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Lord Taverne: My Lords, I should like to put a further question about qualified majority voting. I understand the reluctance to see an extension of qualified majority voting to sensitive areas like defence. But how can the noble Baroness reconcile the immense benefits derived from the single market programme, made possible only through the extension of qualified majority voting, with an apparent reluctance to envisage any further qualified majority voting, even in areas such as third-party access to national energy markets where we have much to gain nationally?

Baroness Chalker of Wallasey: My Lords, I understand the point that the noble Lord, Lord Taverne, makes. However, this does not appear to be the time to extend qualified majority voting when across the whole of the European Union there is not popular concern for the growth of centralised decision making. It would give entirely the wrong signals and make it easier to overrule national governments. We need to keep unanimity for key constitutional and policy issues. I believe that there are issues that we have properly dealt with by QMV. The matter mentioned by the noble Lord, because it is a single market area, is probably one that should be covered by QMV. But I shall look again at what he said because I am not sure that I have entirely taken his point. I shall reply to him by letter.

Lord Shaw of Northstead: My Lords, I congratulate my noble friend on her Statement. I believe it to be a

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thoroughly practical and worthwhile Statement. I hope that the whole country unites behind it and extends every good wish to all those who take part in the IGC later this month. It has been said that the EU will not stand still. I entirely agree. If it goes forward it must do so on sound and firmly-based foundations. There are practical matters which have to be discussed and examined in detail and proper solutions found in order that we can in confidence go forward into the future. I believe that many of the matters which have to be looked at closely are clearly and properly identified in the Statement.

I hope that during the forthcoming and continuing conference the basic need for financial regularity will not be neglected. I am afraid that this is a matter that I raise every time in dealing with the European Union. Until we can ensure at every stage that this is being achieved, any further enlargement of the Union will bring disaster, because the irregularities which currently exist, and which were shown in the last auditors' report, will become much greater should other countries to the east be brought in.

Baroness Chalker of Wallasey: My Lords, I thank my noble friend for his comments. I thoroughly agree that there must be a sound base. I can assure him that in the continuing discussions of the IGC we will, as we always have done, continue to take the lead in the fight against fraud, waste and financial mismanagement. It was the United Kingdom who at Maastricht secured full institutional status for the European Court of Auditors, the statement of assurance--that is, the general audit of the Union's finances--greater status for the ECA's reports, and the obligation upon member states to treat fraud against the Union's budget as seriously as if it were fraud against national finances. It is absolutely crucial that we work on this matter prior to enlargement and continue to work on it. Just as one devises schemes to detect any fraud or bad dealings, so new ones are invented. It will not be something that comes to an end; it will be a continuing process, as it is in business and life in general.

Lord Bruce of Donington: My Lords, at the risk of not accelerating any differences that may conceivably exist between the Government and Her Majesty's Opposition on this matter, I should like to congratulate the Government in one respect. On page 7 of the White Paper they have reproduced, very conveniently, their views as to what progress may be made over the next five years. I find the diagrammatic form very convenient. It will certainly be helpful in holding the Government down to their own programme. I suggest that during the course of the proceedings outlined here the Government do not wait until the end before they report to Parliament on certain aspects that they achieve. It would be hopeless if a whole series of IGCs went on more or less indefinitely without Parliament being informed from time to time, on an interim basis, of what was being achieved.

The defect in the whole approach of the Government is that all the time it deals in generalities. For example, the Statement is replete with phrases such as "we see

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the force of this", "we shall continue to work tirelessly towards", "we shall play a leading role", "we are totally opposed to", or "we must prepare for". All of those phrases are beloved of the Civil Service. If the noble Lord, Lord Bancroft, had been present he would have been able to give a far more amusing comment than I am capable of doing.

Neither the White Paper nor the Statement addresses the existence of institutional powers, particularly those exercised by the Commission, which were certainly not anticipated at the time the treaty was signed or the various directives determined. In particular, I refer to the concept of subsidiarity. The Government must be aware--and both Opposition parties should be aware--of the endeavours that are being made by the Commission in bypassing national parliaments. The House should be aware of the efforts that are being made to enable the Commission to establish lines of communication and powers of legislation and direction, excluding member states, directly with the regions. It is happening all the time on a gradual basis. There are now conferences between the Commission and various local authority interests. It has already divided Europe into four different zones based on the various authorities that belong to them.

We have to be aware of this point. It is one thing to emphasise, as the noble Baroness has done today, the importance of the nation state, which I trust my own party will also endorse. It is another thing altogether to tolerate the progressive growth of Community powers exercised by the Commission direct to the regions inside the Community rather than through the member states. I hope that some endeavour will be made to correct that development.

Apart from that I wish to congratulate the noble Baroness and to say that I trust that nothing I have said has determined the coalition on this matter that presently exists between all three parties as to the essential validity of Maastricht.

Baroness Chalker of Wallasey: My Lords, I am always careful to thank the noble Lord, Lord Bruce of Donington, for his remarks but afterwards to re-read them three or four times over to make sure I really do know what I have let myself in for. He was certainly very generous in describing the diagram on page 7 as helpful. I, too, found it extremely helpful. To have it all in one place saves an endless number of pieces of paper.

The noble Lord asked that we should keep your Lordships informed during the negotiations. At the conclusion of any set of negotiations it may be possible to do so but obviously not during the negotiations. It would be foolish to reveal more widely in the middle of negotiations something that was happening before we had secured the things we are after, which I outlined in the Statement and which are stated in the White Paper.

I do not think the Statement is full of generalities, as the noble Lord tried to say. To state that one is totally opposed to something is pretty clear. I understand very well his concern about institutional powers but I do not believe that the Commission would be successful if it tried to bypass the established communication lines to national governments. I have to point out to the noble

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Lord that many Labour Members of the European Parliament have encouraged regionalisation because they believe it to be in the best interests of the regions of this country to have a direct line to Brussels. I can understand why that is seen, superficially at least, to be a quick way of doing things. But it will not fit unless it also fits with the policy of the national government of the day. Therefore, in dealing with regional matters, it is essential that the government of the country concerned are also involved in what is happening in their regions. That is something the Government seek to ensure the Commission never forgets. If the noble Lord re-reads paragraph 33 on page 15, and re-reads what I have said this afternoon, he will see that we are second to none in believing that national parliaments must remain the primary focus of democratic legitimacy.

Lord Lester of Herne Hill: My Lords, like the noble Lord, Lord Moran, I had the privilege of serving on the IGC sub-committee. I very much welcome the fact that in the Statement there is strong support for the role of the independent court in deciding what the law is and what European legislation is meant to be. However, there are two aspects of the Statement that I do not entirely understand. I should be very grateful to the Minister if she could deal with them.

First, do the Government agree or disagree with the IGC sub-committee when we say that at present no suitable tribunal is available, apart from the European Court, which could sensibly be given the job of interpreting and applying conventions drawn up under the justice and home affairs pillar? It is not clear to me whether the Government have accepted that.

Secondly, there is a reference to entrenching subsidiarity in the treaty. Is there not a danger that by doing that and making it, as lawyers would say, justiciable, we would turn the European Court into one that had to deal with political questions rather than legal questions? If that is not to be the position, who in the system will decide how the principle of subsidiarity is to be interpreted and enforced?

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