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Baroness Chalker's extra 10 weeks would have taken the deployment date to 10 September, but it is now 17 November. What has happened to the promised deployment of those 5,500 troops? It is still two battalions short. After six months, an Indian battalion and a Zambian battalion are still to be deployed in Rwanda, yet apparently our troops are being withdrawn. In the strange way of UN peacekeeping forces, a contract between the United Nations and the Brown and Root company to provide logistical support has not yet been finalised. The problem is not troops-- troops are available in the world for peacekeeping operations--but political will and logistical support and command. The Foreign Secretary said nothing about how we would improve that. There can never be an effective UN operation anywhere in the world unless that logistical support is provided. Today, the right hon. Gentleman boasted that 565 British troops were deployed in Rwanda. When we last debated the issue in July, our commitment to Rwanda was 50 trucks.

What fills me with apprehension is that the defeated Rwandan army is now reorganising in Zaire and will resurface. It is disturbing that the UN seems to learn nothing from these operations. The French, rightly or wrongly, proved how quickly they could deploy their forces in Rwanda. They said, "We are going in" and they went in within days. In the Gulf over the summer, Saddam Hussein stirred again and there was no problem about logistics. The UN must be equipped to react. We must stop talking about UN reaction unless we mean it. The problem of logistical support must be solved.

Almost three years ago, the UN Secretary-General Boutros Boutros-Ghali highlighted the problem and said that the UN had no stock of logistical equipment. It must place orders with manufacturers so that it can get its army moving. He said that Governments should commit themselves to keeping certain equipment on immediate standby and agree to make airlift and sealift capacity immediately available to the UN.

We must go beyond that to what was called, in "Agenda for Peace", peace enforcement units, which should be immediately available for the UN to deploy. The United Kingdom has to agree that such facilities are available. However, we must go even further beyond that to a UN standing force of people who are recruited to serve the UN and to be available for the UN to deal with issues as they arise. We cannot continue to commit people to peacekeeping forces when it takes seven or eight months for them to be deployed in a constantly deteriorating situation. Over the summer, the Foreign Secretary said that he had put forward some ideas to achieve that. I do not think that he has. The Government have proposed nothing to show how the matter could be dealt with more effectively.

I was disappointed by the right hon. Gentleman's remarks about arms sales. There was no serious tackling of the issue. He often appears to be Olympian and statesmanlike, but on this issue he descended into run-of-the-mill politics, such as saying that we must think about the workers in the British arms factories. If every statesman in the world took the same approach, no progress would be made. It is a serious problem. Unfortunately, Britain has too great an economic dependence on arms sales. The right hon. Member for Tweeddale, Ettrick and Lauderdale (Sir D. Steel) referred to figures that show an enormous concentration of export credit guarantee facilities for the expansion of arms sales.

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The Foreign Secretary is not credible in his protestations that there are no links between arms sales and British aid. His defence appears to be that he was surprised by the Pergau dam affair-- that he would not have made the decision that was made, but that he had to honour commitments given by people before him. He suggested that there was but a brief entanglement of arms sales and aid. I caution the right hon. Gentleman that no one outside the Government is convinced on the Indonesia issue. It is transparent that there has been an expansion of aid to Indonesia at a time when, in all logic, it should have been falling.

I say that because, first, the number of exceedingly poor people in Indonesia has fallen gratifyingly over the past quarter of a century; secondly, Indonesia's access to international private finance markets is not a problem; and thirdly, according to Government policy, good governance should be a consideration--no one could say that the Indonesian Government are anything other than foul in their dealings with East Timor. What other country or part of the world could anyone name where there is a suspicion that a third of the population has been killed during the past 20 years?

Mr. Gallie: I accept some of the hon. Gentleman's comments. However, is he really suggesting that no one outside the Government would accept trade in arms with Indonesia? Is he aware of pressure from British Aerospace, which has a factory in my constituency, and which makes no bones of the fact that the arms trade with Indonesia is important to that company both within the United Kingdom and at Prestwick?

Mr. Worthington: I accept the hon. Gentleman's point, which was made by the Foreign Secretary. What is the logic of the hon. Gentleman's position? It is that he has no moral stance on the sale of arms anywhere in the world. That is not acceptable to the Opposition. The hon. Gentleman would sell arms anywhere, to anyone, at any time. That is not good enough.

