15/04/2016 Politics Europe

But first it is Politics Europe.

Hello, and welcome to Politics Europe, your regular guide to the

top stories in Brussels and Strasbourg.

On today's programme: The Panama Papers laid bare

the secretive world of tax havens.

Can an EU deal on tax transparency crack down on evasion and avoidance?

A new deal to share information about airline passengers between EU

member states.

But is it an important measure to improve security, or an

infringement of citizens' privacy?

Malta's links with Britain stretch back centuries.

So what do expats there think about the prospect

of the UK leaving the EU?

And we take a look at the city-state that is home to some

of the EU's biggest institutions.

So all that to come, and more, in the next half-hour.

First, though, this week members of the European Parliament have

been meeting at Strasbourg for their regular plenary session.

So what have they been getting up to, and what else has been

happening over in Brussels?

Here is our guide to the latest from Europe in just 60 seconds.

Responding to the Panama Papers revelations, the EU announced

bumped-up measures on tax avoidance.

They want to leave big businesses with nowhere to hide,

forcing them to declare how much corporation tax they pay outside

the EU, including in tax havens.

The migrant crisis goes on, with Italian coastguards rescuing

4,000 migrants in just two days.

And Austria's strengthening of its border controls caused

tension between bureaucrats and member states.

This as EU officials, including Council President Donald

Tusk, appeared in front of MEPs on Wednesday to defend

the controversial deal to return migrants to Turkey.

Protestors in Paris spent a second week sleeping out in the Place de la

Republique, expressing anger over their government's labour reforms.

But Paris wasn't the only place that tempers flared.

British MEP Syed Kamall perhaps didn't mean to be caught making this

rather rude hand gesture during a European Parliament session.

And with us for the next 30 minutes, I'm joined by two MEPs,

the Conservative Timothy Kirkhope and Ukip's Gerard Batten.

Welcome to the programme to both of you.

Hello, Andrew.

Let's look at one of these stories in more detail,

that is the EU's efforts to crack down on tax avoidance and evasion.

And Timothy Kirkhope, as I understand, they are now saying big

corporations should include details of the finances that they have

parked or operating in tax havens if they want to trade with the EU.

Is that the right thing to do?

I think it is.

I think it's right that we should have far more transparency now.

I think there's an understanding that they have real concerns over

these - these tax havens, wherever they might be, and I'm very

encouraged by not only the attitude we are taking in Europe, but also

the attitude taken by Chancellor George Osborne with

his colleagues, in the meeting he is having this week at the IMF.

Is the EU sure that it doesn't have, or has done enough

about the tax havens in its midst?

I think of Luxembourg, or even, some people say, Ireland?

I think it's made a lot of progress on that, actually.

I mean, one of the problems we have, of course, as Conservatives there,

is we don't want to see tax harmonisation as coming in

on the back of this crackdown.

We need to separate the two, and that's one of the reasons why we

sometimes have difficulty with some of the things that are put forward,

the proposals from the Commission in the European Parliament.

What is your view on this?

Well, we wouldn't have any objection to an international

system where countries actually get together to do this kind of thing.

Most of the tax havens are being...

Are moving outside the EU now, from Liechtenstein and Switzerland,

because the EU has started to clamp down on them.

The danger is that if you don't have an international system,

they just move out and do their business elsewhere anyway, and you

don't get any taxation from them.

But in some of the advances that have been made, that have gone

global, which the OECD has done, in that area, a lot of them

originally started in the EU.

As in, the EU played a role in beginning what we might call

best practice, or doing things which we know can't be resolved,

even at a European level alone, but it started the ball rolling.

Well, I think the EU is not supposed to be concerned with tax.

It's supposed to be one of the red lines that we're not

going to cross, to allow itself to be involved in taxation,

but that line has already been crossed with this type of thing.

When the EU does anything, it's all about

its long-term ambitions to create more power for itself.

So I think while it may initially seem like a good thing, you have to

look at the EU's longer-term plans.

