Europe Debate – Referendum
Mr Hain: May I also express my delight at seeing you in the Chair, Madam Deputy Speaker, and respond briefly to the hon. Member for Windsor (Adam Afriyie) by asking whether he has so little confidence that his party will win the next general election that that is the reason for rushing to an early referendum?
I wish to speak to amendments 77 and 78, which I tabled. Amendment 77 would ensure that if there is a referendum in 2017, as the Government propose, it would not fall during the UK’s presidency of the European Union. It would be absurd to have a referendum process running conterminously with our presidency of the EU. Amendment 78 would ensure that there would be a delay of at least 28 weeks—roughly seven months—between setting a date by order for a referendum, and the referendum itself, to allow for full consultation. That point is the burden of my contribution today.
I support the amendments tabled by my hon. Friend the Member for Glasgow North East (Mr Bain) and new schedule 2, to which I have added my name, which also calls for greater consultation. I am worried that Britain may be sleepwalking into withdrawal from the European Union without realising that that would be the result of circumstances created first by the Prime Minister’s referendum timetable, and secondly by the Bill. An exit would be catastrophic for British jobs and prosperity, which is why any referendum, and particularly any date for a referendum as specified in amendments, should be considered only after the fullest possible formal consultation with the British people.
Mr Brian Binley (Northampton South) (Con): Will the right hon. Gentleman explain why an exit would cause the loss of loads of jobs in this country when we have a balance of payments deficit with the EU of some £70 billion?
Mr Hain: I am grateful that the hon. Gentleman raises that issue as I will deal with it later on and call for greater consultation on the matter. Unless the facts are revealed objectively and all organisations are properly consulted, people will not be in a position to make a sensible decision about whether to vote yes or no in the referendum he seeks.
The great flaw in the Bill is that it proposes no such consultation and there is no obligation on the Government to consult anybody. Other than a campaign that will be compressed into a particular period, and the inevitable media focus at the time, there is no sense that everybody will be involved in the great debate on an historic issue for the future of Britain, and indeed Europe. The Bill sets an arbitrary time limit without placing any obligation on the Government to consult. The referendum itself will be the only “consultation”—by bouncing voters into a decision by the end of 2017 or, if the hon. Member for Windsor gets his way, by October 2014.
For example, the business community needs to be properly consulted—paragraph (j) of new schedule 2 specifies how it could be consulted. The CBI, to which specific reference is made in the new schedule, recently reported that eight out of 10 of its members, including roughly the same proportion of its small and medium-sized enterprise members, said that they would vote for the UK to remain a member of the EU if a referendum were held tomorrow. The CBI should be properly consulted, not simply presented with a referendum on an arbitrary date. Nearly three quarters of CBI member businesses reported that the UK’s membership of the EU has had a positive overall impact on their business. They should be consulted, too, so that everybody, whether employees or management, can transmit their view to the wider community.
Sir Edward Leigh: Labour Members appear to want to consult the CBI, Uncle Tom Cobleigh and all, which is fair enough, but are they in favour of consulting the British people in a referendum—yes or no?
Mr Hain: Labour has never been afraid of consulting people in referendums. We have called more referendums in our history than any other party. Labour is the only party that ever called a referendum on the EU—the Conservatives took us into membership of the Common Market without one. Labour Members have never been afraid to consult the people, and we have specified the circumstances in which we would hold a referendum.
Despite CBI member companies’ frustrations with many aspects of EU membership, which, as a pro-European, I share, more than half of them—some 52%—say that they have directly benefited from the introduction of common European standards. Only 15% suggested that that had had a negative impact. A consultation would reveal that and enable it to be properly debated, assessed and considered.
Those CBI members believe that UK influence has helped to maximise the openness of the EU. Some 72% of British businesses believe that the UK has a significant influence on EU policies that affect them.
Bob Stewart (Beckenham) (Con): I would have thought that those points of view would come out in the campaign, so why would we need consultation? Surely, in the yes, no or whatever campaigns, the various interests groups would directly lobby the British people, rather than MPs.
