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In the middle east hopes for peace negotiations have, for the time being, been extinguished by the folly and shortsightedness of the Israeli electorate. Faced with the deepest crisis in the history of the Israeli state and with the Intifada approaching its annivarsary and showing no sign of fading away and still less sign of being suppressed, however brutal the methods used against it, Israel is in danger of throwing away the greatest chance that it has ever had for a negotiated peace. Her Arab neighbours have shown their readiness for a settlement that will provide for Israeli security. That readiness has been confirmed by latest discussions with senior members of the Syrian Government in Damascus and with President Mubarak in London, as well as by all the further contacts that I have continued to have with other Arab Governments. It has also been confirmed by the remarkable declaration made this month by the Palestine National Council meeting in Algiers.

If the PNC has not yet gone all the way to making the statements demanded by Israeli politicians before they are willing to talk to the PLO--and I hope that they will--it has certainly gone so far in denouncing terrorism and in accepting a two-state solution that it is now incumbent on Israel to respond in a positive manner. The problem for Israel is that, instead of being able to take initiatives, all it can do now is to respond or fail to respond to the initiatives of others.

The quarrelsome and divided Israeli electorate has turned away from the prospect of peace and, instead, created the prospect of a narrow, bigoted Israeli Government who would be expansionist abroad and, at home, would corrupt the dream of a Jewish homeland into a fundamentalist, Khomeinistic ghetto. The only hope for a sane and peaceful Israel now rests with the Labour party of Shimon Peres. I hope that the Israeli Labour party will ponder carefully before considering any coalition with Likud that would be based on a rejection of the peace process for which Shimon Peres fought so courageously up to and including the election campaign.

In the dialogue between the super-powers, which we greatly welcome, progress seems to have stalled since the Moscow summit. When I had discussions with Mr. Frank Carlucci, the United States Secretary of Defence, not long ago, he indicated to me that there were hopes of a START treaty by the end of the first half of 1989. I very much hope that those hopes will be fulfilled and that there will also be progress in the Vienna talks so that we can look forward to a breakthrough on conventional arms reductions. As the Soviet Union has publicly acknowledged asymmetry in conventional forces in favour of the Warsaw pact, such progress should be more likely.

Faced with such challenges, the British Government have scope for a major and constructive role. We may not be a super-power, nor any longer a major world power, but we are an important regional power which, alone among other significant regional powers, has unparalleleed influence through membership of the United Nations Security Council, the Commonwealth, the European Community, NATO and the economic summit. We are the only country in the world to be at the centre of all those intersecting circles, yet the influence available to us is mostly unused and, where used, mostly misused.

Mr. Spearing : I wholeheartedly agree with the sentiments of my right hon. Friend, but does he agree that he is underestimating the potential of Great Britain in this

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respect? Is it not true that we are also the cultural and constitutional centre of the English language and of many democratic institutions throughout the world, that we have an unparalleled advantage in our language and that we would have used our world service and educational institutions to further the aims of peace and concord in the world if the Government had not squandered the opportunities given by both?

Mr. Kaufman : I fully agree with my hon. Friend. Wherever I travel in the world and to whomever I speak, whether in eastern Europe, the Arab countries or all the other places that I visit, I find that the greatest source of objective, genuine information that is valued in those countries is the BBC's world service. The British Council is also greatly valued. I very much hope that the Government will give every support both to the BBC world service and to the British Council because of the great good that they do for the British reputation throughout the world.

I certainly do not blame the Foreign Office or the Foreign Secretary for this lamentable state of affairs. Neither the Foreign Secretary nor his Department has demonstrated any overall cohesive view nor a comprhensive and consistent approach to world affairs, yet the Foreign Office is a remarkable repository of expertise. From my own experience, I regularly see how hard those in our overseas posts work, and so often with such excellent intentions. I should like to take this opportunity of thanking them and those in the Foreign Office here in London, together with the right hon. and learned Gentleman's private office, for all the trouble to which they go to assist with my overseas visits. I should also like to thank the Foreign Secretary and the Minister of State.

It is not the fault of our foreign service that Britain's influence in the world in practice is so much less than it could be, when it could be so substantial. It is the fault of the shadow Foreign Secretary. I do not here refer to myself, but to the shadow that looms over the Foreign Office from the building that faces it on the other side of Downing street--the shadow of the most interfering, meddlesome, negative and baneful Prime Minister with whom the Foreign Office has ever had to put up. If we read the memoirs of Lord Carrington, published only a few weeks ago, we see what hatred the Prime Minister has for the Foreign Office--it emerges from page after page of that lengthy book--and what damage she inflicts on the morale of the Foreign Office.

