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Mr. Norman Tebbit (Chingford) : I share my right hon. Friend's view on enlargement. Does he think that the creation of a single currency among some or all of the existing Twelve would facilitate or make more difficult the process of enlargement?
Sir Richard Luce : We do not have to take a clear view on that at this stage. We can await developments in the next few years, when we have the freedom to decide what to do. We must accept that, if the Community is to grow, there will be different speeds and tiers of co-operation. That is why I welcome the fact that my right hon. Friend the Prime Minister is to take the lead in working out the implications of such a move.
I am glad that my right hon. Friend the Prime Minister believes that closer collaboration between the Community and central and eastern Europe is essential for the stability of Europe. We cannot escape that fact, and it should be the Government's mission to take a lead in helping to enlarge the Community and to assess the implications of doing just that. I congratulate my right hon. Friend on the
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statesmanship that he has shown. This is the right Government to lead Britain through to the next stage of the development of the Community.5.14 pm
Mr. Paddy Ashdown (Yeovil) : I beg to move, to leave out from House' to the end of the Question and to add instead thereof : whilst welcoming the fact that the United Kingdom became a signatory at Maastricht to an agreement which represents an historic step towards a federal Europe, regrets that the Prime Minister, by insisting on opt-out arrangements for the United Kingdom on Economic and Monetary Union and the Social Chapter, rather than negotiating improvements, has left Britain semi-detached from Europe, obliged every citizen to pay a price for the divisions within the Conservative Party and damaged the prospects for Britain's long-term economic and political success.'.
Although I am delighted that it is our amendment that will be called tomorrow, it is extraordinary that the Labour party has not been able to move an amendment to the motion. The hon. Member for Bolsover (Mr. Skinner) who is sitting in front of me has revealed the reason--it is the only course of action that can unite Labour Members in the Lobbies as they are as divided on this as the Government have been revealed to be.
Mr. Skinner : I am interested in the amendment moved by the leader of the Liberal Democrats as it mentions the Government's views on the social chapter. I heard the right hon. Gentleman on the "Walden" show a fortnight ago, when he instructed the Prime Minister to vote against the social chapter. Today he has tabled an amendment which states the opposite. No wonder they call him Paddy Backdown.
Mr. Ashdown : I assure the hon. Gentleman, whose intervention I know was made in a spirit of good will, that I shall come to that later in my speech-- [Laughter.] I certainly will. He will then know precisely what we objected to in some elements of the social chapter. I do not wish to betray any confidences, but the hon. Member for Bolsover told us earlier that this fix among Labour Members was his work. He called himself the Earl of Warwick in this context--a strange earl indeed--but things have come to a pretty pass when cohesion in the Labour party has to be arranged by the hon. Member for Bolsover
Mr. Skinner : I have done it many a time.
Mr. Ashdown : For the European Community, Maastricht marks a decisive and irreversible step towards integration and unity. It could have been a decisive moment for Britain, too : the moment when Britain decided to end 40 years of indecision and ambivalence--aspects which have dogged our policy towards Europe and done so much damage to our success as a nation. Maastricht could have been the moment when we learned the lessons of our past mistakes : first staying out of Europe, then having to join later, and ending up submitting to institutions and policies which had been shaped without us. I was fascinated to hear the Prime Minister mention the need to reform the common agricultural policy. It certainly needs reform, and one of the reasons is that when it was drawn up we had opted out. Now we have to deal with the consequences.
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Maastricht could have been the moment when Britain declared without qualification, once and for all, that our future belongs to a united and dynamic Europe. It could have been an historic week for Britain as well as for Europe, but it was not.The most interesting part of the Prime Minister's speech was the unscripted portion, following the fascinating question by the right hon. Member for Chesterfield (Mr. Benn) about his agreement with the concept of a commonwealth in Europe. His only slightly qualified agreement with that model of Europe gave us an insight into the Prime Minister's mind, which for the past six months he has denied us in order to hold his party together. Now the Prime Minister's real vision--if that word is not too offensive to him--of the future stands revealed. In that moment he opened up the division between his view of Europe and that of the Foreign Secretary, who clearly does not feel the same way. He also showed his isolation from every other leader throughout Europe. That is his vision. But no other nation at Maastricht shared that vision. It is a classic example of the isolation into which the Prime Minister now wants to lead our country.
