BRITAIN AND THE COMMON MARKET

HL Deb 02 August 1961 vol 234 cc111-207

2.48 p.m.

THE SECRETARY OF STATE FOR FOREIGN AFFAIRS (THE EARL OF HOME) rose to move to resolve, That this House supports the decision of Her Majesty's Government to make formal application under Article 237 of the Treaty of Rome in order to initiate negotiations to see if satisfactory arrangements can be made to meet the special interests of the United Kingdom, of the Commonwealth and of the European Free Trade Association; and further accepts the undertaking of Her Majesty's Government that no agreement affecting these special interests or involving British sovereignty will be entered into until it has been approved by this House after full consultation with other Commonwealth countries, by whatever procedure they may generally agree. The tickle Earl said: My Lords, my noble friend the Leader of the House, who will speak in this debate to-morrow, has asked me to open it to-day, and to speak to the Motion on the Paper.

The first thing I should like to say about this Resolution which I move is that the House is not asked to-day to decide whether or not the United Kingdom should enter the Common Market. If that question has to be answered, it will be answered at some future date. To-day's Motion is concerned solely with the possibility of negotiating, with the European Economic Community, with the object of deciding whether terms of entry can be arranged which would justify Britain's membership. Your Lordships will have seen that our partners in the E.F.T.A. association have come firmly to the conclusion that the United Kingdom should negotiate, although they have reserved the final decision as to Whether an entry into the Common Market can be made until the negotiations are concluded.

But there is another piece of evidence which I myself should like to see—and I have no doubt your Lordships would like to see—before a final decision is taken on whether or not this country can enter the Common Market; that is, the exact effect that United Kingdom membership would have upon the economic fortunes of the Common- wealth. Several Cabinet Ministers have lately been round the Commonwealth, and have discussed with the Commonwealth Governments the possibilities of the United Kingdom's entry into the Common Market. I am sure that that was right. I am sure that it was a good thing to carry Commonwealth consultation to the point of Ministers going and consulting the Prime Ministers and other Ministers in their own Cabinets and in their own Councils. That is the way Commonwealth consultations should work.

As I think has been recognised, and as was said by my noble friend the Lord President, in answer to an inquiry from the noble Leader of the Opposition the other day, all the Commonwealth Governments recognised that the question of whether or not we should enter into negotiations with the European Economic Community was one which Britain must judge in her own interests and one which Britain had a right to decide. United Kingdom Ministers, in return, were able to give the Commonwealth Governments the assurance that not only would there be the closest consultation during the negotiations which are to take place but, before a decision was taken to enter into the Common Market, a meeting of Commonwealth Prime Ministers—or, indeed, any other kind of meeting which the Commonwealth might think to be desirable, and which was agreed between them—would be perfectly agreeable to the United Kingdom. I cannot say what type of Commonwealth meeting will best fit the circumstances, but that will obviously be for the Commonwealth Prime Ministers to decide at a rather later time.

VISCOUNT ALEXANDER OF HILLS-BOROUGH

My Lords, may I ask a question on that, as I am not quite clear? I have been looking at Command Paper No. 1447, which gave particulars of the communiqués issued at the time, and particularly after the visits, and I cannot see any assurance mentioned there as regards holding a Prime Ministers' Conference.

THE EARL OF HOME

I think that for the time it will be left open, because it will obviously be for the Commonwealth Prime Ministers to decide, rather nearer the time, what form of consultation they wish. There are, of course, other forms than a Commonwealth Prime Ministers' Conference, and it will be for them to decide. The Prime Minister has already said in another place, I think, that what they decide will be agreeable to us.

Although the discussions with the Commonwealth Governments were confidential, nevertheless it is clear to everybody that the Governments showed the liveliest interest, and in some cases, anxieties, about the economic consequences of Britain's entry into the Common Market. Some were concerned with temperate foodstuffs; others were concerned with tropical products, some others with textiles, some others with manufactured goods; and, of course, the effect of the possible United Kingdom entry into the Common Market leads to some very complicated calculations. It is partly a matter of calculating tonnages of butter, meat, wheat and other products. But it is not only that; it is a matter of trying to assess, for instance, that if there were to be a temporary loss it might be more than compensated for by a longer-term gain. It is a matter of forecasting the demand for Commonwealth raw materials and food, first of all under conditions which would prevail if things remain as they are, and secondly under conditions of expansion which might result if there were successful negotiations with the European Economic Community covering those Commonwealth products. Then again, apart from the economic anxieties, the Commonwealth Governments wanted a rather clearer picture of the political implications of the United Kingdom membership of the Common Market; and to that aspect I will turn in more detail in a moment.

Having considered the reports of the Cabinet Ministers who visited Commonwealth Governments—and we considered them with care and understanding, and with a jealous regard of our special responsibilities towards the Commonwealth countries—we decided that the answers to the questions which the Commonwealth Governments had asked could be found only through negotiation. Therefore, the Government decided to use the machinery specially provided in the Treaty of Rome for the purpose of enabling another country to establish relations with the European Economic Community. I think we have selected the proper way to negotiate membership, and the House will see from the terms of the Motion on the Paper that before a final commitment is made Parliament will have the opportunity to decide. That, too, I think is right.

My Lords, in this country, and no doubt in the House, there are many persons who have legitimate apprehensions. The noble Lord, Lord Strang, for instance, asked in debate the other day whether the derogations from sovereignty involved in the Treaty of Rome were different in kind from those involved in any other contract into which we have entered before. There are others who are concerned about the effects of our entry into the Common Market upon British agriculture. No doubt the noble Viscount, Lord Alexander of Hills-borough will have something to say about that.

There are others who perhaps have less tangible objections but feel by instinct that, whereas in the past we have done very well with the world as our market, very well under the Ottawa arrangements which gave us preference in Commonwealth markets, and very well in retaining the absolute right to legislate for ourselves across the economic board, entry into the Common Market may prejudice that: that it may be an adventure of which we cannot see the end and, therefore, dangerous. All of us who have our roots in our island history share those anxieties and instincts in some degree, but with the reservation of which I spoke before—on the nature of the terms that we can obtain for the Commonwealth—I want to give to your Lordships some of the reasons which lead me to incline towards membership of the European Economic Community, and certainly towards the process of negotiation, which I personally, think it is absolutely right.

I base my reason for inclining towards membership of the European Economic Community on certain assumptions. The first is that Britain wishes to retain her political influence on the world stage; the second that Britain means to retain her position as a leading partner in the Commonwealth and the largest generator of capital for development in that association; and the third that we wish to enjoy in this country rising living standards. My Lords, I believe—and I have said so many times in this House—that the basis of the political influence of the United Kingdom in the world depends fundamentally on our economic strength; we cannot fulfil our rôle in our world-wide alliances, we cannot be a reliable partner, and certainly not a leading partner, in the Commonwealth, unless we are rich; and that means richer than we are now. The experts have calculated that if we are to fulfil our commitments the world over, and to fulfil this rôle which I have described as a leading partner in the Commonwealth then we must earn roughly £500 million overseas more than we are doing now.

I want to ask now how we are to earn that and where, and to face facts even if they are rather inconvenient at times. We are now in the middle of an economic crisis. I see it is mentioned in the Amendment which the noble Viscount is to move. I am not going to comment on the Amendment very much, because my noble friend the Leader of the House will do that tomorrow after he has heard the noble Viscount move it. But at one point it says … regrets that Her Majesty's Government will be conducting these negotiations from a position of grave economic weakness; Well, my Lords, there is an economic crisis now, but I must remind the noble Viscount that this is one of a series of regular economic crises which have been recurrent since the last war, and each of them, whatever Government has been in power, has revealed the same essential weakness in our economy, and that is in the balance of payments. We are not earning sufficient foreign currency to sustain our commitments overseas. I think the reasons are these: that we are losing and have been losing for a considerable time our share in the increasing world trade; and within the Commonwealth, even where we have enjoyed a system of preferences, the proportion of our trade has been falling.

For the first symptom we have tried various remedies. We have tried exhortation by austerity; that was the remedy of Sir Stafford Cripps. We have tried exhortation by kindness and inducement; that was the remedy of my noble friend Lord Amory. As the noble Viscount the Leader of the House indicated in his speech in the economic debate only a few days ago, it may be that we could very quickly solve our imme- diate economic plight if we agreed that wage increases should be matched in every case by increased productivity and improved management. I think he was right and I hope that very wise advice will be taken; it has been given not only by him but by many other people. I myself, looking at the facts over the years, have felt bound to conclude that we shall hold our own in world markets only if to a degree we expose ourselves to the astringent of competition. There are other ways of doing that than entering the Common Market and none of them painless; but the Common Market at least has this advantage: that while it will expose our industries to competition, at the same time it will open up to them wide and new opportunities for investment and enterprise and expansions over that range of products which we are well equipped to supply. In part, then, I have tried to answer how we might earn some of this extra wealth, this extra £500 million which we have to find.

Now, where? I am not going to say more about that except this: that I do not believe that the United Kingdom can allow itself to be excluded from any important expanding market in the world. We cannot afford it; nor can our friends afford that we should do so. It is important, too, I think, that we should examine the question so often raised in this House by my noble friend Lord Balfour of Inchrye, and others, as to whether we could earn a very high proportion of this additional £500 million which we have to find within the Commonwealth. In theory we could do so, if the Commonwealth were to turn itself into a free trade area. But here again we have to face same facts, and one of the facts is this: that the United Kingdom's exports to the Commonwealth have fallen from 47 per cent. to 42 per cent. in ten years. In spite of the Montreal Conference, where we passed all sorts of resolutions to maximise Commonwealth trade, that tendency to fall has nevertheless continued and been intensified.

I was one of the strongest protagonists of the Ottawa Agreements. I believe the whole Commonwealth owes an immense debt to my noble friend Lord Swinton and his colleagues at the time who devised this system, because they provided an economic base on which the political cohesion of the modern Commonwealth was very largely sustained. But that was 30 years ago. An entirely different and perhaps unforeseen set of circumstances have intervened and a different situation exists to-day. Almost all the Commonwealth countries—and this I think is true from the oldest to the youngest—now want to become industrial nations in their own right. We have passed from the days when the Commonwealth countries sent us all their raw materials and we exported to them all our manufactures. They now want to exchange their own manufactured goods and build up their own industries and to protect them while they are doing so.

Other noble Lords like myself have been to these Commonwealth countries—for instance, to Australia—full of young, vigorous, manufacturing industries. Australia wants to trade with other countries, including Japan. In Canada at the time of the Montreal Conference we offered the Canadians to make a free trade area with them, but they could not accept it because they wanted again to build up their own industries. I have no complaint about this. I think now, looking back, that although this tendency may not have been fully foreseen at the time of the Ottawa Conference the process was really inevitable. But we must face what has happened as a result of it, namely, that while the United Kingdom has retained full free entry for Commonwealth goods, our system of preferences has been very gradually but certainly eroded. It is no matter of complaint; I think it is an inevitable tendency in the evolving modern Commonwealth in the twentieth century world.

Then, again, there are, of course, great possibilities in the developing markets in the great new Commonwealth countries in Asia and Africa—very large potential markets; but most of them have immense internal problems of their own concerning the growth of their populations, and, looking at the medium and short term ahead, it is very difficult to see how they can greatly increase their earnings of foreign exchange. Indeed it is necessary to-day to lend them the money before they can buy. I have no doubt we shall continue to do an enormous volume of Commonwealth trade. We can do more, but we can only do more—and this, I think, is a point we must realise—if our national income here continues to rise and expand, and that will happen only if we manage to arrest and avert this decline of our share in the increased trade in the world.

From the point of view of the Commonwealth countries who are exporters of temperate foodstuffs, I think there is one other aspect which must be given consideration. All Parties in this country are broadly agreed that the agricultural production in our own country here at home cannot be allowed to fall below its present level. Indeed, as the efficiency of our farmers increases the home producer will have a greater share of our market. But, with the best will in the world, there is a limit to what our people can eat in home-grown and imported foods. There is one other observation I should like to make, particularly relating it to entry into the Common Market, and that is this: the Common Market countries have not as yet formulated their agricultural proposals, and if we are to enter it will be good sense to do so soon, when we have a chance of shaping and forming their agricultural policy.

VISCOUNT ALEXANDER OF HILLS-BOROUGH

My Lords, I thought that they had been formulated but had not been actually approved because of Dr. Adenauer's opposition. Is that not so?

THE EARL OF HOME

No; they have not yet been formulated. They are in process of formulating them. All I am saying is that if we were to decide to enter there are strong arguments for doing so now, when we have still a chance of influencing their shape and direction.

When I add up these considerations—namely, the need for Britain to increase her earnings so that she can maintain her purchases of Commonwealth food, and the need for Britain to increase her standard of living; when I look at the paramount need of the Commonwealth for capital for development, and realise that we are one of the great sources which must continue to provide that capital; and when again I look at the physical limitation on the amount of imported foodstuffs which this country may be able to take over the next few years, that leads me to repeat what I said the other day in America when I was talking on this subject: that in my opinion it is quite likely that Britain can serve the Commonwealth better inside the European Community than she can outside it.

My Lords, I should like now to turn to the political implications of membership, remembering that I am placed almost exactly halfway between the pundit of Common Market doctrine, Lord Gladwyn, and the master of International Law and jurisprudence who sits on the Woolsack, and who will help me out if I go too far wrong. I should like to advance one general observation about sovereignty which perhaps I can do without too much dissent. It is that each surrender of sovereignty should be judged by whether or not there is a compensating gain. In fact, we are surrendering sovereignty in some degree all the time. The most obvious example is the North Atlantic Treaty Organisation; another example is the G.A.T.T. There are many examples that I could give. But when we are considering this question of sovereignty it is really a matter of balance of advantage.

We should not make sovereignty into a shibboleth. It is harmful to surrender it if the results damage the nation, but it is not harmful if, on balance, the results are beneficial to it. It occurs to me that the bachelor surrenders some of his sovereignty on marriage; but, by and large marriage benefits the human race. I ought not to push this analogy too far, because the noble Viscount will be saying that one ought not to marry two wives at once, and at least I am flirting with two. At any rate, I believe that it would meet with general acceptance if I said that when considering the surrender of sovereignty it is a matter of balance of advantage.

Let me admit at once that the Treaty of Rome would involve considerable derogation of sovereignty. Let me say also that the field in which there could be surrender of sovereignty is clearly defined and restricted to economic matters. When the Common Market is established it will, it is true, be the Commission and the Council who, for instance, will raise or lower the common tariff; it will be the Commission and the Council who will decide on trade agreements with third parties. I can- not, at this stage, when the Common Market is in a formative stage, look forward to the future and say whether any individual operation will be to the advantage or disadvantage of this country. But at this moment, I think I must say to Lord Strang that he is right in saying that, within this restricted field, derogations of sovereignty will be different in kind from any contract into which we have entered before. It is well that people should realise that, although I cannot forecast whether these derogations would be substantial or whether in any particular case the derogation of sovereignty would act against us or for us.

When I spoke to the House a week or so ago on this question of sovereignty, and the possible impact of derogations of sovereignty, I was talking largely of national political institutions; and I said I did not think that, in practice, countries would allow a derogation of sovereignty which impinged in a serious degree on their treasured national institutions. That is still my opinion. It was not based merely on the fact that no member country of the Common Market has yet shed any sovereignty at all, nor even on the hunch that they would not do so. It was based upon this solid fact: that the Treaty as it is written does not bring in the question of political sovereignty at all, and any extension beyond the terms of the present Treaty as it is written down needs the unanimous consent of the Council.

I would refer noble Lords to Articles 235 and 236. But in order to leave no doubts in your Lordships' minds I will read Article 235: If any action by the Community appears necessary to achieve, in the functioning of the Common Market, one of the aims of the Community in cases where this Treaty has not provided for the requisite powers of action, the Council, acting by means of a unanimous vote on a proposal of the Commission and after the Assembly has been consulted, shall enact the appropriate provisions. Article 236 underlines these points, saying that changes and additions outside the existing Treaty can be passed only if there is a unanimous vote in the Council. But my feeling was also based on the wider principle of International Law—that you cannot be bound to do more than you agreed by your signature to do. So, my Lords, I think it is clear that I must agree with Lord Strang that in the economic field, in this restricted field covered by the Treaty, derogations of sovereignty would be different in kind. Extensions of the Treaty would have to be agreed by unanimous vote. And, of course, if we were inside we should have the opportunity to control that.

I certainly would not advocate entry into the Common Market if we were going to exchange our traditional outward-looking policies, our historic outward-looking policies for that of a bloc mentality. That is not our objective—quite the contrary. If the needs of our E.F.T.A. friends can be accommodated, then the European Economic Community would embrace much of free Europe. If the needs of the Commonwealth can be met, that will open a very wide window looking out from Europe on to the world. I do not know whether your Lordships saw the result of yesterday's W.E.U. meeting when, in welcoming the United Kingdom's decision to open negotiations, I think practically all the delegates said how much they welcomed the opportunity of bringing the Commonwealth closer to Europe.

Nor do I think that our imagination should boggle, nor our vision stop, at the reconciliation of Europe and the Commonwealth. There is the Atlantic Community still beckoning to us to an even greater inter-dependence later on if we have the wisdom to take that course. Then again, I want to see Britain keep abreast of the trends of the future. Britain and America, on whose cooperation much of the peace of the world depends, have held for many generations a special position of trust and confidence in each other. But it would be an error to take that relationship for granted. Each of us, here and there, has to work to maintain it. And Europe is now on its feet again, thriving, confident and powerful. The centre of power and the weight of investment could well shift from this island of Britain to the Continent of Europe; and over 200 million people, my Lords, acting in concert, can exercise a greater political power and offer greater opportunities for investment than 50 million people. I suggest that as we look at this picture there is a strong interest for the United Kingdom to be inside this new power complex rather than excluded or on the periphery. When the United States and Europe are more nearly equal in their achievements, and more nearly shouldering equal burdens, then it will be more practical to join forces and men will be able to achieve a great new impetus to freedom.

My Lords, there is another trend which I have in mind, about which I may be wrong, because I am not an industrialist or economist, but I think it is becoming apparent. The great need of the world is for capital for investment. How is it to be generated most quickly? My Lords, it seems to me that there is a greater trend now towards trade among nations at equal stages of industrial development, and that has many advantages for us. It leads me to the conclusion that, if I am not wrong, if certain trends in trade are at present operating against us—and I think I have shown they are—we should exploit with double vigour those that are working in our favour; and I think the Common Market in Europe offers us and our industries these great opportunities.

My Lords, I understand the qualms and the anxieties. Perhaps the one that haunts us most is that somehow, in some way, Britain as part of Europe means that the Commonwealth partnership might lose its inspiration and that a great association of peoples which we have led and inspired would lose some material and moral values, which would be the loss of the whole world. I see that, my Lords. I feel that possibility; but I do not believe that it would happen. I believe that we certainly have in this country the political maturity, and I do not think it is arrogant to say the political genius, which not only would allow us to draw strength from the Commonwealth association and from Europe to ourselves but would contribute to each, to Europe and to the Commonwealth, from the reservoir of our experience after centuries of successful practice in international living.