In almost 10 years the Government have only two achievements to their name in overseas affairs--the negotiations that led to the independence of Zimbabwe and the agreement with China on Hong Kong. They are both achievements entirely of the Foreign Office. Lord Carrington makes clear in his book that the Rhodesia settlement went completely against the instincts of the Prime Minister. She had to be talked into it. It is common knowledge that the remarkable achievement of the Foreign Office on Hong Kong was almost wrecked by the ignorance and arrogance of the Prime Minister.

The right hon. Lady goes marauding around the world, ever alert for the pop of a flashbulb. Her overseas travels are one long quest for the next photo opportunity. Tacitus said of the Romans, "Where they make a desert, they call it peace." The record in foreign affairs of the Prime Minister can be found not in the Stateman's Year Book, but in the Thatcher family photograph album. There is not

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a spot on earth that she has visited which is happier, better off or more peaceful as a result of her frenzied sojourn. Indeed, the record of havoc or broken hopes that she leaves behind is appalling. When the Prime Minister visited Canada, she instructed the voluble Mr. Bernard Ingham to brief the press offensively and inaccurately against the Canadian Government. This month she went further and caused offence in Canada without even visiting the place. Her remarks in the United States led the leaders of both Opposition parties in Canada to complain that she was treating their country as though it were a colony.

The Prime Minister went to Turkey this year, proclaiming before she set out that she would bring back with her the contract for the new Bosphorus bridge. She declared,

"Building bridges is one purpose of my visit."

Click, click went the cameras, but Britain lost the contract for the second bridge to the Japanese, and there is no sign of a contract for the third bridge for Britain.

The Prime Minister went to Poland and lectured the Government there on what she called having

"a real dialogue with representatives of all sections of society, including Solidarity"--

that from a Prime Minister who never has a dialogue with any section of society in this country, most especially not with her Cabinet.

Sir Geoffrey Howe : The right hon. Gentleman may for a moment bask in what little he can bask in--namely, the amusement of his hon. Friends at these absurd observations--but he may like to acknowledge the fact that one of the principal tasks of the Foreign Secretary is to fend off the immense torrent of invitations for the Prime Minister to visit countries, from Poland to Canada. She is recognised throughout the world as a formidable statesman of world stature, whereas the Leader of the Opposition is not recognised even in the countries that he does visit.

Mr. Kaufman : That was lovely, but one of the real jobs of the Foreign Secretary, as I shall have cause to describe in a few moments, is fending off the damage that the Prime Minister does and doing his best to explain it away when it has been done.

Protected by General Jaruzelski's police, the Prime Minister went to Gdansk. She is safer in Gdansk than she is in Gorton. Poles who know little of her, will tolerate her, but my constituents would give her a different reception. However, she does not dare to visit and prate to them as she does to people who live too far away to know much about her. She visited workers who were trying to prevent a shipyard closure when she has been responsible for the closure of most shipyards in Britain. Indeed, she forced a censure vote in this House against the Labour Government's shipbuilding deal with Poland. I stood there and had to defend it.

Mr. Brazier : As someone who worked a number of years as a consultant to the shipbuilding industry, I find it odd that anyone on either side of the House should say that the decline in shipbuilding throughout Europe is the responsibility of one person. Is the right hon. Gentleman unaware of the fact that shipbuilding throughout the world is shrinking and is in recession?

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Mr. Kaufman : The chairman of British Shipbuilders, who was appointed by the Government, paid tribute to the Labour Government and to me for saving the shipbuilding industry by bringing it into public ownership. The Government have brought about a situation in which the merchant shipbuilding force has almost disappeared. The hon. Member for Canterbury (Mr. Brazier) may be a consultant, but the workers in the shipyards--those who remain--know the truth, which is that the Government are the greatest enemy of shipbuilding. We could never have won the Falklands war without the dedicated work of British shipbuilding workers, especially on the Tyne.

