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us, and nor was it easy for the Government. It must be very galling for a Government to rely for certain things on a minority party. I must say that the Government Chief Whip and the pairing Whip, the hon. Member for Boothferry (Mr. Davis), were straight and courteous with us throughout. I say that because it is true. Nevertheless, it was odd that the Foreign Secretary made no reference to the fact that we have reached this point tonight because we did all that. The Conservative and Liberal parties were engaged in ferocious local government contests at the time in question and the Newbury by-election was held then as well. It was not easy for everybody, but it was all achieved.

I am told that there were dungeons beneath the Government Whip's Office, in which Euro-sceptics hung from chains in dank, miserable darkness, although I never saw them. The House is always going on about how marvellous it is to have independently minded Members of Parliament who speak their minds. Sometimes when they do that, men in big boots come and try to trample them down. There is something contradictory about that.

The main issue was the social chapter. We shared Labour's objective of manoeuvring the Government into the position where they had to choose between having the Maastricht treaty with the social chapter or no Maastricht treaty. That may yet be achieved by new clause 74. It has been a strange experience, watching an elected Parliament being denied the chance to make a decision on a issue about which it wants to make a decision. In fact, it was all very unreal. If one compares the treaty of Rome as amended by the Single European Act and its social chapter, with the social chapter of the Maastricht treaty, one sees that there is no profound difference between them. The Prime Minister had to return from Maastricht with some triumphs, so he said that he had saved us from creeping corporatism and creeping continental socialism.

The right hon. Member for Old Bexley and Sidcup (Sir E. Heath) put his foot gently into Denmark for a moment when he made a few slightly grumpy remarks, which called forth thunderbolts of various kinds from the right hon. Member for Henley (Mr. Heseltine). The right hon. Member for Henley said that all the competition from the far east would force on the other countries of the European Community the attitude that his party adopts with regard to social conditions, wages, and so on. But the right hon. Gentleman cannot have it both ways. If pressure from the European Community is to have this effect, what is the problem about signing the social chapter? There is no problem. I do not understand that attitude.

In one of the best speeches of the entire Committee stage, the hon. Member for Chingford (Mr. Duncan Smith) clearly and incisively made the point that, even if the social chapter were not signed, competition policy would result in our arriving at the same destination. The right hon. Member for Old Bexley and Sidcup said the same thing a few moments ago. If competition is seen to be unfair, someone will certainly bring the matter to the European Court. We should certainly do so were we to find ourselves in that position. Then there is the question of federalism. This is another illusion. There are many mirrors here. The Prime Minister came back from Maastricht and said that this fearful word had been excised. But that does not make a dock leaf of a difference. The Foreign Secretary dredged up a quotation from a recent speech by Chancellor Helmut Kohl. Well,

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Chancellor Kohl makes many speeches of some length, but they are certainly consistent. We all know perfectly well that it is nonsense to pretend that the Chancellor of Germany is not a committed federalist who believes that federalism means decentralised government.

As the right hon. Member for Old Bexley and Sidcup knows better than most, it does not finish there. The next stage of the argument will be about how the show is to be run constitutionally. This will include proportional representation. I resent the attitude of those who say that PR is of no importance or significance. It is both significant and important. It is about democracy. I deny totally the idea that it is a trivial matter. In the entire European Community, together with countries in what was the European free trade area, this is the only country that does not have a fair voting system. Please let us have no more such comments about proportional representation.

I do not intend to say much about European monetary union. I shall not spend a great deal of time on currency convergence and banks.

Mr. Shore : I think that the hon. Gentleman is referring to remarks that I made. So that there may be no misunderstanding, I should say that I am not necessarily opposed to a referendum on the future of our electoral system. I was referring to the incredible lack of proportion between those who can find it in their hearts to argue that we should have a referendum before changing our system of voting but, at the same time, would deny us a referendum on the Maastricht treaty, which is of far greater importance.

Sir Russell Johnston : The right hon. Gentleman is certainly entitled to his views, but I could hardly feel any less represented in the European Community than I feel now, and have felt for many years. Thus, the right hon. Gentleman is not entirely entitled to say what he has just said.

On the question of European monetary union, I do not see how we can have a single market without a single currency. However, the timetable will have to be revised. I gather that Luxembourg is now the only country that meets the criteria. Changing timetables is nothing new. The European Community has operated on that basis all along. If timetables are not set, one does not do anything. If one cannot keep to a timetable, one stops the clock. But the clock cannot be stopped for ever, and after time the only way to move forward is to make another timetable.

