Getting Europe back to work

Minister for Europe, David Lidington's first overseas speech since appointment. Delivered in Stockholm on the 7 June.

This was published under the 2010 to 2015 Conservative and Liberal Democrat coalition government
The Rt Hon David Lidington CBE

God Kvall

This is my first speech overseas as Europe Minister; and I am delighted to be giving it in Sweden, a country, I’ve been told on good authority, who votes most similarly to the UK at Council. Of course, we don’t measure our relationship in council votes - but it does give an objective account of how like minded we are on many issues and our shared vision on the future direction of Europe.

There are few closer partnerships existing in Europe today.

There are already exists a long friendship between the leaders of both our governments. We share the same desire to see that ambitious words and sentiments are translated into decisive and effective action. We are both countries strongly attached to free trade - and share a deep national conviction that the dignity of the individual, respect for human rights and economic freedom are essential foundations for a free and economically prosperous and stable world.

I am sure you will know how much this Government’s thinking owes to the innovative policy successes pioneered by Swedish governments in the past two decades - on free schools, on transparency in government, on improving our families quality of life and on best practice in international development. The new British Government is very keen for this rich and fertile exchange of ideas to continue.

We are clear that we do want to bring a fresh approach to Britain’s involvement in the EU. The Prime Minister has said that the government leads would be active and activist, positive and energetic in our relationships with Europe and our European partners whilst standing up for our national interests. And now we are in a position to show that we meant every word we said.

Yes, this Government will be in robust in advancing British interests abroad, just as our European partners do theirs.

We are also a Government which strongly believes that the European Union has a crucial role in enabling the countries of Europe to work effectively together to tackle the greatest challenges of the twenty first century whether it is the scourge of global poverty or the threat of terrorism we know that the European Union gets better results if it works together.

Indeed, for the past two weeks the Foreign Secretary and my ministerial colleagues have been busy meeting with many of our European counterparts, discussing some of the serious issues that face us all in the execution of our foreign policy.

The Foreign Secretary has argued that the UK’s ability to undertake economic modernisation will be critical to Britain’s future influence. When skilled people are able to chose more readily where they want to work or locate themselves when capital, labour and technology are increasingly mobile no country can stand still. We must adapt to take advantage of new opportunities. That is an indisputable case for national economic reform. It is also an argument that is equally applicable to the European Union.

Because this is a pivotal moment for the EU. There is a distinct choice to be made between wilfully ignoring the current structural constraints that limit our ambition in pursuing an economically viable and prosperous future or recognising and addressing them for the benefit of all our peoples.

Neither Britain nor Sweden joined the Euro but for both of us the Eurozone is our single biggest trading partner. As such, problems in one Member State affect us all, whether we are single currency members or not. Recent developments in the Eurozone have demonstrated the need for fiscal consolidation.

The new Coalition government in the UK was unfortunate in inheriting the largest deficit of any EU member. One of our first actions was to announce £6 billion of savings from the public purse to help restore discipline to our finances. On 22 June the Government will announce an emergency budget which will implement further fiscal consolidation. This will be supported by a comprehensive spending review in the Autumn. And the Government has established an Office for Budgetary Responsibility. For the first time we will have independently audited and transparent figures on growth and debt. And for the success of the European Union it is essential that, where appropriate, our Eurozone partners act just as swiftly and decisively.

The current economic situation within the Eurozone has demonstrated the urgent need for reform across the EU. It is no secret that a number of EU Member States face severe difficulties: our collective European debt is €8.69 trillion and average unemployment across the 27 Member States is 9.7% rising to 10.1% in the Eurozone. In Southern Europe the figures are even higher. More troubling is the fact that unemployment amongst school-leavers is higher than ever. Young people leaving education are finding it impossible to find their first job or career. We need to pursue, quickly and with equal vigour, deficit reduction and a new strategy for growth and jobs.

Because it is singularly clear that for EU nations to thrive, in an era of increasing globalisation, they must deliver improvements to the quality of life for all EU citizens. The EU’s success in doing that depends above all on how well it is able to deliver a better economic future.

We know that when Europe works well it delivers tangible economic benefits to European citizens. It is the world’s largest multi-lateral trading bloc with a market of around 500 million people. That is a bigger trading area than the US and Japan combined. Membership of this market brings opportunities for business and consumers alike. European companies invest across all of Europe, employing citizens of Member States and raising standards of living.

