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Mr. Davis: Of course it is a fair question. I am not sure whether it is an advantage, but I have read all the relevant treaties, including the Amsterdam treaty, more than once--three times in most cases. Almost all of them contain a multiplicity of objectives, which should be no surprise--they amount to the wills of 15 countries now, not to mention institutions such as the Commission, which operates virtually as a 16th nation state.
All member states must have asked themselves that question. I put the question to myself and discussed it during my three years in the Foreign Office, as my hon. Friend the Member for Banbury (Mr. Baldry) probably remembers. I always concluded that Britain's membership of the Union was not only to our advantage, but to the Union's advantage. We fill an important ecological niche--if there is such a thing--in the Union.
There were occasions in the run-up to the Amsterdam negotiations--I am being tempted to talk for much longer than I had intended--when Ministers from other countries told me, as Minister of State with responsibility for Europe, to veto the flexibility clause, for example. I said to them, not unnaturally, "You've got a veto. Veto it yourself." The response would be, "No, you must understand that some of us can't stand up to Franco-German pressure. Britain is the only country that can."
Regardless of whether that is true, the other countries collapsed on that issue and that was not the only time when Britain brought to bear in European negotiations a point of view that was unique, but very important to the European Union and its continued traditions of democracy. I shall now attempt to get back to the argument that I was making.
Mr. Blunt:
Will my right hon. Friend give way?
Mr. Davis:
This will have to be the last time.
Mr. Blunt:
My right hon. Friend is on a most interesting tack, so it would be a pity to leave it immediately. Surely a point comes at which the British national interest must be considered in the light of the role that we are being invited to play in Europe. The Government are already in that position. After 18 months, they are now almost completely isolated on tax harmonisation and have to look to the Spanish Conservatives for assistance. It will not be long before they are absolutely on their own--a traditional British position. The question that must be answered is whether that will always be worth it for the United Kingdom.
Mr. Davis:
The issue must always be in front of anyone who is representing our country or making these decisions for it. I am perhaps a little kinder to the Government than my hon. Friend is; I take the view that they are still learning.
The history of the European Union shows that, on almost every contentious issue, there is first an argument about a matter on which the veto applies. Then, if it is at all possible, the European majority tries to make that subject a qualified majority voting article, as happened with the working time directive, the pregnancy directive and a number of other directives. If that does not work, the matter ends up in the European Court. Most recently, we have lost zero ratings on industrial construction for commercial purposes, which I suppose is understandable, and, rather disgracefully, on spectacles and contact lenses--I cannot imagine on what basis the court found against us in that matter, but it did. If that process does not work, there is a Schengen outcome--the 13, 14 or 15 go another way, set up a caucus and organise things to their own advantage so that one finds oneself at a disadvantage.
In the next decade, we shall have to face such problems over tax harmonisation. There will be the perennial attempt to remove the veto at the IGC--I predict that that will be on every IGC agenda until the attempt is successful or until the nature of the Union changes. None the less, our membership is worth while, as we continue to benefit from it. However, we must always ask the question, as my hon. Friend the Member for Banbury said.
Before that minor diversion, I was making the point that the system that monetary union creates will lead to localised hot-spots of unemployment throughout Europe. What will be the reaction of the countries that face those hot-spots? Will they decide suddenly to pursue Thatcherite policies? Will they deregulate their labour markets, cut on-costs and create employment, as the previous Conservative Government did? Is that the probable future of the new socialist Europe? I hardly think so.
We do not need to guess. We already have an example--we can read the book. About two years ago, Renault closed its factory in Vervoerde in Belgium--near the constituency of Jean-Luc Dehaene, the Belgian Prime Minister--and moved the production to France. What did Jean-Luc Dehaene do? Did he say that Belgian workers should cut their costs; that Belgian managers should become more efficient; that his Government would cut the burden of regulation and taxation on industry?
Certainly not--of course not. That is ridiculous. He called for an end to social dumping. He called for more regulation and harmonisation, and for more rules to stop the free operation of markets within and between the nations of Europe. That happened last time, and it will happen more and more often under the pressure of monetary union-created hot-spots of unemployment.
The difference this time is that there will be a mechanism for that call for more regulation to be turned into action. That mechanism, I am afraid, is the social chapter--not just the social chapter, but most specifically. The social chapter was created to allow harmonisation of labour law, and the Government have explicitly signed up to legislation under the chapter.
