House of Commons Hansard Debates for 24 Nov 1992

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We had an amusing debate last week in the European Standing Committee about Hogmanay haddock. For the benefit of hon. Members, I will explain. These are haddock which, according to the official explanation, do not exist ; they cannot exist because the quota system says that they do not exist, but miraculously they will materialise on 1 January when the quota will be doubled and we will be moving from a shortage to a glut. Common sense tells us that these will be the self-same haddock, but to fulfil the requirements of the quota policy, the fishermen are not allowed legally to land the haddock at present. Therefore, thousands of jobs in the fishing industry in Scotland will be subject to dislocation over the next five weeks and there will be a very bleak Christmas for many families in the fishing communities.

Dr. Godman : May I point out to the hon. Gentleman that many of my constituents believe that it is a heinous sin to discard the fish and that it is much better to sell them on the black market, even if that is illegal under European Community rules?

Mr. Salmond : It would be extremely difficult to argue that the discarding of fish dead into the North sea represents any sort of a conservation policy.

The burden of my remarks is to suggest a solution to the problem. The Foreign Secretary told us about Euro-myths. He has even published a booklet to help hon. Members to understand that many of the things we hear about the European Community are not the fault of the Community but myths spread in the press and elsewhere which bring the Community into disrepute. I suggest that it is not the Euro-myths which bring the Community into disrepute but the actions and inactions of United Kingdom Ministers who fail to pursue proper negotiations within the European Community.

What should have been proposed to the Fisheries Council yesterday by the two Ministers representing the United Kingdom was a simple mechanism of borrowing forward on next year's haddock quota to solve the immediate problem and not jeopardise the long-term stability of the industry. There was precedent for such a proposal because other countries have used that exigency in the past. A vital national interest was at stake, certainly for Scotland. It is not just that 78 per cent. of the haddock caught in the North sea are part of the United Kingdom quota ; the important point is that no other member state has the same vested interest in the haddock quota as the United Kingdom, and particularly Scotland. Therefore, no one had a vested interest in stopping an adjustment of the quota.

Within the Commission documents proposing the review of the fisheries policy there is a move away from annual quotas to multi-annual quotas. Therefore, there would not even have been a damaging precedent set for annual quotas, because they will disappear under the proposals of the Commission.

It would have been bad enough if Fisheries Ministers, with that wealth of argument at their disposal, had come back and told the House that they had tried but failed, but the reality of what happened in Brussels yesterday is that the issue was not even placed on the agenda by the Scottish Fisheries Minister representing the United Kingdom in negotiations. Therefore, I hope that hon. Members will

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understand the present anger in fishing communities in Scotland at the total dereliction of duty by the Scottish Fisheries Minister, the Under-Secretary of State for Scotland.

May I now generalise from the particular. What does that example of the confusion and chaos in fisheries policy tell us? Is it a result of the common fisheries policy itself or a result of the negotiators from the United Kingdom not having enough interest in the subject to secure the common-sense solution that was available for the fishing communities? Is it an example of where subsidiarity might have applied?

There is more than enough reason to believe that the Scottish Fisheries Minister is a nice man, but has no power because he is overruled by his ministerial superior in the Ministry of Agriculture, Fisheries and Food. Certainly it is an example of where there would have been a different outcome if Scotland were an independent state within the Community. No genuine Scottish Fisheries Minister could have survived in post after having so signally failed to raise an issue of such importance at the relevant Council meeting. I was somewhat stung earlier by the Foreign Secretary telling me that I have an old-fashioned view of the EC. I think that I have a modern view of the EC. I may have an old-fashioned view of politics. I think that Scottish Office Ministers should try to defend the interests of the industries for which they are responsible. I was stung because I cannot think of an hon. Member who is more Edwardian in his approach to politics than the Foreign Secretary. If ever there was an hon. Member who was born after his time, it is the Foreign Secretary.

The Foreign Secretary, in that way of his, waved his hand and told us to consult the documents supplied to the House and the principle of subsidiarity from the Commission. Many of us have consulted just those documents to find the following description ;

"This common sense principle therefore dictates that decisions should be taken at the level closest to the ordinary citizen and that action taken by the upper echelons of the body politic should be limited."