The Government have argued for Maastricht less on the basis of its content than on the basis of the exceptions that they managed to achieve. That is hardly a clarion call. More seriously, they simply, in effect, reject the idea of further effective democratic integration. The Foreign Secretary made that very clear. The Government believe that, somehow, it is possible to have an effective working Community with a good deal of provision in respect of the environment and in other fields--with a single market--and, simultaneously, to retain the old sovereign state with all its powers more or less unimpaired. That cannot be done.

This is a very important point. The Government talk about changing little things. It seems to me that what has been missing throughout recent stages of this debate is a grand design, a hope, an aim, an ideal--something to work for.

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Mr. Austin Mitchell (Great Grimsby) : It is called survival.

Sir Russell Johnston : The hon. Gentleman makes the point that it is about survival.

What about the hon. Gentleman's party--the Labour party? No doubt it, too, is interested in survival. The Labour party's spokesman explained at some length why he would not vote for the Third Reading. I did not find his argument very compelling. What sort of leadership is that? I read the magazine of the House of Commons occasionally. The other day I read in that publication an article by the hon. Member for Hamilton (Mr. Robertson), who may have written it in the hope that nobody would read it--we all do that sort of thing. He said that we must have a single currency and a central bank. He has not made that point very loudly in the Chamber.

What do Liberal Democrats want? We believe that a single market is good, but that it cannot work without a single currency, an agreed social policy and common rules on competition and regional regeneration. Only in that way is it possible to achieve growth and employment. We believe that a coherent community needs a common foreign and defence policy to solve internal problems and achieve external influence--internal problems like Yugoslavia ; external influence with the United States and Japan.

We believe in a strengthened European Parliament, fairly elected, at the democratic heart of the Community. It must certainly relate to the Council of Ministers, as that is the nature of a federal approach, but it must act openly. We are supranationalists, whereas the Government are intergovernmentalists. That is a basic difference, and the argument will be rehearsed again and again over the coming months and years.

The Maastricht treaty refers to the role that transnational political parties will increasingly play. That is the way forward for Brits and Germans and Dutch and Danes. They will not be in any way ashamed--indeed, they will be particularly proud--of their distinctive cultures, languages and history, but they will co-operate in respect of economic, political and social matters across national divides. In determining these issues, national divides are not the central concern. We want the common good in Europe, and that is what we shall continue to work for.

6.9 pm

Mr. Tim Renton (Mid-Sussex) : It is a pleasure to follow the hon. Member for Inverness, Nairn and Lochaber (Sir R. Johnston) and, indeed, my right hon. Friend the Member for Old Bexley and Sidcup (Sir E. Heath), who made a powerful and compelling speech. I have slightly less confidence in the effectiveness of the 204 hours and 23 days of debate than was demonstrated by my right hon. Friend the Foreign Secretary and by the right hon. Member for Copeland (Dr. Cunningham).

I was not here for all the debates, Madam Deputy Speaker, but I was here for quite a few of them, and when I look back on them I wonder precisely what we have achieved. True, we have turned a Bill that was one and a quarter pages long into a Bill that is one and a half pages long. I have to be careful in saying this, because I know how much this House treasures its privileges and its place as the mother of Parliaments and the mother of democracy, but one reason why so many people in Britain

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became so determined and anxious to have a referendum was, I believe, because they thought that we were wasting a great deal of time on trivia.

There were times when the legal significance of our debates seemed to be totally incomprehensible to many of those outside the House. That is why the cry for a referendum, which I do not agree with, was magnified. That is the lesson that we have to remember, if this Parliament is to be convincing in future debates of such enormous constitutional importance.

If we are to convince the outside world that our debates are of great significance, it is important that we do not waste time--by, for example, the hon. Member for Bradford, South (Mr. Cryer) spying strangers at 3 o'clock in the middle of the night and leading between 450 and 500 grown-up men and women back into the Chamber on a farcical excuse. How can one mention that sort of incident to politicians and friends on the continent and then pretend that we in this House are treating the Maastricht treaty with all seriousness? When behaviour of that kind is reported, it seems like a farce. I hope that one of the benefits of this long debate is that we reform our procedures by the time of the next intergovernmental conference so that the mother of Parliaments, this Westminster Parliament that we all love so much, regains respect. When we have the son of Maastricht treaty, which is only four years away, I hope that we shall debate it fully in a two or three-day debate and that at the end of that debate we, like the French or the Spanish, will come to a firm conclusion and decide whether to ratify the treaty, or otherwise.

