HC Deb 07 March 1962 vol 655 cc405-16

The following Question stood upon the Order Paper:

65. Mr. BELLENGER

To ask the Lord Privy Seal whether he will now make a statement on the negotiations which formed the subject matter of recent ministerial meetings in Brussels with the European Economic Community.

The Lord Privy Seal (Mr. Edward Heath)

With your permission, Mr. Speaker, and that of the House, I will now answer Question No. 65.

A fortnight ago I undertook to make to the House as full a statement as possible and I hope that this will be for the convenience of the House.

At the ministerial meeting in Brussels on 22nd February, we discussed for the first time the problems of agriculture and the temperate foodstuffs from the Commonwealth. Discussions have, therefore, now begun with the European Economic Community over the whole range of problems involved in our entry into the Community. For our part, we hope to be able to maintain the momentum of the negotiations in all their aspects.

At this meeting, I repeated that the United Kingdom fully accepted that the Common Market must extend to agriculture and trade in agricultural products; and that we were prepared to participate in a common agricultural policy.

At the same time, I experienced the view that some adaptations of the decisions already reached by the European Economic Community would be necessary, because, for example, the accession of the United Kingdom and other countries would alter the supply and demand situation, and because it would be necessary to provide for the smooth and progressive harmonisation of the present United Kingdom food and agricultural system with the new system which would be established in an enlarged Community. We naturally sought arrangements under which our position would be taken into account by the Community in working out regulations for those commodities on which agreement has not yet been reached.

I again emphasised the need for arrangements to meet the essential interests of Commonwealth countries in this field. The Community was asked to accept that Commonwealth countries would need to feel that in the future they would have the opportunity of outlets for their agricultural produce comparable to those they now enjoy.

After the general discussion between Ministers a number of problems were remitted to the Deputies for further study and report. They include problems relating to the form of the common agricultural policy, assurances to farmers in the enlarged Community—including the question of annual reviews—the need for a special transitional period for the United Kingdom, the problems connected with the Commonwealth, and the financial arrangements for the common agricultural policy.

I will now refer to some of the subjects dealt with at previous meetings.

The House will recall that in my opening statement on 10th October last, I said that, whilst we were ready to accept the structure of the present tariff as the basis of the common tariff of the enlarged Community, we would wish to single out some items for special treatment. We have in these talks suggested that in a limited number of cases the Community tariff should be reduced to nil.

A Working Party has been continuously at work in this field. It has now largely completed its task of studying the problems which arise, except in the case of processed foodstuffs. These will be studied separately against the background of the discussions on the common agricultural policy. The Working Party has examined the balance of production and consumption in an enlarged Community, including the United Kingdom, and has reviewed the economic considerations which should influence tariff levels, taking particular account of Commonwealth trade in the products concerned.

Another important problem concerns the relationship between the Community and the less developed countries of the Commonwealth. A general examination of this problem has been taking place for some time on the basis of statistical material especially assembled by the European Commission and our own delegation. This shows the division of the exports of each less developed Commonwealth country and territory between the United Kingdom, the European Economic Community and other countries.

The material indicates whether these exports are mainly affected by the common external tariff, by the present arrangements for the association of overseas territories, by the common agricultural policy, or by some combination of these factors. There has not yet been any detailed discussion about the particular Commonwealth countries and territories to be given the opportunity of becoming associated if they so wish.

The United Kingdom delegation has explained the nature of the Commonwealth interest and its effect on any arrangements made to replace those in the present implementing Convention which expires at the end of this year. There have recently been more detailed discussions about the problems of Commonwealth countries identified as being mainly affected by the common external tariff, namely, India, Pakistan, Ceylon and Hong Kong. A detailed review of the pattern of trade in the manufactures of these countries and of the restrictions at present imposed on them is now under way.

A special study has been made of problems arising in the field of exports of manufactured goods from the developed Commonwealth countries—Canada, Australia and New Zealand. This has been based on a statistical analysis of the trade in manufactured goods between these countries and the United Kingdom. The Working Party concerned has also listed some possible solutions to the problems that have emerged, which would not be inconsistent with the Treaty of Rome.

There has also been a thorough study of the articles of the Treaty of Rome concerned with Economic Union. This has taken place together with an examination of the detailed regulations, decisions and directives which have been adopted by the Community to implement the Treaty. The object of these discussions has been to enable us to assess how far these detailed measures would be suitable for application to the United Kingdom without any adaptation.