The EU shouldn't help to make sure that

the member states are able to gather the tax revenues that is their due?

Well, I think that's again - that's something that should be done on

an international level, because if the USA's out of it and China's out

of it, and Russia's out of it, then of course you're only going to have

a partial solution to the problem.

Yeah, but I mean, look, working together with

our colleagues in Europe is going to be very fruitful on this.

I think it really shows a good example to the world, and the fact

that we've got five nations, as I say, now agreed on taking much

stronger steps to avoid this tax evasion...

You accept if others don't join in, though, it will be very...

It won't be as groundbreaking as the Chancellor is trying to make out.

Not as ideal, but of course, as you say, the EU is

a very good starting point here.

It's a very good example of working together to achieve.

One of the ways to avoid aggressive tax avoidance is to actually have

less taxation, have a flat tax system where it is much simpler

and easier for people to understand, and then I think people will be

more willing to pay the tax.

Very well.

Now, MEPs voted this week to set up a joint system for police

and justice officials to access airline passenger data covering all

flights to and from the EU.

So how would it work?

Passenger name record data includes names, contact details, itinerary,

the credit card used for payment, and baggage information,

along with passport details.

It will not include a person's race or ethnic origin, religion,

political opinion, trade union membership, health, or sexuality.

This data is routinely collected by the airlines, but the EU is planning

to set up passenger information units in each EU member state to

collect the information instead.

The units will be able to keep this data for up to five years, and they

can pass the data on to law enforcement officials only in cases

of terrorism or serious crime.

Now, this already happens in the UK.

Critics are concerned over privacy and the length of time, five years,

that the data can be stored.

But supporters argue that it is important to have a common high

standard, and that this is less information than you would be giving

in your airline loyalty card.

Now, I fly a lot to the United States, and I'm always aware

that you have to give all this advance passenger information, and I

know that goes to the US border force equivalent, and if there was

something dodgy, that would stop me going to the United States before I

even got on the plane.

I think a lot of people would be surprised that

that doesn't happen in Europe.

Well, I've been working - it's my report, this.

And I have been working on it for five years now, and having to deal

with quite a lot of opposition, mostly

based on the fact that individual data and privacy is something which

obviously we're concerned about, but some groups believe that

takes priority over security.

We have an agreement with the United States, about three years ago

we entered into that agreement.

"We" being the EU.

Yes, the EU, of course.

Because that is the only way in which you can operate.

Because the Americans wouldn't let you fly otherwise, would they?

That's absolutely correct.

And international crime is international.

Terrorism doesn't respect borders at all.

But of course, patterns of activity, which is what these proposals are

designed to deal with, patterns of activity are enormously important

for our intelligence agencies and police, and I'm absolutely

delighted, delighted that we got the vote this

week to get this thing approved.

Parliament finally approved it.

There has been resistance in the Parliament.

Well, as I said, five years, it is taken ten years of my

life. And it is important, this is not a silver bullet.

But this is a very important tool to give us

greater security when we travel, and not only when we travel, but

when we are actually on the ground.

What's your view on this?

Quite a large section of the Parliament voted against it,

there are about 179 MEPs yesterday voted against it.

30%.

Almost a third voted against it.

Including yourself.

Did you vote against it?

Absolutely, I did indeed.

Why was that?

Because we have a passenger name recognition system

in the UK, which we share with other people, and other countries have

systems which they share.

But this gives an enormous amount of personal information, which on the

basis of common recognition, which means we accept all EU countries are

on an equal level, we are going to give access to that information to

institutionally corrupt countries like Romania and Bulgaria, and we

don't feel that that is a good idea.

What are they going to do with it?

Well, who knows what they can do with it?

We know that even in our own country, Andrew,

that Government-held information on citizens often goes amiss.

Yes, it's true.

They can lose it, but how do they misuse that?

Well, it could be misused for criminal purposes,

if someone can gain access to that.

Just one other thing...

Let him answer that, and then I will come back.

I just want to deal with this, because this is quite ridiculous.

