EUROPEAN ECONOMIC COMMUNITY

HC Deb 02 August 1961 vol 645 cc1480-606

3.42 p.m.

The Prime Minister (Mr. Harold Macmillan)

I beg to move, 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. We must all agree that the problems involved in the future of our relations with Europe are among the most difficult and the most important that the nation has ever had to face. The moment of decision, however, has not yet come. What the House is now asked to do is to support the Government's proposal to initiate negotiations on the Common Market within the terms of the Motion. When those negotiations are completed one way or the other, the House will have to pass judgment.

The underlying issues, European unity, the future of the Commonwealth, the strength of the free world, are all of capital importance, and it is because we firmly believe that the United Kingdom has a positive part to play in their development—for they are all related—that we ask the House to approve what we are doing.

After the last war, the process of reconciliation in Europe was itself a deliberate and positive act in which forbearance and even forgiveness played their part. It first took, I remember, a dramatic form when, in 1950, the German delegates were admitted to the Council of Europe. At that time, my right hon. Friend the Member for Woodford (Sir W. Churchill) conceived the notion of what he called the three interlocking groups, Britain and the Commonwealth, Europe, and the New World. He spoke of them, I remember, as three leaves of a piece of clover, or, again, as three intersecting circles. Of course, he was right in his analysis, but ever since then we have been, in one way or another, trying to find a practical solution to the problem of their interconnection.

N.A.T.O. brought together thirteen nations of Europe, one great Commonwealth country—Canada—and the United States in an alliance partly military, partly political. The other Commonwealth countries took no part, not because they did not sympathise with our purpose—many of them certainly did—but because they were distant from the Atlantic area. Some nations of Europe, like Sweden, remained neutral, partly through their tradition and partly through their position. In the O.E.E.C., the European group was somewhat widened to include countries such as Switzerland. Again, in the Council of Europe, we had another slight variation.

Meanwhile, there has grown up the practical application of the aspirations towards unity in continental Europe by the formation of the European Economic Community. I ask hon. Members to note the word "economic". The Treaty of Rome does not deal with defence. It does not deal with foreign policy. It deals with trade and some of the social aspects of human life which are most connected with trade and production.

Whatever views are held of what should be our relations with the E.E.C., everyone will readily acknowledge the tremendous achievement involved. Its most striking feature, of course, is the reconciliation of France and Germany. That is on the moral side. But on the political side these countries have made remarkable economic progress in recent years. Of course, that is not all due to the European Economic Community. Nevertheless, the Community has imparted an impetus to the economic growth of the Six. The Community has developed a dynamic of its own. Above all, it is an idea which has gripped men's minds.

At the time when E.E.C. was being discussed, most people felt that it would be dangerous to split Europe in this way, and a great effort was made for two years, during negotiations in which my right hon. Friend the President of the Board of Trade played a conspicuous part, to form a free trade area upon an industrial basis, excluding agriculture, thus allowing almost all European countries to take part.

This negotiation, which, at one time, seemed to have encouraging prospects of success, finally broke down. After this setback, some of the countries outside the Six formed the European Free Trade Association and one of its declared objects was to work for wider trading arrangements in Western Europe, and E.F.T.A. has steadfastly pursued that objective ever since its inception.

I am myself convinced that the existence of this division in Europe, although it is superficially of a commercial character, undoubtedly detracts from the political strength and unity of Western Europe. If we are to be involved in Europe at all, then we have a duty—and so have all the other countries in Europe—to seek some means of resolving the causes of potential division.

In this country, of course, there is a long tradition of isolation. In this, as in most countries, there is a certain suspicion of foreigners. There is also the additional division between us and Continental Europe of a wholly different development of our legal, administrative and, to some extent, political systems. If we are basically united by our religious faith, even here great divisions have grown up.

Nevertheless, it is perhaps worth recording that in every period when the world has been in danger of tyrants or aggression, Britain has abandoned isolationism. It is true that when the immediate danger was removed, we have sometimes tried to return to an insular policy. In due course we have abandoned it. In any case, who could say today that our present danger had been removed, or will soon disappear? Who doubts that we have to face a long and exhausting struggle over more than one generation if the forces of Communistic expansion are to be contained?

I have sometimes heard it asked, "What would happen if one of the countries with which we might be associated in Europe fell into political difficulties, even went Communist? Would not this have a grave effect on us if we were members?" Of course, but the effects would be equally grave whether we were members of the Common Market or not. If a member of N.A.T.O. or W.E.U. went Communist or semi-Communist, what would be the position of the other member States? If all the countries of Western Europe became satellites of Moscow, what would be the position of this island?

We have only to pose the question to answer it. We shall not escape from the consequences of such a disaster by seeking in isolation a security which our geographical position no longer gives us. Surely, from this point of view, it will be better for us to play our rôle to the full and use the influence we have for the free development of the life and thought of Europe.

There is also a feeling, and I share it, and it is a serious danger felt by many people, that it would be very dangerous if the United Kingdom, by helping to create a truly united Europe, united in every aspect of its life, were to join in a movement tending to isolate Europe from the world and turn its back on the world and look inwards only upon itself. It may, of course, be that there are some people in Europe who believe that this small but uniquely endowed continent can lead a rich, fruitful and prosperous life almost cut off from contact with the rest of the world.

But I do not believe that such people, if they exist, are to be found among the leading men or the Governments of Europe. Certainly, this island could never join an association which believed in such medieval dreams, but if there are little Europeans, and perhaps there are, is it not the duty of this country, with its world-wide ties, to lend its weight to the majority of Europeans who see the true prospective of events? I believe that our right place is in the vanguard of the movement towards the greater unity of the free world, and that we can lead better from within than outside. At any rate, I am persuaded that we ought to try.

Before I come in detail to the various problems, and there are many—the Commonwealth, British agriculture, and E.F.T.A.—I should like to say something about the method which we will follow. It is contained in the Motion before the House, but I think that it should be somewhat elaborated.

The first and most important point is that any agreement, if reached, will have to receive the approval of the House of Commons. The second is equally important. There will be full consultation at every stage with the interests affected. The consultation must take somewhat different forms. Some of the E.F.T.A. countries may be negotiating themselves in their own right, but we will all work closely together.

With regard to British agriculture, we shall keep very close to the representatives who can speak for this great industry. We shall consult the Commonwealth countries at every level and at all stages. If it is desired by the Commonwealth, we will have a meeting at the appropriate stage either of Ministers or of Prime Ministers, as they may wish. This is really for them. As I said on Monday, no difficulty presents itself here. I said: I have made it quite clear, and so have my right hon 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 decisions were put before Parliament and this country, then I can only say that I would be the first to welcome such a meeting."—[OFFICIAL REPORT. 31st July. 1961; Vol. 645, c. 932–3.] That is the method.

I now pass to the wider issues involved. It is, of course, argued, and with deep sincerity, that by associating more closely with Europe in this new economic grouping we should injure the strength of the Commonwealth. If I thought this, I would not, of course, recommend this Motion to the House. But let us examine the Commonwealth position. We make no binding decisions at the Commonwealth Prime Ministers' meetings. We follow no agreed foreign policy. We have no agreed defence policy. Some members of the Commonwealth are in the various defensive pacts of the free world, and some are unaligned. Yet, for all this diversity, the Commonwealth, although not strictly a political unit, has real life and unity. It is something precious and unique.

I ask myself the question: how can we best serve the Commonwealth? By standing aside from the movement for European unity, or by playing our full part in its development? By retaining our influence in the New World, or by allowing it to decline by the relative shrinking of our own political and economic power compared with the massive grouping of the modern world? Britain in isolation would be of little value to our Commonwealth partners, and I think that the Commonwealth understand it. It would, therefore, be wrong in my view to regard our Commonwealth and our European interests as conflicting. Basically, they must be complementary.

If it is vital not to destroy the influence of the Commonwealth in the political field, and I use it in its broadest sense, it is equally vital to do nothing that would damage it economically. What the Ottawa agreements did was to recognise and to strengthen a pattern of trade which had grown up naturally. It was trade between the old country and the new territories; Colonies in the strict sense of the word, opened up by British settlers as in Canada, Australia and New Zealand. The new countries provided the raw materials and agricultural products; the old country provided manufactured goods. The new countries opened up the territories; the old country provided the capital with which to build the harbours, the railways, and the rest, and sold the manufactured goods necessary to develop the new life. That was the system, and Ottawa formally regularised it.

The system of free entry and preferences has been of great advantage to all the partners although over recent years its impact has been reduced. But at the same time there have been important changes in these last thirty years. First and foremost, British agriculture has been revived and now supplies our country with two-thirds of its temperate foodstuffs and with one-half of all its foodstuffs. All the Commonwealth countries have also developed a wider diversity of manufactured goods, partly for sale at home and partly for export.

As the House knows, this changing pattern of trade has presented us with certain difficulties in certain quarters and they will have to be dealt with whether we enter the Common Market or not. Nevertheless, we recognise to the full our duty and our obligations to the Commonwealth. In the words of the Motion, our aim in these negotiations is to make satisfactory arrangements to meet the special interests of the Commonwealth, particularly, of course, in the economic field.

The same applies to our own agricultural industry, about which I will speak later. I frankly admit that if the structure of the European Economic Community had been going on for a generation or more this task would be not only difficult, but well-nigh impossible. But it has not. It is very new. The Treaty lays down a number of principles, but the working out of detailed policies, especially so far as agriculture is concerned, is only just beginning.

Before I come to consider the particular interests of the United Kingdom, I should give the House an account of the position of E.F.T.A. Our partners in the European Free Trade Association, of course, share our objective of bringing to an end the economic division of Western Europe. They have shown much understanding and sympathy during our consultations during recent weeks, and hon. Members will have noted the communiqué issued by the E.F.T.A. Council at Geneva last Monday. The Council considers that the decision of the United Kingdom to take the initiative which I announced to the House on Monday, and which was followed by a similar statement by the Danish Government, provides an opportunity to find an appropriate solution for all the E.F.T.A. countries and thus promote the solidarity and cohesion of Europe.

For our part, we have stated that arrangements which will meet satisfactorily the legitimate concerns of our fellow-members of E.F.T.A. must be among the conditions for our own entry into the E.E.C. Moreover, all members of E.F.T.A. will co-ordinate their actions and remain united throughout the negotiations. E.F.T.A. will remain in being until the objective of its members has been achieved through the creation of a wider European grouping.

I have spoken of the Commonwealth interests, which are mainly though not wholly in the field of raw materials and agricultural production. In referring to the special needs of this country in the Government's Motion we have very much in mind our own agricultural industry. We have always made it clear that any decision to join the European Economic Community depended upon satisfactory arrangements being made with the Community which would assure the continued well-being of British agriculture. Our objective is to have a prosperous, stable and efficient agricultural industry, organised to provide a good life for those who live and work in the countryside. This represents the fixed decision of the nation. I think that we are all agreed as to purpose. How this is to be achieved is a matter of method.

Methods have changed. In the war and for the period immediately afterwards we operated on the basis of a controlled market and the bulk purchase by the Government of the products of British farmers. We moved later into a different method, of a free market for imports, so as to obtain the advantage of cheap prices, coupled with a system of Exchequer support for the home producer. But even within this scheme there have been variations in emphasis, as in the case of milk, and deviations from the pattern of deficiency payments by the Exchequer.

Our system of agricultural support is basically different from the methods which are being employed on the Continent, and which seem likely to give the pattern of the common agricultural policy when it is decided. We shall have to see what sort of changes will have to be made over a period to bring the systems into line. It may mean that we shall ultimately have to shift from the system where much of the farmers' support comes from the Exchequer to one in which arrangements are made to secure that the market itself provides a fair return to the producer. Such a development would mean much more substantial adaptations in our methods than we have been accustomed to, at any rate in recent years—although our methods have never been static.

I believe that there is a growing realisation that with changing world conditions we are faced with the possibility of changes anyway. But such major changes could be made only gradually, and we should need to see at each stage how they could be so effected as to avoid the risk of prejudice to our main purpose. We are determined to seek such arrangements as will adequately protect the vital interests of our agriculture, but in this we shall not be in opposition to the Governments, still less of the peoples, of the Six countries: nor to the declared aims of the Community respecting agriculture. In our country those engaged in agriculture represent an important—I would even say vital—part, but still a numerically small part of our population. In many European countries they are a very large part of the population, and it is in their interests as well as ours to make sure that agriculture is prosperous.

But objectives and principles are not enough; we shall have to be satisfied that the actual policies adopted can successively achieve what is desired. The purpose of our negotiation will be to see how this can be achieved within the Community. Our view that we cannot carry matters further without formal negotiation applies with special force to agriculture. The common agricultural policy is not spelt out in the Treaty for all to see; it is in process of being worked out by the Six, and by engaging ourselves in discussions with them we should be able to take a hand in shaping it.

We have given a pledge to maintain the 1957 Agriculture Act for the lifetime of this Parliament, and we stand by that. As I have said, our continuing purpose is to have a prosperous, stable and efficient agricultural industry. But we must be ready to examine carefully and dispassionately all methods of achieving that purpose, and if there is the will I do not think that the working out of satisfactory arrangements to meet our requirements should prove an impossible task.

Mr. George Craddock (Bradford, South)

All that the Prime Minister has said applies to all countries throughout the world. Why should we not have this development through the United Nations? That was not set up because nations agreed on the question of peace and war, but because they disagreed. Therefore, why not have its complement in an international authority regulating international trade?

The Prime Minister

However great these dreams may be we must deal with the situation as we find it. We may get a second lift one day, or even a third; meanwhile, let us travel in the lift that is available.

I must now turn to the needs of British industry. The development of the European Economic Community, the opportunity of the mass market which this has created for European industrialists, and the spur that this has given them to competitiveness and efficiency, present the British economy with a great challenge. Whether or not we go into the Common Market we shall have to face the competition of very efficient industries throughout Western Europe, sustained in some cases by populations not yet wholly industrialised. This competition will be severe. The test will be in the straight competition of brains, productive capacity and energy per man. Costs—that will be the test.

The protective tariffs set up before the war have given us some shelter from this competition in the home market. Many people feel that we have perhaps had too much shelter. However that may be, in the long run an island placed as ours is, where our need to export to other people which will always be greater than their need to export to us, cannot maintain the high standards of life that we want for our people in an isolated protective system.

An even more important question is: what would be the loss or gain, not merely of entering a competitive field but of having a common market to develop? In other words, what are the possibilities on the production side? In industries requiring heavy capital investment unit costs are determined by the extent to which the equipment can be used continuously at maximum capacity. With some modern industries, of which the petro-chemical and plastic industries are good examples, the economic scale of production and the capital expenditure involved are so large that the industries can be established and developed economically only with a mass market. It is also true that advanced industrial techniques, such as automation production lines, which can bring great savings in unit costs, are economic only with really large-scale production.

The scale of a potential market also has an important bearing on industrial research. We cannot draw up a precise balance sheet of the prospects for our industries—how much they would gain and how much they would lose—but I think that the weight of opinion among British industrialists is that the balance of advantage for them lies in joining a unit which will be of a size comparable, let us say, to the United States or Soviet Russia.

There are some other aspects with which I wish to deal. The first is what might be called the social implications of the Treaty, such things as movements of population, equal pay and all the rest. At present, the countries of the Six are only beginning what we might call the harmonisation of their social policies. There are very different circumstances in the various countries and, naturally, each one must take into account its own circumstances. So if we joined at a formative stage, as it were, we should be able to bring our own ideas into the common pool with, I hope, mutual benefit.

Meanwhile, it is quite unreal to suppose that we could be compelled suddenly to accept a flood of cheap labour, or to alter the basis of our social security overnight. It is well understood, for instance, that movements of workers would be related by administrative control to actual offers of employment. These apprehensions about the social implications of joining the Treaty are really aspects of a wider constitutional anxiety about what has often been called "sovereignty."

I must remind the House that the E.E.C. is an economic community, not a defence alliance, or a foreign policy community, or a cultural community. It is an economic community, and the region where collective decisions are taken is related to the sphere covered by the Treaty, economic tariffs, markets and all the rest. Of course, every treaty limits a nation's freedom of action to some extent. Even before the First World War there were certain international conventions to which we bound ourselves. Before the Second World War they grew in character and affected both political and social questions, like the conventions agreed at the International Labour Organisation. Since the war this tendency has grown and our freedom of action is obviously affected by our obligations in N.A.T.O., W.E.U., O.E.E.C. and all the rest.

A number of years have passed since the movement began which culminated in the Treaty of Rome and I am bound to say that I do not see any signs of the members of the Community losing their national identity because they have delegated a measure of their sovereignty. This problem of sovereignty, to which we must, of course, attach the highest importance is, in the end, perhaps a matter of degree. I fully accept that there are some forces in Europe which would like a genuine federalist system. There are many of my colleagues on both sides of the House who have seen this at Strasbourg and other gatherings. They would like Europe to turn itself into a sort of United States, but I believe this to be a completely false analogy.

The United States of America was originally born out of colonists with only a few generations of history behind them. They were of broadly the same national origins and spoke the same language. Europe is too old, too diverse in tradition, language and history to find itself united by such means. Although the federalist movement exists in Europe it is not one favoured by the leading figures and certainly not by the leading Governments of Europe today. Certainly not by the French Government.

The alternative concept, the only practical concept, would be a confederation, a commonwealth if hon. Members would like to call it that—what I think General de Gaulle has called Europe des patries—which would retain the great traditions and the pride of individual nations while working together in clearly defined spheres for their common interest. This seems to me a concept more in tune with the national traditions of European countries and, in particular, of our own. It is one with which we could associate willingly and wholeheartedly. At any rate, there is nothing in the Treaty of Rome which commits the members of E.E.C. to any kind of federalist solution, nor could such a system be imposed on member countries.

Here again, unless we are in the negotiations, unless we can bring our influence to bear, we shall not be able to play our part in deciding the future structure of Europe. It may be, as I have said, that we Shall find that our essential needs cannot be met, but if they can I do not feel that there is anything on the constitutional side of which we need be in fear and which cannot be resolved to our satisfaction.

I have mentioned the main considerations which are involved in this great problem, the long-term view of British industry and British agriculture; our responsibilities to our partners in the Commonwealth, our obligations to our fellow members of E.F.T.A.; the future of our national influence in world affairs and the strengthening of the Western Alliance.

These considerations are so important that I do not accept the view that we hesitated too long in reaching our decision. It was absolutely necessary to have the preliminary contacts both on the official and on the ministerial levels and with our friends in the Seven and with our friends in the Six. That has taken some time. It was also absolutely necessary to have thorough consultation with the Commonwealth. Equally, I think that everyone would agree that merely to postpone the decision until the autumn on some excuse or other would be mere temporising.

I have always said frankly to the House that I think that the failure of these negotiations would be a tragedy. Of course it would. If I am asked whether the prospects are now improved, I can only repeat that I am more hopeful than before. The very deterioration of the situation in Europe must tend to increase the forces of unity. There is an old fable of the rivalry between the sun and the wind, as to which could make the traveller discard his coat. As the East wind blows, nations tend to draw together under a common cloak of unity.

It has also been suggested that we should make application on a different basis, perhaps under Article 238, with the object of becoming associates of the Treaty rather than members—"country members" so to speak. We have thought about this and we have found that it would raise all the same problems for British agriculture and Commonwealth trade without giving us any position in which we could share in the decisions of the Community in all its aspects. We have, therefore, come to the conclusion, in the light of the informal discussions, which, as the House knows, we have had over a lengthy period, that the only practicable way to put the question to the test would be to apply for membership under Article 237 of the Treaty of Rome.

I feel sure that European countries realise that there are special problems affecting our position which must be dealt with by special provisions. Indeed, that was their experience when they formed the Six. For instance, special arrangements were made for France's large overseas interests. There were special protocols for Italy, for Holland and for Germany. These were all the subject of negotiation and debate. We must hope that the Six will regard the special arrangements which we require as negotiable in principle and in that case negotiations will begin.

These must, of their very nature, be protracted, detailed and technical. For as well as any matters of principle there is a question of dealing with a large number of separate commodities and reaching agreement on them. No one can be sure that these negotiations will succeed. We hope that the Six will recognise that our decision opens out wide perspectives for future co-operation which could be to our mutual benefit and to the benefit of many other countries, not least those in process of development. We have much to gain from membership of the Community and we have also much to contribute.

A great responsibility lies on the Six as well as on ourselves. Hitherto, although there has been this economic division in Europe, while the rift was there, there has also been the hope of closing it and thus the position has been tolerable. But if it should become clear that this rift will continue and perhaps deepen then I fear that the consequences will be grave. As I said in the United States earlier this year … it will be a canker gnawing at the very core of Western Alliance. I am sure that this consideration is in the minds of our Continental friends.

To sum up, there are, as I have said, some to whom the whole concept of Britain working closely in this field with other European nations is instinctively disagreeable. I am bound to say that I find it hard to understand this when they have accepted close collaboration in even more critical spheres. Others feel that our whole and sole duty lies with the Commonwealth. If I thought that our entry into Europe would injure our relations with and influence in the Commonwealth, or be against the true interest of the Commonwealth, I would not ask the House to support this step.

I think, however, that most of us recognise that in a changing world, if we are not to be left behind and to drop out of the main stream of the world's life, we must be prepared 'to change and adapt OUT methods. All through history this has been one of the main sources of our strength.

I therefore ask the House to give Ministers the authority—not to sign a treaty—but to find out on what honourable basis such a treaty could be put forward for the decision of the House.

4.22 p.m.

Mr. Hugh Gaitskell (Leeds, South)

I beg to move, to leave out from "House" to the end of the Question and to add instead thereof: 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 weakness; and declares that Great 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". I must begin with a personal explanation. Some time ago I accepted an engagement in Canada this week and I was to have flown there on Monday. In view of this debate, I managed to postpone this visit, but I do not think it right to cancel it altogether. If the House, as I hope, does not think me too discourteous, I Shall leave for Canada tonight. Therefore, I am afraid that I shall not be available for the rest of the debate.

There are those who see the problem of whether or not we should enter the Common Market as a clear-cut and simple one. They have no doubts. Some are passionately in favour of our entry and others are equally passionately against, unconditionally in both instances. The pictures they present of what will happen if we follow the one course or the other are so different as to appear to be related to something totally different.

Those who are for are convinced that economically to enter the Common Market will provide our salvation, that we shall be miraculously caught up in the dynamic economy of Europe, that there will be perhaps some transitional difficulties, but that these will not be on a great scale and that when they are over we shall by this means be on the high road to permanent prosperity.

As for our political relationships, they take the view that either we shall retain our political independence in full and our markets with the Commonwealth or—if they happen to be European federalists—they would say that while federal Europe is inevitable we must be part of it and even lead it. Equally, of course, they paint in the gloomiest terms the prospects for us if we do not enter the Common Market, that we are faced then with continued economic decline, that we shall become politically less and less influential in the world. They imply that the Commonwealth, if we really think about it, has no real future and that our very impotence vis-à-vis Europe will contribute to the decline and decay of the Commonwealth.

At the other extreme there are those who hold with equal passion the opposite view. They reserve their gloom for the picture when we enter the Common Market. The economic growth, they say, is a mirage and, anyhow, if there is dynamism in that economy we shall not be able to compete with it. Our foreign policy, they say, will be dictated by others, our ancient Parliament deprived of its authority and our Commonwealth destroyed by a foolish and fatal decision. For them, equally, the picture, if we stay out, is totally different. It is bright with promise, Commonwealth markets can and will expand while Europe languishes and squabbles. We shall go ahead economically and politically while our influence, spanning five Continents, will continue to be strong and beneficent.

Those are the two extreme points of view and both of them, I know, are held by some hon. Members in the House, but I think that the large majority of us in both parties find it hard to accept either of these two pictures. We have not the certainty of the extremists. We feel that whether we accept the one picture or the other depends upon profoundly difficult judgments—almost a matter of guess- work—and that on that account they are inevitably greatly influenced not by cool calculation, but by emotional attitudes. We also suspect that both extremes are wrong, that the issue is not as clear-cut and that a more careful analysis will show that it is much more a matter of balance.

For example, the economic case for going in is said to be very powerful because of the great expansion that has taken place in the Common Market countries in recent years. There is no doubt that there has been such an expansion, but for my part I do not hold the view that this is overwhelmingly due to the Common Market. I think that there are, to any objective observer, other influences at work. For instance, in the case of France—let us face it—the devaluation of the franc was a powerful aid to the expansion of its exports and industry. In the case of Germany, it has been said many times in this House that the emigration from the East has helped West Germany to move faster.

Certainly not every country in the Common Market has been so prosperous and so dynamic. Belgium is mostly at the bottom of these league tables, even below us in production. I do not think that it would be right to assume that merely by the existence of a Common Market—which, when all is said and done, in the early years of the decade was not there at all—this expansion is to be explained. Incidentally, I think that we must also point out—those of us who are a little sceptical of this—that the idea of immense increases in free imports as the great stimulant to our industry does not seem to be borne out by the experience that we have had of freer imports in recent years.