I would like now to refer to two further matters. I need not remind the House of the terms of our obligations to our partners in the European Free Trade Association. The United Kingdom is not negotiating on their behalf but we are, of course, concerned to remain in the closest possible contact with them. One of the main purposes of the meeting of the European Free Trade Association Council which I attended last week in Geneva was to review progress in the negotiations begun with the Community in Brussels: this was part of a continuing process of consultation among the countries of the European Free Trade Association.

Secondly, we have now formally applied for negotiations with a view to joining the European Coal and Steel Community and the European Atomic Energy Community. This will enable negotiations with these two communities to begin as soon as it is mutually convenient. Moreover, it shows our desire to maintain the momentum of the negotiations as a whole.

Finally, I might sum up the position we have reached in the negotiations in this way. A great deal of ground has already been covered. A lot of the work has been unspectacular, but it has been necessary before we can formulate solutions to the complex problems which arise in every field. Businesslike procedures have been established in a co-operative atmosphere. I hope that it will be possible for the tempo of the negotiations progressively to increase.

Mr. C. Pannell

On a point of order. Is there any precedent for an Answer to a Question of this length, read at such speed? Will you bear in mind, Mr. Speaker, that if any supplementary questions from this side of the House matched the length of the dissertation to which we have just listened they would undoubtedly evoke a great many interruptions from hon. Members opposite? We think that this is an abuse.

Mr. Speaker

The Minister was asked to make a statement. I do not think that there is any limit set by the rules of order to the length of the statement that he can make, and if the right hon.

Gentleman read it slowly, of course, we might have less time.

Mr. Heath

To continue, some work of analysis remains to be completed, but I am hopeful that we shall then move on to the consideration of possible solutions. In this way a broad picture, covering the whole range of the negotiations, will begin to emerge.

Mr. Bellenger

The whole House will welcome the right hon. Gentleman's progress report, if I might call it such. [HON. MEMBERS: "No."] Obviously, the whole House does not want so to call it, but I do.

Is the House to understand from the procedure adopted by the right hon. Gentleman today, in Answer to the Question, that on further occasions, after Ministerial consultations, he will give the House an extensive report as he has done today?

Secondly, does the right hon. Gentleman envisage that the guarantee that the Government gave to the agricultural industry in this country, that the deficiency payments system would not be altered during the period of this Parliament, will not be changed as a result of the negotiations which are going on in Brussels?

Mr. Heath

As I have already said, I am anxious to meet the convenience of the House in this matter. Apparently, this long statement this afternoon was not entirely to the convenience of the House.

I will consider the position after each Ministerial meeting. The undertaking which we have given to the farming industry will remain.

Mr. Gaitskell

The right hon. Gentleman has made a long and important statement which the House will wish to study carefully. Will he take up with the Leader of the House the possibility of a debate, when we could probe these things a little more satisfactorily? Meanwhile, I have four questions to put to the right hon. Gentleman.

First, I understand that what has been happening so far has been studies of the various problems which arise in connection with our possible entry into the Common Market. Can he tell us whether, the period of study being, so to speak, now over, we are about to move into the period of negotiation?

Secondly, would not the right hon. Gentleman agree that the best solution of the problem of agricultural products from the temperate zone would be one which, in effect, threw open the European market more than it is at present to these products of the temperate zone members of the Commonwealth, even if they thereby lost something in the British market? Is that the view of Her Majesty's Government? If not, could he give us a clue about what they consider to be the correct solution of the problem?

Thirdly, there is the problem of the tropical products and the products of under-developed countries. Is it not the problem that the French Government contemplate discriminatory tariffs in favour of their ex-colonies, which they would treat on the basis that they were associated members of the Common Market? Are the French Government prepared to enlarge the list of associated members to cover all the ex-colonies of this country so that they might enjoy the same privilege? Would the right hon. Gentleman regard that as a satisfactory solution? Or is there not a tremendous amount to be said on broader, international grounds, for free entry to the Common Market for all products of under-developed countries?

Finally, can the right hon. Gentleman say anything about political developments? I understand that there have been certain conversations among the Six about development towards some kind of a federal system. Have they made progress? Where do we stand?

Mr. Heath

My right hon. Friend the Leader of the House has, of course, heard the right hon. Gentleman's request for a debate. The House has been very patient in understanding the difficulty of making information public while these negotiations are going on. I think that many right hon. and hon. Members will realise the difficulty of debating them in every detail during negotiations.

I take note of the right hon. Gentleman's comments about the possible solution to the problem of foodstuffs from the temperate zone. These things are very much in our minds, but, again, they are a question of negotiation between the countries concerned and the European Economic Community.