Mr Hain: I have taken every intervention that hon. Members have wished to make and I want to make progress, but I will answer the hon. Gentleman’s point first. As an experienced politician, he, like all hon. Members, knows that, in the din and pressure of a three-week campaign, with all the focus that that brings, it is very difficult to get all the arguments across. We need a proper assessment so that the British public have the chance to make their minds up, free from the influence of Eurosceptic newspapers, which dominate the debate. They should make their minds up on the facts by consulting the CBI, the TUC, the Institute of Directors and other such organisations. Those organisations will want their say, and the way to achieve that is through proper consultation, for which the Bill does not provide.
The City is a significant institution that will need to be consulted, which could be achieved under paragraph (j) of new schedule 2. According to the evidence we have, such a consultation would reveal that the City takes the same view as the CBI—it believes that British membership is positive for financial institutions. Why is the City not being consulted? Are the Government scared of consulting it? Is the hon. Member for Stockton South (James Wharton), the Bill’s promoter, scared of consulting it? Some 84% of Britain’s financial sector executives are strongly in favour of staying at the centre of the EU, according to a survey published in October by TheCityUK. Through a consultation, we could drill down into that and see whether it is a proper assessment.
The financial services sector accounts for 13% of gross domestic product and contributes more than £60 billion in taxes. Nearly 80% of all foreign exchange trades in the EU take place in the City, as do 74% of all interest rate derivative trades. The idea that the City would want to be frogmarched out of Europe is complete nonsense, as a consultation would reveal.
Mr Cash: The right hon. Gentleman has massive pro-European credentials, as he puts it, so will he explain why he voted against the Maastricht treaty Bill on Third Reading?
Mr Hain: I am grateful to the hon. Gentleman for his intervention because I am about to name-check him—and to answer his question.
The City must be properly consulted, as new schedule 2 and amendment 68 would provide, and its concerns, like those of CBI members, need to be understood by the electorate well in advance of a short and compressed campaign so that voters are not bamboozled by newspapers and stampeded into a referendum.
Martin Horwood: The right hon. Gentleman is making important points. I suspect that we probably agree on whether Britain should be in or out of the European Union, but he must accept that we do not really need a formal consultation exercise to find out what the CBI thinks. It said clearly, in a definitive report published on Monday:
“While the UK can certainly survive outside the EU, none of the alternatives suggested offers a clear path to an improved balance of advantages and disadvantages or greater influence.”
The CBI clearly wants us to stay in. Do we really need a consultation to establish that?
Mr Hain: What we need is for the Government to consult the CBI properly, not just stick a copy of its report into the Library. We need a report to Parliament, as amendment 68 suggests. It is a serious report by a serious organisation—
Mr Sheerman: Who would we consult about peace? We are coming up to Remembrance Sunday. In 1914, bad newspaper leaders and bad politicians led this country into war. The European Union has maintained prosperity and peace for all these years—are we going to give that up?
Mr Hain: I will come to that point when I discuss whether we should consult groups such as the Royal British Legion.
Susan Elan Jones (Clwyd South) (Lab): One consultee that my right hon. Friend proposes is the National Farmers Union. As urban areas are, by their nature, in the majority, those of us who represent rural areas are always fearful that the voice of rural Britain will be left out. Does he agree that it is of pivotal importance that farming groups are consulted?
Mr Hain: I do, and I am about to make that point.
As the hon. Member for Stone (Mr Cash) said, I am a pro-European, but I am also a critical one. That is why amendments 77, 78 and 68 and new schedule 2 are important. I am not a Europhile who cannot see that the EU needs reform or who wants integration at all costs. I am a practical European. I voted yes in the 1975 referendum but, as an MP in 1992, I voted no in the House to the Maastricht treaty—with the hon. Gentleman, among others—because I did not think the foundations on which the euro was erected were the right ones. Time has probably proved that view correct.
