European Affairs

HC Deb 18 June 2002 vol 387 cc159-248

[Relevant documents: The Thirty-first Report from the European Scrutiny Committee, Session 2001ߝ02 (HC I 52-xxxi), paragraph 2, on the Broad Economic Policy Guidelines, and the Twenty-third Report from the European Scrutiny Committee, Session 2001ߝ02 (HC 152-xxiii) paragraph 3, on the Stability and Convergence Programmes.]

Motion made, and Question proposed, That this House do now adjourn.—[Jim Fitzpatrick.]

3.43 pm

The Secretary of State for Foreign and Commonwealth Affairs (Mr. Jack Straw)

The Spanish presidency will host the next meeting of the European Council of Heads of Government in Seville on 21 and 22 June. Today the House has its customary six-monthly opportunity to debate the Government's priorities for the summit. Five years into this Government's period of office, I believe that we have been able to re-establish the United Kingdom's influence in Europe.

Re-engagement has enabled us to set new priorities for the EU. For example, on economic reform, the so-called Lisbon agenda is now at the centre of the EU' s work programme. We have strengthened European co-operation against crime and terrorism. We are at the forefront of efforts to establish a common asylum policy and in the fight against illegal immigration. With the French, we have promoted the development of a European security and defence capability for use in crisis management, and we have championed the enlargement of the European Union, which will root stability and democracy throughout our continent and should generate up to an estimated £1.75 billion per year in additional business for British companies.

All those achievements have improved the quality of life and security of British people. They demonstrate that this Government are realising the aspiration of a former Conservative Prime Minister to put Britain at the heart of Europe. [Interruption.] I am glad to hear that Conservative Front-Bench Members treat their former leaders in the way they have always done—with disdain and contempt.

Mr. David Wilshire (Spelthorne)

We are all Thatcherites now.

Mr. Straw

I thought that someone might say that. In fact, it was not Baroness Thatcher who said that but the much more recent Conservative Prime Minister, who I thought would be regarded with some kind of affection by his party, at least for a short while—namely Mr. Major.

At Seville, we will be seeking to secure further benefits for British and European citizens. In particular, we believe that the summit should send a signal of our determination to make progress on asylum and immigration and on the reform of the Council of the European Union, to make the whole system work better. I want to concentrate my remarks on these two important issues, as well as talking about two important foreign policy matters that will unquestionably arise at Seville.

First, the current levels of asylum and illegal immigration are Europe-wide phenomena that affect all EU nations. Britain is by no means alone in facing this problem—we rank eighth out of the 15 European Union member states in asylum applications per person. The official statistics significantly understate the problem of illegal immigration in a number of southern European countries where, for reasons of geography and history, they do not tend to count the number of illegals within their borders with the same assiduity as we do. Indeed. there are practical problems in doing so. In addition, because of the nature of the informal labour markets, hundreds of thousands, if not millions, are at large in France, Italy and Spain without having made an application for asylum in the first place.

Austria, which does count, receives two and a half times as many asylum applications as the United Kingdom in per capita terms. Belgium and the Netherlands receive significantly more than we do. Since the collapse of the Berlin wall, and the first increase in asylum applications that came in that first tranche from the Balkans, Germany has had almost three times as many applications as the UK in the past 10 years.

At Seville, we want member states to push for the faster introduction of a common asylum policy and for tough action against illegal immigration. In preparation for this debate, I entertained myself to some lost tablets—the Conservative party's manifesto for 2001. Those who remember the past year's events will recall that no sooner had the Conservative party lost the election than it excised its manifesto completely from its website. We now have to resort to the old-fashioned methods of paper and ink, printing and books, to find the manifesto. It is replete with claims of a pick-and-mix approach to Europe in which, apart from the single market, there were to be new treaty flexibility provisions. The Conservatives were simply going to impose those on Europe—they ignored the minor difficulty of having to obtain the approbation and agreement of the other 14 member states. Under those new treaty flexibility provisions, Countries need only participate in new legislative actions at a European level if they see this as in their national interest". Opposition Front-Bench Members are obviously still signed up to that—[Interruption.] Well, the shadow Leader of the House remains signed up to that statement, but evidently the other Members on the Conservative Front Bench are not. Some things never change—including the visceral divisions on the Conservative Front Bench and, indeed, the poor taste displayed by the ties worn by the shadow Leader of the House.

Thinking Opposition Members will at least agree that there is cross-party agreement about the need to take firmer action throughout Europe to deal with the problems of asylum and immigration flows that affect all countries in Europe. If we are to do that, we have to achieve a level playing field—to use a cliché—so that we end asylum shopping. We all have to accept the same principal definition in the 1951 convention, but member states operate differing interpretations of the convention and different administrative practices. The only way to deal with that is to have a common policy commonly applied across Europe. That would not and could not have been possible had the Conservatives won the last election and allowed individual member states to suit themselves as to whether they opted in or out of all legislation affecting the EU.

Mr. Michael Ancram (Devizes)

While the right hon. Gentleman was rooting around for previous manifestos, did he have a chance to check the 1983 Labour manifesto on which he was elected? Will he remind us of his party's position at that time and tell us whether he still adheres to the manifesto on which he was elected?

Mr. Straw

Not only do I remember almost every page of the 1983 manifesto, but also every page of the 1982 Labour programme which was very much longer and even more at error than the 1983 manifesto. I am surprised that I was not asked about that programme, as it illustrates the infection that had overtaken the Labour party at that time. Happily, the only way to cure such an infection is to pass it on to another party, and the Conservatives have now caught it. On page 79 of that programme, three paragraphs set out Labour's detailed commitment to establish a system of local authority licensing of horse dealers. That was in 1983, not 1883.

I mention that because it illustrates the mindset that infected the Labour party at that time—[HON. MEMBERS: "What about the answer?"] The answer is that I do not agree with what we said then—[HON. MEMBERS: "Ah."] That is the answer; I thought it would have been obvious. The important question is about whether the Conservative party subscribes to a manifesto that is only 13 months old, not about a manifesto written for an election 19 years ago.

Mr. Frank Field (Birkenhead)

Earlier, my right hon. Friend said that he hoped that, after the summit, we would have a common policy in Europe on asylum seeking and illegal immigrants. I thought that we already had a common policy, and that the problem was that it was not implemented. Is not the basis of that common policy the idea that people have to register their status as asylum seekers in the country where they first arrive? Is not the problem for us the fact that our partners in Europe do not implement that existing common policy?

Mr. Straw

That is part of the problem. However, it is one thing to set out the principle and another thing to ensure that it operates in practice. One of the difficulties that I faced as Home Secretary from October 1997 was that at that time, thanks to decisions made by the Conservative Government during the previous seven years about which I could do nothing, the former gentlemen's agreement on asylum seekers who ended up in the United Kingdom was finished. Under that agreement, if we could establish within a seven-day period that someone had come from France—regardless of the EU country of their original entry—we could send them back. That agreement finished and in its place came the Dublin convention, which has turned out to be a bureaucratic nightmare. We are now seeking to renegotiate it, but funnily enough, that requires the agreement of the other 14 member states.

Mr. Field

rose—

Mr. Straw

I should tell my right hon. Friend—I shall then give way again—that, meanwhile, under articles 62 to 67 of the Amsterdam treaty, with which he will be familiar, it was agreed, not least on the United Kingdom's initiative by my right hon. Friend the Prime Minister, that there should be more detailed provisions requiring the introduction of what amounts to a common application of the asylum policy and common rules of procedure.

Mr. Field

I appreciate the fullness of that reply, but during the general election campaign and since, the view of many of my voters has been that the country that offends most against the common policy is France. As the Government are trying to get the French to play on a level playing field, I wonder whether they have considered sending our immigration officials to French camps so that the processing can take place on French soil. The two Governments could then agree on what to do with those people who are not asylum seekers, but are, quite understandably, economic migrants whom we may or may not wish to have.

Mr. Straw

During my period as Home Secretary and under my right hon. Friend the current Home Secretary, we have certainly been ready to send all kinds of advisers to France and other countries. Indeed, there is a great deal of contact between the two immigration and asylum services. I should add that my right hon. Friend the Home Secretary has already met his opposite number M. Sarkozy, the new Interior Minister, and is due to meet him again next week. I have had a series of discussions with my new opposite number Dominique de Villepin. The new French Administration is so far—it is early days—showing a constructive approach to trying to resolve this issue in a mutually acceptable way.

There is however a difficulty in the proposal of my right hon. Friend the Member for Birkenhead (Mr. Field). I am sure that my right hon. Friend the Home Secretary does not dismiss it out of hand, but the difficulty is that, if we were to process applicants in France, we would have to accept responsibility for them, even though the appropriate country for them to apply for asylum in would be either France, because they were there, or the original EU country in which they arrived if that was not France. They might have arrived in a country further to the east.

I should also tell my right hon. Friend the Member for Birkenhead that, as every EU country knows, even when a decision has been made to reject applicants, the question then arises of what to do about those applicants and how to get them back to the country whence they came. Unless such people were to be incarcerated in increasing numbers—

Mr. Field

They are in a camp at the moment.

Mr. Straw

I understand that, and it is a very suitable camp, too. As I say, I do not rule out my right hon. Friend's proposal. Obviously, all constructive suggestions, including my right hon. Friend's, are being considered by my right hon. Friend the Home Secretary.

Mr. George Foulkes (Carrick, Cumnock and Doon Valley)

Will the Foreign Secretary give way?

Mr. Straw

Yes, and then I shall make some progress.

Mr. Foulkes

I thank the Foreign Secretary for the representations that he has made regarding security at the Frethun camp. Will he give an indication of when he expects the French authorities to have adequate security protection at Frethun, so that the disruption to freight services to the continent from the United Kingdom can be ended?

Mr. Straw:

I cannot give my hon. Friend an exact time scale, but I can say that my right hon. Friend the Home Secretary and all other Ministers, and their equivalents across the channel, are well seized of the urgency of taking action. My hon. Friend will be aware that the European Commission has threatened to take proceedings against the French Government for their failure properly to protect the freight terminal at Frethun, as well as to take other action to protect the channel tunnel's assets, and the Commission is quite right to do so. I am pleased that the present French Government have so far shown a constructive approach. I have to say that I found dealing with their predecessors extremely frustrating on this issue, because they did not deliver that which they said that they would.

I ought to make a little progress. The need for the new approach to a common asylum policy and to take tough action against illegal immigration is not about the creation of a fortress Europe. Immigration has made and continues to make a vital contribution to European cultural and economic life. We all now recognise, however, that if we fail to manage the flow of illegal immigration and unfounded asylum seekers, we risk destroying the consensus that we should provide refuge for those genuinely fleeing persecution. As we have seen in recent months, politicians on the far right across Europe have been only too willing to exploit this issue for electoral gain. In response, it is incumbent on us all to deal with the issue responsibly and sensibly.

As I have indicated, we have long recognised the importance of moving towards a common asylum system. Britain played a leading role in framing the action plan on asylum at the Tampere summit in 1999, in Finland, which I was privileged to attend; but the EU has since been unable to achieve many of the milestones that were agreed there almost three years ago. For all EU member states, progress has been slow on returning failed asylum seekers to their countries of origin, and in implementing measures to strengthen the EU's external frontier.

At Seville, we intend to inject new urgency into the Tampere commitments. We must reduce the numbers of illegal immigrants seeking to come to Europe in the first place, return more of those whose claims fail, and tackle the criminality behind this trade in human misery. We need a common asylum policy, a stronger external border for the EU, and a new approach to source and transit countries.

Again, as I have indicated, a common asylum policy would mean uniform standards for receiving asylum seekers arriving anywhere in Europe, and fixed procedures for dealing with those applications. That would prevent asylum seekers from "shopping" for the best point of entry and from making multiple claims in different countries. That also requires a co-ordinated information base and co-ordinated fingerprinting systems to track the claims.

At Seville, as well as arguing for a common administrative system and common standards, we will be calling for urgent action to strengthen the EU's external border. That should include joint work to identify weak points in the current and future external border, and on key transit routes for illegal immigrants into Europe; and joint operations to strengthen any such weak links. That should enable us to target trafficking gangs and track down forgers and transporters.

Mike Gapes (Ilford, South)

Three weeks ago, I was in Bulgaria with the NATO Parliamentary Assembly. I had discussions with the Interior Minister there. The Bulgarians in particular, because of their location and their potential in a few years to be the eastern border of NATO and the EU, will face great pressures. Can my right hon. Friend talk to his colleagues in Government about strengthening the support that we give to Bulgaria, Romania and other countries in the Balkans on these matters?

Mr. Straw

Indeed, I can. I was going to come on to say that we will also be calling for the strategic use of Community funding to assist countries, especially those on the eastern border—or what is likely to become the eastern border—of the EU. The cost of defending that border in an expanded EU should not fall disproportionately on those least able to afford it.

Kate Hoey (Vauxhall)

My right hon. Friend has talked about extra Community funding for countries in eastern Europe. Would he consider whether there might be a way in which the Government can provide more support and help for boroughs such as mine in inner-city areas? Not a single person in my borough of Lambeth now has a chance of being rehoused, because every single empty flat is being allocated to an asylum seeker or an economic migrant. Surely the real problem is that we treat our economic migrants much less harshly than France does. No wonder they want to come to this country.

Mr. Straw

First, I will ensure that my hon. Friend's concerns for her constituency are followed up. I happen to be one of her constituents, along with many thousands of others, and if I may say so, she does a brilliant job as our Member of Parliament, and is held in high regard by all her constituents. I am also my own Member of Parliament, but I shall not comment on the kind of service that I receive from myself.

The question of why people come to this country is complex. It has to do with some factors that we cannot do anything about, or do not want to do anything about. For example, they include the fact that English is our language, that our economy is doing better than those in other countries, that the London economy, in particular, is doing very well, and that a quarter of the people in London are drawn from ethnic minority communities of one kind or another. There are a whole range of issues—and yes, we also treat people decently.

In France the number of asylum seekers is, and has been, rising but I accept the case that my hon. Friend makes for taking the pressure off places such as inner London boroughs and south coast resorts. That is one of the reasons why I introduced the dispersal policy, which I happen to think was a relative success.

Mr. Mark Prisk (Hertford and Stortford)

Throughout our discussion of what are, after all, the central issues for this country—the control of asylum seekers, border controls and immigration—the Foreign Secretary has spoken about the essential importance of commonality across the European Union. Can he tell the House what the Government's exact position will be on giving away a little control, in the form of qualified majority voting, on such issues? Does he intend to do that or not?

Mr. Straw

On asylum, the hon. Gentleman will probably be aware that under article 67 of the Amsterdam treaty, the House approved—

Mr. Prisk

What about Seville?

Mr. Straw

Seville is not an intergovernmental conference, so there is no issue of treaty renegotiation. The powers necessary to apply the policy are in the treaties. Under article 67, there is provision by which the Council can move by unanimous vote to qualified majority voting in certain areas of asylum and immigration policy. We wish that to be used for certain areas of asylum policy, but that is quite separate from the issue of whether our veto and our opt-out in respect of our border controls for immigration purposes are maintained. The position on that is absolutely clear. We shall maintain our veto and opt-out for border controls and for normal immigration purposes.

I know that Members on both sides of the House sometimes confuse the two issues, but they should not be confused. They are two very separate issues. One is about the routes of legal immigration into this country, for which we need our own controls. The second is about the routes for illegal immigration into this country and the rest of Europe, and there it is very much in our interests to have a common application of common principles—to which we are, in any case, signed up under the 1951 convention.

Mr. George Howarth (Knowsley, North and Sefton, East)

My right hon. Friend said that Britain's economic success was one of the reasons why people wanted to come to this country. On the point about Britain's economic success, may I ask, as one old Eurosceptic to another, whether he agrees that the argument about whether it is right in principle to join a single currency was largely dealt with during the debates on the Maastricht treaty and the Single European Act? It is now a technical rather than a political matter. That being so, does my right hon. Friend agree that in addition to the Chancellor's five tests, it might be a good idea to ask the Governor of the Bank of England to take advice from wherever he thinks it appropriate and advise the Government and Parliament as to when the time might be right to enter the single currency?

Mr. Straw

My hon. Friend is a good and old friend—and I may say, between friends, that there was no necessity to drag out my previous convictions in that way. I will draw his views and suggestion to the attention of my right hon. Friend the Chancellor of the Exchequer. The Government's position was well set out in my right hon. Friend's statement of 27 October 1997, and that remains our policy as stated.

We must tackle the long-term causes of illegal immigration and asylum seeking, such as the poverty and instability that lead to migratory pressures into Europe. That means the development of an effective policy towards source and transit countries for illegal immigration. Our goal is to strengthen the European Union's partnership with such countries, confronting the problems at the point of origin and, where necessary, providing targeted assistance.

We also need to take more immediate action. We have to make it clear to source and transit countries that co-operation with the EU in this field is of the utmost importance, and that working with us will strengthen their relationship with the EU and create the advantages that they want. As my right hon. Friend the Home Secretary said, we are proposing a positive conditionality. For example, if source countries are prepared to take back their own nationals, many of whom will have valuable skills and experience, then we are prepared to help.

Roger Casale (Wimbledon)

I welcome the recognition of the need for a common asylum policy, and what my right hon. Friend says about source and transit countries. Just as we work with countries within the EU, it is also important that we work collectively with countries outside the EU to regulate migration flows. In the respect of framing a common asylum policy, will my right hon. Friend look closely at the experience of previous Italian Governments who have worked with countries in north Africa to develop a three-pronged approach? First, they have worked closely with the security forces in north African countries; secondly, they have accepted a quota of legal migration; thirdly, and importantly, they have provided investment and assistance to help the economic development of those countries to abate the pressures for economic migration in the first place.

Mr. Straw

I pay tribute to my hon. Friend's work on European co-operation. I will definitely take forward his positive suggestion, which is based on much experience of southern Europe.

The EU's tardiness in acting on the Tampere agenda shows that even with just 15 member states it does not act as effectively as it should. Our public wants a Europe that delivers. If we are to meet that demand, the Union's institutional structure must be overhauled.

Britain has taken the lead in the debate on institutional reform. Almost two years ago in Warsaw, my right hon. Friend the Prime Minister mapped out his vision of how the EU should develop in the 21st century. In The Hague earlier this year, I set out specific proposals for EU reform to prepare not just for the challenges of enlargement, but for the here and now—for the changes that we need to make now if the EU is to work better. We have to make the Union more effective, more democratically accountable and better understood. We should spell out more clearly for the public what the EU is for, what it is not for, and how it enables nation states to achieve more together than they can achieve alone.

Reforms requiring treaty change will be taken by the next intergovernmental conference in 2004. The IGC will, of course, be informed by the report of the convention on the future of Europe. I am glad to see in the Chamber my right hon. Friend the Minister for Europe, who sits as the Government's representative on the convention, my hon. Friend the Member for Birmingham, Edgbaston (Ms Stuart), who is one of the two parliamentary representatives from this House, and the right hon. Member for Wells (Mr. Heathcoat-Amory), who represents the official Opposition. I pay tribute to all three for their work, which I know has involved considerable effort. I also pay tribute to the work of Lord Tomlinson, Lord Maclennan, who sits on the convention for the Liberal Democrats, and Baroness Scotland, who is one of the alternates representing the Government.

A key issue before the convention is the presidency of the Council. We believe that we need a more consistent and co-ordinated approach than the current six-monthly rotation allows. We have advocated the appointment of national chairmen for each of the specialist Councils for a longer period of, say, two and a half years. Those chairmen might act as a sort of team presidency to ensure that the strategic direction given by the European Council is properly followed through.

Although the Seville Council, which will take place soon, cannot itself take any decisions on reforms requiring treaty change, we will press for the adoption of several other measures to improve the efficiency of the Council and make the Union more accessible to the public. The Secretary General of the Council, Javier Solana, has made a series of proposals for Council reform and they will be the basis for discussion. His recommendations focus on injecting greater strategic coherence into the Council, splitting the General Affairs Council into a foreign affairs council and then separately into what is called a horizontal council, which co-ordinates across the work of the functional councils, reforming the presidency system, and increasing transparency. That is largely our agenda.

Mr. Keith Vaz (Leicester, East)

I pay tribute to my right hon. Friend's work on the reform agenda in Europe. He will know that when the Prime Minister and Chancellor Schroder wrote to the Spanish Prime Minister on 25 February, they set out 20 points for reform, which they hope will be implemented by the European Council meeting in Seville. How many of those points does my right hon. Friend think will be met at that meeting?

Mr. Straw

I am grateful for the tribute, as well as for the difficult question that followed. I cannot give my hon. Friend an exact figure—[HON. MEMBERS: "Oh."] My excellent Minister for Europe will give the answer in his winding-up speech, and as I know that all right hon. and hon. Members who are here at the beginning of the debate will show proper respect to the Chair and be here at the end, too, there will be no punishment involved in waiting for my right hon. Friend to give that answer. Although I do not have the exact number, I can tell my hon. Friend (Mr. Vaz) that a significant proportion of those 20 points, which are capable of non-treaty implementation, will be agreed at Seville. [Laughter.] The mockers will become the mocked. If Conservative Members want the European Union to work better, they should be supporting these changes, including the one that I am about to talk about.

One thing that has tended to jam up the agenda of the European Council of Heads of Government is that it has become a court of appeal for the functional councils. A member state in such a council, facing a defeat under QMV, can effectively veto a proposal by saying that they will take the matter to the European Council where, notwithstanding the requirement in the treaties that the matter be dealt with by QMV, it has to be dealt with by consensus. That means that the agenda of the European Council has become increasingly constipated by items that could and should have been sorted out by a functional council, or certainly—because the treaties say so and because it is sensible—should have been decided by QMV. We support the recommendation—it is one of the 20—that the European Council should adopt QMV for issues that have been subject to QMV in the functional councils.

We also share Mr. Solana's concerns about transparency, and at Seville we will be supporting the introduction of television cameras into councils when they are legislating. Those are important reforms. They tell voters that the politicians whom they elect and can dismiss set the agenda and take the decisions, and that is an important part of the public presentation of Europe. It is not the oft-reviled and misunderstood Brussels bureaucrats who make decisions; it is elected politicians, and so it should be.

Angus Robertson (Moray)

I fully support the Foreign Secretary's point about increasing transparency in the Council of Ministers, which will provide access and information and allow the public to understand how European policy is made. Why do the Government not support that within the UK, and reform the concordats covering European business between the UK Government and the devolved Administrations, so that we can fully understand the discussions that take place between Ministers in London, Edinburgh, Cardiff and Belfast?

Mr. Straw

The hon. Gentleman raises a serious question, which we discussed at some length during the many debates on the Freedom of Information Bill of blessed memory, which is now an Act. It is important to balance transparency against the opportunity to be involved in confidential discussions while alternatives are being developed.

Everybody accepts that argument as it applies to their own party, because parties could not operate if their key decision-making bodies had to work in the full glare of publicity. I dare say that applies to the hon. Gentleman's party as well as to any other. UK Cabinet Government could not operate in that way, nor could the Executives in Scotland, Wales and Northern Ireland—nor, indeed, could the General Affairs Council, as was pointed out yesterday in its discussions. The natural give and take that is essential if decisions are to be reached, whether by majority or by unanimity, must take place in a rather informal setting. That could not happen if every judgment and every contribution that we made was written down and could be played back against us by Oppositions. This is a matter of balancing the way in which decisions are developed with the way in which they are made formally.

We accept that when we change the law of Europe, and therefore, by definition, the law of individual nation states, that process ought to be transparent and in public. However, if we followed the hon. Gentleman's route, there would not be more transparency and accountability but less, because the real decisions would then be made in informal meetings outside the formal rooms. That would produce the opposite result from the one that he seeks.

Mr. Robert Walter (North Dorset)

I am a little worried about the Foreign Secretary's qualification concerning the presence of the television cameras in the Council. He seems to be suggesting that they will be there just for the formal vote, not for the debate, so we will not know what positions various member Governments have taken in the Council in arriving at that decision.

Mr. Straw

The cameras would be there not just for the formal votes, but for the points of legislation. As for negotiations over text, I defy anybody who has had any experience of negotiations over texts to say how having television cameras recording every last detail of the negotiation of texts would assist the process of negotiation. It simply would not be possible. Everybody who knows about negotiations knows that to be the case. It would not be possible under a Conservative Administration, and it is certainly not possible under the present Administration. We are not in favour of it.

The case for institutional reform of the kind that I have just described would be clear-cut even if the European Union were forever to be just 15 strong, but it becomes urgent with the impending expansion of the EU into southern, eastern and central Europe. I do not want to pre-empt the decisions on enlargement due later this year, but I hope that the Seville Council will reiterate our commitment to the conclusion of negotiations with the 10 applicants by this December, allowing them to join in 2004.

In Berlin last month I set out the case for a large enlargement. Experience tells us that we need more, not fewer, partners to tackle the issues that concern our citizens—more countries working in an EU framework in the fight against illegal immigration; more resources to defeat global terrorism; and more co-operation to shut down drug and people-smuggling routes.

We have all gained from previous EU expansions and I believe that we will gain in the future. In the 1980s enlargement underpinned the reintroduction of democracy in Spain, Portugal and Greece. It has encouraged growth and mutual prosperity both in those countries and across Europe. For those of my generation, it is worth remembering that 35 years ago Spain, Portugal and Greece were fascist dictatorships. Many of us refused to visit them because of the politics of those countries, but none of us could have anticipated that 35 years later they would be fully active members of the European Union.

Since the accession of Spain to the EU, its trade with the UK has increased by over 400 per cent. Expansion has led to considerable migration, but more from the old member states to the new than vice versa. That makes the point that we must all acknowledge: the principal motor of migration is economic imbalances. As the imbalances between the Iberian peninsula and the rest of the European Union have changed, so migration patterns have changed. The figures for France and Spain are interesting. In 1986 when Spain joined the EU, there were 109,000 Spanish workers in France; by 1994 that had fallen to just 35,000. People went back to Spain for work.

For all EU member states, enlargement should not just be about an historic obligation to reunite Europe. It is also a matter of enlightened self-interest. If we want to deliver economic prosperity, a cleaner environment and safer streets for our citizens, we should embrace enlargement, not postpone it.

Before I close my remarks I should add that, as usual, there will be a discussion of major foreign policy and security issues at Seville.

Roger Casale

I am grateful to my right hon. Friend for giving way again. May I draw his attention to the forthcoming report of the Select Committee on European Scrutiny, which will be published later this week, on democracy and accountability in the European Union? I shall not anticipate the findings of the report, but my right hon. Friend will know that part of its remit was to consider the role of national Parliaments. Does he agree in principle that if we upgrade the role of the Council of Ministers and the role of Governments, we should also upgrade the role of national Parliaments in EU decision making? Does he also agree that national Parliaments can be a very good bridge to citizens in terms of involving and engaging them in EU decision-making processes? Will he give his support to any appropriate practical measures that can be considered to improve and upgrade the role of national Parliaments in EU decision making?