As my right hon. Friend the Member for Old Bexley and Sidcup said, the great issues are now unfolding before us as a result of the Maastricht treaty and the Bill that we are to ratify, I hope by a very large majority, tonight. The first of those great issues is the exchange rate mechanism. That question will not go away. What we have to consider, and what I am sure my right hon. Friends on the Treasury Bench must consider, is how we are to reform, with our continental friends, the processes of the exchange rate mechanism so that we, and the Italians, can join it again.

According to the treaty, on 1 January 1994, a mere seven months away, stage 2 of the process towards economic and monetary union starts. Under stage 2, we are committed to moving the Bank of England to independence from political control. One has only to read article 109e, paragraph 5, to see that. I hope that we shall take that course early on. When I look at countries with independent central banks--notably the United States and the Federal Republic of Germany--I see, despite the hiccups in Germany at present, that those countries have shown over decades consistently higher rates of growth since 1945 than we have.

One conclusion must be that bankers, not politicians, are better at deciding questions of monetary growth and consequential interest rates. It is not necessarily that they have better brains than we have, but they do not have to operate within the same electoral four-year-cycle as we do.

My hon. Friend the Member for Aldridge-Brownhills (Mr. Shepherd)--I am sorry that he is not in his place at the moment--made a key intervention and, with his typical trenchancy, said that the important thing now is to have a more democratic Europe, with proper controls over

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what is done in Brussels and Strasbourg. I am convinced that the way that we shall achieve a more democratic Europe is by a deeper examination of the powers of the European Parliament.

Next year, the European Parliament holds its elections. We, surely, have to be ready with our decisions and our thoughts about the increase in the powers of that Parliament in good time for the 1996 intergovernmental conference. So many times in the past few months I have heard, as many other hon. Members must have heard, the comment, "I believe in Europe, but I don't like the Maastricht treaty. Despite subsidiarity, if I understand what that means, the treaty adds to the scope of and provides the Commission with too many new powers." Even those of us who believe strongly in Europe cannot arrogantly brush away that criticism.

So what is the answer? It must lie in more democracy within a powerful Community for the European Parliament and greater accountability and openness in the Council of Ministers. That is one of the problems for this Parliament of ours at Westminster. We have never really come to accept the European Parliament. We have to learn not only to live with it but to realise that it is not just a talking shop. It must become, and we must help it to become, a more effective brake on the Commission and, at times, on the Council of Ministers. Inevitably, that will mean more power and control moving from his House, not to the Commission--that is the Whitehall, the civil service of the Community--but to the European Parliament. I realise that that is a difficult concept for hon. Members to accept. I accept it. Our task, after ratification of this treaty, over the next three years is to examine how that can effectively be done. What are we to give to the European Parliament? Are we to give more power to investigate the management committees? Are we to give it First, Second and Third Reading powers over all new policy areas where there is majority voting in the Council of Ministers? These issues will have to be examined. What we cannot do is to demand more democracy within the Community and yet not seriously consider the question of how to make the European Parliament work more effectively.

We must certainly also consider the role of the Council of Ministers. How can we help it to act more visibly, more transparently, so that what the Council of Ministers does can be seen by the constituents of the member states of the Community? I realise that the Danes have tried that. They held a few open or televised sessions of the Council of Ministers. It did not work too well, but that is no reason for giving up the experiment. The thoughts and conclusions of the Council of Ministers must be seen to be openly and freely available to their European constituents.

Slowly, therefore, we in this House have to come to terms, while we look for more democracy, with the fact that we are part of the continent of Europe. Let me remind the House, before I sit down, of the famous words of John Donne :

"No man is an Island, entire of itself ; every man is a piece of the Continent, a part of the main ; if a clod be washed away by the sea, Europe is the less".

Britain, we all know, will always be an island, but reluctantly we have to accept that in the 21st century we shall inevitably and inextricably be part of the European continent as well. Our job in this House is to merge those two ideals--insularity and European statehood.

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6.19 pm

Mr. Peter Shore (Bethnal Green and Stepney) : I am conscious of being the first Member to speak in this Third Reading debate who hopes that the Bill will be negatived. Hon. Members have spoken well, but regardless of what side of the House they have spoken from they have all seemed to send out the same message.

