HL Deb 14 December 1998 vol 595 cc1127-40

4.26 p.m.

The Lord Privy Seal (Baroness Jay of Paddington)

My Lords, with the leave of the House I will now repeat a Statement being made in another place by my right honourable friend the Prime Minister. The Statement is as follows:

"With permission, Madam Speaker, I will make a Statement about the meeting of the European Council on 11th and 12th December which I attended in Vienna along with my right honourable friends the Foreign Secretary and the Chancellor of the Exchequer and my honourable friend the Minister of State, Foreign and Commonwealth Office. The Council conclusions have been placed in the Library.

"The Council concentrated on employment and economic issues, Agenda 2000, enlargement, the future development of Europe and a number of foreign policy questions.

"At Vienna, the last Council before the introduction of the euro by 11 member states, we confirmed and strengthened the strategy on economic reform and employment agreed at Amsterdam and Luxembourg last year and reinforced at Cardiff earlier this year. Macro-economic stability provides the essential basis for long-term growth. Supply side reform must go hand-in-hand with this. Member states have now submitted national progress reports on reform of product and capital markets. These will be subject to rigorous peer review in the first part of next year.

"There will be a parallel review of national employment action plans, the first set of which were submitted during the UK presidency. At Vienna, we agreed revised employment guidelines on which next year's national action plans will be based. The new guidelines fully reflect British priorities. They place particular emphasis on tackling long-term unemployment; promoting equal opportunities; making a reality of life-long learning; fully exploiting the potential of the service sector; creating the right climate for entrepreneurship; reviewing tax and benefit systems to provide incentives for the unemployed to take up work or training; promoting social inclusion; and examining regulations to ensure that they reduce barriers to employment. This work will be carried forward under the German presidency to produce an employment pact, within the framework of a wider process aimed at employment, growth, stability and economic reform.

"Jobs remain Europe's top priority. The strategy developed over the past 18 months is beginning to bear fruit, with over 1 million new jobs created in the EU in the last year, including over 250,000 in the UK, and the overall rate of EU unemployment falling below 10 per cent. for the first time since 1992. But member states need to step up their efforts to implement real reforms in their labour markets, learning from one another. It was noteworthy that representatives of small businessmen were included in the dialogue between heads of government, employers and unions for the first time at Vienna.

"Also in the economic field, we agreed new measures to complete the internal market, not least in financial services, improve innovation, increase the availability of risk capital and strengthen investment in infrastructure. We agreed on the gravity of the challenge posed by the millennium bug and the particular need to protect national and international infrastructure.

"We also discussed the desirability of better economic policy co-ordination. A small part of this discussion concerned tax policy. The Council agreed that co-operation in this area is not aimed at achieving uniform tax rates or preventing fair tax competition; rather its aim is to reduce harmful distortions in the single market, prevent excessive losses of tax revenue, and encourage employment-friendly tax structures. Work will continue on long-standing proposals on energy taxation and on taxation of savings, with a view to reaching agreement by next December. The UK Government will ensure that British interests—including those of the City of London—are fully protected and promoted in those discussions.

"On a separate tax matter, I and others called for a review of the 1991 decision to end duty-free sales in Europe from next year, not least since the proposed successor arrangements risked ridicule. The Council asked the Commission and finance ministers to examine by next March possible means of addressing the problem, including a limited extension of the transition arrangements. Unanimity is required to secure a change, but a door which seemed firmly closed is now at least half open.

"The council endorsed the finance ministers' report on external representation of the euro area. The UK's essential interests are protected: our membership of the G7 and other international fora will continue as before. We also confirmed an agenda for reform of the international monetary and financial system very much in line with the ideas which my right honourable friend the Chancellor and I have been arguing for—more transparency in international and national financial markets, better co-operation between the IMF and other actors, strengthened prudential and regulatory standards.

"Much of the discussion in Vienna was about Agenda 2000. This is a wide-ranging and important negotiation embracing the reform of the common agricultural policy to help the consumer, create a more efficient and competitive agriculture sector and reduce the burden to the taxpayer; and reforms to the structural and cohesion funds to ensure that they are fair and affordable, including after enlargement. On future financing, the UK is among a large group of member states arguing for stabilisation of expenditure at current levels by the year 2006. Vienna confirmed the political objective of reaching overall agreement at a special meeting of the European Council on 24th and 25th March.

