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9.3 pm
Miss Anne McIntosh (Vale of York): I welcome the debate. I recognise that the European Union now permeates every aspect of domestic as well as foreign policy. I have a particular interest in transport, and I note that the Amsterdam treaty will extend co-decisions to transport matters. There will be exceptions in regard to competition rules and negotiations with third countries. Can the Minister explain the Government's position on state aid? Will the Government press for the ending of any further state aid, especially for airlines--Air France, Iberia, Olympic Airways and a catalogue of other carriers that continue to enjoy state aid?
Ports also enjoy state funding in certain member countries. Horticulture even makes possible the provision of cheap energy, particularly in one member state. Pork production is currently enjoying a subsidy in France and Germany. Government intervention would be very welcome.
The highlight of 1999 will be the revision of structural funds, and the balancing of those receiving such funds with applicant countries. It is generally agreed that the population level in respect of receipt of structural funds will be lowered. The impact on the United Kingdom and, particularly, on my constituency will be substantial. The Vale of York enjoys farm subsidies on a generous scale, Konver funding to train those with defence industry skills for civilian employment, 5b funding for poor farming areas in the hills and general training funds under objective 3.
The hon. Member for Nottingham, South(Mr. Simpson) struck a chord. Not only will his area suffer job losses through the loss in the defence industry; other areas, such as Chelmsford, will suffer heavy loss as well.
The objectives are being reduced from 7 to 3 and the Community initiatives such as Konver are set to disappear, but it is not clear what will replace them. I am a little concerned that responsibility for the negotiations is being shared between two Departments: the Department of Trade and Industry and the Ministry of Agriculture, Fisheries and Food. We need to ensure a co-ordinated approach in those negotiations.
The length of the transitional period for the various programmes is not yet clear. Whether other member states will agree to set key criteria as a percentage of gross domestic product, rather than just unemployment, which would penalise us, is not yet known. Some guidance on those negotiations would be helpful.
The Department of Trade and Industry is minded to identify "pockets of rural deprivation". Again, it would be helpful to have more details. I accept that we are in the middle of a farming crisis that is unprecedented in my lifetime, affecting every sector of farming. The loss of income from subsidies will be compensated for by direct payments to farmers under common agricultural policy reform, where appropriate, and by compensation for environmentally friendly schemes.
Rural development is a theme that will loom large, bearing in mind the impact that the farming community has on the whole rural economy, including contributing to market towns and local prosperity. I hope that, in their regulations, the Government will bear in mind the impact that the reform of CAP and structural funds will have on areas such as North Yorkshire. Traditionally, farming in
that area attracts low incomes, increasing the difficulty of finding homes for farm workers; they also face travelling further to work.
Agenda 2000 is a top priority for 1999. With the agreement of our European partners, the Government have set a deadline of March. I am sure that the Minister will appreciate that the European Parliament has agreed First Reading and, as the Commission refused to support a number of key amendments, the reports have been referred back to the relevant committee. The European Parliament will find it hard to meet the March 1999 deadline.
Clearly, that timetable has implications for the timetable for enlargement. I welcome moves towards enlargement, particularly for the former communist countries and Baltic states. Earlier in the week, I raised the threat of higher duties on pork with the Minister of State, Foreign and Commonwealth Office. I wonder whether she has had time to examine that matter and to find out whether it is true that the Czechs, Poles and Hungarians are threatening to break the Europe agreement. That would be worrying. I hope that the Government will do everything in their power to prevent such a move.
A particular interest of mine and, I am sure, of many others is duty on wines, beers and spirits. Duty-paid goods and their import for other than private, individual use is becoming a huge embarrassment to the Government. Bootlegging not only denies the Treasury of income, but damages the trade and employment opportunities of our wine merchants, brewers and distillers. That is unacceptable.
Rather than increase the number of Customs and Excise agents to apprehend culprits, it would be far better to lower the duty that is paid in this country and to raise the level of tax earned in that way. Better still, does the Minister think that she can persuade her European partners such as France, Spain, Belgium and Greece to raise the duty charged on their home-produced wines, beers and spirits? So much for tax harmonisation.