The Secretary of State for Defence (Mr. Malcolm Rifkind): The hon. Gentleman had better be careful when he makes such a claim. Is he aware that the shadow Defence spokesman has publicly supported the sale of arms to Indonesia?

Mr. Worthington: Yes, I have been here throughout the debate and I heard that point being made earlier. I am surprised that the Secretary of State needs to repeat it.

We must consider the issue of arms and aid. It is bad enough selling arms, but to link that with sweeteners and aid is even worse. According to the Secretary of State's own figures, of about 15 major long-term bilateral aid projects funded by the Overseas Development Administration and costing more than £20 million, not one goes to sub-Saharan Africa, not one goes to Africa apart from one to Egypt, but four go to Indonesia. Those are real soft-term loans. Nothing is paid back for a seven-year grace period and the rate is 3.5 per cent. after that. That is a direct linking of arms sales and aid. The Foreign Secretary has been visibly bruised by Pergau. He is a man with some decency and honour. It is interesting how much he stands out as a light on the Conservative Benches. He has been bruised by, and feels

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ashamed about, Pergau. The Foreign Secretary should have another quick look and open all eyes about Indonesia and all other countries. It is not possible to say that arms and aid are not linked. We often get into crises and then ask what we can do. The right hon. Member for Tweeddale, Ettrick and Lauderdale mentioned Kenya, with which we have the closest of links. Some ask what are our links with Rwanda, Somalia or Indonesia, but there can be no doubt that we have strong links with Kenya, not only in terms of exports but much more so in terms of traditional links with people.

The Foreign Secretary has talked about preventive diplomacy. I particularly want to mention Kenya today because President Moi is in the country and I want to express my intense concern about the condition of that country. There is no doubt that President Moi has no commitment to multi-party democracy--rather, it was forced on him by the donors. That has often been admitted. We should be exercising preventive diplomacy in Kenya. Do hon. Members know that about five years ago Britain received 50 applications for refugee status from Kenya, but in the first month of this year we received 800 applications for refugee status? The warning signs are there. Baroness Thatcher--not Baroness Thatcher, she is a moment or two down the road-- Baroness Chalker referred to the importance of good governance.

Mr. George Foulkes (Carrick, Cumnock and Doon Valley): That would not be Thatcher.

Mr. Worthington: I promise my hon. Friend that I am about to mention Baroness Thatcher as well. A fortnight ago in Kenya President Moi opened the £9 million Margaret Thatcher library at Moi university, fulfilling a pledge that she gave in 1987. Beware pledges given by Baroness Thatcher because they come back to haunt one. How many pledges did she give? President Moi opened the Thatcher library--

Mr. Ernie Ross (Dundee, West): One book.

Mr. Worthington: It is funny that my hon. Friend should say that. President Moi immediately launched a nationwide appeal for books because there were none. There has been a collapse of services within Kenya. Should our aid budget be going into major capital projects in the university sector when it is generally agreed that places such as Kenya desperately need primary and secondary education? Those services are collapsing and the ordinary people of Kenya can no longer afford school fees.

More important than that, our aid budget says that it is in favour of good governance, but last year university staff in Kenya went on strike for 10 months because they were not allowed to form a staff union. There is no academic freedom in Kenya. No research can be conducted in Kenya without the approval of the President's office. All senior appointments are made by the Government. Academic standards are falling as funding ceases. The average class size is 500 and there is enormous corruption in that section of the economy. The Government control what is taught and who teaches it. As the right hon. Member for Tweeddale, Ettrick and Lauderdale said, there is no academic freedom, just as there is no separation of the judicial system from the state

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system. There is no freedom of association and expression. I was also amazed to find that in Kenya an Opposition Member of Parliament has to have permission to hold any kind of meeting. Such meetings can be stopped by a state functionary. One quote reads:

"We can no longer meet as academics. When we try to do so we are dispersed by armed police even in the privacy of senior common rooms."

What demands are we putting on Kenya with regard to human rights? What does the opening of the Margaret Thatcher library at Moi university by President Moi say about the way in which Britain is propping up a regime that we should not be propping up, when what we should be doing is emphasising academic freedom alongside all the other freedoms that we should be encouraging in Kenya and elsewhere? It is about time that we got our aid budget on-side with regard to human rights. There is too much going round at the moment about our aid budget being linked with arms sales and repressive regimes. Rather than what it is promoting at the moment, it is about time that we used our aid budget to promote the good and noble in the world. 7.7 pm

Dr. Robert Spink (Castle Point): I count it a privilege to be able to contribute to the debate on the Loyal Address. It is also a privilege to follow the hon. Member for Clydebank and Milngavie (Mr. Worthington), who spoke with great force on the UN peacekeeping operations and on wider issues. However, I could not say with honesty that I agree with everything that he said.