The Minister of State, Foreign and Commonwealth Office (Mr. Tristan Garel-Jones) : If that is so, why was the draft treaty text put forward by the Dutch--sporting what one might call "the other vision"--rejected by 10 of the 12 member states?
Mr. Ashdown : I know that the Minister has a different view from that which the Prime Minister has expressed on such matters. I invite him to read the Prime Minister's response to the right hon. Member for Chesterfield, which was far and away the most interesting part of the debate-- [Interruption.] Amended text or not, it reveals the muddle to which the other 11 nations of Europe do not subscribe. It is a model towards which they are moving away from--
Mr. Skinner : What does that mean?
Mr. Ashdown : It is a model away from which they are now moving. They are moving towards increasing integration and increasing unity. That part of the Prime Minister's speech will be studied carefully because it reveals his intentions, although I do not believe that they are shared by the Minister.
The Prime Minister declared again today that Maastricht was a good deal. Maybe it was a good deal for the Conservative party, but it was a very bad deal for this country. Every citizen in Britain in due course--in my judgment, it will be sooner rather than later--will pay a real, direct and personal price for what the Prime Minister negotiated at Maastricht. People will pay first in higher mortgages, lost jobs and diminished economic opportunities because of the uncertainty caused by the opt-out clause on the single currency. That uncertainty means higher interest rates if the pound comes under pressure and has to be supported again. It means more doubtful inward investment. Whatever comments were made in the heat of the negotiations at Maastricht, there can be no doubt that those who wish to invest in Europe will want to invest in countries that will be part of the economic and monetary union and not in countries outside it. It will mean more
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doubtful inward investment at the very moment when this country needs such investment most, as we come out of the recession. It means the end of any realistic possibility of bringing the new European central bank to London. It means that London's position as Europe's main financial centre has been weakened and that that of Frankfurt has been strengthened.Mrs. Currie : I wonder whether the right hon. Gentleman has read last week's edition of The Economist, which investigated which European Community countries conformed with the convergence conditions set in the treaty. The right hon. Gentleman is worried about uncertainty, but is he aware that the United Kingdom is already included in four of the five lists of items which create convergence and that only the fifth--the narrow band of the ERM--separates us ? We are a lot closer than Germany, Italy and the vast majority of the Community. Where is the uncertainty in that ?
Mr. Ashdown : I am grateful to the hon. Lady because she makes the point that I was coming to. In those circumstances, why on earth stay out ? The hon. Lady is right--the tragedy is that Britain is one of the few member states which could have met the convergence conditions of the EMU almost immediately. This country has paid a high price for that in lost jobs, lost homes and bankrupt businesses because of the effects of the Government's economic policy. The Government now risk throwing it all away because of the conditions to which the hon. Lady referred. Instead of playing a leading role in the new monetary union, we shall be semi-detached from it--robbed of our full chance to shape its institutions, suffering economically because of the uncertainty, and condemned always to follow monetary union, never to lead it. That is what the uncertainty created by the Prime Minister's opt-out will cost us.
That uncertainty would continue under Labour. We have studied the Labour party's recent pronouncements and we now know that Labour proposes to renegotiate the whole deal. In last Friday's edition of The Times, the shadow Foreign Secretary stated that Labour would "review" the
"role and powers of the European Commission work for conditions to make the single currency possible and attractive". By the by, those conditions are wholly unacceptable to our partners and would destroy the whole purpose and form of a central bank. The right hon. Member for Manchester, Gorton (Mr. Kaufman) also said that Labour would "negotiate for revision" of the social protocol. Come back Harold Wilson--all is forgiven. The Tories would like to repeat the mistakes of the 1950s, while Labour are determinted to repeat the mistake of renegotiation in the 1970s.
The second way in which Britian will pay for the deal is in lost influence in Europe. At Maastricht the Prime Minister reinforced Britain's wretched reputation as the chief roadblock of Europe. We are not the partners who must be consulted--we are now the obstacle around which the rest of Europe must find a way. Other member states bypassed us on the single currency by giving us an opt-out, for which the Prime Minister had to pay at Maastricht --and for which the British people will have to pay even more in the months ahead--and they bypassed us on the social chapter by simply going ahead without us.