On the other side, I do not think that the political consequences which some fear from our entry into the Common Market are as dangerous or profound as they are sometimes made out to be. I agree with the Prime Minister in that I do not think we are necessarily bound for federalism in Europe. Equally, I think that one can exaggerate all too easily the picture of the Commonwealth prospect as apart from Europe in economic terms. Above all, those of us who take this intermediate position, and who cannot accept either extreme, say that before we make up our minds we must know the conditions.

At least, then we shall have eliminated some of the elements of doubt. At least, then it will be easier to make what will still be, I think, an extremely difficult judgment—for this reason: although there are parts of the Government Motion which we cannot accept, and to which I will refer later, and for that reason we are moving an Amendment to it, yet we shall not oppose the substantive Motion in the Lobby if our Amendment is defeated.

The decision to open formal negotiations has been hailed as historic and decisive. At first glance, it is hard to see why. It is not as if there had not been negotiations before. I am not thinking only of the long period of negotiations of the Free Trade Area, or even of those between E.F.T.A. and the E.E.C. I am thinking of the informal, official negotiations which have taken place for at least six months now between France, Germany and ourselves.

Of course, if it were assumed that the negotiations must succeed, then the Government's decision to enter upon them would be historic, but I think that the Prime Minister will agree—indeed, he has said so—that we cannot assume any such thing. Perhaps, therefore, we had better look upon the present decision as no more than this: as a decision to bring the matter finally to the test.

In any event, it is a noticeable change on the part of the Government, even if the process of change began a little earlier. The Prime Minister, for instance, when he was Chancellor of the Exchequer, in November, 1956, in a debate on this subject, said: 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. 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. He went on to say: We must remain free to continue to grant to this great volume of imports the preferential arrangements we have built up over the last twenty-five years."—[OFFICIAL REPORT, 26th November, 1956; Vol. 561, c. 37–42.] I do not know whether the Prime Minister still stands by that statement, which was made four-and-a-half years ago. If he does, of course, it is very severely limiting the possibility of the negotiations. Even the Minister of Aviation, when he was President of the Board of Trade, speaking in that same debate, said: We cannot enter into a Customs union because that would mean that we should have to put up tariffs, where no tariffs exist today, against a whole range of Commonwealth goods."—[OFFICTM REPORT, 26th November, 1956; Vol. 561, c. 155.] I wonder whether he still stands by that. It is rumoured that he is to conduct the negotiations, or to be in charge of them. It is rather important that he should clear this up, as I hope he will, or that somebody else will on his behalf during this debate.

The President of the Board of Trade said somewhat later, on 28th March, 1958: As the House is aware, we have given a clear undertaking —I repeat, a clear undertaking— to the Commonwealth countries to maintain their position in our markets for foodstuffs, drink and tobacco."—[OFFICIAM REPORT, 28th March, 1958; Vol. 585, c. 793.] Does that undertaking stand? It is important that this should be cleared up.

A little later, on 12th February, 1959, he said: … I cannot conceive that any Government of this country —any Government of this country— would put forward a proposition which would involve the abandonment of Commonwealth free entry. It would be wrong for us and for the whole free world to adopt a policy of new duties on foodstuffs and raw materials, many of which come from underdeveloped countries, at present entering a major market duty-free. I hope that he will bear that in mind when the negotiations about New Zealand butter and lamb are taking place.

The right hon. Gentleman said something else of which I must remind the Prime Minister. He said: Finally, we must recognise that the aim of the main proponents of the Community is political integration. We can see that in Article 138 of the Treaty, which looks towards a common assembly, directly elected. The whole idea of the Six, the Coal and Steel Community and Euratom is a movement towards political integration. That is a fine aspiration, but we must recognise that for us to sign the Treaty of Rome would be to accept as the ultimate goal —to accept as the ultimate goal— political federation in Europe, including ourselves. He added, I think quite correctly: That, as I have said, does not seem to me to be a proposition which, at the moment, commands majority support in this country."—[OFFICIAL REPORT, 12th February, 1959; Vol. 599, c. 1381–82] I do not think it does today, either.

The question whether or not the Government were right to change their mind, if they have changed it, is one thing. But the question of how the negotiations have been conducted over these years is another and one about which I think there can be no doubt, for we, at any rate, think that the conduct of these negotiations from 1956 onwards has been profoundly unsatisfactory. Allowing for all the difficulties—and I am well aware of them—I am bound to say that Ministers on the Government side of the House have again and again committed gross errors of judgment as to what the Continental countries were likely to accept.

When it was plain to a great many people that the French, for instance, had no intention of accepting the Free Trade Area, the President of the Board of Trade went on and on and on with those negotiations, and it was clear that the chances of an agreement between E.F.T.A. and the E.E.C. had disappeared long before the attempt to make such arrangements was abandoned. I must say that I feel some anxiety, in view of the way in which these negotiations have been conducted in the past, that the very same people should conduct the new lot of negotiations now.

There is also, I think, much force in the criticism that if we were to negotiate our entry, as we now intend to do, this should have been done much earlier. Certainly, the economic position today could hardly be weaker than it is. This is one of the points which we make in our Amendment. I heard it said in Europe—I heard it said only last week-end—that we are looked upon as a liability to the E.E.C. if we join and that, therefore, we have no option. [HON.MEMBERS: "0h."] I am stating what I was told in Europe this week-end, by people of very considerable authority. We are, as it were, asking for a shot in the arm. We are dependent on support from European bankers. I repeat that that is what is being said today.

The second reason why earlier negotiations, if we are to have them at all, would have been wiser, is that various decisions have already been taken, and taken in a way which might not have been the case had we begun the negotiations before.

I come to the implications of the Treaty. Until this afternoon the Government have said little about the problems for Britain except that of agriculture. Today, the Prime Minister said a little more about the advantages for British industry. I want to ask only one question, in order that it may be made perfectly clear. Since we have repeatedly said that the great problems were the Commonwealth, E.F.T.A. and agriculture, can we have it firmly laid down that we are still quite uncommitted on all the other aspects of the Common Market which might, or will, affect British industry?

I will give the right hon. Gentleman one or two examples of the sort of thing which I have in mind. The first is the question of capital movement. I do not know how far hon. Members are aware of what the Treaty of Rome says and what has happened on this subject. Under the Treaty eventually capital movements are to be completely free as between the different countries of the E.E.C. Governments can take protective action in emergency, but what they do can be overruled by the Commission or the Council according to the circumstances.

This is a very serious infringement of our own rights to protect our foreign exchange markets, and it happens that it is directly contradictory to the Chancellor's latest proposals in this field, for one of the things which he intends to do—indeed, has done already—is to introduce a much stricter control over the movement of capital from this country to countries outside the sterling area. It seems fairly clear that unless special arrangements are negotiated, the freedom which the Chancellor enjoys today to protect our currency would disappear as soon as the Common Market was in full operation. I should like to make this proposal: I think that we are entitled, as the centre of the sterling area, to ask for a special protocol governing the circumstances in which we may introduce control over capital movement, whatever may be the position in the rest of the Common Market.

There is the question of the Investment Bank. This in itself is an excellent plan by which the poorer, less-developed parts of the community can be helped from a central fund. I suppose that we should have to contribute to it, but I think that it would be fair to say that we have some very serious and heavy obligations to help under-developed countries in other parts of the world, and this, too, is something which should be covered in the negotiations.

There is also the question of the Social Fund which is set up to deal with transitional hardship. I do not want to go into details, but there is one particular part of our agriculture which I should have thought was almost certain to be damaged by our entry into the Common Market, and that is the horticultural industry. I should like to ask whether the Social Fund, if we decide to go in, could be used to assist in dealing with any difficulties which may arise there.

There is the question of a common currency, which is mentioned in various quarters as something to which we must look forward. In my opinion, it is idle to speak about a common currency until there is a common government, and the idea of not being in control of our own currency, and having it subject to a supranational or international gathering, would be quite wrong, and I hope that that, equally, will be made abundantly plain.

I turn to the political aspect of the problem, and I quote again what the President of the Board of Trade said about the effects of the Treaty: … we must recognise that for us to sign the Treaty of Rome would be to accept as the ultimate goal political federation in Europe, including ourselves".—[OFFICIAL REPORT, 12th February, 1959; Vol. 599, c. 1382.] That is not what the Prime Minister said this afternoon. We are entitled to clarity in this matter. In his statement on Monday he spoke of the aim of the Treaty of Rome being to promote unity and stability in Europe, and today he made it quite plain that what he would expect to see was confederation rather than federation.

My view on this is quite clear. I think that there is no question whatever of Britain entering into a federal Europe now. British opinion simply is not ripe for this, and in any event it is surely completely incompatible with all the pledges and promises which have been made about the Commonwealth. I am not saying that we have to commit ourselves for all time, for twenty, fifty or a hundred years hence. There is no reason to do that. But we must be clear that what the President of the Board of Trade said in 1959 is not true and that there is no commitment at all, even to eventual federation. That must be left open. I hope that that will be cleared up beyond any possible doubt in the course of the debate. [An HON. MEMBER: "By our own independent decision."] Yes, by our own independent decision.

I draw the attention of the House, in this connection, to the proposal of the E.E.C. Assembly made in May, 1960, carried in that Assembly, for the setting up of a directly elected Parliament. This is a proposal coming from one of the three organs of the E.E.C., and which has also received powerful backing from the Commission. Where exactly do we stand on that? Is this something that is to take place whatever happens'? What is the attitude of the Ministerial Council towards it? Because, if we have a directly elected Parliament, we have taken a very long step towards a federal Europe, and, I repeat, I do not believe, whatever the future may hold, that at present British opinion is in any way ripe for such a step.

There is another point of great importance. In his statement, the Prime Minister referred to negotiations about changes in the Treaty. Did he really mean changes in the Treaty? What is, I think, allowed under the Treaty is adaptations. This is not regarded in Europe as at all the same thing, but I think that it is of great importance to know—I do not pass final judgment on it at all—whether, for instance, the basic structure of the Community is something that could still be reviewed, or whether it is bound to be the case, if we go in, that the Commission which has this peculiar independent status, being responsible ultimately to the Assembly, but pretty well free in every other way, and very powerful indeed, should continue.

It is very foreign, as I think all hon. Members will agree, to our ideas of the position of civil servants. The Commission is responsible to the Assembly only in the sense that on a two-thirds vote of the Assembly it can be dismissed, but it does not regard itself in any way as under the Council of Ministers. It is an independent body parallel with them. [Interruption.] I think that the Prime Minister is wrong about this, but by all means let us have it cleared up. That is all that I am asking at the moment.

Then there is the question, if the present arrangements continue, of the allocation of votes in the Council and in the Assembly. In a short time now many more decisions will be made in the Council of Ministers by a qualified majority, in effect, something like a two-thirds majority. This is a very important point. If it appears from the allocation of votes that France and Belgium for instance, voting together, are in a position to veto any decision that might be made otherwise by the Council, but we and Denmark are not, then, I think, that would be very unsatisfactory indeed. On the other hand, if the right of veto remains with us, plus one other country—for example, Denmark or Norway; I mention them because they are close friends and they will be coming in from outside with us, if they go in—it removes some of the doubts which many people have.

I do not take the view that one should draw an absolute line between a qualified majority system and the right of veto. Anybody who has had anything to do with international negotiations knows full well that, even where there is a veto, countries work very hard to persuade the country that wishes to stand out and in most cases the country is persuaded. I hope that, even where there is a majority system, the Council of Ministers would hesitate for a very long time before voting Great Britain down, if we enter. Nevertheless, the voting allocation is important and I should like to be assured on that point.

I turn, thirdly, to agriculture. I will say very little about this, because the Prime Minister has covered it. I do not think that it is the major difficulty. I agree with him in this respect. I am not frightened of Continental competition for British farmers, who are quite efficient enough to stand up to it. The people who have to be protected in this case are not the farmers at all, but the consumers. It seems to be far more likely that we shall replace a system of subsidies and deficiency payments with a system of tariffs. That will mean a rise in the cost of living. We should like an assurance from the Government that, if this is so, if this is the only way, they will balance out the saving they make on the Exchequer by reducing indirect taxes, which fall heavily on poor people, and not by making further tax concessions to the wealthy.

I turn to the question of E.F.T.A. The Government have already given a very strong pledge to E.F.T.A., which I read out the other day and which I will not repeat now. It goes much, much farther than anything we have said to the Commonwealth. We must be quite clear on that. It is a pledge that we do not break up the E.F.T.A., which we would have to do if we entered the Common Market and, therefore, will not enter the Common Market till satisfactory arrangements have been worked wit in negotiations to meet the various legitimate interests. and so on. This goes a very long way indeed, and I do not in any way regret it. I think that it was right, but I am sorry that the actual words of this pledge were not incorporated in the Government Motion. We should like an assurance from the Government that they stand absolutely by this.

That is why we have specially emphasised it in our Amendment. We must remember that there are several reasons for keeping relations between ourselves and the E.F.T.A. countries very strong and cordial. It would be a very great tragedy if, at this moment, we were, by our activities, to drive the neutral countries towards the East. It would equally be very unfortunate if we were to offend our closest friends, Norway and Denmark, which are likely to come with us into the Common Market. We must not forget that if negotiations fail we shall still require E.F.T.A., at least as providing something of a large market.

Finally—and, in my view, most important of all—there is the Commonwealth. I do not propose to go into details here. The great difficulty in the economic situation remains. The very idea of switching preferences which have been in favour of the Commonwealth into preferences which are against them is very difficult to stomach. We all know how tremendously important this is in the case of Australian and New Zealand dairy produce and Canadian and Australian wheat.

Let us not forget sugar from the West Indies, either. This is not a purely economic issue. There are moral obligations in this. It would be quite outrageous if, by going into the Common Market, we did things which seriously damaged, for instance, the extremely poverty-stricken West Indies because they lost their preferences in the sugar market.

I welcome this categorical phrase in the Prime Minister's statement: if a closer relationship between the United Kingdom and the countries of the European Economic Community were to disrupt the longstanding and historic ties between the United Kingdom and the other nations of the Commonwealth the loss would be greater than the gain."—[OFFICIAL REPORT, 31st July. 1961; Vol. 645, c. 928.] This is certainly badly needed, because in my opinion a good deal of damage to our relations with the Commonwealth has already been done. No doubt the Ministers who went on these visits did their best. All the same, what came out of them was not exactly encouraging.

The important point I want to emphasise is this. It is all very well to talk about consultation. It is easy to do that. The question is whether the Government will carry the Commonwealth with them. I repeat the question that I asked before. Why should we not give them the same or a similar pledge to that which we gave our E.F.T.A. partners? I know that it will be said that the position will be different and that the E.F.T.A. countries will be engaged in direct negotiations, but, whatever the Government may think, if we do not carry the Commonwealth with us it will have been disrupted. That is why we believe that by far the best way of bringing this matter to the test is the summoning of a Commonwealth Prime Ministers' conference. It would then be possible for the Prime Minister to put the whole thing before them under not unfavourable conditions, as I think he will agree, where it can be looked at as a whale.

I do not say that we could give, or should give, a right of absolute veto on any detail to any member of the Commonwealth. That would be unreasonable. That is why we have said that the conditions should be "generally acceptable" to such a conference. If they are, a great deal of the opposition here and elsewhere to our entry into the Common Market would disappear. Even then, not all of it would disappear. There are some people who would, in any case, be against it. But many of us would be greatly relieved in our minds. On the other hand, if such approval was not forthcoming I doubt whether the Prime Minister himself would be able to carry this country into the Common Market. That is why I think it is the best way of testing the whole thing.

Very much depends on the negotiations which are likely to take place and the spirit in which they are conducted. Very nearly all of us want a closer unity in Western Europe. We recognise the dangers of the present division. We know that it could easily become sharper and more permanent. We accept all that, and want to avoid it, but we want to avoid something else—any action on our part which would precipitate the decay and the downfall of the Commonwealth. Somehow or other both these dangers have to be avoided.

I am encouraged by the declaration of the Six at the W.E.U. meeting, which has been published this morning, that they attribute the greatest importance to the links with the Commonwealth and that it would be contrary to the interests of the free world to weaken them. I hope that they will draw the practical conclusions from this statement, both in the economic and political fields.

I hope that Her Majesty's Government, despite our economic weaknesses, will not approach these talks in any way in a suppliant mood, nor, on the other hand, with any idea of dominating Europe. That is not the best way to enlist the support and help of other European Governments. I hope that they will not try to solve this problem by clever formulae which are interpreted in one way by the E.F.T.A., in another way by the Six, and in another way by the Commonwealth. I hope, above all, that they will remember that the greater unity of Europe cannot be given a firm foundation on suspicions and fears in Great Britain, on anger and dismay among our other European friends, or on bitterness and disillusionment in our great multi-racial Commonwealth, of whose development we are all so proud.

4.59 p.m.

Sir Derek Walker-Smith (Hertfordshire, East)

I am grateful for an opportunity to take part in this momentous debate, for it is certainly a momentous one. It is not just a debate about the Common Market, important as that is. It is not just a debate about economics, important as they are. It is acknowledged that it raises great political issues: issues which concern our constitutional practices, our national institutions and our future as a sovereign State.

Because of these issues it is necessary, when we are discussing the economic aspect, to see the matter as a whole and in its long-term implications. We cannot in this matter be content with the modest asseveration of the hymnographer. We must ask to view the distant scene; for one step in this case might be far too much. It might, indeed, be fatal if we do not know the direction and destination in which it is leading us.

I believe that we have made progress in the last few months, progress which is illustrated by the terms of the Government's Motion. It may be that, relatively recently, the Motion would have been phrased in rather different terms. It even includes the word "sovereignty". A little time ago I began to think that perhaps this was a dirty word or, at any rate, a forgotten thing.

These political issues have two distinct, but related, aspects. First, the longterm implications of sovereignty and, secondly, the context of the defence of the free world against Communism. Most of my speech will be directed to the first, but I recognise of course the importance of the second. We understand that the Soviet would rather that we stayed out of the European Cornmunity; and there may be hon. Members for Whom that is a reason, or an additional reason, why we should stay out. If so, I am emphatically not one of them. Rather the reverse, for I put Soviet advice in the category of Grecian gifts. If it were Shown that it was indispensably necessary to the defence of the free world, then that would be a different thing. But that is not the case that has been put, or has ever been put; and it would seem, at the least, an unlikely proposition that in order to counter the menace of a monolithic society one should create one for oneself. Surely that would be pushing, to extreme, the principle of by Beelzebub, cast out Beelzebub.

If the proposition that it is indispensably necessary to the defence of the free world were true now, why was it not true earlier—last year, the year before or even the year before that—When this matter was being dealt with? Further, I would submit that this is contrary to the teaching of history, which is that democracy draws its strength in no small measure from the native vigour and individual genius of countries freely co-operating on the basis of national sovereignty.

In everything I say it is inherent and implicit that we have a supreme duty in our contribution to the defence of the Western world against Communism, but that that duty is better discharged by the courses I shall venture to counsel.

Against that background I come to the question of sovereignty; and here again we must look at it from two points of view. First, the derogation of sovereignty which arises expressly from the Treaty of Rome; and, secondly—and inescapably—the consequences of those contemplated further arrangements on the part of the European Community, acceptance of which would be implied by our adherence to the Community now. I shall adduce later my evidence for this second proposition; but, first, I shall devote a word to the first matter—the direct consequences of the Treaty itself. Time and a naturally kind disposition will prevent me from burdening the House with detailed references to the Treaty. Hon. Members will have in mind the content of Article 3, which lists the functions of the Community, and paragraph H of that Article, which requires the member States to aproximate their municipal law—which is international law phraseology for national law—to the extent necessary for the functioning of the Common Market. Thus there is some immediate surrender of sovereignty expressed in that.

The question is not whether the matters in respect of which sovereignty is surrendered are good or bad. The question arises: in so far as they are good, could they not be achieved by the ordinary methods of international agreements entered into on a basis of sovereignty? We know that in some cases the answer is "yes". It is "yes" in regard to the elimination of quantitative restrictions and the lowering of tariffs. Of course, when one comes to the question of a common external tariff against third parties, that is a different matter. That is a supra-national consideration; but that is one of the things we do not want because it impinges upon our obligations to the Commonwealth.

Then there are the other matters to which the right hon. Gentleman the Leader of the Opposition referred, such as the control of capital and services. Is it right and safe for us to surrender this control? We are not merely a European power but the centre and chief banker of the sterling area.

Then there is the question of the control of workers. My right hon. Friend the Prime Minister paraphrased the Treaty; but let hon. Members remind themselves of the provisions of Articles 48 and 49 in respect of the control of workers. They are precise and mandatory and they get rid of national discrimination in respect of employment. This may be a liberal philosophy, and it may be very good in times of full employment; but what if depression comes? What is to happen at the ebb tide to those who came in at the flood?

Against this derogation of sovereignty some will say that there is a substantial economic advantage; but we have seen no real economic balance sheet. We can assume that there would be some economic advantage, in particular to those large, dynamic, and progressive concerns in respect of which our main hopes of expansion lie. But we can equally feel that there would be some economic detriment, particularly to the smaller industries and to the horticultural industry. I do not propose to deal with these special matters today, because I want to concentrate on the broad central theme. We are told that, economically, competition and the need to be competitive is the keynote.

Of course, no one would suggest that by not joining the European Community we can insulate ourselves from the necessity of being competitive in Europe. That would be to pursue the policy of the ostrich, which is notoriously as ineffective as it is inelegant. Competition for us in this small and crowded island is not a matter of choice. It is something imposed on us by nature, by geography, and by inescapable circumstance. It is as natural to us, and should be as bracing, as the air we breath. I find something humiliating in the proposition that the only way to bring economic realism to a great industrial people is to join the Common Market.

The true test is not to measure the potential, under a European Community, with the actual now. The test is to measure the potential under the Community with the potential under other arrangements. Particularly is this true of our Commonwealth arrangements. One cannot set 1961 European arrangements against 1931 Commonwealth arrangements eroded by circumstances and G.A.T.T.

We have a duty to review and revise these arrangements so as to get the maximum economic co-operation possible in the conditions of the times, and to negotiate, if possible, any necessary revisions of the G.A.T.T. That is the effort that we have to make. It will mean tough negotiation. Of course it will, and not only in the G.A.T.T. but tough negotiation with some of our Commonwealth partners. I have been a Board of Trade Minister, and I do not take just a sentimental view about these economic matters. The effort must be made and made with vigour, faith and force.

My right hon. Friend knew that we were interested in the terms of reference and the activities of the three Ministers who went on the Commonwealth Odyssey, but we have not heard what they did. Did they go, among other things, as prospectors of new seams of economic Commonwealth co-operation? Or did they go only as bagmen of the Common Market?

I turn, then, to the question of the long-term implications in regard to sovereignty; and I say with confidence to the House that we are not justified in looking at this purely in the narrow context of the direct results of adherence to the Treaty of Rome. We have to look at it from the point of view of the wider implications of the long-term effect in relation to our sovereignty and our constitutional machinery. I say that, because I believe that is what the evidence is. Time forbids any exhaustive adducing of evidence, but perhaps I may be permitted to cite four very brief extracts from the introduction to the Third General Report on the Activities of the Community, the latest we have, placed in the Vote Office by the courtesy of my right hon. Friend the Prime Minister in response to my request. Page 16: The Community is not simply a trading agreement or an economic agreement, but one element in a wider political construction… Page 17: … a proposal made by the Commission … is an autonomous political act by which the Commission speaking with complete independence, expresses what it considers to be the general interest of the Community. Page 24: … the Commission wishes to emphasise the political importance it attaches to this acceleration. The internal strengthening which it proposes … is intended to reinforce, by leaving behind national divergencies, that movement towards union which the Six States began when they signed the Treaty of Rome. Finally, on page 25, it is stated that the Commission hopes that the Six will assemble their forces in order to make a reality of economic Europe while laying the firm foundations of political Europe. And for good measure, if hon. Members will look at the next two pages they will see that the word "political" figures no fewer than five times. Is not that evidence that for the Community economic union is a prelude to political union?

Let me make this clear. I make no sort of reproach to the Community for having this intention in mind. I would associate myself with no derogatory observations that might be made at this or any other time about the Community or the six nations that compose it. On the contrary, I have a high regard for the ability and integrity of the gentlemen who administer the affairs of the Community. I respect, as I believe every objective person must, the leadership which has lead some of these countries from the slough of despond to the firm plateau of their present position. Above all, I salute—and all should seek to share—the sense of Christian purpose which animates their aims and aspirations.