Mr. Straw

I answer with an emphatic yes, as I am very strongly committed to strengthening the role of national Parliaments in the decision-making and supervisory processes of the European Union. I believe that that is one of the most important ways of ensuring that the European Union not only stays connected to its electors at an institutional and supranational level, but is increasingly better connected to them. I think I am right in saying that my hon. Friend the Member for Birmingham, Edgbaston (Ms Stuart), as a representative of the national Parliament, is on a working party on the role of national parliaments as part of her job as a member of the praesidium of the convention. If I am wrong, I am sure that someone will correct me.

Ms Gisela Stuart (Birmingham, Edgbaston)

I am chairing it.

Mr. Straw

I was wrong, but happily so. I congratulate my hon. Friend on holding that position.

I look forward to the report to which my hon. Friend the Member for Wimbledon (Roger Casale) referred. I hope that the whole House will pay careful attention to the constructive proposals from the convention and from his Select Committee about how we can better insert the national Parliaments into the operation of the European Union.

I now want to deal with two important foreign policy matters. First, the middle east will feature on the convention's agenda for sure. Yet again, discussion about it will be overshadowed by a further terrorist outrage: the suicide bombing that took place this morning. As I left the Foreign Office, 17 people had been reported killed and 40 injured, and it is quite possible that the toll is rising. I should like to place on record our belief about the totally despicable nature of this attack, in which so many innocent people have again lost their lives: the detonation of a bomb on a bus carrying schoolchildren is an act of evil beyond words. I am sure that the whole House will want to join me in sending out our condolences and sense of grief to the victims' families, to those who were injured and to those who are trying to tend to them.

All of us understand the depth of feeling that exists on both sides in the middle east conflict. In our view, none of us should ever seek to justify—indeed, it cannot be a matter of justification—the use of terror against innocent civilians to advance a political cause. Yes, I note that the Palestinian Authority has condemned the attack, but it has to demonstrate to the international community that it is making effective efforts to crack down on terrorism and deal with the utterly evil people who organise the suicide bombers. Yes, they send other people to their death, including the bombers, but they never send themselves to death. They are willing to use the deaths of their own people, as it were, as well as the deaths of innocents on the other side, to seek to advance their cause. The last thing that I shall say about this matter is that their cause cannot be the true cause of the Palestinians. Every time such terrorism takes place, it reduces the support and understanding in the rest of the world for the true cause of the Palestinians—a peaceful settlement of this terrible dispute with Israel.

Mr. Alan Duncan (Rutland and Melton)

In identifying Opposition Members totally with what the Foreign Secretary has said about suicide bombings, may I ask whether he will advise the House during the next few minutes of what his policy and that of the EU is likely to be on the construction of a fence and trench dividing Palestinian land from Israeli land?

Mr. Straw

We had a brief discussion yesterday on the middle east, including that issue. We decided to delay comprehensive discussion, which will probably take place on Friday at dinner, as we anticipate a major statement by President Bush on the issue. Obviously, we will make a full report, or a full report will he made by my right hon. Friend the Prime Minister on that part of the discussion in his statement on the conclusions of Seville next Monday.

I shall now deal briefly with the other major issue—Kashmir. I set out our position on Kashmir in a statement to the House on Monday last week. Since the resurgence of violence in recent months, the issue has been high on the European Union's agenda. There has been intense diplomatic activity by the EU countries, as well as the United States and the United Kingdom, and Commissioner Chris Patten visited the region last month. I welcome assurances from President Musharraf that he is taking steps to crack down effectively on cross-border terrorism, and I am pleased that in recent days India has taken significant steps to reduce tensions.

I hope that at Seville, EU leaders will underline the need for Pakistan to take visible, decisive and verifiable steps to seal the line of control, to stop supplies to militant groups and help to restrain their violent activities, and to close the militant training camps on Pakistan's side of the line of control. I hope that EU Governments will also support our call for the Indian Government to improve the human rights situation in Jammu and Kashmir, and to ensure that free, fair and inclusive elections take place there this autumn.

Let me now come back to the central agenda for Seville. The EU has now been in existence for 45 years, and the UK has been a member for two thirds of that period, since 1973. It is a political institution without parallel in history, and has rightly aroused huge debate and controversy here and in continental Europe—long may that continue. I am in no doubt, however, that its historic achievement, alongside NATO, has been remarkable. It has secured long-term peace with prosperity across a continent whose previous normal experience was conflict and turmoil. None the less, if the Union is to develop further it has to look forward and respond not to yesterday's problems but to the challenges of today and tomorrow.

The Seville Council is a chance to show European voters that we are determined to deliver outcomes for our citizens within the framework of a Union that can earn and maintain popular support. As usual, we will be working with our European partners to achieve our goals through negotiation, not confrontation. Our experience in Europe shows that by building partnerships and working wholeheartedly with our friends in the European Union we can deliver—we have done, and will do so in future—practical reforms and benefits for the British people.

4.32 pm

Mr. Michael Ancram (Devizes)

I congratulate the Foreign Secretary on his choice of debate today, as 18 June commemorates one of the most comprehensive defeats for European integration and the creation of the European superstate—the battle of Waterloo. He may well recall that on that occasion unexpected intervention by one of our European partners helped us to win the day.

Mr. Straw

There is a much more recent anniversary—18 June is the thirty-second anniversary of a victory that the Conservative party wishes to forget. On 18 June 1970, Sir Edward Heath won the election that led to Britain going into Europe.

Mr. Ancram

It is a date that I remember very well, as that was the first time that I stood, unsuccessfully, for election to the House. It is therefore engraved on my heart.

One of the better developments in the six months since we last debated European affairs is the warming of relations between Russia, Europe and the United States. We welcome the new framework of relations between Russia and NATO, which will allow deeper and more fruitful co-operation between the present NATO countries and Russia. Closer ties between Russia and the rest of Europe may lead to greater security but could also act as a catalyst for greater prosperity in Europe and beyond. It was therefore right that the European Union recognised Russia as a market economy.

Also in the past six months, in the Balkans, Serbia and Montenegro have moved peacefully and uniquely towards a new constitutional relationship. Conservative Members welcome President Kostunica's ratification of the new federal agreement between Serbia and Montenegro. Everything possible must be clone to help to ensure that Serbia and Montenegro stay on a course of peaceful political development and that the political changes taking place in Yugoslavia are not allowed to stand in their way.

The Foreign Secretary mentioned enlargement. As he knows, we support enlargement and believe that it is one of the most important European developments. Our support stems from our experience in government when the communist bloc in the east finally collapsed, and we made it clear to the peoples of eastern Europe that Britain was their friend. Enlargement is an opportunity to promote peace and prosperity among all the nations of Europe, but it does not come without problems.

Kaliningrad remains a serious problem, and progress on devising suitable arrangements for that Russian enclave seems to have halted. The region already endures enough misery from unemployment, pollution and AIDS without the European Union adding to it by isolating it from the main mass of Russia. We must ensure that that difficult matter does not harm the relations of the Baltic states and Poland with Russia or their economies, nor should we allow Kaliningrad to become a gateway to Europe for crime. I hope that the Foreign Secretary will do all that he can to ensure that that problem is turned into an opportunity both for the European Union and for Russia.

Mike Gapes

The right hon. Gentleman referred to his party's policy of having for many years favoured enlargement of the European Union. Can he therefore explain why Conservative Members consistently opposed measures to introduce institutional reforms such as majority voting, without which effective enlargement would be impossible?

Mr. Ancram

I sometimes wonder whether the hon. Gentleman ever listens to debates in this House, because we have covered this topic on many occasions. Sometimes the Government tell us that the Nice treaty is necessary for enlargement, and sometimes they tell us that it is not. As the hon. Gentleman knows, Nice was about much more than enlargement, and later I shall turn to other matters about which Conservative Members have genuine and justified concerns.

The opportunity that enlargement presents is not guaranteed. Signs of opposition have recently arisen in the European Union, and those reservations must be addressed. If the target of 2004 is missed, many eastern European countries will justly feel that the European Union made promises to them in bad faith, and some may be disinclined to carry on with what is proving a costly and burdensome administrative process. That would be regrettable, and we should seek to reverse that trend.

Time and again we have warned that the current structure of the European Union—the vast, inflexible mass of the acquis—is not conducive to building a wider Europe that delivers the jobs and wealth that its peoples want. Nor does it make accession to the EU easy. It is universally acknowledged that enlargement will be financially unsustainable if the common agricultural policy and structural funding are not reformed. For instance, unreformed enlargement will increase expenditure on structural operations from £20.73 billion to £43.539 billion by 2010. There has still been too little movement towards reform.

Mr. John Gummer (Suffolk, Coastal)

Does my right hon. Friend accept that the situation is made much more difficult by President Bush's determination to make the American farmer the most subsidised farmer in the world by increasing by 60 per cent. the amount of money that he receives? That undermines the position of those of us who have sought reform in that context in the European Union and does great damage to developing countries.

Mr. Ancram

I share my right hon. Friend's concern, but President Bush's actions will not bankrupt the European Union as could unreformed enlargement.

Mr. Kelvin Hopkins (Luton, North)

Farming communities in Poland are deeply worried that they could be flooded with cheap, subsidised produce from western Europe instead of benefiting from the CAP. Does not that necessitate fundamental reform of the CAP?

Mr. Ancram

I am grateful to the hon. Gentleman for making the point better than I could have. If enlargement is to work, it is essential to tackle the CAP.

It was worrying, if all too predictable, that the General Affairs Council on 10 June decided to postpone until the autumn talks on the amount of aid to be offered to the candidate countries I am aware that some progress may be apparent in the mid-term, but we face the prospect of keeping to the Berlin budgetary limits only by treating the new states of the European Union as second-class members for their first 10 years while doing nothing to push through the necessary fundamental changes. That is unacceptable.

I hope that the Foreign Secretary will affirm that it is essential that the outlines of CAP structural funding reform are agreed before 2004. We cannot afford to allow the CAP to continue as it is—never at the top of the EU's list of priorities—or to become entrenched by enlargement. That would do damage almost all round.

Roger Casale

The right hon. Gentleman claimed that institutional reform was not necessary for enlargement. Not only the Government but the House said that such reform was important for enlargement when hon. Members debated the EU scrutiny report that recommended it. Every Government and Parliament that I can think of in Europe also believes that. Most important, the applicant countries believe that institutional reform is necessary. The right hon. Gentleman is in a minority. If he does not accept that institutional reform is necessary for enlargement, does he accept that it is necessary for reforming the CAP? Or is he, once again, willing the ends without the means?

Mr. Ancram

I am rather puzzled by that. I said that the Nice treaty was not necessary for enlargement. At one stage, the President of the Commission agreed with that. However, I did not say anything further. Fulfilling the target of enlargement by 2004 is a challenge; failure to achieve it would rightly lead to harsh judgments of the member states' Governments.

The second challenge is that of making enlargement a success. We must ensure that the effect of accession on the new member states resembles that on Portugal rather than that on East Germany. It would pose problems for old and new members if enlargement's main consequence was to encourage a mass movement of workers from east to west rather than a mutually beneficial enrichment of expanded markets for us, and a helping hand to greater prosperity for them.

The Foreign Secretary spoke about the European meeting in Seville this weekend. I was disconcerted by his admission that he was setting off for Seville without being quite clear about what he intended to achieve when he arrived. I look forward to hearing about his intentions when the Minister for Europe has received the benefit of advice and can tell us what his officials have written in the communiqué if not yet in the Foreign Secretary's brief.

We will watch events in Seville closely this weekend to ascertain, for example, whether the Government believe in a Europe of nations or are determined to lock Britain into a centralised, supranational union. The Government appear confused. In November, the Foreign Secretary wrote: Nation states are and will remain the foundation of international order". I concur with that. However, a month later, he signed up to a political union in Laeken that would establish a supranational Europe. He cannot have it both ways.

We will also watch for the Government's attitude in the summit to the urgent reforms that the European Union acknowledges it needs.

Mr. Straw

The right hon. Gentleman quoted me accurately the first time, but will he cite the part of the text of Laeken on which he relies, and explain how I signed up to it?

Mr. Ancram

It is my understanding—[HON. MEMBERS: "Ah."] Perhaps hon. Members will listen. The Laeken agreement constituted the first time that political union was stipulated in terms of a treaty. The Government signed up to it. The right hon. Gentleman should check that or take advice so that perhaps the Minister for Europe can clarify the matter at the end of the debate. He will find that I am right.

Mr. Straw

If we are to have effective debate, it is important to present the sources. No one signed up to the idea of a supranational Eurostate; we would not have done that. The Laeken declaration simply sets a rather discursive agenda for the convention on the future of Europe. It contains nothing that could form the basis for the right hon. Gentleman's claim.

Mr. Ancram

Is the Foreign Secretary telling us that there is a difference between a political union and a supranational state? He will have to be a casuist to prove that point.

I return to what I was saying about the second challenge. We shall also watch to see what attitude the Government take in the summit towards the urgent reforms that the European Union itself recognises it needs. We hope that that issue will not be ducked. As we have heard today, the Government have proposed a number of reforms to the European Council. When I first heard some of them, I thought that the right hon. Gentleman was joking.

The Government's answer to the popular feeling of alienation from European institutions is, apparently, to create an even more remote and more permanent presidency. That may bring some short-term comfort to the retirement plans of the Prime Minister, but it will do nothing to bring Europe closer to its peoples. If we look at the sum of the rest of the proposals that we heard about today, they merely tinker with the problem faced by Europe. By contrast, one of the few decent ideas that the Government have put forward—the creation of a subsidiarity panel—is one that they have taken from us, and we are most appreciative of the compliment.

We have also heard that the Foreign Secretary is going to discuss asylum, with which he dealt at some length in his speech. I welcome—along with their seeking a workable common approach—the Government's plans to discuss the implementation of bilateral agreements such as the one that we had with France until 1997. We have been calling for that for the last eight months. A higher level of co-operation between European Governments on asylum is a necessity, and bilateral agreements are one of the most effective ways forward.

The Council will also provide an opportunity to take in hand the Commission's paper on the reform of EU governance. We welcome some of the proposals. We support, for example, the plans to consult sooner and more deeply with interested parties on legislation. That policy is long overdue, and needs to be extended to other institutions within the Union. We certainly endorse the need to simplify and shorten the acquis communautaire. Indeed, we would go further. However, if the Commission can cut it from about 80,000 to 60,000 pages, that will at least be a start. If that had been done earlier, it would have made enlargement easier.

The Commission's proposals on the future shape and powers of European institutions, however, show little understanding of the need for more democracy in the EU. They fail to recognise that the nation states, not supranational bureaucracies, are the fundamental elements of the European Union. Surprisingly, the Government have said that they are "very relaxed" about the proposals. Are they seriously happy with the general centralising drift that has come out of the Commission?

Mr. Foulkes

I want to know whether the shadow Foreign Secretary is serious in what he is saying. Will he remind me which Prime Minister, and which Government, forced the Maastricht treaty and the Single European Act through the House on a three-line Whip and a timetable motion?

Mr. Ancram

It is a pleasure to be able to congratulate the hon. Gentleman on being appointed a Privy Councillor. His voice is no quieter from the Back Benches than it was from the Dispatch Box in his time there. I have to say to him, however, that what we are seeing from the Commission—there is no point in ducking this—is essentially a move further to centralise the way in which Europe works, at a time when it should be moving in the opposite direction. I am alarmed that the Government say that they are relaxed about this, and I hope that we shall hear more about their real view of what is happening.

The Government like to claim that they are constructively engaged in Europe; I think that they used to refer to that as winning for Britain in Europe. As usual, the claims and the reality are very different. The Lisbon process—to which the Foreign Secretary referred in glowing terms again today and which is good for Britain—is badly behind schedule. In some areas, the Government are positively working against the goals of Lisbon. With the active connivance of Labour's MEPs in Brussels, unnecessary, burdensome and costly European legislation continues to flow in our direction, undermining the Lisbon process. The vibrations directive is a good example of such interference from Brussels. Nor did signing up to the social chapter do Britain's competitiveness any favours.

The Government are hardly winning the battle of ideas in Europe. We were assured by the Minister for Europe's predecessor—the hon. Member for Leicester, East (Mr. Vaz), whom I am pleased to see in his place—that the charter of fundamental rights would not be legally binding. However, it is increasingly being used in European Court of Justice jurisprudence. That flies in the face of undertakings that were given about its nature.

Mr. Vaz

The language that the right hon. Gentleman has adopted today in respect of the convention that was created to reform the European Union is exactly the same as that used by his predecessor, the right hon. Member for Horsham (Mr. Maude), in talking about the European charter of fundamental rights. The charter is not legally binding; all that it is, and will remain, is a set of rights that the citizens of Europe are entitled to expect.

Mr. Ancram

I have not mentioned the convention—I will in due course—and the hon. Gentleman cannot pre-empt what I am going to say about it. I repeat that the European Court of Justice is a European institution, and its jurisprudence now uses the charter of fundamental rights. To describe it as not legally binding is to indulge in semantics. If it is being used by the European Court of Justice as part of its jurisprudence, it is essentially part of the law by which we are being governed.

The Government keenly support the European security and defence policy, but yet again there is a lack of real effectiveness. At Laeken in December, the Belgian Foreign Minister said that the ESDP must declare itself operational without such a declaration being based on any true capability", and that it was being put into action without being able to deliver. What, therefore, is the point of it? That is a further classic example of the gap between European rhetoric and European reality. As we know, this Government are past masters of such matters.

Nowhere is the Government's drift towards further integration clearer than in the common foreign and security policy. Of course, the benefits of foreign policy co-operation are clear where such co-operation is in all member states' interests. However, attempts to enforce co-operation are flawed and ultimately unworkable, as is any attempt to coerce what is naturally incoercible. Instead, we should be seeking to entrench flexibility, the value of which we saw after 11 September. This Government were realistic about what was required to meet that threat. The Prime Minister helped to build an international coalition that allowed nations to contribute at the level at which they felt happiest. Europe was able to react at different levels of enthusiasm and participation. The attempts of the most ardent European integrationists to seek a common policy—which, on that occasion, would have involved sailing at the speed of the slowest ship in the convoy—were rightly resisted. Various countries had different views on the most appropriate response, so in practice a common line or policy was impossible. The farce of the mini-summits—not least the famously gate-crashed Downing street dinner—also showed that, quite understandably, smaller European countries would not stand for having their foreign policy dictated by larger ones.

Likewise, the varying responses to the crisis in the middle east illustrate that European nations' views on what is the proper reaction differ greatly. I am glad that the crisis will be discussed in Seville, and I endorse the Foreign Secretary's comments on the outrage that took place in Israel this morning. We agree with the Government's current position on the middle east, but in recent EU discussions on this issue, only Germany took the same view. We were in a minority, and if a real working common foreign policy with a single voice had been in place, we might now be imposing sanctions on Israel. Would the Foreign Secretary really have been happy to go down that route?

From the outset, the common foreign policy has been marked by a lack of direction. Much play was made of the EU's decision at the beginning of February to impose targeted sanctions on the Mugabe regime in Zimbabwe. The Foreign Secretary famously described it as "clear, unambiguous and unanimous". So what happened? Just last week, the International Crisis Group issued a report on Zimbabwe. Its author says: Britain and the EU talk tough and do nothing. It's a joke. They threatened Mugabe that if he stole the election they would come down hard on him. Mugabe must be laughing at them". What an indictment. Yet again, the contrast between the rhetoric of an effective common foreign policy and the reality could not be clearer. If Europe is being tough on Zimbabwe, why are not the targeted sanctions being made to work? Why can prominent Mugabe aides visit Europe? Why are the families of those on the travel ban permitted to visit Europe? The Foreign Secretary will remember telling the House on 21 March: We have taken the action that it has been necessary to take because of the illegitimacy of the Mugabe regime."—[Official Report, 21 March 2002; Vol. 382, c. 449.] That action clearly has not worked, with Augustine Chihuri in France last month and Mugabe in Italy this month. It is a farce. What steps will the Foreign Secretary take to convince his European colleagues to extend the sanctions regime and to ensure that it begins to bite? Will that be discussed in Seville? If it is not, that would be a disgrace.

Mr. Bill Wiggin (Leominster)

Is my right hon. Friend aware that 8 August is off-the-farm day for all white farmers in Zimbabwe? Does he agree that Seville would be the ideal opportunity to discuss further sanctions?

Mr. Ancram

I agree wholly with my hon. Friend that further sanctions should be discussed, but more must be done. We want effective action from the EU. That is what we were promised in February. It has not happened and a disaster is now unfolding in Zimbabwe. The EU has a role to play and it should start playing it now.

Ms Stuart

I am not clear whether the right hon. Gentleman thinks that we should have a common European foreign policy or not. He seems to be arguing on the one hand that it is not effective enough and on the other that we should not have one.

Mr. Ancram

The hon. Lady should have listened to what I said earlier. I said that there will be times when co-operation on certain matters will be beneficial, and Zimbabwe is an example of that. I want that co-operation to work, because there is no point in the Council of Ministers uttering brave declarations if they achieve nothing. I hope that we will see some effect on this occasion.

In recent weeks, we have seen in the press the chaos that characterises European foreign and security policy. Convention chairman Giscard D'Estaing has called for a common European diplomatic service. That is quite an advance. Romano Prodi wants to push ahead with a single European foreign policy. The Foreign Secretary, in a recent speech, appeared to want to redefine sovereignty better to fit that model. But at the same time we are told that the Government really support the concept of a Europe of nations. Which is it? Whom should we believe? The message is now so unclear and the language so confused that it is no wonder that ordinary people feel cut off from their European masters and are suspicious and mistrustful.

The Europe that we need, and that people in Europe want, is one that is modern and decentralised, that trusts its members and does not constantly try to aggregate more of their powers to itself. We want an EU that is outward looking. We believe that Europe must change in a way that brings it closer to the people who live in it. The idea that seeing Ministers voting on television will achieve that is laughable. That belief in change is now matched by a realisation throughout Europe that the old EU, driven from the top down, will no longer achieve it. Recent referendums and other electoral tests have demonstrated the growing sense of alienation. If Europe is to carry true democratic legitimacy and accountability, it must find a way to reconnect with its peoples. Europe itself has realised the need for that.

For a start, there is now the convention on the future of Europe. I am grateful to my right hon. Friend the Member for Wells (Mr. Heathcoat-Amory) for representing our parliamentary party so effectively on it. [Interruption.] Two Members from opposite sides of the House represented this Parliament. I am thanking my right hon. Friend for the splendid job that he did. I am happy to pay tribute also to the hon. Member for Birmingham, Edgbaston (Ms Stuart).

The Parliamentary Under-Secretary of State for Foreign and Commonwealth Affairs (Mr. Denis MacShane)

For the splendid job she did.

Mr. Ancram

The hon. Lady may well have done a splendid job, although that might by judged by different lights on either side of the House. At least the convention represents a realisation of the need for consultation in building the future European Union. However, that consultation cannot be narrow in scope or agenda. It must address all the fundamental problems facing the EU today—in particular, the glaring democratic deficit. Early experience, even from a distance, suggests that it will not do so. That is why we need a more fundamental reform and review of how the EU currently works. Such a review is necessary before genuine constructive reform can take place. It must be robust and comprehensive. It must be ready to root out that which is not working, and strengthen that which needs to be improved. It must be ready to revisit and re-examine the directives and treaties that make up the acquis if it is to do the job that must be done. There can be no sacred cows, no no-go areas, no sealed vaults. Anything less would be not just a massive missed opportunity, but an abdication of the chance to deal with the real issues in Europe today.

The EU stands at an historic crossroads. Britain would not benefit from standing aside from the process of change; withdrawal from the European Union would not be to our advantage. We would lose jobs and influence. But this Government's determined pursuit of a supranational union with ever more powers and responsibilities assigned to it is not the answer either.

Our view is clear. It is a view of a Europe that is constructive, responsive, positive and forward-looking; a Europe that seeks to work in partnership with the United States rather than in rivalry with it; a Europe that abandons its current anti-American rhetoric and its unreal aspirations to be a superpower itself.

Europe needs to change to bring itself back in touch with the peoples and Parliaments of the nations of Europe. They are the original and abiding source of its legitimacy Reform should aim to put them back at the heart of the European Union. Yet even today Romano Prodi has signalled his determination to take more control from EU Governments, and to give the Commission more powers. That is the very opposite of what is needed to deal with the democratic deficit that lies at the heart of Europe's problems today.

We need a partnership of sovereign nations, bound by the single market and the rules of free trade—a partnership that deals at European level with issues best dealt with at that level, such as pollution, but in other respects works at different levels of participation and involvement, tailoring common ventures and aspirations to the national interest and doing things in the way that is best for each nation. We need a Europe that recognises and maximises national strengths constructively.

"Top-down" Europe has failed. We must return to the concept of a "bottom-up" Europe, a Europe that starts and finishes with the needs and aspirations of the people of Europe rather than the ambitions of its bureaucrats. That is the challenge of Europe today. That is the challenge that we are ready to take up. That is the challenge that even France's new Prime Minister, Mr. Raffarin, seems ready to adopt in relation to France.

Our Government are so obsessed with their place and status in the Councils of Europe that they have turned their back on that challenge. We urge them to think again before it is too late.

5.2 pm

Mr. Peter Mandelson (Hartlepool)

One area of policy in which we are patently not all Thatcherites now—along with almost every other—is Europe. Today's debate gives us a chance to take stock of the topical challenges that face the European Union.

In terms of the EU's current achievements, I think the smooth and efficient introduction of notes and coins in Europe's single currency suggests that that arm of European integration is on track for success—which is not to say that I think Britain should rush in and join other eurozone countries; I happen to think that Britain's caution, and the Government's caution, is right. I think that the Chancellor of the Exchequer's tests are the right tests to apply to any decision by this country, and I strongly believe that, whenever it takes place, the economic assessment of those tests must be absolutely objective. I for one would not want any other political consideration to intervene and to influence the undertaking of the assessment that will take place some time in the next year.

Mr. Ian Davidson (Glasgow, Pollok)

Does my right hon. Friend believe that joining the euro is an essential condition of Britain's being a leader in Europe, and that the question for the Government is when, not if? If he does not agree that that is the question facing the Government, why does he have it on his website?

Mr. Mandelson

That happens to be the view of the Government. I supported that policy when I was a member of the Government, and I still support it. In principle, the Government are committed to joining the single currency. That is a matter of when and not if. The timing will be determined by economic tests and considerations, not political ones

On the subject of the economic considerations, I cannot resist commenting on what has been happening in the foreign exchange markets in recent weeks. The euro has strengthened somewhat against sterling, which is welcome to British manufacturers, but the financial press has contained much comment that the mighty dollar is set for a steady fall against the euro. If that trend continues, one of the most awkward economic obstacles to Britain joining the euro would be on course to be overcome. The significant point is that, if we were to choose finally to lock sterling into the euro, we would no longer be at risk of doing so at too high a rate. The danger is that, if the rate were too high, and if the euro were then to appreciate sharply against the dollar, that would render us uncompetitive in the US just at the time when we faced a tough task in holding our own in European markets.

Mr. Hopkins

Does my right hon. Friend not agree that the supposed strengthening of the euro is merely another facet of the weakening of the dollar? Are not both the American and eurozone economies in difficulties, with the result that the British economy looks rather strong?

