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speech the week before last that he had an unfailing commitment to enforce EU law. In any case, it is open not just to the Commission, but to any private individual to challenge the legality of our internal frontier controls through the British courts, which will then be advised to refer the case to the European Court of Justice under article 177.

As I said, the Flynn case has already reached the High Court this week. When, sooner or later, there is a European Court ruling against us, it will not be something that we can simply ignore, because non-EU passengers arriving at our internal frontier ports would be able to apply for judicial review if they faced an immigration check that the European Court had declared unlawful. A flow of similar cases would follow quickly, paralysing the judicial system and rendering our frontier controls useless. The administrative confusion and the cost to the taxpayer of many of those who then entered unchecked would cause massive public disenchantment. Uncontrolled immigration is not what British people, regardless of their ethnic origin, want. They have never been asked whether they want to leave Britain's back door open; if they were, their answer would be an emphatic no.

By and large we are a civil nation, welcoming millions of visitors here from around the world each year. That is quite different from letting in the world and his wife to settle here indefinitely. An influx of migrants, freely walking into this country without so much as a by your leave, would quickly heighten racial tension. The first to suffer from those tensions would be British ethnic minorities, born and bred here and peacefully and constructively contributing to British life.

For those reasons, I urge my right hon. Friend the Prime Minister to put article 7a openly on the IGC agenda and to insist to our EU partners that the purpose intended by Margaret Thatcher for the 1985 declaration, but not achieved, must now be embodied in a substantive change to the treaty itself.

That is a pro-European argument. It is a Conservative solution, which has already left the Opposition hopelessly divided, as every recent debate on immigration has shown. It is an issue on which my right hon. Friend the Prime Minister can lead the way and which, I can assure the House, will continue to command a great deal of public support.

8.7 pm

Mr. Ieuan Wyn Jones (Ynys Mo n): We have had a lot of interesting contributions to the debate, which has at least given us the opportunity to consider some of the wider aspects of the European debate, in particular, the steps that we need to consider in the run-up to the intergovernmental conference in 1996 and the discussions leading to a single currency either in 1997 or 1999. As well as looking at the single currency, I should like to consider the institutional changes that the Community must face as we consider the possible applications for membership from a number of central and eastern European countries. I should also like to consider the ways in which the Union needs to become more democratic and accountable. We must consider the means of carrying the population of Europe behind the momentous changes that we inevitably face.

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Some argue--some have done so today--that the Union that we joined in 1972 is vastly different in 1995. In other words, the Community, as it was, is now a vastly different animal. We have to recognise that the principles enshrined in the treaty of Rome in 1957 have their inevitable consequences in what was decided at Maastricht. Although the decisions taken at Maastricht were clearly a compromise, and even a fudge, we must recognise that the seeds of Maastricht were sown in 1957.

I remind the House that the treaty stated that the original signatories were

"determined to lay the foundations of an ever closer union amongst the peoples of Europe."

That has to be the basis on which subsequent developments have to be judged. The imperative for action was clear. The continent of Europe had been devastated by two world wars in a generation but, while the instruments of co-operation in the early days were economic, the impetus was clearly political. In the immediate aftermath of the second world war, France and Germany decided that it was in their best interests to move towards economic integration.

The need for such action was recognised by Winston Churchill in his famous Zurich speech in 1946. He posed the most pregnant question of all: how should Europe respond to the devastation inflicted by war? He answered it thus:

"It is to re-create the European family, or as much of it as we can, and provide it with a structure under which it can dwell in peace, in safety and in freedom. We must build a kind of United States of Europe."

We may agree or disagree with the prescription, but it is clear that in that speech Winston Churchill recognised the importance of political and economic integration.

Britain's refusal to join the original six was based on a profound misunderstanding of its position in the post-war world. The British economy, as we have heard from hon. Members of all parties tonight, could not hope to compete outside the Union, and its political influence was severely diminished. However, when that realisation dawned, it was too late to shape the kind of Community that many people in Britain wanted. The original six had pressed ahead, and the terms of the treaty of Rome, and subsequent developments, were fixed in 1957.

The debate in Britain on the single currency has echoes of the past. There is no doubt in my mind that every decision taken since 1957 has led to the setting up of a single currency as envisaged at Maastricht. It should not have come as a surprise to anyone. In fact, there is very little debate on the issue in other member states. They do not have an opt-out or the kind of sterile debate that we have in the United Kingdom.