As Europe Minister over a decade ago, I was intensely frustrated with what I call the Brussels bubble, which is mainly inhabited by Commission officials, small-country Ministers and European parliamentarians. It exists in a world of its own, forming an elite and making the EU increasingly unpopular among its citizens. But—and this is the point of a proper consultation—none of this means that we should pull out, any more than Scottish frustrations with the Westminster bubble mean that Scotland should withdraw from the United Kingdom, or voters’ frustrations with all the major political parties, including Labour and Conservative, mean that they should give up on parliamentary democracy.
We need systematic consultation with a report that Parliament can properly assess before deciding how to proceed. I am sure that the Royal British Legion, if consulted, would have something to say. Just imagine if, at the end of the second world war, Monnet and others had concluded that 80 years of bitter Franco-German hatred made European unity impossible.
The following 60 years of Franco-German reconciliation and EU achievement would never have occurred. That is a matter that organisations, particularly veterans organisations, should be properly consulted upon, under sub-paragraph (j) of new schedule 2. It is incumbent on our generation to find the means to take Europe forward on the global stage, not to retreat into reactionary isolationism.
Amendment 68, like new schedule 2, would place an obligation on the Government to consult on all these matters. It is essential that we do so. The consultation would also be an opportunity to recognise that Europe’s first achievement was to remove the internal tariff barriers that held back growth and prosperity across the whole continent, including Britain. We accepted that, especially with globalisation, our interests were best served by bringing down barriers, which enabled Europe to act as one unit in trade and become a more powerful, if as yet imperfect, force for trade liberalisation under internationally agreed common rules. Again, we could be talking to the business sector and exporters about that, if the Government had the courage. It makes me wonder why they do not. Have they got a reason to be worried about a proper consultation?
Consultation under these amendments would also give us the opportunity to remind everybody—in particular, it would give the older generation a chance to remind younger citizens voting in this referendum, if it happens—that Europe’s success in reconciling once-bitter foes established and consolidated peace and democracy across the EU. It is important that there be proper consultation, that this be assessed and that Parliament have a chance to reflect upon it. For example, EU enlargement, first to Greece, Spain and Portugal—countries that until relatively recently were fascist dictatorships—and now to former communist states in central and eastern Europe that were also under a form of dictatorship, has amply shown how the zone of stability, democracy and prosperity can be extended right across a continent on which more wars have been fought over the centuries than in any other part of the world.
Similarly, with proper consultation—my amendment 78 suggests a minimum of 28 weeks—we could assess the impact of our being part of association agreements with Ukraine, Georgia and Moldova and of the continuing accession negotiations that the EU is conducting with Turkey. I believe it essential that those negotiations succeed, because Turkey is a vital bridge between Europe and Asia, west and east, Christianity and Islam. If we enter a referendum campaign in the heat and din of a three-week in/out squabble, none of these issues will be revealed, and that is why consultation is essential.
Huw Irranca-Davies: Does my right hon. Friend agree that consultation would also allow light to be shone on the work of the Centre for European Reform, which only this month produced 35 recommendations that were very much in line with his comments and none of which, they argued, needed our exit from the EU?
Mr Hain: Indeed, I think the CER does some very good work, and again I hope that under sub-paragraph (j) it will be properly consulted by the Government. It is a serious analyst. By the way, Eurosceptic organisations should be consulted as well under that sub-paragraph.
A series of other organisations, some of them specified in the new schedule, including the Trades Union Congress, should be consulted, so that people can understand that the EU has brought with it policies to extend social, environmental and consumer rights. Without those, and despite the EU’s faults, we would not have as fair a society as we do today. Organisations such as Citizens Advice and the National Council for Voluntary Organisations, specified in new schedule 2, could have their say as well.
