HC Deb 09 November 1983 vol 48 cc298-9
59. Mr. Knox

asked the Secretary of State for Foreign and Commonwealth Affairs if he will make a statement on progress towards reaching agreement on European Community finances.

Mr. Rifkind

It is now generally recognised by our partners that the Community must agree measures that will end the budget inequity suffered by certain member states, notably the United Kingdom. [Interruption.] We have put forward a specific proposal for a safety net scheme that would limit the budgetary burdens that any member state would be expected to bear. Negotiations on this issue are continuing today in Athens, at a Special Council attended by my right hon. and learned Friend the Foreign Secretary.

Mr. Knox

Does my hon. Friend agree that a decision to join the exchange rate mechanism of the EMS might be very helpful in enabling us to resolve our budget problems, quite apart from the other advantages that it would bring?

Mr. Rifkind

There was a somewhat incredulous response from the Opposition when I initially replied to the question. However, I should point out that there is, indeed, unanimity among all member states of the Community about the fact that reform is needed to deal with Britain's budgetary imbalance—[HON. MEMBERS: "When?"] The commitment of the Council of Ministers, which was arrived at at the time of the Stuttgart declaration, pointed to that fact. The Government have always made it clear that there may be circumstances that would make it possible for Britain to accede to the EMS. However, that is a matter for my right hon. Friend the Chancellor of the Exchequer, and I must ask my hon. Friend to direct his question to him.

Mr. Mikardo

Could not the Community save quite a lot of money on the rent and operation of cold stores by giving away some of the hideous agricultural surpluses to the world's famine areas?

Mr. Rifkind

As the hon. Gentleman will know, there is a significant food aid scheme that is administered by the Community. We believe that the best way of dealing with the agricultural surpluses that have arisen is by a sensible policy of price restraint. That would do far more to deal with the surpluses than many of the other measures suggested by certain quarters.

Mr. Dykes

Does my hon. Friend agree that the fact that the Commission has merely made a very controversial and unacceptable proposal does not mean that it will automatically be accepted by the Council of Ministers or the summit? Given constructive good will and co-operation among all member states, there is a very good chance of a successful Athens summit.

Mr. Rifkind

My hon. Friend is correct. The Commission has often made proposals which, in the event, have been rejected or substantially amended by the Council of Ministers. I have no doubt that this proposal will be another example of that phenomenon.

Mr. Cook

Is not the Minister concerned that the Assembly has not only held up the 1983 refund but has clearly stated that its approval depends on success at Athens, about which the Minister — although he had hopes—was rather less than certain? If the Conservatives are anxious to obtain that refund, why did a dozen of them at Strasbourg vote against the payment?

Mr. Rifkind

At the time of the Stuttgart declaration the Council of Ministers made it clear that the payment of the refund to which the hon. Gentleman referred was not in any way dependent on the outcome of the Athens negotiations. The European Parliament has in the past sought to block refunds due to the United Kingdom, but in the event it has eventually agreed that refunds should be released. It is essential that those refunds are released by the appropriate time. I remain hopeful that the European Parliament will accept its responsibilities in this matter.

Mr. Maclennan

Do the Government recognise that generalised proposals for price restraints in agriculture will fail, just as they have failed before? Are the Government at last moving towards recognition of the fact that quantitive restrictions on price support in certain commodities — notably cereals — are more likely to achieve the Government's objectives?

Mr. Rifkind

We have said that there should be not only a strict financial guideline for the totality of agriculture expenditure but specific proposals for each of the commodity regimes covered by the CAP. Price restraint is the most important component in controlling surpluses or unnecessary costs in each of those areas, but we do not rule out other measures that are relevant to particular commodities.