HC Deb 27 March 1979 vol 965 cc259-69
The Minister of State, Foreign and Commonwealth Office (Mr. Frank Judd)

With your permission, Mr. Speaker, I will make a statement about the main business to be taken by Ministers of the European Community during April. The more detailed written forecast was deposited yesterday. At present five meetings of the Council of Ministers are proposed for April.

A joint Foreign Affairs and Finance Council will meet on 2 April and will consider two Commission discussion papers, first "Financing the Community Budget —The Way Ahead" and secondly "A Global Appraisal of the Budgetary Problems of the Community."

The Foreign Affairs Council will meet on 2 and 3 April and will discuss the relaunching of the EEC-Turkey association agreement, relations with Yugoslavia, and preparations for UNCTAD V. Ministers will also review the position reached in the GATT multilateral trade negotiations and will discuss negotiations with China for an agreement over trade in textiles. The Council will prepare for the next, and possibly final, meeting at ministerial level of the Greek accession negotiations, which will take place immediately after the Council, and will again consider revised Commission proposals concerning specific aids given by member States to the steel industry.

The Environment Council will meet on 9 April for a general exchange of views on environment policy, which is expected to include discussion of Commission papers on waste management, clean technologies, guidelines for the assessment of the possible impact on the environment of any proposed building or construction work, and European conventions on the quality of life.

The Agriculture Council will meet on 9 and 10 April to continue discussion of the 1979–80 CAP price proposals.

A Finance, or special Fiscal, Council may meet on 23 April to resume discussion of interest rate subsidies to be paid to the less prosperous members of the EMS exchange rate mechanism, and may also consider the harmonisation of excise duty on alcoholic beverages and the three draft directives concerned with VAT.

Mr. Hurd

I thank the Minister for that full statement. It is the more welcome to us because it sometimes seems that at this time, when a lot of important business is being transacted in the Community, Ministers are usually too busy making electioneering speeches on the subject to tell us what is actually going on.

For example, will the Minister tell us whether the Financial Secretary to the Treasury will make a statement to the House about the outcome last week of discussions on the Community budget for 1979, in view of the great importance of the issues and the many changes of stance gone through by Treasury Ministers during the time that it was discussed?

Finally, will the Chancellor make a statement on the matter mentioned by the Minister, which will be discussed again next week, about interest rate subsidies for less prosperous countries? Is it the Chancellor's view that whether or not we join EMS we are eligible, after five years of his chancellorship, for special interest provisions on the ground that we are a less prosperous member of the Community?

Mr. Judd

With regard to the Finance Council, I assure the hon. Member for Mid-Oxon (Mr. Hurd) that we shall keep the House fully informed of developments after the joint Finance-Foreign Affairs Council meeting next week, which is, of course, crucial in this respect. As to the interest rate subsidies, as I am sure the hon. Gentleman is aware, we do not stand to lose, because there will, of course, be a refund of any subscriptions that we make in this respect.

Mr. Faulds

Will my hon. Friend make the point to his colleagues that while America is stuck on the hook of the Kissinger promise that there will be no recognition of the PLO until it has recognised Israel—which is like asking people of an occupied country to recognise their occupiers—there can be no real progress towards peace in the Middle East, regardless of the Camp David con, and that there will be an upping of oil prices by Arab countries until we come to the simple realisation of accepting the PLO and working for the creation of a Palestinian State?

Mr. Judd

I know that my hon. Friend the Member for Warley, East (Mr. Faulds) has strong views on this matter. The Government have made their position perfectly clear. We recognise that the comprehensive peace towards which we hope to build on the basis of this new agreement will have to take into account the needs and aspirations of the Palestinian people. That is fundamentally important. As to the PLO, the position of the Government remains totally unchanged. Unless the PLO can come to terms with the need to recognise Israel's right to survival, there can be no question of formal recognition or ministerial contact with the PLO.

Mr. Peter Mills

Will the Minister tell the House when we can expect the Council of Ministers to discuss fishing? Will he bear in mind that these problems are mounting up, particularly in South-West England? While we need to maintain our position, we also need to move forward. Can the Minister let us know?

Mr. Judd

I am sure that the whole House wishes to see a satisfactory solution to the problem of fishing policy within the Community. However, it is perfectly clear that we are not prepared to see that solution achieved on any terms. We believe that a solution must recognise the profound contribution made to the Community by the fish stock that comes from British waters. Of course, we shall want a further meeting as soon as there are indications that progress can be made. To have a meeting that is totally unproductive will not help to find a solution.

