House of Commons Hansard Debates for 13 Jan 1993

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decisions on a complex Bill and that that is what the true definition of parliamentary scrutiny should be? That is why we oppose a referendum.

Mr. Cash : I should have more sympathy with what my hon. Friend has said if I did not believe, as many other hon. Members and 75 per cent. of the British population believe, that the issue goes to the heart of the manner in which our parliamentary democracy is to be conducted. That is the crucial issue and that is why we seek a referendum.

I wish to refer to the recent statement of Chancellor Kohl of Germany of Monday 4 January with respect to the Edinburgh summit, which has direct relevance to the questions arising on title II. He said :

"the leaders of the European Community expressed their sympathy for Denmark's special reservations, but decided not to change the Maastricht treaty. Reopening negotiations was not, and is not, on our agenda."

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He continued :

"In Edinburgh we therefore could go no further than to clarify the relevant treaty clauses to respond to the main Danish concerns. This purely declaratory decision' neither changes nor complements the treaty and therefore does not require ratification by member states."

It was with that in mind that I raised the question whether the Attorney- General could or should come to the House--I believe that he should--to explain to us precisely the nature of the decisions taken in Denmark. Undoubtedly there are seriously conflicting opinions. Eminent Queen's counsel believe that the Danish decision was not binding, and the view has been expressed that the matter is being dealt with by an international legal obligation outside the treaty. Indeed, that is what the Government claim.

A major question arises that turns on the nature of the legal commitment, if it be a commitment at all ; I believe that it is not. This will ultimately determine the relevance of the Edinburgh summit and the decision that was taken, with vast consequences for the United Kingdom, the Danish people and Europe as a whole. We do not want the treaty ratification procedure to proceed in a state of obscurity and confusion. We want to get the thing out into the open. Accordingly, I believe that it would be important for the Attorney-General--I have written to him and to my right hon. Friend the Prime Minister, enclosing a copy of a legal assessment that has been produced by some eminent Queen's counsel, to ask for their opinions--to clarify the matter. I have asked my right hon. and learned Friend and right hon. Friend to give me their opinions in writing.

Mr. Spearing : I think that everyone agrees that this is a constitutional matter of some significance. You may recall, Mr. Morris, that we had some difficulty during a previous debate when the Minister was unable immediately to answer some of the questions that were put to him. I wrote to the Attorney-General on the Edinburgh issue on 15 December and asked him to reply before this debate took place. The hon. Member for Stafford (Mr. Cash) may be interested to know that I heard this morning that the Attorney-General would not be replying. I was told that a reply would come from the Minister of State, but that it was unlikely that I would receive it before this debate. I mention that to help the hon. Gentleman and the entire Committee. There are many matters that should be

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clarified, and especially the views of the Government, before we proceed, because we do not know how they will affect the law of this country.

Mr. Cash : I am grateful to the hon. Gentleman for that intervention which helps to clarify the position.

Title II--

Mr. Jeremy Corbyn (Islington, North) : Will the hon. Gentleman give way?

Mr. Marlow : Let my hon. Friend get on.

Mr. Corbyn : I thank the hon. Member for Stafford (Mr. Cash) for giving way. He has obviously studied these matters in some detail. As an agreement has been reached between the Government and the Danish Government on a let-out clause that meets the Danish position, and if there is to be no change in the proposed Maastricht treaty, what is the point or validity of having a referendum in Denmark when nothing has changed since the first referendum?

Mr. Cash : That is the very matter which should be clarified. Does the present position add up to a row of beans? On one interpretation it appears that it does not. The matter must be resolved as we go forward.

Mr. Bernard Jenkin (Colchester, North) : I think that I might be able to shed some light on the matter. In his statement to the House, my right hon. Friend the Prime Minister said :

"The solution is binding in international law."--[ Official Report, 14 December 1992 ; Vol. 216, c. 23.]

Any reference to Community law is conspicuous by its absence. Is not that the truth of the matter? It might be an international treaty, but it has no validity in Community law.