Consultation would provide another opportunity to recognise that Europe has its faults but that the remedy is to get in there and argue for a stronger reformed Europe, not for Britain to turn its back and walk away. Although it has become fashionable to criticise Euroland, a consultation would reveal that its productivity per hour worked is far higher than Britain’s. The work force are, sadly, more highly skilled, and public services such as health and transport are superior. Under new schedule 2, whether under sub-paragraph (g) or others, organisations such as the National Council of Voluntary Organisations would be able to express their view and say whether they agree with that assessment.
Consultation would afford another opportunity. The continentals probably have something to learn from our better record on employability and our more flexible market. Equally, it would reveal that we need to acknowledge that our employees are far less protected and subject to much greater job insecurity than those on the continent. Consultation with the TUC and other organisations, including the citizens advice bureaux, would reveal the high social costs of the inferior rights and job security which, sadly, exist in Britain.
Mike Gapes: If there were to be a referendum on the basis that the Government, or at least the Conservative party is proposing, it would be on worse terms in respect of the rights of trade unionists, women and people on maternity leave. It would not be a question of the status quo or leaving. It would be question of a worse position or leaving, as was put forward by the Fresh Start Group and other Conservative Back-Bench groups.
Mr Hain: I agree completely. All that social protection would be dispensed with under the Conservative nirvana.
New schedule 2 and amendment 68 would provide for consultation on the common agricultural policy, a matter that was briefly raised earlier. I would like not only the National Farmers Union to be consulted under sub-paragraph (b) of new schedule 2 but the Farmers’ Union of Wales and NFU Cymru under sub-paragraph (j), because the CAP is wasteful and works against the interests of the world’s poor. However, a Britain on the margins of Europe would not be in a strong position to reform the CAP—I am sure that that would be revealed by a consultation—and nor would it be able to create more sustainable agriculture and rural communities. Without a full commitment to the EU, we will have less influence, too, on determining European negotiating positions in the World Trade Organisation negotiations. I am sure that farmers’ unions and organisations would endorse the position that I have just advanced in a consultation.
If we exited from the EU, we would have less influence on CAP reform. The fact that we are on the border of the rest of the EU means that we are affected by the CAP whether we like it or not. We would disadvantage our own farmers by not having the ability to influence what was going on in Brussels and the policies that flow from that. A consultation would reveal that. Overwhelmingly, farmers’ unions and organisations would favour remaining in the EU. The consultation would reveal the arguments in detail and test them in a way that will not be possible in a short referendum campaign.
Martin Horwood: I agree entirely with what the right hon. Gentleman says about the way our influence on many of these issues would be reduced if we left the EU. However, if I may draw him back to his new schedule, is there not a problem with such a prescriptive list of organisations? If the NFU is included, why not the Soil Association or the Country Land and Business Association? If Universities UK is included, why not the Russell Group or the Gazelle group of FE colleges? If the Association of Chief Police Officers is included, why not GCHQ—that would be topical? There is a problem with having such a prescriptive list.
Mr Hain: I am at a loss to understand what exactly the Lib Dem role is in all this. If the hon. Gentleman looks at new schedule 2, he will see that sub-paragraph (j) provides for “other organisations”, and that includes all the organisations that he mentioned and many more that I am about to mention.
On the question of a proper, concerted approach to the environment in the whole of the EU, the consultation could seek the views of Friends of the Earth, which is mentioned in sub-paragraph (h), the Local Government Association, which is mentioned in sub-paragraph (i), Greenpeace, the Royal Society for the Protection of Birds and the World Wide Fund for Nature. All those organisations would be able to confirm in a consultation that Britain on its own would be unable to guarantee a sustainable future for our citizens. We are so close to the continent of Europe that clear skies, pure water, clean beaches and a healthy environment can be delivered only through co-operation at European level. A consultation on the environment would reveal the case for staying in the European Union and why the Bill is so irrelevant.