The position which the right hon. Gentleman described in dealing with tropical products is that of the existing arrangements between the associated overseas territories of France and the Community. What is being discussed at the moment within the Community is what the new nature of these arrangements should be after 1962. So it is not a question of creating discrimination of this kind, but of existing arrangements which hold at the moment.

As the right hon. Gentleman knows, we have broad arrangements with our own territories. What will be discussed in due course in the negotiations is the nature of the future arrangements for association after 1962 and the part which our own territories can play in them.

The right hon. Gentleman also raised the question of worldwide arrangements for tropical products. Various suggestions have been put forward about this, and the House will also realise the difficulty of securing worldwide arrangements in a very short period of time.

The right hon. Gentleman also referred to political arrangements. The Fouchet Commission is still working on this at an official level. The arrangement is that when a greater degree of progress has been made we shall have an opportunity of giving our views fully to the members of the Six.

Mr. Gaitskell

Can the right hon. Gentleman give an assurance that it is understood that no change in the present political arrangements can or will be made without the consent of the British Government? In other words—if I may put it the other way—is there any danger that the six present members of the Common Market would reach arrangements among themselves which we would then have to accept if we went in? Can he clarify that point?

Can the right hon. Gentleman also answer the more general question? Have we now reached the end of the study period and the commencement of negotiations? In which sort of order are these subjects to be taken in the negotiations?

Mr. Heath

There is still a certain amount of work of analysis and provision of statistical information to be done. The work on agriculture, having started so recently, is slightly behind the other aspects I have described, but there is no decision about the order of the work, because it is being carried on by the Deputies and working parties on all the subjects I have mentioned.

As for the Fouchet Commission, so long as we are in the position of not being a member of the Community we cannot govern the actions of the Community in carrying on its deliberations. At the moment, the arrangement is that we shall have an opportunity, after the work at official level, of stating our views at Ministerial level.

Mr. Fell

Can my right hon. Friend precisely define what the words "comparable outlets" for goods from the Commonwealth mean? If he can, will his definition be the accepted legal definition for this country?

Mr. Heath

This is where we enter the difficult sphere of detailed negotions, on which, at the moment, I am unable to give the House detailed information.

Mr. H. Wilson

In regard to the European Free Trade Association, can the right hon. Gentleman say something about the attitude of the European countries in relation to the neutrality question? Will he make it quite clear that, as far as we are concerned, the exclusion of the neutral countries from association under Article 238 on grounds of political neutrality is quite unacceptable and, if persisted in, will mean that the conditions stated in the House of Commons Resolution of 5th August, 1961, will operate, and that we cannot ourselves enter unless satisfactory safeguards have been provided for E.F.T.A. countries?

My right hon. Friend raised the question of the Fouchet Commission. The right hon. Gentleman and I recently appeared in a television programme which was not fully reported—perhaps fortunately. Will he confirm what I understood him to say then—that there can be no question of this country joining the Community and accepting federal or supranational commitments in relation to foreign policy or political questions generally, and that this would require a separate treaty? Have the Government reserved their position on this question?

Mr. Heath

I do not think that the right hon. Gentleman would expect me to express the views of other European countries. There are three neutral members of E.F.T.A. The position of Her Majesty's Government is clear. We are bound by the obligations of the Stockholm Convention and the communiqués which we signed in July this year in London and Geneva, which is that the other E.F.T.A. countries must have the opportunity of satisfying their legitimate requirements and that these should all be taken into account at the same time. These are our obligations and we adhere to them.

As for the Fouchet Committee, the right hon. Gentleman is absolutely right. Such obligations would require a new treaty and that treaty would have to be accepted unanimously by all members.

Mr. H. Wilson

The right hon. Gentleman did not fully answer the question about the Fouchet Commission. [HON. MEMBERS: "Oh."] This is very important. The six other countries concerned in E.F.T.A. are partners to whom we are morally and treaty bound. Since they regard their legitimate interests as safeguarded only by association under Article 238, will the right hon. Gentleman make it plain that, if that association is refused on military or political grounds—on the ground of neutrality—our attitude under the Resolution of the House last August will still apply?

Mr. Heath

The E.F.T.A. countries have applied for membership under that Article. In the case of Austria, association was not mentioned—deliberately so, as a matter of policy. I confine myself to saying that the legitimate requirements of E.F.T.A. countries for which we are seeking arrangements must be met. That is our obligation.

Mr. Ridley

While welcoming the Government's decision to apply for membership of Euratom and the Coal and Steel Community, may I ask my right hon. Friend to confirm that we would not join these organisations unless the main negotiations were successful?

Mr. Heath

That is true. I understand that it is the view of the Six that countries unable to join the Common Market are unable to join the Coal and and Steel Community or Euratom.