Mr. Mandelson

I do not deny for a moment that the performance and underlying condition of the British economy are very strong. That could strengthen the argument that we should join the eurozone and not stay out of it. However, two things may be happening: the value of the dollar may be reflecting the underlying strength of the US economy, but the market's judgment about the underlying strength and performance of the eurozone economy may be catching up with its evaluation of the euro. Both factors are significant, but the Government's economic assessment must take account of a number of others, and I do not presume to anticipate the outcome of that assessment, or when it will happen.

The value of the single market—and a single currency, which is the sensible and logical extension of the single market—together with the consolidation of peace and individual freedom in a united Europe is the reason why I believe that we should remain on course to admit 10 additional members to the EU in 2004. My right hon. Friend the Foreign Secretary has said that negotiations should be finalised in Copenhagen in December, and I am encouraged to hear of his commitment to achieving that.

In the context of those negotiations, Britain is right to press now for a political commitment to reform the common agricultural policy at a future date. If the EU is to make a success of enlargement, deal with the many very serious strategic challenges that it faces and ensure that resources are used properly and for the real benefit of its citizens, reform of the CAP is long overdue. That tough decision must be faced sooner rather than later. However, I am not suggesting that reform can feasibly precede enlargement, nor be a binding condition of whether enlargement goes ahead.

The other week I was speaking in Poland, arguing for a strong commitment to a constructive social dimension in the European Union. It was clear in my discussions with Polish leaders and Government members that this is a decisive moment in Europe's history, not just for Poland but for all candidate countries. If we miss this chance to reunite Europe, it may not come again. I suspect that opposition to membership would be bound to grow in all the candidate countries that we would so badly let down were we to funk this challenge.

Much could be said about the many issues facing the European Union, but I should like to touch on just three—the work of the convention on the future of Europe and the need to strengthen the political legitimacy of the EU; the difficulties created by mass migration, how we deal with asylum and the need to police the EU's border; and Europe's attitude to the rest of the world, particularly its relationship with the United States, which I do not think is being handled in an entirely constructive and happy way.

First, I very much admire the way in which the convention is going about its job. Recently I have had the opportunity, on two occasions, of hearing lengthy presentations from members of the convention, including one of its vice-presidents, Giulliano Amato, the former Prime Minister of Italy. I believe that the convention is asking the right questions and seems to be establishing the right parameters in strengthening the role of national Parliaments and Governments in securing greater transparency and accountability in the EU's operation, without damaging the Commission's essential stewardship of the EU and its ability to work in the interests of all. The Commission has an indispensable role to play and I do not need to rehearse the arguments for that. Strengthening the hand of national Governments and Parliaments should not and need not be done at the expense of the indispensable role that the Commission plays.

There are two key points of which the convention should not lose sight in developing its plans. First, we will not achieve the popular consent that is required for Europe to contemplate further integration if we do not devise new mechanisms against unnecessary centralisation in the European Union. Many people talk a great game when it comes to subsidiarity and make a huge rhetorical commitment to it without demonstrating equal commitment to the machinery that is needed to make it a reality. Subsidiarity and a new political mechanism to enforce it, is not a technical issue. It goes to the heart of Europe's political problems. I am not arguing against centralisation in certain respects where it is appropriate and properly agreed. Indeed, healthier and stronger subsidiarity would do a great deal to legitimise that centralisation which everyone has agreed should go ahead.

Secondly, I strongly agree with my right hon. Friend the Foreign Secretary that we must find ways to ensure that decision making in Brussels is not only more visible but more political. That is the essence of the case for abolishing the obscurity of the six-month rotating presidency and for having an elected president of the European Council for a significant period. It is not to find a resting home for some, no doubt distinguished, elder statesman—[HON. MEMBERS: "Name him!"]—who may or may not be emerging from first-rate public service in his own country, from whatever part of the continent and at whatever time in the future.

The case is that there should be politicians on the Council who are clearly identifiable and who can take responsibility. People could hear directly from those politicians and would know what they were dealing with, and there would thus be a measure of the politics that are going on in Brussels, instead of the foggy, hazy miasma of bureaucracy that people sometimes have the impression substitutes for effective political working in and around the Commission. That is also the argument for more open voting in the Council of Ministers, even with all the limitations that the Foreign Secretary described, and for rationalising the present bureaucratic paradise of councils, committees and working groups that is as opaque as it is slow moving in bringing the European Union to proper and expeditious decisions and agreements on many and pressing matters.

Behind the reforms is the idea that directly accountable politicians should be in charge of Europe's direction and that they should be seen to be in charge, working in tandem with the motor of the European Commission. As I said, I do not want the Commission to be weakened. It could be strengthened—it could certainly be legitimized—if it were seen to be working in a clearer political framework in the EU.

On migration—the second issue that I want to discuss—the Government are right to insist on the EU facing up to its responsibilities. We cannot solve the problems of asylum, migration and human trafficking simply by relying on our own national border controls. The problems are common for the European Union as a whole and strengthening the EU's common border is an urgent priority. The need will be even more acute when relatively poor countries, such as Poland and others, become EU members in 2004.

Simply lecturing our partners on how they should live up to their responsibilities—as some people on the continent and indeed in this country do—will not work. It is not realistic to say to the Greeks, for example, "You deal with all the boatloads of illegals landing on your islands and solve our problems for us". Our partners—Greece is not the only one—need practical help to tackle human trafficking across their borders. We should be ready to establish the proper working of joint action teams and to use the EU budget to guarantee the security of the EU's common border. The states of the EU, acting together, can be a more effective force in stemming the flow through transit countries, tackling the causes of migration at source and securing an increased number of returns where illegal migrants are shown to have no case for asylum.

This must not become an exercise in feeding people's xenophobia in those countries, and I feel that quite passionately. I believe that addressing those issues—tackling them head on and having a proper debate about them—and formulating balanced and sensible policies is the only way to head off creeping xenophobia in Europe. I do not believe that formulating policies of that kind needs to or should conflict with the liberal and humanitarian values that we rightly uphold, not least because Europe needs some economic migrants to offset an ageing population and, indeed, to supply workers for our public services, for example.

We should be proud, too, as Britons and Europeans, of our tradition of offering a safe refuge from persecution for those genuinely in need of asylum, but I stress that that is an argument for managing our common borders with more efficiency, not for continuing with the present, unacceptable chaos, which is inevitably and rightly causing growing public concern and is a very real political threat not to the left or the right but to our democratic and proper ways of working in Europe, and we have to face up to that.

The third issue that I want to touch on concerns the rest of the world outside Europe. Just to state the obvious, Europe faces considerable threats and considerable opportunities in the rest of the world. The organising principle that governed the international system for many decades following the second world war was, of course, that of the cold war—east versus west, freedom versus communism—and every international problem was seen through that model, through the prism of that conflict. Everyone lined up on either side and the international system was designed to mediate between those two competing blocs and ideologies to find some resolution of international problems and issues—which, more often than not, it did—but the cold war has ended with the collapse of the iron curtain and the Berlin wall, and we need to find a new organising principle around which the international system can revolve.

The organising principle that we now want to create in the post-cold-war era is one of order versus disorder. We will not bring order to any part of the world or to any regional conflict, dealing with any rogue state or integrating any pre-modern or failing state into the international system, nor will we succeed in spreading economic opportunity to the world—redressing and correcting the dark side of globalisation, which is manifested in so many ways and among so many people in different parts of the world—without America and Europe working very closely together.

America and Europe have worked very closely and successfully in sorting out the problems in Europe—we are still doing so in south-eastern Europe, in the Balkans—but Europe and America now have to work just as closely and effectively in helping to sort out problems beyond the European continent.

Mr. Hopkins

I thank my right hon. Friend for giving way again. I agree entirely about the need for a new order and stability in the world. Would he not agree that the post-war world created at Bretton Woods was much more sensible, orderly and stable than the world of global financial markets, which seem inherently unstable and much more difficult to control?

Mr. Mandelson

The world of Bretton Woods was one that we were able to create, operate and manage very well, from which we derived considerable benefits. The world of globalisation is not man-made in that sense, but it will not go away. It is the way in which the world economy is operating, and its rules, what governs it, its demands and the speed at which it brings economic change to all parts of the world—the way in which problems and tremors in financial markets or in certain regions of the world are felt throughout other financial markets and other regions throughout the world—that constitute the world in which we live.

We need to design an international system to manage, cope with and respond to the world in which we live. To state the obvious, we have not succeeded in the post-cold-war world, at least so far, in creating an international system that is capable of standing up to and managing the ferocious challenges that globalisation is creating. I am talking not just about the social and political effects of economic globalisation but about disease, illegal drugs, transnational crime and environmental degradation. Whatever international issue one cares to identify, none will be solved by either America or Europe acting independently of the other. That is the common feature of the challenges with which we are now faced internationally. International terrorism and weapons of mass destruction are the new and additional threats. My fear is that EU member states are simply not appraising those external threats to our security with the realism and urgency in all cases that those threats demand.

I sometimes think that if the events of 11 September had happened in Europe rather than America, we would still be weighing up the evidence about who or which group was responsible and debating the pros and cons of whether to respond. I suspect that, had those events happened on European soil, the anniversary of 11 September would come around this year without us having acted in response. That is due partly to a lack of will and decision-making capacity on these matters in Europe. Also, however, some European nations—the majority, in fact—are not facing up to the need to equip themselves adequately if Europe is to play the full partnership role with the United States that I would like us to undertake.

It is no part of my argument that we are under-prepared or ill-equipped and, therefore, we should leave the responsibility to America. My argument is that Europe has a very important role to play, and, at the moment, it is punching below its weight. It needs to increase its decision-making and technological capability to an extent to punch its true and full weight as a partner—not as an equal partner, of course, but, none the less, as a partner—with the United States. Clearly, there is a huge technology gap between Europe and the United States. I do not suggest for one moment that we can, would or will close that technology gap. That is unrealistic. At the moment, however, most European nations are barely able to move or even talk to each other in terms of their technological capability, let alone engage directly with an enemy whom we must confront.

We are not lap dogs of the United States. We will have our own perspective on certain issues. At the moment, we take a slightly different perspective on the middle east, where we see a more pressing need for diplomatic and political action in that conflict. We do not seek to rival the United States in its power or world role—that is not realistic—but we share fundamental values and interests with it in winning the war against terrorism, in bringing democracy and human rights to nations and regions where people are denied both and in integrating Russia and China into the international community of nations.

My hon. Friend the Member for Luton, North (Mr. Hopkins) touched on the issue of international financial institutions, and we share with the United States the aim of modernising them. We need successor, modernised, relevant international financial institutions to rise to the challenge of the new global problems and the poverty that still blights many parts of the globe. We have successfully to complete the Doha round. Those and other challenges have one thing in common: they are global issues that Europe must address beyond its continent. It must co-operate with the United States in doing that.

I know that the Government are acutely aware of all those international challenges and I strongly commend the approach that my right hon. Friend the Foreign Secretary and his team have taken to them. When it comes to dealing with external threats, we must seek to engage the French and the Germans with particular seriousness. The year 2004 will mark the centenary of the entente cordiale—yet another anniversary—so let us plan to make it a major milestone in British-French defence co-operation while, crucially, encouraging Germany to assume its proper share of the ever-growing burden of Europe's world role. We need to do that if Europe is to punch its full weight.

I agree with my right hon. Friend the Foreign Secretary's remarks that Britain's relations with Europe have been literally transformed over the past five years. We have a position of respect and influence that would have been unimaginable under the previous Government. What do we do with that influence? How do we build it and use it to shape the future direction of the European Union?

In a further response to the question of my hon. Friend the Member for Glasgow, Pollok (Mr. Davidson), I have no doubt that, in the long term, we will need to be inside the single currency—I hope that that will not shock him too much—if we are to maximise the benefits of our position in Europe and strengthen Europe's effectiveness. However, that must be determined by Britain's national economic interest and not by political prejudice—whether the Government's or that of powerful foreign nationals however mighty they may be or appear to be.

Mr. Davidson

Name them.

Mr. Mandelson

No, a thunderbolt would strike the back of my neck and I might end up making a premature—definitely premature for some—return to the Front Bench.

In the meantime, I want to encourage the Government to continue on their present course, maintaining a strong influence for our country in Europe and pressing the case for reform, especially economic reform. The right hon. Member for Devizes (Mr. Ancram) was right to highlight Lisbon. We overlook and shuffle Lisbon, and Cardiff for that matter, to one side at this continent's economic peril. Economic reform needs to take place alongside reform of the EU' s working methods and institutions. We also need to forge that necessary and strong transatlantic relationship with America. The interests of America and Europe do coincide, and I strongly believe that that should govern our approach to our membership of the EU.

5.35 pm

Mr. Michael Moore (Tweeddale, Ettrick and Lauderdale)

First, may I associate the Liberal Democrats with the Foreign Secretary's comments about the tragic events in the middle east? It is yet another dark day for that part of the world. I welcome the fact that the Foreign Secretary and his colleagues will use this weekend in Seville to focus their minds on that problem yet again. May I also apologise on behalf of my right hon. and learned Friend the Member for North-East Fife (Mr. Campbell), who is unable to be here this afternoon? He sent a note to the Foreign Secretary and the shadow Foreign Secretary in anticipation of his absence and hopes to attend to hear the concluding speeches.

This important debate has been good humoured and good natured and many of the big issues have been brought into the open. The right hon. Member for Hartlepool (Mr. Mandelson) said that this is a decisive moment for the enlargement process. I agree. I would also characterise it as a time when there is an uneasy atmosphere in Europe. Electorates have been uncertain in key parts of the Union in the past few weeks and some of the big decisions have to be taken when there is not a great deal of room for manoeuvre before enlargement in 2004. The different factors are coming together to create quite a bit of pressure on those who will meet in Seville later this week.

The issues before the representatives are fairly obvious. We are two years from enlargement and massive changes are in prospect as a consequence. Reform of the EU and its institutions was already necessary, and enlargement makes that more critical. Specific policies have been mentioned. Immigration and asylum policies are at the forefront of the minds of many Governments. We would not dispute that the issue is of legitimate concern. However, we are worried that an element of realpolitik has promoted the issue so far up the agenda. It certainly grabs headlines, but it may also be used to obscure other equally pressing matters.

Although that issue may dominate the agenda in Seville, others will probably dare not show their face—the single currency, Gibraltar and Irish ratification of the Nice treaty, for example. The challenge for the summit is to emerge from all the detail in which it will undoubtedly be caught up. It cannot fall into a reactionary trap and ape the right of Europe. It must show leadership.

In recent days and weeks the United Kingdom's position on immigration and asylum has been set out by senior Ministers. The Prime Minister wrote to the Spanish presidency on 16 May urging it to put asylum and immigration at the top of the agenda. The Home Secretary said: If democratic politicians fail to tackle the difficult issues posed by immigration and asylum people will increasingly embrace extremist solutions". The rhetoric is one thing, but the worry must be that in an attempt to outflank some of the less attractive parts of European politics, we might be seen to adopt their policies too.

These issues are undoubtedly very delicate, and we must be careful. Language like "swamping" and fears about the loss of cultural identity do not tackle the core issues. Just as important, surely, is the inability of Governments to co-operate on cross-border matters when they arise. The form of politics based on the lowest common denominator is depressing and rarely effective, but to have national Governments going their own way cannot possibly be the answer. The failure of the authorities in the United Kingdom and France to resolve the issues of Sangatte should be a warning to us all.

Of course, this policy area is ideally suited to joint working, and the Foreign Secretary set out the history of that from the Tampere summit in 1999. We believe that member states should be prepared to co-operate effectively on immigration and asylum in response to mutual and international concerns. Following the Amsterdam treaty, many of those policies have been developed, but we are still rather stuck where we are dealing with common minimum standards rather than eyeing up the common policy, which could still be a good distance away, although this afternoon the Foreign Secretary expressed confidence that more progress will be made.

Two specific policy proposals have been floated recently. I was glad that the Foreign Secretary chose not to dwell on them. One is for European border guards. Surely there is a huge difference between co-operation and support for existing members or applicant states in securing external borders and the concept of having capped Euro-guards at the frontiers. Perhaps that idea is the product of over-imaginative spinning, but even if it could ever be attractive, it is well ahead of its time.

More important, however, is the other proposal doing the rounds, which is that aid to particular countries may be linked to their acceptance of the return of failed asylum applicants. It was not clear to me from what the Foreign Secretary said whether this is his favoured approach. Do those who propose it intend it to apply to all Governments, including those of the failed states, or only those countries involved in trafficking, where the police force may turn a blind eye? The Government need to remember the reality of the countries from which many of those people come.

We must not allow the rhetoric of the right throughout Europe to influence that decision. As the Foreign Secretary said, the evidence is that asylum applications are levelling off, and their number is half what it was 10 years ago—although from the state of the political debate one would not necessarily appreciate that. Most refugees and people in difficulty come nowhere near Europe. Many millions suffer much more hardship and poverty thousands of miles from the European Union. Cutting off aid to some of those countries as a punishment for their refusal to comply with European standards on asylum seeking and migration would certainly be rough justice, and we seek clarification from the Minister who will wind up the debate about precisely what position the Government will be taking on the issue in Seville and elsewhere.

Asylum and immigration are closely linked to enlargement, another big theme that will, of course, be extensively discussed at the Seville summit. All European mainstream parties support enlargement, but there are undercurrents of concern about the movement of people from central Europe into other countries. Because the political climate in Europe has changed in recent months, we need to be careful that excuses are not found to raise the barrier to entry as the negotiations approach their conclusion. Similar fears were expressed when Spain and Portugal joined the European Union, but the migration did not materialise, although that may not stop some arguing the case.

Enlargement debates will rightly focus attention on many other issues. Enlargement has been a long-held goal of UK foreign policy under both Conservative and Labour Governments and has enjoyed cross-party support. Significant progress has been made in recent months, as we approach the deadline of completing the negotiations by the Copenhagen summit—nine years after the last gathering in that city, which set out the criteria by which applicant countries would be judged. The Spanish presidency has made significant progress, and reports suggest that 80 per cent. of the acquis is now resolved. That is no mean achievement, but we still cannot take the outcome for granted. Questions have been raised in existing member states and, possibly more worryingly, in applicant countries as well.

Perhaps we are in danger of taking for granted some of the fundamental reasons why we all believe in the European Union. The benefits of strengthening security, entrenching democracy and underpinning prosperity have been the key principles for nearly 50 years. When we worry about the minutiae of agriculture, we may be in danger of forgetting those key principles, even though agriculture as an issue runs the biggest risk of being the block to the successful completion of the negotiations.

Although 80 per cent. of the negotiations may have been completed, we in Europe have developed a tendency to postpone a difficult decision. The finances of the common agricultural policy and how they will apply after enlargement will not be tackled until after the German elections. Likewise, the proposed mid-term review of the CAP as a whole is not to be undertaken until later in the year. That may be understandable and pragmatic, but given that the CAP is the biggest financial issue facing the conclusion of the negotiations, leaving just weeks before the self-imposed deadline makes it tight, to say the least. None the less, it is extremely important that CAP reform is developed and success achieved. When the Minister winds up, it would be helpful if he would say why he is confident that the reform of the CAP and of CAP finances will be resolved.

I mentioned the need for Irish ratification. Since we last debated these matters in the Chamber, there has been an Irish election and Mr. Ahern has been comfortably returned to government—more comfortably than was his position beforehand. We must not lose sight of the fact that when the referendum on the Nice treaty was conducted in Ireland last time round, all the political parties, whether in government or in opposition, supported the proposition, so a stronger Prime Minister may not necessarily strengthen the case.

The worry now must be whether there is a plan B or some stunt that will be pulled out of the hat if the worst comes to the worst and the Irish reject ratification a second time. All the rhetoric suggests that that will not happen. Perhaps that is a way of impressing on the Irish electorate the obligation to ratify the treaty on this second occasion. However, when European electorates have been told recently what they should be thinking or doing, they have had a nasty habit of doing something quite different. The Government must face up to that. If we can get some insight into what will happen if the treaty is not ratified, that will help us all to understand the process much more clearly.

The future of Europe is the tag line for the convention that has been set up to contemplate many of the structural changes that are necessary to take account of the changing face of Europe not only because of enlargement, but largely as a consequence of the difference between a European Union of 15 states and one of 25 states in about two years' time. The Laeken summit set up the convention. Assuming that they catch your eye, Madam Deputy Speaker, I look forward to hearing from the hon. Member for Birmingham, Edgbaston (Ms Stuart) and the right hon. Member for Wells (Mr. Heathcoat-Amory), who have been representing this place at the convention alongside Lord Maclennan and Lord Tomlinson from another place.

Europe needs reform. With enlargement coming along, there is no prospect of sustainable development of the EU unless we have that reform. Some different ideas have been bandied about this afternoon. The Liberal Democrats would welcome an enhanced role for the national and European Parliaments in the reformed Europe, not least in terms of greater scrutiny. I listened carefully to what was said about the Foreign Secretary's bold initiative on televising voting at summits of the Council of Ministers. If the only aspect of this place that could be seen on television was the voting—not that many people watch this place on television anyway—our chances of enlivening democracy and people's interest would be rather limited. Surely, that cannot be a serious answer to the underlying problem.

As a constituency Member of Parliament, I know how difficult it is to seek to influence any debate in the Council of Ministers. This place struggles to have any scrutiny role with regard to Ministers from particular delegations, unless it is through the tabling of parliamentary questions asking the Government to set out their version of events and of what was discussed and agreed. That is a partial process, however, and it is not particularly helpful.

Ms Stuart

I accept the hon. Gentleman's comment that televising the Council of Ministers is only one step. Does he accept that the fact that national Parliaments will know how their Ministers vote, so that, if they do not vote in the anticipated way, they can hold them to account, is a significant step forward?

Mr. Moore

I accept that. In being slightly scornful of the proposal, I do not wish to rubbish it completely. However, the fact that it is being heralded as a great move forward highlights the rather pathetic state of the development of accountability and transparency in the EU.

We are also hearing ideas about team presidencies, on which we are rather short of detail. The Minister has a burgeoning in-tray, but I am sure that he will be hoping to flesh out that proposal as well. Currently, it conjures up only inelegant images of three-legged baton racers, none of whom is quite sure who is in charge at any given moment.

The review of European policy is clearly important for us all at this time. The debate at the convention will be important and I know that many in this House and in another place are trying to follow its proceedings as closely as possible. As a party, the Liberal Democrats are in the process of reviewing our policies in this area, and the Conservatives have even launched a website about the future of Europe. What, then, of the Government? We have seen no White Paper about this major development in Europe; indeed, not even a Green Paper is in prospect. After Laeken, the Government were supposedly committed to launching a great debate about the future of Europe. I suppose we must ask ourselves whether this is it, because there has been very little other evidence of it in the wider country.

Many Euro-barometer polls are used to track attitudes to Europe and many of the related issues. Such a poll has recently exposed the United Kingdom as the least knowledgeable country about the EU and its institutions. Almost a third of United Kingdom respondents said that they knew nothing or almost nothing about EU policies and institutions, and 73 per cent. said that they had received no information about the single currency.

In a message on the Commission website that has been set up specifically to inform the people of Europe about the debate on the future of the EU, the Prime Minister writes: we need to ensure that European Citizens feel real ownership of the EU's activities". He goes on to state: the people who really matter in this great debate are not the politicians or the institutions or the academics, but the people of Europe themselves. Hear, hear to that, but how can people participate in the debate if the Government are not prepared to discuss the issues throughout the country?

Before this debate, I took the opportunity to review the Foreign and Commonwealth Office website to see what it was doing to promote discussion about Europe more widely in the country. One very helpful section states: The government has set out its approach to the Future of Europe debate in various keynote speeches". Particular reference is made to a speech made by the Foreign Secretary on 21 February in The Hague, but a quick examination reveals this opening comment: My aim today is not to provide a blueprint for the future of Europe, but rather to ask some fundamental questions". By any standard, that is not a great start. The Minister for Europe has characterised himself as being in listening mode, and we welcome that, as such an attitude is positive in any Government, but surely calling for the debate is not the same as having it, and now is the chance for the Government to take the lead.

The Laeken declaration set out 54 questions under four headings. It mentioned better division of competences between the institutions. Governments and Parliaments of Europe, simplification of instruments, better democracy and transparency and even the evolution of a European constitution. All those aims are worth while, from simplifying the treaties to opening up the Council of Ministers to some form of public scrutiny. The Government were party to the process that set the questions at Laeken, and in any walk of life, helping to set the questions is usually quite handy when one comes to provide the answers. When can we expect the Government's detailed response? Right now, it is not entirely clear where they think they are taking this country. Surely, the onus is on them to lead that debate.

Mr. Walter

I have been listening very closely to the hon. Gentleman. He has been asking what the Government's policy is, but I was rather hoping that we might hear about the Liberal Democrats' policy on the future of Europe.

Mr. Moore

I am sorry, but I do not think that the hon. Gentleman has been paying quite as much attention as he claims. We are in favour of a great deal of the reform agenda that is currently being discussed, and we think that there is a useful and lively debate to be had about that, but we are also in the process of reviewing our policies. I look forward to having a full debate with the hon. Gentleman in due course. Indeed, I respect the fact that, although his party has developed an interesting quietness about this subject in recent months, it claims at least to be willing to enter into the debate.

Perhaps the issue of the single currency is the reason why there is no wider debate, as it appears that the Government are still rather scared of a full-scale debate on the euro—and that is not the case only because the hon. Member for Glasgow, Pollok (Mr. Davidson) will be on the opposite side of the argument. As the right hon. Member for Hartlepool (Mr. Mandelson) restated earlier, the point is that, as Government policy is to enter the single currency, it is all about timing. Yet, every attempt to find out who is doing what, what tests have been met, when we might get a debate and when we might consider enabling legislation leads us into the sand and a reference back to October 1997. That shows very impressive discipline, but it is not very helpful in winning the debate as a whole.

The single European currency has been launched since we last debated European matters on the Floor of the House. As most of us who support the concept predicted, the world has not ended and the sky has not fallen in. Perhaps that will give the Government confidence that they can now take a lead. Modesty in a politician is rare and modesty of ambition in a political party even more so. The former may be an attractive quality but the latter is certainly not. The Government have a real opportunity to take a lead on many aspects of the European debate, but Liberal Democrat Members would argue that so far they are failing to take it.

6 pm

Ms Gisela Stuart (Birmingham, Edgbaston)

As we have heard, this weekend European Heads of Government will meet in Seville. When they met at Laeken last year, they agreed to the setting up of the convention on the future of Europe. That convention is composed of representatives of national Parliaments from the current 15 members of the EU as well as a further 13 applicant countries, including Turkey. Almost half the convention is therefore composed of people who do not have direct experience of the workings of the EU. Government representatives, Commissioners and members of the European Parliament serve on the convention.

I am privileged to serve on the convention as one of two representatives from the Houses of Parliament. May I reassure the shadow Foreign Secretary that we regard ourselves first and foremost as representatives of both Chambers of the Houses of Parliament? I am also a member of the procedural committee which guides the proceedings of the convention. Our terms of reference are broad, and recommendations are to be made to the intergovernmental conference in 2004. At the end of the second world war, my parents' generation could not have imagined the peaceful progress that has since taken place and the general lack of enmity between the nations and people of this continent. Football matches between Germany and England are serious, but not that serious.