I turn now to consultation on other issues. In the past 25 years, the greatest promoters of workers’ rights, women’s rights and the rights of all against discrimination on the grounds of race, sex, sexual orientation, age and disability have been European directives and decisions of the European Court of Justice that have often been forced on reluctant British Governments. There should be consultations with the TUC under sub-paragraph (c), with the National Council for Voluntary Organisations under sub-paragraph (g) and, under sub-paragraph (j), with Age UK, Disability Rights UK, the Equality and Human Rights Commission, Stonewall and a number of other organisations that I am sure would be queuing up to be consulted to reinforce the point that our membership of the European Union is valuable for their members and for British citizens in general.
I would also like to see proper consultation with the people of Wales prior to a referendum being called. I suspect that the Welsh Government would happily organise such a consultation on behalf of the UK Government if the amendment were accepted by the promoter of the Bill. I suppose that the Welsh Government could qualify under sub-paragraph (j), as one of the “other organisations”, but I think they deserve rather more respect than that. Such a consultation would provide an opportunity to show that Wales benefits hugely from the UK’s membership of the European Union. Without the £1.9 billion of EU funds, Wales would be missing £3.7 billion of investment since 2007. For those who need further convincing, that top-line figure breaks down into 6,000 new enterprises and 20,000 jobs. It is this support from Europe’s funds that made possible the highly successful Jobs Growth Wales programme, which created more than 8,000 jobs for young people. A consultation organised by the Welsh Government on behalf of the UK Government would allow that proposition to be assessed. Opponents of remaining in the EU would also be able to assess it. A debate could take place, and a proper report could be presented to Parliament.
Graham Stringer (Blackley and Broughton) (Lab): My right hon. Friend is making a balanced speech, but will he explain how putting £2 into the European Union for every £1 that comes back to us is a sensible use of taxpayers’ money?
Mr Hain: I was discussing Wales, where there is a surplus of £40 per person in relation to the money contributed to the EU, compared with the money that comes back. I shall not go any further into my answer to my hon. Friend, as that would take me beyond the terms of the debate.
A consultation of the people of Wales, organised by Welsh Government, would overwhelmingly endorse our continued membership of the European Union. More importantly, it would put objective facts before Parliament for us to assess. That is what the amendment moved by my hon. Friend the Member for Glasgow North East would provide for.
A full consultation would reveal that the values that the British people have long supported are also fundamentally European values. They are the values of community, solidarity, social justice and cohesion, and a fair chance in life for all. Those British values are also European values, and they are best realised through co-operation with our European colleagues. Consultation under sub-paragraph (j) would allow us to consult the Royal United Services Institute. I think it would say that the idea of Britain pulling up the drawbridge and declaring ourselves alone is nonsense. Anti-Europeanism has no answers to the increasing interdependence of our globe. I am sure that RUSI would endorse that position. I do not speak for it, but it would at any rate have the opportunity through this consultation to express its point of view and it will then be for all of us to make an assessment of it.
It seems to me that we need to emphasise the importance of that to the promoter of the Bill. Why he will not accept these amendments, I have no idea. I have no idea either why the Government will not support them or why the Minister will not support them—unless he is going to surprise me; I hope he does. From the way he is smiling enigmatically at me, it does not look as if he is going to surprise me. I believe that these amendments, however, would enhance the strength of the case for this Bill.
Another opportunity for this consultation would be the laying out of the facts about the consequences for Britain of those who argue that European withdrawal would be replaced by joining the North Atlantic free trade area. If we consulted the CBI, or for that matter the Institute of Directors or independent groups such as the Institute for Fiscal Studies and the National Institute of Economic and Social Research, I am sure it would reveal that British trade with the EU was three times that with North America. We have over twice the amount of trade with Holland than with the major south-eastern economies. The rest of the EU buys three times as many UK exports by value as the UK’s next most important export partner, the US—equivalent to 15% of UK gross domestic product. Again, we would be able to assess those facts. No doubt UKIP and others would make their arguments, but without a proper assessment and without the proper consultation for which we are asking, none of those arguments will have a chance to be assessed in the run-up to the short, concentrated, volatile and highly-charged referendum campaign.
