FOREIGN MINISTERS' CONFERENCE

HC Deb 18 December 1947 vol 445 cc1874-87

The Secretary of State for, Foreign Affairs (Mr. Ernest Bevin)

I very much regret to have to report to the House the failure of the Foreign Ministers' Conference to reach agreement on the German and Austrian Treaties.

The House will be aware that under the Potsdam Agreement there was established a Council of Foreign Ministers which was given very definite duties. Its specific principal purpose was to draft peace treaties for Italy, the German satellite states, Germany and Austria. While it is true that in the making of treaties, questions of policy of a fundamental character arise, its main purpose, the main intention behind it, was to be a businesslike instrument for the drafting of peace treaties for submission to the Peace Conference. The exact language is as follows: As its immediate important task, the Council shall be authorised to draw up, with a view to their submission to the United Nations, treaties of peace with Italy, Rumania, Bulgaria, Hungary and Finland and to propose settlements of territorial questions outstanding on the termination of the war in Europe. The Council shall be utilised for the preparation of a peace settlement for Germany to be accepted by the Government of Germany when a Government adequate for the purpose is established. Unfortunately, ever since its existence the Council of Foreign Ministers has alternated between carrying out its original function and being used for entirely different purposes. Our work, therefore, in bringing about peace has been handicapped. There is no doubt that this has created despondency in the world, instead of the realisation of the hope that the responsible Ministers of four great Powers would be able to get to know each other and express their views freely to one another, and thereby promote a spirit of friendship and understanding. Unfortunately this has not been the case. To His Majesty's Government this has been a great disappointment. In our view the negotiations for the peace treaties for the satellite countries took far too long and created a great deal of unnecessary misunderstanding. In our view the Italian Treaty was delayed months longer than should have been the case. But at New York at last we did achieve the result of getting treaties for the satellite Powers and Italy.

Then at last we got to work on the Austrian and German Treaties. In the view of His Majesty's Government the Austrian Treaty was separate and distinct and ought to have been settled quite easily when the satellite treaties were concluded, had there been the will to settle it, especially in view of the declaration of the three Powers in Moscow who agreed in 1943 to recreate Austria as an independent State and of the subsequent agreement to provide a treaty for that purpose. If this had been carried out with speed, Austria, Eastern Europe and the Balkans would now have been working hard on reconstruction and rehabilitation, and all the troops from the Danubian Basin could have been withdrawn.

The main difficulty in the case of the Austrian Treaty, as the House will be aware, was the question of German assets. At Potsdam we were working on the understanding that the Soviet Government would not claim reparations, but would be content with German assets, but the interpretation that has been placed by the Soviet Government on German assets has resulted in the property of United Nations nationals being taken as well. Austrian property has been taken, and, what is more, a claim has been made and is being exercised for extra territoriality in the exploitation of these resources; that is to say, that they are not being subjected to the general Austrian law.

That is a position which, in all these treaties, His Majesty's Government cannot accept; in fact it would have been better, far better, for Austria if she had been told what she would have to pay and to have left her with control of her own economy. So what was thought to be a generous act has, in fact, been used to get a grip on the whole Austrian economy. To an extent, this was due to a lack of definition at Potsdam in the wording of the Agreement, and, no doubt, that is the excuse for this action, but it has been carried beyond any reasonable definition. We have, therefore, to try to get an agreed definition. When we found included in the term "German assets" the whole of what was absorbed by Hitler after the Anschluss, it was, in our view, carrying the definition too far, and doing what was never intended or understood.

This, in a few words, has been the main point which has held up the Austrian treaty. However, at Moscow, the question was fully discussed, but we failed to reach agreement. We then set up a commission to work in Vienna on a factual basis, with the hope of getting a concrete settlement which could be submitted to the Governments. A concrete settlement was submitted and accepted by three of the Governments—France, the United States, and ourselves. In consideration of this proposal, on behalf of His Majesty's Government, we offered to make a contribution to the solution of this problem in order to help to get a more definite and final proposal. We also agreed to waive any claim on behalf of our nationals beyond the standard fixed for Austrian nationals themselves for compensation for war damage. That had been done in the hope of getting a final agreement.

