European Union (Referendum) Bill

Public Bill Committee, 4 September 2013.

Clause 1 - Referendum on the United Kingdom’s membership of the European Union

Martin Horwood (Liberal Democrat, Cheltenham)

I beg to move amendment 51, in clause 1, page 1, line 14, at end insert—

‘(7) At least 12 weeks in advance of the proposed polling day the Secretary of State shall publish a comprehensive report of the consequences of withdrawal from the European Union on the free movement of goods, capital, people and services between the United Kingdom and the European Union.’.

Joe Benton (Labour, Bootle)

With this it will be convenient to discuss the following:

Amendment 52, in clause 1, page 1, line 14, at end insert—

‘(7) At least 12 weeks in advance of the proposed polling day the Secretary of State shall publish a comprehensive report of the legal and economic consequences of withdrawal from the European Union on the United Kingdom’s participation in the European Union’s external trade agreements.’.

Amendment 53, in clause 1, page 1, line 14, at end insert—

‘(7) At least 12 weeks in advance of the proposed polling day the Secretary of State shall publish a comprehensive report of the economic consequences of withdrawal from the European Union on the representation of the United Kingdom at the World Trade Organisation.’.

Amendment 54, in clause 1, page 1, line 14, at end insert—

‘(7) At least 12 weeks in advance of the proposed polling day the Secretary of State shall publish a comprehensive report of the environmental and economic consequences of withdrawal from the European Union on the representation of the United Kingdom at the United Nations Framework Convention on Climate Change.’.

Amendment 55, in clause 1, page 1, line 14, at end insert—

‘(7) At least 12 weeks in advance of the proposed polling day the Secretary of State shall publish a comprehensive report of the consequences of withdrawal from the European Union for the competencies exercised by the European Union that are identified in the Government’s Balance of Competence Review as appropriate.’.

Amendment 56, in clause 1, page 1, line 14, at end insert—

Amendment 57, in clause 1, page 1, line 14, at end insert—

‘(7) At least 12 weeks in advance of the proposed polling day the Secretary of State shall publish a comprehensive report of the environmental, legal and economic consequences of withdrawal from the European Union on the United Kingdom’s participation in the EU Emissions Trading Scheme.’.

Amendment 58, in clause 1, page 1, line 14, at end insert—

Amendment 59, in clause 1, page 1, line 14, at end insert—

Amendment 60, in clause 1, page 1, line 14, at end insert—

‘(7) At least 12 weeks in advance of the proposed polling day the Secretary of State shall publish a comprehensive report of the legal and judicial consequences of withdrawal from the European Union on the United Kingdom’s participation in Eurojust.’.

Amendment 61, in clause 1, page 1, line 14, at end insert—

‘(7) At least 12 weeks in advance of the proposed polling day the Secretary of State shall publish a comprehensive report of the consequences of withdrawal from the European Union on the United Kingdom’s participation in the Schengen Information System.’.

Amendment 62, in clause 1, page 1, line 14, at end insert—

‘(7) At least 12 weeks in advance of the proposed polling day the Secretary of State shall publish a comprehensive report of the consequences of withdrawal from the European Union on the United Kingdom’s participation in the European Arrest Warrant.’.

Amendment 63, in clause 1, page 1, line 14, at end insert—

‘(7) At least 12 weeks in advance of the proposed polling day the Secretary of State shall publish a comprehensive report of the economic and scientific consequences of withdrawal from the European Union on European Union Research and Development funding in the United Kingdom.’.

Amendment 64, in clause 1, page 1, line 14, at end insert—

‘(7) At least 12 weeks in advance of the proposed polling day the Secretary of State shall publish a comprehensive report of the economic consequences of withdrawal from the European Union on European Structural and Investment funding in the United Kingdom.’.

Amendment 65, in clause 1, page 1, line 14, at end insert—

‘(7) At least 12 weeks in advance of the proposed polling day the Secretary of State shall publish a comprehensive report of the economic consequences of withdrawal from the European Union on European Investment Bank funding in the United Kingdom.’.

Amendment 66, in clause 1, page 1, line 14, at end insert—

‘(7) At least 12 weeks in advance of the proposed polling day the Secretary of State shall publish a comprehensive report of the economic and environmental consequences of withdrawal from the European Union on support for the agricultural sector in the United Kingdom.’.

Amendment 67, in clause 1, page 1, line 14, at end insert—

‘(7) At least 12 weeks in advance of the proposed polling day the Secretary of State shall publish a comprehensive report on the potential budgetary contributions by the United Kingdom to the European Union following withdrawal from the European Union.’.

Amendment 68, in clause 1, page 1, line 14, at end insert—

Amendment 69, in clause 1, page 1, line 14, at end insert—

‘(7) At least 12 weeks in advance of the proposed polling day the Secretary of State shall publish a comprehensive report of the legal and foreign policy consequences of withdrawal from the European Union on the United Kingdom’s participation in the Common Foreign and Security Policy.’.

Amendment 70, in clause 1, page 1, line 14, at end insert—

‘(7) At least 12 weeks in advance from the proposed polling day the Secretary of State shall publish a comprehensive report of the legal and defence and foreign policy consequences of withdrawal from the European Union on the United Kingdom’s participation in the Common Security and Defence Policy.’.

Amendment 87, in clause 1, page 1, line 14, at end insert—

(a) Within six months of this Act receiving Royal Assent the Prime Minister will, following a consultation, lay before both Houses of Parliament a report providing details of the powers and competencies held by the European Union under the Treaty on European Union and the Treaty on the Functioning of the European Union which the Government intends to repatriate from the European Union to the United Kingdom;

(b) six months after the report in paragraph (a) being laid before both Houses, the Government will lay a further report detailing what success it has had at securing the powers requested in the report in subsection (1).’.

Martin Horwood (Liberal Democrat, Cheltenham)

It is a pleasure to serve under your chairmanship on this extremely sunny and warm day. We are going to get on to the subject of climate change at some stage and so global warming is a rather appropriate subject.

The amendments in my name are all based on what I think is an emerging convention: to have more informed debates on public policy issues. Debates informed to some extent by work backed by the resources of Government and the civil service, with their expertise and confidential access to information, allow a deep and thorough evaluation to be made. The reports would be presented to Parliament by the Secretaries of State in the relevant Departments but the idea is that they will provide a reasonably objective and civil service-led evaluation of the consequences of withdrawal from the European Union.

Models for that include several documents that have been produced by the coalition Government: for example, the Trident review. That looked for the first time at the real cost-effectiveness of the Britain’s nuclear deterrent and whether that should be upgraded. That exercise aimed not to draw a particular conclusion or to take sides, but simply to examine, with all the resources of Government and the access to information, the real costs and benefits of the Trident nuclear deterrent and the process of upgrading it. That has been a helpful and successful exercise. It was something that both sides in the coalition agreed to, even though they took different sides in that debate. That is the model that I am seeking to emulate.

We have also had the balance of competences review on the subject of the relationship between the European Union and Britain. That is still ongoing and is a mammoth exercise, but it is proving productive. Liberal Democrats and Conservatives alike have identified the opportunities for reform and for pulling some competences closer to national and local decision making, while recognising that some are best exercised at European level.

William Bain (Labour, Glasgow North East)

May I offer the hon. Gentleman yet another parallel with the referendum that will take place next year on whether Scotland remains in the United Kingdom? As he will be aware, we on the Labour Benches have welcomed the work that the UK Government have been doing to set out the consequences if Scotland withdraws from the UK. It is a huge project, an immense work. There are 13 reports touching on everything from macro-economics to the internal market in the United Kingdom. Is that not a parallel for the type of review that he is seeking?

Martin Horwood (Liberal Democrat, Cheltenham)

Yes, absolutely. The build-up to the referendum in Scotland has been instructive. Using the resources of Government to present what should be reasonably objective evaluations of the impact of such moves can sometimes challenge preconceptions.

I have a leaflet that was distributed in April last year called

“The ultimate plan B: A positive vision of an independent Britain outside the European Union”.

It included the rather optimistic statement:

“leaving is easy: The step by step guide to leaving the EU.”

However, if one follows it through, it is actually quite complicated because it involves a UK-EU free trade agreement being presented for approval to the UK Parliament and the EU:

“Once ratified by Westminster and the EU, Britain would then withdraw its representatives from the Council of Ministers, the European Parliament and from other EU Organisations. Financial contributions to the EU would cease at that point.”

That is very optimistic because, as we know, we cannot just cease contributions to the European Union. The relationship that Norway and others have with the EU clearly demonstrates that.

There is quite a lot of misinformation, perhaps on both sides—perhaps there are wildly inaccurate claims being made on the inside of the argument as well as the outside—but the purpose of the amendments is to set an agenda for Secretaries of State to present the real and well thought out implications of exit from the EU to Parliament, the public and the country.

Kelvin Hopkins (Labour, Luton North)

There is constant reference to Norway and what it has to do. Norway chooses to do certain things because its political class has been in favour of EU membership since time immemorial. It is a way the political class has got round the fact that the Norwegian people, very sensibly, do not wish join the European Union. The two things they will not join are the common fisheries policy and the common agricultural policy. If we got out of both, we would make great progress.

Martin Horwood (Liberal Democrat, Cheltenham)

The hon. Gentleman takes us slightly out of order to amendment 67 in the group, which I accept is quite long. That amendment asks that the Secretary of State—I suspect that in this case it would be the Chancellor of the Exchequer—

“At least 12 weeks in advance of the proposed polling day…publish a comprehensive report on the potential budgetary contributions by the United Kingdom to the European Union following withdrawal from the European Union.”

The hon. Gentleman says that Norway chooses its relationship with the European Union. That is true in a way. It could choose to exclude itself from access to the single market, or from all the consumer regulations that guarantee that Norwegian products have access to that market, but there would be fantastic economic consequences. I am sure that Norway is not paying €550 million a year just because it feels like it or just because the political class is so inclined. I am sure any group of politicians looking for budget economies would not pay that amount of money just for the good of their health.

Emma Reynolds (Labour, Wolverhampton North East)

The example of Norway is instructive. In Norway some politicians and public policy makers complain about a democratic deficit because they have what they call “fax democracy” where they are faxed directives from Brussels that they have to implement. Perhaps that could also be taken into account in considering the consequences of withdrawal.

Martin Horwood (Liberal Democrat, Cheltenham)

That is exactly right. I am sure the term “fax democracy” is a turn of phrase. I am sure they e-mail the instructions these days. It is quite extraordinary the extent to which Norway does comply with EU single market legislation. Norway has implemented nearly three quarters of all EU legislation and 99.6% of all single market legislation. It has implemented 1,700 EU directives. Is that what—

Kelvin Hopkins (Labour, Luton North)

By choice.

Martin Horwood (Liberal Democrat, Cheltenham)

Well, it is a choice based on economic necessity. It is based on the need to protect Norwegian jobs and to gain access to European markets for Norwegian businesses. Exactly the same conditions would apply in this country. Norway is currently ranked fourth for implementing EU rules. It is better than the United Kingdom, such is the extent to which it, in good Norwegian, Scandinavian fashion, complies assiduously with what it is asked to do, but it has had no say whatsoever over the development of those rules, as the hon. Member for Wolverhampton North East rightly says. Norway has had no democratic input. Therefore, the democratic deficit for countries that leave and have to negotiate this kind of relationship is even greater than for any member state that feels that it and its citizens are not fully involved in decision making within the Union. That even includes directives quite controversial in this country such the working time directive, which is part of single market legislation.

Norway makes a budget contribution of around €550 million a year. It is calculated on a ratio of European economic area GDP to EU GDP. If that were scaled up for an economy the size of the United Kingdom, we would be paying €4.4 billion into the EU budget. That is a statistic which, during the in-out campaign—when it comes, as I am sure it will—I shall be putting across doorsteps and on the airwaves, although I am sure that people will be prepared to challenge it. Perhaps the hon. Member for Stockton South, whose Bill this is, will put the counter case. We have not heard much from him in this Committee; perhaps he would like to voice an opinion. As I say, statistics such as those will be bandied around. If amendment 67 is passed today we will have a mechanism for having that kind of discussion on an objective basis.

There are other examples, such as Switzerland, which likes to think of itself as very independent and whose financial services sector, in particular, has benefited from being able to write its own rules—although, increasingly, it is discovering that there is no such thing as a free lunch. Life will not always be that easy; it cannot go on writing the rule books itself, but will have to comply with increasingly rigorous control of fraud, transparency and so on. At the request of the EU, among others, Switzerland is having to amend its own financial services legislation.

The hon. Member for Luton North has raised an important point—that Norway and other nations make their contributions by choice. However, that choice is based on absolute economic necessity.

Emma Reynolds (Labour, Wolverhampton North East)

The hon. Gentleman makes an important point. Although my hon. Friend the Member for Luton North says it is a choice, in order to negotiate access to the internal market, Norway has been obliged to take on those obligations. There is no such thing as a free lunch or free access to the biggest internal market in the world.

Martin Horwood (Liberal Democrat, Cheltenham)

That is exactly right. The value of the single market is something that we need to look at comprehensively, quite separately from the budgetary contributions that we are expecting to make to the European Union, should we leave. That is the subject of probably the most important single amendment in this entire group, amendment 56, which says:

“At least 12 weeks in advance of the proposed polling day the Secretary of State”

—that would be either the Chancellor of the Exchequer or, more likely, the Secretary of State for Business, Innovation and Skills—

“shall publish a comprehensive report of the consequences of withdrawal from the European Union for the economy of the United Kingdom.”

There has been considerable debate about the pros and cons of membership. I would have thought that those in favour of withdrawal from the European Union would welcome some mechanism that tries to put such statistics on an objective basis. There has been wide debate about exactly how many jobs depend on European Union membership; some enthusiasts on the pro-European side of the argument have quoted figures as high as 3.5 million. I hesitate to say that they would instantly disappear. However, if we were forced to withdraw from the single market, the scale of jobs linked to trade with other European Union member states—

Kelvin Hopkins (Labour, Luton North)

We have a gigantic trade deficit with the rest of the European Union, to the tune of £1 billion a week and more. That is the equivalent of a million jobs that we export to the European Union, rather than it giving to us. The EU needs us more than we need the EU.

Martin Horwood (Liberal Democrat, Cheltenham)

I am not sure that that is true. I have heard the hon. Gentleman make that point many times on the Floor of the House, as well as in Committee. However, if one imagines what might happen if we were to have less access, or less preferential access, to the single market—if, for instance, there were changes to the rules linked to the development of the eurozone that excluded the City of London from euro trading or carbon trading in the emissions trading scheme—we can imagine that that trade deficit might actually lurch in the opposite direction to the one that he is expecting. There is no automatic rule that says if we leave the European Union the trade deficit is going to get better. The relationships between trading nations such as the United States and China are not always based on being part of the same single market.

Kelvin Hopkins (Labour, Luton North)

The European Union is highly unlikely to implement a trade war against us if it depends on us for a million jobs on the continent of Europe.

Martin Horwood (Liberal Democrat, Cheltenham)

I am not sure that that is right. I do not think that it is at all likely that we will have a trade war in the slightly pejorative way that the hon. Gentleman describes. However, as with the United States and China, it is possible that considerable tension might come into the relationship. Norway and Switzerland do not pose any great financial threat or cost any particular opportunity to businesses in the eurozone or the core of the European Union. Therefore, in a sense, the European Union can be pretty relaxed about its trade relationship with those countries.

However, the EU might be slightly less relaxed with an economy the size of the United Kingdom. Especially in relation to slightly contentious areas such as the City of London and its access to eurozone trading, the European Union might be inclined to play hardball slightly more. There is no reason why there would not be a German lobby in favour of Frankfurt having a slightly bigger role, stepping up to the plate and aspiring to be a financial centre on the scale of London or New York in due course. It might see that as a great opportunity. That potentially is a difficult relationship to manage.

More deeply than that, there is the overall intertwining of the British economy with the European economy. The statistics are pretty staggering. It has been calculated—I realise that this will be contentious for the hon. Member for Luton North—that we benefit to the tune of £90 billion annually. If that is right, that translates to £3,300 per household every year.