I cannot understand the argument about the loss of sovereignty because that argument should have been faced in the debates leading to the Single European Act. It did have consequences for the sovereignty of member states because its purpose was to set up an internal market by bringing down trade barriers, removing customs controls and moving to harmonisation of indirect taxation. The move to harmonise indirect taxation impinges directly on sovereignty. The Government agreed to the formula set out at Maastricht to achieve a single currency. It is now a treaty obligation. The convergence criteria apply here. We constantly have to ask ourselves what will happen with price stability, reducing Government deficits and

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borrowing and so on. What happens in 1997 or 1999 when the criteria have been achieved, if they are achieved? How can we agree to the convergence criteria and set our targets accordingly but, once the targets have been achieved, say that we wish to remain outside the single currency? It is inconceivable that, having got that far, any Government would want to say no.

Alongside the debate on economic and monetary union, we must consider the Union's lack of accountability and transparency in its decision-making process. It must also become demonstrably democratic. For example, the Council of Ministers should open its doors and allow its proceedings to be publicly scrutinised and, as has been said, the European Parliament should be given greater powers of co-decision and new powers to amend the Commission's proposals.

In the short term, my party would like the Committee of the Regions to develop in such a way that it can take responsibility for regional policy, including structural funds and Community initiatives and, in the medium term, become the second chamber in a European bicameral parliamentary system.

I also want a change in the way that portfolios are allocated when Commissioners are appointed. The initial choice should be in the hands of the President of the Commission, subject to the approval of Parliament. This year's proceedings were a total farce because the horse trading between member states meant that it had already been decided which Commissioners should have which portfolios. The Commissioners appeared before Parliament but it was merely a facade to suggest that Parliament was involved in some form of scrutiny. I should like the President to be able to decide on the portfolios, subject to real scrutiny, and the European Parliament should be given the opportunity to reject particular portfolios being allocated to particular Commissioners in certain circumstances. That would make the Commission more accountable to the European Parliament. I can see no problems with that. One cannot say that the European Commission is unaccountable and unelected but then deny it the legitimacy that it should have through its responsibility to the European Parliament. They are some of the institutional changes that should be taken on board at the 1996 intergovernmental conference. Plaid Cymru recognises that the Union has to take further steps to achieve political as well as economic union through institutional change and the development of a common approach to defence and foreign policy. In that development, it is right that institutional and constitutional change is not limited to the European stage. There should be accountability at all levels. That is why there has been a growth in autonomy and self-government throughout western Europe--in Germany, Spain and Belgium and the small member states of the European Union. The best way to make progress is to ensure that, while it is necessary for some decisions to be taken at the European level, others can be taken at a local, national or regional level. In recent years, Wales has forged new and exciting links with the motor regions in Europe, but those other regions possess a degree of autonomy and self-government that is denied to Wales. If one takes the small--

Mr. Deputy Speaker: Order.

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8.18 pm

Mr. William Cash (Stafford): I heard the Prime Minister's speech with some misgivings and sadness. I believed that we had a tremendous opportunity today to hear a speech that could have defined a new way forward for a new Europe, instead of which we heard, in effect, an endorsement of the position under the Maastricht treaty. Unless and until we renegotiate that treaty, I fear that we are locked into a legal framework from which there is no escape.

The Prime Minister spoke today about a number of matters, including the question of a single currency, without giving us any hope that we would find a way out of the trap that Maastricht has presented. I believe that we have now reached a point where it is becoming ever more evident that the people not only of this country but elsewhere in Europe have increasingly moved against the single currency. Opinion polls in Der Spiegel in Germany recently indicated that people there do not want a single currency. In a Harris poll of 250 top executives in the City of London, 63 per cent. wanted a referendum. On Central Television on Sunday, I debated against one of my positive European colleagues and we had a phone-in after the debate on a single currency. The motion that I put forward to reject the single currency was carried by 71 per cent. of the people who phoned in, compared with 29 per cent. who favoured a single currency.

What concerns me is that we are not making the kind of progress, which seemed to be implicit in the language of the Prime Minister and for which I had been looking over the past few years. Certainly there has been a trend in the right direction. Unfortunately, the promise has not been matched by the performance. For example, in The Economist on 25 September 1993, my right hon. Friend said: "I hope my fellow heads of government will resist the temptation to recite the mantra of full economic and monetary union as if nothing had changed. If they do recite it, it will have all the quaintness of a rain dance and about the same potency."

I would have very much liked to have heard such language again in this debate.