Mr. Cash : That is where the problem lies. We are talking about the ratification of a treaty. We are dealing with the future of the European Community. Title II amends the whole of the treaty of Rome over a wide range of matters which are set out from page 9 to page 60 of Cm. 1934. All those matters are affected by the legal status of the decisions that are being taken, provided that they are being taken in a proper constitutional manner that can stand up in relation to the European Community itself.

It is no good Governments and others going round, in the belief that they can cobble together decisions on pieces of paper, picking a little bit from one pigeon hole of international law and a little bit from another, nesting here and nesting there. We must know the precise impact of the treaty. The purpose of my opening with Chancellor Kohl's remarks is to illustrate the point that there is no clear understanding, even among the leaders of Europe, of precisely what was decided at Edinburgh.

Mr. Nicholas Budgen (Wolverhampton, South-West) : Will my hon. Friend invite the Minister to explain how, if, as we understand it, under the European Communities Act 1972, the general body of international law is excluded from consideration under Community law, the treaty can be binding in international law and binding in Community law?

Mr. Cash : My hon. Friend, who is a distinguished lawyer, makes yet another good point. The matter must be cleared up. We need to know the treaty's implications for Britain's domestic law in order to decide whether we have a treaty with which we can live.

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Mr. Marlow : As that matter is so fundamental to the further consideration of the great issues that are at stake, will my hon. Friend, before he proceeds with his speech, put a positive, generous and pleasant invitation before the Minister to clarify the issue now so that we know where we stand?

Mr. Cash : I am grateful for that suggestion. The Minister of State, who is attentive to these matters at all times, will no doubt want to respond. I do not know whether he wishes to do so now. I see no sign of great movement to the Dispatch Box, but I hope that at least his advisers will bear in mind that we not only ask for but insist upon an answer to the question. The whole range of government of the United Kingdom is being changed dramatically by the treaty and by the provisions of title II. It is not good enough for us to be left in any uncertainty about the impact of the treaty on our domestic law. The ratification of the treaty means that we will be part of a new Community. Therefore, I invite the Minister to make a representation to us in due course, I hope before the end of the day.

Mr. Dalyell : If the hon. Gentleman is so attentive to all these matters, could we be forgiven for wondering how such a diligent colleague brought himself to vote for the Single European Act?

Mr. Cash : The answer to that is extremely simple. I believe in the European Community, it is extremely important and it should be made to work on a realistic basis. The Single European Act, through co-operation and, primarily, through its development of commercial and trading policies, was a sensible way in which to reduce barriers to trade and to increase free trade throughout Europe. The Single European Act is primarily about trading and commercial matters, but the Maastricht treaty is primarily about government.

The Minister of State, Foreign and Commonwealth Office (Mr. Tristan Garel- Jones) rose--

Mr. Cash : I shall give way to the Minister. I gather that he intends to resign, but we do not yet know whether he has.

Mr. Garel-Jones : Does my hon. Friend also support the extensions of qualified majority voting brought about by the Single European Act? Does he therefore support the principle of qualified majority voting?

Mr. Cash : I have said repeatedly that I am in favour of the notion of an increase in majority voting for specific purposes relating to co- operation in the commercial field which will enable free trade to develop within Europe and at the same time ensure that we can reduce barriers to trade. The Community originated because of difficulties in reducing protectionism. Therefore, it had a logical reason. There is no logical reason for turning over Britain's government and democracy to majority voting. That is political union. The Single European Act was a move towards greater economic union.

Mr. Budgen : Does my hon. Friend agree that one thing that has clearly emerged is that the European Court is a highly political organisation? Was it not a highly political organisation at the time of the Single European Act? Many of us thought that if we voted for any form of qualified majority voting, that procedure would be progressively

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extended by the political movement of the Commission and the Court. How did my hon. Friend find himself able to support the beginnings of that most disagreeable procedure?

Mr. Cash : I am always delighted to reply to a mischievous remark by my hon. Friend. He may recall that I tabled an amendment to the Single European Act which said that nothing in the Act would derogate from the sovereignty of the United Kingdom. My hon. Friend will be glad to know that Mr. Enoch Powell signed that amendment because he believed that it would be a way of containing the implications of the Single European Act described by my hon. Friend. None the less, for the reasons that I have given, I thought the Act necessary to reduce the degree of protectionism.