The Prime Minister placed a wreath on a monument to strikers when she visited Gdansk. In Britain, the same strikers would have been penalised by her trade union legislation. She offered her sympathy to workers who are fighting for the recognition of trade union rights in Poland, when she is sacking and victimising Government employees in Britain for the specific "offence" of trade union membership. On this subject, Mr. Jerzy Milewski, the director of the office abroad of Solidarity, said :

"Solidarity totally supports the call by the International Confederation of Free Trade Unions, to which it is affiliated, for the immediate reinstatement of the dismissed workers and the full restoration of trade union rights at GCHQ.

We appreciate the British Government's stand on trade union rights in Poland and their support for Solidarity. But the British Government's legitimate concern and welcome sympathy for our struggle could only gain greater authority if they applied the same standards to British workers."

He expressed full support for the British Trades Union Congress and its action, and said :

"They have been with us in the most difficult moments of our independent union's life and they can be sure of the support of Polish workers in their fight for freedom of association." The Prime Minister told the House a few days ago that Solidarity is different from British trade unions and represents what she called

"the only expression of opposition to Communism and Socialism in Poland."-- [ Official Report, 8 November 1988 ; Vol. 140, c. 167.] It is clear that the Prime Minister knows nothing about Solidarity. In his autobiography, "A Path of Hope," Lech Walesa makes it clear that he does not want Solidarity to be a political opposition in Poland and that he supports a Socialist Government for Poland. In response to the Prime Minister's statement that he expresses opposition to Socialism in Poland, Lech Walesa said :

"We're in the process of working out a Polish style of Socialism For the great majority of people, socialism boils down to things we are accustomed to, which we pay no more attention to than the blood circulating in our veins : social benefits, hospitals, schools and so on--the basic essentials all that is best in the economy and in the domain of social welfare is socialism".

That is what Lech Walesa says when he refers to the elements of social benefits which the Government are destroying in Britain and for which proper trade unionism stands.

Mr. Walesa, in his book, specifically states that the aim of Solidarity is to win the right to negotiate on pay and conditions and the right to partcipate in decision-making in the workplace. Those are the proper rights of a trade union anywhere, but rights which the Prime Minister detests and tramples on in Britain. The Prime Minister went to Gdansk to cash in on Mr. Welesa's popularity, without having the faintest understanding of or sympathy for the concepts for which he really stands.

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The Prime Minister-- [Interruption.] I invite hon. Members to read the book. The Prime Minister does not care about democracy or human rights. She cares instead about being photographed with popular people. The right hon. Lady does not even have to start out on her travels to cause trouble and offence. Last week, the talkative Mr. Bernard Ingham briefed Lobby correspondents about the Prime Minister's plans for a visit to Africa. In Africa, millions are starving and thousands are dying in bloodshed through avoidable wars. Mr. Ingham told journalists nothing about the Prime Minister's plans to try to remedy both kinds of tragedy. Instead, the main item in his briefing was that the Prime Minister would use the trip to pay off a score against the President of Zambia through an act of petty spite. The Prime Minister does not have to contemplate foreign travel of her own to cause serious damage. The press is still full of reverberations about Mr. Ingham's briefing of journalists a week ago on the Prime Minister's wish to ban a visit by the Queen to the Soviet Union. It is natural for the Prime Minister, following her pseudo regal progress through Russia last year, to wish to conceal from the Soviet people and their Government that we in Britain have a genuine and extremely popular monarch and that the Prime Minister herself is only a jumped-up and impertinent pretender. The problem is that the Prime Minister's court is a good deal more presumptuous and arrogant than anyone connected with Buckingham palace could ever be. It is time that that gang of placemen were put thoroughly in their place.

There is no doubt that Mr. Ingham gave that briefing. Why did he give that briefing? With whose authority did he give that briefing? What is to be done about Mr. Ingham having given that briefing? I do not expect the Foreign Secretary to know the answers. As so often, the right hon. and learned Gentleman was left in the dark. When questioned about this murky affair in Brussels, this is the way in which he dolefully responded :

"I have not had an opportunity to study this question and I have not been in London in the last few days. I do not want to comment on this. If you want a comment, you had better ask them in London. You had better talk to London."

What a humiliation for the Foreign Secretary, who should be providing advice for the palace on such an issue. Instead, he is put in the shade by the people in 10 Downing street, who care so little for the office of Foreign Secretary.

Then there was the Prime Minister's visit to Bruges. The Foreign Secretary spoke a good deal about the Community, but for some reason which escapes me he did not refer to the Prime Minister's speech to the college of Europe on 20 September. I wish to put some detailed question to the right hon. and learned Gentleman about the speech, and I shall readily give way to allow him to answer each one. In her speech, the Prime Minister said that she is against

"decisions taken by an appointed bureaucracy."