It goes on to say that the first application of that political principle of subsidiarity is in many cases within the states of the EC itself.

The essential hypocrisy of the Government's attitude to subsidiarity is that they believe that the principle can be applied to the relationship between the United Kingdom and our European partners without the same principle being applied within the United Kingdom. On that point of hypocrisy, I suspect that the Foreign Secretary, come the Edinburgh summit, may find that it is not "Scotch on the Rocks" but a Prime Minister and Foreign Secretary on the rocks.

7.52 pm

Mrs. Edwina Currie (Derbyshire, South) : First, I add my congratulations to those of a number of hon. Members on the Government's success in the GATT agreement. More than anything else that we might do at the moment, the successful conclusion of those five years of negotiation, involving 108 countries and 28 different agreements, will do more for world trade and prosperity than almost anything else that we might do. If that is the only success of our six months' presidency of the EC, it is a substantial success, and one to which we shall look back in time to come with much gratitude.

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I also join my hon. and learned Friend the Member for Perth and Kinross (Sir N. Fairbairn), who has clearly found something else to do at 8 o'clock in the evening, in his protest about the papers. Every hon. Member who has gone to the Vote Office to collect that great heap that is now sitting on the Table has grimaced at seeing it. However, anyone who has ever seen the monthly papers that come out of Derbyshire county council would not be in the least surprised at that quantity of paper, bearing in mind that, for every person employed by the European Commission on any of its budgets, Derbyshire county council employs two in Matlock, and very few of us can see exactly what they get up to.

A great deal of that paper has been around for a very long time, and much of it was written in London. The most incomprehensible chunk of all was written in Her Majesty's Treasury. The explanatory memorandum on the transfer of administrative appropriations says : "Attached to the paper are a number of annexes covering a breakdown of outside (non-statutory) staff ; the criteria for converting appropriations to posts (and for the continued use of outside staff) ; the technical procedures to be used to incorporate administrative appropriations from Part B into Part A of the budget ; and criteria for distinguishing between appropriations for studies, consultants, meetings, conferences, information and publications, which are to be transferred to Part A, and those likely to remain in Part B of the Commission's Budget."

This is an explanatory memorandum. The subject is transparency of management. If that is an explanatory memorandum, it is no good. Most of the other stuff produced by the Treasury is in the same form. The explanatory memoranda produced by the Foreign and Commonwealth Office are much better and clearer and I commend their style to my colleagues in the Exchequer. Such documents appear to be written by someone with English as his third language.

Mr. Ian Taylor : Will my hon. Friend help the House by reading that for the record in the other Community languages, in which I am sure it will sound much better?

Mrs. Currie : I would like to bet that it is comprehensible in French, but it is not comprehensible in English, and it should be. If we are to be presented with explanatory memoranda to assist us in debating these important matters, I hope that they will be much clearer in future.

Those hon. Members, particularly Conservative Members, who have said that we should face our future in Europe with resolute, determined and positive attitudes are right. We should see the challenges that face us not as unpleasant or unacceptable, although they are difficult, but as opportunities. We should ensure that we in the United Kingdom benefit by taking advantage of those opportunities, particularly on trade.

I speak from a strong position in south Derbyshire, because the Toyota factory will soon be starting production in my constituency. It is a remarkable achievement to open a new factory so fast and with a brand new model, the Carina E--E for Europe--a redesigned model intended for the European market. That is a tremendous credit to all concerned.

Toyota is here because we are in Europe. It would not be in the United Kingdom if we were not an active and full member of the Community. It is here because, within the Community, the United Kingdom presents the most attractive business environment, with our low taxation

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policy, few restrictions on business and our refusal to accept the social charter. We are very much at the heart of Europe.

Ms. Joyce Quin (Gateshead, East) : Has the hon. Lady seen the recent report by Ernst and Young, which says that there are some worries among would-be investors in the United Kingdom because we now seem somewhat semi- detached from the rest of Europe, and because of the double opt-out in Maastricht there is a question mark over investment? As my hon. Friend the Member for Copeland (Dr. Cunningham) said earlier, investment has dropped.