The Chairman : Order. I imagine that the former Member for Wolverhampton, South-West, Mr. Powell, will wish to read the argument for amendment No. 40 in tomorrow's Hansard. I hope that we can now get on with amendment No. 40 so that he is not disappointed.

Mr. Cash : What does title II involve? Article G turns an economic community into a European community. That is a fundamental change. It is intended to move from the notion of an economic community to a political union. A subsequent amendment in my name deals with political parties in Europe. It is clear from the treaty--I know that many Conservative Members wish it--that European political parties should operate within a politically integrated Europe. That is what the treaty says and it is clear that the idea is for political parties to operate at a European level with a view to

integration--political integration in Europe. That is why I object to the change of the words from European Economic Community to European Community. We are debating the construction of a federal treaty, the primary political impetus of which is to be at the European level, and the political parties at that level are intended to replace the national Parliaments.

Mr. Bill Walker : Does my hon. Friend agree that in 1972 we were told that we were joining a European Economic Community and that certain provisions would be permanent? They are no longer there. In 1985-86 we were told that the Single European Act had only certain implications and some former members of the Government believed that and supported it, but they have now changed their position. Experience tells us that things go far further than the Bill and that is why the amendments are essential.

Mr. Cash : That is right. The fact is that the single market has been severely abused. The Select Committee on Trade and Industry is now investigating that, and I hope that that will help to make the market work more effectively.

Mr. Nicholas Winterton : I think that my hon. Friend has let go the challenge issued from the Front Bench rather too easily. If I am not mistaken, Ministers have challenged my hon. Friend to justify his current position, bearing in mind that he voted for the Single European Act in 1986.

Surely the House is entitled to learn from its mistakes. It is clear that many hon. Members believed what they were told by Ministers at the time about the limited implications of the Single European Act. We now see that the Act goes very much further. Should not the House of

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Commons, of all places--and, indeed, the Government--learn from their mistakes rather more frequently than they do?

Mr. Cash : I agree that we must all learn from our mistakes, but I will not change the position that I have adopted, and have held consistently.

The single market needs to be cleaned up. It has been abused, and I hope that the Select Committee on Trade and Industry will be able to throw some light on the unfair practices that are causing immense damage to British industry, increasing unemployment in this country and worsening the recession.

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Mr. Marlow : Had my hon. Friend known in advance that the powers for qualified majority voting in the Single European Act would be as heavily abused by the European institutions as we have discovered them to have been, would he have voted for it?

Mr. Cash : The answer to that can be found in what my hon. Friend the Member for Wolverhampton, South-West (Mr. Budgen) said about the activities of the European Court of Justice. Abuses should be dealt with in that court. I stand by what I said about the single market. The provisions of article 2, which replaces the previous article 2, include a reference to

"sustainable and non-inflationary growth respecting the environment, a high degree of convergence of economic performance, a high level of employment and of social protection".

One thing can be said for certain about the direction in which the European Community is currently going : we are emphatically not seeing a high degree of economic convergence, non-inflationary growth or a high level of employment.

The real problem is that that is a load of rubbish. The words are in the treaty, but there is absolutely no evidence that the way in which the policies are being implemented is having any effect of the kind that is desired. Unemployment in the Community has risen from about 8 million to 15 million over the past few years, and it is expected to rise further to about 30 million. The policies that are being pursued are emphatically not bringing unemployment down. Indeed, I will go further and say that the Maastricht provisions relating to economic and monetary union and to convergence are likely to impose immense pressure for more unemployment. Moreover, the capping of public spending will prevent people from benefiting from an infrastructure that would generate construction work and thus increase employment.

The provisions of article 2 are completely contradicted by what is now happening, and the position is becoming worse rather than better. That in itself is a reason for leaving out article 2. People's expectations are being raised and then dashed. How can anyone imagine that that can continue without serious disruption in Europe? It is bad for business, because it raises expectations that cannot be fulfilled : it is wrong to deceive the workers of Europe into believing that something will happen simply because of what is written on a piece of paper. That is one of my objections to article 2. It is unfair and unrealistic to mislead people in such a way.

