European Union (Amendment) Bill

My Lords, this has been, as ever, an interesting debate. I am grateful to all noble Lords who have spoken. I think it could be rather a jolly occasion, despite the concerns of the noble Lord, Lord Dykes. I begin where my noble friend left off, which is with the issue of cost-benefit analysis, and not least with what one describes as a cost and what one describes as a benefit. I fear that no cost-benefit analysis the Government could do would satisfy the noble Lord, Lord Pearson of Rannoch, in its interpretation. In rejecting the amendment on the grounds that we do not believe this would be a good use of government time or resources and we see no value in it, we are mindful of ensuring that we know exactly where we are in the European Union and are very clear in our desire to recognise the importance for the interests of this country in being part of it. The noble Lord referred to the cost in terms of the contribution to the European Union budget. I say to the noble Lord, Lord Willoughby de Broke, that it is indeed £12.4 billion. We get a £3.6 billion abatement and public sector receipts of £4.9 billion, so the net contribution to the EU budget is £3.9 billion. I hope those figures will alleviate any concerns the noble Lord might have about understanding precisely what the budget does. I hesitate to reiterate much of what has been said about the benefits of membership of the European Union. As far as this Government are concerned, EU membership is central to the pursuit of stability, growth and employment. It is clearly in our national interest, both economically and in a wider political and strategic context. It has brought benefits in jobs, peace and security. Through it, we belong to the world’s largest trading block with a single market of over 490 million people. Half our trade is now within the EU, and we estimate that about 3.5 million British jobs are linked to it, directly and indirectly. Fifty-seven per cent of total British trade in goods is with the EU, 62 per cent of our total exports go to the EU and British investments in the EU totalled £17 billion in 2005, the last year for which I have detailed figures. As noble Lords will know, I feel very strongly that membership is not only about the rights of British companies to buy and sell across the single market, but that it also allows our citizens to work, study, live and travel in the European Union and to receive free medical care if they fall sick. Improved maternity pay, the right to paid holidays and the reduction in the cost of mobile phone calls when abroad are just some of the practical benefits we have by being part of the European Union. We benefit as consumers from being part of the Union. The EU outlaws price fixing and stops companies agreeing with each other to restrict competition. Cartels in industries as diverse as vitamins, banking, airlines and energy have been targeted by the European Union in recent years to ensure that the benefits are passed on to consumers. British firms benefit significantly from the enlargement of the EU: exports to the 10 countries that joined in 2004 rose from £4.66 billion in 2004 to almost £8 billion in 2006. Our view is that these benefits would be unlikely to be available to the UK on the same, or even more favourable terms, if we left the European Union. If we left, we would be subject to customs controls and we would need export certificates. The abolition of customs duties already saves British businesses about £135 million a year. Our agricultural exports would be subject to tariffs that would be payable on some of our goods. There is a host of reasons why this would not work. Just for completeness, there have been suggestions that perhaps what we should do is negotiate some access to the single market from the outside in the way that Norway and Switzerland have done. I begin from the premise that we are not Norway or Switzerland. We are one of the largest economies in the world. We have a bigger, more diverse economy, and we should be clear that if we tried to negotiate on that basis, we would have to accept many of the laws that already govern the operation of the single market, which is what Norway and Switzerland do. Norway accepts 85 per cent of single-market legislation. We would not, however, be part of the negotiations that determined what those laws would be. Moreover, we might have to contribute to the EU budget. Norway is a net contributor to the EU budget. The difference, as I have already indicated from the figures, is that we get a lot of money back from the European Union. As an EEA member outside it, we would not. In essence, for all the reasons that I have given and for all the reasons that noble Lords know about—the benefits for citizens, and the co-operation, which we talked about earlier, on asylum, on counterterrorism, on illegal migration, on serious organised crime and so on; I could go on at length—we believe that being part of the European Union is extremely important. We hope, on that basis, that the noble Lord will withdraw his amendment.