In the speech that my right hon. Friend the Prime Minister gave in Leiden on 7 September, almost exactly a year later in 1994, he said:

"I see a real danger, in talk of a hard core, inner and outer circles, a two-tier Europe. I recoil from ideas for a Union in which some would be more equal than others. There is not, and should never be, an exclusive hard core either of countries or of policies." The problem is that the Maastricht treaty has created that very situation. By failing to veto economic and monetary union and by allowing it to take effect irrevocably on I January 1999, as I indicated in my intervention during the Prime Minister's speech, the circumstances are being created; the trap has been fallen into. The result is that our Government are truly on the line. By that, I mean that it will be impossible for us to escape from the question that I put to the Prime Minister in the confidence motion over the Maastricht treaty. I asked him if he had not presented the British people with the unnecessary question of whether we would have to leave the European Community after 1996. There is a deadline.

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Today I was looking for a commitment that we would not have a single currency at all in principle. When the Prime Minister said that we would not yield to any unbending centralisation, I made the point, with which people surely cannot argue, that a central bank goes with a single currency, so if we make a commitment to refute unbending centralisation, we must be absolutely clear that we will reject the single currency. It is a practical question as well as a matter of principle. It seems, therefore, that there is no contest on the argument. The question primarily is one of timing. I have to say to my right hon. Friend the Prime Minister that the logic of his position is that we would say, "Not yet; we will make the decision later." He is pretty well saying that we must be practical about it and we must view the circumstances at the time.

Let me turn the minds of hon. Members back to the circumstances of the exchange rate mechanism and apply a practical application of the same principle. When we went into the exchange rate mechanism, we were not bound into a legal framework from which there was no retreat. As we know, although we were ignominiously ejected from the ERM because the Government refused to listen to those of us who were saying that it was a disaster--we had to get out and the sooner the better--at least we had the option of being able to get out on our own terms, however expensive that may have been for the British economy and however disastrous the policy.

If one applies the same principle to economic and monetary union under the Maastricht treaty, who is to say what will happen by 2001 or 2002, bearing in mind, for example, what the Governor of the Bank of England has said about the dangers of monetary union--the practical application of the principles that I am advocating--to jobs? As we know from a recent survey, Europe is suffering the worst unemployment for 30 years--despite the Cecchim report; despite all the promises that were made. Therefore, if we get ourselves into a position by not rejecting a single currency now and kick the ball into the long grass, which is basically what the Prime Minister is suggesting, we shall end up being told in the treaty negotiations that everything was decided in the Maastricht treaty.

When my right hon. Friend the Prime Minister refers to the fact that there will be no constitutional implications with respect to the Maastricht arrangements, which I would not resist if they were to have a significant constitutional impact on the United Kingdom, which is what he said virtually the other day in the "Breakfast with Frost" programme, he is effectively saying that we have adopted a position already, through the Maastricht treaty, which is a matter of principle, but that if we go further down that route, it would be construed as a constitutional issue with very severe practical implications. In fact, it is already a constitutional issue. That is a problem. It is the lack of logic in my right hon. Friend's argument that I find so difficult.

If we get to the point, as we did with the exchange rate mechanism, that we do not want any more truck with economic and monetary union, yet we find that we have locked ourselves into it, there is no way out. As a matter of principle, we should be getting out of it now. If we had the leadership and the determination to look to the landscape of the next few years and consider the fact that the French presidency may last for seven years--that will be decided in April or May this year--there would be a real possibility that we could change, by that

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leadership, the nature of the debate in France. If we said that we were not going to have a single currency and said it soon enough--now--the people in France, let alone the leaders who are squabbling with one another, would realise that they faced being pretty well left in a Europe on their own with Germany, just as in the Maastricht referendum, which got through by only a whisker and would not now if it were put back to the French electorate. We would, therefore, present circumstances in which we would change the nature of the debate in France and, at the same time, ensure that we could renegotiate the Maastricht treaty on those practical considerations to which I have referred.

There are profoundly good economic reasons as well as political reasons for rejecting a single currency, but above all else, it is a question of principle. It is a question of the democracy of the United Kingdom and the question is, who governs Britain--

Mr. Deputy Speaker: Order.

8.28 pm

Mr. Calum Macdonald (Western Isles): We listened with great interest to the speech by the hon. Member for Bexhill and Battle (Mr. Wardle). It is a notable illustration of the tensions and divisions which afflict the Conservative party over Europe that there is a long list of ministerial victims, who have been either pushed out or have fallen on their swords because of Europe. Indeed, it is a long and prestigious list of names: Lawson, Howe, Ridley, even Thatcher, to which I suppose that we must add the name of Wardle. As consolation for the hon. Member for Bexhill and Battle, he can at least be sure that he will not be the last--others will go the same way. The reason for the fundamental division within the Conservative party on the issue of Europe is that the Conservatives simply do not understand Europe. They certainly do not like it; they have no affection for it, but they do not understand it, either. They do not understand Europe because they do not really understand Britain. They do not understand what Britain is all about.