Therefore again I come to the conclusion that there is a lot to be said for Britain's trying to come into Europe, to help Europe politically to gain cohesion and, at the same time, to continue our leadership of the Commonwealth. My Lords, although I cannot say whether Britain will enter the Common Market; nor can I say, until I have the evidence of what effect there will be on the Commonwealth from our negotiations, whether indeed we should enter the Common Market; yet time and again there come back into my mind the prizes which might result from doing so: the unity of free peoples which must be found, and must be found in Europe, if the challenge of Communism is to be met; and then, again, the picture of the three organised social and political systems of free men—the Commonwealth, Europe and the United States of America. Interdependence between those three would be a great prize for humanity. Those three together could set an example in vigorous living and unity of purpose which could inspire all men. They could, my Lords, set an example which other men and countries will aspire to follow, because our free way of life and our achievements, both material and moral, would be seen to be so closely akin to the hopes of all mankind.

Moved, to resolve, That this House supports the decision of Her Majesty's Government to make formal application under Article 237 of the Treaty of Rome in order to initiate negotiations to see if satisfactory arrangements can be made to meet the special interests of the United Kingdom, of the Commonwealth and of the European Free Trade Association; and further accepts the undertaking of Her Majesty's Government that no agreement affecting these special interests or involving British sovereignty will be entered into until it has been approved by this House after full consultation with other Commonwealth countries, by whatever procedure they may generally agree.—(The Earl of Home.)

3.26 p.m.

VISCOUNT ALEXANDER OF HILLS-BOROUGH rose to move as an Amendment to the above Resolution, to leave out all the words after "House", and insert: notes the decision of Her Majesty's Government to make formal application under Article 237 of the Treaty of Rome in order to initiate negotiations to see if satisfactory arrangements can be made to meet the special interests of the United Kingdom, of the Commonwealth and of the European Free Trade Association; regrets that Her Majesty's Government will be conducting these negotiations from a position of grave economic weakness; and declares that Britain should enter the European Economic Community only if this House gives its approval and if the conditions negotiated are generally acceptable to a Commonwealth Prime Ministers' Conference and accord with our obligations and pledges to other members of the European Free Trade Association.

The noble Viscount said: My Lords, I rise to move the Amendment to the Motion just moved, which stands in my name on the Order Paper. May I say at once that I am quite sure the whole of the House has enjoyed the manner in which the noble Earl the Foreign Secretary has presented his case in support of the main Resolution? He has a knowledge of the Commonwealth and he has a growing knowledge of international affairs which enables him to speak with authority and with an insight which perhaps is not at the disposal of all of us. If at times I may seem to disagree, if not so much specially with him as with the policy of his Government leading up to the present situation, then it is in no sense in lack of appreciation of the manner in which he has presented the case.

The Amendment that we have put down is borne in upon us, not, as you will observe, because the Party which I am honoured to represent feels that it is right to oppose in substance a request that the Government should be allowed to negotiate on the question of entering the Common Market. In any case, that is a position which on the basis of negotiation would in the long run have to be negotiated by a Government and no doubt pursued, if they wish to pursue it, with the authority of Parliament to its natural end. But we are not happy at all as to the manner in which this particular issue at this particular time has had to be raised, seeing that we have had on many previous occasions in Parliament discussions about this matter and in respect of which very specific pledges have been given, either that there was no intention to enter the Common Market in those existing circumstances, or else that in the event of that entry being made, then it could only possibly be made with conditions having been secured which would not be to the detriment of the other members of the Commonwealth.

I think it is rather necessary that we should refresh our memory upon one or two of the major occasions to which I am referring. I am thinking particularly of the debate which was opened in another place by the present Prime Minister when he was the Chancellor of the Exchequer, on November 26, 1956. It was a speech which was very broad in the area of debate which it covered in dealing with the general question of European trade. But it was also a speech which dealt very specifically in certain passages with the question as to how entry into the Common Market, which was only just then beginning to think of functioning, would affect the Commonwealth. I think that the House will therefore bear with me while I turn to the actual passages in the Prime Minister's speech on that occasion, when he was Chancellor of the Exchequer, and see what I have in mind.

He said [OFFICIAL REPORT, Commons, Vol. 561, col. 37]: Nevertheless, whatever we may feel about this problem, I believe that we all agree that it is quite impracticable for the United Kingdom to join such a Customs union. The Customs union is what the Common Market was at that preliminary stage. Further down in the same column he said: If the United Kingdom were to join such a Customs union the United Kingdom tariff would be swept aside and would be replaced by this single common tariff. That would mean that goods coming into the United Kingdom from the Commonwealth, including the Colonies, would have to pay duty at the same rate as goods coming from any other third country not a member of the Customs union, while goods from the Customs union would enter free.

I turn to the next passage that I want to quote from the same speech: We could not expect the countries of the Commonwealth to continue to give preferential treatment to our exports to them if we had to charge them full duty on their exports to us. Apart from that, our interests and responsibilities are much wider. I do not believe that this House would ever agree to our entering arrangements which, as a matter of principle, would prevent our treating the great range of imports from the Commonwealth at least as favourably as those from the European countries". I stress that quotation, because if the Government are going into negotiation with the Common Market on the basis that commodities will come free from them into this country, I take particular note of that passage from the Prime Minister's speech in 1956. There are many people—I think the noble Lord, Lord Gladwyn, included—who have urged that we should be forced to join the Market under any conditions and that we had better go in and join on the basis of the Rome Treaty. Then, I just quote one last passage from the Prime Minister on that occasion [col. 38]: So this objection, even if there were no other, would be quite fatal to any proposal that the United Kingdom should seek to take part in a European common market by joining a Customs union. I think that we are all agreed there". And he wound up that paragraph of his speech by saying: So that is out".

That is less than five years ago, and it makes us wonder exactly what all the events can have been which have led to such a change of mind on the part of the Government since then as shown by the manner in which they have been dealing with the Commonwealth issue in the present stage. The House will remember that from time to time in the last few months my noble friends and myself have drawn attention to the fact that we thought there ought to be more consultation with the Commonwealth. We have drawn attention to the fact that it was our view that, before the Government had gone as far as they had at that time already gone, there ought to have been, probably, a meeting of the Prime Ministers of the Commonwealth at which the matter could have been considered. But that, of course, does not appear to be the situation.

Now it seems to me, speaking personally, that the kind of declaration which was then made by our present Prime Minister, then Chancellor of the Exchequer, would have lulled the members of the Commonwealth into a certain amount of peaceful security; into the feeling that nothing really very serious was going to happen to them about this: and it is difficult to see what active steps the Government have taken from time to time to disabuse them of any kind of complacency on that score. However, when I come to the matter which was (providentially, I think) raised by the noble Viscount, Lord Elibank, last week, it indicates the kind of attitude which is abroad. I have secured the quotation from The Times to which Lord Elibank referred and which is with regard to the view of Mr. Menzies. It is from Perth, Western Australia, July 27—and this is, I think, a pretty pointed comment on some of the hopeful remarks made by the noble Earl who has just spoken: Negotiations with Britain as 'a separate, independent, uninhibited power' would be impossible if she joins the Common Market, Mr. Menzies, the Australian Prime Minister, said here last night. A decision on Common Market membership would be 'the most remarkable and crucial event in Commonwealth and Britain's history—outside of war—this century', he added. The free entry into Britain of German iron and steel manufactures, he said, presented the Problem of whether Germany—with a brand new industry—could compete on better than even terms with British industry. 'This is a tremendous decision on the economic side', he said. 'If they are right in going in it may have tremendous advantages. If they are wrong it may turn out to be fatal".

I think that shows the kind of intensity of study and feeling and anxiety on the part of the leaders of the Commonwealth abroad. I think I can say—I am perhaps being over-sentimental, but the noble Viscount the Leader of the House, probably quite rightly, in his own view, appealed to us on a patriotic basis in the economic debate—that surely we do not forget all the services that these people in the Commonwealth have rendered to us in the past great crises; not merely financial crises, but imminent, dangerous crises in the past, when they have given us their men, their money, their loyalty and their strength. Never have they let us down. In fact, the connections between, say, such a comparatively small and yet such a fundamentally vigorous population as New Zealand, with all their loyalty to us, are such as to lead them to say, when they come to negotiate with our Ministers, "Will you please remember that we have organised very nearly the whole of our market on the basis of our supplies to the United Kingdom?" And that is the fact.

If you take the point which was made (I am speaking from memory) by the present Chancellor of the Exchequer when he was Foreign Secretary, just before he took over the Chancellorship—I think it was about July 25, 1960—when dealing with the same problem as we are talking about to-day, in another debate upon trade in Europe, he pointed out that 84 per cent. of the trade of this country at that time last year was being done with markets outside the Six of the Common Market, and that the basis of our development in the Commonwealth had probably had a great deal to do with that balance, that proportioning, of the trade of this country with the rest of the world.

Though, as the Foreign Secretary has quite rightly said, we are certainly taking no decision to-day as to whether we finally enter the Common Market, nevertheless, when we go in we want, if possible, to lay down, as is laid down in the final Resolution of the House, if your Lordships will accept it, the fact that we note you are going to negotiate but that certain conditions will be laid down under which we shall be receiving the report of the Government when they come back to tell us the result of their negotiations.

I do not want to seem to be unduly suspicious, but I must say that when I came to look in the Report of the proceedings in the other place at the statement of the Prime Minister, which the noble Viscount gave us separately in this House on Monday last, my mind went back again to one which struck me as I was listening here. In that statement the Prime Minister said [OFFICIAL REPORT, Commons, Vol. 645, col. 929]: No British Government could join the European Economic Community without prior negotiation with a view to meeting the needs of the Commonwealth countries, of our European Free Trade Association partners, and of British agriculture consistently with the broad principles and purpose which have inspired the concept of European unity and which are embodied in the Rome Treaty. In so far as anything like the nature of a promise or pledge was made in the rest of the discussions which arose from that statement in another place, there was none in the statement itself. It seemed to me as if the Prime Minister in this statement was making the best of both worlds: trying to placate, on the one hand, views in the Commonwealth; and, at the same time, giving no adequate pledge which was anything like in line with the kind of pledge which was given by the Prime Minister in his speech in the other place in 1956.

My Lords, I, too, have been making a study of the communiqués—I do not suppose all your Lordships have yet had time to read them; they have not been out many days—issued in Command Paper 1449. Let me say, first of all, that I felt in my heart earlier this year that the very hurried nature of the decision suddenly to send out Ministers to explain the case to our Dominions was very much behindhand, and actually did not fructify at all as an action until there had been very severe complaint from the Dominions themselves. Yet now we read, in the revelations made to us in the last two or three weeks, that in fact the Government have had unofficial consultations going on with the members of the Common Market for about nine months. How is it, then, that we had to be left to these individual rushes of Ministers, whose missions were to be accomplished within two or three weeks, and then the Government try by all means possible to get this Motion through the House before the vacation? Why all the rush like that? How is that, when only a few months ago, after a meeting of Dominion Premiers in London, the matter had not been discussed at all? That seems to be rather extraordinary.

It is in the light of that that I must ask your Lordships to forgive me if I am somewhat suspicious about the guarantees which have been given so far. That is one of the main reasons why I want these references in the Amendment which I am moving and which I think will appeal to different people of quite different Parties, as well as to those of my own. I have looked at these communiqués which have been issued. With regard to the one concerning Canada, Mr. Diefenbaker had, of course, tried two or three times to get a meeting of Ministers. He has not got it yet. There is one paragraph which is particularly interesting, and it is as follows: The Canadian Ministers indicated that their Government's assessment of the situation was different from that put forward by Mr. Sandys. They expressed the grave concern of the Canadian Government about the implications of possible negotiations between Britain and the European Economic Community, and about the political and economic effects which British membership in the European Economic Community would have on Canada and on the Commonwealth as a whole. Mr. Sandys said that before the British Government reached any decision, they would carefully consider the views of the Canadian Government together with those of other Commonwealth Governments".

Now I turn to the statement issued from Canberra, Australia. I do not need to quote at length from this one, because I have already quoted Mr. Menzies himself from the London Times: Australian Ministers pointed out that they thought the ultimate political implications of the Treaty of Rome are extremely significant and will tend to possess a developing character in the achievement of some kind of European unity … However, they emphasised that, although avoidance of a divided Western Europe was a desirable objective, it should not be accomplished at the cost of division within the Commonwealth or elsewhere in the free world. Australian Ministers expressed their concern at the weakening effect they believed this development would have on the Commonwealth relationship". And there is an additional paragraph which says: … but Australian Ministers explained the serious adverse consequences for Australian producers and for the Australian balance of payments which would confront Australia if the United Kingdom were to enter the Common Market on a basis which failed to safeguard Australian interests for the future". It goes on: They further stressed that as in any such negotiations various Australian export industries would be materially involved, Australia should be in a position to negotiate direct on Australia's behalf when details and arrangements affecting items of Australian trade were being discussed". I know that the noble Earl the Foreign Secretary was very pressed for time, but he did not say anything on that point. Is it the intention of the Government during the negotiations, whenever asked by a Prime Minister or a Government of a Dominion, to be associated with a discussion upon his own particular country? Is he to be represented?

THE EARL OF HOME

My Lords, I do not know the exact arrangements which will be made, of course, but I did say that we had told the Commonwealth countries that at all stages of the negotiations the Commonwealth would be kept in full consultation. Perhaps I might add here, about the time of which the noble Viscount was talking before—my noble friend the Lord President will be able to check up on this—that for the last three years, ever since the Free Trade Area proposals were negotiated, I remember discussing these matters continuously with the Commonwealth High Commissioners here. We used to meet for the purpose, and, indeed, every member of every meeting of the Finance Ministers, which now takes place twice a year, discussed this matter, which has always been on the Agenda and has always been discussed in great detail. So there has been a lot of consultation.

VISCOUNT ALEXANDER OF HILLS-BOROUGH

My Lords, I am much obliged, and I shall wait to see exactly how they are treated in these negotiations. But obviously they are very important countries. Canada has her fast-growing population; Australia will be above ten million population now, I suppose, and has a growing manufacturing industry, as well as primary. Surely they should have something to say about it. However, I turn to the communiqué on New Zealand. I have already mentioned the point about the market. What interests me very much is that in this communiqué is the first pledge I saw given by a member of the Government, and it is very specific. Mr. Duncan Sandys made it clear that in the course of any such negotiations the British Government would seek to secure special arrangements to protect the vital interests of New Zealand and other Commonwealth countries and that Britain would not feel able to join the E.E.C. unless such arrangements were secured. There is nothing of that kind in either of the other two communiqués which I have mentioned. I do not know what that means as between the different communiqués. If you take the communiqué in respect to India, the Indian representatives pointed out that the principal exports of India as well as of many other developing countries were subjected to high tariffs, internal taxes and quantitative restrictions of a discriminatory character in some of the countries of the E.E.C., while these products were being admitted duty-free and without restrictions to the United Kingdom. On that they base their case. So far as I can see, no pledge was given in this case by Mr. Thorneycroft, nor was any real pledge given in the case of Pakistan.

The communiqué about Ceylon is almost non-communicative of anything and the communiqués on Ghana, Malaya, Nigeria and Cyprus are without value at all. Our information on these matters has all the way through been strictly limited. If we look at the communiqué with regard to the Federation of Rhodesia and Nyasaland, we see that there is obviously strong feeling there. It says that the Federation's economy is largely dependent on the British market and stresses the grave consequences if Britain were to join the European Common Market without taking steps to protect the Federation's vital interests. Mr. Hare made it clear that the results of any negotiation would be thoroughly discussed with the Governments before any final decision was taken—but gave no pledge. The communiqué on Singapore says very little.

On the West Indies, where we were represented by a Member of this House, the noble Earl. Lord Perth, we have much more information. The noble Earl explained that Britain would not expect to be able to join the Common Market of the European Economic Community without some changes in the present arrangements for Commonwealth goods in the United Kingdom". This is one of the most honest parts of the communiqués that I have come across and I pay full respect to the noble Earl in this connection. The communiqué continues: In this connection he made it clear that in the course of any negotiations the British Government would seek to secure special arrangements to protect these vital interests, and that Britain would not feel able to join the European Economic Community unless such arrangements were secured. So the Member of this House representing us abroad gave a pledge on behalf of the Government. But all the way through, we have been left in this situation of having no information until the Government finally decided to announce, on July 31, that they were going to make application to go into the Common Market.

To-day, for the first time, we are able to get at the Printed Paper Office official information, but there is enough of it to give any Member of the House who is conscientious about studying the conditions steady reading for three whole days. How can noble Lords be expected to be up to date for this debate under these conditions? We pleaded for a White Paper, for more information. I am grateful to the noble Viscount the Leader of the House. I feel in my bones that somehow it must be through his interposition that these documents have arrived and I assure him that they will receive most careful study. But they cannot be effective in this debate. Therefore, we feel that we have a right to be suspicious about the Government's intentions as to how far they are going ahead with this matter with what I would call completely adequate safeguards for the Commonwealth. That is why we have put down this Amendment.

Before I sit down, I must refer briefly to two other things. The first is the position of our agriculture. The noble Earl the Foreign Secretary said that no doubt I should say a word or two about it. I have not much time to deal with this, though certainly I could occupy the length of a full speech on the question. Although we have often praised our farmers, I do not think that we have ever paid a full tribute to what they have done. I do not believe that half the people in this country realise that we are now producing more than 60 per cent. of our total food requirements, excluding, of course, drink and tobacco, and that in the balance of trade this is a very vital factor. And it is not realised that of many of the foods grown in temperate climates we grow much more than our total user. I give the noble Earl the point that if we enter into the agricultural market of the Six, these countries may provide a useful outlet when our own agriculture produces a surplus. But will that be allowed?

The noble Earl said just now that no agricultural scheme has yet been formulated for the Common Market. I have an idea that there is something said about this, but I cannot put my hand on it for the moment. I will look it up and let the noble Earl know. My impression is that nearly twelve months ago a general scheme for agriculture was laid out in a communiqué issued by the Common Market for consideration and that there have been discussions and attempts to get discussions with Dr. Adenauer, in spite of the improbability of getting a final decision before the coming election in West Germany. The rates of duty proposed for the agricultural industry in the draft which I have seen are interesting. The figures of 25, 24 and 20 per cent. are given and if they are the kind of barriers which products from the Commonwealth have to get over, if they are going to be able to maintain themselves on their present standards of living, they are very considerable.

There seems to be a general impression that, if we do go into the European Community, then the present system of support to agriculture goes altogether. I would quote the comment of one of the officials of the Common Market, in which he shows that they could not pos- sibly have our agricultural system. Dr. Mansholt, the Vice-President of the Commission of the European Economic Community, said: Agriculture will have to be included in any agreement by Great Britain and the Economic Community. A common agricultural policy, he said, was one of the essential elements of the Community and this had to be respected. And I noted the words with great care, It was clear, at the same time, that in any agreement providing for the association of Great Britain a different procedure would have to be followed for the agricultural sector from that applied to industrial goods. There was a great difference at present between the agricultural policy of the Six and that of Britain, and the British system would be very ill-fitted for use on the Continent—not because of any inherent weakness in it—but because something like 20 per cent. of the Community's active population was engaged in agriculture as compared with about 5 per cent, in Britain. 'If we were to subsidise our agriculture in the British way', said Dr. Mansholt, 'we should place an intolerable burden on the national budget'. I have had a letter this morning from a gentleman whose name I do not think I can give but I should be very glad to show the letter to the Parliamentary Secretary of the Ministry of Agriculture. He has been commenting on the present position, and how backward some parts of the community of primary producers are, but on the other hand what surpluses are arising. The two surpluses which seem to strike them most at present are butter and, strange to say, beef. In those two commodities you will hit very hard if you are going to be in the position of having a high tariff against them, on the one hand, with New Zealand and/or Denmark, and on the other, Australia on beef. That is the position with regard to agriculture.