"As for the British budget rebate, I repeat what I said in Vienna. The rebate is still fully justified and will remain. Even with it, the UK is the fifth largest net contributor in per capita terms, while we are ninth or tenth in terms of GNP. We still pay far more than countries such as France, with the equivalent population and slightly higher national income.

"On enlargement, the European Council welcomed the fact that the first practical results have been reached in negotiations with Cyprus, Hungary, Poland, Estonia, the Czech Republic and Slovenia. It also welcomed progress made by Romania, Slovakia, Latvia, Lithuania and Bulgaria; welcomed the reactivation of Malta's application; and recognised the importance of implementing the EU's strategy to prepare Turkey for membership. Work in all these areas will intensify next year.

"In the UK presidency my right honourable friend the Deputy Prime Minister led work in the EU on integrating environmental policy into other community polices. The Austrian presidency carried forward this work in the fields of transport, energy and agriculture. At Vienna we agreed that it should be developed further into the areas of international development, the internal market and industry.

"At Cardiff, I launched a debate on the future development of the EU which was carried forward at the informal summit in October. We agreed in Vienna further steps to make a reality of subsidiarity and improve the effectiveness of EU institutions. We will issue a millennium declaration setting out the Union's priorities for the period ahead at the end of next year, to coincide with a new Commission taking office.

"At the informal summit in October, I urged the strengthening of the EU's foreign policy, not least by backing it with a credible capability for military action in regional crises where the US or NATO as a whole does not wish to be engaged. The joint declaration agreed with the French at St. Malo on 4th December gave us a sound basis on which to build this initiative. It was widely welcomed by partners at Vienna. We agreed that work should be taken forward under the German presidency. There is of course no question of undermining NATO in any way. Strengthening European defence capability will strengthen NATO.

"On current foreign policy issues, we underlined the urgency of bringing the parties in Kosovo to a political agreement and the importance of the EU continuing its political and economic support for the Middle East peace process. We repeated our readiness to help Russia overcome its present severe difficulties, and agreed that Russia should be the subject of one of the first CFSP common strategies when the Amsterdam Treaty enters into force.

"The Vienna Council made useful progress on the economic and employment points, and above all laid a solid foundation for the difficult Agenda 2000 negotiations in the next three months. Britain's interests were safeguarded and promoted without difficulty. We defended our positions, in a constructive way, just as others defended theirs.

"In the days before Vienna we issued joint statements with Spain on structural reform, with Sweden on social policy, with France on defence and with Germany on tax. All of these were welcomed in the discussion and reflected in the conclusions. At Vienna itself we helped shape the debate on economic and employment issues, on Agenda 2000, on enlargement and other issues in sensible directions, fully consistent with our interests.

"This Government have transformed Britain's relations with the rest of the European Union since they took office. It is in the fundamental interests of this country that we remain fully engaged in the debate on the development of the EU. On this side of the House we have the confidence in our arguments, and in our ability to build support for them, to believe that we can win the debates in Europe in favour of economic reform, and an open and decentralised Europe.

"Those who would end up by taking us out of Europe, or so far to its margins as to eclipse any serious influence in Europe, would profoundly damage this country. This Government will not be swayed from their positive and constructive European policy. I have no doubt that this is the right course for Britain's future."

My Lords, that concludes the Statement.

4.36 p.m.

Lord Strathclyde

My Lords, I thank the noble Baroness the Leader of the House for repeating this important Statement and wish to go on to ask her some questions and make some comments about the issues that she has raised.

First, though, does she recall that, after the so-called informal Council that took place at Poertschach some weeks ago, my noble friend Lord Cranborne and I pressed for a Statement to be made in the House on the undertakings given on European defence integration, on tax harmonisation and on closer integration? Does she agree that at the time no Statement was given to this House because of the disinclination of her right honourable friend the Prime Minister to make a Statement in another place? Does the noble Baroness now agree that, in the light of what has taken place at the Vienna summit, it is clear that substantial efforts were already in train at that earlier summit to give new momentum to European integration and that it would have been better to have made a Statement? Indeed, does she accept that the Prime Minister might have been in a stronger position at the Vienna summit if he had had the reaction and support of the British Parliament behind him? Will she therefore give the House an assurance that, as this process develops, Statements will in fact be given in this House on important informal summits such as the Poertschach meeting?

