EUROPEAN ECONOMIC COMMUNITY

HC Deb 10 November 1966 vol 735 cc1539-51

The Prime Minister (Mr. Harold Wilson)

With permission, I will now answer Question No. Q4.

The position of Her Majesty's Government in relation to the European Economic Community was stated in the Gracious Speech on 21st April in these terms: My Government will continue to promote the economic unity of Europe and to strengthen the links between the European Free Trade Association and the European Economic Community. They would be ready to enter the European Economic Community provided essential British and Commonwealth interests were safeguarded. This policy, which was itself a reaffirmation of that laid down in the Labour Party election manifesto, has also been reaffirmed on many occasions in this House, in the country and abroad, notably in the speech of my right hon. Friend the Foreign Secretary, then First Secretary, at Stockholm on 6th May.

On 21st April, 1 informed the House that we had made certain Ministerial arrangements to ensure that any opportunities that do present themselves in Europe can be quickly seized upon so that they can be evaluated…", and I said that it would be our intention to probe in a very positive sense the terms on which we would be able to enter the European Economic Community and its related organisations".—[OFFICIAL REPORT, 21st April, 1966; Vol. 727, c. 90.] In recent weeks the Government have conducted a deep and searching review of the whole problem of Britain's relations with the E.E.C., including our membership of E.F.T.A. and of the Commonwealth. Every aspect of the Treaty of Rome itself, of decisions taken subsequent to its signature, and all the implications and consequences which might be expected to flow from British entry, have been examined in depth.

In the light of this review the Government have decided that a new high-level approach must now be made to see whether the conditions exist—or do not exist—for fruitful negotiations, and the basis on which such negotiations could take place.

It is vital that we maintain the closest relations with our E.F.T.A. colleagues. Her Majesty's Government therefore now propose to invite the Heads of Government of the E.F.T.A. countries to attend a conference in London in the next few weeks to discuss the problems involved in moves by E.F.T.A. countries to join the E.E.C.

Following that conference, my right hon. Friend the Foreign Secretary and I intend to engage in a series of discussions with each of the Heads of Government of the Six, for the purpose of establishing whether it appears likely that essential British and Commonwealth interests could be safeguarded if Britain were to accept the Treaty of Rome and join E.E.C. In the light of these discussions the Government will then take its decision whether or not to activate the arrangements for negotiating for entry, and what the appropriate time for such negotiations would be. Commonwealth Governments as well as E.F.T.A. Governments have been informed and we shall maintain the closest degree of consultation with them throughout.

The House will agree that—provided the right conditions for negotiations are established—it is vital that we should enter only when we have secured a healthy economy and a strong balance of payments, with the £ standing no less firm and high than it is today.

I want the House, the country, and our friends abroad to know that the Government are approaching the discussions I have foreshadowed with the clear intention and determination to enter E.E.C. if, as we hope, our essential British and Commonwealth interests can be safeguarded. We mean business.

It will, of course, be our intention to keep the House as fully informed as is possible in the circumstances of the progress of our discussions. If, as I would expect, there is a general desire in the House for a debate before these important meetings begin, my right hon. Friend the Leader of the House will be glad to arrange discussions through the usual channels to agree on a date which would meet the convenience of the House.

Mr. Fisher

I am sure that we are all most grateful to the Prime Minister for his important statement, which carries us a little further along this road, but would not he go further still and make it quite clear that we make now a declaration of intent, including signing the Treaty of Rome and acceptance of the common agricultural policy and subject only to the transistional arrangements which would be necessary and special arrangements for New Zealand?

The Prime Minister

Now that we have announced that we are to enter into these discussions to see what terms would be available and what can be done to safeguard essential Commonwealth and British interests, I do not think that it would be helpful for me, even in reply to a supplementary question, to start saying now exactly what our position will be in those discussions. The discussions should take place with the Heads of European Governments.

Mr. Edelman

In warmly welcoming the Prime Minister's statement, may I ask him whether he has received any further communication from the French President since the latter's recent Press conference, in which he stated that he had not changed his position about British entry since 1963? In those circumstances, will my right hon. Friend take care to make absolutely sure that Britain does not receive another snub from France?