We have lost our way a bit, however. Europe has to take a new direction and needs a new mandate. In considering what it is for, and who does what and why, we could learn from the formation and success of the European Coal and Steel Community. National Governments agreed on the clear objective of bringing together European coal and steel industries. An institution with supranational higher authority was set up with clear responsibilities and accountability for meeting that objective. The institutions of today's EU can be traced back to the ECSC, but too often the supranational institutions of the EU have accrued functions and taken initiatives with no authority but their own inclination to expand. That helped to drain much of the enthusiasm for the EU.

That must be put right. Identifying what we are trying to do is a key priority. We must decide what the appropriate institutions are, whether supranational or national, to achieve that priority, and give them the power to carry out that function but no more, then hold them accountable in an appropriate way. We do not have to start afresh, but must clarify areas where individually and collectively the countries of Europe truly benefit from co-operation and collective agreement. Those objectives are genuine, but they are not all-embracing. In too many areas, Europe has encroached on activities which should be left to the control of individual countries.

The convention is necessary because the world has changed fundamentally from the days when the most important objective appeared to be preventing Germany and France from fighting one another. The cold war, which gave western Europe a clear identity and purpose, is over. Germany is united. So what is the EU for? For many, the answer is no longer about ensuring peace but about providing a European answer to globalisation.

The EU is growing. Having started as six member states, it has grown to 15 and will soon have as many as 25, if not 27 or even 28 states. Changes need to be made simply because some decision-making processes will not work with such a large number of participants. Other changes are necessary because the dynamics of relationships have changed. It is salutary to realise that, after the next wave of planned enlargement, member states will include six large countries and one medium-sized one, accounting for 85 per cent. of the population of the EU and almost 90 per cent. of its gross national product.

What do the institutions do and why? In recent years, some EU institutions have lost their determination to act in the interest and on behalf of the union, and have taken sectoral and national interests into account in a manner which has not been constructive. Confidence has been lost in the Commission, the guardian of the treaties. Rather than focusing on their areas of responsibility and enforcing them, the institutions have sought wider powers. Even now, only 60 per cent, of internal market requirements have been implemented. The European Parliament has started to vote in overtly national blocs. The Council of Ministers has not used qualified majority voting to increase its decision-making powers, but QMV has often been used to build blocking minorities.

Do European citizens know how to make decision makers accountable? A number of them have lost faith in many of the institutions and the way in which they relate to one another. When those citizens go to the ballot box in European elections, they do not feel that they are electing a body that they can hold to account, as they do in national elections. Yet the European Parliament has become immensely important in decision making.

Given that assessment of the challenges that we face, what should the convention achieve, and how? We expect to report in spring or summer next year. For many, the real question is where the government of Europe lies. Some believe that we should aim for a Commission elected by the European Parliament. Others argue strongly that political control must reside with the Council of Ministers. We need to address practical questions, such as whether the six-monthly rotating presidency is sustainable. Some countries have argued that the Council of Ministers must become much more strategic, making decisions based on a longer-term view than the six-monthly rotation, and that there are far too many sectoral councils.

Those questions are extremely valid and important, but there is a danger that we may make a big mistake in focusing on institutions rather than their functions. Before we even begin to look at who should do what, we must ask what should be done. The convention has set up several working groups to look at some issues in greater detail. I chair a group which was asked to look at the way in which the role of national Parliaments is exercised in the current EU architecture; which national arrangements function best; and whether there is a need to consider new mechanisms or procedures at national or European level. The group will meet for the first time next week, and we hope to report in October or early November. I do not want to pre-empt its conclusions, but I shall draw the attention of the House to one area that we will consider in detail—the scrutiny of European legislation.

The House of Commons, compared with the Parliaments of many other European countries, has a proud record of scrutinising EU legislation and proposals. I recommend that Members read the 20th report by the Select Committee on European Scrutiny for the Session 2001ߝ02; it addresses many of the issues to be tackled by the convention working group. I assure Members that we shall take its observations into account.

Angus Robertson

As the only member of the European Scrutiny Committee in the Chamber, may I ask whether the hon. Lady agrees with me and other Committee members that the House's position would be greatly enhanced if the scrutiny reserve was not breached by the UK Government so often? The UK Government should not enter into so-called provisional or political agreements, thus circumventing the scrutiny role that the Committee is supposed to have.

Ms Stuart

I am not a member of the European Scrutiny Committee; I am a member of the Select Committee on Foreign Affairs. I do not necessarily agree with the hon. Gentleman's basic assertion. However, time scales for decisions are sometimes so short that the European Scrutiny Committee does not have enough time, which again raises the need for the Council of Ministers to work in a far more strategic way. At the moment, six-monthly breaks mean that there is a sudden hurry at the end and things are rushed through, which is not helpful. I would not blame any single institution, but the co-ordination between them must be improved tremendously to allow proper scrutiny at various levels. However, I shall deal later with more far-reaching problems to do with scrutiny.

Mr. Walter

I note what the hon. Lady says about comparing our scrutiny procedures with those of other national Parliaments. Earlier in the debate, we talked about transparency. Does she think that the European Scrutiny Committee would be a more transparent body if it conducted its affairs in public rather than in private?

Ms Stuart

The European Scrutiny Committee conducts many of its proceedings in public and issues reports. It is almost a reflection of the number of Members in the House that although we have all these Committees, there is insufficient engagement properly to scrutinise. A small number of Members do tremendous and significant work, and the House of Lords does good work too, but the system is not broad enough to allow many to take part in it.

My real argument concerns not so much procedure as the fact that scrutiny often occurs after the event. To put it at its bluntest, national Parliaments rank pretty low in the food chain of political decision making. One official recently told me that the system is an excellent burglar alarm—it tells one that one has been robbed, but there is nothing one can do about it. National Parliaments should be involved at a much earlier stage. One of the problems that we face is that on the European level we are fairly unusual in recognising Parliament as an institution in its own right which needs to be defended as such. In some ways that is our strength, but our weakness is that the House, unlike the political parties and the Government, has no way of arriving at an opinion. The European Parliament has methods of doing that, but we do not.

Mr. Hopkins

I am most interested in my hon. Friend's thoughtful speech. Will she comment on the Commission's recent suggestion that it would wish to see national Parliaments' Budgets to vet them before they are seen by the Parliaments themselves?

Ms Stuart

I promise my hon. Friend that I shall deal with that when I come to my point about the Commission.

When the working group on national Parliaments was first set up, several voices in the convention said that it was a pretty pointless exercise—why should we discuss the role of national Parliaments in the EU architecture, as national Parliaments are represented by their Governments? That demonstrated a fundamental misunderstanding. Although the two things are sometimes the same, Parliaments have a voice to be heard. Laeken made a tremendous break with tradition, in that the convention represents the first time national parliamentarians have been drawn into a process of drawing up proposals for treaty changes. There has been consensus, and the working group made a significant contribution to that.

Some people expressed concern that establishing a working group on national Parliaments would set us up in competition with the European Parliament. I do not want this to be a competition—it should be a constructive relationship that allows national Parliaments to fill some of the gaps in the powers of the European Parliament. One of my Italian colleagues in the convention put it succinctly when he said: MEPs have power without a face, and National Parliaments have a face without power. He was acknowledging that many people relate more to national parliamentarians, who do not have a voice in European-level decision making. I want the European Parliament and national Parliaments to learn to work together, not against each other.

In this House, changes will be required if we are to reach a point where we can arrive at a view. The House authorities have made changes, and I thank my right hon. Friend the Leader of the House for amending Standing Orders so as to allow for convention representatives to be questioned in public hearings by Members of both Houses. That is a tremendous innovation that will assist the debate. It also goes some way to addressing the concerns raised by the hon. Member for Tweeddale, Ettrick and Lauderdale (Mr. Moore), who asked where the debate is going on. In this House, the debate is already quite extensive. Convention representatives have given evidence to Select Committees, and we are going to Northern Ireland on Thursday to talk to Assembly Members. There is debate, but it does not always the hit the newspaper headlines.

Mr. Moore

I take the hon. Lady's point. It reinforces her earlier comments about the difficulty of achieving consensus in this place. My point was that the debate in the country as a whole needs to be kick-started, and that is where the Government have a key responsibility.

Ms Stuart

It is always easy to say, "What are the Government going to do about it?" When I went to a church service in Aachen for the Charlemagne prize, which took place on one of the Catholic high feast days, I was struck by the fact that the main speech was devoted to wishing the members of the convention on the future of Europe well. That showed the extraordinary difference between public perception and the debate that goes on in mainland Europe and the extent to which the media, for example, are interested in the convention's work. I regularly get phone calls asking me what I think about Giscard d'Estaing's hotel bills, but no one wants to know anything about the details of our work. That is one example of an area in which the Government can try to do something, and not be able to do it.

I want to turn to two specific proposals that I hope the working groups will consider. First, rather than focusing solely on legislation that has already been decided on, national parliamentarians should be involved at a much earlier stage. I see no reason why it should not be possible for the Commission to come to national Parliaments to outline its proposals. That would give an early indication of the kind of legislation that is being planned and allow national Parliaments to respond at the formative stages. I want to stress that the Commission should come to us: we should not have to go to Brussels.

Angus Robertson

The hon. Lady will be aware that about 80 per cent. of the remit of the European Union involves shared competencies with devolved institutions, notably that of Scotland, which has legislative rights. Is she in favour of the Commission undertaking pre-legislative consultation with parliamentarians in Edinburgh, as well as those in the UK parliament?

Ms Stuart

That is one of the interesting questions that will be addressed not only by the working group on national Parliaments, but by the working group on subsidiarity. We must be clear about how we deal with bodies that have legislative power. I look forward to Members of the devolved Administrations contributing to that process. However, the main point is that the Commission should come to Parliaments to close the circle, because at the moment it is a line that goes straight down. I am delighted that the European Scrutiny Committee intends to make scrutiny of the Commission's annual work programme an important part of its own programme.

My second point comes back to the comments of my hon. Friend the Member for Luton, North (Mr. Hopkins) about the Commission's scrutiny of budgets. The process should be two-way, not one-way, traffic. I would find it difficult to be persuaded of the merits of my hon. Friend's case, but I am prepared to listen.

If we accept that the problem is one of a lack of clear delineation of responsibilities within the EU architecture, the question of who should police subsidiarity becomes increasingly important. Subsidiarity should be determined neither by the courts alone nor by politicians alone. There will always be issues where reference to the courts is right and proper, but in respect of many, if not most, subsidiarity is a political question, and national Parliaments should play a much more significant role in making decisions. I do not propose for one moment that we should give individual Parliaments the power of veto. However, if several Parliaments conclude that a certain EU-level proposal breaches subsidiarity, it should be taken to the Council of Ministers for a clear and open decision on whether it should be determined at national or European level.

Those are just two aspects of the working group's deliberations. All background papers for the groups are available on the convention website, and any Member who would like details can obtain them from the regular reports to the House that are issued by the two representatives of the House and are available in the Vote Office. I should be grateful for any comments from colleagues, which I will feed into the groups.

We face the paradox that all institutions in the EU architecture need to be strengthened. They need to be clear about their functions and to focus on implementing their mandate. Strengthening one institution is not enough. It would be possible to reorganise the functions of the Council of Ministers, yet continue to do too much at EU level. We can learn from history. We should consider the reason for the success of the Coal and Steel Community: it had a clear mandate, which it pursued.

The convention will be successful if our proposals allow citizens to obtain an answer to the following questions. Who does what in the EU? To whom are those who make the decisions democratically accountable? I would also argue that we must sometimes ask how we can get rid of those who made the decisions.

Roger Casale

I am sorry that I missed the earlier part of my hon. Friend's speech, but I am delighted that she is speaking in the debate, that she is the chair of the working group on national Parliaments and that she is championing their cause in the convention. I welcome her remarks about national Parliaments and I am pleased that she has received a paper from me about their role. I look forward to her comments on it.

Before my hon. Friend moves on, let me take her back to her point about the scrutiny of European legislation here. The European Scrutiny Committee has published its report, to which she may have referred. Does she agree that we need an additional mechanism apart from the Select Committee system and Standing Committees for EU scrutiny? The European Scrutiny Committee's report proposes a European Grand Committee, which would perhaps meet in Westminster Hall and debate matters such as the Commission's work programme and the EU budget. Another important—

Mr. Deputy Speaker

Order. The hon. Gentleman must realise by now the difference between an intervention and a speech. That was far too long. He is taking time that he may need later.

Ms Stuart

Thank you for that protection, Mr. Deputy Speaker. I read my hon. Friend's paper on the role of national Parliaments with great interest. We agree on many ideas. However, I should be reluctant to propose the establishment of yet another institution. We need to consider existing institutions much more closely and I am tempted to suggest that we should have fewer, more strategic and co-ordinated bodies. The key to achieving that is making the Council of Ministers move away from changing its priorities every six months towards taking a longer-term, more strategic view. That will have consequences for its organisation, but I believe that it may be crucial.

The first 50 years of the European Union have been a tremendous success, which we have consequently forgotten to express. We simply focus on its failures. The convention must try to ensure that we leave our children a structure that allows the success to continue. The current honest debates highlight various shortcomings. That should not be interpreted as showing that the EU is not a success. However, the shortcomings exist and we have a huge responsibility to make the EU continue for our children and serve them as well as it has served us.

6.23 pm

Mr. David Heathcoat-Amory (Wells)

I am pleased to follow the hon. Member for Birmingham, Edgbaston (Ms Stuart), my co-member on the convention on the future of Europe. We have eaten several lunches for our country as we jointly tour the embassies and working groups here and abroad, trying to generate interest in the convention and pick up ideas so that we can better discharge our function. The difference between us is probably one of emphasis, because I agree with many of the hon. Lady's comments about the enormous task that faces the convention. My diagnosis is perhaps more radical. I believe that the European Union faces a democratic crisis—and I shall try to justify that phrase.

The European Union is essentially technocratic. It was built up over more than 40 years on a French model, which is statist and centralised. When challenged, it justifies itself by reference to the past, especially the second world war. However, that ended nearly 60 years ago, and the European Union is now curiously old-fashioned in many ways. It retains a bloc mentality and is not fitted for the reality of modern markets, or, more importantly, the principle of self-government. It operates on a top-down principle.

The Commission retains a monopoly on initiation. That is slightly paradoxical, because it opposes other people's monopolies and tries to prevent others' monopolistic activity, but jealously guards its monopoly on initiating legislation. Three weeks ago, it published a paper for the convention in which it advanced the case for radically new policy powers on foreign affairs, security—including defence—and the economy, including budgets and taxation. Today's press states that the Commission wants to reform itself—apparently without treaty sanction—into an internal cabinet. It therefore views itself as a Government in waiting, not as a secretariat or administrative body that carries out the instructions of member states or national Parliaments.

Further down the chain, the legislation is decided in Europe by an opaque and often secretive bargaining process between the Council of Ministers and the European Parliament. National Parliaments have no genuine input into that process. We have scrutiny rights, and Committees struggle heroically with the torrent of legislation, directives and regulations from the European Union. By and large, we simply have to accept what Brussels produces and implement it in law.

I agree with the hon. Member for Birmingham, Edgbaston that we are at the end of the EU food chain. We are the plankton of the European system. That is unsatisfactory, and I hope that the forthcoming report from the European Scrutiny Committee deals with that and tries to put Parliament back in the driving seat earlier in the process. Nobody, including Ministers, currently has any idea about what is happening.

Let us consider the example of the fridges directive, which attempts to deal with harmful gases from old fridges. The Minister for the Environment got into a dispute with the Commission and said that it had let him down badly, and did not keep him informed. Consequently, we have a fridge mountain. I wrote to the right hon. Gentleman on 28 March to sort the matter out, or at least obtain some clarity about the position. I still await his reply. The Minister for the Environment has hundreds of civil servants to advise him, but if he does not know what is happening, what are the public to make of it all? What do the small traders, the officials in local government and the people whom we represent make of the blizzard of obscure and technical regulations?

We should have debated such matters here so that we could examine the costs, the necessary trade-offs, the feasibility and the obligations for the public, business and local authorities. We should have done that before the European process started.

The Foreign Secretary, in opening this debate, said that the problem could be solved at least in part by more transparency, and by having television cameras in the meetings of the Council of Ministers. That is essentially a gimmick. In fact, the alert and informed viewer might want to know what the Council was doing, right at the start of its proceedings, when it passed all the A-points without debate or comment. Those are the points that have been decided not by the Council but by COREPER, the Committee of Permanent Representatives, without any input from Ministers or from this House.

If we went further down into the belly of the whale, the viewer might also want to know about the working committees of the European system. These are the advisory committees, implementing committees and managing committees that take many decisions; by some estimates, they take the majority of decisions. At risk of spraining my wrist, I have examined the latest volume—volume 45—of the budget this year, which lists these working committees. There are 496 of them, they produce no agenda or minutes, and they sit in secret. This is the reality of Europe, and the problem will not be solved by having some President at the top who is elected for a certain number of years.

Angus Robertson

In a similar vein to the comments of Labour Members about engagement with the democratically elected Parliament and Government of Scotland, which deals with the overwhelming majority of issues relating to shared sovereignty with the European Union that affect Scotland, I would like to point out that only 2 per cent.of working groups have been attended by Scottish Executive officials, although the vast majority of issues are devolved. Does the right hon. Gentleman think that that is too much, too little or about right?

Mr. Heathcoat-Amory

I have offered, as has the hon. Member for Birmingham, Edgbaston, to visit Edinburgh and Cardiff to hear more about how we can repatriate some of this decision making back to the United Kingdom—and, possibly, under a form of devolution, back to the other parts of our kingdom. Indeed, we are going to Northern Ireland later this week, and I hope that we shall be able to give the hon. Gentleman a further and fuller answer after we have done that.

I am glad that the Minister for Europe has picked up on the point about the comitology process—a phrase that does not mean much to our constituents—involved in implementing decisions. He has said that he finds the process opaque and cumbersome, and that it needs review and reform. I have to say that it needs much more radical surgery than is apparently being contemplated by the Government.

I agree with the hon. Member for Tweeddale, Ettrick and Lauderdale (Mr. Moore) that the Government have not yet produced any real proposals either for the convention or for the subsequent intergovernmental conference, to inform and stimulate a national debate. The Prime Minister relies far too heavily on his new-found friends Mr. Berlusconi, Mr. Aznar and Mr. Chirac, possibly to be joined by Mr. Stoiber. This emerging conservative alliance in Europe may be important, but it cannot be a substitute for a real attempt by the British Government to address the democratic deficit.

I am sure that at the end of this process, we shall be offered a simplification of the treaty provisions. We shall also be offered a constitutional text and, probably, some sort of pruning of the legal instruments, which number more than 20. That will not do the trick, however, because slimming down and simplifying an organisation does not, of itself, make that organisation democratic. Nor does it deal with the burden of the past. Here I must mention the acquis communautaire, which comprises the accumulated laws and regulations of the European Union that have built up over the past decades. A modest estimate is that it now runs to 85,000 pages.

The Opposition leader in Malta told me recently that his country had been sent 1.5 million pages of laws, regulations and explanatory texts, which it must introduce into its domestic legislation to qualify for membership. I have suggested that there should be a working party on the acquis communautaire to try to slim it down, but that is an heretical thought. It is seen as advocating a retreat for Europe, but frankly, we have to find a reverse gear as well as a forward one. Otherwise, we shall be not only keeping on the statute book a volume of legislation that is incomprehensible to the public, but placing a most unfair burden on the applicant states.

Mr. John Baron (Billericay)

Is my right hon. Friend aware that whereas the Lord's prayer runs to something like 60 words, and the American declaration of independence to about 350, the EU directive on the import of caramel and caramelised products runs to something like 25,000?

Mr. Heathcoat-Amory

My hon. Friend is quite right. I saw a letter in The Daily Telegraph recently which said that the regulations on the export of duck eggs run to more than 26,000 words.

What are we doing to these small countries? Let us take Estonia as an example. It is now free of Soviet domination, and negotiating to join the European Union. We are imposing on it a common agricultural policy. At the moment it has a free market in agriculture, but while we are trying to reform the CAP at home, we are making Estonia comply with an agricultural policy that we are imposing on it as part of the accession negotiations. More than that, Estonia is having to raise its external tariff as part of those negotiations. Imagine what that will do to the poorer countries to the east of Estonia, such as Belarus and Ukraine, all of which will now have to surmount a higher hurdle to continue to export their produce to Estonia, if and when Estonia becomes a member. Estonia also has to take on the full burden of the acquis communautaire.

Many of those countries in eastern Europe have weak administrative and legal systems, and I doubt whether, in practice, they will be able to comply with this volume of obligation. This has, of course, triggered a reaction. Reference has been made in this debate to Poland, which is already suffering as a result of European Union export subsidies. That has done enormous damage to Polish agriculture, but Poland is now being told that it will be a second-class member of the European Union, and will not even qualify for the agricultural support enjoyed in western Europe. It would not, therefore, surprise me if Poland eventually decided, for that reason and others, not to join. That would be a tragedy, because we must reunite Europe.

The essential mistake is to suppose that reunification of Europe requires a single organisation with an enormous volume of regulations and laws. It would be far better to reform the European Union into a Europe of democracies, and to welcome all the applicant countries into a looser common European structure, without their having to surmount all those enormous obstacles to qualify for membership.

I have asked for a working group on the economic future of Europe, too, because all our political and social dreams for our continent depend on a successful economy. However, we are losing ground in the world economy. We are over-regulated and our competitiveness in those wider markets is under attack, so I have suggested to the convention that we take evidence from outside the European Union. The EU is seen by many, particularly those in developing countries, as a rich man's club. It has higher peak tariffs than the United States or Japan, and launches more anti-dumping measures against developing countries than any other trade block. Our claim to be the friend of the world's poor and disadvantaged therefore rings fairly hollow.

I am afraid that the very strong integrationist momentum in the convention means that the supposed solution to any of these problems is always more Europe. The hon. Member for Leicester, East (Mr. Vaz), who is in his place, repeated the bold claim that the fundamental charter of rights will remain a political document, and will not become a legally binding one. However, that proposition is under attack in the convention; it is almost certain that the charter will be incorporated as legally binding. If, having left office, the hon. Gentleman is still so confident of that claim, it would be interesting to hear from the Minister whether the Government intend to hold out in all cases against incorporation of the charter.

Mr. Vaz

I have every confidence that the right hon. Gentleman will use his position in the convention to ensure that the charter remains something that is not legally binding.

Mr. Heathcoat-Amory

I shall be the last man standing in that particular contest—but I need allies, particularly the Minister, from among the other delegation members.

Angus Robertson

On the question of allies, I am keen to learn a little more about the convention's workings, and about which colleagues the right hon. Gentleman is working closely with. For example, is he in alliance with Jens Peter Bende, who holds regular meetings with the convention? Which political parties from other countries attend those meetings? Do they include the party of Slovakia's Mr. Meciar, or that of Austria's Mr. Haider?

Mr. Heathcoat-Amory

I am a member of several different groups and alliances, some temporary and others shifting. Obviously, I am a member of the national parliamentary meeting, and I regard myself as having a particular duty to protect and advance the interests of this House. I am also a member of the United Kingdom delegation, which holds meetings, and of the European People's party. I do attend meetings organised by Jens Peter Bende, who heads an informal forum, as he describes it, consisting of a rainbow alliance between left and right—an alliance that is to its advantage. I do not know whether a formal membership list exists, but I can confirm that the Austrian Freedom party does not attend those meetings. The great advantage of the forum is that, like me, it puts democracy first. To do otherwise would be to build on insecure foundations.

It is no good advancing the proposition that Europe should do more, get bigger, spend more and have more missions and objectives, unless we secure at its foundations democratic consent from the people whom we represent. At the moment, that consent is lacking. I believe that electorates are trying to send us a message. The sad fact is that people do not vote at all, or they vote unexpectedly, and often for rather nasty people.

If people feel that they are not being offered genuine choices in elections, they express that feeling—as they did in the first round of the French parliamentary elections—by voting for extremist parties. Turnout in European Parliament elections has fallen. Despite the fact that the European Parliament has been granted more powers in the last two treaty changes, turnout in this country was less than a quarter, and less than 50 per cent. throughout the European Union. Although the European Parliament has more to do and takes more decisions, fewer and fewer people feel properly represented by it.

Through referendums, people deliver snubs to the European elite. Switzerland voted no to joining the European Union, Denmark voted no to the euro, and Ireland voted no to the Nice treaty. That is not a very good record for the integrationists, but it seems not to have slowed down or altered their ambition. I again appeal to the Government, and the Minister in particular, not to continue to try to persuade the Irish to change their minds. It creates great cynicism in Europe when an electorate vote no only for the European Union to come back for another opinion.

The impression is gaining ground in Ireland that the EU will continue to shake the Irish electorate until it gets the right answer. Such action is completely unnecessary. The Nice treaty is not necessarily about enlargement. The provisions necessary for adjusting the institutional balance, and the voting in the Parliament and the Council, could be removed from the treaty and put into the accession treaties. That is what happened last time—and I know because I was there: I was the Minister who negotiated the accession of Austria, Finland and Sweden.

If those provisions were removed from the Nice treaty, the rest of it could be quietly forgotten, or swept up in the deliberations of the convention and the 2004 intergovernmental conference. A perfectly good solution exists, therefore, but instead the European Union seems obsessed with bullying the Irish electorate until they change their minds. That should act as a warning to us in any referendum on the euro. If we make the mistake of saying yes to the euro, the matter will indeed be all over; but if we say no, will that be the final decision? We need to know the answer from the Government before we proceed much further.

I am extremely worried about the lack of democracy in Europe. It is expressed in several ways, and electorates are trying to send us a message. However, I do not want to end on a negative or unduly pessimistic note. A solution does exist: we simply need to apply a little political science. Where do people feel democratically represented? At the level of their nation state, surely. It is at state level that public opinion, a single electorate and a demos exist. It is at state level that people elect, reject, dismiss, make changes and choices, and see the results of their decisions. We have a working democracy, which is replicated throughout the EU at member state level. However, such factors are absent in the European Union. There is no European Union demos, and it cannot be created artificially by waving an EU flag, or passing EU laws. It may evolve over decades—perhaps even centuries—but it does not exist at the minute.

Of course, the European Union, and in particular the Commission, are trying to develop a European people and a European mode of thought on an accelerated time scale. Today, the Bruges group has published an interesting document on the taxpayers' money that is spent on funding the European movement, policy centres, endowing university chairs, training journalists, and providing schools and schoolchildren with information on the EU that has a strong integrationist slant. We are paying for that. According to the document, the education material, at least, breaches the Education Act 1996, which tries to prevent the circulation of such partisan material.

