European Communities (Finance) Bill

HC Deb 27 October 1988 vol 139 cc498-549

Mr. Speaker

I have to announce that I have selected the amendment in the name of the Leader of the Opposition.

5.35 pm

The Paymaster General (Mr. Peter Brooke)

I beg to move, That the Bill be now read the Third time.

The background and purpose of the Bill have already been described and discussed at some length, both on Second Reading and earlier this week in Committee. I shall not go over all the same points in detail again today. Instead, I should like to set the scene briefly and then respond to some of the main concerns expressed by the House in our recent debate.

The general point that I should like to make about the Bill at the outset is that the measures for which it seeks parliamentary approval—the own resources decision and payments under the intergovernmental agreement—are part of a larger package. The package was agreed in principle in February and in detail in June, after long and hard negotiations.

The Commission's original proposals were something of a curate's egg. Some parts were welcome and other parts less so. On the one hand, they included practical measures to reform the common agricultural policy and improve spending controls, both measures for which we had ourselves been pressing. On the other hand, they involved an increase approaching 50 per cent. in the potential size of the Community budget, a substantial cut in our abatement negotiated at Fontainebleau in 1984 and a tax on consumption of oils and fats. Other elements in the plans included a restructuring of the own resources system and a large increase in the structural funds.

Mr. Tony Marlow (Northampton, North)

Will my right hon. Friend confirm that, as we were always told in the past, our rebate mechanism was totally safe and therefore, despite what happened earlier this year, it was not at risk and was not an issue? Why therefore, has my right hon. Friend brought it to the debate?

Mr. Brooke

I referred to the matter only because it is part of the history. The Commission put forward a proposal that would have involved a reduction, and that was the background against which we entered into the negotiations. My hon. Friend is correct in saying that it would have required a unanimous vote of the Council of Ministers to change it.

Our response was that any further increase in Community resources must be accompanied by effective and legally binding controls on spending, that agriculture surpluses must be reduced, that the Fontainebleau abatement must not be diluted and that there should be no tax on oils and fats. We made it clear that we would not agree to individual elements without a satisfactory agreement on the entire package.

These objectives were by no means shared by all other member states. Some of them were distinctly lukewarm about reform of the CAP and bringing spending under stricter legal controls. Some argued that the Fontainebleau abatement should be ended or phased out. However, our objectives were achieved. I believe, therefore, that it is in the interest of the United Kingdom to preserve the package that was agreed in February by giving parliamentary approval to the own resources decision and the IGA payments, which form an integral part of the package.

I recognise that concerns have been expressed about aspects of the Bill in our recent debates. I attempted to reply to detailed questions in the course of the debates, but perhaps it would be helpful if I were to draw together some of the main themes and respond to them rather more generally now.

First, I shall refer to the place of the agreement on the future financing of the Community budget in the context of our overall approach to the European Community. On Monday, some of my hon. Friends and some Opposition Members suggested that the Bill is no longer necessary because the future financing agreement is inconsistent with the vision of Europe that was set out in the Bruges speech of my right hon. Friend the Prime Minister. In fact, the opposite is the case.

It may be that some hon. Members have not read what my right hon. Friend said, or have not read it in extenso. I shall quote some of my right hon. Friend's remarks. She said: If we cannot reform those Community policies which are patently wrong or ineffective … then we shall not get the public support for the Community's future development and that is why the achievements of the European Council in Brussels last February are so important. It was not right that half the total Community budget was being spent on the storing and disposal of surplus food. Now, those stocks are being sharply reduced. It was absolutely right to decide that agriculture's share of the budget should be cut in order to free resources for other policies such as helping the less well-off regions and helping training for jobs. It was right, too, to introduce tighter budgetary discipline … to bring the Community's spending under better control. Thus, far from there being any inconsistency between what my right hon. Friend said in Bruges and the changes agreed at Brussels, at Bruges my right hon. Friend went out of her way to commend the main elements of the Brussels package. I urge strongly those who support the views set out in my right hon. Friend's speech to follow through the logic of their position and to vote in favour of the Bill this evening.

