HC Deb 25 November 1970 vol 807 cc428-42
The Chancellor of the Duchy of Lancaster (Mr. Geoffrey Rippon)

With your permission, Mr. Speaker, and with that of the House I should like to make a statement on developments concerning the negotiations for British membership of the European Communities since I last made a statement to the House on 29th October.

Since then I have had the pleasure of representing the United Kingdom for the first time at a Ministerial meeting of the E.F.T.A. Council. I am glad to say that the Council welcomed the progress being made in negotiations with the European Communites.

I have also visited Paris for discussions with members of the French Government, and have had meetings with the New Zealand Deputy Prime Minister, the Norwegian Minister of Commerce, the Pakistan Minister of Commerce and the Governor of Hong Kong.

Two meetings have taken place at the Deputies' level in Brussels.

Their proceedings included discussions on the British request that tariff quotas might be established on a number of raw materials of importance to British industry, on transitional measures, on certain Commonwealth problems and on the European Investment Bank.

The Community transmitted to our Conference of Seven the Commission's observations on the factual papers earlier submitted by the British delegation on Community finance and on sugar; and the British delegation submitted proposals to deal with the problems of New Zealand's exports of dairy products and exports of sugar by members of the Commonwealth Sugar Agreement.

Since my last statement, our fellow applicants for membership—the Irish Republic, Denmark and Norway—have had further meetings with the Community. The remaining five members of E.F.T.A. and the associate member—Finland—have also opened discussions with the Community: Sweden, Switzerland and Austria on 10th November; Portugal, Iceland and Finland yesterday. Things are thus moving forward on a broad front.

The next stage will have to be a detailed discussion of what we see as the three main questions which require to be dealt with in the negotiations. New Zealand dairy products, sugar from developing Commonwealth countries and the British contribution to Community finance.

Members will, however, have read Press reports concerning both the Commission's comments on the British factual paper on Community financing, which has, as I say, been communicated to us, and a more recent major report by the Commission, not yet communicated to us, dealing generally with the transitional mechanisms of enlargement in which are included the three main questions I have just mentioned.

We welcome the fact that in pursuit of our common desire to make progress in the negotiations the Community is formulating ideas for the settlement of all the major problems.

No position has yet been taken by the Community on the major report by the Commission to which I have just referred. We are confident that in considering problems with which this report deals, the Community Council of Ministers will take into account not only the Commission's thoughts on the subject but also our own.

There is one important point on Community finance which is, perhaps, worth making now. For a variety of reasons Community expenditure on agriculture would hardly increase as a result of the accession of the four present applicants.

Thus the present members of the Community should benefit substantially, in terms of reductions in their own contributions, from whatever contribution we eventually might make to the Community budget.

Agricultural exporters in the Community would also, of course, benefit, over the transitional period and beyond, from increased agricultural exports to the British market.

We must of course bear in mind that the figures put forward by the Commission represent a stage in negotiation. It remains to be seen whether the Commission in its proposals has taken all the relevant factors into account.

We seek a fair and sound basis for the enlargement of the Community. In that spirit we are now considering the extremely important and difficult question of the British contribution to the finances of the Community.

This is crucial to the present negotiation; and I very much hope that the Community will await the proposals which we intend to put forward on this point in the near future before themselves endorsing or adopting any position as their own.

The House may wish me to add a few words on two related subjects, which are not involved in the actual negotiations. Following the report to the Government of the Six by their Foreign Ministers on new means of political consultation between them, we have been invited to take part in a meeting in Brussels on 2nd December with the Six and the other candidates to discuss co-ordination of foreign policy in certain fields.

We have gladly accepted this invitation. Her Majesty's Government will be represented by my right hon. Friend the Foreign and Commonwealth Secretary.

On the important question of economic and monetary union, the Six have not yet determined their own attitude to the proposals in the Werner Report. The policy of the Government remains the same as that of its predecessor. Nothing but good can be gained within an enlarged Community from much closer co-operation in financial matters.

Mr. Harold Lever

While welcoming the right hon. and learned Gentleman's report, which is regarded as overdue, may I ask him whether he is aware of the anxiety of the House that he should keep hon. Members continually informed and consider their views upon these matters throughout the negotiations? Is the right hon. and learned Gentleman also aware that he will find the House in this respect an ultimately more rewarding, if less immediately admiring, audience than the Monday Club for the passing of information upon these matters?

Secondly, will the right hon. and learned Gentleman arrange to provide a greater flow of reliable information about what is taking place in these negotiations? Does he regard it as satisfactory that the public and the House of Commons have to rely upon Press leaks of dubious authenticity but which appear to be well informed, rather than on specific information reliably given by the right hon. and learned Gentleman?