We have heard much this evening about Britain being a nation state. Of course that is true; Britain is a nation state in one sense--it is obviously a state--and we all feel a national attachment towards the notion of Britain. We all feel British in an important part of ourselves. But, at the same time, Britain is a multinational state. It is a union of four nations: Scotland, Wales, England and Northern Ireland. We can have a multinational state, a multinational identity, and a strong British identity as well. We can be both Scottish and British. Truly to appreciate that should put to rest the exaggerated worries of some Euro-sceptics about the dangers to national identity of further integration within Europe.

I do not argue or recommend that the pooling of sovereignty within the European Union should lead to a multinational union such as the United Kingdom. The way in which the European Union will evolve will be completely unique--it will evolve in its own original way. It will not be like the United Kingdom, the United States of America or the federal constitution of Germany. Indeed, I would not want it to be like the United Kingdom, because, in the 20th century, in particular, the United Kingdom is a model of a multinational union which is much too centralised economically and politically.

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The United Kingdom shows the absurdity of the fear that European integration will lead to a loss of national identity. British integration has not lead to a loss of Scottish identity. With European integration, we are not losing identity; we are gaining a new identity. In addition to our Scottish, English, Welsh and British identities, we will develop a European identity. Indeed, that is already happening throughout Europe and within the United Kingdom. That factor has been missing from the debate. In particular, it has been missing from Conservative Members' speeches. People are beginning to feel European. They feel wholly British, of course, but they are beginning to feel European as well. It has become more natural for young people in particular to think of themselves as Europeans.

If Conservative Members really understood and empathised with the new European identity, they could concentrate on the real agenda--the real issues--instead of the bogeymen that they constantly raise. I refer, for example, to the need for radical reform of the common agricultural policy. The Government claim to be in favour of reform, but their claim is completely false and spurious. The Government were one of the main parties to block the fundamental changes which Ray MacSharry wished when he was Agriculture Commissioner. The reason for that is that, although the United Kingdom is a net loser through the CAP, a small but politically powerful group of farmers gain greatly out of the CAP.

Twenty per cent. of farmers receive 80 per cent. of all CAP funds. The bulk of funds goes to a small minority of farmers. That is a fundamental iniquity that the Conservative Government would never even think of challenging, and that is why we need a Labour Government to push through fundamental reform of the CAP. The same could be said of the common fisheries policy. Again, there is need for a fundamental reform to make its operation more regional and more sensitive to the new enforcement mechanisms. Again, the Conservatives simply do not have the will to pursue such radical reform, because they simply do not care about fishing communities. The Government are now claiming some credit for trying to move along greater co-operation within Europe on defence. But the Government, year after year, resisted the notion of building a strong European pillar on defence. They constantly told us that that would accelerate the withdrawal of the United States from involvement in the affairs of Europe. Now they are beginning to turn. I welcome that, but I cannot believe that their hearts are really in that development, either. That is a fundamentally important development to pursue. Without a common defence policy as set out in Maastricht and without giving substance to it, there can be no credibility or substance to a common foreign and security policy.

I will not say much about the social chapter, because my colleagues have covered that matter comprehensively, but how can the Government talk about increasing the conditions for genuine convergence among the different European economies when they opt out of the social chapter? Surely social convergence has to exist along with economic convergence.

On the issue of the single currency, the reality is that it will come. It is not a question of whether it is a good thing for Europe or whether Europe should go ahead. Europe will go ahead. There will be core countries,

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probably by 1999--France, Germany, Benelux, and probably Austria. The question for Britain is: when that European core goes ahead, should we be part of it or stay outside? We have only to ask that question to receive the answer. It is inconceivable that the United Kingdom should stay outside. We really would then be in the second division.

I give a final warning that, if Europe goes ahead and Britain tries to stay outside, we could not retain the status quo in Britain. If that happened it would set up tensions within the United Kingdom itself, particularly in Scotland, which could lead to the break-up of the United Kingdom. The status quo is not a serious alternative. We have to be part of the process of European integration.

8.36 pm

Mr. Christopher Gill (Ludlow): The whole House will have listened with great interest and attention to what the Prime Minister said this afternoon, but I refer to a speech that he made at the beginning of February to the Conservative Way Forward group, when he said: "Europe's future matters to us . . . we should debate it. And we have an obligation to shape it and make it more congenial to us." He then went on to say:

"Popular opinion across Europe cannot be ignored."

