his colleagues. That agreement was a way forward for the Community and a welcome change from the negative attitude that Ministers have adopted throughout our Committee proceedings. The attitude of my right hon. and learned Friend is indicative of the way that Europe should go on social and employment issues.
The communiqué of that meeting showed the importance not only of tackling employment but of a social dimension to safeguard Europe's achievements in social protection. That communiqué was issued on 5 April and stated that all the parties agreed that Europe must be more than just a market for business. It must be a community for people. That is why the social dimension is critical.
My right hon. and learned Friend and his opposite numbers agreed on the importance of unblocking some of the social initiatives that for years have been persistently blocked by the Government in the Council of Ministers. One of those initiatives was mentioned by the hon. Member for Colchester, North, who spoke about the European works council directive. He suggested that the matter would be pursued via the social protocol by the other 11 countries acting on their own. The Government will have to give some kind of view on this issue at the next official meeting of the European Council of Labour and Employment Ministers.
Perhaps the Minister of State will tell us about the attitude that the Government will adopt to those directives at the June meeting of the Council. The right hon. Gentleman seems to be sinking lower in his seat and avoids meeting my eye. I shall repeat my question, because three important directives are to be considered at that meeting. One will be a directive on works councils. Another will be 596 on working time, which is of great interest to many British people who are forced to work long hours. Another confirms the directive on the protection of young people at work. Again, the Government have so far taken a negative view on that.
I should like to hear from the Minister what attitude the Government are to take at the June Council of Labour and Employment Ministers on those three matters. What is not an option at the meeting is simply to postpone the matter. The Danish Prime Minister has said clearly that the Danish presidency wants to get agreement at that meeting on those three important directives as well as on other matters on which the Government might have an idiosyncratic view.
It does not look as though the Minister will enlighten us this evening on the Government's view, so let me make it clear that we shall watch him closely on those matters because we believe that the three directives are very much in the interests of British people at work. It would be outrageous if the Government went along to the Council in June and simply blocked them. The Government might try to block them in the hope that the other 11 member states would simply go on by themselves once the Maastricht treaty is ratified and agree the directives by majority vote. Again, it would be foolish to go down that route as, eventually, other European Governments will complain that the United Kingdom's action distorts competition within the Community and effectively makes the operation of the single European market—all along the Government have said that they are keen on that—difficult to work in practice. We hope that the Government will take a positive view on those issues.
Perhaps the Government would also like to tell us what view they will take at the European summit at Copenhagen on these matters.
§ The Chairman of Ways and Means (Mr. Michael Morris)
Order. The hon. Lady is stretching new clause 74 rather extensively.
§ Ms Quin
I have given the Minister a great deal of food for thought and I am sure that we all look forward to hearing the detailed response that he will make to the points that I have raised.
My hon. Friend the Member for Wallsend (Mr. Byers) said, a few hours ago, that for us the Maastricht treaty and the social charter go together and I entirely concur with that view. My hon. Friends have also said that it would be reprehensible for the Government, if they are defeated and the House agrees to the motion accepting the social chapter, to thwart the will of the House. That message needs to be made clearly. Whatever legal niceties the Government might want to take refuge in, their position would be politically and morally untenable if they decided to ignore the will of the House as expressed in such a motion.
The arrogance of a Government who were prepared to go to such lengths in such a matter would be punished not only by political opinion in the House but by the country as a whole.
§ Question put and agreed to.
§ Clause read a Second time, and added to the Bill.
§ The Chairman
Order. Before I put the final motion, I should like to place on record my thanks for the support that I have had from the two Deputy Chairmen, the hon. Members for Pontefract and Castleford (Mr. Lofthouse) 597 and for Plymouth, Drake (Dame J. Fookes). The Committee has sat for 163 hours, 131 hon. Members have made speeches, and a further 30 have contributed by way of points of order, making a total of 161.
§ Mr. Garel-Jones
On a point of order, Mr. Morris. At this historic moment, I should like to say a few words on behalf of all members of the Committee. You have just given us some statistics. No doubt the parliamentary "Wisden" experts will, in the coming weeks, let us know whether we have broken any records.
There are two things which I am sure that the whole Committee would like me to say. First, when we come into this House, none of us knows what fate holds in store for us. You, Mr. Morris, have achieved the position of Chairman of Ways and Means. I dare say that from time to time a number of your constituents ask themselves exactly what contribution it is that you make to the House of Commons since you are unable—as are all other hon. Members, because of their position either as Front Bench spokesmen or as Back Benchers—to make the kind of contribution that your constituents often expect you to make. I am sure that the whole Committee supports me when I say that your constituents should be under no illusions whatever, for you are making, and have made, a very distinguished contribution to the House of Commons by the way in which you have conducted yourself and by the way in which you have looked after all of us throughout this Committee stage. I am sure that all hon. Members will also wish to join me in thanking Mr. Lofthouse and Dame Janet for the way they looked after us when they occupied the Chair.