Sir Russell Johnston (Inverness, Nairn and Lochaber) : I do not wish to interrupt the hon. Gentleman's flow, but I feel that his remarks about the clause referring to

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political parties must be challenged. Presumably he does not object to the Conservative party's playing its part in a wider Conservative/Christian Democratic coalition. If he does not, what does he consider to be the purpose of such involvement?

Mr. Cash : It is clear that some form of political understanding in Europe is required, but that is perfectly achievable within the framework of the treaty of Rome and the Single European Act as it stands. There is no need to go down this further route. We want to enhance the national Parliaments and improve the scrutiny process, which is now lamentable in many member states. It is for precisely such reasons that I object to the fact that all we have at the back of the Maastricht treaty is a declaration relating to national Parliaments. It is not binding in any sense. We want to improve the quality of political decision making in Europe, but the treaty will do exactly the opposite.

Mr. David Winnick (Walsall, North) : The hon. Gentleman mentioned public spending. Many Opposition Members--perhaps the majority ; I do not know--find one aspect of that very difficult to understand. How on earth can someone who argues for further public spending to deal with a high level of unemployment--whether in Britain, where it certainly exists, or elsewhere in the Community--defend or justify the maximum gross national product of 3 per cent. that is laid down in the treaty?

At least a page is devoted to the penalties that will be incurred by member countries that go beyond that limit, but no limit is set in regard to unemployment, apart from the reference mentioned by the hon. Gentleman. If the treaty proceeds and such a limit is applied, it will undoubtedly bring about far more unemployment, deflation and misery throughout the Community. I do not see how any member of the Labour movement could possibly support what is being done.

Mr. Cash : That echoes many of the sentiments that I have expressed. Decisions about the allocation of economic and social priorities are currently made in the ballot box in general elections, on the basis of party manifestos, but all that will be taken away--even, in practice, under stage II, by way of gravitational pull into stage III. Under stage II, the European monetary institute will have important and greatly underestimated functions, which were criticised by a member of the Bundesbank council who wrote to me recently. He said that they had not been properly explained to the German people.

The understanding entered into about stage II will have a profound impact on decisions made by the people who will suffer increasing unemployment. In fact, the power to make those decisions is being taken from them and given to members of the European monetary institute. The Governor of the Bank of England, sitting in the monetary institute--under article 8 of the protocol relating to it--will not be able to take instructions as currently prescribed by section 4 of the Bank of England Act 1946.

The massive change taking place under stage II has been greatly underestimated. It strikes at the heart of the way in which we make decisions. Our voters, who are afflicted by the unemployment that is resulting from decisions that are already effectively being implemented, are losing the power to make their own decisions. Such

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considerations lead some of us to say, in the absence of a free vote, that we must have a referendum. The people must be consulted.

Mr. Hugh Dykes (Harrow, East) : Will my hon. Friend make available the letter from the Bundesbank official about the monetary institute and European monetary union, so that hon. Members can read it?

Mr. Cash : It is not a letter but an article, which makes it clear--

Mr. Dykes : If I may interrupt my hon. Friend, he told the Committee that he had a letter from, I believe, the vice-chairman of the Bundesbank--

Mr. Charles Kennedy (Ross, Cromarty and Skye) : No, from a member of its council.

Mr. Dykes : I am grateful to the hon. Gentleman. He was presumably writing to explain why he has misgivings about the policy formulations in that particular part of the treaty. Will my hon. Friend help by making that letter--written to him,

presumably--available to us all?

Mr. Cash : If any correction is required, it is contained in the document that I have, which is not a letter but which throws considerable doubt on the feeings that there were about the monetary institute and the attitudes adopted by the Bundesbank council.