The reality is that, in this year-long debate, we have witnessed the unspoken alliance of the leaders of all three political parties and their joint determination to ratify the Maastricht treaty. Labour Front-Bench spokesmen have made their points about the social chapter, but, as we shall see later, they are quite willing to accept the Maastricht treaty even though it does not contain a social chapter. It was interesting to hear my right hon. Friend the Member for Copeland (Dr. Cunningham) defending himself against accusations of Labour-wrecking, as it were, and saying that the Labour party could have destroyed the Maastricht treaty on many occasions if it had wanted to. My God, I wish that he had wished to do just that. If he had, he would have earned the thanks of a large proportion of the British people--including, I am glad to say, as he will soon find out, the great majority of ordinary Labour party members, supporters and trade unionists.

Dr. John Cunningham : The reason why we did not want to do that is quite simple : it was not the policy decision that was taken by our conference, which my right hon. Friend refuses to accept.

Mr. Shore : I have never taken the view that, on matters of major constitutional and political importance, my decision about how I should vote in the best interests of my constituents, my party and my country should be dictated by a majority vote at our annual conference--never. That is the doctrine to which I hope every member of the Labour party would subscribe. We take note, we take seriously and we consider what our annual conference ha

It is exactly a year since the Second Reading debate. It has been an interesting and important year. Taking full account of the last Danish referendum--I do not think that there will be a third one, but perhaps the best of three might be the way of deciding it--I wish to say how profoundly grateful I am to those sturdy people in Denmark who value self-government and independence in their own country to the point where they turned over their own political establishment and voted no. Their referendum of 2 June gave people, not only in Britain but all over Europe, the chance to think again and to look far more searchingly into what their political leaders had committed them to.

As we all know, what emerged across Europe was the recognition that there was indeed a classe politique--the professional Europeans, the professional politicians who were dedicated to the European idea and ever closer European union. For example, the right hon. Member for Old Bexley and Sidcup (Sir E. Heath) is now an open federalist. There are disguised federalists, too, many of whom feel that it is imprudent to state too early what the real objective is. For example, the Foreign Secretary denies what is on the face of the treaty and does not recommend

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to the House what everyone else in Europe thinks it contains but says that Britain has not gone along with certain things and how remarkably successful the Government have been in negotiation. I think that they have had some successes in negotiation. They have not signed up for stage 3 of European monetary union. I should have thought that that was a matter of congratulation, but I find that Labour Front-Bench spokesmen want stage 3 of EMU as well ; they are not content with what they are getting.

It is especially on the economic side that the gravest damage is to be done --not only to our economic interest and the British people but to the people of Europe as well. I shall devote most of my remarks to that matter, but let no one have any doubt that my feelings are equally strong about the transfer of powers, the loss of self-confidence and the willingness of Members of Parliament, in this of all Parliaments, to hand over the powers of their constituents and their country to alien institutions abroad and to abide by the decisions that are made there.

Let me deal with the economic issues, which greatly disturb me. Last year, 16.2 million people were unemployed throughout the Community--about 9.3 per cent.--but today the figure is 17.5 million, or more than 10 per cent. According to a Commission report, the outlook for growth in the European economy in 1993 is 0.7 per cent., which, as the House will well know, is quite insufficient to sustain the present level of employment. Productivity in the European Community is currently growing by roughly 2.5 per cent., but unemployment will increase next year because it is forecast that production will grow by only 0.7 per cent. In addition, the more recent forecast of the International Monetary Fund expects growth within the European Community to be 0.1 per cent. this year. The recession is biting deep. The Chancellor of the Exchequer, who gave figures for Germany and other European countries, knows only too well how industrial production has collapsed in many countries. The European Community faces a very serious problem. Everyone, especially those who are feeling the burdens of recession, is saying, "We are trapped. We want to do something. Why cannot we have programmes and policies to expand the economy and combat rising unemployment?" We all know the reason why. No European Community country can set interest rates lower than the Bundesbank's base rate, which is just under 8 per cent. Interest rates in other member states must therefore not be lower than 8 per cent.

Japan and America, which are not as badly afflicted as Europe, are worried about recession. What are their interest rates? Are they 8 per cent.? Not a bit of it. Both have rates which are less than 3.5 per cent. That is part of the difference. Why cannot European countries lower their interest rates and enormously boost growth, employment and so on? Because they are stuck in the exchange rate mechanism, and the treaty tries to keep them in it. Only the markets, operating in the most tumultuous way, can change their treaty obligation to maintain exchange rates in the fixed parity. It is quite crazy.