Secondly, you have alluded, Mr. Morris, to the number of right hon. and hon. Members on both sides of the Committee who have contributed to the debates. The hon. Member for Hamilton (Mr. Robertson) is, according to some right hon. and hon. Members, in collusion with me. I see him nodding gravely. Alas, the collusion that I should like to see between the Treasury Bench and the Opposition Front Bench has not taken place quite so fully as I should have liked. Nevertheless, I know that the Committee will wish me to say that the hon. Member for Hamilton has been a regular and distinguished attender of these proceedings.
As for the hon. Member for Inverness, Nairn and Lochaber (Sir R. Johnston), his position on this Bill and on the European Community is different from that of the Treasury Bench and the Opposition Front Bench and, certainly, from that of the other friendly alliances that have existed across the Committee. The hon. Gentleman's party and he himself have held a consistent and honourable view on Britain's position in the European Community, though it is not one that I share.
And so we conclude our consideration of the Bill. Time will tell whether we have broken any records. I have been asking myself what this Bill will be called when, as I believe it shortly will, it becomes an Act. I am told by my officials that its official name will be the European Communities (Amendment) Act 1993. I very much hope that its date will be 1993. I am also told by my officials that, although that will be the official name of the Act and how it should be cited legally, hon. Members are perfectly entitled to call it anything they like. After the number of hours that we have put in, I dare say that hon. Members will have a number of ways of describing the Act and I would not wish to speculate on them.
598 As the Minister of State in charge of the Bill, may I say —I know that my right hon. Friend the Foreign Secretary joins me in this—to all members of the Committee how much I, too, have appreciated the friendly and courteous way in which we have handled the proceedings. If I could introduce a harmonisation measure through the Commission, I should like, without presumption, to introduce one which enabled other Parliaments of the Community to scrutinise European Community legislation in a way which incorporated the interest that hon. Members in all parts of the Committee have taken in the proceedings on this Bill. If there could be more of that spirit throughout the Community, it would be a much better place. Thank you very much, Mr. Morris, on behalf of us all.
§ Mr. George Robertson
Further to that point of order, Mr. Morris. I crave your indulgence in adding a few words to those of the Minister of State in charge of the Bill. I believe that all Opposition parties agree very much with what he said. We are grateful for the understanding and patience that you and your deputies have shown during the 163 hours of debate. If 161 Members have spoken for 163 hours, the average time must be rather peculiar, given that some Members have taken slightly more than the average. Nevertheless, that is a formidable record for those who have had to sit through all that time, those who have had to chair the Committee, stay awake, stay at attention and keep it in order. We are duly grateful for that.
I also endorse what the Minister of State said, although perhaps I should be very wary of endorsing too much of what he says lest people begin to talk, although I suppose that speaking in the Committee stage of the European Communities (Amendment) Bill is as close to speaking off the record as one can get in Parliament. The Minister is right to say that there has been a friendly atmosphere on what is still a controversial Bill, with a number of hurdles still to come. Throughout the Committee stage there has been an element of frankness, of friendliness and of courtesy, to which we should pay tribute.
It is only right to explain at this stage why my hon. Friend the Member for Gateshead, East (Ms Quin) was coming in for some nervous criticism towards the end of her speech. That was entirely my fault, because I had asked her if she would keep speaking until I told her to stop, so that I could complete a task which had to be finished before the end of our proceedings. I then handed her a note of the time for which she has already spoken—28 minutes. My hon. Friend believed that I was asking her to speak for a further 28 minutes and, displaying great skill, while continuing to speak she pencilled the words "No way" at the bottom of my note. So loyal is my hon. Friend, however, that she kept on speaking until the message eventually got through. I take all the blame for that, and no criticism should be attached to my hon. Friend.
Having sat through the Committee stage of the Single European Act as well as the Committee stage of this Bill, I am reminded of one of my favourite quotations from Oscar Wilde:I have never much admired the courage of the lion tamer; after all, inside his cage he is at least safe from other men".I congratulate you, Mr. Morris, and offer you and your deputies our thanks. I am sure that when you are outside 599 the cage, come next Monday, you will look on the Committee proceedings on the Bill with nostalgia but, I dare say, with little regret.
§ Bill reported, with amendments; as amended, to be considered tomorrow.