I must say I am not at all happy about the statements made so far by Her Majesty's Government with regard to agriculture. Somewhere among my papers I have a statement by the leader of the National Farmers' Union in which he says they could not possibly advise their members to go into the Common Market, according to their present information; and there it is. I hope we may be able to get something before the debate ends, perhaps from the noble and learned Viscount, the Leader of the House, to say what the Government's real intention is and how far they will go with regard to the proper maintenance of the standard of life. I had intended to say a great deal more but I have to remember that many other Members of your Lordships' House want to be able to speak in these two days; therefore I will leave out much of what I was to say.

Of course we want a better standard of life; of course we want at least to maintain the standard of life that we have. But, having heard the view and depression in replies to some of the questions put to the right honourable gentleman the Prime Minister and the at times gloomy forecasts by the noble Earl the Foreign Secretary this afternoon, I wonder how it was ever imagined that there could be put into Election propaganda that the standard of life here and now could be doubled in twenty-five years. Was there at that time confidence in what was being done? What were the arrangements for production and what the direct or improvised plans for industrialists for the maintenance of the economy? Now there is a rush of this kind to deal with this matter, which ultimately is a political issue of the most fundamental importance.

I would just quote one point from the aftermath of the statement of the right honourable gentleman the Prime Minister in the other place the other day—a question by a very old friend of mine, at one time Deputy Chairman of the other place, Mr. Bowles. He said [OFFICIAL REPORT, Commons, Vol. 645 (No. 159), col. 936]: May I ask the Prime Minister to give an undertaking that he will not agree to anything that might prevent a future British Socialist Government from establishing Socialism here? The Prime Minister said: I think that that is the best question I have had so far"— and made no further comment, reminding me of the old writer commenting on Pilate who wrote: 'What is truth?' said jesting Pilate; and would not stay for an answer. That raises a question of fundamental importance when dealing with a political issue and especially in dealing with leaders of industrial trade unions, because it means that unless you protect us in the matter when you come to negotiate with the political side of the European Economic Community there is the question of whether you are to have, under the Treaty of Rome, such arrangements that it would be impossible for a Labour Government here, in face of opposition from the E.E.C., to nationalise the steel industry.

I am hearing, it said in business circles, "Oh, we are in favour of the Common Market", in spite of the fact that they may have to go very lowly when German, Belgian and Luxembourg steel begins to come into the market more easily. Those people say, "We are in favour of the Common Market because you will never be able to nationalise steel here again".

THE LORD PRESIDENT OF THE COUNCIL AND MINISTER FOR SCIENCE (VISCOUNT HAILSHAM)

My Lords, I do not know whether the noble Viscount will think this is a discourtesy, but it is not intended in that sense; but so far as I know there is nothing in the Treaty of Rome which either prevents or encourages public ownership. That is to say, this is a matter which we can discuss among ourselves.

VISCOUNT ALEXANDER OF HILLS-BOROUGH

My Lords, I have studied the Treaty of Rome and I cannot find anything on which I can lay my finger firmly, but now that I have the courtesy of these additional documents from the noble and learned Viscount I will certainly look at it. But that is what is being said in this country to-day, and Her Majesty's Government may be completely misleading leaders of the trade unions and the like if that is not so politically. At least there is sufficient in the Treaty of Rome to show that decisions can be taken if they are unanimous at present and by a majority vote in the future—certainly after 1970, so far as I know. That would very often interfere with items in our economy which would then affect the economy as a whole; and we have never yet been quite in the position of having to take that kind of line with our people, their life and their standards. My Lords, I apologise to the House for having been a little lengthy and only wish I had been able to say a great deal more. I beg to move the Amendment standing in my name.

Amendment moved— Leave out all the words after ("House"), and insert ("notes the decision of Her Majesty's Government to make formal application under Article 237 of the Treaty of Rome in order to initiate negotiations to see if satisfactory arrangements can be made to meet the special interests of the United Kingdom, of the Commonwealth and of the European Free Trade Association; regrets that Her Majesty's Government will be conducting these negotiations from a position of grave economic weakness; and declares that Britain should enter the European Economic Community only if this House gives its approval and if the conditions negotiated are generally acceptable to a Commonwealth Prime Ministers' Conference and accord with our obligations and pledges to other members of the European Free Trade Association.").—(Viscount Alexander of Hillsborough.)

4.8 p.m.

LORD GRANTCHESTER

My Lords, like the noble Viscount who leads the Opposition, I should like to pay tribute to the manner in which the noble Earl, the Foreign Secretary, has moved the Motion before this House. Others, I am sure with more knowledge of agriculture, will deal in detail with the fears expressed by the noble Viscount who leads the Opposition upon which Her Majesty's Government, as I understand, are at present reserving judgment.

Speaking personally and also giving the expressed view of the Liberal Party I can say I should consider it most unfortunate and undesirable that Britain should be separated from the important developments which are taking place on the mainland of Europe. After centuries of conflict these developments may usher in a happier future for some 200 million people who are neighbours. The peoples of Europe, it is true, have attained a high level of individual intelligence, unsurpassed in any age, but, none the less, they have for centuries failed collectively to restrain their internecine conflicts. So, in the decision which Her Majesty's Government have taken, they have our support and our good wishes in the difficult discussions upon which they are embarking. We shall therefore support the Motion moved by the noble Earl the Foreign Secretary.

The great turning points of history are but moments when there have been a special conjunction of circumstances or of personalities, or of both, favourable to change and development. In short, they have been what perhaps I may call miracles of timing. No one, I think, would have dared to prophesy the favourable conjunction of circumstances and personalities in six countries which produced the Treaty of Rome. We hope that a similar and even more startling miracle of timing may bring into being a wider European community.

Whatever may have been the shortcomings of successive British Governments since the end of the war, we have not deserved the strictures which have been levelled against us since the signing of the Treaty of Rome by the Six. In speech after speech from representatives of the Six, in the Council of Europe and elsewhere, we have been accused of seeking the commercial advantages of the Common Market without being willing to shoulder the obligations or to make political commitments. In truth, my Lords, has not the reverse been the case? Immediately after the war, in the Treaty of Dunkirk we gave guarantees to calm the fears of our French friends. Was not that an act of political co-operation and commitment in Europe? We took the lead in formulating the Treaty of Brussels. When E.D.C. was before the European Parliaments, we made commitments which added greatly to the strain on our people, both politically and financially. Although the purpose for which these commitments were made was not achieved, and although because of the holding back of France we did not get the compensating advantages contemplated, we have not withdrawn from the obligations we then assumed. I assert that we need make no excuses. We have not lagged behind in political co-operation. We have worked for common political policies as the basis of European unity. In our obligations for common defence and, in particular, under N.A.T.O., no country has come so near the target set for it as Britain; other European countries have not done so well as Britain.

Personally, as I said some two or three years ago at a meeting of the O.E.E.C. in Paris, I have never been so worried over the commercial aspects of a lack of unity in Europe as over the consequences of a political and cultural division in Europe. Business firms usually find a way—and many British firms have already established themselves within the area of the Common Market—of getting over unnatural divisions which are maintained, even when out of date, for lack of political initiative.

This is perhaps the important question to which we as Liberals ought to address ourselves. Can we, as Liberals, offer any suggestions to Her Majesty's Government which might help them in their task? With respect, I think we can make two, the first on the political side. The Treaty of Rome makes clear the intention of the signatories to build European unity. I should have thought that this implied a merger of sovereignty, even if it is not so expressly stated. But the signatories wisely did not fill in the details. We know that the urge behind was, and is likely to be even more strongly toward a federal form of government. I have never been able to understand why British Governments consider federal constitutions excellent for almost everyone else in the world. They sponsored a federal constitution for Germany after the war, and have sponsored federal constitutions for many developing areas in the world, but they are always worried if any form of federalism is suggested to them. Could Her Majesty's Government visualise the possibility of certain limited powers being exercised by a federal authority in Europe? Could they contemplate that, as confidence is built up between the members of a European Community, there could be a transfer of limited and clearly defined powers to a federal authority, powers over certain aspects of European policy, such as, for instance, the defence of Europe? That is the suggestion which, with respect, I should like to make on the political side.

On the Market side, the commercial side, would not the objections from the Commonwealth, from E.F.T.A., from the developing countries and from G.A.T.T. with which we are confronted be largely resolved if a united Europe emerges with a low common tariff instead of a high common tariff; and if there is also a declaration of intent by Europeans progressively to reduce their common external tariff? This is the solution upon which I should personally concentrate in any negotiations, rather than upon securing a mass of detailed exceptions to the general tariff level. I have found the force of this plea well understood by representatives of the Six when it is put to them, but they have always been able to reply that Britain should set a good example in this matter, for Britain is a high tariff country—a fact which, as a Liberal, I deplore.

There is, I believe, a growing public opinion in the world in favour of the removal of barriers to the free movement of goods and people, not only in limited areas such as Europe, but throughout the world. I hope Her Majesty's Government will give fresh impetus to this movement for wider freedom in the negotiations upon which they are embarking, and I wish them well.

4.20 p.m.

LORD POOLE

My Lords, I have hesitated for some time to intervene in your Lordships' debates, and I do so today only with the greatest diffidence; and I hope that I shall receive the indulgence which your Lordships show so generously to those who speak in your House for the first time. The relationship between this country and the European Economic Community is of such far-reaching importance, not only to this country and to the Commonwealth, but to the whole world, that I thought I might intervene. It is, of course, a controversial matter, and I only hope that I do not trespass too far on your Lordships' indulgence in that direction this afternoon.

It is difficult to discuss, as was mentioned in your Lordships' House on Monday, because of the absence of a White Paper and because most of us, and, certainly myself, like the noble Viscount opposite, have not had time to read all the documents. Moreover—and this, surely, is the fundamental point—only those who are actually negotiating can know all the factors involved. But all of us who have commercial and industrial responsibilities in this country, however slight, have of necessity given the whole of this question most careful thought, not only over the last few weeks and months, but over the last six years. I think it wise, on occasions like this, to make one's own position clear at the start, and I will say at once that I welcome the statement that Her Majesty's Government are making formal application to join the European Economic Community, and I welcome also the reports which we have had this morning of the reception given to the Lord Privy Seal in Paris yesterday.

I am aware, of course—indeed, the noble Earl, the Foreign Secretary, emphasised this when he opened the debate—that this application in itself commits us to nothing, and provides only an opportunity for detailed negotiations. But surely the mere fact of an application must mean, if it means anything at all, that the Government urgently wish to join the Common Market and propose to do so unless, in the course of negotiations, conditions are raised which make it impossible for them to do so. In fact the Prime Minister in another place has said that the risks and dangers of failure are very great. Therefore, it seems reasonable to-day that we should assume that the Government, if they can achieve the means, will enter the Common Market; and I think it is right that we should consider, with what evidence is available, the implications of joining the Common Market.

I am not sure that it is entirely realistic to try to separate completely the political and economic consequences. There are, of course, grave political and economic consequences. But they are so much interlocked, and so dependent on each other, that I think they must be taken as a whole and not used as a sort of trade-off, one against the other: that because our joining would have economic advantages, we should be prepared to pay the price of a political disadvantage. The whole must be taken together. But at least when we consider this problem it will make us do one thing: it will make us face up to the fact that Great Britain to-day is a totally different country, living in a totally different world, than some people seem to imagine—not in any way a worse country, in a worse world, but, in my opinion, a better country in a better world, which is quite different. I believe that reluctance to accept this fact has been the cause of many of our difficulties, not just since 1945 but since 1918; and the decision we have to take now with regard to Europe will make us at least face up to that fact.

It is extremely important—and never more so than at this time, when we anticipate a crisis in Berlin—that the free countries in Europe should be as strong and as united as possible. This is vital, not only to us but to the Commonwealth countries as well; and it is also vital that British influence in Europe should be strong. It seems to me that we cannot best achieve this by excluding ourselves from the councils of Europe; because decisions are affected by representations made while the discussions are going on, and it is extremely difficult to get things changed afterwards. It seems to me that we should be a much more important political Power in Europe if we were there when these decisions were being discussed. I cannot conceive why anybody should think that, because we join in the councils of Europe, we must inevitably be dominated by them. It seems to me quite unrealistic to think that. But of one thing we can be quite sure: whether or not we take part in the discussions on these vital affairs that are going to affect the next 20 or 30 years in Europe and the world, we are going to be vitally affected by them, and it seems much more important to me that we should have our say before the decisions are made, and not after.

Our political influence in Europe and, indeed, in the world cannot be great if our economic position is weak, and that is why I say the two go closely together. We can neither sustain our position as head of the Commonwealth nor be an influence in Europe unless we have a dynamic and expanding economy. For example, I am doubtful whether the sterling area, which is probably the most important material factor that holds the Commonwealth together, would survive another devaluation of the pound. Moreover, the Commonwealth countries look to us for material help as well as leadership.

The noble Viscount opposite, who moved the Amendment, referred to the very great assistance, the loyalty and support we have always had from the Commonwealth countries; and we shall never forget that. But let us also face up to the fact that from time to time they place considerable burdens on us. In the case of India, we have assisted them, I hope successfully, with their exchange difficulties. In Australia, we have understood and have not been unsympathetic when they have found it necessary to impose severe quotas on the imports of British goods to protect their own industry and their exchange position. In Canada, we have watched the problems confronting that country in the last year or so, and we have sympathy with them, even when Mr. Fleming rejects the idea of our joining the Common Market at the same time as the Canadian Government are considering a tariff on British cars.

It is essential that we should consider both sides of all these questions. It is our duty, as the centre of the Commonwealth, to sustain the Commonwealth countries in their difficulties. But we can do so only if we are economically strong enough; and it is no good pretending that they do not add considerably to our burdens. We have, in addition, other serious commitments. It is essential that we assist the progress of under-developed countries, not only in the Commonwealth, but throughout the world. Again, whatever actions we may or may not take in this country, the course of events in the world in the next 40 years of this century is going to be immensely affected by the relations between the so-called rich countries and the under-developed areas. But the more prosperous countries can assist only to the extent of their resources.

There is another important aspect of this matter. It is not only a question of giving aid. Important though that is—and the United States have seen the difficulties and disadvantages that occur solely through that course—we have also to trade with these countries and to build up their trading activities; and this requires a low-cost as well as an expanding economy. Therefore, my Lords, I cannot accept that a prosperous and expanding Europe, with full participation of this country, can be anything but essential, not just favourable, for the Commonwealth countries.

It is certain that if this country joins the Common Market some great changes in our industrial life will be the consequence. The impact of all these changes cannot as yet be discovered, but I do not believe, as some people appear to, that British industry will collapse at the first cold blast of competition. In fact I hold exactly the opposite view. I believe that the fact that this country is one of the most protected countries in the world has greatly militated against growth and efficiency, and I have no doubt that, when the initial difficulties are overcome. British industry, the vast majority of British industry, will be able to deal effectively with competition from Europe or elsewhere.

Also I have no doubt that the stimulus which this competition will give will have a very beneficial effect in certain quarters. Your Lordships will no doubt recall that Dr. Johnson wrote in a letter to Boswell: Depend upon it, Sir, when a man knows he is to be hanged in a fortnight, it concentrates his mind wonderfully. I believe that there are sections of British industry who may well have their minds directed towards increased efficiency at this time.

Another factor which is often overlooked is that most of the problems that are consequential on this country's joining the Common Market would arise anyway. It is quite a wrong conception that in the world we have the choice of going one way or the other. The world is going one way and it is just a question of which manner we go along. The problem is whether we think it better for us to solve this problem alone, or unilaterally, or in conjunction with both the Commonwealth and the Common Market. I think there can be no doubt that going ahead alone can be only a most difficult and unrewarding task. It is inevitable in the present circumstances that the Government should wish to examine every aspect. Each item that effects Commonwealth countries—butter, wheat, mutton, whatever it may be—must be the subject of separate and detailed negotiations. The problems of our colleagues in the E.F.T.A. countries are, of course, a great responsibility. But surely we must face the fact that there can never be a cut-and-dried solution to all our problems, and in fact many difficulties can best be overcome after joining the Community.

The noble Viscount who moved the Amendment referred specifically to agriculture. Agriculture is, of course, one of the great matters, one of the vital matters, that must be resolved. I do not wish to take issue with the noble Viscount but I insist that the problems of agriculture have not yet been resolved among the Six, and I am led to believe that the German farmer is showing that he has very little to learn from his opposite number in the National Farmers' Union here; and German agriculture is still a highly protected industry. I should have thought it would be better and more satisfactory that we should influence these decisions before they are taken, rather than try to change them afterwards, and use them as a sort of bargain over the entrance fee to a club.

My Lords, I am very doubtful whether the Government have unlimited time to settle these negotiations. One thing is quite certain: the political difficulties at home will be greater as the opposition becomes louder, and in certain quarters more irresponsible. Delay will make these problems more difficult and not easier to settle, and I believe that a decision on this matter will have to be taken within the next twelve months. I apologise for making so many controversial and dogmatic statements. I said that it was impossible not to be controversial, and it is difficult to make points in a short time without being dogmatic. But I am very grateful to your Lordships.

4.35 p.m.

LORD BRAND

My Lords, I think you would all wish me to congratulate the noble Lord, Lord Poole, on his speech. I have seldom listened to a speech with more "meat" in it, I thought we should hear a very good speech from him, because I had the advantage of his presence on the board of my firm for a good many years. I have now resigned, and I think he has too, though of that I am not sure. But he is, in my opinion, full of knowledge and wisdom, and I am very glad that we have him in this House.

I wish to add only a few rather perfunctory remarks more or less to what he has said. I venture to address your Lordships because I have known the British Commonwealth very well for many years. I am the only surviving member of a group that helped to federate South Africa and founded the Round Table Magazine in this country, which has lasted now for over fifty years and has constantly advocated the interests of the Commonwealth. Therefore your Lordships may take it that I have that side of affairs very well in mind; but the whole tendency of the times has been against the federation of the Commonwealth. I remember in the early days my friend Mr. Lionel Curtis suggesting that possibly the problem of a Commonwealth Government could be overcome by having a communal Cabinet sailing round the Commonwealth in a "Ship of State" and taking their decisions—even before radio and the telegram existed—as they reached each port. But that idea never came to fruition. Now the whole tendency of the British Commonwealth is in the opposite direction, and we have to recognise what it really is to-day.

India is still in the Commonwealth but probably would not be of very great assistance to us in a European war. Probably she could not be. India, as a member of the Commonwealth, looks to us for money. She wants money; she must get huge sums of money from somewhere. She would like to get them from the Commonwealth, but unfortunately we have no money to give them. We have a large adverse balance of payments, and anything we can give her we must borrow from somewhere else. Then there are the African States. What part they are going to play in the Commonwealth nobody knows. They all want money. What is Mr. Nkrumah going to do in the Commonwealth? Mr. Nyerere, of Tanganyika, is very unhappy because he could not get from the British Government quite what he hoped to get. But we have not the money to give them. At present—until the Welfare State manages to secure not to have an adverse balance of payments—we can give them money only by borrowing money elsewhere.

