European Union Bill

My Lords, the most important theme emerging from the contribution on this side of the Committee to the debate tonight is the need for the European Union, like any businesslike and serious organisation, to retain the capability for flexibility in responding to what are unpredictable and therefore, necessarily, unpredicted situations. That is enormously important and it is quite clear that the Government are, by contrast, saying of the European Union that we should remain rigidly anchored on the existing constitutional arrangements until and unless, by some enormous shift involving a public referendum in this country, there is a sudden, seismic change. That is the fundamental difference between the perception on this side of the House and that on the other side of the way that the European Union ought to be conducted. Many of us on this side have the considerable suspicion that, because the Government’s attitude is so unrealistic in relation to what would be the requirements of any organisation that expected to survive in the modern world, there is actually a Machiavellian plan deliberately to make the EU inflexible, to cause crises and conflicts and, at some dramatic interlude, to stymie the whole of the EU. We know that many members of the Conservative Party have had that agenda for a long time. There is a particular issue of flexibility facing me at the moment. As I understand my noble friend, he has suggested that in the interests of the House and of making rapid progress, we should debate in one session all the amendments from Amendment 23C to 23L. I understand that they cannot be formally moved together en bloc, but my noble friend’s suggestion was that they should be discussed and debated as such and I am happy to do that. If I receive so much as an eyebrow signal from either Front Bench that I am doing the wrong thing, I will sit down and try to address the House again under Amendment 23L, which is what I was intending to do. Unless I receive such a signal, I shall proceed to make a few remarks about that amendment against the background of the theme that I have just set out, which is the unifying theme in all the debates that we are having on this clause. Amendment 23L deals with the issue of piracy. As my noble friend rightly says, this is a grave and serious problem that does not merely affect east Africa but, unless we get this right, could affect large areas of the world because, if piracy is shown to be something that pays and makes a lot of money with impunity, others will inevitably get involved in it. We will return to a situation that we thought we had left behind in the 19th century when the Royal Navy, above all, in collaboration with the navies of other civilised countries succeeded in more or less extirpating piracy, which had been such a threat to lives, to civilisation and to developing world trade, and I do not think anyone wants that to happen. My noble friend Lord Liddle sensibly said—I agree—that there may be great advantage in trying to review and standardise the terms of engagement of our various naval units and fleets that are off the coast of east Africa at present. It is slightly absurd that we have three task forces there—one American, which we are supporting, one NATO and one EU. That does not seem a sensible way of making progress, but I leave that matter aside. I agree with what my noble friend said about the probable need for greater operational co-ordination. I am not sure whether that raises the issues of the Bill in relation to changes in the competences or powers of the European Union, but I have a suggestion to make to the House. I listened with respect, as I always do, to the noble Lord, Lord Wallace, when he commented the other day that, by saying that in future the EU might need some particular power and it would not be sensible for us to deprive ourselves in advance of the opportunity of granting the EU that power in the interests of us all, I was raising hypothetical issues. He said that I did not actually come up with concrete scenarios or specific cases. I hope that I have his attention now because I am coming up with just such a specific scenario. Anyone with a business or economics background will always look at the demand side before they look at the supply side, on the grounds that the supply side emerges only when there is a demand for something. I put it to the Minister that one of the big problems with piracy is that, on the demand side, people are prepared to pay the money. That issue has not been addressed at all. I have to tell the House that every week ransom payments are paid amounting to millions of pounds. Sometimes they are paid through banking channels, and sometimes they are paid literally with cash dropped out of chartered aircraft on to the coast of Somalia that is then picked up by pirates. As a result, some individual or ship is released from imprisonment by the pirates who have illegally hijacked them. This happens the whole time; I repeat, it happens every week. Every year tens of millions of pounds are paid in this way; indeed, the figure may well be getting into hundreds of millions in the course of a year. I have spoken about this to underwriters in the City of London, who confess that to pay ransoms to pirates is becoming quite a normal part of their business. It is clear that this river of money is available for pirates, and there is not much of a downside. They might get arrested and sent to Kenya; they do not know how long they will spend in jail there, but they will not be shot. The pirates discovered long ago that our rules of engagement are such that you do not get shot unless you shoot first. One or two people made mistakes at the beginning, but pirates have not made that mistake for a long time. So there is not much of a downside and the upside is a vast amount of money. Piracy will continue until this cash flow is brought to an end. That will happen only when Governments decide to take powers to make these payments illegal and to enforce such measures. We already have legislation in place; I am thinking of the money-laundering regimes and the criminal