The single market gives British companies free trade access to the world’s biggest single market, worth nearly £12 trillion in gross domestic product, and to more than 500 million consumers. Nearly 50% of British trade, worth something between £400 billion and £450 billion a year, is with other EU member states. More than 100,000 British firms export to other EU countries, 94,000 of which are small and medium-sized enterprises. It is often said that the SME sector seems to be the least enthusiastic among business for membership of the European Union but I think that, once the debate becomes better informed, we might see the SME sector discovering which side its bread is buttered on and developing a new enthusiasm for the single market and membership of the EU.

Some 200,000 UK companies trade with the EU every year, one way or the other. More than 50% of foreign direct investment to the UK comes from other EU member states, which is worth something like £350 billion a year. More than 50% of companies investing in the UK cite the UK’s membership of the single market as a core reason for investing in the UK.

There is good evidence that full access to the EU single market makes the UK a magnet for foreign companies locating in the UK. Between 1998 and 2011, 603 major foreign companies chose to locate their European headquarters in the UK. Would that process continue on the same level, not only if there were a new relationship between the UK and the European Union, but if fundamental uncertainty were introduced in the UK’s relationship with the rest of Europe? If someone were choosing a long-term location for their European corporate headquarters, and they wanted to be at the heart of European decision making and business, would they choose London, Birmingham, Manchester or Leeds in the event that we leave the European Union and cast some doubt over our future trade relationship with the European Union? I am not sure that would be the case.

All those are, to an extent, assertions; I am taking the statistics and saying that therefore those things are at risk, because abandoning membership of the European Union would put them at risk. However, that is the whole point of the amendment—to use the resources of Government to place an objective report before Parliament that tries to make more objective some of the evidence relating to the issue.

The European Union’s enlargement has also been hugely economically beneficial to the UK, because that is a process of expansion of the single market. UK exports to the 10 central and eastern European countries that have recently become part of the single market have trebled over the past 10 years to almost £12 billion. Once again, if we excuse ourselves from that process, it is not guaranteed that we will have that kind of benefit from the expansion of the European Union.

Business opinion is very much with us on this issue. Business believes that there is a serious risk in the debate about withdrawal, the referendum and the potential for exit. In the captains of industry poll, 73% of directors from FTSE 350 companies, from the top 500 industrials by turnover and from the top 100 financial companies by capital employed, agreed that leaving the EU would damage the UK economy. If results are restricted to interviews with FTSE 100 companies, the number rises to 85%.

It is important to have some process in place to evaluate the economic impact objectively, using Treasury models and other such resources, and to have some understanding of exactly how the negotiations for withdrawal will take place. I raised that issue in our debate yesterday. For instance, exactly when would the negotiation over the budget contribution take place? If we were going to have to negotiate such a deal with the European Union, would we have to do so in advance of the referendum, so that we had some idea of what we were voting on and what kind of relationship was really envisaged, or would it have to come afterwards, from the weakened negotiating position that that timing would entail? Our negotiators would then be appealing for mercy from the single market and appealing for access for British goods, and would not be negotiating from a position of strength.

I will not go into the same level of detail on the other amendments in the group, as I would use up too much of the Committee’s time, but will touch briefly on each in turn. Amendment 51 would require the Secretary of State—again, that would probably the Secretary of State for Business, Innovation and Skills—to publish

“a comprehensive report of the consequences of withdrawal from the European Union on the free movement of goods, capital, people and services between the United Kingdom and the European Union.”

That report would cover matters such as, for instance, whether there would be some restrictions on the flow of business people from companies based in the European Union to the UK.

At the moment, the process for that is very easy. I have worked in businesses that employed European staff and we can employ European staff in this place without a second thought. Let us think back to the old days and the difficulties with bureaucracy, red tape, visas, and work permit requirements—in fact, that situation still applies to companies that are trying to recruit people from outside the European Union—that had to be gone through; those are serious obstacles to the easy running of a business, especially something such as a European headquarters, in which a high proportion of the staff would probably be European nationals but might not be British nationals. That would give serious pause for thought to investors and companies thinking about locating in the UK. For that reason, we need a report on the consequences of withdrawal for the free movement of goods, capital, people and services as set out in the amendment. The single market implications would be similar to those in the economic report, and there could be some overlap there.

Amendments 52 and 53 are closely linked and concern our relationship with world trade in the context of the European Union. We gain enormously from the negotiating power of the whole European Union—that £12 trillion single economy—with regard to our position within the World Trade Organisation. The common consensus is that WTO talks are grinding rather slowly into the ground, so it is almost more important that the European Union is proceeding with a number of bilateral negotiations for free trade agreements; for instance, right now there are enormous opportunities on offer with the free trade agreement with South Korea. It is not at all clear whether we would still automatically benefit from those free trade agreements should we leave the EU. I am sure that situation could be objectively analysed and reported to Parliament.

More important perhaps are potential future free trade agreements with important emerging economies such as India, Vietnam and Brazil, with the Latin American free trade area, Mercosur, as well as with major existing developed economies such as the USA, Japan and Canada.

Emma Reynolds (Labour, Wolverhampton North East)

Given that the Obama Administration have made it clear that they would like to see the EU-US FTA agreed within two years, by the time we arrive at this point in the procedure—should the Bill become an Act—the EU-US FTA could already be in place, so there could be an objective analysis of what could be lost if we were to leave the European Union.

Martin Horwood (Liberal Democrat, Cheltenham)

In fact, that takes us back to yesterday’s discussion about the overlap of the referendum campaign with Britain’s presidency of the European Union. Can we imagine a situation in which a British presidency was celebrating the signing of the free trade agreement with the United States and simultaneously planning to withdraw from the European Union? That would be an obvious opportunity for negotiators on the other side of all these free trade agreements to say, “We just want to introduce a couple of little exclusions and amendments to this deal; they relate to the United Kingdom, because the UK is on its way out.” They might want to protect their insurance or IT industries and perhaps their creative industries from competition from the UK, which is rather good at such things.

There would be opportunities for negotiators on the other side of the negotiations to introduce new complications and levers with which to extract a deal from the European Union. What incentive would European Union negotiators have at that point to protect Britain’s interests if Britain was intent on leaving the EU, or appeared to be intent on leaving? Perhaps that is negative speculation, but that is why we should have reports such as those envisaged in amendments 52 and 53, which would set out the legal and economic consequences of withdrawal on the UK’s participation in external trade agreements and on our representation at the World Trade Organisation.

Amendment 54 deals with the implications of our withdrawal from the European Union on UK representation at the United Nations framework convention on climate change. In this case, it would be the Secretary of State for Energy and Climate Change who would produce the report. I had the privilege of taking part in the negotiations at Cancun in 2010. It ought to be have been a nice summery winter break, but we were so scared of Daily Mail photographers we were not allowed to go anywhere near a swimming pool or deckchair for the entire conference. We spent all our time in something like an aircraft hangar, negotiating climate change.

The process was very instructive. My then colleague and friend, Chris Huhne—he was a colleague and remains a friend, despite his slight mishaps—played a central role. I hope that his career and his contribution to this place will be remembered. I hope he will be remembered for the roles he played, such as in Cancun, and not for what happened subsequently and the meltdown in his political career. He played a very important role at that conference, effectively performing shuttle diplomacy between the Chinese and the Americans.

I had always thought “top table” was simply a turn of phrase until I saw the various delegates gathered round a table, with Chris Huhne representing, in effect, the European Union position. The Chinese, Americans and other participants were in that conversation. He was trying to keep what was at that stage a fragile-looking process, if hon. Members cast their mind back to 2010, on track. Britain played a key role in the Cancun conference on the UNFCCC, but we did so because we were part of the European Union. We were accorded that importance by other major economies and participants because of our links to the EU. The fact that the European Union went to that conference with a common position, and that a major economy like the United Kingdom shared that common position, was critical to our role. It meant that some of the priorities that the UK took to the conference could be highlighted—for instance, on a more high-minded level, the balance between mitigation and adaptation, where we and other progressive states pressed hard for a high proportion of UN climate finance to be spent on adaptation and to actually go to developing countries that were already facing the brunt of climate change to help them to adapt. That is indeed how we are now trying to steer UN climate funds. On a less high-minded level, British commercial and economic interests could have been at stake in those negotiations, and could in future be at stake in the UNFCCC negotiations.

In effect, if the EU torch is handed to someone else to carry at those negotiations, what are the implications for the UK? What are the implications for our vision of how UN conventions on climate change, the protocols and the next stage of the global battle against climate change are fought? What are the implications for the UK economy of that reduced role?

Turning to amendment 55, the hon. Member for Glasgow North East said he would stay awake over the summer and devote his reading to the semester reports on the balance of competences review. That cannot have been the most enjoyable summer holiday he has had. The Government have devoted considerable resources to the balance of competences review and are progressing with it in an informative and authoritative way. It is a helpful exercise on which it is surprisingly easy for Conservative and Liberal Democrat members of the coalition, who may not have the same prejudices about the EU, to reach an objective view on which things are best done at European level, which are best done at national and local level, and which we would seek to change.

It is interesting that other European countries are starting to discuss similar exercises. There is even talk of a Europe-wide equivalent of the balance of competences review, yet we are seriously contemplating withdrawing from all the things that we have just decided that it would be a good idea to do at European level. Again, based on the work of the balance of competences review that has already been done, the Secretary of State—or he might be lucky and have it delegated to the Europe Minister—should publish a comprehensive report on the consequences of withdrawal for the competences we have identified as best carried out at European level, and how are we going to compensate for what we must logically presume is the disadvantage of withdrawal from the EU.

Emma Reynolds (Labour, Wolverhampton North East)

On amendment 55, it is worth clarifying the difference between carrying out, as the Government are, a balance of competences review, which is a thorough review of competences at EU level to which we contribute, and actually assessing the consequences of leaving. That is the big difference between the Government’s work that kept my hon. Friend the Member for Glasgow North East happy in his reading hours over the summer, and the hon. Gentleman’s proposal for a report on the consequences of withdrawal.

Martin Horwood (Liberal Democrat, Cheltenham)

Yes, again that touches on the debate we had yesterday on whether we should be talking about a neutral exercise on whether the UK should be a member of the EU or not, as if those were two quite equal things, or whether the wording should reflect that. A massive change in the status quo is being contemplated, with enormous possible consequences. The balance of competences review has been a fairly neutral exercise about where we would like the balance of competence to lie. Withdrawal would be quite a different proposition, and we would be talking about abandoning those competences at European level altogether.

Amendment 57 would require the Secretary of State for Energy and Climate Change to

“publish a comprehensive report of the environmental, legal and economic consequences of withdrawal from the European Union on the United Kingdom’s participation in the EU Emissions Trading Scheme”.

The emissions trading scheme has its flaws, and the state of the carbon price in recent months, even years, suggests that fundamentally it is not working. I was a member of the Select Committee on Environmental Audit that carried out a review, even at a slightly healthier carbon price, that suggested that the ETS was not going to meet its ultimate targets of reducing carbon emissions by the necessary amount. There are critics of the ETS, yet we have been its advocate. It is in our interest to argue for the tightening of licensing under the ETS and for greater auctioning of those licences, and to try to pull in those states that, under the cover of recession and economic difficulty, may have got away with much higher ceilings on licences than is desirable for the long-term decarbonisation of the European economy. That is, of course, in all our interests, because it is in all our interests to fight climate change and to achieve decarbonisation.

9.30 am

Britain has participated in the trading of carbon permits, so jobs have been associated with the operation of the ETS. In fact, London has become a centre for carbon trading on that basis. The ETS is a model for other parts of the world trying to set up their own carbon trading schemes. At some stage, such schemes could link up and we could see the emergence of a true global carbon market, perhaps with London at its centre. I suspect that the chances of London being at the centre are not very high if in the meantime we have withdrawn from the ETS. Again, we must talk through the implications of the UK exiting the ETS scheme.

Above all, businesses want certainty. They do not necessarily want preferential treatment, but they do want certainty. They want the rules of the playing field to be set out well in advance so that they know what decisions they are taking. Businesses will want to know the situation regarding the ETS. If there is the possibility of withdrawal a few years down the line, it is critical that someone in a relatively carbon-intensive business knows the implications of the discussions we are having about withdrawal from the European Union and therefore the ETS.

Amendment 58 discusses our participation in Frontex, which is the Europe-wide attempt at a shared approach to the control of illegal migration and better security at Europe’s boarders, especially for those states that face unusual challenges, such as the plethora of islands in the Aegean. It is important—and for those members of the Conservative party who bang on about immigration almost as much as they bang on about Europe it is presumably very important—that we establish what exactly is going to be the relationship with Frontex and exactly how much we are going to have to pay for the services of Frontex in controlling migration if we want to preserve the free movement of people within the European Union. All those things are interlinked, and if we start to unravel the networks, it is clear that there could be dangerous implications for the United Kingdom in the control of illegal migration. I am therefore sure that Conservative Members in particular will be very supportive of amendment 58, or they should be, in order to see a comprehensive report on the consequences of withdrawal on co-operation with Frontex.

Amendments 59 and 60 deal with EU justice and security co-operation: our participation in Europol in amendment 59, and in Eurojust in amendment 60. I imagine that the relevant Secretaries of State would be the Home Secretary and the Justice Secretary. There are many examples of the benefits of the European arrest warrant and of participation in Europol and Eurojust, and of how cross-border co-operation in tackling crime that does not observe national boundaries has become very important.

For example, in August 2011 in my own county, Gloucestershire, someone was arrested for conspiracy to perpetrate slavery as part of an operation targeting slavery, servitude and forced labour. Following work by, I am proud to say, Gloucestershire constabulary, a 19-year-old man from Gloucestershire was arrested in Copenhagen by Danish police acting on a European arrest warrant. He was then escorted back to the UK by Gloucestershire police officers. That was a co-ordinated operation which, I am sure, used Europol’s services. There are plenty of other examples.

A number of police chiefs and former police chiefs expressed strong views to the Prime Minister and the Deputy Prime Minister last year in a letter signed by Lord Blair, the former Metropolitan Police Commissioner; Sir Stephen Lander, former head of MI5 and chair of the Serious Organised Crime Agency; Lord Imbert, Commissioner of the Met from 1987 to 1993; Robert Wardle, former Serious Fraud Office director; and a series of other Queen’s counsel, former police officers and senior experts on crime and policing. They wrote to the Prime Minister and the Deputy Prime Minister about the risks of withdrawing from things such as Europol and Eurojust:

“Britain has been a leader in this area over many years, driving forward work to build a modern international policing and judicial tool kit, building cooperative networks and raising standards across Europe. Today, a former British law enforcement officer is the Director of Europe’s Police Intelligence Agency (Europol); a senior British prosecutor has just completed a two year Presidency of the European Judicial Cooperation Unit, (Eurojust); and Britain hosts the European Police College, training officers across Europe in modern international policing techniques. British law enforcement bodies are now constantly communicating, cooperating and collaborating with EU agencies and other national policing partners in pursuing serious organised criminal and terrorist networks.”

Withdrawal will affect not just our ability to tackle people trafficking and anti-slavery operations but our ability to work on drug cartels, counter-terrorism and more routine forms of crime—the horsemeat scandal almost immediately involved Europol, which tracked down networks of suppliers and possible criminal involvement in the scandal. Therefore, our participation in Europol is very important.

It has often been said that in theory we could re-establish those bilateral relationships without being part of the EU. However, we know from the past that those bilateral relationships can be weak. We all remember the example of the “costa del crime”, where British villains appeared to be able to sit with complete impunity on the beaches of the Costa del Sol without fear of arrest. We do not want to go back to those days.

I have tried to persuade campaigners in the Liberal Democrats that we should be running strap lines on leaflets saying “Tories soft on crime” for questioning our membership of Europol and Eurojust. However, the Government have committed themselves strongly to participation and collaboration with Europol. We want to understand the implications of withdrawal on our co-operation with Europol and Eurojust.

I have taken up a lot of the Committee’s time; I will quickly refer to the other amendments. Amendment 61 is about our participation in the Schengen information system. Amendment 62, which is relevant to what I have been discussing, is about the consequences of withdrawal for Britain’s participation in the European arrest warrant. Amendment 63 is about the report required on the implications of withdrawal for EU research and development funding in the UK. Amendment 64 deals with European structural and investment funding in the United Kingdom, which has benefited many regions in the UK. Amendment 65 deals with the necessity of a report on the economic consequences of withdrawal from the EU for European Investment Bank funding in the UK.

