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EU: Single Market (EUC Report)

My Lords, it is entirely appropriate that a Freeman should introduce the debate on the four freedoms of the single market. I congratulate the noble Lord, Lord Freeman, and his colleagues on doing so and on producing this report from Sub-Committee B. I have always been a fan—a fanatic—of the single market. The reason I am a fanatic is that I believe that the central message when explaining Europe to our friends and colleagues and the electorate is to say that the benefits of the single market are considerable. That is why we should apply ourselves in the rigorous way we often do to making sure that that single market comes to fruition. Of course, we will never complete the single market because it is the nature of markets continually to change. That is why we need to be athletic and able to move from time to time to introduce and be aware of that to open those markets up, some of which are threatening to close. We would have got over a lot of our troubles in recent years about the divide on Europe if we had explained that, as the report states, the market brings enormous opportunities for consumers and citizens—who in the end are our goal—and also for business people. At the moment, business people fear that they are obstructed. I sometimes think their obstruction is less real than imagined or is encouraged by the Eurosceptics who so often tell people that Europe is a place of danger and a pitfall of one description or another. I then ask myself why any British business should penetrate it and get stuck into it. There ought to be a political consensus on us all being devotees of the single market. I note today that the Back-Bench speakers—and I too am an intruder on Sub-Committee B—have all been from this side of the House, other than the noble Lord, Lord Bradshaw. The best thing the noble Baroness, Lady Thatcher, ever did was to sign the Single European Act in 1986. I believe she knows that. We should try to devise that political consensus which takes us forward on the benefits that will come from that which will be enormous for everyone. For instance, we should explain the single currency—which is dealt with in a strange way—by saying that every good market has a single currency attached to it. We should explain that we have a single market in the United Kingdom, which is why we have a single currency called the pound in the four nations of the United Kingdom. The theory can be the practice for all purposes for businesses in Europe and also for British businesses. I congratulate the noble Lord, Lord Freeman, and his colleagues on identifying three areas—energy, telecommunications and financial services. We must ask ourselves whether they are the areas, industries and businesses where British business is pre-eminent, so it will always be to our advantage to clear the bracken that interferes with the single market to help British businesses succeed. The report recommends the unbundling of full ownership in the energy sector. Like the noble Lord, Lord Berkeley, I have some reservations about that. While there may not be a European-wide regulator, there has to be some mechanism in all these instances were the national regulators, who are best placed to understand the situation, can be encouraged to have common standards. It is, after all, a single market so common standards have to apply throughout. I listened to what my noble friend Lord Borrie so wisely said. There are other markets outside the single market, which is the biggest market in the world. I have always taken the view that the single market is a forcing house for business and industry within the United Kingdom and Europe that makes us fitter and faster to operate in the wider markets elsewhere. I also believe that there are real opportunities worldwide to begin to say that the four freedoms we support within the single market will be beneficial not just within the European Union but worldwide too. We can be evangelistic about those four freedoms. I am also happy that noble Lords have talked about telecommunications and financial services. Small businesses are hugely important. From time to time, there has been a fear that we create and design the single market for big business. In some ways, that is understandable because they are the most likely to reach across the European Union and always have the loudest voice. But perhaps the noble Lord, Lord Freeman, and Sub-Committee B could look at small businesses and the way in which we can disband the idea that a single market is foreign and unhelpful, and at whether we can do more to convert those 99 per cent of enterprises, many of which would be very successful in a single market if they were given the opportunity. The noble Lord, Lord Freeman, also referred to the Lisbon treaty and SMEs, and drew our attention to its difference from the now redundant constitutional treaty. But, in publishing the report yesterday on the Lisbon treaty and an impact assessment, the European Union Select Committee said that it would be concerned if any symbolic downgrading were translated into efforts to depart from the principles of free competition that have formed the cornerstone of the internal market. However, Article 51 of the TEU gives equal weight to the treaty articles and protocols, which I think the noble Lord, Lord Freeman, was worried about, and will remain the same as Articles 101 and 103 of the TFEU. Therefore, the change does not appear to be significant. I know that we must still look at it and be alert to any deviation, but undistorted competition must be the chime to which that we adhere in development of the market. Like my noble friend Lord Borrie, one of my bibles over the years in trying to understand the single market has been the Commission’s ““Scoreboard””. I, too, have been looking at the most recent edition which came out in December 2007. Some noble Lords will recall Mario Monti and other colleagues beginning this process, which from time to time looks at how effectively transposition and infringements are going in the single market. I congratulate my noble friend Lord Jones of Birmingham on his recent trip to the United States—““Go west, young man””; he did. He told them all about undistorted competition, which I was very pleased to hear about. A good point has arisen, which I am sure that my noble friend will have noted. Figure 1 in the most recent bulletin demonstrates that in terms of transposition of directives of the single market, in 1997 we were 6.3 per cent and now we are down to 1.2 per cent. So we are becoming more and more effective at transposing the directives. But there also has to be concern about the quality of transposition and we need to have an eagle eye open to make sure that that happens successfully. I might add that the United Kingdom is down to 1 per cent in terms of transposition, but 14 countries are better at transposing than we are. So we still need to redouble our efforts. The noble Lord, Lord Borrie, has already mentioned the five states which lag behind; namely, the Czech Republic, Portugal, Poland, Greece, and, surprisingly, Luxembourg. There is also the issue of old directives which are yet to be transposed. In Figure 10, 30 are shown for the United Kingdom, which need to be transposed by 10 May 2008. I would also ask my noble friend Lord Jones to look at the infringements. It is very interesting that the United Kingdom still is above average for the 49 infringement proceedings. We stand at 63, so we need to do more. It is interesting that, when one looks at the figures, the highest numbers of infringements take place in environmental, taxation and Customs, and energy and transport legislation. They are all crucial areas of concern to make the single market successful. In conclusion, this ought to be a major task of the Government’s and it should be a major task of this revising House in what we perform, especially through the European Union Select Committee and its wonderful sub-committees such as Sub-Committee B. We too should be fanatical and should be devotees of the single market. I believe that the payback is that our citizens, our businesses and our consumers will realise that Europe has something to offer and will no longer be shrinking violets in this wider single market.