Mrs. Currie : Worries about the United Kingdom becoming semi- detached or being in any way half-hearted are a reflection of small majorities in the House. If the hon. Lady and her hon. Friends feel that way, they should be voting with us on every aspect of the European Communities (Amendment) Bill and ensuring that we have the thumping big majorities that we had on Second Reading which this country needs.

Toyota is in the United Kingdom not only because we are in Europe but because of the British approach to international business which has made such companies more welcome, unlike the French, who have spoken in hostile terms about the Japanese, and unlike the trade unions, who have called their practices alien, a comment which rankles, and which continues to hurt them.

We fought for Toyota's cars to be accepted as British and European. When I say "we", I mean that I fought for them. I went to Strasbourg. Our European Member of Parliament, the hon. Member for Stoke-on-Trent, South (Mr. Stevenson), who is not in the House at the

moment--goodness knows where he has got to--did not fight for them. The Labour Member of the European Parliament who sits for Dagenham was responsible for the proposal that Japanese vehicles built in this country would have counted as Japanese and as imports. I was pleased that I was able to go, and that we were able to have that policy thrown out.

Such action is part and parcel of meeting the challenges and of welcoming outside stimuli to this country--rather that than sit on our backsides and moan about the difficulties. Most of all, as a nation we must get out and sell not only our products but ourselves and our communities.

There are huge benefits in adopting that attitude. Toyota now employs 1,000 people in my constituency, the unemployment rate in which was 6.7 per cent. in October and falling. Of the 10 Derbyshire constituencies, unemployment is falling in six and static in three. Unemployment is rising only in the constituency of the hon. Member for Bolsover (Mr. Skinner). The fastest fall in unemployment last month was in the constituency of the hon. Member for Derby, South (Mrs. Beckett)--but you would not hear her say that.

That improvement is partly due to the impact not only of Toyota but of other locally based international businesses such as Nestle , Pirelli, Asea Brown Boveri, Stanton--which is now owned by St. Gobain--and GeGa Lotz, a German company. Unemployment has also fallen nearby in Burton-on-Trent and north-west Leicestershire.

Derbyshire could have retained--as several hon. Members suggested--the dominance of old, nationalised, subsidised and protected industries. It could have begged for subsidies, but it never has done so. South Derbyshire does not receive subsidies, enjoy special status, or get

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grants. We do not want grants, believing that draws attention to problems rather than to the opportunities for inward investors and business people.

Derbyshire chose instead to cultivate international businesses as the motor heart of Europe, and it did so. I will not mislead the House--the transition was painful, but very worthwhile, and I commend it. I would like to see the same positive attitude pervade the rest of our great trading nation--and that must start with the Government. If they are concerned about the negative tone of some of their supporters--a tiny minority in the House--they must consider whether they have only themselves to blame.

Every time that Maastricht or some other European policy is presented in a negative way, a few more decide against it. If we talk about subsidiarity not as an essential clarification and strengthening of the relationships between nations and central organisations but in negative terms--as "restricting the powers of faceless bureaucrats" or "the centralising tendencies of the Brussels machine"--which is the phrase used by my right hon. Friend the Secretary of State--the Government should not be surprised if a few of my right hon. and hon. Friends say, "We hear you, John. We are with you, Douglas. We will vote against the lot."

If every effort to bring down invisible trade barriers is portrayed as Brussels bureaucrats interfering in the noise emitted by lawnmowers or motor bikes, of course some commentators will think that the whole thing is a pettifogging waste of time. Lawnmowers are made in my area, and we needed to bring down those invisible trade barriers. I regard it as insulting that that aspect--which resulted in a success in enabling and improving trade for this country--appeared in the Foreign Office booklet "Euromyths". I received an apology, but I hope that reference will be removed in the next edition and that it will instead concentrate on successes.