Amendment 66 deals with the consequences for the agricultural sector of withdrawal from the common agricultural policy. Opinions in the agricultural sector are mixed on the benefits of the common agricultural policy, but it has been reformed considerably in recent years. There is now more emphasis on the stewardship of the land, environmental consequences and so on. Those consequences need to be thought through, in addition to the economic consequences, which may not be severe for those who feel they are able to compete in the European agricultural market, but will be more difficult for those in marginal farming areas who benefit significantly from the common agricultural policy.

Kelvin Hopkins (Labour, Luton North)

I have called many times for the common agricultural policy to be abandoned—certainly by Britain. If we withdrew from the CAP and subsidised our farmers at exactly the same level, we would benefit enormously financially. We could also target subsidies more effectively and more appropriately if we had control of our own agricultural policy.

Martin Horwood (Liberal Democrat, Cheltenham)

That is not an unreasonable argument for trying to gain more national control over agricultural subsidies. If we want access to a single market in agricultural produce, however, we need to ensure that we comply with its rules. We would not have any control over the rules of the single market if we withdrew, so we might be at serious risk of having to keep the subsidies rolling even when we were denied full access to the single market for European agricultural produce because we had deviated from the rules. A risk factor would be introduced. However, the hon. Gentleman makes a reasonable case perhaps for the whole European Union to look at the fundamental need for the common agricultural policy in its current form. The parallel to that is the common fisheries policy, which was in the end felt to be burdensome.

All such policies had good origins and a good rationale at the beginning in trying to maintain Europe’s food security. The origins of the CAP were in trying to maintain Europe’s food security after the second world war, when the issue was serious, but such things have a shelf life and can perhaps be reformed. The CFP has indeed been reformed and decision making has been brought much closer to the national level.

Kelvin Hopkins (Labour, Luton North)

I hesitate to prolong the hon. Gentleman’s speech, but I must comment on the common fisheries policy, which is the worst of all the European Union’s policies. We have seen some reforms and I give credit to the Minister who dealt with them, but we are nowhere near where we should be. We will get a fisheries policy that works and sees the seas restocked only when member states get control of their own fisheries and are responsible for husbanding them.

Martin Horwood (Liberal Democrat, Cheltenham)

There is control—and control. There is the kind of control that is envisaged in reforms to the common fisheries policy, which would bring decision making closer to national and local levels, but a free-for-all in European fisheries might actually threaten our fishing industry. I am not sure that all Norwegian and Icelandic fishermen would necessarily think that a complete free-for-all whereby Spanish trawlers and others could exploit their fisheries in a less inhibited way would be positive. There is some argument for a degree of continental control that maintains fish stocks and examines fishing rights to try to protect the rights of various domestic fishing industries, but that would become more difficult, so there is certainly a risk here.

I am arguing, if we take fisheries as including agriculture for the sake of argument, that we should have reports laid before Parliament that actually talk through the implications of such proposals. Perhaps the hon. Gentleman is right that there would be a massive benefit, but that would be one of the subjects of any report laid before Parliament, so perhaps he should support the amendment.

Hon. Members will be pleased to hear that I have reached my last two amendments. Amendments 69 and 70 examine our withdrawal from the common foreign and security policy and the common security and defence policy, which is different. We need to consider the implications for the United Kingdom and our role in the world of withdrawal from the European Union. Positive benefits of our membership include our being able to take part in important operations such as Operation Atalanta, which is making a massive contribution to anti-piracy operations in the Indian ocean and protecting British and others’ shipping. Other benefits include the military training mission in Mali, in which we are taking part under the auspices of the European Union and where we are helping to train up and make more resilient the official armed forces of that beleaguered country. We must also bear in mind the simple economic and cost-saving opportunities that have been delivered by consular co-operation in many countries. We are using other European Union members to deliver our consular services, while in future we might look at more shared consular and ambassadorial services, and consider more co-operation in respect of international development and how best to spend our scarce funds on overseas aid. There is a range of possible implications of withdrawing from the European Union in various areas of common foreign, security and defence policies.

The amendments are important. They would play a part in ensuring that an informed debate was generated on the basis of real evidence and an objective assessment of real implications, not prejudices or perhaps hysterical accusations. I suspect that Mr Nigel Farage would not particularly welcome such proposals. He has the approach to evidence of a bloke in the pub with a pint in his hand and a fag in his mouth.

The country desperately needs a proper debate on the implications of withdrawal from the European Union, which would be absolutely critical in the run-up to an in/out referendum. I hope that all members of the Committee will welcome the amendments. Amendment 72, which was tabled by the hon. Member for Wolverhampton North East, is set out in a similar vein, so some of my arguments might be rehearsed in the debate. I commend the amendments to the Committee.

Emma Reynolds (Labour, Wolverhampton North East)

It is a pleasure to serve under your chairmanship again, Mr Benton.

We are sympathetic to the amendments tabled by the hon. Member for Cheltenham. He is right that, if the Bill becomes an Act and a referendum takes place before the end of 2017, it is essential, as he set out so eloquently, that there is an informed debate in the country about such matters as the advantages and disadvantages of remaining in the European Union and what the option of coming out of the EU would look like. Would we still have access to the internal market? What would withdrawal mean in terms of our budgetary contribution? We know full well, as the hon. Gentleman stated, that although Norway is not a member of the EU, it always contributes to the EU budget.

As the hon. Gentleman’s amendments set out, it is essential that the Government publish a comprehensive report at least 12 weeks in advance of polling day. That seems a reasonable period. The Government might even want to publish a report 20 weeks before polling day. Such matters are an essential part of the debate that would take place if the Bill were enacted and there was a referendum.

There is another reason why I welcome the amendments: when I tabled a parliamentary question to the Minister for Europe to ask what assessment the Government had made of the risks of leaving the European Union, the Government refused to answer. In response to my freedom of information request, they said that there was a report on the risks of leaving dating back to 2012, but that they were not willing to release it.

I also asked about contingency plans for leaving the European Union—my question was related to the amendments, in that it was about the consequences of withdrawal—and the Minister for Europe’s answer was that the Government had no contingency plans for leaving the European Union because they regarded our membership as in the national interest. That is certainly a comfort to me as a pro-European, but I am sure that it is not a great comfort to Conservative Back Benchers, given that they take a different position.

Martin Horwood (Liberal Democrat, Cheltenham)

While the hon. Lady maintains that that is a comforting position for those of us who would argue for Britain remaining in the European Union—I am sure, in one sense, that she is right—it highlights that the implications of us voting to leave would be even more catastrophic were no contingency plans made for that. We would be sending ourselves headlong into an unprecedented catastrophe in our economic, political and diplomatic relationships, as well as many others.

Emma Reynolds (Labour, Wolverhampton North East)

The hon. Gentleman makes a valid point. The Prime Minister’s so-called Bloomberg speech in January on our membership of the EU was along the same lines. The Prime Minister and those pro-Europeans on the Conservative side of the Government—I do not know about the Liberal Democrat side—such as the Minister, do not want to contemplate leaving, even though many Conservative MPs and lay members of the Conservative party want the Government to take us out of the European Union.

The promise of a referendum in four years’ time is kicking the can of what could happen down the road. Either the Government of today or the Government of 2017, if the referendum takes place, should make, as in the spirit of the hon. Gentleman’s amendments, an objective assessment of the risks of leaving, yet the Government refuse to do so at this time. I have tried in many different ways to encourage them gently to do so, but it seems that they are not willing. Perhaps they have information about the risks of leaving that they do not want to release for political reasons. I agree with him that that information should be released before polling day, should there be a referendum, which is why his amendments are so important. I have already tried to extricate that information from the Government, but they are unwilling to release it. They may not have carried out work in great detail. However, as he said, it would need to be done in great detail and released into the public domain so that the public may make an informed decision on whether we should leave the European Union. This is an important issue of national interest.

I also welcome the fact that the hon. Gentleman’s amendments cover a wide range of policy areas. As we debated during our previous sitting, the question of our EU membership touches on many aspects of the Government and has an impact on every Department. He talked about relevant Secretaries of State producing the reports so that each Department would be obliged to think through in detail the advantages of staying in and the risks of leaving, which I would welcome. They should be encouraged to use the Government’s resources to bring together a body of evidence that is as objective as possible and to set out an assessment of the implications of leaving and of staying for the Departments.

Martin Horwood (Liberal Democrat, Cheltenham)

The hon. Lady is underlining the fact that the Departments would probably have to do the work in any case. If there was a realistic prospect of a referendum taking place and of a vote for a British exit, a responsible civil service would tell Ministers that they had to think through its implications. In a sense, the issue is whether the information will be laid before Parliament and shared with MPs, the British public and the media.

Emma Reynolds (Labour, Wolverhampton North East)

The hon. Gentleman makes a valid point. One would hope that the Government would do the work anyway, but the important thing, as he says, is for that information to be available to Parliament and the public at large, because ultimately the public will decide.

It is useful that the hon. Gentleman’s amendments set out a time scale because that would focus the Government’s mind. Otherwise, some assiduous Departments that are focused on EU matters might produce a report in a certain time, but others could do so later. However, we would want a minimum period in which the public and Parliament could consider the reports, so I welcome the 12-week provision. I might prefer a long period, but that time scale is more or less okay. It is good to have a deadline so that some Departments do not drag their heels and produce something too late for people’s consideration.

Amendment 56 is one of the most important of the hon. Gentleman’s amendments because it would require the Secretary of State to

“publish a comprehensive report of the consequences of withdrawal from the European Union for the economy of the United Kingdom”.

That would be vital, because withdrawal from the European Union would have grave negative economic consequences. Prior to a referendum, many people would consider the economic consequences of staying in or leaving, as is happening with the current debate in Scotland. It is not a surprise that there is great focus on the economy. We might say that the issue is the economy, but other people might call it their jobs and living standards, or the cost of living. Those are relevant to all our constituents.

The UK’s biggest trading partner is the rest of the European Union and, as the hon. Gentleman said, more than 50% of our foreign direct investment comes from other EU member states. Such facts should be put clearly to the British people so that they are informed before they take a decision in a referendum. As he pointed out, the single market of the European Union is the biggest in the world, with 500 million consumers and 28 member states, following Croatia’s accession in July.

Amendment 52, which relates to European free trade agreements, reminds us that our membership of the EU is essential to prise open markets in emerging markets and, as the hon. Gentleman said, existing economies such as the United States and Canada. An EU free trade agreement with Canada is pretty much done, except for a few sticky issues. I hope that the negotiations will conclude soon and that the EU-US agreement will conclude within two years, as under the timetable set out by the Obama Administration. People have a right to know the benefits of those free trade agreements with such large economies—the US economy is still the largest in the world—and the implications of a decision to leave the EU for our trading arrangements with those economies.

William Bain (Labour, Glasgow North East)

Perhaps I may share with the Committee a detail that came out of one of the Scotland analysis papers that were published yesterday about the macro-economics and fiscal performance of the UK as a single market. That report revealed that physical barriers between the United States and Canada—there is not a complete single market as in the EU—have resulted in lower trade in the past few decades. Is not there a need for such evidence to come out, and would not the amendments create a process whereby the British public would be given that information?

Emma Reynolds (Labour, Wolverhampton North East)

That is right. Our single market, and particularly the single market in goods, has been a great success. We might compare it with other regions of the world that have not had a successful single market in goods. There is the North American Free Trade Agreement, but there have been different degrees of success with such agreements. Obviously, in the EU, we have a much more integrated way of producing a single market.

There are, however, other regions around the world—ASEAN for the south-east Asian economies, or economies in Latin America—that are looking at the success of the EU’s single market in goods, in particular, seeing what lessons they can learn and being inspired. At the moment, there are lots of headlines about difficulties within the eurozone, but let us not forget that the single market in goods in the EU acts as an inspiration to countries around the world that are attempting to come together to act along similar lines.

The fact that we have created that single market should be celebrated and emphasised in the reports proposed by the amendments tabled by the hon. Member for Cheltenham. Such reports should be considered clearly and carefully, and the objective facts should be set out in terms of what we could lose, should people vote to leave the European Union.

Some Eurosceptics say that we should trade with the rest of the world, rather than the rest of Europe. That is a false choice, although the hon. Member for Cannock Chase might take a different position.

Kelvin Hopkins rose—

Emma Reynolds (Labour, Wolverhampton North East)

And my hon. Friend the Member for Luton North, for that matter.

Kelvin Hopkins (Labour, Luton North)

It really is a canard to suggest that if we leave the European Union, we will not trade with it—that is absolute nonsense. I have mentioned many times that we import gigantic amounts from the European Union, and it depends more on us to buy its BMWs and other wonderful vehicles than we depend on it.

Emma Reynolds (Labour, Wolverhampton North East)

I tend to agree with the hon. Member for Cheltenham rather than my hon. Friend the Member for Luton North on this point. The idea that other EU member states are more reliant on us than we are on them is a fallacy. There is interdependence between our economies and while it is true that we have had a consistent trade deficit in goods—specifically with Germany, but also internationally—we do have a trade surplus in services, so there are two sides to the story. The point I am trying to make is that there are some Eurosceptics, although perhaps not my hon. Friend, who say that we should choose to trade with India, South Korea, Brazil, Russia, China and Indonesia—all the emerging economies—and focus our efforts on them, rather than the European Union.

Gavin Williamson (Conservative, South Staffordshire)

For the record, will the hon. Lady be kind enough to state the year in which we last had a trade surplus with the rest of the European Union?

Emma Reynolds (Labour, Wolverhampton North East)

I welcome the contribution of the hon. Gentleman, who is my parliamentary neighbour. It is great to hear from him in this Committee and I would welcome more interventions from him. The point I was making was that there is a difference—

Gavin Williamson (Conservative, South Staffordshire)

Just the year.

Emma Reynolds (Labour, Wolverhampton North East)

I am coming to that. My point, as I said in my speech—I am sure that the hon. Gentleman was listening clearly—is that there is a difference between the trade deficit in goods, which we have had throughout this Government, as we did throughout our Government, as far as I am aware, and the trade surplus in services.

Gavin Williamson (Conservative, South Staffordshire)

Overall.

Emma Reynolds (Labour, Wolverhampton North East)

Well, it will depend. I do not have the statistics in front of me, but perhaps the hon. Gentleman would like to do some research and let the Committee know. I would welcome a speech from him—it would be remarkable in this Committee to hear a speech from a Conservative Member other than the Minister for Europe. I am sure that all Labour and Liberal Democrat Members would welcome that.

The point I was attempting to make was that trading with the rest of the EU or trading with the world’s emerging economies is a false choice. Our membership of the EU means that we have a much more powerful collective negotiating position, especially with big countries with huge economies such as India and the United States. If the UK were to attempt to go it alone—if we were to leave the EU and to negotiate our own free trade agreements with these massive economies—I doubt that we would have the negotiating power to achieve a trade agreement that really benefits us in the way we would like. Is the way we see free trade agreements being negotiated between the EU and other big economies around the world ambitious? The collective negotiating power of the biggest single market in the world is not something that should be overlooked.

As the hon. Member for Cheltenham pointed out, the world trade rounds are not going very well. There seems to be an international consensus that, given the breakdown of recent negotiations, there will be an increased focus on regionalisation, as an international trade round does not seem to be an objective that will succeed. We should do both. We should continue to trade intensively with the rest of Europe and to increase our trade with emerging economies and established big economies around the world, such as the United States. The hon. Member for South Staffordshire, whose constituency borders mine, will know of the benefit of foreign direct investment. Jaguar Land Rover is building a massive engine plant in his constituency, which I hope will bring great benefits to his constituents and to mine not only in the form of jobs, but through the supply chain and the wider economy.

Jaguar Land Rover kept its name, but it is now Indian-owned. Big international companies see how our country is a gateway to the rest of the European Union. There are reports in the press only today of various banks saying that they would think again about investing in the UK if we were not a member of the EU. Like the hon. Member for South Staffordshire, I am heartened that Jaguar Land Rover took the decision to base its new engine plant in his constituency, not far from mine, but I fear that such decisions might be in jeopardy should our membership of the European Union be at risk or if we left the EU after a referendum. There are businesses that have said the same thing. The hon. Member for Cheltenham will know better than me that the Business Secretary himself said that uncertainty is the enemy of investment. So did Martin Sorrell, who said:

“the impact of departure on Britain’s economic health doesn’t need spelling out.”

