HC Deb 09 March 1971 vol 813 cc225-7
11. Mr. Deakins

asked the Chancellor of the Exchequer when he proposes to make a statement about current discussions between the United Kingdom and the European Economic Community about the future of sterling.

24. Mr. Shore

asked the Chancellor of the Exchequer what discussions he has now had or proposes to have with the European Economic Community about the problems of sterling and the sterling area, if the United Kingdom were to join the Common Market.

47. Mr. Redmond

asked the Chancellor of the Exchequer what recent discussions have taken place between the European Economic Community and the United Kingdom with a view to discussing the future of the sterling balances.

Mr. Barber

Such discussions have not yet taken place.

Mr. Deakins

Can the right hon. Gentleman assure the House that the results of these important discussions will be laid before the House before the House is invited to make up its mind on the question of Britain's entry into the Common Market?

Mr. Barber

The discussions are bound to be confidential if they are to be of any use.

Mr. Shore

The Chancellor will be aware of certain statements made by President Pompidou a week or two ago about, as he saw it, the incompatibility of Britain retaining its obligations to the sterling area with the new obligations it would enter into if we were to join the Common Market. Surely, the Chancellor will not simply say that he will take on new obligations without attempting at all to harmonise our present obligations with the new ones which he proposes to undertake? Will he not, as my hon. Friend suggested, make a statement and clear this question up before he brings these matters to a conclusion?

Mr. Barber

It is because there is some misunderstanding about the rôle of sterling and the way it fits into our joining the European Economic Community that I look forward to the discussions which will in due course take place, for I believe that they will show, and will convince people, that there is no so-called problem of sterling in relation to our joining the Community.

Mr. Turton

In the discussions, will my right hon. Friend bear in mind that at present about 25 per cent. of international trade is conducted in sterling and, therefore, any diminution in the sterling area would diminish world liquidity?

Mr. Barber

Over the long term, the rôle of sterling and its relative importance have been declining, as my right hon. Friend knows. I should have thought it likely that this trend would continue in future, and certainly the Government have no intention of reversing it.

23. Mr. Shore

asked the Chancellor of the Exchequer whether the objectives of economic and monetary union, as agreed at the 8th February meeting of the European Economic Community's Council of Ministers, have now been communicated to him and whether he is prepared to accept them.

Mr. Barber

The Council's conclusions have not been formally communicated to Her Majesty's Government, but we welcome the progress which the Community has made.

Mr. Shore

The right hon. Gentleman has made a very serious statement, almost a grave statement. Is he saying that he welcomes and approves that within the next ten years the budgetary, tax and monetary policies of this nation shall no longer be determined by him and his successors? Has he also accepted, and does he welcome, the fact that there should be fixed exchange rates by the end of this decade? If he has done so, does not he think that he should explain his purposes and policies to the British people?

Mr. Barber

What I said in answer to the right hon. Gentleman's Question was that I welcomed the progress which the Community has so far made. I appreciate that the right hon. Gentleman is hostile to this venture, but the resolutions and the two decisions agreed by the Community last month, to which he referred, confirm my view that there are not likely to be any serious problems for the United Kingdom, if we join, in participating in the first stage.