Mrs. Bain

With reference to the possibility of aid being given to the steel industry, may I ask the Minister of State, against the background of the Government's dragging their heels over the Hunterston project and the devastation of unemployment in Glengarnock, what assurance he can give that the Government will make very firm pleas within the Common Market for no further redundancies in the steel industry, which is vital to the West of Scotland? Will he also ensure that the necessary investment takes place to make the industry competitive?

Mr. Judd

I am sure that the hon. Lady will recall that Ministers have repeatedly made clear that the Government are not prepared to agree to Community proposals that could delay or prevent the advance of working capital to the British Steel Corporation and that would effectively deprive us of the power to decide upon the speed and conduct of our own restructuring programme.

Mr. Corbett

Can the Minister assure the House that before there is any question of a new agreement with Turkey, the Community will require better evidence of a willingness by that country to withdraw its troops from Cyprus and to put better efforts behind the restoration of peace and tranquility on that island?

Mr. Judd

My right hon. Friend is today meeting the Foreign Minister of Cyprus. We all wish to see the outcome to which my hon. Friend has referred, but the withdrawal of Turkish troops will be achieved realistically only within the context of an overall settlement. We are working towards that in every way that we can. We recognise our responsibility, and we want to see progress. In the meantime, as I have said before—I hope that my hon. Friend will agree—the cause of democracy in Turkey is worthy of the support of the rest of the Western world.

Mr. Eldon Griffiths

Having put to the Community, on behalf of the previous Government, proposals for common work on clean air, clean seas and common waste management, may I very much welcome the prospect of the Environment Council meeting on 9 April? However, is the Minister aware that there is nothing specifically in the Treaty that allows the Community to take action in these areas—rather, it is an adjunct of competition policy? Has he any proposals for the Treaty to be amended so that there can be common Community action on environmental policies as such?

Mr. Judd

We have no plans to amend the Treaty in the way suggested by the hon. Gentleman, but if we can get constructive co-operation in the Community on a voluntary basis we shall go for that. However, I want to make something perfectly clear. In this sphere, as in all others, we favour action on a Community basis where this makes sense, but we favour very much a retention of emphasis on national action where this makes more sense.

Mr. Christopher Price

Is my hon. Friend aware that his answer on Cyprus could be interpreted as an indication that the British Government now consider stability in Turkey very much more important than a just settlement in Cyprus? If he has given that impression, will he put it right now?

Mr. Judd

I am sure that my hon. Friend, with his special knowledge of the issue, would not have made that interpretation. Of course, that is certainly not the case. Anyone who made that interpretation deliberately would be being mischievous. As ever, we are highly committed to the importance of finding a settlement in the interests of all the people of Cyprus, not only because of Cyprus itself but because of the importance of stability in that whole part of the Mediterranean to the southern flank of NATO. We also believe that as fellow members of the Alliance we have a responsibility to work for stability and the cause of creative democracy in Turkey as well.

Mr. Geraint Howells

Will the Minister convey to his right hon. Friend the Minister of Agriculture, Fisheries and Food the wish of my colleagues and myself that he should continue his deliberations in Brussels for a complete freeze on the price review this year? Will he also convey to his right hon. Friend the fact that if we are to restore confidence to British agriculture the green pound should be devalued by 10 per cent, and not by 5 per cent.?

Mr. Judd

I shall certainly convey what the hon. Gentleman said to my right hon. Friend. I should point out that this Government are determined to stand firm on the concept of price freezes, both in the cause of rational agricultural production within the Community and also in the interests of housewives, consumers and families throughout the Community, who are being asked to pay far more than they need for their food because of this wasteful and extravagant policy.

Mr. Hugh Fraser

Will the hon. Gentleman impress on the meeting of Foreign Secretaries the real need for Europe to play a leading part in the Middle East by supporting the amazing settlement between Israel and Egypt, and giving that success proper support instead of pursuing a pusillanimous and divided policy which makes Europe the laughing stock of the world?

Mr. Judd

My right hon. Friend the Prime Minister has already dealt with that question. I only reiterate that we have welcomed the agreement, but I believe that everyone who looks at that great achievement will recognise, as the Community has said, that in history it must be seen as a stepping stone towards a comprehensive settlement in that area and not as an end in itself.