Business voices in manufacturing and services have warned against the UK leaving the European Union, and the hon. Gentleman’s amendments set out considerations that should be put to the British people, should there be a referendum in the time frame envisaged by the Bill.

I also welcome the amendments’ emphasis on justice and home affairs. As the hon. Gentleman set out, this is an area in which the UK has recently been a leader. Under the previous Labour Government, we were at the heart of negotiations with EU partners to ensure that police forces and border guards co-operated more closely. The fight against crime is being carried out on a cross-border basis. It seems pretty obvious that we cannot fight cross-border crime without co-operating with our neighbours, and the European Union enables us to do that in a way that other countries in the world cannot.

The European arrest warrant, mentioned in amendment 62, is particularly important. The House of Lords produced a thorough report on the warrant and other issues because of the Government’s impending decision on which directives to opt into or out of. It was pointed out in the report that the Association of Chief Police Officers, the intelligence services and others have underlined that should the UK fail to negotiate to remain part of the European arrest warrant—we understand that the Government intend to attempt to negotiate to remain part of it, but whether they will remains to be seen—the UK would become a safe haven for criminals from other member states.

As the hon. Gentleman pointed out, prior to this EU-level co-ordination, the extradition of foreign criminals was extremely difficult. The French Government of the 1980s and 1990s were extremely frustrated by the fact that the main suspect of the Paris metro bombing was not extradited from the UK for some 10 years; that demonstrates that bilateral arrangements in this area are insufficient. Recent examples of criminals whom we have wanted to bring back to the UK to face justice—the failed bomber who was brought back from Rome quickly once he was identified, the well-known fugitive in Spain who was hunted down by the Spanish police while he sunned himself by a swimming pool and who was quickly extradited back to the UK, and the teacher who abducted a 15-year-old schoolgirl and was identified in France soon after he had taken her across the border—serve to show that the European arrest warrant is indeed in our national interest.

It is ironic that some Conservative Members take a hard line when discussing crime and justice, but suddenly see red when discussing a European process for making it easier to bring criminals back to face justice, and decide that it is not in our national interest because the word “Europe” is in there somewhere. They are resistant to any European measures.

William Bain (Labour, Glasgow North East)

Is not the point that the contortions in which the Government have found themselves over justice and home affairs—announcing to the House their desire to opt out of the entire acquis communautaire, and then saying that they will announce at an unspecified later date the parts that they want to opt back into—would be even worse were Britain to withdraw from the EU? The problems would be writ even larger, because that would involve not only justice and home affairs, but also trade, fisheries, agriculture and all the areas of policy in which the EU has a competence. Is it not incumbent on the Government, to avoid the mess that they have got themselves into on justice and home affairs, to set out what the implications would be of opting out of the acquis and then opting into certain parts, if that proved possible, following negotiations in Brussels?

Emma Reynolds (Labour, Wolverhampton North East)

My hon. Friend makes an interesting reference to the situation that the Government have got themselves into over the justice and home affairs measures that they must negotiate their way back into, should they wish to be part of them. We do not know how many measures that will be, but they have chosen to use the block opt-out and then to opt back in, which is open to negotiation with both the European Commission and other member states. We might find a similar situation should the UK embark on the process of leaving the EU. We might, like Norway, be able to participate in some legislation, but we would not have a vote, because we would not have permanent representation in Brussels, a Commissioner at the European Commission or Members in the European Parliament. The Government of the day might still want to be involved in Europol and the European arrest warrant, and might try to negotiate on them, but they will have few bargaining chips in their hand. My hon. Friend’s point is instructive to our debate, as there is a parallel between the Government’s current negotiations on justice and home affairs and what we could see in other areas in the future.

As the hon. Member for Cheltenham said, Europol is extremely important to our national security. The head of Europol is a Brit, and he is doing a fantastic job. It is important to note that when the horse meat scandal broke out earlier this year, the Secretary of State for Environment, Food and Rural Affairs, a well-known Eurosceptic, sang the praises of Europol and travelled to Brussels to demand that the Council of the European Union take action to root out fraud. Even some Conservative Eurosceptics, and even that Secretary of State, when it comes to specific problems that our country faces, seem to appreciate that European co-ordination helps us to tackle those problems. As I said, that Secretary of State was complimentary about Europol and said that it was the only body that could identify and help fight fraud in that particular case.

The hon. Member for Cheltenham is right to table amendments that are about not just the economy. As I said, the economic consequences are particularly important at the moment and are high on people’s list of priorities, but other areas, such as justice and home affairs, are also important. He tabled amendments 69 and 70. As he said, it is important to consider the consequences of withdrawal for the UK’s participation in the EU’s common foreign and security policy and common security and defence policy. The UK has been a leading light in those areas, along with France. We are a member of the United Nations Security Council because we have a tradition of being strong in the world on foreign policy. If we left the European Union, our role in the world would be greatly diminished. Those considerations should be put before the British people, should there be a referendum.

It is not just people in the UK who are warning about what would happen to the UK’s role in the world should we leave the EU. President Obama himself has warned about what it might mean for the special relationship between the UK and the US. Presidents Bush, Clinton and others, including President Obama, have consistently regarded the UK as a bridge to the rest of Europe. More recently, the new American ambassador to the UK, Matthew Barzun, said:

“We would benefit by a really strong UK voice in a strong EU…We like a cohesive, strong Europe that is working with us around the world.”

The clear message from Philip Gordon, Assistant Secretary of State in the American version of the Foreign and Commonwealth Office, who is in charge of European affairs, was that one reason for the close relationship between our countries is the UK’s membership of the European Union. The US believes that our membership is an asset to the UK and our relationship with it. The US has left us in no doubt about what it thinks.

A former British ambassador to Washington, Sir David Manning, recently wrote:

“Outside the EU, our influence in Europe would be sharply diminished; but so it would be in the United States. The risk to the UK of leaving the European Union is of a rapid drift into international irrelevance.”

The voices of experienced diplomats for Governments around the world should be gathered together in a report, as proposed in amendments 69 and 70, which should be taken on board in the debate in Parliament and the wider country if a referendum takes place.

I want to comment briefly on amendment 87, tabled by my hon. Friend the Member for Huddersfield, who unfortunately could not be here this morning. His amendment, like the amendments tabled by the hon. Member for Cheltenham, refers to the Government laying before Parliament a report on EU competences under the current treaty and the treaty on the functioning of the EU which the Government intend to repatriate from the EU to the UK.

If the Conservative party wins the next election—I am speaking hypothetically because we are in the business of preventing that—it will have to make it clear before or after the election which powers it will seek to repatriate. The Prime Minister was deliberately vague in his Bloomberg speech in January. He talked about reforming the EU and a more competitive and flexible EU. We agree with that, but he did not use the word “repatriation” in that speech, although he has used it in parliamentary debates and, I believe, when talking to his Members of Parliament.

As the hon. Member for Cheltenham said, if a referendum takes place, we would need an assessment of the options—in or out—and the amendment seeks to clarify what “in” will mean in terms of repatriation if the Conservative party is in government then. Some Conservative Members have drawn up a shopping list of areas they would like to repatriate from the EU. At the top of that list apparently is the repatriation of employment and social affairs. We would oppose that, and perhaps even my hon. Friend the Member for Luton North might oppose it. I may be tempting him to comment—or perhaps not.

I am my party’s spokesman on Europe and we passionately believe that the Conservative claim that repatriating powers in this area would be returning powers from Brussels to Westminster is hiding the truth that repatriation would take power and rights from working people. Let us not forget that some of the directives set basic minimum standards. For example, the European directive on parental leave sets minimum periods of parental leave and many member states, including our own, have gone beyond those in their legislation.

Kelvin Hopkins (Labour, Luton North)

Employment law is simple: if we have a Labour Government, we can implement progressive employment law for workers and trade unions, which I have advocated for many years, without having to depend on the European Union. Indeed, we could go beyond the EU minimum as some countries have already done, as my hon. Friend said. It is our duty as a national Parliament to ensure that our workers and trade unions are protected.

Emma Reynolds (Labour, Wolverhampton North East)

There is probably more common ground between my hon. Friend and me in this area than in some others. Of course, Labour Governments in our country have always legislated—and will always do so—in a progressive way on trade union rights and workers’ rights. That would be fine if the UK was not a big trading nation and not one of the most open economies in the world, but what complicates these matters is the fact that workers cross borders. Not only do British workers go to work in other member states, but European workers come to work in the UK, so there is tension between the free movement of goods and the free movement of people.

We saw that only a few years ago when we were in power and Spanish and Italian workers were working here in an oil refinery and questions were asked as to whether they were getting minimum standards. By applying minimum standards across the EU, we have at least got a level playing field at that minimum level. We will not always avoid tension—that case did not escalate to conflict, and the trade unions played a constructive role in that dispute—but having some minimum standards helps to try to manage those tensions.

Martin Horwood (Liberal Democrat, Cheltenham)

Is not another advantage of having an agreed framework of progressive employment legislation the fact that it prevents the argument that such legislation would somehow cost jobs? If we abandoned that common framework, an argument against a—hypothetical—Labour Government who were trying to introduce even more progressive legislation might be made that that would cost British jobs, as there would be potential to transfer those jobs to a less generous employment regime across the English channel.

Emma Reynolds (Labour, Wolverhampton North East)

That is absolutely right. This is a complicated area because on the one hand there should be, as the hon. Gentleman points out, a minimum standards framework in which all member states operate, but it is also true that welfare state and employment protections differ across member states. There is a great variety of models and diversity in protection.

The EU should do better in making sure that workers coming into a country should be treated in the same way as domestic workers. International companies should respect the full body of employment law of that member state—I hope that my hon. Friend the Member for Luton North would agree. The EU has the power to make sure that that happens, but there have been incidences where there has been difficulty in that area. It is a difficult area and it is a priority for trade unions that the European Union should again put economic freedoms and social protections on the same level.

One of the rulings that came out of the Viking and Laval cases was that economic freedom would trump national collective rules in employment. That worries me, and I hope that it can be rectified, but it is the European Union that has the exact ability to rectify that tension. It would not be helpful if we did not have the European Union because that problem would not then have a solution. These are difficult issues, but I believe passionately that there should be basic minimum standards set at European level.

I do not, however, agree with proposals that there should be a European minimum wage, as that is going too far. I remember when the Labour party was last in government—my hon. Friend will remember better than I because he was here at the time—and introduced to the House legislation to set a national minimum wage. Members of the Conservative party and, indeed, of some employers’ organisations said that it would cost jobs. The national minimum wage is one of the proudest achievements of our time in government, but I do not want to see that rolled out at a European level because the differences between countries is too stark, but I think that there should be a bare minimum. The EU should have some power in that area, but there is a limit to how it should be used and to what extent. I am trying to say that it is not a black and white choice. We should have minimum standards but, as my hon. Friend has set out, national Governments should legislate beyond those minimum standards. There are some areas, such as national minimum wages, that should remain at a national level—there should not be an attempt to Europeanise such processes.

I got into a debate on European employment law, but I was commenting on the shopping list that Conservative Members have proposed. We should bear in mind something that we touched on yesterday: there are 27 other member states in the European Union. If the Conservative party was in government in 2015 and trying to negotiate some kind of repatriation, other member states would want concessions as well, although we do not know what they would call for. Much like the European budget negotiations, the process would be very complicated, and I think that it would take longer than the two years between 2015 and 2017—the period of time that we were discussing with the Minister for Europe yesterday. The Conservative party must further clarify the repatriation debate. For the time being, the Prime Minister has been deliberately vague as to which areas he wants to repatriate, because he knows that there is a range of opinion among Government Members as to which areas and powers to repatriate.

Martin Horwood (Liberal Democrat, Cheltenham)

I cannot help but think that the argument about repatriation is a bit of a red herring. The hon. Lady is absolutely right that there are numerous factions in the Conservative party. I am horrified to notice that the booklet to which I was referring earlier was written by David Campbell Bannerman, who I suppose must be a descendant of the great Liberal Prime Minister, who might be spinning in his grave. Anyway, the booklet advocates complete withdrawal. There are shades of opinion, but many of the people who are advocating repatriation are simply using it as a stalking horse for exit. They will build up the case for repatriation, and when it is inevitably impossible to fulfil, that will be the excuse for campaigning for exit.

I think that the Prime Minister’s position is rather different, given that, as the hon. Lady rightly said, his Bloomberg speech did not mention the word “repatriation” at all. It actually proposed a moderate and measured set of reforms that most Liberal Democrats would sign up to in their entirety. If that was the limit of the ambition for a renegotiated relationship, I must say that we would be pretty supportive of it, and we would see no need for a referendum in order to achieve it. In effect, we are seeing multiple camps in the Conservative party starting to map out their position in advance of an in/out referendum campaign in which they would be on different sides. However, I do not think that either side of that argument is really expecting the repatriation process to take place as far as I can see.

Emma Reynolds (Labour, Wolverhampton North East)

The hon. Gentleman makes an interesting point. There are many strands of opinion in the Conservative party and I agree that there is a division of the Tory party that talks about repatriation. As he says, it wants withdrawal unless we repatriate a long list of powers, knowing full well that it is not going to be able to repatriate them all. It may be that it secures some concessions on certain directives, but I do not think that if it attempted to repatriate a whole policy area it would achieve that. However, it might, for example, secure some sort of permanent opt-out of the working time directive, which seems to be something that exercises Tory minds in a very lively fashion. There may be areas where it can secure concessions, but that will not be significant repatriation.

The hon. Gentleman is right that the Prime Minister did not mention this in the Bloomberg speech. A lot of what the Prime Minister said in that speech about a flexible, competitive Europe is not something that we disagree with, but that does not amount to repatriation or renegotiation. The Prime Minister has been at pains to stress to his European partners the fact that he wants to see reform at the level of 28; that he does not want to see unilateral reform. That is sensible, yet when he is talking to his party he seems to up the ante on repatriation. He is trying to have it both ways and at some point, fudging it in that way will not be possible because people will start to ask questions about what repatriation he is seeking, whether he is able to achieve it and perhaps, as the hon. Gentleman suggests, in his own mind he knows that it is unrealistic to have repatriation in many different areas.

The truth is that if one looks at the internal market, and if we were to say, for example, that there should be unanimity in voting on financial services legislation, then the Germans might say, “Well, when it affects our car industry, we want unanimity”. The French might say “You can’t change the common agricultural policy unless we have unanimity”. The whole thing starts to unravel in much the same way as if the British Government said, “We would like to repatriate employment and social affairs as an EU competence; we want that back in the British Parliament”. Other member states might say “We want this policy area back”. Inevitably, the European Union is a process of negotiation and compromise. Sometimes those are difficult compromises and Governments concede things that, in an ideal world, they would not, but they so do because they judge that there is a national interest and benefit to forging ahead with agreements in other areas.

The EU is not perfect, and if one could pick and choose, one might choose a different shape for the European Union, but then other member states would have different pictures of their ideal European Union and we would not have a European Union.

William Bain (Labour, Glasgow North East)

My hon. Friend puts her finger on an important point in relation to our financial services industry. At the moment, because we are part of the European Union, we have influence in shaping some of the important rules, regulations and directives being negotiated in Brussels. If we were no longer part of the European Union, we would have no influence whatsoever, but would still have quite a dramatic implication for the financial services sector in London. Does not that give further credence to the suggestion that the Government should be coming forward with reports not just on trade, the environment, energy and agricultural policy, but on what that would mean for our economy, and for the important part of our economy that is, of course, financial services?

Emma Reynolds (Labour, Wolverhampton North East)

I agree with my hon. Friend. I have been to speak at meetings in the City with representatives from banks, insurance companies and pension funds. As a pro-European, I feel comfortable in those meetings because those companies tend to be of the pragmatic opinion that we are better in than out and that leaving would create great risks to the UK’s financial services sector. He makes an extremely valid point.

In December 2011, when the Prime Minister stormed out of the European Council meeting at 4 am and there was a botched attempt at getting concessions in the financial services area, the irony was that representatives of the City pointed out that they had not asked for those changes or concessions. The representatives of UK financial services that I have met are keenly aware of the risks of leaving the EU and value our membership. That is not to say that they agree with every dot and comma of every European directive that affects them—of course not. There are some directives that are problematic and some that this Government and the previous one had to negotiate with European partners.

