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6.1 pm
Mr. Alan W. Williams (East Carmarthen and Dinefwr): I am grateful to have been called so early in the debate. It is a pleasure to follow the right hon. and learned Member for North-East Fife (Mr. Campbell) and to have heard the other speakers in the debate, all of whom were positive, with the exception of the shadow Foreign Secretary, the hon. Member for Stratford-on-Avon (Mr. Maples). It is disappointing for Britain that there is a great divide within the Conservative party on Europe. In France, Italy, Germany and other European partner countries, there is not that divide. At Helsinki and other summits, their Governments have had the backing of their Parliaments in their negotiating stance, whereas the British Government go there with the Opposition unwilling to take part in developing that national consensus.
Dr. Julian Lewis (New Forest, East): Will the hon. Gentleman give way?
Mr. Williams: Not this early in my comments.
My position on Europe has been one of slow persuasion. Back in 1975, I voted no in the referendum. I supported our policy in 1983, but accepted that there had been a change for the 1987 election, when I entered Parliament. I will never forget the statement that Baroness Thatcher made on her return from the Rome summit in 1990. I was sitting where the hon. Member for West Worcestershire (Sir M. Spicer) is sitting now. Baroness Thatcher's manic anti-Europeanism in her statement that afternoon made the penny drop for me for the first time. Her Euro-scepticism was nothing more than pure undiluted English nationalism. As the right hon. Member for Caernarfon (Mr. Wigley) knows, I have spent the past 20 years fighting Welsh nationalism in my constituency. That afternoon, I felt that I had not fought Welsh nationalism at home to come here and adopt English nationalism from Baroness Thatcher or whomever.
Mr. Dafydd Wigley (Caernarfon):
The hon. Gentleman will recall that I voted yes in the referendum in 1975.
Mr. Williams:
That is also true of the Scottish National party. I am pleased that there is a wide pro-European consensus in Wales and Scotland. We do not have any Conservative Members representing Wales and Scotland in Parliament. Unfortunately, the membership of the Conservative party drives it more and more into English nationalism. The Conservative party does a disservice to the country and ultimately to itself. For at the next election, the electorate will have nothing to do with this rampant anti-Europeanism.
Dr. Godman:
In trying to be fair minded, I point out that many Scottish Conservatives, even though there are none in this place, are much more positive in their approach to the European Union than that lot on the Opposition Benches, as I am sure the right hon. and learned Member for North-East Fife (Mr. Campbell) will agree.
Mr. Williams:
I am grateful to my hon. Friend for those remarks.
My dramatic change of view happened on hearing the comments by Baroness Thatcher in 1990 after the Rome summit. Unknown to me, that very afternoon no less than the then Foreign Secretary, now Lord Howe of Aberavon, was equally hurt and he resigned within two weeks--and within weeks, Baroness Thatcher was out of office. From 1992 to 1997, the right hon. Member for Huntingdon (Mr. Major) was Prime Minister and his big problem throughout his premiership was holding his party together on the European issue. Since 1997, the pro-Europeans within the party have given up the ghost; they have allowed the sceptics to take over. The right hon. Member for Richmond, Yorks (Mr. Hague), the recently elected right hon. Member for Kensington and Chelsea (Mr. Portillo) and all the influences within the Conservative party are leading the Tories like lemmings to the precipice.
Dr. Lewis:
I thank the hon. Gentleman for giving way on my second attempt. According to the hon. Gentleman, one minute the Conservative party is deeply divided, and the next, it has given way to one side. Is it not a fact that the Conservative party is in line with 64 per cent. of the British people, who have made it clear that they do not want Britain to abandon the pound and replace it with the euro? We are united to the point that 84 per cent. of our members support the leadership's policy.
Mr. Williams:
I shall come shortly to some comments on the single currency, but the Conservative party is moving towards a position of wanting to renegotiate--that is the word that it uses--which is just a euphemism for withdrawal. It is moving rapidly towards withdrawal.
I have read comments made at the Conservative conference by the shadow Foreign Secretary and the hon. Member for Buckingham (Mr. Bercow), who is also a Conservative Front-Bench spokesman. They said that the alternative was to pull out of the EU. That is seriously being considered in certain Conservative quarters.
