HC Deb 01 May 1975 vol 891 cc708-11
7. Mr. Blaker

asked the Chancellor of the Exchequer what steps he has taken to inform the British public of the economic and financial consequences of withdrawal from the EEC.

11. Mr. Brittan

asked the Chancellor of the Exchequer what steps he has taken to ensure that the British public is kept fully informed of the economic and financial consequences of withdrawal from the EEC.

Mr. Healey

The wider consequences of withdrawal, including the economic effects, were set out in the White Paper "Membership of the European Community Report on Renegotiations" (Cmnd 6003). The Government have also published a popular version of the White Paper.

Mr. Blaker

Will the Chancellor confirm that in the next few weeks he will be giving maximum publicity to the relevant part of the Government's White Paper, which says that there could be a significant effect on confidence, affecting also our ability to finance our balance of payments deficit and investment in this country, and, furthermore, that there could be an adverse effect on employment and the rate of inflation?

Mr. Healey

Yes, Sir. I have been doing so for many weeks. But the House must understand—whether hon. Members support or oppose Britain's remaining in the Community—that the solution of our economic problems will rest overwhelmingly with what we do in Britain, whether we are in the Community or not. There is no question but that our opportunities to improve our economy have been greatly affected in recent years by major uncertainties about both national and international developments. A decision to leave the Community would add a new dimension of uncertainty to those that already exist—a dimension which might be very protracted in time and which would be certain to damage the readiness of business men to invest and the ability of the Government to borrow abroad. For that reason such a decision would be liable, as the White Paper says, to increase both unemployment and inflation.

Mr. Torney

Does the Chancellor agree that the largest proportion of our non-oil balance of payments deficit is with the Common Market countries and that there has been a tremendous increase in that deficit since we entered the EEC? Does it not therefore follow that if we leave the Market we shall be better off in that respect?

Mr. Healey

No, Sir, unfortunately, it does not.

Mr. Brittan

Will the Chancellor assure the House that he will be at the forefront of the campaign in the country for a "Yes" vote and not just sit on the sidelines? Will he also seek to persuade the Prime Minister to be an active campaigner in this matter rather than a lukewarm supporter of his own policy?

Mr. Healey

I must say that that remark comes rather oddly from a member of the Conservative Party, since we are told in today's newspapers that over half of the constituency Conservative associations have refused to participate in the campaign supported by the Opposition Front Bench.

Mr. William Hamilton

Will my right hon. Friend issue a statement disabusing the public of the misrepresentations of the trade figures, especially the deficit, given repeatedly inside and outside the House by the Secretary of State for Trade? Will my right hon. Friend make it abundantly clear that if we leave the EEC the balance of payments problem is likely to become worse rather than better?

Mr. Healey

To adopt some words of Mr. Lytton Strachey, my hon. Friend must not seek to interpose his body between my right hon. Friend and myself.

There is no question but that our balance of payments with the Common Market has deteriorated over the past three years, though there are great differences of judgment on the question whether the causes of that deterioration were the effects of entry into the Common Market. This is an important point. The chance to make British Leyland a viable concern depends critically on increasing its share of the European market for automobiles by 25 per cent.—or from 3 per cent. to 4 per cent. of the whole. The opportunity of doing so would be enormously reduced were we to leave the Common Market.

Mr. Marten

I do not wish to comment on the most bracing bit of Socialist propaganda, namely the popular version of the White Paper which is supported by so many people, but does the Chancellor agree that many of the forecasts made in the 1971 White Paper have turned out to be untrue? Therefore, why should anyone in this country take any heed of the warnings given about the effect of coming out of the EEC?

Mr. Healey

I recall, having been a member of the Labour Government at the time when their White Paper was published, that that White Paper made it clear that there were enormous uncertainties about the effects of entry. Indeed, it is worth reminding the House that 50 economists signed a letter to The Times saying that the consequences would be advantageous. That letter was accompanied by another, signed by 50 different economists, saying that the consequences would be disadvantageous. In some cases the consequences have been less damaging than expected, and more helpful than expected. That is especially true with regard to the budgetary contribution. In other cases it has gone the other way.

Sir G. Howe

Will the Chancellor now take advantage of the invitation extended to him by my hon. Friend the Member for Cleveland and Whitby (Mr. Brittan) by confirming today his own agreement with the view of the Government that we shall be in a much stronger position to face the future if we stay inside the Market than if we try to go it alone?

Mr. Healey

Yes, I have done that. I reciprocate the right hon. Gentleman's invitation by suggesting that he should have a private word with the new Leader of the Conservative Party and try to persuade her to behave on all occasions as she did on one occasion in the House. I gather from this morning's newspapers that during her visit to the Assembly yesterday she was extremely evasive when asked questions about her attitude towards the future development of the Common Market.