European Communities (Finance) Bill

My Lords, I am grateful to all noble Lords who have contributed to this robust debate. The fact we are restricted solely to Second Reading concentrates the mind wonderfully, and that is why such forceful speeches were made on the issues raised by the Bill. I emphasise that the Bill represents a settlement and a future for Europe which is promising, fulfils the requirements of the United Kingdom and asks noble Lords themselves some serious questions, as well as the ones they have addressed to me. First, there was a great deal of emphasis on the problems of the CAP—started by the noble Lord, Lord Waddington, who made his usual forthright contribution. He of course knows that the Government are as one with him on the need for far-reaching reform of the CAP. That remains an important priority for the Government. Nor do we fail to recognise the challenge this represents, a challenge faced up to by previous Conservative Administrations, who found themselves unable to cope as adequately as we have done with these issues. Let me make the point. The CAP budget is declining. In line with the Brussels ceilings agreed in 2002, the budget commitments for agriculture are on a downwards trajectory. They will be 7 per cent smaller in real terms in 2013 compared with 2007. In the current financial perspective, the CAP accounts for 43 per cent of the EU budget, compared to 56 per cent in the budgetary framework agreed in 1994. From the force expressed in the speeches from the other side—not just by the noble Lord, Lord Waddington, although he made an excellent start, but reinforced by the noble Lord, Lord Pearson, and again by the noble Baroness, Lady Noakes, to say nothing of the noble Lord, Lord Stoddart—anyone would think that the CAP monster was maintaining itself with the same force that it had done in the 1980s and 1990s and that there was no change at all. The problem with the analysis of all the positions on the opposition Benches is that it is an analysis of a static position, when Europe, European economies and the British economy are very much in a dynamic relationship. I want noble Lords opposite to recognise that there are real developments in the present position. The noble Lord, Lord Waddington, suggested that we were surrendering our rebate for nothing—that nothing was being gained from that at all—and that the British negotiating position had been a complete failure, a position reinforced in fairly trenchant terms by the noble Baroness, Lady Noakes. How is it, therefore, that UK and French net contributions will be in rough parity over the next period, with France’s net contributions rising twice as fast as those of the UK? Does that suggest that the British Government are being rolled over while others exploit the so-called weaknesses that we displayed? Far from it. That was the achievement of a real recognition of what should be fairness within Europe. Of course, we have not gone far enough. We all recognise that aspects of the budget are quite unacceptable. My noble friend Lord Barnett made a plea for clarity and for the Government to make things easily understandable for Parliament and for the general public. I entirely sympathise with that. The strive towards transparency, towards making sure that the accounts are clear and that the British contribution is clearly analysed, is a determination of Ministers each time the issue arises. We all recognise that the failure of the European Court of Auditors to clear anything except a percentage of the budget is quite unacceptable. Let me say that the percentage of the budget that is being cleared by the Court of Auditors is rising significantly at present, but it is a rightful criticism that it is unacceptable that resources on that scale should be expended without clear analysis of the budget. Of course we have reforms and a reform agenda to pursue in Europe. However, the position opposite seems to be not so much about reform but about how we can withdraw. When the noble Lord, Lord Pearson, talks about his noble friends, he is talking about his noble friends in three parties: his own, that of the noble Lord, Lord Stoddart, and that of the noble Baroness, Lady Noakes, who is in a slightly more significant party than him.