I am proud to be a founder member of a group of Conservative Back Benchers who are positive Europeans, and who numbered 75 at the count yesterday. We outnumber the sceptics two to one, and are otherwise known as "Whitney's wonders" after my hon. Friend the Member for Wycombe (Mr. Whitney), who is not in his place at the moment, and who yesterday was elected as our chairman. I pay tribute to him and to my hon. Friend the Member for Esher (Mr. Taylor) for calling that group together.

We urge the Government to get on with the Maastricht Bill and to secure its Third Reading as soon as possible--certainly by May--and not link it to whatever goes on in Denmark or anywhere else.

Why should this proud nation hide behind any other country? Why should our country even dream of being the last in Europe to ratify the Maastricht treaty--particularly when the treaty that we are now debating and discussing is different from, and better than, that achieved by other nations--who are jolly envious.

I urge the Government to be altogether more positive about Europe from here on in. If I may phrase this in the double negative style that seems to float around Front Benches, I beg the Government not to forget that they should not get so bogged down in the detail that they ignore the necessity of explaining to the British people and the House the broad thrust of what they are trying to

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achieve and their objectives. With all the talk of budgetary discipline, auditors, subsidiarity and the rest, we are trying to build a Europe that is strong, competent, and free.

I urge the Government not to get so hung up on the problems that currently face the Community that they fail to promote and to draw attention to the Community's hugely beneficial benefits, of which my constituency has concrete evidence right now. Those benefits are the fruits of previous changes fought through the House, such as the Single European Act, which in retrospect were enormously helpful. The results that they brought in my own area are leading to growth and prosperity--the like of which we have never seen. I commend those thoughts to the House.

8.5 pm

Mr. Geoffrey Hoon (Ashfield) : It is one of those nice ironies of parliamentary life that I follow the hon. Member for Derbyshire, South (Mrs. Currie), because in due course I shall be leaving the European Parliament to concentrate on my work in the House, whereas I understand that the hon. Lady is about to abandon her constituents for the prospect of a seat in the European Parliament.

Mrs. Edwina Currie : I am going the right way.

Mr. Hoon : The hon. Lady will at least be able to fight for her constituents, wherever they may be, from the Floor of the European Parliament--rather than from its gallery, where she did her fighting on behalf of Toyota. In any event, I wish the hon. Lady every success in her efforts to secure a candidature, but I warn her that the present opinion polls do not look particularly favourable for Conservative candidates for the European elections in 1994. Rarely has any presidency of the European Community been subject to so much criticism as that of the present British leadership. Usually, disappointment with the performance of any country's presidency is expressed only at the end of the six-month term of office-- and then only in muted diplomatic niceties about the numbers of directives passed or agreements reached. Sadly, we have open, clear, and condign criticism of the British Government's handling of a series of Community issues.

Central to those issues are the related budgetary and financial questions which are the essential subject matter of today's debate. The Government consistently criticise the way in which the Community spends its income, so it was not unreasonable to expect during the British presidency evidence from the Government that they are sorting out the interlocking difficulties currently on the agenda of the Community's Finance Ministers.

The 1993 Community budget appears to be heading for considerable difficulty because of the wide gap between the Council's position--after the ruthless cuts in the Commission's draft budget, in which the British Government lead the way--and that evident in amendments tabled by the European Parliament. Many analysts suggest that that will lead to the budget being rejected, the collapse of the budgetary process and further difficulty for the United Kingdom presidency.

Other issues include continuing discussion about the Delors 2 package, particularly in the light of its recent revision by the Commission, and negotiations for a new inter-institutional agreement to replace that which lapses at the end of this year.

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I shall deal first with the 1993 budget. It is not clear whether the British Government have accepted the arguments in favour of a real strategy for European growth backed by funds from the European Community budget. If the British Government endorsed such a strategy, that must have been received by European Finance Ministers with a mixture of amusement and incredulity as those same Finance Ministers have heard British Governments consistently oppose and even refuse to discuss plans for employment and economic growth throughout the European Community. We understand that until recently the British Government even opposed the idea of economic growth being a separate item on the agenda for the Edinburgh summit.