I agree with that, and I am sure that the whole House would agree with it, but the fact of the matter is that, especially in this country, every stage of the process towards European integration has been rammed through Parliament, to the virtual exclusion of what people outside this place are thinking. The treaty of accession was rammed through the House against the better judgment of several prominent and principled Conservative Members of Parliament. The Single European Act was rammed through Parliament after a guillotined debate. The Maastricht treaty itself involved a vote of confidence. More recently, of course, the European finance Bill involved a motion of confidence to which seven of my colleagues and I declined to respond.

Since then, I and my eight colleagues have been on the receiving end of thousands of letters, the majority of which have said three things: first, "We agree with you on the issue"; secondly, "Thank goodness someone is at last standing up for what we believe in"; and, thirdly, "Don't give in!" Very sadly, many of them sign off as "Disillusioned Tory", "Ex-party Worker", or "Former Tory Voter". Those are signals which our Government simply cannot afford to ignore. With a general election two years away, those are messages which they must heed or face the consequences. It is no longer a question of appeasing foreign Governments, placating querulous Cabinet Ministers, or wooing the Whipless Back Benchers. The Government must listen to the people. Sooner or later, the political classes will have to obtain a mandate for their European policies from the very people who put us here. Sooner or later they will have to recognise that there are only two ways of doing that--either through a referendum or by offering a real choice at the next general election. To my colleagues I say simply that if by the next general election the Conservative party does not offer that real choice, make no bones about it, others most certainly will.

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I make no secret of my own preference. It would be for the Tory party to be seen as the party offering a clear and unambiguous alternative to the sell-out promised by the socialist Opposition parties. I should like to hear my right hon. Friend the Prime Minister, who has been kind enough to write the foreword to a pamphlet entitled "A Europe of Nations", say that he stands four-square behind the 49 conclusions that my 11 colleagues and I published in that pamphlet.

Those conclusions are supported by 28 centre-right parties in 20 other European countries. They are not the findings of an isolated minority but the considered opinions of respected mainstream politicians in this country and on the continent--indeed, across the whole of Europe.

The conclusions are in no way demands. They represent a series of serious and thoughtful suggestions that in our opinion would strengthen the Government's hand at the forthcoming intergovernmental conference and significantly improve the Tory party's prospects at the next general election. Whether the Government adopt those suggestions is of course a matter for the Prime Minister and the Cabinet to decide. But that is a judgment that they must now make--and by their judgment they will themselves be judged.

I shall make one final point. There is at the moment a depth of disillusion with politicians, and a contempt for the arrogance and deceit of the political classes that will not be dispelled by empty rhetoric. To use a modern idiom, the voters want to see the beef. It has been a long time coming, but the moment has finally arrived when we must start unbundling the European Union so that different groups of members can co-operate flexibly in different areas of policy, all within the constant nexus of the single market. Areas of policy that are of purely domestic concern should be ring-fenced or reserved exclusively for national Governments. That arrangement should be enshrined in national constitutions, which in the United Kingdom would entail an Act of Parliament guaranteeing national sovereignty in specified internal areas.

The institutions of the European Union must be overhauled to reverse the current one-way drift to federalism. The Commission should be reduced to the role of a civil service, and the European Court must stop making law on the hoof. The European Parliament should be prevented from competing with national Parliaments for power. Last but not least, all articles that provide for monetary union should be removed from the treaties so that a single currency could come about only by evolution and with the full consent of all participating countries.

I believe that the whole nation would rejoice to hear the Government endorse a message of national sovereignty, of national self-confidence and the reassertion of the Conservative party as the only truly national party in British politics.

8.43 pm

Mr. Denis MacShane (Rotherham): We have heard three speeches tonight --one for Europe from the right hon. Member for Old Bexley and Sidcup (Sir E. Heath), one for the nation from the Leader of the Opposition, and one for and to his party from the Prime Minister. If I put myself in the position of any other member of the

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European Union, or of its newspapers or of its politicians, and went through the Prime Minister's speech looking for some guidance or direction, I should find none.

On a Euro-currency the Prime Minister said, "Yes, maybe, not sure, wait and see." On a referendum he said, "Possibly, could be." He said something strong about defence, but I am not sure whether our friends and partners in NATO would be quite as keen as the Prime Minister seems to be to regard Britain as the Gurkhas or the Spartans of Europe in exchange for being left alone to pursue our own course in so many other areas.

