EU: UK Membership

My Lords, this is a good moment to be reviewing the UK's membership of the European Union. We are only a few days away from an important meeting of the European Council—perhaps a real turning point. We are passing through a period of change in the leadership of several of the large member states. Chancellor Merkel has already brought a welcome sense of direction and spirit of compromise to Germany's European policy and to its presidency of the European Union. President Sarkozy has just come on to the stage and the right honourable Chancellor of the Exchequer will be emerging from the wings in two weeks’ time. Experience tells us that the leadership of those three countries and their leaders’ ability—alas, in some cases inability—to work together will make a very big difference to the European Union as a whole. The European Union seems ready to emerge now from the period of uncertainty that followed the defeat of the constitutional treaty in the French and Dutch referendums. The challenges that face the EU, particularly in its external policies—trade, climate change, energy security, Russia, the Middle East, Africa, Turkey and the Balkans—have seldom been more complex and more pressing. The noble Lord, Lord McNally, and the Liberal Democrat group as a whole have therefore chosen the time well for this debate. It is fashionable to talk about the European Union being in crisis. Oddly enough, both strong supporters and visceral critics of the European Union reach for that overused word and deploy it for their own purposes. The truth is somewhat less dramatic and more complicated. It is rather hard to argue in any very convincing way that an organisation which has, in the past few years, carried out the geographically and politically most significant expansion of its membership, regulated the chemical industry, passed an admittedly incomplete first measure to free up the service industries, sorted out its finances for the next seven years, and, most recently, capped charges for international calls on mobile phones to the applause of a wide range of public opinion is somehow hopelessly deadlocked or in a moribund state. However, it is equally hard to argue that an organisation which botched its last completed effort at constitutional reform in the Nice treaty, saw its next effort—the constitutional treaty—rejected by the voters of two of the original member states, is suffering from a painful attack of enlargement indigestion and having difficulty facing up to the demands of further enlargement, and regularly punches well below its weight in international negotiations has reached a point where further reform and policy development can be taken for granted or assumed to be unnecessary. As so often, hyperbole is a poor guide for future decisions. In recent years, there has been a major shift in emphasis within the European Union from internal policy development to external policies—to the need to define Europe's global role and to adopt policies that will defend and further its worldwide interests. The great achievements in internal policy—the single market, the adoption of the euro by 13 member states with more to come, and the freedom of movement of our citizens—will remain the bedrock on which everything else is built. They will require plenty of political effort and will give rise to plenty of tensions in the years ahead—over the modernisation and refocusing of the budget, which is to begin next year, over issues of economic governance and over the still incomplete areas of capital markets, justice and immigration. They will require robust and effective institutions—the Commission and the European Court of Justice in particular—to guard against backsliding towards fragmentation of the market and the renationalisation of industrial policy. The biggest future challenges will lie in the external field, and it is there that, so far, the European Union's performance has fallen far short of what is needed. I firmly agree with the noble Baroness, Lady Williams, on that point. That is where its present diffuse and confusing institutional and decision-making structures need most adaptation. A mere glance at those external challenges is a reminder of the steepness of the hill that remains to be climbed if the European Union is to realise its full potential. The Doha round of world trade remains suspended between success and failure. The cost to the European Union of failure to complete the round successfully, particularly if that failure is attributable in whole or in part to an effort to protect Europe’s still far too highly subsidised agriculture, will in the long run outweigh the damage to any of the other participants. The post-Kyoto negotiations on climate change and limiting carbon emissions have as yet hardly begun. The European Union has given a lead withthe March decisions of the European Council. Implementing those decisions and drawing in the main developing countries and the United States to agree a meaningful package will be much harder, although last week’s G8 Summit decisions are at least a step in the right direction. The European Union has adopted a strategy for Africa, although so far it is not much more than a strategy on paper only. The cases of Darfur, Somalia, Zimbabwe and the Democratic Republic of Congo show just how difficult it will be to turn that strategy into a reality—a work of years or perhaps decades, not of months. Defining an effective policy towards Russia, whose policies so far seem guided more by post-imperial nostalgia and the precept of divide and rule than by a genuine wish to develop co-operation, will require a judicious blend of firmness and constructiveness which has not yet so far been achieved. A case for further enlargement to include Turkey and a number of Balkan countries, which was recently fully debated in your Lordships' House, is unanswerable, and failure to answer it positively could have exceedingly damaging consequences, not least for Europe’s own security. The current problems over Kosovo and the travail through which Turkey’s reforming Government are passing are a reminder of the difficult decisions that lie ahead. As for the Middle East, the need for a settlement of the Arab-Israel dispute has never seemed more imperative and at the same time more elusive. Every one of those external challenges has in common that all require a united European policy response and a concerted European effort if they are to be successfully handled. Not one can be managed by individual European states acting on their own in disharmony. So much for those who say that a common foreign and security policy is an optional extra. In Europe, policy and institutional change have always gone together and this remains the case today. The case for functional institutional change, if those external and internal challenges are to be successfully met—for more coherent external policy formulation and decision-making, for a greater role for national Parliaments, and for a more equitable balancing of voting weights and a slimmed-down Commission—is surely hard to gainsay. This is not institutional change by blueprint but a response to actual policy challenges. That is the compelling argument for drawing out of the wreckage of the now defunct constitutional treaty those elements that address those challenges—for getting rid of the rotating presidency, giving more continuity and political guidance to the work of the European Council, and accepting more majority voting on a pragmatic rather than an ideological basis. There is an opportunity to negotiate a relatively modest package of institutional changes, which would respond to the interests of the European Union and this country and be good for both. I hope that that is the path on which this month’s European Council will set us. At an appropriate moment, it will be necessary to consider how this country will ratify such a package of institutional reforms. I see no convincing reasons for moving away from the method of parliamentary ratification, which we employed for all previous amendments of the basic treaties—some of them a great deal more far-reaching than those that seem likely to emerge from any negotiations set in hand by this month’s European Council. The assertion that ratification by referendum is inherently more democratic than parliamentary ratification is completely unproven. Are the protagonists in the argument for referendums seriously arguing that Germany, which has set its face firmly against the use of such instruments, is acting undemocratically, or that the newly elected President of France, who won a sizeable majority on an electoral turnout that we can only dream about and on a platform which, unlike that of his defeated opponent, explicitly provided for parliamentary ratification of a reduced institutional reform package, is similarly planning to act undemocratically? Surely what we need in this country is not another row about how we approve an as yet un-negotiated package of institutional reforms, but rather a coming together of all three main parties behind the policies and methods to which we would like to see the European Union committed. On this front, there seems much common ground. As one who has lived and often had to negotiate through all the main stages of Britain’s membership of the European Union, I unhesitatingly say that nothing has damaged us more than the endless chopping and changing of the two main parties’ policies towards Europe and the manoeuvrings for domestic political advantage, which have inhibited the definition of firm and consistent policy objectives. No other member state has suffered that disadvantage. It is surely time to end this long-running saga and define a non-partisan approach to Britain’s European policies.