Examination of witnesses (Questions 542
- 559)
TUESDAY 25 JULY 2000
THE RT
HON GORDON
BROWN, MR
GUS O'DONNELL,
MR JOHN
GIEVE, MR
ADAM SHARPLES
and MR ED
BALLS
Mr Fallon
542. Perhaps this is a question that straddles
both spending and EMU. Given your commitment, Chancellor, to long-term
economic stability, presumably you welcome today's confirmation
that the Prime Minister will serve a full second term?
(Mr Brown) I do not hear what you say and I have not
heard any reports about some confirmation.
543. When you spoke to the House about EMU in
October 1997 you said that if we left the option open "...
There would be instability, perpetual speculation about `in or
out', `sooner or later', which would cause difficulties ... for
business and industry."
(Mr Brown) Who are you quoting? You are quoting me,
are you?
544. I am quoting you, Chancellor. In a statement
to the House you said: "... instability, perpetual speculation
about `in or out', `sooner or later' which would cause difficulties
... for business and industry." That was pretty accurate,
was it not?
(Mr Brown) I hold to the statement that I made in
October 1997. I do not know whether you are quoting from that
statement at the time but that is the statement which is the statement
of Government policy. It was a statement that did four things.
One is it set out the attitude to the principle of a single currency
where we have a clear position. Secondly, it said that while there
was a constitutional factor involved in the decision, we did not
think constitutional issues were an insuperable barrier to joining
the single currency. Thirdly, it set out the economic tests on
which we would base our decision. And, finally, it said that if
a decision was made it would be the people that would decide.
These are the four pillars of our approach to the single currency
and that was what the statement you are referring to was all about.
545. But if it was so clear three years ago
why have we had Ministers saying such different things in recent
months?
(Mr Brown) All Ministers support the five tests and
all Ministers support the fact that if a decision were recommended
there would be a recommendation by Cabinet and then by Parliament
and then a decision made in a referendum. You only need to look
at the speeches that have been made to see that is what Ministers
are saying.
546. Are Ministers now free to be persuaders
for the principle of the Euro?
(Mr Brown) The Government has said that it sees the
benefits of the principle of a single currency. What it has also
said is that the economic tests that we have have got to be met.
547. Do you regard membership as inevitable?
(Mr Brown) You are referring to what is often said
to be a speech by Robin Cook. It was not a speech by Robin Cook
and the tests would have to be met.
548. But do you regard it as inevitable?
(Mr Brown) The tests would have to be met. It is hardly
the case that if the tests have got to be met, and then the people
would have to make a decision, that a decision is a foregone conclusion.
It has to be a matter of the people making the decision after
a recommendation which could only be made if the five economic
tests were met.
549. So it is not inevitable?
(Mr Brown) The issue, as I say, is it has to go, first
of all, to a decision based on the assessments of the five tests
and then a referendum if that is what Parliament recommends.
Mr Fallon: Thank you.
Mr Ruffley
550. We all know that you are having the kind
of feud with Robin Cook that only Scottish people understand.
Can I ask you again: do you agree with the Foreign Secretary when
he says that he believes that United Kingdom entry into the euro
is "inevitable"? That is his belief and he said it on
6 July.
(Mr Brown) I have got Mr Cook's speech of 6 July here
and his speech refers to the five tests and his speech refers
to there being a referendum, and that is the speech that he made
on 6 July. You can try as much as you like to continue this line
of questioning. I stand by the policy that we set out in 1997
which has not had to change and will not change. For you to suggest
somehow that the policy has changed—
551. I am not. I am merely asking whether or
not you agree with your own Foreign Secretary?
(Mr Brown) I agree that the five tests have got to
be met and the matter will have to be resolved by a referendum.
552. How does your position on the euro differ
from Robin Cook's?
(Mr Brown) The Cabinet's position is, as I said, based
on these four positions. One, that the principle of the single
currency is acceptable to us. Two, that there are constitutional
issues but not the constitutional barriers that are insuperable.
Three, that we submit to an assessment early in the next Parliament
based on five economic tests. Four, that the matter would have
to be decided not just by Cabinet and Parliament but by the people
and a referendum. Now that is the position of the whole Cabinet.
553. The Treasury wants to make the decision,
as I understand it, as to whether the tests are met. Is there
any room in this process for the real First Lord of the Treasury,
the Prime Minister? Is it your decision on your own or will he
have an input?
(Mr Brown) What I actually said, if you would quote
me as accurately in the speech I made to the Lord Mayor's Banquet,
was that the tests would be a matter for the Treasury and the
Government. You would expect the Treasury to make a first assessment
but it is a matter for the Government. It is a matter for all
the Government and the Prime Minister is at the head of the Government.
554. You will let the First Lord of the Treasury,
your boss, have a say in whether or not the tests are met?
(Mr Brown) If you would quote me accurately, that
is exactly—
555. I am asking that question, what is the
answer?
(Mr Brown) If you would quote me accurately, that
was exactly what I was saying. It is a matter for the Treasury
to make an assessment but it is a matter for the Government as
a whole. That was what I said in the Lord Mayor's Banquet speech.
I think if you are going to persist in this questioning, you should
quote me accurately.
Mr Davey
556. Chancellor, the Economic Secretary came
before this Committee on 11 July and we quizzed her about the
Government economic policy and the five economic tests for joining
the euro. She told us in answer to one of my questions—and
I am quoting directly—"... We are not trying not to
meet them or to meet them". Do you agree with her?
(Mr Brown) Economic policy is being set in the interests
of Britain and the British economy. That is exactly what we will
continue to do.
557. I asked you whether you agreed with your
Economic Secretary?
(Mr Brown) That is actually what she is saying and
I agree with what she is saying, that economic policy is being
set in the interests of the British economy. It is not being set
in the interests of the Liberal Party or their position, it is
being set in what is in the right national economic interests
for Britain.
558. Chancellor, there is no need to react like
that. I was simply asking you whether you agree with one of your
Treasury Ministers—
(Mr Brown) And I said yes. Also, I explained that
what the discussion is about is whether economic policy is being
set in the interests of the country and it is being set in the
interests of the country.
559. I am glad to hear that. Then can I ask
you why you have got these tests because—
(Mr Brown) That is in the interests of the country.
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