Ian Murray: My right hon. Friend is making a strong case showing why these issues need to be examined in great depth. If he reflects on the referendum that is currently happening for Scotland, he will find that the debate has not risen to the levels he mentions, because we have not had the in-depth analysis of issues surrounding the Scottish referendum. The debate has left so many unanswered questions that the people of Scotland are demanding more information.
Mr Hain: As a Scottish MP of high repute in this House, my hon. Friend presents his evidence with some credibility. He is right that the Scottish referendum process reinforces exactly the case we are putting for these amendments.
Those who want us to withdraw from the EU suggest that we can have our cake and eat it by staying within the European single market to retain the great bulk of our trade, which is with EU countries. Once again, this could be assessed through a proper consultation, as specified in amendment 68 and new schedule 2. Those who want to withdraw first argue that we would avoid the costs of membership, which they denounce as too high; secondly, they insist that EU regulations make our economy uncompetitive; and thirdly, they allege a loss of sovereignty that comes with European political union.
Our amendments would enable us to assess what those arguments amount to and how seriously we should take them. They would provide an opportunity properly to consult all the different groups involved and all the different sources of expertise, which would reveal that the facts are rather different. It would reveal first that the price of Britain’s EU membership is rather more modest than the anti-Europeans would have us believe. The Government contributed £7 billion to the EU in 2012, which is around 1%—
Sir Edward Leigh: On a point of order, Madam Deputy Speaker. Is this a debate about the merits of remaining part of the European Union, or not?
Madam Deputy Speaker (Mrs Eleanor Laing): I have already explained this morning that I am listening carefully to all Members to ensure that they adhere strictly to the terms of the amendments they are proposing. The right hon. Member is in order in the remarks he is making.
Mr Hain: Thank you, Madam Deputy Speaker.
I believe that a consultation would also reveal that the Government contributed £7 billion to the EU in 2012, about 1% of total public expenditure and equivalent to 0.4% of GDP—I am sure that the CBI would have something to say about this, because its report seems to suggest the same thing. Although leaving the EU and rejoining the single market would cost Britain less, it would not be much less. We would need to negotiate a relationship like that enjoyed by Norway, the largest of the nations in the European economic area, which we would presumably join.
Mike Gapes: Will my right hon. Friend give way?
Mr Hain: I want to make some progress so that others have a chance to speak.
A consultation with the Institute of Directors, the CBI or the independent economic think-tanks would also endorse the notion that joining the EEA would cost Britain about £6 billion. Yes, that is about £1 billion —or 17% less than our membership of the EU—but it is still a large amount in comparison and assumes that our EU partners would, after our departure, be in an open frame of mind to accept us back into some kind of trading relationship. I am sure that the CBI and all the other business organisations, including the British Chambers of Commerce, would want to have a say on that.
As members of the European economic area, we would still be bound by the regulations that the anti-EU camp denounce. In return for access to the single market, Norway and all the other relevant countries, such as Switzerland and Iceland, must adopt nearly all European Union legislation relevant to the free movement of goods, services, capital and people, together with laws in areas such as employment, consumer protection, environmental policy and competition.
There would, of course, be the chance properly to assess such a move. A report would be placed before Parliament and we would spend days debating on the Floor of the House whether to accept the report and the assessment. We would also be able to assess one point made by the CBI, which would also have a greater chance to have its say than it would during the compressed period of a short referendum campaign. That point is that we would also be bound by future European law in those areas, even though we were outside the European Union.
Mr Cash: Will the right hon. Gentleman address the question asked by my hon. Friend the Member for Windsor (Adam Afriyie) about the date of 23 October 2014, which has not yet been debated? Does he agree that a referendum on that date would get totally entangled with the Scottish referendum, which will take place only a month before? Furthermore, it is dangerous to choose a specific date, as was the case in 2007 when we had to delay the local elections because of the foot and mouth outbreak. There are a whole stack of reasons for not having a specific date for a referendum.