Such efforts will fail. I object to them because they are wrong, they are an abuse and they are corrupt—but they will not create the conditions for a supranational democracy in Europe, either. The only solution is to return powers to member states so that issues can be argued and decided at the level of democracy in which most people engage. For issues that must be decided internationally or on a Europe-wide basis—such as cross-border and trade issues—the procedure must be spelled out clearly in a treaty text and must provide for the full involvement of the parliaments of member states. That is the prime task of the convention. If we fail, the EU will fail. If we succeed, we may have a second chance.

6.51 pm

Mr. Ian Davidson (Glasgow, Pollok)

I note that this is not one of our best attended debates—and not just because I have risen to speak. This subject has not commanded the interest of the vast majority of our colleagues because it has not commanded the interest of the vast majority of our constituents. In such circumstances, it is clear that little enthusiasm is felt for a decision to abandon control over our economic affairs or to lose our currency without compensating gains. If the Government have a referendum without having built enthusiastic support, they will lose. In that referendum, many people will take the opportunity to kick the Government. As a friend of the Government, albeit a critical one on occasions when they deserve it, I hope that they will recognise that a referendum cannot be won before the next general election and should not be held. They should make an announcement accordingly.

Trust in politics has been damaged over the past few weeks and days by recent events and the spin and counter-spin. Because of the excesses of spin and the reduction of trust in politics and politicians, we are now less likely to have a referendum. How ironic it is that a key part of the new Labour project has been derailed by the excesses of new Labour practices. Various phrases about reaping and sowing spring to mind.

Three issues divide the House and the British electorate. The first is whether people are for or against the Labour Government, the second is whether they favour British membership of the EU and the third is whether they favour Britain joining the euro in the short term. Only a few hon. Members have been prepared to raise their heads above the parapet and make clear their views on those issues. It is also clear that Labour Against The Euro is the only group that is in line with the majority of the British population on those three issues, being generally supportive of the Government, generally supportive of membership of the EU and generally opposed to joining the euro in present circumstances.

I hope that my colleagues will see the error of their ways and recognise that a referendum would be inappropriate at present. As for those on the Opposition Benches who do not presently support the Government, we have some vacancies remaining on our Benches. For some, we are full up, but if Opposition Members care to apply to me personally I will give them my view on whether we will accept them.

Mr. Vaz

rose—

Mr. Davidson

My hon. Friend can stay. I am even prepared to let him intervene.

Mr. Vaz

I was not applying for membership of my hon. Friend's club. The Government's position is not that we should have a referendum now but that we should have an assessment of the five economic tests at an appropriate time and then have a referendum.

Mr. Davidson

Some people believe that, and I shall say more later.

One of the more attractive elements of new Labour's appeal at the general election and before—to me and to others—was its claim to be leaving dogma behind in favour of what worked. I welcomed that as a change from our enthusiasm for privatisation and the involvement of the private sector in public services. However, we now see an ideologically driven commitment from many in new Labour to the EU and the euro, irrespective of the reality of the position.

Many hon. Members, and those who have left Parliament, have been ideologically committed to the EU irrespective of the objective realities. However, that position was not ignoble for those who grew up and had their formative experiences in the period immediately before and during the second world war. To be in favour of a united Europe that would banish war in those circumstances is a respectable and honourable position. However, we sometimes fail to recognise that the war started more than 60 years ago. Those of my colleagues who are still trapped in that mindset should reflect that the world has moved on.

I regret that some people whom I respect have failed to move on and recognise that the world is now, paradoxically, a bigger and a smaller place. We should have links that go wider than only with our neighbouring countries in Europe. Those of us who take the same view on the euro have been described scathingly as little Englanders. I am prepared to accept that I am vertically challenged, but I find the accusation of being an Englander unfortunate. Indeed, I welcome applications for founding membership of the Scotland-Brazil friendship society for the next few days.

We should not reject little Englandism in favour of little Europeanism. I have been very involved with the Japanese Parliament and found great similarities between our two countries, including our relationships with the United States and with our immediate neighbours. We need to try to build positive links to improve many areas of the world. To look inwards only towards Europe is a mistake. We have had insufficient discussion about the impact of the EU on the third world and I am glad that some hon. Members have mentioned it today. The EU, as presently driven, is too inward looking.

We should have much less dogma in our discussions in Europe, and I turn now to the point made by my hon. Friend the Member for Leicester, East (Mr. Vaz). Paradoxically, I support the Government's position more than they do. I believe that the concept of economic tests is correct and not just a fig leaf. We should consider joining the euro if it is clearly and demonstrably in our economic interest, because not to do so would be to do a disservice to our people. I also believe that the converse is true. I believe that joining simply because of dogma. irrespective of the economics, would be absurd and dishonest and would do our people a disservice.

I feel increasingly that the arguments advanced in favour of the referendum and the tests were no more than stalling mechanisms to get us through a difficult period electorally. It seems to me that there is a sixth test—that the Government intend to hold a referendum whenever they think that they can win it. That does not strike me as the most honourable stance. I would welcome a clear and unequivocal statement from the Government that they will maintain their previously stated position—that the economic tests must themselves be met clearly and unequivocally. Let us have no ifs and buts, and no "on the one hand and on the other hand." I am sure that if the Government adhered to that standard of proof there would be no referendum before the next general election.

It is interesting to note that those who are keen to join irrespective of the economics argued for a long time that if only the Prime Minister gave a lead, the polls would resolve themselves and there would be a swing in their direction. They said that there would be such a large majority in favour of joining that the Government could do it. I do not think anyone could reasonably suggest that the Prime Minister has not come off the fence: it is clear that he favours joining the euro.

There was some discussion earlier about whether the launch of the euro had been a success. It is worth looking at how the polls have moved since the turn of the year. MORI reckons that there has been a 6 per cent. increase in the no vote since then. ICM refers to an increase of 8 per cent., NOP to one of 11 per cent. and GFK to one of 14 per cent. That is despite the fact that the Prime Minister has given as much of a lead as I think he reasonably could have in the circumstances.

I was, in a way, heartened by the speech of my right hon. Friend the Member for Hartlepool (Mr. Mandelson), ever the optimist in these matters. He said that the introduction of the euro had not been a disaster, suggesting that in a sense that in itself was enough for a celebration. According to today's edition of The Daily Telegraph, however, Belgian euros are being refused in France and French euros are being refused in Spain. That is hardly a sign of a raging success.

None of that, of course, touches on the undoubted price inflation that we have seen. My right hon. Friend, regrettably, omitted to mention that the latest opinion polls demonstrate—as I understand it—that more than 55 per cent. of Germans want to abolish the euro and return to the deutschmark. If that is success, by all means let us have more of it, so that we can knock this project on the head in the short term.

It is sad that such an enthusiastic supporter of the euro should be encouraged by temporary fluctuations in exchange rates. Three rollercoasters—the euro, the dollar and the pound—are moving at different speeds and on different levels. The suggestion that the fact that they have moved nearer to each other recently, as they occasionally have previously, indicates that everything is coming right strikes me as an attempt to clutch at straws and to draw comfort from instability. In the circumstances, that hardly seems appropriate.

I recall when the Tories took us into the exchange rate mechanism, a move supported by the then Labour Opposition and enthusiastically endorsed by the Liberals. I think we all remember what a raging success that was. It demonstrates that if all the high heid yins are agreed on something, there must invariably be cause for concern. When the elites agree, the answer almost invariably lies somewhere else.

I mentioned the sixth test, whose existence seems increasingly clear to me as time goes on. Let me now ask whether it is necessary for us to be in the euro to have influence in Europe. Much has been made of how we can achieve such influence by magical means. I was pleased to note from the website of my right hon. Friend the Member for Hartlepool that he acknowledged the position: there we find the statement But joining the euro is an essential condition of Britain leading in Europe and it is accepted by the government that the question is 'when' not 'if. I must confess that in the event of a clash between the my right hon. Friend and the Prime Minister, I tend to side with the Prime Minister. In an interview with La Repubblica, which I will not quote in the original Italian—I would if I could—the Prime Minister said specifically that Britain did not need to be in the euro to be a leader in Europe. As I said earlier, we should make it clear that we will not allow a referendum on the euro before the next general election. Once that issue is out of the way, we shall be in a much better and clearer position from which to move forward—to negotiate, and to discuss how we want to play a part in Europe. As long as the issue is hanging there—as long as the "Will they, won't they?" question remains—all sorts of other issues are clouded.

I do not doubt that it is in our interests to remain engaged in Europe, and in debates on Europe. It is one of the Government's great successes that we have engaged in Europe much more positively than the last Government did. My hon. Friend the Member for Leicester, East and his predecessors and successors engaged on a number of issues. Although—as my hon. Friend will be glad to learn—I did not always agree with their conclusions, theirs was a positive rather than a negative frame of mind, and I think that great strides have been made.

We should, however, consider what being good Europeans really means. In a number of contexts, the impression is given that the only way we can be good Europeans is to make concessions. Gibraltar was discussed earlier today. In that context, it is being suggested that we can be good Europeans only by selling people out or conceding ground. We ought to be much more robust in dealing with our European colleagues. Can anyone imagine for a moment that the French, or the Spanish themselves, would behave as we have in equivalent circumstances? We have consistently sought to make concessions and to find a middle way—and trying to find a middle way always encourages the other side to come up with something even more unreasonable in order to leave us seeking triangulation.

If we were more robust, we would gain more respect than we have in the past. The record of the European Union on a number of important issues—issues that were important to us—has not been all that great. I look at the Liberal Democrats, and I think of fishing. What have the European Union and the common fisheries policy done for the areas that many Liberal Democrats represent? Not a great deal. If I am not mistaken, not so long ago the Liberal Democrats wanted us to withdraw from the common fisheries policy.

Mr. Moore

The hon. Gentleman is mistaken.

Mr. Davidson

I will certainly check, but I am sure that Labour candidates in the south-west will be glad to learn that the Liberal Democrats are enthusiastic about the common fisheries policy.

Angus Robertson

Perhaps the hon. Gentleman has forgotten the occasion last year when the votes of Liberal Democrat members of the coalition on the Scottish Executive reversed a policy that would have introduced a cod compensation scheme. Such a scheme would have been welcomed in the fishing constituencies represented by the Scottish National party in Banff and Buchan, Moray and Angus.

Mr. Davidson

I do not believe in tribal politics, so I am prepared to accept the hon. Gentleman's point, which seemed to be that the Liberal Democrats are a bad lot. Not many fishermen or fisherwomen live in Glasgow, Pollok, so I do not have a direct interest in the matter. However, I can see that the hon. Member for Tweeddale, Ettrick and Lauderdale (Mr. Moore) is bursting to enter the debate, and I shall allow him to impale himself.

Mr. Moore

The hon. Gentleman may have a false recollection of my party's position on the CAP, but I cannot allow him to characterise us as not wanting substantial reform. His father lives in my landlocked constituency, so he will accept that it is not an issue in which I have taken close personal interest over the years.

Mr. Davidson

I am sorry. I mistook the hon. Gentleman for a spokesman. I presumed that he would know about these matters. My father speaks highly of the hon. Gentleman, in that he says that he is better than his predecessor.

Many of the same criticisms apply to the CAP. It has been denounced in this Chamber since I arrived, 10 years ago. The changes have been infinitesimal: prices are still too high, subsidy goes to the wrong places, and the policy remains hostile to the interests of people in the third world and the developing world. Has there been reform? There has not been much. Will there be reform before the enlargement countries join? Someone said earlier that we must tackle the question of the CAP once we get enlargement, but that seems to be the wrong way round.

New members must be full members, not second-class members. A policy that will not be tenable if new countries are brought in ought to be changed before they join. We must get rid of a policy that means that we pay farmers to grow things that we do not need so that we can dump products in a way that ruins world markets, to the cost of the developing world and the third world.

I will believe that the EU can be reformed when the National Farmers Union complains bitterly about falling food prices—although the NFU always complains bitterly that its members do not get enough money. I need clear evidence that food prices are falling and that we are achieving gains from European agriculture before I will believe that the situation is being improved.

Mr. David Drew (Stroud)

My hon. Friend has made a strong point about why the CAP has not been reformed. The only arguments that the Americans have been able to advance for the way in which they have increased subsidies is that they still do not subsidise nearly as much as the Europeans do through the CAP. Does not a fair system of agriculture mean that we should get away from this obsession with the euro and look at how we can reform the CAP? In that way we might take the Americans along with us.

Mr. Davidson

That is a helpful contribution. Until we see evidence that the CAP has been reformed, many hon. Members will be cynical about the proposition that EU reform is just around the corner.

I turn now to the Irish referendum, which was mentioned earlier. I hope that the Government will say whether they go along with the idea that the Irish, having got the referendum result wrong, must go through the process again. Do they consider that the principle—that when a country implements its right to hold a referendum but reaches a decision that the centre considers to be wrong it must keep on going until it gets the matter right—should be adhered to whenever there is a referendum in the EU?

Is it the Government's intention to intervene in the Irish referendum? Will British diplomats, civil servants, members of the machinery of Government, or British political leaders intervene in any way to influence the referendum result? I ask out of curiosity, but many people will want to hear the answer, as it has implications as to whether other EU countries are allowed to intervene in this country's euro referendum. Clearly, if we claim the right to intervene elsewhere, others will determine that they have the right to intervene here. It is important that we spell out the ground rules at an early stage.

Finally, I turn to the level of debate and discussion. It has been a cause of regret to me that much of the debate on the euro has been trivial and tribal. A number of Labour Members believe that we should not join the euro, and we have had a fair amount of vitriol directed at us by some parliamentary colleagues. That demeans politics in general.

On several occasions we have been accused of being dupes. A recent piece compared us with the 1930s pacifists who were "dupes of Hitler", and with liberal members of Communist front organisations who were dupes of Moscow. I find that offensive, as do my constituents. Members of the Government may disagree with our position, but to reduce politics on important issues to name calling brings us all into disrepute.

Mr. Hopkins

Does not my hon. Friend consider that that is a simple case of people who have lost an argument stooping to abuse?

Mr. Davidson

It is a classic tactic for people who are losing a game to start playing the man or woman, not the ball. That is to be regretted, as it diminishes us all.

Rather than be described as a dupe of the Tories, I fully intend to give up some other commitments to demonstrate my independence of mind on other matters. I hope that that will prove constructive for the Government. I have never before knowingly co-operated with the Conservative party, but I am willing to do what is necessary to prove that I am not hand in glove with it.

Some colleagues seem to believe that the height of political sophistication and argument is to wave euro notes before us, as if they were pieces of garlic being waved before vampires. They seem to think that that will make us disappear. A better level of exchange would be appropriate.

I do not often open my wallet, but I want to show my party's Front Benchers that it contains euros, dollars and yen. That demonstrates my internationalism, but it does not really prove anything. I should prefer it if hon. Members supporting the Government's position did not feel that waving euro notes proved anything with respect to their argument. We need a higher level of debate and discussion.

I accept that the argument can be difficult. I listened to our two representatives on the convention, and some of the issues are so intricate that one finds oneself losing the will to live. However, the essence of many of the relevant matters is relatively simple and straightforward and can be explained in ways that most people can understand. We do not need to have 256 pages on caramelisation read out to us to appreciate that there are major issues at stake.

The Government should concentrate on the issues of principle, rather than the trivial, abusive or tribal. If that happens, we can conduct the debate in a way that restores respect for politics and politicians, rather than diminishing it.

7.19 pm

Mr. Robert Walter (North Dorset)

This has been an excellent debate. The speech of the hon. Member for Glasgow, Pollok (Mr. Davidson) was an old Labour tour de force against the euro, which I was pleased to hear. Then there was his revelation that he is not only a regular reader of The Daily Telegraph but believes what he reads in it and gets his inspiration from it.

We have had particularly interesting contributions from the hon. Member for Birmingham, Edgbaston (Ms Stuart) and my right hon. Friend the Member for Wells (Mr. Heathcoat-Amory) on the deliberations of the convention on the future of Europe. It is a matter for some regret that the House spends so little time discussing the important matters that are discussed and decided in the European Union by the Council of Ministers, the European Commission and other bodies. Reference has been made to the Scrutiny Committee, on which I served for nine months in the last Parliament. As I indicated in an intervention on the hon. Member for Birmingham, Edgbaston, it is a matter of regret that that Committee, which is our principal means of scrutinising European legislation, whether in the form of directives or draft directives, conducts its affairs in private. I believe that there should be open and transparent scrutiny of European legislation.

I served on the Committee with a number of colleagues, including my hon. Friend the Member for Stone (Mr. Cash). We tried to persuade the Committee on several occasions that the budget of the European Union should not be discussed in a Standing Committee but on the Floor of the House. It is a most important matter that is relevant to farmers in this country because agricultural spending is such an important component of the budget. The European Union's aid programme is a major item of expenditure in the Department for International Development. Alas, debate on these important areas is hidden away—something that I fear is symptomatic of what has been going on in the European Union ever since we joined.

On 1 January next year it will be 30 years since we joined the European Community, as it then was, and not long after we had a referendum relating to our membership. Since then, British support for our membership of the European Union has been tepid at best because so much of the development that has taken place has been conducted by the political elites not only in this country but right across Europe. We have failed to take the people with us; we have failed to involve our electorate in the developments that we are trying to promote in the British national interest. This secret agenda is often picked up on in the popular press and sometimes appears in the form of misguided headlines in our newspapers.

The fact that this is not only a British problem but exists right across the continent has been exemplified in recent years by the difficulties of some of our partners who have tried to get referendums through on what they thought were perfectly straightforward matters only to find that the electorate revolted because they were not involved in the process or engaged in the debate. I fear that we run the risk of encountering the same problem in this country in the run-up to a possible referendum on our membership of the single currency.

We have failed to take the people with us. Politicians throughout Europe have become detached from the real world. For example, we have talked today about structures, systems, committees and working groups. Yet ordinary people do not see Europe in that context. My own children, for instance, simply see it as a place they go to and come back from; they have no great hang-ups about it and feel part of it. In the next few years, we will require the consent of the British people, whether that consent is expressed in a referendum or simply implied in terms of the votes that we take in the House, on a number of major developments that will affect our future and that of the whole of Europe.

A number of right hon. and hon. Members have talked about enlargement. If we accept all the applicants, it will mean bringing 13 new members into this family of nations. The reform of the common agricultural policy has also been mentioned. I share the frustration of the hon. Member for Glasgow, Pollok about how often we have talked about that. I guess that it has been in every major political party's election manifesto since the day we joined the European Community. However, every reform process ends up costing the taxpayers of Europe yet more money, becomes more complex and gets into more areas of agriculture. Even the most recent reform, which was supposed to be the prelude to enlargement of the EU, ended up costing more than was the case under the previous regime.

We have to reform the CAP before we can accept those 13 applicants as full members of the Union. If not, the costs for Europe's taxpayers will be astronomical. To accept those 13 member states and enjoy the current subsidy regime under the CAP would require so much from the taxpayers in the rest of Europe—it will not come from the taxpayers of the new, less prosperous nations—that there could be a revolt.

Many EU members have enjoyed a very generous structural funds regime, the most obvious examples being Spain and Ireland. Structural funds are also available in this country, France and a number of other countries in the existing European Union. However, those funds will shift, quite dramatically, to the new members of the European Union, which will have more justification for having them than those in the west.

We have lots of bright ideas about a common foreign and security policy, which goes back to the Maastricht treaty. However, that concept is at present totally inadequate. I have no problem with the common foreign and security policy as long as our fellow member states are prepared to make a commitment to it. I believe that the United States sees Europe having a greater presence in NATO—whether separate from the US but still part of the NATO structure, or additional to NATO. So far, however, there has been no new commitment from some of our EU partners to making available troops and materiel to make that structure work.

There could be some operational problems with the common foreign and security policy unless it is applied only to a small operation that could be handled by a national command and control structure. Any larger operation. especially one involving the 60,000 troops anticipated for the rapid reaction force, would still require the full commitment of the NATO command and control structure and SHAPE—Supreme Headquarters Allied Powers Europe—at Mons.

We shall also have to face the challenges posed by free trade and by the World Trade Organisation. If Europe is to look outwards, it should be creating a North Atlantic free trade area which brings together the North American Free Trade Area and the European Union. We must break down the existing trade barriers that have worsened on the other side of the Atlantic. Beyond that lie the challenges of the developing world and, within the United Kingdom, the possible referendum on the single currency.

I am delighted that we have heard contributions from two of our members of the convention on the future of Europe and I look forward to hearing from the third as part of the winding-up. For the first time since we moved to a directly elected European Parliament in 1979, Members of national Parliaments are formally part of the EU process. I welcome that development; we are beginning to get some joined-up government in the EU.

We must move on from that, however. Not only in the UK but throughout Europe, national Parliaments and national political debates have become detached from the reality of what takes place in our name at the European level. Also detached from those debates is the reality that every year millions of Britons travel in Europe on holiday and on business. They work and live on the continent, but we conduct our debates as though those people did not travel. Our debates are often conducted in the language of 1942 rather than that of 2002. We must try to set up a more adult and grown-up debate about the future of our continent.

I mentioned the goal of enlargement and the 13 new member states, but we must also consider the consequences of that enlargement. There will be consequences for the reform of the common agricultural policy, which will also be affected—as my right hon. Friend the Member for Suffolk, Coastal (Mr. Gummer) pointed out—by the new US farm Bill. That will result in a tit-for-tat operation by upping the ante on subsidies. We must come to terms with that if we are to make any sense of the last WTO declaration at Doha, which refers to getting rid of our subsidy-dependent culture in the industrialised world, not only in Europe but in north America and Japan.

We must stop contemplating our navel and start to look outwards. A Europe that looks outwards across the Atlantic to north America and to the wider world to genuine free trade and recognises that globalisation can be harnessed for the benefit of the whole world is a Europe that will survive.

There is, however, an issue on which Europe must start looking inwards—the whole question of accountability. I was a little disappointed by the Foreign Secretary's response to my intervention when he told us that the Council of Ministers was to be televised but that we would not actually see any of the discussions, as that might be slightly embarrassing, but only the votes. That will probably be a waste of television time, as the voting process is not terribly interesting. A piece of paper would tell us how our Ministers had voted. What we really want to know is what our Ministers are saying in the Council. Are they representing our national interest in the Council of Ministers? What is the French Minister saying? What is the German Minister saying? Why are we agreeing or disagreeing with them? Why have we arrived at the compromise that the Council—as it often does—votes for unanimously? We deserve to see the Council in action as a legislative body, rather than being treated to the sight of 15 people putting their hands up, which would make for rather boring television and would receive even less coverage than our debates in this place.

I am also concerned about the scrutiny process in our national Parliaments. As a first step we must crank up that process in this place. So much comes from Brussels. At meetings of the Scrutiny Committee, umpteen documents are listed by number. The Chairman of the Committee reads through the list—as the Committee meets in private, I hope that I am allowed to say this—and if one is really smart, one can propose that the Committee discuss a particular point. If one feels that it is especially important, one might at least get the Committee to consider referring it to one of the European Standing Committees.

The meetings of those Standing Committees are rarely covered in the press. I sit on European Standing Committee B which yesterday held a most important debate on asylum seekers and their common treatment throughout the European Union. There have been acres of newspaper coverage of that subject but I do not recall seeing any reference in this morning's press to the only debate in this place on the scrutiny of proposals that will be brought into legislative effect throughout the EU. I am also somewhat sceptical—as was the Scrutiny Committee brief—about the Government's optimism as to the effect of the proposals.

We must involve our national Parliaments much more closely in what goes on in the European Union. Our electorates look to us when they criticise what comes from Brussels. Those directives that Christopher Booker and other journalists write about have been approved by Ministers who sit on the Treasury Bench. Those Ministers vote on them. Ministers who sit on the Treasury Bench approve those so-called Brussels directives—those things that Brussels sends us, which we have to implement and which are supposedly imposed on us. They are not imposed on us; we have a agreed to them, and Ministers of the Crown should be accountable for those decisions. We have to make that point over and over again. That is why national Parliaments should be much more at the heart of the scrutiny process than they are today.

I have a great deal of respect for many good friends who sit in the European Parliament, who spend hours discussing the detail of such documents, but our electorates look to us, and not to our friends in the European Parliament, for such scrutiny. That is why we must have a much more transparent debate on what occurs in the European Union.

I want to refer briefly to the euro. This is neither the time nor the place to discuss the merits or otherwise of whether we should join the European single currency, but I am somewhat saddened that one of our newspaper proprietors has seen fit to instruct his editors—or so it is reported in the Financial Times—to give only one side of the argument in their papers. If the British people are to be asked to take that decision—as I believe they should be asked in a referendum—the facts need to be put before them and both sides of the argument should be expressed to them dispassionately.

The decision should not become some sort of xenophobic or tribal decision about whether or not people are British or whether joining represents the end of sovereignty and democracy as we know it. We should actually look at the facts. That involves treating the British people as though they are adults, and considering not only the infamous economic tests but the political questions that my constituents certainly want asked about whether the decision is in Britain's national political interest.

If the Government and those who believe that we should join the European single currency can convince the British people that this is not about the creation of a European superstate—that they believe that Europe is a union of sovereign nation states and that that sovereignty will ultimately rest with the nations states—the British people will be far more amenable to considering the economic tests that the Chancellor has laid down. So the challenge for the Government and those who believe that Britain's future lies with Europe and membership of the single currency is that they have to convince the people that Britain is strengthened, not weakened, by an enhanced role in the EU.

7.43 pm

Mr. Keith Vaz (Leicester, East)

These debates are important because they provide the House with an opportunity not just to discuss the forthcoming European Council meeting in Seville, but to express our views on a wide range of issues.

I am very disappointed that, uncharacteristically in such debates, we have not been graced by the presence of the hon. Members for Stone (Mr. Cash), for Buckingham (Mr. Bercow) and for Aldershot (Mr. Howarth), who always make interesting contributions. Of course they have now been promoted to the Front Bench. That is perhaps one reason why we have not heard from them this evening, but this has been a good debate because it has allowed us for the first time not just to discuss what will happen at the European Council meeting, but to assess what has been going on in the EU during the past six months.

I was fascinated by the accounts of the convention given by the right hon. Member for Wells (Mr. Heathcoat-Amory) and my hon. Friend the Member for Birmingham, Edgbaston (Ms Stuart). The convention has been fashioned in a unique way. Members of national Parliaments will be allowed the opportunity not only to take part in a very important decision-making process, but to return to the House to give us the opportunity to question them and to hear what they have to say. That is extremely necessary.

Frankly, someone who met the right hon. Member for Wells and my hon. Friend the Member for Birmingham, Edgbaston separately would not think that they had much in common, but I am very pleased that they are working together, perhaps from different perspectives. They will go to Edinburgh, Cardiff and, this week. Belfast to discuss with the law makers in different parts of the United Kingdom how we can improve the way in which the EU operates.

My plea to the Minister for Europe is to continue the work that he and the Foreign Secretary have been doing on the reform agenda. They have both worked extremely hard to ensure that, although the EU's agenda is necessarily busy, the reform agenda remains very much a British initiative. We need to recognise the work that Neil Kinnock, one of the two European Commissioners from Britain, is doing on reforming the operation of the Commission's personnel, but we should applaud and commend what Britain is doing—what the Foreign Secretary, the Prime Minister and the Minister for Europe are doing—in constantly pushing forward the reform agenda.