Perhaps we are right to remain cautious about the prospects of some blinding conversion on the road to Brussels for our Government. After all, during consideration of the 1993 draft Community budget the British Government led the Council of Ministers into a series of deep cuts in expenditure on the very programmes which could form the core of any European package for recovery and growth.

The British Government have cut at least £2.8 billion from the total budget set out by the European Commission. It is interesting to measure what has been reported about the Government's so-called commitment to European economic recovery against the individual items in the draft budget which they and their colleagues in the Council of Ministers have cut. The Government have cut £240 million from regional and social spending. Previously, under a series of different presidencies, regional and social spending was generally left untouched. The Government, however, think it appropriate to cut £240 million off the Community's budget for regional and social spending. The Government have cut £320 million off the Commission's figures for research spending at a time when almost everyone accepts the importance of further research to enable European industry to be truly competitive, especially in relation to far eastern countries. If we are to be competitive in new technology and electronics, we need the research spending that has been cut by the Council of Ministers.

A further £160 million has been cut from a series of projects covering education and training, environment policy and consumer protection, all of which are vital to the continuing health of the European economy.

I shall make a comment about one other area of council cuts in the light of the Foreign Secretary's opening statement. He waxed rather lyrical about the need for openness in the European Community. He spoke about the need for information about Europe and for the people of Europe to understand the European process. Unfortunately, his remarks about openness and information must be measured against the determination of his Government to preside over a cut of almost 50 per cent. in the European Commission's information budget. That is hardly an appropriate way to ensure that the people of Europe become more informed about the processes of the European Community. The Council of Ministers has slashed the proposed cohesion fund from £1.25 billion to zero. That money was aimed precisely at the growth and convergence which the Government say that the Community neeeds. The money was promised as the price of agreement over Maastricht. It is compensation for the poorer outlying areas of the

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European Community and the centralising tendency of Maastricht. Of course, the money is an essential part of the Delors 2 package which has been revised by the European Commission.

Mr. Milligan : The hon. Gentleman is complaining about the cohesion fund. Is he aware that the cohesion fund cannot be set up until the Maastricht treaty is ratified because it is part of the treaty? If he wants to see the fund set up, the best way to do that is to persuade his Front Bench to give full support to the ratification of the Maastricht treaty.

Mr. Hoon : I am grateful for that observation. I anticipate that the position of the Labour party on the constitutional process of ratifying the Maastricht treaty will remain very much what it was on Second Reading. We shall not be diverted in the way in which the Government want us to be diverted--along paths established solely for the benefit of the Conservative party to paper over the deep cracks that have emerged in that party.

We want to see a cohesion fund as part of the Maastricht agreement. Clearly, we also want to see a policy for the European Community which emphasises not just centralisation but the contribution that can be made to the Community by all of the countries working together equally. That is why we have considerable sympathy for the Delors 2 package, which is the second subject that the Government must address.

What is the Government's position now, in the light of the revision of the Delors 2 package which has been agreed by the European Commission? The Government have wanted consistently to provide a longer-term perspective for European Community financing. The reaction that the Commission have consistently had from the Government is scorn. The Government have consistently rubbished the efforts of the European Commission to put the enlargement of the Community into perspective and provide assistance to eastern Europe at a time when they are saying that economic development in eastern Europe and enlargement of the European Community would be a good thing. Yet when the Government are faced with proposals to implement those principles they suddenly find that they cannot go along with them.

So there is a matter on which it would be possible for the Government, leading the European Community in the way in which the hon. Member for Derbyshire, South advocated, to put into practice the leadership of Europe that is so vital. It is necessary to have extra money to enable countries to develop and to enable areas which have only recently been released from totalitarian Governments to develop economies of the sort which I assume that the hon. Member for Derbyshire, South wants to see. Extra funds can be made available only if there is a commitment by countries such as the United Kingdom and other countries in the European Community.

