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8.13 pm
Mr. Calum Macdonald (Western Isles): I welcomed the opening speeches of the Chancellor and shadow Chancellor. Both clearly stated their personal support for the principles of a single currency, and argued strongly for its advantages--provided, of course, that the convergence conditions were met. Both made excellent speeches, which I believe have moved our debate forward considerably.
One of the accusations levelled against the Chancellor by those sitting behind him during his speech was that much of the motivation for the drive towards a single currency was political. I do not think that we should be embarrassed about saying that the single currency is a political as well as an economic project: of course it is. A serious political debate is taking place in Europe today--but it is not between those supporting the caricature of federalism and the super-state and those supporting subsidiarity; the real debate is between nationalists and unionists.
As the Chancellor made clear, there is no federalist plot or project for Europe. What there certainly is, however, is a unionist argument within Europe. I am a unionist when it comes to Europe, for exactly the same reason that I am a unionist in the debate about the future of the United Kingdom. I oppose nationalism in Europe for exactly the same reason that I oppose it at home. That is because I believe that the peoples and nations of Europe grow stronger and are enriched when they co-operate, combine and pool their sovereignty. That is the real argument that is going on, not the absurd argument and accusations about a federal super-state. The real argument is between
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I cannot understand those Tory Members who are staunchly unionist when it comes to the multinational Union of the United Kingdom, but somehow transform themselves into nationalists when it comes to addressing the same issues in Europe. I find that illogical, just as I find it illogical for some Opposition Members to be nationalists--Scottish nationalists, for example--in the United Kingdom, but unionists in Europe. I find those positions inconsistent.
I do not think that we should hide from the fact that there is a political argument behind the case for economic and monetary union. It is not simply a dry and bloodless argument over statistics; politics is at its heart, and those of us who have a political belief in an ever closer union should be happy and proud to declare that.
The economic arguments are also vital. Some economic issues have been identified today as obstacles in the way of monetary union. The right hon. Member for Wells (Mr. Heathcoat-Amory), for example, advanced an argument that has become quite familiar in the debate--that Europe is not what the economists call an optimal currency area. In other words, the regional differences between European countries are too great to permit their currencies to be locked together without the risk of dislocation and turmoil in those countries.
Although it is used a lot, I do not consider that a serious argument. It is obvious that none of the national currencies that currently exist in Europe occupies an optimal currency area; it is absurd to think that they do, or that they ever did. Europe's existing national currencies were not based on any rational calculation by a committee of economists: they are the product of historical and political evolution. There are huge regional differences within the existing national currency areas.
If the north of Italy were a separate country--as some northern separatists would like it to be--it would be the richest country in Europe; yet that zone of growth in northern Italy shares the lira with regions such as Calabria and Sicily, which are notorious for being among the most stagnant and underdeveloped in Europe. Likewise, no one can pretend that the highlands and islands in Scotland and the south-east of England share an optimal currency area--yet they share the pound, and both are affected by the decisions of the Chancellor and the Bank of England.
Of course there will be regional differences within the currency area of the new euro, but there are equally great differences within the existing nation states in terms of economic competitiveness, growth and unemployment. We find all those differences in the existing national currency areas. Just as the pound and the lira must respond to the different economic conditions and prospects in Britain and Italy respectively, so the new euro will have to respond to regional differences in the countries that sign up to the new single currency.
There will be one absolutely vital advantage: unlike the Bank of England which, as far as I know, has no voice representing the interests of the highlands and islands, the new European central bank will have representatives from all the nations that sign up to the new euro. Its decisions will therefore be properly representative of all the
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Another argument commonly used against monetary union is that Europe is increasingly stagnant and uncompetitive economically and that such stagnation is made worse by the need to deflate European economies in order to meet the single currency criteria on inflation and borrowing. It is astonishing how widely that pessimistic and gloomy view of Europe has spread beyond its natural home on the Tory Back Benches and into the media. However, if we examine the statistics, we see that the reverse is true.
If we take the European Union as a whole and take its currencies as a single currency, we find that last year the European Union enjoyed growth of 2.5 per cent., that European Union inflation was below 3 per cent. and that it enjoyed a trade surplus of $145 billion. Indeed, were it not for the UK, the trade surplus would have been even greater. Europe has had a trade deficit in only three of the past 15 years.
Mrs. Edwina Currie (South Derbyshire):
I am delighted to be called relatively early in this two-day debate and put on record my pleasure in the fact that we are having this debate. It is about time that the importance of European issues was recognised by the business managers in the House. It took a lot of effort to get a two-day debate, and I hope the fact that nearly 100 Members have asked to be called to speak is taken into account when such matters are next discussed. Indeed, I hope that we are setting a precedent and that future European Council meetings are preceded--preferably in good time--by a two-day debate in the House, which will give far more of us an opportunity to be called.
The Father of the House, who spoke earlier, was absolutely right. It is about time that members of our Front-Bench team spoke far more positively about Europe. What worries me is that by not doing so, Cabinet members and members of important Ministries and Departments such as the Department of Trade and Industry and the Treasury are making a rod for their own backs or, indeed, for our backs. Where no enthusiasm is expressed about the European Union and its developments, doubt will tend to creep in; and if no information is made available, even from the Government, about any proposals--their complexity and their advantages and disadvantages--anxiety takes its place. Doubt and anxiety are now the prevailing emotions that pervade much of the discussion in the country at large.
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I should like to hear from every member of the Cabinet the same type of robust speech in defence of Europe that we have heard from the Chancellor today and, indeed, in the past few weeks. Would it not be wonderful if the Home Secretary spoke in favour of the European Court of Justice? Would it not be absolutely terrific if the Secretary of State for Social Security made positive suggestions as to how the unfunded pension liabilities of our colleagues overseas might be dealt with, and if he made available to them details of our experience in a friendly and constructive tone? We would gain a tremendous amount in this country and overseas if we adopted that approach.
In particular, I should like to hear far more Conservative Members and Ministers talk about how we gain from membership of the European Union. I should like to hear the same from Opposition Front Benchers. In the next few weeks, as we go into the general election, I hope that the Opposition do not start to back off; indeed, I look to one or two Labour colleagues who I see nodding at me to ensure that it does not happen.
Membership of the European Union is especially relevant to my constituency. The unemployment rate in South Derbyshire is 4.5 per cent. That must be one of the lowest rates in any industrial area in Europe, perhaps anywhere on the entire continent. It is partly due to the advent of Toyota, which has brought the largest inward investment that Europe has ever seen. In my area, it means jobs and exports. In fact, the United Kingdom has had the lion's share of inward investment to Europe from outside, and we ought to make it absolutely clear why that is so.
What we have tended to hear from the Government is that we have gained that inward investment because the UK is different from the rest of Europe. I should like to hear them say that it is because the UK is a member of the European Union and that, were we not, Toyota would not have given us a second glance--nor would most of the other overseas companies that have invested so heavily in us and are still doing so. We must make it clear that it is because we are a member of the European Union that these companies come to us. We must never let anyone in government, or out of it, forget that.
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