Mr. Dykes : I am grateful for my hon. Friend's description of an article, but that is not the same as his saying--as he clearly and equivocally did just now--that he had received a letter. Presumably it was addressed to him, perhaps in response to one sent by my hon. Friend to a member of the Bundesbank council or because he had been mentioned in the press. It was clearly described as such. I know that my hon. Friend has been in difficulties with other kinds of letters recently. I received an interim reply from Madam Speaker about an inquiry that is under way in the Serjeant at Arms office because my hon. Friend has apparently been using official envelopes to write to the constituents of other right hon. and hon. Members to tell them about anti-European meetings--

The Chairman : Order. The hon. Gentleman must address the Chair. I am mystified as to the relationship of that point to amendment No. 40. Also, the hon. Member for Stafford (Mr. Cash) is beginning to repeat the speech that he made before Christmas. I listened attentively then and read it carefully, and I do not really want to hear it again. I should like to hear about amendment No. 40, about which we have heard very little in the nearly half an hour that the hon. Member for Stafford has been on his feet.

Mr. David Harris (St. Ives) : On a point of order, Mr. Morris. A serious allegation has been made by my hon. Friend the Member for Harrow, East (Mr. Dykes) against my hon. Friend the Member for Stafford (Mr. Cash). Surely it is only right and proper, in the best traditions of the House, that my hon. Friend the Member for Stafford answers that serious allegation about apparent misuse of House of Commons stationery.

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The Chairman : That matter is for Madam Speaker and the Serjeant at Arms and not for the Committee stage of a Bill. I hope that right hon. and hon. Members recognise that.

Mr. Dykes : On a point of order, Mr. Morris. May I point out that if I was addressing the Chair incorrectly when you called me to order, it was because I was anxious to hear an explanation from my hon. Friend the Member for Stafford. If it is in order, perhaps he will respond to my latter comments--but I would particularly like an explanation about my hon. Friend's reference to the letter from a member of the Bundesbank council.

Mr. Cash : If it was misunderstood, I withdraw any suggestion that I received a letter from a member of the Bundesbank council. I make that clear. However, the article in question throws grave doubts on the basis on which the EMI was established.

The Chairman : Order. I ask the hon. Gentleman to relate that matter specifically to amendment No. 40 or to leave it aside.

Mr. Roger Knapman (Stroud) : On a point of order, Mr. Morris. If the time comes when a closure motion is moved in resepct of this set of amendments, will you bear in mind

The Chairman : Order. I am not anticipating any future events. I merely want the Committee to proceed with the debate on amendment No. 40-- or I hope that it will do so.

Mr. Cash : Citizenship of the union raises a fundamental question about the relationship of the voter to the Government of this country as elected at a general election. Article 8(2) states :

"Citizens of the Union shall enjoy the rights conferred by this Treaty and shall be subject to the duties imposed thereby." No specific, clear indication is given of what those duties will be. That article is therefore in the nature of a blank cheque, which presents a serious problem. If we are expected to ratify that provision without being told the nature of those duties, we are being asked to agree to something that the people of this country will not, without an explanation, be able to understand.

Title VI raises the whole question of economic and monetary policy. Its provisions present a serious difficulty in relation to the manner in which decisions are taken, to which I referred when I dealt with the European monetary institute and its relationship to the establishment of the central bank.

By creating that bank for the whole of Europe, a lethal blow is being struck at the heart of democracy for the people of Europe as a whole. We may have an opt-out, but it must be set against the provision relating to the EMI and to the transitional arrangements to which I referred earlier.

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An amendment in the name of the Leader of the Opposition seeks to leave out the whole of title III, which deals with the European Coal and Steel Community. I do not know what led to that particular provision, wide ranging though it is. However, its importance in relation to the British pit closure programme and to matters that we debated some months ago--which led to the High Court

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declaring that closure programme unlawful-- raises an important question in respect of the European coal and steel industry and its regulation.

I understand that a 100-year contract on very favourable terms, and backed by subsidies, has just been provided to the German coal industry, which will place a very unfair burden on our electricity users. I understand also that the European Commissioner formerly responsible for competition policy, Sir Leon Brittan, who has just changed his portfolio, approved a £3.3 billion deal between the power generators and the heavily subsidised coal industry.

Under that arrangement, which was entered into under the European coal and steel regulations, Britain is presented with a significant problem in respect of its own coal industry. A significant part of that industry, which includes the Trentham colliery in my constituency, is due for closure. It seems wholly wrong that that should have happened in the first place, and under the aegis of the European coal and steel arrangements.