Turning now to the substance of the issues decided in Vienna, I welcome the reaffirmation of the need to take action against the scandal of Community fraud. Will she accept, however, that the problems of fraud have long been identified and that we on this side will find it disappointing to read that a review in Council of the fight against fraud will not take place until December 1999? Is she aware that we also welcome the restatement of the aim to widen membership of the Union? But has she also noted that, while the Presidency Conclusions speak of "new momentum on integration" and "a new impetus towards a defence role for the European Union", they refer only to maintaining momentum on enlargement? Can the noble Baroness inform the House whether the Government's prime strategic objective is to widen the Union or to deepen it? If widening the Union is the objective, what specific success can she report for British influence in Vienna?

I welcome the underlining of the commitment to subsidiarity and the reduction of unnecessary regulation. This is something for which my right honourable friend Mr. Major, when he was Prime Minister, laboured long and hard. Will she give the House examples of Community legislation that has been modified or repealed under this agreement as a result of the British Government's initiative?

So much for what we can welcome. Will the noble Baroness note our concern and disappointment as regards the overall outcome of the summit? Is she aware that the pronouncements of the Prime Minister on the issues before this summit were somewhat confused, and that they have not become any more convincing or consistent the more often they are repeated? Does she agree that the Prime Minister tends to emphasise a different line depending on where he is speaking? Did she note his remarks on GMT when he said that my noble friend Lady Thatcher was right to stand firm for Britain's interest, but that on the other hand she was wrong to stand so firm? Is the Prime Minister standing anywhere on his European policy except on his head?

What did the Prime Minister mean when he said that the UK rebate was up for negotiation? Is it, and what were the conclusions of Vienna on this? What did the Prime Minister mean when he wrote in The Times today that there is a genuine debate on aspects of tax harmonisation? Is the noble Baroness aware that the Prime Minister agreed in Council to pursue work on a directive on taxation of savings and a directive on interest and royalties? In that work what do the United Kingdom Government rule in and what do they rule out?

The Council emphasised the need to combat harmful tax competition. What tax competition do the UK Government consider harmful? The Council agreed that it wished to get national tax structures, to develop in a more employment-friendly way", and commissioned a study on company taxation. What will the UK Government say to UK business on this? What are their objectives in agreeing to it? What is the Government's policy on a Europe-wide withholding tax?

The Presidency Conclusions talk of a new impetus on European defence integration following the Poertschach meeting. How far are the Government prepared to go in dismantling the Western European Union? Will the noble Baroness the Leader of the House allow a debate in government time and explain what specifically they see as the long-term role of the European Union on defence?

I believe that the Government have come to a crossroads. The rhetorical plaster that the Prime Minister has put over his incoherent policy on Europe is coming off. The European Council conclusions—endorsed by the Prime Minister—proclaim new momentum on European integration. The train is on the move. Are the Government on the train, or off it? Are they trying to apply the brakes, or propel it forward? I think that this House needs to know the principles guiding the Government's policy on Europe. I hope soon we shall be told that.

4.42 p.m.

Lord Rodgers of Quarry Bank

My Lords, while I thank, as always, the noble Baroness the Leader of the House for repeating the Prime Minister's Statement, I hope that I am not alone in looking forward to the day when reports of the European Council will be seen as too routine to deserve such formal prime ministerial Statements. In practice, the report was of a relatively quiet weekend in Vienna, despite the predictions of stormy and difficult negotiations. Almost all there is to know has already been said in the communiqué, in press briefings and on television. In that respect I certainly do not intend to follow the noble Lord, Lord Strathclyde, in discussing yesterday's television programmes or, for that matter, today's newspapers. I shall limit my remarks rather rigorously and show discipline by dealing with the Statement itself.

I hope that there is much for all of us to endorse. As regards enlargement, certainly I think we can endorse what the Statement says, although the process of enlargement is much too slow. I do not think Vienna accelerated the pace in any way at all. As regards the British budget rebate, we have been told what we always knew—despite the noise which was made by the Conservative Party in advance of Vienna—namely, that it was never seriously at risk. As regards strengthening the European Union's foreign policy with a credible capacity for military action, I think that step was widely endorsed in both Houses of Parliament only a week ago. It is good to hear that jobs remain Europe's top priority and I hope they still remain a top priority here and we shall not always be carried away with regard to the percentage or the decimal point of inflation. I think we all know that the common agricultural policy remains a great unsolved problem with which the European Union must continue to battle.

