European Council (Hansard, 23 June 2003)

§ The Prime Minister (Mr. Tony Blair)
With permission, Mr Speaker. I shall make a statement on the European Council, which I attended in Greece on 19 and 20 June. I should like to offer my thanks to Prime Minister Simitis and the Greek Government, who have conducted an effective presidency in a particularly difficult period.
The European Council took delivery of the draft constitutional treaty prepared by the European Convention under the expert chairmanship of Valéry Giscard d'Estaing. We agreed that the draft is a good basis for starting the intergovernmental conference in October. The 10 countries joining the European Council will participate fully alongside the existing member Governments. The aim is to conclude it in time for a new treaty to be signed after 1 May next year.
The Convention sets out clearly what Europe is for, its aims and objectives, the rights of its citizens, the powers and responsibilities of its institutions and the way it takes forward its policies. It recognises expressly that what we want is a Europe of nations, not a federal superstate, and that issues to do with taxation, foreign policy, defence policy and our own British borders will remain the prerogative of our national Government and Parliament.
The draft makes clear in the very first article that the Union only has those powers that member states give it. It introduces a Chair of the European Council to prepare and follow through the European Council agenda. It will bring an end to the present system of six-monthly presidencies, which is no longer feasible in a Union of 25. It will provide a greater role for national Parliaments, which will be able to vet all new legislation and make the principle of subsidiarity work at the political level.
There are of course areas where there is continuing negotiation—for example, over enhanced co-operation, the structure of the presidency and the role of qualified majority voting—but above all the new draft treaty offers the prospect of stability in the way in which Europe works.
I should like to pay tribute to the work done by Ministers and to other hon. Members, for the contribution that they made to the work of the Convention. In addition to the Convention outcome, reflecting the work of its 200 members, Mr Giscard d'Estaing also referred to a minority report put forward in the Convention, including by the right hon. Member for Wells (Mr. Heathcoat-Amory), the representative of the Conservative party. That report would turn the existing treaties into an association of states that would replace, and dismantle, the existing European Union.
The European Council agreed a range of actions to secure our frontiers, to ensure better co-operation with third countries on migration issues and to enable us to take the action we need to deal more effectively with asylum claims. Among the issues that we discussed was one on which we have been working closely with the European Commission and the United Nations High Commissioner for Refugees. The aim is to strengthen the protection of refugees in their regions of origin so 708 that, in a crisis, it is possible to offer effective and accessible sanctuary to refugees closer to their homes. To test whether such a scheme can work, we—with the support of the Commission—proposed pilot projects, which had widespread support. While the unanimity requirement in the Council prevented the idea from being specifically endorsed, that will not prevent the pilot projects from being taken forward by a number of member states and the Commission will report back on them within the year.
The Council discussed a paper by the EU High Representative, Javier Solana, for an overall strategy in the field of foreign and security policy. He proposed a comprehensive approach to dealing with the global problems of poverty, terrorism, and weapons of mass destruction, stressing the importance of the relationship with the United States, the need to improve our military capability and the necessity, in the last resort, for preemptive military action. The Council endorsed a comprehensive plan for tackling the spread of weapons of mass destruction. This will be a particular theme of this week's EU-US summit as we take forward our joint work on curbing the export of WMD. The summit will also focus on the trade and economic agenda, especially the need for a successful meeting of the World Trade Organisation in Cancun, and foreign policy cooperation, notably in the middle east.
President Chirac and I had proposed, following the G8 summit, that the EU should match the US by contributing up to €1 billion in 2004 to the global health fund to combat HIV/AIDS, tuberculosis and malaria. Although this had majority support, some member states objected and, because of the unanimity requirement, we could not secure agreement at the Council to that sum, but we did agree that the Union would determine the extent of its contribution at the pledging conference on 16 July.
There was a strong focus at the meeting on the EU's relations with the wider world. Putting our support behind the middle east peace process, we called on Hamas and other groups to declare a ceasefire and endorsed an urgent examination of the case for wider action against Hamas fundraising. We expressed serious concern at aspects of the Iranian nuclear programme and our full support for the International Atomic Energy Agency in its effort to conduct a comprehensive examination of Iran's nuclear programme. We made it clear that the way in which Iran behaves on human rights, terrorism and the middle east peace process is crucial to the future development of EU-Iran relations.
Finally, we held a positive discussion about Iraq. The European Council affirmed the European Union's readiness to take part in the reconstruction of Iraq within the framework of UN Security Council resolution 1483. We commissioned further work on the details of the help that the EU can provide.
The Council took stock of the economic situation following the spring summit on economic reform. It set a clear agenda for action in line with the objectives, which Britain and a number of other member states have been advocating.
The Council also endorsed the appointment of Jean-Claude Trichet as the next President of the European Central Bank, in accordance with the agreement reached during the last UK presidency.
709 What is clear is that Europe at 25 nations will be very different from Europe at 15. In the coming years, Europe will expand still further to welcome Romania, Bulgaria, Turkey and possibly others. Plainly, this means that Europe must change the way it works. There are several areas in which the Convention proposes moving to qualified majority voting, including on trade in services and in the fight against terrorism, drugs and illegal immigration. We should not, however, fear every extension of qualified majority voting as hostile to Britain. In some areas, we need QMV. The only reason we have any hope of achieving reform in, for example, the common agricultural policy is that decisions in the Agriculture Council are determined by QMV. It was thanks to QMV that we opened up energy markets. If we want to drive through economic reform, liberalise markets, and break down state subsidies, then, in a Europe of 25, QMV on such issues as trade in services and mutual recognition of qualifications is essential for the British national interest. Britain needs Europe to work and, for Europe to work, it needs to change.
That is not all that will be different in a Europe of 25 or 30. The new nations joining the EU share, in many ways, the British perspective. They are firmly in favour of the transatlantic alliance. Freed from communism, they do not fear economic reform; they welcome it. Freed from subjugation by the former Soviet Union, the central and east Europeans have no intention or desire to yield up the nationhood for which they have fought so hard. It is no surprise, therefore, that the Convention so explicitly ruled out a European federal superstate.
It is not only the new members that will sign up to that vision of Europe. Increasingly, Europe knows that the focus for its economy and for its security has to be outward, not inward. The danger for Britain is that, at the very time when Europe is moving closer to the view of Europe with which we are most comfortable, and which we can advocate so well, we should lose the chance to take our proper place in Europe by fighting battles long since over, and by turning away at the very point when Europe is turning towards us.
There are real battles, of course—for example, over tax or defence—but they are battles that we can win. At this point in time, with Europe at a crucial point of evolution, this nation, Britain, has to have the confidence to stride forward in Europe, not hang back.
The next year will determine the shape of Europe of which we are a member. There will be critical alliances to be made and choices to be faced, but I have no doubt that a Europe that now stretches from Finland and the Baltic states to the shores of the Aegean sea, Cyprus and Malta is a Europe that should have, and will have, Britain at its heart.