Mr Hain: As in 1992 and 1993, when the hon. Gentleman and I were on the same side of the argument on the Maastricht treaty, I completely agree with him. His logic on this point is absolutely faultless, even if it often is not on many other European matters.
I believe—perhaps I am wrong—that all the business organisations, if consulted, would take the view of the CBI report and dismiss a customs union as an alternative to European Union membership—the “Turkey option”—as the very worst of all the halfway alternatives, leaving the UK with very limited EU market access and zero influence over trade deals.
Dr Julian Lewis (New Forest East) (Con): The right hon. Gentleman is very gracious to give way when we are so pressed for time. May I invite him to return to the point raised by my hon. Friend the Member for Stone (Mr Cash)? If the setting of an earlier date is such a problem, will the right hon. Gentleman explain why amendment 22, tabled by his own colleague, the hon. Member for Ilford South (Mike Gapes), suggests the date of 2014? Although I was listening very carefully to the scintillating speech made by the hon. Member for Glasgow North East (Mr Bain), I am not sure that I heard him address that specific point. I would be very interested to know whether the Opposition intend to vote for that amendment.
Mr Hain: Although I have much respect for the hon. Gentleman, I invite him to wait and see. He might not even find out today, for all I know; that is not in my hands. If my hon. Friend the Member for Ilford South (Mike Gapes) has the chance to catch Madam Deputy Speaker’s eye, no doubt the hon. Gentleman’s question will be answered.
Consultation under new schedule 2 would reveal that retaining membership of a customs union only would be an inappropriate economic stance for the UK in the modern global economy. The CBI report suggests that, with non-tariff barriers often replacing tariffs as the major obstacle to trade, a customs union would not be sufficient to support Britain’s trading ambitions in the modern global economy, with its complex supply chains, and could limit UK access to EU markets in areas such as services, on which our economy is so based.
Then we come to direct trade. Again, consultation with the CBI, the Institute of Directors and British Chambers of Commerce under new schedule 2 and amendment 68 would reveal that Britain’s trade with countries outside the EU is all conducted under the auspices of trading agreements negotiated centrally by Brussels, as the EU has exclusive competence to negotiate trade agreements with other countries. No EU member state can have its own separate bilateral trade agreements.
If we left the EU, given its trading arrangements with other EU countries and outside the EU, our trading arrangements would likely be determined by individual bilateral negotiations, and we would do so by default on terms governed by World Trade Organisation agreements. As a member of the WTO in our own right, there is no legal impediment to our negotiating such agreements, but we would be in a much weaker position, and a consultation would reveal that as well.
As I think that the CBI would argue, given that its report makes much the same point, if it were consulted and had a proper chance to consult all its members—something that it could not possibly do during a three-week or so referendum campaign, nor would Parliament be able to assess the outcome of that consultation—it would reveal that the UK would become eligible for tariffs outside the EU that the EU imposes on goods that enter from outside the Union. It might also face higher tariffs levied by other countries with which the EU has preferential trade agreements.
A consultation would also reveal that, as the CBI has argued in its report, going it alone through the WTO would reduce market access through increased tariffs on UK goods and services. Refraining from entering into any formal relationship with the EU and simply relying on the WTO rules is not a model that would assist Britain in achieving the global trading role to which we aspire and which we have enjoyed historically.
Mr Baron: I have great respect for the right hon. Gentleman, but I suggest that he does not keep referring to the CBI. After all, it was the organisation that suggested that there would be dire consequences if we did not join the euro.
On the right hon. Gentleman’s wider point about trade, much smaller countries at the heart of Europe, such as Switzerland, do not just survive but thrive outside the EU on the basis of trade. I suggest that he reflect on that, because he is talking down our ability to negotiate trade agreements with the wider world, and doing so is not justified by the evidence or facts.
Mr Hain: I disagree with the hon. Gentleman, he will not be surprised to hear. Norway and especially Switzerland are small countries. Britain is a big country, with an historic global role in trade, diplomacy and defence. The idea that we will be a kind of Norway with nukes seems to be no prescription for Britain’s future, holding its head high in the world.
