Verbatim report of proceedings

Thursday, 23 June 2005 - Brussels

4. Programme of the British Presidency

  President. The next item is the Council statement on the Programme of the British Presidency, for which purpose I am going to give the floor to its Prime Minister, Mr Tony Blair, whom I welcome. I would like to remind you that, before today, the Conference of Presidents of Political Groups of this Parliament has had the opportunity to meet with the British Presidency in London; that gave us the opportunity to exchange a series of points of view with the Prime Minister on the way the United Kingdom is going to conduct its rotating Presidency of the Union. But it is now time to inform the plenary of this Parliament.

  Tony Blair, Prime Minister of the United Kingdom. Mr President, colleagues, distinguished guests, it is an honour to be here in the European Parliament today. With your permission, I will come back after each European Council during the UK presidency and report to you. In addition, I will be happy to consult Parliament before each Council so as to have the benefit of the views of the European Parliament before any Council deliberations.

This is a timely address. Whatever else people disagree upon in Europe today, they at least agree on one point: Europe is in the midst of a profound debate about its future. I want to talk to you plainly today about this debate, the reasons for it and how to resolve it. In every crisis there is an opportunity. There is one for Europe now, if we have the courage to take it.

The debate over Europe should not be conducted by trading insults or in terms of personality. It should be an open and frank exchange of ideas. At the outset, I want to describe clearly how I define the debate and the disagreement underlying it. The issue is not between a ‘free market’ Europe and a social Europe, between those who want to retreat to a common market and those who believe in Europe as a political project. This is not just a misrepresentation. It is designed to intimidate those who want to change Europe by representing the desire for change as a betrayal of the European ideal, to try to shut off serious debate about Europe’s future by claiming that the very insistence on debate is to embrace the anti-Europe. It is a mindset I have fought against all my political life. Ideals survive through change. They die through inertia in the face of challenge.

(Applause)

I am a passionate pro-European. I always have been.

(Mixed reactions)

I was wondering whether this was going to be a lively forum, and I am delighted to see that it is.

(Laughter)

It is called democracy and long may it be so.

(Applause)

The first time I voted was in 1975, in the British referendum on membership, and I voted ‘yes’. Shortly before the British election in 1983, when I was the last candidate in the United Kingdom to be selected, and when my party had a policy of withdrawing from Europe, I told the selection conference that I disagreed with the policy. Some thought I had lost the selection, some perhaps wish I had.

(Laughter)

But I then helped to change that policy in the 1980s and I am proud of that change. Since becoming Prime Minister, I have signed the European Social Chapter; helped, along with France, to create the modern European defence policy; have played my part in the Amsterdam, Nice and Rome Treaties.

This is a Union of values, of solidarity between nations and people ...

(Applause)

… of not just a common market in which we trade, but a common political space in which we live as citizens. It always will be. I believe in Europe as a political project. I believe in Europe with a strong and caring social dimension. I would never accept a Europe that was simply an economic market.

(Applause)

To say that this is the issue is to escape the real debate and to hide in the comfort zone of the things we have always said to each other in times of difficulty. There is not some division between the Europe necessary to succeed economically and social Europe. Political Europe and economic Europe do not live in separate rooms. The purpose of social Europe and economic Europe should be to sustain each other. The purpose of political Europe should be to promote the democratic and effective institutions to develop policy in these two spheres and across the board where we want and need to cooperate in our mutual interest. But the purpose of political leadership is to get the policies right for today’s world.

For 50 years European leaders have done that. We talk of crisis; let us first talk of achievement. When the war ended, Europe was in ruins. Today the European Union stands as a monument to political achievement: almost 50 years of peace, 50 years of prosperity, 50 years of progress. Think of it, let us all be grateful for it and be proud of what has happened in Europe in these past 50 years.

(Applause)

The broad sweep of history is on the side of the European Union. Countries round the world are coming together today because in collective cooperation they increase individual strength. Until the second half of the 20th century, individual European nations had, for centuries, dominated the world, colonised large parts of it, and fought wars against each other for world supremacy. Then, out of the carnage of the Second World War, political leaders had the vision to realise that those days were gone. Today’s world does not diminish that vision: it demonstrates its prescience.

The United States is the world’s only superpower. But within a few decades China and India will be the world’s largest economies, each of them with populations three times that of the whole of the European Union. The idea of Europe, united and working together, is essential today for our nations to be strong enough to keep our place in this world.

But now, almost 50 years on, we have to renew. There is no shame in that. All institutions must do it, and we can, as well, but only if we remarry the European ideals we believe in to the modern world in which we live. If we do not, if Europe defaulted to euroscepticism, or if European nations, faced with the immense challenge we have in front of us, decided to huddle together, hoping we can avoid globalisation, shrink away from confronting the changes around us, take refuge in the present policies of Europe as if by constantly repeating them, we would by the very act of repetition make them more relevant, then we risk failure. Failure on a grand, strategic scale. This is not a time to accuse those who want Europe to change of betraying Europe. It is a time to recognise that only by change will Europe recover its strength, its relevance, its idealism and therefore its support amongst the people.

(Applause)

As ever, the people are ahead of the politicians. We always think as a political class that the people, unconcerned with the daily obsession of politics, may not understand it, may not see its subtleties and its complexities. Ultimately, people always see politics more clearly than we do, precisely because they are not obsessed with it on a daily basis.

The issue, therefore, is not about the idea of the European Union. It is about modernisation and policy. It is not a debate about how to abandon Europe, but how to make it do what it was set up to do: improve the lives of people. And right now, they are not convinced.

Consider this. For four years Europe conducted a debate over our new Constitution, two years of it in the Convention. It was a detailed, careful piece of work setting out the new rules to govern a Europe of 25, and then in time 27, 28 and more Member States. The Constitution was endorsed by all governments. It was supported by all leaders. It was then comprehensively rejected in referendums in two founding Member States, in the case of the Netherlands by over 60 per cent. The reality is that, as we speak today at least, to secure a ‘yes’ vote in a referendum in most Member States would be difficult.

There are two possible explanations. One is that people studied the Constitution and disagreed with its precise articles. I doubt that was the basis of the majority ‘no’. This was not an issue of drafting or specific textual disagreement. The other explanation is that the Constitution became merely the vehicle for the people to register a wider and deeper discontent with the state of affairs in Europe. I believe this to be the correct analysis. If so, it is not a crisis of political institutions. It is a crisis of political leadership.

(Applause)

People in Europe are posing hard questions to us. They worry about globalisation, about job security, about pensions, about living standards. They see not just their economy, but also their society changing around them. Traditional communities are broken up. Ethnic patterns change. Family life is under strain as families struggle to balance work and home. We are living through a profound era of upheaval and change. Look at our children and the technology they use and the jobs market they face. The world is unrecognisable from that which we experienced as students twenty or thirty years ago. When such change occurs, moderate people must give leadership. If they do not, the extremes gain traction on the political process. It happens within a nation. It is happening in Europe now.

Just reflect. The Laeken Declaration which launched the Constitution was designed, and I quote, ‘to bring Europe closer to the people’. Did it? The Lisbon Agenda was launched in 2000 with the ambition of making Europe, and I quote, ‘the most competitive place to do business in the world by 2010’. We are half way through that period. Has it succeeded? I have sat through Council Conclusions after Council Conclusions describing how we are reconnecting Europe to the people, but are we?

It is time to give ourselves a reality check and to receive the wake-up call. The people are blowing the trumpets around the city walls. Are we listening? Have we the political will to go out and meet them so that they regard our leadership collectively as part of the solution, and not part of the problem?

(Applause)

That is the context in which the budget debate should be set. People say we need the budget to restore Europe’s credibility. Of course we do, but it should be the right budget. It should not be abstracted from the debate about Europe’s crisis, it should be part of the answer to it.

I want to say a word about last Friday’s summit. There have been suggestions that I was not willing to compromise on the UK rebate; that I only raised common agricultural policy reform at the last minute; that I expected to renegotiate the CAP last Friday night. In fact I am the only British leader that has ever said I would put the rebate on the table. I have never said we should end the CAP now or renegotiate it overnight. Such a position would be absurd. Any change must take account of the legitimate needs of farming communities and must happen over time. I have said simply two things: that we cannot agree a new financial perspective that does not at least set out a process that leads to a more rational budget …

(Applause)

… and that this must allow such a budget to shape the second half of the perspective up to 2013. Otherwise it will be 2014 before any fundamental change is agreed, let alone implemented. In the meantime, of course Britain will pay its full share of enlargement. I might point out that on any basis we would remain the second highest net contributor to the European Union and have in this financial perspective paid billions more than similar-sized countries. That is actually the context for this debate on the budget.

