agreed. Furthermore, the Act provides that an Act of Parliament will be required for all types of EU treaty change, including agreement to the use of ratchet clauses in the Lisbon Treaty which allow the powers of the EU to expand in the future without a new treaty. Any ratchet clauses which would transfer powers or areas of policy from the UK to the EU would also be subject to the British people’s consent in a referendum (

European Union Act 2011

). ·

Ensuring the sovereignty of Parliament.

The EU Act also includes a sovereignty clause which ensures that ultimate authority remains with the British Parliament by underlining the principle that EU law only has effect in the UK through UK Acts of Parliament and not through any independent authority (

European Union Act 2011

). ·

Ending UK participation in EU Bailouts.

We have secured a commitment that the £50 billion European Financial Stability Mechanism (EFSM), which provides loans to EU member states in financial difficulties, will come to an end in 2013. Alistair Darling signed the UK up to the EFSM in May 2010 before this Government took office, meaning that the UK has been liable to bailout EU countries through its share in the EU Budget. The Chancellor, George Osborne, specifically objected to Alistair Darling’s decision and now, thanks to tough negotiation, our participation will end in 2013 (

Hansard

, 28 March 2011, Col. 35).

·

Keeping the EU Budget under control.

We will strongly defend the UK’s national interests in the forthcoming EU budget negotiations. The EU budget should only focus on those areas where the EU can add value.

o

Annual increase halved in the EU 2011 Budget.

We have no veto over yearly budgets, however this Government succeeded in winning agreement from enough other EU Governments to cut the annual increase in the 2011 EU Budget to half that agreed by Labour in the 2010 Budget (

BBC News

, 29 October 2010).

o

A real terms freeze in the EU 2014 – 2020 Budget.

Thanks to this Government’s leadership, Britain, France, Germany, the Netherlands and Finland have already signed up in public to a keep the next EU multi-annual budget to a real terms freeze (

Letter from EU leaders to the European Commission

, 18 December 2010).

·

Using the EU to further Britain’s national interest.

The Government active and energetic engagement is delivering concrete results in the EU that are in the UK’s national interest:

o

Sanction on Iran.

We have secured agreement on tough, targeted EU sanctions on Iran (

BBC News

, 26 July 2010).

o

Sanctions on Syria.

We have argued for and achieved tough EU sanctions on Syrian oil exports to the EU and on regime officials (

BBC News

, 19 August 2011).

o

Trade with South Korea and Pakistan.

On 6 October 2010 we secured agreement by EU Governments on a Free Trade Agreement between the EU and South Korea, worth £500 million a year to the UK (

BIS Press R elease

, 6 October 2010). The EU has also agreed to liberalise trade with Pakistan (

BBC News

, 16 December 2010).

o

Jobs and Growth.

On the 18 March 2011 David Cameron and leaders from eight EU countries wrote to President Van Rompuy and President Barroso calling for a new direction of economic policy. The UK subsequently published its proposals to improve EU economic competitiveness. Much of this was agreed by the EU Council (HM Government,

Let’s Choose Growth

, 31 March 2011). The Government has also defended the UK financial industry by delivering a deal giving hedge funds access to all markets across the EU’s 27 member states in return for signing up to common rules set by the new European Securities and Markets Authority, which regulates the EU’s financial system (

BBC News Online