Duty free sales are scheduled to stop on 30 June 1999. Mario Monti, the commissioner responsible, claims that duty free sales have no future in a single market. I entirely agree--if the single market were complete, there would be no place for duty free sales.
When there is no harmonised rate of tax and duty charged, nor any prospect of harmonisation, with rates varying from 3 per cent. in one country to 33 per cent. in another, there are strong grounds for a reprieve, allowing duty free sales to continue for the foreseeable future. The outlook in that regard is bleak. The Commission has announced that the present rules on duty free will apply to duty free sales after 1 July 1999, leading to the bizarre situation of a bottle of whisky attracting different prices on the same route from, say, London to Corfu, depending on which country's airspace the plane is flying in and on the duty charged in that airspace. That is nonsense and I hope that the Government will help to deal with it.
The European Union continues to hold many challenges for the Government and for our relationship with our EU partners. There is real scope for tax harmonisation, which the Foreign Secretary assured us would normally be within the national remit alone. I believe that the scope lies in social security taxation. The extremely high rate charged in some EU countries amounts to a tax on jobs.
If our partners really wanted to create an employment strategy for Europe, they would amend their social security provisions. Businesses, not Governments, create jobs, but Governments do tempt businesses to create more jobs by lowering social costs. I urge them to do so.
Mr. Oliver Letwin (West Dorset):
I want to make just two points in what is unremarkably--those of us who have attended many of these debates know the familiar pattern--a very thinly attended House. That is despite the fact that what we are debating is probably the most important issue to face this country, not just at present but for 300-odd years. Such is the nature of parliamentary democracy.
I want to comment on the character of the debate and the character of the Government in relation to the debate. The Government pride themselves on being modern. That is probably the single greatest thing on which they pride themselves. Yet, in an odd way, in this, the most important of all the debates facing the Government in the coming years, they are very ancient rather than very modern. They are out of date, not with the trend. That is because, unlike most hon. Members who have contributed to the debate--probably in private and unknown to the greater public--the Government have failed to recognise the fact that, as has been alluded to by many of my hon. Friends and many Labour Members who have now departed, we are on the verge of a United States of Europe.
That is not something that the Government will be able to stop. They can decide whether or not to be part of it, or rather, they can put that choice to the British people, but they cannot stop our partners moving in that direction. It would be a vain attempt and the Government will not make it. The Government are old fashioned in attempting to deny that that is the fact. It is also dishonest to attempt to deny that, but I shall dwell on it less because it is not an attack that would carry much weight. However, the fact of being old fashioned may, conceivably, strike a chord in the mind of some Ministers.
That is not my main point. I want to move the debate on a stage. I am bored with the period of prophecy. The period of prophecy is over. We know the facts and we know what is happening. We have a decision to make. The remarkable thing is that, because for so long--I regret that this has occurred within my party and firmly betwixt my party and others--we have debated the question of prophecy, we have forgotten to debate what decision we want to make. As one of my hon. Friends pointed out, the rhythm of the dialectic has been that we start by hearing that something will never happen and that it will be resisted to the ultimate, and then we hear that it is inevitable. In that rhythm of dialectic, there is no discussion of whether it is a good or bad thing. As a nation, that is what we now have to face. We have to confront the question to which we were brought face to face by my hon. Friend the Member for Reigate (Mr. Blunt), which is whether we think that the United States of Europe is something to which we want to belong.
I do not suppose that, in seven minutes, I can give the final answer to that question, but I hope that I might prod those few hon. Members in the Chamber, and those perhaps two or three recondite journalists who occasionally read our debates in their spare evening hours, into thinking about their response to the question. It is a poor outlook for the country if we do not have a response. It is a very poor prospect for the United Kingdom if those engaged in the debate in Parliament have not yet even begun to consider the question--which way the decision should be made--and no arguments are heard from either side of the House.
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