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Mr. Cash : I am delighted that the hon. Member for Hemsworth (Mr. Enright), who is also a member of the Select Committee on European Legislation, has mentioned the Danish Parliament, and I agree that the Folketing is a first-class Parliament. The Westminster and Danish Parliaments are at the end of the queue for ratification because we are both determined to scrutinise the legislation properly, even though hon. Members on both sides of the House wish that we would not do so. They are trying to deny the people of this country the opportunity of a debate, because they are not participating in it.

Mr. Denzil Davies (Llanelli) : The hon. Gentleman was not in the House in 1972 when the original European Communities Bill was enacted. Those who were will recollect that many of us tried to amend that Bill to provide the sort of safeguards that have not been provided. The amendment was defeated by the then Conservative Government.

Mr. Cash : The hon. Gentleman merely reaffirms the disgraceful way in which the Danish people have been treated. Their constitution allowed a referendum, which clearly should have dispatched the matter, but certain people were not prepared to accept the result, so they will have to have another. Dubious and questionable opt-outs are being scrutinised by lawyers throughout Europe, not least in Denmark.

Mr. Andrew Rowe (Mid-Kent) : It is a bit thick for the hon. Gentleman to say that it was disgraceful that the referendum result was not accepted, as his stand is a rejection of the referendum result in this country.

Mr. Cash : I am having great difficulty in understanding what the hon. Gentleman is saying--perhaps I had better pass on to another subject. He seems to think that we have had a referendum on the treaty. I would advocate such a referendum. Perhaps he was giving me an inkling of what he would really like. If we had a referendum on mere trading arrangements in 1975, I am sure that he would agree that we should have one on the Maastricht arrangements. I am indebted to him for his remarks.

Mr. Rowe : The oft-repeated assertion that the referendum was held on trading arrangements simply does not stand examination. One only has to consider the publicity posted through letterboxes during the referendum, the White Paper and all the debates to realise that that suggestion does not stand examination.

Mr. Cash : The 1970 White Paper is the strangest joke to have been perpetrated on the people of this country. It is extraordinary to suggest that that White Paper was not riddled with deception. At the time, we were assured that


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there would be no erosion of national sovereignty, no federation and no loss of a veto. Even the hon. Member for Mid-Kent (Mr. Rowe) must understand, from studying the provisions in the White Paper, that what we face now is diametrically opposed to what was contained in it. If I were him, I would not call on the White Paper to aid my arguments.

Mr. Lord : Is not that the issue that is causing all the confusion? My hon. Friend was making a point about the referendum, but that was held on the European Economic Community--the common market. The people of this country voted for a common market, and that is what they understand. They did not vote for anything else, which is why--

The First Deputy Chairman : Order. It might be a good idea for the Committee to return to the subject of institutions.

Mr. Cash : Although my hon. Friend's argument is important and reasonable, because of the difference between the arrangements that we entered into between 1970 and 1975 and those in the treaty, the key point about this part of the Bill is that European institutions would be granted increased powers which would cover all aspects of government, whereas in the 1975 referendum we voted primarily on trading arrangements.

Another aspect of the question of institutional powers is the degree of independence of the Commission. Throughout Europe, institutional arrangements are moving towards more power for unelected and unaccountable officials, who will determine questions that should be determined by the people of the respective countries. That is one reason why there is so much anxiety about the Maastricht treaty and the way in which those powers have been growing. Unelected and unaccountable bankers, Commission officials and members of the Court of Justice are included in the provisions. Some Members wish to ignore that but the treaty significantly increases the powers of the Court of Justice, the Commission and the other bureaucratic institutions.

There is no question of the powers of the European Parliament filling the democratic deficit that is being created, and there is no doubt that the powers of bankers and the Court of Justice are increasing. Some hon. Members are dealing with such issues, but there is no evidence that Ministers and many other hon. Members appreciate the extent to which they are handing over the running of this country to people who have not been elected and will not be

accountable--people who do not necessarily have any interest in the way in which we are governed.

Mr. Stuart Randall (Kingston upon Hull, West) : The hon. Gentleman is trying to create the illusion that there will be no constraints on the shift in power from member states to the Community. He has not mentioned article 3b and the way in which powers will be constrained. I refer him to the words :

"The Community shall act within the limits of the powers conferred".