I do wonder why...

I think it's because the term EU is in the title,

that's why you automatically seem to vote against these things.

But this is an international situation which we have very tight

safeguards, quality standards, a lot of them based on the British system,

which has been in existence.

But instead of these ridiculous, slow-moving bilaterals to get

information about suspicious people travelling, from now on, under these

very strict rules and controls, we are going to be able to move

information fast, as fast as terrorists can move,

and faster than criminals can move.

That's the key.

We really have to do it together.

What was the other point you wanted to make?

Well, terrorists have moved on now, and they realised they can be

tracked in this way.

And so therefore we've seen in the Paris attacks

and the Brussels attacks that they do things in a different way.

The biggest problem to security is the Schengen open-borders,

and the fact that people can move across Europe freely,

and they can get into Europe on forged papers, for example, and...

But that's not a reason, surely, for not doing what is being proposed, is

it?

I mean, it's perfectly true that if you close one area then it can

open other areas, but it is not a reason for not doing it.

It seems to have worked pretty well on the transatlantic side of things,

between the EU and America.

Should we not...

If we are better protected that way as we cross the Atlantic, should we

not have the equivalent safeguards if I fly, say, from Nice to Berlin?

Well, again, we do this, and we do it with countries we can trust

and we share that information.

We cannot trust all the countries in the EU.

Can I give you a point that illustrates this about

this common recognition fallacy?

We have a European arrest warrant where anybody can shipped

off to any other country on the strength of a piece of paper.

The European Court of Human Rights, I think it was,

has just recently issued a judgement that says we now can't send people

back - foreigners, British citizens, to serve their sentence in their own

country, because of human rights.

But you see, this common recognition thing, we are not all of the same

level.

Is it necessary for the authorities to keep the data for five years?

Well, it is anonymised after six months, I think a lot of people

haven't caught on that, because then it becomes statistically

important but not specifically.

Can you still see a trend then, if it's anonymised?

You can still see a trend.

What's the point of anonymising it?

Well, I think the intelligence agencies are looking at patterns

and developing patterns.

This is the key to intelligence, actually.

So you would still know I had made a trip,

but you wouldn't know it was me?

You knew the trips had been using certain routes.

You had mentioned going straight to a European city from outside.

What of course people are doing, and will continue to do,

is to do indirect sets of travels, maybe from Istanbul to Stockholm,

to Madrid, to Berlin, maybe to attack Paris or London.

And I think that our own PNR system, as Gerard said, has been very

successful but it is having to rely on bilaterals, occasionally.

It's not good enough to try and deal with

the modern threats that we have.

When does it come in?

It's coming in very quickly, within two years.

But in fact, I'm hoping that we will be operating

a lot of it within months.

All right.

Now, David Cameron called a once-in-a-generation decision.

Should we stay in the European Union?

Will we still have access to the single market?

If we leave, would we be able to curb migration?

But perhaps some of those people most affected by the

decision are the 2 million Brits living on the rest of the European

Union, many of whom won't be able to vote in the upcoming referendum.

Our Adam has been to Malta to meet some of them.

The Maltese are celebrating the UK leaving.

It's the Freedom Day bank holiday, which commemorates the moment

in 1979 when British troops left these islands.

But the truth is, the Brits never really left.

There are still 12,000 of them living here.

Come with me to meet some of them.

Like Amanda, who is an executive coach.

She thinks the European Union makes sense for trade, but she worked on

an EU project that did not seem like value for money,

leaving her conflicted.

I've benefited from living and working across the EU.

I like to travel across the EU.

And then I'm thinking, as humans, we like the status quo.

We kind of tend towards that.

So I do need to just check that what I'm taking for granted,

and the assumptions I'm making, do actually make sense.

Some longer term residents, like Peter, can't vote because they have

lived abroad for more than 15 years.

I'm actually quite annoyed about it.

I would like to have some say.

I'm still paying my taxes in the UK, and I've always paid them there, so

I think perhaps I should have a vote no matter how long I've been away.