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The rest of Europe will now construct the social institutions of Europe with Britain excluded--but we shall not be excluded from being influenced by what they do in the short term. No doubt we shall, once again, want to join them in the end. Britain proves yet again that those who will not learn the lessons of history are condemned to repeat the mistakes of history. That is exactly what we have done twice before in this half century.As is well known--the hon. Member for Bolsover has referred to this--the Liberal Democrat party was not content with all the provisions in the social chapter of the Maastricht drafts. For the benefit of Mr. Ian Aitken and The Guardian, and others, our objection was not to the social charter which was, of course, not even under discussion at Maastricht--although the Leader of the Opposition did not seem to know that. Our objection was to elements of the social chapter in the treaty--
Mr. Skinner : That is not what the right hon. Gentleman said to Walden.
Mr. Ashdown : That is exactly what I said both then and subsequently. Article 118/3 of the social chapter opens the way, as the Prime Minister said, to European-wide collective bargaining. In Britain, we have moved away from such arrangements. They are wrong for this country's future and contrary to this party's belief in decentralised wage bargaining. Again, the Leader of the Opposition seemed not to grasp the fact that, in article 118B, the social chapter provided for circumstances in which, if European businesses and trade unions agreed, they could take Europe-wide action through the Council without reference to the European Parliament, let alone this one. That is simply inimical to this party's commitment to a democratic, powerful and responsible European Parliament. Fortunately, both those clauses enjoy the protection of unanimous voting or could be changed when they came to practical application into law. However, we would have wished to see those clauses altered. Indeed, they could have been altered if the Government had not wasted their bargaining power in attempts to defend the indefensible, attack the trivial and obtain the illusory.
Therefore, when it came to the social charter, when we really would have liked to influence events, Britain was left with no negotiating power, few friends and only one course of action--to opt out of the social dimension altogether. That was not game, set and match for Britain ; it was a lousy piece of negotiation which left Britain on the sidelines of Europe.
Perhaps more regrettable is the fact that a real opportunity has been missed. If there is one area in which Britain is ahead of Europe, it is in the liberalisation of our markets and the dismantling of the systems of the corporate state. At present, our partners in Europe tend to follow an old- fashioned prescriptive approach to social policy. That is very familiar to the Labour party. Labour Members like the idea that one can formulate the blueprint in Brussels and hand it down to be followed in every corner of the Community. That is the kind of approach that they would like to have again at Westminster. It is, however, an approach that failed in the 1970s, and one that will not work in the 1990s. It is too inflexible, too costly, and too rigid.
We need not a "blueprint" approach but an "entitlements" approach to rights at work and in society. Europe should be built around the concept of European
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citizenship, with each citizen entitled to certain defined basic rights--political rights, rights of ownership, rights at work and social entitlements. It is for the European institutions to define those "floor-level" rights, but it is not for Brussels to say how they will be observed. It is up to each individual state and each individual workplace to decide that for itself--subject, ultimately, to the decisions of the courts.Incidentally, if our Government really believed in the principle of subsidiarity, they would have ensured that decision-making would be decentralised within the United Kingdom as well as within the Community. The new treaty tells us that decisions will be "taken as closely as possible to the citizens".
I say "Yes, please--and why not start in Scotland and Wales?" The third great deficiency of the Maastricht treaty--again one that Britain, to its discredit, helped to create--is its entirely inadequate response to the democratic deficit in Europe. Here is the Government's big lie : the claim that an increase in the power of the European Parliament would mean a decrease in the power of the Westminster Parliament. Nothing could be further from the truth. The truth is that in European affairs it would be difficult to diminish further the power of this Parliament.
Our Parliament does not hold the Commission to account. We do not even hold our own Ministers to account. We do not scrutinise European legislation properly ; indeed, we allow the Executive to carry on very much as it pleases. That is the democratic deficit. We need the European Parliament to repair it, but in that regard the Maastricht treaty has comprehensively failed.
The European Parliament remains far too weak. In the end, it will have to be strengthened to play a full democratic part in the Community. In the end, we shall have to ensure that all laws passed by the Council must also be passed by the Parliament. That is what co-decision, democracy and accountability actually mean.
