The £1.7bn question - who's right: Osborne, Farage or the European Commission?

Below we give a blow by blow breakdown of what George Osborne did or did not secure at today’s EU finance ministers meeting. This basically comes down to the UK’s rebate and how it’s applied - and whether it was always going to apply to the £1.7bn.  Osborne claimed that:

As PM said EU bill unacceptable. Now we've halved the bill, delayed the bill & pay no interest on the bill. Result for Britain
— George Osborne (@George_Osborne) November 7, 2014

Whilst Ukip leader Nigel Farage has claimed that:

Osborne trying to spin his way out of disaster. UK still paying full £1.7bn, his credibility is about to nose dive.
— Nigel Farage (@Nigel_Farage) November 7, 2014

This is what EU Budget Commissioner Georgieva said at a press conference just now:

“As we all know the UK receives a rebate on their contribution, but in years when the UK has to pay additional because of GNI corrections, normally this payment would be on 31 December and it would be in the full amount. With the proposal [under discussion]…in exceptional years this period of time would be stretched into the next year, and when this happens, and it would be in these exceptional circumstances, then the payment and the rebate on the payment could converge. In a normal year, they would not. In a normal year, you have a payment on 31 December and then next year, in the spring, we have the calculation of the rebate on this payment.” 

So who’s right?

Well, Osborne is right that the UK will pay half of the initial £1.7bn demand, since the UK’s rebate will now knock off the difference. So in that sense, Farage is wrong. Britain “will not pay the full £1.7bn”. However, the Government’s position isn’t’ entirely what it seems either, since it’s possible (though still not clear) that the rebate was always going to apply to the £1.7bn.
 
Confused? Don’t worry. Few people know how the rebate actually works. Below is our attempt to clarify the issue.

What has actually been agreed?

• The UK secured a delay on its payments and will now have until September 2015 to pay. It will probably pay in July and September 2015.
• It was also agreed that the UK’s £1.7bn bill will have the UK’s rebate applied to it (in the same way all annual contributions do). The Government claims that it wasn’t ever clear whether the rebate would apply, however, Commissioner Georgieva’s suggest that it always would. Usually  the rebate operates on a one year time lag, but now it will be netted off at the same time when the payment is made. The UK government also claims that the rebate applied to the specific amount is above and beyond that which applies normally, due to the way different facets of the rebate are applied and the time period over which it was calculated (we're still looking into this one). 
• This accounts for the reduced the bill from £1.7bn to £850m.

So, Osborne has effectively achieved an ‘interest free’ payment plan for the surcharge, which will see it coincide with the rebate on said surcharge.

Would this always have happened?

• It has been unclear for some time how the rebate would factor in here. Either people were purposefully trying to obscure the question or it was genuinely unclear.
• However, now that it has been settled that the rebate would be applied, it can be said that this reduction would always have happened. The main change is that the rebate has been moved forwarded allowing the initial payment to be reduced.
• On net the UK will pay £850m, but this should always have been the case thanks to the rebate.

Does this impact other countries?

• Since other countries essentially pay for the UK rebate, they will on net be hit.
• Our understanding is that the countries will still get the full amount expected from the GNI calculations – i.e. France should still get €1bn.
• That said, since the rebate is being paid and also a year early, it is likely that their annual EU budget contributions will increase in 2015. On net then, the gains for certain countries (such as France) could actually be less than expected.

So are we looking at a cash flow problem for the EU budget?

• One outstanding question is how this will all work in practical terms. Judging from the European Council conclusions, countries who are getting a pay-out from the GNI calculations can still claim the money on 1 December.
• However, countries who are paying in large amounts can delay their payments until September 2015. It is not clear whether there is enough spare cash in the budget to smooth over this gap.
• Furthermore, the UK is using its rebate to offset its payment. This will not be covered until all countries have paid in their (higher) annual EU budget contributions next year. This further worsens the cash flow problem.

A political conspiracy or genuine uncertainty?

• Questions will now swirl around when all this was known. Surely, if the rebate applies, that was always known to be the case? Logically, since all UK contributions are subject to the rebate, it always was going to be. The only thing that wasn’t entirely clear was when and how it would be factored in. While this is tricky to work out, it’s not clear why the HM Treasury and the European Commission let the dispute run for two weeks. If this was a “set up” by the UK government to claim success, then the Commission was in on it.
• Maybe the handover in Commission has helped breed uncertainty.

So what’s the verdict? Who’s right, Farage, Osborne and Georgieva? Well, Farage is wrong, Osborne right on the amount but may be exaggerated the extent of the concession. The most right is probably Georgieva - though, we still don't have evidence that the rebate was always going to apply.

And of course, the UK will still pay an additional £850 million.

We will update this as events unfold, but what a mess.