The amendments tabled by the hon. Member for Cheltenham have a good and honourable objective. The proposed reports would inform any debate, should a future Government hold a referendum. I am sure that we will return to consider the risks of leaving versus the advantages of staying in—and the disadvantages; I am sure my hon. Friend the Member for Luton North would call me on that if I did not mention it. As the hon. Member for Cheltenham said, using Government resources to draw up the most objective analysis of the costs and benefits of staying in or leaving would be extremely valuable for public debate.

William Bain (Labour, Glasgow North East)

I support the amendments in the names of the hon. Member for Cheltenham and my hon. Friend the Member for Wolverhampton North East, which go to the heart of the debate on the Bill. The hon. Member for Stockton South is asking us to support the enactment of a referendum, but we have not yet heard what the implications would be of whatever answer the British people might give to such a question. We have not heard from the Government what the terms of remaining part of the EU would entail. They have not spelled out any heads of argument, let alone details, on those areas in which they envisage our relationship changing, were there to be a renegotiated treaty with the rest of the EU, and nor have they spelled out the consequences of a no vote. If there were such a vote, we would no longer be part of the EU, but we have not been told by the Government or the hon. Member for Stockton South whether there would be any continuing relationship at all with the EU.

We do not know whether the hon. Gentleman and the Conservative part of the Government envisage, in the event of a no vote, that we would have a relationship akin to that of Turkey, albeit Turkey wants to join the EU while we would have decided to leave. With regard to a customs union, we do not know whether the Government or the hon. Gentleman envisage our relationship as akin to that of Switzerland. We would then not be part of the European economic area, but part of the European Free Trade Association, with some relationship with the EU and being bound by a good many of its regulations and directives, particularly those related to the single market.

We do not know whether the hon. Gentleman or the Conservative part of the Government would intend, in the event of a no vote, that our relationship with the European Union would be akin to that of Norway and that we would be a part of the European economic area and would have a slightly different relationship from that of Switzerland with the European Union.

If the amendments tabled by my hon. Friend the Member for Wolverhampton North East and the hon. Member for Cheltenham were agreed to, we would be giving the British people the guarantee of a rigorous, evidence-based, factual analysis of what could happen as a result of the question that the hon. Member for Stockton South wants to put the British people. We would also provide people with evidence and facts about all eventualities.

If the amendments were agreed to, they would put one other point in the minds of the British people: the difficulty and the magnitude of leaving the European Union. They would be able to consider the disadvantages that we would face, were we to have a relationship with the EU akin to that of Switzerland, Norway or Turkey, or, indeed, if we were not to have any relationship with the European Union at all, given the consequences that that would have for negotiating bilateral trade agreements with the 27 other countries with which we have a single market at present. Of course, should we not be part of the EU delegation in the World Trade Organisation, we would secure the twin effect of diminishing our own influence and that of the European Union in future world trade talks. All of those points need to be explored.

As I said earlier to the hon. Member for Cheltenham, I commend the Government for two streams of work they have done, the first of which is the work of the Business Secretary in early 2011. At that time, the Government published a document on the benefits of completing the single market, which also touched on areas such as what the downsides would be if Britain was no longer part of the single market. It revealed quite clearly that should we choose to leave the single market, our trade with the rest of the EU would diminish and, were the single market to be completed, we would not enjoy the advantages that would go to countries remaining in the European Union. It also revealed that if we had a relationship with the single market such as that of Norway or Switzerland, we would not experience the full gains from completing the single market. Such evidence is needed before we go much further in this debate.

The other stream of work for which I commend the Government is in relation to the referendum that will happen in the relatively near future, although perhaps not as quickly as I and the Scottish people would like. Our patience has been tested by the interminable length of that referendum campaign, so we see a real warning from one part of the United Kingdom about the dangers of having a long, open-ended period for a potential referendum campaign. However, the analysis papers commissioned by the Government have very helpfully set out the consequences for every aspect of life in Scotland that would flow from Scotland leaving the United Kingdom, including consequences for trade, and for our influence in the EU and the world.

The amendments, if implemented, would therefore have a similar effect on the debate about our membership of the European Union as the analysis papers have had on the debate about Scotland’s continued membership of the United Kingdom. In recent times in Scotland, we have seen support for membership of the United Kingdom rising and that for leaving the UK falling. From my perspective as a pro-European, the more that people engage with the facts—we as a Parliament should make it incumbent on the Government to produce the facts so that the debate is conducted not on the basis of prejudice, but on a hard-headed assessment of our economic future and our future position on social and employment rights, the environment and trade—the more we will see an increase in support for the UK staying within the European Union.

We have already heard that our involvement in the European Union is a positive benefit in many parts of our national life. We heard from my hon. Friend the Member for Wolverhampton North East about the impact on the detection and prevention of crime and why the European arrest warrant is a massively important and beneficial development. As I mentioned in an intervention, we have seen the difficulties of the Government saying that they want to opt out from particular areas, but later wanting to opt back in. If the amendments were accepted, the Government would be obliged to produce an assessment of the consequences of opting out of many parts of the acquis—not only on justice and home affairs, but on social protection and employment rights— and of having to opt back into some areas later.

There would be costs involved. Different forms of regulations from those in force at the moment would cost businesses and people in work. We need to know what those costs are, so if we are to have a proper debate, which the hon. Member for Stockton South wants us to have, it is incumbent on the Government that we have a real and rigorous assessment from them about what the outcome of the referendum would mean. What would a yes vote mean for the terms envisaged for us remaining within the European Union? What would a no vote mean for all the options that I scoped out in my contributions this morning? The British people have to know. Just as people in Scotland have to know what the consequences would be for not having a proper central bank to support the Scottish economy, in this debate we need to know what the consequences would be if the only relationship that we had with the European Union was a customs union and we were not part of the single market.

I support the amendments tabled by my hon. Friend and the hon. Member for Cheltenham because the more facts are provided to the British people in this debate, the better that will be for those of us who wish to stay within the European Union. Furthermore, having any kind of debate at all will depend on the Government providing the facts and giving people sufficient time to absorb them in the run-up to the referendum, if Parliament chooses to have one.

Martin Horwood (Liberal Democrat, Cheltenham)

I realise that it is slightly unusual for me to speak a second time in the debate before the right hon. Member for Aylesbury takes part, but I do so partly because in my rush through the initial set of amendments, I completely omitted to mention amendment 68, which refers to consumer rights—[ Interruption. ] I was rushing to conserve time, so I managed to miss it. The implications of withdrawal from the European Union for consumer rights are obviously important, and I did not mean to omit them.

I have been struck by how wide ranging and broad the debate has been at times, occasionally deviating into political discussions that are not entirely or directly related to the content of my amendments. Before the right hon. Gentleman speaks, I want to focus the debate on some specific questions.

With regard to amendment 56, I cited the statistic that 200,000 businesses trade with other EU member states. Will the right hon. Gentleman tell us whether any economic evaluation has been done of the impact of potential exit on those 200,000 businesses, and their trade with the EU, so that we can establish whether we are talking about simply trying to enable new work to be done, or about trying to make public a body of work that is already under way?

Amendment 52 is about current and future free trade agreements. In the case of a future free trade agreement, perhaps with Japan—to take an instance slightly further off than the American example—what does the Minister understand that our relationship with Japan would be? If we were part of the negotiations but withdrew during them, would we be cut out of the free trade agreement with Japan and have none of the benefits that continuing EU members would enjoy?

Amendment 62 deals with the European arrest warrant. Hussain Osman, one of those involved in the failed July 2005 London bombing attempts, was arrested in Italy under a UK-issued European arrest warrant and swiftly extradited to the UK to face trial. Is it the Minister’s understanding that, had we left the EU, we would have been able to use such a process?

I want briefly to give two parallel instances—one for Europol and one for Eurojust. First, Operation Rescue was launched by the Met and co-ordinated by Europol across 30 countries. It led to the discovery of the world’s largest online paedophile network. Six hundred and seventy suspects were identified, 184 arrests were made and 230 sexually exploited children were released, including 60 in the UK. If we had exited from the European Union, would we have been able to use the offices of Europol in a co-ordinating role in that operation, which benefited so many hundreds of sexually exploited children?

Secondly—this relates to amendment 60—I will mention a case study from February 2011 on Vietnamese people-smuggling to the UK. A Eurojust co-ordinated operation involving five other countries resulted in 19 arrests of individuals involved in the smuggling to the UK of thousands of illegal immigrants, mainly from Vietnam. If we had left the European Union, would we have been able to use the offices of Eurojust in that operation?

My final question relates to amendment 67. In relation to potential budgetary contributions to the European Union, I suggested as an estimate that if we scaled up Norway’s contribution for access to the single market, the contributions from a separate UK to the EU would amount to £4.4 billion a year. Have the Government made any evaluation of what the amount might be? If the answers to all my questions are, broadly, “I don’t know,” surely the right hon. Gentleman should be well disposed towards the amendments, which might bring about a process of providing some answers.

David Lidington (Conservative, Aylesbury)

It has been an interesting morning during which, as my hon. Friend the Member for Cheltenham said, the debate has ranged somewhat widely. For much of the morning’s proceedings, I felt that we were not so much debating what the Bill is about—whether the people of the United Kingdom should have a vote in a referendum on our continuing membership of the EU—as getting into the territory of the campaign itself. It was almost a drafting session for some of the campaign documents and slogans that we might hear in 2016 or 2017.

The hon. Members for Wolverhampton North East and for Glasgow North East, and my hon. Friend the Member for Cheltenham, put forward perfectly valid, coherent arguments for their points of view. However, they presented an artificial choice between the status quo—Europe as it is today—and exit, which is not what the Prime Minister and my party are talking about. We are talking about a decision of the British people following a period of negotiation and reform.

I was glad that the hon. Member for Glasgow North East aligned himself with the Prime Minister, who said explicitly in his Bloomberg speech that he does not see Norway and Switzerland as attractive alternative models for the United Kingdom’s relationship with the major countries in the European Union. I suspect that one reason why we have had such detailed and learned disquisitions this morning on the arguments for and against continued British membership of the European Union is that, although the hon. Member for Wolverhampton North East is right to say that there are differences of view within my party on that question, comparable differences exist within her party’s ranks—I got the impression that she sought to avoid acknowledging that fact. I did not exactly hear the bells ringing and the hallelujahs echoing from Luton North as she was speaking about the advantages of European Union membership. What she and the hon. Member for Glasgow North East carefully avoided saying was whether they think the British people should be entitled to the final say, which is the central purpose of the Bill.

I come to the substance of the amendments. I have no problem with the principle that the British public, before they make their decision, should be given as much information as possible about the Government’s thinking and about the arguments for and against membership of the European Union. However, I challenge whether the methods proposed in the amendments are the most appropriate way to achieve that objective.

As a number of hon. Members have said, the coalition Government have launched a balance of competences review, which will enable third parties—in particular, British business—to place on the record their honest assessment of the benefits and drawbacks of Britain’s membership of the European Union and to suggest either far-reaching or detailed and specific reforms. That is one way in which the Government collectively, across the coalition, have agreed to inform public opinion.

To some extent, I am revisiting territory that we explored yesterday. If the amendments were not adopted, a referendum campaign in 2016 or 2017 would not take place in a great white space of public ignorance. It would take place in a political environment in which there had been many months of public debate in this place, in the media and among the wider public about the negotiating process and the issues that are at stake. Ministers would have been called to account, in questions, through statements and in debates, for what they are doing on our behalf.

Martin Horwood (Liberal Democrat, Cheltenham)

The right hon. Gentleman is describing the normal cut and thrust of political debate, which we would expect to take place in that situation. The reason for mandating the reports is, first, to ensure that a thorough exercise using all the resources of Government—as we have done with Trident and the balance of competences review—takes place, and adds to the level of analysis and information in a way that simply making statements or giving opinions does not. Secondly, we need to guard against the scenario, which we touched on earlier, in which perhaps the Secretary of State might not be inclined to report. If we imagine a future coalition in which the hon. Members for Luton North and for Cannock Chase were both Ministers, they might not be inclined to produce a report that explained the precise implications of departing. They could use all the resources and expertise of the civil service and all the modelling and analysis at the Government’s disposal. We simply want to guard against the slight possibility that we might have Secretaries of State who want to wriggle out of such responsibility. For those two reasons, I want to press the point.

David Lidington (Conservative, Aylesbury)

I am sure my hon. Friend the Member for Cannock Chase and the hon. Member for Luton North will be delighted by the career endorsement they have received from my hon. Friend the Member for Cheltenham. I, too, am in no doubt that great things lie ahead of them.

My hon. Friend the Member for Cheltenham is being too pessimistic. First, I cannot conceive of a situation in which a Government, faced with a referendum campaign, would not wish to explain their case in detail. I am not in a position to give a firm pledge on behalf of a future Government, but I would expect a White Paper or a detailed document to explain the Government’s position to Parliament and the public. That is what happened under the Labour Government in the 1970s when they approached the European Union referendum. It would be a logical thing for a Government to do, given that they want to win their campaign. They want to set out in public the case that they are about to take to the people.

As I said yesterday, the issue should not simply be a matter for the Executive. The Committees of this and the other House will want to engage in their own analysis and exploration of the issues involved. One thing that leads me to think that the amendments tabled by my hon. Friend the Member for Cheltenham will not achieve what he wishes is that he seeks to mandate the Secretary of State to provide the various reports. Although Ministers are always advised by civil servants who, quite rightly, are impartial and work for whoever is the elected Government of the day, the reality is that a report published by a Government, ahead of a referendum campaign in which that Government want to secure a particular outcome, is pretty certain to end up reflecting the judgment of the Ministers of that Government, not some great impartial arbiters of blindfolded justice. If the reports were published in the way my hon. Friend advocates, they would end up simply expressing the views of the Government, which they would express anyway.

Aidan Burley (Conservative, Cannock Chase)

I have just got over the giddy vision of being a Minister in a future Government—I think I will be lucky to remain an MP at this rate! What the hon. Member for Cheltenham and others request is simply not possible in reality. For example, it is simply impossible to say how many jobs in this country are directly dependent on the European Union. We would have to ask every single business man in every single business in the country. It is impossible to arrive at a factual answer to that question.

At the end of the day, the issue is about the power of argument. The only facts available are the costs to taxpayers of being a member of this club. That is not in doubt, because we can get those figures: around £10 billion a year. There are the hidden costs of complying with all the legislation. The rest of it is about the power of argument. A lot of the facts requested are simply not available.

David Lidington (Conservative, Aylesbury)

There are many intangible aspects to any analysis of our membership of the European Union. As my hon. Friend says, there are the costs of implementing regulations, which, in turn, requires a judgment about the extent to which, if we were outside the European Union, we would have a different regulatory framework. There is the judgment to be made about the political consequences of this country’s membership of the European Union. One reason why successive Conservative party leaders have supported British membership is that it has been seen as a way to amplify Britain’s diplomatic weight and reach in the world. That is still an important consideration. It is perfectly reasonable for others to argue that, alongside that, we must weigh the cost of limitations on our freedom of action. That judgment itself is affected by what happens, how events develop and how European institutions evolve.

Martin Horwood (Liberal Democrat, Cheltenham)

May I absolutely refute the suggestion, which in different ways the Minister and the hon. Member for Cannock Chase have made, that the Government are somehow incapable of producing impartial, expert advice, judgments and reports on these issues? We do that all the time. The Treasury produces economic forecasts which are not supposed to be cooked to suit the Chancellor of the day. Presumably there would have to be economic forecasts: one for an “in” scenario and another for an “out” scenario, looking forward three, four, even five years.

We are looking at the Trident review and the balance of competences review, neither of which assumes a particular political outcome either way, in this case, rather obviously, because the coalition is not in complete agreement on those issues. However, it is perfectly feasible and desirable for the Government to produce the reports, using the technical, legal and economic expertise that Ministers have at their disposal, but which is not available to campaign groups and political parties.

David Lidington (Conservative, Aylesbury)

My hon. Friend still underestimates the importance of the qualitative as well as the quantitative analysis that will be a key element in the judgment about the net benefit or cost of our membership of the European Union. It is ironic: generally in parliamentary debates some of those who are most hostile to Britain’s continued membership of the European Union are most strident in their calls for a cost-benefit analysis. One of the arguments I have always put forward is that we cannot simply make the judgment entirely on the basis of figures. There is a political judgment that has to be made at the end of the day, which in turn will reflect the view we take about the role this country should play internationally.