However, in spite of the breakdown of the present session of the Conference, and in view of the fact that there was an indication that a new proposal might be forthcoming with different terms than we have had up to that moment, the Austrian question has now been referred back to the deputies, and I would not say a word about this which would embitter the situation. We can only hope that a concrete proposal for the settlement of Austria will soon be forthcoming. If we get it, we will get to work at once and try to clear up this Austrian situation to give Austria again a chance to live after all the travail she has gone through with Hitler and since.

As regards the German settlement, before I went to Moscow in March of this year, His Majesty's Government worked out a set of political and economic principles based on the Potsdam agreement which we regarded as the next stage in the organisation of Germany which would ultimately lead to a final solution. I claim that these proposals were well thought out, and I need not go through them because they have been circulated to the House. We tried at Moscow to make these principles a working paper, comprising, in all its facets, the whole problem of Germany in the next stage of its organisation. I am sorry to say that we made little progress. However, I left Moscow and I hoped that, in November, when the Conference was to meet again, a changed situation would arise and that we might yet get a settlement of this Middle European problem, but, in the meantime, a propaganda developed which caused things to go from bad to worse.

I will try to explain the situation, in as short terms as possible. Europe was in chaos, impoverished, unable to find, capital and other equipment for rehabilitation. We were constantly meeting the representatives of Europe who were asking us for help, and it is well known to all sides in this House that our financial and industrial position did not give us the wherewithal to give them assistance. Then came the Marshall speech at Harvard. We welcomed that speech and we tried to turn it to the advantage of Europe as a whole, but, to our great grief, instead of every country taking advantage of that plan, the Soviet Government stepped in and used tremendous pressure on their immediate neighbours, and, in fact, ordered them not to participate. I feel that this action was violating the free choice of these States, and really interfering with their independence and sovereignty. A campaign was then started by the Soviet Union against this attempt to help Europe as a whole, applying epithets to it which I have always felt were totally unjustified.

Then came the formation of the Cominform and the resultant disruptive tendencies in Western Europe. This was followed by the speeches made by the Soviet representatives at the United Nations Assembly, which seemed to His Majesty's Government to be intended to create an atmosphere which would make a settlement very difficult indeed. Similar attacks were made at the Control Council in Berlin just before the Conference opened. To all these attacks, we have not seriously replied. We have endeavoured to go on with the belief that, in the end, we should get agreement. We did feel that it did not augur well for the Conference, but we still persisted and went on with the Conference, hoping that, in the calmer atmosphere of discussion, we should be able to make progress. I have experienced so many of these set-backs that I hoped we might still be able to get to grips. Unfortunately, the hostile propaganda continued during the three weeks that the Conference lasted. It made it really impossible for us to get to grips with the fundamental principles involved.

Then we came to the Conference, and we had a long and, in my view, unneces- sary argument about the agenda. We settled this after two days, and the Austrian treaty was referred to the deputies, and, after considerable differences there, it came back to the Conference, again with no results. Then, we at last succeeded in getting the British paper on Germany accepted as a working paper. When we got to grips with it, however, and came to face the fundamental issues, we could not make progress. On Germany, we began with the form of the German Peace Treaty. A number of propaganda speeches were made, which were dearly out of place.

After this, we came to the question of the German frontiers. The four Powers must clearly reach an agreement on the frontiers of Germany, subject to confirmation at the Peace Conference. As M. Bidault said, it is ridiculous to try to discuss German affairs without knowing where Germany is going to begin and end. The French put forward their claim for the economic integration of the Saar. As the House knows, His Majesty's Government have always supported this, provided the exact frontier is delimited, and the reparations balance adjusted. There was also a number of other frontier claims put forward by our other Allies.