If this be so, why should we not hasten to join this goodly fellowship? I will give the House the answer. It is, of course, this: that what may be good for them is not necessarily good for us. The reason for that lies in our history and institutions and in that special and separate position which time and the toil of our forefathers have built up for us. To refer to our special and separate position is not to take a narrow or parochial view. It is from that special and separate position that Britain has served the interests of Europe and of the world over the centuries and has contributed mightily to their well being. It is on the basis of that special and separate position that our greatness has rested.

Are we now to be told that the time for that position has passed? Shall we be told that the time of our greatness has passed or is passing too? I believe that a glance at history helps to get this matter into perspective. Sovereignty came late to most of the nations of the Six. They were part of the Holy Roman Empire, that physical embodiment of the mediaeval law of nature which preceded the formalisation of the modern doctrine of sovereignty. Our national sovereignty did not follow that doctrine; it preceded it. We were practising national sovereignty and evolving our Parliamentary institutions and our common law when others were looking to Europe. The sovereignty of Parliament and the rule of law are for us the twin pillars of our Constitution and our way of life. For the Six, Parliament has its roots less deep; and perhaps the institution is held in less high regard generally than with us. We evolved our own common law. They preferred the general acceptance of Roman law.

The Six share their constitutional outlook and practices with each other, but not with us. Their evolution has been Continental and collective. Ours has been insular and imperial. Therefore, for them political union would be a reunion and a rediscovery, while for us it would be a departure and a divergence.

I do not say that the pattern of the past can never be varied. I know, of course, that we are living in a fast-moving modern world in which science is daily shrinking distances and approximating frontiers; but I do not believe that these physical factors can render obsolete the constitutional heritage which the native genius of our forefathers has bequeathed to us. Still less do I believe that it would be right to sacrifice it as a sort of postscript to an economic arrangement. These are not matters which can be decided simply by the test of tariffs or in the terminology of trade.

There are considerations here which go beyond the considerations of the counting house. They involve the past and the future of a great people. These considerations arise inescapably and they arise now, and my right hon. Friends must ask themselves and answer questions such as these. If we adhere to the Economic Community now and the Six proceed, as they are entitled to proceed, to the next stage of political union, what then is our position? If we do not want to go along with them on the political side, could we stay in on the economic side, or could we get out at that stage even if we wanted to? Or is the real position this, that if the decision is taken now we forfeit the power of political decision? And what is the intention of the Government in this regard? Do they want to take a step forward into political union or not? So far we have not had an answer to that question. If we tried to come out of the Community in those circumstances, would not the Six be justified in saying to us, "But you knew all along of our enthusiasm for the next political step. If you did not share it, why did you join us in the first place?" Then the last state of our relations with Europe would be worse than the first.

With respect, I conclude with a word of counsel and exhortation to my right hon. Friends. First, a few words on what they should avoid. Avoid any temptation to blink or to mask the long-term implications of this decision. They would catch up on them in the end. Avoid any temptation to rush into a decision in a matter which has taken a longish time on the road. Avoid at all costs any sophisticated exercise in seeking to ease us into political union in the wake of economic union. Avoid taking the responsibility of putting us in the position of having to say at any stage, reluctantly but resolutely, "We can have neither part nor lot in the thing you seek to do." In this matter there is a high responsibility; and it rests not on the Government alone but jointly and severally on every Member of this House.

Now what to do. Tell the Six that we wish them well and that we want the maximum co-operation with them which is compatible with our own independent sovereignty and duty to the Commonwealth. Remind them of the difference between our position and theirs, and tell them that we do not wish to renounce our heritage but to use it for the common good. Seek an association with them under Article 238 of the Treaty which can bring the maximum honour and advantage to all. Try for a closer association with the Commonwealth, both economic and political, stressing the importance to those who need it of truly democratic institutions in our Commonwealth system. Remind our people that we are the guardians and the propagators of great principles and the centre and prime inspiration of the Commonwealth. Ask them for an effort to make these things a living and dynamic force in the world today.

If my right hon. Friends take that course, they will do well; and I believe that they will give a great stimulus to our people, and will bring to them the sure hope and strong conviction that, God willing and we deserving, the best is yet to be.

5.23 p.m.

Mr. A. Woodburn (Clackmannan and East Stirlingshire)

We have listened to a very interesting speech by the right hon. and learned Member for Hertfordshire, East (Sir D. Walker-Smith). It reminded me of the custom in the church under which, before a person is admitted to certain places, a devil's advocate is heard who states all the arguments against the admission of that person. We have had a most efficient speech from the right hon. and learned Gentleman which presented all the arguments against our entry into a united Europe.

It appears to me that we must approach this matter in one of two ways. As my right hon. Friend the Leader of the Opposition said, there are those who favour every argument for not going in and for keeping our independence and there are those who favour every argument for going in. I must confess that I think in terms of trying to get greater and greater unity, not only in Europe but eventually in the world, and, if possible, world government. We on this side of the House have committed ourselves to this as the ideal which will establish peace throughout the world. We must have some world regulation of affairs by law and order if we are to preserve peace and not have nations settling their disputes themselves. The argument of the right hon. and learned Gentleman is that every man must be independent and must make decisions for himself unless he can come to agreement with others. But, if we are to co-operate with others, there must be some surrender of sovereignty.

I am satisfied that, however much we should like to be in a stronger position in our approach to European unity, we in this House are playing a part in one of the most dramatic moments of our history. I do not believe that the Government have gone thus far without having some idea of where they will finish up. I am satisfied that the Government are not going ahead in order to fail. They have made sure to some extent that they will succeed, and the declaration of the W.E.U. reported this morning seems to confirm my impression.

We are discussing the end of Britain as a key unit in the world. We are crossing the threshold and taking part in one of the greatest economic combinations of the world. If we enter the Common Market, Europe will be the greatest economic organisation in the world, bigger than either America or Russia. It could not be expected that such a change could even be proposed without raising strong emotions, and even violent opposition. The Prime Minister is not faced with the desperate life and death situation which existed when the right hon. Member for Woodford (Sir W. Churchill) offered, with general consent, common citizenship with our country to the French. But evolution means that change has to come. Change has always been a condition of survival.

Clearly, the Government must have been moved by some irresistible pressure before they reached the conclusion which they have announced. No Government, except a Socialist one, on grounds of theory alone, comes up against all the prejudices of people to propose change for the sake of progress. The Prime Minister has not wholly given the reasons behind the Government's decision in this matter. I am satisfied that something much greater than we have heard so far has moved the Government to take this decision. Conservatives do not want change on principle. They like things to remain as they are, a view which the right hon. and learned Member for Hertfordshire, East clearly expounded. They are not pioneering, as the Labour Party is pioneering, to change the world to the kind of world that we think it should be.

What has compelled the Government to take this decision? We gather that it must be either the pressure of the possibility of war, which certainly compels change, and the need for European defence, or that some desperate economic situation is pressing them to go ahead. I am sure that, in addition, there must be the fear and knowledge that if we refuse to go forward as part of Europe our prosperity and well-being is, relatively speaking, doomed to decline. In short, we can continue to count in the world only as part of Europe. That would seem to me the dominant factor in the Government's decision. Standing alone, the bus of progress would pass us by. In this case, necessity is the mother of change and I am sure that the Government must have thought that there was no other course than this one if our country is to survive.

After the First World War, it was commonly assumed that the first and greatest step towards peace was to have a United States of Europe. I remember that early text books contained maps with a United States of Europe outlined, but, as people recovered from the war, this ideal gradually faded away and after the Second World War it was not revived. The unity of Europe was regarded as one of the hopes of people. Now we look forward eventually to world government based on the acceptance of law. Such a development is clearly important if we are not to remain insular "Little Englanders", refusing to mix with foreigners. In fact, we have long built up a high standard of life by trading with people of every race and colour in every part of the world.

The terms of that association with other peoples must either be agreed or dictated, and the time for the domination of other peoples has gone by. This means that we must give and take and have some surrender of sovereignty, for all co-operation involves compromise. In any case, the idea that at present, by standing alone, we are masters of our own fate cannot be sustained in the face of reality, and I think that the speech of the right hon. and learned Gentleman in this regard was self-delusion. It cannot be sustained in the face of the facts.

It was Britain that inspired the move towards the Common Market. The right hon. Member for Woodford (Sir W. Churchill) and the present Prime Minister and some of his colleagues, who were outside the Government at that time, went to Europe, and, however much embarrassment they caused to us who were in the Government here, there is not the slightest doubt that they inspired the people of Europe to want unity and to become Europeans, instead of Germans, Frenchmen, Belgians, Dutchmen and others. The Government of which I was a member were compelled to take a more practical line, and it was very embarrassing to us for these activities to be taking place on what seemed to be a very romantic and idealistic line of progress.

The right hon. Member for Woodford rapidly became one of the great heroes of Germany, and not very long after the war had finished, his visit to Aachen was proof of this, when they invited him to receive honours which was a most remarkable transformation. There was no question of the inspiration. Unfortunately, they inspired a great many people into thinking that Europe could be united overnight, and could become federalist under one united Government on a democratic basis, based on the sovereignty of the whole of Europe.

It is this idea of federalism which has been imported into the Treaty of Rome, which has alarmed a good many people here today and has alarmed a good many people in countries inside the Common Market. In any case, if we are to go forward, we have to go forward on practical lines. Ernest Bevin suggested the scheme that became Marshall Aid, which, together with Britain's help, put Europe back on its feet. We thought it better to build on the foundations of already existing institutions and through existing Governments. The United States expressed its willingness to help, if Europe united in efforts to help itself.

The United Kingdom and France invited all the European nations to a conference on a programme for European recovery, and sixteen nations formed the Organisation far European Economic Co-operation. It is rather interesting now to read the declaration of O.E.E.C. as to the purpose to which this nation and all the others had committed themselves: To join together to make the fullest collective use of their individual capacities and potentialities. To increase their production, develop and modernise their industrial and agricultural equipment, expand their commerce, reduce progressively barriers to trade among themselves, promote full employment and restore or maintain the stability of their economies and general confidence in their national currencies. Common economic problems were to be studied jointly, and each Government was to submit to other countries budgets, investments and a balance of payments.

Quite clearly, that was to a large degree a surrender of sovereignty, although it was not put in legal form, nor did it become a permanent institution that could not be withdrawn. It was a wonderful lead, and out of it came a long series of united activities which led up to the Common Market, and therefore, to some extent, Britain was responsible for the steps that are now taking place in Europe.

Why, therefore, did we step aside? I think the first important step was our refusal to join the Iron and Steel Community. As a Member of the Government Which took that decision, I have to accept some responsibility, but, unfortunately, the terms of the invitation appeared to make it quite impossible for us to accept. We may have been wrong. Looking back on it, we might have done better to have paid no attenion to the terms of that invitation and to have relied on ourselves at the meeting to make the conditions different.

Mr. A. R. Wise (Rugby)

There is one effect which that would, unfortunately, have had. If we had joined the Iron and Steel Community, we should be paying £ or £4 10s. per ton more for our steel.

Mr. Woodburn

The hon. Gentleman thinks that we were right not to join, but it may be that that would not have been the case if we had joined. That is pure speculation on my part and his. In any case, it was at that decisive moment that we withdrew from this progress towards the unity of Europe which we had done so much to inspire and foster.

It is obvious that the Government are not to be deterred this time by the terms of the invitation or the terms of the Treaty of Rome. I understand that the invitation to discuss the Coal and Steel Community was couched in these terms deliberately through the influence of M. Monet in order to keep us out. There are some people on the Continent even today who do not want us to go into the Common Market. We are told that General de Gaulle has been voicing deterrent conditions of this kind, and, quite clearly, the Government have decided to ignore them and to face the negotiations which they will enter. Some of General de Gaulle's advisers do not want us in and have been saying so, publicly and privately. They are creating the impression that they represent the whole of France, but, actually, there are a good many people in France who do want us in.

France itself, and even General de Gaulle, is rather anxious, for certain purposes, that we should be in, though they may object to us on some grounds, and General de Gaulle is very anxious on the points which my right hon. Friend and the Prime Minister raised—the question of help for under-developed nations outside. France is having considerable difficulty in persuading fellow-members of the Common Market to have any responsibility in a United Europe in helping the under-developed nations which were formerly colonies of France, and France would welcome our outlook on that. There is no doubt that we shall be able to join them in fostering the development of under-developed countries abroad.

There are other people in France who would welcome us in. A good many influential people in the Six, however, are apprehensive about our coming in. It is not that they would not like Britain to join, but many say that they were let down by Britain in the past. They felt that the Prime Minister and the right hon. Member for Woodford were passionately advocating united help when not in the Government but that immediately they came into office they forgot all about this enthusiasm and the people of the Continent felt that they had been letdown. It revived all the suspicions about "perfidious Albion", and today there is a good deal of suspicion among people who otherwise would like us in that the only reason why we are willing to come in is to prevent the progress towards a better unity even among the Six. They think that if we go in, we shall sabotage the existing unity and hold the thing up. I think they are a little romantic about the rate of progress that can be expected, but the true feeling is that if Britain goes in we shall slow down the pace of development.

I heard M. Spaak at a conference some weeks ago—and he is one of the people with whom the Government will have to negotiate—actually making this declaration: We went ahead on our own. We decided that it was better to go somewhere without Britain than to go nowhere with Britain. That is the attitude of M. Spaak, and he takes the view that if we go in, far from helping the Common Market we shall actually sabotage it and prevent progress.

Mr. William Yates (The Wrekin)

But did he not also say that Europe had suffered so tragically since the war that she could not sustain a European Common Market without Britain with her?

Mr. Woodburn

I heard him three weeks ago making this statement, which was not very friendly to the idea of Britain joining, and I am very glad to hear that he has expressed a different view when speaking elsewhere.

This is the most likely kind of opposition which the Government will meet—the fact that if Britain joins, she will slow down the pace of development. A good many people on the Continent want. this Parliament of Europe elected by direct suffrage, and I understand that we are fully protected in the Treaty of Rome by the fact that progress of that kind could only be obtained by unanimous decision and not by a majority.

It is difficult to prevent people rationalising in a controversy of this kind and to look for arguments which will support their preconceived judgment. We are told that if we enter the Common Market we shall give up our sovereignty to Dr. Adenauer and General de Gaulle. But any development towards political unity or political federation would involve a sacrifice of the sovereignty of other countries as well as of our own. We are told that this is the thin end of the wedge which will split us off from the Commonwealth. But history shows that thin ends of the wedge are never driven home. That is an old story.

As to sovereignty, does anybody believe that we are a wholly sovereign State today? The definition of a State by Jerks has been given as an association of people under one military command. In earlier days that meant a king. If not in law, certainly in fact we are no longer under our own military command. We are under N.A.T.O. for defence, and no one can conceive of any country standing alone in the matter of defence.

Mr. Wise

If we are under N.A.T.O. command, will the right hon. Gentleman explain what N.A.T.O. has to do with our operation in Kuwait?

Mr. H. Hynd (Accrington)

What has that to do with defence?

Mr. Woodburn

It is impossible for this country or any other country in the West to defend itself alone, and for defence we have sacrificed our command to N.A.T.O. I thought that was the policy of the present Government, and of all hon. Members opposite. Last week I heard the French Minister of Defence state that anything less than Europe as a defence unit was not conceivable—

Viscount Hinchingbrooke (Dorset, South)

Defence against what?

Mr. Woodburn

Our exchanges are now conducted in co-operation. Britain is linked up with Euratom and a great number of European organisations, all of which in practice limit our sovereignty. We live in a Europe of interdependence, not independence.

What would be the sensible development of European co-operation? There is no reason to think that complete federation is either practicable or desirable. Our own history illustrates this. Our organs of government each do what they are best fitted for. Parliament delegates the functions of government locally to town and county councils. It is found convenient to allow Scotland, Ireland and Wales in various ways to discuss matters not concerning the United Kingdom as a whole. Parliament could easily become choked if it attempted to deal with every local problem. But it is essential that the British Parliament should deal with matters which affect the whole country. Europe now has questions to answer which cannot be dealt with in any one country, and surely, eventually, there must be some European Government and Parliament to handle these problems.

Defence is the clearest case for a civilian authority to control the military unity, and this will be necessary sooner or later. The military force is impotent without an economic basis for its operation, and this calls for European government decision sooner or later. There are other lesser issues which need European law and not national law, whether it is in the form of the combined Heads of Government such as N.A.T.O. or other forms of government. One example is the regulation of fishing grounds and limits. It is one of the bugbears for even this Parliament that nobody can control fishing fleets of European countries fishing in our waters, and surely common sense would dictate that there should be some European body to establish law in this respect. Agriculture cannot be left to chance, and sooner or later we shall need European and even world planning.

This raises the question of the Commonwealth. It would not be possible to divorce us from the Commonwealth. We are told that there are 20 million Scots and large numbers of Welsh and English abroad, and that they have ties with this country which no amount of arguing will break. But they are all hard business men. The fact that they are Scots, English and Welsh does not mean that they will pay more for goods coming from this country than they would if they went to the Common Market. With the Common Market, economic development is such that even a 20 per cent. tariff could not protect us against the advantages of mass production and automation which is made possible by a 200 million population market on the Continent. Therefore, we cannot dictate to the Commonwealth that they should buy their goods here.

I used to be in commerce in the days when Australia bought all her goods in this country, and I remember when, because the steel masters arranged a monopoly price for steel, Australia went to Switzerland and other countries on the Continent for her railway material and thus did away with a great British monopoly.

It is nonsense to say that the Commonwealth buy all their goods here. They do not intend to do so. But that does not mean that there is any break in relationships and friendship, so far as economics make it possible, between ourselves and the Commonwealth. The European countries recognise that the accession of Britain with the Commonwealth is a greater asset than Britain without the Commonwealth. Naturally each country wants to safeguard its own citizens, but I am sure that the Common Market countries will make every provision so that Britain can come in with the Commonwealth. They have already shown great flexibility in their own discussions and mutual adjustments.

What will not be acceptable to any of them is that while we refuse to make any concessions, we want all the benefits that come from membership of the Common Market. They are not going to agree to Britain having its cake and eating it and taking all the benefits while making no concessions in return.

It is vital to political progress that political administration should keep pace with technical development. Mass production, automation, electronics and atomic energy have provided us with powers to produce wealth which cannot be contained within present national frontiers. We are already bursting at our economic seams in many cases.

Air travel has made modern barriers ridiculous. I can recall how housewives in the old days used to have to stop at the gates of Paris, open their bags and have them examined by octroi or customs officials, to see whether they were taking any contraband in or out of Paris. The present customs arrangements at our own frontiers and the frontiers of Europe are just as ridiculous an anachronism. The customs officials can hardly cope with the traffic which goes through. The examination in many cases has to be very much a spot check here and there. The sooner we can make arrangements for Europe to get out of that nonsense the better. As Ernie Bevin said, What we want to do is to be able to make arrangements, at least in Europe, where we can buy a ticket at the desk and go where the hell we like." That was his philosophy as to how we should develop liberty and freedom in Europe.

Surely moves to free ourselves from useless handicaps must be good common sense, and I hope that. the Government, in addition to all these deep economic considerations, will get down to dealing with some of these common sense problems that irritate people who want to mix with their fellows on the Continent. The Government are faced with a great responsibility, but they are equally faced with a great opportunity. Whatever may be the reasons which have impelled the Government to make the move towards uniting with Europe and however much the background may lay them open to criticism and controversy, no one with a sense of history can fail to feel the drama of our crossing this threshold into a new and uncharted future.

When Scotland and England united their Parliaments, the Commissioners were abused and reviled for selling out their national independence for a seat at the table of the English colonial trade. The right hon. and learned Member for Hertfordshire, East reminded me of some of the speeches made before the union of England and Scotland. Today, after 250 years, there are still those who denounce the Union as treachery and who want to turn back the clock. Even in this House there are some who do not give what might be called a hearty welcome to the Scots in their presence here. But the fact is that, with the Union, Scottish and English prosperity moved forward by leaps and bounds, and the United Kingdom has never looked back since. I question whether any voluntary union in history has ever been more fruitful and productive than the union of our two peoples. While we may tolerate, without loving, each other, I believe that even this Parliament would lose something if the Scots went back to their own country.

It is difficult to foresee the future, but I am satisfied that 250 years from now there will be people denouncing this Parliament and Government if we do unite with Europe. Nevertheless, the Government must go forward in the knowledge that they have in their hands responsibility for the prosperity of our country. We shall watch with interest the progress of their move, in the hope that reason and good will may take us one step forward towards the unity of all mankind.

5.52 p.m.

Sir Lionel Heald (Chertsey)

I know that many Members in all parts of the House wish to speak on this matter, and I think it is necessary that as many as possible should speak in view of its tremendous importance. I hope to be brief, therefore, but I feel that it is one's duty to try, if possible, to identify and clear up any misunderstandings and confusion which might arise in the debate if we do not keep our eye on the ball and bear in mind the real question before the House today.

When he made his statement the other day, the Prime Minister said something which I shall repeat because I believe that to do so will be of assistance to us all now. My right hon. Friend said: We have reached the stage where we cannot make further progress without entering into formal negotiations. I believe that the great majority in the House and in the country will feel that they cannot fairly judge whether it is possible for the United Kingdom to join the European Economic Community until there is a clearer picture before them of the conditions on which we could join and the extent to which these could meet our special needs."—[OFFICIAL REPORT, 31st July, 1961; Vol. 645, c. 930.] The speeches of the right hon. Gentleman the Leader of the Opposition and of my right hon. and learned Friend the Member for Hertfordshire, East (Sir D. Walker-Smith) contained much food for thought but they contained also a good example of what the Prime Minister had in mind. I refer to the matters they discussed upon Which we cannot arrive at any conclusion until we know what it is possible to obtain in the way of terms by means of negotiation.

No one can logically vote against the Government Motion today unless he is prepared to maintain that, as a matter of principle, in no circumstances should we join the Common Market, whatever terms we might obtain. That issue should be faced by everyone who speaks or votes in this debate. I can understand such an attitude, although I cannot accept it. It is a perfectly honest and straightforward attitude, based in very many oases on a great ideal—what used to be called Empire Free Trade—the champion of which has always been Lord Beaverbrook. No one who knows Lord Beaverbrook could fail for a moment to appreciate and admire his abiding faith in that conception, although I must say that some of us find it rather difficult to admire the methods adopted by his newspapers in supporting it, particularly when they make very selective and partial quotations from the Treaty of Rome and when in their leading articles they offer intimidating and terrifying threats about what will happen to Members of Parliament if they do not do what they think they ought to do.

We must face the simple truth. Unfortunately, a Commonwealth common market is not possible. This cannot be said to be the fault of the British Government, or, at any rate, the fault of any British Government alone. Many of us have had long and interesting talks with friends from Canada or Australia and have learned from them that, much as they would like to see something of that kind, there are insurmountable obstacles in those countries against its attainment. Let us make no mistake about it: we cannot hope that it will ever be possible.

There is another way of looking at the matter which is really part of the same point of view. As Lord Beaver-brook has perfectly frankly and honestly always accepted—one has seen it said time after time in his newspapers—to vote against this Motion involves the view that for practical purposes we should take a decision in favour of the permanent isolation of Britain from Europe. This, again, is a view held by some people. I believe it to be wrong. But, unless one is able to take that view, how can it be justified not even to attempt to join the European Common Market? If we were to say now what some people have suggested we should say—" Let us wait five years and see what the position is"—within five years all the major decisions of policy will have been made and we shall have had no say in them at all. Let there be no mistake about that. Moreover, as my right hon. and learned Friend the Member for Hertfordshire, East pointed out—though I must say that I do not agree with some of the views he expressed—there is the political future also to be considered. The concept of splendid isolation was very attractive fifty-five years ago when the phrase was first coined.

Mr. Wise

Fifty-five years ago we were negotiating the Entente Cordiale.

Sir L. Heald

I am much obliged to my hon. Friend for telling me that, but I was talking about the phrase and, at the risk of repetition, I will say that I believe that, if we were to decide now that we should adopt a policy of isolation in relation to Europe, there would, in 15 or 20 years, be nothing very splendid about it in trade or in any other sphere. Let us remember, also, that after the 1914–18 war, this was, unfortunately, the approach of the United States to Europe, and it was, perhaps, one of the biggest negative causes of or contributions to the Second World War.

Again, I feel that there is some misunderstanding about the actual machinery. The application to join is a necessity, arising out of the form of the Treaty itself. Informal discussions can, of course, always take place at any stage but, according to Article 237 of the Treaty, a formal application is essential as a preliminary to negotiations for the necessary agreement which has to be entered into when any new member joins.

On this, I support the Prime Minister's view that the realistic situation must not be obscured by technical arguments of whether a word means "amendments", "adaptations" or what. No special provisions are required in any treaty in order to allow the participants to vary it, or add to or subtract from it. After all, it is one of the most elementary principles of the law of contract of any country that those who make an agreement may vary it or add to it by mutual agreement.