Mr. George Robertson (Hamilton)

I listened carefully to the Minister and followed the quotation from the Prime Minister's speech, which was presumably as delivered. It is slightly different from the text that was issued by the British embassy in Belgium on one specific and important point that is relevant to the debate. I refer to the sentence which begins: It was right, too, to introduce tighter budgetary discipline". In the original text, the passage continued: to enforce these decisions and to bring total EC spending under better control. That is not what the Minister read out. Why was a change made?

Mr. Brooke

That is a textual matter, and I shall make some inquiries during the debate. As neither the hon. Gentleman nor I were present at Bruges on the day in question, neither of us can be certain at this moment which were the words actually uttered.

Mr. Teddy Taylor (Southend, East)

Before we make up our minds on the important issue that my right hon. Friend has put before us, will he amplify what he said in Committee about a possible breach of the strict financial guidelines? My right hon. Friend will be aware that the last strict budgetary controls broke down because the EEC asked for advance moneys and created the 10-month year of 1987. On Monday my right hon. Friend appeared to say that the same thing could happen all over again because the EEC could again ask for advance moneys and thereby overspend like mad. Will he explain whether there has been a change and whether there will be a stop, by means of these proposals, to the Common Market asking for advance moneys and thereby overspending by breaching its strict budgetary control?

Mr. Brooke

As my hon. Friend said, he raised the matter during the debate on Monday. I shall deal with his question at various levels. First, I said that there was nothing in the new arrangements which precluded the Commission from coming forward with a proposal, such as it made during 1987, for reimbursements. How the Council reacts to it is a matter for the Council when the occasion arises. I said that there were strong reasons on the previous occasion why, in the Government's view, it was in the interest of controlling expenditure to carry out the change that was made.

Mr. Marlow

We, as keen students and supporters of the Government, have been told over the years that regional policy is something that should be run down slightly, if not dismantled. This has happened in the United Kingdom and it has had the right results. We have appreciated and supported it. Are we now to believe that the Government feel that regional policy is a panacea for the Community? If that is the case, how much further do we intend to extend it?

Mr. Brooke

Although I yield to no one in my admiration for the loyalty with which my hon. Friend supports the Government, to describe him as a keen and enthusiastic supporter of the Government's proposals in this area would be slight exaggeration.

During the negotiations on structural funds, a powerful case was made about the work that needed to be done in southern Europe and the expenditure that would have to take place. The Government accepted the proposals as part of the overall negotiations.

Some related matters were discussed on Second Reading and in Committee. First, will the new budget discipline arrangements, especially for spending on agriculture, work?

Mr. Teddy Taylor

No.

Mr. Brooke

If so, how will they differ from the arrangements which were agreed in 1984? I agree with my hon. Friend the Member for Southend, East (Mr. Taylor), who uttered an observation in response to my rhetorical question, that the question is a fair one, and I believe that we have a good answer.

The February European package includes five major improvements. First, the guideline limit for spending on agriculture is legally binding. On Monday, my right hon. Friend the Member for Worthing (Mr. Higgins) asked where that legal enforceability is reflected. The answer is that it is in a Council decision on budgetary discipline, which has been deposited in Parliament. The decision is not included in the Bill, because, unlike the own resources decision, under the terms of the treaty it does not require the approval of national Parliaments to come into force. Nevertheless, the budget discipline decision is legally binding in Community law. The guideline will grow at no more than 74 per cent. of the rate of growth of Community gross national product, which is likely to mean a real growth of about 2 per cent. a year compared with real growth of 10 per cent. a year between 1984 and 1987.

Secondly, the general provision to exceed the guideline in "exceptional circumstances" has been abolished. In its place there is a monetary reserve of up to 1 billion ecu to cover unforeseen expenditure resulting from substantial movements in the dollar. That money will be called up only if needed. The reserve will work both ways, so that provision for agriculture will be reduced if the dollar appreciates. The reserve is not expected to be activated in 1988, and on current estimates we would expect reduced spending in 1989.

