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Mr. William Hague (Richmond, Yorks): On behalf of the Opposition, may I support some of the conclusions reached at Vienna, including the strong commitment to the universal declaration of human rights, statements on the importance of the middle east peace process, work on Kosovo and the desire to assist Russia, Ukraine and the western Balkans? May I welcome the Government's efforts to retain duty free? Does the Prime Minister agree that none of the steps set out in the original agreement is in place, so there is an overwhelming case for duty free to continue? Will he tell the Secretary of State for Health that, as he seems to have a different policy from the rest of the Government at the moment?
Is not the Prime Minister's habit of saying one thing to one audience in one place and another to an audience in another place finally catching up with him? He referred to the British rebate. Will he confirm that, while he was telling the British media that the rebate was not up for negotiation, he was busily telling the Austrian media that there would be wide-ranging negotiations in which the rebate would come up for discussion? If he did say that, did he mean it? If he did not mean it, why did he say it? If he did mean it, why not say the same thing in Britain? Will he cease his habit of saying one thing at home and something completely different abroad? Would not that be a much more effective way in which to ensure that his thoughts are reported accurately than simply whining about the British press?
Nothing causes the Prime Minister to complain louder than the British public being told about plans for tax harmonisation. He made great play of the fact that the communique rules out the possibility of "uniform tax rates". Apparently, that phrase was inserted at the Government's insistence. Why did we insist on that, when uniform tax rates are not the threat? Why did not the Prime Minister insist instead on an end to tax harmonisation? Why did he not call for the removal of references to "a tax policy package", "reinforced tax policy co-operation", or the far-reaching Commission "study on company taxation"? Why does not he guarantee to veto moves on the withholding tax or the so-called exchange of information--both and either of which would hit the City hard? Would not arguing against those real threats have demonstrated more backbone than arguing against imaginary threats?
Why did the French and Germans point out that the wording of the communique did not rule out harmonisation of specific taxes? Is that what the Prime Minister agreed? Why did the Luxembourg Economic Minister report:
What are the Prime Minister's guiding principles on Europe? What has happened to his defence policy? The Labour party manifesto states:
The Prime Minister says that he wants to be fully engaged in Europe, but would it not be more accurate to say that, whatever the circumstances, he will go with the flow? Earlier this year, the Government promised to make EU enlargement a priority. Why is the Prime Minister now content for the timetable for the entry of countries such as Poland and Hungary to slip further? Will he confirm that they may not be able to join the European Union until 2005 or later--15 years after they threw off communism and first expressed an interest in joining?
In their original Foreign Office mission statement, the Government promised to work for a Europe of independent nation states. How does that promise fit with this agreement at Vienna--an agreement that can be summarised in the first sentence of the communique:
So let us have some straight answers. Is that greater integration something that the Prime Minister welcomes? If it is, why does he not say so, instead of running around Europe giving more false impressions than Rory Bremner? If that is not something that he welcomes, why does he not do something about it? And if he does not know whether it is something that he welcomes, he does not deserve to be Prime Minister.
The Prime Minister:
First, let me deal with some of the issues of fact. The right hon. Gentleman took me to task on duty free. Might I remind him that the people that agreed to abolish duty free were the previous Conservative Government, in 1991? Of course, the difficulty that we have had in the duty free argument is that unanimity is required to change the plans precisely because of the agreement that the Conservative Government made. As for the right hon. Gentleman's claim that I said one thing to the Austrian newspapers and another to the British press, that is apparently based on an interview that I gave to an
Finally on the points of detail, the right hon. Gentleman said that we had agreed to shove the enlargement timetable back. We agreed no such thing. He said that our agreement on defence somehow undermined NATO. I suggest that he reads the recent words of Madeleine Albright, who has agreed that it is very sensible that Europe, in circumstances where the US does not want to become engaged, is able to do more of the cleaning up of problems in its own back yard. Only the Conservative party could see that as a negative move.
As for the right hon. Gentleman's strictures on tax, on unfair tax competition, he asks why I did not come out against the whole notion of greater tax co-operation. It could have been for the following reasons. First, before the general election, it was agreed by the previous Government that they endorsed
As for tax harmonisation, yes, we did agree words that made it very clear that uniform tax rates were ruled out, and made it very clear that no one was opposed to proper and fair tax competition. In the House of Commons on 9 December, I read the right hon. Gentleman a list of all those other Heads of Government who had made the same thing clear on behalf of their Governments--the French Prime Minister, the Spanish Prime Minister, the Irish Deputy Prime Minister and the Italian Finance Minister. I also read a quote from the Euro CBI, expressing a similar view.
I can add to that list now. The Austrian Prime Minister said:
There is only one discordant note on tax harmonisation--the person who said this:
"Everybody said there would be more tax harmonisation"?
How on earth did he get that impression? Presumably, the Prime Minister was there, standing up for Britain's interests. If so, why did nobody notice? Why did not the Luxembourg Economics Minister notice? If the Prime Minister was prepared to say in Vienna that there would be more tax harmonisation, why will he not say that in Britain? Why will he not tell this House and the British public what he tells other Heads of Government?
"Our security will continue to be based on Nato",
and contains a commitment to the Western European Union, which is clearly under threat. Following the Amsterdam summit, the Prime Minister described proposals along precisely the lines now being suggested as,
"an ill-judged Franco-German transplant operation".
Why has he changed his mind so dramatically? Do not the proposals in fact endanger our commitment to NATO?
"European integration has gained new momentum"?
The Prime Minister obviously agrees that that is a true statement of the facts, as he signed up to the communique. What has happened to the Foreign Secretary's assertion in August that
"Maastricht was the high-water mark of European integration"?
is the first phrase of the communique that the Prime Minister has signed--and it has done so while he has been Prime Minister, saying one thing in one place and something else in another.
"European integration has gained new momentum"
"the concern expressed . . . about the effects of special tax arrangements . . . and unfair competition, and"
believed
"that consideration is urgently needed of possible remedies to this problem".
They then agreed, at the Dublin summit in 1996, to set up the taxation policy group, and the first meeting of the group took place under the previous Conservative Government. I feel that that would have somewhat inhibited me in saying that it was all wrong. Of course, the then Government were quite right in doing that, because some of the tax practices across Europe are harmful to this country, so it is perfectly sensible to have a discussion about them. I may say that the code of conduct on tax says in terms, right at the beginning, that it is a political commitment, not a legal one.
"We are not against competition, and I am not against tax competition."
Let us see what the Greek Prime Minister said.
"Any effort to create a common tax policy would be pointless."
I could quote to the right hon. Gentleman virtually any newspaper anywhere in Europe, ruling out tax harmonisation in the terms that he has described it.
"We always accepted there was a case for minimal tax harmonisation . . . It was perfectly well known there was a case for minimal tax harmonisation for the development of the single market."--[Official Report, 9 December 1998; Vol. 322, c. 382.]
14 Dec 1998 : Column 611
Who was that? The shadow Chancellor last week. What did the Leader of the Opposition say this morning? He described the communique as the greatest threat to British independence for decades. More important than the Maastricht treaty, or the Single European Act?
That statement shows how extreme the Conservative party has become. If the Conservative party was in power today, we would not have an ally anywhere. We would have no influence, no authority and no ability to get our own way--nothing. The Leader of the Opposition says that he wants to build alliances in Europe: for heaven's sake, he cannot even build alliances in his own party.
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