All these countries look for very large monetary help, and they will inevitably turn to the countries which are able to give it—whether it is the United States, Europe or Russia. We have in our time given thousands of millions of pounds to the Commonwealth, but at present we are unable to do so. Let us hope we can do so as soon as we have learned to create a favourable balance of payments. No doubt we have many friends in India and in Africa, but mere friendship will not be enough to keep them close to us unless we can help them. South Africa meanwhile has left the Commonwealth, and what is really left of the Commonwealth is Canada, Australia and New Zealand. All these countries would like to remain allied to us, would like us to help them, and in turn they would like to help us. The noble Viscount, Lord Alexander of Hillsborough, said how grand was the help those countries gave us in two wars and we can never forget that. Canada, of course, is better off for money than Australia or New Zealand because she is tied in with the United States. The great trouble is that she has to borrow too much; she gets too much American money and would like some from us.

Those three countries belong to the Western European world but they face the Asiatic world. Australia has nearly 15 million people; New Zealand about 2½ million. China, nearby, has 600 million and Indonesia 80 million, not forgetting behind them 200 million Russians. Those countries must look to others as well as ourselves for help if help is needed. They will naturally look to us for protection, but that alone will not be enough. They are bound also to look to the United States, and we must remember that the United States strongly wishes the European world to unite more closely so that a United States of America and a United States of Europe, including the United Kingdom, may be powerful enough to protect themselves and their friends against the Communist Powers, whose strength is likely to grow rapidly. We must not suppose we shall maintain our old relationship with the United States if our 50 million are separated from the whole of Europe and do not compare in strength with the 170 million of the Continent. It is because we must work together to be strong that I am in favour of joining the Common Market. Of course we must protect Australia, Canada and New Zealand so far as trade is concerned. Of course also we must protect the British farmer. I have been a farmer for 40 years and I certainly want protection if a great change comes about. The noble Lord, Lord Netherthorpe, will no doubt know how to give it to me.

We cannot say now how far politically as well as commercially we shall be led by the Common Market if we join it. I agree with the noble Lord, Lord Poole, that politics and commerce cannot be really divided. There are ardent advocates in the Common Market, some of whom I know, who wish to increase the political unity in Europe and to take steps which will diminish the sovereignty of each State and increase the sovereignty of the central State. That may happen, but I think it will take a long time. We could, I think, go a long way not only by free trade but by financial measures in supporting one another in Europe.

I believe that financially it would be possible to found a European central bank which might help the European countries, including ourselves, a great deal; but of course each country must pay its way and cannot live on the central bank. We are not paying our way at this moment. I believe the future will show us that to join the Common Market is necessary. For one thing, though this may seem an odd argument to use, it would prevent the Germans, if ever they wanted to, from joining Russia. Possibly if left to themselves the Germans might at some critical moment in history join the Russians, and that would be disastrous. Commercially and industrially I consider we have a very great deal to gain. It is no doubt a tremendous step. Nevertheless we ought to remember that the Scots and the Welsh thought it a tremendous step when they joined England, and it may turn out not to be so much worse than that.

4.48 p.m.

LORD GLADWYN

My Lords, I believe you will think it natural that my friends of the Common Market campaign and I should welcome whole-heartedly the decision of Her Majesty's Government to apply for membership of the European Economic Community, because, after all, this action is in entire accord with what was suggested in our Declaration on Europe published on May 25 last. As some of your Lordships may also be aware, I myself have had a Motion down on the Order Paper here for many weeks which reads as follows: To call the attention of Her Majesty's Government to the desirability of their consulting with the Commonwealth and with the European Free Trade Association as to the terms on which this country could join the European Economic Community … as a prelude to negotiating the necessary derogations from the Treaty of Rome; and to move for Papers. This Motion I now have the greatest pleasure in withdrawing!

It will no doubt further be within your Lordships' recollection that in my last two interventions in your Lordships' House I enlarged on the political and economic reasons which, as it seemed to me, made it absolutely imperative for this country to negotiate its entry into the E.E.C. on the basis of an acceptance by us of the principle of a common external tariff and of the institutions and political implications of the Treaty of Rome. As I see it, the Government have now explicitly accepted the principle of a common external tariff, though they rightly insist that, unless this can be somehow reconciled with the basic long-term interests of our Commonwealth and E.F.T.A. colleagues, and of course British agriculture, they will not be able to sign the Treaty.

What remained implicit, I think, until this afternoon was their broad acceptance of the institutions and political implications of the Treaty: implicit because, after all, if you apply to join a club you normally duo not suggest that the rules and the committee and the club should be radically changed. You join it because you see advantage in joining it. Until we heard the Foreign Secretary this afternoon it was not certain, I think, Whether Her Majesty's Government would, broadly speaking, accept the Treaty of Rome as it stands, and merely attempt to negotiate the essential economic protocols, or whether they would seek to revise the Treaty of Rome itself.

From what the noble Earl said in his admirable speech, one thing stood out to my mind. All his remarks were, in my opinion, admirable, but I thought that one thing stood out—namely, that there was no doubt that if we entered the European Economic Community (it is true in a restricted economic sphere) there would be certain derogations from the strict letter of what is called our sovereignty, and that this was a fact which the Government were prepared to accept, in view, of course, of the great prospective benefits which would be obtained from coming into the Community.

With your Lordships' permission, I should like to devote almost the whole of my speech to-day to the so-called political implications of the Treaty, because they are really quite important. I am encouraged to do so all the more because I observed on reading my Hansard yesterday that there was an interesting exchange of views of this subject between the noble Earl, Lord Swinton, and the noble Earl, the Foreign Secretary, during a discussion on the Prime Minister's statement of July 31. As a matter of fact, I did not know that the noble Earl, Lord Swinton, was going to refer to me by name—otherwise, naturally, I should have done my best to be in my place.

THE EARL OF SWINTON

My Lords, I did not know, until I heard it, that there was going to be a statement.

LORD GLADWYN

I am sorry. I do not wish to say anything that I should not say, only that I should have liked to be present. All the more should I have liked to be present since, with the greatest possible respect, the account of my views which was given by the noble Earl was, I am afraid, rather a travesty of what I have written and said. I know that the noble Earl was attempting to summarise an attitude which it is admittedly difficult to summarise. But I must say that I was astounded to have attributed to me the view that—and I now quote [OFFICIAL, REPORT, Vol. 234 (No. 118), col. 32): the Treaty of Rome obliges us, whether the parties to the Treaty want it or not, to enforce upon anybody who enters the Treaty the most complete abdication of sovereignty. This was contrasted, I think you will see on reading the Record, with the comforting view of my noble friend the Foreign Secretary, which, we were led to infer, was that any Treaty was to some extent a derogation of sovereignty; that the Treaty of Rome was, after all, just another Treaty; and that therefore there was no reason for us to be frightened or to regard our eventual signature of the Treaty as anything out of the ordinary. Subsequently, the noble Earl the Foreign Secretary said that he did not think that there was necessarily a difference of opinion between himself and myself; and, after his magnificent speech this afternoon may I assure him straight away that I do not think there is.

But obviously there is great confusion about the political obligations which we should assume if we sign the Treaty of Rome. I hope your Lordships will agree that at any rate I have consistently tried to clear it up to the best of my power. In my speech in this House on June 21 last, for instance, I analysed these political issues, and I suggested that we might not find them quite so frightening as some people thought. I have also expressed the same views at much greater length in articles in the Press, some of which, I regret to say, have been twisted and quoted out of context. All these efforts of mine have had as their text one single basic theme—namely, that, although on becoming a full member of the Community we should—and here I quote from my speech in this House on June 21 [OFFICIAL REPORT, Vol. 232 (No. 96), col. 646]: have accepted a binding and, so to speak, an organic commitment wider than, and different in kind from, our commitments under our existing Treaties, far-reaching as some of those undoubtedly are", this would be a commitment precisely limited in scope, which could not be developed into anything like a Federation except with this Parliament's own consent.

My Lords, I should of course welcome some authoritative support for what I would call this doctrine by the Lord Chancellor, and I hope that the noble Earl the Foreign Secretary (who would clearly subscribe to it himself), will have no further reason to be apprehensive of the view of the highest legal authority, as he seemed to be to some slight degree in his speech. But I do not think, subject to what the Lord Chancellor may say, that the broad judgment which I have just made can be seriously disputed by any instructed person who reads the Treaty of Rome attentively.

Let us take the various institutions. Here, may I say at once that I think we must accept them as they are if the forthcoming negotiations are going to succeed at all. No amount of arguing that the French word "adaptations" which occurs in Article 237 and is translated as "amendments" in the English version, justifies our demanding major changes, will do any good. What the word probably means is, I think, something like "necessary consequential changes", and certainly these will have to be made.

LORD KILLEARN

Why should it not mean adaptations?

LORD GLADWYN

No, my Lords, I really think it should be rendered as "necessary consequential changes". Some of these, for instance those concerning the various voting formulæ and, more especially, the voting formula in Article 148 which governs the voting procedure in the Council of Ministers, will be of the greatest importance. But the attempt to secure major changes in the Treaty itself would not only give rise to an interminable debate: it would also be pointless. After the appalling difficulties which they had on agreeing to them, it stands to reason that the Six cannot modify the existing institutions, and that if we join we shall have to accept them substantially as they are—I assume, after what has been said this afternoon, that we are going to.

So let us for a moment examine these institutions in detail from the point of view of what some people call "derogations from sovereignty", but which I should like to call restrictions on our entire freedom of action in the economic field. First of all, we have the Commission. This consists of a number of civil servants sitting in Brussels and seconded from their national Governments for a period of time. Their task is to prepare plans for bringing into effect the various chapters of the Treaty of Rome which look forward to the formation of the Community. The Commission, of course, cannot overrule any individual member. It is subordinate to its political chiefs sitting in the Council of Ministers. Of course it has to be admitted that it may represent the potential International Civil Service of the future. After all, the Treaty does set up an Economic Community. But—and I think this is an essential point—we could only get to the stage at which a potential International Civil Service would be at the orders of some International Authority of a comprehensive nature, when and if this country of her own volition—I repeat "of her own volition"—has agreed to such an international government being set up.

For instance, the Parliament laid down by the Treaty can be established only when all members have agreed that it should be established. In the meantime, it is a purely advisory body. Therefore there will not be any Federation, or indeed, for that matter, any Confederation, under the Treaty until at any rate we have come to the end of the traditional period, which may be as late as 1972, and even after that, not without our formal consent.

A third institution is the International Court. Here we should, even during the transitional period, I believe, be obliged to refer to the court disputes relating to the interpretation of the Treaty or to allegations that a member was not carrying out his obligations under it. I do not think this ought to worry us. After all (and the noble and learned Viscount the Lord Chancellor will correct me if I am wrong) I think we have already agreed to limit our sovereignty in this respect by subscribing to what is called the Optional Clause of the Statute of the Supreme Court at The Hague.

But, my Lords, there remains the Council of Ministers. And here it simply cannot be denied that if we became members of the E.E.C. we should have to agree that the Common External Tariff, once established, could be changed only by a majority vote in that body: and the same would apply, of course, to any measures designed to restrict the flow of trade. Nor could we prevent the Common External Tariff from being set up within the timetable fixed by the Treaty. We should have a veto on acceleration; we could insist, if necessary (although it is to be hoped that we should not), on the optional delays; but that would be all.

It is quite true that we might be able to achieve a majority in favour of changes—and, of course, much would depend on the voting formula to which I have referred. But, again, we might not; and if we did not, then, whatever the pressures inside this country on the Government might be in 1972, or whenever the Common External Tariff finally comes into operation, we should have to accept in the last resort some majority verdict which might, after all, have considerable consequences to the economy of this nation. But we must always remember, even so, that the Treaty provides far special facilities for those members who may in balance-of-payments difficulties, or who are suffering from some other forms of economic distress.

Even during the transitional period there are certain additional matters which could, if necessary, be decided by a majority vote, but I do not think these need bother us unduly. The essential thing is for us to accept the principle of majority voting in the Council—in a certain restricted sphere, it is true, but nevertheless the principle of majority vot- ing. With great respect, this is a principle which, with one perhaps rather minor exception, we have, I believe, never accepted before—though I speak subject to correction. N.A.T.O., S.E.A.T.O., C.E.N.T.O., O.E.E.C. and the Council of Europe are all run on the principle of unanimity. I am not quite certain about G.A.T.T., to which the Foreign Secretary referred, but I believe I am right in saying that it is not absolutely obligatory on us to accept the decisions of G.A.T.T. from the legal point of view. Even in the United Nations, the resolutions of whose Assembly have no juridical validity, as a permanent member of the Security Council we can rely, if necessary, on the Veto.

The only real exception, I think, to the unanimity rule which we have so far accepted is in W.E.U. Here we undertook, as doubtless noble Lords are all aware, not to diminish the strength of our forces in Germany without the consent of a majority in the W.E.U. Council of Ministers. However, this obligation, though binding, is subject to important qualifications, notably as regards our own finances and as regards the defence of our overseas possessions. Our economic obligations under the Treaty of Rome would clearly be of a far greater order of importance even than these.

I now turn to the various chapters of the Treaty. The Customs Union, of course, comes first—that is the basis of the whole thing—and after that we have chapters on agriculture, the free movement of persons, services and capital, transport, rules governing competition, fiscal provisions, approximations of laws, balance of payments, commercial policy, social policy, an investment bank and the association of overseas countries and territories. All these together constitute over one-third of the huge volume containing the Treaty. The final half of this enormous work consists, for the most part, of special Protocols relating chiefly to the individual interests of members. But the various chapters on the things I have read out come to one-third. With the exception of the last two on the list which I have read out, I think these chapters may really be described as objectives. They lay down very sensible rules about how the Community might be gradually established in these various spheres. But, my Lords, how far they will actually be achieved is anybody's guess. It depends primarily, it seems to me, on what degree of confidence there is. Besides, there are, as we all know, two broad schools of thought among the Six themselves (and there would be among the Seven if we came in); namely, those who wish to proceed quickly towards an actual Federation and others, including, I think, at least one powerful Government, who are not now prepared to move towards any form of Federation at all.

Always on the subject of these "objectives", what I should like to say is this. So long as nation States are nation States, there will always be practical limits beyond which no great power can be dragooned against its will. In particular, it really is not to be imagined, at any rate during the transitional period (which, as I have said, may well go on until 1972), that any major member of the E.E.C. is going to have severe local unemployment forced on it against its will as the result of some majority vote. Nor would it, in practice, be forced against its will to agree to any large influx of foreign labour.

All these problems would, of course, be threshed out first in the Commission and then in the Council in Ministers. All that is essential, unless the whole idea of a Community is to fade out, is that all the nations concerned should loyally accept the disciplines imposed by the Common External Tariff. Because, my Lords, unless we do voluntarily accept these disciplines, what are these negotiations going to be about? How is the Common Market, now an established fact the other side of the Channel, going to be enlarged so as to include ourselves and others? What inducement would the Six have to let us into their "club" at all, to say nothing of granting us those important economic derogations which we hope to secure and without which, naturally, we say we shall be unable to sign the Treaty? They would have none.

And so I repeat that if we go into the negotiations, as I trust we shall, it must be with our eyes open on these essential points. By all means let us agree—and here again, I think, I am at one with my noble friend the Foreign Secretary—that many of the practical limitations on our complete freedom of action might be worked out by common agreement over the years. But do not let us delude ourselves about the nature of the essential disciplines which we should voluntarily agree to abide by.

My Lords, I cannot, however, see that if we enter into this kind of Community our own great and ancient institutions, of which we are so proud, could be anything but strengthened. To assert, for instance, that the Monarchy would be imperilled touches, to my mind, the very depths of imbecility. The opposition to our going into Europe always asserts that entry into the Common Market—and this was a point made by the noble Lord, Lord Poole, in his excellent speech—would in some way involve dictation to us on the part of foreigners. The fact is that if we did come in it would be we who would be dictating to the foreigners, just as much as they would be dictating to us.

There is no doubt, to my mind, that if we did eventually sign the Treaty of Rome, on satisfactory terms, we should be, as a nation, in a far stronger position than we are now. By and large, the authority and influence of this Parliament would be increased rather than diminished. Nor have I any doubt that, always if we achieve satisfaction as regards the trade of the Commonwealth, that unique body, with a Europe united economically behind it, could play a rôle the importance of which can hardly be imagined in the present state of affairs. But in order to achieve all this we must, I repeat, be prepared to accept certain rules, without which European unity cannot in fact be achieved. This may well require a great change in our ingrained habits of thought, and to accomplish it there must be an inspired effort of leadership which I have no doubt at all the Government will provide. If I may venture to say so, the Foreign Secretary gave proof of it to-day.

Lastly, may I say that I have not raised all these awkward questions about the interpretation of a complicated Treaty with any idea of being difficult, still less of prejudicing the success of a venture which, as your Lordships know, I have always had so much at heart. We must, I think, recognise that if I did not raise them somebody else undoubtedly would, if not here then on the other side of the Channel. What effect would it have over there if we gave the impression that we were not one with them in a sincere desire to establish an even wider European Economic Community? I know, of course, that anything one says on the subject may, and no doubt will, be twisted to show that, by signing, we should transform ourselves into a province of the Empire of some new Charlemagne. But I believe that such apprehensions are ludicrous. I believe that the kind of European Confederation to which we, together with that great leader, General de Gaulle, may legitimately aspire (and which, incidentally, is much more likely to come about if we do join than if we do not) is something which would in no way involve our country in any diminutio capitis, as the Romans said, but rather would raise it to new heights regards its influence and standing in the world.

My Lords, I believe that the formation of a united Europe, or at any rate a united Western Europe, is the one sure way to arrive at that ultimate construction of our dreams of an Atlantic Community—some association of Europe and America which, in conjunction with the Commonwealth, would form a real pole of attraction for the entire free world. I believe, further, that it is the only sure way to counter the advance of what the Prime Minister so rightly referred to on Monday last as "the enormous monolithic strength of the Soviet power." I consequently hope and believe that July 31, 1961, will go down as one of the most momentous dates in our country's long history, and I hope that the great majority of your Lordships will be found to support the Government in the bold and imaginative decision which they have taken.

5.10 p.m.

THE EARL OF LONGFORD

My Lords, I know the House has listened with especial attention to the noble Lord, Lord Gladwyn, Who is so great an expert on the subject under discussion. I suppose I should declare, if not an interest, at any rate a kind of allegiance to him, as I am one of the signatories to his European Manifesto, but that agreeable but localised allegiance does not, of course, interfere with my more profound and organic allegiance to my colleagues here, and particularly to the noble Viscount, Lord Alexander of Hillsborough. Indeed, I might offer my services to the Government when they try to reconcile allegiance to the Commonwealth and to Europe. Those much more experienced in these matters suggest that the obstacles are much less than commonly supposed.

I should like to congratulate the noble Lord, Lord Poole, on his speech. I feel that, under the strain of speaking, he has left the Chamber; but at any rate it is my pleasant duty to congratulate him on an outstanding maiden speech. He comes to us, of course, with a record of service in war and of achievement in the Conservative Central Office. I am not quite sure what he did there, but it was understood that he was collaborating with the noble Viscount, Lord Hailsham—who is perhaps reviving him, I do not know, after his oration. The exact distribution of function was never made clear, but, if I remember rightly, one was to do the thinking and the other was to do the talking. Again, it is not absolutely clear which it was did which, but anyone who could keep up with the noble Viscount the Leader of the House in either department obviously would be a great acquisition here, and Lord Poole has certainly proved that this afternoon.

I myself wish to speak as candidly as compatible with the ordinary rules of conformity. At the end, perhaps noble Lords will say, in the way expressed by the Irish: "Mind you, he said nothing". But I will try to speak as candidly as possible and say at once that I wholeheartedly welcome the approach that the Government is making to the six countries of Western Europe, with a view to negotiating with them and joining their number. I must say, to be candid, that I could have wished that, in our own Amendment, we had made that welcome a shade more explicit; but I have perhaps said enough to make my own views plain, and I am only going to say that those issues must be worked out with one's own conscience, and with the Party Whips and other high functionaries. I have indicated where my conviction lies.