The text also makes it clear that the onus of proof that powers should be removed from member states is on those who would remove them--not the other way around. That represents an important restriction on the ability to shift powers, and the hon. Gentleman has not referred to it at all.


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Mr. Cash : The results that the hon. Gentleman hopes for from subsidiarity will not be forthcoming. By definition, subsidiarity assumes centralisation ; otherwise, there would be nothing to which it could apply. It is a cosmetic exercise : it is a con trick. It is an attempt to give the impression that there will be a greater diffusion of powers to lower levels, whereas in practice the real concession is to the centralising tendencies of the unelected Commission, Court of Justice and bankers. There will be far less opportunity for subsidiarity to take effect than the hon. Gentleman would like. From all the areas in which exclusive competence has been granted under the treaty to these institutions and bodies, subsidiarity is automatically excluded, so there is little to which it can be meaningfully attached.

People are running around trying to tear up, for the time being, several European directives, but they are not changing the powers being granted under this treaty--a treaty which will greatly increase the powers both of the institutions and of the Community itself. I regard this group of amendments as yet another reason for my decision, already taken, that I do not want us to ratify this treaty, which is centralising, undemocratic, authoritarian and socialist in all its main characteristics.

7.30 pm

Mr. Shore : I have wondered at times during this two and a half hour debate whether we have focused clearly enough on the question of the institutions. I shall try to be brief and to the point. Against the background of a treaty of a federal character, which is what this treaty is, it is inevitable that the institutions set up under the Rome treaty and subsequent treaties and under the treaty of union should be strengthened. The powers of the union, the powers of the quasi-state, are expressed, after all, in its institutions. The institutions which most clearly reflect the federal character of the treaty are the European Parliament and the Commission.

I turn first, however, to the Council of Ministers. Both it and its powers are certainly affected by what is contained in the Maastricht treaty. Virtually the only safeguard that the nation state has against encroachment by Community powers under the Rome treaty is the unanimity rule--that is to say, the rule under which the agreement of all Ministers representing member states has to be obtained before a directive becomes law and before policy is implemented.

The trouble is that the unanimity rule is being weakened all the time-- first, and unfortunately, under the Single European Act. I shall not go into a great debate about that, but under it the rule was removed from a whole range of areas, especially those affecting the creation of a single market.

The Maastricht treaty removes the unanimity rule from areas of policy to which it used to apply--and from all the areas listed under article 3, for which new competence is handed over to the European Community.

Mr. Hoon : The treaty as originally drafted provided for qualified majority voting. The unanimity rule to which my right hon. Friend refers was developed in a form known as the Luxembourg compromise by member states ; it was a practice, not a rule in the way that he implies.


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Mr. Shore : I respect my hon. Friend's knowledge of the treaties, but I think that he will find that, apart from the famous Gaullist Luxembourg compromise, the treaty of Rome contains far more articles requiring the unanimity rule than articles requiring qualified majority voting. We need not argue too long about that, however. The important thing is to note the new areas of Community competence. First there are the old ones : agriculture, fisheries, transport, common commercial policy, free movement of goods, persons and services. Then there are the new areas : economic and social cohesion, environment policy, research and technology development, development of trans-European networks, health protection, contribution to education and training, policy in the sphere of development co-operation, contribution to the strengthening of consumer protection, and energy, civil protection and tourism measures. Nearly all these are new policy areas brought under the qualified majority voting procedures as developed under articles 189b and 189c of the Maastricht treaty.

It follows that the ability of a Minister on the Council of Ministers to veto developments, given the new and wider areas of treaty competence, has been removed. Ministers can no longer veto or demand unanimity. Wherever qualified majority voting is agreed, the powers of national Parliaments to hold Ministers to account are virtually abandoned, because Ministers can always turn up and say, "I did my best but I was outvoted by a qualified majority vote ; I could not stick to the position which I know my own Parliament wanted me to retain."

As we are to deal separately in another debate with economic and monetary union and with all three stages thereof, I need not do more than mention the qualified majority voting in economic and monetary union, which is also enshrined in the treaty. That union covers matters of great importance.