I suggested that the Council should establish at once one or more frontier commissions, to go thoroughly into these claims, to hear the evidence, and to report to the Council in the shortest possible time. These commissions would cover all the frontiers of Germany, including the Western Polish frontier which was left for the final Peace Conference to determine finally. On the question of whether it ought to be where it is or not, I did not, and do not now, express a view. I was willing that it should be gone into by the Commission. What other means could we adopt for settling this difficult question of frontiers but that one? M. Molotov, however, would not agree, and we had to pass on, leaving this matter unsettled. We did manage to reach agreement on a few minor points about the German Peace Treaty, but there could be no substance in the agreements until the other urgent matters had been settled.

The next matter we discussed was that of the economic principles, that is to say, the principles for securing and maintaining the treatment of Germany as an economic unit, in accordance with the Potsdam Agreement. Certain fundamental points were thrown up at once. There was, first, the need for a common import-export plan for Germany as a whole, and the pooling of indigenous resources. If these objects are to be realised, the zonal barriers must come down. There must be complete freedom of movement for men, ideas, and goods throughout the whole of Germany. The Soviet delegate did not reject this, but made it clear that he could not agree until central German administrative agencies had been set up. We had to deal with this problem of central German agencies in relation to the whole question of political principles, and that matter was left.

The next point was the unqualified principle that the first charge on Germany's foreign exchange resources, after Germany's essential needs had been met, should be the repayment of the sums advanced to Germany for the payment for her imports. This principle was in exact accord with the Potsdam Agreement. We got nowhere on this, and were met with a number of long speeches, and unjustified and false accusations. I had to make it clear that we in this country had had to borrow precious dollars from America and deprive our own people of what those dollars could buy in food, in order to finance the import of food into Germany owing to the Potsdam Agreement not having been carried out. His Majesty's Government, therefore, expected these advances, which we have borrowed and which we have to repay, to be repaid out of Germany's resources before any more was taken away from German economy.

The third fundamental question was the relinquishment by the Soviet Government of their acquisitions of German enterprises. These acquisitions virtually amount to the exercise of extra-territorial rights in Germany, and would prevent the resources of these undertakings coming into the general pool for a balance of payments. We asked for an undertaking that they should stop. The reply we had was to be accused, untruthfully, of removing enterprises from our zone. The result was that no agreement was reached.

We then came to the question of of reparations, and let me make the position of His Majesty's Government clear once again. Capital reparations have been, and are being, removed from the Western zones. That is all to which His Majesty's Government are committed. We did not agree at Potsdam, and, as far as I can trace in all the papers, there was no commitment at Yalta, or anywhere else, to reparations being taken from current production. Neither did we ever agree to an overall figure, whether it was TO billion dollars, or any other amount, for German reparations. On the other hand, I have repeatedly said that I would not close my mind to the possibility of reparations from current production having regard to what the Soviet suffered, once a balance of payments had been reached in Germany. That position stands now.

This is an intricate question, and it depends upon the level of industry, the rate of German recovery, and, above all—and I emphasise this—upon full information as to what has been already taken out of Germany. We and the Americans gave this information in full, and we asked, as we had asked before, for information about removals from the Eastern zone. My experts advise me that the figure I have quoted of seven billion dollars taken from that zone, is an underestimate. However, I asked for the facts. The request was refused, and I cannot see how three other Powers can be expected to commit themselves to any fund of any kind unless the whole of the facts from the four zones are on the table for us to examine. We were told that we could only have this information if we agreed to Soviet claims for reparations in advance.

Our request, I suggest, was just and reasonable, and we asked no more of our Allies than we are willing to do ourselves. I could not make any blind commitments, in these circumstances, on behalf of His Majesty's Government. Reparations can only be paid if raw materials and food are imported, and, if these are imported, I cannot commit this country to find any more money in order that reparations may be paid to any one of our other Allies.