So what would a different policy agenda for Europe look like? First, it would modernise our social model. Again, some have suggested that I want to abandon Europe’s social model. But tell me, what type of social model is it that has 20 million unemployed across Europe; …

(Applause)

… that has productivity rates falling behind those of the United States; that is allowing more science graduates to be produced by India than by Europe; and that on any relative index of a modern economy – skills, research and development, patents, information technology – is going down and not up? India will expand its biotechnology sector fivefold in the next five years. China has trebled its spending on research and development in the last five years. Of the top 20 universities in the world today, only two are now in Europe.

The purpose of our social model should be to enhance our ability to compete, to help our people cope with globalisation, to let them embrace its opportunities and to avoid the dangers. Of course we need a social Europe, but it has to be a social Europe that works. And we have been told how to do it. The Kok report of 2004 shows the way: investment in knowledge; in skills; in active labour market policies; in science parks and innovation; in higher education; in urban regeneration; and in help for small businesses. This is modern social policy, not regulation and job protection that may save some jobs for a time at the expense of many jobs in the future.

(Applause)

And since this is a day for demolishing caricatures, let me demolish one other: the idea that Britain is in the grip of some extreme Anglo-Saxon market philosophy that tramples on the poor and disadvantaged. The present British Government has introduced the New Deal for the unemployed, the largest jobs programme in Europe that has seen long-term youth unemployment virtually abolished in my country. It has increased investment in our public services more than any other European country in the past five years. We needed to do this, it is true, but we did it. We have introduced Britain’s first minimum wage. We have regenerated our cities, we have lifted almost one million children out of poverty, two million pensioners out of acute hardship and are now embarked on the most radical expansion of childcare, maternity and paternity rights in our country’s history. We have done all this on the basis of, and not at the expense of, a strong economy. So that is the first thing, to modernise our social model.

Second, let the budget reflect these realities. The Sapir report shows the way. Published by the European Commission in 2003, it sets out in clear detail what a modern European budget would look like. Let us put it into practice. But a modern budget for Europe is not one that ten years from now is still spending 40 per cent of its money on the common agricultural policy.

(Applause)

Third, implement the Lisbon Agenda. On jobs, labour market participation, school leavers, and life-long learning we set targets at Lisbon, but frankly, at present we are nowhere near meeting those targets by 2010. The Lisbon Agenda told us what to do, let us do it.

Fourth, and here I tread carefully, get a macroeconomic framework for Europe that is disciplined but also flexible. It is not for me to comment on the eurozone, but I just say this: if we agreed real progress on economic reform, if we demonstrated real seriousness on structural change, then people would perceive reform of macro policy as sensible and rational, not a product of fiscal laxity but of common sense. We need such reform urgently in Europe if Europe is to grow.

(Applause)

After the economic and social challenges, then let us confront another set of linked issues: crime, security and immigration. Crime is now crossing borders now more easily than ever before. We estimate that in the UK alone organised crime is costing us GBP 20 billion a year. Migration has doubled in the past 20 years. Much of it is healthy and welcome, but it must be managed. Illegal immigration is an issue for all our nations and a human tragedy for many thousands of people. It is estimated that 70 per cent of illegal immigrants have their passage facilitated by organised criminal groups. Then there is the repugnant practice of human trafficking, whereby organised gangs move people from one region to another with the intention of exploiting them when they arrive. Between 600 000 and 800 000 people are trafficked globally each year and every year over 100 000 women are victims of people trafficking in the European Union.

Again a relevant Justice and Home Affairs agenda would focus on these issues: implementing the European Union action plan on counter-terrorism, which has huge potential to improve law enforcement as well as addressing the radicalisation and recruitment of terrorists; cross-border intelligence and policing on organised crime; developing proposals to hit the people and drug traffickers hard in opening up their bank accounts, harassing their activities, arresting their leading members and bringing them to justice; getting returns agreements for failed asylum-seekers and illegal immigrants from neighbouring countries and others; developing biometric technology to make Europe’s borders secure. All of these are issues we can concentrate upon.

Then there is the whole area of common foreign and security policy. We should be agreeing practical measures to enhance European defence capability, to be prepared to take on more peacekeeping and enforcement missions. We should develop the capability, with NATO, or where NATO does not want to be engaged then outside it, to be able to intervene quickly and effectively in support of conflict resolution. Look at the numbers today in our European armies and the expenditure we make on defence. Do they really answer the strategic needs of today?

Such a defence policy is a necessary part of an effective foreign policy. But even without it, we should be seeing how we can make the influence of the European Union count. When the European Union agreed recently to a doubling of aid, and in particular a doubling of aid to Africa, it was an immediate boost not just for that troubled continent, but for European cooperation. We are world leaders in development today, we should be proud of it.

(Applause)

We should be leading the way on promoting a new multilateral trade agreement which will increase trade for all, especially the poorest nations.

(Applause)

We are leading the debate on climate change and developing pan-European policies to tackle it. Thanks to Javier Solana, Europe has started to make its presence felt in the Middle East peace process. My point is very simple: a strong Europe would be an active player in foreign policy, a good partner of course to the United States, but also capable of demonstrating our own capacity to shape and move the world forward.

(Applause)

Such a Europe – its economy in the process of being modernised and its security enhanced by clear action within our borders and beyond – would be a confident Europe. It would be a Europe confident enough to see enlargement not as a threat, as if membership were a zero sum game in which old members lose as new members gain, but an extraordinary, historic opportunity to build a greater and more powerful Union. Be under no illusion. If we stop enlargement or shut out its natural consequences it would not, in the end, save one job, keep one firm in business, prevent one delocalisation. For a time it might, but not for long. In the meantime, Europe would become more narrow, more introspective and those who garner support would be those not in the traditions of European idealism but in the traditions of outdated nationalism and xenophobia.

I tell you in all frankness, it is a contradiction to be in favour of liberalising Europe’s membership but against opening up its economy. If we set out that clear direction, if we then combine it with a Commission – as this one under José Manuel Barroso’s leadership is fully capable of doing – that is prepared to send back some of the unnecessary regulation, peel back some of the bureaucracy and become a champion of a global, outward-looking competitive Europe, then it will not be hard to capture the imagination and support of the people of Europe.

In our presidency, we will try to take forward the budget deal; to resolve some of the hard dossiers like the Services Directive and Working Time Directive; to carry out the Union’s obligations to those like Turkey and Croatia that wait in hope of a future as part of Europe; and to conduct this debate about the future of Europe in an open, inclusive way, giving our own views strongly but fully respectful of the views of others.

There is only one thing I ask: do not let us kid ourselves that this debate is unnecessary; that if only we can assume business as usual, people will sooner or later relent and acquiesce in Europe as it is, not as they want it to be.

In my time as Prime Minister, I have found that the hard part is not taking the decision, it is spotting when it has to be taken. It is understanding the difference between the challenges that have to be managed and those that have to be confronted and overcome. This is such a moment of decision for Europe.

The people of Europe are speaking to us. They are posing the questions. They are wanting our leadership and it time we gave it to them.

(Loud and sustained applause)

  José Manuel Barroso, President of the Commission. Mr President, President of the Council, honourable Members of the European Parliament, we have entered a turbulent period in European politics and last week’s difficult European Council simply reflects that fact. If nothing else, last week’s meeting of European leaders established a need for the new political consensus that I called for in this very Chamber some time ago; a consensus that is vital if we are to avoid all ideological confrontations and paralysis; a consensus that is vital if we are to deliver on our programme of prosperity, solidarity and security. The way to reconnect Europe to its citizens is by delivering solutions to the concrete challenges they face.

Prime Minister Blair, your presidency is taking place at a decisive moment for Europe. Saying this has become a cliché, but this time it happens to be true. This has important implications for the responsibility you are about to take on. It also raises high expectations. The United Kingdom’s record of pragmatism and results-oriented action will be put to the test in the coming six months. Prime Minister Blair, you are a statesman of enormous experience and conviction and you have confirmed today your commitment to Europe as a political project. I therefore have every confidence that you will lead an inclusive, constructive debate on what Europe can do for its citizens and create the consensus required for the urgent decisions that Europe needs.

I am greatly encouraged that achieving this new consensus and playing an active role during the period of reflection called for by the European Council are priorities for the incoming UK presidency. As I outlined here yesterday, the Commission will also fully live up to the special role it has been given for this debate on the future of Europe. You will recall the meetings I proposed with all Member States – including parliaments, social partners, civil society and young people – to listen and share ideas. A strategy paper will draw on the results of this debate and tackle fundamental questions about the future of Europe. This will feed into next June’s European Council under the Austrian presidency, where we will reassess the situation. I am sure the European Parliament will play a vital role in all this.

As 50 years of history have taught us, the day-to-day business of the European Union continues, even during one of its periodic crises – and so it should. It is crucial that we address the core issues that help to define the Europe our citizens want. But we must not get lost in a period of narrow introspection. It is by actions, not words, that we will win back public trust and confidence.