In any event, important changes must be made under Article 237. As has been already mentioned today the voting machinery must be changed—and what an important matter that is, as my right hon. and learned Friend has already pointed out. The qualified majority which subsists under Article 148 (2) at certain stages has to be rearranged. Who is to have four votes? Are there to be four votes? Are we to make fresh calculations?

Or if we think it formally impossible or undesirable to proceed under Article 237 there is another way of proceeding. There is the familiar method known as a protocol. As the Prime Minister has pointed out, there are already several important protocols in this Treaty. I wonder how many hon. Members appreciate that France has a most important protocol in this Treaty? France—some of whose representatives insist that in no circumstances can any members or aspirants to membership ever secure any protection for themselves.

France has secured some very excellent protection. I have a book here by M. Jean Deniau, a very distinguished French authority who, I think, at the moment holds a most important position in connection with the Common Market itself. The book is called "The Common Market", and in page 87 the author states: … in the special protocol concerning France, Member States record their opinion that at the end of the first stage after the establishment of the Common Market a situation will have been reached in which the basic level for overtime payment and the average overtime rates of pay will correspond to those which existed in France according to the average figures for 1956. If at the end of that period these conditions have not been realised, the institutions of the Community must provide a suitable escape clause for French industries suffering as a result of this inequality. If, in those circumstances, one says that it is not possible for the interests of any country to be protected, one should add "except France", but, of course, that applies to everybody.

Luxembourg already has a protocol dealing with what are called "certain specific problems" special to her. So, also, has Italy, and there are various other escape clauses and protocols. Therefore, with great respect to those who have discussed this matter, the question of how exactly these changes are to be made is, in a sense, rather a technicality.

There is no time now to discuss sovereignty, but I would suggest that, to a great extent, that also is overdone.

After all, when we enter into a treaty we are not derogating from our sovereignty. As has been said by great authorities, in entering into a treaty we are exercising our sovereignty. It is one of the essences of sovereignty that we should be in a position to take such action.

In this connection, I refer again to this eminent Frenchman who, in page 61, says: … the Treaty of Rome does not attempt to establish a political community, and the machinery of co-ordination is restricted to the minimum requirements which can be foreseen at present or, to use the definition which appears on numerous occasions, 'so far as necessary to the proper working of the Common Market'. To go any further would involve a serious encroachment on the essential preserves of the political independence of the member States"—

Viscount Hinchingbrooke

How, then, would my right hon. and learned Friend interpret the words of Professor Hallstein, who said that he was not in the Common Market for economics but was in it for politics?

Sir L. Heald

In any argument in any assembly there are members who make magnificent statements which do not always agree with the rest.

One further point might usefully be mentioned. My right hon. Friend the Prime Minister has very clearly undertaken that the results of the reconnaissance, if I may put it in that way, will be communicated both to the Commonwealth and to this House, with ample opportunity for discussion and expression of view. I suggest that beyond that it would not be right to tie his hands. In such circumstances, a Prime Minister should surely be a plenipotentiary, and not a delegate.

It is not impossible that even if the actual entry under Article 237 were shown not to be possible, the negotiations and discussions which took place, if they were fruitful, might lead to some quite new arrangement, some quite new possibility. Let us look at it from that point of view. I hope, therefore, that I may ask that we should give the Prime Minister unanimous support in this most vital enterprise, so that he can go into the negotiations with a feeling that the whole country is behind him. Let us wish him all good fortune.

6.7 p.m.

Mr. William Blyton (Houghton-le-Spring)

I hope that the right hon. and learned Member for Chertsey (Sir L. Heald) will forgive me if I do not follow him, except to say that in the light of the speeches that have been made by those who are controlling the set-up in the Common Market I disagree on the political implications.

The Prime Minister has made what I regard to be the gravest decision that could be made in peace time. The technique appears to be an old one. It is said, "There is a position of difficulty; let us take no precipitate steps. The situation is obscure and we must not take up firm positions from which it will be impossible to retreat." I expect that we shall next be told that, whatever may be the merits of the Common Market, there is little we can do about it and that we had better make the best of it. I am afraid that, as a consequence, we shall find ourselves tied up with the Common Market and that Parliament will be manœuvred into a position in which it may have no option but to consent to our joining it.

I remember quite vividly the occasion when I had the privilege of putting the Labour Government's case at Strasbourg on the Schuman Plan. The present Prime Minister, the present Minister for Commonwealth Relations and the present Minister of Education were all leaning towards the federalists and against the Labour Government's case. When I heard my right hon. Friend the Member for Clackmannan and East Stirlingshire (Mr. Woodburn), who was a member of the Cabinet at that time, speaking a short time ago I began to wonder whether when I went to put the case on the Schuman Plan I had got the wrong instructions from Lord Attlee.

The fact remains that the Prime Minister and his two colleagues whom I have mentioned most certainly leant towards federalism at that time. They opposed us, and what we were arguing was that in the political implications of the Schuman Plan there was the object of federalism. We could not accept that, but suggested that when they had made up their coal and steel plan we would enter into articles of association with them on specific matters in order to protect all our economies.

When my party was defeated at the 1951 Election, the Government sent the Lord Chancellor to Strasbourg to say that the Tory Party would follow the policy laid down by us in 1950. I remember Mr. Spaak leaving the Chair, going over to the floor of the Chamber and severely criticising the Tory delegation, who had "kidded" the Assembly that they were supporting federalism when we were in power.

This controversy has gone on for twelve years. I remember, when I was a delegate in the years when federalism reached its crescendo, the American pressure that was put upon us to go into the Schuman Plan. I am pleased to say that Lord Attlee resisted the American pressure at that time. I wish that the present Government had resisted the American pressure from which they are suffering and which has brought the Common Market issue before us today.

The cardinal principle always enshrined in the Coal and Steel Community, in Euratom, and now in the Common Market, is the political and economic integration of Europe under a federal Parliament. No argument could get away from the fact that that is the basic principle on which all these set-ups are made.

We said in 1950 that we could not become full members of those set-ups because of our Commonwealth relations and that we could not accept any position on the Continent in which a Parliament there would be responsible for our internal economy and in which the elected Government of the country could not interfere with that Parliament's decisions. We said that we would enter into articles of union with the other countries. The objective of all these Common Market set-ups is that we must accept the political concept of federalism as a condition of entry. President de Gaulle, Herr von Brentano, the West German Foreign Minister, Professor Hallstein and Mr. Spaak have all told us in the last few weeks that if we are to receive the alleged economic benefits, we must accept the political implications.

We are told in this House by the advocates of the Common Market of our future doom if we do not become full members, but I am not in the least disturbed by that advocacy. A few years ago many people were shouting that we were becoming the 49th American State. Now we are to become the seventh State in Europe. Does anyone on the Government Benches believe that the Treaty of Rome, with the cardinal principles of federalism embodied in it, will be amended to allow us to enter and still to have the same trade relations with the Commonwealth as we have now? Knowing the Continent as I do, I do not believe that the Government will get this concession. Even today, nearly every one of the Commonwealth countries is very much upset at the attitude that the Government are taking.

I then ask whether the Government intend to throw overboard the Commonwealth to be absorbed in a federal Parliament of Europe and our economy to be determined by an authority whose decisions our elected Government must accept. I ask the Government why it is that the federalists of Europe could enter into articles of association with us for coal and steel and Euratom but are not prepared to give us articles of union freely negotiated in trade. Is it because they think that they are strong enough now to force us to accept a principle of federalism by threats of discrimination towards us, regardless of our relations with the Commonwealth?

If we join the Common Market, what will happen to E.F.T.A.? It was the Conservative Party which set up this economic organisation. I hope that we do not leave our partners in E.F.T.A. in the lurch if we happen to get into the Common Market on this basis. I ask my Labour Party friends in a kindly way, if we are to become full members of the Common Market, how shall we reach the commanding heights of our economy which is in our party constitution? The control of our economy will be in the hands of people on the Continent. Do the Labour Party think that if they get power and accept the Treaty of Rome they will be able to renationalise the steel industry? I am very doubtful about that, because the steel owners are now in favour of the Common Market and they regard it as another safeguard against the renationalisation of steel.

Then there is the machinery for a Council of Ministers and a Commission of the High Authority in which no decision on any matter can be carried unless it is unanimous in many instances. There is also the Council of the Parliament. The High Authority cannot be dismissed without a two-thirds majority. It has its own courts and interprets its own laws. Thus, no matter what is harmful to our economy, the Government would have a little say, since the power would reside with the Commission of the High Authority.

I regard the alleged advantages of full membership as not worth the sacrifice. Joining the Common Market as full members would also mean that we would have to join Euratom as full members, and to join the Coal and Steel Community also, because we could not join one unless we joined the other. One of the arguments that is used for this purpose is that this great combination of nations would be a third force in the world between Russia, on the one hand, and America, on the other hand. Be that as it may, I believe that if there is to be a third force it ought to be Britain, the Commonwealth and E.F.T.A. in a freely and fully negotiated partnership with Europe; but if the other countries are not prepared to have us in this rôle, I suggest that we should develop it on our own.

Let us consider some of the arguments that are involved. The advocates of the Common Market say that there might not be much in their political concept. The Treaty of Rome is full of rules and of procedures and has set up its own democratic empire.

In this country of ours we have been for centuries a political democracy. I say to the House quite sincerely that if we were to go to the people of this country and tell them that their elected representatives were to be no longer sovereign, and that vital decisions affecting the economic factors of their common, everyday life were to be left to be decided by a Parliament in Europe, we should be treading on very dangerous ground, and I do not for one moment think that if this were submitted to the people the people would accept it.

Here we see a combination of nations in collaboration, economic and political, and there is nothing in the world which can be compared with the conditions of the Treaty of Rome. I believe that the Treaty could be exploited against us in every way.

Another argument of the advocates of going into the Common Market is that if we go in we shall have a voice and shall have some influence upon the Common Market. I ask, how much? How many members shall we have in the Assembly, in the main council? Can the Government tell us? I think the people have a right to know before they are committed to this. If vital decisions have to be made, I believe that those decisions ought to be made in here and not outside. There may be in the lifetime of Governments occasions when they have to take immediate, important and vital decisions without reference to the electors, but often they have to delay things because they have no mandate. This Government had no mandate in the 1959 General Election for this serious kind of departure, and the issues are so vital that at least the people should have the chance to say whether they are prepared to hand over power elsewhere or keep it in this country.

When we talk about power within the Common Market Assembly, I have been greatly struck by the conditions. If a country makes an application for changes, even though they are detrimental to that country, there must be unanimity in many instances before the changes are passed. There are both abroad and at home advocates of the Common Market who say that we cannot have this unanimity and yet they still say that we must go in. If we cannot get unanimity in the Council of the Common Market there is nothing for us. I believe that the right hon. and learned Gentleman will not disagree with me on this, and I am not a lawyer. Moreover, suppose there is a dispute within the Common Market on any action taken by one of its members, one of which does damage which in the ordinary course of events under the common law of any country would be a matter for the courts of the country involved. It is not so under the Rome Treaty. The Common Market has its own courts and its own judges and it is its own courts which will decide issues which may be harmful to our own internal economy.

What about food prices? I do not want to read too long a list of the tariffs against those outside the Six, but for beef, fresh, chilled or frozen, the tariff is 20 per cent.; for beef salted, it is 24 per cent.; for mutton it is 24 per cent.; for wheat, 20 per cent.; for bacon 25 per cent.; butter 24 per cent.; cheese 23 per cent.; tea 23 per cent.—all external tariffs against our Commonwealth, if we cannot get some arrangement that these tariffs will apply to the Commonwealth. What is to happen to the economy of our Commonwealth?

I was reading the speech of the Chancellor of the Exchequer when he was Foreign Secretary last year. I ask the Government, do they believe what he said in that debate? I shall read what he said. He was opposing Britain going at that time into the Common Market and he said: The third matter is our commercial relations with third countries. Under the Treaty of Rome, apart from the question of the co-ordination of common policies within the Community, by 1970 members would have to abandon their direct commercial relations with third countries In our case that would mean, amongst others, the countries of the Commonwealth, and the political consequences of Rich a development would be far-reaching. Continually last year, 12 months ago, the present Chancellor was saying this sort of thing: We have to remember that we do 84 per cent … of our trade with countries outside the European Community, but, by their rules, by 1970 we would have to abandon our direct commercial relations with third countries."—[OFFICIAL REPORT, 25th July, 1960; Vol. 627, C. 1103.] Do the Government still stand by that statement made by their own Foreign Secretary, now the Chancellor? Is that what is to happen in England in 1970? The Commonwealth would be shattered to smithereens.

I would ask what is to happen to agriculture. All parties in Britain agree that the assistance we give to agriculture helps our balance of payments and keeps down prices to the consumer, and we think that is the best way for this industry. What is to be substituted for this? It may be said that in the Common Market there are arrangements for certain agricultural countries to be able to continue to give production grants in their own countries, but, of course, all our grants in England are not entirely production grants. We are paying a subsidy of about £250 million a year. About £160 million of that is production grants. What is to happen to the other £90 million? Is the farmer to have to find it? Is it to be found at the expense of men's wages, or do we put up the prices in the shops and get the £90 million that way? We have to face this situation in agriculture and exactly what the country are going to do.

I want to talk now about the trade union side of this issue. There has been a lot of talk about British manufacturers. When all is said and done, British manufacturers have to have trade unionists working for them to keep them going. We saw just a fortnight ago, from one of the Ministry of Transport's own statements, that British shipowners are having their ships built on the Continent, and our own shipbuilding is in a bad way. I want to know, will this process increase in the Common Market, as wages are less over there than they are in our country? If we join the Common Market and are still to get shipbuilding back here, will our shipbuilding workers have to suffer a reduction so that our yards will be able to compete?

I heard an hon. Gentleman in the last debate say that going into the Common Market would give British industry a jolt. I am afraid that the biggest jolt will go to the trade unionists. If we join the Common Market, Western Germany, France, Belgium, Italy will export freely into Britain. With their generally lower wages and working conditions they will be able to carry out a vicious price war against British manufactures with the certain result of unemployment and a depressed standard of living for the British trade unionists. But having entered this market, no matter what party was in power, the British Government, having lost control of the economy, would be unable to offset this unemployment because it would no longer be able to control imports and investments or plan a new distribution of industry.

I would say to my trade union friends outside the House, "You had better be careful about this because you will wake up some day and find yourselves in extreme difficulties." There is the problem of the mobility of labour. This mobility may be a very desirable thing if it can be arranged with the agreement of the workers and at the same time a happy state of affairs can be arranged for them.

Let hon. Members consider the situation in my industry—coal mining—for instance. We all know what happened in that industry when Italian labour was introduced. We have heard in the House agitation about West Indians coming into the country. I think that the trade unions ought to know how the system of mobility within the Common Market is to work and how it will affect the trade unions. There is a great agitation now to keep Commonwealth people out of this country, but are we to accept the French, Italians, Belgians, Dutch and Germans and keep our Commonwealth friends out?

At the same time are we to send our people to work in these Continental countries? Are we to tell the people of Britain, as we must do, that if we join the Common Market and there is no work for them here they must go to work on the Continent? What about wages? Continental wages are lower than ours. German wages are lower than British wages. [HON. MEMBERS: "No."] Are wages to be harmonised up or down? This is a question which trade unionists must face.

I am prepared to agree to articles of association freely negotiated, but I am not prepared to throw the Commonwealth over so that we may be full members of the European Common Market. I am not anti-European but I will not be forced into federalism, because I believe that it would break up the Commonwealth, give us a small voice in Europe, and give us no power in this country over our own economy. I would say to the Government Front Bench in the words of Shakespeare: The friends thou hast, and their adoption tried, Grapple them to thy soul with hoops of steel.

6.32 p.m.

Viscount Hinchingbrooke (Dorset, South)

The last thing that I would want to do would be to hurt, embarrass or offend the hon. Member for Houghton-le-Spring (Mr. Blyton) in any way because I have very great admiration for him derived from fifteen or twenty years of acute political controversy, but the fact of the matter is that I agree with every word he said. I regard it as a very great honour and privilege to take part in this historic debate.

Mr. Charles Royle (Salford, West)

Does the statement which the noble Lord has just made include the comment which my hon. Friend the Member for Houghton-le-Spring (Mr. Blyton) made about the renationalisation of the steel industry?

Viscount Hinchingbrooke

I will come to that before I finish.

If I may be allowed, as briefly as possible, I should like to address the House on this occasion on three principal aspects of this matter—the economic results that will flow from membership of the Common Market, the effect upon the Commonwealth and the change that will ensue in Britain's position in the world balance of power. I could not in any circumstances vote for the Government in the Division tomorrow night, because a careful reading of the figures of our overseas balance of payments recently and over the last few years has led me to the conclusion that the Government's existing policy of free trade, to say nothing of the cost to the taxpayer of cushioning the results of it with subsidies, now lies in ruins before our eyes and any further expansion of free trade by joining the Common Market would carry the process to disastrous lengths.

I voted for the American loan in 1945 because the country was exhausted, badly fed and needed recuperation. It needed reinvestment, it needed activity, indeed it needed even another tin of Spam on the shelf, and it did not seem to me that that could be achieved without accepting the American loan. One felt that in voting against it one was straining at the camel, apart altogether from swallowing the gnat of the consequences of the loan in the restrictions which it put on Imperial preferential arrangements and discrimination in trade.

Then followed G.A.T.T. and the increasing disposition of both Governments, Socialist and Conservative, to go in for this policy of free trade. The effect was masked by the devaluation which took place in 1949. But we are now drawing away from the benefits that immediately ensued to the Conservative Government in 1951–52 from the tariff effect that a devaluation has. If one looks at the figures, one can see the situation we are now getting into. For the years from 1952 to 1959, with the single exception of 1955, we had very large export surpluses on our visible and invisible trade ranging from £350 million to £180 million. The plunge into our present almost desperate situation began in 1959 when we had an exportable surplus of only £145 million. In 1960 we went for the first time, except for that single year I have mentioned, disastrously to the figure of minus £300 million.

I cannot see how it is possible to join the Common Market, with the consequential reductions of tariffs that will be made in those circumstances, without a further devaluation which will immediately ensue to rectify the anomalous position of Britain's overseas trade. I am not altogether unhappy that, economically speaking—though politically I think there are great advantages in it—the E.F.T.A. group is now making its own way home and making its own arrangements with the Common Market. For E.F.T.A. was and is very expensive.

Out of a total overseas deficit with the non-sterling area of £400 million this year, E.F.T.A. accounts for £50 million. The Common Market, without any further tariff reductions, accounts for £150 million. What that figure will rise to when we start the process of tariff reductions I do not know, but it seems to me that a very dangerous situation is bound to arise if the Government persist in this policy of free trade. Free trade accompanied by a determined policy of full or over-full employment must result in devaluation.

It seems to me that the equation is all too clear, and that is why I say that the Government's policy now lies in ruins and that something must be done to correct it. Indeed, the Chancellor of the Exchequer took the very action necessary to help to correct it the other day when he clamped on a 10 per cent. increase in tariffs to help save the £. That is the sort of control that we shall lose if we are part of the Common Market.

Then we are told that competition is vital for British industry and that, somehow, we shall get competition by going into the Common Market. In the case of the export trade, it seems to me that we shall merely add to the length of industrial order books and the length of industrial delays. What is going to put the exporter on his toes unless it is done by legislation in this House, or by cajoling him, or by some of the exhortatory devices which the Government apply from time to time? How is the placing in front of the exporter of a new market in Europe going to put him on his toes? I should like to know the answer to that.

Then there is the import side. Are we really prepared to see small tirms—I suppose the big firms can look after themselves—which produce in the home market put out of business by the arrival in this country of an enormous new flood of goods from across the Channel? How many of the small producers in this country can tee themselves up and go straight off into the export trade?

My hon. Friends have been calling for special inducements in the last Budget to help the export trade. I cannot go now into the fiscal immorality of that, as I conceive it, but it is symptomatic of the all too liberal policy of free imports that we are forced to prise people in this country out of their natural setting in supplying the home market and push them into the export trade in order to try to recover the ground that is lost by the importations.

There is a wider aspect of this. The hon. Member for Houghton-le-Spring touched on it as only he could. I accept, with reservations about the extravagances of it, the Welfare State in industry. I do not like the subsidy to the Cunard Company. I do not like the cotton scheme. I do not like the idea of taxpayers' money being used to site industries in certain places. However, by and large, we have arrived at a situation in this country where work is done according to certain rules legislated for by this House and agreed to after zealous trade union bargaining with employers over many generations.

What part of this Welfare State in industry is to be jettisoned in order that industry can be put upon its toes by joining the Common Market? Which of the tea breaks is to be given up—the morning or the afternoon? Which industries are to work longer hours than they do now? Which are to go back to one week's holiday with pay, or none? Is it this sort of idea of putting British industry on its toes on which some of my hon. Friends who are very commercially minded in these matters are so tremendously keen?

Mr. William Shepherd (Cheadle)

is not my noble Friend aware that some of the countries with which we shall be in direct competition have shorter hours than ours, longer holidays—[HON. MEMBERS: "And more money."]—and much better social welfare?

Viscount Hinchingbrooke

My hon. Friend the Member for Cheadle (Mr. Shepherd) is now talking in the most delectable terms of increasing the Welfare State in industry by joining the Common Market. Most of his hon. Friends have, I think, taken an altogether different view. They are ashamed of certain aspects of British commercial and industrial life, and so am I, of some of the impossible and ridiculous restrictions on both sides of industry. But these are things which are much better dealt with in this House under our own volition than, as it were, by a side wind by joining the Common Market.

Finally on this economic point, there is the control of our fiscal policy. I touched on this just now. We have had what is supposed to be called a stop-and-go system—stop when one gets to an inflationary situation and go when one gets to an impossible unemployment position; and these things are conveniently timed electorally.

When Brussels takes over, the time scale may not be quite the same. Apart from how it will affect the fortunes of Her Majesty's Government, it is perhaps more seriously true that our unemployment might rise to almost disastrous proportions and that our inflation might be in a galloping state before the bureaucracy in Brussels took the action necessary to rectify the situation.

I want now to refer to the Commonwealth aspect. There seem to be two empty arguments which have been used and which ought to be disposed of, and I will try to do that as briefly as possible. It is said that trade is declining in the Commonwealth. Who wonders? The Government have not done much—no Government has done much—since the war by redesigning the Ottawa Agreements, or even attempting to do so with Commonwealth Prime Ministers' conferences, in order to get Commonwealth trade improving and reviving. As I have said, it is declining. What of that? Suppose it was increasing. Would the advocates of going into Europe then say that because it was increasing it could be let alone and that we should make our arrangements with Europe, divert our trade there? It seems to me that the argument cuts both ways, and that that particular one is hardly worth considering.

There is another point, that the Commonwealth is now no longer supplying the raw materials to this country, that the old pattern of exporting high-cost merchandise to the Commonwealth, investing our exportable surplus, and importing low-cost materials, is over, that the Commonwealth is getting industrialised, and that we can no longer go along on the same arrangements with it as before. If that is the case, what is the argument for joining the Common Market. The Common Market is industrialised. Again, that argument cuts both ways.

Fortunately, Britain's export surplus with the sterling area, including Canada, has been running consistently high at £250 million, and over the years since the war we have reinvested a great part of it—an average of £140 million per year since 1945. That compares very favourably with the investment that we put back into the Commonwealth in the years after the First World War—an average of £67 million between 1925 and 1929 and £28 million between 1932 and 1936. That means that we are now reinvesting in the Commonwealth with this exportable surplus of the sterling area rather more, relatively speaking, at prewar prices than we did in the period immediately after the 1914–18 war and three times the rate at which we were investing it in the period before the last war.

That surely points the way. If we are having this success already to the tune of about £140 million, why should we not take it up almost to the level of the £250 million that were receive from the Commonwealth? Why, for example, is there no payments union with the Commonwealth such as there is with Western Europe? We have since the war devised every sort and kind of scheme for economic co-operation in Europe, but we have practically nothing comparable in the Commonwealth.

The Government do not seem to be as sensitive to the developing needs of the Commonwealth as they are to the organisation of Western Europe, and I cannot but conclude that this derives directly from the United States policy which has constantly concentrated our minds on the menacing position, as it seems to them, of these ill-organised States of Western Europe facing across to the Soviet Union.

Britain has all too easily slid into a position where it has been careful to devise all these schemes for Europe and neglect them for the Commonwealth. There is a sort of "shotgun marriage" going on with Europe, ordered by President Kennedy and carried out by my right hon. Friend the Prime Minister. It is time that this country realised that, and began to see how it is neglecting, with the new techniques of economic co-operation, the purposes of the Commonwealth.

I should like to see established not only a Commonwealth payments union but also a Commonwealth bank. It should be possible to get over, as I have said in previous debates, the terrible disability of a crisis in our balance of payments when we export substantial capital to the Commonwealth. If we could devise a system whereby no greater harm befell this country by exporting its capital and merchandise wholesale to the Commonwealth for investment than by exporting from Glasgow to London, then at least we should have put ourselves into a powerful position in the world.