Will the right hon. and learned Gentleman take steps to see that this is corrected and that either these leaks do not occur or that proper and reliable information so far as possible is given? In particular, could he possibly, after consultation with the Community, see that we have the Werner Report and the Davignon Report and some information about the discussions that have been taking place, as well as what has been said on behalf of Britain, in relation to the financial contribution?

Mr. Rippon

I appreciate what the right hon. Gentleman said about the importance of keeping this House informed. That is why I am making this statement today, in response to the proposition which was put forward by the Leader of the Opposition. I can assure the House that I have not been able to give anybody more information than I gave in my statement on 29th October. Subject to the wishes of the House, I shall be making a further statement after the next Ministerial meeting on 8th December.

As to the Werner Report and the Davignon Report, I think steps have already been taken for these to be made available in the Library. Where there are other public documents which are relevant I will see that they are made available in the Library. From time to time we have a little delay because we have to make the necessary translations.

As to the financial contribution, I think this is a matter for detailed negotiation. I cannot go into that matter this afternoon.

Mr. Turton

In the course of his statement today my right hon. and learned Friend referred specifically to a number of representations that he has made to the Commission in the course of the negotiations. These have been partly, and no doubt inaccurately, leaked in the Press. Surely it would be a convenience to the House to have a White Paper setting out in broad detail the representations that he has been making on our behalf?

Mr. Rippon

Naturally I will consider what my right hon. Friend has suggested. When a White Paper is appropriate we will certainly bring it before the House. What I always try to do is to identify the subjects and the main terms of the proposals that we are discussing so that any Members of this House or outside bodies can make representations in good time about their points of view.

Dr. Gilbert

In the light of the address given by the Chancellor of the Exchequer to the annual meeting of the International Monetary Fund, and in the light also of addresses given by his predecessor in office on the question of exchange rates so far as this country is concerned, can the right hon. and learned Gentleman say whether he has made any representations to the Six, or will he in the future, about the total undesirability from the point of view of this country of there being any narrowing of the possible margins of exchange rates for sterling?

Mr. Rippon

Those matters do not arise in the negotiations. They are, of course, matters of general interest which are being discussed by members of the Community in the light of the Werner Report. The hon. Gentleman can, of course, put questions to the Chancellor of the Exchequer about his point of view.

It is important to understand that, as to the Werner Report, nothing that would happen in the preliminary stages could possibly affect us before the negotiations are concluded one way or the other.

Mr. Dodds-Parker

Is my right hon. and learned Friend aware that at the meeting of the Western European Union Assembly last week among parliamentarians there was a feeling that he and the Community had gone about as far as possible in making available at this stage information on some very complicated negotiations?

Mr. Rippon

I think that certainly in one way or another a great deal of information is made available, I will certainly play my part in seeing that the House is better informed than anybody else.

Mr. Barnes

Would the right hon. and learned Gentleman not agree that just as important as keeping this House informed is keeping the people in the country informed? Could he not find more ways of reporting direct to the public? Does he not agree that it is very important that people should feel as involved themselves as possible in these negotiations which are taking place?

Mr. Rippon

Apart from my speech to the Monday Club, I spoke yesterday to the National Federation of Women's Institutes. One tries to avail oneself of as many opportunities as possible in making public speeches. There is a lot of talk going on about this subject at the moment.

Mr. St. John-Stevas

Does not the Monday Club need enlightenment more than most of us?

May I congratulate my right hon. and learned Friend on the progress he has made and on his very full and frank reports to this House? Will he be able to achieve his target of a decision by mid-summer without monthly Ministerial meetings, and, if not, how does he propose to bring this about?

Mr. Rippon

I appreciate that my hon. Friend speaks with authority on matters of enlightenment.

With regard to the progress of the negotiations, I am satisfied that all the parties are making efforts to see that they are concluded as soon as possible. I do not think that one can be dogmatic about the timetable, but I am optimistic that we should be able to break the back of the negotiations by the summer of next year.

Mr. John Mendelson

Will the right hon. and learned Gentleman accept that he is negotiating under a mandate from this House, given in the last Parliament, that this country should make an application? Since then a number of proposals have emerged which are now inevitably discussed among the Six, and the President of France, among others, told his Cabinet that the United Kingdom may be expected to accept everything that the Six have agreed to by the time of the conclusion of the negotiations for entry. In view of this fact, is it not necessary that there should be a further debate in this House with a full account of the new developments, so that the House may give its judgment upon them before we continue to negotiate?

