HC Deb 05 May 1975 vol 891 cc997-1002
7 . Mr. Marten

asked the Secretary of State for Trade to what extent entry into the Common Market has had a positive or substantial effect on the United Kingdom's balance of trade.

Mr. Shore

While it is not possible to identify with certainty the effect that entry into the Common Market has had on our balance of trade, the deficit with the EEC has substantially worsened.

Mr. Marten

Does the right hon. Gentleman recall that in paragraph 45 the 1971 White Paper produced by the previous administration said that they were absolutely confident that the effect on our balance of trade would be positive and substantial?

Mr. Biffen

For a short period.

Mr. Marten

It did not mention a period.

Mr. Biffen

In the long term.

Mr. Marten

It did not mention that. If the judgment of the pro-Marketeers was so wrong in this as in so many other matters, is there any reason why their judgment should be valued when they say that we shall be isolated if we come out?

Mr. Shore

I find the more extreme claims of the pro-Marketeers very difficult to take seriously, particularly, as the hon. Gentleman rightly recalls, in the light of the very strong claims which were made about the alleged benefits that Britain would have from the EEC in the 1971 White Paper which have been seriously disproved by the actual experience of membership.

Mr. Jay

Does my right hon. Friend see any evidence that the position is improving as we proceed from the short towards the long term?

Mr. Shore

No, Sir. The fact of the matter is that there has been a progressive deterioration in our balance of trade with the EEC. The £2,000 million deficit that we chalked up in 1974 is running at a rate of £2,400 million in the first quarter of 1975.

Mr. Higgins

In view of the blatant innuendo in the right hon. Gentleman's reply, should not this question have been transferred? Does he accept that to quote the figures for the deficit without putting them in the context of Britain's overall deficit is grossly misleading?

Mr. Shore

I shall reply to the only serious point made by the hon. Gentleman. It is instructive to look at the matter in the context of our overall deficit. The House must know and face the fact that, apart from the oil trade—which I willingly concede is the major and appalling problem that we face—on the balance of payments basis we are virtually in balance with the rest of the world. On the best available figures, 99 per cent. of our non-oil deficit is now attributable to trade with the EEC.

15 . Mr. Tebbit

asked the Secretary of State for Trade how many questions concerning the responsibilities of his Department in relation to the EEC have been transferred to other Departments or to other Ministers in his Department.

Mr. Shore

None, Sir.

Mr. Tebbit

Does the right hon. Gentleman think that it might be a good idea to start pretty soon? In fact, it might have been a good idea to start earlier today. In answering my hon. Friend the Member for Mid-Oxon (Mr. Hurd) and expressing the belief that it would be possible to negotiate a satisfactory free trade agreement with the EEC after the breach of the Treaty of Rome, the right hon. Gentleman used the word "we". Who is "we"? Is it Her Majesty's Government, or is it some little group inside the Government, or is it the anti-Market group? Should not the right hon. Gentleman use the word "we" at the Dispatch Box only when referring to Government policy?

Mr. Shore

When I am speaking from the Dispatch Box I am reflecting Government policy as a whole, except when I am clearly reflecting my own policy as the Secretary of State for Trade.

16. Mr. Tim Renton

asked the Secretary of State for Trade what evidence he has that the EEC would be as willing to enter into free trade, arrangements with 2 developed country of 50 million people as with countries of 5 million.

Mr. Shore

Evidence in advance of negotiations is never available. However, the EEC can be expected to consult its own interests in devising alternative trade arrangements if we withdraw.

Mr. Renton

Does the right hon. Gentleman remember that the Lord Chancellor, leading for the Government in another place on 21st April, said: …there is no certainty that we would be able to negotiate a free trade agreement."— [Official Report, House of Lords, 21st April 1975; Vol. 359, c. 603.] When the Secretary of State sees Britain outside the EEC as a free trading self-sufficient island, is he not in danger of suffering the fate of the dormouse at the Mad Hatter's tea party?

Mr. Shore

We are discussing a situation about which, at the moment, we can form only reasoned views. There may be different views about the nature of a free trade agreement, and how satisfactory it might be, if we were to withdraw from the Common Market, but I am not aware of any serious body of opinion which doubts that we can conclude a free trade agreement with the EEC.

Mr. Wellbeloved

Will my right hon. Friend refrain from wasting too much time on giving consideration to what we do after 5th June? In order to make it possible for him to reflect his own views, based on a greater degree of fact, will he consider visiting Brussels and joining in the desperate search for a trade unionist or a Socialist from one of the original six members of the Community who is prepared to recommend to his own country that it should leave the EEC?

24. Mr. Dykes

asked the Secretary of State for Trade what is his latest assessment of the effects on United Kingdom trade that would arise from withdrawal from the European Economic Community.

27. Mr. Brittan

asked the Secretary of State for Trade what is the latest assessment his Department has made of the consequences for trade of British withdrawal from the EEC.

Mr. Shore

The Government's assessment is set out in paragraphs 146–149 of the White Paper on Membership of the European Community (Cmnd. 6003).

Mr. Dykes

Will the Secretary of State give a solemn promise now to give a straight factual answer to the House and say what the figure would be if he added up all our net non-oil deficits with all the countries with which we trade, in comparison with the non-oil non-food deficit with the EEC countries?

Mr. Shore

That is an interesting new possibility. I shall be very pleased to write to the hon. Member. I shall certainly look up those figures for him and let him have a reply.

Mr. Brittan

Does the right hon. Gentleman agree with me that the important factor is the effect of the reimposition of the common external tariff if we were to leave the Community? Does he not agree that unless adequate attention is paid to that factor, no realistic assessment of what will happen can possibly be given?

Mr. Shore

I agree that the common external tariff would be an important factor. That is why any subsequent negotiations to reach agreement on both sides so that trade is not hindered either from the EEC to Britain or Britain to the EEC should work to that end.

Mr. Spearing

Does not my right hon. Friend agree that, whatever the importance of the common external tariff, there are many other factors of considerable importance, since we had a positive trade balance of some significance prior to entry? Will he undertake to give the House—or will he give me, in writing—some of the other factors of significance, for instance, delivery dates and quality, which enabled us to have a favourable trade balance before we entered the EEC?

Mr. Shore

Many factors are involved —and in my view they are substantial—in the unhappy development of our trade deficit with the EEC. I shall certainly consider my hon. Friend's invitation, but I have no doubt that at the end of the day an analysis would lead us back to the need for making substantial changes in the efficiency, productivity and capacity of British industry.

Mrs. Kellett-Bowman

Is the right hon. Gentleman aware that Lancaster, which has almost double the national rate of unemployment, does well over 20 per cent. of its trade with EEC countries and that that proportion is rapidly increasing? Is he aware that there is widespread anxiety among employers and workers alike about what would happen in the unlikely event of our withdrawing from the EEC? Is he aware that it is not just the common external tariff but the myriad other arrangements with EEC countries that now make it extremely difficult for countries outside to trade with the EEC? For instance, although Sweden and Norway have an arrangement, they are entirely excluded from these consultations.

Mr. Shore

I am sorry to hear about the unhappiness of the people of Lancaster. Quite apart from the matter that the hon. Lady has mentioned, tariff barriers, and the like, there is not only the forum of Brussels to discuss these matters but the broader forum of the multilateral trade negotiations that are now taking place and that seem to resolve these matters on a broader international basis.