A key part of the debate has been about a single European currency, although more properly under the treaty we should be talking about economic and monetary union. We have not heard much this evening about the aspects of economic union that go far beyond the simple, single market, free trade area that is the lowest common denominator uniting members of the Conservative party.

The debate has been extremely interesting, and listening to it has made me realise that the Conservative party, or some of its members, oppose economic and monetary union because it requires a pooling of sovereignty. They believe in the mythical concept of a currency of which this country must under no circumstances lose control. If the British currency were so powerful and of such great value, and if in the past 15 years it had maintained a common value against any other currency for more than 18 or 20 months, there might be some sense in that argument. But the plain fact is that since 1979 our pound has been the sick man on the roller coaster of other world currencies. Some Labour Members demand the right to devalue, saying that the weapon of devaluation should always be in the armoury of a national Government. I tell them, and some Conservative Members, too, that devaluation was, is and always will be the soft option. The hard option-- the socialist option, or at least the social democratic option--is to remake our labour market and our economy on the basis of partnership, of industry and of fairly distributed growth to ensure, as in Germany and in the dynamic Asian economies, that we become a world beater rather than a country whose companies are taken over one by one and whose banks collapse when some wide boy from Watford goes on a spree in Singapore.

In a nutshell, I am a hard currency and cheap money man; I favour a hard currency outside and low interest rates inside. I am glad to say that, after many deviations, that is a policy for which I hope the Labour party now stands.

However, we must go beyond the currency question, because the historic duty of 300 years of British statespersonship has been to ensure that there does not develop on the continent a military, an ideological or a religious bloc so powerful and predominant that it reduces our capacity for independent and sovereign manoeuvre. I tell both my colleagues and Conservative Members that with the formation of a Franco-German deutschmark bloc--surely that will come--there will exist exactly such an economic hegemonic unit that will control so much of the European economy that from the people who will then be running Europe the message will come to Britain, as an offshore island with an offshore currency, that the line has been determined and that Britain can play no part in determining what that line should be.

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A point that has not be raised much today concerns the present fundamental democratic deficit in Europe. Yes, the people of this country and of the other European nations are unsure of the direction in which they are being taken. The answer to that problem is not to opt out again and again but to make the procedures of Europe more transparent and to make the Commission, whether it is a civil service or consists of former Ministers, far more accountable and to put it under democratic control.

That will mean accepting that we must tackle the problem of the free movement of people, which is a fundamental part of the more integrated European model that we are trying to create. The free movement of people, which has been wickedly confused with the question of immigration from outside the European Union, is very precious to Europe. We cannot have the free movement of goods and capital without the free movement of peoples, and anybody who pretends otherwise and puts up border patrols and road blocks at every port, road and tunnel into the UK will find that if that is how we treat our partners' people, they may start treating our goods in a similar way.

Mr. Michael Shersby (Uxbridge): The hon. Gentleman is talking about the citizens of the European Union moving about freely within the Union, and that is one thing. There are 5.5 million people inside the European Union from other countries. Is he suggesting that they should be able to move about freely within the Union and come to the UK without restriction?

Mr. MacShane: If Europe recreates the controls over all roads and methods of transport which it had immediately after the war, it will be a disaster. If Britain alone recreates or overemphasises those controls, the rest of Europe will not necessarily be happy when dealing with other areas such as the movement of goods, services and capital.

The point has been put that the IGC is simply a minor tidying-up affair and the Prime Minister said that, in due course, the Government will put the proposals to the House. He may be indulging in some wishful thinking, because the IGC will have to look at the substantial question of how European nations--those now in the EU and those seeking to join--relate to each other. Every enlargement of the European Union has led not to a loosening of relations, but to a tightening of them. If we want the free movement of goods, capital and people, we need regulations.

There is an idea that 27 countries could exercise a veto over all the issues. We know which issues are important to us, but other issues are important to other countries. What if Poland, for example, said that it would veto any changes or reforms to the common agricultural policy? Placing the veto on a pedestal outside the specific area of military or defence co-operation is extremely dangerous. That will not bring the Europe which the majority of Members want. It would create a conglomeration of principalities, like Germany in the 17th century.

The only way forward is through dialogue and partnership with our partner countries, between all sectors of our society and--above all--with the workers and employees who have so far been excluded by the Government from the European debate. That dialogue and partnership is not available from the Conservative party, and only a change in Government can deliver it.

