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Lord Ponsonby of Shulbrede: My Lords, I thank the noble Lord for giving way. I find his statement quite astonishing. On the one hand, he has complimented my noble friend Lord Whitty on his exceptional ability in opening the debate and on the experience that he has demonstrated before the House over the past few months. On the other hand, he is criticising my Front Bench for putting my noble friend forward as a speaker in introducing the debate. The noble Lord cannot have it both ways. If he acknowledges the quality of my noble friend Lord Whitty, I think he should acknowledge that we have put forward our best player in the debate.

Lord Moynihan: My Lords, I am most grateful to the noble Lord for his intervention. He makes an extremely good point. If it is the view of the noble Lord that the noble Lord, Lord Whitty, is the best person for the job, I would advise him to write to the Prime Minister and ask him immediately to give the noble Lord, Lord Whitty, the job. The noble Lord would do an admirable job. Everything I have said about the outstanding contribution to the House of the noble Lord, Lord Whitty, stands. I am glad that the noble Lord, Lord Ponsonby, agrees.

However, the point I have made and will make again is that it is for a Foreign Office Minister to come before the House when we have before us a matter of major constitutional importance. As I will show to the noble Lord, and to other noble Lords, the Amsterdam treaty is full of issues of major constitutional importance that

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warrant detailed consideration by each and every one of your Lordships. To proceed without a Foreign Office Minister on the Government Front Bench is an appalling reflection on the importance the Government attach to a measure which is of major constitutional importance both to your Lordships' House and to the people of this country.

I have argued that the Amsterdam treaty is important and has constitutional implications not least for our relationship with Europe and the prospective new members of the European Union. I take this opportunity to repeat that, setting aside those areas where we are in genuine disagreement--the effects of the social chapter and of the employment chapter--there are certainly broad areas of consensus between the Government and the Opposition on the treaty. We agree in principle on the legally-guaranteed retention of sovereignty over our border controls; the rejection of a merger between the European Union and the Western European Union; the protocol to entrench subsidiarity; and the rejection of proposals to give the European Union an explicit legal personality.

Yet we are told that at Amsterdam the Government delivered where they said they would deliver. We are told, too, that the negotiations at Amsterdam provided the concrete proof that the Government have "transformed Britain's relations with our European partners" and that "Britain is now respected as a constructive partner with which the other countries of Europe can do business". We shall be looking at the truth of those statements in reference to enlargement, vote weighting reforms and the size of the Commission, the opt-in to the Schengen Acquis, the Government's deal on quota hopping and the scope of the extension of powers to the European Court of Justice.

Chapter by chapter, article by article, paragraph by paragraph, we will be judging the treaty, and, by implication the Government and their negotiating skills, on a series of key tests. Does it benefit Britain's competitiveness and jobs? Does it protect and enhance British interests? Does it achieve what it set out to do? In sum, is it really the best deal the Government could get for Britain? Or did the Government in fact give up a good deal?

Where better to begin this examination of the treaty and the Government's negotiating ability than with the challenge of enlargement and the consequences of the treaty for the people of central and eastern Europe? If Amsterdam had a raison d'etre, an idea behind it, a purpose to achieve, it was the acknowledgement that Europe does not end at the Elbe and that institutional changes and reforms are necessary to pave the way for enlargement. It has been said many times before, but it is nonetheless true, that enlargement is the historic challenge of our generation. We have an opportunity to heal the divisions which have scarred our continent. But the fulfilment of this powerful mission for the future--and it is a mission--carries weighty budgetary, political and social implications. The present Union, its institutions and mechanisms, were designed nearly half a century ago for six states and no one expects those to serve effectively the Europe of the 21st century in all its diversity.

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Before enlargement can take place, therefore, difficult issues must be addressed and difficult decisions made on reform of the common agricultural policy; on reform of the structural and cohesion funds, without which we will bankrupt the Community budget; and on the size of the Commission and the re-weighting of votes in Council without which smaller member states will have power disproportionate to their populations to out-vote the larger members.