I want to mention the powers of the Commission and also to focus mainly on the European Parliament. The powers of the Commission are also extended to all the new competences established under the Maastricht amendments to the Rome treaty. The Commission retains its powers as sole initiator of policy and its responsibility for enforcement. In one area, as my hon. Friend the Member for Hamilton (Mr. Robertson) mentioned, under stage 3 of economic and monetary union the Commission is given powers of a formidable kind. They are powers to propose fines and penalties for member states when it is held that they are in breach of treaty obligations. That will lead to an interesting shift in the power relations between the Commission and the Council of Ministers.

The most important changes, however, are in the powers and procedures of the European Parliament. My hon. Friend the Member for Hamilton began referring to the right of petition and the establishment of the office of ombudsman. Those are trivial powers, and I do not believe the European Parliament needs the Maastricht treaty to establish such rights and offices. Indeed, petition rights are already in force, so I thought it rather odd to concentrate on the most trivial of all the increased powers given to the European Parliament.

The more important aspects of the European Parliament's powers are the procedures under articles 189b and 189c of the treaty. Under article 189b, the so-called co-decision procedure greatly elevates the powers of the European Parliament in relation to the Council of


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Ministers and to the Commission. Henceforth, under article 189b--this includes those matters which are to be resolved by the procedures set out in the article--the European Parliament will have the right to reject a Council proposal, whether it is a majority, a qualified majority or a unanimous decision. The Parliament will have the right to reject the proposal outright by means of a majority vote of its Members. After all procedures have been exhausted, the European Parliament still possesses the right--on Third Reading, as it were--to vote down a Council proposal.

As the Committee will know, a conciliation committee is to be established, with equal numbers from the Council of Ministers and the European Parliament, to negotiate differences between the two bodies when amendments have been proposed and not accepted. This represents a substantial shift of power in favour of the European Parliament. Extension of powers will not stop there. It is interesting and significant to read paragraph 8 of article 189b, which states : "The scope of the procedure under this Article may be widened, in accordance with the procedure provided for in Article N(2) of the Treaty on European Union, on the basis of a report to be submitted to the Council by the Commission by 1996 at the latest."

There we have it. By "1996 at the latest" there will be brought forward to the Council a proposal for changing or developing further the procedure of co-decision. Undoubtedly, the Council will be in favour of enhancing the powers of the Parliament.

Mr. Hoon : Does my right hon. Friend accept that in practice the powers of the European Parliament to which he refers, because they are negative, are extremely difficult to exercise? If the European Parliament rejects a legislative proposal, that is the abandonment of, probably, many years of legislative effort. The existing powers to reject legislation have seldom been exercised.

Mr. Shore : The European Parliament has the power to stymie the Council of Ministers. I think that I agree with my hon. Friend because I believe that this will be an unsatisfactory procedure. I am not in the least surprised, therefore, that provisions are already in place to allow for further amendment and development, which I think will be along the way that I have suggested--increased power for the European Parliament.

Given the importance of the new procedure for co-decision under article 189b, and taking account of the long periods--three months and an additional six weeks--allowed for reaching agreement between the European Parliament and the Council of Ministers, I and others have tabled new clause 21, to which I draw the attention of the Committee. It requires that a report shall be made to the United Kingdom Parliament whenever a common position agreed by the Council of Ministers has been rejected by the European Parliament but is still within the negotiating frame. The new clause will give the House of Commons a decent opportunity to question and challenge Ministers on their policy and on the new policy that they intend to adopt in the light of a veto, or the threat of a veto, by the European Parliament.

Mr. Tam Dalyell (Linlithgow) : I ask my right hon. Friend a question from the pro-European position. Given


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his experience as a distinguished Secretary of State for the Environment--one of the successful ones of the past two decades--does he accept that there is an argument for having a European- based policy on pollution which can be enforced? We know from the east German experience that pollution knows no frontiers.

7.45 pm

Mr. Shore : The strongest case is the environmental one, but I put it to my hon. Friend that there is an entirely unthought-through division, as it were, of responsibilities for environmental matters now in the hands of the Community which should reside in the United Kingdom. We must decide whether we are to have more roads running through the United Kingdom. Similarly, we must determine our policy towards flora and fauna and the protection of them. That is our responsibility, and we should exercise it. Unfortunately, we sometimes fail to do so. We should not hand over such powers to a European body.