Have the EU Referendum Bill's chances just improved?

Labour won't be there on 5 July

We have heard today that the Labour Party have decided not to turn up and vote on 5 July on the Conservative-sponsored Private Members Bill on an EU referendum. As we have written before, the Referendum Bill faces many hurdles before it has a chance of becoming law but if Labour abstain on 5 July it does help its chances. So what are its chances now - here is a recap.

1st Reading  - 19 June - We will get the name of the Bill but not necessarily the final text. At this stage there is no vote as all that happens is the Bill is lodged before Parliament.

2nd Reading - 5 July  - 100+ Conservative MPs are needed to turn up on the Friday to secure the closure of the debate. This is followed by a vote on the Bill itself - which now, without Labour opposition, will presumably pass.

Committee Stage. A lot might depend on who chairs the Committee and whether anyone tries to bog it down but it is still possible the Bill will survive the Committee and get to report stage.

Report stage. At report stage any MP can table amendments. If the Labour Party wish to derail the Bill this could be their chance. If it passes it would then be voted on at 3rd reading.

3rd Reading. If it has survived to this stage it would be interesting to see what the Labour Party and the Liberal Democrats do next. Do they change their mind and vote against the Bill or risk it passing and heading off to the Lords unopposed? But if the plan is to vote against at 3rd reading why not vote against on 5 July on the principle of the issue? And what of Conservative MPs - will some be tempted to table their own amendments on issues such as timing and the meaning of renegotiation?

As always with matters EU it is likely to become a political football. So will the Bill get to the Lords? On balance, it is still difficult, but its chances have just improved.

EU referendum: What will the Tory backbench motion actually achieve?

Unlikely to care if her speech is amended - but will anyone else?

Politicians do not as a rule like other politicians amending their speeches especially after they have been delivered. The Queen is not a politician and is usually spared this indignity - but not if one group of (mostly Conservative) MPs have their way. Although, strictly speaking, the MPs have not tried to amend the speech per se, they merely tabled a motion to "express regret" that it did not include legislation for an EU referendum.

This is unlikely to upset the Queen, she will not have had any personal commitment to the political mush written for her by Number 10 (in case any non-UK readers were confused). The amendment states that the House:

"respectfully regrets that an EU referendum bill was not included in the Queen's Speech".

This means that even if passed by a majority of MPs, it wouldn't actually force the Government to table a bill. So what's the point? John Baron, one of the MPs tabling the amendment, said the objective is to show that:

"there is a large body of opinion inside and outside this place that believes that legislation is right for a EU referendum."

This will no doubt make the 'ditch the EU' story run for another week, but the problem for those who genuinely want to legislate for a referendum in this parliament is that even the early referendum enthusiasts all want different things. Tory MPs who have put their names to it have several aims: legislation enshrining Cameron's 2017 referendum, a mandating referendum to enable re-negotiation, or most simply a straight in/out referendum now (though many oppose this on the basis that it would generate an In vote and thereby kill the issue - and any prospects for substantial reform - for a decade or more).

So this vote is unlikely to achieve much since it suffers from a lack of political  focus. It seeks to be all things to all people.

However, this is not to say that from a Tory point of view, there aren't any benefits from such a 'stunt vote' on a referendum of some sort (we've looked at the different options here). It could demonstrate that David Cameron can be trusted to keep his word - no good making a popular promise if people don't believe you. The second attraction for the Conservatives is that in the 2015 general election, they could use the vote both to target specific Liberal Democrat and Labour MPs who vote against, and also as a shield when faced with a buoyant UKIP threat.

But again, the amendment tabled today won't achieve any of that.

There are, however, more clever routes. For the stunt to work, it probably will have to be included in draft legislation that is going somewhere - and with sharper wording. There are two ways. First, a Private Members ballot: this is basically a giant raffle where MPs put in requests for all kinds of stuff. If this is successful, an MP could chose to put forward a referendum, possibly just cutting-and-pasting the draft legislation that the Conservative leadership has promised to publish before the election (but not put to the vote). Absent a successful ballot MP-led legislation has virtually zero chance to succeed. The other way they could achieve a vote is to table an amendment to another EU-related Bill. Here, MPs could be exceptionally creative. There's one coming up:

European Union (Approvals) Bill: will provide Parliamentary approval under the European Union Act 2011 for ministers to vote in favour of various proposals in Brussels: Pericles (anti-euro counterfeiting); Europe for Citizens (EU civic integration); and EU Archives (formalising the depositing of EU documents in an archive).

If the draft legislation is thought to be general enough, it's conceivable that the clerks (who will ultimately decide whether the amendment is allowed) could allow an MP to add an amendment calling for a referendum. There could also be other legislation, such as on the EU budget.