Throughout the whole of the Conference, there was insistent pressure by the Soviet delegation to get us to agree, in advance, to the immediate establishment of a central German Government. The view of His Majesty's Government on this is clearly set out in the political principles to which I have referred. We recognise how important it is to have a central German Government, just as we recognise the importance of the unity of Germany. We do not want, and cannot agree to, an over-centralised German Government—one that can so easily again become a dictatorship. We are in favour of a central German Government. It is a question of design and powers. It also involves the powers which will be enjoyed by the Länder. It must be a truly representative Government, and not one which is simply a tool in the hands of an occupying Power. It would be no service to the German people, or to the world, to agree to the establishment in Germany of any unrepresentative and bogus German Government.

An attempt was made to make us appear as the opponents of German unity, and the opponents of a German Government. Nothing can be further from the facts. The essential unity of the German people is something which we recognise, and, sooner or later—and I hope, for the sake of all of ns, sooner—this unity will be achieved. I do not want to create a situation which makes unity be created on the basis of an irredentist movement. I would prefer that it came democratically, on an organised basis, and on the foundation of a proper Constitution.

Finally, a word to the German people. I realise that they are still without a Peace Treaty, and that the work of preparing a Peace Treaty has hardly yet begun. I realise how disappointing this is. It is our intention, however, to see, to the best of our ability, that the German people do not suffer from this state of affairs. I do not know what is going to happen in the future. We have been accused of making all kinds of preparations to divide Europe, and to set up alternative Governments. Perhaps it would be a fair criticism to make against us, not that we have made these preparations, but that we have not made any at all. If it is imagined that we entered into all sorts of commitments in case the Conference broke down, that is untrue. All sorts of insinuations have been made, but we have stuck to our policy of German political and economic unity under allied control, with safeguards for our own security. That is the main thing we are considering. This has been the policy of His Majesty's Government throughout and we have not changed it.

I made it clear, however, in the Conference that if there is to be no settlement between the Four Powers we cannot go on for ever with the burden of cost this represents, with Western Europe in chaos, and with no means of redress. If we are to succeed there must be an acceptance that we British are peace-loving people with nothing else but a desire for a just settlement. We do not accuse those who do not see eye to eye with us of being warmongers or of being dishonest. Meanwhile we are going to push on to raise the Gentian standard of life in accordance with our promises, to rehabilitate their industries, to keep to the new level of industry, always remembering that we must not push Germany ahead of the liberated countries.

His Majesty's Government would prefer time to study the problem as it now is in all its aspects. It really means taking a grave decision in face of the world and of the future and we would prefer to meet the House after the Recess in a full and, I hope, calm Debate, when we could go into the matter more fully. We have no aim and no desire to divide the world. But the termination of the Conference and the manner of its ending, I have no doubt, will cause many people furiously to think. We cannot go on as we have been going on. We have hoped against hope that four-Power collaboration would work. Most of the world Powers can find a basis of agreement; they cannot all be wrong. We shall close no doors. We shall maintain all the contacts we can and we shall do our best to try to find a way out of all these difficult situations, and still to work away hard to produce in the end what I still believe is necessary, not only a united Germany but a united Europe and the peace of the world.

Mr. Eden

I do not think any unprejudiced person in this country can feel other than sympathy with the right hon. Gentleman himself at the breakdown of this Conference. I think we all understand full well how valiantly and how single-mindedly he has laboured to bring it to a successful conclusion. In saying that, I say it also, if I may, so far as I am concerned, to Mr. Marshall and Monsieur Bidault. I understand we are to have a Debate when we come back and, therefore, I do not want to detain the House long, but only want to make two points. First, about Austria. I hope this deputies' Conference, as I understand it, on Austria will reach a successful conclusion. It seems most unjust that this small country, struggling to try to regain its right place in Europe, shall continually be subjected to these hardships of occupation which make its economic recovery and, if I may say so, its expression of political freedom, virtually impossible. Therefore, I wish the right hon. Gentleman all the success he can in anything he can do in this new sphere.