The hon. Member for North Dorset (Mr. Walter) says that he wants television cameras to be present because he wants to check on what Ministers are doing and whether they are defending Britain's interests. Well, I can assure him that this Government, like the previous Government, defend Britain's interests to the hilt. The right hon. Member for Wells was a Minister in the last Conservative Government. He did not attend those meetings to allow the French, the Germans or anyone else to try to pursue their agenda without offering any resistance. Ministers are able to attend and fight Britain's corner, and they do so very effectively because they have tremendous support from our civil servants.

I pay tribute to Sir Nigel Sheinwald and his team in Brussels for the way in which they help British Ministers to press what we believe to be in the best interests of Britain and, indeed, the EU.

The hon. Member for North Dorset should have no fears about what happens. He and other hon. Members should not criticise the work that is being done throughout the country in trying to reconnect the British people to the EU. Clearly, that work has to be done. There was criticism that money was spent on publishing pamphlets and other activities because it was felt that that was not necessary, but I believe that it was vital. It is the best way to communicate with our people about the effectiveness of what we can achieve in the EU. If we say nothing and leave such things to a very Eurosceptic media, we will simply not get our message across.

Mr. Heathcoat-Amory

No one objects to information, but as the pamphlet clearly shows, the spending is biased in favour of those giving an integrationist, pro-European slant, and it is done with taxpayers' money. That is contrary to any guidelines that apply to the British Government over their expenditure. Why should we tolerate that from the EU; it is all taxpayers' money?

Mr. Vaz

I will study the pamphlet. I have not received a copy myself—perhaps those involved know that I am convinced of the argument, so they have not sent me one—but I will study it. However, I am trying to make the point that it is important that Ministers and others should go out to the country to talk to people about the benefits of being in the EU, and we should continue that process. If we were to fail to do that, we would simply not give the British people value for money. I hope that people will be told about those benefits.

I also want to ensure that the reform agenda is implemented now. We simply do not have to wait for treaty changes to do many of the things that we would like. In my intervention on the Foreign Secretary, I referred to the letter that the Prime Minister and Chancellor Schröder wrote to José Mariá Aznar, the Spanish Prime Minister. That letter contained 20 or so principles and suggestions to improve the way in which the EU manages its business, from how the presidency operates right down to how the agendas are formed. Is it necessary for Heads of Government—busy people—to sit around the European summit table and to have to read out their positions in turn? That may be possible now, but when the new applicants enter in 2004, it will simply not be possible to finish meetings; they will go on for ever.

That was one of the problems at Nice—a crucial conference, designed to ensure that we prepared the EU for enlargement, where we were negotiating about how many votes each country would receive in the Council of Ministers. It went on for days and, quite rightly, not just our Prime Minister, but leaders of other European countries were very concerned about the length of time that it took.

We must reform the agenda. We must make sure that the decisions are communicated effectively to people. The right hon. Member for Wells picked up something that looked like a very large telephone directory and referred to it as volume 45. If it is volume 45, I do not know what volumes 1 to 45 would look like, or whether there are more than 45 volumes. Clearly, it is necessary, in the interests of the environment at least, to cut down on the amount of paper that flows from Brussels. We can only do that if we reform the way in which the Commission operates, and if we try to make sure that people are alerted at a very early stage to what is happening in terms of the decision-making process. We can achieve that without the need for treaties.

The letter of 25 February 2002 went to the Spanish Prime Minister, as Spain has the presidency until after the Seville European summit. Javier Solana, the Secretary General, then produced his own paper preparing the Council for enlargement. That was presented at Barcelona, and several sensible proposals were put forward that, again, did not require a treaty change. I hope that the Minister for Europe will make sure that we press on with the reform agenda. We must find out what happened to the Prime Minister's letter, how many of the points sensibly raised by the Prime Minister and Chancellor Schröder have been dealt with, how many of those points remain, and how we can make sure that we focus the minds of the European Commission and Mr. Solana, who works with us on these issues, to ensure that these other points are completed. Those are my comments on reform.

The debate began with a discussion of immigration and asylum policy. Every time I come into the Chamber, there seems to be a debate on immigration and asylum. For two days last week, my right hon. Friend the Home Secretary was talking about immigration and asylum. Today, obviously, my right hon. Friend the Foreign Secretary began by talking about immigration and asylum, and goodness knows when it will be raised next—perhaps in a debate on economic policy. We need to make the point clearly that it is right that we should discuss these issues. We should also use the opportunity of Seville, however, to make sure that the other European countries put their good words into action. That means ensuring that common agreed policies are implemented and that problems are tackled at source.

I am not sure that I am entirely convinced that the way to deal with the issue is to sanction or penalise third-world countries into behaving differently. I do not think that that can be done. I understand why the Government have made the suggestion, and it merits discussion and attention, but I am not surprised that countries such as Sweden and others have said that it is not practical, as I do not think that it is. We need to consider an alternative method.

I shall give the House two examples of people who have come to my surgery in the last few weeks. One was a Dutch Somalian woman who had the right of residence in Holland and who has decided to come to live in Leicester in the United Kingdom. I am very happy that she has chosen to come to Leicester, which is a multicultural city. We welcome people from all parts of the world if they wish to be part of the Leicester experience. I asked her, not as an inquisition but for information, why she chose to come to live in Leicester. To use Daily Mail speak, I asked her whether she came because the benefits were higher in Leicester, or whether it was because we provided council housing more quickly—[Interruption.] It is kind of my right hon. Friend the Minister for Europe to suggest that she chose Leicester because of me, but I do not think that that was the reason. I asked her whether she was better off here. She said that she was not. She said that she received higher benefits in Holland and was provided with accommodation immediately there. She wanted to come to Britain, England and Leicester in particular because she felt safer in Leicester than in Holland. There are mosques for her to attend there and a fairly large Somalian community, as there is in Birmingham.

Last week, a woman who had come from Ethiopia via Stockholm with her three children visited my surgery to complain about the accommodation that she had been given. She had been given damp accommodation, and I wrote to the council on her behalf. I asked her, "Why did you choose to come from Stockholm to here? Was it because the housing was not particularly good?" She said that she had a wonderful flat overlooking the wonderful city of Stockholm but she preferred to come to the wonderful city of Leicester. I asked her again why she came to Leicester. She said that she felt safer in Leicester than in Sweden and that her family were settled here.

In our discussions and debates with our European allies, we must remind them of the need to value ethic minority communities, which have made such an important contribution to the life of our nation. The message coming from people who have rights of residence—they are not asylum seekers or illegally here but people who choose to come here with rights of residence from EU countries—is that they choose to come to Britain because they feel that they are valued and treated better here. We must tell our allies that they should do more to ensure that their ethnic minority communities feel as valued and as safe as they do when they come here.

My third point is in relation to the justice and home affairs agenda. Tampere was extremely important. Like my right hon. Friend the Foreign Secretary, I was present at the Tampere summit, and it was good to see co-operation between countries on this important area. I want us to do more, however, on the issue of child abduction in the European Union. I have written to the Prime Minister about this, and I hope that the Minister for Europe will remind him that a letter was sent last week concerning the case of Catherine Meyer, a British citizen whose two sons were abducted by her German husband, and who has been treated appallingly by the German courts. I am very pleased that the issue has all-party support—I do not agree with the hon. Member for Stone on many European issues, but we agree on this. It is vital that we consider the case in the context of the appalling behaviour of the German courts. When an EU nation is a close ally of the United Kingdom, we should make sure that its courts dispense justice and that they do not merely act in the national interest. I hope that my right hon. Friend the Prime Minister will raise the case with Chancellor Schröder in the same way as it was raised by President Clinton and by President Chirac. I hope that we will achieve results in that regard.

I have two final points. One is on the issue of enlargement, which has been mentioned by all Members who have contributed. The shadow Foreign Secretary, the right hon. Member for Devizes (Mr. Ancram), who has returned to the Chamber from his other meetings in the House is rewriting history. He tells us that the Conservative party is in favour of enlargement. I know that it is not his fault—he did not fashion the policy as he was not the shadow Foreign Secretary at the time; it was the right hon. Member for Horsham (Mr. Maude), who was the co-signatory to the Maastricht treaty. He came to the Chamber on many occasions and said that he and his party would oppose Nice, and that the effect of opposing Nice would be that the enlargement process would be blocked. Of course, in practice, that would have been exactly the consequence of what he proposed to do. I am glad that the right hon. Member for Devizes has been converted and that he has changed the policy of the Conservative party.

We must have enlargement. We must welcome applicant countries into the European Union. Not only will that create the largest single market anywhere in the world, with 500 million consumers, and benefit our economy by about £1.75 billion a year, but it is important, politically and historically, that we unite Europe. If we look at the road map for enlargement, the 30 chapters have been opened in respect of all 12 countries with candidate status except Turkey. I have been surprised by the progress made under the Swedish and Spanish presidencies to the extent that the lead country, Cyprus, has closed 28 chapters, and even the applicant country that is right down the list, Malta, has closed 22. I was astonished that Bulgaria, which we thought would not join in the near future, had already closed 20 chapters, and by Commissioner Verheugen's statement in Brussels that 80 per cent. of the chapters would be closed by the end of June. That is astonishing progress and a credit to Commissioner Verheugen and the United Kingdom, as we have been the champion of enlargement. That process was begun by a speech in Warsaw by the Prime Minister and pursued by the Leader of the House—when he was Foreign Secretary—and by the current Foreign Secretary and the Minister for Europe.

Enlargement is crucial for the success of the European experience, so will my right hon. Friend the Minister tell us whether he is convinced that all 10 applicant countries, other than Bulgaria and Romania, will join the EU by 2004? I know that Ministers are reluctant to put figures on that but, in the past, we talked about waves of entry. Will we have just one big bang in 2004 before the European elections?

The shadow Foreign Secretary was a Minister in the previous Conservative Government and he spoke about agricultural reform. For 18 years the Conservative party in government did nothing about reforming the common agricultural policy. It is all very well to come to the House now to say that he wants reforms, but we have been arguing for them. [Interruption.] The shadow Foreign Secretary knows how many vested interests are involved in the CAP, and even five years is not long enough to overcome the vested interests, especially those of the French, in the CAP.

We want to ensure that the CAP is reformed, and we cannot use reform of the CAP as a means of stopping the enlargement process. Reform must wait until after enlargement, but the Government are committed to it and we will do it, unlike the shadow Foreign Secretary and his colleagues who say that they want reform but will not bring it about.

My final point is about the euro. I am sure that my hon. Friend the Member for Luton, North (Mr. Hopkins) will speak about this issue, but I am sorry that my hon. Friend the Member for Glasgow, Pollok (Mr. Davidson) has gone. He made a very thoughtful speech. Government policy has remained the same for the past five years; it has not changed. There is no question of a referendum now. The Government have made it clear over five years that the economic tests will be assessed. Only after they are assessed and only when it is in the national interest will the Cabinet, Parliament and then the British people decide on whether we join the euro. It will be not this House or one person to decide as happened under the Conservative Administration—and as expressed in the Conservatives' election manifesto—when the Conservative party's former leader and the shadow Cabinet were left to decide. The people will decide, and that remains the right course of action.

I wish my right hon. Friend the Minister well in Seville. I know that he, the Foreign Secretary and the Prime Minister will bat very hard for Britain as they always do. I know that the policy of positive engagement that started five years ago will continue in Seville and that we will get an agenda that suits Britain and Europe.

8.2 pm

Mr. Mark Simmonds (Boston and Skegness)

I am pleased to follow the hon. Member for Leicester, East (Mr. Vaz). Like all other Members who have spoken in the debate, he urged reform, particularly of the lack of democratic accountability in the European Union. He also urged the essential reform of the CAP. Much of the debate has been about the minutiae of the detailed changes that are required. However, much more fundamental reform of the EU is required if it is to be responsive to the demands and the needs of the populations that it purports to represent.

The world and Europe have altered significantly since 11 September. The old enmities and animosities have been brushed aside in an optimistic surge and spirit of co-operation. The United States and Russia are working together to combat terrorism and to reduce their respective nuclear capabilities. Pakistan, Syria and Iran have played their part and have certainly not stood in the way of the eradication of al-Qaeda.

Although Britain rightly continues to fulfil its role in assisting the United States, I have grave doubts that the Prime Minister could and would have been so courageous had we had in place a fully operational and fully fledged common European defence and foreign policy. As the right hon. Member for Hartlepool (Mr. Mandelson) eloquently pointed out, I suspect that we would still be discussing the issues at European level without any action having been taken. However, as a nation state, we quite rightly rallied, as we always do, behind our excellent armed forces.

The fundamental lesson that we must learn from the ghastly events in the United States is that nation states can and will co-operate when it is in their mutual interests to do so. Nation states will not always agree on every issue. It is therefore a prerequisite to co-operate where necessary or where mutual advantage exists and not to have forced co-operation between states when no mutuality of advantage exists.

It is clear that all the interests of one country are not shared with the same countries. This point is exemplified and exacerbated by the current European Union structures where, irrespective of national interest or disinterest, a single policy approach is considered applicable. This forced and often false co-operation both degrades and erodes the necessary flexibility that should be allowed to flourish. It is vitally important that the United Kingdom, with its strong historic transatlantic ties and its historic Commonwealth connections, be allowed to maintain flexibility of social, economic and diplomatic arrangements, especially at a time of ever increasing and accelerating globalisation, as evidenced by China's recent rejoining of the World Trade Organisation.

Flexibility must be the bedrock of any future European integration, particularly as the EU expands eastward. The retention of power in national Parliaments and the principle of subsidiarity must not be maintained just at existing levels, but must be enhanced. The mendacity of fudge and compromise leaves dissatisfied and disaffected countries, Parliaments, national and regional politicians and, most importantly, a disengaged electorate who rightly believe that double dealing and duplicity are the order of the day. This democratic deficit is extraordinarily dangerous.

When the electorate feel left behind and ignored, and when the political elite move in one direction and the electorate wish to move in another, it is inevitable that, if only through despair, those who flaunt and propound abhorrent views and policies will attract support. We have recently seen that phenomenon in France, Holland and, thankfully to a lesser extent, in the United Kingdom. There is a direct correlation between the democratic deficit and support for extremists. There is also a direct correlation between this democratic deficit and the continuing downward spiral and low turnouts in the last general election in this country and in recent elections in Europe.

A simple issue requires addressing. Within the European Union, the bodies that have power and control are not in any way democratically accountable. I have a few suggestions as to how we could start to remedy that problem. First, the Commission should become an administrative body—a civil service—with no political authority. Secondly, the Council of Ministers, which has a semblance of democratic accountability, should be charged with greater political responsibility and initiation and enacting powers.

Thirdly and more crucially, as has been alluded to by my hon. Friend the Member for North Dorset (Mr. Walter) and others, this Parliament and other national Parliaments across Europe should have a greater and earlier role in scrutinising, amending and ratifying the legislation, directives and draft directives that emanate from the EU. That would avoid the necessity for unanimous votes within the EU and give real power back to democratically elected and accountable Parliaments, which would have to answer to their electorates for the decisions and changes that they make. It would also allow individual nation states to forge alliances and to enact legislation when it was in their national interest to do so, and to block legislation and directives that may be detrimental or irrelevant to one country without stopping others who might wish to have that legislation or those directives. The other countries would not have to use their veto at the European level.

Greater co-operation between us and our European neighbours should be forthcoming in other ways, which hon. Members have already mentioned. Asylum is at the forefront of concerns and I am pleased that it is high up the agenda for the forthcoming Seville summit. We do not co-operate enough to combat the crime that crosses geopolitical boundaries. We also clearly need to co-operate more on the environment. It is obvious that many parts of the EU suffer from industrial pollution and emissions that damage the atmosphere and other parts of the EU, as the problem crosses political boundaries.

I remain worried that in a fast-moving global economy, with capital not only disrespectful but ignoring political boundaries, the EU seems to be inward looking and introspective rather than outward looking and flexible. We should consider ways to enhance our populations, especially by increasing the choice offered to consumers through encouraging free trade. We should not encourage protectionism, which in agriculture has the additional unpleasant and undesirable side effect of extenuating poverty in third world developing countries and perpetuating economic migration and asylum. It is not until we get to the root of the problem, which is resolving and amending the common agricultural policy, that we will start to have an impact on economic migration and asylum.

The arrival of global markets and electronic technology make political boundaries irrelevant in trade terms. The last set of structures required to deal with such a market is an overcentralised, over-regulated, protectionist, over-bureaucratic and undemocratic union of states. We should be promoting competition, not harmonisation, especially of fiscal and monetary policy, and we should be promoting diversity and flexibility, not fostering uniformity and unaccountability.

8.12 pm

Mr. Kelvin Hopkins (Luton, North)

There have been many interesting speeches and I am pleased to participate in the debate. Before I focus on my main concern, which is economic, I want to comment on scrutiny. For five years I have been a member of European Standing Committee B and I make the most of it. A Minister is present for two and a half hours. Often not many hon. Members speak, and it is possible to get to grips with the subject. It is probably inadequate—I have no illusions about the extent of our democratic power and my influence—but our scrutiny system is better than those employed in other member states where scrutiny is even less effective.

Mike Gapes

I do not know whether my hon. Friend has studied the Swedish or Danish parliamentary models, but he is wrong about the effectiveness of their Parliaments.

Mr. Hopkins

I am pleased to hear that. I am a great admirer of Denmark and Scandinavia in general, which has a social democratic tradition. The evidence on the effectiveness of the systems used in other member states came out in one of our debates in Committee. I am pleased to be corrected about our Scandinavian colleagues, but I understand that scrutiny is scant in other major nations.

I want to concentrate on the economies of the eurozone which are now in difficulty. There could be a serious crisis if changes are not made. However, I also want to mention Britain's attitude to the euro. A large majority of British voters are against UK membership of the euro. That opinion has not shifted much for a considerable time and it remains firm. There have been many polls on the subject and a recent one suggested that 57 per cent. would vote no and 21 per cent. would vote yes. So a substantial majority is against membership.

What interests me more is that a majority of Labour voters would vote against UK membership. It is right that their view should be represented in the House, and I am pleased that I am in tune with a majority of people who vote for my party.

I caution those euro enthusiasts who are keen on a referendum. Let us consider the opinion polls. Before Denmark's last referendum on euro membership, its whole political establishment—the political class, the political elite—unanimously favoured a yes vote, and the opinions polls showed a 9 per cent. majority in favour of it. However, the vote was lost by 12 per cent. Enthusiasts should bear it in mind that referendums do not always go the way they might like, especially when a change is proposed rather than settling for the status quo. A yes for the status quo is much easier than a yes for change.

Opinions can be mistaken, however. Although I do not think that I am wrong, we need to hear the arguments and the facts. Indeed, I spent time with a Conservative Member who said, "Let's look at the facts." So let us do that. I do not suppose that I have much in common with Sir John Egan, the new president of the Confederation of British Industry, when it comes to politics, but he said: Strong arguments in favour of joining the euro have yet to be made and my suspicion is that there aren't any". I agree strongly with him on that.

Let us consider trade. We are constantly told that if we do not join the euro and get into the eurozone our trade, and, as a result, our standard of living, will suffer. In the two years since the euro has been in effect, British trade with the eurozone has increased more than any other member state's. UK exports to the eurozone have increased by 24 per cent.; German exports have increased by 23.1 per cent.; and French exports have risen by 21.2 per cent. I suggest that we are doing rather well in trade terms without being a member of the eurozone. I am confident that we can run our economy successfully outside it. I am also sure that it will remain strong while we continue to maintain good relations with our neighbours on the continent.

The real problems relate to the exchange rate. A recent estimate by Oxford Economic Forecasting suggests that if an exchange rate for entry was 10 per cent. above an equilibrium exchange rate, that would cost 4.2 per cent. in terms of output and would cost 300,000 jobs. It is difficult to estimate what an equilibrium exchange rate would be, but that would be the effect were we to be 10 per cent. above it. The only way to have an equilibrium exchange rate is to maintain one's own currency so we can adjust it over time to ensure that it is at an appropriate level in terms of value relative to other currencies. A single currency does not allow that to happen.

It has been said—a suggestion leaked by the Treasury, apparently—that before entry Britain would have to depreciate its currency, or devalue, by 30 per cent. That might be excessive. A more recent figure suggests 20 per cent. because the pound has come down slightly against the euro. Those figures are considerable. I suspect that the eurozone would not accept Britain into the euro with a pre-entry devaluation of that order, because it would give us a substantial competitive advantage and we are already doing quite well. However, it would be disastrous in the long term if we locked in at a high exchange rate.

We have to retain exchange rate flexibility. I am not a floater. I would like a stable exchange rate system, as we had after the war, with perhaps more frequent small changes in rates. That was called "crawling peg" in the 1960s and I am a fan of it. Such flexibility is an essential lever of macroeconomic policy. When we talk about little England, let us not forget that Britain is the fourth largest economy in the world. When one travels to smaller countries in Europe, one realises that we live in a populous and economically powerful country. We are not little England; we are actually quite big Britain.

Let us consider the rest of the eurozone, because that is where the problems lie. There are 4 million unemployed people in Germany. Last month, unemployment increased by 60,000. Growth there is optimistically forecast to be about 0.5 per cent. in the next year. So Germany has serious problems. By any standards Germany is going into, or is already in, recession.

In such circumstances a sensible Government would do one of three things, or possibly two or even all three of them. They would try to depreciate their currency if they had a competitiveness problem; they would try to cut interest rates; they would relax fiscal policy. However, Germany cannot do any of those because it is in a single currency arrangement—it cannot depreciate, it cannot cut interest rates and it cannot relax fiscal policy because the stability and growth pact specifically forbids that.

Germany is now in deficit. The deficit is still below 3 per cent., but if Germany gets close to that figure it will be told by the Commission to cut its deficit. If a country is already in a recession and it is told to cut its deficit, it is being told to deflate its economy. If one deflates an economy during a recession, it goes further into that recession; it does not recover. That is what would happen to Germany, so I suspect that it is very worried about its difficulties. Given that its Government are facing an election this year, I imagine that they are trying to hold off any serious decision about the matter until afterwards, but at some point the reckoning will have to come, and I suspect that this will be a topic of discussion in the bars and restaurants of Seville in a few days' time.

One can understand that many Germans are worried about their position in the euro. My hon. Friend the Member for Glasgow, Pollok (Mr. Davidson) pointed out that 54 per cent. of Germans want the deutschmark back, and that is not because they are being xenophobic or hostile to the rest of the world, but because they realise that they went into the euro with their currency over-valued, and they cannot devalue. That means that there is now an inherent deflationary force in their economy which they cannot change.

France, quite sensibly, has suggested, as has my right hon. Friend the Chancellor of the Exchequer, that the growth and stability pact should be made more flexible. However, a member of the Commission—I believe that it was a German—recently said that any attempt by a large country to break the pact would be a disaster, and reminded the French Government that the only thing that matters is the promise made in Barcelona". On the one hand, the Commission is saying that there will be no change and the pact must be rigidly enforced, but on the other hand France is saying, "Let's be a bit flexible." I suspect that this will be another topic of conversation in the bars and restaurants of Seville.

The reality is that it is essential that major economies have separate currencies if there is to be sensible economic management and if countries are to get on well with each other. We can have a mutually agreeable international arrangement for running our economies, as we did in the post-war era, but if we try to force countries together into a single currency when their separate currencies would naturally diverge over time, that will cause serious economic problems.

Britain is in a very advantageous position at the moment. Our economy is stronger than that in the eurozone and our inward investment is higher. There is absolutely no argument for entering the eurozone or joining the euro. Indeed, it is possible, if not probable, that in a few years some countries inside the eurozone will be considering whether they ought to recreate their own currencies.

Mr. Wiggin

One of the difficulties, as I am sure the hon. Gentleman will agree, is that once a country has committed itself to the euro and its debt has been denominated in euros, it is impossible for it to withdraw. Countries may be tempted, or have a strong desire, to withdraw from the single currency, but does the hon. Gentleman have any ideas about whether they will be able to do so? I do not think that they can.

Mr. Hopkins

It would not be easy. It would have to be done by international agreement to dissolve the single currency, rather than by a single country withdrawing, and an arrangement would have to be made about the debt. There are examples of groups of nations with a single currency that has been dissolved, sometimes with a lot of economic pain. The Soviet Union is one such example, and the Czech Republic and Slovakia is another more recent one. Not long ago I went to a lecture by the former Prime Minister of Czechoslovakia, who handled that parting of the ways. The two countries successfully separated their currencies. Theirs are not strong economies like ours, but they are functioning. Of course if they both enter the eurozone, their currencies may be reunited.

My argument is that the sensible way forward for coherent and separate economies, with separate polities, is to have their own currency and, over time, to adjust its value relative to that of other countries. In that way, they can ensure that they keep the economy in balance and they do not suffer either from being over-valued and losing out on trade or from being under-valued and having too much inflation. There is a sensible value for most currencies at any particular point in time, but it changes, and the only way to deal with that is to retain one's own currency. I suggest that that is the way forward for Britain.

8.25 pm

Angus Robertson (Moray)

I am pleased to be able to participate in this important debate on behalf of the largest opposition parties in Scotland and Wales—the Scottish National party and Plaid Cymru. I am also pleased to participate as a member of the European Scrutiny Committee, which is set to publish a report on the role of democracy and accountability, and of national Parliaments. Many of the issues that have been discussed today are covered in that report, which I commend to hon. Members.

I want to associate myself entirely with the Foreign Secretary's comments at the beginning of the debate about the tragic situation in Israel. On a less serious note, I dissociate myself entirely from the remarks of the hon. Member for Glasgow, Pollok (Mr. Davidson) and, in the finest civic and inclusive traditions of the SNP, in the run-up to the England-Brazil football game I condemn narrow-minded nationalism and wish England all the best in that match.

Of course, Europe and our relationship with the European Union are reserved matters. It is for Ministers, representing the UK Government and the UK Parliament to channel the wishes and aspirations of the democratically elected politicians of Scotland, Wales and Northern Ireland—despite the fact that the overwhelming proportion of European business relates to devolved matters, so this House rightly has no say in them.

That is the nub of a problem that has not yet been debated today. I find that interesting because we regularly hear, especially from the Labour party, that that is the optimal way to represent the interests of Scotland, Wales and Northern Ireland—yet there has been not a single mention of the views of MSPs, Members of the National Assembly for Wales or Members of the Northern Ireland Assembly. or of the devolved Executives of those nations. Not one mention was made of those views by the Minister, by Labour Members, by Conservative Members or by Liberal Democrats.

People in Scotland in particular will be astounded that only days after a Council of Ministers meeting on the vital issue of fishing, in which there was a controversial U-turn by Commissioner Franz Fischler on a quota system for the deep-water fisheries to the west of Scotland, the matter has not been mentioned in a debate in a House in which Government and Opposition Members from Unionist parties declare that the interests of Scotland, Wales and Northern Ireland are taken seriously. They are not, and the absence of such matters from the debate is proof of that.

I want to touch on the main issues on the agenda for Seville: the EU convention, immigration, the reform of the European Council and enlargement.