Given that even if passed next week's amendment is non-binding, and that its vagueness allows people to vote in favour for a variety of reasons, we are not sure how much this initiative will actually achieve.

House of Lords isn't getting with the programme

Almost entirely unnoticed by the UK media (with the exception of the Guardian), the House of Lords is doing its best to rip the heart out of the Government's EU Bill and accompanying "referendum lock". The Government last night suffered its third and fourth defeats on the Bill in a week, with peers voting by 242 to 209, to modify the Bill's "sovereignty clause" and by 209 to 203 to introduce a "sunset clause", which would see the entire Bill lapse at the end of this Parliament.

We have always felt the sovereignty clause the less important aspect of the Bill compared with the referendum lock but the latter, designed to give Parliament and voters a say over any significant future transfers of power to Brussels, has now been attacked and severely mauled by peers.

On Monday, peers voted to restrict the issues on which referendums should be held to only three: joining the euro, the creation of a "single, integrated military force", and changes to border control. This would leave the public without a say over several important issues such as whether a future UK Government could sign up to the creation of a new European Public Prosecutor or give up arguably the UK's most important veto of all: it's right to veto the multi-annual EU budget.

And, in the words of Foreign Office Minister Lord Howell, these amendments completely "undermine the direct and frank and honest commitment that we wish to make to the British people...I really would suggest that the public can be trusted to determine what is in their own interest."

As we've noted before, there is a certain irony in the fact that it is an unelected body, the House of Lords, which is displaying such great suspicion and hostility to giving people a greater say over their country’s relationship with the EU - and peers have given us some unintentionally hilarious quotes during the often bizarre debates on the Bill (we'll give you a few samples shortly). But the fact that it is being allowed to do so completely under the political radar is probably even more worrying.

The political lesson from the Portuguese bail-out: don’t give up EU vetoes

Over on Conservative Home we argue that the main political lesson for the UK government from the Portuguese bail-out is don’t give up EU vetoes without thinking through all possible consquences. We argue:

"And here’s the thing, the reason why the UK is now required to underwrite a Portuguese bail-out to the tune of £3-4 bn (partly via the EU budget, the legality of which is dubious, party via the IMF, which is fair game) isn’t Alistair Darling, who signed the emergency bail-out deal in May last year, or George Osborne, who allegedly was consulted by Darling. The UK long ago gave up its veto over the part of the EU treaties – the now infamous article 122 – that can be used to commit Britain to financially assisting an EU country in trouble, if that country is hit by a “natural disaster” or “occurrences beyond its control.” Even if Darling, or Osborne for that matter, had objected to the emergency EU bail-out fund last May, they would probably have been outvoted as the decision was subject to majority voting (whether a UK Chancellor, even if he had had a veto, would have wanted to block the deal, given the enormous financial and political pressures at work is also open to debate).

The question then is, whose brilliant idea was it to give up the veto over article 122 – which has effectively become the financial equivalent to Nato’s Article 5 on mutual military assistance?"

To get the answer, read the full post.

A bizarre evening in the House of Lords

In case you missed it (and chances are that you did), last night's debate in the Lords on the Government's proposed EU Bill and 'referendum lock' was a bizarre affair, with many of the peers literally being all over the place. For a while there, it reminded us of some of the debates we've come across in the European Parliament - in many cases, what was said didn't actually correspond to anything taking place in the real world, nor any shade of public opinion.

We have looked at the 'referendum lock', which we're broadly in support of, on several occasions and argued that it would have been a much better 'lock' if it had incorporated the transfer of crime, justice and immigration laws - the Coalition has said it will continue to make its decisions to 'opt in' to these new laws on a case-by-case basis (and it continues to do so in roughly two-thirds of the cases it has the opportunity), rather than via a formal mechanism that could give MPs and the electorate some control over these transfers of power.

But back to the debate. A sign that something is broadly hitting the right note is when it is attacked from both sides. The Bill has been attacked for both preventing any future EU integration and as a sell-out by those who feel it won't stop the transfer of powers to Brussels (many of these people's real problem with the 'referendum lock' is that it doesn't roll back the existing transfers of power, which it was never designed to do) . Now, surely, both cannot be right.

Former Tory Minister and Conservative peer Lord Deben was seemingly having a particularly bad day, suggesting that the Government was pandering to "head-bangers". He added that he was "ashamed" of the Government's plans to hold referendums on whether to approve new EU treaties or major changes to existing ones and promised to vote against the legislation "again and again and again" unless changes were made.

The irony of an unelected peer being "ashamed" to consult the British people on major transfers of power to the EU (including the unelected Commission and unelected ECJ) - seems to have been lost on the noble Lord Deben. This is the full quote:

I do not believe in referenda in any circumstances. They are wholly unsuitable in a parliamentary democracy; they are a foreign invention used by people for ulterior motives; and they have never been part of the sort of society in which we live. I am ashamed that my Government have brought this forward.