On the other hand, there must be some shared responsibilities--for example, the regulation of shipping in the channel. I suspect, however, that most of the environmental matters that my hon. Friend and I are concerned about are not for determination by the Community. That is because they are international matters. We must reach out and make major decisions and agreements on the ozone layer and other issues that concern us as citizens of the United Kingdom, of western Europe and of the world. We have a responsibility, and that should influence us. The idea that all these matters should be crammed into or transferred to a European body is nonsensical.

Mr. Garel-Jones : I am listening carefully to the right hon. Gentleman, who is touching on something that is of importance to the Committee and, indeed, to the House of Commons. He is talking about how the House of Commons will scrutinise and undertake its level of responsibility in all matters European. The right hon. Gentleman will know that it is rare for an element of procedure to be included in an Act of Parliament. The right hon. Gentleman's argument surprises me because he knows that appropriate Standing Committees have been established, which are doing their work. The House of Commons may wish to improve on those Committees as it gains experience. I would be surprised to see a piece of legislation--an Act of Parliament which is essentially a European Act of Parliament to do with

Europe--dictating the procedures of the House of Commons. That which the right hon. Gentleman is suggesting may be sensible--indeed, it is the proper route for the House of Commons to take--but it does not need to be told to follow it in an Act of Parliament. I would contend that such a measure would slightly inhibit the House of Commons.

Mr. Shore : The Minister is advancing an argument similar to the one that he adduced earlier when he said that he did not understand why any Act or any intervention should be introduced or made to take place which bore on our procedures, even if it meant the simple requirements of an annual report and a debate. I do not agree. The accountability of Ministers when operating in a European context should be made plain at an early stage. I agree that


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much can be done by implementing the procedures of the House of Commons, and those procedures should be clear in our minds at that early stage.

Mr. Garel-Jones : Will the right hon. Gentleman give way?

Mr. Shore : No, I will not. It is a relatively small point. It is not the substance or essence of the matter, which rests with the powers of the European institutions.

Mr. Dykes : Will the right hon. Gentleman give way?

Mr. Shore : No, I shall be rigorous.

I have quoted from articles 189b and c, which are important, but I want to look further ahead. Anyone who has followed the debates and resolutions of the European Parliament can have no doubt about its ambitions for the structure of the European union which it so tirelessly advocates.

In a resolution passed on 7 April 1992--after the Maastricht treaty had been signed in Maastricht--the European Parliament gave its verdict on the treaty in one of the enormously lengthy resolutions that it passes and clearly foreshadowed its future course of action. The task, as it put it, was to

"transform the network of relations between the peoples and member countries into a European Union on a Federal basis, based on a draft constitution drawn up by the European Parliament in co-operation with the National Parliaments."

The resolution was approved by a clear majority of the European Parliament, to which the Institutional Affairs Committee, as it is called, reported.

Mr. Rogers : My right hon. Friend draws attention to the recent resolution on the intentions of the European Parliament. However, since 1979 when the directly-elected Parliament came into existence, there have been similar resolutions on a number of occasions, the most famous of which resulted in the adoption of the Spinelli report in the early 1980s, which set out a blueprint for European federalism and is the basis of the Single European Act and the European Communities (Amendment) Bill. There is no doubt at all about the intentions. Whether one agrees with them is another matter.

Mr. Shore : It is important that we do know what the intentions are. Federalism is not the recessive part of the European movement, but the dominant part. Federalism is openly espoused on the continent of Europe in virtually every country and it has the backing and blessing of most governmental leaders of the member countries of the EC.

The resolution continued--I quote again because it is important--as follows :

"to begin already preparations for a new revision of the Treaties which would aim to eliminate the shortcomings of the Treaty of Maastricht."

No time is to be wasted. Maastricht has not yet been ratified. Finally, it instructs its Institutions Committee

"to complete its preparation of a draft constitution for the European Union."

That was in April 1992 and the European Parliament has moved on since then. The main work has been done by its so-called Institutions Committee and its report on "Structure and Strategy" for European union was agreed by the European Parliament as recently as 20 January this year. Once again, I think that the House should be given some information on the content of that document.


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Mr. Gapes : My right hon. Friend will know, because we were at the same meeting a few weeks ago with members of the institutions committee of the European Parliament, that that was the aspiration. As my right hon. Friend said earlier, that had clearly been the aspiration for many years. Nevertheless, it is clear that a change in the treaty will require an inter -governmental conference and a process in 1996 or 1997.