§ Mr. Iain Duncan Smith (Chingford and Woodford Green)
I thank the Prime Minister for his statement and congratulate the Greek Government on their hard work. I welcome the recent signing of the accession treaty in Athens. I also welcome the statement of support for the middle east road map for peace.
710 There were, however, three failures arising from Thessaloniki. First, yet another European summit has passed with no commitment to, or even discussion of, real reform of the common agricultural policy, despite the Prime Minister's QMV. Secondly, the Prime Minister failed to obtain EU backing for his offshore asylum centres; his pilot projects will not hide his failure. Thirdly, we got the European constitution.
The Government have claimed that the proposed European constitution is just "a tidying-up exercise"; yet is it not the case that the constitution will set up a European president, transfer asylum and immigration policy to Brussels, establish a binding charter of fundamental rights and create an overarching constitutional settlement in which the EU can expand its powers without the approval of national Parliaments? The Government have completely understated the all-embracing nature of that constitution.
Recently, the German Foreign Minister said that the constitution is the most important treaty since the formation of the European Economic Community". At the same time, our Prime Minister says that the constitution does not involve a fundamental change to the British constitution".—[Official Report, 18 June 2003; Vol. 407, c. 352.] What nonsense! The constitution will fundamentally change the way in which every country in Europe is governed. Everybody else sees that.
The Prime Minister always talks about his red lines in the debate on the constitution, so will he tell us why they keep moving? Will he tell us why he opposed a binding charter of fundamental rights, but now accepts it; why he opposed an EU Foreign Minister, but now supports one; why he wanted to limit QMV, but now, apparently, wants even more of it; and why he rejected the need for a written EU constitution, but now embraces it?
The Laeken declaration rightly stated that the European institutions must be brought closer to its citizens". Is it not the case, however, that the constitution is top down and even more centralising?
The Prime Minister wants to hide his Government's failure by setting up a false debate about staying in the EU or leaving it. The real debate is not about staying or leaving. The Conservative party does not want Britain to leave the EU; we want to make it work. I remind the Prime Minister that he is the one who wants to make Europe a superpower—that is his policy. That is the real debate and he will do absolutely anything to avoid it.
The President of the Convention, whom the Prime Minister was lauding during his statement, said that constitutions are created by citizens and adopted by them in referendums". A growing number of European countries are committing to a referendum on the matter, and 88 per cent. of the British people say that they want a referendum. So, if the Prime Minister believes that he is doing the right thing, why does he not hold a referendum and let the British people decide?

