Sir William Cash:

Thank you, Chairman. I am very glad to meet the committee. We greatly value the personal and political relationship between the United Kingdom and Ireland. The Chairman and I have known one another for some time.

Speaking for myself, my own personal family relationship has Irish origins. My grandmother was a Collins from County Cork. John Bright, who was a great defender of Ireland during the 19th century, was my great grandfather's cousin. He was a great friend of Daniel O'Connell on whom I am giving a talk in the Irish Embassy in London towards the end of this year.

Frederick Lucas was a Member of Parliament for County Meath, which is not very far from the Chairman's constituency of Meath East. For practical purposes I feel very strongly about the Irish involvement. At the more immediate and practical level, I think I was the first to recommend that we should make that £1 billion loan to Ireland at the time of its financial troubles a few years ago. I was greatly heartened to hear what the Minister of State said just now regarding the improvement in the Stability and Growth Pact. I wish the country well because that is the way I feel about Ireland.

I would like to say also, because everything is not always sweetness and light, I recognise there are differences of opinion about the general question of the relationship of member states to the European Union and the need for change in that relationship. It is well known that I strongly believe we need a fundamental change in the relationship as far as the United Kingdom is concerned because otherwise we will be greatly disadvantaged. I will go into the reasons for that shortly. The population in the United Kingdom is getting on towards 70 million, which puts us in a very different category from many other EC countries, other than countries such as Germany and France.

As far as I am concerned the heart of the issue is the question of democratic accountability and, as has been a constant theme of COSAC for a number of years, of which both your Chairman and I are members, also a question of democratic legitimacy. The issue of the national parliaments in relation to the EU institutions, which we debated yesterday in the House of Common and which they are debating again today, is a critical factor because the obligations of member states to accept and comply with EU obligations is an evolving and ever integrating process, compounded by the majority voting system in the Council of Ministers, particularly as reformed since 1 November 2014. By virtue of this reform Germany and France with two smaller states have a blocking minority and so forth. There is the over-riding question of the role of the European Court of Justice.

In 2014, after taking extensive evidence, my committee, an all-party committee, unanimously went so far, rightly in my opinion, having regard to the nature of the impact that the European Union is having on our democratic system, as to propose that we should be able unilaterally to repeal legislation where it was necessary to our national interest and also to veto issues in the pipeline, both of which were implicit in the original entry to the EC. The European Communities Act 1972 was a voluntary enactment by the United Kingdom Parliament in respect of which I would simply make one point, which is that the United Kingdom is the only member state which does not have a written constitution and therefore from that point of view we are in a different position from some others. Our engagement in the European Union is therefore voluntary, as Lord Bridge made clear in the famous definitive case of Factortame some years ago.

I do not believe it is possible to have two governments and two parliaments covering the same issues because of the inconsistency and the contradictions that emerge and the tensions generated simply mean that the European Union, as I believe has become evident, simply cannot work on the current footing. There is a democratic inconsistency between decisions which are taken by voters in general elections and ongoing decisions which are taken under the general rubric of the treaties themselves, and actual decisions that are taken by the Council of Ministers, often without a vote as such and done by consensus. What the electors subsequently discover has been proposed and-or implemented, through the European institutions, for example by virtue of regulations, over which they have little control or say, short of a referendum.

To this I would add the way in which COREPER functions and I would refer the committee, if it has not heard of it or come across it, to VoteWatch, a very distinguished body, headed up by Professor Simon Hix, which illustrates the fact that of the order of 90% of all European Commission proposals go through. There may be some adjustments and there may be one or two things that get lost but basically it is around 90%. That, I think, indicates the sheer tsunami of legislation that is coming through and raises serious questions in my judgment about the degree of democratic accountability. It is also, perhaps, worth noting that The Observer newspaper on 22 February, in relation to the question of a referendum, indicated in an opinion poll that 51% would leave. I would go further and say from the evidence I have from a series of polls over many years that if a new relationship was negotiated on the basis of the United Kingdom returning to a structural change in the architecture of the Union as trade and political co-operation with the democratic sovereignty fundamentally being in Westminster that the figure would go up to around 70%, which is pretty significant.

The European Union, in my judgment, is in a state of democratic and economic crisis and there seems to be no appetite for examining the reasons this is so, particularly in terms of the need for structural change in the architecture of the European Union to return ultimate decision making, while insisting on trade and co-operation, back to those who are elected in general elections to their national parliaments. There is much talk of subsidiarity but little or none in practice. I would add that President Barroso, at the time when he was President of the Commission, stated that the European Parliament - and only the European Parliament - is the parliament for the European Union. That does not bode very well for the national parliaments. That was post Lisbon, when we were supposed to have further and additional powers. We discussed much of this in COSAC.

There is also the problem of the over domination of one country - Germany - over the economic and political position of the European Union, not only within the eurozone but by consequence also within the EU as a whole. What was referred to earlier about the question of Greece and the very dramatic crisis which emerged yesterday is a very good indication of that degree of disorder. I would also like, subject to the committee's views, to remind ourselves that there was substantial pressure - some would even say bullying - which took place at the moment when Ireland was in crisis a few years ago. If I am right in what I can recall, the troika arrived in Dublin without even so much as the formal consent of the Irish Government, let alone the Irish Parliament. The attitude of the troika was graphically described by Deputy Eric Byrne just now and I think the Chairman referred to it indirectly in terms of the situation which is currently under discussion among the Finance Ministers. This is yet another indication of the attitude, as I said to the Prime Minister in the House of Commons last week. I challenged him on the language that Wolfgang Schäuble has been using.

