| Previous Section | Home Page |
The Chancellor of the Exchequer (Mr. Norman Lamont) : The hon. Gentleman is quite wrong. We are not prepared to accept a change in it.
Mr. Smith : That contradicts the references earlier to the way being open for technical change. When does technical change become a concession of substance? That is a matter to which we shall return. On a wider macro- economic policies for the Community, the Government seem to be groping their way around another rather murky S-bend. They are reported to be considering proposals for the Edinburgh summit.
I return to yesterday's The Daily Telegraph, in which Downing street was reported to have said :
"Our aim is to extend the British strategy for recovery across Europe."
That will really have them dancing in the streets of Naples. We and our European partners should be told which bit of the British strategy the Government are so keen to wish upon the rest of the EC. Is it the 2.5 per cent. cumulative cut in real domestic product that Britain will have seen during the past three years, even if the Government manage to realise their pathetic 1 per cent. growth target for next year? Is it the 4.5 per cent. fall in employment, the 5 per cent. drop in industrial production, the 11 per cent. fall in business investment or the 12 per cent. fall in fixed investment? Which bit of the British economic miracle are the Government wishing on the rest of the EC?
In the same article, describing a possible Government Delors-style initiative at the European summit, a Treasury inside source said : "You could say it is an attempt to steal his clothes."
That shows just how few clothes the Government have of their own, and how embarrassed they are at their inadequacy.
We saw a few of the Opposition's clothes stolen in the autumn statement. Government by kleptomania is now the Tory style. I warn the Conservative party that, as they pick bits piecemeal from Labour's proposals but the public see them as half-hearted, hesitant, renouncing from No. 11 Downing street today that which was hyped-up from No. 10 Downing street yesterday, as they see the Government refusing to adopt our full-blooded programme for recovery, all the Conservatives will succeed in doing is legitimising and popularising what the Opposition are saying.
Column 832
As the public's appetite for active government is whetted, they will turn increasingly to the party which believes in it, not the Government who have spent more than a decade preaching the virtues of so-called non-intervention. An ideological tide is turning, as people realise that common action is needed to solve common problems, that Government must build a partnership with industry, with employees, with trade unions, with regions and with the countries of the United Kingdom, as well as with our European partners.For that partnership to work, it must embrace everybody. It cannot cut out the trade unions or the workers covered by the wages councils or the poor and dispossessed. The Government cannot say yes to the single market but no to the social chapter, yes to Maastricht but no to progress on economic and monetary co-operation, and they cannot say yes to subsidiarity abroad but no to subsidiarity at home. Throughout the British presidency, the Government and the Prime Minister have tried to face both ways. As someone memorably said, they go into Europe like a gatecrasher walking into a party backwards assuring those around them that they are just on their way out. The truth is that the British presidency, at this crucial time in the Community's development, has been chronically and irretrievably enfeebled by the yawning chasm in the Conservative party. Faced with the Conservative record of ambivalence, incompetence and missed opportunity, the House can have no confidence in the ability of a Government who have achieved so little in the first five months of their presidency now to bring about all that is needed in their last five weeks. A new purpose, new partnership, and new direction are called for in Britain's policies on Europe, and I ask the House to signal that new direction by voting for our amendment.
9.39 pm
The Paymaster General (Sir John Cope) : I will respond in the time available to as many as I can of the points raised in this wide-ranging and timely debate. We are at a key moment in the Community's development, given that we are in the run-up to the Edinburgh European Council and also-- though not entirely--because of the Maastricht debate, about which we heard a good deal today. Today's debate was timely also because we are 37 days away from the completion of the single European market--a concrete realisation of our commitment to the principles of the free movement of goods, services, people and capital. Furthermore, we are working towards settling the Community's financial framework for the coming years, as well as the 1993 budget.
The GATT talks to free world trade have moved forward again, we are preparing for the Community's enlargement, and we are leading the humanitarian effort and the call for greater United Nations involvement in the conflict in Bosnia and other parts of the former Yugoslavia. We are strengthening our links with the democracies of central and eastern Europe.
Apart from that terrific agenda for the presidency that we have been vigorously pursuing, all the countries of the Community face difficult economic problems and a tight financial situation. All those issues are central to our economic and political well-being and to British prosperity, which is why they are so important to us.