First, on the convention, I start by expressing my appreciation of the work of the only two directly elected Scottish representatives on the convention—Professor Sir Neil McCormick MEP and councillor Keith Brown, both of whom represent my party. I also praise the work of the hon. Member for Birmingham, Edgbaston (Ms Stuart), who has taken seriously her role of representing the interests of the House and all its Members. I look forward to continuing discussions with her. I have not yet been approached by the other representative of the House to share any thoughts. The Front Bench of the Conservative party described him as a party nominee—but I hope that is not the approach that he takes to his work.

I am interested in and excited by the role of the convention. It is supposed to listen and to draft new processes in an effort to democratise the decision-making structures of the European Union. I welcome that. We should follow the watchwords adopted by members of the convention, whose task has been laid down by the Governments of the EU: democracy, accountability, transparency and subsidiarity. The UK Government and the devolved Administrations should be leading by example, but the reality is very different.

Let us consider the reality of democracy. The devolved nations in the UK are not directly represented in the convention, unlike the German Länder, which are. The reality of the involvement of Ministers from the devolved Administrations at Council of Ministers meetings is that they attend only a fraction of those meetings, despite the fact that they are elected to represent—

The Minister for Europe (Peter Hain)

I must intervene to correct the hon. Gentleman. The Länder are not represented in the convention. No regions are directly represented.

Angus Robertson

I am grateful for the Minister's intervention. I am certain that he understands that one of the representatives from the upper House of the German Parliament is a representative of a German Land, because the upper House of the German Parliament is made up of the representatives of the German Länder. Ergo the Länder are represented directly in the convention.

With regard to the involvement of Ministers from the various devolved Administrations in the Council of Ministers discussions, I referred earlier to the meeting of the Fisheries Council, which is vital to Scotland. I have the agenda and the attendance list, from which I see that the UK Under-Secretary of State for Environment, Food and Rural Affairs, the hon. Member for Scunthorpe (Mr. Morley), was present this week, but the Scottish Minister with responsibility for agriculture—the Minister for Environment and Rural Development, Mr. Ross Finnie of the Liberal Democrats—was not.

Similarly, the statistics for recent ministerial meetings on justice and home affairs, which are vital to Scotland, with its own legal system, show that since devolution the leader of the Liberal Democrats in Scotland, who is responsible for the Justice portfolio, the Deputy First Minister, Jim Wallace, has attended only four out of 19 meetings.

The reality of democratic representation leaves a lot to be desired. If hon. Members do not take my word for it, they should listen to the recent comments of the Scottish Labour Member of the European Parliament, Mr. Bill Miller, who I understand has a pretty senior role in the party of European Socialists. He described the efforts of the Scottish Executive in the European Union as being "virtually zilch". On the democratic element of the agenda set by the convention, much is left to be desired.

On accountability, it is astounding that not one UK Minister from any Department has ever given pre-Council or post-Council evidence to the European Committee of the Scottish Parliament—or, to my knowledge, to the National Assembly for Wales or to the Northern Ireland Assembly.

It is also a fact that paperwork giving notice of Council of Ministers meetings is not forwarded regularly by the various UK Government Departments to the Scottish Executive. That was confirmed in the recent report to the European Scrutiny Committee. Hon. Members who have not picked up on the minutiae of that may find it rather amusing that the letter from DEFRA confirming that it has not been forwarding letters to the devolved Administrations states: It would seem sensible to do so and I would therefore be grateful if you could supply a contact name for each of the following:

• the Scottish Executive
• the Scottish Parliament
• the Scottish Parliament's Library
• the National Assembly for Wales
• the Northern Ireland Executive
• the Northern Ireland Assembly".

The devolved Administrations have not even been receiving the relevant paperwork. That is in breach of the concordats, which state that information should be exchanged. It is also, incidentally, in direct contradiction to written answers that I have received from the relevant Government Departments, which claimed to me that all relevant information is passed on, whereas the reality is very different.

The reality of transparency—another of the key issues that the convention is following—also leaves a lot to be desired in the context of the devolved institutions in the UK. How is transparency served when, for example, Scottish Executive Ministers claim that they have been at meetings when they have not? Again, Mr. Finnie from the Liberal Democrats claimed to be at a key meeting, then the Scottish Executive was forced to "clarify the situation". There had been an administrative error and he had not been at the meeting as claimed.

How transparent is it that the Scottish Executive falsely tried to hike its attendance statistics in a parliamentary answer to the Scottish Parliament? It had to do a U-turn on that as well, and admit its appalling track record by confirming a lesser figure. All that can be read in the Official Report of the Scottish Parliament. It might interest Conservative Members that the attendance record of Scottish Executive Ministers from the Labour party and the Liberal Democrats is now even worse than it was under the Conservative party pre-devolution.

It is interesting that the issue of representation at Council of Ministers meetings was raised at First Minister's questions in Aberdeen recently. First Minister Jack McConnell claimed to MSPs that Scottish Ministers have led Fisheries Council meetings, although they never have. He was forced to make a U-turn to explain that Scottish Ministers have never led any Council of Ministers meeting when the Scottish interest is overwhelming within the UK.

In relation to transparency, it is also interesting that European policy making in the UK is governed by concordats that seek to maintain confidentiality—known to most people as secrecy—at a time when Ministers are advocating that we should open up the proceedings of the Council of Ministers, which I fully endorse. However, when information is sought about how policy is formed between the various Governments in the United Kingdom, they say that that is unnecessary.

Mr. Wiggin

I recognise how meticulous the hon. Gentleman is in his research. With all the claims about people being at meetings at which they were not present, especially with regard to the parties that he mentioned, does he know whether any expenses claims have been submitted? Perhaps he has researched that matter as well.

Angus Robertson

Unfortunately I must disappoint the hon. Gentleman, as I have not pursued that issue, although he might wish to do so. I do not want to cast aspersions on Scottish Executive Ministers about the expenses involved in Brussels trips, as I am more concerned about the political claims that they make about turning up and standing up for Scotland when they do not even bother to be present. Incidentally, they skive off 90 per cent. of meetings of the Council of Ministers, too.

On transparency, it was interesting to hear the Foreign Secretary say that he welcomed the conclusion of the recent European Scrutiny Committee report. He may want to reread the report; if he does so, he will note that the Committee is in favour of changing the rules on confidentiality with regard to interaction between the various levels of government in the UK.

The four key issues that are to be pursued at the convention also include subsidiarity. As I said, the reality in the UK is that 90 per cent. of Council of Ministers meetings are not attended by the democratically elected Ministers of Scotland. The statistics are even worse for Wales and Northern Ireland. Similarly, it is beyond me to understand what sort of ambition the First Minister, Mr. Jack McConnell—no doubt he is supported vigorously by the UK Government—has with regard to the acceptance of the idea that any eventual subsidiarity watchdog might have fewer representatives than there are member states of the European Union. Of course, that would preclude direct representation of interests from Scotland, Wales and Northern Ireland.

I do not know whether there are any Members in the Chamber from Wales—[Interruption.] I must clarify for the Minister the fact that I meant Back Benchers. Perhaps he can explain the very strange decision to close the Welsh representation office in Brussels without any consultation. While every other part of Europe is opening offices willy-nilly to pursue and fight the good fight for the interests of Scotland, Catalonia or wherever else, Wales is suddenly not to have any such representation. I do not know why the Labour-Lib Dem Administration in Wales has decided in favour of that proposal.

Mike Gapes

As the hon. Gentleman is so interested in Wales, can he tell us where his friends from Plaid Cymru are?

Angus Robertson

I am grateful to the hon. Gentleman for raising that issue. First, he must understand that I am speaking on behalf of the Scottish National party and Plaid Cymru. My colleague who speaks for Plaid Cymru on these issues is currently in a meeting dealing with objective 1 status for Wales. There is, of course, a question about whether the UK Government are going to include in the next comprehensive spending review a budget line to cover the match funding for objective 1 in Wales. Perhaps the Minister, with his Welsh interests, will be able to confirm to the hon. Gentleman that a specific budget line for match funding for objective 1 will be included.

Peter Hain

As the hon. Gentleman has taken an interest in Wales, let me reassure him that every nationalist attack on this Government in respect of objective 1 funding has been shown to be untrue. The nationalists said that we would not get the funding, and we did; they said that we would not get requisite funding and resources from the Treasury, and we did; and they said that we would not get match funding, and we did. All their allegations have proved to be unfounded, as his is now.

Angus Robertson

In that case, I await the announcement on the budget line in the comprehensive spending review, as will all the people in Wales. We do not have long to wait. Following the Minister's intervention, and as he is a member of the convention's working group on subsidiarity, I look forward to hearing for the first time from the Government about how the interests of Scotland, Wales and Northern Ireland will be pursued in the convention. I would also be interested to hear whether the UK Government will support the European Committee of the Scottish Parliament, which has a Labour majority, in favouring the idea of devolved Administrations and Parliaments with a legislative status having partnership status with the Commission. I am interested in whether the Minister and the UK Government will battle for the interests of Scotland, Wales and Northern Ireland. Call me cynical, but I do not think they will.

I know that many other hon. Members wish to contribute, but I should like very briefly to mention a number of other important points. Clearly, immigration has been creeping up the agenda at home and on the continent, despite the fact—it is not repeated enough—that the total number of asylum seekers now is only half what it was in 1992. I agree wholeheartedly with the right hon. Member for Hartlepool (Mr. Mandelson) that we need an effective common European policy. I take the subject seriously because of personal experience—my mother came to this island as a refugee after the war. Scotland, of course, is a country of immigration and has benefited for centuries from immigrants, particularly from Ireland, England, the Asian sub-continent, eastern Europe and elsewhere.

I am concerned about the rise of the far right of Pim Fortuyn and Jörg Haider. In Germany there are serious worries about the so-called "Haiderung" of the Liberal Democrats' sister party, the Free Democrats, and, indeed, Edmund Stoiber's CSU, which campaigned under the slogan "Kinder statt Inder"—children instead of Indians. That should be of concern to hon. Members, especially as German opinion polls put the CDU/CSU in pole position ahead of the SPD.

We are anxious about the role played by certain parts of the media in relation to immigration. A recent MORI poll showed that respondents believed that the UK hosts 23 per cent. of the world's asylum seekers and refugees, which proves that perceptions have been massively skewed. We must appreciate that a number of newspapers have been grossly irresponsible in their coverage of the subject.

I was pleased that when the Scottish National party recently commissioned a poll by Systems 3, the main polling organisation in Scotland, to establish the key perceptions of people in Scotland about immigration and asylum seeking, it found that a massive majority of Scots reject racist attitudes and believe that all people in Scotland should have equal rights and fair treatment, regardless of their colour, creed or country of origin. Similarly, Scots believe that incomers make a positive contribution to Scottish society. By an even greater margin—nearly three to one—Scots oppose the deportation of incomers living in Scotland.

We have a declining population because successive Labour and Conservative Governments managed to put our economy into relative decline, so it is essential that we welcome people from elsewhere who bring with them skills, energy and immense commitment. Before I entered the House, I reported for the BBC from Austria and saw at first hand the dangers of populism and media hysteria about immigration. We should take every opportunity to tackle extremism head on, and find sensible and humane solutions to the challenges and opportunities of immigration.

I shall conclude now, because other Members wish to speak. I wish the Government well in seeking an appropriate conclusion to the Seville summit. I firmly support measures to reform the EU, make it more effective, help it to remain confederal, and ensure that it is closer to the people. We need a Europe of nations and nation states. Unlike some Members of Parliament, I believe that Scotland is a nation. To secure democracy, accountability, transparency and subsidiarity, the best answer for Scotland is independence in Europe.

8.48 pm

Mike Gapes (Ilford, South)

Our debate is taking place at an interesting time. I want to go back to the debates that were going on just before the countries that joined the single currency did so. As a member of the Select Committee on Foreign Affairs in the Parliament before last, I went to Portugal and had discussions about whether the Portuguese economy would be sufficiently robust for it to join the euro. There was a general view in the British media and among Conservative Members that that would be impossible for Portugal. Yet the Portuguese joined the euro and the Portuguese economy is a success within it. We saw stories saying that the launch of the single currency would be a failure, but on 1 January this year, in notes and coins, it was a success. The process went very smoothly. After a long period in which the euro fell against the dollar, five months later it is going the other way, and the budget deficit in the American economy may lead to serious long-term problems.

Of course, the Eurosceptic press—the Murdoch and Conrad Black newspapers—will want to run stories about the euro saying that all is doom and gloom and that it will fail. Unfortunately, some hon. Members also push a doom-laden scenario. Most of them sit on the Conservative Benches, but I regret to say that some are Labour Members—they are not here at the moment, so unfortunately they cannot hear me. I welcome my hon. Friend the Member for Luton, North (Mr. Hopkins) to the Chamber. I am referring to him, among others, so it is important that he hears what I have to say. They believe that the economy will collapse, the euro will disintegrate, and all its member countries will leave it. That is nonsense. The single currency will generate economic growth and expand trade and company relationships: eventually that economy will be the dynamic for 400 million people in our continent.

An enlargement process is taking place. If several new members join the European Union in four or five years' time, they will all join the euro, and the single currency will extend from the Baltic down to the Mediterranean. In a decade or 15 years' time, it may reach all the way across to the borders of Russia and Ukraine. We in this country are living in cloud cuckoo land if we think that we will not be affected by that process. Unfortunately, there is an element of wishful thinking on the part of my hon. Friend and others.

Mr. Hopkins

I think that the wishful thinking is all on my hon. Friend's side. He has a passionate belief in something that he wants to happen. My argument is that the arrangement is inherently deflationary and is causing problems and stresses between members of the eurozone, which are doing less well than those outside it.

Mike Gapes

My hon. Friend missed my earlier remarks. I shall not repeat them, but I suggest that he read tomorrow's Hansard.

We live in a global economy with three large currency blocs, and countries that are left outside face a real danger of speculation against their currencies. Owing to the excellent economic management of my right hon. Friend the Chancellor, we are not experiencing that problem, but throughout the past 60 years the British economy has faced all kinds of difficulties, including runs on our currency and having to borrow from other central banks. I do not wish our economy to get into that state again.

This debate is about wider questions. Reference has been made to immigration and asylum. I made two speeches on that subject last week, and I shall not repeat them now, but I want to draw attention to the fact that we in the European Union countries must recognise that there may be a downside to enlargement if we start to build robust external borders against potential applicant countries. The changes mean that we need to be especially sensitive to Bulgaria and Romania. British Customs officials are already helping Bulgarian efforts to stop smuggling. People from the Home Office and our police force are helping other countries in central and eastern Europe. Other EU countries, especially Germany, are also providing assistance. That is the way forward.

Three weeks ago, I was in Bulgaria with the NATO Parliamentary Assembly and we discussed NATO enlargement. At the end of our proceedings, we adopted a resolution that recognised the importance of sending positive signals to countries that wish to be part of the NATO defence alliance. There will be a major summit in Prague in November when six or seven new members could join. In 1999, three new members—Hungary, the Czech Republic and Poland—joined. The 19 could therefore become 26 or even more members. However, I am worried that the process is not being thought through sufficiently sensitively.

There is a danger that the United States, in its enthusiasm to push for the widest possible enlargement of NATO for political reasons, will weaken its effectiveness. That raises a fundamental issue for Europeans. We should not get into a position whereby NATO is less effective and the US can pick and choose about defence matters. We have not yet built the strong European security and defence policy that will enable us as Europeans to act without the US, if necessary.

We need a strong EU for our European interests. We have witnessed American attitudes to Kyoto, steel and the US farm Bill. We know that the compassionate conservatives across the pond tend to global unilateralism. I believe that we in Europe have to defend our global interests. That means a strong EU with this country at its political and economic heart.

8.58 pm

Mr. John Baron (Billericay)

I am pleased to be called to speak in such a good humoured and wide ranging debate. One could focus on several issues, but I want to confine my remarks to one of the EU's most serious deficiencies: the tendency of its overseas budget to be increasingly dominated by political considerations at the expense of its stated objective of relieving global poverty. An increasing amount of aid is being directed towards middle-income countries for political purposes and the poor of the world are consequently suffering.

The crime is compounded by the fact that the low-income countries need our help more than ever. Recent research shows that world inequality is increasing. According to the economist Branko Milanovic, the richest 1 per cent. of people earn more than the 60 per cent. of households at the bottom of the income distribution.

Previous research has been able to compare only the average income of countries. A more recent study shows that the gap between rich and poor countries is much greater than was previously understood. Meanwhile, the World Bank has warned, in a new study, that many developing countries are at risk of not achieving the poverty goals established by the United Nations.

In addition, we all see regular evidence on our television screens that much more needs to be done. For example, last week, the United Nations World Food Programme warned that southern Africa is facing its worst food crisis for more than a decade, with about 13 million people facing starvation. Yet, despite all this evidence that much needs to be done, the EU is increasingly turning its back on those most in need. The latest figures show that the proportion of the overseas aid package spent in low-income countries was 39 per cent. in 2000, compared with 76 per cent. in 1990 and 85 per cent. in 1980. The most recent figure represents a new low.

There is little doubt that the EU is increasingly playing petty politics with the poor of the world to foster stability in the countries surrounding its borders, rather than eliminating poverty. Why else do Asia and Latin America combined receive only 12 per cent. of the EU overseas aid package, when one third of the people living in absolute poverty live in India alone? Why else does Poland receive twice as much aid as Asia and Latin America combined? Why are the top 10 recipients all countries bordering the EU?

Despite those facts, this country allows nearly 30 per cent. of its overseas aid budget, which amounts to nearly £800 million a year, to be directed through the EU. I believe that that is very wrong. No single country can end world poverty. Only a team effort by the richer nations and the multilateral institutions can effectively tackle the problem. However, it is wrong that we are providing UK funds to bodies that do not share that objective. As a country, we should be ashamed of ourselves. Rather than trying to reform the system, however, the Government are set to increase the amount that we commit to the EU overseas aid package by more than £1 billion by 2003ߝ04. Clearly, this must be wrong, because all we are doing is committing more money to those middle-income countries bordering the EU at the expense of the low-income countries that are increasingly desperate for aid.

Surely the time has come, if only as a matter of principle, to say to the Commission, "Enough is enough. Either change your objectives and help the poor of the world or we shall ourselves increasingly commit resources to achieving that objective, using moneys gained by reducing our contribution to the overseas aid package." Britain has built up an enviable record on international aid over the years, and our aid agencies enjoy a similar reputation, yet the Government appear to be attempting to sacrifice our good name on the altar of the EU overseas aid package.

Meanwhile, despite the EU being the worst aid agency in the world—in my opinion—the only target that the Government have published in their recent White Paper on measuring the effectiveness of EU aid is set for 2006. Must we wait another four years before we can determine whether things are getting better, when it is increasingly evident that the percentage of aid given to low-income countries continues to fall? That will be another four years during which money will continue to be wasted, mismanagement persist and hundreds of thousands of lives will be needlessly lost, all because the Government refuse to take a principled stand and challenge the EU's increasing tendency to play petty politics.

One of the main priorities of politics must be the relief of poverty, wherever it exists. I am sure that Members on both sides of the House agree with that objective; it is just that we differ as to the means of achieving that goal. Yet, when dealing with one of the most powerful of tools to alleviate poverty—international aid—the Government have clearly turned their back on the poor of the world by allowing the EU to discriminate in favour of the middle-income countries.

I urge the Government to act now, before too many more lives are needlessly lost, because actions speak louder than words. I look forward to hearing the Minister's views on how the Government plan to put the situation right.

9.5 pm

Mr. Andrew Miller (Ellesmere Port and Neston)

I shall be brief, to ensure that the hon. Member for Galloway and Upper Nithsdale (Mr. Duncan), who is representing the Scottish Conservative party, can speak.

My right hon. Friend the Member for Hartlepool (Mr. Mandelson) rightly said in a pamphlet that if the EU did not exist, we would have to invent it. There are those who stick their heads in the sand and believe that globalisation will go away; similarly, others believe that globalisation can continue without our strengthening Europe. Both positions are clearly wrong. In the UK in the 1970s, the left took the view that we could isolate ourselves economically, but it is clear that that is no longer an option. From the moment at which it was possible to press a button and transfer funds across national frontiers, the world started to change. In that regard, I fundamentally disagree with my hon. Friends the Members for Luton, North (Mr. Hopkins) and for Glasgow, Pollok (Mr. Davidson), who are adopting a pre-1980s, rather than a post-1980s, position.

Mr. Menzies Campbell (North-East Fife)

Will the hon. Gentleman give way?

Mr. Miller

No, I cannot because of the time. The debate that is taking place within Europe concerns not a desire to destroy cultural heritage, but a desire to create a vehicle that benefits its nation states within an increasingly globalised economy.

The tenor of the remarks of those who are against the euro merely exacerbates the problems that we face. As has already been said, it seems inevitable that a eurozone will stretch across Europe. The fanciful belief exists that we could isolate ourselves from it, but such a mechanism would be impossible to sustain as major currency zones become stronger. It would be interesting to hear parliamentary debates in a couple of generations' time—although none of us will be able to hear them—on the next phases in the evolution of currency structures. Debates such as this with be looked back on with a degree of amusement. Although the economic structures of nation states will increasingly converge, culture, history and language will be protected.

On the sad day of 11 September, I was in Tallinn, meeting colleagues from across Europe to discuss a parliamentary information technology project. We were stunned by the unfolding news, but there was a tremendous spirit of comradeship. We recognised that developments in Europe, at least, are taking us forward, strengthening the political basis on which we operate, and driving away some of the terrible history of Europe. That is an important dimension, but in expanding Europe and wholeheartedly welcoming new member countries as quickly as possible, we need not turn our backs on our transatlantic relationship, or our relationship with the rest of the Commonwealth. To do so would not be the way forward. We need to embrace, and indeed strengthen, all aspects of those older relationships as far as possible.

There will be vigorous competition, as our current relationship with the United States demonstrates. In respect of matters such as steel, America is perhaps adopting an unreasonable position. It is clear that we can envisage a better working relationship with our European partners that seeks to avoid such problems.

In the longer term, as the globalisation of the economy continues, structures will need to change. The current expansion programme in Europe, which is supported by Labour and the Liberal Democrats—I am never too sure about the Conservatives' position—will present us with some significant problems. It would be foolish to disregard the significance of the CAP, which must be resolved. However, that must not be used to block expansion. It is clear from my discussions with aspirant member countries that they understand that the CAP must be reformed. Similarly, discussion has taken place about immigration and crime.

It was fascinating to hear one contribution from a Conservative Member that supported the notion of cross-border co-operation to fight crime. As I remember, the Conservatives voted against measures intended to bring that co-operation about.

The complexity of the issues is no excuse for preventing expansion or ducking the issue of the currency. That complexity, however, underlines the need for change in some of Europe's institutions. That is why I am strongly in favour of the reform agenda promoted by my right hon. Friend the Prime Minister. It is important that we carry people with us by improving transparency and accountability, while at the same time taking the logical approach—which reflects the nature of Europe—of protecting the national Parliaments as the sovereign bodies within a Europe of nation states.

I am keen to see that happen, and that is the principled position on which the British electorate want us to go forward. It is not inward looking. It would protect the great institutions we have at the same time as embracing all the benefits of expansion and taking account of the increasing globalisation of the economy. I know that the argument will continue, but—as other hon. Members have said—we must present it in a mature way to the British people in the months to come. We have to debate some incredibly important issues, not least of which is the recognition that the nirvana that my hon. Friend the Member for Luton, North seeks is impossible, given the nature of the present economic structures of the planet.

9.13 pm

Mr. Peter Duncan (Galloway and Upper Nithsdale)

I thank those hon. Members who have truncated their remarks to allow me to contribute to the debate. The right hon. Member for Hartlepool (Mr. Mandelson) suggested that this was a decisive moment in European affairs, and it is appropriate that we are having this debate today.

The future of Europe is not only being discussed at an international level. Contrary to other remarks made tonight, I find that it is regularly the subject of strong views in my postbag, and at surgeries and markets, pubs and meetings across Galloway. It is taken as read by both sides in the debate that the EU needs to be perceived as relevant to our daily lives. The turnout at the last European election suggests that that is a real problem, with the average man in the street not motivated to vote in European polls.

My right hon. Friend the Member for Wells (Mr. Heathcoat-Amory) mentioned the democratic crisis, but that crisis is all the more surprising given the pace of change in European affairs. Europe is changing. It has become much more significant in terms of the way in which it affects our daily lives. But the United Kingdom is changing—has changed—too. I do not believe that the manner in which we interact with Europe has changed to reflect the devolution settlements with Scotland, Wales and Northern Ireland. The fact that it has not changed has only served to increase lack of interest in a European institution that continues to be viewed as disconnected from the domestic political scene.

A specific aspect of that distancing concerns me today. In 1999, devolution created a Scottish Parliament with executive powers over a substantial list of policy areas. The settled will of the Scots gave responsibility for education policy—along with health, law and order and many other policies—to a Scottish ministerial team in the Scottish Parliament. Although my party and I were the sole dissenting voices, we accept the decision, and I now believe that the Government must be persuaded to proceed on the basis of its implications—and those implications include our dealings with Europe.

Currently, United Kingdom delegations to EU decision-making bodies and working groups are formed in Whitehall, irrespective of the policy being made in Scotland. I understand that Ministers and officials from the Scottish Executive are often invited to join such delegations, but in this instance "often" is surely not good enough. I feel that when Europe is discussing devolved matters the devolved Administrations should be involved in the UK team as of right.

To date, the Government's record has been patchy to say the least. It has not been lost on the Scottish public that the party which delivered devolution for Scotland seems once more reluctant to recognise its implications fully. The Government will insist that they have consulted the Administrations regularly—[Interruption.] I urge Ministers to wait for my conclusions.

The current arrangement whereby a party shares power in Holyrood while holding it in Westminster cannot be expected to last for ever. Indeed, a change at both ends is long overdue. The only practical solution is for the Scottish Executive to be involved, as of right, in the UK group contributing to European policy debate on devolved issues.

While advocating a stronger voice for Scotland within the parameters of the United Kingdom, I abhor the notion of "a Europe of the regions". That soundbite is the objective of many, simply because it subsumes the very nation states to which we belong. I have little doubt that the regional government agenda of the present Administration is intended to further the plan within the UK in preparation for a greater future role for the regions in Europe.

That is the Government's agenda. It is not mine or that of the official Opposition. In the Europe of the future, the nation state can and must remain supreme. Only through the continuance of the nation state as the building block of Europe can we recognise the imbalances that may have developed, and seek redress in years to come. Anything else will lead to a lack of clarity and create national resentment.

In Scotland, for example, we have continued to suffer significant losses in our most vulnerable communities through the malfunctioning of the common fisheries policy. As Members will know, that is causing resentment. The CFP highlights the great divergence that is often experienced between good intentions and the reality of EU political interference. Scotland accounts for more than 70 per cent. of the UK fishing fleet, and has experienced a similar proportion of the devastation following falling fish stocks. The CFP's ambition is ensuring rational and sustainable exploitation of fish stocks through conservation and management policies designed to protect resources and reflect the needs of the fishing industry". In fact, we have seen the opposite.