Er, out of touch? The argument that the Bill would lead to referenda being held on every minutiae of EU policy seems to have gained credence amongst the peers discussing it yesterday. The only problem is, this argument is absolute nonsense, which anyone who has followed just a bit of EU politics over recent years would realise.

The Bill only covers transfers of competence under a new treaty or through changing the existing treaties - some of the major the "passerelle" clauses will also trigger a referendum. But there are a lot of stuff that won't trigger a public vote, because of what the EU already can do within its existing legal framework.

To get an idea of the kind of action that the EU can take without touching the Treaties, take the creation of the eurozone's €60bn temporary bailout fund, the EFSM. The hugely controversial decision to reinterpret EU law, through a qualified majority vote, and ignore the existing "no bail-out" clauses in the Treaties did not require a treaty change and therefore wouldn't have been caught by the lock. Or take the creation of three new EU financial supervisors, with binding powers over national authorities - again, that decision was taken by a qualified majority vote. A Treaty change wasn't even on the cards.

Rather than trading in hyperbole, Peers should focus on the meat of the Bill and seek to improve it, so that some trust can be restored in politics. Realising that European and British politics have moved on since the 70s/80s/90s (take your pick) would be a good place to start.

Incidentally, if ever you thought that the Lords were more mature than their counterparts in the Commons and less susceptible to ‘Punch and Judy’ knockabout, check out these comments from Lord Kinnock (whose family we’d point out earned a tidy £10m at taxpayers' expense during and after its stint in Brussels) directed at UKIP peer Lord Pearson:

My Lords, when the noble Lord, Lord Pearson of Rannoch, says that he wants to stick to his guns, I am inclined to hope that he goes very near to the muzzle of those guns-indeed, just in front-because that would be a suitable location.

Now that’s not very nice, is it Neil?

MPs could learn a thing or two from MEPs

Last night MPs debated amendments to the EU Bill to strengthen Parliament's power over the Government on decisions about which EU crime, justice and immigration laws the UK signs up to. These were not abstract or merely technical points. This was about transferring power from the executive to the legislature (and therefore a step closer to MPs' constituents) over lawmaking that can have a material impact on people's lives. Once again, we would point you to the European Arrest Warrant or the EU laws requiring the UK to recognise trials in absentia or decisions on asylum - these are no trivial matters.

We could also point to the 90 or more EU laws that the UK Government could either decide to opt out of altogether in 2014, or remain signed up to (giving EU judges new powers.) The fate of 90 (or even 100 depending on how you count) laws will be decided in one go, in a one-off decision. You'd think MPs should take a bit of interest in such a choice.

But the vast majority of MPs apparently didn't want to know. The sea of empty green benches was evidence of that. Consequently the amendments were not pushed to a vote and the Government will be able to continue opting in to new EU justice and immigration laws, unhindered by any real Parliamentary control.

The Government has pledged to consult with Parliament about giving MPs and Lords more power to scrutinise and potentially vote on “significant” new EU justice and immigration laws. But MPs need to be much more assertive in demanding greater power over EU affairs if it is to become anything more substantive than a pledge to merely consult.

An amendment to put the crucial 2014 choice was defeated 313 votes to 26 under a three-line whip. The Government has committed to put this choice to both houses, which is welcome, but we had hoped for a bit more excitement yesterday on this issue.

There's just something missing.

In a strange kind of way, MPs should learn from Members of the European Parliament here. Those who occupy seats in Brussels and Strasbourg are open about their thirst for greater powers and do all they can to grasp them (usually leading to unwanted and out-of-touch decisions unfortunately - but that's a different discussion). On EU matters, the contrast to Westminster is stark.

And ironically, there's a clear, inverse relationship between the clout of MEPs and the clout of MPs in the areas that were discussed yesterday: every new EU immigration, crime or policing law that our Westminster representatives allow the Government to opt in to will see MPs losing a chunk of power, with MEPs correspondingly gaining the same level of power (as EU JHA laws are decided jointly by ministers and the European Parliament).

Usually it's a noble thing to say no to power, but we fear this is a matter of our elected representatives being happily unaware, not realising that they're outsourcing some of their key responsibilities to bodies that usually (though not always) aren't equipped to balance democracy, law and justice in a union of 27 different legal systems.

If MPs are not willing to put down a marker and fight for some of their own, how can they possibly complain about the 'diminished role of Parliament' or wonder why people out there in the real world continue to ask what their representatives in Westminster are actually paid for.

Come on MPs - you can do much better than this.

This is why the EU Bill should be amended

The Government on Friday published an annual report that reveals which, and how many, EU crime, justice and immigration laws the UK signed up to between December 2009 and December 2010.