There is certainly plenty of business to be getting on with, as Prime Minister Blair has just made clear. The goals and priorities he has outlined for the UK presidency over the next six months closely match those of the European Commission and he can count on our support and advice in working towards them.

I wish to take this opportunity to highlight one or two of them in particular. Economic renewal and reform remain the cornerstone of this Commission. The next six months will see the launch of concrete steps to turn the revitalised Lisbon Agenda into reality. The mid-term review of the Lisbon Agenda is behind us. Now is the time for action at both European and national level. Member States will present their national reform programmes this October. These will set out in detail the principal measures they are taking to support our programme for growth and jobs. The Commission, for its part, will present a Community reform programme over the summer. This will set out the different priority actions, both legislative and financial, that need to be adopted or decided upon at European level in support of the Lisbon Agenda. Naturally, our ambitions on Lisbon will be tempered to a greater or lesser extent by the final outcome on the negotiations on the financial perspectives. It is regrettable that the heaviest cuts to the current negotiating box fall on precisely that heading which most supports Lisbon-related policies. That would not have happened if the ‘one per cent club’ of countries did not fight to reduce Europe’s ambitions.

(Applause)

But there is now a real urgency to reach an agreement to avoid paralysis in the Union beyond 2006, a paralysis which will have a negative effect on our policies and on Member States, particularly the new ones. The new members of the European Union expect concrete signals of our solidarity and not just words. That is why we must make further efforts on the existing proposals and the work of the Luxembourg presidency. This does not mean that we should abandon the search for a better-balanced budget, reflecting a good compromise between existing spending on our tried and tested policies, in particular cohesion and our new policy agenda for growth and jobs. That is why I called for a review clause even before the European Council. We need a review clause because we cannot know exactly what the world will be like in 2013. But we cannot wait for 2013. Given the urgency, it is not reasonable to put everything into question now. What is reasonable is to approve the financial perspectives now, working on the basis of the Luxembourg presidency, and accept a review clause during the period of those financial perspectives …

(Applause)

… so that we can adapt the priorities, the structure of expenditure and the structure of resources to the changing circumstances.

Responsibility now lies with the UK presidency to ensure that this is brought to a rapid conclusion, and the Commission is ready to work with it and other Member States to do this.

One core area of the Lisbon Agenda is better regulation. It is not by chance that the first major Commission initiative to implement the revised Lisbon Strategy was the March communication on better regulation for growth and jobs. In that context, we have called for closer collaboration between the European Union and Member States. The UK presidency’s contribution will be essential to the success of this process.

We also need this Parliament and the Council of Ministers to make renewed efforts to ensure the quality and workability of the rules you adopt. A first target must be agreement next month on a common approach to impact assessment across all three institutions. In our bid to cut down on red tape and unnecessary administrative burdens, we are now reviewing proposals that were tabled by preceding Commissions but which have not yet been adopted by the legislators. Our objective is to ensure that pending proposals are in line with our Lisbon priorities. Some 200 pending proposals are under examination. In early autumn we will conclude whether these should remain on the table, be amended or simply thrown out. Finally, in October the Commission will present the next phase of its simplification programme setting out a work programme for 2006-2007.

Another priority I would like to pick out from the many priorities jostling for attention is Africa. I have always said that Africa should be a flagship issue of the Commission. We got off to a good start with our April package of proposals aimed at accelerating European Union progress towards the Millennium Development Goals and giving priority to sub-Saharan Africa. I regret that the European Council’s agreement to our proposals went unnoticed in all the drama of last week. This agreement provides the UK presidency with a solid basis for defending the European Union’s position in the important events which mark 2005 as the year of development, particularly the United Nations Summit in September.

I wish to congratulate the UK on making Africa a priority for its European Union and G8 presidencies, as this will give a welcome extra boost to ongoing activities at European Union level. This autumn, for example, the Commission will present a European Union strategy for Africa which will put flesh on the bones of its focus on Africa. This focus aims to accelerate European Union action in three key areas: governance, interconnection and equity. In order to give a decisive incentive for the reform of Africa’s governance, the Commission proposes to support the implementation of reforms triggered by the Africa peer review mechanism. The Commission also proposes a replenishment of the peace facility so as to provide the African Union with the necessary financial muscle to cope with Africa’s conflicts. We are already supporting the African Union mission in Darfur, for example.

I am pleased that the UK presidency will maintain the momentum also on climate change. This is a top issue for the European Union. Not only must we live up to our commitments under the Kyoto Protocol, we must also start intensifying discussions on the international climate policy regime post-2012 and we must engage our main partners in that direction. A post-2012 framework must build on five elements: the participation of all major emitting nations; the use of market-based instruments; the inclusion of more sectors, such as international aviation and shipping; the development and use of new technologies and support to enable the poorest and worst-affected countries to adapt effectively to climate change. December’s United Nations conference on climate change in Montreal will be an important staging-post in this debate.

Also in December – and this is the last priority I should like to touch upon – is the WTO ministerial meeting in Hong Kong. It is crucial that we spare no effort in making this a success. Only then can we hope to bring the Doha Development Agenda to a speedy and successful conclusion, which is the key to greater prosperity, not only for our citizens but also for those in developing countries.

The UK presidency will see the launch of a period of reflection called for by the European Council. We must look within ourselves for a new consensus and strive to regain the confidence of our citizens, but we must also look outwards towards our global responsibilities and opportunities. We must be a generous Europe, a Europe of solidarity, a Europe of values as well as markets. My Europe – the Europe I want to be part of – is big enough to do both these things. The Europe we want is a Europe where we have both economic and political integration. We believe in Europe as a political project. I hope the UK presidency will make an important contribution to a political Europe and a dynamic Europe.

(Applause)

  Hans-Gert Poettering, on behalf of the PPE-DE Group. – (DE) Mr President, Prime Minister and future President-in-Office of the European Council, Mr President of the Commission, ladies and gentlemen, we heard yesterday a significant speech by the outgoing President-in-Office of the European Council, Mr Jean-Claude Juncker. Today finds us hearing another significant speech by the current Prime Minister of the United Kingdom and incoming President-in-Office of the European Council. I would also like to express my thanks to the President of the Commission for his speeches yesterday and today.

Having been a Member of this House since 1979, I have to say that there has never, in all those years, been such intensive debate about the future shape of the European Union as we have had yesterday and today. That is a victory for democracy, a victory for parliamentarianism, a victory for the people of Europe, as the fact that this debate is open to the public means that the people of Europe can participate in it. It is for that reason that these two days – yesterday and today – must be our starting point when it comes to informing the European public throughout the European Union, and it is here that the debates must be conducted. For that reason, our debates yesterday and today are already of major importance.

(Applause)

It is also necessary for each succeeding President-in-Office of the European Council to justify his conduct in this Chamber and before the European Parliament whenever he has met with defeat, as he did last weekend. Defeat on the financial issue was not in itself all that tragic, but, because it came on top of the defeats in the referenda, that made the crisis all the more acute. We insist that it is not behind the closed doors of the European Council that the great debates on our future must be held, but here in the midst of the representatives of the peoples of the European Union, here in the European Parliament. That is how it must be in the future!

(Applause)

You, the incoming President-in-Office of the European Council, have an immense and difficult task ahead of you. You spoke about respect. There is indeed a need for respect in Europe, not just respect for the great, but for great and small alike. We want no new axes forged between the major states in Europe; we want every country and every citizen to be taken seriously, for this Europe of ours is one in which we share together, and we want it to be a strong Europe, a strong European Union and a Europe that is a Community. That is our goal, and it is one from which we shall never be deflected.

(Applause)

It is for that reason that we are glad that you began your speech by saying that your model does not involve retreating to a free trade area. If your actions reflect your words, if what you do in practice makes clear your desire for a community in Europe, then we are right alongside you. When it comes to reforming European policies, you gain in credibility if you leave no room for doubt about your European vocation, and I ask that you make this clear during your Presidency.

(Applause)

We now have to resolve the crisis of confidence in which we find ourselves, to re-establish trust between the actors in the European Council and regain the confidence of the public. It follows that what is in the Constitution, our common values and the decision-making processes that we need in order to resolve the issues about our future must become legal and political realities. What I ask is that we should not take this pause for reflection as a pause as such, but as a pause in which to think about how we can establish a legal – and hence political – foundation on which this European Union of ours can become effective in the future.

You now have an immense task ahead of you, one about which Mr Juncker spoke yesterday: the Financial Perspective, about which there was a fair old bit of haggling at the European Council. Mr Böge has put forward a proposal from this House relating to the Financial Perspective, and, if you want the possibility of compromise, I urge you to be guided by it. Mr Blair, you are a Labour Prime Minister; it was our friend John Major who, as the United Kingdom’s Prime Minister in 1992, managed to put together a Financial Perspective for the whole of the European Union, which was at that time the European Community. I wish you, a Labour Prime Minister, the same success that the Conservative, John Major, had in 1992.