Now I turn to the political problem itself. Many of my hon. Friends seem to regard the trade war as if it were part and parcel of the cold war and fought with the same weapons. The trade war is an entirely different concept. It is not a war of internal lines of communication and great agglomerations of industrial power. It is a war which is fought in the deep field behind the enemy lines. It is a war in which we should use every device that we have for straddling the Iron Curtain. Fortunately, we have such a device in the Commonwealth itself.

I do not object to President Nkrumah going to Moscow. Some of my hon. Friends, however, regard it as an almost traitorous thing for him to do. We have to realise that my right hon. Friend the Prime Minister himself has been to Moscow. Recently, we have also had the remarkable success of the British Trade Fair there.

These acts of success in the trade war are, fortunately, much more applicable to this country than to some others which have vast bureaucracies and slow moving industrial machines. One has only to read The Ugly American to see how gross was the failure of the United States to fight the trade war successfully in South-East Asia. The Russians are not making a very great success of the trade war, or even of the cold war, in parts of the world, such as Africa, where we have created a vacuum by leaving precipitately, or threatening to do so.

These vast industrial machines are not good at the process. We do better with Out "small ship" philosophy—the one that defeated Napoleon and defeated the King of Spain. [HON. MEMBERS: "Hear, hear"] Our small, quick moving, resilient, resourceful trading philosophy is one which is much more likely to secure a key political contract, provided that it is backed up by a good organisation, than anything that may come from these enormous powers. For that reason, if for that alone, I should not be for joining the Common Market and getting involved in that vast complex of countries.

Finally, I believe that there are a number of my hon. Friends who would like to do the Samson act. It is a horried thing to say, but I feel bound to say it. I feel that it is my duty to say it. There axe hon. Members on this side of the House who would rather see this country ruled by European bureaucracy than ruled by British Socialism. The fear of nationalisation, of loss of business enterprise and of over-taxation is such in the minds of some of my hon. Friends that they think there is a nice easy escape route out of it into Europe.

I do not believe that the Socialist Party is an alien philosophy that is trying to work an evil on our society. I therefore hope that as many of my hon. Friends as agree with me—and more particularly with the most brilliant speech of my right hon. and learned Friend the Member for Hertfordshire, East (Sir D. Walker Smith)—and as many hon. Members opposite, who have cause to fear—as was expressed so well in the speech by the hon. Member for Houghton-le-Spring—ought on this issue to join together and tell the Liberal-Conservative Government, if not tomorrow night then very soon indeed, that the paramount success which "Mr. Butskell" has had for a very long time is not necessarily eternal, and that it is possible to have a group of hon. Members on both sides of the House which will be effective in exorcising the spirit of intent of some Ministers and in producing again a policy of which this country will be justly proud.

6.57 p.m.

Miss Jennie Lee (Cannock)

The House has listened to a most remarkable speech by the noble Lord the Member for Dorset, South (Viscount Hinchingbrooke). Whether we agree with all or part of what he said or not, at least we are indebted to him for the candour with which he spoke, and I shall endeavour to pay him the compliment of continuing this debate and argument with equal candour.

No issue which has come before this House in my lifetime has been of greater importance. This is not an occasion when strict party rules, Whips, or anyone else, ought to decide the issue. It is too big for that. I hope to reply to some of the comments made by the noble Lord and others on the economic front. As a nation we have to earn our living. But first of all I want to deal with what for all of us is the paramount issue in the world—even greater than our standard of living.

When we are at war, as in the Second World War, we feel that it is for a worth-while cause, and we take great punishment and face many hardships. At the present moment, when the world is in a state of cold war, surely the biggest question of all for us is: how can our nation so conduct itself in the affairs of the world that we make our maximum contribution to reducing the nightmare danger of a third world war? That takes precedence over any other issue.

I am appalled when I hear hon. Members on both sides of the House suggesting that the combined wisdom of Dr. Adenauer and President Kennedy is greater than anything which we can produce to deal with the danger of a third world war. It is not my philosophy to be anti-German, anti-American, or anti-Russian, as I have said before. I think that that is illiteracy. But the German mind is highly regimented. The German people are clever, but there is a distinction between cleverness and wisdom. In the same way, particularly under a young President, the Americans are apt to regard the various countries and needs of Europe as if they could draw parallels between them and the various States of America. That is not possible, and I am glad that my right hon. Friend the Leader of the Opposition made that point.

What I fear most is the polarisation of world forces into one vast area of power and influence which is Communist-dominated and another vast area under Conservative-Catholic-domination. We have had enough religious wars in the past, and we must now try to ensure that there is not another, because we shall not survive it. When I read the speeches from the leaders of the European Community, Professor Hallstein, Dr. Adenauer and others, I find that again and again they reiterate that their basic concern is not economic but political, and they say that it is political mainly in order to provide a build-up of forces which will contain Communism.

I want to contain Communism. I do not find it easy to live at peace with the relatively mild Whips in the Labour Party. I should find it impossible to live under any stricter discipline. But how many of the European nations have anything to teach us about how to contain Communism? There is a powerful Communist Party in Italy. There is a powerful Communist Party in France. If there were not a divided Germany, there would be a powerful Communist Party in Germany. But in recent elections not a single constituency in Britain could have been won by a candidate advocating the Communist cause.

Why is that? It is because in our internal affairs we manage things in such a way that we keep alive the hope that the authority of the House of Commons will be sustained, so that the noble Lord has an innings one time and can scold my party for spending too much on the social services while at another time I can have my innings and scold his party for spending too little on them. The noble Lard might think it unwise to extend full public ownership and I might think it absolutely essential, but in our own internal affairs we have managed pretty well to offer alternative ways of living and governing to that offered by the Communists.

If there were no other reason for trying to sustain the Commonwealth, I would wish to do so because I see it as an area of relative coolness between the hot total capitalist attitude which comes from business pressures on both sides of the Atlantic and the equally dedicated Communist pressures which come from the other side of the Iron Curtain. Do we really say that by going into the Common Market we can make a greater contribution to what we all want—a live and let live atmosphere in the world?

Then there is the question of E.F.T.A. What is to happen to Finland? What is to happen to Austria? Is it not something that we were building up Commonwealth ties and all the hope of a multiracial Commonwealth? We have heard a great deal about Christian leadership, but is not the hope of the Commonwealth the hope of a racial brotherhood in which we neither seek to patronise nor to be patronised? Is not that something well worth upholding and does not that give us strength in Asia, Africa, India and other wide areas, an influence which may not be produced by other methods?

The Commonwealth's trade has to develop. I know that Australia and New Zealand and Canada have got to live, but if we spent on trying to build up Commonwealth associations to our mutual advantage one-tenth of the energy which we spend on trying to get into the European Common Market, we would find it very worth while.

I am much obliged to the noble Lord for bringing into the open something which some hon. Members on both sides of the House are too nice to talk about. He said quite clearly that one reason why some of his colleagues were anxious to join the European Community was that they thought that in that way they would build a bulwark not just against Communism but against democratic Socialism. I ask my hon. Friends to consider what would happen if we became members of the European Community and had a Labour Government, How can it be said that the fortunes of that Labour Government would be uninfluenced by such a membership?

We are all grown up and we all know perfectly well that every country interferes in the internal affairs of every other country to the maximum of its power and ability. No matter how much I admire my American friends and wish for good Anglo-American relations, I hotly resent the way in which time and time again, at critical moments in our history, America has interfered in a way going far beyond the bounds of propriety.

The noble Lord spoke of the pressures from America, from President Kennedy, on us to join the Common Market. I remember the pressures which came from America in 1945. The noble Lord said that he did not vote against the American loan at that time, when there was a Labour Government. It was not an easy decision for me, but I did vote against the American loan.

I thought it shocking that immediately at the end of the war when our whole economy had been re-geared in order to produce certain things which were our contribution to the war and when we needed a period to reorganise our affairs, Lend-Lease came to an immediate end. It was doubly shocking that we were offered a loan by America on terms which the Americans themselves knew it was impossible for us to fulfil.

I did not like the shady conversations in the background—"Never mind, old boy; we know that you cannot do it, but this is just a good public relations job for the American people." Great nations should not behave like that, and I wish that the Labour Government of those days had not agreed to the loan so readily. What I am now saying I said at the time.

I wish in the same way that America had not interfered so much in 1951. Once again we had American pressure asking us to make a contribution which was beyond our economic and manpower resources. That is not the way to make Britain strong or build up our defences, or make friends in the world.

Now, under a Conservative Government, pressure is being put on us by the Americans to join the Common Market. With all modesty, this country ought to tell those who are pressing this advice on us that we know better; that we are not, as one of my hon. Friends said the other day, uniting Europe by going into the Common Market but we are doing something which is terrifying. We are dividing Europe more drastically than ever before.

Some generals are supposed to prepare for the next war by furbishing the lessons learned in the last one. Some economists take the same line. They say that the only thing we have to fear is Germany once again going on the rampage. I am afraid of a more real danger. I am afraid of a combination of certain forces in Germany, France and Italy becoming so afraid of Russian economic competition that they will drift to the edge of war. I believe that we can influence European behaviour better by staying outside the Common Market than by going into it. We have only to look at the figures to see that on all the important issues we would be outvoted. The paramount issue for me is how best we can make a contribution to easing world tension, and how far we can create an atmosphere of live and let live.

The next point is that we have to earn our living, and I believe that here we come to an impossible position. The Prime Minister has had a good time for a number of years. I would be the last person to attack him sharply today, because I know very well the aches, pains and difficulties of his position. I am certain that he is trying to do what he considers best, but in the last ten years he has considered it best not so to reorganise the industries of Great Britain, not so to stimulate our export trade, and not so to reorganise our internal incomes that we would be fit to meet world competition. Instead, he has been having a party. Now he is having a hang-over. The right hon. Gentleman has been having the kind of party which has alienated elements in this country without whom it is impossible to rebuild our economy, whether we are inside the Common Market or outside it.

We cannot have a situation in which 16s. of every is divided among about 10 per cent. of the population and the remaining 90 per cent. have to scramble for their share of the remaining 4s. Any economist could make minor adjustments up or down, but that is the broad picture. The distribution of wealth in Great Britain is more unequal even than in super-capitalist America.

Mr. Douglas Jay (Battersea North) indicated assent.

Miss Lee

I am glad to see my right hon. Friend nodding. I am glad to be in agreement with him for once.

We cannot leave those factors out of our considerations. I believe that our people have a strong sense of fair play. They will do their best work if they think that they are being treated reasonably. Not long ago we debated industrial relations. Illustrations were given from both sides of the House to show that when managements behaved sensibly they had no trouble with their shop stewards and their production benefited according!), but when they were arrogant, old-fashioned or over-greedy, there was trouble.

I can see no way out of the present situation for the Government. They do not know what to do next. They are using the European community as a kind of funk-hole. Suppose that we were in the European Community, and suppose we found that it did not have all the wonderful advantages which are supposed to flow from it, and suppose we found that there was industrial unrest in this country and that some of the issues could not be dealt with by our employers, our trade unions, and this House, how would the British people react to that kind of situation?

I said earlier that there was not a single Communist Member of the House of Commons. If all kinds of businesses and individuals were being pushed around without being told why they were being pushed around, and they felt that the shot in the arm was all going into one arm and they were getting the swelling and the pain without any of the advantages, the result of a General Election held in those circumstances would be such as we have not had in the past.

Some of us profoundly believe that this island cannot play its part in the world, and cannot sustain at the highest possible level the standard of living of our people, unless we have a planned economy. The noble Lord went part of the way with me. He and I could get out our banners and go on a demonstration against the old-fashioned nineteenth century Liberals around the House who believe in free trade. I do not believe in free trade, any more than the noble Lord does, but I believe in planned trade. If we are to plan our trading, how do we set about it?

We are told that we will get the most wonderful new markets if we go into the European Community. When I go round London and the southern counties, I meet one industrialist after another who simply does not know how he will fulfil his present orders. He cannot get raw materials, or the quality of labour which he requires to do the job. How will going into the Common Market solve those problems? Will it mean that instead of having unemployment in parts of Scotland and the North, and over-employment in other parts of the country with the result that schools and hospitals there are over-crowded and there is an ever-growing demand for houses, we will be able to put our internal affairs in order?

I was recently in Northern Italy. As everyone knows, Northern Italy is bulging with prosperity, but before anyone says "Three cheers" let him remember that the prosperity is in Northern Italy and not in Southern Italy. In Southern Italy the unemployment position is shocking and the standard of living is desperately low. But, more than that, civilised people in the north of Italy are shocked at the distribution of wealth there. I will not labour that point further, but we are constantly having battles about whether the standard of living in Europe is higher than it is here.

I do not think that we will become another Southern Italy or a junior member of the Krupps empire if we go into the Common Market. We could easily go in without it improving the way in which we use our manpower, our coal, our steel, how we plan our resources, and so on.

Our first job is to put our own house in order. There is no escaping our Socialist claim that we must have a planned economy. We must know what we want to do with our manpower. We do not need more orders; we need different orders. We are using much of our manpower in coal, steel and land unintelligently, wastefully and stupidly. If we can give an example to the world of a civilised community with a spirit of live and let live among its people—even between people of different political points of view—and if we can go to our trade union leaders and those in the rank and file and say, "Look, lads, here is the jab that has to be done," we may be able to get back to the status that we won during the war and kept in the years immediately afterwards.

There was nothing wrong with the British worker in those years. Very much less time was lost in strikes, and there was a much higher output year by year, because the workers knew what was happening to them, and it made sense to them. We were building up a Health Service and the various social services. We need not be afraid of appealing to the common sense of the British people, but the British people have far too much pride, as well as sense, to think that they can solve their difficult internal problems by looking for a funk-hole in Europe.

7.21 p.m.

Mr. Peter Smithers (Winchester)

The House appears to have taken with fortitude the announcement of the coalition between the hon. Member for Cannock (Miss Lee) and my noble Friend the Member for Dorset, South (Viscount Hinchingbrooke), but I cannot congratulate either upon the first product of that coalition. My noble Friend said that many members of his own party supported the idea of association with the Common Market as a means of defeating Socialism in Britain, and the hon. Lady made it clear that one of her principal objections to association with the Common Market was that it would make it inconvenient for a Socialist Government here.

I do not think that a majority of Members on either side of the House is governed by considerations of that sort in relation to this great matter. We would do well to take the advice of my right hon. and learned Friend the Member for Chertsey (Sir L. Heald), who pointed out that the question before the House today is not the merits or demerits of the Treaty of Rome but whether or not we should negotiate to establish certain positions. That is the question to which we should return.

This is a happy occasion for me, because my first memory of European affairs on any scale is of the Brussels Conference of the European Movement, in 1948 or 1949. I travelled to Brussels with my right hon. Friend the Prime Minister and my right hon. Friend the Member for Streatham (Mr. Sandys), and I remember that when we arrived at Melsbroek Airport my right hon. Friend the Prime Minister was wearing a bowler hat. As we left the airport he remarked to me, "One should always wear a bowler hat on the Continent." Shortly afterwards, about forty of us were standing outside the airport waiting for taxis. One taxi drove up and went straight up to my right hon. Friend the Prime Minister, who got into it and drove away. Ever since then I have believed that he has a great understanding of European psychology.

I want to refer to the speech made by the hon. Member for Houghton-le-Spring (Mr. Blyton), in connection with the events of those days. The hon. Member recalled a time when, as he alleged, the Conservative Party at Strasbourg and elsewhere stood for federal principles in Europe. That is a quite erroneous statement, and it would be most unfortunate and dangerous for us all if such an idea gained currency. Neither did my right hon. Friend at that time, at Brussels, nor has the Conservative Party at any time at Strasbourg, since, come out in favour of a federalist solution in Europe; on the contrary, we have repeatedly made it clear beyond question that that was not the opinion of our party.

I now want to turn to the speech of my right hon. and learned Friend the Member for Hertfordshire East (Sir D. Walker-Smith). He talked a great deal about ostriches, and he characterised the ostrich as an inelegant creature. If his speech is anything to go by, and if elegance be the criterion, my right hon. and learned Friend is certainly no ostrich. His was a most artistic presentation of his case. But when he said that he wished Io view the distant scene he made the mistake, which is so often made by those who have very positive views about this very complicated matter, of viewing only one of the many scenes which have to be viewed.

He looked only in one direction—that of the Treaty of Rome—and in doing so, like others who have followed him, he maximised the various bogies to be found under the various beds. Some of them are quite real, but a great many are purely theoretical. The direction in which he did not look is that in which we shall drift if we do nothing. That is the question which has to be asked. Can we, in practice, do nothing? At the end of my right hon. and learned Friend's speech he stated five things which we should avoid, but when it came to the question of any practical move forward into a dynamic age, he said that he was for close association with the Commonwealth. I am sure that none of us differs with him in that. For him, that more or less dismissed the matter. I am sure that to do nothing is not an answer to our problem.

I want to consider the question of sovereignty. I thought that from a distinguished lawyer I might have heard a definition of sovereignty but I did not hear one from my right hon. and learned Friend. I am not a good enough lawyer to give one myself, but I think I know what the House and the people mean by the word. They mean effective control over the destinies of the nation by us in Parliament. But today the destinies of the nation are decided by all kinds of things very germane to ibis debate. They include our ability to become a space Power, to undertake military operations even on a modest scale, to conduct our economy in conditions not entirely dependent upon the benevolence of others, and to afford heavy commitments to under-developed countries and other parts of the world.

It is apparent that the giant Powers which are growing up in the world today are able to do all these things, because they can afford them. The United States and the Soviet Union can do all these things, and, shortly, China—and before long, no doubt, the Common Market—will be able to do them. But we in Britain are in a very difficult situation. If we were the French, we could at least say that we could feed ourselves, and double or treble our agricultural production if necessary. That would give us a certain nonchalance in economic affairs. But we cannot do that. If we were Switzerland, we could say, "We have no world-wide commitments. We do not have to keep up armies and garrison garrisons, and so forth," and therefore we could consider ourselves to have a powerful sovereignty. If we were little Albania, we could say, "We are supported by the Soviet Union, or China, and that is what our sovereignty is worth." But the plain fact is that our sovereignty today is a precarious one, and in practice it depends upon our relations with the outside world.

Whatever we may resolve to do in the House of Commons our resolution will be impotent if we do not have the means. That is what these negotiations are really about. I am quite sure that if there is one thing that we ought to be dogmatic about in this debate it is that it is not open to Britain to do nothing. We simply have not the resources in an age of power politics to be a great Power entirely and solely by ourselves. We cannot stay as we are unless we wish to decline into poverty and impotence. Therefore, those who oppose these exploratory negotiations must make some other proposal. I have not yet heard another proposal and I want to hear one before the end of this debate. They must face the fact that inertia is not the answer to the problem of Britain at present.

I believe that we are drawing towards the end of a long historical process. My right hon. and learned Friend spoke of the need for us to glance at history and to get everything into perspective. J humbly suggest that the perspective is this. The whole history of political mankind is the history of the coalition of small political units into larger ones. First, the kingdoms of England, then the formation of a modern Britain, or of a modern France a modern Germany or a modern Italy. Now there is the appearance of super-States. It is this historical process with which we are confronted, and we have to make up our minds whether we wish to take part in it or not. I believe that if we stand aside we condemn ourselves to oblivion in the history of the world of the future.

I know that it is suggested by some hon. Members that here the Commonwealth is the answer. When I first became a Member of this House I was, and I remain, a devoted adherent of the Empire and Commonwealth. I believe it is that thing which distinguishes us from all other nations and which we must preserve at all cost to ourselves. But again, we are not living in a static age. To listen to the speeches made by some of my hon. Friends one might think that the world around us did not change. But the world is changing fast and the Commonwealth with it. The noble Lord produced a lot of figures about investment in the Commonwealth after the First World War and it is very gratifying to know that now we invest more. But the scale is increasing far beyond that. We have to ask ourselves whether we in this country, a nation of 50 million, can provide the finance, the capital goods, the technical "know-how" and all the other things demanded by a Commonwealth of 600 million. The noble Lord spoke about a Commonwealth bank, a very good idea. But what I want to know about the bank is what is in it. and I do not believe that this country alone has the resources to fill such a bank.

The problem of the Commonwealth is that in an age when its demands are very great its members turn increasingly—anyone with his eyes open can see this fact for himself—to the United States, some of them to the Soviet Union—and in future they may well be turning to a Common Market of which we are not a member—for the supplies which they cannot obtain from us. Not only that. It is not only a question of quantity. The organisation of these new giant States will mean that they will be supplying what the Commonwealth wants on better and more competitive terms. This House must ask itself: if we value the Commonwealth, can we really hope to hold it together all by our little selves, as some hon. Members seem to think that we can? It would indeed be a pleasant world were that so, but I do not believe this vision.

I ask myself; is it better to see the lines of Commonwealth trade and finance, and with them politics, drift away into other hands—hands with which we are not associated? Or is it better to see whether we can find that basis of association with Europe which will enable us to associate Europe in partnership with the Commonwealth in its economic and political structure? My belief is that the antithesis put before the House and the country of a choice between Europe or the Commonwealth—eyes to the right and noes to the left—is an entirely false antithesis. I believe that if we can solve the problem in Europe we can solve the problem in the Commonwealth and benefit both as never before. If we fail in Europe, then indeed I have grave misgivings, which I should be wrong not to state today, about the future of the Commonwealth.

I wish now to refer briefly to the problem of the Seven, which was referred to by the hon. Lady the Member for Cannock. It must be remembered that the Seven came into being in particular circumstances. This association came into being very largely because its members were afraid of being picked off one by one by the Common Market. It did not come into being because of itself it was a very coherent economic whole, and anyone who studies the structure of the Seven will see straight away that in the long term a number of its members are in considerable embarrassment. I think that we should be foolish to assume that if our negotiations about the Common Market fail we can be certain that the Seven will remain as a permanent element in the situation. I merely say that in reply to the hon. Lady the Member for Cannock, because I think that it would be a mistake to build 100 much on an organisation which presents great difficulties to some of our friends.

I wish to say—I should be wrong not to do so—how I think that we ought to approach these negotiations if they are to succeed. There is one cardinal point which cannot be ignored. We must learn the lesson of past negotiations, of the negotiations for the Grand Design and the negotiations for the Free Trade Area. Both were errors of psychology, however desirable in themselves, because both were interpreted by those with whom we negotiated as being designed to destroy what they were creating. If these negotiations are to succeed—I think that the House is generally agreed that it would be a serious situation if they failed, whatever view we may take of their purpose—the first and cardinal point is to establish our good faith with those with whom we negotiate, and to convince them of what I think we are convinced ourselves, that we do not wish to overthrow what they have built but, on the contrary, we wish to strengthen and fortify it.

I do not take a very optimistic view of these negotiations. The problem has become so very wide.

Mr. Sydney Silverman (Nelson and Colne)

Hear, hear.

Mr. Smithers

I am glad if I am cheering up the hon. Member for Nelson and Colne (Mr. S. Silverman).

If we have to reconcile the Six and the Seven, and consider the interests of the Commonwealth, and think about the problem of the English and French territories and ex-territories in Africa, and then find that there are one or two good friends not comprehended anywhere else whose interests have to be taken into account so that they are not damaged by what we do, we are getting perilously wide; well away from the close concept of Europe and into something which gets very near to being the whole assembly of the G.A.T.T. This presents a psychological difficulty to the negotiations, because the picture then begins to look exactly like what the Common Market people fear may be our intention—an attempt to absorb the Common Market into this larger whole.

I have merely posed the problem. Perhaps I may be permitted to say this to my right hon. Friend the Lord Privy Seal. Since he has been charged with the responsibilities which he holds, the European question—which I have followed through the years with disappointment about what we might have done in years gone by—has taken on a new sense of purpose and is being handled with a fresh understanding. I wish for my right hon. Friend purposefulness and understanding in all that he may do in this matter.

Finally, what if the negotiations fail? I think we should be wise to face this. It is often said by those on the Continent that the Channel no longer exists, strategic considerations have washed it out, and so forth. That may be so. Then they go on to say—or presume without saying it—that Britain is therefore a part of Europe. I do not believe that any such consequence follows. The Atlantic does not exist either, when one talks in terms of military strategy today.

I think that it should be made clear to those with wham we negotiate that it would not be tolerable for us to find at the end of lengthy and detailed negotiations which had broken down that we were still expected to carry many of the burdens of Europe with all the disadvantages which would come with them, without being permitted to participate in the benefits. Therefore, some very radical rethinking about alliances and alignments would be required. If we were to be driven back on G.A.T.T. in these circumstances, it must be clear that—not as a matter of spite or of choice, but of necessity—we would be compelled to fight in the G.A.T.T. and everywhere else against hostile commercial and financial groupings of which we were not a member.