We are told in all the papers, and we have been told more than once in this House, that this is an epoch-making decision—one of the greatest. Some people have gone so far as to say it is the greatest, but I think that is an exaggeration, perhaps, because the decision so far taken, at any rate, does not carry us very far. But we are confronted by a total decision which is certainly one of the greatest we have ever taken in peace-time. I was very much interested by what the noble Lord, Lord Strang, said the other day. I am quoting from memory, but he said, in effect, that the obligations that we are now being asked to assume are different in kind (I am glad to see I have the noble Lord's assent) from those assumed hitherto. But those who have read, as I did with much pleasure, the noble Lord's classical History of British Foreign Policy will find that we have often taken decisions which were different in kind, or seemed so at the time.

Those of your Lordships who refer to page 249 of Lord Strang's book will find a quotation from the famous memorandum of the Prime Minister, Lord Salisbury, who of course was the grandfather of the noble Marquess. The question then was whether we should depart from our traditional isolation. It was long before the complicated question of sovereignty, and derogating from it in the modern sense, arose. Lord Strang quotes Lord Salisbury to this effect in 1901. He wrote: Except during Napoleon I's reign we have never been in danger, and, therefore, it is impossible for us to judge whether the 'isolation' under which we are supposed to suffer, does or does not contain in it any element of peril. It would hardly be wise to incur novel and most onerous obligations, in order to guard against a danger in whose existence we have no historical reason for believing. That was, of course, 60 years ago, and I think the noble Lord, Lord Strang, and other experts, would agree that during this century we have seen a steady departure from our traditional isolation. I need not run through the various stages and moves, but if we are being confronted to-day with a decision which is different in kind, it is surely the logical outcome of a process of evolution which has been worked out by the various Governments which have been ruling in this country for the last 60 years.

LORD STRANG

My Lords, could I remind the noble Lord that there were people who thought at the time, and there are people who think now, that we made a mistake in 1904; that Lord Salisbury was right and that Lord Lansdowne was wrong. Lord Rosebery thought at the time that the Anglo-French Entente would lead straight to war, and people now say that it did. Therefore, it may well be that there are people now who think that this step is a mistake, and it may well be in future they will think the same.

THE EARL OF LONGFORD

My Lords, I should think it very odd if nobody opposed so far-reaching a measure, and very odd after the event if nobody thought it was a mistake. But surely the noble Lord, Lord Strang, and other noble Lords as a whole, would not say that the Anglo-French Entente led straight to the war of 1914. Perhaps I should not pursue it too far.

LORD STRANG

My Lords, I was not expressing that opinion at all; I was merely saying people had thought so.

THE EARL OF LONGFORD

My Lords, there is always room for eccentrics, and I hope there always will be room for them in this country.

There are, as was made plain in the very able speech (which goes without saying) of the noble Earl, Lord Home, two decisions, in effect, to take. There is the one decision, with which we are confronted to-day, the decision whether to negotiate; and then there is the second decision whether actually to go in. To-day, as we are all quite clear, there is just the first decision; the second decision will, of course, come later.

When we are confronting this first decision, I would, simply in a sentence or two, indicate my own attitude, which is not a unique one. If I may return to the phrase I used just now, it is not an eccentric one, but is held very widely in the Labour Party and in other Parties. Whether it is a majority opinion it is not for me to say. I would describe myself as a 100 per cent. supporter of the idea of Britain joining the Common Market. But even I, and the others who think like me, would not suggest that the Government, in advance of the negotiations, should express their readiness to join the Common Market at any price, even if no concessions whatever were made. I am very glad to think the noble Viscount, Lord Chandos, is going to speak to-morrow, and I hope he will speak in this same sense. He is someone whom I would perhaps regard as a "super-eminent authority" on negotiation, and I am sure he, and all others concerned with negotiation, whether in business or diplomacy, would say that one cannot take up the position that one would go in at any price, any more than a person buying a house would say that, whatever price the vendor put on it, he would buy it. Obviously, there are limits to the enthusiasm even of the strongest supporters of the Common Market.

As I said earlier, I wish that our Amendment could have made that attitude somewhat plainer, but I can well understand the difficulties of the Party leaders, and I am not criticising them. I would emphasise, however, that I certainly am not suggesting that we should have refrained from a critical Amendment at all. I agree, for example, with the Guardian, which in a leading article yesterday treated the statement of the Prime Minister as a tepid one, though I do not think that they used that word. For tactical reasons, it might have been clever to be tepid. But I echo any criticism of that sort.

More fundamentally, and coming closer to our own Amendment, I would say that the Government's record with regard to Europe in their ten years of office is wretched. That has been brought out in various striking ways by my noble Leader, with some remarkable quotations. I do not think that anyone can claim that there is any advantage to be gained from negotiations now which could not have been obtained, with fewer risks and greater safeguards, three or four years ago. No one would say that any benefit has come to this country with the delay. I do not think that anyone would have the audacity to put that view forward. And nobody would blame the Labour Party, saying that in some mysterious way we had delayed proceedings. The Government must fairly and squarely take the blame for that.

We must consider our obligations to E.F.T.A., which have grown up in that period, along with our more deep-rooted obligations to the Commonwealth and to our agriculture. The whole establishment of E.F.T.A. has proved to be a cul de sac. The whole idea has proved to be a "washout". The Government are doing the right thing now, but in the sense that the prodigal did the right thing in returning home, announcing that he had sinned before Heaven. His bargaining position on his return is generally recognised as having been extremely weak. He was lucky enough to get away with it, but he had a compassionate father. With all the virtues we attribute to Dr. Adenauer and others, I do not think that we can assume that depth of Christian charity. But there it is. The Government come out very badly in any dispassionate discussion of their record in this matter.

I would certainly join my colleagues and follow my noble Leader in refusing to congratulate the Government—indeed, in censuring them to the best of my ability—in regard to their handling of our economic affairs, do not want to run over the ground of our recent debate, even though, as my own small act of national sacrifice. I refrained from speaking. But I would take one sentence, which comes from an admirable pamphlet called, Britain and the Common Market, which has been issued by the great Conservative paper, the Daily Telegraph. May I say, in parenthesis, as many of us from time to time criticise the Press very sharply, that the Press have done a wonderful job in regard to this whole subject. If we are not educated about it, it is not the fault of the Press of this country. I quote from the Daily Telegraph, which, as I need not remind your Lordships, is a strong Conservative paper: One new factor is said to enter the Government's mind. The poor state of our national economy. Flabby and uncompetitive. We are rapidly pricing ourselves out of this world"— I do not know what we are pricing ourselves into— The drastic action is overdue. It may take the form of joining Europe. If that is our position after ten years of Conservative rule, I am glad to join in any kind of censure of those who have been administering our affairs.

I should like to deal with only one other point before I sit down; and if, in doing so, I seem to differ from the noble Earl, Lord Attlee, it is in the spirit of a pupil who cannot resist the conclusion that his master has checked his thinking at a certain point—I hope, of course, only for the time being. We hear a great deal of talk about the interference with our sovereignty, about the reduction of our sovereignty, if this goes through. The noble Lord, Lord Gladwyn, explained that with extraordinary clarity this afternoon. I cannot imagine any Socialist—and I learned such Socialism as I possess from the noble Earl, Lord Attlee, if I learned it from anyone—whose ideal does not involve a major interference with our own national sovereignty, a major reduction in our national sovereignty, and along with that, of course, a major interference with, and a major reduction in, the national sovereignty of every other country in the world. That is what I have always understood to be the position of international Socialism; and Socialism which was not international would be a very limited conception.

Certainly world government as an aspiration involves a much greater reduction of sovereignty than anything we are discussing today, and when I talk of a reduction of sovereignty, I bear in mind what was brought out, for example, by the noble Earl, Lord Home; that when we reduce our own power of independent action we assume a share in a wider international sovereignty. He gave as an example, the bachelor as compared with the married man.

EARL ATTLEE

My Lords, I think that the noble Lord will realise that there is a difference between surrendering sovereignty to a world body and surrendering sovereignty to a group of Powers.

THE EARL OF LONGFORD

My Lords, I appreciate that; but may I say, with great humility, that we must make a start somewhere.

EARL ATTLEE

Not a wrong start.

THE EARL OF LONGFORD

My Lords, I cannot resist breaking off to tell a story. Yesterday I bought a newspaper to find out what had happened in the Test Match. At that time, we were 100 for 1, with Dexter still going strong. I asked the newspaper man what was happening. He said, "Oh, he has slammed them all over the place." I thought he meant Dexter, but the heading was, "Attlee Slams Common Market". The noble Earl had driven the Test Match off the front page altogether. However, that is by the way. I have no doubt that the noble Earl, who is a masterly debater, will dispose of me very readily when he speaks to-morrow.

World government is accepted to-day as the official aim of the Labour Party, and no one has done so much, or half so much, as the noble Earl, Lord Attlee, to bring that about. Some of us have been pressing, in this House and elsewhere, for a positive lead from the British Commonwealth in the direction of world government. Once again, I endorse everything that the noble Earl, Lord Attlee, said on that subject, which he said with especial force in our last Foreign Affairs debate. But the truth is that Soviet Russia is sabotaging progress towards even so limited an institution as a small International Police Force. I cannot accept, with respect to the Government, that the opposition is anything like so complete as they make out, and I believe that far more progress towards world government could be made through that medium than they are ready to admit. Here, in Western Europe, it is possible to make progress towards a general international system in a field where the Communists cannot block us and in partnership with other Christian nations.

I do not want to alarm anybody. If anybody was to be alarmed, it would be by what was said by the noble Lord, Lord Gladwyn, who spoke with candour about the dangers and difficulties of the Common Market. But as the noble Lord, Lord Gladwyn, has explained—and I believe he made that point to-day as well as in our last discussion—the Common Market cannot be turned into a Federation without the consent of everybody including ourselves. So I am not afraid that if we go into the Common Market we shall find ourselves in world government before we know where we are. But, looking beyond that, I cannot understand how anybody can seriously believe in world government as an objective to be realised in our lifetime and at the same time fail to show genuine enthusiasm for any British lead towards a united Europe.

It goes without saying that we must scrupulously honour our obligations to the Commonwealth family, but there is no difficulty in principle there. We read in the Press to-day, and the noble Earl, Lord Home, has explained authoritatively, that the six representatives of Western European Union confirmed to the Lord Privy Seal yesterday that they attributed the greatest importance to the British links with the Commonwealth; and that must have been a most encouraging response to the visit of the Lord Privy Seal. The leaders of Western Europe made plain that in their view it would be contrary to the interests of the Free World to weaken those links.

Obviously there is going to be a great deal of hard bargaining, but in the light of that European reaction to the statement of the right honourable gentleman the Prime Minister it is surely inconceivable that an honourable settlement should not be available if only we maintain throughout the negotiations a genuine vision and a generosity and largeness of mind. It is not for me, in these few observations, to argue against old-fashioned isolationists of Conservative temper—and I hope I am not insulting anybody by implying that such people still exist—but I will, if I may, reserve my last few sentences for my own political friends. It seems to me that any Socialist to-day, and particularly any democratic Socialist (and certainly no other kind of Socialist is wanted in the Labour Party) must face the fact that social democracy at the moment in the world is a minority cause; and, whatever may lie ahead, it is likely to remain a minority cause in the leading countries for some little while yet. I hope it will not remain a minority cause in this country for very much longer and we may well hope that it will be a majority cause here fairly soon. But, taking the world picture, we must admit that it will be a minority cause in the world for a little while ahead.

This country has, at the present time, in spite of having had ten years of Conservative Government, the most effective Socialist democratic Party in the world. Either we in the Labour Party cast our influence in favour of a national policy which would more and more pool our sovereignty, or we are so reactionary, we fear the foreigner so much, that we draw in our skirts and preach to ourselves in Hyde Park without any noticeable influence on world affairs. I believe Britain to-day is presented with an opportunity which, properly handled, will bring us more influence than we have ever possessed in the past, an influence for still wider and nobler causes than we have ever served. But if we fail to take this chance, which is unlikely to recur for many years, we shall be condemned, and rightly condemned, for timidity and indecision, by generations not yet born.

The primary burden lies on the Government of the day. I shall be happy to join in censuring them for many things, but an Opposition like ours, which hopes to succeed them at no distant date, cannot escape its share of the heavy but glorious responsibility of being confronted with a wonderful chance of taking a great step forward to a saner and more Christian world.

5.35 p.m.

THE EARL OF BESSBOROUGH

My Lords, I am sure we are all grateful to have heard the words of the noble Earl, Lord Longford, who so warmly supports the policy of Her Majesty's Government, even if in some respects he has reservations; but I rise this afternoon to support the Government most strongly in deciding to apply for membership of the European Economic Community. Ever since the creation of the Council for Europe in 1949 I have hoped, for geographic and economic reasons, that we should ultimately try to become members of such an organisation, but I have never minimised the problems so far as the Commonwealth and our own agriculturalists are concerned. But there is one point I should like particularly to make in answer to the noble Viscount, Lord Alexander of Hillsborough, and I hope he might give his attention to what I have to say. I believe at one point in his speech the noble Viscount quoted my right honourable friend the Prime Minister, saying that the Prime Minister had turned down this idea altogether four years ago. It occurred to me, immediately after that, to inquire when the Treaties of Rome came into force, and I find they were not in force at that time, and the circumstances have changed a good deal since.

VISCOUNT ALEXANDER OF HILLSBOROUGH

My Lords, the whole scheme of the Common Market was in existence and that whole scheme was part of the debate on European trade from which I was quoting.

THE EARL OF BESSBOROUGH

My Lords, I am very glad to accept that from the noble Viscount; but the drafts of the Treaties were concluded only in March, 1957, and the Treaties did not come into force until 1958. So far as our own farming community are concerned, we have no agricultural treaty and, as I believe the Government have already stated, it would seem to be right that we should make this move before any such Treaty is concluded; so the noble Earl the Foreign Secretary must be right about this.

So far as the Commonwealth is concerned, I cannot believe that even if there are likely to be major problems to resolve at the outset it will not be in the long-term interest of members of the Commonwealth that there should be this strong and prosperous economic community in Europe. I believe the point was well made in the communiqué following Mr. Sandy's visit to Canberra; and the noble Earl, Lord Home, made a strong point about our earning abroad. He amplified it in such a way that I feel it can only have been wholly convincing to your Lordships.

So far as the political implications of the Treaty are concerned, there has been a great deal of talk and I should not like to add any word to what has been said by the noble Lord, Lord Gladwyn. I agree with every word he said, as I agreed with everything said by the noble Lord, Lord Poole, in that admirable maiden speech. I think these political implications should not be exaggerated. As the noble Earl the Foreign Secretary said in his speech, there is the safeguard in Article 235.

After all, there have been many examples since the war of relinquishing degrees or shreds of national sovereignty in many organisations. If we are to achieve this ideal to which the noble Earl, Lord Longford, has referred and to which we know the noble Earl, Lord Attlee, has given his full support—that is to say, this ideal of one world and perhaps even some form of world gov- ernment—surely we should welcome any stage which seems to bring us forward in that way; and we should welcome not only the enlargement of economic areas but also a further merging of political sovereignties. Some people, especially protagonists of Commonwealth, have said that we make a mistake by going into Europe. Some people sometimes disparage Continental customs and ways of life. This seems to me to be a ridiculous attitude to be taken by a country which has developed as a result of an amalgam of races—Romans, Saxons, Normans, Danes, French Huguenots and even Russian, Norwegian and Austrian refugees, to say nothing of Italian and Spanish labour coming into the country at this moment. Are we really to say that this Island of Britain is not part of Europe?

Again, what of the Commonwealth which is united in its allegiance to our gracious Sovereign? Are not the populations of three of its oldest members mainly drawn from European stock? Have they not been developed largely by Europeans, as indeed have all those great countries in North and South America? Is not Her Majesty the Queen herself of European ancestry, as are other members of the Royal Family? If your Lordships will permit me to say so, Her Majesty, in addition to being Head of the Commonwealth, is a European too—as we all are in this House. This may be unpopular with a certain noble Lord, who is not only a distinguished Canadian and an Empire crusader but also the proprietor of a well-known daily newspaper, but these are facts which I hope he will not fail to publish.

Several Members in both Houses have suggested that the Government should issue a White Paper on the implications of their decision, but I see the several reasons why this may be difficult at this stage. There have been some admirable supplements in the national Press, as we all know; but it seems to me that this is a matter which should have the careful attention also of the United Kingdom Council of the European Movement and its associate organisations, such as the campaign over which the noble Lord, Lord Gladwyn, presides. They might well do more to inform the people of this country of the problems at stake. The U.K.C. and these other groups have done an excellent job in that respect already, but now it is most important that their work should continue and that their efforts should be redoubled.

I wish the Prime Minister and his colleagues every good fortune in the arduous negotiations to come. Some people have said that my right honourable friend is tired and needs a rest. Who would wonder if he were tired when one thinks of the great burdens that fall on the shoulders of a Prime Minister to-day? But whether he is tired or not, it would seem to me that he has dealt with these problems in a statesmanlike manner. No one can say that he has pushed us into the Common Market against our will. Every kind of consultation with others interested has taken place, and will continue to take place in future, before the final decisions are taken.

On the other hand, the noble Earl, Lord Longford, and others have expressed the criticism that the Government have delayed too long. Personally, I think that they have played their hand with great tactical skil. Whenever there is a change interests are always affected, and, on the whole, most people and countries do not like changes, especially if they are reasonably well off as they are. If you ask someone's advice on a matter of this kind, it is right that they should put forward objections, and it is right that the Commonwealth should have done so. But I personally believe that, given reasonable safeguards, the negotiations will succeed. Indeed, we cannot allow them to fail, for it must be remembered that it is not just Britain that will be going into the Common Market, but I believe E.F.T.A., too; and who knows, certain members of the Commonwealth, and even the United States, may also ultimately come to be associated.

The future of the whole Western world, and even the Free World, is at stake. I believe that British industry, finance and commerce should come out of its shell, out of its relative isolation, face the competition, and go into this wider economic group. I consider that our Prime Minster has shown imagination, courage, enterprise and prudence of a kind which few other great Prime Ministers in our history have possessed. I think that in this vital matter we are now doing about the right thing in about the right way.

5.44 p.m.

VISCOUNT KNOLLYS

My Lords, I venture to intervene in the debate to-day because, although this question of entry into the Common Market has been for a long time, and still is, a political one, it was originally, and perhaps still is, an economic one, too. For that reason, I speak to-day purely as an industrialist, in order to refer to some of the effects which I think are likely on some wide sections of British industry if we enter the Common Market. In speaking in this way, one must assume that essential and reasonable safeguards can be obtained regarding, in particular, those in the Commonwealth, whose well-being is important to us from a trade point of view, as well as vitally important to them. One hopes that in dealing with these safeguards they will not be to the detriment of a truly realistic negotiating position on the main issue. To carry a stage further a point made by the noble Lord, Lord Gladwyn, a candidate for membership of an exclusive club does not increase his chances of membership if before he becomes a member he objects to the amount of the subscription to the club, to the food in the dining room, and perhaps, as in this case, to the rules regarding the introduction of guests.

