Council of Ministers (Hansard, 31 October 1979)

HC Deb 31 October 1979 vol 972 cc1216-26 1216

§ 29. Mr. Spearing
asked the Lord Privy Seal when he expects reports to be made concerning meetings of the EEC Council of Ministers held since 27 July; and if he will report on the proceedings of the Council held on 18 September.

§ Sir Ian Gilmour
Reports have been made to the House on all Council meetings held during the parliamentary recess. As regards the Council held on the 18 September, I refer the hon. Member to the reply I gave to my hon. Friend, the Member for Reigate (Mr. Gardiner) on 22 October.
I also attended a meeting of the Foreign Affairs Council on the 29 and 30 October at which our discussions included steel aids, the GATT multilateral trade negotiations, imports of United States synthetic fibres and aid to Cambodia. We also gave preliminary consideration to subjects which might be discussed at the European Council.
I am circulating a more detailed account in the Official Report.

§ Mr. Spearing
I thank the Lord Privy Seal for his reply. Will he confirm that the reports that he mentioned are, in fact, written replies to questions? When does 1217 he expect to revert to the policy of making oral statements to the House after meetings of the Council of Ministers? In respect of the Foreign Ministers' Council held on 18 September, can he tell us anything about future co-ordination of overseas aid policy? Following last night's decision, does he agree that harmonisation of our policy with that of Germany, for example, could provide problems, because it would mean a major change of policy?

§ Sir I. Gilmour
Of course we shall always report to the House about these Council meetings. Whether it is an oral or written statement depends on the importance of the business to be transacted and on the availability of parliamentary time. I take note of the point which the hon. Member made in the second part of his supplementary question.

§ Mr. Jim Spicer
When my right hon. Friend next meets his colleagues will he undertake to discuss with them serious problems facing the people of Zambia and Zaire in view of the breakdown of transportation both to the east and to the west, leaving them totally dependent upon the route to the south? This is an important matter, and I hope that my right hon. Friend will give it some consideration.

§ Sir I. Gilmour
It is an important matter, but I am not sure that it relates to this question.

§ Mr. Ford
Will the right hon. Member give an undertaking, on behalf of the Government, that the Government representative at the Council of Ministers next week will, in the national interest, block any order that seeks to extend the outward processing or free circulation of wool textiles within the EEC?

§ Sir I. Gilmour
I do not think that I could give an undertaking in quite those terms. I shall consider the matter and write to the hon. Member about it.

Following is the information: The United Kingdom was represented at the Foreign Affairs Council on 29 and 30 October by my hon. Friend the Minister of State, Department of Trade and myself. My hon. Friend, the Minister of State, Foreign and Commonwealth Office, attended the fifth EEC/Cyprus Association Council, which was held at the end of the Foreign Affairs Council. 1218 There was a preliminary discussion of items which might be discussed at the European Council. This question will he discussed further at the next Foreign Affairs Council on 20 November. Following debate in the House on 23 October, we lifted our reserve on the draft decision on steel aids. The decision is now subject only to a reserve by one member State. It hopes to resolve its difficulties before the Foreign Affairs Council next month. The Council agreed in principle to provide about £16 million worth of new aid for famine relief in Cambodia, in addition to the £3.2 million worth already being provided by the Community. Ministrs had before them a report by the Commission on the GATT multilateral trade negotiations; they noted that the final package of the negotiations constituted a balanced result, subject to a uniformly correct application by the principal partners. The Council asked officials to pursue the examination of the internal implementing provisions, as well as the legal problems linked with formal conclusion. A number of member States, including the United Kingdom, drew attention to the urgency of the problem being caused to European producers by United States synthetic textile exports which benefit from artificially low feedstock prices. The Commission promised to report on further contacts with the United States Administration and to make recommendations for any further action at the November Council. The Council approved the terms of a memorandum of understanding negotiated with Malta earlier in the year about restraint of Maltese textile exports to the Community. Agreement was reached in principle on a mandate for negotiation with Portugal on the revision of the EEC/Portugal trade agreement requested by the Portuguese. One member State was unable to agree at the Council but will, I hope, lift its reserve shortly. Particular consideration was given to Portugal's request to maintain restrictions on vehicle imports, and to proposed concessions on agricultural and paper products. Ministers discussed the state of relations with Turkey in the light of the visit by the President of the Council, Mr. O'Kennedy, and Commissioner Haferkamp to Ankara in September. Approval was given to a statement of the Community's position on the negotiations for the next stage of the EEC/Cyprus Association Agreement to begin in January 1980. This was later communicated to the Cypriots at an Association Council held after the Foreign Affairs Council. A negotiating mandate for the Commission to open talks with the Association of South East Asian Nations—(ASEAN)—on a co-operation agreement was approved. There was discussion on an outstanding problem concerning the draft regulation about 1219 aid to the non-associated countries, but no agreement was reached. The Council gave its approval to signature of the new EEC/ACP convention which took place in Lomé this morning.