As a result of the politics of failure in Brussels, more than 50 per cent. of CFP support has gone to one nation—pain—while 1.1 billion euro of financial support per annum has failed to preserve stocks. That is the kind of politically driven madness that gives the European Union such a poor reputation for delivering for its members through such programmes.

I recently returned from a visit to Denmark, another country that has suffered greatly from structural changes in fishing. During my visit, I was made very much aware of the Danes' eagerness to progress reform in the crucial areas where the EU at present is failing. I wish the country well when it accedes to the presidency in July, and urge it to deal with the real issues that stand in the way of Europe delivering for its member states.

That task is to become even more onerous with the onset of enlargement, which the Danes are desperate to have moved to the top of the agenda. I am happy for it to be there, as enlargement will nail once and for all the mirage of a one-speed Europe. Before and after expansion, flexibility should be our watchword, allowing each nation to reap the benefits of free trade without being bound up by the political agenda.

In short, the EU has the power to add massively to our economic well-being. It has done so in the past, and will do so again. If flexibility remains at the forefront of our debate on the future of Europe, I for one will be its strongest advocate, as I will for Scotland's place at the UK's table in Brussels.

9.21 pm

Mr. Richard Spring (West Suffolk)

On the brink of enlargement, all being well, the EU is faced with great opportunities, and with its greatest dangers for a generation. It can aim to make itself, in the words of Romano Prodi, an "advanced supranational democracy", or it can strive to be a Europe of nation states in a single market working together to promote peace and prosperity in Europe. It is clear from recent elections what the people of Europe want, and we ignore our people at our peril.

The EU will never become a real force for improvement in all our societies until the democratic deficit is dealt with, as many hon. Members have noted today. This Government have failed to deal with the matter in any substantive way. Their policy so far has been marked by a rudderless drift towards a more centralised Europe. Their concrete ideas have been few and far between. One such has been the Prime Minister's absurd idea of a second chamber for the European Parliament. It has been roundly dismissed by every commentator and most politicians on the continent of Europe.

The next big thing, which the Minister for Europe has been touting for the Prime Minister, is this idea of a president of the European Council. That person is supposed to give Europe a single voice, especially on foreign policy. The president would have to be a remarkable man—or woman—because we have seen how hard it has been for Europe to find a single voice on foreign policy in any formalised sense, whether on the war against terrorism in Afghanistan, or on the middle east. Of course it is important, from time to time, to coalesce with a joint viewpoint and approach, but that is quite different.

Above all, this British Government do little to deal with the lack of democracy and accountability in the European Union's institutions. In too many elections on the continent, we have seen extremist parties coming forward in response to that. Those parties have different causes and reasons in different countries, but they are united by a sense that people's voices are not being listened to, and that the governors are becoming more distant from the governed.

The solution cannot be to create what Romano Prodi called an "advanced supranational democracy". The desire to build such an entity is a sad sign that some in the European Union do not want to listen to the loud popular voices that are calling for societies where power comes from the bottom up, where the rulers must respond to popular concerns. The Commission is clearly still stuck in a time warp of idealistic thinking, frozen in the 1950s. This has little to do with the problems and needs of Europe today.

We are all familiar with the Government's wish to make Europe a superpower, as the Prime Minister has said, but we have yet to hear anything from the Government on how such a plan is realisable. It is natural that different nations will have different views about what their interests might be and about the values that they consider to be most important to promote abroad. It is only when we have calls for "more Europe" in foreign and security policy that it becomes a problem. The unavoidable logic leads either to the imposition of some member states' foreign policy on others or a subjection to the lowest common denominator. Of course it is to our advantage for the nations of Europe to combine their foreign policies from time to time when they wish, but that is not something to be forced. These grand dreams do nothing to promote a Europe that responds to today's needs.

The European Union should, above all, be an engine for its people's prosperity. That has to he the priority, and it was its original purpose. The Government have talked a lot about this; we have heard a great deal about getting Europe to embrace the enterprise agenda, making it the most dynamic economic region in the world. The Lisbon agenda has been in action for more than two years and yet it has let down Europe's businesses and workers.

We heard how, at Stockholm last year, the Prime Minister was delivering economic reform in Europe and jobs in Britain. Yet three months ago he was forced to admit to the House that at Stockholm, progress stalled. That was quite a climbdown from the talk about that Council's "good news".

Sadly, the Government have not lived up to their promises where it matters most and are failing to deliver. Let us look at some of the targets set at Lisbon to see what has become of them. In his statement to the House after the Lisbon council, the Prime Minister told us that all government was to be done fully online by 2003. I tried to find out what progress had been made in reaching the target but was told in a written answer that the information was not held centrally. So the Government are clearly up to date on that one.

We heard about the need to increase the amount of electronic commerce conducted in Europe and Britain, but in answer to a written question I was told that the Government have no means of measuring that amount. There was a target to halve youth unemployment in Europe by 2010. Since then, youth unemployment has fallen by 1 per cent—progress, I grant the Minister, but very modest. There was a target to allow electronic access to all the main public services by 2003. We learn that slightly more than half of those services are e-enabled. Some progress has been made, but I will be interested to hear whether the Minister can guarantee that the target will be met on time. It is crucial that the spirit of Lisbon becomes a reality. So far, the Government have not persuaded our partners to deliver.

In reality, the Government's achievements have fallen far behind their claims and ambitions. The people of Britain want less hot air about Europe being a superpower but real delivery to make the European Union a catalyst in the creation of jobs and wealth for its people.

The second great challenge and purpose that Europe faces is to make enlargement a success. We cannot afford to jeopardise this great task, upon which the future prosperity of eastern Europe and important opportunities for British business rest. One obstacle, of course, has been the Nice treaty. We told the Government repeatedly before the treaty was signed that it would likely be more about integration than preparing Europe for enlargement. We have been proved right, because the Irish people recognised that the treaty, inter alia, would take more from their sovereignty than they were prepared to give. They rejected it and may, despite the pressure put on them, reject it again. If so, we would need a new accession treaty ready for the candidate countries. It should contain those parts of the Nice treaty that are needed for enlargement, which we have happily acknowledged and accepted. A short, simple treaty is needed and the Government must actively work towards putting together a plan B if a second Irish referendum rejects the Nice treaty. Anything less is ostrich-like behaviour and absolutely wrong. It would be a tragedy if enlargement were imperilled because of the unnecessary baggage attached to the Nice treaty.

The Government continue to have an out-of-date geopolitical agenda. Once upon a time, the Labour party refused to face up to the challenges of the communist era. Absurdly, it abandoned its policy of unilateral disarmament only as the cold war ended. Labour is behind the times again today. It appears to subscribe to a new type of Europe that is increasingly out of favour. People do not want monoliths imposed upon them any more—they want institutions that work from the bottom up, not ones that dictate to them.

The right hon. Member for Hartlepool (Mr. Mandelson) mentioned several issues that are wholly pertinent to the future of Europe; for example, reform of the common agricultural policy—a point taken up by the hon. Member for Tweeddale, Ettrick and Lauderdale (Mr. Moore). The right hon. Gentleman referred to the economic tests for the euro, although I suggest that only one test is relevant to the Government—whether they can win a referendum.

The right hon. Gentleman gave an accurate warning against any form of anti-Americanism, and pointed out the importance of co-operation between Europe and the United States. Many of us will disagree with some parts of the right hon. Gentleman's speech, but it is well worth reading for its view of Europe and our relationship with the rest of the world.

The hon. Member for Tweeddale, Ettrick and Lauderdale correctly said that over the past few months—and indeed the past few years—the Government have posed questions about the future of Europe but provided no answers.

I congratulate the hon. Member for Birmingham, Edgbaston (Ms Stuart) on her role as a representative of the House of Commons and wish her well. She said that the convention had broad terms of reference. We thought it rather odd, however, that the chairman of the convention—who should be disinterested as he has an important role—was advocating the establishment of an EU diplomatic service and EU embassies. That seems a curious dichotomy. I hope that the hon. Lady agrees that there seems to be some clash in that regard. None the less, we support her in the view that the EU must be made to be successful. I hope that the convention will play an important part.

My right hon. Friend the Member for Wells (Mr. Heathcoat-Amory) talked of opacity in the European Union and about the old-fashioned, statist character of the EU. He is wholly correct. Lack of transparency has helped to cause so much of the alienation of the peoples of Europe from EU institutions. My right hon. Friend referred to the hideous weight of the acquis communautaire. All those things must be dealt with for people to reconnect and for the convention to be successful.

The hon. Member for Glasgow, Pollok (Mr. Davidson) gave his views on the euro. It is significant that there are differences of view throughout the party political spectrum, although the only one that he suggested is that he has been subjected to abuse for holding his views.

My hon. Friend the Member for North Dorset (Mr. Walter) said that political elites should no longer have the power that they currently hold in the EU. He also spoke of the effects of the CAP on enlargement.

The hon. Member for Leicester, East (Mr. Vaz) referred to the reform agenda. He, too, spoke about enlargement. It was a great pleasure to hear from him again. I remind him of our warnings during the preparation for Nice about everything that could go wrong—the impact of enlargement, putting baggage on the treaty that should not have been there. That is exactly what happened in practice and the consequences are there for everybody to see.

We heard an excellent speech from my hon. Friend the Member for Boston and Skegness (Mr. Simmonds). He talked about the global overview and spoke of the lessons of 11 September—the need for flexibility in a military response.

The hon. Member for Luton, North (Mr. Hopkins) talked about the importance of retaining our currency. He also referred to statistics showing that Britain was doing well despite not being a member of the eurozone.

A point made in the contribution of the hon. Member for Moray (Angus Robertson) was taken up by my hon. Friend the Member for Galloway and Upper Nithsdale (Mr. Duncan): how we relate the devolved constitutional architecture of the United Kingdom to the institutions and practices of the European Union. We need to address that.

We heard a contribution from the hon. Member for Ilford, South (Mike Gapes). I point out to him that the euro will do well only if the underlying economies of Europe do well. That depends on low taxation, deregulation and a proper competitive environment.

My hon. Friend the Member for Billericay (Mr. Baron) was right to talk about the imperfections in EU aid policy, which have been widely discussed throughout the European Union.

Since the second world war we have seen the world move on—to echo the words of the hon. Member for Birmingham, Edgbaston. It was a perfectly legitimate and admirable desire among Europe's leaders to create a community that would prevent war from ever happening again. In that respect, there is no doubt that the Community has been particularly successful, but we have now moved on to a point where those old-fashioned blocs, which were relevant before, are no longer relevant in the 21st century.

There is a lively debate about the future of the architecture of the EU. My right hon. Friend the shadow Foreign Secretary and I have had numerous meetings to discuss that point with politicians, diplomats and other opinion formers from all over the EU and the accession countries. Happily, more and more of our sister parties are taking over as the governing parties in Europe. They, too, reject in many instances the corporatist, statist, high taxation and interventionist culture that has so damaged the EU's economic performance.

To enjoy public acceptance, the EU will need to find radical ways to decentralise authority and to reinforce our national Parliaments. It is absolutely crucial to have a finality of competencies at the centre of our EU structures, to assure people that the remorseless process of integration and harmonisation will be arrested and that what is done at the remote centre, which is so unaccountable, will be minimised. That is hugely important for the convention to consider and for the IGC in 2004 to address; otherwise people will simply not feel comfortable with the relationship with the EU.

The Conservative party has already produced many constructive proposals to deal with the democratic deficit and the need for economic liberalisation and reform, but there is clearly much more to do. However, we are at a crossroads. Everything points to a new European architecture that is flexible, open and more transparent. Nothing that we have heard today from the Government thus far in any way goes to the heart of those matters. Just as the Government while in opposition failed to face up to the great geopolitical challenge of the cold war, today they are frozen in a mindset of Europe utterly unsuited to the challenges of the 21st century.

9.37 pm

The Minister for Europe (Peter Hain)

I always enjoy following the hon. Member for West Suffolk (Mr. Spring). I attribute his great fluency and charm to the fact that he was educated at the university of Cape Town. I agree with at least on one thing that he said. He wanted a flexible, open and transparent Europe, and I totally agree with him about that. However, I deprecate the fact that, when he refers to the Irish referendum result, he always seems to gloat and to be delighted that the result could wreck the whole enlargement process. As I have reminded Conservative Members before, the candidate countries know who is on their side. They know that the Labour Government back them and that the Tories try to sabotage them.

On the recent election results in Europe, the voters of Britain will remember when the next general election comes that those right-wing Governments elected in France, Denmark, Portugal and Italy have all found that their national footballs teams have been knocked out of the World cup. I am sure that that will be a key factor in the next general election campaign here in Britain.

It has been a particular pleasure to hear Conservative Members' interventions, given their uncharacteristic silence on matters European in recent months—so much so that The Independent reported on 5 June that the Leader of the Opposition was planning to take a back seat in the no campaign because of fears that his party's unpopularity would damage it.

Dominic Cummings, the Leader of the Opposition's director of strategy, memorably said: the biggest potential threat to the survival of the pound is the Conservative party. If the Conservative party were to define the anti-euro campaign and articulate its message as it has in the past, then Blair has a real opportunity to win a referendum". As Clint Eastwood said: a man's got to know his limitations". What the Tory director of strategy is saying is that Tory support is the kiss of death. Perhaps we should ask the Tories to pledge their wholehearted support to the Brazilian football team ahead of Friday's match.

The director of strategy at Conservative headquarters also commented that it is difficult for some Tories to accept—but nevertheless true—that for many people, just about the only thing less popular than the euro is the Tory party". The difference, of course, is that the euro is increasing in value and credibility, while voters have been selling shares in the Tories for a decade. Many Tories want their party to run the no campaign. One Conservative was quoted as saying: We hope it will be run by Thatcher, Tebbit and Duncan Smith I presume that the fourth horseman of the apocalypse was unavailable.

I fear that we heard nothing new in Conservatives' contributions today. We heard the same old scratchy record of suspicion rather than engagement, and the same feverish defensiveness, rather than our confidence in driving forward the agenda in Europe. Several spurious points, to which I need to reply, were made by the right hon. Member for Devizes (Mr. Ancram). He asked about the Laeken declaration and implied that it was some kind of vehicle for a superstate. He should read it. It states: Citizens want results, they do not want a superstate". I acknowledge that he said that he wanted enlargement to be on track by 2004. We want that, and we are determined to achieve it, which is why ratification of the Nice treaty by all countries of the European Union, including Ireland, is essential to keep it on track.

The right hon. Gentleman may want further elucidation on the common agricultural policy. My right hon. Friend the Foreign Secretary attended yesterday's General Affairs Council meeting, and I attended its meeting last Monday when the CAP was discussed. Our agenda and the leadership given by my right hon. Friend the Foreign Secretary secured a position whereby direct payments were not part of the policy on the agricultural chapter. That was left to be settled at the October meeting of the European Council. That would not prejudice the outcome of the mid-term review, whose initial proposals are due to be published in a few weeks' time. If some countries, including France, had ensured a reference to direct payments in the GAC conclusions, that might have prejudiced the Commission's draft proposals. That was a major achievement.

On Zimbabwe, we expect it to be on the agenda of the next GAC meeting. Indeed, my right hon. Friend the Foreign Secretary will ask for that to happen.

On common foreign and security policy, I remind the right hon. Gentleman that it is an intergovernmental matter and will remain so. I also remind him that common foreign and security policy—which he seems to deprecate and about which he seems deeply unhappy—was established under the Maastricht treaty, which the Conservative Government of which he was a member in the early 1990s introduced. The treaty was taken through the House on a three-line Whip with timetable motions all the way through. I remember that because I was speaking against it. Maastricht established the single currency, the European Union, and the objectives of a common defence policy and a European Union citizenship. It was also a treaty to advance European integration—a Conservative agenda.

Mr. Ancram

The Minister for Europe asked me to read the Laeken declaration, which I have done. I want to quote one part of it. Paragraph 2 states: The construction of a political union has begun". Will he explain what he understands by that?

Peter Hain

Yes. That is what was in the Maastricht treaty, which the right hon. Gentleman's Government introduced.

My right hon. Friend the Member for Hartlepool (Mr. Mandelson) made an eloquent, formidable and authoritative contribution describing enlargement as an historic opportunity that must not be missed. He argued wisely that the reform process that we are seeking to achieve in the convention on the future of Europe—on subsidiarity, the role of national Parliaments and the key issue of European Council reform—is absolutely critical to establishing intergovernmental control of the European agenda. That is what the reforms are about, and they include a proposal for an elected president of the European Council.

My hon. Friend the Member for Birmingham, Edgbaston (Ms Stuart) made key and important points about the role of national Parliaments. She informed the House that she is the chair of the working group on national Parliaments in the convention on the future of Europe, and that is an important recognition of the key role that she plays.

My right hon. Friend the Member for Hartlepool made a key point about Europe's future global role and its potential as a force for progressive internationalism on the world stage. I agree with him that it is punching below its weight, and it needs to punch at its full weight. It needs to be in partnership with the US, but as a progressive force that stands its ground on issues such as Kyoto and opening up world trade to poor countries. That is Europe's mission as a force for good in the world, and that requires a strong common foreign policy. My right hon. Friend made that point very well.

The hon. Member for Tweeddale, Ettrick and Lauderdale (Mr. Moore) said that there was no Government debate on the future of Europe. I have done my best to stir up apathy in six visits to the nations and regions of Britain. I have tried to carry the debate to the grass roots and to generate discussion at a much more local level. That has been quite successful, but I would not make exaggerated claims about the visits. I intend to visit the rest of the regions of Britain. There is a website seeking to involve people and everyone can contribute to another one about the convention on the future of Europe.[Interruption.] If the right hon. Member for Devizes is inviting me to his constituency, I shall give the invitation the serious consideration that it deserves.

My hon. Friend the Member for Birmingham, Edgbaston is doing an excellent job on the convention on the future of Europe and is an excellent representative of this Parliament. She is extremely influential and that should reassure us about the outcome.

I sort of enjoy working in the convention with the right hon. Member for Wells (Mr. Heathcoat-Amory), some of the time. He asked the specific question whether it was the Government's policy that the charter of fundamental rights should become legally binding. The Government's policy remains that the charter should not create new legal rights. That is imperative. The horizontal provisions negotiated by Lord Goldsmith in the convention on the charter state, in article 51: This Charter does not establish any new power or task for the Community or the Union, or modify powers and tasks defined by the Treaties. The right hon. Gentleman may have found, in talking to fellow members of the convention, that the people who say that it is a great idea to have a charter of rights do not seriously appreciate what the implications would be if it were incorporated wholesale in the treaty. I agree with him about that. My right hon. Friend the Foreign Secretary has made it absolutely clear that we shall not do that and that we shall ensure that the debate is approached in a rational fashion. For example, I pointed out to German representatives that their ban on strikes for essential workers could be overridden if the charter were imported wholesale in the treaty. They had not been aware of that point. There is a sense that people want a charter of motherhood and apple pie at one level, but are not willing to recognise what full incorporation would signify.

Mr. Spring

We warned at the time of the Nice treaty that it would have an application in terms of our law. That view was confirmed by the Commission at the time. I remind the Minister that I tabled a question about how the charter had been cited in the European Court of Justice and in the Advocate General's opinions or judge's decisions. The Minister replied: Providing the full list would incur disproportionate cost"—[Official Report, 24 January 2002; Vol. 378, c. 1000W.] However, he then cited a number of instances when the charter had been mentioned. The idea that it has no relevance to judicial processes now and in the future in this country is absurd.

Peter Hain

There is a good answer to that. The hon. Gentleman should be well aware of it. If he wants me to spell it out again in detail in writing, I will happily do so.

I agree with the right hon. Member for Wells that we need a reverse gear as well as a forward gear. Indeed, part of the debate is about how we build that in to any new settlement to come out of the convention. In respect of the Irish referendum, he well knows that the Government of Ireland have asked for assurances about Irish neutrality in the event of the Nice treaty coming into force. They anticipate that the Seville Council will give those assurances, and I hope that that will enable the people of Ireland to vote yes in a second referendum. As strong pro-Europeans who have done very well out of their membership of the EU, they will not, I am sure, want to deny the benefits that they have had to other countries who wish to join.

The hon. Members for North Dorset (Mr. Walter), for Galloway and Upper Nithsdale (Mr. Duncan) and for Boston and Skegness (Mr. Simmonds) spoke with their usual conviction on European matters. I like the hon. Member for Moray (Angus Robertson), and he speaks with eloquence, but he gave his usual Scottish nationalist rant on Europe. He did not say anything about the substance of the issues; he just peddles the same old stuff. It was the usual whinge.

The hon. Gentleman was wrong on one thing. Well, he was wrong on virtually every point, but I only want to correct one thing that he said. Welsh representation in Brussels has not been closed down. The National Assembly for Wales has withdrawn from a private body with a few officers. It now wants to establish a proper office and representation, as the Scottish Executive have done. That is what has happened.

My hon. Friend the Member for Leicester, East (Mr. Vaz) spoke authoritatively on the subject. I am always slightly nervous when one of my predecessors speaks and I am expected to reply, because they probably know more than I do about Europe, especially my hon. Friend, as he was in office twice as long as I have been. I can assure him that we will continue the reform agenda.

I am supportive of his views on child abduction. I think that the Catherine Meyer case is a disgrace. Like my hon. Friend, I agree with the hon. Member for Stone (Mr. Cash), who has an honourable campaigning record on that matter. On enlargement, we think that all 10 countries will come in on time. They are making enormous progress. Bulgaria's progress in signing off 20 chapters has surpassed expectations and is impressive.

The Prime Minister's joint letter with the German Chancellor sets out about 10 to 15 separate ideas, but I suppose that that depends on how they are defined; perhaps there are 20 if we look at them differently. They are all on the table for Seville. We will have to see how the discussion goes. All but two of the ideas are fairly certain. So that is another British agenda that we expect to get adopted in Seville.

My hon. Friend the Member for Ilford, South (Mike Gapes) made a convincing speech on the euro, reminding the House that it has been an incredible success. Portugal has benefited from it. My hon. Friend answered many of the points raised from a position of principle by my hon. Friends the Members for Luton, North (Mr. Hopkins) and for Glasgow. Pollok (Mr. Davidson), although I do not disagree with them for doing that. My hon. Friend the Member for Ellesmere Port and Neston (Mr. Miller) also successfully rebutted their arguments.

My hon. Friend the Member for Ilford, South made an important point when he reminded the House that, as part of the enlargement accession process, the 10 countries that are expected to join in 2004 will be on an automatic ticket into the euro. After the anticipated Swedish referendum early next year and the subsequent Danish referendum, we could be the only country outside the single currency if the policies of the Tories' dogmatic opposition are followed. They need to bear that position of isolation in mind.

The hon. Member for Billericay (Mr. Baron) made a series of points about European aid and development assistance. There are imperfections, as the Secretary of State for International Development has forcefully explained. However, I find a contradiction in the hon. Gentleman's position. This Government have increased overseas aid and development assistance by 40 per cent. in real terms.

Mr. MacShane

Forty-five per cent.

Peter Hain

My hon. Friend adds another 5 per cent. Those increases are occurring after years of cuts by the Tories, who ratted on their obligations to the poor of the world. The European Union has its imperfections, and the Government are the first to criticise them, but in the World Trade Organisation it is the EU that has led the drive for a new trade round that will provide favourable terms of trade for the poor countries of the world, especially in Africa. I do not understand how the hon. Member for Billericay can argue his position.

Mr. Baron

Will the Minister give way?

Peter Hain

I cannot, I am afraid. I am trying to reply to all hon. Members who have spoken.

My hon. Friend the Member for Ellesmere Port and Neston made a series of valid points. I pay tribute to his work as a country liaison Member with Hungary and to his work on enlargement, which is very valuable.

The issues that we are dealing with in Seville—including asylum and immigration and Council reform—throw into sharp relief the difference between the Government's approach to Europe and the Opposition's approach. It is the difference between practical engagement to deliver what the British people want and a dogmatic anti-Europeanism that would mean turning our backs on European action even when it is clearly in our interest.

Let us take asylum and immigration. People throughout Europe want a fair deal for genuine refugees and, I remind the hon. Member for Tweeddale, Ettrick and Lauderdale, an anti-racist policy. This Government are delivering that. People want managed economic migration to fill gaps in our labour markets, and a tough approach to illegal immigration and the criminality behind much of it. A great deal of that is for national Governments to tackle domestically, but European action can and does add value.

A common asylum policy will ensure common minimum standards for the treatment of asylum seekers and will head off a self-defeating race to the bottom by member states seeking to make themselves the least attractive to asylum seekers, even the genuine ones. It will prevent asylum shopping and make those member states that asylum seekers first enter, or pass through, take responsibility for them, rather than allowing them to shovel the problem on to others.

Working together to strengthen weak points on the EU's external border will help to prevent problems like Sangatte from occurring down the line. It is not enough to wait until people are just across the channel. To be effective, we have to deal with the illegal movement of people earlier in the chain. We must use Europe's collective weight in our relations with third countries to tackle the root causes of mass migration at source and to encourage them to accept the return of failed asylum seekers.

All those actions contribute to results that the British people want. They all add value to domestic action. They are all being driven by this Government in Europe, in partnership with others. The Tories are against European competence in this area, preferring dogma to a practical response to people's concerns. Our Government operate a policy that maintains our own frontier controls but also engages with our European partners in dealing with asylum and immigration. The previous Conservative Government wanted nothing to do with the latter and could not even achieve guarantees on the former.

The Opposition say that they want a Europe of nation states. How do they go about achieving that? By peddling the myth of a superstate even though that is yesterday's news, and by saying that they will renegotiate the treaty to restore the veto and extensively repatriate powers to Britain. That is not practical politics. It does not have the remotest chance of being agreed. In the unlikely event that the Opposition ever got into a position to negotiate on this, what would they do when they failed—meekly accept defeat or withdraw from the EU? The latter is the real agenda among many of their Back Benchers.

We also want a Europe of nation states, but a very different one. We want a Europe in which nation states act nationally when their goals can best be achieved in that way, but work together—sometimes by co-operating, sometimes by pooling sovereignty—when it is in their collective interest to do so. The other difference is that we are doing something about it. The Council reform process that will begin at Seville is designed to ensure that Heads of Governments are setting the agenda in Europe and that Ministers in those Governments are transparently and effectively delivering on that agenda. As my right hon. Friend the Member for Hartlepool said, the agenda is being set not by bureaucrats but by politicians whom people elect to be in charge.

After Seville, we will be taking that and other aspects of the future of Europe agenda forward, in the convention and elsewhere. That will provide further opportunities to embed our vision of a Europe of nation states; first, by strengthening the arrangements for the presidency of the Council; secondly, by strengthening subsidiarity, the principle that Europe acts only where member states cannot adequately achieve a policy objective on their own; thirdly, by strengthening the role of national Parliaments in the European Union, perhaps by making them guardians of subsidiarity; and fourthly, by embedding more deeply the practice that when the EU needs to act, it does so as lightly as possible.

It being Ten o'clock, the motion for the Adjournment of the House lapsed, without Question put.