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8.52 pm

Mr. David Martin (Portsmouth, South): I cannot remember when I last spoke on European matters in the House. In recent years, I have been closer than some to the trials of the Government, who have often wrestled with a party and a Parliament rightly sensitive to the increasing impact of the European Union on British interests in crucial spheres of our domestic policies. Animal exports and immigration and border controls are merely two examples currently in the news.

The European Union also has elements which are ambitious to gather to themselves defence and foreign policy matters. Among those who describe themselves as positive about the European Union, there is bewilderment that people do not share their enthusiasm about the benefits of our membership. They blame the Government for not being positive enough, when heaven knows, the case has been put by my right hon. Friend the Foreign Secretary and by many other Ministers for many years.

What obscures the advantages of our membership is that there is a pervading sense of being carried along at a forced pace towards European political union without any hope--which in the event proves to be real--of having significant allies in the European Union on crucial occasions to arrest the process.

My right hon. Friend the Prime Minister said in his speech that there are many in Europe--there are some in the House--who do not want to arrest that process at all. They speak of the destiny of a united Europe, in the sense of one people, one state. They are disdainful and dismissive of concerns about sovereignty, nationhood and the major constitutional changes that are required. It is like a faith to them. There have been such visionaries before. Theirs is an old concept in modern form.

Whether we like it or not, the question of a single currency in the context of the Maastricht treaty is plainly set to dominate the European agenda in a way which will dwarf the "will we-won't we" debates which preceded our entry into the ERM. The Prime Minister was right in accepting that a single currency is more than an economic or business matter, but that it has serious constitutional and political consequences. It would be, of course, an enormous step towards political union, just as the single market has taken us inevitably further down the centralist road.

The opt-out has been negotiated, but that begs the question--which will not go away, as 1999 grows nearer--whether the Government will exercise that opt-out or recommend that we participate fully in the single currency in 1999, less than four years away.

Why should the Cabinet have to pretend to be united on this great subject? We know that some Cabinet members have no objection in principle to signing up, and we know that some do object in principle. Throughout the ages, all Cabinets have found difficulty on such matters. All Cabinets and Governments are composed of the principled, the more flexible; the bright, the pedestrian; the cautious, the impetuous; and are as subject to folly and wisdom, sound judgment and profound misjudgment as any body of people thrown together by caprice, merit, fortune, sycophancy or necessity.

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There is no way that any Government-- whatever the Leader of the Opposition may naively believe--in this Parliament or the next can be united on the question of a single currency, when the question whether to opt in or out will have to be decided before 1999. I wish that my right hon. Friend the Prime Minister would announce now that he is still of the view that he expressed to the Treasury and Civil Service Select Committee when Chancellor of the Exchequer in July 1990--that a single currency would involve a

"transfer of sovereignty from the UK Parliament of a sort neither Government nor Parliament would find themselves able to accept". I recognise that we as a party are as split as Labour is--and most certainly would be in government--on such a question.

Although I heard what my right hon. Friend the Member for Old Bexley and Sidcup (Sir E. Heath) and others have said, I would say that--as with Balfour, who was faced with the equally explosive tariff reform question before the 1910 general election--the best way forward for my right hon. Friend the Prime Minister lies in promising a referendum. I am convinced that my right hon. Friend believes that, but has not yet found the moment to say so.

The mechanism that I would prefer would begin with a vote in Parliament. Then, if Parliament voted to join a single currency--only if it so voted--a referendum would ensue.

Finally, despite the Government's self-inflicted minority voting position in the House, I hope that they will achieve a majority tonight with the help of the Whipless. [Hon. Members:-- "The witless?"] I said the Whipless.

If I were the "Chief Whipless"--that position is unenviable, and is a sort of parliamentary Moloch--I would recommend that course upon my colleagues. That is not only because I want to see the Whip restored to all of them without preconditions as soon as possible--a quiet letter from the Chief Whip would suffice--but because my right hon. Friend the Prime Minister has moved as far as reasonably can be expected at present. The rebels, or the Whipless, have had a real and lasting effect on that. In addition, the experience has proved salutary for the Government. Since removal of the Whip from so many, they have found control of the agenda even more difficult than usual.

All Conservative Members who see disunity as the main threat to our fortunes and as doing the work of opposition--work that official Opposition Members are incapable of doing, as we witnessed in all its glory today with either their people or their policies--must hope that harmony will be restored in the Government's victory tonight. 9 pm

Mr. Thomas Graham (Renfrew, West and Inverclyde): Earlier today we heard the Prime Minister, who was going to make a statement to the nation and make it clear to the rebels why they should back the Government tonight. Our motion is that

"this House does not support Her Majesty's Government's policy towards the European Union and does not believe it promotes the interests of the British people."

