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Lord Dubs: My Lords, will the Minister confirm that the Government gave as the reason for their disastrous showing in the recent local elections that they had not adequately presented their policies? Can the Minister explain to the House which of the Government's policies will benefit from better presentation?

Viscount Cranborne: My Lords, we do not live in a perfectible world. The policies of any government are always susceptible to better presentation. It seems sensible therefore that the Government should establish a Cabinet committee in order to try to reach ever nearer perfection in this matter.

Baroness Oppenheim-Barnes: My Lords, does my noble friend agree that there is a certain irony in this Question coming from the party opposite? As far as anyone is able to ascertain, it has no discernible policies whatever. Does not my noble friend think it would be a kindness to provide the party opposite with a similar committee in order to help it present its policies?

Viscount Cranborne: My Lords, my noble friend is entirely right. We are aware from the proceedings in yesterday's debate that the parties opposite would like to use public money to try to get them out of the hole my noble friend describes. I am glad to say that a number of people on this side of the House thought that that would be an even greater waste of public money than some of the policies the parties opposite advocate.

Lord Richard: My Lords, is the Leader of the House aware that we wish this Cabinet committee well in its endeavours? Judging from recent election results, the more government policies reveal, the less the people seem to like it.

Viscount Cranborne: My Lords, the noble Lord cannot have it both ways. Either government policies are being well revealed or they are not being revealed well enough, as his noble friend Lord Dubs suggested. I will be perfectly confident if the committee is able to do its job as well as it is beginning to do it. The more the Government's policies are revealed, the more the contrast with the policies of the Opposition will show to the Government's advantage.

Baroness Farrington of Ribbleton: My Lords, in his Answer the noble Viscount said that the committee will remain in place for the foreseeable future. Can he say at which point the Government would consider that they were too close to a general election and that selling the Government's policies might be in breach of using taxpayers' money to convince people for election purposes?

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Viscount Cranborne: My Lords, the rules are perfectly clear about when a government have to cease acting as a government and when they enter into the electoral arena. Those rules are set out. But the noble Baroness poses an entirely fair question by implication. I should emphasise that it is important for the committee to draw a clear distinction, and to make sure that a clear distinction is drawn, between the proper functions of presenting government policy and party political presentation. We are fortunate in having an explanation in paragraph 3 of what have come to be known as the Armstrong rules, which were issued on 1st February 1993.

European Union: UK Membership

3.21 p.m.

Lord Pearson of Rannoch asked Her Majesty's Government: Whether they believe that the United Kingdom's European partners would deny the United Kingdom access to the single market if the United Kingdom were to withdraw from the Treaty of Rome and, if so, whether such denial would contravene the General Agreement on Tariffs and Trade.

The Minister of State, Department of Trade and Industry (Earl Ferrers): My Lords, the United Kingdom does not intend to withdraw from the Treaty of Rome.

Lord Pearson of Rannoch: My Lords, I think it is my duty to thank my noble friend for that reply, which, like the reply given to me by my noble friend Lady Chalker yesterday, does not make a tremendously valiant attempt to answer the Question on the Order Paper. Does my noble friend accept that it is our access to the single market as opposed to our membership of the European Union which confers a benefit on commerce and industry based in this country? Is he aware that Switzerland, which recently voted not to enter even the European Economic Area—that is to say, neither the European Communities nor the European Union—at present exports more than three times per capita than we do to the European Communities? Does that mean that life outside the European Union would really be so terrible for us?

Earl Ferrers: My Lords, my noble friend said that my noble friend Lady Chalker made a valiant attempt to answer his Question yesterday. I listened to it and I thought it was an excellent answer—not an attempt but a very good answer. The question which my noble friend poses is totally hypothetical. It is rather like him asking me what life is like in the next world. I cannot tell him. He will find out one day.

Lord Jenkins of Hillhead: My Lords, will the noble Earl assure us that if the noble Lord, Lord Pearson, continues to try to make an art form out of asking a series of tendentious, hypothetical and potentially damaging questions of this kind he will join with the noble Baroness in hitting him out of the ground as successfully as she did yesterday? Will he also bear in mind that the European Union has consistently tried to pursue a good neighbour policy towards the EFTA countries outside it (which is different from leaving the Community); and, in particular—as appears to be increasingly the assumption of those who believe that outside a single currency, if one

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comes about, we would be free (which we never were even under Bretton Woods) to do an infinite series of competitive devaluations, a continuation of a trend by which monetary sovereignty has succeeded in reducing the value of the pound from 12 deutschmarks to just over 2 deutschmarks in 35 years—that if we were to go on with that without consultation some reaction from the European Union would not be unexpected?

Earl Ferrers: My Lords, I dislike knocking my noble friend Lord Pearson out of the ground on any occasion other than this. I can assure the noble Lord, Lord Jenkins of Hillhead, that when he asks absurd questions like this he will get very sensible answers which I hope will knock him out of the ground and possibly into the ground. It is a fallacy to suggest that if we are members of the European Union—a union in which we have a great part to play, which happens to be of great benefit to us and by which we are a great benefit to it—and decide to leave, the other members will say, "You have decided to leave what you consider to be our rotten, stinking club but nevertheless we are going to be the greatest friends with you". That is impractical and it will not work. That is why we ought to remain in the Union and make it work to the best of our ability not only for the United Kingdom but for Europe as a whole as well.

Lord Bruce of Donington: My Lords, is the noble Earl aware that there has been some encouragement to speculate on this matter following a speech by M. Delors, who I believe has friends in all parties and in all quarters of the House, on 13th February last in which he made a very constructive suggestion indeed, doubtless with Her Majesty's Government in mind, that means ought to be found formally to agree a method by virtue of which existing member states could, if they so wished, negotiate their way out of the Community? Therefore, there is some legitimate speculation about this matter. I should be most grateful, as I am sure the House would be, if the noble Earl could confirm, in answer to the latter part of the Question, that Her Majesty's Government have quite independent relations with GATT irrespective of their representations through the European Community.

Earl Ferrers: My Lords, the noble Lord referred to M. Delors speculating. I think that the noble Lord is as good a speculator as my noble friend behind me. But let me tell him of one thing that M. Delors said. As a result of the United Kingdom being part of Europe, 40 per cent. of all the investment that comes into Europe from Japan comes to the United Kingdom; 43 per cent. of all the investment from the United States into Europe comes to the United Kingdom; and it was M. Delors who said that the United Kingdom is a paradise for investment. That is something which those who are against the Community ought to remember.

With regard to our relationship with GATT, we are a full member of the General Agreement on Tariffs and Trade and we have a perfectly good relationship with Europe as a result of being part of a free trade area which is also part of the General Agreement on Tariffs and Trade.

Lord Marsh: My Lords, does the Minister agree that, important to the United Kingdom as Europe undoubtedly is, the Euro-fanatics tend to exaggerate its importance in

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the modern world and that most serious international studies would place the market opportunities as the Far East first, the United States second and Europe third? It is important, but we do not really all want to become little Europeans.

Earl Ferrers: My Lords, the noble Lord is quite right. Anyone who takes a strong view at either one end of the spectrum or the other does a disservice to the whole. The fact is that we have a great part to play in Europe. We are part of Europe and we can help to guide Europe not only for the benefit of Europe but for the rest of the world. The noble Lord is also right on another point. Our relationships do not relate only to Europe. The Far East is a tremendously growing market opportunity. So is India. So are other parts of the world. We want to be part of that. Because we are part of Europe that enables us better to be part of the other growing parts of the world.

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