The report states (p4) that the Coalition Government has opted in to eight new EU justice and home affairs laws since coming to power in May 2010, including the hugely controversial European Investigation Order, a new "IT Agency" to oversee the EU's vast crime and immigration databases (with start-up costs of around €113m), and granting United States' authorities access to European citizens' banking data under the so-called SWIFT agreement.

These are all transfers of power from the UK to the EU but Ministers were free to sign up to them without any democratic checks - Parliament had no say.

The Coalition has said it wants to operate a case-by-case policy of deciding whether to opt in to new EU justice and home affairs laws. Well last week's report shows what that policy amounts to in practice. Of 13 decisions whether to 'opt in' or not, the Government opted in 8 times. That's an opt in percentage of 62%.

The Government's record so far would suggest then that the UK will continue to play a major part in the EU's ever-expanding role in justice and home affairs. But under the current EU Bill, Parliament and voters have no say over the steady steam of laws that are transferring power over British justice and immigration policy to the EU level.

This is why amending the EU Bill is so important. Allowing the status quo to continue simply widens the democratic deficit between the Government and the general public on these crucial issues. Crime, justice and immigration are important to people and voters do not expect their Government to have free reign to hand over powers to the EU in these areas.

We hope that as many MPs as possible make their voices heard when these issues are debated tomorrow and that they impress on the Government the need for Parliament and voters to have more say over this crucial aspect of the UK's relationship with the EU.

Is the Miliband amendment a trap?

The EU Bill's referendum lock is today coming before Parliament, with its different parts debated and voted on between today and Wednesday (see here, here, here, here, here, here and here).

At the eleventh hour, Labour leader Ed Miliband has tabled an amendment that would effectively remove the opportunity for a judicial review of any decision taken by Ministers and Parliament, amid concerns that the power of Parliament might in future be weakened at the hands of judges.

We can certainly see the appeal of this amendment from MPs' point of view, as it appears to strengthen Parliament. However, the bigger risk is that it - for all practical purposes - simultaneously waters down the referendum lock. MPs should therefore think twice before supporting this amendment.

For what it's worth, here's our take:

- Ed Miliband’s amendments to the EU Bill centre on the creation of an “EU referendum committee”.

- This Committee of 19 members would be comprised of MPs and Lords (but not Ministers) who would make recommendations on whether to hold all referenda provided for in all the various sections of the Bill.

- The recommendations would be put to both Houses of Parliament for approval of the Committee’s decision on whether to hold a referendum or not.

- While the creation of an ‘independent panel of Parliamentarians’ to decide on referenda may sound appealing, the Committee’s recommendations would override the Bill’s clauses which would automatically provide for referenda on decisions identified in the Bill, which are the key safeguards against power being handed over from Westminster to Brussels. Only “significant transfers” as decided by the committee and voted on in Parliament would qualify.

- Therefore Labour’s amendments could well have the effect of raising the threshold for holding referenda on transferring powers to the EU.

- Should the government of the day hold the balance of power in the proposed “EU Referendum Committee”, there would be nothing stopping a new EU treaty or treaty change being pushed through Parliament by the government. This could see a repeat of what happened to the Lisbon Treaty, which, as we all remember, was pushed through Parliament, without a public vote, despite the three major parties pledging a referendum on the treaty.

Update on the EU Bill - the Government's response to JHA opt ins

Earlier today, the Government released a statement setting out what it intends to do on the Justice and Home Affairs 'opt-ins' and the crucial 2014 choice between more or less EU control (see here, here, here and here for more from us on this).

On the 'opt-ins' the Government seems determined not to include any language in the actual EU Bill that would require it to get Parliamentary approval before it can opt in to a new EU law in crime, policing and immigration. Instead, it says that this should be addressed separately with the details to be decided at a later stage. Crucially, only the proposals generating a "particularly strong" interest could, possibly, be put to Parliament. In the Government's words:

in circumstances where there is particularly strong Parliamentary interest in the Government’s decision on whether or not to opt in to such a measure, the Government expresses its willingness to set aside Government time for a debate in both Houses on the basis of a motion on the Government’s recommended approach on the opt-in.

From the looks of it, this is not a strong enough safeguard. The big question is who decides what counts as "particularly strong" interest. We remain convinced that in order to avoid situations where future EU proposals in Justice and Home Affairs are debated at the convenience of the Government (which is the case at the moment), all opt ins should be subject to Parliamentary approval (there are pragmatic ways to deal with minor proposals, without throwing the baby out with the bathwater).