The European Commission has backed down considerably in its original programme for the cohesion fund. It backed down in a way which is, frankly, unlikely to find favour with the European Parliament. The European Parliament has stressed the need for a substantial increase in that part of the Community budget which is available for eastern Europe and development. It has also stressed the importance of making more of the present Community budget available for internal policies. It remains to be seen whether the Commission's revision of the cohesion fund

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will find favour with the European Parliament. That is where the Council and the British Government need to direct their arguments in the budgetary process. They need to find an agreement which will satisfy the European Parliament.

The Council and the British Government must satisfy the European Parliament with a new inter-institutional agreement. The 1988 guidelines lapse at the end of 1992, at the end of the British presidency. Therefore, it would have been sensible, and one could have expected the British presidency to be well under way in the process of reaching a new inter-institutional agreement for 1993 and the years beyond. Sadly, however, that appears to be far from the case. The negotiations involving the Council, the Commission and the Parliament seem to have made modest progress to date. There is a meeting tomorrow between the Council and members of the parliamentary budget committee, but no one is confident that any real agreement will result from the meeting or, indeed, that any agreement will be reached before the end of the financial year.

A new inter-institutional agreement is a priority for the Commission and the European Parliament. It remains to be seen whether a new agreement is a real priority for the Council. Without a commitment to the Delors 2 package as part of the arrangement, an agreement is unlikely to find favour with either the European Commission or the European Parliament.

The package must involve measures to improve the industrial competitiveness of the European Community. As the Foreign Secretary said earlier, it must involve the development of trans-European networks in transport, telecommunications and energy. However, those policies need funding to make them work. So far, the Government have been strong on saying that the ideas are good but extraordinarily weak on putting into place the financial support which could make them happen.

Those are precisely the areas which have been hit hardest by the Council's revision of the Commission's draft budget for 1993. It is extraordinarily difficult to take seriously the suggestion by Conservative Members that the present Government are deeply committed to the European Community ; given an opportunity to demonstrate that commitment in the context of the 1993 budget debate, the Government ducked the responsibility.

I want to see real leadership from the British Government in relation to the financial and budgetary difficulties faced by the Community. They could use their presidency to sort out clearly, on behalf of the Council, problems whose solution would gain them widespread support across the Community. I suggest a modest package of measures which would go a long way towards resolving the three main areas of difficulty.

First, there should be an agreement on the cohesion fund, and a doubling of the structural funds, to provide employment and training across the Community. Secondly, there should be a restructuring programme to take account of the employment consequences of cuts in defence spending. Thirdly, there should be a programme to ensure improvements in vocational training across the Community. Finally, there should be a commitment to the Community's responsibility to the countries of eastern

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Europe--and, indeed, those of the developing world--at the level suggested by the Commission in its draft 1993 budget.

If the Government have the courage and conviction to adopt such a straightforward and sensible package, their present difficulties within the Community will disappear. The package would appeal to the European Parliament and would lead to a swift settlement of any difficulties remaining over the 1993 budget ; it would endorse the main elements of the Delors 2 package ; and it would set in place the building blocks for a new inter-institutional agreement. That would be a real achievement for the British presidency in its six months. 8.21 pm

Mr. Stephen Milligan (Eastleigh) : By and large, Opposition Members' speeches have been couched in constituency terms, and that of the hon. Member for Ashfield (Mr. Hoon) was no exception. They have contained pleas for more help for steel, shipbuilding, fisheries or regions. Taken together, however, they carry a clear message--that there should be higher public spending and higher borrowing. I do not believe that that would work in Europe, for the same reason that it would not work in this country : it would mean higher taxation and higher interest rates. Such an approach is not the best way in which to create jobs ; it is the best way in which to stop recovery in its tracks.

The hon. Member for Copeland (Dr. Cunningham) heaped on the Government much abuse for what he said that they had failed to do during the British presidency. He said, for example, that they had failed to deal with the problem of unemployment. It is a bit rich to hold the British presidency responsible for rising unemployment across Europe. The hon. Gentleman does not seem to have noticed that unemployment is also rising in Japan, the United States and, indeed, every industrialised country in the world.