I shall, with permission, review three areas--first, Northern Ireland from the viewpoint of defence; secondly, the European Union from the viewpoint of foreign policy; thirdly, from the viewpoint of defence and foreign policy, a particular and pressing point of conflict in the world which is important to Britain--Cyprus. First, on a general note, I congratulate the Government on an excellent Queen's Speech, which could not in any way be called uncontroversial. It outlines a dynamic and ambitious legislative programme, which will build on past successes in the economy, industrial relations, foreign and defence policy, health care and the environment.

The programme will achieve two important objectives. First, it will continue the improvement of the economy's supply side; secondly, it will build on the far-reaching and successful Conservative social reforms in areas such as pensions, removing discrimination against disabled people and caring for the sick and mentally ill and for genuinely vulnerable people. We live in historic times. Who would have thought that Gerry Adams would be here today, in the mother of Parliaments?

The solution to the Northern Ireland problem has eluded all Prime Ministers this century, except, I hope, one. When my right hon. Friend the Prime Minister declared last year that Northern Ireland was to be his top priority, I thought that he had stuck his neck out a little too far. Do not get me wrong: I thought that he was absolutely right, but that he was rather brave. We know that the charge of great bravery is one that politicians do not seek when setting policy.

My right hon. Friend the Prime Minister has made tremendous and historic progress and great credit must go to him personally, above all others. That is not to belittle the important contributions of the hon. Member for Foyle (Mr. Hume), Albert Reynolds and others.

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The Downing street declaration, based firmly on principles of democracy and consent, led directly to the IRA ceasefire on 31 August and to the cessation of loyalist paramilitary operations on 13 October. It promises eventually full-blown peace, notwithstanding the current political crisis in Dublin and the Irish Prime Minister's resignation.

One key issue to be resolved in Northern Ireland is the future of paramilitary weapons. I urge the Government to continue to pursue a co- ordinated approach with whoever takes power in Dublin in future, to achieve the removal and decommissioning of guns and explosives. I welcome the proposals to pursue a Northern Ireland Assembly and to produce a joint framework document to promote clear and soundly based relationships between the two peoples and Governments. Most of all, I welcome the fact that the constitutional guarantee remains, and will remain, rock solid.

As my right hon. Friend the Prime Minister told the House yesterday, there are formidable tasks ahead, but each day without violence is another small victory for Northern Ireland. The benefits of peace for the people of Northern Ireland are overwhelming. Right hon. and hon. Members in all parts of the House must wish my right hon. Friend the Prime Minister well in his historic and brave endeavours. All should recognise that his personal strength, quiet determination and foresight have brought about a unique opportunity for lasting peace in Northern Ireland.

As to foreign policy, I ask my right hon. and learned Friend the Secretary of State for Defence to estimate, when he winds up, the impact on the important Anglo-American alliance of the recent US elections. The people of America voted overwhelmingly for conservatism, less government, lower taxes and less state dependency--for individuals to take greater responsibility for themselves and their families. In a nutshell, America voted for greater freedom and for conservatism. I suspect that that will have a significant impact on America's foreign and defence policy and on the Atlantic alliance.

I rely on the old adage that what comes to pass in America one year often comes to pass in Britain a year or two later. Britain commands great influence in the world far beyond that which we might expect, given our country's size, industrial prowess or even military might--although man for man, our armed services are the best in world. We exert that influence because of our unique culture, traditions, history, language, and worldwide recognition of the quality and value of our national institutions.

Britain's special position was not secured and maintained by chance but results from consistent, sound Conservative policy through the 1980s and 1990s, when Labour would have squandered the country's position through nuclear disarmament and other short-sighted and mistaken policies. Labour would have destroyed, or at least threatened, Britain's position as one of the Security Council's five permanent members, through the party's defence, European and international policies.

Britain's special position is good for the world order. It is a positive international force for stability, democracy and the development of free markets which will lead the world from tyranny and poverty. I despair when Britain's position and status in the world are threatened and

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continually eroded by a short-sighted and self-indulgent media, often led by one of our greatest institutions--the BBC.

