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Future EU Finances and Own Resources

I do not know what the hon. Gentleman means by ““more and more money””. Spending has slightly exceeded the 1 per cent. formula, but not by very much, so we are discussing a consistent pattern of spending. Of course, there needs to be audit controlat the level of both national Governments and the Commission. The second item that will repay more attention than hon. Members have so far given it is one of the new innovations in the European budget—the globalisation fund. At first sight it is an attractive idea, and it may prove to be a useful innovation, if it heads off some of the European countries that are moving in the direction of economic nationalism. If the measure persuades those countries to be less protectionist by providing funding for worker retraining, it is surely desirable, but we must be a little bit cautious. There have been attempts to set up trade adjustment funds in different countries over the past 30 years. I conducted some work on that point in the late 1970s and early 1980s, with particular regard to the United States, where a similar fund was set up in the mid-1970s. That fund ran into all kinds of problems, not least because some workers asked, ““Why should people be compensated because of trade competition, whereas other workers who have suffered from technological change or a collapse in markets should not be compensated?”” The political problems and problems of equity that arose were serious. There was some extremely unhelpful gaming behaviour, whereby industrial pressure groups secured trade protection in order to negotiate it off against money from the trade adjustment fund, and it is possible to envisage that kind of behaviour creeping into the European Union. The globalisation fund needs to be watched careful, although on balance it should be given an opportunity to prove itself.