Mr. Spearing

As Minister responsible for our relations with the EEC, has my hon. Friend been told about the energy debate yesterday? Is he aware that it was revealed that the recent finding of the EEC Court means that all fissile material including uranium and plutonium, in this country is in the possession of the EEC, which is also responsible for security and movement? In view of that, can he tell the House when the Government are likely to commence conversations with the French Government, and at what ministerial meeting of the EEC this matter will now arise?

Mr. Judd

I certainly agree with my hon. Friend that the recent Court finding has demonstrated that the Euratom treaty has far-reaching implications for our own energy policy, particularly in the nuclear sphere. I am quite certain that the Community will want to look thoroughly at the implications of that Court finding, so that it can work out sensibly a rational way forward.

Mr. Michael Marshall

In regard to the meeting concerned with the steel industry, does the Minister recall that in the debate on 25 January, in which he was responsible for the Government, a problem arose from the retrospective collection of funds for the European Coal and Steel Community budget? Can he say whether, in the discussions that are about to take place, there is now a firm commitment to find a better way of financing the budget in anticipation, as it were, rather than in a retrospective way?

Mr. Judd

This is a problem that we are continuing to keep under active review with our colleagues.

Mr. James Lamond

Is my hon. Friend aware that if the talks with the People's Republic of China are successful, and they are able to export textiles to this country and to the rest of the EEC, it will cause great concern among all sections of the textile industry, because they believe that the Government will have undone all the good that they achieved with the multi-fibre arrangement and with GATT?

Mr. Judd

I, along with all my colleagues in Government, understand my hon. Friend's anxiety, as well as that of others who are close to the communities in Britain that are dependent upon the textile industry. No one should underestimate the significance of the adjustments that have been made in that industry in Britain over recent years—with more than 100,000 jobs lost. I can assure my hon. Friend that this will be very much in our minds as we assess the recommendations of the Commission following its discussions with the Chinese. Of course, any arrangement that is reached with the Chinese will have to fit in with the overall strategy of the Community's textile policy as a whole, which must seriously take account of the social and economic problems faced in this country and others.

Several Hon. Members rose—

Mr. Speaker

Order. If the House will co-operate with me, I shall call those hon. Members who have risen, but I hope that they will ask brief questions. There is a Ten-Minute Bill before we get to the main business, for which there is a long list of right hon. and hon. Members who wish to speak.

Mr. Marten

Did the Minister hear his hon. Friend the Member for Ormskirk (Mr. Kilroy-Silk) put his supplementary question to the Prime Minister, in which he suggested that the EEC might be awaiting the outcome of the vote tomorrow night because it thought that the Conservative Party would be an easy touch in regard to the price review? Is he aware that the Conservative Party is just as much committed to a freeze on EEC prices as is the Minister of Agriculture, Fisheries and Food?

Mr. Judd

I am certain that the hon. Gentleman, with his absolutely consistent approach on these matters, is deeply committed. I wish that I were as confident that the Conservative Opposition were as deeply committed as this side of the House for the years ahead.

Mr. Roy Hughes

With regard to the meeting on 2 and 3 April on aids to the steel industry, does my hon. Friend appreciate that the best form of aid that can be given to the British steel industry at present is the curbing of imports? Does he appreciate that the Ford Motor Company at Dagenham now largely obtains its steel from West Germany, while at the same time many of our own people have been put out of work?

Mr. Judd

My hon. Friend will know that the December Council of Ministers renewed the anti-crisis measures until the end of 1979. Of course, if we do not get agreement on State aids at the next meeting of the Council of Ministers we shall have to review our commitment to those anti-crisis policies.

Mr. Moate

With regard to the multilateral trade negotiations, is the hon. Gentleman aware of the grave concern expressed by the British paper and board industry at reports that the Commission is about to make some sort of concession to the United States and may offer paper interests in Europe as a sacrificial lamb in the general negotiations? Will the Minister say what the Government's view is on this matter? Will he also say what influence and power they have over the negotiating stance of the Commission's team?

Mr. Judd

That and other matters will be considered on the second day of the meeting on Tuesday, when we shall be examining the report by the Commission on the negotiations to see whether we have reached the stage where we can move forward to an agreement. We are not yet at that stage, but when the formal proposals from the Commission are available the House can scrutinise them and give its views.