This is precisely the situation which, in the interests of the free world, I wish to avoid. Therefore, I suggest that there are powerful reasons why the members of the Common Market on the Continent of Europe may on reflection think it wise to try to help us to bring these negotiations to the successful conclusion which I, for one, wish to see them reach.

7.41 p.m.

Mr. H. Hynd (Accrington)

This is a most unusual debate with lines cutting across both parties. I find myself, somewhat to my surprise, in agreement with at least a large part of what the hon. Member for Winchester (Mr. Smithers) has just said.

He reminded us that he has been interested in this subject since the conference at Brussels. I can go back a little further, to the original conference at The Hague, and since then I have been keen that this country should play its part in arrangements for bringing the countries of Western Europe closer together. I think I can say that subsequent events and experiences have confirmed and strengthened that view.

My right hon. Friend the Member for Clackmannan and East Stirlingshire (Mr. Woodburn) reminded us of those early times from The Hague conference onwards and of how Western Europe felt very badly let down when the great protagonist, the right hon. Member for Woodford (Sir W. Churchill), changed his mind on coming into office and did not carry out in office what he advocated in Opposition. It is for reasons like that, while in principle I am with the Government in their desire to enter into negotiations, that I am a little suspicious about the people who will negotiate in our name. Of course, I would much rather that a Labour Government were doing the job.

There have been many attempts to unite Europe, dating from the time of the Holy Roman Empire. Everyone has realised the necessity for something to be done. If I read a short quotation I hope it will not be discounted because of the source from which it comes. It is as follows: In that vital region history, custom, language and prejudice have combined to hamper integration. Progress has been and is hobbled by a web of Customs barriers interlaced with bilateral agreements, multilateral cartels, local shortages and economic monstrosities. How tragic! Free men, facing the spectre of political bondage, are crippled by artificial bonds that they themselves have forged and they alone can loosen. That is what ex-President Eisenhower said when he took command of S.H.A.P.E. ten years ago. That is roughly the picture in Western Europe where something obviously had to be done and still has to be done to overcome many of those obstacles.

We ourselves recognised the necessity for something to be done in this direction by joining E.F.T.A. I suggest that we should not be satisfied with being a team in the second division of the European league. We should aim to be in the first division of the European league and to do all we can to get full membership of the Common Market. Of course, we must approach it with caution, but not too much caution because time is no longer on our side. We have just seen the fourth Annual Report of the European Economic Community, which shows quite clearly that the Common Market is not only a reality, but has proved to be a spectacular success.

I believe that it could be an even bigger success if Britain were a member of it. Already it has been able to speed up its timetable of lowering tariffs between the members of the Community. By the end of this year the tariffs between the members of the Common Market will be down by 50 per cent. and there will be no more trade quotas between them. They are starting to work out the common tariff which will be the wall round the Common Market. That is quite remarkable progress in the short period of four years and it puts E.F.T.A. on the spot. What is E.F.T.A. to do in face of that?

There is one thing it could do and which we must try to avoid. That is to start a trade war between E.F.T.A. and the Common Market. If we start to create two permanent blocs of that kind in Western Europe, it will have consequences which we dare not contemplate. We need not look quite so far as that; I do not think it necessary to do so. Something has to be done in the short term. British traders already find it necessary to get into the Common Market by various means in order to meet this unfair competition—unfair because of the fact that by the reduction of tariffs within the Common Market it is mad:, more difficult for our people to compete.

Very many points of view are held about what the effect on British interests will be if we go in. The only authoritative one which I have been able to find was in a report by Economist Research which estimated that these industries would definitely gain by our going in: motor vehicles, chemicals, wool, electrical engineering, general engineering, rubber manufacturers, steel, hosiery and clothing. Another list is given of further industries which would probably gain. Of course, there would be many other consequences. One I mention in passing is construction of the Channel tunnel. That would help our people even further. In fact it may become a necessity if we are in the Common Market, and certainly we would be more likely to get it.

We hear as a result of what has happened in the last few weeks that other countries are considering the question. We read in the Press this morning that the Irish Republic has announced its intention to join. We also read that some of our partners in E.F.T.A. have indicated that if we go in they will come in with us. I believe that they are all intending to seek negotiations to find what the prospects are.

What about the principal objections which have been raised? Some have been answered and I do not intend to repeat the answers which have been given. I think enough has already been said to disprove the assertion that this is a choice between the Commonwealth and the Common Market. I do not believe that is the case. I do not think that the Commonwealth need necessarily be badly affected, if affected at all, by our going into the Common Market. It depends on what arrangements the Government are able to make. Certain countries are regarded as associated territories. That happened to the overseas territories of certain present members of the Six. They have free access to the Common Market and certain other arrangements which are specified in Article 131 of the Treaty and Annex IV.

The self-governing Dominions, of course, present a rather bigger problem, but, at the worst, they could make treaty arrangements with the Common Market. It is all a matter of negotiation. I think it rather significant that, in recent days, some of the principal Commonwealth countries have indicated that they have no objection to our Government entering into negotiations.

There is also the fact that the Commonwealth countries nowadays do not necessarily try to trade or succeed in trading with this country to the exclusion of all others just because they happen to belong to the Commonwealth. The figures show that exports from the Commonwealth to Western Europe have increased and that exports from the Commonwealth to this country have decreased. My right hon. Friend the Member for East Stirlingshire reminded us of this when he said, quite rightly, that the people of the Commonwealth were fairly hard-headed business men and that the prices they are able to obtain will very largely govern where their trade goes.

It seems that the political objection is what causes hon. Members most concern. As is said in the E.E.C. Annual Report, economic unification is only one stage towards political unification. No one has attempted to disguise this. Some enthusiasts want a United States of Europe. This may or may not be a consummation devoutly to be wished for, but, of course, it could not possibly be achieved for very many years. What is wrong, particularly from the Socialist point of view, in trying to work towards some joint political arrangement with other countries in Europe? The present frontiers are entirely out of date and far too restrictive having regard to modern communications and so forth.

The Common Market has actually begun to set up certain political institutions. They are as yet elementary in character, although, in due time, they may become more influential. At present, there is a body which is nothing more than an advisory council consisting of members of the various Parliaments, nominated in some mysterious way which I have never been able to ascertain, and the great point is that that body will not be able to become a sovereign Parliament unless all the parties to the Treaty agree that this should be done. That is one reason why we ought to be there, to have our say in whatever future plans are contemplated.

On 17th May, the Lord Privy Seal spoke of the danger which faces us of a decline in political influence in the world at large and in our Commonwealth."—[OFFICIAL REPORT, 17th May, 1961; Vol. 640, c. 1389.] Undoubtedly, our political influence will decline if these European political institutions become more influential. This will happen if we are not there. I suggest that we ought to have our proper place in the new European political institutions.

As for giving up sovereignty, the natural reaction of anyone, of course, is that we do not want to give up any sovereignty. But, as the Prime Minister reminded us today, we have already given up quite a lot of sovereignty to the United Nations, to E.F.T.A., to G.A.T.T., to W.E.U., to N.A.T.O., to O.E.E.C. and so forth. The question of sovereignty should not stick in our gullet too much, particularly since any hon. Member of this House would, I think, feel fairly safe in promising to give up as much sovereignty as General de Gaulle would be prepared to give up.

Mr. John Biggs-Davison (Chigwell)

Is there not a difference between the European Economic Community and the other international organisations which the hon. Gentleman has mentioned in that there is no provision in the Treaty of Rome for leaving the Community whereas one can leave the other organisations?

Mr. Hynd

No one has yet contemplated the possibility of leaving the Common Market, but I do not think that it would be impossible if such a situation should arise. There is talk about not being able to unscramble omelettes. We know about that. I can hardly imagine that the situation would arise, but, if it did, the resources of diplomacy are never inexhaustible.

General de Gaulle made his point of view about sovereignty quite clear when, at a Press conference on 6th September last year, he said: What are the realities of Europe? What are the pillars on which we can build? In fact, they are the States—States which are certainly very different from one another, each having its own spirit, history and language, its own misfortunes, glories and ambitions, but States which are the only entities with the right of command and the power of being obeyed … In short, there is an opportunity to organise co-operation among men. That is what France proposes … This implies regular discussions in an Assembly formed by delegates from the national Parliaments. In other words, General de Gaulle does not envisage a federal assembly of Europe. He envisages some sort of confederation. I have no doubt that that is the kind of thing which will eventually emerge in the Common Market.

I have been rather surprised by some of the remarks coming from the benches behind me purporting to show that entry into the Common Market would be contrary to Socialist ideals. I believe that quite the reverse is true. Socialists have always believed that any good and just society founded on co-operative principles must be international in its application and that only thus could we build a peaceful and democratic world. In the Common Market countries, the trade unions, the free trade unions affiliated to the I.C.F.T.U., have played a full part. Two of the nine members of the European Coal and Steel High Authority are former trade union leaders, and the trade unions are represented on the Consultative Committee.

The support of the trade unions has been fully justified by results. Wages and conditions have improved in those countries. The principle of the forty-hour week has been accepted. The principle of holidays with pay, three weeks per year, has been accepted and is being applied. The principle of equal pay for women has been accepted and will be applied in all those countries by the end of next year. The trade unions in the Common Market countries want us to join. The Socialist parties in those countries want us to join.

My hon. Friend the Member for Houghton-le-Spring (Mr. Blyton) spoke of lower wages in certain countries. I am sorry that he is not in his place. I shall have great pleasure in presenting to him a booklet which, I think, will give him some information to the contrary. He expressed certain fears about nationalisation. Again, I hope to show him that the main industries in the Common Market countries are not all privately owned. Quite a number are nationalised industries. In any case, I do not think that the question whether industries are nationally owned or privately owned really affects the argument one way or another.

Although I say these things and make quite clear that I am in favour of the principle of trying to make proper arrangements for our country to enter the Common Market, I hope the House will not feel that I under-estimate the difficulties. They are enormous, and I know that the Government will have a difficult task. I wish that they were entering upon that task more wholeheartedly and with more nearly united effort. We may be divided on this side of the House, but in the majority that the Government will have in the Lobby tomorrow night there will be many hon. Members who, in the words of one hon. Gentleman, will be dragged straining and kicking into the Lobby. If the Government were more wholehearted about it they might have better prospects. I wish them all success in the negotiations, and I hope the result will be that this country will be able to play its full part in a reinvigorated Europe.

8.0 p.m.

Mr. Ronald Russell (Wembley, South)

For over four years I have had the honour of being a member of the delegation to the Council of Europe and to the Western European Union, and during the last 18 months we have had several debates on this issue, not only in those two Assemblies, but in joint sessions of the Assembly of the Council of Europe and the European Parliamentary Association, namely, the Parliament of the Six. In most of those gatherings, some of us have tried to explain the problems of the Commonwealth and the obligations to which we are pledged to honour.

I, for one, have tried to make it clear that I welcome the establishment of the Common Market, whether we have anything to do with it or not, and that I am thoroughly in favour of closer economic association between the Commonwealth and Europe. But I am certainly against our joining any political federation or political union in any circumstances whatever. I know that my right hon. Friend the Prime Minister said that there is nothing in the Treaty of Rome about political unity. That is perfectly true.

Having attended meetings at Strasbourg for over four years, I have certainly learned that most of the members of the delegations from the countries of the Six have political federation in mind in the end. We have had the statement about that from the king-pin of all, Professor Hallstein, the Secretary-General of the European Economic Commission. Therefore, for those reasons, I would prefer the action that the Government are now taking to be done under Article 238 rather than Article 237. Although that would give us no say in the politics of Europe, it would have the advantage that Europe would have no say in the internal affairs of the United Kingdom.

I know that there is this difficulty. I do not think that it has ever been established, because there has been no cause for it to be established, whether entry into negotiations under Article 238 could be initiated by an outside country, or whether it would have to come by invitation from the Six. The wording of the two Articles is different. It has never been put to the test. We could at least try to put it to the test by applying in that way. Perhaps the Minister who is to reply to the debate would say whether in fact it would have been possible for us to apply under Article 238.

So far, I do not think that anyone has mentioned the various communiqués issued at the end of the talks which my right hon. Friends have had between them with all the self-governing Commonwealth countries and also with the State of Singapore. These are very revealing documents, A few of the communiqués are very uninformative indeed, and possibly their lack of information is in proportion to the lack of urgency with which certain Commonwealth countries regard the Government's present action. These are Ghana, Nigeria, Malaya, Ceylon, Sierra Leone and Singapore in particular. Some of the others are very revealing, particularly the communiqués issued at the end of the talks with Canada, Australia, New Zealand, India, Pakistan, the Federation of Rhodesia and Nyasaland and the West Indies and also by one of our latest Commonwealth recruits, Cyprus.

The Australians have made it clear that they are worried about the division in the Commonwealth which may be caused by our applying to join the Six and its weakening effect on Commonwealth relations. In the communiqué with Canada there is this sentence: the Canadian Government … expressed grave concern about the implications or 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 the Commonwealth as a whole. These are very grave words indeed, and they fill me with alarm that that sentiment should be expressed by one of our Commonwealth Governments. Of all the Commonwealth Governments I think the Canadian Government are best entitled to say that, because they have made some attempt, and about the only attempt that has been made, to improve trade with Britain and with the Commonwealth.

One of the first actions of Mr. Diefenbaker when he became Prime Minister in 1957 was to suggest a switch of trade. That was countered in this country by the suggestion, which I can only call very clumsy, of free trade between this country and Canada. It was impracticable because of the Canadian industries, to begin with, and because of Canada's huge dependence on trade with the United States. Canada would have given a very great kick to the United States if she had abandoned the duties imposed on our goods and allowed them in free.

The communiqué with New Zealand shows that the Secretary of State for Commonwealth Relations had to make it clear that in any such negotiations the British Government would seek to secure special arrangements to protect the vital interests of New Zealand that Britain would not feel able to join the European Economic Community unless such arrangements were secured.

That is a most satisfactory assurance given by my right hon. Friend and, perhaps, the most comforting thing that has come out of these negotiations, conversations and statements up to the present. The New Zealand Ministers inserted in the communiqué a phrase saying that New Zealand welcomed this assurance and made quite clear the vital importance of the maintenance of "unrestricted duty-free entry" of products into this country. I emphasise "unrestricted duty-free entry" because we must look to the future as well as to the present.

India is anxious about the weakening of Commonwealth links—and coming from India that is a very welcome statement in one sense—and of ensuring the economies of developing Commonwealth countries. Pakistan, which is trying to diversify her economy so as not to be so dependent on jute and cotton, is also worried about the prospect of her semi-manufactured goods and wants to find markets for them.

I am worried about two other aspects of this problem. I am worried in case at the end of the negotiations we find ourselves in a situation from which we shall find it difficult to escape and that we shall be faced in this House with a proposition which my hon. Friend the Member for the Isle of Ely (Sir H. Legge-Bourke) mentioned in a Question on Monday, that in order not to weaken European unity, or some phrase like that, we must join the Common Market. I hope that some assurance will be given that in no circumstances will that position be reached and that we shall be faced with that dilemma.

I am also worried about the possible financial pressure from the United States. I know that from one point of view if we were to join the E.E.C. it would mean that the United States might face even more discrimination in Europe against her exports than she does now if we were to accept common internal tariffs. I think that the United States would promptly want to recompense itself for that by taking over the trade of the various members of the Commonwealth who would then be floating about leaderless in the rest of the world. I trust that the Government will resist without any hesitation any kind of pressure—moral, political, financial or otherwise—applied by the United States for us to join the Common Market if the Government do not think that it is in our interests to do so.

I agree with the statement that, if negotiations fail, we cannot just leave things as they are. I have never believed that we could. We should then be faced with the possibility of losing markets for our goods inside the Common Market, particularly when the Six have reached complete free trade, and the possibility of increasing competition from their goods in other parts of Europe. We should then do what I think we should have done first, namely, look to the Commonwealth, as the Canadian High Commissioner, Mr. Drew, reminded us only a few days ago, and do what we can to expand Commonwealth trade. I can claim to have advocated that ever since I have been a Member of Parliament. So far my words seem to have fallen on very deaf ears. I hope that, if these negotiations fail, the Government will give a strong lead in this direction and that Commonwealth countries will respond. Mr. Diefenbaker gave such a lead in 1957, but he did not meet with the response he should have met with.

Mr. Biggs-Davison

Would it not be better for the Government to start doing this now?

Mr. Russell

I was coming to that. I was going on to say that over this issue we are putting the cart before the horse. The Amendment says that we are entering this from economic weakness. We could enter it from much greater economic strength if we had put our Commonwealth house in order first and negotiated as a Commonwealth. We should have been much more welcome in Europe if we had done that and were stronger.

We are told that our proportion of trade with the Commonwealth has declined. That is true. The Prime Minister said this afternoon that the impact of Commonwealth preference is less than it used to be. This is also true. It is so simply because we have done nothing to strengthen it. Because we have been hamstrung, we have left Commonwealth preference either at exactly the same level as it was when it was instituted under its present system in 1932 or we have had to see it whittled away and reduced.

Mr. Stratton Mills (Belfast, North)

Has my hon. Friend any indication that the Commonwealth countries are willing to increase their trade with us? Have not the Commonwealth Finance Ministers' Conferences over the years, culminating in the Montreal Conference in 1958, all indicated perfectly clearly that their ideas are in exactly the opposite direction?

Mr. Russell

I do not accept that. I mentioned just now that when Mr. Diefenbaker became Prime Minister of Canada he suggested a switch of trade. He was willing to face something which was politically a little dangerous in Canada in order to try to switch some of Canada's trade from the United States to this country. Unfortunately, he did not meet with the right response. If we gave the right lead, bearing in mind that most Commonwealth countries have to find markets in this country, we should meet with a great response. In the early years of this century the Commonwealth countries gave the lead to us in trying to restore Commonwealth preference. They eventually met with response. This time it should be the other way round. We should give the lead. If we did, we should meet with response from many of them, though not necessarily from all.

Before we can do that we must revise G.A.T.T. I support what my right hon. and learned Friend the Member for Hertfordshire, East (Sir D. Walker-Smith) said. We must revise G.A.T.T. and be able to revise our Commonwealth preference system upwards as well as downwards. At the moment we cannot do it upwards. We can only do it downwards.

We could associate ourselves with Western Europe by having a three-decker tariff. We have had a three-decker tariff since we brought the E.F.T.A. into being. We now allow goods from the E.F.T.A. countries into this country at 70 per cent. of the rate of duty which corresponding goods from other countries carry. This is a new device for us. Except for sugar, we have never had a three-decker tariff, at least within living memory. This system is quite simple to operate. The only point about it is that under G.A.T.T. it is legal if it is temporary and will eventually lead to free trade but is completely illegal if it is made permanent. This is absolute and utter nonsense. We should have it revised so that we can apply the system not only to the E.F.T.A. but to Western Europe as a whole. In that way we could associate ourselves with Western Europe without any danger whatever of being involved in any political union or federation, and this would be to the benefit of both the Commonwealth and Western Europe.

8.16 p.m.

Sir Lynn Ungoed-Thomas (Leicester, North-East)

Tonight we are considering not just one matter of temporary political importance. We are considering the whole future course which this country is to take. We are considering a departure from the course which this country has followed in the past. We are facing in the long run the giving up of the independence and identity of this country in order to merge it with Europe. There may be a case for that, but it is clearly a case which should be proved to the hilt before this country can adopt such a course.

We are not merely concerned with short-term measures and remedies. We are not merely concerned with making up for the present deficiencies of the Chancellor of the Exchequer and his lack of courage in producing any long-term solution to our economic situation. We are concerned with a vital permanent decision affecting the whole future of our country. We cannot take this decision as a leap in the dark. We cannot take it on a hunch. This decision can be taken only if it is proved that this country and everything that it stands for will be undoubtedly benefited by taking the course which the Prime Minister has in mind.

I want now to consider the arguments which have been put forward. There is the economic aspect, and there is also the political aspect. The Prime Minister, very wisely from a political tactical point of view, concentrated all the attention upon the economic aspect. Only yesterday he made some concession to there being political considerations. Today be withdrew from that, and again emphasised the economic aspects and played down the political side. If it is the Prime Minister's case that on economic grounds we should go into Europe, we should be told exactly what the economic arguments are. What I have found about the economic arguments is that it is very easy to blazon economic arguments in general statements, but when it comes to proving the case which is made and examining what the argument is in detail they are not substantiated.

It is said that we shall be lowering tariffs inside Europe and raising them against other people outside Europe. I can understand the argument that if tariffs are lowered between us and European countries we shall have an advantage because we can export into Europe without having a tariff wall against us. That cuts both ways. European countries will have the advantage of exporting into this country without having a tariff wall in this country against them. That is the dilemma in which the supporters of the Economic Community find themselves. To get out of that dilemma—because they cannot show in detail, by taking industry by industry or commodity by commodity, that the balance is in favour of this country—they get out of it by saying that we shall benefit from competition. And that is where the competition argument comes in.

It is said that competition is what this country needs because our industry is inefficient: and that we need to go into the E.E.C. because we shall have the advantage of lowering our tariff barriers against our European competitors so that, by reason of that competition, our industries will have to make themselves more competitive and will, therefore, benefit from that. Really!

Let us consider the matter. If the advantage is from competition then obviously, of course, we can incur competition without going into the Common Market. We ourselves have control—because we are not yet in the Community—of our own tariff barriers and we can ourselves reduce them if we wish. But, of course, competition may be disastrous to save industries in this country and certain industries may be obliterated. I can understand that competition may be beneficial to some industries in some circumstances.

So we must consider the ways in which the interests of British industries might be affected. We must see which industries would benefit from competition and which would need protection, which would need lower protection and which would need higher protection and what degree of reduction of tariff barriers might be advisable in this or that case. That can be decided industry by industry or commodity by commodity, but what the Government are proposing by this procedure is a blanket reduction of tariffs.

There is just the same objection to a blanket reduction of tariffs as there is to the effects of a blanket rise of the Bank Rate. It is an undiscriminating weapon. Should we reduce tariffs by this blanket process against our European competitors—The Government's case is that our European competitors are more competent than we are. They are, therefore, in a stronger position to take advantage of a reduction of tariff barriers between us, instead of our being in the stronger position and having the advantage over them.

Surely if we are going onto Europe with a tariff wall around us, cutting us off from our friends outside and leaving us to the mercy of what, in the Government's argument, are stronger European industries inside, we should make certain that we are the winners by making ourselves stronger than are our competitors. But if we make ourselves stronger than they are before we go in, what is the case for going in. When we examine this in detail, we find that the case which has been made out for our going in on the tariff aspect completely disappears.

The rather wiser economists, who do not commit themselves to details, then resort to the cryptic word "dynamism". They say, "If we go into the Common Market—assuming, of course, we survive the competition—we would have the advantage of the dynamism of European industries." But what evidence is there for that? What is this dynamism about which we are told? Is it due to the Common Market?

Just after the war we saw the United States dominating the whole world's economy. No one would have said from 1946 to 1949 that the dollar would ever be a soft currency. No one would ever have thought that the dollar would so soon be threatened, but that is what has happened. The dynamism we had in Europe started before the Common Market came in. There is dynamism in Japan, without the Common Market, and in Belgium we do not have the dynamism there is in other countries.

In France we have seen the revaluation of the franc, which has immediately led to increased prosperity. In Germany we saw the position transformed overnight by the revaluation of the mark and the whole of Europe has had the advantage of Marshall Aid and in Germany—and this was the Chancellor's case the other day—the German balance of payments advantage is precisely equivalent to the British and American expenditure of foreign currency within Germany. In other words, if one transfers the British and American payments inside Germany to this country we should have the advantage which Germany now has as a result of that expenditure.

Thus there is no evidence at all to show that this dynamism is due to the Common Market. However, supposing it were? I can understand the argument that if one has a big trading area—a big Common Market—that Common Market as a whole might be more efficient because of the division of labour, industry and function within that big area and that it might be possible—depending on the size of the area and other economic considerations—for that to be advantageous to the area as a whole.

Let us assume for the sake of argument that Europe as a whole would be more efficient economically with the Common Market than without it. It does not follow from that assumption that this country, this particular part of Europe, would be more efficient. It does not follow, because the area as a whole has an advantage from it, that every part of that area has that advantage.

This Government must prove that Britain would have that advantage. The curious thing, however, is that we are the only country contemplating going into the Common Market, as it is called, or into the European Community, for economic reasons. The whole foundation of the creation of the Economic Community in Europe is political and not economic.

The Prime Minister says that we do not find a political objection in the Treaty of Rome. We are accustomed to double talk from the Prime Minister. I should like to know what he said to his possible partners within the Treaty of Rome. Has he told them the same as he tolls us; that there is nothing in the political future, the political cohesion, the political union of Europe? Is he double talking with them as he double talked with Sir Roy Welensky, and with us, over the Monckton Commission?