§ The Prime Minister
First, let us deal with the common agricultural policy. The right hon. Gentleman says that it was a great failure that the policy was not dealt with at the Counci—[Interruption.] Let me deal 711 with the CAP first. The reason why we did not deal with the CAP at the European Council is simple: it would have been quite disastrous to have transferred discussion of the CAP from the Agriculture Council, where there is QMV, to the European Council, where there is unanimity.
For that very reason, everyone who was in favour of common agricultural reform asked us not to take it at the European Council, but to leave it at the Agriculture Council.
The right hon. Gentleman is right to say that other member states objected to the pilot projects and that, because of the unanimity requirement, we cannot get them through on the basis that we originally anticipated. However, because the United Nations High Commissioner for Refugees supports the projects, we are able to undertake them and the Council agreed that the European Commission should report back on those issues.
The full-time president of the Council, whom the right hon. Gentleman mentioned, is good for this country because it allows us to make sure that we have the Council with an agenda that is driven through, rather than 25 nation states having a rotating six-monthly presidency.

§ Mr. Duncan Smith
You were against it.

§ The Prime Minister
I am sorry; it was our proposal. Our proposal is to replace the rotating six-monthly president with a full-time chairman; otherwise, we will not be able to get a consistent agenda, driven by the Council—the intergovernmental body that covers all the work of Europe.
The right hon. Gentleman mentioned QMV, on which our position is that if it is in our interests, we accept it; if it is not, we do not. It is quite wrong to say that every extension of QMV is always hostile to Britain. May I simply remind him that, under the Single European Act and the Maastricht treaty, there were massive extensions of qualified majority voting, for entirely sensible reasons to do with the British national interest? Indeed, most of those on his Front Bench, though not him, voted in favour of those extensions.
The right hon. Gentleman is right to say, however, that the divide between the parties is very clear. The right hon. Member for Wells (Mr. Heathcoat-Amory) has published his alternative convention document, which the Conservatives say is very good and effective.

§ Mr. John Bercow (Buckingham)
It is first class.

§ The Prime Minister
Thank you. That is now the Conservatives' policy, but let me tell them what it says. Let us look at the document that is now being endorsed by those on the Conservative Front Bench. It says: We propose to transform the EU into a Europe of Democracies … which shall be a treaty association of free and self-governing European states". [Interruption.] Fine: they are all in agreement with that. It goes on to say: A national parliament shall have a veto on an issue it deems important. 712 So that is an end to any concept of any issue being driven through by Europe in that way. The right hon. Member for Wells may be right, he may be wrong—many Members are nodding and saying that he is right—but let us be quite clear that that is effectively redrawing Britain's membership of the European Union.
If Conservative Front Benchers endorse that policy document, their policy is wholly inconsistent with Britain's present membership of the European Union. [HON. MEMBERS: "No, it is not."] Yes, it is, and it would mean that we would have to redraw and renegotiate Britain's membership of the EU. That is now the position of the right hon. Member for Chingford and Wood Green (Mr. Duncan Smith), and it is fundamentally opposed to everything that even the Conservative party has stood for up until now.

§ Mr. Duncan Smith
What about the referendum?

§ The Prime Minister
We have already given the reasons why we do not agree with the right hon. Gentleman on the referendum, but let me just say that it is now absolutely clear what the dividing line is. There is no way that that document—signed, I think, by only eight other members of the Convention—is anything other than a plea for a new type of British membership of the EU. That is what it is, and it would mean renegotiating our membership, and that is why the dividing line between our two parties is: this side, constructive engagement in the EU; that side, withdrawal from the EU.