The other point is on the general situation. I quite understand that the right hon. Gentleman wants to reserve his comments on this occasion. It seems to us on this side of the House that there is now no choice open to us but to do everything in our power to promote recovery in that part of Europe where we are still free to act—that is to say, Western Europe. We should, in our judgment, set to work on that task as speedily as possible. The Marshall Plan is there as a framework, and within that framework we can work successfully and, I trust, speedily and finally. It is evident that Germany will have to play her full part in that and the machinery of Government in the three Western zones of Germany will now require a further readjustment in the light of the present conditions. I hope that can be done quickly. In the interests of the peace of the world we should take account of realities of this breakdown and go ahead with those who will work with us as speedily as we can.

Mr. Clement Davies

We all deeply sympathise with the Foreign Secretary in the failure of his efforts when we all know in the House that he has tried so very hard. It is reasonable that the House should accede to the request he made Lt the end of his speech. The position is a very, very serious one and any decision made may be fraught with the most serious consequences. It is only right that the Government, and all of us, should have time for consideration before we make any suggestions.

Mr. Warbey

While endorsing a good deal of the Foreign Secretary's criticism of the Soviet delegation's use of this Conference for propaganda purposes, could I ask the right hon. Gentleman whether he does not also attach some blame to the American delegation for the definite breakdown of this Conference?

Hon. Members

No.

Mr. Wilson Harris

I would like to express my admiration for the restraint and objectivity of the statement made by the Foreign Secretary. May I refer to the Austrian situation? He stated that the deputies were at present endeavouring to work out terms of a treaty. In the event of their being successful, will the Foreign Ministers meet again or can the matter be carried through to its conclusion?

Mr. John Hynd

I do not wish to make a long contribution, but I would like to pay tribute to the persistence with which the Foreign Secretary has carried on these negotiations, which have been so unhappily unsuccessful. First, in regard to the Austrian Treaty. In view of the situation that has arisen, whatever happens now the Austrian position cannot be settled within a period of at least a few months. Will the Foreign Secretary see that instructions are issued to our people in Austria that, so long as the occupation is rendered necessary by this set of circumstances, every endeavour will be made to reduce the burden of that occupation, and the burdens inseparable from the occupation for the Austrian people. Will he consider, for example, making an announcement that this country renounces all claim to German assets in Austria which will be of use in rebuilding the Austrian economy?

In regard to the German side, I should like to ask whether, in continuing to pursue our search for a united world through the United Nations organisation now that we are unhappily forced to a unilateral policy of reconstruction in those parts of Europe in which we have some influence, my right hon. Friend will see that some German authority, political or otherwise, will be established in that part of Germany which we do control; and that in considering further immediate steps in Germany, it will be consulted on the basis of co-operation with other nations?

Mr. Gallacher

There are many queries I would like to raise, but I will confine myself to one which I must ask. Will the right hon. Gentleman explain if he is going to carry on developing the Western part of Germany? It has been emphasised by the deputy Leader of the Opposition. If the Foreign Secretary is in earnest about that, will he keep his promise to this House and nationalise the industries in the British zone of Germany, and will he face up to Mr. Marshall on that question?

Mrs. Ayrton Gould

I should like to pay tribute to the Foreign Secretary for the magnificent effort he has made, and to sympathise with him in its failure. About Austria, I should like to ask whether, in view of the fact that it is no fault of the Austrian people that the occupation forces have to remain there, it would not be possible for us to lighten the burden where our occupation forces are concerned, and to do as I understand the American Government have done—pay tile costs of our own occupation forces.

Mr. Cocks

As to the plan the British Government put before the Conference in Moscow and recently in London, will the right hon. Gentleman publish this plan in the form of a White Paper, so that we may be conversant with all the details?

Mr. Bevin

The first question I was asked was whether the United States Government were responsible for the breakdown. I have not praised or blamed. What I have said is that we could not carry on. If we put forward proposals, and we hear two or three hours of accusations—which have nothing at all to do with the case—about our taking stuff out of Germany, and the rest of it, all I can say to the hon. Member for Luton (Mr. Warbey) is that, although I know he has greater sang-froid than I have, he would become worn out with it as well. One cannot go on like that. We must be accepted as honest people across the table, if we are to settle a problem, and when we give answers and assurances they really must be believed.