§ 30. Mr. Hicks
asked the Lord Privy Seal when he next intends to attend a meeting of the Council of Ministers; and if he will make a statement.

§ 31. Mr. John Evans
asked the Lord Privy Seal when he expects to meet his European Common Market colleagues.

§ 32. Mr. Stoddart
asked the Lord Privy Seal when he expects to meet the Foreign Ministers of the European Common Market.

§ Sir Ian Gilmour
I attended a meeting of the Council in Luxembourg on Monday and Tuesday of this week.
I expect to be in the Far East when the Foreign Affairs Council next meets on the 20 and 27 November, and I shall therefore not meet my colleagues until 18 December.

§ Mr. Hicks
Will my right hon. Friend give an undertaking to the House and the country generally that in any negotiations that take place on the future level of the United Kingdom's contribution to the EEC budget he will not agree to the renegotiation of the common fisheries policy, to the export of sheepmeat to France or to our oil supplies in the North Sea being taken as bargaining factors?

§ Sir I. Gilmour
I agree that all these matters are extremely important in themselves. The fisheries problem is self-contained, as is the budget problem, and each should be settled on its merits. The same applies to the other matters that my hon. Friend mentioned. There is no common link.

§ Mr. Evans
When the right hon. Gentleman next meets his EEC colleagues will he impress upon them that our membership of the Common Market is increasing in unpopularity among the British people? Will he make it clear to his colleagues that unless the EEC agrees to a substantial reduction in our budget contribution at the Council meeting in Dublin the British people will expect the Prime Minister to take unilateral action to reduce our contribution?

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§ Sir I. Gilmour
I agree with the bit in the middle of the hon. Member's question, but I do not agree with either the beginning or the end of it. I agree with his implications that our budget contribution is far too high, and we aim to see that it is reduced so that we are in broad balance as a result of decisions which the European Council is committed to taking in Dublin.

§ Mr. Stoddart
Bearing in mind the belligerent attitude of the Prime Minister in response to the proposals by the Russians for troop reductions in Germany, can the right hon. Gentleman assure me that no talks are taking place at informal meetings of Foreign Ministers of the EEC on the harmonisation of defence arrangements within the EEC, rather than through NATO?

§ Sir I. Gilmour
As the hon. Member well knows, the EEC is not concerned with defence, so that does not come into it. He is right to imply that these matters come under NATO, and they will continue to do so.

§ Mr. Dykes
Does my right hon. Friend agree that there is growing understanding among other member States of Britain's problem in relation to our excessive budget contribution? However, is he aware that this excessive contribution arose exclusively from the negligence and complacency of the previous Government? Does he agree that this gives us the opportunity, in contrast to the recent surge of expressions of nationalistic opinion in other States, to take the Community forward once this crisis is resolved? One of the best things to do would be to reduce agricultural prices by 5 per cent. in the next price review.

§ Sir I. Gilmour
Certainly we wish to stop agricultural prices increasing. I agree with my hon. Friend that there is a growth in the understanding by our partners of our budgetary problem, but there is room for yet more growth in that understanding.

§ Mr. Shore
Is the Minister aware that it is really no good roaring like a lion one day and bleating like a lamb the next over this matter of the budget and the Dublin summit? This is what we have had not only from Foreign Office Ministers but from the Prime Minister herself. If the budget contribution is 1221 intolerable, burdensome and unfair to this country, will the Lord Privy Seal resolve to stop these excessive payments? Is he aware that any action that the Government wish to take to bring that about will have the full support of the Opposition?

§ Sir I. Gilmour
The right hon. Gentleman seems to be reverting to the sort of behaviour that he displayed when he was in government. To give them their due, the Labour Government did nothing illegal in the matter. The right hon. Gentleman should know that to issue threats, and so on, while negotiating is absurd. The sort of approach that he is advocating yielded no dividends when the Labour Government were in power. We shall proceed in a different way.