Among other retirees, the arguments sound just like the ones

you'd hear in the pub back home.

I don't really know what I want to know about it.

I feel the politicians, the ones that want to come out,

are telling you the scaremongering about staying in, and the ones that

want to stay in are giving you the scaremongering about coming out.

So you're only getting the bad points and not the good points.

My gut reaction is better the devil you know, stay in.

We like to obey the laws, but sometimes a lot

of the things which are coming out, they seem to be making things up

as they go along sometimes.

You say the UK should make its own laws, you have left the UK.

Yes, I know, but I go back very often and I'm very loyal.

By the way, I am a royalist.

There are a few exclusively expat worries, though.

I had a look on the internet, and one

of the things is they were talking about the retirement pension.

They might have to freeze that.

You'll get your pension but they might not give you any

of the increases over the years, like we do in England.

It is just the pension, that is all I'm worried about.

On Freedom Day, the Maltese Prime Minister visits this memorial.

He has tried to be reassuring.

He says British people's healthcare in Malta is covered

by an agreement signed by the two countries before either was in the

EU, and the tax system is generous to people with a foreign pension.

And at this swish law firm housed in an old palace,

they are not getting calls from worried Brits in Malta, instead

it is worried Brits in Britain.

These are generally people, whether British or otherwise, living in

London, which for them is possibly the European capital of financial

services, who previously relied on London being not only London, but

also part of the European Union, and will now need to look

for another central European city which is friendly to financial

services, but offers the same kind of general pro-business environment

for doing business.

Of course Malta offers more than that - even in the mild climate,

the sun and the sea and the Mediterranean way of life.

Malta has obvious links with the UK, making people here seem pretty

relaxed about the referendum, and globally just 106,000 expats are

on the electoral roll, which suggests postal votes won't have

a massive impact on the result.

Should British expats who are living in the EU and still British citizens

have a vote in this referendum?

I would like them to have the vote.

But they won't?

I don't think so.

I don't think they will change the voting system specifically for

this, but I think it would have been a good idea for them to have a say.

They are a component, living in Europe, and they are British.

Should they?

I think the cut-off was 15 years.

I wouldn't have too much trouble with people...

If you have been away for 15 years, then you lose the right to vote?

There has to be a cut-off point, and I think that is a fair one.

But I would not particularly have an objection to them voting if they

have recently left the country.

For the kind of expats we saw in Malta, many more obviously in

Spain, France, if we were to leave, are they not right to be worried

about their residency status, access to healthcare and so on?

There have always been British people living abroad

in different countries.

There are more than 2.5 times the amount of Europeans living

in our country as there are British people living in the EU.

They will continue to have their property rights protected

under the European Universal Declaration of Human Rights.

People can't just throw them out of the country because they are

annoyed at Britain leaving the EU, and we will not do anything to the

Europeans living in our country.

And as for health services, we have reciprocal arrangements

already, we had them before...

You think they will continue?

There is no reason why it shouldn't.

You always say the same thing, Gerard.

"There is no reason why there should be," - there is actually quite a lot

of reasoning why it would not be.

If we are not part of the EU, we are essentially at the mercy

of the different states.

Malta may have a positive attitude because

of its history and background linked to Britain and so on, but a lot

of other countries do not.

And won't.

I think therefore it is a rash thing to tell the public that it should be

On the health issue, a lot of European countries don't

have equivalent health services.

If you live somewhere like Greece, you either have to pay or have

health insurance anyway.

In terms of reciprocal arrangements we've got, Britain actually pays far

more out to the European Union than we get back in terms of this.

Recent figures show we spent about ?683 million to the EU,

while we got ?50 million back.

These are published figures.

So you say nothing will change.

You think there is a danger?

I think there is a massive danger.

It is not scaremongering, it is just a reality.

We'll hear a lot more of this.

It is one of the EU's smallest countries, but its

size perhaps belies its influence.

It is the home of the European Court of Justice, and its former

Prime Minister, Jean-Claude Juncker, is now president of the

European Commission.

