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Lord McIntosh of Haringey: My Lords, if the noble Lord refers to the second Severn crossing, the toll charges there have been a matter of agreement between the Government and Severn River Crossing plc. It is primarily a matter for the company to decide the charges in accordance with that agreement. A difficulty arises in relation to some crossings, in that there is a limit to the increase in charges, and that is true of both Dartford and the Severn. Any annual increase is restricted to the increase in the retail prices index. That may prove a difficulty which will have to be faced if and when the European Court of Justice finds against us.

Lord Berkeley: My Lords, do the French and Italian Governments pay VAT on the tolls on their motorways, some of which are privatised and some of which are state-owned? Are they, too, subject to the future ruling in the European Court? Secondly, if the Commission is proposing VAT on road tolls, is it proposing VAT on bus and train fares, Underground fares, air fares or any other kind of travel within the Community?

Lord McIntosh of Haringey: My Lords, the answer to the second question is no. The answer to the first is that the Commission's action before the European Court of Justice will relate to all those countries, including the UK, France, Holland, Ireland and Greece, which charge tolls on roads.

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Lord Pearson of Rannoch: My Lords, in view of the European Court's record of agreement with the opinions of the Advocate General, can the Minister tell the House with what confidence he faces the prospect that on this occasion the court may disagree with the Advocate General?

Lord McIntosh of Haringey: No, my Lords, I have no insight into the minds of those at the European Court of Justice. As a matter of historical fact, the noble Lord is right. The court usually, if not always, agrees with the opinions of the Advocate General.

Lord Crickhowell: My Lords, is it right that other countries are also opposing this action in Europe? Is it not right that it would apply to the first Severn crossing as well as the second Severn crossing? The Minister referred only to the second Severn crossing; they run in tandem. Will the Minister be kind enough to place in the Library the detail of all those tolls in Europe where this practice is followed, and the way in which the VAT is applied? We can then see what is happening in other countries and what is proposed in this country.

Lord McIntosh of Haringey: My Lords, I can undertake to do that as regards this country, or to answer a Written Question if that would be more appropriate. I am doubtful whether we could collect the information for other European countries.

The Earl of Northesk: My Lords, presumably the Treasury has done some research on how much such charges would cost the UK taxpayer. Perhaps the Minister can share that information with us.

If the proposal is upheld by the ECJ do the Government intend that relevant local authorities should be forced to levy an additional 17.5 per cent on their bridge tolls?

Lord McIntosh of Haringey: My Lords, it is not a question of how much it would cost the taxpayer. If we take the issue literally, I assume that both local authorities and publicly and privately owned toll roads and bridges would wish, if they could, to increase their charges to cover the VAT so that it would cost the taxpayer nothing. Those are matters which will have to be dealt with on a case by case basis.

I am not sure whether it is clear to noble Lords who talk about the cost to this country, in particular to business and industry, that all commercial traffic and passenger vehicle traffic by business motorists would be able to recover their VAT by keeping their receipts and entering them in their VAT returns.

Lord Mackay of Ardbrecknish: My Lords, may I seek to be helpful to the Minister? Perhaps he can suggest to his right honourable friend the Chancellor of the Exchequer that additional charges resulting from a judgment of the European Court about VAT on the Forth road bridge used by many of his constituents would not go down very well in that part of Scotland.

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Lord McIntosh of Haringey: My Lords, the spoon with which I have supped with the noble Lord does not grow any shorter! I am sure that the Chancellor of the Exchequer is well aware of these matters.

Inter-Governmental Conference: Nice

2.52 p.m.

Viscount Waverley asked Her Majesty's Government:

    When the agenda will be agreed for the Inter-Governmental Conference in Nice.

The Parliamentary Under-Secretary of State, Foreign and Commonwealth Office (Baroness Scotland of Asthal): My Lords, we expect the European Council in Feira on 19th and 20th June to confirm that the IGC agenda should remain focused on the institutional changes necessary for enlargement, and that negotiations should be completed this year. In addition, the presidency will report on discussions so far and recommend the inclusion of a few additional agenda items. We expect these to include areas such as reform of the European courts, the composition of the Community's other institutions and bodies, and closer co-operation. We are content to see these issues on the agenda.

Viscount Waverley: My Lords, how can the United Kingdom's European participation be considered to be impacting centre stage when it quite manifestly is not, given our current approach? Why is our reputation with our partners, the Commission and, most importantly, the British electorate seemingly being diminished by a creeping on-off engagement without consistent arguments being articulated before what will be the most draconian Summit since Maastricht?

Baroness Scotland of Asthal: My Lords, I am surprised that the noble Viscount should so describe the IGC. I cannot join with him in his assessment. Our reputation has not been diminished. Britain has very much gone to the core of Europe. We are extremely well respected. The IGC agenda is clear. That agenda has been well established. It has been agreed. Provision was made for the inclusion of a few related additional matters. These have now been thrashed out.

This IGC is very much on course. We are dealing with precisely the issues that Britain wanted to be dealt with. We are confident that we shall be ready and able to deal with those issues in a productive way.

Lord Willoughby de Broke: My Lords, is it correct that the French Government wish to put the charter of fundamental human rights on the agenda? Do the British Government agree that that should be part of the treaty?

Baroness Scotland of Asthal: My Lords, I hope that we shall have an interesting debate on the charter of

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rights on Friday when I am sure I shall be able to expand more fully on the subject. I make clear that Her Majesty's Government welcomed the opportunity to raise the visibility of those rights. The charter should preserve the legal certainty, including full consistency with the ECHR, stick to existing rights, and be consistent with other EU policies and objectives. At present we do not see that this charter should be anything other than a declaratory charter. We think that this is the best way to raise visibility while maintaining legal certainty.

Lord Stoddart of Swindon: My Lords, the Minister will surely agree that the agenda that she would favour is completely different from the agenda that Mr Joschka Fischer wants. Has my noble friend read his speech of 12th May to Humboldt University entitled From Confederation to Federation? It sets out clearly the German point of view--it is not a personal point of view--towards a country called Europe stretching from the Urals to the Atlantic. Can the noble Baroness emphatically disagree with that view and give some leadership to the other countries which do not see the German-French axis vision of Europe as they do?

Baroness Scotland of Asthal: My Lords, Mr Fischer made clear that he was speaking in a personal capacity, and not as Foreign Minister nor as a representative of the German Government. We welcome his contribution to the debate on the future of Europe, which sets out some familiar views. We can support some elements of his speech. For instance, we support his emphasis on the need for early enlargement and his recognition that political integration should not go against the grain of the national institutions and traditions. But clearly we do not share his view on the EU constituent treaty or a full parliamentary federation. We want a united Europe of states not a united states of Europe. It is right to remember that France, too, has welcomed his view and expressed interest, but no more.

Lord Howell of Guildford: My Lords, I fully understand that the agenda for the conference has not been finalised, let alone the agenda for the subsequent treaty of Nice. However, is the Minister aware that some of us are beginning to feel a shade misled by the propaganda about the nature of the conference--not by the noble Baroness, I hasten to say, but by government spin generally? We have been told again and again that it is a tidying-up conference; that it is tightly focused; and that it is all about the Amsterdam left-overs and the housekeeping needed for enlargement. But it has become plain that it is a conference about the major issues affecting the future of Europe and its shape. It is becoming a Christmas tree on which everyone hangs their favourite cause in relation to European reform.

The Minister referred to a tight focus for the conference's agenda.

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