Perhaps the hon. Gentleman has forgotten what happened under the last Labour presidency of the Community, which I had the misfortune to witness as a journalist in Brussels. It is difficult to remember a time when this country was more unpopular in Europe. Hon. Members may recall the time in the 1970s when a Labour Government opposed direct elections to the European Parliament, and opposed not just our joining the European monetary system but the very creation of that system. Then, Labour was opposed to a common energy policy--and, of course, it faced economic catastrophe at home. I do not think that comparisons based on presidential success befit Labour Members. I believe that today we have some reason to be proud of our achievements in Europe, if we consider those achievements over a longer period. When we joined the European Community, we joined a Community which was primarily agricultural, paying very high prices to prop up French and German farmers. We joined paying a wholly disproportionate amount into the European budget. Now, that Community is slowly but surely changing : in the six months of the British presidency, a number of significant alterations have been made. First, there has been a change in the budget. Under the leadership of my noble Friend Baroness Thatcher, we made significant reductions in the British contribution, amounting to £14 billion over the period concerned. I

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consider it vital that the British abatement is maintained, but I also think it important for us to resist excessive public spending of the kind proposed in the Delors 2 package. Someone must pay for it : it is not a free ride.

It is significant that, when British Ministers talk of excessive spending, waste and fraud in the Community, they now have allies--most notably the Germans. I was surprised to hear the hon. Member for Ross and Cromarty (Mr. Kennedy) say, when challenged on who should pay more towards regional spending, that he thought that Britain was not paying enough into the European budget.

Mr. Kennedy rose--

Mr. Milligan : Perhaps the hon. Gentleman would like to explain.

Mr. Kennedy : On a point of fact, I am the Member of Parliament for Ross, Cromarty and Skye ; but let us leave aside that particular principle of additionality. I was merely making the point that, when it comes to nation state contributions, this country has constantly abused the principle of additionality by replacing projects that would otherwise have gone ahead, and making them additional in the eyes of the Commission. I was criticising the way in which the system has been operated by the Treasury, both historically and currently.

Mr. Milligan : I am delighted to hear that clarification. I take it that the hon. Gentleman thinks that we are not paying enough, and also thinks that we should reduce the amount that we pay to the Community budget!

Incidentally, it is an unhappy fact that our gross national product is now below 90 per cent. of the Community average, which will make us eligible for payments under the cohesion fund if the Maastricht treaty goes through. I hope that Ministers will not be too timid in applying the fund. It may be embarrassing that our GNP is below 90 per cent. of the average, but, if there is money for Britain, I hope that we shall put in for it.

Secondly, there has been reform of the common agricultural policy. We have made great strides in the past few years, mainly because of the freeze in prices, the introduction of quotas and the reduction of agricultural output ; but I believe that the GATT agreement will constitute a decisive step towards CAP reform.

Then there is enlargement. We are now quite close to an agreement to admit Austria, Sweden and Finland, and--I hope--eastern European countries soon after that. The sooner that we ratify the Maastricht treaty in the House, the sooner we can begin enlargement negotiations. As the first three countries to join will be net contributors to the budget, this country has a direct financial interest in their joining as soon as possible--which is a further reason for our ratifying sooner rather than later.

The concept of the single market is very much a British concept, to which Lord Cockfield contributed in particular. It is about to become a reality in January.

Finally, there is subsidiarity--a new idea, developed over the past 18 months, which is very much in harmony with the traditional British idea of trying to reduce the influence of bureaucrats and to decentralise the Community.

I believe that subsidiarity is the key to why the Maastricht treaty should be ratified. Many hon. Members have asked what it actually means : is it legally enforceable? There are some doubts about whether a few paragraphs in

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the treaty are clear. If hon. Members want to understand what subsidiarity really means, they should go to Brussels, and visit the Commission and the various delegations--as I did a couple of months ago with my hon. Friend the Member for City of Chester (Mr. Brandreth). They will be amazed at the change in attitude among national delegations. It is no longer just the British, the Danes and the French who are canvassing for subsidiarity ; the Germans are doing the same. As my right hon. Friend the Foreign Secretary pointed out, Chancellor Kohl has now strongly embraced the concept, and is actively campaigning in favour of it.