Ms Rachel Squire (Dunfermline, West):
I agree with the right hon. Member for Haltemprice and Howden (Mr. Davis) that there is an advantage for Britain to remain as a member of the EU. When the right hon. Gentleman was a Minister, the Select Committee on European Legislation--of which I was a member--always appreciated his detailed knowledge of the issues on which we questioned him.
In common with my hon. Friend the Member for Crewe and Nantwich (Mrs. Dunwoody), I want an open and informed debate on all the issues of concern to us in Europe. However, the speech by the shadow Foreign Secretary, the right hon. and learned Member for Folkestone and Hythe (Mr. Howard), and some of the interventions from Opposition Back Benchers have demonstrated how difficult it is in this so-called mother of Parliaments to have informed and balanced debate on such issues of importance.
Many Conservative Members and the tabloid press consider it incompatible for someone to be both pro-British and pro-Europe. The reaction of some of the media to anything to do with Europe--not least this week--seems at times to verge on encouraging xenophobia. The reaction is one-sided--they see Europe as the enemy, bent on invading our glorious island. They ignore some of the advantages and benefits that our membership of the EU has given to us and to our constituents.
The right hon. Member for Haltemprice and Howden mentioned some of those benefits, and my constituents certainly appreciate the ease of travel, the access to goods and markets of the EU, and European funding. Many constituencies, such as mine, have seen their traditional industries and areas of employment destroyed, and European funding has assisted in their efforts to create new jobs and economic regeneration.
If we are to deal effectively with many of the issues of concern, we must recognise that that can most effectively be done on a European and an international basis. One example of that--on which the majority of Britons would agree--is that tackling effectively the drugs industry and international crime must be done internationally.
I recognise that a number of hon. Members want to speak, and that the EU is a large subject to try to cover. I have decided to focus my remarks on two areas, both of which provide big challenges for the EU--first, the common foreign and security policy, and secondly, the challenge of making Europe seem more relevant and accountable to the lives of the people whom we represent.
Britain's relationship with Europe has been one of constant development and change, as those who are familiar with our history will know. It may help to remind ourselves that the very concept of the nation state is a fairly recent development in terms of European history. We must disentangle ourselves from the views of those hon. Members who still seem to cling and hark back to the days of the glorious British empire.
By virtue of our history and geography, Europe is where we are now, and it is where we must have a leadership presence in the 21st century. I am keen for us to have more debates on a common foreign and security policy for Europe, and what that would entail. Because of our geography, history and international reputation--and our high standing among nation states in many parts of the world--we in Britain are in a key place to take a lead. The process of European enlargement means that we must engage in a constructive dialogue on foreign and security policy.
If we are to succeed on the social and economic fronts, we need a stable and peaceful Europe--one where there is a good understanding of the different perspectives, of which there are many, due to the different locations of current member states and those states seeking to join. It is only by communication that we can try to break down some of the years of hostility, distrust and suspicion that have existed between some of those countries, develop a dialogue of trust and share a common agenda.
The "Partnership for Peace" process has demonstrated the success of that communication and joint working. It has brought together nations which, not so long ago, were clear enemies, and it has helped to break down quickly some old attitudes and prejudices.
The European Union has a role to play in that, and it cannot be left entirely to NATO, although I fully agree that NATO is the bedrock of our defence in Europe. Only through a close and constructive relationship with our European partners on common foreign and security interests can we seek to make an even greater positive contribution on the world stage.
I want more debate on the common foreign and security policy. We have a real mix and match of categories of countries in Europe that are involved or interested in our foreign policy, security and defence. There are countries that are in both the EU and NATO; those that are in the EU only; those that are in NATO only, and want it to stay that way; those that want to be in both; those that have been promised membership of one or the other; those that want to join both but are feeling rebuffed; and those that want to stay outside but somehow have a special relationship with Europe.
We need to focus more on the subject. As they would say in Scotland, we have the auld alliance with France, which wants to remain semi-detached from NATO but to raise its profile in European security issues. As we have seen all too clearly, that mix and match has made it extremely difficult for us and our European partners to agree and stick with a common approach when facing an international crisis, whether in Kosovo or in Iraq. Many hon. Members are keen to have a more rapid and effective European response to such crises, which affect the peace and stability of Europe.
I welcome the way in which my right hon. Friends the Prime Minister, the Foreign Secretary and the Secretary of State for Defence are trying to open up the debate on the EU's defence role and the future role of the Western European Union.
We also need to consider the future of the industries that give a technological lead in the EU, many of which are strongly associated with the defence industry. Those industries have been telling me that they want the EU to be more active in helping them effectively to rationalise into a strong and effective competitor of our close and special ally, the United States.
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