I cannot work up nearly as much passion as the Prime Minister on duty-free sales and I wonder whether that was entirely a wise use of prime ministerial time. However, I may be an exception on that matter, even in your Lordships' House, and therefore I rest my case. As regards tax harmonisation, despite all the excitement that was a dog that did not bark. I welcome the fact that the Statement acknowledges, properly, that there is a place for reform to reduce distortions in the single market. It was necessary and inevitable that certain tax matters should be looked at in the light of the single market and its proper functioning as a level playing field.

The noble Baroness the Leader of the House repeated—as it was proper to do—the Government's claim to have transformed Britain's relationships with the rest of the European Union since they took office. There is at least an element of hyperbole in that. I do not doubt that the Government have created good will and optimism and I think that we on these Benches greatly welcome that. However, it is too soon to say whether they have delivered a whole new way of treating Europe, or if they are willing to explain to the nation as a whole exactly the nature of relationships within the European Union. They need to describe the whole negotiating process; that is, that negotiations inevitably involve statements of position, give and take and compromise when 15 nations properly seek to defend their own interests. They need to say also that, whatever the short-term problems may be—and sometimes difficult short-term concessions—the objective must always be the long term and where Britain's long-term interest lies. As we see the matter from these Benches, it lies unequivocally with active participation in the European Union.

My only question is one which I think the noble Baroness would describe as rhetorical. Is not the real choice for any government today between sharing fully in the move towards the development of the European Union, declaring now their intention to participate in the euro at a specific early date—that is one possibility—or effectively to move into a semi-detached position (as Her Majesty's Opposition appear to be doing) with the logic of becoming a lame duck member of the Union or getting out altogether? Will the noble Baroness endorse my view that these are the two historical alternatives which shine through all the detail of the weekend in Vienna?

4.47 p.m.

Baroness Jay of Paddington

My Lords, I am grateful to both noble Lords for their contributions and for their general welcome of the Statement. I accept that the final question of the noble Lord, Lord Rodgers, is largely rhetorical. However, he referred—I think the Statement also reflects this—to a division in understanding on the long-term future of European commitment as between this side of the House and his Benches and those in the main opposition party. However, I say to the noble Lord, Lord Strathclyde, that that underlines the difference of principle. Although I would not go quite so far as the noble Lord, Lord Rodgers, in advocating the immediate, or at least time-limited adoption of the euro, we share his main sentiments and they certainly underline the principles behind much of the Government's attitude to European discussion.

The two noble Lords appear to differ on whether this Statement should have been made at all. As regards the report to Parliament on the informal earlier summit, I say to the noble Lord, Lord Strathclyde, that I am, of course, aware of the correspondence between his predecessor and myself on this subject. I have taken advice on this matter since the noble Viscount, Lord Cranborne, raised it at an earlier stage. I understand that it is extremely rare—I believe there has been only one such occasion in the past decade—to report informal summits to Parliament. I believe this is also relevant to the position that the noble Lord adopted on the question of holding another debate on some of these issues in government time. I point out that recently there has been not only your Lordships' debate on the Strategic Defence Review but also a whole day on the debate on the humble Address. Those debates covered many of the subjects. There have been opportunities recently to look at them in general terms and I do not feel that the House has been left uninformed, as discussions have proceeded. I am sure that through the usual channels that situation will continue.

The noble Lord raised specific points about tax harmonisation. As I said in repeating the Statement, the issue did not attract controversy at the summit because it became a matter on which the issues which the noble Lord sought to describe as being of some immediate concern, were not addressed. I quote directly from the conclusions: Co-operation in the tax policy area is not aiming at uniform tax rates". The UK will not support any action at the EU level or anything which does damage to business competitiveness or jobs. There is no question of tax changes being imposed upon the UK. If we consider the taxation proposals which might be in Britain's national economic interests, there are obviously some in which interesting discussions and developments may arise at the EU level. We have long supported action within the G7, the EU and the OECD to combat harmful tax competition. That action will continue.