The Prime Minister

This is a matter of the most supreme importance for Britain, for Europe and for our partners in many other areas. In a matter of this degree of importance, I do not think that we can settle the issue by the mutual exchange of Press conferences. I believe that it requires direct discussion. Therefore, I should not feel that any particular statement made in a Press conference necessarily represented the last word on such a question.

Mr. Heath

The Prime Minister and the House are aware that we shall support him and his colleagues in any genuine approach which he makes for membership of the Common Market. However, the statement which he has just made is in many ways disappointing in view of the emphasis which he himself has placed on the deep review of the situation which the Government have made and the probings which have already been carried out by the present Foreign Secretary, the Chancellor of the Duchy of Lancaster, and the previous Foreign Secretary.

Can the right hon. Gentleman say in which way the last E.F.T.A. meeting at Lisbon and these Ministerial probings have fallen short of what is required for the Government to make a preliminary statement about their intent? Do the Government conditions to which he has referred remain exactly the same as they have in the past—in other words, as laid down in the Bristol speech?

Can the Prime Minister also say whether the new set of probings which are to take place will include matters beyond the Treaty of Rome, including the future defence of Europe and the future of sterling arrangements and the finances of Europe?

Finally, may I say to him that I am sure that the House will want to debate this matter, and we are, therefore, grateful for the offer which he has made; but we will require much more information than he seemed apparently prepared to give us at this stage, because otherwise we cannot form any judgment about the Government's present position.

The Prime Minister

I thank the right hon. Gentleman for his opening words. I note, as I fully expected, that he would find it convenient to have an early debate on this question.

The last meeting of E.F.T.A. was not at Prime Ministerial level and it was not specifically concerned with the question of the conditions which a number of individual E.F.T.A. countries as well as Britain might find it necessary to press in any negotiations of that kind. We therefore felt it right, having concluded the review which we have held, to move first in consultation with our E.F.T.A. colleagues, many of whom, as I say, would like to join the E.E.C., and from there to proceed to individual discussions with the Heads of Governments in Europe.

On the specific questions raised by the right hon. Gentleman, I should not myself feel that these talks should be primarily or to any large extent concerned with questions of European defence. In the past, many of the difficulties arising about the economic negotiations have been clouded by defence considerations. Some of the very large difficulties which the right hon. Gentleman himself faced were due to certain conditions at that time being laid down on defence issues which no longer apply. N.A.T.O. is the right place for talking about those questions—[HON. MEMBERS: "No."]—The North Atlantic Treaty Organisation is the right place for talking about defence. There is nothing in the Treaty of Rome about defence, and I hope that hon. Gentlemen opposite do not want us to make it more difficult by seeking to write a large defence section into the Treaty of Rome.

Naturally, we will consider what should be said to the House. The purposes which all of us jointly have in mind here would not be served by going into too much detail about the terms and conditions that we should want to put into our discussions with Europe. If we have to have negotiations in the House first before discussions start, obviously our position will be greatly weakened. The House knows that there are deep problems about entry into Europe, more of which were raised at Question Time earlier, and I am not sure that it would be wise to go into greater detail than I have already.

Mr. Heffer

Can my right hon. Friend say whether preliminary discussions with the E.F.T.A. Governments are intended to get them to agree to a joint approach, or are we clearing the ground for an individual approach by this country? Secondly, would he not agree that one of our greatest difficulties to entry into E.E.C. is our close association with the United States, which means that the French view us with some suspicion in this respect?

The Prime Minister

I recognise that our association with the United States has been one of the very big problems. The position of Britain as an Atlantic Power has been one of the big drawbacks to French acceptance of British entry.

On the question of the E.F.T.A. meeting, what we shall try to do is discuss with our E.F.T.A. colleagues the ideas that they and we have about relations with the E.E.C., to see how many of us—as many do—would like to join the Treaty of Rome and to consider whether we should proceed on the basis of indivi- dual or some kind of collective discussions. However, the right hon. Member for Bexley (Mr. Heath) will be the first to tell us from his experience that, in the past, the E.E.C. has insisted upon individual applications.