Phil Wilson (Sedgefield) (Lab): If we are not going to listen just to the CBI, perhaps we should listen to Nissan in my region as well. Nissan has said today that it would be a real mistake to leave Europe and to exit that door. When we consider that it employs 6,500 in the north-east and has 40,000 people in the supply chain, is it not the kind of people we should be listening to as well?
Mr Hain: Indeed. A consultation should be held, and one of the first organisations that should be consulted under paragraph (j) of new schedule 2 is Nissan. With its 6,500 workers in Sunderland, it is a major European car manufacturer. What did its chief executive, Carlos Ghosn, say today? He said:
“If anything has to change,”
“need to reconsider our strategy and our investments for the future”—
that is to say, if Britain were to leave the European Union.
Martin Horwood: Will the right hon. Gentleman give way?
Mr Hain: I will make progress. I have let the hon. Gentleman in a number of times.
The point that I was about to make about consultation is that inward investors, particularly Japanese companies such as Nissan, come into the European Union bringing with them tens of thousands of jobs—direct jobs and indirect jobs—and a great deal of wealth. They come here because they will be part of the single market of the European Union. Again, under new schedule 2 we would be able to consult them. We would be able to consult Ford, which has plants at Bridgend and elsewhere in the United Kingdom. Such companies are in the United Kingdom rather than elsewhere in the European Union because we are members of the EU and part of the single market. We would want to consult them, as well as Sony, Toyota—[Interruption.] We would want to consult Airbus, my hon. Friend the Member for Ogmore (Huw Irranca-Davies) reminds me. That is a really important company, right on the Welsh-English border in the north-east of Wales. It would need to be consulted as well.
Madam Deputy Speaker (Mrs Eleanor Laing): Order. Before the right hon. Gentleman attempts to make further progress, I should suggest to him that although he has been perfectly in order in speaking about consultation, he is in danger of being a little repetitive. It might be as well for him to consider drawing his remarks to a conclusion in the near future.
Mr Hain: I was planning to do precisely that, Madam Deputy Speaker. I regret having taken so many interventions, otherwise I would have concluded already.
On the argument about sovereignty, under sub-paragraph (j) of new schedule 2 we would consult organisations such as the Royal United Services Institute in respect of our membership of NATO. We have given up sovereignty to be members of NATO, but we have gained extra power and influence. We have given up sovereignty—yes, of course we have—to be members of the European Union, but we have gained extra economic, political and diplomatic influence. If we consulted Friends of the Earth and Greenpeace about the environmental benefits that we have gained by having a say in the policies of the countries right on our border on the continent of Europe, it would be clear that we are a key force in determining those decisions.
All the evidence points to the fact that systematic consultation with all the different parts of our society, all the groups in our society specified in new schedule 2, would give us a great opportunity to go into the debate and decide, if we are to have a referendum at all, when it should be. That would be the great advantage which the Bill, unamended, denies us. More importantly, it denies an obligation on Government to consult and, having consulted over a lengthy period, an obligation to come back to Parliament, and for Parliament to have a considered debate rather than to be stampeded into a referendum next year. For all the reasons given by the hon. Member for Stone (Mr Cash) and others, that would be the wrong choice, in my view.
Without my amendment being accepted, setting an arbitrary date some time in 2017 could conceivably mean that the referendum would be held right in the middle of the United Kingdom presidency. Imagine the nonsense of doing that and leaving us in an entirely invidious position—indeed, a laughing stock if a referendum took place during that six months.
I hope the promoter of the Bill will reconsider accepting the amendments, and I hope that when the Europe Minister contributes to the debate, he will back them. If either of them does not do so, I have to ask what they are frightened of. Are they frightened of the facts and the arguments being revealed, and the British people deciding either that they do not want a referendum at all on the proposed timetable or, if they do want a referendum at some stage in the future, that staying in the European Union is the right thing to do?