The noble Lord also raised questions of welfare and employment. Those, too, are matters where agreements at Vienna continued the policies which had been established in the immediately preceding summits. The noble Lord was concerned that the discussion on fraud would only come to fruition later in the year. I hope he agrees that some of the substantive decisions on ways of combating fraud, and the joint activities between the European partners which have led to much more detailed discussion both of the possibilities of investigating fraud within the individual countries and within the European institutions, are to be welcomed. I am sure they will be taken forward with vigour.

In response to the noble Lord's questions, I end by saying that he asked me to define the position of the Government in the long term. I need only repeat that the welfare of the United Kingdom will be vigorously pursued by the Prime Minister and all members of the Government who engage in discussions with the European Union at every possible level. However, we believe that the prosperity and security of this country can be achieved and advanced through the European Union. We see it as part of the mature development of European politics to which we hope all parties agree.

4.53 p.m.

Lord Shore of Stepney

My Lords, I echo my noble friend's thought that the Statement was excessively long on words and extremely short on acts and decisions. Those will be left to the Council when the Germans take on the presidency at the beginning of this coming year.

I wish to raise two points with the noble Baroness at this stage. The first is on taxation, which the Government's press spokesmen have underplayed almost as ludicrously as some hysterics have overplayed it in the press. After all, no fewer than five separate taxes are on the agenda and were discussed. I wish to ask the noble Baroness about two taxes: those on which directives are being prepared and those which are expected to be agreed by the Helsinki council in six months' time. Have we reached an agreement on the two taxes? I refer to the tax on savings and the tax on interest and royalties.

That apart, I have one short question on which I seek reassurance from my noble friend in regard to the section on external relations. Euro-land, with its euro, will be represented on the IMF and the G7—those major forums. Is it really the case that, as the communiqué states, not only is it desirable for the Community to speak with one voice but that the Community must speak with one voice? Does that mean that Britain's independent voice and vote on the IMF and G7 is now to be brought to an end?

Baroness Jay of Paddington

My Lords, I am grateful for my noble friend's questions. As to the timetable on specific questions regarding taxation on savings and interest, although, as he rightly said, there is continuing discussion on them, it is only discussion. There has been no agreement to reach a decision at a particular point. There is all still to play for. As I said in reply to the noble Lord, Lord Strathclyde, the United Kingdom will not support action that will damage business competitiveness or jobs.

On our representation in the international organisations, the UK retains its seat on the IMF and at the G7 and other important bodies which discuss issues in the international forum. We have been successful in obtaining, and we always intended that there should be, an important distinction between those issues which would be considered as relating to the 11 euro members and the wider concerns of the 15. I hope that that reassures my noble friend.

Lord Waddington

My Lords, can the Leader of the House assist me? I gather that on tax harmonisation the Council said that the object of the exercise was not to bring about uniform tax rates but to stop, among other things, excessive loss of tax revenue by a country. Did anyone explain when a loss of tax revenue is acceptable and when it becomes excessive? Did the Council say who is to judge whether any loss of tax revenue is excessive and when it is acceptable?

Baroness Jay of Paddington

My Lords, I may be leading the noble Lord astray, but all I can do is to repeat to him the words in the communiqué: Co-operation in the tax policy area is not aiming at uniform tax rates and is not inconsistent with fair tax competition but is called for to reduce the continuing distortions in the single market, to prevent excessive losses of tax revenue or to get tax structures to develop in a more employment-friendly way". I read that because I thought it was the most sensible way to be explicit about the points raised by the noble Lord.

Lord Wallace of Saltaire

My Lords, referring to what was left out of the report, there was a quite substantial Austrian presidency paper on further development in justice and home affairs, particularly on immigration and asylum. If I understand it correctly, so far there are four European councils calendared for 1999. One of them, in Tampere in October, is to be devoted almost entirely to justice and home affairs. Was that not a subject on which the European Council spent time? If it is to be one of the major issues—and it is already one of the major activities of the European Union—could it be a subject for a government Statement on the British attitude, and perhaps a debate in this House?

Baroness Jay of Paddington

My Lords, a debate in this House would obviously be a matter for the usual channels. However, it has a resonance to which many noble Lords would agree.

The position on the action plan on justice and home affairs which was originally proposed by the Austrian presidency did not find agreement. Therefore, it was not discussed in the summit. But there has been a little confusion. I understand that there was also in circulation—and it was widely reported in the British media—a paper called Corpus Juris intended to take forward some of those matters. As I am sure the noble Lord knows, it was simply an academic institution paper and was not designed to reflect any of the positions to be taken either by the UK Government or by the Council of Ministers.