If hon. Members visit the Commission building, they will find that the number of propositions for Community law has been reduced by two thirds. I pay tribute to Jacques Delors. I know that that may seem heresy to some of my hon. Friends--

Mr. Whitney : They have all gone to dinner.

Mr. Milligan : I am happy to hear it.

In the past 12 months, Mr. Delors has radically changed the Commission's approach, and has demanded that every proposal that comes to his desk should have a piece of paper attached to it explaining why the proposal should be dealt with at European rather than national level. That is one reason why the number of proposals has dramatically declined.

Mr. Delors has also made one decision that my constituents particularly appreciate. Hon. Members may remember the dispute about the completion of the M3 at Twyford down, and the Commission's suggestion that it knew better than the British Government which side of St. Catherine's hill the motorway should go. I accept that the Commission and the Council have a right to interfere in environment policy if we are producing acid rain by pumping sulphur dioxide into our atmosphere, but it is absurd for the Community to try to decide matters such as the route for the M3. I pay tribute to Mr. Delors for withdrawing the Commission's intervention, in the new spirit of subsidiarity.

I hope that we shall make further progress on subsidiarity at the Edinburgh summit--that we shall put flesh on the bones. In particular, I hope that there will be a hit list of directives that are to be repealed. I hope, too, that there will be a new Council procedure to enable people to blow the whistle on an unnecessary directive at any point in the discussions and that there will be a clearer definition of how subsidiarity might apply.

Niggling regulations are, I believe, irritating our constituents. Most people in this country accept that, when we are dealing with a problem such as Yugoslavia or currency movements it is right to do so on a European scale, but they cannot accept niggling intervention in what my right hon. Friend the Home Secretary called the nooks and crannies of public life. If we cannot put flesh on the bones of subsidiarity, it will make an enormous difference to public opinion. We must be careful, however, not to take the principle of subsidiarity too far. Britain has an interest in interference in certain areas. If money spent by the Community is wasted, or it olive tree growers in Italy indulge in fraud, we want Commission officials to interfere. If there is protectionism inside the internal market, with the result that the French or the Greeks are

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keeping British goods out of their countries for no good reason, we want the Commission to interfere. Subsidiarity, therefore, need to be defined carefully.

The best definition of subsidiarity is that the Community should take action when problems of great significance cross national borders. Recently, the Government put forward a proposition to harmonise the rules on the vaccination of racing pigeons. One has to admit that racing pigeons cross borders, but it is not a significant issue. Although there may be issues on which it is thought that action is needed, there is no common Community interest there.

Mrs. Currie : I understand that in some parts of the country that lie further north than my hon. Friend's constituency, the export of first- class racing pigeons is an important trade.

Mr. Milligan : I defer to my hon. Friend's great knowledge and I appreciate that what she says is correct, but I believe that exports could continue without there having to be common rules on the vaccination of racing pigeons.

My hon. Friend referred earlier to lawnmowers. That is a very good example of what I mean. When I worked as a journalist in Brussels, there was a story that the Commission was trying to harmonise the noise made by lawnmowers. Everybody roared with laughter and said, "What could be more absurd? This is a parody and amounts to unnecessary Commission interference."

Three weeks later I had to write an aritcle about barriers to British exports. I telephoned the Confederation of British Industry and said, "Can you give me a practical example of a barrier to British exports on which the Community ought to be taking action?" The reply was, "Yes, lawnmowers. The rules in Germany are so designed that noise can be emitted only by German-made lawnmowers. If we are ever to sell British lawnmowers in Germany, we need to harmonise the rules." Absurd rules can be of no practical advantage to this country. We need to define subsidiarity carefully so that we do not prevent the making of rules and regulations that would greatly benefit this country.

The Edinburgh summit will have a heavy agenda. It will be an enormous success if it can get through half the agenda. Subsidiarity is the key to success. If we can reach agreement on subsidiarity, the British presidency will end not with a whimper but with a triumph. 8.23 pm

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