Adam has been to meet the neighbours in Luxembourg.

A morning at the stables, except it's actually the airport.

Luxembourg's freight-only airline, the biggest of its kind in Europe,

specialises in exporting expensive horses, around 3000 a year

at thousands of euros each.

Welcome to horse business class.

They travel in this specially designed container, three stalls,

one for each horse.

Wood shavings on the ground so it feels like stables back home.

And a door so the groom can check on the animals during the flight.

There is a groom on hand with food, water and a vet at each end

of the flight.

We have a stop in Prestwick.

We have a stop in LA, then in Seattle, then

the final destination is Calgary.

When will they arrive in Canada?

I think tomorrow in the afternoon.

So it's a long flight.

Yes, it is a long flight.

It is not just horses.

They have flown a pack of huskies, a giraffe, and even a whale.

All of this is very Luxembourg, in other words,

looking after assets for fairly wealthy people who live elsewhere.

A tradition that has made this tiny country very big news.

Two years ago, a cache of leaked documents showed hundreds

of multinational companies enjoyed minuscule tax rates here, a scandal

that came to be known as Lux Leaks.

I went to a little town to meet the Mayor, who is also the general

secretary of the Christian Social People's Party, which has provided

most of Luxembourg's leaders since the Second World War.

Are you worried Luxembourg sometimes looks like the Panama of Europe?

I hope people won't see us as the Panama of Europe, because we

are not the Panama of Europe.

Of course the Lux Leaks put us into a light which is not quite

right, but a lot of things changed, and I think when we compare us to

the city of London, we don't have to be ashamed of ourselves.

Ouch.

He is also pals with the former Prime Minister, Jean-Claude Juncker,

who is now president of the European Commission.

What do you on a night with the Junckers?

It is like a machine.

You find it a lot in pubs, and you have...

You have the pinball going around.

Jean-Claude Juncker is a fan of pinball machines.

Yes, that's right.

He's got one at his house and he likes to play with it.

And as for our four-legged friends, they are ready

for takeoff to Canada.

I hope they pay attention to the safety demonstration.

Many of the companies that we are criticising not paying enough tax

in Britain, such as Google and Amazon, and not doing so because

they are based in Luxembourg.

Many of these arrangements were put in place when Jean-Claude Juncker

was Prime Minister.

Are we not right to be suspicious?

I think it is a natural inclination of the British to be suspicious.

It's not fair either.

I think they are cleaning up their act a lot.

The whole way in which these things are moving does

not favour anybody just because it happens to be a place

where Jean-Claude Juncker lives.

The man who put a lot of this in place is now the man supposed to

be cleaning it up.

A slight irony, perhaps.

Irony?

What do you say?

We were very amused in the European Parliament when this

subject came up, and of course Mr Juncker presided over all of this.

Now he is telling the rest of Europe to clean up their act.

Of course Luxembourg is the kind of HQ of the European Union,

the second HQ apart from Brussels, and about the biggest beneficiary

per capita of the EU budget.

They get a lot of money out of it.

There is a third Parliament there which is

mothballed, but we still pay millions every year for the upkeep.

A lot of people have nostalgia for Luxembourg.

A lovely programme on Radio Luxembourg.

What does that have to do with companies not paying tax?

It's the genuine fatcat HQ.

It is, and it is still a place where taxes are very low.

Yes, that's true.

It is an unusual country.

Companies will go there until something is done.

We are in favour of having a competitive tax system

in Europe, and hopefully our own taxes will attract a lot

of companies to be in Britain, as long as we are in the EU.

Not if they are running the tax regime.

We will leave it there.

That is it for now.

We say goodbye from Politics Europe.

See you soon.

Goodbye.

Hello.

Dry conditions overnight with clearer skies and lighter winds -

a recipe, even in the middle of April, for a touch of frost around.

Given the air is so cold at the moment, a widespread frost and for

some a cold start to Sunday morning.

Temperatures away from city centres below freezing,