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Future EU Finances and Own Resources

I assure my right hon. Friend that I shall come to that in due course. I have great sympathy with his observation. The Prime Minister’s capitulation was not the last cave-in. The European Parliament added another £2.68 billion to the budget in April. More recently, Budget Commissioner Dalia Grybauskaitë said that EU leaders understated the budget and that the true level over seven years is in excess of £600 billion. The Prime Minister has failed to prevent a huge expansion in the EU budget, failed to ensure that others pay their fair share—France will still pay 20 per cent. less than Britain—and failed to defend the rebate negotiated with such stalwart courage and determination by Margaret Thatcher over 20 years ago. Remember that we are not talking about small numbers. The £7.1 billion extra that we will be paying as a result of the rebate sell-out could have wiped out NHS deficits for a start, with several billion left over. It could have paid for thousands of new nurses in our hospitals, teachers in our schools or police officers on our crime-ridden streets. Giving up that money is a betrayal of hard-working families already struggling with the heavy burden of the Chancellor’s stealth taxes. Giving it up without reform of the common agricultural policy is a tragic lost opportunity—a lost opportunity to remedy an injustice that keeps thousands in Africa struggling with abject and unnecessary poverty. The CAP, as we heard this evening, is bad for consumers, bad for the environment and bad for the developing world. The 2004 Red Book states:"““The poorest, who spend the greatest proportion of their income on food, are hit hardest by an implicit tax on food of around 26 per cent. Even after the benefits for farmers are taken into account, the cost to the UK economy has been estimated at some 0.5 per cent. of GDP””." The consumer association, Which?, has calculated that the CAP inflicts throughout the EU some of the highest costs for food in the world, adding £1,000 to the average family’s annual food bill. And the opportunity cost could be even higher: a report by Oxford Economic Forecasting concluded that redeploying CAP funds to better uses, such as research and development, could boost growth by around 1 per cent. of GDP. The CAP is a pernicious tax on food that hits the poorest hardest. It hits the poor in Britain and the poor in the developing world, more than half of whom depend on farming to survive. The Institute of Economic Affairs estimates that EU agriculture policies reduce food exports from Africa by roughly 50 per cent. The World Bank has concluded that removing barriers to agricultural trade would benefit developing countries by $54 billion. I am sure we all remember the day last year when thousands of our constituents came to see us to seek our help in making poverty history, including campaigners such as Sheila Gallagher, James Catterson and Marie Pearce from my constituency. On that day, it was no surprise that many carried banners stating ““Axe the CAP””, because the unreformed CAP is the single biggest obstacle to trade justice. I think that we were all stunned by the sheer volume of commitment, passion and energy that we witnessed that day, but it was to no avail when the Prime Minister actually came to make the decisions that really mattered at the EU summit in December. Despite their warm words, the Prime Minister and the Chancellor have manifestly failed to deliver CAP reform trade justice. As Neil O’Brien, director of the think tank Open Europe, put it:"““Over the summer, at Live8 and Gleneagles, there were huge demonstrations of public opposition to unfair trade barriers against developing countries. But for all the difference this has made in Brussels, it might as well never have happened. Trade policy is a good example of how the EU gets away with murder…But gradually people are waking up to what the EU is doing in our name. And they should be angry.””" It should make people even angrier that neither the Prime Minister nor his Chancellor has done anything to ensure that the extra billions that we will be paying to Brussels are spent wisely. As my hon. Friend the Member for Shipley (Philip Davies) has pointed out repeatedly, why should we give yet more money to an institution whose accounts have not been signed off by its auditors for 11 years? If the Commission cannot manage its existing multi-billion pound budget, why should we trust it with yet more of the British people’s hard-earned money? It has become something of an annual ritual for the Court of Auditors to refuse to give a positive statement of assurance about the European Commission’s accounts, but we should not let familiarity desensitise us to the seriousness of the problem. If the treasurer of a Barnet gardening club turned up at its annual general meeting to say, ““I can account for maybe a third of last year’s budget, but as for the rest of the money, it could have been lost or stolen—I’m not really sure which””, it would rightly cause outrage, yet that happens every year in Brussels. If accounts are qualified in the business sector, confidence in a company collapses overnight, in which case the management finds itself out on its ear in double quick time. Furthermore, failure to get one’s accounts right in the private sector can see directors facing jail terms, yet that happens every year in Brussels. However, the Prime Minister does not seem to have mentioned that unacceptable state of affairs as he blithely handed over billions of pounds more of our money to the European Union. Back in 1999, when the Santer Commission resigned in disgrace, the Prime Minister promised this House ““root and branch reform””. His promises on tackling EU fraud and waste have proved as hollow as his promises on the rebate and on CAP reform. Nearly a decade later, it is still business as usual in Brussels. Nothing has changed since the investigating committee that brought down Mr. Santer’s Commission reported:"““It is becoming particularly difficult to find anyone who has even the slightest sense of responsibility””." Year in, year out, the Chancellor votes in ECOFIN to discharge the Commission’s accounts without protest, and Labour MEPs vote those accounts through in the European Parliament. Every effort is made to silence those who are brave enough to speak out against that complacency. When Marta Andreasen arrived as the Commission’s chief accountant, she was horrified by what she found. The Commission’s computer systems meant that the large amounts of money could be transferred without leaving any electronic fingerprint. In her words, the accounting systems left"““an open till waiting to be robbed””." The Commission was not even using double entry bookkeeping, which has been in widespread use throughout Europe since the Venetians invented it more than seven centuries ago. It is a basic tool used by businesses ranging from the largest multinational to the smallest corner shop. When Marta Andreasen expressed her concerns to her boss, she was ignored by the person whom the Prime Minister put in charge of achieving the root and branch reform that he had promised. That person was, of course, Neil Kinnock. And when she spoke out publicly, it was Neil Kinnock, who once famously castigated Militant for scuttling round delivering redundancy notices by taxi, who had Andreasen stopped by security officials at Brussels airport and served with a fax threatening her with the sack if she did not keep quiet.