(Applause)

Now for my final point, if the President will allow me a few seconds more. You said that we have to carry the people with us. We must indeed carry the public with us, but the public want to have a sense of being representative of their own countries as well as of being Europeans together. Let us then think about the borders of the European Union; not every country that wants to join it should be welcomed in, for then Europe would risk losing its identity. Let us go to work on Europe together. Prime Minister, it is now 10 a.m., while in the United Kingdom, where the clocks keep rather different time, it is 9 a.m. You got up early this morning. Let us always get up early to go to work on Europe! We need, though, to be calm in action, so we need to have had a good night’s sleep. Our vision is still a vision of Europe; make it a reality, and we will be by your side.

(Applause)

  Martin Schulz, on behalf of the PSE Group. – (DE) Mr President, ladies and gentlemen, thank you, Prime Minister, for speaking with such frankness. Yours was the sort of frank speech that does one good, and I know that you are the sort of man who can take that sort of language, so I will start with some: John Major may well have been a great Briton, but your beating him gave us particular pleasure.

(Applause)

Today, Mr Blair, sees not only the beginning of your Presidency of the Council, but also – and this should not be forgotten – the beginning of another great European event, the Tour de France, and when I apply what I think about the Tour de France to the United Kingdom, I have to say that the UK has, in the last few years, always rather pedalled along at the rear of the pack. If you think back to Schengen, or to the euro, Great Britain was always, one might say, just before the follow-up vehicle. Now, Mr Blair, you must place yourself at the head of the pack, and on a mountain stretch too! We are just coming up to Alpe d’Huez, and I think you should bear in mind that the winner of the Tour gets to wear the tricot jaune only if he makes it through the whole distance and wins every stage. Today sees the beginning of the prologue, a short time-trial that has augured well for the future, and, as we discuss your performance in it, let us consider carefully what you actually said.

You are right to say, Mr Blair, that the time is ripe for reforms and changes. That is indeed the case. I quite clearly heard you say that this is not the time for accusing those who want to change Europe of betraying it. You are right in that, but this is not the time either to put those who want to defend our European social model into a museum – you are right there too. Improving our people’s living conditions is dependent upon change, and, while you are right to say that Europe needs more flexibility and more competitiveness both at home and abroad, it needs them because something nobody can dispense with depends upon them. By that I mean the growth that they create, which itself is needed in order to create jobs, but not only for their own sake; they must be worthwhile jobs, secure and properly paid so as to enable people to live decently from them – that is what we, in Europe, are aiming for!

(Applause)

And, if the change you seek is none other than that very change in the European Union, then Tony Blair the Socialist will have Europe’s Socialists side by side with him – of that you may be certain.

We must be precise in the debate on reforms in which we are engaged. You, Mr President-in-Office and Prime Minister, are right, and Mr Poettering – whom you really did manage to get worked up today – found the right way of saying it: there are debates that have to be conducted, and they have to be conducted here. We must, however, conduct them in such a manner that the public can understand what they are about, and that is where we must not confuse one thing with another. Yes, Mr Blair, of course we have to reform the common agricultural policy, and yes, of course, we need to spend more on research and development. What we must not do, though, is act as if agriculture were the only thing going on in Europe, and there were no research and development being done.

Our Budget expert, Mr Walter, gave our group some more figures yesterday, and I want to run through them again briefly. Taking all agricultural expenditure together, we, in the European Union as a whole, spend 0.48% of Europe’s total gross domestic product on agriculture. Add together what the EU and all its Member States spend on research and development, and it works out that, even now, that figure reaches 0.86%.

That figure must be increased – you are right in saying that – and there is room for reform in agriculture, but these are long drawn-out processes and our credibility depends on our not acting as if Europe amounted to no more than agriculture, without research or development.

(Applause)

If, Mr Blair, you want to make the European Union deeper, then we are right alongside you. I am grateful to you for having, here in this Chamber today, committed yourself to the Constitution. I was there as a witness when you signed it in Rome, and I think it is marvellous how the United Kingdom, under your presidency of the Council, is committing itself to the Constitution; there are quite enough people who are committing themselves to it in public and doing something different behind the scenes. We have had our fill of politicians who, by their words, throw spanners in the works of European integration and then complain that the European engine is faltering; I find it highly praiseworthy that you should distinguish yourself from them this morning, and for that I am grateful to you, for what is crucial is that we speak frankly and are open and honest in debating the future of Europe.

Let me draw to a close by saying that, if you are willing to compromise on the Budget, the services directive and the working time directive, then we will back you in that. Yet the credibility of your own demand for a compromise, Mr President-in-Office and Prime Minister, is always in proportion to your own willingness to enter into one. At some point, then, you must say what you are willing to contribute. To let others make their move before considering making your own may well be the right thing for a British Prime Minister to do, but it is not enough for the President of the Council of the European Union.

(Applause)

Note well from whom you get applause; it is the Right wing in this House that has just applauded you. They have chosen not to hear you say that we want to welcome Turkey into the European Union. It is those who are sitting on this side of the House who will be the first to embrace you for saying that. Thank you for your attention.

(Applause)

  Graham Watson, on behalf of the ALDE Group. – Thank you, Mr President. Prime Minister, you take the helm of a craft lacking direction, wallowing in heavy seas. You have every opportunity to show leadership. For too long your country has been vulnerable to the caricature sketched 50 years ago by the musical comedy duo Flanders and Swann in their ditty ‘The English are best’, which lambasts the character of other Europeans and insists ‘The English are moral, the English are good, and clever and honest .... but misunderstood’!

(Laughter)

Britain has moved on since then – heavens, even England has moved on! Modern, meritocratic Britain has a level of intercultural sensitivity not common to its forebears and your speech today reflects that. But one speech will not suffice to set aside years of suspicion. You need to show that Britain is of Europe, not just with it.

(Applause)

That you will build on the Union’s institutions, not undermine them; that your drive for reform is rooted in creating consensus, not delighting in division; that your protestant work ethic caters for a catholic sense of community.

The phenomenon we call globalisation is re-shaping our world view, as you say. It opens to humankind new opportunities, yet also puts new strains on our societies. The three biggest challenges we face – Third World misery and the migration it generates, climate change, internationally organised crime – all require supranational responses. You are right to direct EU priorities to meeting new global demands, complementing the work of the G8. But we look forward to seeing how you will do all that on 1% of GNI.

(Applause)

You are correct, too, that there is a cognitive dissonance between reality and political debate, that we need to get the politics right and give Europe a compelling narrative. So let me give you three suggestions.

First, Council transparency. Europe can no longer be built on secrecy and spin. If people do not understand what is happening, you cannot reproach them for rejecting it.

(Loud applause)

Change the rules of the Council of Ministers. The public has a right to know what is being decided in their name and by whom, even if they disagree. That is the nature of democracy.

Second, parliamentary scrutiny. National parliaments do not need a European Constitution to scrutinise the European work of their ministers more closely, but they need to be engaged in a process of monitoring and holding ministers to account. The European Parliament must also be listened to if we reject draft laws for infringing citizens’ rights or exceeding EU competences.

Third, public debate. This debate cannot wait for the need to underwrite a treaty that governments have already signed. Did you go out and meet your trumpet-blowing people in your recent general election? As President Borrell pointed out last week, the rejection of the Constitution was less about the text than the context. Last week Le Monde called you ‘le nouvel homme fort de l’Europe’. Show it. The EU will be leaderless for as long as its national leaders play to their public galleries. You will not secure support for supranational solutions if you claim the credit for common successes and blame Brussels for every ill. Stop referring to ‘Europe’ as if it were a thing apart.

Liberals and Democrats will back your presidency and your drive for better regulation. We will help you forge a Financial Services Action Plan to make money move more easily. We will support a single market in services if you protect proper public provision and if you heed our concerns for personal freedom we will tackle terrorism together with the Council.

We also welcome a debate on the structure of a budget inconsistent with the competitiveness and innovation foreseen in Lisbon. Rapid and radical reform of rural spending cannot credibly be contemplated, however, without co-financing the CAP to redress French and British budget imbalances.

Prime Minister, I welcome your speech today. It offers the promise to our continental colleagues of a less perfidious albion. Heed the words of St Francis of Assisi, quoted on a similar occasion by one of your predecessors: bring pardon where there is injury and harmony where there is discord. That is the road to new respect for Britain and the European Union.

(Loud applause)

  Daniel Marc Cohn-Bendit, on behalf of the Verts/ALE Group. – (FR) Mr Blair, I think that, today, you have issued a challenge. You have said, ‘I want to change Europe’. Welcome to the club, Tony. You are welcome to do this job. In that case, though, let us make a few things clear.

