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Debate on the Address

My Lords, I thank my noble friend Lord Howell of Guildford for his generous introductory remarks and your Lordships and all the staff of the House for their extraordinary helpfulness to a new Member. We are approaching the 50th anniversary of the Treaty of Rome, with another treaty on its way. It seems presumptuous to comment on these treaties in the presence of such eminent authorities as your Lordships. I must also observe the convention of avoiding controversy in a maiden speech, which is not easy when the debate is so polarised. I have been involved in that debate for some years, mainly, but not exclusively, on the euro-critical side—to declare a possible interest—and, from my experience, I believe that it is less polarised than it is usually portrayed. There are certainly some who interpret every event as a reason for more Europe and others who interpret every event as a reason for no Europe at all. But the less vocal and less political majority just want reform. Speeches about reform have been two a penny, as have predictions of life-changing success for each new European initiative. Noble Lords will recall the Cecchini report, which predicted that the single market would raise Europe’s growth rate to 7 per cent and eliminate unemployment. The Lisbon agenda was going to turn Europe into the world’s leading information-based economy. The Laeken declaration even promised to re-examine the division of powers of the member states. But none of these hopes or promises materialised. Popular disillusion must have been largely responsible for the defeat of the constitution in two recent referendums. Those defeats came as a shock. The European leadership’s first reaction—to call for a period of reflection—was a wise one. For a few months it seemed conceivable that genuine reform might at last prevail and that a revised treaty might frame a looser-limbed structure that would be more user-friendly to voters—perhaps attractive to Norway and Switzerland and better able to accommodate Turkey. But that sort of radical change needs a determined national champion. Sadly, none emerged. The centralisers recovered their confidence and carried on as though the referendums had not happened. The flow of regulations and directives resumed, some of which were highly sensitive, such as blocking the deportation of foreign criminals, and all were expensive. We have Commissioner Verheugen’s word that the administrative cost of EU regulation has reached a staggering €600 billion a year. To put that into perspective, that is equal to the combined Dutch and Austrian economies. In March next year, the Berlin declaration will relaunch the constitution, which will probably be little changed from the defeated one. It is tempting to succumb to treaty fatigue, to accept that the process is unstoppable and to settle for a few limited negotiating trade-offs. But we cannot go on like this. This is not the 1960s. International tariff cuts have deprived the regional economic blocs of their original purpose. Manufacturing has dispersed geographically and been outstripped by completely globalised services such as finance, communications and design. Massive new national economies have entered the arena. The qualities of a successful society were identified in a famous speech by Pericles in Athens 2,500 years ago: flexible response to surprise; openness to all comers; and the full engagement of the people. The architects of the constitution cite another part of the same speech with admiration, but they do not seem to have reached that passage—the treaty that they produced would have done nothing to reconnect the Union with voters or to improve its adaptability to change. The EU has considerable political achievements to its credit, such as the rehabilitation of its former dictatorships and the encouragement of higherlegal and environmental standards in the former Soviet satellites—and elsewhere—but centralisationis no answer to the economic challenges of the21st century. The Commission expects that Europe's share of world GDP on its current course will fall to little more than half its present level in our children's lifetime. We cannot just resign ourselves to failure on that scale. Decline is not inevitable. Look at the City: it has not narrowed its vision to the region; it sees Asia more as an opportunity than a threat. Helped by a light domestic regulatory touch, it has become the financial powerhouse of the world. Few strategic developments should alarm us more than the EU’s misguided action plan to impose a vast and cumbersome regulatory system on London's sophisticated wholesale markets. Nothing could expel them quicker. The EU’s response to the rise of Asia has been essentially defensive. We had the bra war, then the leather boot war. The farm lobby played a large part in the failure of the recent world trade talks. Presumably, those events were privately resisted by British and other liberally minded representatives, but all an outsider sees is the pan-European result: protectionism. Rival visions of the purpose of the customs union—what we used to call the Common Market—are causing concern across Europe. Is it there to promote competition or is it, as France prefers, to shield producers from global forces? Should regulation be cut or proliferated in pursuit of integration as an end in itself? That conflict of ideas is divisive within as well as across countries. It plays into the hands of blocking minorities standing up for special interest groups. Those who suffer the most are those in Africa and the rest of the third world, who are denied access to our markets, together with the least well-off in our society. In this country, there is now a strong business consensus for reform but there is no consensus about how that could be achieved in the context of the EU structure. That question would definitely take me into controversial territory and I have detained your Lordships enough, so I must leave that to another occasion.