§ Mr. Charles Kennedy (Ross, Skye and Inverness, West)
My right hon. and hon. Friends and I certainly welcome the acceptance of the Convention's proposals in principle, and it is worth reminding ourselves that, not that many years ago, it would have been unthinkable that 15 existing member states and 10 accession countries could reach even this degree of consensus for sensible co-operation over the development of the EU.
There will be an intergovernmental conference later in the year, albeit that we do not know how long it will last, and I gather that the Government now acknowledge that there will be an opportunity for a further debate before the recess on the Convention proposals.
We obviously welcome that, but do the Government acknowledge that it would assist the House's capacity to discuss these matters in even more detail if they were to publish a White Paper outlining with more specific intent their approach to the forthcoming negotiations and their position on the relevant articles?
It was good to hear the Prime Minister make the positive case, where appropriate, for the relevant extensions to qualified majority voting and for the relevant applications of that process, and to begin to destroy some of the myths attached to that by opponents of the process.
The Government have described the proposals as they stand as a "good basis" for discussion. Surely, a dividing line must be drawn between what is a good basis for the ensuing discussion and allowing the unravelling of the basis of the Convention proposals, which is what some of the wreckers want to happen. Does the Prime Minister acknowledge the inherent dangers in that?
713 The Prime Minister mentioned the minority report that was issued by the right hon. Member for Wells (Mr. Heathcoat-Amory) and six other members of the Convention. In an article in last wee's The Wall Street Journal, the right hon. Gentleman referred to foreign and security policy and mutual solidarity, as it is described. That goes to the central issue, which the Prime Minister may want to address. The right hon. Member for Wells argued: Since this solidarity requirement will be enshrined in a constitution, it will be legally binding. Does the Prime Minister agree that it is incumbent on him, the Foreign Secretary and all those involved to make the case for a strengthened conduct of EU external relations based on the institutions of the Union, which remain emphatically intergovernmental under these processes? Does he also agree that that will provide sufficient safeguards for independent foreign policy making by member states, including any British Government coming before the House of Commons?
In that respect, the proposed Foreign Minister role is to be welcomed, as is the solidarity shown over Iran and the middle east peace process. Does the Prime Minister agree that if that solidarity could be extended to Iraq it would assist the cause against weapons of mass destruction?
The proposed intergovernmental agency for defence issues, not least research and procurement, is to be welcomed. Many a Committee of the House has examined this area, and we all know about the excessive wastage on procurement measures over the years. Equally welcome is the fact that taxation policy is to remain within the ambit of nation states, Governments and Parliaments.
On asylum, immigration and cross-border crime, not much progress seems to have been made on the first two. The Prime Minister said that the European Commission will report back on the pilot projects that did not command unanimity. What is the time scale for that report back, and what force will it have?
The whole point of a constitution for Europe is to codify the relevant levels of responsibility and competence. That should satisfy Euro-supporters and Eurosceptics alike. In the House and in the debate in Britain, we must identify and make clear the difference between reassuring those who are constructively sceptical about aspects of Europe and those diehards who can never be satisfied. The leader of the Conservative party talks about a false debate. Is it not important that for the first time we have a voluntary exit clause for EU member states, which will place an obligation on each and every political party in British politics to make it clear whether it would ever wish to avail itself of such a clause?
In so far as the Convention moves us forward towards a Europe that is more democratic, more accountable and more transparent, it is to be welcomed. As a country, only inside Europe can we continue to make that case constructively—not increasingly destructively outside it.

§ The Prime Minister
First, in relation to how we proceed from now, the issue of a White Paper is being discussed by the usual channels, and that is one possible alternative.
714 It is important to emphasise that, in a Europe of 25, it must be in our interests—except in vital sets of circumstances such as foreign policy, defence or tax—to extend QMV, without which we cannot make Europe work effectively. I agree with the right hon. Gentleman entirely about that, although it is important that we do not unravel what was seen—not always here, but certainly abroad—as essentially a good deal for Britain.
It is important to retain unanimity on the common foreign and security policy. We want Europe to develop a better and more effective common foreign and security policy, which is why, for example, we are backing France in the Congo through the EU mission, which is very important. We expect reports on the pilot projects in June 2004.
On the whole, most aspects of the Convention have been seen, elsewhere but not here, as a substantial retention of the concept—indeed, perhaps for the first time, a proper elaboration of the concept—that as Europe co-operates more it should be on the basis of nation states and not on the basis of a federal superstate.

§ Dr. Jack Cunningham (Copeland)
May I commend the important progress made at the European summit and congratulate my right hon. Friend on safeguarding so effectively Britain's important national interests? Is it not clear from the Leader of the Opposition's suggestion that agriculture reform should be taken at the summit that he is abysmally ignorant of the processes of the European Union? Will my right hon. Friend redouble his efforts to end the serious dislocation between the European Union and the United States of America? If we do not do so, summits will come and go, but in the middle east and Africa, famine, war, pestilence and death will gallop ahead unchecked.