It may be convenient if I relate any comments that I have to make to-day on the more earthy part of this subject (most have been on the political aspect) of the probable effect on industry in the four main divisions of the industries which are comprised in the group with which I am connected, because I happen to know them best. They are engineering, heavy and medium, shipbuilding, aircraft and steel. In engineering the prospects are inevitably bound to be mixed. Some sections of industry will undoubtedly be adversely affected, but new opportunities will be opened up for others; and there should be greater opportunities on that all-important question of collaboration with European partners in business.

Shipbuilding is already doing much to modernise itself—more than it is given credit for in some of the statements I have seen recently. I am sometimes somewhat envious of those of our competitors who have been able, through war, to have the most complete form of modernisation, which is to rebuild their shipyards from the ground up; and envious, too, of the incentives and advantages which they enjoy, but which regrettably are not, so far, available to us in this country. Of course, there is much which still can be done and must be done in modernising, both in equipment and in thinking. There always is. But we cannot do this alone. It is necessary to get the proper understanding and co-operation of labour, and understanding of the Government that increased costs through new taxes, higher transportation charges and various arrangements regarding new assessments of rating, and many points of that kind, certainly do not help that competitiveness which we have to achieve. But if all the shipyards in a Common Market area are going to be able to compete on really equal terms in every way, then I believe that British shipbuilding can benefit.

As to aircraft, where tariffs are not a major factor, we should be better off for several reasons. Airlines of the Six, most of which are in Air Union, are I think likely to be more ready to consider British built aircraft, particularly if there can be some co-operative production work between firms in this country and those on the Continent. The existing programme towards attaining this particular and very sensible objective should certainly be helped and stimulated by entry into the Common Market. If this should happen, then an essential factor of prosperous aircraft manufacture would be achieved by a bigger home market in a new form, where airlines, strong technically, could help to develop new types. We have always found that without this our efforts to sell to the rest of the world are seriously handicapped. The steel industry, which is dependent on the prosperity of its customers, has already welcomed the prospect of entry into the Common Market, more perhaps because it should inject a new dynamic force into the British economy as a whole rather than from any immediate advantages.

If the picture I have tried to summarise of what my own group sees its prospects to be should apply to British industry as a whole, then the answer must be that, on balance, it is surely in the overall interests of our industry that we join the Common Market. There is, though, one point which I think it is always important to remember, and that is that the other industrially developed countries are generally the best markets for our own manufactures. But to take advantage of these opportunities which I hope are going to be given to us, there are certain prerequisites which industry here must be prepared to get down to without delay.

The theme which every industrialist, particularly every exporter, must in any case be putting to himself and to every department of his business at this time, is this: how can we make ourselves more competitive? That was the point which I think was stressed very much by the noble Earl the Foreign Secretary in his speech at the beginning of the debate. It is a slogan which ought to be in every single office. The prospect of membership of the Common Market will surely be a spur to ensure that this question is swiftly answered, for it will, at the same time, provide a new and enlarged market, and also make it essential to be really competitive or else fail to survive, either in home or in overseas markets, for marketwise they will in the end be largely the same.

There are three essential partners who have to do their bit in adjusting industry under these important new conditions: first of all, management, who must more than ever think in terms of competitiveness, plan ahead more than I think has been done in the past, and provide the necessary organisation and equipment. Secondly, there is labour, who must think in terms of new conditions for our industry; that is, to be competitive or fail to survive, and I am sure that labour in this country will co-operate in this field of productive effort. Then there is the Government, the third partner, who alone can provide the incentives and rewards necessary to stimulate and to support the efforts of management and labour. If there are no longer to be any of the special existing incentives anywhere in the Common Market, then I feel that the Government can at least refrain from financial measures which add to costs and defeat the main objec- tive, that of exports, which I am afraid is sometimes not the case now.

Also in that respect with regard to this partnership, I would very fully endorse the suggestion in the Chancellor of the Exchequer's recent statement that these three partners should bring themselves together to get that amount of long-term thinking which will enable general long-term objectives to be set out, to show how far they are feasible, and how far they fit in with the general economic position of the country, for this kind of forward planning (I hardly dare use the word) is essential for the greater stability of our economy. I feel, my Lords, that this may well be the historic moment for modern British industry. I believe we shall take advantage of it, because we must. We led the world once in industrial development. I should like to think that entry into the European Common Market may give us the chance to do so again.

5.54 p.m.

LORD MORRISON OF LAMBETH

My Lords, the subject we are discussing to-day is one of the biggest issues that have faced the British Parliament for many a long year, except declarations of war. It is a profoundly important matter, very, very serious, and it is worthy of serious debate, as it is receiving, from your Lordships' House. I think we can all congratulate ourselves as an Assembly on the earnestness and the seriousness with which this matter has been discussed, although inevitably there are differences of opinion which cut across industrialists and even cut across both the great political Parties.

It is a difficult issue. It is no good one's assuming that this is an easy matter upon which to make up one's mind out of hand. I thought about it for weeks and even months, and I confess that as the weeks passed I did one or two switches from one side to the other and back again, and I am not ashamed of that. Indeed, anybody who takes this decision as one to reach lightly is, I think, being exceedingly unwise. It is for that reason that, with my noble friend Lord Alexander of Hillsborough, I am sorry that the Government did not bring these papers out until to-day. I think they ought to have done it before, because there have been several requests to give us the facts about the Treaty. Moreover, there are other faults as well on the part of the Government. It cannot be helped, but it is a pity that this application for membership of the European unity organisations has come at a time when our country, unfortunately, is in serious financial and economic difficulties.

THE LORD PRESIDENT OF THE COUNCIL AND MINISTER FOR SCIENCE (VISCOUNT HAILSHAM)

My Lords, if I may just say one thing, which I hope the noble Lord will not mind, it is not, of course, the case that we have only to-day brought out any of these papers; they have been published for years. What we have done—and I was grateful for what the noble Viscount said—is to make them available to Members of this House in the Printed Paper Office, which is more convenient, of course. But they have, in fact, been published for years by the Community itself.

LORD MORRISON OF LAMBETH

My Lords, I am much obliged to the noble Viscount. Of course, I congratulate the Government on putting them into the Printed Paper Office. My only regret is that they did not help our education by doing it weeks ago, because, evidently they have existed for quite a long time, and I think that was a pity. However, I was saying that it is unfortunate that we should have this matter to be decided at a time when our country, unfortunately, is in financial and economic difficulties, the reasons for which and the Government's responsibility for which I shall not discuss because we debated that last week. It is just bad luck that it should be so. However, my Lords, that would not be a reason for postponing negotiations and decision in this matter. Already we are rather late in reaching this stage. My point is that it would have been better if the Government had come to a conclusion earlier on, though I appreciate that they had their difficulties within their Party, as we have some within ours. But we need a great deal of education.

My noble friend Lord Longford has referred to the Daily Telegraph. I would refer to the Daily Herald, which had a series of articles explaining, pro and con, if I remember rightly, the Common Market, and they have since published them as a pamphlet. They support the Common Market, it is perfectly true, but this was good journalism, useful to the country. One of the things I could not stand, and which made me say things that I ought not to have said, was the B.B.C.'s silly so-called discussion last week on the Common Market, which was just about as bad as I.T.V.'s Free Speech at its worst. It was a slanging match—and Free Speech on I.T.V. is a pretty awful thing—with everybody interrupting everybody else, and at the end of it I would defy any citizen who watched television and those chaps fooling about to be able to say that he knew more about the Common Market than he did at the beginning. The B.B.C., for which I have a great respect, and which I will champion against commercial television any day, dropped in standing, in estimation and in status by that horrible performance which it put on. I hope these words will reach their Lordships at Broadcasting House.

Of course, the Government on these matters have rather wobbled. I remember going to the first meeting of the Council of Europe when Mr. Winston Churchill, as he then was—and he was in great form—got up, without anybody knowing what he was going to do, and advocated a European Army, a real international show. We of the Labour Party did not jump and pick it up at that moment. We were in government and so we let it go. But he did advocate it. Then in 1951 Mr. Churchill became head of a Conservative Government and dropped the very thing that he had advocated with much passion at Strassbourg just a few years previously.

I think the Prime Minister has had his evolutions. He has had an important political career and, on the whole, at any rate until recently, it has been on the side of enlightened ideas. But he has gone up and down, as my noble friend the Leader of the Opposition showed. I am not making too much of this, because I suppose everybody in the course of his life may have changed his views about something. It would have been far better than waiting for my noble friend to come out and criticise the Prime Minister for it if the Prime Minister had said that this was so and made a clean breast of it. That is the best way of getting away with it, in my judgment.

I thought that my noble friend Lord Alexander of Hillsborough made a sincere, able and understandable speech at the beginning of the debate. I think he is to be congratulated upon it, because I know that he has deep and sincere convictions on this matter. If I do not fully agree with him it will not be by way of criticizing him. We are too good friends for that, and I know he will be understanding, tolerant, and will not hold it against me if I happen to take a different view from the one which he genuinely holds. There are mixed views about this in all parts of industry. An essential point that we must remember is that we are not settling the issue to-day. We are not finally deciding whether or not we shall join the Common Market. What we are deciding, if the Government get their majority, is to make application to join in order that important negotiations may follow; and then, arising out of those negotiations, if the Government think the result is satisfactory, they will come to Parliament and ask Parliament to take the decisive step. I think the noble Earl the Foreign Secretary, who also, if I may say so, made his usual able speech, would agree with that interpretation of the situation in which we are at this moment. So final judgment is deferred by the Government and by the Opposition.

I think the situation has arrived when we cannot delay, even though we are in economic difficulties. As I say, I think it would have been better if we had come to this point at an earlier stage. But we must remember that if we hold out too long, if we do not move at this stage, if we want months or even years of delay it may be that we shall not be able to join the Common Market at all. As it is, there have been one or two people, particularly has there been one person, who did not seem very enthusiastic about the British joining. But I hope that has altered. There are matters to be taken care of. The Commonwealth is profoundly important, and none of us wishes to upset or to endanger our good relations with the Commonwealth countries.

Of all the Commonwealth countries, perhaps the one I personally feel most concerned about, though I am concerned about all of them, is New Zealand. They are, perhaps to a greater extent than the others, dependent upon British trade with them and the British economy. Moreover, they are, as is Northern Ireland, aggressively loyal to the United Kingdom and the Commonwealth, and I like that. I am loyal myself, and I want everybody else to be, too. But that is a great thing on the part of New Zealand. There is never any doubt about where New Zealand will go if the Mother Country is in trouble. So we must do our best to take care of the Commonwealth and its interests, and the E.F.T.A. powers with whom we have been associated—that should be kept in mind.

It is important that we should know the position which has been taken by the Prime Minister as to where we stand in this matter. He said in the House of Commons on Monday, July 31, at column 929 [Vol. 645, No. 159] of Hansard: No British Government could join the European Economic Community without prior negotiation with a view to meeting the needs of the Commonwealth countries, of our European Free Trade Association partners, and of British agriculture consistently with the broad principles and purpose which have inspired the concept of European unity and which are embodied in the Rome Treaty. I refer to these statements of the Prime Minister because I am going to ask at the end for an assurance by Ministers that they mean what they say; that there is no intent to be evasive in the matter—which I am not alleging; though I think we are right in wishing to be assured emphatically that the Prime Minister said what he meant.

My right honourable friend, the Leader of the Opposition in another place, said at column 931: The Prime Minister has, however, made it perfectly plain that what is now proposed is not any decision to join the Common Market, but the start of negotiations to establish the conditions on which we might join. A little later on, at column 932, the Prime Minister said: At every point the Commonwealth will be consulted. I have made it quite clear, and so have my right honourable friends: if, at some point, it were thought desirable to have a meeting of Commonwealth Prime Ministers, at the right moment, probably when the negotiations had reached a certain stage, before any final decision were put before Parliament and this country, then I can only say that I would be the first to welcome such a meeting. I have read those extracts in order that they may be underlined by Ministers who take part in the debate, and that we may be doubly assured about the matter.

Agriculture is important, and that will be a factor in the negotiations. We are not asking that the Commonwealth countries should each have a veto over anything the British wish to do in this matter. That would not be tolerable, and it must be remembered that in economic matters the Commonwealth countries themselves take their own course—naturally, and not improperly—when they think that their own national economic interests warrant that being done. The Dominions have done it from time to time in the way of duties and import quotas. I am not saying that they should not, but I think it fair to say that although we must do everything we can to take care of the Commonwealth, nevertheless the British have some right, in this troublesome world, to take care of themselves as well. We have our rights; and, after all, in essentials, despite the Channel, we are part of Europe, and I do not think we can get out of that. Our electorate has rights. Possible future Labour or Socialist Governments will have their rights, and I hope very much that the Leader of the House was right when he said that they need not worry that the Treaty will prejudice the possible policy of a future Labour or Socialist Government, which is, of course, for the British electorate to settle, and not other people.

The Council will be there. Political powers are importantly involved, and perhaps the political side is in some ways a little more worrying than the economic. But it depends upon what kind of political set-up comes about. I am inclined to think that the idea of a Confederation is better than something like the United States Congress running the United States of Europe—not quite to the extent that the Congress does, but to a considerable extent. I would sooner have Governments co-operating. As I tried to explain to the Continentals at one of the meetings of the Council of Europe, the difference, in our view, is that the French and Italians, for example, are liable to accept a doctrine, the whole thing. But when it comes to the point we find that there are reservations.

There was a Frenchman who, in a great and eloquent speech, said that he was proud that the new Constitution of France had left in the original wording of the Constitution that France was willing to give up its sovereignties for the good of the world. I said, "That is fine, but I will guarantee that when you come to give up some of your sovereignties, or you are faced with the question, you will find reasons why there should be exceptions to the doctrine which is laid down in the Constitution, and you will get away with it." I said, "That is your way of thinking; it is not for me to be abusive about it; but I will tell you the British way. The British learn as they go; they are a bit ad hoc in their thinking. They are not rejecting all ideas of international co-operation in Western Europe, but they want to try things out; do one thing at a time; then add to the thing when they begin to see the light about it. Therefore they move by practice and experience, whereas you move by theory and then go back on the theory if you want to." That is the difference between the British process of thinking and the process of some thinking on the Continent of Europe. I am not saying who is right, but I think I know.

However, despite all this talk about the political situation we really must not play the fool, using words about people's names and then saying "I am not going to mix up with that man." Other countries elect in some way the Government they want. I was not happy about General de Gaulle getting the dictatorial powers he got, and I said so on television, when the view of some other prominent people in the Labour Party was that it was not too good but that it was the only thing they could do. Moreover, I think he is a hit of an awkward chap—I thought that during the war. He is not a typical Frenchman; in fact he is quite unlike the average Frenchman: he is cold and distant, and over-dignified. Nevertheless he must have ability to have "got away with" the things he has. I am not going to say, however, that, because I do not praise General de Gaulle, therefore we must not join the Common Market. That really would be idiotic. It would be equivalent to the French saying they do not like the Prime Minister—and we might agree with them. It seems to me that they have no right to tell us who is going to be our Prime Minister, and we have no right to tell them either.

Then some other people use the word "Adenauer" with bated breath as if he is a shocking chap, a sworn enemy of our country. They are absolutely wrong. I know Dr. Adenauer very well. I have had the pleasure of talking to him several times and shall be glad to do so again. He is a good friend of this country and a good European. He is a friend of peace; and in Germany he, with the Socialist leaders, has made a much better job of Parliamentary democracy than the Germans made after the First World War. So why should people use the word "Adenauer" and say that they will not have anything to do with him? They might as well say, on one ground or another, that they will not have anything to do with the President of the United States, which would be plainly absurd and ridiculous.

It seems to me that some people are very anxious to be "buddies" with Mr. Khrushchev, of the Soviet Union, and Mr. Mao, of China, which is a curious thing. I have no objection to doing business with Mr. Khrushchev or Mr. Mao. I am willing to do business with anybody for the sake of peace and for the good of the world and for our country. But my feeling is that these men are much more trouble than Adenauer or de Gaulle; and, moreover, they do not believe in democracy, and say so. It is a curious lack of logic that is tolerant to the Communist totalitarians and intolerant about the men who, in the case of Adenauer is a good parliamentarian and a friend of Europe, and de Gaulle, who, while not perfect, might be worse.

My Lords, it is no good Socialists, of whom I am proud to be one, saying, "Workers of all countries unite", and then adding, "but not with the French under de Gaulle; not with the Germans under Adenauer; not with the United States under their capitalist Government." We live in a mixed world. We are living in mixed political Parties on this subject now, but we have to live in a mixed world, and that is all the more reason why we should fight for the causes in which we believe, and why we should be sufficiently tolerant to enable the peoples of the world to live in peace and friendship with each other.

Now I come to the economic aspect about this proposal—and I do not say that it is particularly simple. The people who negotiate this business on either side will have plenty of worries, and there will be sonic different brain processes lake place with the British as compared with some of the Continentals; it will not be easy. But I remember the first time I went to the United States of America—I have been there seven times, and I hope to go again. What impressed me was the vastness of that country. There were 48 States then; there are now 50. In a sense, they are supreme States. The only powers the Federal Government have are the powers conferred upon them by the Constitution, or granted by Congress; otherwise the States are supreme.

The thing that particularly impressed me was the absence of customs and tariff barriers between those 48 States. Supposing they had had them—and they could well have had these tariff and customs barriers. It would have hamstrung the internal trade of the United States of America, which has become extensive and, on the whole, apart from their sort of prosperous inflation, successful, due largely, I say, to the absence of barriers between the trade of the various States. If it is right for the United States, it seems to me that it is in principle right for Western Europe, which potentially in this matter has a population of 300 million; much bigger than that of the United States and much bigger than that of the Soviet Union. It does seem to me that, as an economic proposition, by and large, though it will hurt us here and there, it is right that we should go into this scheme.

Not so long ago we used to talk about the desirability of a United States of Europe. When M. Briand brought that argument out—I think the British Socialists had brought it out before—it was received with considerable enthusiasm; and, if I am not mistaken, many Labour leaders at the time thought it was a good idea. If we believe in a United States of Europe, what is the matter with some unity between the Western European countries? I should have thought that in principle it was right, and I think there ought to be as a whole—and one can talk only about "as a whole"—economic advantages in the Common Market idea in Western Europe.

It is true that we shall have to face competition within these numerous countries with a tariff wall around the lot—not each of them, but the lot. But I am not sure that a little competition will do us lasting harm. Perhaps a little competition may do British industry good. I think some parts of it have been avoiding competition too much. I am prepared to tolerate private enterprise, within its proper sphere—at any rate, whether I am prepared to or not, we must, as things are—but what I do not wish to tolerate is private unenterprise; and at present we have some of that. If this new state of affairs livens up competition it may be a good thing.

My Lords, the idea is opposed by the Communists and the Communist countries. If it were practicable and if there were sincerity all round, they would be welcomed into this new concern; but, of course, in their case it is not practicable, and they would genuinely avoid it, so that they would almost certainly be unwilling. But they ought to be the last to grumble. They have a "Common Market" in Eastern Europe behind the Iron Curtain, and they have a centralised political direction over their European colonies in Eastern Europe. The truth is that the Communists want to make the West weak, not only militarily but economically, because if they make the West economically weak they will automatically make it militarily weak as well. I think there is a great deal of hypocrisy going on in the Communist Party and among their sympathisers elsewhere.