The only country, as the Chancellor well knows, that has partially escaped and whose growth prospect this year is better than 0.1 per cent. is Britain. Our growth prospect is 1.6 per cent. That is nothing to cheer about, but it is all right compared with the rest ; and we have the lowest interest rates in the European Community. Ours are lower

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than Germany's, which my right hon. and learned Friend the Member for Monklands, East (Mr. Smith) did not believe was possible. I well remember asking him in earlier debates, "What is the use of having sovereignty in the sense of control over interest rates and exchange rates? It means 25 minutes of freedom before adjusting to fall into line with the Germans"--

Mr. Deputy Speaker (Mr. Geoffrey Lofthouse) : Order. The right hon. Gentleman's time is up.

6.29 pm

Sir Cranley Onslow (Woking) : I welcome the Third Reading of the Bill, for which I firmly intend to vote. I hope that the House will not forget that--as my right hon. Friend the Foreign Secretary said--the treaty was not of Britain's seeking. Of course we could not turn our backs on what had happened at Maastricht, but it was inevitable that the Prime Minister was faced with a damage limitation exercise, and he and his colleagues in the Government deserve our thanks for the skill and persistence with which they have conducted it. The same cannot be said of the Bill's opponents, from whichever party. Conservative opponents of the Bill will receive no thanks from me today.

I am not prepared to go as far as my right hon. Friend the Member for Old Bexley and Sidcup (Sir E. Heath), but it will be a long time before some of us forget the disgraceful sight of corridor conspiracies being conducted with the Opposition Chief Whip aimed solely at frustrating the business of the Government whom the hon. Members involved were elected to support. I can understand that hon. Members may be slow to forgive colleagues who sloped into the Opposition Lobby, then sought to blame the Government for spending so much time on the Bill. I must say in his absence that it surprises me that my hon. Friend the Member for Reigate (Sir G. Gardiner) still seems to be regarded by the press as the true voice of the loyal right.

However, those are side considerations. The rebels have marginalised themselves and will find themselves in curious company in the Lobby tonight. But that is their affair and need not worry the House as a whole-- it is more important to look forward. Much has happened since the first day of Maastricht. There have been significant changes in Europe and we need a few agenda. I am delighted to have had the Prime Minister's testimony that rejoining the exchange rate mechanism is not on the agenda for Britain. I warmly welcome the statement that he made yesterday on the BBC when he said that the conditions for considering re-entry--let alone re-entry itself--do not currently apply. I believe that they are unlikely to do so for a long time.

The enlargement of the Community must be a high priority, and I have no doubt that the Government will press actively for that. I am also sure that we can rely on my right hon. Friends to press on with their campaign against the over-regulation that the Community has inflicted on us and which our own bureaucrats have so often succeeded in compounding. We must finish spring cleaning the nooks and crannies that my right hon. Friend the Foreign Secretary identified a while ago.

Just as we must ensure that unnecessary rules and regulations go, so we must ensure that all our partners

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comply with necessary rules. The latest report of the Select Committee on Trade and Industry highlighted sectors in which Government action is still needed to secure fair competition, eliminate illegal state aids and ensure a level playing field. I hope that that task is high on Whitehall's agenda.

Whatever the agenda, hon. Members must never forget that they have been chosen to represent Britain's interests. Our purpose in seeking to be at the heart of Europe is not to try to dominate Europe, as France and others have always feared that Germany would. It is right to seek to make the most of our own skills and strengths, which is why it is vital that we should not allow ourselves to be shackled by the social chapter.

At a time when our industrial costs are lower than those of Germany, why does the Labour party want us to throw away that advantage? Does it believe that to do so would strengthen our economy or create more jobs? We can only prepare ourselves to face the mounting competition from outside Europe if we are strong enough to compete inside Europe. I can illustrate how intense world competition is likely to become. Last week I heard of a firm in Germany that has decided to relocate its research facility in India because the top rate for a computer programmer in Bangalore is one tenth of that in Berlin. Against such a background, we must identify the fierce competition that we are about to face.

Another major change since the Maastricht process began is the recession that the Germans have entered. I expect that, being Germans, they will have a good--or, should I say, thorough--recession. France is threatened by the same sort of force, although, under its new Government, it has a better chance of surviving it. Those factors show why we have every reason to reject the millstone of the social chapter.

My hon. Friends and others who seem to fear that the treaty will lead to outright political union in an inevitable super-state in Europe should not forget the lesson of Bosnia. What is happening in the former Yugoslavia poses a potential threat to peace in the whole of Europe, and we must not ignore it. But simply because Britain is fortunate enough to have the best Army in Europe, it must not allow itself to be cast in the role of Europe's policeman. We must sometimes work with others, but we must not surrender sovereignty over our armed forces or the rights of the House. I am sure that the Government recognise that.