You are not John, Duke of Bedford, Mr Balkenende is not Bishop Cauchon and Mr Chirac is not Joan of Arc. That is old Europe. The 100 Years’ War is over, and we need to tell that to Mr Chirac, to Mr Schröder, to Mr Blair and to the rest. Europe is exactly the opposite; that is why you were right to say ‘Europe needs leadership’, but who wants to be the leader? Today, a modern leader must tell the truth.

Mr Blair, you applauded when Mr Barroso referred to the 1%, the skinflint letter that you, Mr Blair, comrade Blair, signed. You withdraw your signature. Welcome to the club, Mr Blair, welcome to the club. And, if I understand it correctly, in 2002, it was your government that rejected the setting of a ceiling for the big agribusinesses, it was your government that gave EUR 300 000 so that the Duke of Bedford, the Queen and Prince Charles could have their subsidies from the European Union. Welcome to the club, Mr Blair, welcome to the club. And because you rejected that, Tate and Lyle, the biggest sugar company, received EUR 180 million last year. Welcome to the club, Mr Blair. You will put an end to the situation with Tate and Lyle, with their European aid and subsidies, because they do not deserve it; we agree with you, Mr Blair. You see, telling the truth is sometimes difficult.

You said something else that was very interesting; you said ‘politicians fight populism’. You are right. We, I lost the referendum on Europe, and we must confront that defeat. You must confront your own defeat: the people of Europe said no to the invasion of Iraq. Confront the people of Europe on this subject, too. Welcome to the club, Mr Blair.

It is always easy to lecture everybody, and I am a specialist in lecturing: I know how easy it is. But if there is one thing I know, it is that, if you want to modernise Europe, the modernisation must be environmentally and socially sustainable. That is what we are calling for.

If you say that the French model is not working, that the right-wing French Government is not working, you are right. If you say that the German Government is clearly not working, you are certainly right. In that case, however, the problem is that Europe cannot operate on the model of the United Kingdom, Europe cannot operate on the model of France, Europe cannot operate on the model of Luxembourg or of the Netherlands. The intelligence of Europe lies in finding a blend between those models and, to do that, Mr Blair, you must not remain Prime Minister of the United Kingdom, but become President of Europe, with a vision of Europe.

We have economic and social problems, and we have environmental problems. Therefore, take responsibility and say that Europe, the whole of Europe, must meet the Kyoto commitments. You must take responsibility, and the UK must take the responsibility to give more than 0.35% to development aid, because poverty in the world needs it. Mr Juncker was right to propose to eradicate world poverty within the first half of this century. Let us make that commitment together. Welcome to the club, Tony, we are with you.

To conclude, it is exactly ten years since Srebrenica; it is ten years since Europe, the shame of Europe and of the world, was put before us. I call on you to take an initiative. The Dayton Agreements cannot and will not make Bosnia and the Balkans work. Take this grand initiative, go to see your friend George Bush, go to see your friend Mr Chirac, go to see all your friends and say ‘We need to put an end to Dayton, Europe has (...)’

(The President cut off the speaker)

  Francis Wurtz, on behalf of the GUE/NGL Group. – (FR) Mr President, Mr Barroso, you have, Mr Blair, put your finger on the tragic inability of the EU, as it is now, to meet the expectations of our fellow citizens. You have spoken of change, modernisation and solidarity. Very good. Now let us look at things a little more closely. On three occasions in the space of a month, each time in a very different context, we have had the opportunity to acquaint ourselves with the top priorities of the UK Presidency.

The first time was on 26 May in the form of a succinct and very specific statement by Gordon Brown, Chancellor of the Exchequer, to the House of Commons. I will remind you of four points.

Firstly, I quote, ‘All regulatory proposals must be tested for their impact on competitiveness’. Secondly, an independent business-led advisory group should be set up ‘to give business a central role in the EU rule-making and simplification process’. Thirdly, we will hold a conference in London in July on reducing State aid. Fourthly, we will call for the creation of a barrier-free transatlantic financial market. Dare I say, Prime Minister, that the social courage of these tasks does not exactly leap out at us.

Nevertheless, a few days later, in an interview with the Financial Times, you said that you wanted to be receptive to what had just been expressed in the French and Dutch referenda. To that end, you called, back then, for reflection on the European social model. It seems to me that we do indeed need such reflection, but we need it so that we can draw lessons from the systematic unpicking to which this infamous model has been subjected practically everywhere over the last few years, in the name of ‘the market above all’. As Commissioner McCreevy so aptly emphasised in the context of the European Policy Forum on 24 January, and I quote, ‘We should remember that the internal market programme is by far the greatest deregulatory exercise in recent history’. The issue is now to reflect on the European social model, yes, but in what direction?

You seem to be convinced that the crème de la crème in that regard is your own model, as it limits apparent unemployment to some 5% of the active population. Does this symbolic figure sum up this model? That does not seem to be the case for all the people of the UK. For example, according to Mr John Monks, General Secretary of the ETUC, who is a friend of yours, the Anglo-Saxon model is no more popular with the UK electorate than elsewhere in Europe. I believe that many labour representatives in the United Kingdom want far-reaching changes. Why are you ignoring them? We gain more from listening to doubts than from repeating certainties.

The third time that we were given the opportunity to see your ambitions for the six months of your Presidency and beyond was of course during your performance at the last European Council. As a well-known song says, you want to make the past a blank slate, or at least send the CAP and the budget back to the drawing board. Very good, but, in that case too, the only valid question is: in order to change it in what direction?

With regard to the CAP, I agree that we should modulate aid to take account of the environment and town and country planning and to avoid productivism. I also agree that we should call into question export subsidies that compete directly with production in developing countries, particularly in Africa. I also agree whole-heartedly with putting a ceiling on aid so that it does not end up making the rich, or those pseudo-farmers sitting in the House of Lords, even richer, but I do not agree with throwing the baby out with the bathwater: a genuine agricultural sector that will protect us from scourges such as mad cow disease and that will guarantee our sovereignty over our own food in the face of ‘agribusiness’, particularly in the US. It is an issue for civilisation.

As for the infamous rebate, you will have to give it up sooner or later, because it flies in the face of common sense. Europeans should be told that, in 2005, this cheque exceeds the whole European research budget. It represents more than all the pre-accession aid granted to Romania and Bulgaria over three years. This year, it adds up to half of all the agricultural and structural aid allocated to all ten new Member States. It enables you to default on your responsibilities on enlargement, and it no doubt helps you to finance the war in Iraq. Finally, your share in financing the EU’s budget is 4.5 points lower than your share in Community revenue. Where is the solidarity in that? You want to talk about the Europe of the future, Mr Blair? Very well, you are on, let us talk about it!

(Applause)

  Nigel Farage, on behalf of the IND/DEM Group. – Mr President, Prime Minister, what a change since 1997 in terms of the rhetoric! Suddenly we have a Labour British Prime Minister talking about low growth in Europe, talking about unemployment in Europe, talking about the failure of European economic policies and common policies. In fact it all sounds a bit like the same sort of thing UKIP has been saying for the last ten years and I am delighted to hear it.

There you were at the Summit last week, the tough British Prime Minister, and I am sure that millions of people at home were watching the early evening news saying there he is! That is our boy, he is the man that is going to stand up for British interests. In fact it seems to me that you are a europhile that has been mugged by reality. Now you are going to lead a battle for the future of Europe. Several times in the last week you have talked about the 21st century, you have talked about the need to modernise. It seems that the devastatingly brilliant third way that you introduced into British politics is what you are going to bring in during this presidency here. The question is, will it work in the European Union?

I am the joint leader of the only Group in this Parliament that has actively been campaigning for ‘no’ votes in the Constitutional referendums. So we feel that we are perhaps rather more in touch with public opinion than all the rest of the Groups in this Parliament.

(Cheers from the IND/DEM Group)

But I have to say that you are just about the only European Leader who really understands why the people of France and Holland voted ‘no’. I agree with what you said earlier, i.e. that they were saying ‘no’ to the direction that the European Union is going in. I am asking you in your presidency to make sure that those people in France and Holland are not treated with contempt. I am asking you to make sure that the parts of the Constitution such as the separate military command structure, the European Space programme and the establishment of the European Union foreign embassies across the world are halted because they are only given legitimacy by a Constitution that is now best part dead.

You have talked much in recent times about Africa and I know you are very proud of the fact that the aid that will be going to Africa is going up in value. However, the one thing I have spoken on more times in this House since 1999 than any other subject are the appalling European Union fisheries deals with black Africa. There are now over twenty of these deals in place. They are destroying any hope, any prospect for the local artisanal fishermen. We are actually killing hundreds and hundreds of local fishermen every year and what we are doing to the seas off Africa is the environmental equivalent to setting fire to the Serengeti. Everybody here has been deaf to what I have been saying on this, but I believe there is now a body of support across this Parliament to end these deals. If you really want to help Africa, please, stop those deals.