The media have done great damage to all our major institutions--the monarchy, Church, judiciary, industry and even Parliament. It is truly among the least corrupt Parliaments in the world, but it is derided and denounced by the media as thoroughly corrupt, which it is not. Right hon. and hon. Members in all parts of the House are honourable, even if some are occasionally foolish and forgetful.

Mr. Peter L. Pike (Burnley): Despite the hon. Gentleman's remarks about the BBC, does he not agree that the BBC World Service has the finest reputation of any broadcasting service in the world? The hon. Gentleman does the BBC an injustice.

Dr. Spink: I am indebted to the hon. Gentleman, because I entirely agree that the BBC World Service is one element in Britain's special world status--something which we should cherish but which we often undervalue.

By damaging Britain's world standing, the media undermine our foreign policy. They are often led by a Labour party that surpasses other political parties only in its ability to denigrate our nation and institutions. That is one reason why socialists remain unsuitable for government.

At this point, I will cross party political lines and call on the Government to enhance Britain's position and status in the so-called new world order, by taking an early decision to rejoin UNESCO, which would do so much to help world development. The Government should make that positive move, and before the American Government. I ask my right hon. and learned Friend to describe Government policy on UNESCO when he winds up.

As to Britain's position in the European Union, I am pro the European Economic Community. I voted for it. Unlike Mr. Blair and many Opposition Members, I have been consistent.

Mr. Deputy Speaker (Mr. Michael Morris): Order. The hon. Gentleman should know the rules of the House by now.

Dr. Spink: I am grateful for your advice, Mr. Deputy Speaker. Unlike the right hon. Member for Sedgefield (Mr. Blair) and other Opposition Members, I have been consistent in my view of Europe, which focuses on two fundamental benefits. I do not apologise for restating the fundamentals, because they can become lost in the trivia and minutiae. They are worth restating.

The first great benefit is that Europe has delivered and continues to deliver peace, stability and democracy where they did not exist previously. I would sacrifice almost everything in life before I would sacrifice my three boys on the battlefields of Europe. The promotion of peace, stability and democracy are benefits of the European Union that are too little explained, understood, celebrated and valued by right hon. and hon. Members.

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The second benefit is economic. It is measured in terms not of cost alone but of the cost benefits of our membership of the club of Europe, of improved living standards for all people in society--the poor and the better off, young and old alike--and of jobs for workers.

Our membership of the European Union and our membership fee help to create a more stable Europe which can be a model for, and can influence positively, the stability and development of the wider world. I want that, so I will vote for the European Communities (Finance) Bill. I see relieved expressions among my right hon. Friends on the Government Front Bench. I am sure that my loyalty was never in doubt.

As for the future development of Europe, I seek an enlarged, deregulated, free-trading economic community--one in which rules are applied equally and fairly in each member nation, and in which fraud is policed equally toughly in all.

British Conservatives have played a major and positive role in the development of Europe in recent years. It was our Government who introduced budgetary discipline and fraud policing in the first place. We introduced the common agricultural policy reforms, which must go much further. We introduced the single market and enlargement. Those were British Conservative initiatives of which we can be proud.

My right hon. Friend the Prime Minister rightly recognises that Britain is irrevocably part of Europe and that it should be at the heart of Europe, but it must be a Europe that works, and works well, not a Europe based on the elusive sands of liberal or socialist dogma and ideology. Britain has taken a leading role in setting the European agenda, often saying things that other countries know are right. Quietly, they welcome what we say, but all too often they remain silent and allow us to do the hard work for them. That is as it may be.

We must look now to the 1996 intergovermental conference, to what we can contribute to that conference and to how we can continue our positive contribution to the development of Europe. My right hon. Friend the Prime Minister must focus on key issues, such as how to establish a fairer voting system, how to develop simpler and more transparent legislative procedures, how the Council can exercise more control over the Commission, how to reduce the unwieldy number of Commissioners, particularly as Europe enlarges, and how to pursue budgetary reform, CAP reform and, indeed, the policing of fraud. I now refer to the vexed matter of Cyprus. I restate Britain's special position as a guarantor of the independence of Cyprus. We are one of the guarantor nations. We also have a special position of one of the five permanent members of the United Nations Security Council.