Bosnia can only provide a damage limitation exercise for Europe, just as Maastricht has been for Britain. If we are sensible enough to see things as they are, we shall realise that there is still a great deal that we can achieve to build the sort of Europe that we want. Tonight's vote is a necessary step towards that goal.

6.35 pm

Mr. Tony Benn (Chesterfield) : Tonight's vote on Third Reading will have a pre-set majority. But not one hon. Member has the legal or moral authority to hand over the powers that they borrowed from their electors last April to people who will not be accountable to those whom we now represent. Not one of us put the Maastricht treaty before the electorate last year, because it was not then published in English. We offered them no choice--the Labour party, without any conference authority, decided to support the treaty. I know that the Labour party had no authority,

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because the Maastricht treaty was negotiated after the conference, which intervened before the manifesto was written.

The problem for those who are passionate about Europe is that they cannot offer this country to Europe. Only half the seats in the Chamber are occupied for tonight's debate and the Opposition intend to abstain in the vote. If I were a passionate federalist--which I am not--I would feel more concerned about tonight's vote than anyone else. If others in Europe say that we have supported them, it is not true. The House of Commons, under the Whips, the patronage, the discipline and the disillusionment, has supported them, but not the British people.

A democracy consists not merely of a mechanism of becoming elected and passing a law. It contains the responsibility of gaining the continued consent of the electorate. At the next election I shall have to say to the people of Chesterfield, "Vote for me and I shall fight for you, but do not vote for me to deal with your agricultural, environmental, trade or even foreign policy, and certainly not your economic policy." We are handing over the British people, without their consent, to a system that has replaced parliamentary democracy, which we have been told is the justification for what we are doing tonight.

Would the House have been entitled to take Britain into the United States of America, join the Warsaw pact or invite in Soviet troops without a referendum? Of course not--nobody would believe that for a minute. We have experienced a coup d'etat by a parliamentary elite, not only in this country, but in the whole of Europe. They have abandoned their tasks as representatives and become the managers of Europe.

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

Mr. Benn : I should love to give way to the hon. Gentleman, but I have an argument that I want to advance and I have only 10 minutes in which to do so.

The House has given up its power, because it has lost interest in its role. I do not think that the House of Commons wants power any more ; it has traded status for power. Hon. Members now get on the television and are introduced as the right hon. Member for Chesterfield or whatever, but they do not want power. For them, status is much more important.

The Labour party has adopted a completely new philosophy--that of being in government when not in government. We now have shadow Ministers--the French call them "phantomes", which is appropriate. I heard that my right hon. Friend the Member for Manchester, Gorton (Mr. Kaufman) went to Paris and Le Monde called him le secretaire d'etranger phantome de Britannique. I can imagine people placing entries in "Who's Who" such as "Phantom Prime Minister 1983-1992". We shall have a phantom queen next, who will call for Buckingham palace to be open for two or three months a year at £9.50 a tour. We have abandoned our representative role, and the same is happening in every country. It is that crisis that lends support to a Ross Perot and Le Pen. As Members of Parliament, we do not represent people ; we hope to manage them. If we cannot manage them, we pretend that, if we were to manage them, we would do it better than the Conservative party.

During the election, the Chancellor appeared on a Labour poster as Batman. I thought that it was a Tory

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poster, trying to make him more attractive to younger voters. What is the point of abuse when there are matters of substance to discuss, such as how to solve unemployment, what sort of Europe we should have and what new world order? We have abandoned all those issues. I must not be controversial--that is not my practice--but my party, in supporting the Maastricht treaty, has abandoned everything for which the party was established. Others may take a contrary view. The Labour party believed that people had the right through the ballot box to control those who made the laws and, by getting a majority, to change the economic system under which they lived. However, the party has now given it all up. I am not saying that it has done so out of wickedness ; it was out of a lack of self-confidence.

I do not think that members of Labour's Front Bench would have even two ideas about what to do with the economy if they came to power, other than with a central bank. I say this with some regret, but a series of sound bites glued together and called an economic policy is not an economic policy. That is the problem-- [Interruption.] I am sorry to speak sharply, but, if this is my last speech in a free Parliament, I had better say what I think and take the consequences. I bitterly resent the title "Euro-sceptic". Am I an "Anglo-sceptic" because I did not like the Thatcher Government? I oppose the Maastricht treaty as a European because it takes from every country in Europe the rights that are being taken away from us. It does not offer durability. The treaty has divided every country in Europe--Denmark went one way and then the other, France agreed by a narrow margin and Ireland by a bit more, but in Britain the people are not allowed to vote.