Lord Barnett

My Lords, I wish to take up two points with my noble friend. The first is on taxation. Does she accept that any rational Member of your Lordships' House would welcome and support the points made in the Statement? I refer to the aim to reduce harmful distortions, prevent excessive losses of such revenue and encourage employment-friendly tax measures. I hope that the noble Baroness will ignore those who laugh at these matters and accept that there would be no point in arguing with anyone who irrationally disagrees because they are no longer sensible.

On enlargement, will the Minister state that, despite the welcome of the negotiations which have started, there is likely to be a long delay due to the lack of agreement—in particular, on those areas on taxation under CAP—and that those who plead for greater enlargement know that it will not occur at least for a very long time?

Finally, I recognise that there has been no real progress in Vienna. I doubt whether many people expected it. However, do I take the more euro-friendly tone of the Prime Minister to mean that it is now a matter of when we join rather than if we join?

Baroness Jay of Paddington

My Lords, my noble friend invites me to tread difficult waters as regards his latter point and his invitation to question the rationality of some Members of your Lordships' House in raising points—as I am sure they have always done—perfectly legitimately.

Although I know that there has been some speculation that the enlargement process has run out of steam and was not given an enormous push at Vienna, there are clear understandings behind the Statement and the communiqué that fast progress is expected under the German presidency to maintain the momentum, and that there should be new dynamism in and with those countries which are not yet in the formal negotiating process. Therefore, I do not necessarily agree with his understanding that there has been no progress in that field. I am sure my noble friend would not expect me to respond immediately.

Lord Pearson of Rannoch

My Lords, I wonder whether I can ask the noble Baroness the Leader of the House about two highly dubious claims in the Statement. The first is the claim that the EU's employment strategy is beginning to bear fruit, especially through new internal market measures in financial services which are supposed inter alia to increase the availability of risk capital. How do the Government square those claims with the loss of jobs and the damage to our economy which we are starting to suffer in, for example, our international art market and in our mergers and acquisitions industry in the City of London from harmonising EU legislation? If I am wrong about that, and the Statement is honourable in that area, can the Minister assure the House that we are indeed to escape from the effects of the VAT directives, droit de suite, and the takeover directive?

The second claim is at the end of the Statement and is even more absurd, I should have thought. It is to the effect that it would be profoundly damaging for this country to leave Europe. I suppose that it depends what the Government mean by the word "Europe". What do the Government mean by that word? Do they mean the common market, the single market, the Treaty of Rome, or the Europe of nation states? Presumably it is common ground that we do not want to leave the common market. But we would not damage the 15 per cent. of our economy which takes place with the EU if we left the Treaty of Rome. That would be profoundly beneficial to the remaining 85 per cent. of our economy which takes place in the United Kingdom and with the rest of the world.

In short, why would it be disastrous to leave the treaty but to stay in the common market?

Baroness Jay of Paddington

My Lords, I am grateful to the noble Lord for his comments. The art market is a specialised area. I hope that he will forgive me if I do not respond immediately. I shall discover the answer to the points he made on that specialised area and will write to him about the VAT matter.

I simply say that it is in the Statement. Although I realise that there are difficulties in various economic and employment sectors throughout the UK, and in other parts of the EU, nonetheless over 1 million new jobs were created in the EU in the past year and over 250,000 of those were in the UK. The overall rate of EU unemployment has fallen below 10 per cent. for the first time since 1992.

As regards which part of Europe we are discussing, and how we define it, I think that when the Prime Minister, and indeed any Member of the Government, refer to leaving Europe they refer to the European Union.

Lord Bridges

My Lords, the Statement referred to the forthcoming entry into force of the Treaty of Amsterdam. Can the Minister say when she expects that to be? Have we deposited our instrument of ratification of the treaty? Perhaps I may remind the Government Front Bench that in the course of our debate a few weeks ago on the report of the Select Committee on the Treaty of Schengen I suggested that the Government should make a further communication to Parliament before deposit of our instrument of ratification. I still await a reply to the question that I put twice in that debate, I think to the noble Lord, Lord Whitty.