§ Mr. Hugh Fraser
Turning from the political issue, when my right hon. Friend next meets his colleagues will he bear in mind the civilising and humane aspect of the EEC and instruct and consult his colleagues so that proper relief is given by Europe to the tragic people of Cambodia?

§ Sir I. Gilmour
My right hon. Friend will be aware that Cambodia was discussed yesterday at the Council of Foreign Ministers. He will also be aware that this country has a far better bilateral record than any of our Community partners. Subject to certain budgetary allocations, agreement was reached yesterday to increase aid to Cambodia.

§ Mr. Jay
Is the Minister aware that this country's trade deficit in manufactured goods with the EEC Six is running at an annual rate of £3,700 million? That is additional to both the budget burden and the CAP contribution. What will the Government do to reduce the intolerable strain on our resources?

§ Sir I. Gilmour
The right hon. Gentleman will be aware that there have been balance of payments difficulties for a number of years. The way to gauge our trade performance with the EEC is to compare the export-import ratio of our bilateral trade with our partners. The right hon. Gentleman may be aware—although most of the House will not—that this was 83 per cent. in 1972, 87 per cent. in 1977, 86 per cent. last year and 83 per cent. in the first nine months of 1979. As the right 1222 hon. Gentleman suggests, an improvement in that performance is urgently needed. It is up to industry to take better advantages of the opportunities that are offered by the Community.

§ 33. Mr. Leighton
asked the Lord Privy Seal when his right hon. and noble Friend will next meet his European Economic Community colleagues.

§ Sir Ian Gilmour
On 20 November at the Foreign Affairs Council in Brussels.

§ Mr. Leighton
Did the right hon. Gentleman notice the article in the London Book Review of 25 October by the distinguished Cambridge economist Wynne Godley, who said that, in addition to the net transfer into the budget and the higher cost of food prices, what he called a careful estimate of our balance of trade in manufactures in 1977 showed that we were £4,500 million worse off than if we had not joined the Community? He went in to say that our real national income could have been 10 per cent. higher had we not joined, and that inflation would have been lower. In view of all that, have the Government any official estimate of the cost to our balance of payments and standard of living of our membership of the EEC?

§ Sir I. Gilmour
I am afraid that I did not see that article, nor am I familiar with the publication. Therefore, I am unable to answer the question. Mr. Wynne Godley is a distinguished economist. However, his views on the EEC do not necessarily attract general agreement.

§ Mr. Body
Will my right hon. Friend draw upon his experiences of meetings of the Council of Ministers and tell the House whether he can quote any decision that has been made at those meetings in the last few months that has been of particular interest to this country?

§ Sir I. Gilmour
Certainly—the decision yesterday on steel aids, our agreement with the ASEAN, and so on. I do not have them all at my fingertips, but no doubt there are many.

§ Mrs. Dunwoody
Will the right hon. Gentleman tell the House whether the price of exporting British lamb to France will be the agreement to the existing sheepmeat regime? If so, how will he 1223 explain that to the housewife when prices rise?

§ Sir I. Gilmour
As the hon. Lady knows, my right hon. Friend the Minister of Agriculture, Fisheries and Food is to make a statement on the meeting of the Agriculture and Fisheries Council, which took place yesterday and the day before. However, there is no connection between the two matters to which she referred.

§ 34. Mr. Skinner
asked the Lord Privy Seal when he expects to meet other EEC leaders; and if he will make a statement.

§ 35. Mr. Straw
asked the Lord Privy Seal when he next expects to meet his EEC counterparts.

§ 36. Mr. Knox
asked the Lord Privy Seal when he next expects to meet his European Economic Community counterparts.

§ 37. Mr. Meacher
asked the Lord Privy Seal when he will next meet his European Economic Community counterparts.

§ 38. Mr. George Gardiner
asked the Lord Privy Seal when he expects next to meet the Foreign Ministers of other member States in the European Community.

§ Sir Ian Gilmour
I refer the hon. Members and my hon. Friend to the reply that I have just given to my hon. Friend the Member for Bodmin (Mr. Hicks).

§ Mr. Skinner
Will the Minister confirm that the French ban on British lamb is helping to increase supplies for the British market and keeping prices lower than they otherwise would be? Would it not be a good idea to congratulate the French Government on protecting the British housewife much better than the Tory Government are doing and looking after the housewife's purse, while wrecking the Common Market at the same time?