(Applause)

But of course the big challenge, and what you will be judged by, is whether you can turn this ship around; whether you can make Europe more competitive; whether you can make the Lisbon Agenda appear to be rather more than just a child’s wish list to Father Christmas.

Of course my view – our view in UKIP and most of us here on this side of the House – is that we would much rather see a common market. We would much rather see a free trade deal across Europe, rather than the Treaty of Rome and all that has come since. I know that you are not going to do that over the course of the next six months, but I think you have got a real problem. You said earlier that you wanted Europe to do what it was set up to do. Jean Monnet was the inspiration behind this and he wanted a system whereby, under the acquis communautaire, the Community picked up power along the way. I would argue that if you now speak to small and medium-sized businesses – not just in Britain, but right across the European Union – the trouble is that the legislation, the acquis communautaire, the body of law, has gone too far already. The challenge for your presidency – and perhaps you could explain to me in your response – is how you are going to turn the ship around. If you can reform the European Union, Mr Blair, then I may even change my mind. I may even think it is worth us staying as a Member State.

  Brian Crowley, on behalf of the UEN Group. – Mr President, I too would like to join with my colleagues in welcoming Prime Minister Blair to the House and thanking him for his contribution and his speech this morning.

Much as I appreciate that speech, I am somewhat disconcerted by Gordon Brown’s annual address at the Mansion House last night. Despite the good words and the good intentions, I have three separate conclusions about what we saw last weekend, what we read in the papers from Britain, what we have seen in the news media over the last few days and what Mr Brown said in his speech last night.

Firstly, the plan is: dump the common agricultural policy. Ensure that any budget changes that are made will be predicated upon getting rid of the common agricultural policy. This is despite the fact that in 2002 there was a unanimous agreement amongst all Member States that the CAP budget will be fixed for a period up to 2013 on foot of reforms and on foot of sacrifices made by people living in rural areas and people involved in agriculture, including the reduction in the annual budget of CAP because there was no cost of living increase or no inflation index allowed for increasing of funding. So therefore what people really need to see is certainty.

Second, much emphasis is being placed upon the lack of ability on the part of Europe to deliver on things like the Lisbon Agenda and creating more jobs. Let us get real about this. Europe is as incapable of creating jobs as the British Government is of creating jobs. It is up to us as legislators and as rule makers to ensure that the legislation and the regulations that we put down do not impede private industry and private business to give them the right atmosphere, the right opportunity in which to thrive and to grow. And it is ridiculous to speak about how we must do more at European level when at the same time you will not increase the budget that is available to the European Union to undertake this work, despite the fact that the numbers of people involved in the European Union and the number of countries involved in the European Union has increased.

I think that if we want to speak about real debate and real engagement then that debate and that engagement must be based upon facts, certainties, not the continuous misconception, myth and innuendo that have been cast about over the last 20 years. Last night I heard Jeremy Paxman on Newsnight saying that the reform of the sugar regime in Europe was the most disreputable and inefficient form of subsidy given to farmers in Europe and is harming farmers in developing countries. On the same report about these reforms we heard the President of Guyana, the chairman of the Jamaican sugar industry and the chairman of the Mozambique sugar industry saying what a disaster these reforms would be for those countries. The President of Guyana actually said that they would receive EUR 8 million in debt relief because of the fantastic initiative undertaken by yourself and your government as leaders of the G8 with regard to alleviating debt in Africa and it would cost them GBP 44 million to try and comply with the reforms that would be put forward.

Finally, some will say that we are standing on the edge looking into the abyss. As I said to you in London last week, I believe we are standing at the dawn of a new future. You can give the leadership but that leadership requires compromise and consensus. It requires you to bring the other actors together to ensure we have a success.

(Applause)

  Roger Helmer (NI). – Mr President, speaking as a British Conservative I would like to congratulate Prime Minister Blair on his recent robust defence of the British rebate in the House of Commons and in Westminster. I urge him to stand firm on the rebate and to honour the clear commitments he has made. I also commend his conversion to a long-standing Conservative policy, that of wide-ranging reform of the EU; reform which is essential now that the EU has ceased to command the respect, or to engage the enthusiasm, of the public.

However, as John Redwood said this morning on the Today programme, if Mr Blair is serious about reform and deregulation he will have had a team in place for months working out detailed plans. Who are these people? What are these plans?

I am concerned that he has agreed to a period of reflection on the Constitution. There is nothing to reflect about. The decision of French and Dutch voters is extremely clear: France and Holland did not vote for a slightly different Constitution, they voted against the Constitution in its entirety. Under its own terms the Constitution cannot take effect until all Member States ratify it, which will not now happen.

UK voters, given the chance, would have rejected the Constitution by a still wider margin than France or Holland. Overwhelmingly they want trade and cooperation in Europe, they reject your political union.

Mr Blair, will you agree with me that meaningful reform of the EU will require radical renegotiations of the Treaties, including the Treaty of Rome? Will you make this a key objective of the British presidency? Finally, Mr Blair, may I thank you for staying to listen to the debate here today, which you so rarely do in Westminster.

  Timothy Kirkhope (PPE-DE). – Mr President, on behalf of the Conservative delegation and my European Democrat colleagues, can I welcome the Prime Minister and say that we hope the British presidency will indeed be a truly reforming one.

It is important for our country and our national interest that Britain gives leadership to Europe at a time when fundamental questions on its future are being asked. However, it has to be the right kind of leadership and it has to be the right kind of future. The events of recent weeks have indeed been a wake-up call for politicians across the Union. The fact that the people of France and the Netherlands, two founding States, voted emphatically against the Constitution has to be of profound significance.

I regret that the European Council did not respond decisively to these votes by declaring the Constitution dead. Mr Blair has said that there needs to be a real debate on the kind of European Union that we want in the future and I agree with him. I look to him to lead that debate in the coming months.

We hope that he will show his leadership by explaining exactly what he meant by his comments the other day that there is more than one view on Europe's future. Earlier this week Mr Blair said the crisis is about the failure of leaders to reach agreement with the people who see the world changing, and who want answers to the challenges they face. Well, British Conservatives have been saying this for years about the European Union as we have led the way here in the fields of liberalising our economies, deregulation, the Lisbon Agenda and open accountability and control of our budgets.

If he is now rather belatedly accepting our positions, I certainly welcome his conversion. However, this is not just a crisis of leadership, as he says, but it is also a crisis of legitimacy within the EU institutions. Fine words from our government are all very well, but what we now need is action. The social model has not succeeded in Europe and millions of unemployed with low growth and inflexible labour markets personify economic decline. We now have to compete with India, China and the United States, and the longer we brush the reality aside, the Lisbon Agenda remains nothing but an aspiration.

I turn now to the future financing of the Union. The Prime Minister was right to defend the British rebate. There is a reason for this rebate existing, and it is as strong as it was in 1984. The apparent slippage in the Government's position, which has been confirmed this morning by the Prime Minister, is of concern to us and we obviously watch carefully to ensure that British taxpayers do not become pawns in discussions over the future of our budget.

In conclusion I want to urge the Prime Minister not to be deflected from his stated goals of reform in the Union. We want his rhetoric of recent days to be matched by real leadership and real action.

We hope that he can deliver. It is the interests of all of us that he delivers what he says he will. When we judge him in December we hope that he will not have failed us.

  Gary Titley (PSE). – Mr President, I would like to welcome the future President-in-Office by quoting Charles Dickens: 'it was the best of times, it was the worst of times, we had everything before us, we had nothing before us'. So it is with the European Union. At the time of our greatest success, the enlargement to 25, we find ourselves cast down by doubts and recriminations. Globalisation has bred insecurity among our citizens, causing some to doubt the European project and to embrace protectionism and isolationism. Yet it is only by coherent European action that we can confront the threats and seize the opportunities of globalisation.

Unfortunately, much of what the EU has achieved is now taken for granted by the voters and is regarded, frankly, as 'old hat'. We have to define a modern vision of the European Union and its purpose and relevance; a vision based on concrete outcomes, not processes; a vision based on certain key principles.

Firstly, the importance of international partnerships and particularly the most successful partnership of them all, the European Union. We have to recognise that the strength of the EU lies in its supranational institutions which complement and supplement national sovereignty and do not replace it. Secondly, our ability to deliver jobs for our citizens and economic security for their families is central to our continuing success. A successful economy is not an Anglo-Saxon conspiracy, but the key to our survival.

The European Union has already done a lot. In recent days we have heard that EU membership costs this country EUR 20 per head, or that country EUR 50 per head. These figures are insignificant compared with the EUR 6 000 per head by which the single market has benefited its citizens through extra growth. But we must do more to harness the knowledge economy by investing in the projects of the future and not the past.