Mr. Clerides, President of the Republic of Cyprus, held a round of five informal talks with Mr. Denktash, the leader of the Turkish Cypriot community in the northern third of the island of Cyprus. Those talks established beyond doubt two facts: first, that Mr. Denktas espouses and is driven by Turkish policy, not his own; and, secondly, that neither Mr. Denktash nor Turkey currently has the political will required to obtain a solution to the problem of Cyprus. I say "currently", because I hope that the situation will change.

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The facts today are plain: both Mr. Denktash and Turkey reject all the Security Council's resolutions, including paragraph 2 of resolution 939, calling for a solution based on a bi- communal, bi-zonal federation with a single indivisible sovereignty. They are adamant in their demand for recognition of separate sovereignties for each federated component unit, and for recognition of a separate sovereignty for the federal state as well. Those are unrealistic goals. They are without international precedents; they are simply delaying tactics --they cannot succeed. Moreover, Turkey and Mr. Denktash are against Cyprus becoming a member of the European Union. The United Nations Secretary- General's definition of political equality has also been rejected by Turkey and Mr. Denktash, as have the treaties of guarantee and alliance as they concern the guarantors and the unilateral right of intervention. They also reject demilitarisation. Responsibility for the failure to make progress, therefore, lies with Turkey and with the Turkish Cypriot leader, Mr. Denktash. The Security Council should now take specific and pragmatic measures against the side that flouts its resolutions and frustrates the proper and equitable solution of the problem of Cyprus. Progress can be made only if there is a change of attitude by Turkey on the key issues, in particular on sovereignty, demilitarisation, and the accession of Cyprus to the European Union. Therefore, I end by asking the Government now to consider promoting an international conference to move the issue forward. I ask Her Majesty's Government to do everything possible in the fast-coming talks to establish a timetable for Cyprus's accession to the European Union.

7.26 pm

Mr. William Ross (Londonderry, East): The hon. Member for Wolverhampton, South-West (Mr. Budgen) made an interesting speech, which was quite in keeping with the views that he and the former hon. Member for his constituency, Mr. Enoch Powell, have often expressed. Whenever I listen to the hon. Member for Wolverhampton, South-West, I think that there must be something in the air in his constituency, of which I fully approve in general terms.

The hon. Member for Wolverhampton, South-West and the hon. Member for Castle Point (Dr. Spink) referred briefly to the situation in the Irish Republic. Of course, that is the only country with which we have a land frontier, so perhaps the House will expect me to speak about the situation there. However, what is happening there is a private grief which those involved should sort out; it is not the business of Members of the House of Commons. We should sympathise and hope that they shortly find a way out of their problems. Perhaps some folk in the Irish Republic now think that the Act of Union was not a totally bad idea. One hopes that, one day, the foolishness of the teens and twenties of this century will be reversed.

The right hon. Member for Tweeddale, Ettrick and Lauderdale (Sir D. Steel) and other hon. Members said that we should try to pre-empt violence, and he referred in particular to places such as Rwanda. Although on the surface that seems a good idea, we need to decide whether armed intervention--that is what has been talked about--is needed, how it would be implemented and by whom, whether armed forces should wait until they are invited in, or whether they will have to fight their way in. When

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one considers the dangers involved in that, one realises that the matter is not as easy, simple or swift as some folk seem to think. Like many good ideas, it founders on the rock of reality. The hon. Member for Livingston (Mr. Cook) talked about three major trading blocs dominating the world over the next few years. He was corrected to some extent by the right hon. Member for Guildford (Mr. Howell), who drew attention to the various forces which are moving toward international trade, and therefore to far freer associations of trading nations rather than three large fixed blocs. If they ever came into being, they would be mutually antagonistic and would pose grave dangers to world peace. I support those who seek a steadily expanding volume of trade across the board. The general agreement on tariffs and trade is a large step in that direction.

I found the rest of the speech of the right hon. Member for Guildford somewhat depressing. He talked about the great eastern economies which would dominate the world for the next 20 to 30 years. He betrayed a pessimism about his nation which no hon. Member should exhibit. We should encourage our people and do what we can in this place to create a framework that will enable us to flourish and restore our position as far as humanly possible in the world. In the Gracious Speech, the Government restated, among other things, their objective of a balanced budget. I hope that that will shortly occur, and that we will then move beyond that happy position and once more be able to repay debt, not least that which is piling up from previous years and the current year, and that which will pile up in the next two or three years.