Mr. Bowen Wells (Hertford and Stortford) : On a point of order, Mr. Morris. Is it in order for my hon. Friend the Member for Stafford (Mr. Cash) to address the Committee on the European coal and steel industries covered by title III when right hon. and hon. Members are debating an amendment that seeks to eliminate title II?

The Chairman : Perhaps the hon. Gentleman will note that the selection list allows for titles II and IV also to be debated. While I understand the hon. Gentleman's point, in that I would expect the hon. Member for Stafford to concentrate on title II, nevertheless his remarks are just in order.

Mr. Cash : When those negotiations are under way, the opportunity to sort out the problems created by unfair subsidies and unfair competition could and should have been taken.

Amendment No. 183, also in my name, refers to article Q in title VII, which prescribes that the period of the treaty shall be unlimited. The treaty itself contains no power for cessation. If it is to be "for an unlimited period", we ought to be given some indication of why, if things go wrong, we will not have an opportunity to reconsider matters.

The provisions of title II are extremely wide ranging and affect all the amendments relating to the treaty of Rome. They go to the heart of the manner in which we would be governed in Europe as a whole. They deal with questions relating to employment, public health and culture and the establishment of trans-European networks. We have been given no justification for the provisions. There has been no White Paper explaining why they have been brought forward ; we have had to rely instead on occasional Select Committee hearings, and so on.

It seems to me that the entire title is unnecessary. The policies that lie behind it have not been borne out by practical experience. Britain has a massive trade deficit with the European Community--at present, about £15 billion a year. I seek an improvement in the quality of free trade within the European Community. The present proposals are unnecessary. We should be improving the European Community rather than becoming involved in the governmental matters referred to in the treaty--a move which will cause a serious loss of faith in our ability to work together and co-operate in Europe as a whole.

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Mr. Andrew Smith (Oxford, East) : Labour's approach to the amendments, to the important provisions of titles II, III and IV--and, indeed, to the Bill as a whole--is to argue for European co-operation as an important dimension of our party's internationalism. For the people of Britain, as for the people of Europe, we want to see the real benefits of a positive future for the European Community.

Mr. Denzil Davies : On a point of order, Mr. Morris. The second amendment in the group was tabled by a number of my right hon. and hon. Friends and myself. You have quite properly called the Front-Bench spokeman. May I suggest, however, that the Opposition Front-bench spokeman cannot have an inalienable right to be called to speak immediately after the mover of an amendment and that consideration should be given to those on the Back Benches who have tabled amendments?

The Chairman : There is no inalienable right, but it seemed appropriate on this occasion that I should call the Opposition Front-Bench spokeman. I was hoping also to call the right hon. Member for Llanelli (Mr. Davies) before long--but we shall see how we get on.

Mr. Smith : I, too, am concerned that Back Benchers should have a proper opportunity to contribute to our proceedings. It is not the length of Opposition Members' speeches that have prevented them from doing so.

We tabled amendments Nos. 11, 17 and 20 so that we might have an opportunity to present the case for a positive future for Britain in the European Community. They are probing amendments and will not be pressed to a vote.

The Labour party has made it clear how important we believe it is that the Community pursues the principles set out in article 2 of the treaty, which the hon. Member for Stafford (Mr. Cash) described as rubbish. So far from being rubbish, they are eminently desirable and important goals for Europe to pursue. The article is a powerful statement of the central objectives of the European Community and it is important to get that message across to the public. It states : "The Community shall have as its task, by establishing a common market and an economic and monetary union and by implementing the common polices or activities referred to in Articles 3 and 3a, to promote throughout the Community a harmonious and balanced development of economic activities, sustainable and non-inflationary growth respecting the environment, a high degree of convergence of economic performance, a high level of employment and of social protection, the raising of the standard of living and quality of life, and economic and social cohesion and solidarity among Member States."

Those important objectives, set out at the beginning of the treaty as the Community's task, set the context, legally as well as politically, within which its other provisions must be interpreted and applied. Britain would be much better off if the Government acted on the provisions of article 2, not least by giving the lead on proposals for concerted European economic recovery rather than obstructing them and watering them down.

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