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The past 15 years have shown that the Conservative Government are totally incapable of managing the country. They have sent the wrong signals to the rest of the world and especially to the people in Europe. They have an absolute xenophobia--something that the Opposition and the rest of the nation must reject. I have always believed that British people are not anti-foreigners. We welcome all cultural divisions.

When I hear the Conservative rebels and look at the divisions on that side of the House I find it unbelievable. Who would believe that the Prime Minister is coming here tonight to plead with his nine rebels? He called one of them "barmy" in November 1993. Not long after that, in early 1995, he said that they were very "conservative", and I quite agree. Then one of those barmy rebels said:

"I would be extremely surprised about the manhood of any of them who didn't refuse to retake the Whip. I think most of my male colleagues are men who can be trusted and we are staunch patriotic Conservatives. We are one group of people that have been foolishly treated by the very immature people who are running the country." The rebels were talking about their own Government. They have put in place this Government and the Cabinet to run the country and they are calling them an immature Government. I fully agree with the statement by the hon. Member for Billericay (Mrs. Gorman)--this is an immature Government.

We have seen a divided nation--the rich get richer, while the poor get poorer--a divided Government and one unbelievably divided party. The Government cannot see any direction in which to go. They have no hope for Britain and are trying to make some arrangements, but we must remember that we joined the market. In those days, I was an anti-marketeer. [Hon. Members:-- "Ah!"] Hon. Members may say, "Ah!" but when I was a young kid and used to be wild and run across the road, my mother told me, "Listen son, if you keep doing that you'll get knocked down." I have changed my mind and I do not run across the road now. So, some of us do make decisions and I am telling the Government that it is time for them to change their minds. There is nothing wrong with changing your mind. Many of us do in immaturity things that we do not do with experience.

The Conservative Government have had 15 years, but they are so inexperienced and immature that they are running Britain down in the eyes of Europe and our competitors because they are no longer making Britain great. They are making us fools in the eyes of the world. I believe that we should go for a single currency and I believe in monetary union. That is the way forward for the people whom I represent and look after. I am sure that if we went among the business folk in my constituency and asked the ordinary men and women, they would agree. We are in Europe. We have paid for membership of the club. Let us get the best deal possible. Let us sit at the management table and not go with the cop-out and the opt-out that the Government back.

Today, the Prime Minister faced in every direction and he sat on the fence. You know what happens if you sit on a fence too long--you get the sorest backside ever. The way that they are carrying on, this Government are going to get one big kick up the backside at the next general election.

We have also heard about the fast track, the slow track and every track. I will tell the Minister this--if you walk in the middle of the road, you end up getting knocked down. The Government have to make decisions for our

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people. One decision that they could have reached, which would have got the backing of the nation, was to support the social chapter. I see Conservative Members smiling, but in my constituency the unemployed people are not smiling.

I remember when the referendum took place and the Tories were marching up and down the country telling the workers to vote to join the Common Market. I remember the promises that they made--everything was going to be rosy, there would be new jobs, pensions and holidays and our health scene would improve because we would have a big market. I remember the days when the right hon. Member for Old Bexley and Sidcup (Sir E. Heath) and the others were travelling the world and telling us how good it would be. When they got an opportunity to sign the social chapter, however, they knocked it back and let working-class men and women in this country down because they were not prepared to put their money where their mouth is and back the ordinary men and women who make this country and who produce. Those men and women want to be in the market, and they want to get a benefit from it.

Clearly, the Government's role is to iron out the difficulties and to manage the country's affairs with those other countries. Let them come to good sense and arrange them. When we join a club we all participate and take part in its functions, but if the club has something the matter with it, yes, we argue and debate and try to get a consensus arrangement. This Government have abandoned that. They do not want to sit at the table, they want to sh--I was going to use another phrase--[ Laughter. ] Let me put it this way, they want to spill a drink on the table. They do not want to contribute in the way that we expect a Government to do.

I am delighted that the Prime Minister has considered a referendum. I have always supported referendums and have never seen them to be a weakening of anyone's position. Occasionally, we have to go to the country and give the people the right to vote and to make decisions. It is appalling that in this House we think that ordinary men and women cannot make up their minds, that they are all thick and dummies. We are the biggest dummies and this Government is one of the worst in the past 15 years. Why do they not listen to the wishes of the people, have a general election now and let in a Labour Government, who will meaningfully discuss and debate and take Britain on to better things with our European partners?

9.7 pm

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