§ The Prime Minister
First, I thank my right hon. Friend for what he says about the Agriculture Council, which is very important. Clearly, if we had to take matters related to agriculture in the full European Council, it would prevent any prospect of reform or change.
In respect of the dislocation, as he describes it, between Europe and the United States of America, some signs exist that, whatever the differences over Iraq, people are coming together, which is welcome. I hope very much that at the European Union-American summit this week we will be able to take significant steps forward again for the re-establishment of good relations. The truth is that on issues related to terrorism, weapons of mass destruction, the middle east peace process and global poverty, the EU and the US are on the same side and share the same values. Working together, we can achieve a great deal. The general mood of the Council was to make sure that we repair the transatlantic alliance and make it function effectively.

§ Mr. David Heathcoat-Amory (Wells)
The Prime Minister was rather coy about the list of red line issues that he wants removed from the draft constitution. Will he agree, however, that it is rather a long list now, including majority voting on criminal laws and procedures and on aspects of tax and foreign policy, all of which are in the present draft, as well as the compulsory co-ordination of national economic and employment policies, which he did not mention, plans 715 for a European public prosecutor, harmonisation of social security measures, and late plans for a wholesale transfer from national veto to majority voting, without any reference back to national parliaments or people? As he is now diverging from his absurd claim that this is just a tidying-up exercise, will he put in a public document where and what his red lines are? If he is so confident that he can overturn all of them, why does he not have the confidence to put the result to the British people in a referendum?

§ The Prime Minister
I have explained on many occasions why I do not believe that this is a proper subject for a referendum. I repeat once again that neither the Single European Act nor the Maastricht treaty was put to a referendum by the then Conservative Government.
In respect of the right hon. Gentleman's other points, issues remain, of course, in relation to tax administration. Let us not forget, however, that, for example, on tax, we have effectively won that battle in Europe. In respect of common foreign and security policy, we have effectively won that battle. Surely there will still be issues that we need to get right, but let us be quite clear about the situation.
There are, of course, issues that we must debate here, but the right hon. Gentleman will accept that his ideas on the Convention, which I think have been effectively agreed by his party today, would mean that Britain would become a different type of member of the European Union. That is exactly what he wants; it is a perfectly honourable position but a position of which people should be aware. We could end up effectively in a situation in which, for example, as he says, a national Parliament could effectively veto the application of any issues in its country. People might agree with that but there is no way that single market measures could be driven though in those circumstances. If we ended up with associate membership of the European Union, which he is advocating, it would effectively result in a complete change in our relationship with Europe. I think that he has the intellectual honesty to admit that and, if it is the case, it represents a fundamental dividing line between the two political parties.

§ Mr. Harry Barnes (North-East Derbyshire)
Will my right hon. Friend tell me the gains and losses, in democratic terms, of the draft treaty proposals both for United Kingdom citizens and the totality of citizens of the European Union? If his answer requires a couple of volumes by way of response, perhaps it could be placed in the Library, but a brief, taut and penetrating reply would be welcome.

§ The Prime Minister
I do not think that my answer will require a couple of volumes. The principal gains for our own involvement and that of national Parliaments, for example, will be involvement in legislation for the first time. Powers of co-decision will also be extended for the European Parliament. The basic issue is that there were those in Europe who argued that we should effectively move to some sort of federal superstate. That argument has been decisively rejected, which is why it is so important that, apart from the British Conservative party—which is, let us say, eccentric on the issue every—other country in Europe has accepted that this is indeed 716 a strike against federalism and in favour of a Europe of nations. The Conservative party might explode with indignation about that but it represents literally the only part of Europe in which that is being said.

§ Mr. Crispin Blunt (Reigate)
The Prime Minister has made it clear that the draft constitution is unacceptable in its current form, so why has he so undermined his negotiating position at the intergovernmental conference by pre-emptively ruling out a referendum?

§ The Prime Minister
Because I do not believe that that undermines our negotiating position at all. Indeed, the very reason why we have got as far as we have is that we have negotiated sensibly, built alliances and shown—as Britain does when it puts its mind to it—that in Britain we can win.

§ Denzil Davies (Llanelli)
On the common agricultural policy, my right hon. Friend reminded the House that decisions taken at the European Council require unanimity, but decisions taken at the Agriculture Ministers Council use qualified majority voting. In view of that, can he give us some hope that before long proposals for substantial reform will come from the Agriculture Ministers Council and that that will happen in good time before world trade negotiations in the autumn?

§ The Prime Minister
I think that I can give at least qualified hope on that. The Agriculture Council meets again on Wednesday. I think that it secured significant advances last week. There is every hope that we will get agreement there and, of course, it is the only place where we will get agreement precisely because QMV applies.