Let me move on briefly to my hon. Friend’s list of specific questions, which he threw in as a last-minute googly. I will try to do a bit better than simply saying I do not know in answer to them all. However, it is true that the answer to those specific questions depends upon what hypothetical alternative relationship this country would have with the continuing European Union were we to cease to be a member. Would it be a Norwegian, Swiss or Turkish model or something different? There would be different consequences in respect of any of those alternative arrangements. The answer must also then depend in part upon the nature of any alternative bilateral arrangements that could be put in place either with the continuing European Union or with third countries.

My hon. Friend mentioned free trade agreements. The position at the moment is that a country that is in a customs union with the European Union, such as Turkey, must extend access to its markets in line with whatever further free trade agreements the European Union negotiates with third countries, but it does not get the benefits of that greater access to the third country that EU member states enjoy. That is a source of strong complaint from Turkish Ministers about what they see as the unfairness of just being in the customs union without seeing progress towards full EU membership.

As for some of the work on arrest warrants, my hon. Friend knows that the Government are seeking to opt back into the European arrest warrant. However, before it existed, there were a series of bilateral arrangements deriving from the Council of Europe’s convention on mutual legal assistance, so alternatives could be put in place, although it would be a matter of political judgment whether they would be as effective as the EAW in providing for rapid extradition of serious criminals and criminal suspects in the cases that he described.

Martin Horwood (Liberal Democrat, Cheltenham)

Does the right hon. Gentleman imagine that those different arrangements in respect of the EAW and, indeed, other issues that we have been discussing would be negotiated in advance of the referendum, so that people knew what they were voting on, or subsequently?

David Lidington (Conservative, Aylesbury)

The EAW and the other elements of the decision required by the Lisbon treaty on pre-Lisbon justice and home affairs measures should be dealt with during 2014, because that is what the Lisbon treaty requires of us. The arrangements for any member state to leave the European Union are, of course, laid down in article 50 of the EU treaty. However, the Prime Minister has always made it clear that his ambition is to shape a process of European Union reform, involving some treaty changes and some measures that do not need treaty change, that will be in the interests of not only this country, but every European Union member state. He wants to try to restore some of the public confidence in Europe that has diminished so rapidly in not only the UK, but many other countries in recent years. As the Prime Minister said in his Bloomberg speech, he wants to be in a position, after successful negotiations, to put heart and soul into a campaign for continued United Kingdom membership.

I do not believe that the amendments are necessary. A future Government, when approaching a referendum in the next Parliament, will have every interest in making sure that the public and Parliament are well informed. Parliament will do its job of holding the Government to account and testing the policy implications of whatever recommendations the Government make to the country. During the campaign, through the designated umbrella campaign groups on each side of the argument, that case will be put to the public in very clear terms, and it is hoped that many other third-party groups in business and elsewhere will not be silent, but vocal in making sure that their opinions are understood.

Emma Reynolds (Labour, Wolverhampton North East)

Whether we write into the Bill an obligation on the Government to produce the reports should be something that we consider on Report. It is an important consideration, and I am not entirely convinced by the Minister’s argument. However, that is something that we should discuss at a later stage.

Martin Horwood (Liberal Democrat, Cheltenham)

Having spoken twice already, I shall not detain the Committee much longer. I would have been inclined to press the amendment to a Division, if there had been a sufficient likelihood of support from those on the Labour Benches. Although the hon. Members for Wolverhampton North East, and for Glasgow North East, have shown great stamina, that does not seem to have extended to some of their colleagues. I do not think that we have seen the right hon. Member for Leicester East since July.

In the circumstances, I shall not press the amendment to a Division, although I agree with the hon. Member for Wolverhampton North East that the proposals have raised some important issues. The one definitive reply given by the Minister—he said that in the case of a free trade agreement, we might end up with free trade agreement partners of the European Union having access to our market, while we did not have access to theirs—was an important and telling point. The importance of having reports or debates on research on such subjects is that they would reveal precisely those kinds of disadvantages to exiting the European Union. However, I beg to ask leave to withdraw the amendment.

Emma Reynolds (Labour, Wolverhampton North East)

I rise to speak to amendment 72, in clause 1, page 1, line 14, at end insert—

‘(7) (a) Before a referendum can take place, a body corporate known as the Committee on Britain’s Membership of the European Union, shall be established to issue a report on the costs and benefits of leaving the European Union;

(b) The body shall consist of no more than 19 members, none of whom shall be Ministers of the Crown;

(c) The members of the body shall be nominated by the Speaker of the House of Commons and the Lord Speaker of the House of Lords respectively, in accordance with the Standing Orders or Resolutions of their respective Houses, and subject to the approval of their respective Houses;

(d) Members of each House shall be members of the Committee until discharged by their House or if they cease to be a Member of that House or if they become a Minister of the Crown;

(e) The body shall elect a Chair from among those of its members who sit in the House of Commons;

(f) The body may determine its own procedure, which shall be broadly in line with that followed by Joint Committees of the two Houses; and

(g) after the body has issued a report, a motion shall be moved in each House of Parliament.’.

Amendment 72 would establish a Joint Committee of both Houses, which would be called the Committee on Britain’s Membership of the European Union. It would have responsibility for considering, in a dispassionate way, the costs and benefits of leaving the EU and the costs and benefits of our membership of the EU. The Committee would have no more than 19 members, none of whom would be Ministers of the Crown. Each House would be responsible for suggesting to the Speaker of their respective House nominations to the Committee. The Speaker of the House of Commons and the Speaker of the House of Lords would then duly nominate the members of the Committee.

I tabled the amendment because, as I said earlier in our deliberations, there should be an occasion for a Joint Committee of both Houses to consider the implications both of remaining a member of the European Union, and of leaving it. That Committee would have the chance to give in-depth consideration to those costs and benefits. However, this is a probing amendment and I do not wish to press it to a vote; it may be something that we come back to on Report.

In conclusion, consideration by a Joint Committee of both Houses could compensate, later in the day, for the lack of any pre-legislative scrutiny before the Bill was drafted.

Joe Benton (Labour, Bootle)

Amendment 72 is not moved.

Clause 2 - Entitlement to vote in the referendum

Barry Sheerman (Labour, Huddersfield)

I beg to move amendment 93, in clause 2, page 1, line 17, leave out from ‘would’ to end and insert

‘are British citizens resident in the United Kingdom and have attained the age of 16 years old.’.

Gary Streeter (Conservative, South West Devon)

With this it will be convenient to discuss the following:

Amendment 19, in clause 2, page 1, line 18, leave out ‘and’ and insert—

‘(aa) Persons who are legally resident in the United Kingdom, and’.

Amendment 20, in clause 2, page 1, line 18, leave out ‘and’ and insert—

‘(aa) Persons over the age of 16 who are legally resident in the United Kingdom, and’.

Amendment 21, in clause 2, page 1, line 18, leave out ‘and’ and insert—

‘(aa) All persons who are legally entitled to vote as electors in a European Parliamentary election, and’.

Amendment 22, in clause 2, page 1, line 18, leave out ‘and’ and insert—

‘(aa) All persons who are legally entitled to vote as electors at a local election, and’.

Amendment 23, in clause 2, page 1, line 18, leave out ‘and’ and insert—

‘(aa) All British citizens resident in any of the member states of the European Union, and’.

Amendment 24, in clause 2, page 1, line 18, leave out ‘and’ and insert—

‘(aa) All British citizens over the age of 16 resident in any country in the world, and’.

Amendment 25, in clause 2, page 1, line 18, leave out ‘and’ and insert—

‘(aa) All British citizens over the age of 16 resident in any of the member states of the European Union, and’.

Amendment 26, in clause 2, page 1, line 18, leave out ‘and’ and insert ‘citizens of Gibraltar, and’.

Amendment 71, in clause 2, page 1, line 20, at end add ‘but—

(i) would be entitled to vote as electors at a local government election in any electoral area in Great Britain,

(ii) would be entitled to vote as electors at a local election in any district electoral area in Northern Ireland, or

(iii) would be entitled to vote as electors at a European Parliamentary election in any electoral region by virtue of section 3 of the Representation of the People Act 1985 (peers resident outside the United Kingdom).

‘(2) In subsection (2)(b)(i) “local government election” includes a municipal election in the City of London (that is, an election to the office of mayor, alderman, common councilman or sheriff and also the election of any officer elected by the mayor, alderman and liveryman in common hall).’.

Amendment 43, in clause 2, page 1, line 20, at end insert—

‘(c) this Act shall not come into force until the disqualification of peers from voting as electors at parliamentary elections has been removed.’.

Amendment 76, in clause 2, page 1, line 20, at end insert—

‘(c) provision will be made so that all Britons resident in Gibraltar aged 16 and over will be able to vote in person or by post.’.

Amendment 77, in clause 2, page 1, line 20, at end insert—

‘(c) provision will be made so that all British soldiers resident abroad aged 16 and over will be able to vote in person or by post.’.

Amendment 78, in clause 2, page 1, line 20, at end insert—

‘(c) would be entitled to vote as electors at a European parliamentary election in any electoral region by virtue of section 3 of the Representation of the People Act 1985 (peers resident outside the United Kingdom).’.

Amendment 79, in clause 2, page 1, line 20, at end insert—

‘(c) This Act shall not come into force until the disqualification of peers from voting as electors at parliamentary elections has been removed.’.

Amendment 96, in clause 2, page 1, line 20, at end insert—

‘(d) provision will be made so that all Britons resident abroad aged 16 and over will be able to vote in person or by post.’.

Barry Sheerman (Labour, Huddersfield)

It is lovely, Mr Streeter, to see you chairing the Committee. We go back a long way in terms of experiences in the House.

It gives me great pleasure to move the amendment, because it shows a true spirit of openness to ideas. Many in the House will know that I am a passionate opponent of votes at 16. I have spoken about the issue and blamed the right hon. Member for Bermondsey and Old Southwark (Simon Hughes) and my right hon. and learned Friend from just up the road, the Member for Camberwell and Peckham (Ms Harman), the deputy leader of the Labour party, for wishing it on our party. In the spirit of openness to ideas, I thought that because the First Minister in Scotland has climbed on the votes at 16 bandwagon for the Scottish referendum, it is only right for us to discuss and debate it through this important private Member’s Bill. The amendment is probing and I intend the issue to be fully discussed today. There will be a referendum in Scotland with votes at 16, so I can see that there is a case to be made for votes at 16 in referendums.

My position is that I could accept votes at 16 in a referendum on this important issue, which will be of significance to the lives of young people for a very long time—I am not persuaded at the moment, but I could be. Years as Chairman of the Select Committee on Children, Schools and Families taught me the preciousness of childhood. I would not find defensible anything that squeezed childhood ever further. Many of the protections of children and childhood go through to 18—not all of them; there is a balance. Some go through to an earlier age and some to a later age. We should discuss votes at 16, but I think that it is a bit of a gimmick, even in Scotland. I knew the First Minister well when he was in the House of Commons. I did not have a very high opinion of him in those days and nothing has happened to change my mind.

As I pointed out in the House fairly recently, when the very highly respected Hansard Society, chaired by the Speaker, looked into voting patterns and voting potential, it found that only 12% of young people between 18 and 25 were likely to vote in the next election. That is astounding. I shall say only one party political thing in moving the amendment. When I conducted a major inquiry into citizenship in schools, I found that, where citizenship is well taught, it is very good indeed. It is a whole-school enterprise, not something stuck into the timetable a little bit every week or fortnight. There can be a bit of a knee-jerk reaction to citizenship, which may be taught by someone not trained in teaching it. Even if I could be persuaded on votes at 16, I would want, in parallel, highly organised citizenship preparation for that voting opportunity.

Although I have reservations, we should discuss votes at 16, given the Scottish precedent. This is a private Member’s Bill, and its promoter may accept the amendment with open arms. He might be passionate about votes at 16; I do not know, because I have not seen his position on the record. I know him to be a sensible Member. He may want to intervene on me and let me know how he feels about it in respect of his Bill

James Wharton (Conservative, Stockton South)

I cannot ignore the hon. Gentleman’s kind invitation to make known my own feelings on the matter. I do not know whether his intention is to persuade the Committee or to persuade himself, but he is unlikely to persuade me that votes at 16 would be a good idea for this referendum or for future elections.

Barry Sheerman (Labour, Huddersfield)

I thank the hon. Gentleman for that intervention. It looks like I will soon flush out the promoter of the Bill. I know he will tell me in a moment whether he would like to see this amendment in his Bill. Of course knowing which way he was disposed on the matter would weigh very heavily with my colleagues and me. My own opinion is that, given the Scottish precedent, we would have a lot of explaining to do if this were not thoroughly discussed in Committee. I moved the amendment to start a short discussion about whether the amendment was relevant and to see whether the Committee feels that it would move the Bill on. Those who want to see a vote in a referendum could make an assessment of whether this would be useful in terms of not just the narrow point of winning or losing a referendum but being inclusive of the whole population.

Mr William Bain (Glasgow North East) (Lab) rose—

Barry Sheerman (Labour, Huddersfield)

I was about to sit down.

William Bain (Labour, Glasgow North East)

I am most grateful to my hon. Friend for giving way. I caution against postponing his peroration, but I just wanted to share with him and the Committee what is happening with 16 and 17-year-olds in Scotland at the moment. They are remarkably cynical that Scotland’s First Minister is seeking to give them the vote. It is only for this referendum of course, because they would not have the vote for any other referendum or election. They are remarkably cynical and think they are being given the vote because the First Minister believes that they will vote in the way that he intends. What we are actually seeing is 16 and 17-year-olds saying that, if they are going to have the vote, they should have the vote for every election and not just for a single plebiscite or referendum.

Barry Sheerman (Labour, Huddersfield)

I could not agree more with my hon. Friend. When I saw that Alex Salmond had made that commitment, it did seem that it could well be perceived as a gimmick to try to get that extra vote from young people. As some have said, those young people do not yet fully understand the full ramifications of the vote in which they might be asked to participate. It is an important matter. One could argue that it is the thin end of the wedge—even in a referendum, as important as it is. As I have said, they are being allowed to vote because it is an important and long-lasting decision that will change the very nature of our social and economic region. If it is that important, people could say, “Well, what about local elections? What about elections for mayors?” What about any election that we want to involve young people in? I suspect that, if we allowed this for the referendum, we would be pretty much committed to votes at 16 in all those elections for local government and mayors and for parliamentary elections.

I know that I am not expressing the policy of my party. I am not revealing anything secret here, but I did have a vigorous conversation with the person who wrote the Labour manifesto running up to 2010 on my worries and concerns that the impact on children and childhood had not been taken into account. I met him that day in his ministerial office just down the road from here. He is now leader of the Labour party. The fact is that this matter should be discussed. It is an important contribution. I am keen to know whether the promoter of the Bill would like to support the amendment.

Martin Horwood (Liberal Democrat, Cheltenham)

It is a pleasure to see you in the Chair, Mr Streeter. You may find this to be a slightly bizarre Committee. On the hon. Member for Huddersfield’s speech, I have to say that that is the first time I have ever heard someone propose an amendment and then declare themselves unconvinced by it. That is yet another first for this amazing Committee.

I added my name to a series of amendments tabled by the hon. Member for Ilford South (Mike Gapes), who found himself, for good or ill, not a member of the Committee. These amendments probe the various aspects of the qualification to vote in the referendum and it will be helpful to debate them.

Some strange anomalies and issues have been raised, as the hon. Member for Huddersfield mentioned, by the debate on who should be qualified to vote in the Scottish referendum, whether that should extend to votes at 16, and indeed the wider discussion about votes at 16. I do not find myself in a particularly difficult position in that respect as I have always supported votes at 16 for all elections. Therefore, I do not mind arguing for that, particularly in the case of a referendum, whether Scottish or European.

The first amendment tabled by the hon. Member for Ilford South but also in my name is amendment 19, which would insert between the two existing paragraphs in the clause an additional one qualifying any person who is legally resident in the United Kingdom to vote. I have not discussed that with the hon. Gentleman, but I think the logic was that potentially this will be a vote on an international issue with implications wider than the United Kingdom itself. Let me turn to the principal difference between that potential electorate and those currently qualified to vote in a UK general election. At the moment, only citizens of the Republic of Ireland and the Commonwealth, in addition to British citizens with the various different qualifications, have the right to vote. Citizens of other EU countries that are not members of the Commonwealth do not; nor do citizens of completely different countries, such as the United States of America. I would guess that it is possible to be legally resident in the United Kingdom and be a citizen of virtually any country, so the amendment is particularly broad in its suggestion and it would be interesting to see what the Minister for Europe, with his ministerial experience, has to say on that.