I also listened with care when the right hon. Member for Guildford explained how well the United Kingdom was doing. Regrettably, when I asked him the reasons, he did not seem able to give them. The answer was supplied by the hon. Member for Wolverhampton, South-West, when he referred to the happy events of 16 September 1992. That was the day on which the Government and the Treasury had to come to terms with the reality of fixed exchange rates.

Although there was much breast-beating, and sackcloth and ashes were much in evidence, we have seen the benefits of abandoning fixed exchange rates ever since. The Government were driven by the events of that day to go back to a floating pound. Indeed, the former Chancellor of the Exchequer had to re-create his policy on that day. From that day to this, there has been a steady move to the happier position which the right hon. Member for Guildford described. He seemed unable to bring himself to say that the desertion of fixed exchange rates and the evils that flow from them led to the present position. Unless and until the House, and especially the Treasury team, understands that, we are in danger of getting back into the difficulties that led to 16 September. Perhaps the Government are moving in that direction.

The economy is steadily improving in a very fine way, as the right hon. Member for Guildford said today, and the Prime Minister said yesterday. In the light of that, the blunt statement that the Government will continue to pursue their firm financial policies is welcome. If we really care about the future of our country, we should all support the Government in those firm policies. However, such firm policies imply a measure of pain from time to

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time. As we are a member of the European Union, firm financial policies must be applied somewhat more widely than in the United Kingdom alone.

We are told that, out of the total spend of the European Community, anything up to £6 billion disappears in fraudulent exercises. That is a fantastic sum of money. It is a maximum of some 10 per cent. of the total --no one really knows the exact figure. If no one knows what is being lost in fraud, it tells us an awful lot of nasty things about the systems of book-keeping that are being used.

We must improve either the systems of book-keeping or the system by which the cash is dispensed in the first place. Budgetary discipline and elimination of fraud are a vital component of our membership of the EU. Budgetary discipline has been evident only in the sense that it has been so evidently missing.

There was a debate on fraud in the other place on 31 October. Those who have not read it should cast their eye over it. They will find an appalling litany of fraud and corruption and sleazy deals. Some of those sleazy deals reached the point at which the British Government were blackmailed by other members of the Community. For example, the milk quotas of Italy and Spain were increased. Yet Britain is short of milk quota. Our farmers are crying out for more quota. Instead of receiving more, our quota seems to go steadily down. That is a matter to which the Government could profitably direct their attention. As one speaker in the debate in another place put it bluntly, there appears to be gross negligence in the way in which EC grants are handled. It is more than gross negligence. The system is so complex that it is almost impossible for anyone to understand it even if they want to. Many of the people who benefit from the fraud are not too anxious to find out what is going wrong. The system is complex, because so many different state systems are involved.

The Government spokesman in another place said:

"The responsibility for detecting and prosecuting fraud remains, nevertheless, with the member states."--[ Official Report, House of Lords , 31 October 1994; Vol.558, c. 746.]

That may well be so, but I draw it to the attention of the House--if that is necessary--that most of those states are net beneficiaries of EC funds. Who has heard of any Government being hard on their people for plundering a pork barrel that was constantly filled by someone else--in this case, Britain and one or two other nations? Such a system does not lend itself to easy reform. If the facts are as stated in the reports given to the nation in the debate in the other place, the idea that the EU can be corrected by good housekeeping is wide of the mark.

It is a matter of fact and of interest that the same Minister I quoted in another place praised United Kingdom Ministry of Agriculture officials for their work. It is also noteworthy that Britain has a fairly high detection rate. Of course, that may mean that there is a lot of fraud here, but it is more likely to mean that a much higher percentage of fraud was detected in the United Kingdom than in other countries because our systems are efficient. I believe that another reason is that Britain is a net contributor to the pork barrel, so our Government were rather more anxious than others to ensure that fraud was diminished as much as possible.

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It is also a fact of life that the same officials and their predecessors have always policed the United Kingdom agricultural schemes. I should have thought that that had a great deal to do with their success. The fraud detection system in Europe has been bad, and it is getting worse. It will deteriorate further as more nations join. Therefore, it is essential that all systems should be improved. Tinkering will not cure the problem. Everyone who has touched on that subject today and in the other place has said exactly the same. If we are to deal with it, we must create a system which devolves more responsibility to national Governments. Perhaps subsidiarity is the buzz word.