Does the Foreign Secretary agree with that? If so, how does he reconcile it with the provision in the Single European Act, which adds to EEC treaty article 145, on powers of the Commission, a provision to confer further implementing powers on the Commission? The Commission is, of course, the Community's appointed bureaucracy. The Single European Act is now embedded in United Kingdom law through the European

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Communities (Amdt) Act 1988, which the Foreign Secretary guillotined to allow it to pass through Parliament.

At Bruges, the Prime Minister said that she is opposed to a European superstate. Does the Foreign Secretary agree with that? If so, how does he reconcile it with the provision in the Single European Act, which is now United Kingdom law because of the European Communities (Amendment) Act, which commits participants, including the United Kingdom, to transform relations among the member states into a European union? Does the right hon. and learned Gentleman agree with the Prime Minister's insistence in Bruges on the need to preserve individual members' parliamentary powers? If so, how does he reconcile that with the provisions in the Single European Act to draw up by the end of 1992 an inventory of relevant national laws not yet harmonised and submit appropriate proposals?

Does the Foreign Secretary agree with the Prime Minister that "it is a matter of plain common sense that we cannot totally abolish frontier controls"?

If so, how does he reconcile that with the provision in the Single European Act for the Community, by the end of 1992, to comprise an area without internal frontiers?

Does the Foreign Secretary agree with the Prime Minister's opposition to what she called, in her Bruges speech, "power centralised in Brussels"? If so, how does he reconcile that with the provisions in the Single European Act that introduce majority voting, partly or wholly, into six articles of the EEC treaty at present requiring unanimity for action, and which provide for majority voting in five of the new supplementary articles?

How does the Foreign Secretary reconcile that with the commitment to ensure balanced progress by qualified majority and with the commitment to replace unanimity in the EEC treaty article 59(2)? As Mark Antony said in "Julius Caesar",

"I pause for a reply."

Mr. Tony Banks : The Foreign Secretary is not even listening.

Mr. Frank Dobson (Holborn and St. Pancras) : Come on, get up and answer.

Mr. Kaufman : The Foreign Secretary's lack of response is interesting.

Itemised, one by one, every one of the major issues to which the Prime Minister says she is opposed is embedded in British law. They were opposed by the Opposition, but they were forced upon this country by the use of the guillotine. Yet the Foreign Secretary has nothing to say and can only accept the yawning gap between the words of the Prime Minister and the truth of the matter.

We have the right to state our reservations and objections to these matters. We fought the legislation through the House, and it was guillotined because we did so. How does the Prime Minister purport to oppose for Britain what she ordered her parliamentary majority to impose on Britain? It is no wonder that the West German newspaper Die Zeit pronounced the Prime Minister as hypocritical. Nowhere else has that hypocritical attitude been more plainly manifest than in the areas of defence and disarmament. On Tuesday, the Prime Minister boasted that

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"the defence budget will grow by nearly £1 billion a year over the next three years."--[ Official Report, 22 November 1988 ; Vol. 142, c. 27.]

That is the measure of the Government's determination to ensure that our forces have the most modern and up-to-date equipment, both nuclear and conventional. Yet that cash increase masks a reduction in defence expenditure in real terms. It is certain that there will be a reduction in real terms in 1989-90. In 1990-91 and 1991-92, there will be further reductions unless inflation falls to 3.5 and then to 3 per cent. Yet inflation now stands at 6.4 per cent.

That brings me to another question for the Foreign Secretary. Perhaps he will answer this one because he has pointed out that, as well as holding his current post, he was once Chancellor of the Exchequer. During the Prime Minister's manic visit to Australia, she encountered a very rare Antipodean species. I refer not to a wallaby or a koala, but to a television interviewer who did not treat her with sycophantic self-abasement. It was Mr. Kerry O'Brien who had the cheek to pull up the Prime Minister when, letting her true sympathy for apartheid show through, she talked about the "small amount of poverty" in South Africa.

Discussing inflation with Mr. O'Brien, the Prime Minister said that inflation in Britain, then at 4.6 per cent., was

"not as low as I would wish".