There is a logic to saying that on an issue with broad international implications, and implications for the freedom of movement between the United Kingdom and other European countries, perhaps we should allow some input from citizens of countries other than just our own, and certainly from those of other European countries who might be significantly affected. The precedent is set by our local and European elections, where citizens of other European countries are allowed to vote. It is not as if we have a narrowly drawn principle of who can vote even in our own local elections—or, in fact, the general elections, because of the Commonwealth and Irish qualification to vote as well. We do vary and flex the qualification, so the amendment deserves debate.

I am slightly more comfortable with amendment 20, which takes the same principle but extends eligibility to vote—as do a couple of the other amendments—to those aged 16. I think that votes at 16 is desirable; I have argued for it for many years on a number of bases. The first is the driving of political engagement between politicians and young people at a time that is formative for young people in their political ideals. I do not know whether I am representative of the United Kingdom—I am probably not, being a bit of a political geek, as all of us here are—but my political ideas began to be formed at that kind of age: between 16 and 17.

When I engage with school students, I find them much less cynical and more open-minded about politics than perhaps even university students a couple of years down the path. It would seem to be very positive to engage people in the voting and decision-making process at that slightly younger age. Some of them occasionally suggest to me that they do not feel they have all the knowledge required to vote in elections at that age, and I tell them that they should go out and meet the rest of the electorate some time, because a lot of people vote without any knowledge whatsoever. The principle of a democracy is that every vote counts, and everyone who has the good sense to understand that they need to have knowledge in order to vote and form a judgment should be entitled to do just that.

Barry Sheerman (Labour, Huddersfield)

May I bring the hon. Gentleman back to that famous debate we had—on a Back-Bench motion, I think—in the House last year? Many of us joined in and it was a good debate on both sides, and the case he is making now was made passionately well then. What he has just said is equally applicable to 14-year-olds, so why 16? Why not have voting at 14, or 12?

Martin Horwood (Liberal Democrat, Cheltenham)

It is a matter of degree, and there is a degree of maturity involved in reaching the age of 16 that simply is not there at 12 or 14. I notice that difference with work experience students who come into my office. Year 12 and 13 students have a maturity and an interest in the issues that simply is not there even a couple of years earlier. There is a logical distinction there.

The second reason I think that votes at 16 are a good idea, is that 16 is the age of majority in many other respects. It is not an absolute rule, but someone can get married or fight for their country at 16.

Barry Sheerman (Labour, Huddersfield)

I am tired of that being trotted out. Someone can get married or join the Army at 16 with the consent of their parents. It is true that there is a range of things, some of which can be done earlier and some later, but the trouble with the hon. Gentleman’s case is the argument that the age should be brought down to 16 because 16 consolidates the end of childhood.

Martin Horwood (Liberal Democrat, Cheltenham)

I am afraid I disagree. The point is that they can do those things. Perhaps we should not have that qualification that someone can join the Army with parental consent as a safeguard to protect younger people, but it does not change the fact that they can be serving members of the armed forces at 16, and it certainly does not prevent them from getting married.

Barry Sheerman (Labour, Huddersfield)

It does.

Martin Horwood (Liberal Democrat, Cheltenham)

But there is still a difference between being able to get married with parental consent at 16 and before the age of 16 not being able to get married at all. There is recognition in law that at the age of 16 something changes and people reach a certain maturity, and there is therefore a change in their legal status. That is undeniable.

Barry Sheerman (Labour, Huddersfield)

I have an unfortunate reputation already for being a bit ageist—but not sexist, I have three daughters who keep me line. I have met a large number of women with children, including boys, but have the people who want votes at 16 ever met a 16-year-old boy? I point that out in a slightly amusing frame. I always ask, “If one of your children wanted to marry at 16, how happy would you be?”

Martin Horwood (Liberal Democrat, Cheltenham)

It would depend on who they wanted to marry. Logically, having put my views on the record on the matter, I would absolutely endorse a marriage at 16 if I thought it was the right thing for my daughter or son, and I would do my best to respect—[ Interruption. ]

Gary Streeter (Conservative, South West Devon)

Order. The Committee has been so well behaved, but it might be useful to focus again on the amendments. Sedentary interventions are never helpful.

Martin Horwood (Liberal Democrat, Cheltenham)

Thank you, Mr Streeter, for drawing us back on to the straight and narrow—not that we are against gay marriage either.

The third argument is that of no taxation without representation. People can take up apprenticeships, earn money and pay tax at 16, and revolutions have been fought over the right to be represented if taxed. In the case of the European referendum there is an additional argument—I think the hon. Member for Huddersfield mentioned it in his remarks—which is that that right is even more essential with something of generational importance. Someone’s vote in a local election lasts for only four years, and in a general election only five, but their vote in a referendum on membership of the European Union will have implications for decades to come, at the very least. If the vote is to stay in, we may find that there is not another opportunity to vote on that for an entire generation—as my own generation has found, having not the chance to vote in the original referendum on membership. If we vote to leave the European Union that will have profound implications for generations of young people. To try to push the boundary a little and allow more young people a say in this referendum is, therefore, an entirely laudable aim.

Amendment 21 seeks to extend the vote to:

“All persons who are legally entitled to vote as electors in a European Parliamentary election”.

In a similar vein—given that, in practice, it has the same effect—amendment 22 would include:

“All persons who are legally entitled to vote as electors at a local election”.

That goes to the heart of the rather strange anomaly where we are allowing all Commonwealth and Irish citizens to vote in some of our elections but not allowing other EU citizens to vote in some of them. In terms of the parliamentary franchise we are left with bizarre scenarios in which somebody who is a citizen of the Republic of Ireland can vote but somebody who is a citizen of the French republic cannot. A citizen of Luxembourg cannot vote but a citizen of Singapore can. A Maltese citizen of the European Union can vote, because Malta is a member of the Commonwealth, but a German representing a far greater and in many ways more important economic relationship cannot vote. An Italian cannot vote but citizens of Mozambique, Belize, Rwanda or Tonga can vote. Although I can understand the historical origins of this anomaly, it is still an anomaly and a rather strange one.

William Bain (Labour, Glasgow North East)

May I point to another anomaly that would arise, given the current phrasing of the Bill? As the hon. Gentleman will know, in the Scottish referendum the franchise is based on the Scottish parliamentary electoral franchise. That means that EU citizens will be permitted to vote. As he will also be aware, if Scotland chose to leave the United Kingdom it would effectively be choosing to leave the European Union as well, thanks to the advice that the Minister for Europe and his other colleagues in the Foreign and Commonwealth Office have helpfully provided in the campaign. Does the hon. Gentleman not think that it would be a very strange position if a French or Italian citizen could vote effectively to choose whether to stay in the EU in the Scottish referendum but could not vote in any referendum arising from this Bill?

Martin Horwood (Liberal Democrat, Cheltenham)

That is exactly right. That is just one of the ludicrous scenarios that might develop, where we might have Scottish citizens who were legally able to vote in England as members of the Commonwealth actually voting to kick England out of the European Union while simultaneously, perhaps, supporting Scottish membership of the European Union. Weird scenarios might develop. It is time—probably in other respects than just the EU referendum—to try to iron out some of those anomalies and problems. It is ludicrous enough in the context of a general election, but it is quite ludicrous in the case of a European referendum, when we are talking, for instance, about European citizens who have decided to make a life here and have never felt the need to abandon the citizenship of their home countries—given that in practical terms it made very little difference to them—but for whose work and livelihoods the implications of the European referendum on the exit of the United Kingdom from the European Union might have profound implications. It is absolutely right that they should be entitled to vote.

Amendment 23 has a slight variation; it looks at the situation from the other end of the telescope, if you like. The amendment allows:

“All British citizens resident in any of the member states of the European Union”

to vote. Some of those citizens are already entitled to vote in a general election, so will already be covered in the franchise. British citizens abroad, if they have lived outside the UK for less than 15 years, are entitled to vote in a general election as long as they were registered to vote in the UK at some point; therefore they would be included in the franchise, as already envisaged in the Bill. The amendment seeks to extend that to all British citizens in EU states.

When we think about how many British citizens have taken advantage of the freedom of movement for people within the European Union to go to live and work in Germany, or Spain, or France, or we think about how many have retirement homes in Tuscany—various new Labour ex-Ministers might well be enjoying the Italian sun at this moment—it is quite easy to see that there are people whose lives could be affected by a sudden decision from Britain to exit the European Union. If the relationship between the UK and the European Union suddenly became uncertain, or was cast into doubt, that could affect those people’s rights of residence in the countries that they have adopted or in which they are building businesses; it could affect the lives and careers they have planned and the businesses they have built up. There is therefore an argument for extending the franchise for the referendum to include all those British citizens living in EU member states.

Amendment 24 combines the thoughts behind amendments 23 and 20: it would include in the franchise for the referendum all British citizens

“over the age of 16 resident in any country in the world.”

In fact, as the amendment mentions any country, anywhere in the world, not just within the European Union, it would extend the franchise much further. It is quite a radical amendment from the hon. Member for Ilford South, but it deserves some discussion. In a way, the amendment would bring the Bill into line logically with the voting entitlement in a general election, which includes British citizens anywhere in the world providing that they meet the time and registration qualifications I have already mentioned. However, I believe the stronger case is for allowing a broader range of citizens resident within other European member states to vote in the referendum. Amendment 25 combines the lower age threshold of 16 and the idea of residency in any member state of the European Union.

Amendment 26 is slightly different. It seeks to tackle an obvious and strange anomaly concerning the citizens of Gibraltar. As Gibraltar is a British overseas territory and is not constitutionally part of the United Kingdom, citizens of Gibraltar cannot vote in the general election and so would be excluded from voting in the referendum. However, Gibraltar is a part of the European Union; in fact, the citizens of Gibraltar are in the same European parliamentary constituency as I am: Cheltenham is part of the south-west electoral region, which includes Gibraltar. My European parliamentary colleague, Sir Graham Watson, is very proud of the fact that he represents Gibraltar alongside Cheltenham, Devon and all the places in the south-west, and makes occasional trips to the Rock to meet his constituents. Especially in the context of the argument that we are making to Spain—that it is up to the citizens of the Rock to decide their own future and that they have twice made the case in a referendum that they want to stay within the United Kingdom—it would be completely bizarre not to allow them a say in whether or not they are removed from the European Union.

I am sure that was not the intention of the promoter of the Bill, and I would be interested to hear his comments on that subject. We are often in contact with the Government of Gibraltar in this place—from time to time quite a lot of lobbying goes on—and I am sure they would be interested to hear the views of Conservative Members on this issue. It might even be said that the importance of clause 2 could be connected less to the EU referendum and more to the gift it could hand to those within Spanish politics who want to make a fuss about our giving people the right to vote in referendums only when it suits us.

James Wharton (Conservative, Stockton South)

Despite my fear of drifting too far from the amendment in question, Mr Streeter, I think it is important to put on the record that my view—and, I suspect, that of Conservative members of the Committee—is that it must be up to the people of Gibraltar to decide whether they wish to remain in the UK. There is no intention that anything in the Bill should give succour to the claims of the Spanish Government in that regard, and nothing in the Bill that could do so. It is important that that is on record. There is a difference between the franchise for European elections and for parliamentary elections in the UK, as Gibraltar does not have representation in the House of Commons. Although there is a lengthy and interesting discussion to be had about that, for the purposes of the Bill itself, as drafted it does the job in terms of the franchise for the referendum.

Martin Horwood (Liberal Democrat, Cheltenham)

I am grateful for the hon. Gentleman’s intervention. I appreciate the sentiments that he states and they are very welcome. However, what he eventually concluded was that he was not going to accept this change to the Bill and is therefore going to exclude the citizens of Gibraltar from a vote in the referendum, despite the fact that it will have the effect of excluding them from the European Union. They are only members of the European Union by virtue of our membership. Therefore, if they wanted to continue as members of the European Union—rather parallel to the situation in Scotland—they would presumably have to reapply as a member in the same way that other very small states such as Malta have done. Their chances would be very, very slim because Spain would immediately seek to veto that membership and it would be blocked in the same way that, for example, Macedonia’s membership has been blocked by Greece.

This is a critical issue for the citizens of Gibraltar. If we really face the prospect of exit from the European Union, are we saying that they would not have any kind of say in something that might materially affect their lives? The importance of that border turning from an internal EU border into one between the territories of the United Kingdom and the European Union, might be quite significant and could give those in Spanish politics who want to make mischief out of this, an opportunity to argue for new tariff barriers or new obstacles to the free movement across the Gibraltar-Spanish border. I accept the sentiment of what the hon. Member for Stockton South was saying, but he does not seem to have accepted the really important point which is that the Bill as it stands does not solve the issue at all.

Amendment 71 stands in my name and is an alternative approach to resolving the issue of voting. I am sure that the Conservative members of the Committee will support the inclusion of this wording, particularly the Europe Minister as a member of the Government, given they have all voted for it on a previous occasion. The wording is lifted directly from the 2011 Parliamentary Voting System and Constituencies Bill on the alternative vote which coalition MPs—and certainly Ministers—were whipped to support. It basically sets out a franchise that entitles all those electors entitled to vote at a local government election in Great Britain and Northern Ireland to vote in the referendum. If it was good enough for the AV referendum, surely with all these additional arguments and the obvious connection to European Union citizens in this country, it should be good enough for the referendum on membership of the European Union. If hon. Members are going to vote against it on this occasion, they will have to explain to the Committee why they supported it in the case of the AV referendum.

I will leave comment on the other amendments until after I have heard the supporting arguments from other hon. Members.

Emma Reynolds (Labour, Wolverhampton North East)

It is a great pleasure, Mr Streeter, to serve under your chairmanship. I will start by speaking to amendment 76. As the hon. Member for Cheltenham has already suggested, given that Gibraltar is a part of the EU by virtue of being a self-governing British overseas territory, for the people of Gibraltar not to have a say in something that is going to affect them so directly is something that we should discuss. I welcome the intervention of the hon. Member for Stockton South, who may disagree, but I am glad to see that he is participating in this part of the debate.

This issue needs to be considered. If a referendum takes place on our membership of the European Union, as set out in this Bill, then we could have a scenario in which the people of Gibraltar are not included and the rest of the UK votes to leave the EU. The people of Gibraltar will be affected but will not have had a say in the matter. I would go so far as to say that not only should the good people of Gibraltar be included in the franchise, but that their vote should be counted separately and put on the record, in case we do end up leaving the European Union and they wish to remain in it. As the hon. Member for Cheltenham set out, it would be difficult for them to apply successfully, given the ongoing and recent escalation of tension with Spain around the border area and Spain’s claim of sovereignty of the Rock

As the hon. Member for Stockton South pointed out, all Members here and many across the House condemned the recent protests and acts of the Spanish Government, and the fact that Spain is trying to flex its muscles. As they are in a bit of trouble, the Spanish Government are trying to score some cheap political points. However, it is still worth reflecting on the democratic deficit that would apply if we had a referendum that affected the people of Gibraltar without them being included in the franchise. I am interested to hear what Members think about my amendment 76 and amendment 26, which was tabled by the hon. Member for Cheltenham.

There is a strong case for including the people of Gibraltar in the franchise. I have written to the Chief Minister of Gibraltar and spoken to some of his advisers about the omission of Gibraltar from the Bill and I am interested to hear what the Minister for Europe has to say on this important matter.

Martin Horwood (Liberal Democrat, Cheltenham)

There is an interesting historical parallel, although it is exactly the other way round: the 1985 referendum in Greenland on EU membership. Greenland, which is an overseas part of the kingdom of Denmark, but not part of the Danish state that now remains within the EU, voted to leave the EU. It was given a vote separately from the mother country on its future within the EU. That is the precise right we are apparently not going to extend to the people of Gibraltar.

Emma Reynolds (Labour, Wolverhampton North East)

This is a basic argument. If the people of Gibraltar are to be directly affected by this referendum in terms of membership of the EU, they should have a say. I hope that the arguments that I and the hon. Member for Cheltenham have put forward are being heard by the Minister for Europe and the hon. Member for Stockton South, the promoter of the Bill. I heard what he said a minute ago, but perhaps he will take on board our arguments. This is an important omission from the Bill and something that we need to discuss in greater detail.