Mr. Stoddart

In discussing the financing of the Community budget, will my hon. Friend ensure that we re-emphasise that Britain's contribution is grossly distorted and unfair? Will he inform his colleagues that, while the common agricultural policy wastes money by destroying, storing and dumping food on the world market, there is no possibility that this Government will agree to new financing?

Mr. Judd

That has been made abundantly clear by my right hon. Friends the Prime Minister, the Secretary of State for Foreign and Commonwealth Affairs and the Minister of State, Ministry of Agriculture, Fisheries and Food. We shall continue to make plain that the British people are not prepared to become, in the near future, the largest net contributors to the budget when 76 per cent, of it is used to finance a ridiculously extravagant agriculture policy that penalises the consumer. There will be a further opportunity to bring the financing of the Community budget to a head when the present arrangements on the VAT ceiling of 1 per cent, expire in 1981. New arrangements will have to be made by a unanimous decision of the Council and will require the endorsement of this House.

Mr. Dykes

We have been saying the same thing about the CAP for many months, but does the Minister agree that the constant moaning and hostility towards the EEC that has developed for party reasons on the Government Benches below the Gangway prevents the Government using the Community positively to serve the interests of this country? Should not the Minister and his colleagues have been pressing for months for the location in this country of new Community organisations, such as the EEC trade mark office, the European export bank, if it is finally set up, and, if we join the European monetary system, the European monetary fund?

Mr. Judd

The hon. Gentleman may be a convert to the principle of fighting the injustices of the CAP, but he has been conspicuous by his silence in recent months. He follows these affairs pretty closely and will recognise that there is a growing awareness amongst Ministers and others in the Community of the justice of the British case on the iniquities of the common agricultural policy. The sheer logic of our case is registering. The reforms that we are advocating are not simply in the British interest; they are in the interest of consumers throughout the Community. We are putting forward a Community policy. On other matters of immediate advantage that the hon. Gentleman suggests that we should be fighting for, we are arguing, for example, that a larger proportion of the budget should go towards tackling the problems of urban areas and the restructuring of industry. Those are highly constructive views that we are putting forward, and I hope that the hon. Gentleman will support us.

Mr. Ioan Evans

In view of the reports of the South African slush fund being used to influence the attitude of parliamentarians in the EEC towards Rhodesia, Namibia and South Africa, will that matter be discussed at the meeting of the EEC Foreign Ministers?

Mr. Judd

That is not immediately an issue for Foreign Ministers, although it should be resolved within the European Assembly. Everyone who follows public affairs must be deeply distressed about it, and I hope that Members of the European Assembly and Members of this House will discuss it.

Mr. Cryer

Will my hon. Friend clearly convey to the Finance Ministers, when discussing the long-term Community budget, that we are not prepared to allow in any circumstances, let alone with the CAP, further taxation revenue accruing to the Common Market? Will he, if necessary, use the veto to resist any extension by the EEC of the taxation base? The Conservative Party will allow it to be extended if it gets its hands on power.

Mr. Judd

My right hon. Friend the Prime Minister has made it perfectly clear that when the revision of financing and budgetary arrangements occurs, which will necessitate unanimous decisions in the Council of Ministers and the agreement of this House, that agreement will not be reached until everyone is convinced that the changes are sensible and just.

Mr. Molloy

Is my hon. Friend aware of the strong feelings in Brussels that the Conservative Party would acquiesce in all forms of price increases for food and services and would consider increasing taxation to aid the ailing EEC and its almost stupid Commissioners, who inflict terrible burdens on this country? Will he make it clear that this Government's policy over the past three or four years in combating inflation has produced realistic results? If that were emulated by the EEC countries, we should all benefit and rid ourselves of the greatest threat to Western Europe, namely, inflation.

Mr. Judd

My hon. Friend has spoken clearly for the House. Over the past couple of years there have been significant achievements by my right hon. Friend the Minister of State, Ministry of Agriculture, Fisheries and Food on the price policy that he has managed to make the Community face. He has won positive support. It would be wonderful if Conservative Members were fully behind him rather than detracting from what he is doing on behalf of British consumers and those throughout the Community.

Mr. Hurd

Whose proposals on agricultural prices are now being discussed in Brussels?

Mr. Judd

I am glad to say that the Commission has put forward sensible price proposals, which have been supported to the hilt by this Government. Would that we could persuade other Governments to support them as fully.

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