I return to the Government's line on the EU. Since May 1997, there has been much more constructive and positive engagement with our European partners. It is clearly our intent, over one or two Governments, to move to being at the heart of Europe in all its deliberations.
In his speech to the Lord Mayor's banquet a couple of weeks ago, the Prime Minister described Britain as a pivotal power in world affairs. In the past 12 months, we were influential in big decisions taken on the war in Kosovo. We helped not only to move British opinion, but to lead European opinion on what had to be done to bring Serbian atrocities to an end. We have influence not only in NATO, but in the United Nations and Europe--but before we can become that pivotal power, we have to join the single currency at some stage. When the economic pointers are in the right direction, it is the Government's intention--subject to the five economic tests--to join the single currency. I am a strong supporter, notwithstanding my realisation that, at present, the general public are wary and sceptical; possibly even 2:1 against joining.
I notice that the Confederation of British Industry is not against joining the single currency. Many leading businesses realise that, at some time in the future, we have to cross the rubicon. Next month, we look forward to a statement on our progress towards convergence. My right hon. Friend the Chancellor is running the economy extremely well; I understand that his public support rating is now ahead of that of the Prime Minister. The general public realise that the Chancellor has cleared up the problems that were left to us, and ensured that the accounts are in surplus. We have economic growth and stability and the prospects for the economy are extremely good.
My one criticism of our economic policy is the problem of the strong pound. As international confidence in Britain is so high, we attract speculators' money, which has driven up the value of the pound to unrealistic rates. That gives three spin-offs. The first is that there are great difficulties for manufacturers and for agriculture. In a sense, that has created a north-south divide. The service sector has not been particularly badly hit, but, during the past year, manufacturing has been affected by the strong pound.
The second relates to the balance of payments, where there are substantial problems that will become more apparent next year and in the following year. There will be difficulties in financing our trade because of those in-flows and out-flows. Thirdly, and most seriously, there will be problems for our membership of the euro. If there was a referendum on membership tomorrow, our membership would be unsustainable with the pound at its present level. We need the pound to fall by at least 10 to 15 per cent. against the deutschmark--to about DM2.60 or DM2.70. In a sense, I am critical of the Government's policy, although some matters are not directly under the control of the Chancellor or of the Monetary Policy Committee. However, problems are presented by the high value of the pound.
In autumn 2001, if we win the next election--as we are confident of doing--we shall review our position on membership of the single currency. During the two years until then, much could change, and that will help to change public opinion. The European economy is recovering. The European Commission's projections for next year anticipate that the European economy will grow by 3 per cent. That will help the value of the euro.
The EC's projections for the UK are even better than those of the Chancellor--it estimates 3.4 per cent. growth next year and 3.6 per cent. for the following year.
Mr. Bercow:
In the light of the hon. Gentleman's remarks, will he confirm that further cession of sovereignty on fiscal policy would not, for him, represent a constitutional objection to British entry to the euro?
Mr. Williams:
I see no political problem with membership of the single currency, but I am not going into any philosophical ideas beyond that. I can see no constitutional obstacle. Of the 15 members of the EU, 11 are currently members of the euro and have encountered no problems. All the indications are that Denmark, Sweden and Greece are moving towards joining the single currency. If we could join the currency at about the same time as those three countries, it would be in the interests of the people of Britain and, indeed, of the people of Europe.
The one problem--these comments are addressed more to my colleagues on the Treasury Bench than to the Opposition--is that we have promised to hold a referendum on joining the single currency. In the European elections, turnout in this country was only about 20 or 25 per cent., although the turnout of 41 per cent. in my constituency was the highest in Britain. I fear that those absurdly low turnout figures would be repeated in a referendum on the single currency. In that case, what interpretation could we put on such a referendum?
There is a parallel with the referendum on devolution held in Wales two years ago. Sadly, the turnout was only 50 per cent., and the vote in favour was barely 50 per cent. That is not a powerful mandate--I would have preferred an 80 per cent. turnout, and an 80 per cent. yes vote, but it was only 50 per cent. of 50 per cent. When we hold the referendum on the single currency, there will not be a 50 per cent. turnout, even though there may be a 50 per cent. vote in favour of joining. I wonder whether the result of such a referendum should be binding--[Hon. Members: "Ah!"]--I put that as a constitutional question.
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