National Government would not be tied to economic, bureaucratic EC rules. A block grant system might be used. Spending would be better looked after, as Governments would be spending their own money. If the money did not go to those to whom the economic union had designated it, the internal democratic system in the various states would ensure that it did, so there would be far less fraud. A harvest is there to be reaped between now and the fulfilment of the Government's commitment to own resources. That change needs to be carried into effect to ensure that this and future Governments of whatever party--that depends on the will of the electorate--are not severely embarrassed over the size of our commitment in the next few years.

7.39 pm

Mr. Christopher Gill (Ludlow): It is a pleasure to follow such a respected Member of the House as the hon. Member for Londonderry, East (Mr. Ross), who was kind enough to refer in glowing terms to my home town. I was born and bred in Wolverhampton. The hon. Gentleman also referred to my hon. Friend the Member for Wolverhampton, South-West (Mr. Budgen) and to Enoch Powell. It might interest the hon. Gentleman to know that Wolverhampton's motto is, "Out of darkness cometh light." That might help to explain why he has heard such good sense from my hon. Friend the Member for Wolverhampton, South-West and his predecessor, the right hon. Enoch Powell, on so many occasions.

Dr. Goodson-Wickes: And from you.

Mr. Gill: How kind.

In June, I visited Stockholm and had the opportunity to talk to members of the Swedish Parliament. I asked one for his view of the prospect of Sweden entering the European Union. Without a moment's hesitation he told me, "The political classes are all in favour." That was an exceptionally arrogant remark, as it seemed to leave out of the reckoning the people who elected that man to Parliament. My hon. Friend the Member for Wolverhampton, South- West spoke well tonight. His was an incisive and challenging speech, which reminded us of an important question that all hon. Members should be asking themselves. He said that we were in great danger of turning the House into a rubber stamp to do the bidding of the Executive. I agree that it seems that no amount of reason, argument, debate or common sense will persuade the Government to allow those considerations to weigh most heavily.

My hon. Friend the Member for Wolverhampton, South-West instanced how the Single European Act and the Maastricht treaty were rammed through the House, in

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the first instance on a guillotine motion and on the second as a result of a vote of confidence. It is a very bad time for democracy when a measure that does not command the people's wholehearted support is put through the House in such a manner.

I remind hon. Members that, not merely in Sweden but in the other countries that held referendums on the subject, the margin in favour of joining the Union was very slender. Many of us regret the fact that although Ministers support referendums for African countries--now they even support one in part of the United Kingdom--they do not support a national referendum on the most important constitutional issue of my lifetime, and I am old enough to remember the war. It is unfortunate, to say the least, that politicians are prepared to treat the electorate with such apparent indifference.

I think that many of my colleagues privately realise, as I do, that that great endeavour can never be completely successful unless we take the people with us. I am reminded of what the former Member for Wolverhampton, South-West told me a few weeks ago: never forget that in the end the people will win. That is timely advice for my party and the Government. They may feel that so many of the things that they want to do to progress the European adventure can be pushed through the House on a guillotine or a vote of confidence and that there will be no reaction. There will be a reaction. Ultimately, the electorate will have the last laugh.

I hope that the leaders of the Conservative party have seriously calculated the effect on our electoral prospects of pushing the European Communities (Finance) Bill through the House on a vote of confidence, in the same way as they pushed through the Maastricht treaty and the Single European Act.

On the financial implications of the Bill, the Gracious Speech states:

"Legislation will be introduced to give force to the changes in the European Communities' system of own resources".

Barely five lines later, we read:

"Fiscal policy will continue to be set to bring the budget deficit back towards balance".

There appears to be a contradiction in terms. If the priority is to bring the budget into balance, surely one must consider carefully before committing oneself to additional expenditure.