Mrs. Gwyneth Dunwoody (Crewe and Nantwich) : I agree that it is important for our Parliament to examine EC legislation closely. The House has two very effective European Committees, but there seems to be an astonishing dearth of Liberal Democrats prepared to sit on them, although they have the right to do so.
Mr. Ashdown : That is a perfectly reasonable point. I will explain the position. As there are only 20 Liberal Democrats in the House--although we are supported by 23 per cent. of the electorate--it is impossible for my colleagues and me to involve ourselves in all the work of the House.
Until the European Parliament is strengthened, the events about which the Government and the European separatists most like to complain--those brought about by an interfering and inappropriate Brussels--are likely to continue, because the Government missed the opportunity to make the Community more democratic and accountable. Perhaps that is what they want, but it is not good for either Britain or Europe.
Mr. Harry Barnes (Derbyshire, North-East) : Will the right hon. Gentleman give way?
Mr. Ashdown : I think that I have already given way a reasonable number of times.
Fortunately, we in this Parliament have never seen Maastricht as an end. We have always seen it as a
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milestone on the road to closer integration and closer unity. There are those in the House who pretend that that is not so. The Prime Minister, to appease members of his own party, pretends to be one of them, but he knows the truth. He knows that, although Maastricht may mark a watershed in the process of integration, it does not mark the end of the process. With or without Britain, the rest of Europe will continue along the road.Of course, we cannot be certain that Europe will succeed. There are huge problems--economic, historical and social. Perhaps those problems will ultimately prove too great. Perhaps Europe's leadership will prove too weak. Perhaps the essential task of bringing in the new democracies of eastern Europe will founder on economic collapse, ethnic unrest and social upheaval. I am certain of one thing, however : we must do all in our power to ensure that none of that happens. Europe cannot stand still. There is no refuge for us in simply maintaining the level of integration at which we have now arrived. If Europe does not go forward, it will start to go back-- back to a Europe given to confrontation and not co-operation, back to a Europe where Germany exploits its economic power and its position as broker between east and west, and back to a Europe where instability in the east is matched by impotence and indecision in the west. That cannot be in any of our interests, especially at this time.
Ministers pride themselves on their attention to detail, but I ask them to lift their eyes and survey a broader picture. They should look at the Europe that will exist in five or 10 years' time, at a Community with 18 or 20 members and perhaps even more, and at the interests that we have in common--security, defence, foreign policy, the environment, prosperity and peace in the world. That Europe must be more united, more effective and more far-sighted. It will view the events of Maastricht as important, but as yesterday's agenda, and it will marvel at the failure of countries and their leaders to grasp the opportunities for progress.
I am certain of something else, too. It is in Britain's interest for us to be at the heart of that Europe--where the Prime Minister said that he wanted us, but where he signally failed to put us at Maastricht. We should be helping to shape the democratic institutions on which Europe will depend. We should be providing leadership in the new economic institutions that Europe will need. We should be making available our experience of world affairs, which will be essential to the outward-looking Europe that we must create.
That was the opportunity that Maastricht could have given us. The Prime Minister failed to grasp that opportunity. He put the short-term interests of the Conservative party before the long-term interests of this country. Sadly, Maastricht represents the third occasion in half a century on which Britain has been given the chance to face its European future and, I regret to say, the third occasion in that time on which we have chosen to seek refuge in the past. For that failure the country will, in due course, pay a heavy price.
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5.37 pmMr. Nigel Forman (Carshalton and Wallington) : I pay warm tribute to the Leader of the Opposition for his fine debating speech. His debating technique, however, disguised some fatal flaws and internal contradictions in Labour policy. Not the least of those was highlighted capably by my hon. Friend the Member for Wolverhampton, South-West (Mr. Budgen), who pointed out that, if the right hon. Gentleman was to achieve any of his aims in regard to European monetary union and convergence, he would be required to support policies that would inevitably increase the country's tax burden considerably.
The right hon. Member for Yeovil (Mr. Ashdown), the leader of the Liberal Democrats, presented what appeared to be a coherent policy on Europe. He has adhered to that policy consistently for several years. I feel, however, that it takes insufficient account of the natural caution and pragmatism of the British people, which was admirably reflected in the negotiating approach of my right hon. Friend the Prime Minister and his colleagues in the Cabinet.