Mr. P. Williams

May I press my right hon. Friend a stage further on the phrase "comparable outlets for Commonwealth products"? While understanding the difficulty of the definition of this phrase at this moment, either it was put into the statement to mean something, or it is meaningless mumbo-jumbo. If it is a meaningful phrase surely the House is as entitled to have an explanation of this as it was courteous of my right hon. Friend to make a statement this afternoon at all?

Can my right hon. Friend say whether this phrase will allow free entry of Commonwealth products into this market for all time, and will not be on a declining or time limit basis? Secondly, will he give an undertaking that there will be no discrimination in the future against Commonwealth products, preferring the position of European products?

Mr. Heath

The phrase is meaningful, but to describe it one has to relate it to many circumstances and to individual commodities. It is, therefore, not possible to give a detailed answer separate from the negotiations. Secondly, the request was for the long term as well as for the short term.

Mr. Wade

The Lord Privy Seal used the expression "supply and demand situation". Can he explain what is meant by that? Secondly, the right hon. Gentleman referred to the transitional period. How long will the transitional period be? Thirdly, if this long statement is a statement of progress I welcome it, but I support the plea of the Leader of the Opposition that there should be some opportunity for debating it if only to allow a chance for an expression of views by those hon. Members who wish progress to be made, and those who do not.

Mr. Heath

As regards the supply and demand situation, I think that the House wild appreciate that if, for example, Denmark and ourselves were to become members of the Community, in some agricultural products it would mean the addition of the largest producers and, as far as the United Kingdom was concerned, the largest consumer. It would, therefore, produce a different supply and demand position in the enlarged Community as a whole.

On the transitional period, I made plain in the Paris statement that we were asking for a longer transitional period for British agriculture, and this was the matter I put forward again at the last Ministerial meeting and which is now to be discussed by Deputies.

My right hon. Friend the Leader of the House heard the hon. Member's request for a debate. At the same time, I hope that the House, having given us authority to enter into these negotiations, will allow us to continue them and understand that one cannot give detailed information about particular aspects of the negotiations.

Mr. Walker

Is my right hon. Friend aware that there is a danger of declining Commonwealth trade during the period of these protracted negotiations? To prevent that, will my right hon. Friend say whether or not the safeguards he is attempting to obtain for the Commonwealth are of a permanent nature, or are to be subject to a time limit? Will he not refer me to the Paris statement, as there is no mention in that statement of whether they will be permanent or temporary?

Mr. Heath

As I understand, the Commonwealth is anxious to maintain its trade with us and to increase it. We are equally anxious to increase Commonwealth trade wherever possible. This has always been the Government's policy.

I will send my hon. Friend a note of the particular points in the Paris speech where we requested that Commonwealth arrangements should be not only for the transitional period but the full Common Market period. And that, again, was the request on the agricultural commodities—temperate foodstuffs—which I put forward at the last Ministerial meeting in Brussels.

Mr. Rhodes

Has the question of the import of Commonwealth manufactures now passed the exploratory stage, and if so, how far?

Mr. Heath

I said in my statement with regard to Commonwealth industrial goods that possible solutions have now been put forward which are not in conflict with the provisions of the Treaty of Rome.

Mr. Mendelson

Concerning the work of the Fouchet Committee which is being carried on at official level, does not the right hon. Gentleman agree that it is essential for the House to know precisely where the political intentions of the Six and their plans for supranational organisation are leading to before the House can make up its mind about the economic provisions of the Treaty? Is it not essential that a full report should be given about the working of the Committee before we can go any further?

Secondly, would not the right hon. Gentleman agree that while there are difficulties in giving too many details whilst he is conducting these negotiations, it is not possible to go on for too long without debating the progress report that he has given today and other future reports?

We are asked questions about these matters by our constituents all the time, and it is not possible for the Government to keep them in a field of mystery and finally appear in the House with a fait accompli.

Mr. Heath

There is no question of a fait accompli in this House. The Government have given full undertakings to the House and will carry them out.

As regards the Fouchet Committee, it is not possible to hold up these negotiations. Her Majesty's Government have no desire to hold up negotiations for entry into the Economic Community while awaiting the outcome of the Fouchet Committee's deliberations, if that is what the hon. Gentleman was suggesting. I see no reason for that. We have been informed of the substance of the Fouchet Committee's draft on which it is working, and, as I have told the House, as soon as it reaches the position of Ministerial discussion there will be meetings between the Six and ourselves at which we can express our view.

Several Hon. Members rose—

Mr. Speaker

Order. There is a difficulty about discussing this matter without a Question before the House.