Mr. Rippon

We have put forward exactly the same case as was set in hand by our predecessors. We are negotiating on that basis. We must now await the outcome of the negotiations.

As to matters which change the situation while the negotiations go on, that would create a new situation and we would have to face it. I have urged upon my colleagues in the Community how important it is that they should not take any action which would create difficulties in the course of negotiations. I think they now understand this point. I may say that I made the representation with particular force after the adoption of the fisheries Regulation.

Sir T. Beamish

As successful negotiations would lead to the creation of a home market rather more than five times its present size, would my right hon. and learned Friend say something about how he sees trade relations developing between such an enlarged Community and if five members of E.F.T.A. do not apply for membership?

Mr. Rippon

We have had discussions in the E.F.T.A. Council about our respective positions. Some members of E.F.T.A. are applying for full membership. Some are seeking other sorts of arrangements such as association. We are concerned to see that in enlarging the Community and gaining the benefit of the dynamic effects referred to in the previous Government's White Paper, we should not destroy progress which has already been made in establishing free trade within the E.F.T.A. countries.

Mr. Healey

Ministers have recently rightly expressed their concern at the trade legislation before the American Congress. Could the right hon. and learned Gentleman say whether he had any discussion with his colleagues in the Common Market about this problem, and whether it is intended that there should be a common approach between Britain and the Six?

Mr. Rippon

This matter came up at the morning meeting of the Community on 27th October. They indicated subsequently that they had made strong representations to the United States Government about the dangers of growing protectionism and discrimination.

Mr. Healey

Could the right hon. and learned Gentleman say whether it is intended and agreed that there should be a common approach by the Common Market and the applicant countries on this very important issue which affects Europe as a whole?

Mr. Rippon

There are certain things we can talk together about. But the Community is now in existence and it makes its own decisions as a Community. We shall have our opportunity, after the negotiations, assuming they are successful, when we are members. Meanwhile, as I said, there are arrangements for discussion about political matters.

Mr. Ronald Bell

Would my right hon. and learned Friend make a statement to the House when, rather than if, he realises that the terms likely to be obtained are unacceptable?

Mr. Rippon

If I felt that, of course, I should probably come and tell the House pretty quickly.

Mr. Eadie

Would the right hon. and learned Gentleman not agree that the situation is changing, and does he not feel handicapped in trying to carry on his negotiations while the body of opinion in this country is swelling against the Common Market? Will he give that due consideration?

Mr. Rippon

I do not accept that. On the contrary, people are now understanding that vital British interests are involved, that, as three successive Government have said, it is in the British interest to negotiate to join a large community, and, if the terms are right, it will be to our benefit and that of the whole of Western Europe.

Sir John Gilmour

On the question of sugar, as our submission does not seek preferential entry for Australia, and this will lead to a shortfall in sugar coming under preferential arrangements, is it my right hon. and learned Friend's intention that this should be met by increased production of sugar in this country or by importation from the E.E.C.?

Mr. Rippon

All that will have to be a matter for further consideration as the negotiations develop. As regards Australia, we are satisfied that the transitional period will help enormously.

Mr. Alfred Morris

May I press the Minister on the need for an urgent parlia- mentary debate on this whole question? Would he agree that his own personal enthusiasm for joining the Common Market cannot be shown to reflect opinion in the House? Would it not improve his representativeness in the talks at Brussels if we had an urgent and full-ranging debate on the Common Market? Will he consult his right hon. Friend with a view to trying to arrange this?

Mr. Rippon

I am sure that my right hon. Friend will take note of the point raised

Mr. Farr

On the three main questions that my right hon. and learned Friend mentioned, no doubt the third, relating to the British contribution to the European Economic Community's finances, will be settled on a transitional basis, but will he give the House an undertaking that the first two questions, relating to the New Zealand dairy problem and the Commonwealth Sugar Agreement, will be settled only on the permanent basis of continued access to our markets for these products?

Mr. Rippon

In these fields of world trade there is no such thing as a permanent basis. In regard to New Zealand and sugar from the developing Commonwealth countries, we have asked for some form of continuing arrangements, subject to review, that some procedure should be devised in order that we can assess the position as we go along. I am saying nothing about the basis on which we might eventually settle our contribution to the Community budget.

Mr. Pardoe

I welcome the progress so far and the Minister's obvious determination to succeed with the negotiations, but is he aware that speed is of the essence in these negotiations? Can he transmit his own sense of urgency to his partners in the Community? Second, may I ask him about his attitude to the Werner Report and acquaint him with the fact that few of us in the House are entirely reassured or enlightened to know that the Government's policy is the same as that of its predecessor on any subject at all? Is he aware, for instance, that the Werner Report does not call for closer co-operation in financial matters, and will he state specifically that the Government accept the idea of a European currency?