In opposition the Government said that they were "strongly committed" to the enlargement of the European Union which had "a crucial role to play in consolidating democracy and economic reform in central and eastern Europe". Robin Cook, the Foreign Secretary, said that,

    "the main concern of [the] British presidency will be to get negotiations on the enlargement of Europe off to a flying start".--[Official Report, Commons, 9/6/97; col. 806.]

The Minister of State said that it was,

    "a top priority for the future direction of Europe that enlargement of the European Union takes place at the earliest possible [opportunity]".--[Official Report, Commons, 12/11/97, col. 1000.]

Fine rhetoric, but how is it reflected in the treaty text? How did the Government ensure that Amsterdam was used to refashion the European Union to enable us to rebuild Europe? How does the treaty make the EU's institutions appropriate to an enlarged Community? The answers are that the Government failed to achieve any of these objectives and, regrettably, failed miserably. The Foreign Secretary stated,

    "I believe we can look forward with confidence to obtaining more votes for Britain and the larger countries from the Amsterdam summit. Enlargement could create the perverse outcome of the three largest nations, with a majority of the population of Europe, not having a blocking minority in the Council of Ministers. We have every reason to believe that we shall emerge from Amsterdam with an agreement that will give Britain greater weight in the Council of Ministers".--[Official Report, Commons, 9/6/97; col. 806.]

Yet he did not. For, fresh from these negotiations, the Prime Minister was forced to admit that,

    "not as much progress was made as there might have been".--[Official Report, Commons, 18/6/97; col. 314.]

So exactly what progress did take place on weighting of individual member votes in weighted majority voting? Why, when, prior to the summit, the Foreign Secretary was so confident that he would return with the key institutional reforms necessary for enlargement, does Article 1 of the Protocol simply restate the requirement, apparent since the last enlargement took place in 1995, to re-weight votes in the Council and to adjust the present number of Commissioners? And why--potentially damagingly to Britain--does it also contain a commitment to give up our second Commissioner? This is a commitment, contained in a legally binding protocol, upon which others may rely in the Court of Justice.

Britain's position had always before been that we would agree to give up our second Commissioner provided we were compensated through vote re-weighting. Now, sadly, the loss of our second Commissioner by 2003 is not to be compensated by a watertight, legal guarantee to re-weight the votes in Council. One need only consult the Foreign and Commonwealth Office memorandum to the Foreign

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Affairs Committee, which does not inspire confidence on the point. So the Government have come to the House today with a situation where we are legally bound to give up our second Commissioner in a treaty which only envisages a satisfactory vote re-weighting formula.

It is clear that the European Union cannot afford to enlarge as it stands at present, financially or administratively. This was where the treaty is most visibly and shamefully lacking and where the Government have committed their greatest sin of omission. As the treaty stands, the Government allowed the most important and most difficult decision to be postponed. It put off for tomorrow what it should have done today. I would like to know why this was and whether the noble Lord, Lord Whitty, will stand by his explanation for the failure given to me in your Lordships' House in July. He said,

    "We failed on the institutional side to agree the size of the Commission or the reweighting of votes. But we came close to agreement. The noble Lord, Lord Moynihan, asked me why. One slightly flip answer is to say that we did not reach that item until four o'clock in the morning. It may be that the heads of government of other states were not quite as alert at that point as my honourable friend the Prime Minister".--[Official Report, 28/7/97; col. 72.]

The noble Lord may see nothing inappropriate in giving a flip answer to such a question. But I wonder whether the peoples of central and eastern Europe share the joke. However, as I turn to examine the Government's negotiations on our opt-in to the Schengen Acquis the noble Lord's explanation for the Government's failure on enlargement seems to be a case of many a true work spoken in jest.

For certainly the early hours of the morning do appear to be a particularly low point for the Government's ability to negotiate, as is amply demonstrated by the negligent negotiation over the Schengen Acquis. This agreement will move those countries who have chosen to participate in it towards a European Union without common border controls.

The Opposition welcomed the Government's seamless transition of policy in retaining sovereignty over Britain's border controls through the legal, binding protocol to the treaty, although I must add that our support is not surprising in the light of the agreement reached in March when a complete British opt-out on border controls was first agreed in principle. The Government are absolutely right to proclaim that as a major achievement, which is exactly what it was-- a Major achievement with a capital M!