It is very unhelpful when one is talking in terms of crises within individual countries which are under intense pressure. We need to be very realistic about what is going on. The late Brian Lenihan was under very considerable pressure at that time. Members will know more about that than I do, but I was watching it pretty closely and I got a very nasty feeling that there was something going on which was both pressurising and very unhelpful to resolving the difficulties Ireland faced.

I believe there was at one stage a rule of no bailouts. We can park that one because we now know the whole European Union functions on bailouts. In fact, it goes even further than that; it actually prints the money to pay for the bailouts on a scale which is simply unbelievable. However, that is an economic argument into which I will not go but I am very worried about it because one earns money by taxing proper enterprise and not just by printing it in the printing presses.

The EU is not merely sleepwalking but is accelerating into disorder which is reflected in what I said I thought would happen when I wrote a book in 1990 called Against a Federal Europe- The Battle for Britain. I hope I do not sound presumptuous when I say that in that book, I said the European Union and European government - this led me to lead the rebellion against Maastricht treaty all those years ago - would be accompanied sooner or later by the internal contradictions of all the kinds I have described and the economic pressures creating a problem of protests, riots, massive unemployment and the rise of extremism. There are not many people who would seriously dispute that has actually happened as well as the lack of jobs for young people. If one looks at Podemos and Syriza and at where the pressure is coming from and asks where all this is leading, I would have said there is a very strong case for everybody to take a step back, to have a really good look at the landscape without prejudice to the existing treaties and to ask what all this is for and if we want to have peace and security, which were what the original intentions of the European Community, now the European Union, were meant to be.

Although many people have received huge sums of money and they have a defence commitment that goes with Article 5, because of the interconnection, none the less the intrinsic internal implosion, which is now virtually unstoppable, is the moment when we should pause to ask what kind of European Union we want, not to mention the imbalance in terms of trade between Germany and most of the other member states. As far as the United Kingdom is concerned, we run a deficit with the other 27 member states of more than €50 billion per year while Germany runs a surplus with the same 27 member states of more than €50 billion year. We would regard that as pretty indicative of the state of play for the United Kingdom. We have a surplus selling the same goods and services to the rest of the world because we have these enormous opportunities in regard to the Anglo sphere, with our commercial ties, the language advantage we have and so forth .

We are confronted by a political union which is being presented more forcefully by Angela Merkel, as Chancellor Kohl did before her. This is not a new issue. National parliaments are being dumbed down and the element of trust is gone. More than 60% in many countries in Europe have lost trust, according to the euro barometer poll. The turnout in the European Parliament elections was barely 43% and that 43% only held up because quite a lot of older people voted. The level of turnout among younger people in the European elections was derisory. We are confronted by an unbalanced Union, which we see in regard to Greece, for example, but potentially other member states, such as Spain.

Furthermore, it is clear that subject to a referendum in the United Kingdom, the issue of Britain's role outside the eurozone, because we are certainly not going back in, and therefore being confined to the second tier of a two-tier European Union, is that the UK has a permanently decreasing role of influence. I believe this cannot be remedied by the mantra that the UK has influence merely by being at a table, where the influence is diminished by the voting system and institutional arrangements defined by the acquis, not to mention the role of the Court of Justice which, under sections 2 and 3 of our European Communities Act 1972, overrides our Supreme Court and our Parliament. This acquis, which can only be changed by unanimity and treaty change, is a real problem. None of the answers to the problem is remotely on offer from the other member states. Everybody is locked into the belief that one cannot change any of this. Personally, I believe this is political suicide. The European Union is creating a very serious problem for itself.

Hence the growing case for exit by the UK, bearing in mind that we have these external Anglosphere opportunities and a very substantial surplus with the rest of the world. In any event, we would continue to be in a mutual trading relationship and political co-operation with the other member states, even if we were outside the EU. I strongly believe it would not be in German interests, for example, if it were to knock out the approximately €20 billion worth of cars and trucks that come into the UK, nor would Germany contemplate allowing it to happen. At the same time, the EU as a whole is becoming less competitive in the big league table. Then there is also the problem for us of the City of London, where we have lost five or six of the last seven court challenges. In respect of over-regulation for business in general, as I am sure Ireland is discovering as well, even according to Peter Mandelson, when he was the Trade Commissioner over-regulation was costing the European Union 4% of GDP. It is not a good story.

Many member states have made it clear that they wish the United Kingdom to remain in the EU. I had a one-to-one meeting with the Norwegian Foreign Minister a week ago and he said that too. However, this ultimately must be decided by the UK, and this must be through a referendum in the relatively near future. The UK will hold the EU Presidency in 2017 and I do not believe it is practical to have a referendum then. We must have it soon and I hope it will be in 2016.

This is the ultimate test. If there is a paramount need in individual member states that the UK remain part of a European relationship, and I refer to Ireland in this context but other countries share that view, in light of our contribution to European matters over the last 100 years and more and also the fact, if I can put it in simple terms, that we saved Europe twice from tyranny, and with Irish help in the trenches, the issue must be decided by us. If the UK remaining part of a European relationship is to be sustained and if this is so overwhelming an interest for the other member states, then in the national interests of other member states and in the European interest as a whole, bearing in mind our historic role, does this not lead to an essential question of restructuring the EU for this purpose? If we are so integral, and if everybody says we must stay in, is there not a point where action becomes part of the dialogue to ensure that we get what is needed to preserve the integrity of Westminster as a national parliament? In my view, this is not special pleading. It is based on fundamental principles of democracy, freedom and common interests, which we all share. The stakes are very high, but the principles of democracy are not negotiable and are fundamental in our national interest, and the preservation of our national parliament lies at the centre of this concern.