assets seizure regimes that exist around the world and which could all be applied, if there was sufficient political will, to the problem of piracy to interrupt these enormous cash flows, but that is not happening. There is a great perversity in this; from the point of view of underwriters, in each case there is a conflict between the short-term interests of certain individuals, groups or companies and the long-term interests of society. That is the classic conflict that we encounter in human affairs, and it is very striking in this context. In each case, a ship owner or underwriter will prefer to pay a ransom of £2 million, £3 million or £5 million rather than lose a ship which is worth £50 million. So he will pay the ransom and the underwriters—as long as the premium rates for this kind of risk increase such that it still remains a profitable business—do not mind so much if the costs involve claims for ransom payments from time to time, because over time they will make money. There is a big problem, and it will be resolved only when Governments take action. It is not enough for one Government to take action; by definition, many ships will be owned in one place, chartered to a charter party in another country and insured on the third party. It is essential, if we are to make progress on piracy, that there be an international agreement. It would be ideal if 193 countries—I think there are 193 members of the United Nations—or the 150 or so countries which have coastlines and coastal states all agreed to adopt a regime which would constrict and effectively bring to an end ransom payments to pirates, whether for ships or individuals or other assets. However, getting world agreement is extraordinarily difficult. One reason we set up the European Union is because it is much easier to make progress with a limited number of countries sharing a set of values and the same level of socioeconomic development than it is to try to make progress with the world as a whole. That was a perfectly respectable reason for setting up an organisation such as the European Union. The European Union might well want to take a more active and effective line in dealing with piracy. For that purpose, because of the perversities I have mentioned, it will be necessary to have legislation which applies across the European Union. It will be necessary for the European Union to take new powers in this matter. I see the noble Lord, Lord Wallace, scowling at this. Perhaps he does not like the idea—I have come up with a concrete, precise scenario and he has to address it. However, this is a serious possibility; indeed, it would be a very desirable scenario to develop if we decided as a Union to take a strong line on this. What is more, if the European Union decided to take the initiative on this internationally, we would have much more influence with the United States, China and other major players in the world, which obviously have a great interest in world trade and do not want to increase the costs of world trade through accepting the burden of piracy, than if we simply took action as an individual state. In that context, it would be necessary for us to be credible and to have powers of enforcement. It would be necessary for us to take action under Article 48(6), which provides for the capacity of the European Union to take decisions more rapidly, using unanimity, which do not involve the traditional long-winded method of constitutional change. The noble Lord, Lord Wallace, has a lot of difficulty in responding to these debates, but not because he is not a man of first-class intellectual ability, which he certainly is. Nor is it because he does not know anything about the European Union, on which he is an acknowledged expert. He is on a bad brief because he is a member of this Government. He tends, as anybody in such circumstances might be tempted to do, to set up an Aunt Sally and attack that, rather than defend himself against the arguments that are being made. Very few people on this side suggest that there will be frequent requirements for major constitutional changes—not at all. We have been constantly told by the noble Lord in this evening’s proceedings, and previously on the Bill, that it will be only every few years or once in a month of Sundays that there has to be constitutional change in the European Union. There is no great desire for any constitutional change on the continent at present, so it will be quite a long time after the treaty of Lisbon that anybody wants to go through that again, with an intergovernmental conference and so forth. That is perfectly true. However, I am talking about Article 48(6), which provides for change without going down the intergovernmental conference route. That is a very real possibility for dealing pragmatically with issues and challenges that arise, such as piracy and many others in the areas of immigration, the environment and all those that my noble friend has talked about this evening. It is necessary for the Government to address that. Do they seriously want to deprive themselves of the opportunity to use these limited powers for some specific purpose, such as might arise in the case of piracy? They could be in the ludicrous and humiliating position of saying around the table in the Council of Ministers, ““This is an extremely good idea. This is in the interests of the people of Europe, the people of the United Kingdom and the world—world trade, world peace and so on. I am awfully sorry but I cannot agree to it. We cannot have a referendum at present. Parliament has been going for two or three years and the Prime Minister would not accept a referendum on something. We cannot have a referendum for a long time—maybe not in the next Parliament. Sorry, we are out of this. I have to leave the room and cannot go along with this proceeding at all, whatever its merits””. That is the position to which this country would be condemned if the Government force the Bill through Parliament unamended. I hope that, even at this 11th hour, the very experienced and knowledgeable noble Lords on the Front Bench opposite will think again carefully about this issue.