When we come to the Committee stage we shall be seeking clarification on the issue of Article 4 of the protocol integrating the Schengen Acquis into the framework of the European Union. It is my understanding that as result of negligence on the part of the Foreign Secretary, a late amendment by the Spanish Prime Minister was accepted into the treaty by default in the early hours of the morning of 18th June meaning that any member state, including Spain, would have a veto over future opt-ins to the Schengen Acquis which will be decided now by unanimity rather than by qualified majority voting. This potentially hands the Spanish a powerful bargaining chip with which to exact concession over Gibraltar. I would like to repeat the

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question of the noble Lord's colleague, the Labour Member for Wrexham, to the Foreign Secretary. He wanted to know whether that had simply happened because Her Majesty's Government do not care about Gibraltar and give it a low priority or,

    "was it just a Government cock up?"--[Official Report, Commons, 25/11/97; col. 754.]

The Dutch Government, unsurprisingly, have clearly been concerned that we have had four different explanations for this failure to negotiate in another House. Clearly concerned by these extraordinary allegations of the behaviour of two member states, they wrote to the British Government as long ago as 16th July. Given the Government's commitment to open government and transparency, will the Government give the House an assurance that that letter will be published?

But there will be those among your Lordships who will be far more concerned about the reforms to the appointment of the President of the Commission and of the new Commissioners from member states, where a reasonable explanation might well be that the negotiations again took place too early in the morning. It would seem to me genuinely to be the only explanation for what has happened in the treaty text.

Of all the changes agreed by the Government in Amsterdam these reforms have potentially the most long-term significance for the people of Britain. The treaty gives away important national powers by diminishing the freedom of member states to appoint the Commissioners of their choice. In future, the European Parliament will have to approve the new President of the Commission and the President of the Commission has been given new powers to veto the appointment of new Commissioners and can therefore effectively pick the other 19 Commissioners. Do the Government agree that these changes take far-reaching power away from democratically-elected governments, who are accountable to the people of their countries, and place it in the hands of an unelected official? Why did the Government agree that the President of the Commission should have the power to veto Commissioners chosen by member states? What was the possible justification for the change?

The Minister of State in another place said on 15th January at col. 544 of Hansard,

    "The changes are very much in Britain's interests".

Do the Government think that it is in our national interest that no President of the European Commission can be appointed unless the European Parliament agrees? Do the Government think that it is in our national interest that we in the United Kingdom can no longer be guaranteed the right to chose our own Commissioner? Do the Government think that it is in our national interest that the Commission must in future work under the "political guidance" of its President and that the President now has the power to hire and fire? Yes,

    "The Commission shall work under the political guidance of its President".

The word "political" is inserted for the first time under Article 2, paragraph 41 of the Treaty of Amsterdam. Does the Minister think that it is in our national interest

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that the balance of power has shifted from intergovernmental control towards a political Commission led by a political President?

This is no simple consolidating treaty. It is a major constitutional issue which, on the points I have already raised and put before your Lordships' House, requires detailed consideration and lengthy and detailed answers. I just do not know the justification for that fundamental shift in the nature of the Commission. The Minister of State justified the powers to the European Parliament, saying that,

    "as Members of the European Parliament come from the same countries and political parties as Council members, I do not think that their views will be very much out of line with the majority Council view. The fear is therefore unrealistic".

Given that faith in MEPs--if they have such faith in their MEPs to reflect their line--why did the Government disgracefully, undemocratically and repeatedly try to gag their own MEPs when they expressed a socialist agenda?

If the Minister cannot,

    "foresee a situation in which the European Parliament would reject someone as President if the Council had agreed on who he or she should be",

what was the reason for enshrining in treaty form the provision to allow the European Parliament to set aside the unanimous views of member states? The Minister of State justified the shift to a political Commission because,

    "some commissioners do not always take the Commission ... view ... and grind their own axe. Some Commissioners have a view of their own and go off on their own track".--[Official Report, Commons, 15/1/98; col. 544.]

We know that the Government disapprove--

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