Column 833
My right hon. Friend the Secretary of State for Foreign and Commonwealth Affairs spoke earlier about some of the major themes of our presidency and of the Council. I shall focus principally on economic and financial issues. None is more important than the single European market. I assure my hon. Friend the Member for Esher (Mr. Taylor) that we shout from the rooftops whenever opportunity offers--including now- -the central role that the single market is playing in the well-being of this country and of the European Community.The single European market will bring real benefits for British business and for British individuals. It means more business opportunities, and that means more jobs. It means less red tape and lower business costs, with an end to routine customs controls and paperwork. The single market means that, as barriers to trade come down, consumers will have a wider choice of goods and services. Employees will find wider recognition of qualifications, making it easier for people to live and work wherever they choose in the Community.
Mr. George Robertson : Was not one of the objectives of the single European market the harmonisation of value added tax rates? Can the right hon. Gentleman give an update on progress towards that?
Sir John Cope : Not harmonisation. After all, we are retaining fiscal sovereignty for the House, which is absolutely right. I suppose that the hon. Gentleman wants us to give away the financial powers of the House? The agreements are about minimum rates of VAT and excise duties, and that is how it should be.
Our membership of the single market has already made Britain a magnet for inward investment. My hon. Friend the Member for Brecon and Radnor (Mr. Evans) paid eloquent tribute to inward investment in Wales, and my hon. Friend the Member for Derby, South (Mrs. Currie) paid an even more eloquent tribute, if that is possible, to the beneficial effect of inward investment on jobs in south Derbyshire--but only after slating the Treasury, in the person of myself, for the wording of a particular explanatory memorandum. I am afraid that such texts must be rather complicated, but I accept her strictures.
As to inward investment, 40 per cent. of Japanese investment in the Community is in the United Kingdom. There was £17 billion-worth of inward investment in 1990, with 50,000 manufacturing jobs now flowing from that. The United Kingdom has some 40 per cent. of total United States investment stock in the European Community.
The single market will encourage British companies to invest in businesses in Europe. As the single market extends to the European economic area next year, United Kingdom businesses will have a home market of 375 million consumers. That will help us to compete in the world marketplace as well as within Europe.
I recognise that, as my hon. Friend the Member for Dover (Mr. Shaw) said, some people will not gain from the single market. His example was freight- forwarding agents and customs agents in his constituency and elsewhere. As the Commission has said, retraining of customs agents is primarily a matter for member states, but Community funding is also available from the social fund. In addition, the Commission is proposing a one-year package to assist redundant agents.
Column 834
At the meeting of the Finance Ministers yesterday, there was a lukewarm attitude towards the proposals. Nevertheless, the discussions are continuing within the Council. Meanwhile, 30 million ecu have been entered in the draft budget, pending the adoption of a legal base.The hon. Member for Copeland (Dr. Cunningham)--I must admit that it is a nice name for a constituency
Mr. David Shaw : Will my right hon. Friend give way?
Sir John Cope : No, I must get on--I have little time and many matters to deal with. I have said all that I can about that particular matter.
The hon. Member for Copeland blamed the presidency for all sorts of things, including the recession. Several hon. Members have spoken about the prospects for growth and jobs. The United Kingdom presidency has given a clear lead to ensure that the Community takes effective action.
My right hon. Friends the Prime Minister, the Chancellor, the President of the Board of Trade and the Minister of Agriculture were tirelessly involved in paving the way for the GATT agreement. That is the most important step that the Community can take to boost confidence and growth.
OECD estimates suggest that an additional $200 billion in world output could follow. That is important not only to the United Kingdom but to the rest of Europe and much further afield. I have already referred to the single market, which is extremely important for the United Kingdom.
We propose a full discussion of the European economy at Edinburgh. As the House knows, and as we debated last week, the Government have introduced a package of measures for the United Kingdom. Within a framework of fiscal discipline, we have sought to sustain investment growth and rebalance public expenditure--constraining wages but protecting capital. All that is to boost confidence. Last week, the Labour party was unsure whether to claim credit for that or to attack us, and it was the same today. Similar measures could be taken and are being taken by other member states.
Mr. Andrew Smith : What specific measures and new projects for economic recovery and job creation will the Government propose at Edinburgh?
Sir John Cope : The discussion in Edinburgh will focus on the matters that I have just discussed. Member states are examining those matters. Measures are also being taken at Community level. The co- ordination and development of actions of member states are most important. [Interruption.] The hon. Gentleman may laugh, but that is the fact of the matter. At the Community level, there is scope, within a tight fiscal framework, for a shift in priorities. The European investment bank can be used to work with the private sector to increase transport and other capital projects. The Community can also encourage capital spending. We shall be discussing those matters further at Edinburgh, but there have been many discussions before. Of course, as my right hon. Friend said this morning, there are other matters of great importance, including German interest rates. Interest rates were also mentioned by my hon. Friend the Member for Esher and others.