Mr. Rippon

As to the first point, I am satisfied that colleagues in the Community realise that speed is important. I have certainly impressed this upon them. On the Werner Report, it is important to understand—I think that this follows from some of the questions put already—that nothing is likely to happen during the period of negotiation which would cause any concern to anybody in the House or outside. There is thereafter a second stage which the Community is itself discussing, and on which it would take no decisions until, if we were involved, we were members of the Community. There is a third stage rather far in the future which would involve amendments to the Treaty of Rome itself. There again, we should express a view before any such amendments were made.

Mr. Longden

If it be true that the American Government are becoming ever more protectionist, does not that make it even more necessary for our economic future that we should enter the European Economic Community?

Mr. Rippon

I am sure that it is in the British interest and the interest of the whole of Western Europe that these negotiations should succeed.

Mr. McBride

May I ask the right hon. and learned Gentleman two questions? Is he aware that the Chairman of the European Commission said, on 15th September, that the purpose of the enlarged European Economic Community is political union? Taking this and the comments about foreign policy in the same context, would that mean adherence to a coherent E.E.C. foreign policy, with the abandonment of our traditional foreign policy outlook?

Second, last night, in the Palace, I listened with great concern to the Deputy Prime Minister of New Zealand. Diversification has enabled the New Zealanders to earn only 10 per cent. of their income from sources other than their pastoral exports, and they are faced with a grave short and long-term position. Is France implacably opposed to any special procedures for New Zealand?

Mr. Rippon

We all recognise the importance of New Zealand and the extent of the problem which she would face if there was undue disruption of her dairy industry or, for that matter, her exports of lamb. I have no reason to suppose that there is any country in the Community which does not accept that this is a special problem which must be dealt with in a special way.

As regard political union, the House may have noted that President Pompidou said not so long ago at Strasbourg that the Community rested and was built upon respect for the individuality of the States which comprise it. If, in the long run, we achieve a degree of ultimate political union, it will only be after many years of working together and harmonising our policies in many fields.

Sir Harmar Nicholls

Has the Minister stuck by his position that any transitional period for agriculture must be a minimum of six years? Second, does he not think it significant that the Community is prepared to consult with us on foreign affairs, which proves that there is no need to sign the Treaty of Rome in order to be able to join with Europe in settling, matters which are of mutual concern?

Third, although my right hon. and learned Friend has said that his report had been frank and full, we have had this before. It is really a lot of detail which has no bearing upon the fundamental issue as to whether this nation is ready for it, and all the indications are that the nation is not ready. Will my right hon. Friend see that he carries the nation with him before he goes back to Brussels?

Mr. Rippon

On the transitional periods, we put forward what we thought was a fair statement of our interests. We said three years for industry, six years for agriculture, one for the Coal and Steel Community and one for Euratom. We have had an argument about whether it is right or fair to have absolute parallelism or adequate parallelism, and that has been a matter for discussion. The Community has now put forward its proposals. I have always said that we shall consider its argument in the same spirit that we ask the Community to consider ours—what is right and fair? We shall do the same in relation to Community finance. The Community will put forward its position, we shall counter it, and we shall talk about it.

There is no doctrine in this. The aim must be to secure a fair balance between the interests of the existing members of the Community and those of the new applicants. That is our purpose, and I think that we should succeed if the necessary political good will exists on both sides.

Mr. Moyle

Would not the right hon. and learned Gentleman agree that he would have been able to process the negotiations much more rapidly if the E.E.C. had been prepared to grant him more than four meetings in the first half of next year, and does not the unwillingness of the E.E.C. to do that, plus its attitude on the Werner Report on fisheries policy, indicate that the Community is not likely to go out of its way to try to accommodate us within it? What prospects are there for reasonable terms emerging?

Mr. Rippon

My first feeling was that we were not having enough Ministerial meetings. I do not take that view quite so dogmatically now. A very great deal of progress has been made by the deputies, which is as it should be, because there is good will on the part of the Commission to tackle the facts and the background. It is important that Ministers should come together when there are matters to be discussed in depth which officials cannot discuss and when there are matters to be decided. Although there is no settlement on this yet, it looks as though we shall probably have four meetings in the next half year, but we are leaving as it were, pencilled notes in the diary to keep certain other dates free, if it should become necessary. I think that that is the best way to proceed.