On the crucial 2014 choice, the Government clearly commits to putting this to a vote in both Houses. This is encouraging, though again, they should put that into writing in the EU Bill, so that it would be beyond doubt. A political agreement/commitment can be altered, which we all know too well when it comes to EU matters. The statement reads:

Parliament should have the right to give its view on a decision of such importance. The Government therefore commits to a vote in both Houses of Parliament before it makes a formal decision on whether it wishes to opt-out. The Government will conduct further consultations on the arrangements for this vote, in particular with the European Scrutiny Committees, and the Commons and Lords Home Affairs and Justice Select Committees and a further announcement will be made in due course.

In other words, there's much to play for here. Are MPs paying attention?

More on the referendum lock

Some more from us on the referendum lock...

On Conservative Home, Open Europe chairman Lord Leach argues in favour of tweaking the EU Bill to strengthen democratic controls over the key areas of EU law that we've highlighted.

We also have a piece on the Spectator Coffee House blog.

Just one quick additional thought: the "more or less EU" choice that the Coalition will face in 2014 potentially involves some 100 or more EU laws and measures. The Government must decide to either accept or reject these en bloc. 100 laws! Imagine if the government had to decide in one go whether to adopt 100 domestic laws, regulations and measures. And if we then were told that this was not going to be debated in Parliament...?

You can see why this choice matters and the EU Bill needs to be amended to allow for this to go through Parliament.

When will this register in Westminster?

Which MPs will stand up and be counted on the EU referendum lock?

The Government's EU Bill returns to Parliament next week, with MPs considering amendments to the 'referendum lock'.

At the moment there is no democratic control over which EU crime, justice and immigration laws apply to the UK – neither MPs nor the electorate have a say over these decisions, only the Government. With a new briefing published today, we have stepped up our campaign to see the Bill amended to give Parliament, and in some cases voters, a say over whether Ministers sign up to these laws.

The crux of the matter is that next week MPs have the chance to give themselves increased power over the Government, allowing them to debate and approve these hugely important EU laws that will have an impact on their voters.

And there is another hugely significant issue here.

Before 2014, the Government has to decide whether existing EU crime and policing laws (those introduced before the Lisbon Treaty came into force late 2009) continue to apply to the UK. If they continue to apply they fall under the full jurisdiction of EU judges at the ECJ.

This is a massive 'more or less EU' decision that should not be left entirely up to the Government, which it would be under the current Bill. This should be decided by the people or, failing that, Parliament.

Do MPs really want to explain to their constituents that they passed up on the opportunity to have a vote on EU crime or police laws such as the European Arrest Warrant agreed in 2002, which has seen numerous Britons extradited to other European countries on spurious charges?

These are laws that have a direct, and sometimes costly, impact on people's lives - this is no time for MPs to duck the question.

How should MPs vote on the EU bill today?

MPs will today vote on the first part of the EU Bill - the so-called sovereignty clause, which stipulates that EU law exists only by virtue of an Act of Parliament. Some Tory MPs have opposed this clause on grounds that the explanatory notes of the Bill states that it reinforces the “common law principle” that EU law takes effect through the will of Parliament – which implies that judges could at some point take it away (since common law is effectively decided by judges).

As we've noted in previous posts, the clause itself, however, clarifies - and arguably strengthens - the notion that Parliament holds sovereignty over EU law. If allowed to stand alone, this can be no bad thing. So much of the fuss is in fact about the explanatory note, which can easily be changed (MPs may of course feel that the Government should do a lot more to address the current balance of power between the EU and UK - and they would be right - but let's take one battle at a time).

We now hear that Europe Minister David Lidington, sensibly, has written to backbench MPs saying that the Government will change the wording of the explanatory note to remove the confusing reference to 'common law'. There's therefore little reason to be nervous about the sovereignty clause.

With this change out of the way, MPs should now focus all their efforts on making the referendum lock - the second part of the Bill (to be discussed tonight, if there's time, and in more depth in a week or two) as strong as possible. As we've argued before, a strong referendum lock could substantially strengthen day-to-day control Parliamentary over EU laws.

Read more from us here and here.

How important is Clause 18?

Is Cameron facing defeat over the EU Bill tomorrow? Some have flagged up that prospect though we suspect the Bill will see it through tomorrow's debate in the Commons unscathed (backbench Tory MPs have differing priorities, Labour MPs are a bit all over the place and Lib Dems are not flip-flopping for a change - you work out the odds).

The so-called ‘sovereignty clause’ within the Government’s EU Bill is currently the subject of some criticism and debate, and this is the part that will come up for discussion in Parliament tomorrow (the rest of the Bill will be left for the following week or later).

Some important questions have been raised about the sovereignty clause but, arguably, they relate more to domestic concerns about the constitutional role of Parliament than the UK's relationship with the EU (though a link clearly exists). Irrespective of the merits of arguments on either side, the sovereignty clause should not be confused with the 'referendum lock' (which the vast majority of the Bill is concerned with) that seeks to identify areas where EU power can be extended and introduce some national controls on them.