Economic efficiency depends on social justice. Prosperity comes from a secure workforce and a society that invests in all its citizens, excluding no-one. We need active labour market policies to help people find and keep work. A third of our working-age population is economically inactive. That figure is a disgrace and stands to the condemnation of the EU and its Member States.

Finally, we need an open society where people are free to travel to find work. Such an open society has to be fair and just and not a free ride for the criminals and the terrorists. That is why I particularly welcome the presidency programme on justice and home affairs. Real progress here will show our citizens the benefits of European action. The presidency has to bring Member States together to build a competitive Europe and a Europe capable of giving leadership in the world on issues such as security, climate change and world poverty, the very issues that our citizens are concerned about. I wish you the best of luck.

  Karin Riis-Jørgensen (ALDE). – (DA) Mr President, Mr Blair, thank you for a wonderfully committed speech. You are a terrific speaker, and you are very convincing. You would have been more credible, however, if you had presented the same European vision to your electorate at the last parliamentary elections you held. I see your Presidency as an historic challenge. In six months’ time, you can either transfer the Presidency to Austria, having unified Europe, or you can slam the door and leave Europe still more divided than it is at present. It is up to you. First and foremost, it is a question of putting the European agenda above national agendas. That is difficult and demands leadership, but it also requires will, and I hope that you have that will. Above all, you should now, moreover, as one of the leaders of the enlargement process, show solidarity towards our new Member States.

I am pleased that you attach a lot of importance to the Services Directive and that you will do a lot of work on removing the administrative difficulties. Precisely by creating a free market for services, we can give our people jobs and give consumers freedom of choice at fair and reasonable prices. I look forward to seeing, in six months’ time, that you have stood the test as Europe’s best leader. I shall then happily give you your examination certificate.

IN THE CHAIR: MR McMILLAN-SCOTT
Vice-President

  Caroline Lucas (Verts/ALE). – Mr President, in the past Mr Blair has said that climate change is the biggest threat that we face. He said that it would be a priority for the British presidency. Yet, Mr Blair, we have had just half a sentence on climate change from you in your speech here today. Moreover, yours is a government under which greenhouse gas emissions have actually risen. Yours is a government which has attempted to increase the volume of emissions allowable to British industry under the EU emissions trading scheme. That is hardly a very good start for someone who is pledging to show international leadership on the issue of climate change.

I would like to challenge you to make three key assurances about your presidency. First, to promote mandatory targets for energy efficiency across the European Union. Second, to adopt targets for renewables which are consistent with a reduction of between 30 to 40 per cent of greenhouse gas emissions by 2020. Third, to rule out nuclear power as any kind of so-called solution to reducing CO2 emissions.

When you lecture the rest of Europe about the merits of modernisation, competition and flexibility, yet leave out any reference at all to sustainability: it completely undermines any claims you make to be committed to sustainable development. Yes, Europe must change as you say, but unless that change puts sustainability at its heart then your presidency will lose a vital opportunity to help the European Union regain public support and it will squander a key moment to address climate change seriously.

  Roberto Musacchio (GUE/NGL). – (IT) Mr President, ladies and gentlemen, you, Mr Blair, are not the solution to Europe’s problems; in fact you are one of the problems. You are not a new problem, but an old problem.

The problems of Europe are its inability to work towards achieving peace, and, let us not forget, you went to war in Iraq alongside George Bush. They are democratic, political, economic and social crises precisely due to the liberalist, monetarist and technocratic policies that you advocate, passing off old ideas as new.

You talk about political Europe, but in fact you entrust it all to the market, because for you, politics, the economy and the market are one and the same thing. In fact, whilst you understand that this liberalist Constitutional Treaty is dead, the cure that you propose to us is completely inappropriate, in terms of liberal reforms, starting with the one on services and the labour market: this cure of yours does not even enjoy good health in your own country, as we witnessed with the elections.

No! The solution to Europe’s problems is something else entirely, and it is precisely to be found in this left-wing, mass Europeanism that has consciously emerged among citizens who have read and understood and expressed themselves by means of the vote in France and the Netherlands. They were not protesting against either Turkey or enlargement, but explicitly against liberalism. They call for a tangible and formal Constitution for a new peaceful, democratic and social Europe, and can find broad agreement on that with the many citizens who expressed a critical ‘yes’ vote.

That is our Europe and this Parliament has a major responsibility that it cannot and must not avoid. It is not a matter of chasing after new supposed leaders, but of being a thoroughly new Parliament. This crisis is not a crisis of calculations and of egoisms, or of the computer against the country folk, but we cannot forget how ‘mad cow’ disease started. It is that too, but it is above all the unquestionable crisis of a liberalist idea: not to formulate an alternative idea of Europe would truly be unforgivable.

  Mirosław Mariusz Piotrowski (IND/DEM).  – (PL) Mr President, Prime Minister Blair, ladies and gentlemen, there would appear to be no justification for the across-the-board criticism levelled at the United Kingdom following the failed European Council summit. As a matter of fact, there are strong grounds for believing that the British Presidency has no intention of being influenced by the selfish national interests attributed to it. Its stated priorities reveal that the EU’s goal will instead be solidarity between Member States, which represents a return to the ideas of Europe’s founding fathers. The fact that the Presidency wishes to reform the EU’s ossified structures is cause for optimism. This pragmatic and future-looking approach, which is of enormous value, could give a fresh impetus to the development of Europe’s nations and to cooperation between them, by supplanting the illusory idea of a superstate with a constitution, the latter being fortunately dead and buried. As far as the British rebate is concerned, Prime Minister Blair recently said in an interview that the United Kingdom would be prepared to pay more, but only if the money went to poor countries rather than rich ones. This way of thinking represents a major opportunity for Europe’s poorest regions, five of which are in Poland. They include the Lubelski and Podkarpacki regions, which have huge infrastructure problems, but also huge potential in the form of major universities. Sensible policies of this kind are just what these and many other European regions need. One can but hope that all EU Member States will support the measures taken by a strong British Presidency, and I am sure that France and Germany will also back European solidarity. After all, solidarity was the founding principle of the European Community, even though the current leaders of the two countries I mentioned appear to have forgotten this fact.

  Mogens N.J. Camre (UEN). – (DA) Mr President, Prime Minister, the vast majority of Danes, in common with the British, do not want the EU Constitution because we do not wish to surrender our sovereignty to politicians who go about things as badly as the EU does at present. Mr Blair, you are a very popular politician in Denmark, but we shall respect you even more if you arrange for the Constitution to be buried for, as you well know, it does not solve a single one of the problems that engage the attention of Europeans and that you described very precisely.

I would thank you for your plans to amend the EU budget, which has now completely seized up. It is not the richest who pay most and the poorest who receive most. EU aid policy has lost all meaning when it comes both to agriculture and structures. What happens is that those countries that are industrious and willing to tax their citizens hard make payments to countries that do not implement reforms and do not wish to tax their people. We go on and on about research and development, but these are not what we spend money on. We look forward to the reforms you are to present, and I wish you good luck.

  Ashley Mote (NI). – Mr President, the voters of France and Holland have denied power to those they no longer trust, as indeed we would have done in the UK had we had the chance. We are now left with the worst possible solution: the Constitution is dead, but we have the structures and methods to govern a unitary state still in place.

Projects have been started which depended on the Constitution for their legitimacy. A European president and foreign minister, a European public prosecutor, diplomatic service, space policy, a European Defence Agency and Rapid Reaction Force, a Fundamental Rights Agency to enforce a charter that now has no standing, a police force and a European asylum and immigration policy. These bits of the Constitution cannot be forced into being against the will of the people.

We have had far too much unaccountable and interfering government from this place over the years. The British presidency should take three immediate and crucial steps: to enforce the rule of law in this place; to abandon projects which pre-empted the Constitution and now have no legal basis; and to guarantee that no attempt will be made to implement any part of it.

  Françoise Grossetête (PPE-DE). – (FR) Prime Minister, you say that you want to level out the anomalies in Europe. Well, your presence in Brussels today is an anomaly. You should know that the programme of activities for a Presidency of the European Council is presented in Strasbourg, the official site of the European Parliament. Yes, Europe is in crisis, the Summit was a failure and your coming Presidency is faced with a crucial choice: either Europe will be a huge economic grouping with neither head nor tail in which witches dance around the grave of the draft Constitution, a sort of ‘Blair witch project’; or you release the handbrake to help us turn this historic corner that is the advent of a truly political Europe.

Prime Minister, you are talented – you speak brilliantly – but who are we to believe, you or Mr Juncker? You preferred to create a crisis so that you could ride the crest of that crisis and serve your own interests. If you want to lead Europe, you must first of all stop having one foot in Europe and one foot outside.

