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7.21 pm
Mr. John Cryer (Hornchurch): Like the hon. Member for Rochford and Southend, East (Sir T. Taylor), I opposed joining the Common Market in 1975. The difference between us--apart from the fact that he was Member of Parliament for Glasgow, Cathcart and I was 11 at the time--is that he opposes the single currency on the ground of English nationalism, which is a principled position, while I oppose it for good, solid, democratic, Labour reasons, to which the Labour party clung for a long time. It has not entirely abandoned them, but it has moved away from them in the past few years. Clearly, my view brings me into conflict with many of my hon. Friends, who perceive the European Union to be a liberal and enlightened force for good in the world. I do not impugn their motives; they genuinely believe that the European Union is a force for good. However, reality does not bear that out.
The starkest example is not from within the European Union, but is provided by its record in the third world, towards which it has behaved in a way that is reminiscent of the colonial ambitions of last century. It has ridden roughshod over the third world, and treated some of the poorest countries in the world contemptuously. The Select Committee on International Development has done good work in exposing the way in which the European Union, under the Lome convention, manoeuvres third world countries into taking on disadvantageous trading arrangements, and tries to remove barriers that have been put up by democratically elected Governments--not only in countries but between Governments--so that those countries can be more easily exploited by the big banks of Europe and multinational companies based in Europe.
European Union aid has been mismanaged and is mired in corruption. The Commission has direct control over approximately a third of Britain's aid budget to the third world--that is a third of £2 billion. For example, two or three years ago, the Commission dreamt up a scheme to help the Guarani indians in Paraguay. That was a laudable aim, but the Commission was told not to plough any of the money--which was £12 million--into Paraguay to help the indigenous indians until their land claims had been sorted out, in case the money was used for corrupt deals, bribes and seedy activities.
Last year, the Commission decided to start handing over the money as part of phase 2 of the operation. Two independent reports pointed out that hardly any land deals had been settled. One report was prepared by St. Andrew's university and the other was by Dr. John Palmer, a British anthropologist, who pointed out that only one out of the 47 land claims had been settled. Later, Jonathan Mazower of Survival International prepared a report, which found that indigenous indians continued to sleep on the streets and to live in extremely poor and
deprived conditions. Nevertheless, the Commission did not care and, against the opposition of the United Kingdom Government, it ploughed the money into Paraguay. That money is now helping to finance bribery and corruption. That is only one example. Corruption is rife in the European Union's dealings with the third world.
Dr. Jenny Tonge (Richmond Park):
Surely the hon. Gentleman does not condemn all the European Union's actions in the name of development. The Lome convention has protected the banana growers of the Caribbean from having to resort to other crops, such as types of drug, to make a living. It has done much good, and it may disappear soon. Many good aid projects come from the European Union. I accept that some are inefficient and misplaced, but not all of them are in that category.
Mr. Cryer:
There are probably examples of good aid projects, but the European Union and the Commission are structurally mired in corruption and mismanagement. While we are on the subject of bananas and the third world, let us consider the European Union delegation to the World Trade Organisation in Seattle. A resuscitated multilateral agreement on investment is hidden among the delegates' position papers. The WTO had originally intended to agree the MAI some time ago. It was dropped because of enormous opposition, not least popular opposition, which continues. However, the Commission has revived it, stuck it in the proposals to the WTO and taken it to Seattle. Despite the fact that it is a slightly watered down version of the original MAI, if it is adopted, multinational companies will be able to sue elected Governments for implementing the policies that they were mandated to carry out.
Against that background, economic and monetary union can be seen for what it is--a plan by a small, rich, white club of countries to institutionalise monetarism while exploiting the third world. Yet those of us who point out the deficiencies in the system are condemned as illiberal luddites, who live in the past. I have heard no real justification for the Maastricht treaty, which is a clear institutionalisation of monetarism. The right hon. Member for Horsham (Mr. Maude), who signed the treaty in 1992 is now shadow Chancellor and is hardly a dyed-in- the-wool socialist. He believed at the time that the treaty made a strong case for monetarism.
I have read the Maastricht treaty. As I turned the pages, my heart sank to my boots. It is a monetarist's poisonous dream. I have never heard a sound justification for handing over enormous power to bankers who sit in Frankfurt and are removed from the people about whom they make decisions and whose lives they affect. They are unelected and unaccountable.
Monetary policy is currently more important than it has been for a long time. In the 1940s, Britain had interest rates of 2 per cent. or 3 per cent. Fiscal policy was used to keep the lid on inflation and to control the economy. That system has largely been abandoned by many western European Governments. Monetary policy has become increasingly important, and powers have been handed over to bankers headed by Mr. Wim Duisenberg.
The next stage will involve establishing a central tax-gathering mechanism. A single currency has never been established without some central tax-gathering
mechanism. That is a step on the path to political union. If hon. Members do not believe me, let us consider the views of some of the key supporters of the single currency. Hans Eichel, the German Finance Minister, argued:
Mr. Cryer:
It is a bit embarrassing to hear all the cheers from the Opposition Benches. As I have said, I am not a little Englander. I oppose the single currency for good, sound, democratic Labour reasons. That is what we did in the early 1970s and we should still do so today.
Mr. Bercow:
I am grateful to the hon. Gentleman for giving way, and I endorse the thrust of what he has said. Does he agree that it is important also, in the light of what my hon. Friend the Member for Wycombe(Sir R. Whitney) has said, to recall the remarks made by the former Irish Prime Minister, John Bruton, who said:
Mr. Cryer:
The key phrase is "democratic legitimacy". The EU as it stands will never have any democratic legitimacy and the same is true of reform of the common agricultural policy--I do not see how it can be done, and the ability to carry out such reform is simply not in the current system.
Sir Raymond Whitney:
My hon. Friend the Member for Buckingham (Mr. Bercow) referred to a former Taoiseach talking about freedom of political action and monetary union. Does the hon. Gentleman not recall that, for decades, the punt and the pound were linked? That seemed to have no impact in restraining the foreign policy of the Irish Republic.
Mr. Cryer:
We could have come out of such an arrangement at any time, but the single currency and EMU
I respect the views of my hon. Friends and know that they are genuinely held, particularly by my hon. Friend the Member for Harlow, but the reality of the record of the EU and, in particular, the Commission is completely at odds with the perception held by some of them.
"We will now strive towards political unification . . . EMU will not be enough."
Wim Duisenberg--that loveable mop top and President of the European central bank--said:
"The process of monetary union goes hand-in-hand with political integration and ultimately political union."
In 1994, the President of the Bundesbank, Hans Tietmeyer said:
"In my opinion there is good reason to believe that, to ensure lasting success, a monetary union requires--over and above the joint central banking system--a more far-reaching political association than that defined in the Maastricht Treaty."
My hon. Friend the Member for Harlow (Mr. Rammell) mentioned the current Prime Minister of Spain and to answer him I refer to Felipe Gonzalez, the previous Prime Minister of Spain, who I would have expected to have more in common with my hon. Friend and I politically. He said recently that
"the single currency is the greatest abandonment of sovereignty since the foundation of the European Community . . . we need this United Europe . . . we must never forget that the euro is an instrument for this project".
Hon. Members:
Hear, hear!
"We must recognise that political unity of purpose will be vital if the euro is to work. Countries will not be able to dine a la carte at the European table any more . . . Europe needs to develop political institutions which have sufficient democratic legitimacy to demand sacrifices of Europe's peoples and to mobilise them in a common cause."
Could it be any clearer?
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