§ Mrs. Angela Browning (Tiverton and Honiton)
When the Prime Minister brought this Mary-Anne back through the nothing-to-declare channel at the weekend, had he spent any time discussing the British interest in terms of European fraud, accounting systems, the way in which European accounts are audited and Neil Kinnock?

§ The Prime Minister
I do not agree with some of the hon. Lady's remarks. She talks about discussing the British national interest, which is precisely what we have represented throughout. Our disagreement with her and her colleagues is that we believe that the British national interest is best served by being in Europe and inside the European Union, not by moving towards associate membership that would leave us without any influence on issues relating to fraud or anything else.

§ Mr. David Borrow (South Ribble)
Can I refer my right hon. Friend to the reconstruction of Iraq? When I visited Iraq about a week ago, I was impressed by the work of our forces to reconstruct Basra. Water and electricity supplies are better now than they were before the war, 15 schools have been refurbished, medical centres have been re-equipped, police stations are being painted and decorated, and new Iraqi police officers are being trained and are out on the streets. However, I raise with my right hon. Friend UN Security Council resolution 1483 and the EU's reaction to it. It is clear to me that if we are to make a success of reconstruction in 717 Iraq, it is no use leaving it simply to our troops and the UK taxpayer. Successful reconstruction needs a much bigger input from both the EU and aid agencies across the world.

§ The Prime Minister
First, I echo what my hon. Friend says about the contribution of British troops and, indeed, British aid workers and people from the Foreign Office and the Department for International Development. They are making a huge difference to the reconstruction of Iraq and work is proceeding. As he rightly says, many schools have reopened and many businesses and homes are being rebuilt. There is an atmosphere, whatever the difficulties, of real hope for the future.
My hon. Friend is also right in saying that 1483, the new United Nations resolution, calls on everyone to develop as secure a programme as possible in giving greater amounts of help. I hope very much that over the coming months we can get that help under way in Iraq. The prospects are extremely good if we can lever in the right expertise and change from the outside.

§ Mr. Andrew Mitchell (Sutton Coldfield)
Does the Prime Minister think that the structure of the six-monthly European jamborees has largely outlived its usefulness? If, as reported, he came home halfway through the Council to see his children, who, frankly, could complain about that? Why does he not appoint another Minister to go to the meetings, take a few notes and report back on the personalities? He could consider the Leader of the House, who has now gone plural. As Secretary of State for Wales, he might also have time, in addition to reforming the tax system, to report back to him on European junketing.

§ The Prime Minister
First, I attended the whole of the European Council. Secondly, the hon. Gentleman's idea that I should not go to the European Council but instead send someone to take notes for me is slightly strange. It would mean that 24 nations in the European Council would be represented by their Head of Government or Head of State and we would have a notetaker. That would be a really good thing for Britain, wouldn't it?

§ Mrs. Gwyneth Dunwoody (Crewe and Nantwich)
Is my right hon. Friend satisfied that the ratchet clause in the treaty will not consistently remove from national Governments their right to veto any legislation that is not in the interests of their nation?

§ The Prime Minister
It is precisely because of our concerns about the so-called passerelle clause that we believe that we need fundamental change to ensure that national Parliaments cannot be bypassed in that way. Such a thing could only be agreed by unanimity in the European Council, but I think that we need further protections for national Parliaments, too.

§ Mr. Simon Thomas (Ceredigion)
I am sure the Prime Minister will join me in welcoming the new countries into the European Union—places such as Malta, Cyprus, the Baltic states and Slovenia—to become part of something that will now be a union of member states.
718 Does he agree that that union will be characterised by member states that tend to be of a smaller size than those that joined in the past? Many of them will be the same size as Wales and Scotland and have similar economies. What did the right hon. Gentleman do in the European Council over the weekend to protect the needs of Wales and Scotland, especially with regard to their ability to gain direct access to structural funds and other funding?

§ The Prime Minister
We have protected, in so far as we possibly can, the structural funds through the deal that we secured at Berlin a few years ago, and it is important that we continue to do so. However, it is also important to recognise that this country, as a major contributor to the European Union, needs an effective and efficient way of limiting the overall budget for Europe. In respect of Wales and Scotland, I believe the procedures in place offer the best protection for their interests.

§ Mr. Kevan Jones (North Durham)
Does my right hon. Friend agree that expansion of the EU to 25 nations provides a great opportunity for British businesses, especially those in the north-east of England which rely on 78 per cent. of their exports going to the EU? Does he also agree that future business opportunities and job creation are put at risk by those who advocate either withdrawal from the EU or associate membership of it?