These are two discussions that should have always remained separate.

The Government, and William Hague specifically, argues that Clause 18 of the Bill “confirms and affirms the position that EU law in this country is only recognised by virtue of the authority of acts of Parliament.” The Government says that it is attempting to “address concerns that the doctrine of Parliamentary sovereignty may in the future be eroded by decision of the courts”.

But some backbench Tory MPs have noted that the Government’s assertion, in the explanatory notes, that the Bill reinforces the “common law principle that EU law takes effect in the UK through the will of Parliament and by virtue of an Act of Parliament” contradicts this very aim. As Bernard Jenkin MP argued yesterday, “The common law is judge-made law. The judges are its authors and its guardians. They may change it whenever they see fit.”

The argument goes like this: by legally rooting Parliamentary sovereignty in common law, the Government would in fact be inviting judges to become more involved, leading to the logical extension that, if Parliament is sovereign because of a decision of the courts, the courts can just as easily change their minds. As Jenkin notes, Parliament is sovereign because Parliament is sovereign. This is the principle of the UK’s constitutional settlement.

A valid question is also whether Clause 18 was necessary at all? Did anyone really dispute whether Parliament could choose to repeal the 1972 European Communities Act at any point in time should it want to? (the Commons EU Scrutiny Committee's report and evidence on the topic is pretty interesting if anyone should have the appetite to trawl through it).

It is no accident that it is the EU that has sparked this debate. The lack of a formal written constitution leaves the UK hugely exposed to the EU’s centralising instincts.

But confusing this discussion with the other, in our view, more important aspect of the Bill, the referendum lock (we wouldn't rule out that the Government may have done this intentionally) runs the risk that MPs do not focus enough of their energies on closing the loopholes in the Bill that deal with transfers of power to the EU. We have identified several relating to justice and home affairs but there are also other areas where the Bill needs tightening up, and Tory MPs have done a good job in tabling sensible amendments. These amendments would strengthen Parliament's de facto powers the second the Bill came into force. That would be a step forward for parliamentary democracy, and a very practical one at that.

Constitutional debates about the role of Parliament are of course important but they will also no doubt roll on. However, this may be the only chance to get the practical measures within the Bill right and in our view they should therefore be the primary focus for MPs.

That's an argument in favour, not against Mr. Foreign Secretary

Tuesday night saw the Coalition government's EU Bill sailing through a second reading in Parliament, without a vote. In truth, it wasn't all plain sailing as several MPs - from across the aisle - fired at the Bill with various degrees of ferociousness. "Legislative PR", "flawed", "smoke and mirrors" and "missing the point" were some of the comments.

Valid points were raised - though as we've argued before, the referendum lock is a meaningful measure that will make it more difficult for ministers to transfer power to Brussels in future (true, it doesn't deal with the mission creep of the ECJ, or with cases when EU law is blatantly broken i.e. the eurozone bail-out, or with the existing balance of power between the UK and the EU, which many feel is unacceptable).

The Foreign Secretary did disappoint on one point, however. Conservative MP James Clappison asked whether the Foreign Secretary would give "serious consideration" to the question of requiring a vote in Parliament before the Government opts in to new EU laws in the Justice and Home Affairs area - which Open Europe has argued strongly in favour of, as it would in effect roll back some of the powers given away to EU judges and MEPs under the Lisbon Treaty.

However, the Foreign Secretary answered that the decision to opt-in belongs to a "different category" and argued that

given the strict time limits which apply to the UK's decision to exercise an opt-in - which is within three months of the receipt of a proposal - and the fact that there are 30 to 40 proposals per annum, it is not possible to place a primary legislative lock or parliamentary resolution requirement on the exercise of the opt in.

This isn't a strong justification at all for leaving out such a provision. William Hague seems to argue that ‘there is so much being agreed in the EU and as a government we need time to consider it all’. But this isn't an argument against giving Parliament ex ante control over this area - on the contrary, it's a strong argument in favour of it! Precisely because that is the case, we need more democratic control.

Also, a resolution of approval is not a time-consuming measure in Parliament. Motions can be agreed after a relatively short, single debate. In fact, the Irish Parliament must pass a resolution before its Government can opt in to anything, so it seems strange that this wouldn't be possible in the UK.

What puzzles us is why not more MPs aren't passionately pushing this line?

Parliament needs to get a grip on EU justice and home affairs laws

At a time when MEPs are trying to grasp every possible opportunity to extend their own powers (and give themselves more cash), it’s about time that national parliamentarians showed some assertiveness over EU decision-making – or they risk becoming even more marginalised in EU affairs. The Lisbon Treaty shifted substantial control away from national parliaments to MEPs (hardly credible protectors of democracy in Europe), the Commission and EU judges. As a result, the UK Parliament was weakened (and the Lisbon Treaty’s yellow card procedure did not make up for this, as now is becoming increasingly clear).

