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European Council

I join the Prime Minister in paying tribute to Rifleman Daniel Holkham and Lance Corporal of Horse Jonathan Woodgate, who have been killed in Afghanistan in the past few days. When one thinks of what Jonathan Woodgate had already been through, it is a reminder of what an exceptionally brave young man he was. It also reminds us that what we ask of our servicemen and women today is exceptional; we need to refresh and renew the military covenant in every way that we can. I also agree with the Prime Minister that we should send a clear message of sympathy and solidarity to the Russian people after the appalling outrage on the Russian metro. We are tragically familiar with such an event in this country, too. I want to ask about three issues that were discussed at the summit—the EU economy, financial regulation and climate change. First, on climate change, the summit rightly said that we must redouble our efforts to achieve the global deal that we all want and push ahead with practical action to cut emissions. The UK has the lowest contribution from renewable energy of any major EU country—just 6.8 per cent. of our electricity and, in total, 2.5 per cent. of our energy comes from renewable sources. Why has so little progress been made? Secondly, on financial regulation, President Obama spoke about a tax on wholesale funding, but, as the Prime Minister has said, the summit conclusions referred to a transaction tax. Would not a tax on wholesale funding rather than a transaction tax be more likely to help keep business here in Britain? The summit conclusions mention the need for greater economic co-ordination. There was some controversy about whether we will end up with any new treaty changes. Should not the Prime Minister make three things clear today? First, any talk of ““economic government”” in Europe is wrong. If he agrees, can he explain why the phrase remains in the French version of the eurozone statement? Secondly, should not we rule out any new treaty change that increases EU control over our economic policies? Thirdly, should not we change the law in the UK so that any treaty that proposed handing over new areas of power from Britain to Brussels would automatically be subject to a referendum, as is the case in Ireland? It is good to see the Prime Minister smiling so nicely, as he does on all our posters—it is good to see him in that sort of positive mood. There are plenty more where they came from. [Interruption.] If he will not put himself on posters, we have just got to do it for him. On economic policy, does the Prime Minister agree with the Europe 2020 strategy document, which says that"““sound public finances are critical for restoring the conditions for sustainable growth and jobs””?" Given that, will he comment on the serious news today that Standard & Poor's has stated yet again that the outlook for Britain's triple-A credit rating remains ““negative”” and that"““additional spending measures will likely be required””" to tackle the debt burden? Europe's leaders talked about a bail-out for Greece, and Portugal's credit rating is being downgraded. However, is not Britain borrowing more this year as a share of our economy than either Greece or Portugal? Did not the same agency that downgraded Portugal's credit rating say last week that Britain's finances are ““vulnerable””? The European Commission says that ““a number of countries”” may have to start tackling their deficits this year. Given that Britain and Ireland have the worst budget deficits in the OECD, to which countries does the Prime Minister think it was referring? On unemployment, business closures and the decline of manufacturing, the UK clearly has some real problems. Why, therefore, does he propose to raise taxes on small businesses and hike national insurance on everyone earning more than £20,000 and on every single new job in this country? The Chancellor admitted in the Budget that there was £11 billion of waste in Government spending, but he proposes to do nothing about it until 2011. Why is not he tackling the waste this year rather than putting up national insurance for hard-working people next year? Have not the Prime Minister and his Chancellor created one of those great dividing lines that they like so much? Labour stands for waste and taxes, and the Conservative party stands for efficiency and aspiration. As the Prime Minister contemplates his national insurance increase on employees and employers, what on earth makes him think that the way to rescue an economy from the longest and deepest recession on record is a tax on jobs that hits every single business in the country? [Interruption.] He says that he wants to talk about Europe—I am talking about our economy in Europe and our failure in Europe. The Prime Minister used to go to European meetings to lecture others about their economic policies; now the reverse happens. He thought boom and bust had been abolished and that he could borrow with impunity; he never prepared for a rainy day. Were not those catastrophic misjudgments? Will not the British people be paying for those misjudgments for another generation? Is not his latest misjudgement to sit back and let the waste, the taxes and the debt pile up even more? Is it not the case that we need a Government who will get on with tackling the waste, stopping the tax rises and securing growth for the future?