§ The Prime Minister
What is absolutely extraordinary is any position that says that we should renegotiate our basic terms of membership of the European Union when 10 countries that are essentially supportive of the British point of view are coming into Europe and we have a better chance of winning these debates in Europe than we have probably ever had since we became members. To end up, when we are about to create literally the single biggest economic market in the world, redrawing our essential terms of membership would be an act almost of extraordinary folly for this country. The fact that the Conservative party now takes that position says a great deal about its present state.

§ Mr. Ian Taylor (Esher and Walton)
Does the Prime Minister agree that to make the European Union work, as my right hon. Friend the Leader of the Opposition said, we will have to make changes? Increasingly, there are decisions that cannot be made by nation states alone. Was the Prime Minister aware how Thatcherite he was when welcoming the extension of qualified majority voting? In the 1980s, Margaret Thatcher made it quite clear that qualified majority voting was in the national interest, as it would overcome the protectionist instinct of other member countries. Was there a chance at the summit to discuss Europe's economic problems and the reform programmes that Germany and France need to put in place because of the consequences of a single monetary zone?

§ The Prime Minister
There was a lot of discussion of the basic economic situation and the importance of reform programmes. As for the point that the hon. Gentleman made about QMV, of course that is right. 719 Any country that seriously adopted the position that the Conservative Front-Bench team is now taking would inevitably, because of its total unreasonableness, have to renegotiate its essential terms of membership.

§ Mr. Eric Forth (Bromley and Chislehurst)
indicated assent.

§ The Prime Minister
The shadow Leader of the House is nodding. The debate is beginning, and we will have an opportunity through the workings of the Convention to have that debate in the House. It is extraordinary that today the Conservative party is taking a more extreme position than Margaret Thatcher used to take.

§ Joan Ruddock (Lewisham, Deptford)
Did the foreign affairs discussion include the deteriorating situation in Afghanistan? Is my right hon. Friend aware that there is great concern, particularly among women, that the Constitution Commission may not be able to carry out its work effectively because of the lack of security? How will he respond to the pleas of Presidents Karzai and Musharraf and 80 non-governmental organisations working in Afghanistan for real security to be provided by the international community outside the capital of Kabul?

§ The Prime Minister
We want to respond positively to those claims. Obviously, I had an opportunity to discuss that with President Karzai a few weeks ago, and it is worth pointing out that when I told him that it is often said here that Afghanistan is in no better shape than it was when the Taliban were in charge, his response was that anyone who seriously believed that could not have been to the same country that he had been in. There have been huge strides forward, but my hon. Friend is absolutely right to identify the fact that the problem with security is outside Kabul, which is why we are in discussion with Germany and other countries to try to make sure that we extend the remit of the security force. We will be taking part in some of the regional teams that will try to make sure that the Afghan army is built up sufficiently so that it can operate in all areas of Afghanistan and so that its writ runs from the centre to all those areas.
The point that my hon. Friend made about the constitution is right. I believe that we can safeguard the position of women and other minorities in terms of the ethnic mix in Afghanistan—[Interruption.] The different ethnic mix of minorities has to be protected too. There is also a great deal of recognition of the importance of getting the right co-operation on the drugs issue, but I am satisfied that we will be able to make progress in all those things.

§ Mr. George Osborne (Tatton)
On Iran, does the Prime Minister agree with President Bush that the students on the streets of Tehran deserve our support?

§ The Prime Minister
I think people who are fighting for freedom everywhere deserve our support, but the exact nature of the support that we are able to give is an open and different question. However, people in whatever part of the world who are trying to achieve basic human rights and civil liberties deserve support from all of us.

§ Mr. Gerald Kaufman (Manchester, Gorton)
I am surprised that the Prime Minister, when referring to the middle east peace process, did not join the United States Secretary of State in denouncing the sabotaging by the Israeli Prime Minister of the peace process with a policy of targeted assassinations, which inevitably bring on Palestinian terrorist suicide bombings of innocent Israeli civilians, whose blood rests on the head of the Israeli Prime Minister as much as on their murderers. Will my right hon. Friend now make it clear that this rogue elephant Sharon must be reined in and, if he will not assist in the peace process, sanctions and an arms ban must be imposed on him?

§ The Prime Minister
At point 85 of the Council conclusions, we made clear our opposition to extra-judicial killings and to aspects of Israeli policy with which we disagree. I know my right hon. Friend will also want me to say that it is important that we deal with all aspects of the violence. We should recognise and remember that many innocent Israeli citizens are dying in the most appalling terrorist acts. In the end, if we want to play a part in resolving that situation, it will be incumbent on us less to condemn people and more to get the situation sorted out.