I congratulate my right hon. Friends the Prime Minister, the Foreign Secretary and the Chancellor on their negotiations leading up to Maastricht and at the conference itself. Their approach was in great contrast to what might have been the position had the official Opposition been in government. In case the House doubts the substance behind that view, it has only to consider a Gallup opinion poll that appeared recently in The Daily Telegraph. It showed that by a ratio of 2 : 1 the electorate preferred to have my right hon. Friend the Prime Minister in charge of the policy than the Leader of the Opposition. Liberal Democrat supporters shared that view by about 4 : 1. Clearly, the British people know when the policy is in safe hands.
Looking back, we can see that the Maastricht summit was the culmination of a long process--a significant stage in the development of the European Community. It was the stage at which the 12 member states did a good deal more to clarify their long-term goals. I am referring particularly to European monetary union with a social dimension, coupled with aspirations towards European political union which, as can be seen from the debates that we have had in the House and those on the continent, means many different things to many different people. It was also the stage at which the Twelve addressed the critical questions of structure and procedure for the future development of Europe : whether the Community and Europe as a whole wish its design to be more or less monolithic, whether it wants to be more or less supranational, whether it wants to have more or less qualified majority voting and more or less jurisdiction for the European Court of Justice.
Mr. Nicholas Soames (Crawley) : Does my hon. Friend agree that the pillared structure that has been negotiated by our right hon. Friends is more likely to provide the sort of flexibility that the institutions will need, bearing in mind that Europe is standing, to some extent, on shifting sands and that none of the situations extant in the 1950s, at the birth of the Community, remains the same today? It may be that there will have to be extensive changes in those institutions in the years to come.
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Mr. Forman : I agree with my hon. Friend, but I go further. The 1990s provide a great opportunity for Her Majesty's Government to demonstrate to our Community partners the validity of the new hybrid approach that the Government have pioneered.It is interesting to note that, in attempting to answer the questions at Maastricht, most of our Community partners said that they wanted to go faster and further forward. The Government correctly understood and successfully argued that in most of the new areas of competence the approach should be largely
intergovernmental--as was suggested by my hon. Friend the Member for Crawley (Mr. Soames)--thus introducing a greater element of flexibility into the future institutional arrangements of the Community. That must make sense in the policy areas to which my right hon. Friend the Prime Minister referred--foreign policy, security and home affairs. We now have the opportunity to demonstrate in practice that our more hybrid approach is better suited to the needs of the next decade.
The new methods of European co-operation will prove increasingly relevant and useful in the enlargement of the Community, which will carry on apace from about the mid-1990s and--this has not yet been mentioned in the debate --in the awakening of public opinion in France and Germany where they are beginning to realise some of the implications of what their political leaders have signed. On the eve of 1992, we must encourage our partners to focus in sensible ways on the real challenges of the coming 10 years. What do I mean by that?
Sir Russell Johnston (Inverness, Nairn and Lochaber) : Does the hon. Gentleman agree that the intergovern-mental co-operation which was a characteristic of the European Free Trade Association was not successful? To suggest that that is the way forward for the future must be objected to by the fact that Sweden, Austria and the EFTA countries now want to join the supranational Community.
Mr. Forman : I do not agree with the hon. Gentleman, but I understand his point from an historical perspective. However, the Community has always had variable depth in its integration--in some areas it has been deeply integrated and in others there has been shallower integration. It is appropriate that the areas of policy now being pushed forward on an intergovernmental basis should be done in that way because that is how we carry with us consent in our national Parliaments and public opinion.
The programme for the next 10 years should be based on a clear recognition of the need for an early enlargement to include the aspiring EFTA countries, to which the hon. Member for Inverness, Nairn and Lochaber (Sir R. Johnston) referred, and the three central European countries--Poland, Hungary and Czechoslovakia--to the east of the Community. That would make irreversible the shift to democracy, market economics and social pluralism in the former communist states. In its wisdom, the Community felt able to do that for the Iberian peninsula a few years ago and it would be right and proper for it to do something analogous for the central European countries. I hope that the Community will concentrate on providing within its borders only those things that it does best--a common legal framework for a large liberal market economy with a social dimension. That is the formula and it is what I believe will prove most successful.