My hon. Friend the Member for Wolverhampton, South-West said that perhaps hon. Members did not think that £75 million was a huge sum. It seems that when it involves something that the Government want to do, it is never a huge sum; when it involves something that our constituents or we Back Benchers want, it is always a huge sum. Surely we must ask ourselves whether we can afford that Bill. Estimates of how much it will cost vary and I shall quote only one figure. At present, the British taxpayer is paying the equivalent of 3.4p on income tax to Europe. By 1999, it will have risen to 5.4p in the pound. That may be fine for some of our constituents, but I represent Ludlow in the county of Shropshire, which ranks 11th lowest in the country for male wages and second lowest for female wages. When we talk of spending another £75 million on the European budget, I am mindful of the fact that that money will have to be found from our constituents. Everyone pays. There is no way for any of our constituents to avoid paying. Perhaps some of them avoid paying income tax because of their

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low earnings, but everyone will pay because no one can avoid indirect taxation. The fact remains that everyone in the land will have to contribute in one form or another to that extra sum of money for the European budget.

The benefits are advertised by those who are in favour of European political and monetary union. I hear people from our own country saying how wonderful it is that European money is going to pay for good things in their constituencies. I am always at pains to remind those people that those good things in their constituencies are not being paid for by anybody other than themselves.

In point of fact, were that money not sent to Brussels in the first place, there would be more money in the pot in the United Kingdom to pay for those good things. As that money progresses from Whitehall to Brussels--and as we then go cap in hand to bring it back again--it has become a smaller sum because of the administration and the bureaucracy.

Dr. Spink: Is not my hon. Friend making an over-simplistic argument? Is not our general prosperity dependent on our membership of the European Union? Are not there wider benefits to be derived from our membership?

Mr. Gill: That is an old canard. People who wish to oppose my point of view portray me as being against Europe. I am not against it; I am favour of the Common Market as are the majority of my constituents. When they voted in 1975, the majority of my constituents and, I submit, the majority of the constituents of my hon. Friend the Member for Castle Point (Dr. Spink) voted in favour of the Common Market. But they did not vote for --and they were told at the time that they would not get--political and monetary union. That is what I, and some colleagues, find difficult to forget.

Dr. Spink rose --

Mr. Gill: I know that my hon. Friend is tempting me to engage in further arguments, and I should like to give him that opportunity. Mr. Budgen rose --

Mr. Gill: I see that another of my hon. Friends wishes to intervene.

Mr. Budgen: Will my hon. Friend comment on the humiliating position of Hong Kong in relation to China and the surrounding countries? I am sure that he would agree that it is plain that Hong Kong is about to become bankrupt. It is not part of a political union with surrounding countries, it does not have monetary union and it does not have its laws made by surrounding countries. Is not it plain that disaster is about to descend on Hong Kong?

Mr. Gill: My hon. Friend tempts me to talk about the highly successful economies around the world which have no affiliation with any other country and which are not in federal structures. Those include stand- alone economies such as Japan and, as my hon. Friend mentioned, Hong Kong and many others.

I meet industrialists from this country who say, "Just give us the tools and we will do the job." They say that they do not need to be in a political or monetary union with other countries in Europe, and that they just want to get on with earning a living in the world, which they are capable of doing.

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Of course, it is an historical fact that we have earned more of our wealth in other parts of the world than in Europe. People who are opposed to my view say that we do 60 per cent. of our business in Europe. That may be true, but we are only doing that business with 6 per cent. of the world's population. I do not know of any business man who would think that that was a satisfactory customer profile. Any business man worth his salt would think, "If I am only doing 60 per cent. of my business with 6 per cent. of the world's population, have I spread my risk far enough or cast my net wide enough? Are there not other markets which I could attack?" He would be absolutely right to say that.

My hon. Friend's intervention reminds me that he--more than anybody in the House--knows what I previously did for a living. While I am talking about the financing of the European Community and questioning whether we can afford it, I shall tell the House about something of which I became aware only a few weeks ago. It is a project funded by the European Union to investigate ham automated monitoring systems, and to carry out this HAMS project, as it is called, the European Community will finance the university of the West of England to the tune of £500,000.

Four generations of my family have made ham in Wolverhampton. My father and I were quite content to produce hams to the best of our abilities by using skills which were handed down from generation to generation. If a ham was substandard, it would be returned by the customer and we accepted that we might offend or lose that customer. That is what I still believe in, and it is what my son is still practising. I do not think that it is any part of the European taxpayer's duty or responsibility to give £500,000 of taxpayers' money to the university of the West of England to do something that is purely and exclusively a function of the commercial sector.

Mr. Budgen: My hon. Friend and I are old men, and we are among the last of the people who did national service--my hon. Friend served in the Navy. To help many Conservative Members, will he explain how it is that we are preventing a third European war by giving subsidies to undercut him in the ham trade?

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