Baroness Jay of Paddington

My Lords, as the noble Lord will be aware, not all countries have yet ratified the Treaty of Amsterdam. Therefore, it is not possible to assess an exact date for its overall implementation. I shall follow up the noble Lord's inquiries to my noble friend Lord Whitty. I am sure that he will respond very shortly.

Lord Bridges

My Lords, the Minister did not reply to my specific question as to whether we had deposited our instrument of ratification of the treaty.

Baroness Jay of Paddington

My Lords, I am advised by my noble friend from the Foreign Office, and as regards my briefing from the Foreign Office, that that has not yet happened.

Lord Stoddart of Swindon

My Lords, I might have been able to give a welcome to the Statement that the Government believe that we are on the road to an open and decentralised Europe if I could believe that to be true. However, is it not true that the Statement is centralist; and is not Europe going in the direction of a centralised, closed and secretive European Union rather than the reverse?

I ask the Minister one question on the rebate. Is it not incongruous that countries such as Spain, Greece, Portugal and Ireland should be demanding an end to the British rebate while at the same time holding out their begging bowls for even more money than they already receive? Is it not a fact that after the rebate this country is still paying £2.6 billion net? Can I have the assurance that under all circumstances the Prime Minister will resist the ending of our rebate or any diminution of it?

Baroness Jay of Paddington

My Lords, I am sure my noble friend will not expect me to agree with the general sentiments he expressed at the beginning of his intervention.

Although my noble friend may be referring to statements reported by the media in the countries he mentioned, there was no formal discussion of the rebate during the Vienna Summit. Therefore, the Prime Minister's strong position on maintaining the UK's determination to continue that rebate stands.

The Earl of Carlisle

My Lords, while welcoming the desire of the European Union to assist the Russian Federation through its severe difficulties, many of which have been self inflicted, will the Council bear in mind that the smaller nations of central Europe, such as Latvia and Lithuania, have not yet been invited to start negotiations? Will we ensure that the technical aid which goes to the Russian Federation is matched by the technical aid to those two nations whose environment has been severely affected by the Russian Federation and its predecessor, the Soviet Union?

Baroness Jay of Paddington

My Lords, I am grateful to the noble Earl for again raising the question of those particular countries. I hope he will have taken the point from one of my previous responses that, following the Vienna Summit, it is hoped that during the German presidency there will be an acceleration of discussions with those countries who have not yet entered into formal negotiating positions so that the dialogue can be continued in a productive way. As to aid, the Vienna Summit had a particular concern to ensure that some of the difficulties in previous years, when aid had been given to Russia and there was doubt about where it had ended up, should not be repeated. There have been some very important discussions as to how aid should be distributed. In regard to the absolute amounts being matched as between Russia and other countries, I am afraid that I am unable to give the noble Earl that assurance.

Lord Beloff

My Lords, the Leader of the House will be aware that her right honourable friend the Prime Minister has blamed the press for some of the anxieties that are being expressed about events within the European Union. Does she agree that it is enormously important for the press to report in full, to an even greater extent than it does at present, statements made by leading figures in continental countries? That, incidentally, would help to explain the point, made by the noble Lord, Lord Barnett, that there is a discrepancy in the views on whether it is desirable that enlargement should be a first priority of the European Union.

Baroness Jay of Paddington

My Lords, before I respond to the noble Lord, Lord Beloff, perhaps I may correct one earlier comment. I am delighted to announce that my noble friend Lady Symons has confirmed that we have now formally ratified the Treaty of Amsterdam, although this has not brought it into being. I apologise to the House for my earlier incorrect statement.

To come to the comments of the noble Lord, Lord Beloff, on the position of the newspapers, it is important to encourage open debate on all of these subjects, and that point has been made, but that is very different from the simple assertion of facts that are incorrect. Some of the assertions in the past few weeks in the British media about the supposed discussion on tax harmonisation have not assisted mature general debate, which I am sure the noble Lord wants to see developed. I refer to the comments in yesterday's Observer by the right honourable gentleman Mr. Kenneth Clarke, the former Chancellor of the Exchequer. He dismissed discussion of some of the issues about tax harmonisation as hysteria and farce. It is not simply those on this side of the House who believe that some of the discussion has been distorted. The noble Lord is right that there should be open discussion, but I hope that the debate on enlargement will be more factually informed than some of the recent discussion on tax harmonisation.

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