Mr. Shore : Yes, we know that. I am simply making the intention plain to the House--the fact that it has the support of the majority of the European Parliament, the fact that the same federal thrust is backed by the Heads of Government of most of the countries of the EC, and that it is perfectly plain to everyone except the Government and their supporters that that is the real intention. All the people who are serious about federalism in Europe and want it do not deny that for a moment. That is true of the hon. Member for Inverness, Nairn and Lochaber (Sir R. Johnston). He is a federalist, recognises federalism when he sees it and does not try to hide the consequences of what we are doing. I much respect his position, but I have no respect at all for those who pretend and dare not face the British people and the House with the real purposes that they have in mind.

Mr. Dykes : Will the right hon. Gentleman give way?

Mr. Shore : No.

Mr. Dykes : On a point of order, Mr. Lofthouse. The right hon. Gentleman said that he would be rigorous and not give way. He has now given way to two colleagues but will not give way to a Conservative Member who has a legitimate question.

The First Deputy Chairman : The hon. Gentleman knows full well that that is not a point of order for me. It is a matter for the right hon. Member for Bethnal Green and Stepney (Mr. Shore) whether he gives way.

Mr. Shore : I want to develop some of the main points contained in the document on "Structure and Strategy" for European union. It is of interest to the House to know the following. With regard to the Council of Ministers, the document says :

"its development into a second legislative chamber in the sense of a genuine chamber of states and alongside the European Parliament must be accelerated, with it becoming a standing body of the Union, its meetings on legislative matters held in public and taking majority decisions and co- decisions and on an equal footing with the European Parliament."

Those words are particularly important. So the Council becomes a second legislative chamber.

With regard to the Commission, the document says :

"it must hold Executive power in the European Union and as such must manage the Union's affairs on the basis of the European Union's Laws"--

and so on. There is no question about the Commission. Its powers are there. It is to be the executive and the authority.

With regard to the European Parliament itself, the document says : "it must collaborate with the Council on the basis of equal rights and powers in all spheres in which the European Union has legislative competence and with respect to all decisions concerning revenue and expenditure."

Further, and most significantly, it must have

"considerably enhanced control over Foreign and Security policy it should be given the right of assent with respect to all fundamental common foreign and security policy


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decisions, in conclusion of international treaties and all decisions adopted unanimously by the Council in the framework of the European union."

My hon. Friend the Member for Ilford, South (Mr. Gapes) reminded me that the Select Committee on Foreign Affairs recently took evidence from five members of the European Parliament representing the institutions committee of the European Parliament. It became clear from our exchanges that they were envisaging a federal constitution for the European union, modelled closely on the federal German state with the nation state occupying the role of the German La"nder, with the European Parliament fulfilling the role of the Bundestag and representatives of the nation state serving in an upper chamber similar to the Bundesrat. That is the very shape and outline not merely of a constitution but of a familiar federal structure. That is quite interesting. As I say, that was the MEPs' strongly supported view.

We had some exchanges earlier--I shall not go far into the subject--on subsidiarity and people misunderstanding what is meant by federalism. There is no misunderstanding of what is meant here. It is similar to the German or American systems which we know all about. There is a national assembly, in the case of the Americans, and there is the Bundestag in the case of Germany. Those are the sovereign parliamentary bodies. In both cases, in the Senate and the Bundesrat, there are representatives of the 51 or so states and the different La"nder. It is a familiar picture.

Mr. Dykes : Does the right hon. Gentleman agree that that comparison falls short of the essential components? He has mentioned the Bundestag, the Bundesrat and the La"nder, but there is no Bundesregierung--no central government entity. The sovereign member states represented in the right hon. Gentleman's equivalent of the Bundesrat or the upper house, a legislative and policy-forming body, are the sovereign member Governments working freely and voluntarily together in agreed treaty structures, but they remain essentially sovereign member Governments.

Mr. Shore : The only thing missing from the picture is the government. That is the thing that we have not located. We have the two houses. We have the federal distribution of power, and there is no misunderstanding about what federalism is--the transfer of major strategic powers to the new level of government and central institutions such as banks. The missing link is the government. It is clear that the European Parliament and its members who are considering the matter are still uncertain whether the Commission will remain the executive of the new state and whether the President of the Commission is to be drawn, like the German Federal Chancellor, from the European Parliament--that is certainly one road which some members of the institutions committee strongly advocate--or whether he should be elected directly like an American president. The missing component in the federal structure is the government itself and the authority that the presidency derives either from direct election or from the merging, being one of the members of the majority party in the European Parliament.