§ Tony Baldry (Banbury)
The House will know that one of the advantages of European Council meetings is not only the formal sessions, but the opportunity that they provide for informal and private discussions between Heads of Government. Can the Prime Minister assure the House that he took those informal opportunities to make clear to fellow Heads of Government the urgent need to reform the common agricultural policy? We understand his point about the need for formal discussions to take place in the Agriculture Ministers Council, but if the World Trade Organisation is to succeed at Cancun, as the Prime Minister said when he came back and reported on the G8 summit, reform of the CAP is vital. There is not much time between now and Cancun, and we should like to hear him assure the House that he took every opportunity informally to impress upon his colleagues the need for action to be taken on reform of the common agricultural policy.

§ The Prime Minister
I can assure the hon. Gentleman that we take every opportunity we can to press the case for CAP reform. The one hope that we have is that at Cancun in September the WTO must reach an agreement, and we must have a proper offer from Europe in place by that time. That is concentrating minds. I am not saying that we will reach agreement in the Agriculture Council, but it is fair to say that we have come a significant distance in the past few days. I can assure the hon. Gentleman that we lose no opportunity whatever to tell people what we think. Essentially, we are in a majority on the issue, but obviously we need to move others too.

§ Keith Vaz (Leicester, East)
In the discussions on enlargement, was any mention made of the early-warning letters that have been sent by the Commission to some of the members-designate? As the champion of 721 enlargement, will my right hon. Friend give an assurance that his Government will work as closely as possible with countries that have received such letters to ensure that all outstanding points are dealt with before 1 May, to avoid the possibility of infraction proceedings being issued against some of them as soon as they become members?

§ The Prime Minister
The matter was not discussed at the European Council. There are issues that still have to be resolved in respect of that, and it is important that all the countries coming into the European Union abide by the rules of the EU. I am hopeful that these issues will be resolved. The implicit assumption of the entire meeting, which was the first time that we had met from the beginning as 25, was that the issues would be overcome and countries would be able to accede to the European Union in the way anticipated.

§ Mr. Graham Brady (Altrincham and Sale, West)
The Prime Minister is refusing the British people the right to vote on the future European constitution, on the ground that previous treaties have been signed without referendums. Does he not understand what is blindingly obvious to the British people: that the changes and the process of handing over power to European institutions are cumulative? The British people take the view that the process has gone far enough. They want an opportunity to say no. Why is he depriving them of that right?

§ The Prime Minister
The hon. Gentleman certainly let the cat out of the bag at the end of his question. The difference between us is that I do not believe that unless there is a fundamental alteration of the essential constitutional arrangements, a referendum is the proper way to proceed. The reason why we have said that we will have a referendum on the single currency, should we recommend it, is that it does represent a fundamental change in our constitutional arrangements; these proposals do not. Therefore, I do not agree that we require a referendum. The reason why I point out that previous Conservative Governments did not hold a referendum in those circumstances is to show the 722 difference between being in government, where one has to take some responsibility for getting these things right, and in opposition, where one does not.

§ Mr. Nigel Beard (Bexleyheath and Crayford)
Did the European Council consider the need to amend the stability and growth pact in order to give member states greater freedom to stimulate their economies while maintaining fiscal discipline?

§ The Prime Minister
There was not a specific discussion at the European Council on that matter, but as my hon. Friend knows, discussions are going on about how the stability and growth pact can be made more flexible to take account of the different economic conditions through which countries live. The ideas that we have put forward on that meet with a certain amount of approval.

§ Mr. Iain Duncan Smith (Chingford and Woodford Green)
The Prime Minister has simply failed to answer the very direct question about a referendum. Let me remind him that, before 1997, he made a personal pledge to hold a referendum on European integration if it was not in the manifesto. The European constitution was not in his manifesto. Will he please stop avoiding the issue and tell the House why he really will not have a referendum on this constitution?

§ The Prime Minister
I have said why—it is for the reasons that I have given today. I am glad that the right hon. Gentleman has got up for a second time, because he was saying earlier that it was no part of the Conservative party's desire to leave the European Union, but I have his quotes from the Frost programme a couple of weeks ago—[Interruption.]

§ Mr. Speaker
Order. Let the Prime Minister answer.

§ The Prime Minister
This is what the right hon. Gentleman said: It's not us leaving Europe, it's actually the others making this finally something which we don't want. That is the true dividing line. The reason why the right hon. Gentleman wants a referendum is so that he can say no, paralyse the European Union and get out. That is the real dividing line between the two political parties and it has been made even more clear today. I suggest that he gets up another time.