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European Union Economic Governance

Let me begin by congratulating my hon. Friend the Minister on his very full opening speech. I want to say a few words about one or two things that perhaps did not creep into his remarks. I should like to pay a compliment to the President of the European Union; I suppose that he does not often get that in this place. The words in his report are very clear about what he was trying to do—to put in place a new mechanism. That is what he was charged with doing by the European Council, and that is indeed what he did. It will be no surprise that the President of the European Union should seek to discharge that duty by putting in place a whole raft of new measures giving new powers and responsibilities to the European Commission. The Minister helpfully set out those new powers in the Government's explanatory memorandum. That makes it clear that the European Commission, whether we say that it has new responsibilities, new roles or new powers, is going to be very busy giving a good going over to this country's economic performance, reaching public judgments that could well have an effect on our economic reputation. It sets a scoreboard for how well the country is doing, and judges the country by that scoreboard. It carries out reviews and investigations and sends delegations, and if the country in question is not responding appropriately, the Commission has the power to recommend to the Council that that country be placed in the excessive imbalances procedure—something that I think the Minister did not have quite enough time to mention. Whether one regards that as a sanction depends on an interesting choice of language. In my previous career as a member of the Bar, I never thought to console a prisoner who had just been sentenced to immediate custody by saying to him, ““Well, at least you didn't get a fine.”” The excessive imbalances procedure could well be borne in mind by those who frame economic policy and wish to avoid such a consequence. Other Members will have far more experience of financial services and the markets than me, but I do not think that anybody in the markets would be dancing with glee at the news that the country was just about to be placed under such a procedure. This is all down to the very wide range of new responsibilities of the European Commission, which is being allocated a much more intrusive role by this document. The alternative argument is that it is a good thing that this is happening; we heard shades of that from the Labour Front Bench. However, how much confidence can we place in the economic management and judgment of the European Commission, considering matters starting with its rather cavalier treatment of recommendations for the European budget in the current economic circumstances, and going all the way back to the fudged criteria for European economic and monetary union? Even if one does have great confidence in the European Commission, there are bigger questions that should loom in all our minds. To whom is it accountable? Can we ask it questions? Can we hold it to account in this House, and who does hold it to account? What can the man in the street, the voter, do if he is not happy with the economic criteria that it has fashioned for this country? Ministers should be very careful indeed about the responsibilities that are allocated to the European Commission. I know that there is a choice of language and a judgment to be made, but after looking through the long list of new responsibilities that have been given to the Commission, I think we should be very careful. We have heard talk of surveillance and informal discussions, but Ministers should remember that not all that long ago, justice and home affairs, and the common foreign and security policy, were said to be matters on which Ministers would simply carry out informal discussions between themselves. It was said that they would never come within the purview of European institutions. Today, of course, justice and home affairs are very much within the grasp of European law makers and the European Union, and we now have a European Foreign Minister and a European diplomatic service. Not that long ago, those things were the subject of informal discussions. We should be very careful indeed before setting foot down this path. We should consider the matter carefully this evening and face up to the enormity of the responsibilities that we are placing upon the European Commission.