She then went on to declare :

"I should be very surprised if it got up to about seven." Can the former Chancellor confirm that statement by the Prime Minister and assure the House that inflation in Britain will definitely not rise to 7 per cent.? After all, in Australia the Prime Minister said that that would not happen.

Even if the Foreign Secretary can give us that assurance--although, once again, he is failing to respond to a very simple question--it is clear that, even on the Prime Minister's own boast, spending on defence in Britain will fall in real terms over the next three years and that, because of the pointless, wasteful and irrelevant expenditure on Trident, expenditure on conventional defence--which should be our real contribution to NATO--will fall substantially. It therefore makes especial sense for Britain to play an active and constructive role in conventional disarmament talks. We are simply not playing such a part, and we have actually been obstructing those talks. Once again, the responsibility lies with the Prime Minister. When I met the United States Defence Secretary, Mr. Carlucci, for talks in Washington three months ago, we discussed these issues. I asked him why the West had not accepted the proposals by Mr. Yazov of the Soviet Union for an exchange of data, and Mr. Carlucci replied : "You don't want to get me in trouble with Mrs. Thatcher, do you?" I took down those words on his own Defence Department pad in his office. Mr. Carlucci said that he was ready to exchange published data. What the Foreign Secretary has announced today, with such a flourish, is not an exchange of data, but merely unilateral assessment.

The Prime Minister, obstructive on conventional disarmament, is positively destructive on nuclear disarmament. Wholly

misunderstanding the role of battlefield nuclear weapons, she demands modernisation

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as a means of deterrence. By that stance, she shows that her real aim is to nullify the INF treaty, which is removing from Britain the cruise missiles to which she is so attached.

The Foreign Secretary said today that the West should remain united on arms control, but the West is not united on that issue. The Prime Minister is at serious odds with West Germany, as emerged clearly during my visit to Bonn a few weeks ago when I had discussions with Herr Genscher, the Foreign Minister, and Herr Scholz, the Defence Minister. There is also, of course, the opposition of the Belgians to modernisation. Chancellor Kohl of West Germany made it clear that he is opposed to any modernisation that would be a way around INF-- [Interruption.] Oh, yes. Herr Genscher and Herr Scholz made it clear to me--I have published this and it has been accepted by the West German Government--that they do not regard modernisation as justified before it is necessary and that they regard battlefield nuclear weapons as a provocation to war rather than a protection against it. That is what those members of the Federal Government said to me, together with Herr Scha"uble, who is the head of the Federal Chancellery. They do not regard any of those weapons as a deterrent. Opposed to conventional disarmament, obstructive on NATO land-based nuclear arms, the Prime Minister stands clutching her so-called independent nuclear deterrent, the Trident missile, which she leases from the United States at massive cost and which can be serviced only by six day's journey across the Atlantic to King's Bay, Georgia, where every tiny spare part is kept. While she struts about the world stage like a Walter Mitty with megalomania, the poor old Foreign Secretary--now repudiated as her potential successor--is left to pick up the pieces.

The Prime Minister dismissed the notion of a common European currency. The Foreign Secretary, in his speech to the Kangaroo Group in Paris earlier this month, called for

"further practical concrete steps to greater currency stability" in the context of an attack on the wastefulness of 12 different Community currencies. The Prime Minister attacks every major consequence of 1992. The Foreign Secretary pleads that we should regard 1992 as good news. The Prime Minister attacks the abolition of frontiers. The Foreign Secretary rejoices over what he calls "a barrier-free Europe", giving

"new dynamism to the Community."

Going around trying to smooth out the offence that the Prime Minister causes wherever she goes and to sort out the confusion that she creates, our Foreign Secretary--who is in charge of one of the best Foreign Offices and Diplomatic Services in the world--has been reduced by the Prime Minister to the role of the man who comes along with the shovel at the end of the Lord Mayor's procession. There are major opportunities for Britain and we could play a worthwhile and constructive role. Given the chance, the Foreign Secretary would do his best to play that role. Let him, at long last, stand up to the Prime Minister and assert his authority as a senior Secretary of State. If he does that, he will have the support of the Opposition.

10.49 am

Mr. Julian Amery (Brighton, Pavilion) : I suppose that we all agree that it is the duty of an Opposition to oppose, but the bitterness and waspishness of the attack of the

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right hon. Member for Manchester, Gorton (Mr. Kaufman) on the Prime Minister can be explained only by his sense of frustration at eight years in opposition.