Even so, it is very important that the E.F.T.A. countries should try to move as closely together as possible, because there is a big difference in an organisation which is not one person applying or even in a suppliant position asking to join the Six. It is a big thing this. There is something approaching a merger of six countries, on the one hand, with another six, on the other hand. Therefore, we shall try to see what are our common interests and problems in any approach which, after these high-level probes, seems possible.

Sir Alec Douglas-Home

At an earlier stage, the Prime Minister gave some figures which were useful to the House. Will he convey them to his right hon. Friends in the Cabinet, because they are wildly different from those which were given by his right hon. Friend the Secretary of State for Scotland during the agricultural debate. He said that it might mean 2½per cent. on the cost of living. I take it that that would be spread over some years, but he did not say that.

The Prime Minister

Certainly, it is a total cost for as long as it is required to do it—[HON. MEMBERS: "Oh."] I gave the figures which I was asked for. I said that it would mean 10 to 14 per cent. on food prices. Those are the "neat" figures. They do not take account of increases in distributors' margins—[Interruption.] I am trying to give the figures to hon. Members, who may or may not be capable of understanding them. They do not take account of possible effects on wages and, therefore, on other prices. They are the simple food prices. They are not different from those given by my right hon. Friends.

I have not the words of the Secretary of State for Scotland in mind. I know that my right hon. Friend the Minister of Agriculture has quoted a higher figure, not so much in this context as in that of the changes in our own agricultural policy within this country, which would mean a figure much higher than I quoted.

Mr. John Hynd

Is the Prime Minister aware that his announcement will not only have overwhelming support on both sides of the House—[HON. MEMBERS: "No."] I said "overwhelming", not "unanimous"—but also throughout the Continent of Europe? Will he also note that many of us welcome the fact that on this occasion we have not had to wait until 10 years in the life of a Government have elapsed before a positive step was made, as we did in the case of the last Conservative Administration?

The Prime Minister

I thank my hon. Friend. I am not going to make any contrast between this operation and what happened four or five years ago. There were difficulties then which do not exist now; there are difficulties now which did not exist then. The right hon. Member for Bexley faced great difficulties, and no one said that sooner than I did when negotiations broke down. [HON. MEMBERS: "Oh."] My words are on the record, indicating the sympathy that I expressed to the right hon. Gentleman at that time.

The facts are—and this is why it would be wrong for me to go into too much detail about the problems—that the previous Conservative Government made their effort in their way. We intend to make our approach in our way, and we only hope that, as a result of it, we shall get the answers that most of us want.

Mr. Grimond

May we take it from the Prime Minister's statement that the Government are now agreed that if we are to enter E.E.C. we have to accept the Treaty of Rome as it stands and the basic principles of the agricultural policy, so that price levels may be altered? Secondly, while I appreciate that he may not be in a position to tell the House in detail what are the essential interests to be safeguarded, may I ask whether he will agree that, when a debate takes place, he must give us more information about the essential interests of ourselves and the Commonwealth?

The Prime Minister

On the right hon. Gentleman's second point, I shall have to see if I can give the same information at greater length, to satisfy him. The right hon. Gentleman will have great justification in claiming that his party was in favour of this long before any other. He can, and I know that he will.

But I do not think that he is constituted to negotiate on behalf of Europe, any more than the right hon. Member for Bexley is. Our difficulties in these very tough talks will be greater if I am pressed to give away every point in negotiation in the House before we get there. That is why I do not intend to say anything further about the agricultural policy, the problem and size of which we all know.

On the Treaty of Rome, it is important to give an answer to the right hon. Gentleman, if he will bear with me. We all recognise the importance of the attitude of the Government to the Treaty of Rome itself. The Government take the view that, while there are anxieties on the point, the Treaty of Rome is not in itself or necessarily an impediment. There are anxieties, as I have said, but the Treaty need not be an obstacle if our problems can be dealt with satisfactorily, whether through adaptations of the arrangements made under the Treaty or in any other acceptable manner.

Perhaps I might summarise this important point by saying that the Government would be prepared to accept the Treaty of Rome, subject to the necessary adjustments consequent upon the accession of a new member and provided that we receive satisfaction on the points about which we see difficulty.