Let no one tell me that proportional representation to put people in an impotent Parliament within a European federation merits a referendum. That is an utterly disreputable argument, and no one will believe it. Labour does not want to have to put to the Labour movement and the public the arguments for the Maastricht treaty and European union, because it knows that those notions would not win support.

A moment ago, someone said that 83 per cent. of the people in Germany want a referendum and two thirds wish that the Danes had voted no. The treaty will fail ; that is the tragedy. I shall get no satisfaction from its failure, but it will fail because it cannot be made to work. When it fails, a Bosnian-type crisis will emerge, because one can no more impose capitalism from Brussels than communism from Moscow. It cannot be done--you must carry people with you.

That is why I suggested a commonwealth of Europe, a looser arrangement where harmonisation is by consent. I believe that the crisis in the former Yugoslavia would be much less serious if we had a commonwealth of Europe in which it could find a place without having in place of the iron curtain a gold curtain or a deutschmark curtain, which means that, if one cannot fit in with the policies, one is not acceptable.

I hope that the House will forgive me for speaking with passion. I have often wondered whether, when we lost democracy in Britain, it would be to the red army, the Militant Tendency or Oswald Mosley, but in fact we ourselves have given it up. The House has agreed to abandon its responsibility to hold to account those who make our laws. We have given it all up. Walter Bagehot

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said in the 19th century that the British constitution was divided between the dignified and the efficient. He said that the Queen was the dignified and that the Commons was the efficient. The Executive is now the efficient, and we are the dignified.

We no longer want power. We do not care whether it goes. The nation accepts that because, after centuries of subservience to a monarch whom we cannot elect or remove, we are trained to be subservient. If we learned to live with William the Conqueror, we can learn to live with Jacques Delors. People have been trained--there is a culture of bowing and scraping, going to another place with my Lord this or my Lord that. The nation has never been allowed to develop the equality that comes with birth, to govern oneself as one thinks right and then to collaborate, harmonise and co- operate with other nations. The idea of one country living alone is absurd. We could be killed by a Chernobyl nuclear disaster or destroyed by a nuclear weapon from China. There is no national sovereignty, but there is a right to choose and remove the people who make our laws. When we vote tonight, under the discipline of the Whips and the patronage system, which is also a corrupting influence, the House will abandon that which makes it a focus of interest and attention for generations of people, from the chartists and the suffragettes until now.

In 1970, we permitted the vote at 18. The meaning of the vote was taken away on 1 January 1973. There were two and a half years of the right of the electorate, but it was too dramatic a power and the Government, without a referendum, took it away. I regret the fact that my right hon. and hon. Friends now hope that they will get more justice from Jacques Delors than from the Government. It is not a policy which any progressive party could pursue.

6.44 pm

Sir Peter Hordern (Horsham) : We have spent more than 200 hours in Committee, mainly debating legal interpretations of the treaty. I shall refer to some of the economic issues and especially to what one might call the intelligent Garrick club member arguments. Those arguments are as follows : first, that Britain belongs to the weakest of the three major trading groups in the world, secondly, that during phase 2, all countries will be required to reduce their deficits to specified levels and there will be determined effort to implement the single currency ; and, thirdly, that we shall transfer economic policy from elected Parliaments to non- elected institutions and that the European central bank is insulated from democracy. It was because of that authoritarian power that Charles I lost his head. On the first point, we need not doubt that economic growth is faster in the far east and likely to be faster for some time in the United States. I do not know whether we are supposed to try to become a member of the American free trade area or its equivalent in the far east, but such a suggestion would be as absurd as it is impractical. We do not need to weaken ourselves by leaving the European Community in order to invest in the United States or the far east, which we already do rather more than any other European country.

We must have the resources to invest in the rapidly growing parts of the world, which means that we cannot

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afford to weaken ourselves. I fear that that would happen if we failed to ratify the treaty. We have attracted huge amounts of inward investment in recent years, especially from the United States and Japan, and only because we are full members of the European Community. We have attracted some £2,000 million from the Japanese alone, who have employed 70,000 extra people. As a result, we expect our balance of trade in motor vehicles to be in credit within two years and to double car production within the next five years. As the House will know, a survey was recently carried out for the Confederation of British Industry by an economic research institution. It showed that, if we did not ratify Maastricht, about 47 per cent. of American and Japanese major investors would cease to invest in this country. That is real evidence rather than a matter of legal interpretation, which has been bandied around the House in recent weeks.