The map of the world is undergoing great changes. We do not have many debates on foreign affairs, but this is an opportunity for constructive thinking. I hope that we shall have a more generous and constructive expression of views from the right hon. Member for Leeds, East (Mr. Healey), if he succeeds in catching your eye, Mr. Deputy Speaker.

I shall, however, take up the remarks about Europe made by the right hon. Member for Gorton and add to the debate that has arisen since the speech of my right hon. Friend the Prime Minister in Bruges. Nobody could doubt the commitment of the Government and of my right hon. Friend to Europe and European union. Our economy, security and role in the world depend on it. That is clear, and even the Labour party is coming round to recognising that our destiny lies in European union.

The debate has been over simplified in the press as one between inter- Government union and federation. There has never been any serious question of a European federation in the sense that the United States is federal. Our own experience points to that. At the beginning of the century, the British Government tried to create a federation of the self-governing parts of the British empire. They proposed an imperial Government, a customs union and an imperial navy. The people of Australia, New Zealand, Canada and the two smaller South African colonies were most loyal and affectionate. But they turned down the proposal because, after 50 years of self-government they had acquired a sense of nationhood that forbade them accepting the federal proposal. Hon. Members cannot tell me that ancient and famous countries such as Britain, France, Spain and Germany will be corralled into an imitation of the constitution drawn up by Alexander Hamilton for the almost uninhabited United States where there were still almost as many Red Indian tribes and buffaloes as there were European settlers.

But there is a constitutional issue at stake--the relationship between Ministers and the European Commission. It is not a crisis but a European version of "Yes, Minister". There has always been a certain tension, as any of us who have held office will know, between a Minister and his officials. In private the officials often regard themselves as the real Government and regard the Ministers as the tribunes and public relations officers who are supposed to put across the Departments' views. There is a problem here. The real Government, in so far as we have an embryo Government of Europe, are the Council of Ministers.

As the right hon. Member for Gorton has said, the Commission is the bureaucracy. It is important for the Council of Ministers to keep the Commission in its place. I do not mean that Mr. Delors is a super "Sir Humphrey", but it is important that the Ministers should make their supremacy clear. My right hon. Friend the Prime Minister's speech may have been abrasive, but it delighted most of her ministerial colleagues on the Continent--at any rate, that is the impression that I have formed from talks with some of them. Having expressed strong support for my right hon. Friends general view that the Council of Ministers' supremacy must prevail, I have one or two reservations about the speech she made in Bruges and to which the right hon. Member for Gorton has drawn attention. Is it really necessary to say that we must maintain border and

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customs control after 1992? Before 1914, there were virtually no border controls in Europe and one could travel almost anywhere in Europe, except in Turkey and Tsarist Russia, without a passport. Since we were a free trade country, we hardly bothered with Customs. We look a bit silly now talking about border controls against terrorism and drugs when the one open border in the United Kingdom is the border with the Irish Republic where many sympathisers of the IRA live. We should reconsider that matter.

The single currency is a long way away, but here again we should reflect on the past. For a long time we had a single currency in Europe in the form of gold. One could travel anywhere ; and gold coins, the sovereign, the napoleon and the German gold mark were interchangeable.

In 1931 we had another limited experience of a single currency when we went off gold and created the sterling area. Although not all of the currencies in the sterling area had the same parities, there was virtually a single currency between them ; and that currency, which became a reserve currency, was accepted, second only to the dollar, by the world until the 1960s.

I am not sure that we need a central bank to have a single currency. There was not a central bank for gold and, although the Bank of England acted as a reserve bank for the sterling area, it was not the only issuing house and it did not own the reserves which other sterling area countries pooled there.

Let me say something in parentheses. Hardly a month goes by without one of my right hon. Friends recommending the privatisation of something now in Government ownership. There is always some new privatisation plan, whether it is for water or electricity, or whatever, but I have never heard anyone suggest the privatisation of the Bank of England. Yet the German Bundesbank and the federal reserve bank of the United States are virtually privatised- -or are at least independent of Government. Would it make things easier for the Government to contemplate a reserve bank for Europe if the Bank of England were privatised?

We must remember that the emerging European constitution will inevitably be outward-looking because all of us, in different ways, have close links with countries outside the European Community. The old imperial powers--France, Britain, Spain and Portugal--have close links with other parts of the world --North America, Latin America and Africa. The Germans still have hopes of reunification. None of us wants to see a tight, little western Europe--it should be outward looking. Already countries not yet in the Community are thinking about applying for membership, the Austrians are interested and also even Finland.