Without an economically stable and prosperous European Union we will not be able to successfully address the problems of climate change or tackle the scourge of global poverty. So it is vital that the EU has an effective strategy to tackle the current economic crisis, promote growth and job creation, and redress the steady erosion of competitiveness.

So the question for all of us in the European Union is “where is the growth we need going to come from”?

And the answer lies in a reform based recovery: through a single market, green jobs, structural and economic reform, and a free and open market.

It is clear the Lisbon Strategy did not achieve its very ambitious objectives. The strategy was well meaning in its intentions but the economic crisis exposed serious weaknesses in its implementation. And we - Europe - cannot afford to repeat those mistakes.

This is why the EU 2020 must match the realities on the ground and deliver on key areas critical for sustainable growth and jobs in Europe. Quite rightly the intentions of this strategy are to drive growth and promote jobs; but the UK Government will want to ensure that the strategy fully respects the balance of competence between Member States and Community action.

Individual Member States and the European Union must seize this opportunity to reform, adapt and emerge from its current economic situation more competitive and more alert to the new global economic context. We must all recognise that for Europe to be in a position to take advantage of new economic motors which are currently driving global growth - Brazil, India, China, Indonesia, Turkey, South Africa - then we must look outwards and build on its position as a global trading hub.

This is why the UK Government will be enthusiastic champions of the Single Market. Better regulation can lighten the burdens on business and create freer and fairer trade between the EU and third countries. Well functioning markets within and outside the EU provide effective competition essential for long term productivity and the route out of the current economic climate.

By actively creating an environment in which entrepreneurship and creativity can flourish the EU can regain its competitive edge. Opening up energy, digital and service sectors and guarding against protectionism will help unleash competitiveness and growth.

And I will make no apologies for advocating that the EU should use its power as a key trading partner and leader on climate change to further both our trade and climate change goals by making it easer to trade low carbon goods.

There is a strong economic case for Europe to regain leadership on the climate change agenda and promoting a ‘green single market’ in goods and services.

By encouraging innovation and promoting action we can make a strong case to show that a transition to a low carbon economy can create jobs, support growth and reduce carbon emissions.

And part of the commitment to a renewed and reinvigorated Europe must be an EU budget adapted to the needs of Europe today and the challenges of future growth. To deliver sustainable economic growth we are all going to have to take a long hard look at ourselves and ask whether the financial decisions that we take in Brussels add value, aid our economic recovery and help secure future prosperity.

But it is not just the UK who is suffering debt and economic problems. Like the UK, many of our European friends are showing great courage by acting decisively in the face of adversity and pushing forward tough austerity measures in the face of some opposition. Sweden of course has already gone through this process, implementing tough austerity measures and structural reforms in the early 1990s.

But it makes no sense for individual European Member States to be taking difficult but necessary fiscal decisions if the same level of responsibility and realism is not reflected at the European Union level.

The EU budget is not immune. European institutional budgets must swallow the same medicine as the rest of us. The EU must live within its means. European leaders and officials will have to take tough decisions that benefit everybody. Without reform of the budget the European Union will have wilfully limited what it can achieve for itself and its citizens.

A re-orientated budget can further promote the jobs and growth that European citizens demand and - should - expect.

This Government simply doesn’t accept that Europe is impotent in the face of its projected decline against the emerging markets. Emerging economic markets will help drive global growth which Europe must see as an opportunity. If the European Union embraced budget reform it would equip itself to maximise those opportunities; to ensure Europe’s global competitiveness; and to enable its members to take full advantage of new global realities creating the best possible future for themselves.

Achieving the necessary changes will require a strong partnership and creative ideas. That is why I wanted to visit Sweden first and why I am so delighted to have had such excellent talks today with, among others Birgitta Ohlsson and Mikolaj Dowgielewicz. It is clear that we share a similar perspective on many of these issues. This Government knows, as we have always known, that by working with close partners like Sweden we will be able to deliver the far reaching, effective and necessary reforms vital for the interests of both our nations and the EU as a whole.

Tack sa mycket

Updates to this page

Published 7 June 2010