Of course, the object of all this exercise of the European Economic Community is a political one. Of course, the objective is, in the words, I think, of the Treaty of Rome itself, "ever closer union" of the countries of Europe. If we put down a stipulation that we would sign the Treaty of Rome without subscribing to its political objectives, and that if it were to result in ever closer union politically we ourselves would have the right to contract out—if, in fact, it were then physically possible to do so—does anyone think for a moment that the countries of the Six would accept it? Of course they would not.

This political union has been formed by countries defeated in the last war, countries disappointed in their own state, countries finding themselves inadequate far their own protection and for their purpose, and, therefore, having to form a new union in order to provide themselves with a sense of security and confidence that they lack. That is exactly what happened.

We ourselves have not had that experience; we ourselves have not had that need. We are not now, perhaps, the great political Power that we once were, but I believe us to be a tremendously important political Power. And our political power is not just the power of this country standing on its own; it is the political power of this country, and the influence that this country has by reason of being the founder and a member of the British Commonwealth of Nations.

The Commonwealth has become with too many people in the Establishment a dirty word overnight—the night of the Kennedy-Macmillan meeting. The Commonwealth, however, is an association, a voluntary association of free peoples, all brought up in the same traditions, all speaking the same language, all having the same democratic conceptions, all having the same methods of handling their affairs, and all having the same ideals.

The objection is made that the Commonwealth is not an organised association, in the sense that it has no binding constitution in which we can bind each other. Of course it has not. It is a free association of people, and we come to our conclusions by process of reasoning and discussion. It is none the worse for that. This is the first time that I have heard it advanced—and particularly from Conservatives—that there is an advantage in a rigid written constitution to which we have to adhere. Throughout the years, the emphasis, particularly from Conservatives, has been on the advantages of an unwritten constitution, a flexible constitution, a voluntary association of peoples, all proceeding by discussion and arriving at agreed conclusions. That, surely, embodies the very spirit of our democracy.

This association, the Commonwealth, has a unity, and I should like to see the response in Europe to a test of unity. I should like to see whether that response would, under the stress of war, be comparable with the Commonwealth response. We have seen with the Commonwealth countries a unity that brought them into a war on this country's side when they themselves were not obviously directly involved. Would we have that unity in Europe?

We had that Commonwealth unity displayed here, and rather dramatically displayed hare, on the occasion of the reopening of this Chamber, when we had the Speakers from all the Commonwealth countries coming here as part of our own democratic system which is implanted in those countries. There is unity in this, and not the less unity because it is not in a written treaty—a Treaty of Rome.

Further, we have the immense advantage of having in this Commonwealth coloured peoples. That, to my mind is one of the most important and vital aspects of it. We have had the trust conception of Empire. I have attacked aspects of it—there are aspects of its development that are thoroughly disreputable—but right from its earliest days—the days of Wellesley, of Cornwallis and of Warren Hastings—there has been as a continuous thread amongst the best of our people the conception of the Empire as being a trust to develop into a Commonwealth of all our peoples, including the coloured peoples. That has developed, and we are now, in this age, in our generation, seeing that development coming to realisation and all the members of the Commonwealth becoming self-governing communities. This is exactly the time when these people most need understanding, encouragement, assistance and friendly help. This is the very time when this Government, with its imperialist conception instead of a Commonwealth conception, chooses to abandon these people. This is a loss, not only to us, but to the whole world.

I agree most strongly with the observations of my hon. Friend the Member for Cannock (Miss Lee) that we are facing here in this state of the world a tremendous conflict between the Communist Powers and ourselves. How is this conflict to be averted? Communism is not just a military power. Incomparably more important, and what makes it so dangerous, is its hold upon the minds of men. Traditional Europe, as represented by the European Economic Community countries, gives no spiritual reply to that spiritual challenge.

In Europe we are pitting against the Communist countries an absolutist conception as against the Communist absolutist conception, and we are in Europe trying to establish and set up a military reply to what is essentially a political and spiritual challenge. What we have prevailing in the pressure being brought to bear upon this country to go into Europe is what I think all parties in this House have condemned, and that is the Pentagon conception of the reply to the Communist challenge. It is ominous that the watershed in the Government's decision in this matter—the decisive moment—is the Kennedy-Macmillan meeting.

Of course, America would have advantages from our going into Europe. She would have the advantage of having us in as part of the military organisation of Europe, to the same extent as Germany and France are in. [Interruption.] Oh, yes, the case made is that it is necessary for us for military reasons to go into Europe to strengthen Europe, politically and militarily, in answer to the Communist challenge. America would have the advantage of our weakening all our ties with the Commonwealth. Do not let us run away from that. New Zealand has already spoken about the possibility of getting alternative markets in America, as contrasted with this country. With us in Europe, and with stronger ties with Europe than with the Commonwealth, Canada would be abandoned to the United States of America.

We all remember the position about A.N.Z.U.S. and what happened there. The various countries of the British Commonwealth would fall into the American lap, but with one vast difference—that it would fall in separate pieces, it would have none of the spiritual democratic cohesion which it now has. It would lose the advantage of being the tremendous political, democratic and spiritual force which it is at the present time. It would merely have the separate units of the British Commonwealth, and not the Commonwealth as a whole.

It is inconceivable that we can go into Europe without weakening our ties with the Commonwealth. Would the Prime Minister be prepared to say that we will form no closer association with Europe than with the Commonwealth, or does he contemplate that we should have a far stronger association with Europe than with the Commonwealth, that we should become primarily a European Power and not a Commonwealth Power at all, that our association with the Commonwealth would disintegrate into separate bargains here and there?

We have had the shameful spectacle of the Prime Minister sending round his commercial travellers to the Commonwealth to sell the Common Market idea. He has told us that this was done for the purpose of consultation, but one thing which has emerged perfectly clearly from all the reports is that there has been no consultation at all. There has been a tremendous effort to bring pressure to bear upon the members of the Commonwealth to agree to our going into the European Economic Community. If he were in a position to say that they agreed, would he not have said so today?

The whole political idea embodied in this proposal is one which is alien to the mind of this country, is ruinous to our Commonwealth development and, in my view, so far from contributing to the peace of the world, goes most strongly against it.

8.42 p.m.

Mr. John Harvey (Walthamstow, East)

I am not old in the service of this House, and yet in the few years in which I have been here I can remember that it is not so long ago when, if hon. Members on this side of the House had said some of the eloquent things that have been said this afternoon about the Commonwealth by some hon. Members opposite, it would have been regarded as old-fashioned Toryism. I welcome this new esteem which the Commonwealth has suddenly found among some hon. Members opposite, even though I cannot help wondering what are the reasons for it.

We have heard a most forceful presentation by my right hon. Friend the Prime Minister of his case. We have heard a very middle-of-the-road speech from the Leader of the Opposition. If in future months or years anybody should quote his speech of today as selectively as he quoted some speeches that my right hon. Friends have made on earlier occasions, he will always be able to say "Yes, but in that same speech I also said so-and-so." He will be right, whatever happens in the future trend of negotiations, because he has seen to it that he has made the sort of speech which must come down the right way however the future goes.

Indeed, the right hon. Gentleman has restrained his party in the Division Lobby from showing precisely which way it might like to go. He has in effect apparently taken the advice of Lord Attlee in the matter and said, "There is no need to help the Government with this." Perhaps there is not. Perhaps the Government can carry their own responsibilities. But to avoid in this way accepting their own responsibilities on the benches opposite does them no great credit. No doubt, it is politically wise of them to leave until some future date a definite decision on an issue which certainly exercises all our minds. It may be politically wise, but it is no real substitute for effective leadership and responsibility.

Apart from the two speeches that I have already mentioned, we have had a most eloquent speech from my right hon. and learned Friend the Member for Hertfordshire, East (Sir D. Walker-Smith), a speech which certainly must have given us all to think, and a very able and well presented speech from my hon. Friend the Member for Winchester (Mr. Smithers). I think that all these speeches might repay reading again in HANSARD tomorrow.

One might at this stage ask: which of them spoke for Britain? We might have a variety of views on that in the House tonight. If one looks at the various public opinion polls, it would appear that those who favour our going into the Common Market might speak for anything up to 70 per cent. of Britain. If one looks at the Gallup poll in particular, one will find, averaging it out over the last three years, that about 40 per cent. apparently think we should go in, about 20 per cent. seem to think we should stay out and about 40 per cent. do not know. If only somebody could mobilise the "Don't-knows", they would make a pretty formidable force.

On the other hand, the one point that we must bear in mind—my right hon. Friend certainly has to bear it in mind—is that with such a large element of "Don't know" over such a very vital subject, it is of the utmost importance that in the weeks ahead the Government should accept the responsibility for ensuring that the people do know a very great deal more about all the pros and cons involved than they do today.

So I hope that if any White Paper is in due course published as a result of the negotiations that I assume we are now going to enter into, it will not only deal with these negotiations but will seek to amplify and clarify all the various issues which have been discussed in the House this afternoon and are being discussed in the country and which add up to a great deal of uncertainty and confusion about priorities, results, duties, rights, benefits and responsibilities.

This is a responsibility which the Government really must accept. It is not good enough to leave it to the newspapers, even though the Daily Telegraph and the Daily Herald have produced very good, valuable and most helpful documents. The Daily Herald must have sent to some hon. Members opposite a document which sent to, I think, all hon. Members on the Government side of the House, and if hon. Members opposite had taken the Daily Herald seriously, some of the Aunt Sallies which they have set up this afternoon and then knocked down could not possibly have been set up.

I do not want to labour this theme. I do not want to set up Aunt Sallies of my own. I want to make only one major point. In my earlier post-war years I had the honour of serving as Chairman of the Young Conservatives in the Woodford division when my right hon. Friend the Member for Woodford (Sir W. Churchill) was Leader of the Opposition and then again Prime Minister. I always remember the great speech that he made in Zurich in 1946 when he said: We must turn our eyes away from the horrors of the past towards the future. If Europe is to be saved from infinite misery and, indeed, from final doom, there must be an act of faith in the European family and an act of oblivion against all the follies and crimes of the past. I would not know, from their murmuring, whether or not that view is shared by Members opposite, but I hold it strongly and I feel that in an act of faith this country has its part to play and its quota of leadership to contribute.

In my few years of political life and experience I have always held the view that my right hon. Friend the Member for Woodford has time and time again sought to enunciate—that there need be no conflict between our interests in Europe and our interests in the Commonwealth. I worry a great deal lest today some people are trying artificially to manufacture such a conflict because, for one reason or another, they would prefer that the strength that is Britain's be not added to the generating strength of Europe. I feel that it is time that we in this House faced fairly and squarely the fact that the identity of interests that exists between the countries of free Europe and the Commonwealth is a very considerable one indeed.

The hon. and learned Member for Leicester, North-East (Sir L. Ungoed-Thomas) referred to the fact that one of the great advantages of the Commonwealth was that there were coloured people in it. But so are there coloured people in the Common Market as a result of the arrangements which the French have made for their own colonial States and the successor States to former colonial States.

Sir L. Ungoed-Thomas

Are they full members or second-class members?

Mr. Harvey

They are not second-class members. They are associate members. I firmly believe that we should today seek, if we can, to find a way to reconciling the interests of the Commonwealth and of Europe, and that, as I understand it, is what my right hon. Friend the Prime Minister has proposed to the House. I believe that the House has made it abundantly clear that there are certain terms that we would not be, prepared to accept, but that does not mean that we should not make the effort to see whether a solution is possible on terms that would be reasonably acceptable to the British people, to the people of the Commonwealth and to our E.F.T.A. partners.

Those who seek to destroy the possibility of reaching such an agreement in advance of negotiations are themselves showing a sense of irresponsibility which could serve their country ill in the years that lie ahead. That virtually is all that I want to say tonight. The Government are right in seeking to see whether the gap can now be bridged.

If the gap cannot be bridged, let us by all means take stock of the situation which will then face us and show some vigour and firmness of purpose in seeking a possible alternative. But at the moment it is right and proper to see whether we can bring about the identity that I believe exists and could flourish between our interests as a European Power and our interests in the Commonwealth and across the Atlantic.

8.54 p.m.

Mr. Roy Jenkins (Birmingham, Stechford)

At one stage when the hon. Member for Walthamstow, East (Mr. J. Harvey) was speaking, I thought that he might be winding up the debate, so widespread and gracious were the compliments he paid to his hon. Friends who have spoken. At another stage, I feared that he alone of the back benchers who have spoken in this great and important debate was not going to tell us unequivocally where he stood on this issue. However, I am glad that towards the end of his speech he cleared up that last doubt and came out on what I broadly regard as the right side—the pro-Europe side—of this controversy.

From both sides of the House some extraordinary arguments have been deployed against our moving towards Europe. Some of them have been deployed with great force and passion, and the speech of my hon. and learned Friend the Member for Leicester, North-East (Sir L. Ungoed-Thomas) was an example, as was that of the noble Lord the Member for Dorset, South (Viscount Hinchingbrooke). Out of what has been said have emerged two main arguments with which I would like to deal.

The first is the Commonwealth argument. Without question, and partly because of the Government's extraordinarily inept handling of the question of our relations with the Commonwealth, this has become the main and most widely held objection in the last few months to our going into Europe. I do not expect that the Secretary of State for Commonwealth Relations will agree with me, at least not publicly, but with due respect to the hard job he had to do, I can think of no more inept way of taking action about this than the mission of the three Ministers to the Commonwealth, asking members of the Commonwealth for any objections which they could think up without placing firm proposals before them.

That apart, my belief is that the Commonwealth objection as it has been deployed in the House and in arguments outside has been largely based on a false premise. It is based on the premise that the Commonwealth could afford us, through an alternative source, the same advantages which we could get by going into Europe. I do not believe that it possibly could.

What is the economic advantage of our going into Europe? We think—and I put it no higher than that at present—that the advantage which we would get is that we would become part of a large, unified and rapidly growing market. On the basis of that, we would see not a vast diversion of our own exports to Europe—it is irrelevant to say that only 14 per cent. of our exports go into Europe and therefore that market is unimportant —but, as a result of becoming part of a large, rapidly growing unified domestic market, we ought to achieve greater adaptability, greater specialisation and a greater "edge"—all the things which British industry is now so notably lacking. It would enable us to improve our competitive position not merely or even most importantly in Europe itself, but in the third market and in the Commonwealth itself, where we are steadily losing ground to our competitors.

That is the crux of the trade argument for going in. It does not mean that by going in we would automatically solve our present economic difficulties. I cannot believe that even the Government think that. There is still a great deal to be done, but going in would tend to make us do many of the things which the Opposition have been advocating, rather than going on from crisis to crisis, which is the danger for this country in future.

At any rate, the argument for going in is that we would improve our general competitive position. If we could do that, we could break through the core of our present troubles, which is our inability to expand at home for a sustained period without running into balance of payments difficulties.

If we could do that, we would be in a position to serve the real economic long-term needs of the Commonwealth, which are that we should be a steady source of long-term capital and a steadily expanding market which does not have to contract its market to the Commonwealth and which is a market not merely for traditional temporary foodstuffs from the white Dominions, but for tropical products and for simpler manufactured goods from both the white and coloured Dominions. That is the essential rôle which we must play towards the Commonwealth.

On the other hand, the Commonwealth offers us no basis alternative to Europe for making that essential break through and it does not do so for the perfectly simple reason that there is no possible prospect of the Commonwealth becoming a large, unified rapidly growing market. There is not such a prospect, because the Commonwealth has not shown much growth in the last few years.

Secondly, and much more important, the last thing that Commonwealth countries are prepared to do is to give United Kingdom manufacturers a free rein in their markets. Whether it is the old white Commonwealth, Canada or Australia, or whether it is the new Commonwealth, whether it is Ghana or Malaya, none of these countries would be prepared to remove their tariffs and give us free entry. This is possibly right from their point of view because of their present state of development. They, too, are interested in building up their industries. This being so, any idea of a Commonwealth Customs Union is out of the question, for the simple, but completely adequate, reason that nobody in the Commonwealth would support it.

To look at this issue in terms of a free choice between an economic union with the Commonwealth and an economic union with Europe is to look at it in false terms. I believe, too, that if we stay out of Europe we will go on being economically weak. If by 1970 we are still a sluggish, crisis-ridden nation unable to provide substantial resources of development capital to the Commonwealth, whatever sentimental arguments the Commonwealth may produce during the months of negotiations, they will turn their backs on us far more than if they find that by being in Europe we are economically prosperous and dynamic and able to offer them the economic leadership which to some extent they need. The kind of action which the Government think is fair, like refusing Mr. Nyerere £8 million, will do the Commonwealth far more damage than going into the Common Market.

The second point, perhaps applying myself principally, but not exclusively, to hon. Members on this side of the House, is what one might call the special dilemma which the Left in this country is creating for itself over going into Europe. It is the question of how one can reconcile one's ability to promote social progress, and enable Socialism to have an effectve left-wing Government in this country, with the traditional internationalism of the Left. I apply it mainly to hon. Members on this side of the House, though the noble Lord the Member for Dorset, South surprisingly came out as a defender of our ability to produce, autarchic Socialism in this country against the machinations of, I forget who it was, but I expect it was something to do with President Kennedy.

Let us begin with that. To raise this issue is to raise a dilemma between the internationalist tradition and the desire to preserve at all costs one's ability to do what one wants in this country. It is generally presented in terms of Europe with a good deal of anti-Adenauer and anti-de Gaulle undertones at the same time, but to some extent the same difficulty would arise were one to go into almost any group one is likely to go into. Certainly Atlantic Union would not make it very much easier. Certainly going into a close tie-up with those new heroes of the extreme Right and Left in this country, Mr. Diefenbaker, Mr. Menzies, and Mr. Holyoake, would not solve this problem. I think that even so far as E.F.T.A. is concerned, leaving aside the special embarrassment of Dr. Salazar, the attitude of the Scandinavian Prime Ministers might be rather cool for my hon. Friend the Member for Nelson and Colne (Mr. S. Silverman) on certain issues.

Mr. S. Silverman

I take the point. Does not my hon. Friend realise the difference between an association with people who do not wish to interfere with our own planning of our own economic resources, and entering into a Common Market which would necessarily entail limitations upon our freedom of action in our domestic field, which association with the Commonwealth or with Scandinavia does not?

Mr. Jenkins

All I was endeavouring to point out is that to take this point to its logical conclusion means that one is not against going into Europe at present but one would be against even surrendering one's sovereignty to almost any conceivable grouping that one could think of. It must be obvious that if we say that we must at all costs preserve our right to do what we want with our own, whether it is done for imperialist reasons or in the name of Socialism, or simply for xenophobic reasons, this requirement of an absolute right to do what one wants with one's own is bound to produce an inward-looking and a contracting-out attitude which is at variance with the international outlook of the Labour movement.

I want to examine this point in more specifically European and more practical terms. Is it suggested that by entering the Common Market Britain would become more of a Tory nation? Is it suggested that she would be less capable of advances towards social progress than she would be if she stayed out? Whatever view we may take about certain policies of Dr. Adenauer and General de Gaulle, anyone who looked at the situation in Europe at the present time and said that from a left-wing point of view this country was far in advance of the Europe of the Six must have gone to sleep in 1949 and not woken up since. He would be living in a world of twelve years ago.

Let us consider what has been done in Europe. We have the most rapid rise in national incomes shown by France, Germany and Italy; the fullest of full employment shown by France and Germany; a model system of economic planning in France; highly successful nationalised industries in France; a very developed system of retirement benefits, which makes anything that we have in this country look a disgrace, in Germany, and excellent family allowances in France. In many respects the Europe of the Six has far more to offer the people, and has shown a greater achievement in the last ten years, than anything we have been able to get in this country.

When I heard my hon. Friend the Member for Houghton-le-Spring (Mr. Blyton) talk as though the wage standards in Europe were now on a sort of coolie level, I began to wonder where I was.

Mr. Blyton

I hope that my hon. Friend is not trying to be funny. If we add our wage rates to our welfare benefits we find that the standards of Britain are higher than those on the Continent.

Mr. Jenkins

Certainly. My hon. Friend made a powerful and impressive speech, but I am surely entitled to reply to some of the points in it with which I do not agree. Taking that factor into consideration, Britain still has just the highest wage rate, but for how much longer will that be so? The rate at which the Europe of the Six is catching up is enormous. German wage rates rose by 11 per cent. in 1960. From the point of view of under-cutting labour costs the cost of employing labour, which includes, in France and Germany, social security surcharges, is also relevant, and not merely the actual wage rate.

Mr. A. C. Manuel (Central Ayrshire)

Does not my hon. Friend agree that if we have real wages which are higher than those which generally apply in the Common Market countries it is because of the real bargaining power of our trade unions? Does not he think that there is some danger that they will lose that bargaining power if we join the Common Market, because the trade union concept is not accepted by it?

Mr. Jenkins

I do not want to enter into an argument with my hon. Friend the Member for Central Ayrshire (Mr. Manuel), but I am willing to make a firm prediction that, unless something very surprising happens in this country, in five years' time wage rates in Germany will be substantially higher than those in this country.

Miss Lee

There will be a crisis here under the Tories. That is my prediction.

Mr. Jenkins

I listened to the speech of my hon. Friend the Member for Cannock (Miss Lee) and I am sure that she will be prepared to listen to mine.

My point here is that in the first place it is greatly possible to exaggerate the lack of progressive content in the Six. It is enormously possible to exaggerate the extent to which going into the Six would inhibit a Labour Government from doing what is wanted. Such an action would have no effect on any nationalisation. The coal and steel industries in Europe, as the House is aware, have already been in a community for nine years. Nor would it affect the mixed pattern of public and private ownership. I know of nothing at all in the articles of the Coal and Steel Community or E.E.C. which would prevent from being carried out any measure of nationalisation thought desirable.

The other argument, or the further development of the argument advanced by some people, is that it does not matter about these detailed questions of planned social services, of wages or whatever it may be. The great danger to us is getting ourselves mixed up with the political image of the Six. What would do us harm, it is argued, from the point of view of our leadership in Asia and Africa, is the France of Algeria and Bizerta, the Belgium of the Congo, and the Germany of intransigent irredentism.

I think that there are two things to be said about this argument which is a powerful one and a most difficult argument to meet. I think that we are inclined to adopt a Pharisaical attitude. We are too inclined to believe that we are not as other men; that we are more self-righteous and that everyone will accept us at our own valuation, and that if we rub our hands unctuously enough, people will not notice the dirt of Suez and Cyprus.

The second and, I think, the very real danger to this country is the belief that nations all over the world are waiting to be led by us. This new imperialism is only slightly less dangerous than the old imperialistic belief that everybody else in the world was waiting to be dominated by us. I believe that most of the new nations do not want to be led or to be dominated. They want to get on with the conduct of their own affairs and to obtain as much help from us as possible. They will not be impressed by a Britain, unable to solve its own economic problems, standing on the sideline waiting to be asked by someone to lead them somewhere. That is the danger which will confront us if we stay out.

I think that the Government have little about which to be proud in the way in which they have handled matters in the last four years. I think that the President of the Board of Trade has little to be proud of regarding the statements he has made. I do not even know how the Prime Minister feels about it, because only a few weeks ago the right hon. Gentleman was rebuking the leader of the Liberal Party in violent terms for having had the temerity to suggest exactly what the Prime Minister is now proposing. However, I think there is no doubt that it would be impossible for the Government to put up an effective defence to the argument that if, as I believe is right, we propose to go into Europe, it would have been far better had we done so two or three years ago when we had at least the semblance of some economic strength.

There is a grave danger that in conducting these negotiations the Prime Minister may say too many different things to too many different people. But, even allowing for my great lack of confidence in the ability of the Government to conduct the negotiations with success, I still believe, and believe firmly, that it is right for this country to go into Europe.

The Commonwealth objection to staying out is a false one. There are more things involved in going in than diversion of trade, or even our particular rate of growth. I believe that this country at present—encouraged to a large extent by the Government—is suffering from a general ineffectiveness of performance and a national mood Which is half that of misplaced complacency and half that of growing lack of self-confidence. There is a real danger that we shall go into a kind of drab decline rather detached from the main currents of life in the world, blaming other countries for our misfortunes and occasionally deluding ourselves, but no one else, with illusions of grandeur. I believe that the best prophylactic against that rather dismal happening is that we should go into Europe.

9.16 p.m.

Mr. John Farr (Harborough)

It is with a great deal of surprise and a certain amount of pleasure that I find myself tonight in a similar position to that of the hon. Lady the Member for Cannock (Miss Lee) and the hon. and learned Member for Leicester, North-East (Sir L. Ungoed-Thomas). I am less surprised to find myself in a similar position to that of the hon. and learned Member, because not only is his constituency in the same county as mine, but the arithmetic he used is more in keeping with the arithmetic I have employed in arriving at the same position.