As the Soviet empire in Europe loosens up, the Community may well become a magnet to which countries such as Hungary and the Danube valley countries may be attracted. They know that the Soviet Union is incapable of giving them the necessary economic support to redeem their poverty. It is not surprising if they look towards the Community as a source of investment and funds.

We have travelled a long way since the idea of a united Europe was first launched in 1946. We are attempting something which has never been attempted before. Many people have tried to unite Europe by force, but this is the first time that an attempt has been made to do it with the free consent and will of those involved. It is not an easy

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task. We have certain uniting traditions, such as the classical traditions of Greece and Rome and the Judaeo- Christian tradition, but we also face some formidable difficulties which are not easy to overcome.

It being Eleven o'clock, Mr. Speaker-- interrupted proceedings, pursuant to Standing Order No. 5 (Friday sittings).

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Nurses (Dispute)

11 am

Mr. Robin Cook (Livingston) (by private notice) : To ask the Secretary of State for Health what action he proposes to take to end disruption in the Health Service following the breakdown of talks through ACAS.

The Secretary of State for Health (Mr. Kenneth Clarke) : That is in the hands of the trade unions, particularly the two unions that are attempting to organise industrial action. I regret that they made it clear in the talks at ACAS that they were unwilling to end industrial action and seeking to reopen the basis on which the regrading exercise was carried out. That exercise has been completed and the largest real pay rise for nurses and midwives in the history of the National Health Service will be in this month's pay cheques. The majority of nurses and midwives will receive all their back pay in December.

The overwhelming majority of nurses and midwives are working normally. Although there can be no question of reopening the basis of the new career structure, I shall discuss remaining issues with the Royal College of Nursing at its request on 5 December. I am not prepared to talk to NUPE and COHSE unless they call off their attempts to organise industrial action.

Mr. Cook : Is the Secretary of State aware that last night I, with other hon. Members, met all members of the nurses' staff side, including the unions and the royal colleges? Does he accept that, contrary to the statement that he has just made to the House, all members of the staff side made it plain that they had been willing to call off all industrial action if the management side had been willing to enter into discussions on the points in dispute? Why does he not admit that the talks broke down yesterday because the management side refused to enter into talks even if industrial action was called off, and made it clear that in doing so it was acting on ministerial instruction.

Does the Secretary of State accept that the representative of the RCN made it plain yesterday that the college went to ACAS only because the other unions were willing to call off industrial action, and described the management response as a kick in the teeth? Does he accept that all members of the staff side, including the royal colleges, informed us last night that it will now be difficult for each of them to restrain their members from industrial action? Is he really prepared to do nothing when what should have been an historic improvement in the nursing structure degenerates into a major crisis of morale in the wards and disruption in the hospitals?

Will the Secretary of State concede that the guidelines on supervision and responsibility were not part of the April agreement and have never been negotiated? If he is so confident that he is right in this guideline, why has he refused the invitation of all unions, including the royal colleges, to submit that to binding arbitration? Why is he so afraid to take a second opinion on his unilateral interpretation?

Will the Secretary of State confirm the extraordinary letter that he sent me yesterday in which he admitted that two letters from the general secretary of COHSE had not been replied to by him due to "a clerical oversight"? How does he expect the nurses in our wards to take seriously his lectures on the need for commitment to the job from them when he is so incompetent in running his office that he

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twice loses a letter from a leader representing 150,000 nurses? Does he not understand that our Health Service is fated to experience mounting disruption so long as it is in the hands of a Secretary of State who, since his appointment, has never met the leaders of the nurses who work in the wards and who now makes it a point of pride to snub them?

Mr. Clarke : In answer to the hon. Gentleman's first point about the decision of the various trade unions, I can do no better than to quote from a statement issued this morning by Mr. Trevor Clay on behalf of the RCN--

Mr. Frank Dobson (Holborn and St. Pancras) : From Korea?

Mr. Clarke : From Korea. That is right. A statement was also issued in London by Mrs. Gillian Sandford. Mr. Clay, the general secretary of the RCN, said :

"Perhaps it is time the other unions recognised that the RCN does not regard industrial action as negotiable. ACAS provided a way back into the discussions and they"--

the trade unions--

"have chosen not to take it.

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