European Affairs

I am grateful to be called to speak in this debate. Unfortunately, when the financial regulations were being debated I was leading the European Scrutiny Committee on a pre-presidency visit to Madrid; I would like to have spoken during those debates. The Chair of the Treasury Committee was also elsewhere with his Committee, and he might have made a vital contribution. The House wishes to pass a motion stating that it has considered the matter of European affairs. I hope it will agree that such consideration would not be complete if we did not give consideration to the process of parliamentary scrutiny. I shall come to that issue in my capacity not only as Chair of the European Scrutiny Committee but as one who has an interest in the effect of the Lisbon treaty. I described that treaty as a tipping point, and I stand by that. It has changed the geography and processes of not only what will happen in Brussels but, I hope, what will happen in this House and elsewhere. First, I should like to raise a few matters of substance to underscore the fact that we need changes to the structures to assist effective scrutiny. I turn to what I think are agreed to be the three new supervisory or watchdog committees on insurance, banking and the securities market in Europe. Those who, like me, have followed the process for many years will see that they are just beefed-up Lamfalussy committees. There was already the Lamfalussy supervision process, which proved inadequate, just as the supervision and regulation in this country was inadequate for dealing with the inventiveness and gambling of the banking, insurance and derivatives markets that brought this and many other countries to the serious position they are in, with massive public debt and taxpayers owning many of the banks. For some reason, we have been unable to prevent banks from doing certain things; I noticed that Royal Bank of Scotland has put aside £940 million for bonuses, yet it has just been revealed that it might be exposed to the tune of £2 billion to the Dubai debacle; I think that the total is £5 billion among British banks, even with the latest scrutiny process. The agreement on a European systemic risk board has not been mentioned. That would be a gathering of all the EU's 27 central bankers to try to do something consistently across Europe. I do not wish to score points about the weakness of Government or the failures of the regulatory authorities at our own level, but we should welcome that board. Together with the Americans, with the gambling nature of their banking, insurance and derivatives markets, we almost brought down the world's economies to the same degree as happened during the great depression. I know that Opposition Members would not say this, but, as was mentioned in debates before the Council last November, without our Prime Minister leading Europe and giving a clear lead to the President of the United States, we would have ended up in a massive depression. It appears to me that allowing some other people a say and oversight in respect of the behaviour of our banking, insurance and derivatives markets is not very much to give up from London. The European Scrutiny Committee will retain—and, I hope, use more and more—the right to call for an opinion from a Select Committee that specialises in another area of policy. We called for an opinion from the Treasury Committee, and that led to its inquiry and, I hope, fed some common sense into the debate on Tuesday. I want to mention some matters that may seem minor but that are important to our constituents. If most of them read this debate up until this point, they would wonder whether Front Benchers live in the same world as they do. It was point scoring and personalising—more like "The X Factor" than a serious debate about what affects people's lives. For example, in 2005 the European Commission ruled that it was illegal for European citizens not to be paid the same wages and for people in the shipping industry in my area of Scotland not to be given the minimum wage. That is an important matter that was debated yesterday in relation to an amendment to the Equality Bill. However, it is still possible to use non-EU citizens, and such people are being paid £1.27 to sail boats between the islands and the mainland of Scotland. The Commission could ban that for EU citizens so that it would not happen to people who came from the A8 accession countries to work in the offshore industries. My constituents would welcome that. The TUC and the Scottish TUC are campaigning strongly to have such a provision extended to everyone through the Race Relations Act 1976. [Interruption.] I have just been told that there is a 15-minute time limit on speeches. That is not necessarily welcome, but useful to know. Another apparently minor matter is the use of the European globalisation fund, which I have raised with the Scotland Secretary. That has become a fund into which people from different countries are dipping to mitigate the effects of recession, not necessarily the effects of the globalisation process. In the European Scrutiny Committee, we have insisted that such instances be reported to the House, in what we call an "A" brief, whenever they occur, because they are matters of interest. Some have been very serious. For example, in the automotive industry, when Saab lost more than 4,000 jobs Sweden asked for a contribution from the fund. Ireland got a substantial sum of money when Dell decided to pull out one of its factories. It was remarkable to find that the Netherlands got about £1 million following 570 redundancies in a construction company. Given the massive loss of employment in this country, if that is what the money is available for, we should be asking for it. Every time these funds are paid out, there is a net contribution from the UK. We should be similarly asking for funds, but for some reason the Government are not doing so. I have particularly made the point that we are losing to Ireland 500 jobs at Bausch and Lomb, which makes contact lenses. We hear that Ireland is getting money, while we are losing jobs. There is something wrong with that, and we should look at it seriously. Let me turn to matters in the Committee's remit that we have been raising with the Government. First, I want to talk about enlargement. Most recently, that has centred on learning the lessons of the accession of Bulgaria and Romania, both of which, not only in the estimation of our Committee but that of the Commission, still have an enormous amount of work to do in creating an independent judiciary and a system of governance that can and will tackle corruption and organised crime. We said at the time that those countries were allowed in too early, and they have been backsliding since. We have recently expressed to the Government a firm view about Croatia, which is next in line unless it is over-leaped by Iceland, which is looking for a rescue package for its financial crash. We say that Croatia must demonstrate actual conditionality. In other words, before accession, it must have a strong track record of effective implementation of the necessary machinery and success in tackling the ills that continue to blight them—that is, a fully functioning legal system and a track record of tackling corruption at the highest level.