But MPs now have a chance to claim some of these powers back.

How? In a new briefing published today, we argue that by a series of simple amendments to the Government's proposed EU 'referendum lock', the UK Parliament could turn itself into one of the most powerful chambers in Europe, insofar as EU policy is concerned. These amendments would require Ministers to seek the approval of Parliament before signing up to any EU laws in justice and home affairs. If the answer is No, the government can’t opt in.

This may seem like a boring detail, but on the contrary – it’s absolutely vital.

For the first time, this would give Parliament, and voters, a real democratic check on the extension of the EU's powers – although it would still fall far short of repairing all the damage caused by the erosion of democracy through successive EU Treaties.

Policing, crime, immigration and asylum are issues are hugely politically sensitive and any decisions to sign up to new EU laws in these areas need to be thoroughly debated and democratically accountable. This should be Parliament's job. As the German Constitutional Court argued in its ruling on the Lisbon Treaty:

Due to the fact that democratic self-determination is affected in an especially sensitive manner by provisions of criminal law and criminal procedure, the corresponding basic powers in the treaties must be interpreted strictly - on no account extensively -, and their use requires particular justification.

As it currently stands, the Government's proposed Bill, although a significant step forward, fails to address the day-to-day transfer of crime, policing and immigration powers from the UK to the EU. So any decision to opt in to a proposal like the controversial European Arrest Warrant will not be covered by the lock.

And the thing is, justice and home affairs is the area in which the EU gains the most new powers under the Lisbon Treaty. The EU now has two Commissioners rather than one, 17 databases and a rapidly expanding budget to fulfil its ambitions here.

Most importantly, European judges will have the final say over any law that the UK Government decides to opt in to. By definition, this is a transfer of powers.

In other words, it's a zero-sum game: every new justice or policing law the Government signs up to gives more power to the EU institutions at the expense of MPs, Parliament and the British courts. This is a big decision, which currently rests solely on Government Ministers' discretion.

The EU's growing ambitions in justice and home affairs deserve Parliament's undivided attention. It is perfectly reasonable for MPs to demand the power to vote on these crucial decisions that the Government makes in the name of their constituents. In fact, it would be a dereliction of duty not to.

Power to the Parliament

Open Europe has just hosted a debate on the Coalition Government's proposed 'referendum lock' with Europe Minister David Lidington. A write-up and recording of the event will be put on our events page shortly. But in the meantime, two thoughts:

A point raised - echoing what was argued in the Economist's Bagehot column last week - is that the referendum lock amounts to an effective "UK Veto Bill" over new EU treaties. This, so the reasoning goes, is de facto locking in a two-speed Europe, with Britain in the 'slow lane', as it would never be able to sign up to new Treaties under the Bill (assuming that any referendum on a new EU Treaty in the UK would result in a No vote).

This logic contains some truth but is also dated. In today's more fluid, interesting but also more perilous, Europe what matters is one thing: the health of your economy.

Europe is already a multi-speed beast, fuelled by the ongoing eurozone crisis. The slow lane is reserved for the countries which don't have enough cash to carry them over until tomorrow - not those which choose to stay out of the European Public Prosecutor (for example). Which lane the UK occupies in the future will depend on its economic fundamentals - not the referendum lock.

Secondly, some commentators really should read the actual Bill before ranting. Philip Stephens, who every week recycles columns in the FT, for instance. Today he argues,

It is likewise curious that a Tory party so wedded to parliamentary sovereignty should be so keen to subordinate its authority to a plebiscite. Margaret Thatcher got it right when she criticised the last popular vote on Europe in 1975. The referendum, the then Tory leader observed, sacrificed parliamentary sovereignty to political expediency.

This is wide of the mark. In fact, the biggest winner from this Bill is not the British people - a referendum is unlikely to be called for a long-time (which Stephens also acknowledges) - but the UK Parliament. Every decision outlined in the referendum lock will ultimately rest with Parliament, including whether a power shift is significant enough to warrant a referendum under the so-called significance criteria in the Bill.

In this sense, the proposal is actually more of a Parliamentary lock, than a referendum lock. What the Bill will do is restore some control to Parliament - which has been handed over to the government (and then onto MEPs, EU judges and eurocrats) through various EU treaties.

Now it's up to Parliament to decide what to do with these powers.

Ps. Stephens also argues that the EU Bill is "a piece of legislation so dense and unintelligible that it makes the Maastricht treaty seem like an easy read." He clearly has limited experience with EU treaties and texts. In fact, the EU Bill is a Stieg Larsson novel compared to much coming out of Brussels, such as the unconsolidated version of the Lisbon Treaty for example (which we were the first to decodify).