We have heard a great deal about regulation and deregulation, especially from my hon. Friend the Member for South Hams (Mr. Steen). He made an entertaining speech about a series of controls of unspecified origin
Column 835
which bore down on small firms in his constituency. He and the House will be aware of my involvement with small firms and my support for them as a boost to the economy. I am happy to tell him that, about two weeks ago, my right hon. Friend the President of the Board of Trade announced an enhanced role for the deregulation unit in the Department of Trade and Industry and the appointment of Lord Sainsbury to review the matter and investigate examples such as those to which my hon. Friend the Member for South Hams drew attention. My hon. Friend has given Lord Sainsbury a good agenda on which to start. I gather that Lord Sainsbury's remit covers both United Kingdom and European Community legislation.Mr. Stuart Randall (Kingston upon Hull, West) : There is some anxiety in the House about such regulations. Have the Government decided which of the regulations are acceptable to them and which are not? If some are not acceptable, what mechanism exists to ditch them?
Sir John Cope : If the hon. Gentleman is referring to domestic legislation, it is fairly easy to deal with the matter. For regulations in European Community legislation, the remedy is to go back to the European Community, to DG23 and so on. That is exactly what we do, and what we shall do in the cases highlighted by the committee to which I referred and by the deregulation unit of the DTI.
Mr. Steen : Will my right hon. Friend consider that we could shelve or delay implementation of rules and regulations until all the other countries implement the regulations that we have implemented?
Sir John Cope : We do our best to ensure that all the legislation is introduced at the same time and pursued equally by all member states. The Maastricht treaty will help us to achieve exactly that. The hon. Member for Ross, Cromarty and Skye (Mr. Kennedy) asked about the Committee of the Regions and about several other matters. Ratification of the treaty will have to take place before the committee can be established. It would therefore be premature to examine the composition and procedures of the committee, but we are considering the matter and consulting on it.
Several hon. Members referred to subsidiarity and the position of Scotland. The matter was raised with my right hon. Friend the Foreign Secretary but also came up later in the debate. I was asked whether article 3.6 would be justiciable. The answer is yes, it will be justiciable once the treaty is ratified, but it is clear that article 3.6 is not about the internal organisation of member states.
Mr. Andrew Smith : The Minister means article 3b.
Sir John Cope : I beg the hon. Gentleman's pardon. I cannot read my own writing. Those who suggest that article 3b should deal with the internal organisation of member states would be widely criticised if they attempted to put that idea into practice. What it means, after all, is that the Maastricht treaty--or some other treaty--should affect the powers of the House, apart from anything else. That would be totally unacceptable, to say the least.
The hon. Member for Banff and Buchan (Mr. Salmond) entertained us with some discussion of Hogmanay haddock, but he also made some serious points. Fortunately, my hon. Friend the Member for Skipton and
Column 836
Ripon (Mr. Curry) was in the Chamber at the time and heard what the hon. Gentleman said. My hon. Friend is currently Minister of State, Ministry of Agriculture, Fisheries and Food, and is also President of the Fisheries Council.The hon. Member for Ross, Cromarty and Skye accused the United Kingdom of abusing the additionality requirements. I do not accept that for a moment ; the United Kingdom complies fully with the spirit and the letter of the legislation. The hon. Gentleman may have been thinking of some delay by the Commission earlier this year in approving the United Kingdom's RECHAR allocation. That issue was resolved to the satisfaction of both the United Kingdom and the Commission as a result of a change in the presentation of the United Kingdom's structural fund receipts in the public expenditure documents.
A number of hon. Members mentioned the general issue of the United Kingdom approach to budgetary and financial matters. The United Kingdom's underlying net contribution to the European Community budget through the public sector is now running at some £2 billion a year--the figure would be much higher without the abatement. That is a large sum, but it is not the whole story. It does not reflect, for example, the substantial receipts which flow from the Community budget to the United Kingdom private sector, amounting to about £500 million a year.
In addition, some elements of Community budget spending directly substitute for what would otherwise have to be paid from our national budget. One example is external aid. The United Kingdom takes in structural fund receipts of more than £1 billion a year, which are extremely important to us ; and, as a former Northern Ireland Minister, I can vouch for the significant contribution made by such receipts in the Province. One of the achievements of the 1993 budget is a doubling of the structural funds since 1988 : that was a commitment that we undertook previously.
Several hon. Members referred to the position within the different objective regions, including the highlands and islands. Decisions on which regions will be classified as objective are for the review of the structural funds next year.