§ Sir I. Gilmour
The hon. Gentleman holds different views from most of us on the rule of law. We deplore the fact that the French Government have not recognised and obeyed the ruling of the 1224 European Court. We hope that they will not delay long in so doing.

§ Mr. Straw
As the Prime Minister said yesterday that she and the Government were going for a broad balance between our contributions and the benefits that we receive from the EEC, and as, at the moment, we are out of balance by £1,000 million, will the Lord Privy Seal confirm that the target in these negotiations is a reduction in our contribution by £1,000 million? That would bring us back to a position of broad balance. If we fail to achieve that, will it not be a failure by the Government?

§ Sir I. Gilmour
The hon. Gentleman has been selective in his quotation. The Prime Minister also said that she believed that it would be folly to put any figure on the amount. I confirm that she said that we are seeking a broad balance.

§ Mr. Knox
Does my right hon. Friend agree that the Council of Ministers should concentrate its discussions on new initiatives and developments in Community activities from which Britain might gain certain financial advantages to balance against our contribution to the CAP?

§ Sir I. Gilmour
We shall favour anything that is likely to help us. My hon. Friend will be aware that the budget imbalance is so great that there is no possibility of removing it by introducing new projects of the kind that he has mentioned.

§ Mr. Wigley
Is the Minister aware of the considerable dismay in sheepfarming areas at the decision of the French Government to ignore the Court's decision on the import of sheepmeat into their country? In view of the Minister's remarks that this decision will not be used as a bargaining counter in relation to other decisions, will he say what sanctions the Government intend to impose in view of the unilateral French decision?

§ Sir I. Gilmour
I agree entirely with the first part of the hon. Gentleman's question. This is not simply an Anglo-French quarrel. It is a quarrel between France and the rest of the Community on a question of law. My right hon. Friend the Minister of Agriculture, Fisheries and Food will shortly be making a statement on the matter.

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§ Mr. Eldon Griffiths
Does my right hon Friend find it curious that most of the objections to events in Europe by the Opposition are about the terms that were obtained by the Labour Government after the renegotiation? However, will he be fairer to the right hon. Member for Stepney and Poplar (Mr. Shore)? He was a member of the Cabinet which agreed to those terms, but he honourably opposed them throughout.

§ Sir I. Gilmour
My hon. Friend is so double-edged that I am still trying to catch up with him. No doubt the right hon. Gentleman will take my hon. Friend's compliment in the spirit in which it was meant.

§ Mr. Norman Atkinson
Will the Lord Privy Seal confirm that the United Kingdom will support the initiatives that are being discussed at the Council of Ministers to try to break the deadlock on Cyprus? Will he confirm that the United Kingdom will submit further proposals along the lines of the policy that has already been enunciated?

§ Sir I. Gilmour
I am aware that the hon. Gentleman is about to visit Cyprus. The Council of Ministers has been discussing its agreement with Cyprus on economic matters and Cyprus's association with the Community, rather than the inter-communal problem in Cyprus. That matter is not being discussed by the Council of Ministers, but I agree that it is important. I had a meeting with the Cyprus Foreign Minister yesterday.

§ Mr. Russell Johnston
The Lord Privy Seal will know that the European Parliament is establishing a special committee to consider a common electoral system. What preparations does he wish to ask the Council of Ministers to set in train in this regard?

§ Sir I. Gilmour
I do not think that at this stage we have any proposal in mind. In the first place, these matters should be discussed by the Parliament. That is the right way round.

§ Mr. Marlow
The British taxpayer is currently spending £1,000 million a year on subsidising social problems, largely in agriculture, in richer nations within Europe. This costs the average family of four in this country £1.50 a week. France, which makes up 20 per cent. of 1226 the gross national product of the Community, puts 16 per cent. into the Community budget and takes 24 per cent. out of it. If my right hon. Friend, at Dublin, does not get significant advantages from the Council, will we deliver an ultimatum to Europe to make sure that we get a fair deal?

§ Sir I. Gilmour
I have already said that I do not think threats are the best way of proceeding in this matter. I am thoroughly opposed to ultimatums, or ultimata. We have made clear, the Prime Minister above all, that the French position, as my hon. Friend says, is thoroughly inequitable. The matter was raised at Strasbourg. The Commission has produced papers showing that our figures are right. We look for a solution at the Dublin meeting.