It is surprising to me that the word "agriculture" has hardly been mentioned at all in this debate today. One of the chief objections I have to this country joining the Common Market under the present terms of the Treaty of Rome is that British agriculture will be threatened and the prosperity—indeed the existence—of our farming community will be in jeopardy.

The Common Market, under the terms of the Treaty of Rome, provides that agricultural support as laid down in our Agriculture Acts of 1947 and 1957 will no longer be tolerated. Certain economists calculated the other day that the removal of the British subsidy which brings down the price of food in our shops would have the effect of increasing the price per head by only about Is. 0½d. per week. I have not heard another comparison or another figure given, but I took certain pains last week to look up some of the fatstock marketing prices and guarantees which the Government are paying. I found that roughly for every 3s. that a British farmer received for fat cattle in the sales this month the Government provided Is. and 2s. was paid by the consumer. It does not need a mathematician to work out that if that is transferred in the same ratio a 15s. leg of beef, when the agricultural subsidy is removed, will cost 22s. 6d. in the shops.

Another very important consideration is what is to happen to horticulture. Our British horticultural industry is struggling today. It is protected by a strong tariff wall which is absolutely necessary. If we look at the terms of the Treaty of Rome we find that internal tariffs for agricultural and horticultural products will be abolished. The proposals of the Common Market agriculture commission are very vague about what would be done with horticulture. It says that the rules of competition for horticulture will be governed by quality and productive capabilities. How can British tomato growers compete with tomato growers in Italy and France, where they have the natural climate to help them and they can produce tomatoes as a field crop and not as an expensive heated crop under glass as has to be done in this country?

Last Friday, I had the pleasure of addressing my local branch of the National Farmers' Union, and I found that the vast majority of farmers attending that meeting were disturbed at the prospect of this country joining the Common Market. They were dismayed at the possibility of losing the support embodied in the 1947 and 1957 Agriculture Acts. The message they gave me to deliver here today was that the vast majority at that meeting was against our involvement or entanglement in the Common Market.

Mr. J. M. L. Prior (Lowestoft)

Would it not be equally true to say that at other times when my hon. Friend speaks to farmers' meetings he finds that they are no more satisfied with the present system of support than they are at the prospect to which he has referred?

Mr. Farr

I am interested to hear that my hon. Friend knows as much, if not more, about what goes on at National Farmers' Union meetings in my constituency. I shall have to pay more attention to them in future.

The Motion before the House refers particularly to our applying for entry into the Common Market under Article 237. I regret that we are not to apply under Article 238. I am very worried about the effect which our membership of the Common Market would have on Commonwealth trade. The Commonwealth trade which we still enjoy, though, perhaps, with weakened Imperial Preferences, is about the only tangible link we now have to hold the Commonwealth together. There are some nebulous, vague links, connections and sinews which help to hold our vast family together, but the one factor of substance on which we can still put a finger is Commonwealth trade.

I am appalled to hear hon. Members on both sides say, or imply by not saying, that it does not really matter if we erect tariff barriers against New Zealand, Australia and other of our Empire countries and it does not really matter if we abolish tariffs between this country and the Common Market countries of Europe. What does it matter, they ask, if instead of New Zealand exporting butter and lamb to this country we have a lot of dumped Dutch produce here, or if we import large quantities of French grain instead of Canadian grain? If we join the Common Market, we shall have to erect a common tariff wall outside the Common Market over which all our Commonwealth imports will have to climb but through which Common Market imports, especially of agricultural produce, will come without hindrance.

It is said that it will be a wonderful boon to British industry if we join the Common Market. Our manufacturers—there are many industrialists here tonight, particularly on the benches behind me—say that there will be a wonderful opportunity for our companies to compete in a home market not of 52 million people but of 220 million. How wonderful will be the opportunities, they say, for us to sell our manufactured goods. Many of them do not give a thought for the smaller firms. Moreover, if I may say so with respect, there are many who may have the smile wiped off their faces after a few years within the Community.

I took the trouble to inquire the other day at what price certain popular foreign motor cars are sold in their country of origin and at what price they are sold in this country, the difference, of course, being accounted for by shipping. Purchase Tax in this country and a very large tariff. I shall not go into details now except to mention two cars made on the Continent and exported all over the world.

I take first the Simca "Etoile", a French motor car. Its price in the country of origin today, excluding T.V.A. and local taxes, is £332. In this country, its price is £779, and even at that price one sees a lot of them about. The price of the Volkswagen in Germany today, including turnover tax, is £425, but a buyer in this country has to pay £739 for one. If the tariff is removed there will be such a demand for and such a flood of foreign cars coming into this country that many of our large car manufacturers, who apparently regard the Common Market as a ripe plum for picking, will be very sorry that we ever entered into negotiations with the Common Market.

There was a debate in the House at about 3 or 4 this morning on immigration. My hon. Friend the Member for Louth (Sir C. Osborne) and my hon. Friend the Member for Liverpool, Kirkdale (Mr. N. Pannell) had an exchange of conversation. They were mainly concerned with the immigration of Jamaicans and other coloured citizens from the Commonwealth. What they did not turn their minds to, and have not turned their minds to, and what, I submit, we should be turning our minds to now, is the fact that if we join the Common Market under its present terms by 1970 any citizen of the Common Market countries will be able to come to this country provided that he has a job to come to. He will have to apply to no one and will come here automatically as of right.

As the Common Market stands today, a citizen of France wishing to take a job in West Germany has to wait for three weeks while that job is advertised. At the end of that period, if a national of West Germany has not taken the job, the Frenchman has a right to take it. By 1970, there will be no such waiting period. I submit that we should be far more concerned about the possible curtailment of our right to allow citizens of our Commonwealth into this country. If we join the Common Market, we shall not have the right of free immigration into this country of Commonwealth citizens. We shall have to apply to Brussels. It will not be possible to say a word if people flock in from other Common Market countries to take advantage of the very high employment rates that we have enjoyed over the last fifteen years, and which, if we do not join the Common Market, I submit that we shall continue to enjoy.

One hon. Member earlier tonight referred to the fact that despite the number of criticisms made by hon. Members on both sides of the House of the Government's Motion, there was no concrete alternative before the House for us to consider. He made the point, a very valid one, that it is no use going into bargaining or consultation unless one has an alternative. It is no use going up to someone and asking him to lend one 6d. without somehow giving the impression that one is not really stony broke and done for if he turns one down. The same principle applies to our negotiations with the Common Market.

I beg of my right hon. Friends on the Front Bench not just to give the impression that they have an alternative for us to fall back on, but to have a really practical alternative, embodying the Commonwealth, and embodying the countries of E.F.T.A. in the Commonwealth to make a larger British and part-European and Commonwealth community which can act together as an economic bloc. We should then have a bloc which would dwarf the Common Market and many other nations of the world.

I should like to see our relations with the Common Market countries remain on the most friendly basis and, perhaps, negotiations concluded between the bloc that I am suggesting and the Common Market, whereby perhaps a most favoured bloc in terms of the old most-favourednation clause would be evolved. The most friendly links could exist. If we could hammer out such an association of like-minded people—people whom, with respect to our European friends, we understand who are our own kith and kin, who have stood beside us in our victories and sorrows. in peace and war—we should make a great contribution towards the negotiations which are shortly to be commenced.

I have heard, as other hon. Members have, of the Expanding Commonwealth Group. Is not this something for the Group to get hold of? Is it not a bone for its members to chew over? Is not this one way of expanding the Commonwealth to make it work? This could be an association of the E.F.T.A. countries with our own under-developed countries in the Commonwealth. They could be economically associated, trading together. This is material for members of the Expanding Commonwealth Group to consider.

I do not approve of our application under Article 237. I should approve of an application under Article 238. I leave the House with the thought that we should seek to make progress towards having a living alternative if our negotiations with the European Economic Community are turned down. We should seek to build up something on which we could pin our hopes and fall back on, should the concessions which the Prime Minister will try to get from the E.E.C. not be granted.

9.31 p.m.

The President of the Board of Trade (Mr. Reginald Maudling)

I want to deal with some of the important points which have been made in this remarkable and unique debate.

Mr. George Brown (Belper)

The right hon. Gentleman should also deal with his own past.

Mr. Maudling

I need not answer that interjection, because it is as irrelevant to the argument as most of the right hon. Gentleman's interjections.

Before dealing with the points which have been made, I want to recall the terms of the Motion which the Government have put before the House. We ask the House to support 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. We ask for support in finding out whether this can be done. The only way in which it can be done is by making such an application.

The House should record a clear view on this point, because it is of very great and possibly historic importance. The Opposition Amendment and the speech by the Leader of the Opposition were a little disappointing. The Opposition seek to substitute for the words "supports the decision" the words "notes the decision". That is a little inadequate in relation to what is required of the House of Commons and of both major parties. The country is entitled to know whether the Government have the support of the House of Commons in making this decision. Anyone who objects to this decision is clearly declaring his unwillingness to contemplate joining with our European neighbours in any circumstances whatever. [HON. MEMBERS: "Article 238.] I will come to the point of whether it should be under Article 237 or Article 238 later. My right hon. Friend the Lord Privy Seal will also deal with this point tomorrow. The main answer is the clear one that association under Article 238, as compared with membership under Article 237, would lead to all the disadvantages, on the one hand, while not on the other hand giving us the great positive advantages which would flow from membership.

It is important that we should have the support of the House in finding out what can be done. This can only be found as a result of negotiations. The ultimate decision is not to be taken today. The decision is whether we inquire what the circumstances will be, in order that we can make a final decision, upon which the House will be consulted.

Mr. William Baxter (West Stirlingshire)

About what has the hon. Gentleman been negotiating during the last four years?

Mr. Maudling

In 1957 and 1958 I was trying to negotiate the Free Trade Area. In 1959 I was engaged in negotiating the E.F.T.A. Since then I have not been engaged in negotiating with Europe.

The main points which have been made during today's debate have been concerned, first of all, with the political significance and, subsequently, with the economic significance of any agreement we may reach with Europe. It is clear that in modern conditions one cannot wholly disentangle economic and political considerations. The coherence of any Group, politically and economically, is intermingled.

If one looks at the remarkable development in co-operation in Western Europe since the war—there is O.E.E.C. and the European Payments Union, to which the right hon. Gentleman the Leader of the Opposition made a very fine contribution—that has been the basis of much of the political coherence of Western Europe. Similarly, the Commonweath. Surely the Commonwealth is both a political and an economic association, and I doubt if it would be wise or realistic to try to suppose that one could take one aspect of the Commonwealth and ignore the other.

In modern conditions these two aspects—economic and political—inevitably are tied together and where one has an economic division one is bound to have a political division in the long run, and that is one of the strongest arguments at the present time for trying to achieve a greater economic strength in Western Europe.

If it is true that economic and political considerations are intertwined, it is also true that the treaty of Rome, which we are discussing, is, as my right hon. Friend said, an economic Treaty. If one looks at its terms one sees that it is concerned with establishing a common market and that it is also concerned with the other provisions that are necessary in order to ensure that a common market functions efficiently.

There is a provision, it is true, for an Assembly sometime, elected by direct suffrage, but that can only be brought into effect by unanimous agreement all round. We are, therefore, dealing with a Treaty which is essentially an economic one. It has, it is true, very great political overtones, but here, I think that there has been quite a change which should be observed in the European scene in recent years. The motives which led the people who sponsored the idea of Western European collaboration were, in many cases, a step towards political federation. That is true, and it was, and should be, recognised.

But we have seen in the last year or two the development of the European patrie of General de Gaulle and it is clear, I should have thought, that the Governments of the Six are not supporters of the conception of a political federation. Therefore it is fair to say that neither by the terms of the Treaty itself nor by the expressed views of the Governments concerned in the Community would our membership commit ourselves in any way to ultimate political federation. As the view has often been expressed—and this is important—it would be wrong for us to accept obligations, either expressed or implied, which went further than the country is prepared to accept in present conditions.

Another important point which has been touched upon by several hon. Members is the question of sovereignty, to which my right hon. and learned Friend the Member for Hertfordshire, East (Sir D. Walker Smith) paid particular attention. Clearly, this is a very important problem indeed. It is absolutely true that the Treaty of Rome contains surrender of freedom of action different in kind, and possibly different in degree, from that seen in other treaties. It would be fair to define sovereignty as freedom of decision and action.

Certainly, in the Treaty of Rome, if we were to become partners in it, our freedom of action would be considerably circumscribed. The Commission has powers that, I think, are probably unprecedented in any international body, and there is the point that the Treaty of Rome is envisaged as being permanent, and without particular duration. I agree that these are important points to be taken into account, but we must look at the realities of the derogation of sovereignty that is involved, try to assess precisely what is involved and set that against the other commitments that we and any nation of the modern world have inescapably to undertake.

I do no believe that it is open for any nation in the world community, any more than it is open for an individual in the national community, to claim complete freedom of decision and action. Whether it be a treaty that we sign, like G.A.T.T. or N.A.T.O., or whether it be the mere obligations of international law, it inevitably means some restriction on our freedom of action and decision. I should have thought that this was particularly true in the military field, which is of such tremendous importance. By our adherence to any alliance we are bound to be placing some restriction on our freedom of action.

The question we must look at on this occasion is how much we should be circumscribed in our freedom of action if we were to join the Community, and how much this particular disadvantage should be judged to be when balanced against the great advantages of joining a European system.

We should certainly lose control over our tariffs and our commercial policy in relation to a considerable part of our trade, but, of course, if we were successful in getting satisfactory arrangements for the Commonwealth this loss of fredom of action would be concerned only with about a quarter of our world trade at most, because three-quarters of that trade rests within the Commonwealth and within Europe.

Also, if we lost our freedom of action—

Viscount Hinchingbrooke

Does that mean that Australia and New Zealand and Canada, if they come in, are to be given power over their own fiscal future whereas we have to surrender ours?

Mr. Maudling

I do not think that was the point I was on. I want to come to the Commonwealth a little later.

I said that if we have proper arrangements to meet our points about the Commonwealth, the Commonwealth and Europe together represent about three-quarters of our total trade. Therefore, although it is a disadvantage to lose our freedom of action over a common tariff and a common commercial policy, we must look at the matter in perspective and see how much, in practice, we should be losing compared with, as I have said, the advantage of participating in a really large single market.

The limitations that are involved on our freedom of action should we join the Community are all expressly designed to ensure the efficient working of the Community. If we look at the various provisions of the Treaty about State intervention, subsidies, establishment, restrictive practices, dumping, and so on, we see that all these are aimed at ensuring that a single market works effectively, and we must ourselves squarely face the fact that if we do go into a single Common Market, it is in our interests that that Common Market should work effectively and that there should be rules of competition and institutions to ensure that it should work to the best advantage.

A number of right hon. and hon. Members have referred to E.F.T.A. We have, of course, a great and a solemn responsibility to our colleagues in E.F.T.A. Lt was formed, I think, for two purposes; partly, as my hon. Friend the Member for Winchester (Mr. Smithers) said, because the members of E.F.T.A. felt that a further fragmentation of Europe would take place unless there was some cohesion amongst the industrialised countries outside the Common Market.

We also formed it, I think, because we felt that we had many things in common, and that an association of the seven countries with a population of 90 million people with, on the average, very high living standards, formed in itself a valuable and important single market.

We had those two purposes in mind, and in our communiqué at the London meeting we said quite clearly that in any negotiations the members of E.F.T.A. would co-ordinate their actions and remain united throughout the negotiations and that E.F.T.A. should be maintained at least until satisfactory arrangements had been worked out in negotiation to meet the various legitimate interests of all members of E.F.T.A., and thus enable them all to participate on the same date in an integrated European market. In reply to the question which the right hon. Gentleman asked me, that is the Government's view, and it remains the Government's view.

Mr. G. Brown

What about the Commonwealth's view?

Mr. Maudling

I will come to that.

The problem about negotiations involving the E.F.T.A. countries is that, while we all have difficulties in the context of the Treaty of Rome as it stands, these difficulties tend to vary. We have our special problems of the Commonwealth, while some of our E.F.T.A. partners have their special problems, such as neutrality and the constitutional position of Austria and Switzerland.

Therefore, the solutions that may be found in the long run to bring us all together into a single European system may be, in individual cases, differing solutions. I think this is logical, because different problems lead to different solutions. Therefore, it may be a question of a series of negotiations involving different countries.

The point is that we are partners and intend to act as partners. This is not a question of giving one person a veto over another. This is not how partners talk. I want to emphasise that the spirit of understanding and co-operation among the Seven countries of E.F.T.A. is very remarkable indeed. We have worked together for a long time. We understand one another and we trust one another. We realise that we have a responsibility to one another, as partners, to ensure that everyone's legitimate interests are properly settled before a final settlement is accepted by any one. That undertaking, which we gave certainly remains true.

The right hon. Gentleman also asked me about the Commonwealth, and I am glad he did, because I want to refer to it, and it was a point referred to by the right hon. Gentleman the Leader of the Opposition earlier. We have given the same undertaking to our Commonwealth partners and to the other E.F.T.A. countries, namely, that we will not join the Community unless special arrangements have been worked out in negotiations to protect their essential interests. I do not think that any country, either in the Commonwealth or in E.F.T.A., wants to make our decision for us. They recognise that they have no right to do that, nor would they claim to do that, because they do not want to take upon their shoulders the solemn responsibility that will rest upon this House when the time comes to make a decision. They do not want to take our decision for us, but they want to have, and have, the assurance that before we take our decision, we will be satisfied that special arrangements have been worked out in negotiations to protect their essential interests.

Of course, there will be a difference in procedure between the E.F.T.A. countries, who will themselves engage in negotiations with the Community, and the Commonwealth countries, whose interests it will be our responsibility to bear in mind, and whom we will consult closely and continuously throughout the negotiations. But the principle of the obligation remains the same in each case.

Mr. Harold Wilson (Huyton)

The right hon. Gentleman is making a very important point. Is he saying, quite categorically, in respect of each Commonwealth country, that there is the same commitment and the same pledge to meet their interests as there is in the case of each E.F.T.A. country?

Mr. Maudling

The undertaking in each case is collective, and not individual, obviously. I will read again the words I used, because they were carefully thought out. We have given the same undertaking to our Commonwealth partners and to the other E.F.T.A. countries, namely, that we will not join the E.E.C. unless special arrangements have been worked out in negotiations to protect their essential interests. That is where we stand, and it is perfectly the same in both cases. That is a rather deliberate statement of the position in answer to the point raised by the right hon. Gentleman.

Mr. G. Brown

I understand what the right hon. Gentleman has now said, but do I also understand that in the case of E.F.T.A. the undertaking has been given to each country that we will not join unless arrangements have been made to protect the interests of each individual E.F.T.A. country? If that is so, it is not collective. Are we giving it to each individual Commonwealth country, or are we saying that it is not for each individual E.F.T.A. country?

Mr. Maudling

In this matter, we are treating our Commonwealth partners and our E.F.T.A. partners in precisely the same way. I do not think I can say more, I have explained twice already what the position is, and if the right hon. Gentleman will look at HANSARD, he will see what it is.

The next point I want to came to is the very important one of the Commonwealth trading system and how it is affected by the provisions of the Treaty of Rome. The important point that we all have to consider is, first of all, as my hon. Friend the Member for Winchester said, how we can best serve the Commonwealth inside or outside the European Community. That surely is the basic problem. When we look at the question of investment which is of such importance, what is of the greatest significance to the Commonwealth is in what circumstances the United Kingdom will be able to provide the maximum flow of investment capital to the Commonwealth countries. Clearly the conflict between our present Commonwealth system and the Treaty of Rome arises in the field of the common tariff and of the common agricultural policy, and in the provisions for a common commercial policy.

I should like to say one or two things about our Commonwealth trade to outline the problem that has to be faced. We think of Commonwealth trade at the moment very much in terms of the sales that the Commonwealth makes in our market here. That clearly is of very great importance indeed. Temperate foodstuffs are obviously the largest individual item, but manufactures are also of importance to India, Pakistan, Canada and of growing importance to Australia. Raw materials and tropical foodstuffs are all of importance. The Commonwealth is bound to be concerned both with the question of the Common external tariff which, unless provision is made for the Commonwealth, will apply automatically to Commonwealth products, and also with the nature of a common agricultural policy, because on the nature of that policy will depend the extent to which members of the Community import foodstuffs from other countries outside.

That is a very good example of the general principle of the desirability, if we are to enter the Community, of entering at the formative stage before policies have too much crystallised. That is the first aspect of Commonwealth trade—the sales that they make in our markets which are in some cases of overwhelming importance to the Commonwealth countries concerned.

Then there is the second aspect; that is our sales in Commonwealth markets, which must not be overlooked. Although the volume of our trade with the Commonwealth has fallen, it is still 40 per cent. of our trade, and my own belief is that the period of steep decline that we have seen has had historical reasons and may well not continue. I hope to see an improvement. We are still accorded preference over about half our exports to the Commonwealth of an average of 10 per cent. or 12 per cent. It is very important indeed for our engineering, chemical and other industries, and is clearly a matter which we must bear in mind in our discussions just as much as we bear in mind Commonwealth sales in England.

Then there is the rather more intangible question of the habit, system and tradition of Commonwealth countries in economic matters. I believe this to be a very precious thing—something which we must preserve and regard not merely for its economic and commercial value but for the strength and sustenance which it puts into the whole Commonwealth. Therefore, when looking at the problem, which is a very tough problem, of reconciling the Commonwealth system with a European settlement we must have regard to these three aspects of our Commonwealth trade and try to find solutions to them.

On one matter I would not agree with some of my hon. Friends. I do not think we should regard the Commonwealth as an alternative to a satisfactory solution with Europe. Of course, we should aim at expanding our trade with the Cornmonwealth—I quite agree—but I do not think the idea of a Commonwealth free trade system is really a practicable proposition at all, as several people have said it is, simply because the Commonwealth countries with their developing industries could not in present circumstances contemplate opening their markets freely to products from industrialised Britain.

The other reason for not looking at the Commonwealth as an alternative to Europe is that it is fundamentally wrong to do so. We must not get into the frame of mind of choosing between the Commonwealth and Europe. It would be tragic if this country were forced to make that choice. For some years now I have seen the various interests, difficulties and problems which sway across this rather difficult stage, but one thing that I have been convinced about is that there is absolutely no fundamental reason at all why we should not reconcile our membership of the Commonwealth system with our proper place as a European nation, which we are. One of the advantages of the Treaty of Stockholm and the E.F.T.A. is that we achieved in that Treaty precisely that result. I do not say for a moment that the system would be appropriate or applicable to a wider European system involving the Six, but it can be done. It has been done once with goad will, and I am convinced that it can be done again.

Also, we must look at the problem of our trading relations with Europe as an opportunity and a challenge. The opportunities are immense. We shall have much competition, I quite agree. There will be rules for fair competition, and that is very important. I do not agree with the hon. and learned Member for Leicester, North-East (Sir L. UngoedThomas) who shed so many tears for the companies and businesses in this country which will go under in the face of fierce competition. I think that the great effect of going into a wider European market will be that the efficient firms will prosper and the inefficient will go down. That, surely, is precisely what we must see in this country if our economy is really to expand and our growth is to be more rapid.

There will be vigorous competition, and, certainly in the first instance, it may well be that the strain on our balance of payments will be increased by our having to face a considerable volume of imports, but in the long run we can in modern conditions hope to expand the technical basis of our industry and harness all the possibilities of modern industrial methods only if we can operate in a very large market.

I think that the opportunities and the challenge of a single European market for British industry are very great, and the difficulties if we stay out are also great. It is true that Europe is taking only about 14 per cent. or so of our overseas trade at the moment, but it is a very rapidly growing market. I agree with those hon. Members who have said that the growth was taking place before the Treaty of Rome was signed, but I think the Treaty of Rome has stimulated it. If we stay out, we shall lose great opportunities far trade there.

Also, outside Europe we shall be facing a new competitor throughout the world, and in the Commonwealth as well, with an industrial base on the same scale as the United States but with wages not three times ours but about the same as ours; and the competition to be met from a body such as that would be formidable indeed. So I think we must recognise that the advantages of going into Europe are great and the difficulties of staying out are equally great, but what we must not say is that, whatever we do, we must go in at any price. This alternative is equally untrue. There is the whole of the rest of the world for us to make a living in if we want to do so and have to do so. If we are efficient and really competitive, we shall prosper outside, but we shall prosper even better inside. [Interruption.]

I am sure that it should be posed, to such as want to listen, that the advantages, political and economic, of going into a European system can be enormous, but we do not have to go in regardless of the cost. Therefore, we have to find out what the conditions are upon which we can join, which is precisely what the Government are asking support for this evening.

Mr. G. Brown

Might I ask whether the right hon. Gentleman is for the Motion or the Amendment?

Debate adjourned.—[Mr. Hughes-Young.]

Debate to be resumed Tomorrow.