Mr. Cash : Will my right hon. Friend give way?

Sir Peter Hordern : No, I shall not give way, because, as my hon. Friend knows, time is limited.

Sixty per cent. of our trade is with the European Community. We need a strong home base, which the Community provides, to increase our investment in the United States and the far east. We also need to bring down the tariffs and to make a success of the GATT round. I cannot see how we can make a success of it unless we are a full member of the European Community, negotiating with fellow member countries to bring down the tariffs all over the world and, in particular, in the United States. We can influence the negotiations only from within the European Community.

The second proposition is that, during phase 2, all countries will be required to reduce their deficit to specified levels. I do not think that there is any truth in that. Indeed, the treaty states that, in phase 2, we must

"endeavour to reduce excessive deficits"--

a praiseworthy and commendable thing to do.

As for deficits, the House knows that all European countries, with the possible exception of Luxembourg, are way outside those limits. Belgium-- which I suppose is the keenest federalist of all--has a financial deficit of 6.7 per cent. and a debt of 130 per cent. of GDP rather than 60 per cent. Italy has a financial deficit of 10.5 per cent. and growing, and a debt of 105 per cent. The

Netherlands--another very federalist country--has a debt of 80 per cent.

Are we seriously to believe that in the next two years those deficits will be reduced by half? Is it seriously to be considered that those countries will cut their public spending by half in the next two to three years, or double their taxation? It is a ludicrous idea. Only an academic, lost in an ivory tower, would believe any such thing. We do not believe in signing up to such an arrangement and hence, very sensibly, my right hon. and hon. Friends have secured the opt-out from that arrangement.

I think that we ought to consider why these convergence factors are in the treaty at all. It is likely that the Bundesbank, the German people and the German Parliament--all of whom have to ratify the single currency and will have the final say--are not happy to abandon the deutschmark. It is quite understandable that, if they are to accept the single European currency, they will demand at least as stringent conditions as are currently applied to the deutschmark. I think they are right to do so. If there were ever to be a single currency, the conditions set out in the

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treaty would be sensible ; but it is simply not going to happen, because the terms and conditions in the treaty cannot conceivably be met.

The proposition is that the European central bank would be somehow insulated from democracy, and that never in the course of our long island history have we ever been called upon to sacrifice our sovereignty in this way. That is absolute nonsense. Ever since we were on the gold standard, from 1660 onwards--and again under Peel's Bullion Act of 1819--more often than not we have been tied to the gold standard or some other fixed currency. In more recent times, under the Bretton Woods agreement, we were completely fixed to the United States dollar for 22 years, and in that time our monetary policy was conducted not within the Bank of England but by the Federal Reserve of the United States.

If, by any chance, hon. Members should say that that was a deplorable time, I would mention the fact that interest rates were commonly about 3.5 or 4 per cent. at that time, inflation was about 3 per cent. and unemployment about 500,000. Those were halcyon days. I do not see any difficulty, in practice, in our tying ourselves to another currency.

As many of my right hon. and hon. Friends know, for some time I have favoured an independent Bank of England. Many opponents of the Maastricht treaty would like to blame our membership of the ERM for the recession. I say to them that it is worth remembering that, before we joined the ERM, interest rates had been at 15 per cent. for a whole year and at about 14 per cent. for a year before that, and that inflation was at 12 per cent. That was the position before we joined the ERM. We did not join it because of any great enthusiasm of Baroness Thatcher for the European Community ; we joined it as a way of dealing with inflation. In that respect at least, it was extremely successful ; it brought inflation down from 12 to 5 per cent., and interest rates fell from 15 to 10 per cent.

Of course, it can now be argued in retrospect that we ought to have joined the ERM sooner--I believe that we should have done--and that it might have been very much better if we had devalued the currency within the ERM. There is no case to be made for a floating currency without any regard to other currencies. If we float our currency, it invariably floats downwards, and up goes inflation. That is the record of the last 20 years : there is no denying it. It is not surprising that foreign holders of sterling--to whom we are extremely indebted at the moment, having to borrow some $50 billion- -demand a very high price for it, as they will if they think there is any doubt about the level of sterling.

Whether in currency or in trade matters--as in defence or foreign affairs-- we cannot act as an island alone. Whether in the GATT negotiations on the negotiations for an enlarged Community--which I think we all wish to see we need to be at the heart of Europe to help steer it in the right direction, and that is why I am in favour of ratifying the treaty.

6.54 pm

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