Let me say a word about the European Community budget. As originally proposed by the Commission, the commitments for so-called non-obligatory expenditure were to increase by no less than 15.8 per cent. I know that Labour Members always want to spend more on everything, but throughout the debate they have stressed the importance of spending just as much as the Commission and nearly as much as the European Parliament, which suggested that expenditure should rise by 17.67 per cent. in a single year. The Budget Council has reduced that to a 3.91 per cent. increase over 1992. That is still a considerable increase, but there is further discussion to come. I have already referred to the extra spending on the structural funds, which is within the expenditure to which I have referred. Yesterday, we made it clear once again that we would not accept an adverse change in the abatement. An intervention from the hon. Member for Hamilton (Mr. Robertson) in the speech of my right hon. Friend the Foreign Secretary suggested that Labour would put the abatement up for negotiation. [ Hon. Members :-- "No."] I am glad to have that reassurance : it was not at all clear when the hon. Member for Dunfermline, East (Mr.
Column 837
Brown) spoke on the radio this morning. It is very important that Britain should maintain that abatement. It is also very important that we maintain budgetary discipline, value for money and the fight against fraud, all of which we are doing in the budget this year, as part of the British presidency.Question put, That the amendment be made :--
The House divided : Ayes 262, Noes 312.
Division No. 92] [10 pm
AYES
Abbott, Ms Diane
Adams, Mrs Irene
Ainger, Nick
Ainsworth, Robert (Cov'try NE)
Allen, Graham
Anderson, Donald (Swansea E)
Anderson, Ms Janet (Ros'dale)
Armstrong, Hilary
Ashdown, Rt Hon Paddy
Ashton, Joe
Austin-Walker, John
Banks, Tony (Newham NW)
Barron, Kevin
Battle, John
Bayley, Hugh
Beckett, Margaret
Bell, Stuart
Benn, Rt Hon Tony
Bennett, Andrew F.
Benton, Joe
Bermingham, Gerald
Berry, Dr. Roger
Betts, Clive
Blair, Tony
Blunkett, David
Boateng, Paul
Bradley, Keith
Bray, Dr Jeremy
Brown, Gordon (Dunfermline E)
Brown, N. (N'c'tle upon Tyne E)
Bruce, Malcolm (Gordon)
Burden, Richard
Byers, Stephen
Callaghan, Jim
Campbell, Mrs Anne (C'bridge)
Campbell, Menzies (Fife NE)
Campbell, Ronnie (Blyth V)
Campbell-Savours, D. N.
Canavan, Dennis
Cann, Jamie
Carlile, Alexander (Montgomry)
Chisholm, Malcolm
Clapham, Michael
Clark, Dr David (South Shields)
Clarke, Eric (Midlothian)
Clelland, David
Clwyd, Mrs Ann
Coffey, Ann
Cohen, Harry
Connarty, Michael
Cook, Frank (Stockton N)
Cook, Robin (Livingston)
Corbett, Robin
Corbyn, Jeremy
Corston, Ms Jean
Cousins, Jim
Cryer, Bob
Cummings, John
Cunliffe, Lawrence
Cunningham, Jim (Covy SE)
Cunningham, Dr John (C'p'l'nd)
Dafis, Cynog
Dalyell, Tam
Darling, Alistair
Davidson, Ian
Davies, Bryan (Oldham C'tral)
Davies, Rt Hon Denzil (Llanelli)
Davies, Ron (Caerphilly)
Davis, Terry (B'ham, H'dge H'l)
Denham, John
Dewar, Donald
Dixon, Don
Dobson, Frank
Donohoe, Brian H.
Dowd, Jim
Dunnachie, Jimmy
Dunwoody, Mrs Gwyneth
Eagle, Ms Angela
Eastham, Ken
Enright, Derek
Etherington, Bill
Fatchett, Derek
Faulds, Andrew
Field, Frank (Birkenhead)
Fisher, Mark
Flynn, Paul
Foster, Derek (B'p Auckland)
Foster, Don (Bath)
Foulkes, George
Fraser, John
Fyfe, Maria
Galbraith, Sam
Galloway, George
Gapes, Mike
Garrett, John
George, Bruce
Gerrard, Neil
Gilbert, Rt Hon Dr John
Godman, Dr Norman A.
Godsiff, Roger
Golding, Mrs Llin
Gordon, Mildred
Gould, Bryan
Graham, Thomas
Grant, Bernie (Tottenham)
Griffiths, Nigel (Edinburgh S)
Griffiths, Win (Bridgend)
Grocott, Bruce
Gunnell, John
Hain, Peter
Hall, Mike
Hanson, David
Hardy, Peter
Harman, Ms Harriet
Harvey, Nick
Hattersley, Rt Hon Roy
Henderson, Doug
Heppell, John
Hill, Keith (Streatham)
Hinchliffe, David
| Next Section
| Home Page |