If we go in we have a potential 300 million free trade market. We have not been able to get a free trade Commonwealth, for reasons that we all understand; the British Commonwealth has not full free trade, though there is some preference between various countries of the Commonwealth. If this comes off, I should like the idea some day to be extended to N.A.T.O. and the N.A.T.O. countries as well. That would make an even bigger and much more successful economic proposition than Western Europe. I think that going in will liven up our industry, give us some of the advantages the United States has; and, of course, it will help peace in Western Europe. One of the curses of Europe has been the traditional enmity between France and Germany, as was, earlier, the enmity between France and ourselves. France and Germany are now co-operating, are good friends; and I think that is right. If we stay out we lose those advantages. Western Europe will expand economically and we, relatively, may economically contract. Many of our factories will transfer to within the tariff wall of Western Europe; in fact some of them are going to Western Europe now—the process has started.

My ultimate idea in international government is a World Government as an instrument of a mixed lot of countries, but free countries, democratic countries, and free peoples. In the end, within proper limits that is right. It is not practicable to-day, because we cannot yet solve this Communist problem, but since I believe in world government as an ultimate ideal, within this sphere, I can hardly object in principle to this step on the way, if agreement can be reached. I think it is consistent with that ideal, and therefore I think it is right.

Our island has had a great place in the world; it still has a great place. We have often done much in the way of helping the world towards sanity, and in world leadership I believe that the British have a part to play in the European community. Therefore, subject to the results of these negotiations, I think it is right to take the proposed step.

6.23 p.m.

LORD STONHAM

My Lords, I am most grateful to my noble friends Lord Longford and Lord Morrison of Lambeth for assuring me that their support for our entry into the Common Market springs from their Socialist beliefs. I am reassured because in 1948 when I attended, in company with the noble Lord, Lord Netherthorpe, the conference at The Hague on a United Europe it was frowned on in official Socialist circles. So it is good to know that I am now, as it were, restored to the fold.

It is obvious, of course, since I was a signatory of the manifesto which was originated by 'the noble Lord, Lord Gladwyn, and am now a member of the Common Market Committee, of which he is Chairman, that I warmly welcome the Government's decision. I have throughout my political life believed in this kind of union, both economically and politically. I can indeed share the regrets of my noble friends which are sot out in the Amendment that the Government action has been so long delayed, and that, as our Amendment indicates, we now go into these negotiations from a position of economic weakness. But that is the only criticism I can make. I do most warmly welcome the Government's action. Indeed, if there is a Division to-morrow night, and I find myself in a small but select company, it will be for the sole reason that I greatly appreciate the value of that company and like the company in which I shall find myself; because I feel that there is absolutely no argument at all on general grounds against the action the Government now propose to take. Indeed, in my view, the consequences for Britain and for Europe of our staying outside the Common Market are too disastrous to contemplate.

The noble Viscount, Lord Knollys, dealt with a number of points with regard to industry, and I should like to deal with some of the objections and fears that have been raised in connection with the agricultural industry. It is my experience that people do not understand or appreciate the most abstruse points which are discussed with regard to the Treaty of Rome. What they are concerned with, and I think quite rightly concerned with, is the question, "How is it going to affect me?" The issue has to be broken down into those points, how, so far as we can gather, is it going to affect the individual. After all, that is the most important point.

For the last 35 years I have owned and farmed a small farm, and I have been through the very bad times of the inter-war years. Throughout my political life I have fought for the interests of a prosperous agriculture, and I should be the very last to advocate any kind of policy which I believed would be likely to affect adversely the interests of the farming community. I am not only convinced that entry into the Common Market is the one way to ensure the continued prosperity of British agriculture, but I am certain that that prosperity will be destroyed if we stay out and adhere to our present open market system.

Last year nearly two-thirds of the food we consumed in this country—I am speaking of food which can be grown in temperate climates—was raised on British farms. That included the lion's share of many staple foods, about 90 per cent. or more of liquid milk, eggs in shell, barley, oats and potatoes, and two-thirds of our meat. This year I think the proportions will be appreciably less, for the simple reason that, except for meat, all those foods are in surplus and we are the world's only major free food market. So to an ever increasing extent we are becoming the world's dumping ground. This year, as we know, there has been dumping of eggs, milk products, and barley. The French have sold barley here at £10 a ton less than the price they are paying to their own farmers. Russia, too, has entered our market on a substantial scale. Market prices have gone down, and the taxpayers' subsidy bill has gone up.

As European food production increased, of course, the dumping would also increase, and the situation would become worse. We should, therefore, be faced with the alternative of ending the free market and the price support system or destroying British agriculture. I submit that if we join the Common Market dumping will cease, dumping not only by countries of the Six but also by other countries. Then, of course, the argument runs that we should be at the mercy of the low-cost producers of the Six countries of the Common Market. I doubt it. Germany, a high-cost producer, apparently has no fears; and as yet no evidence has been produced at all, so far as I am aware, that France produces at lower cost than we do. I do not believe they do, because it is against all the probabilities.

British agriculture is unquestionably more efficient. We have an overall average of something like 70 acres per farm compared with perhaps less than 25 acres per farm on the Continent. We are far better capitalised and technically more advanced. For instance, we have one tractor to every two-and-a-half workers, whereas on the Continent the proportion is one tractor to nearly nine workers. That is one of the reasons why, in the last ten years, we have increased output per farm worker by 40 per cent. That is a quite incredible achievement and I think, with proper encouragement, this trend will continue. I am convinced that our efficient, mechanised, modern farming industry has nothing to fear from the Continental peasant farmer.

But then the objection runs: you will have to abolish the support price system of farm subsidies. Your Lordships will be aware that during the last three years, on every possible occasion, I have tried to prove how stupidly and disastrously expensive this system has been to farmers, taxpayers and consumers alike. I think its abolition would be the greatest economic blessing the Government could confer on the long-suffering farming community and the housewife. Consider how farmers, taxpayers and consumers alike have suffered under the price support system. In the last ten years, although farmers have increased their efficiency by 25 per cent. and therefore their production by 25 per cent., they are now, in real terms, 12½ per cent. worse off than they were ten years ago. No other industry in the whole country has fared anything like so badly as that; and it has cost and is costing the taxpayer £250 million a year to provide even this miserable Irishman's rise.

If we decided now by decree that the farmers should enjoy to-day the same living standards that they had ten years ago, when they were producing 25 per cent. less food, the taxpayers' bill would be £500 million per year. You have only to mention such a staggering sum to realise the tragic failure of the price support system. It has been possible for the Government and the Treasury to continue it so long only by depressing farmers' living standards. I express the view, as a member of the National Farmers' Union, that it is to the eternal discredit of the N.F.U. that, last year, they should have brought themselves to say that such a system was the best for British agriculture. That is why I say that its abolition would be a blessing, and one of the blessings which can arise from our entry into the Common Market.

Last week I asked the Government whether steps could be taken to control imports of Russian barley. The noble Earl, Lord Waldegrave, said [OFFICIAL REPORT, Vol. 233 (No. 117), col. 1090] that this would require a major change in the Government's free market policy and the system of agricultural support by deficiency payments. I believe that major change cannot come too soon. I submit that we do not have to wait for entry into the Common Market in order to make that change; we should do it now and adopt the Continental system of import levies and tariffs. We should then be gaining experience of the kind of system under which we shall have to work, if and when we enter the Common Market. What would be the effect of such a change? The taxpayer, of course, would be relieved of this annual burden of £250 million, because farm production grants, which I hope will continue, would be paid for out of the tariffs and levies. The farmer would sell at prices roughly equivalent to the level of the present guarantees and would not be any worse off—perhaps in some commodities he would be a little better off.

Then the argument still runs that there will be higher prices in the shops. I question that. Present retail prices are quite high enough to allow processers and distributors ample profit, even if they paid full guaranteed prices. One of the unexplained mysteries of the present system—I hope that whoever is going to reply for the Government will try to explain this mystery and deal with it—is, that as farm prices fall, prices in the shops rise. For example, although barley prices are a post-war low, practically back to pre-war, the price of beer is an all-time high. Although wheat prices continually fall, bread prices continually rise. For example, wheat is two-thirds of its 1951 price, but the price of bread is more than double.

The Minister of Agriculture, Mr. Soames, said last month that the price of Canadian hard wheat was the same to-day (that is, last month) as it was in 1960, but that English soft wheat was £18 a ton compared with £24 10s. last year; and he added that home milled flour was 16s. a ton dearer. That means—and it is beyond any kind of denial—that the middlemen have pocketed that extra £6 10s. a ton profit. There is no other possible answer to it. If the price of the product has gone up and the price of the raw material has gone down, then the people in between have enjoyed the extra profit. It really means that the subsidies have been used to depress farm prices and that the housewife does not benefit. It is more than time that the Government acted. If distributors and processers were satisfied with reasonable profits there would be no need for shop prices to go up, if and when we go into the Common Market.

I believe those are the only points which I have heard raised from the agricultural point of view in regard to our entry into the Common Market, and I think they have been answered. I am delighted that the noble Lord, Lord Netherthorpe, is here, because I shall be most interested to hear him to-morrow deal with those points, and perhaps demolish them; or at least make some kind of an answer as to why it is that the prices of these commodities are so much lower than they were ten years ago but the prices in the shops are so much higher, sometimes double. I submit that this is something that entry into the Common Market can avoid.

There remains the genuine fear which farmers have expressed, that the countries of the Six may wish to fix farm prices at a level which British farmers would find unremunerative. I think that is most unlikely. Twenty-five per cent. of all workers in France and over 40 per cent. of all workers in Italy work on the land. Agriculture is of supreme importance to them. There is not the slightest chance that their people would agree to a level of prices which British farmers would find unremunerative. The French Prime Minister made clear in a broadcast on July 29, the difficulties that would be encountered, and said that As regards farm products the Treaty of Rome remained more of a hope than a reality. I warmly welcome what was said by the noble Earl, Lord Home, that now is the time for us to enter into these negotiations, particularly in respect of agriculture. However unfortunate it may be that we did not start some years ago, I think the time for this particular point is now, and that for the same reason we should at the earliest practical moment endeavour to deal with the problems of the Commonwealth. But I would say that, even there, the difficulties are not on anything like so wide a front as some people would have us believe. After all, tropical foodstuffs and almost all Commonwealth raw materials enter the Common Market freely now, and presumably they will continue to do so. These raw materials bulk large in total Commonwealth exports. Wool, for example, represents nearly one-half of Australia's total exports and more than one-third of New Zealand's.

Of course, there are very difficult products, such as grain and dairy products, where it is no use blinking the fact that we shall have very considerable difficulties. But I would say this, my Lords: at the end of the day, when the negotiations are completed and when we have got all the concessions that we can, if, as may well be the case, we have as regards those difficult products not got everything which we should have liked on behalf of the Commonwealth, I would submit that that would not be a reason for not coming to agreement on our entry into the Common Market. I think that we should then search round to see whether we can find other ways of helping the Commonwealth producers.

I suppose that, of the major maritime nations of the world, we alone do not in some way or other subsidise our shipping. I should like to know, and perhaps the noble Viscount will be able to tell us later on, whether it would be completely "out", under the terms of the Treaty of Rome, if, for example, we subsidised British merchant shipping and if the subsidy were used to give a freight advantage to Commonwealth countries who were shipping these difficult products—grain and other things—to this country. It might well be that by these and other means we could restore any loss that might arise to the Commonwealth countries from the negotiations which are taking place.

VISCOUNT HAILSHAM

My Lords, if I may interrupt, the noble Lord will find that it is incompatible, under Article 92 of the Treaty.

LORD STONHAM

I am grateful to the noble and learned Viscount. Then we have the corollary: the other countries of the Six will obviously have to discontinue the illegal practices that they are now carrying on. But it was at least worth a question, and it illustrates the kind of thing that I have in mind: that we should, from the very beginning, make it clear that we are determined that the Commonwealth shall not suffer. I feel that if we make that clear we shall find a way, perhaps several ways, to reach the objective.

Finally, I should like to say a word on the question of sovereignty, and the possible loss of sovereignty, which seems to worry a great many people. In 1946 there was formed in this House the British Parliamentary Movement for World Government, of which I was the first Treasurer; so at least I became accustomed to the idea of the advantages of the surrender of sovereignty a long time ago. I find it difficult to understand how some form of union or regional federation or association involving a loss of sovereignty can be in any way incompatible with the wider and ultimate objective of world government. I would just say this: the classic definition of war, which is very frequently overlooked, is: A collection of sovereign States in contact. In other wards, war is continuous while sovereign States are in contact. When countries surrender sovereignty over matters of common interest they achieve peace.

My noble friend Lord Morrison of Lambeth has mentioned the impression which was made on his mind with regard to the 48, now 50, States of the United States of America. The 50 widely differing countries of the United States of America came together in a democratic way: the many countries of the United States of Russia were fused by totalitarian methods. The important point, my Lords, however, is that within both those unions war is extremely unlikely; and I feel that it would be the same within, whatever you like to call it, something comparable to a United States of Europe. I am equally sure that we shall never be certain of peace until we are wise enough to surrender or fuse certain basic sovereignties. I think it is true that, in the nuclear age, national sovereignty is an illusion, whether it is bolstered up by an expensive but totally inadequate Army or a hopeless determination to "go it alone" in a trade war. I would say that those who still believe in such things should ask themselves whether the British people can best fulfil their pride of race as equal partners in a prosperous, peaceful Europe or as sovereigns over a radio-active desert.

6.46 p.m.

LORD AUCKLAND

My Lords, as another Session of Parliament draws to a close it is perhaps opportune that in both Houses to-day we should be discussing what is perhaps one of the greatest decisions of the century: whether or not we should enter into the Common Market. It is in terms of future years that we must think as well as of the present. I am quite certain that none of us would want the name "Commonwealth" to become, in future years, a forgotten word—already it is a ward which is denigrated in some quarters—and I have confidence that the Government will ensure that the Commonwealth will be given the maximum protection and consultation in all negotiations which may take place. But it is to be hoped that, in 50 years' time, our children, at their school desks, will not think of the Commonwealth in the same terms as they may think of, say, the Jacobite uprisings—as another history lesson; and I think it is incumbent on Parliament to-day to make sure that they will not.

My Lords, to quote the phrase of one of the greatest statesmen of all time, "In this matter, time is not on our side". We have to decide quickly, but we have to decide carefully. On balance, I believe that our entry into the Common Market will do nothing but good to this country. As a nation we have a proud record of leadership. We have given the Commonwealth a great deal of leadership during the past two centuries or so, and now we can give Europe leadership. There are many countries in Europe, and particularly in the Six, which do not possess Governments and economies as stable as one would like them to be, but I believe that, even at this late stage, we can give them that leadership.

There is already one very big commercial institution, namely, Lloyd's, in which I myself work, which in a sense operates its own Common Market. We have a great deal of long-term treaty business with countries like Italy and Belgium; and by and large it works quite well. Naturally, of course, we should like to capture our own markets as well. Here I should like to pay my own tribute to the outstandingly good maiden speech of my noble friend Lord Poole, who himself has distinguished connections in Lloyds, and is dis- tinguished in many theatres of business. He made an incisive speech which was entirely convincing.

My Lords, there is one matter which is causing worry, and that is the business of horticulture. I believe that Scotland, in particular, is worried on one question. One of the relatively new industries of Scotland—at least I think it is fairly new—is the growing of raspberries; and a train now runs every day from Coupar, Angus, to London, with fresh raspberries. Indeed, in my own experience there is nothing to beat English fruit, be it apples, strawberries, raspberries, or tomatoes. If I may turn to the excellent and lucid publication by the Daily Telegraph, Britain and the Common Market, which is the first publication that has enabled me to understand the Common Market, I see that it says in one section: There would be no tariff or quota protection against Continental imports". I feel that the horticulture industry might well be worried about that, because already our markets and our shops are over-flooded, to my mind, with Italian tomatoes and apples; and it would be a great pity if apples from Australia and New Zealand were handicapped by this.

I turn now to cars. There was a protest in one newspaper, which has always been hostile to the Common Market, that the Volkswagen would be a good deal cheaper. Personally, I do not subscribe to that protest. The Volkswagen is a very good car, and some of our own cars are not, perhaps, of as good a quality as they might be. I feel that entry into the Common Market could provide a great incentive to our motor manufacturers to produce more sturdy cars. Many of our cars have tinny bodies, and their performance certainly does not measure up to that of many Continental cars, although there has been an improvement over the past five years or so.

The noble Earl, Lord Longford, mentioned that, by and large, the Press had been very fair-minded towards the Common Market; and I think that is true. But I am very concerned about the attitude of the Daily Express, if I may be allowed to quote one newspaper. They are, of course, entitled to their views, but they have not stressed the fact that the Government are only negotiating to enter the Common Market. While not wishing to be unfair to the Daily Express, I feel sure that the ordinary person reading this chain of newspapers might well get the impression that we had already decided unconditionally to enter the Common Market. I rather hope that the tone of these newspapers will change.

The other specific point that I want to raise is in regard to Article 48 of the Treaty of Rome, which deals with the influx of workers. I hope that the Government will state quite categorically that this country will not become flooded out with foreign workers who have no proper jobs to go to, and that workers who do come in will not be able to change their jobs ad infinitum. I think that that is especially important in agriculture. Many of the small farms in Bedfordshire and East Anglia are already suffering from a labour shortage. It is true that bona fide workers from the Continent would help them, but it is to be hoped that it will not be to the exclusion of the British worker.

My Lords, over the past weeks people as a Whole, and especially young people, have been taking more and more interest in this subject. The other evening I addressed an audience of young Conservatives. I touched on the subject of the Common Market, in a completely non-Party manner—because it is a non-Party matter so far as the country is concerned—and I was bombarded with questions. This is a healthy sign, because it is the young people of this country who will feel most of all the implications of the Common Market. I would end by stressing that, whatever negotiations the Government enter into, I think they are adopting the correct attitude that the Commonwealth, and especially Australia and New Zealand, will be very firmly considered.

6.58 p.m.

THE EARL OF GOSFORD

My Lords, I must apologise to your Lordships for not having a speech as well prepared as your Lordships are entitled to, but on arrival at the House to-day I expected to find that I was speaking tomorrow, and to my astonishment, I found I was down to speak this afternoon. But I venture to speak to your Lordships, none the less, because having a certain first-hand knowledge of the Continent, for I have lived there for a certain amount of time as well as worked there, I feed that I could make a few remarks about our attitude towards the Continent and the Continental mind. If we in this world are ever to return to the conditions before the Tower of Babel, when all were alleged to have spoken the same language, it seems to me that this step of which the Government have given notice—and I, amongst many of your Lordships this afternoon, welcome it—must be taken if we are eventually going to have real peace on this earth and move out of the present state of the cold war. As the noble Earl the Foreign Secretary said in his admirable and very pleasant speech this afternoon, we are only asking permission to enter, and not in fact taking the final step.

If Europe is to survive, Europe must come together and weld itself into a much more tightly-knit group of countries than it is at present, which must include Britain. Of course, there are difficulties and problems, about which we have heard this afternoon—the Commonwealth, agriculture and E.F.T.A.—but given the spirit, there is no doubt that these problems will eventually be solved. But—and this is the basis of my remarks—we shall not solve them unless our negotiators are men who understand the Continental mind. After all, we have been cooped up in this island for a 1,000 years or more and it is difficult for us to realise what the Continental is thinking. The main impression that we must give the people of the Continent is that we are approaching them with a vew to helping and not disrupting, to strengthening and not to weakening. Europe will not welcome us unless we discard the attitude of looking down our noses at the Continent. Unfortunately, that attitude still exists. We had an example of it when the Six offered us a chance of associating with them. If I remember rightly, we did not exactly snub them; we did not even bother to reply. That is the sort of attitude which has now disappeared, and I hope that it will not return.