Therefore, yes to social modernisation, but we do not want your uncertainty. Yes to the development of biotechnology, yes to a rational European budget, yes to true European defence, but do not forget that the CAP is a foundation of the European Union which cannot be consigned to history, but whose survival depends on its development. You say that you want to make progress in the fight against crime and illegal immigration, but how can we believe you when, for the last ten years, the United Kingdom has systematically opposed police and judicial cooperation?

Finally, how can we explain the fact that, in their own countries, the Heads of State or Government are announcing the idea of a moratorium on the enlargement of Europe and that, on the other hand, in the Council, they are leaving all the doors open?

Mr Blair, the citizens of Europe no longer agree. It is now time to stop the doublespeak, because it has led to the worst. Mr Blair, you have much to prove to gain our confidence.

  Hannes Swoboda (PSE). – (DE) Mr President, you, Mr Blair, are entering into a difficult inheritance. Yesterday, Mr Juncker was in this Chamber, and we very much appreciated and applauded his commitment – an emotional commitment – to the European cause. You, today, have told us the other half of the truth, a great deal of which I can understand, and if many Members of this House were to rid themselves of the prejudices they have accumulated over recent years, they would find a lot in what has been said today that they would agree with.

What Europe needs, though, is wholehearted commitment, both on your part and on that of your country. The British press and public being what they are, that will not be easy, but what is needed is an opt-in rather than an opt-out, and I hope that you, as President-in-Office of the Council, will be putting the case for one.

Let me mention a few issues, starting with unemployment, in respect of which you, in the UK, have notched up some enormous successes. Any objective observer must concede that. Having had very high unemployment during the Thatcher era, it is now very low, among the lowest in Europe. That is the sort of thing we need, although – as Mr Schulz said – we also need jobs that confer dignity, particularly in view of enlargement. I am very grateful to you for the sympathetic things you had to say about enlargement, but we have to ensure that there are no new divisions, and that the workers from Eastern Europe, who are, alas, perennially underpaid, are not exploited.

Secondly, there is the issue of the services directive, and about this you are entirely right; although we need a common market in services, we have to create one step by step, and we also need something that you mentioned only indirectly, namely public services. As you yourself said, manifest deficiencies mean that the United Kingdom has to make massive investments in such public services as transport, health and housing, and that sort of investment too must make up the shortfall in the services sector, which we are in the process of liberalising.

This liberalisation process is something that people will accept if they see that this Europe of ours is all in favour not only of a common market, but also of the public services about which they care a great deal.

You are entirely right in what you say about enlargement. We cannot call a halt to it, but we must make better preparations for it, both in the new Member States and in the existing Member States of the European Union, for the argument was often – and wrongly – deployed that enlargement would be to the detriment of the existing Member States. You were right to say how false that is, but that is something we have to get across to our own people.

Foreign policy will also be a decisive factor. Great Britain, the country of which you are the Prime Minister, has traditionally had good relations with the United States of America. You enjoy especially good relations with President Bush, and that can be to Europe’s benefit, provided that it is clear that you speak also for Europe; provided that it is clear that the position you represent in Washington is Europe’s. If you do that, we will be right behind you.

One of the greatest projects – and one to which you referred – is the Middle East. We need peace in the Middle East, for – far from being just any old region of the world – the Middle East is our own back yard, our own neighbourhood, and we need peace to be concluded between the Palestinians and the Israelis. You have undertaken to play a very active part in bringing it about, and have indeed already been doing so over recent months, but the critical stage will come – as we must be aware – with the withdrawal from Gaza, which is imminent. The European position cannot amount to ‘Gaza first and last’; we have to take a more progressive line here.

Lastly, I urge you to cultivate your good relations with the Americans, but London is closer to Brussels than to Washington. Even if President Bush needs you in Washington, we need you here in Brussels.

  Chris Davies (ALDE). – Mr President, Europe will never be brought closer to the people, and national parliaments can never hope to hold Ministers to account so long as Europe's most powerful law-making body continues to meet in secret. Is it any wonder that people complain of a democratic deficit in Europe when debate about new laws in the Council of Ministers takes place behind closed doors?

The Prime Minister will recognise this failing. In signing the Constitutional Treaty he accepted that the Council should meet in public when it deliberates upon legislative acts. But no referendum or treaty is required, just a simple vote in the General Affairs Council. The support of just 13 Member States is an easy task. It is a quick win.

The Prime Minister says it is time for Europe to make choices. So here is a simple one for him to make: maintain the culture of secrecy or put the principles of openness and transparency into practice.

(Applause)

  Jillian Evans (Verts/ALE). – Mr Blair, I listened very carefully to your presentation, in particular the emphasis on solidarity in combating poverty. However, the delay in the agreement on the EU budget means that my constituency, West Wales and the Valleys – an Objective 1 area – has lost its chance for full convergence funding after 2007. While the UK Government focused on retaining the rebate, Wales lost up to GBP 3 billion and next year will be too late, so the UK’s interest was not in Wales’ interest.

I want Europe to change. We want a Europe where nations like Wales can play a full part in their own right. It is essential that we make Europe more relevant to people. In line with that aim and following the example of the Irish presidency, and more recently the Spanish Government, I call upon the UK presidency to request that Welsh be made an official language of the European Union. To translate that into Welsh myself as I have to do in this Chamber at present:

(The speaker spoke Welsh)

  Eoin Ryan (UEN). – Mr President, I would like to extend a failte mór to you, Mr Blair, and to wish to well in your presidency of the European Union. We are all aware of the challenges that lie ahead for the European Union both economically and socially. I want to support what you said earlier on and I agree with you, if we want to see a maturing and a strengthening of the European social model, we need vibrant economies, that is plain for everyone to see.

Last week's events, however, saw an unfortunate and heated debate on the financial situation of the European Union. Some of that debate unfortunately centred around the common agricultural policy. Opinion is greatly divided on the effectiveness and the long-term sustainability of the common agricultural policy, but one of its most ambitious aims is to support and sustain the European Union’s rural communities, which are under serious threat.

We live in a world where half a million people move from a rural environment to an urban environment every single week. In 1970, 63% of the world's population lived in a rural environment, in 2020 it will be 45 per cent. The challenges that lie ahead are great, not just for the quality of life for those who reside in an increasingly urbanised Europe. Bearing that in mind, I would ask you, Mr Blair, to concentrate on the urban problems as opposed to dismantling the CAP, which hopefully will strengthen rural communities in the years ahead.

  James Hugh Allister (NI). – Mr President, after the rejections of the Constitution, the Prime Minister rightly said that profound questions now arose about the future of Europe. From the example of last weekend, it is clear that the over-centralised EU is presently not working. Although Mr Juncker, yesterday, sought to make the United Kingdom a scapegoat, the reality is that it is the structures and policies of Europe which are fatally flawed. I suspect from your speech, Mr Blair, that you are not prepared to face the real questions that arise from that. Sticking-plaster politics do not work. You should know that from Northern Ireland. Ever-closer union has failed. It is time to embrace the primacy of the nation states over the stifling control of Brussels. It is time to repatriate key powers. It is time to return to making free trade, not political union, the cornerstone of Europe.

Finally, I urge you, as Prime Minister, to continue to take a firm stand in defence of the justified rebate, which you can properly defend on its own merits …

(The President cut off the speaker)

  József Szájer (PPE-DE). – (HU) Mr President, as one of the first Members of this House from the new Member States to take the floor, I must begin by saying that it was not because of the new Members that either the Constitutional Treaty or the budget debate have brought about a crisis in the EU. The crisis was generated by the EU-15. I am convinced that the example of the dynamic new Member States, which have implemented colossal changes over recent decades, can revive the often ossified European economy, and bring jobs, growth, a secure, family-oriented and citizen-friendly Europe.

When looking for a way out, let us begin with the unjust and unjustified discrimination that still persists within the Union. Prime Minister, your country is one of the few that has not taken fright at workers from the new Member States. The task is this: throughout Europe, we must immediately clear the obstacles obstructing the new Member States citizens’ freedom to work. Prime Minister, you said that the common agricultural policy is untenable in its present form. But do not forget that farmers in the new Member States now only receive a fraction of what the old Members get. Our task is to reform the common agricultural policy, but let us also begin to eradicate the internal inequalities, and let Polish, Hungarian and Estonian farmers receive the same support that their Austrian, French or British counterparts are entitled to.

Prime Minister Blair and President Barroso, both of you also referred to the need to make Europe competitive. Today, however, it looks as if Europe has baulked at competition. The task that faces us in this regard is to dismantle the barriers to free movement of services, for although services account for the largest share of the European economy, their free movement is a freedom which so far exists only on paper. Let us adopt the Services Directive! Prime Minister, you spoke of Europe’s renewal, and rightly so. Let us begin the process of renewal together, all twenty-five of us, without unjust, artificial and internal discrimination.

  President. That concludes the debate.