Renegotiation (Hansard, 18 December 1974)

§ 27. Mr. Fairgrieve
asked the Secretary of State for Foreign and Commonwealth Affairs how the renegotiations of the United Kingdom's EEC terms are proceeding.

§ 29. Miss Fookes
asked the Secretary of State for Foreign and Commonwealth Affairs what progress he has made in his renegotiation of Great Britain's terms of membership of the EEC.

§ Mr. Adley
asked the Secretary of State for Foreign and Commonwealth Affairs if he will make a statement on the progress on Great Britain's renegotiation of the terms of the Treaty of Rome.

§ Mr. Norman Lamont
asked the Secretary of State for Foreign and Commonwealth Affairs whether he will make a further statement on the progress of the renegotiations with the EEC.

Mr. James Callaghan
I would refer the hon. Members to the statement made on 16th December by my right hon. Friend the Prime Minister.—[Vol. 883; c. 1121–24.]

§ Mr. Fairgrieve
I thank the right hon. Gentleman for his reply. As the EEC is dragged in as a red herring by hon. Members on both sides of the House on various matters to which it is not relevant, will the right hon. Gentleman confirm that, terms apart, the accession to the EEC and the negotiations completed by the Conservative Government in the early 1970s were a continuation of the genuine application for membership and negotiations begun by his right hon. Friends in the late 1960s?

Mr. Callaghan
The important words in that supplementary question were "terms apart". It is in regard to the terms that we find the complaint. It is the seven major terms which we are now renegotiating. We have always indicated our position on that matter since 1971. 1573 But, given that it is "terms apart", I have no doubt that the rest of the hon. Gentleman's supplementary question follows, for what it is worth.

Mr. Alan Lee Williams
What proposals have been made to the Council of Ministers of the EEC about the United Kingdom's contribution to the budget, and what has been the response?

Mr. Callaghan
The contribution to the budget is one of the terms on which we thought that the previous Government did not fight the case hard enough. We have made certain proposals, and the Heads of Government at their recent meeting, recognising that Britain had a reasonable source of complaint, asked both the Council of Foreign Ministers and the Commission to try to find a formula that would enable the situation to be put right. I hope that that will proceed within the next two or three months.

§ Miss Fookes
Are we to expect the Government's decision about a referendum or a General Election before or after the conclusion of the negotiations?

Mr. Callaghan
I cannot yet say when the negotiations will be completed, but I hope that it will be in the early months of next year. In that case, I hope that there will be a decision from the Cabinet on the question of how the British people are to be consulted through the ballot box at the same time.

§ Mr. Luard
Will my right hon. Friend accept that many people on the Government benches and in the Labour Party generally welcome the great progress made by him and my right hon. Friend the Prime Minister in Paris in securing the meeting of the terms set out in our party manifesto for renegotiation? On the question of the trade deficit with the Common Market, to which some hon. Members seem to attach such importance, is it not the case that we have always had a deficit with the countries concerned and that in large part the deterioration is because we have been able over the past few months to obtain food and other raw materials from the Common Market more cheaply than from other sources?

Mr. Callaghan
I am much obliged to my hon. Friend for what he says about our part in Paris. I do not know whether we have always had a trade gap but I have the figures for 1971, 1972 and 1973, which show a substantial trade gap in 1971. It was four times as high in 1973 as it had been in 1971. Before anybody draws any conclusions from that, however, I would add that in EFTA it was about six times as high and in the Commonwealth three times as high. I have the exact figures here. I repeat that it is difficult to draw conclusions. The trouble is that our general trade deficit has been increasing throughout the world, and it is to that that the House and the country should direct their attention.

§ Mr. Adley
I sympathise with the right hon. Gentleman in his obvious political difficulties in his own party. Will he give an unqualified welcome to the view expressed today by his fellow Socialist, Mr. Whitlam, Prime Minister of Australia, who hopes that the British Government will stop shilly-shallying and make up their mind to stay in the Community?

Mr. Callaghan
What the Australian Prime Minister said was very different. I happened to listen to it on the one o'clock news, which is the only report I have. Mr. Whitlam said that it was for the British people to make up their minds whether we would remain in the Community. He said that it would be of no advantage to Australia if we came out. The hon. Gentleman is not particularly accurate on this matter.
Whatever my political difficulties may be, at least it will not take my party four months to decide who our leader will be.

§ Mr. Spearing
Does my right hon. Friend recall that in reporting on the Paris summit meeting this week my right hon. Friend the Prime Minister said that he did not think there was any need to renegotiate the terms of the Treaty of Accession? If my right hon. Friends are concerned with fundamental renegotiation, does not that indicate that they are at least considering amending Section 2 of the European Communities Act? If they will not do either, how does my right hon. Friend think it is a fundamental renegotiation?

Mr. Callaghan
The two things are different. As I first used the word "renegotiation", perhaps I may be allowed to remind the House of the context in which I used it at the Labour Party Conference, when I said that we would renegotiate the detail and reopen the principles. We have done both. That is exactly the line we are following. The European Communities Act is a separate and different matter. It can be looked at again to see whether it is necessary to alter Section 2 in any way. But we are renegotiating the details and reopening the principles.

§ Mr. Churchill
Will the right hon. Gentleman explain why it is one of the central points of the Government's renegotiation of the terms of entry that Britain's share of the EEC's GNP will decline during the period of the Labour Government to 14 per cent. by 1980? Or does the right hon. Gentleman share the view expressed by the Leader of the House last week that it is impossible to say what the position will be by 1980?

Mr. Callaghan
The projections, if continued, show that situation. What we are hoping, and what I trust in the interests of the country will happen, is that through the operation of the Government's economic policies we shall not fall into that sad position. But in the renegotiation we have to provide against that possibility. It is no use waiting for it to hit us and then going back to the Community and saying "We want to make a change". It is precisely on this ground that we have made the proposal, which would be applicable to any other country which found itself in a similar position.