With regard to the point made by the hon. Member for West Fife (Mr. Gallacher), I am happy to state that socialisation was one question on which the Soviet Union, France, Great Britain and America arrived at a decision unanimously. It was proposed, I think—I am speaking from memory now—by the United States, that the socialisation of industry in Germany should be made sub- ject to the endorsement of the German people. That was seconded by Mr. Molotov, and I accepted it.

Mr. Gallacher

Why, then, pass the buck to him all along?

Mr. Bevin

I represent only one Power. This is a four-Power business. We cannot do these things on our own. I put forward what I promised to the House, and advocated it in the Conference. I could not do more. When my colleagues put up a reasonable suggestion, I accept it. That is the only way one can get agreement. I am very glad that on the question of socialisation, unanimity was arrived at between the United States and the Soviet Union. That, I think, augurs well, possibly, for the future on other things.

As to the matter of Austria, I really think I ought not to be asked to answer these questions now. The matter has to be taken into account, with all that is going on in Austria. What I have said is that we would offer to make a contribution. But it is of no use our offering to give up all British assets in Austria, and then leave them to go to another Ally. I want to know what is going to happen to them, and the whole thing has to be negotiated. I met the Austrian representatives yesterday. I shall do what I can. We stand second to none—we do not advertise our good deeds quite enough, I think—but we stand second to none in what we have done for Austria since the occupation. Not long ago a £10 million credit was handed over, and we have done all we can.

There are certain things which I have been asked, concerning which I must ask time for study. With regard to the question about the British plan, I did place it in the Library. It has been there a considerable time, I think, now. Possibly when we come back after the Recess much of what we proposed may have to be changed, and it may be possible to publish a statement of what our future policy may be. It would be better to direct the mind of the House to the future, rather than to what we failed to do in the past.

Mr. James Hudson

I should have liked to ask the Foreign Secretary whether he would persist, in reference to Germany, in the admirable policy that he has indicated. I would ask him still to pursue it, despite all disappointments about Austria. I think he is very much to be congratulated, after all the difficulties that he has experienced. I hope he will persist in trying to get an eleventh hour settlement in Austria. What I want to know is this. It is a long time to 20th January, when the Debate can take place. Many things may happen. Indications are given in the Press of steps already being taken that may crystallise the situation. That may mean, not what the right hon. Member for Warwick and Leamington (Mr. Eden) said the peace of the world—but precisely the opposite. I would beg at this moment that, despite all his disappointments—and I agree with the Foreign Secretary fully, that he has striven hard, and harder than any man, to avoid the disasters that seem to await—he will, with reference to Germany, and with reference to the world situation arising out of Germany, make another effort to get some sort of arrangement which will be all-inclusive on that matter.

Mr. Skeffington-Lodge

With regard to the matter of refugees, will my right hon. Friend use all his influence with those concerned to prevent a further drift of refugees to the British zone? We cannot possibly afford to assimilate any more in that zone, and one fears that in the present situation there may be a tendency on the part of various people to leave their homes and try to move across the face of Europe to other parts of it. There are far too many wandering nomads already, and I would beg my right hon. Friend to use his influence to prevent more people being uprooted.

Mr. Bevin

I have discussed the question of the refugees with the United States Government and with the International Refugee Organisation, and we are trying to do our best to clear the situation up in the Western zones and in Austria, where it is a great burden. With regard to the crystallising of the position, I think I have already said in the statement that I shall do nothing at all that would create an irredentist movement, but rather work for ultimate unity. However, as the right hon. Gentleman the Member for Warwick and Leamington (Mr. Eden) said, I cannot let the standard of life go on in Germany at 1,550 calories. We cannot do that whatever the situation may be.