I was in Germany and Holland last week and I heard on all sides that these two countries—and I am sure this applies to Belgium also—will welcome us with open arms. Of course, there will be reservations about France, but I am sure that many of us understand the difficulties in which she finds herself. We must bear with France; and, after all, she is only one of the Six. As the Foreign Secretary said, with patience we will achieve the end. I shall not touch on any other of the problems in detail. Your Lordships have heard them already this afternoon. The Foreign Secretary, who was Secretary of Commonwealth Relations, is happy about the Commonwealth attitude, and who am I to be otherwise? I must say that I welcome this. The noble Lord, Lord Knollys, told us that industry as a whole would seem to welcome this step, and from my own small knowledge of industry I know that it is true. I am sure that the genuine competition which joining the Common Market will engender will come to eradicate the restrictive practices on both sides of industry, and that is something which will be good for the ethics of this country.

In his admirable maiden speech the noble Lord, Lord Poole, said that we must face up to the fact that we are living in a new world, but while we are negotiating, we must remain steadfast to our friends in the Commonwealth and E.F.T.A. With patience, with understanding and with the realisation that the countries on the Continent do welcome us, provided they realise that we come to help and not to hinder, this great step will prove of benefit not only to ourselves, not only to Europe and to the Commonwealth, but also to the world at large.

7.5 p.m.

LORD HAWKE

My Lords, like the noble Lord, Lord Morrison of Lambeth, I have had great searchings of heart over this problem. I have read an immense amount of literature on the subject and, like the noble Lord, I have gone from one side to the other. But my economic doubts are now resolved, and therefore I support the Government approach. The march towards political power will be full of difficulties for all the partners, but let us meet these difficulties and devise their solution as they arise, and not try to conjure them up to meet them in advance; because it is very likely that the problems will be different when we actually come to deal with them.

My economic doubts were on agriculture, free trade in manufactures and the Commonwealth. Agriculture I do not see as a food factor. I regard it as a way of life, as a stream of replenishment of lost vitality in an urban people; and no industrial nation can afford to neglect its agriculture. It appears to me that the Common Market is likely to have precisely this same approach to this problem, and I believe that British agriculture would be safer in the philosophy of the Common Market than it may be in the philosophy which at times tends to prevail in this country.

I turn to manufactures. To me, free trade is a problem to be approached in a purely pragmatical manner. I do not share the almost religious fervour with which Cobdenite ideas have captured a large part of the Conservative Party. Free trade between comparative equals, if over a sufficiently large area, is obviously a good thing, as has been proved by the United States in their immense area of free trade behind a very high tariff barrier. But in my opinion there can be no free trade between those who are grossly unequal, no free trade with costless Communist blocs and no free trade with the civilisations of the Orient based on rice-bowl wages. And I believe that here the Common Market will have much the same philosophy. I do not think that there is going to be any nonsense about Communist or Oriental goods destroying large and efficient industries paying Western wages in a Common Market. Some people are doubtful whether we can compete within the bloc with those whose standards are roughly our own. Well, if we cannot do that, we shall certainly perish if we stay out. So we had much better go in, and, if necessary, learn to compete.

My third doubt is about the Commonwealth. We must not let down those great Dominions who share our creed, but I do not believe that there is any need for them to be let down. The Anglo-European bloc is still going to eat. In fact, with increasing population and, we hope, a rising standard of living, it is going to eat more and more. Any increase in food production in Europe is likely to be, on the whole, high-cost production, and the low-cost producers of Australia and New Zealand should be able to surmount any reasonable tariff. In fact, I think they may be in a better position than they are at the moment, when they are faced with great uncertainty, owing, as the noble Lord, Lord Stonham, has pointed out, to the peculiar nature of our farm support.

But supposing they do not like to take the risk, cannot we do something even better for them? What every farmer in the world wants is a guaranteed market at a known price—of course for an unlimited quantity, but one cannot admit that. But can we not consider whether guaranteed markets and guaranteed minimum prices for a limited quantity can be provided, in view of our position as a huge consumer? And can we not share the possible cost of this with their own Governments? If we do so, are we not entitled to ask for some reciprocal benefit?

The benefits of the Ottawa preferences have been largely whittled away by the change in the value of money, and it seems to me that the Dominions, on the whole, get rather better value out of their remnant than we do. I believe that here is an opportunity of starting something new which would form a still more valuable link than we have at the moment. By and large, the food they grow is wanted here in Europe, or in this country, or in the under-developed countries for which we and Europe have some responsibility and which we are pledged to help. Surely there are in this the makings of a scheme which would do a great deal to resolve their doubts, and we should be a big enough Community to consider approaching the Americans to see whether in certain commodities the same considerations could not apply.

Quite apart from the economics of food and raw material production, a close link with the great Dominions is of immense interest, I should have thought, to the countries of Europe, because they have no outlet under their own control for migration for their own surplus population to temperate climates; and I should have thought that emigration to the Dominions would be of great interest to them. The rest of the Commonwealth, of course, is in somewhat of a state of flux and we do not know of what the Commonwealth will consist in ten years' time. India and Pakistan are very heavy millstones round our neck economically; and what about these newer territories in Africa?

Whatever we do, they will ultimately have the choice of affiliation, friendship or whatever we may call it, economic and sentimental, with one of three great blocs: the Communist world, the American world or the Anglo-European world. Those who are subverted from within will choose the Communist world, as they will do whether or not we join the Common Market. By and large, I do not think that most of them have much liking for the American way of life, and I do not think they will choose the American world if they can get satisfaction of their needs from the Anglo-European world. I believe that they will, on the whole, prefer the world of London, Paris, Bonn and Rome, which centuries of Christian civilisation have proved to be the culture centres of the world. So that, taken overall, the Anglo-European world will have the need for the production of markets in the whole Commonwealth, and I do not think it is impossible to provide adequate safeguards. Of course, our going in will add immensely to the possibility of their obtaining the capital and resources they all need.

My Lords, I do not believe that an approach is going to mean ruin for our agriculture. I do not believe that it is going to mean ruin for our industry, and I do not believe that it is going to mean ruin for the Commonwealth. But if all these think they are going to be ruined, and if the Government have to provide safeguards in advance against every conceivable mischance, then our approach will obviously be unsuccessful; and if we miss this chance, I do not know what suitable alternative course we have.

7.16 p.m.

THE EARL OF LISTOWEL

My Lords, I am grateful to noble Lords whose powers of sedentary endurance and sustained interest in the subject of debate have carried them through to the final speech. I have listened to the debate, of which I have missed only one or two speeches, with peculiar interest because noble Lords who have spoken have for the most part devoted themselves to the merits and demerits of the Common Market and it is apparent from what they have said that most noble Lords, both on the Benches opposite and on this side of the House, are in favour of the Common Market—of course, on suitable terms. This alone is a fact which I am sure will be of importance for Her Majesty's Government to consider and of importance also to the public here and on the Continent; and it will be a fact of even greater significance if the same thing happens in the course of the debate to-morrow.

I propose, however, to do something far more dull and far less stimulating than has been done by some noble Lords who have preceded me—namely, to talk about the Motion before the House and the Amendment which noble Lords on this side of the House have put to the Motion and have invited your Lordships to accept. I believe it may be of some interest, at any rate, to your Lordships, and it may be useful in view of the fact that we may have a Division to-morrow night, to know some of the arguments which we should like your Lordships to consider in favour of the Amendment which we have tabled.

We take the view that the Government have seriously mishandled this great issue of the Common Market which, as several noble Lords have said, is the most important issue which the Government and the country have had to decide since the war. First, several noble Lords on this side and on the Benches opposite have already said—and I believe it needs to be said again—that Her Majesty's Government should have provided the public with much more information so that the ordinary citizens, and of course the young people for whom the noble Lord, Lord Auckland, was speaking in particular, may be in a position to form a judgment about this issue when they are asked to decide whether or not this country should go into the Common Market.

I do, of course, appreciate the Government's difficulty, which has very rightly been pointed out, about publishing their own views about the Common Market before these negotiations have even begun, or even making comments which could be mistaken for views. But surely that could easily be avoided. It should surely be possible to publish a White Paper limited to the essential facts—

VISCOUNT HAILSHAM

What are they?

THE EARL OF LISTOWEL

—and not opinions. There would be no need for the Government to express opinions about the facts in such a Paper. May I give one or two examples of what I mean? Could the Government see any objection to publishing a summary of the main provisions of the Treaty of Rome? The Treaty of Rome is not likely to be read by a very large number of the public or even by your Lordships from beginning to end. But surely it should be possible for any clever draftsman to compile a summary of its main provisions and to include these in a White Paper. Of course, the Government could point out, without in the least departing from the facts, that this, like other Treaties, is one which can be amended by agreement.

Furthermore, they could as an interpretation of the Treaty, which has already been given by the noble Earl the Foreign Secretary and the noble Lord, Lord Gladwyn, the greatest protagonist of European unity, agree about what we refer to in this House as derogation of sovereignty. The ordinary man is asking whether Britain will lose its independence if it goes into the European Economic Community. Surely it should be possible, if the Government take the view that has already been expressed about the derogation of sovereignty, to say that the only field in which our hands would be tied would be the economic field—and that is a matter upon which it appears the noble Lord, Lord Gladwyn, and the noble and learned Viscount the Leader of the House both agree. I am quite certain that this is not something of which the ordinary man in the street is aware, and that it is something of which he should be aware. That is one suggestion.

I should like to make one other suggestion about the possible contents of such a White Paper. Would it not be possible, again without departing from facts and agreed interpretation of the facts, to give some sort of historical data about the Six and what has happened since this Association of European countries was formed? Would it not be possible to describe their trade relationships and the economic development that has taken place in these countries since the Association was formed? That, in itself, would help the public to form a judgment about whether it would be worth while for this country to go into the Economic Community. I am quite certain that 99 per cent. of the population are not aware of the commitments we should undertake if we adhered to the Treaty of Rome, and that they do not understand the economic implications of associating with these countries in Western Europe. I feel that the Government ought to do much more than they have done up to now to provide essential facts and objective data on which the ordinary man can form a sound judgment. That is one complaint that I have against the Government.

My next complaint is this. We on this side of the House think that the timing of these negotiations is thoroughly bad. We take the view—and, indeed, this as a general principle is one which I think noble Lords opposite would not disagree with—that you should negotiate from strength and not from weakness. We have always been told that when you are negotiating for political advantages or disarmament, or whatever it may be, you want to negotiate from military and economic strength. Similarly, when you are negotiating, as we shall be, for economic advantages, you want to negotiate from economic strength, and to show that there is every advantage for the people with whom you are negotiating in having a British market to which they can send their goods. If the Government had started these negotiations several years ago, when we were in a state of prosperity and had more to offer, then their task would have been much easier than it is at the present time. They have made the whole thing far more difficult by allowing this period of time to elapse before starting to negotiate with the countries of Western Europe.

The third complaint that we have against the policy of the Government relates to the Commonwealth. Your Lordships will notice that in our Amendment we have said that general acceptability to the Commonwealth should be a necessary condition of entry into Europe; and furthermore, that we think a Commonwealth Prime Ministers' Conference is the best way of testing Commonwealth acceptability. I do not want any misunderstanding to arise as to what we mean by "general acceptability to the Commonwealth". We do not mean that any single Commonwealth country should have a veto on what we want to do, or that we must wait to negotiate until we have convinced opinion throughout the Commonwealth that we are right. No other Commonwealth Government will accept this from us or act in this way, and, therefore, it would be perfectly reasonable for us to proceed without getting as wide a measure of agreement as that. What we mean is that the integrity of the Commonwealth is more important than our entry into Europe, and that we must obtain during our negotiations with the Six conditions of entry that will enable our Commonwealth partners at least to acquiesce—we cannot expect them all to agree with any feeling of enthusiasm—in what we propose to do. Surely, both the political and economic terms of entry, whatever they may be, must be consistent with the major national interests of our Commonwealth partners.

One of these major national interests is certainly international trade. We shall not find it at all easy to form new trading connections with Western Europe without damaging our existing connections with the Commonwealth. An obvious example is that the Commonwealth countries which supply us with foodstuffs, such as New Zealand, will suffer greatly if we can no longer give them preferential treatment in the United Kingdom. If we find—and logically it looks extremely likely—that our present system of Commonwealth preference is incompatible with a common external tariff for a Common Market area, then surely what we must do is to endeavour to compensate our Commonwealth partners for the loss of their preferential advantages. It is not for us here in this House to work out how such compensation can be arranged; that is a matter for the Government and for those to whom instructions will be given by the Government when they take part in the negotiations with Western Europe. This, at any rate, should be one of the main objectives of Government policy when these negotiations begin.

I should like to point out only one way in which I think it is obvious that certain Commonwealth countries could be compensated if we were to enter the Common Market. There are the advantages of associate membership provided for by the Treaty of Rome. Your Lordships will remember that the French territories of French Africa have already received these advantages as associate members, and there is nothing in the Treaty of Rome which would prevent countries of British origin in Africa from being associated with the Community in that way. The two outstanding advantages which the French countries have enjoyed, and still enjoy, are free access for their products to the European market, and investment of capital by the Community in their relatively undeveloped industries and agriculture. Countries like Ghana, Nigeria, Sierra Leone, are, of course, in very much the same position as the French territories, and I very much hope that the Government will do all they can to see that, if the United Kingdom joins the Common Market, then the benefits which now go to the French countries will also accrue to the British countries in Africa. I believe that part of the Treaty dealing with associate membership is being negotiated next year, so that this would seem to be a very good opportunity of dealing with our Commonwealth partners in relation to the Community.

My Lords, we go on to say in our Amendment that the conditions we negotiate with the Six should be "generally acceptable to a Commonwealth Prime Ministers' Conference". Why do we place so much more emphasis than the Government appear to do on a Prime Ministers' Conference? It is perfectly true that the Government do not rule out a Prime Ministers' Conference, but we take the view that the Prime Ministers' Conference should be proposed, at any rate, on the initiative of the British Government. The reason for this view is that we have found from experience that a Prime Ministers' Conference is the best way of ironing out differences between Commonwealth countries on major issues. The differences between us and our partners were shown up extremely vividly during the recent Commonwealth tour of Cabinet Ministers. T do not know whether the Government were surprised, but I certainly was surprised, and I have come across many other people who were very surprised, by the amount and the extent of opposition that was shown to the Common Market policy.

When I say that we recommended this course from experience, I should like to point out a very close parallel in the case of India. In 1948, India wanted to stay in the Commonwealth after becoming a Republic. At that time my noble friend, Lord Attlee, who was Prime Minister as Mr. Macmillan is to-day, decided to send emissaries to find out the views of the other Commonwealth countries on this proposed step. I myself was one of the Ministers sent on this Commonwealth mission, and I can speak from my own recollection when I say that there was serious opposition in some quarters to the idea that any country could stay in the Commonwealth after it had broken with the Crown. That opposition was perfectly understandable, and I am sure that your Lordships will appreciate it.

What my noble friend Lord Attlee decided to do, in order to carry the Commonwealth with us—which is, I am sure, what the Government want to do at the present time—was to invite the Conference in London to discuss the specific issue of India's remaining in the Commonwealth as a Republic. Now at that Conference there was unanimous agreement that India should stay, and in this way the greatest threat to the unity of the Commonwealth since the war was averted. Surely this is the most useful precedent for what we are commending to the Government and to your Lordships this afternoon. We are simply suggesting that Her Majesty's Government should take the initiative in proposing that this procedure should be used to carry the Commonwealth, to get the endorsement of the Commonwealth, to any conditions that may be negotiated in relation to entry to the Common Market.

My Lords, the noble Earl the Foreign Secretary said (and I do not think anyone would agree with him), that we in this country need the economic strength which the Common Market might give us, both for generating capital for development in the underdeveloped countries and to give us the purchasing power we need to buy Commonwealth products. He went on to say that we must earn £500 million more than we are earning at the moment in exports in order to do both of these things; and no doubt he is right.

THE EARL OF HOME

And defence.

THE EARL OF LISTOWEL

And to cover defence expenditure.

THE EARL OF HOME

Overseas.

THE EARL OF LISTOWEL

Defence expenditure overseas. In other words, to avoid balance-of-payments crises here and to help our friends in the Commonwealth. I am grateful to the noble Earl for making it perfectly plain that I have not misunderstood him.

My Lords, that is an aim with which we should all agree. But what are the Government doing to increase production so as to earn this additional income from our exports? The policy of the Government, unfortunately, is not to expand production but to contract production all round—that is to say, production for the export markets, as well as for the home market. We shall not be able to export our products to Western Europe; we shall not succeed in doing what the noble Earl and all of us want to do, unless we produce more at competitive prices at home. So a Common Market policy must, if it is to succeed, be supplemented by an expansionist policy at home. That is exactly what the Government have failed to give us.

The noble Earl, Lord Home, in his speech referred to the Atlantic community and to the interdependence of Europe, the Commonwealth and the United States of America. My only complaint about that was that he referred to it so briefly, only in one short passage, because I felt that it was really the most important thing that he said in his speech. Surely Western Europe can be only a first step. We must look to the much wider unity of the North American countries and Western Europe. I am so thoroughly convinced of this that, when I was asked the other day to become Chairman of another organisation—it is so difficult to take on more work, as your Lordships know—the European Atlantic Group, I agreed to do so. The noble Earl, Lord Bessborough, is President, and I could hardly fail to follow his example. But I feel that this is something of urgent and immediate importance, and we must not lose sight of that if we decide to go into the European Community, because the tariff wall which we shall build up against the outside world, if we do this, is bound to affect adversely our economic and trading relations with the United States. The only way we can get over that is to negotiate with the United States, either through G.A.T.T. or bilaterally, for a mutual reduction of tariffs, with economic unity as the goal at which we are aiming, in Europe and between all the countries of Europe and North America.

LORD GLADWYN

With respect, I believe the United States seek the further unification of Europe, including ourselves, and would not object to a certain amount of discrimination provided it was not too much.

THE EARL OF LISTOWEL

The noble Lord is perfectly right about the policy of the United States, but what I wonder—the noble Lord may well be right—is whether the main reason why the United States support us in this policy is not political rather than economic. My own feeling is that what the United States need is the economic, political and military strength of Western Europe, and that they are prepared to put up with whatever economic disadvantages may follow simply in order that Western Europe, including the United Kingdom, may be strong. That is my interpretation of American policy. I do not know whether the noble Lord, Lord Gladwyn, would agree. After all, the North Atlantic Treaty, to which we have adhered, contains provisions about economic, social and political co-operation and unity, which have not hitherto been implemented. It is not just a military Treaty, and it seems to me that these provisions have been sadly neglected hitherto. It is most important that in times to come we should try to carry them out and, above all, that we should see that closer relations with Western Europe do not mean a greater distance from America or greater strain on our relations with the United States.

I hope very much—and I appeal to the Government—that the noble Viscount, when he speaks, or the noble and learned Lord on the Woolsack, will make it plain not only that this approach of Europe is not intended to interfere with or detract from our present relationship with the United States, but is a step towards a much greater unity in which the whole of the Western world will be united in one community.

VISCOUNT HAILSHAM

My Lords, I beg to move that the debate be now adjourned.

Moved, that the debate be now adjourned.—(Viscount Hailsham.)

On Question, Motion agreed to, and debate adjourned accordingly.