Mr. Shinwell

Before embarking on this perilous adventure, about which many of us have strong reservations, may I ask my right hon. Friend, not on a point of detail, but on a point of vital principle, whether, when he is engaged in these high-level talks with high political dignitaries on the Continent, he will make it clear beyond peradventure that this country, whatever economic arrangements may be sought and applied in our relations with E.E.C, will not agree to the creation of a European Parliament and a supranational Government?

The Prime Minister

I know that my right hon. Friend has many anxieties about what he calls this perilous adventure. I have made plain that when these discussions have taken place we shall be in a position to know whether the conditions appear to be there to enable us to start negotiations for entry, or whether they do not.

With regard to the question which my right hon. Friend wants made clear, the Government regard these as discussions about the coverage of the Treaty of Rome, the economic association within Europe at present of the Six, and it may be of the eight, or ten, or twelve, depending on how many other countries join. I ought to mention, with regard to the position of E.F.T.A., that Ireland will have a close interest in this, and that we are in close touch with the Irish Government about it.

I do not think that we have ever contemplated, and I do not think, although we never got a very clear answer on this, that the previous Government ever contemplated, that discussions about E.E.C. meant a European Parliament or a supranational authority dealing with matters of politics, foreign affairs, or defence. This is not what we are talking about, and there is no provision for any of these things in the Treaty of Rome.

Sir J. Eden

Can the Prime Minister say what is the timetable which he foreshadows both for the exploratory talks and for the subsequent negotiations?

The Prime Minister

We are in discussion at present with E.F.T.A. about the conference of Heads of Government of E.F.T.A. countries, which I hope will take place in a few weeks' time, and my right hon. Friend and I hope, either before the end of this year or early next year, to start on this series of discussions in the European capitals to which I have referred.

One further advantage of these talks at this time—I am thinking of December, January, or February—is that they will enable my right hon. Friend and I to stress with the Heads of Government with whom we are dealing the vital importance of being forthcoming on the Kennedy Round, to which we all attach importance. The attitude of many people in this country towards the E.E.C. will depend to a considerable extent on the degree to which the E.E.C. proves itself outward-looking by a forthcoming attitude on the Kennedy Round. As to the negotiations, there has been no decision and there cannot be until the talks have been held.

Mr. Raphael Tuck

Does my right hon. Friend really consider that British interests, that is, the interests of the people as a whole, will be safeguarded if this means an increase in food prices of between 10 and 15 per cent.?

The Prime Minister

I have said that there are important problems, and I indicated that this was one. There are important problems coming under the heading of what we have called essential British and Commonwealth interests, but I do not think that it would be helpful to go into detail on any of the particular issues which we shall be discussing.

Mr. Sandys

While I would have liked the Prime Minister's statement to have gone a little further, may I join others in warmly welcoming the much more positive tone of his important statement which I think, on the whole, will be well received by our friends on the Continent? May I ask him whether he recognises, now that these special high-level talks are starting, the importance of maintaining the speed and the momentum?

The Prime Minister

I thank the right hon. Gentleman for what he has said. I think that the importance of the statement which I have made this afternoon lies not in any declaration. It would have been possible to have made a simple declaration, a form of words. I think that the words used by the right hon. Gentleman at the end of his statement contain the key, namely, momentum. We are providing for action and movement towards seeing whether we can get the right terms to go into the Common Market. If we cannot, that will be a different situation, but we shall hope to find that we can. My right hon. Friends and I fully recognise the need to maintain the momentum. We intend to start at—I was going to say at a hell of a pace, but that would have been out of order—but I agree about the necessity to maintain the momentum.

Mr. Anderson

I welcome my right hon. Friend's long-awaited and positive statement, but why will he not couple this with a declaration of political intent, to offset the fears of those who imagine that we shall be more de Gaullist than de Gaulle when in the Community, and to prevent the emergence of an irresponsible Executive?

The Prime Minister

I was not sure what kind of declaration of intent my hon. Friend wanted. I do not believe that our purpose will be served by playing politics as between one member of the Six and another or others. With regard to political conditions, I think that I have dealt with them in my reference to the Treaty of Rome. I do not believe that these discussions involve anything further, whether in defence or supra-nationality, than I have said.