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In so far as it is necessary to have new political institutions, the Community should cherish rather than threaten the rich diversity of nations and regions within it.On external relationships, we must use all our influence within the Community to see that it is not just a magnet for new members, which it clearly is already, but an influence for global free trade and payments. If the Community can take constructive and urgent action, as my right hon. Friend the Member for Shoreham (Sir R. Luce) said, to bring the Uruguay round of the GATT negotiations to a successful conclusion, it will have done something of value for its members and the global economy generally. Assisting with the creation of a viable payments union in the area that used to be described as the Soviet Union would be the single most important contribution that the Twelve could make to that unstable and dangerous part of the world. By stabilising that part of the world, we would be making our contribution as a building block to better world monetary arrangements which will be important once the ecu is a means of exchange and a currency that can look the yen and the dollar in the face.
As my right hon. Friend the Prime Minister has said many times, we should work as hard as we can in the heart of Europe to lead our partners away from the cause of Euro-dirigism and Euro-protectionism, which if allowed to develop under the influence of Madame Cresson and such people would render the entire Community less competitive in global markets and blight the prospects of the developing countries to the south and east of the existing Community.
Once we have incorporated the Maastricht treaty into our law--presumably, as my right hon. Friend the Prime Minister said, in the first Session of the new Parliament--we must press on in the second half of 1992, when we have the presidency of the Community, to set out more clearly our vision of a common European future. In this brief speech, it is not appropriate for me to attempt that task but I shall give the House three examples of the sort of arrangements for which the Government should press in the second half of 1992 when we have an opportunity to carry them forward.
We should encourage a growing body of Community practice that builds upon the excellent subsidiarity article 3b in the Maastricht treaty. That is critical and I am delighted that it has found its way into the treaty with powerful German support. At a future review conference--such conferences will occur every few years in the Community--it might be desirable to go even further and press for a clause in the Community body of law that makes it crystal clear that all powers that are not specifically allocated to the Community should remain as of right with the member states, as is the case in the American constitution.
My right hon. Friend the Chancellor and his counterparts ably negotiated amendments in the documents on economic and monetary union. I should like to see Her Majesty's Government using all their influence in an attempt to ensure that article 104A is implemented to the letter. For hon. Members who are not conversant with every last article, that is the guarantee of a no- bail-out rule, which is important if we are to contain the development of economic and monetary union to sensible proportions. It will be vital if we are to ensure our objective of developing a European monetary union while
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retaining the bulk of fiscal powers unadulterated in national hands--in the hands of national Governments and Parliaments, where they should remain.I was struck by the words of Graham Bishop of Salomon Brothers in a recent publication on the importance of the no-bail-out rule. He said :
"The purpose of the rule is clear : It is the circuit breaker between monetary union and the back-door creation of a United States of Europe', where a centralised government takes control over domestic public expenditure as the price of a bail-out. If the rule is credible, EMU should involve only the lightest fiscal interference when budgetary policies are sound, because the debt of EMU members will be of the highest grade."
If we achieved such development of economic monetary union, we would be doing it on a sound basis.
I strongly welcome the text that was negotiated at Maastricht on the European system of central banks in stage 2 and the European bank in stage 3. Article 2 stresses the primary objective of price stability and article 7 enshrines the guaranteed independence of the European central bank. The full benefits of price stability and statutory independence for the European central bank, and indeed for the Bank of England--that must be a necessary institutional corollary--will be enjoyed only if a future Government and Parliament agree in good time to adopt a single European currency. In today's European capital markets, the freedom of exchange rates, to which some of my hon. Friends are so attached, means only the freedom to devalue--a course of action that would prove to be as futile as it is nugatory in modern conditions.
In a recent article in the Financial Times, Sam Brittan pointed out quite succinctly :
"At present the UK already has, as a member of the hard ERM, most of the obligations of a single currency without all the advantages. There would be little to be lost from going the whole hog." I agree with him, and there would be much to be gained at the appropriate time. The full benefits of a single currency will come through, which will benefit Britain and the entire Community. I hope that the Government will draw the logical conclusions and lessons from their earlier correct decisions and lead this country forward, at the appropriate time, to a single currency and ever- closer union of the peoples of Europe.