I agree with my hon. Friend the Member for Huddersfield that we need to discuss whether people aged 16 and 17 have a vote in the referendum. I am sure we could have a lively debate on the general principle of votes at 16, but I want to focus my remarks on what the hon. Member for Cheltenham said about the Scottish precedent. One argument for allowing 16 and 17-year-olds to vote in the Scottish referendum is that such a referendum probably will not be held again for many generations to come. I hope that it does not and that it will settle the issue.

I hope that the referendum in September next year on whether Scotland remains part of the Union will draw a line under the issue. Therefore, even for those members of the Committee not in favour of extending the franchise to 16 and 17-year-olds for general, local and European elections, there is still an argument for allowing people of that age to vote in a referendum, either on keeping Scotland in the UK—my opinion on that subject is clear—or on our membership of the EU. That is precisely because, as the hon. Gentleman pointed out, it is a generational opportunity—one that does not come around very often—on a matter that has very profound and wide-reaching implications: either whether Scotland should be part of as the UK; or the UK’s role in and membership of the European Union.

Extending the franchise for the referendum to 16 and 17-year-olds deserves greater scrutiny. Regardless of what one’s position might be on the general principle of voting at 16, there is a specific case to be made for younger people to be involved in life-changing, generational referendums. I might even have convinced my hon. Friend the Member for Huddersfield—he is nodding his head at me—to support his own amendment, which truly would be something that I could say I had achieved this afternoon.

My other amendment to which I wanted to draw the Committee’s attention is amendment 77. With such a referendum, it is important that British service personnel serving abroad are given the opportunity to express their opinion. I know that this does not happen very often, but sometimes 16 and 17-year-olds serve abroad, and they should also be involved in the referendum. Hon. Members will have different opinions about whether 16 and 17-year-olds should have a say in the referendum, so we will scrutinise that matter in more detail on Report.

David Lidington (Conservative, Aylesbury)

First, may I welcome you to the Chair, Mr Streeter? When I saw Mr Benton following this morning’s sitting, it looked as if a great load had slipped from his shoulders.

We have had a good-natured and useful debate on the amendments. My starting point is that the electoral arrangements for which the Bill provides have a coherence and logic to them. As my hon. Friend the Member for Stockton South said, they deliver what the Bill requires to put a fair question to the people of the United Kingdom. The Bill proposes a general election franchise with the addition of Members of the House of Lords, who would normally be excluded from voting in a House of Commons election.

What we have heard from the hon. Members for Wolverhampton North East and for Huddersfield and my hon. Friend the Member for Cheltenham is a series of proposals as to how that franchise might be varied. I will make one general point before going through some of their specific proposals.

I think it would be perfectly reasonable, even though I might not agree with the proposal, to say, “Right, we need a new Representation of the People Act through which we seek to lower the voting age, to extend the franchise or to lengthen the period of time during which expatriates remain entitled to vote for all elections and referendums in the United Kingdom.” However, despite the valiant efforts of the hon. Lady and my hon. Friend in respect of the voting age, I am not persuaded that there is something so exceptional about this proposed referendum that we should experiment with changes to the established general election franchise. The subject might be aired in a future Parliament in a debate on a Representation of the People Bill, and that would be the right context in which to hold such a debate.

It was on the point of the voting age on which the hon. Lady and my hon. Friend pressed their case most strongly. I understand the argument that a referendum on our membership of the European Union is life changing or a once-in-a-generation experience, but that could have been said about the proposal for Scottish devolution, and it certainly could have been said about the referendum to endorse the Northern Ireland peace settlement. It might have been just about plausible to argue that in respect of the referendum on the alternative vote, because had the voting system been changed, the probable make-up of future Parliaments and the way in which we do government in this country would have altered quite dramatically.

Martin Horwood (Liberal Democrat, Cheltenham)

The logical difference with the AV vote is that, of course, the AV vote related specifically to Westminster elections. As I have explained, although the franchise for the referendum extended to those who could vote in local elections, there was something of a logic to not extending it to 16 until the vote itself had been extended to those aged 16, because otherwise we would have had the rather strange situation in which 16-year-olds were able to vote for the alternative vote but would not have been able to exercise it for another two years. The Minister can see that that would have been an anomaly, but perhaps he can answer this: why was there a franchise that allowed those who could vote in local elections to vote in the AV referendum, yet there is no such provision in the Bill?

David Lidington (Conservative, Aylesbury)

My hon. Friend will have to take up that question with those colleagues, led by the Deputy Prime Minister, who were responsible for that referendum. One can argue for and against changing the age at which people are entitled to vote, and I accept that there are different views in the Committee about that principle. However, I am not persuaded that there is something uniquely important about the proposed referendum on membership of the EU that justifies a different franchise from that at a general election or at another referendum—either ones that we have already held, or those that we might hold in future.

On the general principle of voting age, there is an honest disagreement between the two parties of the coalition. The Liberal Democrats have for some time championed lowering the age to 16, but I tend to be with the crustier tendency on this issue, along with, I think, the hon. Member for Huddersfield. I remember a meeting with 150 girls of the Aylesbury high school sixth form at which this subject came up. When I put the question, “Would you have the confidence to entrust to the maturity and good judgment of the average 16-year-old boy a decision about the future Government of this country?” I saw a look of horror appearing on their faces straight away. My view is very firmly that we should leave the voting age at 18, but I am sure that Parliament will want to return to that debate in a broader context, outside the confines of the Bill.

Amendments 19 to 26 deal with the franchise and suggest that we include citizens of other EU countries who are not already covered by virtue of Commonwealth citizenship. Amendment 19 would extend the franchise to everybody who is legally resident in the United Kingdom, but that really goes a bit too far. I just cannot understand the case for why, for this referendum, we should enfranchise people from China, Russia, Paraguay or Iran. I stick to the principle that the United Kingdom’s membership of the European Union really should be determined by people who live permanently in the United Kingdom and are entitled to vote in our general elections. I understand the case that my hon. Friend and others have made for using the local election franchise and extending the vote to citizens of other EU countries, but British citizens would find that hard to swallow. We have large numbers of people from other EU countries here, and London is something like the seventh-largest French city, which is why French presidential candidates come over here during their election campaigns. However, the decision should be primarily for British citizens.

Martin Horwood (Liberal Democrat, Cheltenham)

That would be a logical argument if the general election did not already comprehensively break that rule. A citizen of Mozambique who has leave to remain can vote by virtue of Mozambique’s membership of the Commonwealth. Any citizen of the Irish Republic over the age of 18 can vote even if they are not normally resident in this country, as long as they have an address at the time of electoral registration. The principle is comprehensively broken under the existing general election franchise.

David Lidington (Conservative, Aylesbury)

As my hon. Friend knows, there are slightly different historical reasons for the franchise covering citizens of the Irish Republic and of Commonwealth countries. If the Liberal Democrats are now arguing that we should withdraw the vote from citizens of the Commonwealth who are resident in this country, that would be an interesting policy proposal. In fairness, I do not think that that is quite what my hon. Friend is arguing for.

Martin Horwood (Liberal Democrat, Cheltenham)

Extremely briefly, and for the record, I would like to confirm that that is certainly not Liberal Democrat policy.

David Lidington (Conservative, Aylesbury)

I thought that that might be the response.

We sometimes have arrangements in this country that derive from a theoretical logic and we sometimes have arrangements that are the product of a historical logic because of how our institutions have developed, which is the case with our general election franchise. I do not really see why we should make an exception here.

Some interesting references were made in passing to the 15-year limit beyond which British citizens living overseas lose the right to vote. I go back quite a long way in politics and can remember—it was over 20 years ago and before I joined this place—that when expatriate voting was first permitted, there was a longer time limit. I believe that the limit was 20 years and the measure was taken through under John Major’s Government with cross-party agreement. It was the Blair Government who followed, however, who decided to reduce the entitlement to vote to include expatriates who had been away for only 15 years or less. There is a decent case for looking at those rules again. We are in a global economy and more and more people choose to work in and retire to other parts of the world, but that is best addressed in the context of a wider revision of our electoral law, not in this Bill.

Finally, I want to come on to the difficult question of Gibraltar.

Martin Horwood (Liberal Democrat, Cheltenham)

Just before the Minister moves on to Gibraltar, a couple of amendments refer to one other small, repressed minority that we have not really debated yet: our noble Friends down the corridor who are not entitled to vote in general elections by virtue of their membership of the other half of the legislature, but who logically should be entitled to vote in a European referendum. I am sorry that we did not get a speech from the hon. Member for Huddersfield as I am not sure he is persuaded by his own case on that, but it would be interesting to hear the Minister’s response.

David Lidington (Conservative, Aylesbury)

If my hon. Friend looks again at clause 2(b), he will see that peers who would normally be disqualified from voting because they sit in the House of Lords would be enfranchised for the purposes of the referendum.

Barry Sheerman (Labour, Huddersfield)

The reason for that amendment was that we thought it was about time that we had a discussion. We are reflecting on what we took for granted—that people who are mentally ill or in prison cannot have a vote in general elections. All that is up for debate and discussion, and still we have the anomaly whereby Members of the House of Lords do not have votes in general elections. It just seemed an appropriate time to mention that. The Bill is an important one, and we thought that we should reflect that challenge.

David Lidington (Conservative, Aylesbury)

I do not think that it is unreasonable for us to follow historical practice: Members of the upper House, who by virtue of their person and status as peers are legislators in that Chamber, should not have the additional right to vote for the composition of the lower House. There is a logic to those arrangements: if someone sits in one place, they do not vote for the other.

If the hon. Gentleman checks my voting record on House of Lords reform, he will see that I have voted consistently for a wholly or mostly elected upper House. If we get to that state of affairs, there would be a strong case for looking again at the arrangements and saying that someone who sits in one House should be able to vote for Members of the other House. That would be the occasion on which we might want to revisit his question.

Regarding Gibraltar, I have a lot of sympathy for what the hon. Member for Wolverhampton North East and others have said. However, the question is quite complicated. I readily understand why one’s instinctive emotional reaction is that Gibraltarians should have a vote in the referendum, particularly as they are EU citizens and are voters in European parliamentary elections, but there are some obstacles to that argument.

First, Gibraltar is not part of the United Kingdom; it is a British overseas territory. Its involvement with the European Union—or, to be more accurate, with parts of the European Union acquis—derives from the United Kingdom’s accession and continued membership of the European Union. There are other British overseas territories listed in protocols to the European treaties whose citizens do not have the same rights as those of Gibraltar, but which enjoy certain privileges in respect of EU membership. Those, again, derive from the United Kingdom’s decision to join and remain a member of the EU.

Barry Sheerman (Labour, Huddersfield)

The Minister has been doing exceedingly well. He has been persuasive this afternoon, and he was giving an excellent performance until he got to this. The most persuasive case that we have discussed today has been that of Gibraltar. It is new knowledge to me—it is nice to have new knowledge—that we have that constituency in the south-west, with an elected Member. That is different from any of the cases that he has just mentioned.

David Lidington (Conservative, Aylesbury)

That is absolutely right; it is different. What is also the case, however, is that Gibraltar is not a member state of the European Union. Not only that, Gibraltar neither enjoys all of the rights that come with EU membership nor incurs all the obligations that flow from membership. For example, Gibraltar does not contribute to the EU budget. It is not in the single market for goods and services. It is party to some of the acquis, but there are chunks of European law and treaties from which Gibraltar is excluded. That is not through any malice on the part of the United Kingdom, Spain or anybody else, but because that was the deal that was agreed and that we negotiated on behalf of Gibraltar. That was in line with how the Government of Gibraltar and their successors saw the interest of Gibraltar.

Barry Sheerman (Labour, Huddersfield)

The big difference is that that overseas territory is the only one where a referendum decision could absolutely imperil its future existence and put its status in Europe at risk. The repercussions of the UK leaving the EU could be catastrophic for the citizens of that small place, unlike any of the other places mentioned.

David Lidington (Conservative, Aylesbury)

I think Gibraltar would be affected by a British decision to leave, but the extent to which our leaving harmed or benefited Gibraltar would depend in part on the alternative arrangements that were negotiated. I do not believe that our exit would be catastrophic for Gibraltar. We need to keep in mind the fact that Gibraltar has its own constitution, which came into effect in 2006 and gives the Government of Gibraltar, who of course are elected by the people of the Rock, full power over pretty much everything that we would define as domestic policy, and the UK Parliament does not intervene in those matters.

I am particularly aware at the moment that matters such as marine conservation and fisheries policy fall within the constitutional competence of the Government of Gibraltar, who are accountable to the elected Parliament of the people of Gibraltar and not to us. However, the 2006 constitution also provides that the Government of the United Kingdom remain constitutionally responsible for foreign and external affairs, for defence and for some aspects of Gibraltar’s security. That includes decisions about membership of international institutions—not just the EU, important though that is—and it means that we have responsibility for looking after Gibraltar’s interests when it comes to other international organisations.

Martin Horwood (Liberal Democrat, Cheltenham)

The Minister is attempting to answer, but it seems like a giant exercise in post-rationalisation, because that is an exact parallel situation to the one with Greenland, which did enjoy self-government, although not as much as it does now. It allowed foreign affairs and various other aspects to be run by Denmark, but it did have a vote on its status within the European Union, and indeed exercised that right to vote in order to leave the European Union. We are not going to give that right to Gibraltar, even though I think there could be a catastrophe, because there is every incentive for Spain to play hardball in the relationship between the EU and Gibraltar, safe in the knowledge that if the United Kingdom had already voted to leave, we were never going to reverse that decision simply to protect Gibraltar’s interests. I think it would be extremely vulnerable to a harsh interpretation of the relationship.

David Lidington (Conservative, Aylesbury)

I do not think the parallel is an exact one, because, in the case of Greenland, the member state concerned—Denmark—was not proposing to leave. The Danish Government agreed, along with the rest of the EU, that there should be a separate decision in Greenland about whether to be part of the EU, and they agreed to abide by the referendum decision. The nearest analogy in our own experience is the deal that the then British Government negotiated on behalf of Gibraltar, which gave it access to the parts of the acquis that were regarded as in Gibraltar’s interests, but kept it out of others. I do not see the two parallels as being exact. We were not talking at the time of the Greenland decision about a decision by the member state—Denmark—to alter its status.

Barry Sheerman (Labour, Huddersfield)

The Minister is almost answering my question, but not quite. I do not know enough about Greenland and whether it could vote for Danish representatives to represent it in Europe. The difference is that it is a whole group of people who at present have a vote in European elections. They will not have that if we leave the European Union. That is true, is it not? That is a major change in their status. At the moment they have some say in who represents them in Europe, but that would change.

David Lidington (Conservative, Aylesbury)

I do not deny that the people of Gibraltar have a unique status compared with residents of other British overseas territories. When Parliament agreed to the European Union Act 2011, we made a careful and tailored arrangement for the people of Gibraltar. We provided for them to participate in a United Kingdom referendum where a proposed treaty change would affect those parts of EU competences that involved Gibraltar, but Gibraltar did not have the right to take part in such a referendum if it was about a treaty change that did not affect Gibraltar because it covered areas outside Gibraltar’s EU engagement. As I said at the outset, this is complicated. I have some sympathy for what members of the Committee have argued, and I propose to reflect further on the Gibraltar issue. I do not give any promises now, but I want to consider it further. Perhaps we will return to the matter here or in the House of Lords.

Barry Sheerman (Labour, Huddersfield)

I shall not delay the Committee any longer. We have had a very good debate on this. I am minded to withdraw my amendment, which was regarded as a probing amendment. I have saved myself some embarrassment: if it were pushed to a vote I might well vote against my own amendment.

Emma Reynolds (Labour, Wolverhampton North East)

I am encouraged by the constructive nature of the debate. Members take different positions on the question of Gibraltar. I welcome the Minister’s undertaking to go away and think about this further. I agree with him: it is a complicated matter. The status of Gibraltar is unlike that of any other overseas territory, as my hon. Friend the Member for Huddersfield pointed out. The question deserves further consideration either on the Floor of the House or in the Lords.

Barry Sheerman (Labour, Huddersfield)

I beg to ask leave to withdraw the amendment.