As regards the fisheries regulation, we have made representations and reserved our position. I think that this has illustrated how important it is that the Community should not take action during the course of the negotiations which makes our position more difficult. I think that the Community's representatives have taken that point.

Mr. Temple

Is it not clear that the Council of Ministers of the E.E.C. has made its position perfectly clear in regard to fisheries, and does my right hon. and learned Friend realise that there is extreme anxiety among the inshore fishermen of England and Wales that their livelihood would be very much threatened if the E.E.C. policy were put into effect?

Mr. Rippon

I appreciate that. I put it to the Council of Ministers that I was prepared to accept that it was something of a coincidence that they had concluded this arrangement—which they have been talking about for the past five years or so—just when we were starting negotiations. It was not helpful. We have made comments on the regulation and we have reserved our position about it. I am well aware of the anxieties which this has caused. Of course, the existing Community is entitled to regulate its affairs as it wishes, though, if it were frequently to change the basis on which we are negotiating in this way, that would certainly complicate my task.

Mr. Callaghan

May I revert to the question put by the hon. Member for Peterborough (Sir Harmar Nicholls) and ask the Minister to clarify the point? Was he saying that the period of six years is negotiable if there are adequate concessions in other fields by the E.E.C. countries, or is it a fixed position by this country in the interests of agriculture?

Mr. Rippon

I think it wrong to negotiate on the basis that we put forward a demand and in no circumstances would we even consider what the other party has to say about it. If I were to adopt that attitude about decisions taken by the Community, neither this nor, for that matter, any other international negotiations would progress one yard.

Mr. Callaghan

Does that mean that the six-year period is not a fixed period but it can be lowered in certain circumstances?

Mr. Rippon

We have put forward our position, saying what we think is right, knowing that the Community will make certain counter-proposals from time to time. If we reach any agreement, that must then be reported to the House.

Dame Irene Ward

In view of the depth and width of the negotiations which have taken place, when will my right hon. Friend be able to let us know how the various industries in this country are reacting to the way the negotiations have proceeded? It is most important to people concerned with such matters in this country to know how the reaction is going industry by industry to the discussions which have taken place. At what stage will they be brought in?

Mr. Rippon

I have had regular meetings with representatives of the C.B.I. and the T.U.C., and I propose to continue to have those meetings. They will in their own time and in their own way represent to their members their point of view and pass on to me any representations which they themselves receive from particular industries.

Mr. Harold Lever

So as to clear up any misunderstanding which might arise from the answer to the question put by my right hon. Friend the Member for Cardiff, South-East (Mr. Callaghan), will the Minister make clear that what is flexible, and inevitably so, in the course of negotiations is the ultimate period agreed but that, once that has been agreed as part of the terms of entry, it will be a minimum period and cannot be reduced thereafter?

Mr. Rippon

Where we have reached agreements on certain matters, they would all be subject to the qualification of final agreement at the end of the day. So nothing is really final until we reach the end of the negotiations. But we cannot take a fixed position in the course of negotiations about particular propositions in isolation. If we get a good package arrangement, these things are negotiable. Not only is the transitional period important, but what happens within the transitional period is important, too.

Mr. Marten

As the final aim of the European movement, putting it rather generally, is a United States of Europe, could the Government come clean about their attitude to this proposal? For example, if the French Government were to change and the movement towards European unity expedite itself, what would the Government do? Will they come clean? Otherwise, no agreement is likely to get through this House.

Mr. Rippon

It is important that my hon. Friend should understand this. It will not arise for this or, probably, the next Government to determine. But if views of other Community Governments change once we are members of the Community, then the British Government will express their own view at that time. I think that it is worth understanding that no major decisions of the Community are taken without unanimous agreement, and the record of the Community shows that no decision is taken which is against what any member regards as a major interest of its country.

Mr. Barnett

Could the right hon. Gentleman put the Werner Plan in its right perspective and make clear that, so far as the Six themselves are concerned, the most that is likely to happen in the foreseeable future is an acceptance of technical narrowing of the margins but nothing much more? Second, on the general question of parity, does he feel himself bound in any way by the commitment of his right hon. Friend the Chancellor of the Exchequer that in no circumstances is he prepared to consider our own parity before we enter?

Mr. Rippon

Those questions really ought to go to my right hon. Friend the Chancellor, dealing as they do with policy outside the negotiations. I quite agree with what the hon. Gentleman has had to say about the Werner Report. It proposes very little for the first stage, and even on that, dealing with a subject as important as narrowing margins of parity, the hon. Gentleman can be assured that our views would have to be heard.

Several Hon. Members

rose—

Mr. Speaker

Order. We must move on.