Mr. Godber

Does the Prime Minister realise that the answer he gave the Leader of the Liberal Party has left the agricultural position very much in the air? Agriculturists in this country will be concerned, and will wish to know as soon as possible precisely where they stand. We realise the difficulty, but will the Prime Minister say where he stands in relation to this, particularly after the things said by himself and others at the General Election?

If I might take the right hon. Gentleman up on the point about increased food prices, he said that the answers given by the Minister of Agriculture related to our policy and not that of E.E.C. I think that the right hon. Gentleman got his figures the wrong way round.

The Prime Minister

I was basing myself on something said during the election by the Minister of Agriculture. I have never sought to disguise our anxiety about agricultural policy and I do not see why I should today. The agricultural problem with the E.E.C. arises from two factors. First, the effect on British agriculture, though many experts consider that British agriculture will be very prosperous under these conditions—sections of it at any rate, other sections would not. We might be prosperous producing the wrong things, too much starch and not enough protein, but there is a lot of argument about that. I think that the problem of excess production of cereals in this country, and beef, has been accepted as one of the implications of the present price level—and I emphasise the present price level—of the Common Market, because this price level may not continue in that form.

The other anxiety about agriculture—and this has been the position all along—is the serious effect not even primarily on the cost of living or on the balance of payments, but on the fact that these high levies would be placed on the importation of every ton of Canadian or Australian wheat into this country, and we should be paying higher world prices in those circumstances.

I think that we fully discussed the special problem of New Zealand when we last debated these things. It was recognised by everyone in the House. That is a very obvious one, but other anxieties have risen since then about these levies, and this is a big problem about agriculture. I am not sure that I would carry things further by expatiating at further length on it.

Mr. Bellenger

While warmly congratulating my right hon. Friend on taking the enlightened attitude which he has now taken, may I ask him whether he recognises that the House will want considerable information, and not only one debate? Will he also recollect that when the previous negotiations were taking place the House was, on the whole, one must admit, kept fully informed as to the general direction of those negotiations? Will my right hon. Friend guarantee to give at least the same volume of information, and, if necessary, not to limit the debate in this House to one occasion?

The Prime Minister

It is the case that during the negotiations in 1961–63, whenever the right hon. Gentleman the Member for Bexley returned from Brussels, the House received full and detailed information on what he had been doing, sometimes so detailed that the right hon. Gentleman will remember some of the gibes about certain of the commodities with which he was dealing, but we expressed our thanks to him at that time. What we are doing now is not entering into negotiations in the sense of applying to enter and then going to Brussels. These are discussions with Heads of Government. It might have been better if the previous Government had operated on this basis—it is arguable—at a critical time in the discussions. We shall give the House as much information as we can, but I do not guarantee that we shall be able to do everything that the right hon. Gentleman did in the pre-negotiations period.

Mr. Mendelson

On a point of order. I should like to point out that of the 16 Members that you called, Mr. Speaker, to ask supplementary questions on this important statement, 15 supported the Government's policy and only one opposed it.

Mr. Speaker

I know that the hon. Member will acquit me of any desire to select speakers on one side rather than another. What the Chair tried to do was to get a cross-section of the House. If he failed to do so it was by accident and not design.

Mr. Shinwell

Since my hon. Friend has referred to the ratio of 15 to 1, and I am the one in the minority, I should like to say that I will take on all 15 myself, at any time.

Mr. Jennings

I hestitate to raise this further point of order, Mr. Speaker, but I am worried and perturbed at the fact that, particularly on this side of the House, no expression of opinion contrary to the general trend was heard, and that the bulk of the speakers from this side were either Front Bench speakers or Privy Councillors. This question worries me.

Mr. Speaker

The hon. Member's anxiety is the exact parallel of that expressed, from a different point of view, by the hon. Member for Penistone (Mr. Mendelson). May I assure the House that I attempt to distribute my favours between Privy Councillors and back benchers as fairly as I can, and if I lean at all it is against Privy Councillors?