5.51 pm
Mr. Denis Healey (Leeds, East) : People have short memories, and it may be useful to remind the House that in 1972 President Pompidou announced on French television that there would be a European common currency by 31 December 1980. The Werner plan, from which that prediction was drawn, was wrecked by events outside Europe--the Nixon shocks and partly the effects of the OPEC increase in the oil price--but no hon. Member seems able to recall that it ever existed. Maastricht could suffer the same fate. I agree with hon. Members who have said that it may prove to be a major step towards the valuable goal of greater unity in Europe, but let us face the fact that it changes nothing in today's world. The summit did not even attempt to close any of the yawning gaps in the single market, which must come into effect at the end of next year. It simply agreed a timetable for producing a single currency by, at the latest, 1999--
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with or without Britain. Even in this area, nothing significant will change in the real world until phase 2 of European monetary union takes effect in 1994--more than two years from now.I want to start by asking what are the risks that the Delors plan--the origin of European economic and monetary union--will suffer the same fate as the Werner plan did 20 years ago. Let us remind ourselves, as the Prime Minister wisely did in his opening speech, that the Maastricht treaty does not come into force for more than 12 months--at the beginning of 1993--and only if every one of the 12 Governments who initialled it get it ratified by their Parliaments. The real debate is only beginning. As the Prime Minister said, only the British and Danish Parliaments have considered European monetary union, as it is now defined, or European political union. If we look at the initial response to Maastricht, the omens are not wholly encouraging. There is growing opposition in Germany to giving up the deutschmark without any real return in political union, which Chancellor Kohl had said was a precondition of moving to a single currency. I see from today's Financial Times that a leading member of the board of the Bundesbank said yesterday that the Maastricht summit was a failure and might prove to be "a suicidal
failure"--serious words from a key member of the body that drew up the detailed proposals for European economic and monetary union. I cannot resist the feeling that the Government's extraordinary surrender yesterday to German bullying over the recognition of Croatia had something to do with the need to appease German public opinion, which is turning nasty on the whole process--or perhaps it was just sucking up to the right hon. Member for Finchley (Mrs. Thatcher), who has succeeded in abandoning her resistance to German blandishments and has formed a common front with Chancellor Kohl in demanding the immediate and unconditional recognition of Croatia. But then, it is, of course, a funny old world.
French ratification is little more certain, because the extreme right, under Le Pen, is campaigning hard against what it inelegantly calls the "federasts" of the European movement. Le Pen may succeed in winning allies on this issue from the more moderate right wing, as he already has on the issue of immigration and race in France, which is a depressing prospect.
The ratification of the Mediterranean countries is no more certain. The Spanish Prime Minister has already said--it was said also by the Portugese at Maastricht--that their ratification will depend on more money for what is called cohesion and structural funds. They are talking of sums far higher than France, Germany or Britain seem prepared to provide. I am interested to see that the Minister of State, Foreign and Commonwealth Office, with his deep knowledge of the Spanish people and countryside, seems to agree with me on that. But the biggest challenges to Maastricht will come, as they came to the Werner plan, in developments outside the European Community. It is clear that almost all the European Free Trade Association countries, except perhaps Iceland, will want to join the Community. They will probably all be members well before 1996, which is the earliest date for phase 3 of EMU. That will mean an enormous shift in the centre of gravity in Europe towards the north--something that we in Britain should heartily
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welcome, because on many issues, our approach, or at least, that of Labour Members, has much in common with the countries of northern Europe.If things go well, it seems that, certainly by the end of the century if not by the earlier date of 1997, it may be possible to form a single currency to which Germany, France, the Benelux countries, Denmark and the EFTA countries will belong. In such a case, it seems inconceivable and well nigh insane to imagine that Britain would stand out. All of us must have been deeply disturbed by the Chancellor's refusal to answer the question this afternoon--yes, we agree that Parliament must take the final decision, but what decision will he recommend in those circumstances?
Mr. Giles Radice (Durham, North) : He does not know.
Mr. Healey : He knows very well, because he is against a single currency in principle, like his predecessor, the right hon. Member for Blaby (Mr. Lawson), who clearly expressed his views--which, I think, are shared by the present Chancellor--in an article in one of the tabloid newspapers. I believe it was the Evening Standard.
