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Mr. Radice : I appreciate that my hon. Friend the Member for Dagenham (Mr. Gould) is enthusiastic about the issue. He likes to read into every word of the treaty some terrible thing that is about to happen. In fact, it does not say "zero inflation" but "price stability", and I do not see anything wrong in price stability.

Mr. Mandelson : My hon. Friend the Member for Durham, North (Mr. Radice) is saying that it is proper and legitimate for price stability to be a primary goal for an independent central bank to pursue. But it is not the only goal. There are other goals and other policy imperatives, and no doubt attention will be given to them all. It is up to Ministers and other politicians to decide among those goals, but it is proper for the central bank to try to pursue that goal of price stability.

Mr. Radice : I could not put it better myself. A carefully defined set of powers will be in the hands of the central bank-- [Interruption.] There are other powers--for example, on exchange rate policy--in the hands of the European Council. Fiscal policy is in the hands of nation states, except in so far as there are common rules and procedures, as there should be, if there is to be a common European policy.

Sir Teddy Taylor rose --

Mr. Radice : I will not give way. There is too much noise [Interruption.] --and I would not be able to hear the hon. Gentleman.

The Chairman of Ways and Means (Mr. Michael Morris) : Order. The Committee should be courteous to the hon. Member for Durham, North (Mr. Radice) and listen to his words.

Mr. Radice : It has been said that economic and monetary union always works to the disadvantage of the poorer regions of Europe. That is true, which is why there is a cohesion fund and structural funds. I agree that they are not yet big enough-- [Interruption.] --and there is in place a framework in which it is possible to deal with some of the disadvantages that arise from a single currency and economic and monetary union.

Much has been said about operational independence. There is a strong case for that, of which the model of the Bundesbank is a good example. Of course, the Bundesbank works from a history different from ours. It works from the experience of Weimar, when the politicians debauched the currency. That is why people in Germany are greatly concerned to have a stable price regime-- [Interruption.] --and why the Bundesbank is a popular organisation. Indeed, it has been shown to be the most popular organisation in Germany. It must be said that, in Germany, bankers are more popular than politicians. I do not see anything wrong with having an independent bank or an independent European bank, and I do not see it as anti-democratic.

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Like my hon. Friends, I shall argue for the strengthening of ECOFIN, a European Commission and the strengthening of the power of the European Parliament. I do not see anything wrong with operational independence or the beginnings of the accountability features in the Maastricht treaty. The question which arises is whether EMU will happen. Of course that is not certain. It is possible that competitive devaluation--

It being Ten o'clock, The Chairman-- left the Chair to report Progress and ask leave to sit again.

Committee report Progress.

Motion made, and Question put forthwith, pursuant to Standing Order No. 14 (Exempted business),

That, at this day's sitting, the European Communities (Amendment) Bill may be proceeded with, though opposed, until any hour.-- [Mr. Nicholas Baker.]

The House divided : Ayes 296, Noes 279.

Division No. 203] [10 pm

AYES

Adley, Robert

Ainsworth, Peter (East Surrey)

Aitken, Jonathan

Alexander, Richard

Alison, Rt Hon Michael (Selby)

Alton, David

Amess, David

Ancram, Michael

Arbuthnot, James

Arnold, Jacques (Gravesham)

Arnold, Sir Thomas (Hazel Grv)

Ashby, David

Ashdown, Rt Hon Paddy

Atkinson, David (Bour'mouth E)

Atkinson, Peter (Hexham)

Baker, Nicholas (Dorset North)

Baldry, Tony

Banks, Matthew (Southport)

Banks, Robert (Harrogate)

Bates, Michael

Bellingham, Henry

Beresford, Sir Paul

Blackburn, Dr John G.

Booth, Hartley

Boswell, Tim

Bottomley, Peter (Eltham)

Bottomley, Rt Hon Virginia

Bowden, Andrew

Bowis, John

Brandreth, Gyles

Brazier, Julian

Bright, Graham

Brooke, Rt Hon Peter

Brown, M. (Brigg & Cl'thorpes)

Browning, Mrs. Angela

Bruce, Ian (S Dorset)

Bruce, Malcolm (Gordon)

Burns, Simon

Burt, Alistair

Butterfill, John

Campbell, Menzies (Fife NE)

Carlile, Alexander (Montgomry)

Carlisle, Kenneth (Lincoln)

Carrington, Matthew

Channon, Rt Hon Paul

Chapman, Sydney

Churchill, Mr

Clark, Dr Michael (Rochford)

Clarke, Rt Hon Kenneth (Ruclif)

Clifton-Brown, Geoffrey

Coe, Sebastian

Colvin, Michael

Congdon, David

Conway, Derek

Coombs, Anthony (Wyre For'st)

Coombs, Simon (Swindon)

Cope, Rt Hon Sir John

Cormack, Patrick

Couchman, James

Critchley, Julian

Currie, Mrs Edwina (S D'by'ire)

Curry, David (Skipton & Ripon)

Dafis, Cynog

Davis, David (Boothferry)

Day, Stephen

Deva, Nirj Joseph

Devlin, Tim

Dickens, Geoffrey

Dicks, Terry

Dorrell, Stephen

Douglas-Hamilton, Lord James

Dover, Den

Duncan, Alan

Dunn, Bob

Durant, Sir Anthony

Dykes, Hugh

Eggar, Tim

Elletson, Harold

Emery, Rt Hon Sir Peter

Evans, David (Welwyn Hatfield)

Evans, Jonathan (Brecon)

Evans, Nigel (Ribble Valley)

Evans, Roger (Monmouth)

Evennett, David

Faber, David

Fabricant, Michael

Fairbairn, Sir Nicholas

Fenner, Dame Peggy

Field, Barry (Isle of Wight)

Fishburn, Dudley

Forman, Nigel

Forsyth, Michael (Stirling)

Forth, Eric

Foster, Don (Bath)

Fowler, Rt Hon Sir Norman

Fox, Dr Liam (Woodspring)

Fox, Sir Marcus (Shipley)

Freeman, Roger

French, Douglas

Gale, Roger

Gallie, Phil

Garel-Jones, Rt Hon Tristan

Garnier, Edward

Gillan, Cheryl

Goodlad, Rt Hon Alastair

Goodson-Wickes, Dr Charles

Gorst, John

Grant, Sir Anthony (Cambs SW)

Greenway, Harry (Ealing N)

Greenway, John (Ryedale)

Griffiths, Peter (Portsmouth, N)

Grylls, Sir Michael

Gummer, Rt Hon John Selwyn

Hague, William

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