That is how the majority of MEPs see the future. They have at least one coercive weapon, the use of which is actively being discussed now : they have the right of


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approval or veto on new member states seeking to join the EC. The European Parliament is saying that enlargement, which it knows certain countries, including the United Kingdom, are keen on, even of the EFTA applicant countries, will not be allowed unless the federal constitution of the union that it is drawing up, or something close to it, is adopted.

Mr. Marlow : Will the right hon. Gentleman give way?

Mr. Shore : No, not for the moment.

All that is made clear in the report of the Institutional Affairs Committee, to which I previously referred, in which it called for "an inter -governmental conference to be convened before 1996 and before any decisions are taken on enlargement and to be given a brief to start this process with the involvement of the European Parliament, on the basis of the draft Constitution of the Union in such a way as to ensure that the Union can absorb other European States while strengthening its cohesion, its ability to take decisions and its democratic legitimacy."

8 pm

Mr. Garel-Jones : Is the right hon. Gentleman aware that in his pursuit of ghosts and phantoms he is reading the equivalent of an early-day motion?

Mr. Shore : I am not pursuing ghosts or phantoms. I have a little more respect for the European Parliament than the right hon. Gentleman. I occasionally listen to what it says and read the resolutions that it passes. I reject many out of hand, but this report was prepared by the Institutional Affairs Committee and approved recently by a majority in the European Parliament. In addition, we know that the treaty allows for a new intergovernmental conference by 1996. Under article 189b it has already taken on board the fact that the arrangements agreed at that conference will not be sufficient and will have to be developed further. The Minister cannot say that these are ghosts. That will not do. It is time that he spent a little more time thinking about what is going on in Europe instead of telling us a lot of rubbish about how he saved the day for Britain with his clauses on subsidiarity and his two pillars to the treaty. Mr. Garel- Jones rose --

Mr. Shore : I shall not give way to the right hon. Gentleman again.

Mr. Marlow : Does not the European Parliament have one overriding objective--to acquire more power? Whatever powers it has it will use to acquire more power, and if we give it more power under the treaty it will be in a stronger position to gain even more power.

Mr. Shore : It works slightly differently. We are persuaded to agree to an increase in the competence of the Community by which we lose control over our policies, especially those decided by qualified majority voting. We then say that our Ministers are no longer responsible to our Parliament, at which point the European Parliament says : "There is a democratic deficit, which we should be looking after." That is part of the process of transferring power and the ambitions of the European Parliament. I do not blame it for having such ambitions, which are understandable. Indeed, it would be soul-destroying to be


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a member of the European Parliament unless one wished to see the emergence of a federal state in western Europe controlled largely by the European Parliament.

Mr. Hoon : I am a little concerned that, in describing the Institutional Affairs Committee of the European Parliament, my right hon. Friend is unintentionally misleading hon. Members. For many years, the Institutional Affairs Committee has proposed a series of blueprints--the Spinelli report, which has been mentioned already, was an example--but what resulted in practice was far short of the blueprint that my right hon. Friend describes. Perhaps, to some extent, he needs to put in context what has happened.

Mr. Shore : My hon. Friend makes a fair point, but he must see the Maastricht process in the context of the profound historical developments which have made the thrust to federalism the dominant factor in the Community. The two Germanys have joined together, and the united Germany wishes to enmesh itself in the rest of western Europe. The French, out of fear of a united Germany, are all too anxious to place cords and restraints on Germany, and therefore are prepared to abandon their "Europe des patries" position and advocate federalism in a way which seemed inconceivable three years ago. Against that background, we must judge the movements and initiatives of the European Parliament.

The European Parliament plans to prevent enlargement of the Community by refusing to sanction a further treaty which admits new members. The Institutional Affairs Committee specifically says that it

"disagrees with the view expressed in the conclusions of the Lisbon European Councils of 27 June 1992 that enlargement of the Union to include those EFTA states wishing to accede should be completed without further institutional reforms."

The European Parliament has rejected that. The Lisbon conference recommendation or assertion that it would proceed with enlargement before institutional reform is now explicitly rejected by the Institutional Affairs Committee.


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