Mr. Radice : My right hon. Friend referred to the Chancellor's views but, when we asked him that question in the Select Committee, it became clear that he was not so much against it in principle as uncertain in his own mind what he should do.
Mr. Tony Banks : Sounds like a Liberal.
Mr. Healey : He does sound like a Liberal, but I do not like to explore the murky recesses of the Chancellor's mind. However, I must confess that his failure to give an answer--even that answer--to the question this afternoon was very significant.
The EFTA countries are not alone. I agree with all the right hon. and hon. Members who said--I think that almost all who have spoken so far made this point--that it is very important to give Czechoslovakia, Hungary and Poland the prospect of joining the Community at least by the end of the decade, and to give them every possible assistance in meeting the economic and political conditions for membership as soon as possible.
Of course, that will mean a big shift of gravity inside the Community to the east. By the end of the decade, power will have shifted to central and north-east Europe from its present location, which I suppose is somewhere between London, France and Rome.
Mr. Tony Marlow (Northampton, North) : And Berlin.
Mr. Healey : I accept that, although I gather that even the German Parliament is deeply divided on how much of it and how much of the Government should move from Bonn to Berlin.
I think that the biggest challenges to the Maastricht process will come, as they did before, from outside Europe. The United States is clearly already becoming much more self-centred. If, partly because of Europe's obduracy over the common agricultural policy, the GATT talks break down, the process of disengagement from external responsibilities may move very much faster than anyone expects or hopes, both from Europe and from the west Pacific area.
The most important single factor is the disappearance of the Soviet Union from the world stage. Lenin, who does not often get a kind word these days, was right in at least
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one of his prophecies. He prophesied that the triumph of communism would lead to the withering away of the state. I do not think that anyone has ever seen a state wither away quite as fast as the Soviet state has in recent weeks.However, the disappearance of the Soviet Union will have very disturbing consequences. It has been replaced by a commonwealth of independent states. If, as I believe, NATO is a biological monstrosity because it is an organ without a function, the commonwealth of independent states is a political nightmare because it is a function without an organ. It has, at the moment, absolutely no institutions through which to express itself.
It is worth remembering the lessons--even the recent lessons--of history. The disintegration of the European empires after the last war was followed by 45 years of armed conflict in the ex-colonies, in which 20 million people died in the far east, in the Indian subcontinent, in the middle east, in Africa and even in the Caribbean. All those factors are likely to be at work now that the Soviet empire has disintegrated.
Even worse, the European empires at least left behind them working administrative structures and moderately healthy economies, which meant that most of the ex-colonial countries have managed to maintain stable states and thriving economies--although, of course, not thriving as fast as ours in the west--but the Soviet empire is leaving no administration at all, only economic catastrophe.
It is often said that it is not very easy to turn an omelette back into eggs. Since the perestroika process began, the Soviet economy has followed a steady course downwards, and there seems no prospect at the moment of it reversing that process. We shall all be watching the success of Mr. Yeltsin's programme to form a judgment on it, if it is introduced in January.
If economic catastrophe is added to the political disintegration, the consequences for Europe could be dire, not only in terms of the millions of refugees who are already predicted, but possibly through the sale of nuclear weapons to any body of people or any Government in the third world or elsewhere who have the hard currency to pay for them.
I do not believe in a nuclear civil war in the Soviet Union--I think that Nazarbaev and Krawczuk want to hang on to their nuclear weapons as a defence against a Russian attack. I do not think that they have any intention of using them--nor have the Russians--but the risk that, as the system disintegrates, people may simply sell off the smaller nuclear weapons is a real one. I was glad that that was recognised by Mr. Baker on his recent visit to the Soviet Union. They pose enormous threats to western Europe and more immediate threats to eastern Europe, but there is still no obvious way in which the west can help to avoid the consequences until there is at least some clarity about where authority lies in the Soviet Union.
I agree with the hon. Member for Carshalton and Wallington (Mr. Forman) that by far the most useful thing that we could do in the short run would be to fund a payments union among the commonwealth of independent states so that they could at least have a currency in which to trade with one another.
Against that background--I doubt whether many hon. Members would dispute the dangers that I have outlined--the argument about who won at Maastricht is pitifully irrelevant. Maastricht was not a triumph for any Government, although each of the Governments present
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