Thirdly, a new early warning system monitors spending on a monthly basis for each main commodity regime. When there is a risk of overspending, the Commission, and, when appropriate, the Council, will take the necessary action.

Fourthly, automatic stabilisers have been introduced for all the main CAP products. These mostly take the form of automatic price cuts if production exceeds maximum quantities set by the Council.

Finally, new stocks from now on are being depreciated systematically in the year in which they are purchased, and special funds have been set aside to pay for the disposal of existing stocks. These provisions should produce a normal stock situation by 1992.

Nor are the new arrangements limited to agriculture. We also have a series of legally binding sub-ceilings which will constrain all expenditure, and an inter-institutional agreement under which all three institutions bind themselves to respect ceilings on each major area of Community spending.

I suggest that these arrangements are a significant improvement on the arrangements for budgetary discipline that were agreed after Fontainebleau. It was only because the new arrangements were secured that we were prepared to agree to the new own resources decision for which the Bill seeks approval.

Mr. Teddy Taylor

The stabiliser mechanism is an important new factor. Can my right hon. Friend give an assurance that there is no legal or other mechanism that will result in the stabiliser being undermined? A change in price or a widespread change in the green pound would effectively undermine the effect of the stabiliser. Can he give us any assurance that the impact of the stabiliser will not be undermined by other decisions of the Council? Are there any legal requirements?

Mr. Brooke

I have no grounds for supposing that there are. If I need to gloss my statement in answer to my hon. Friend, I shall do so at the end of the debate, if I am given leave to speak a second time.

Mr. Nigel Spearing (Newham, South)

I am grateful to the Minister for his explanation of discipline. Will he now address the question that I put to him on Monday? No one would disagree that the arithmetic mechanism that he has outlined will have legal substance and can be applied. Does he agree that neither the Commission nor even the magnificent and mighty European Court can control the weather or the rate of the dollar? If those two combine in such a way that they make those arithmetical matters nonsense, the rain, the wind, the climate and the dollar rate will overcome the discipline. In such circumstances, how can there be financial discipline?

Mr. Brooke

I say to the hon. Member for Newham, South (Mr. Spearing), as I stated earlier, that what has been eliminated from the Community arrangements is the appeal to exceptional circumstances. When that phrase was composed at Fontainebleau, no doubt it was thought to represent exceptionality, but it was one to which frequent recourse was made—notably in terms of the exchange rate.

Mr. Spearing

Does the Minister accept that one cannot stop changes in the dollar or in the climate?

Mr. Brooke

I shall expand on my remarks to the hon. Member for Newham, South concerning the arrangements in relation to the reserve. The hon. Gentleman knows perfectly well how it operates. It is triggered after there has been a 5 per cent. movement in the dollar-ecu exchange rate and 400 million ecu of appropriate expenditure. There is then a reserve of 1 billion ecu. If that reserve is exhausted, it is the responsibility of the Commission to return to the Council with proposals as to how that overspending is to be curbed, and it is the Council's responsibility to act on those recommendations within two months.

Mr. Stuart Holland (Vauxhall)

I am sure that the Treasury is well aware that many independent commentators anticipate that, whoever becomes the next President of the United States, interest rates there are likely to rise, which will strengthen the dollar. What calculations has the Treasury made, apart from anything that it may have urged upon the Commission, to take into account the strengthening of the dollar against the kind of sums that we have before us for consideration?

Mr. Brooke

As the hon. Member for Vauxhall (Mr. Holland) knows, the arrangements in relation to the monetary reserve are symmetrical. If the dollar strengthens, money is taken out of the agriculture budget and transferred to the reserve. Again, that is done with exactly the same kind of trigger mechanism, with a 5 per cent. adjustment and 400 million ecu. There is then the transfer of up to 1 billion ecu into the reserve, which remains there during the course of that year.

In that respect, one of the differences that obtains, which in this sense is asymmetrical, is that if the monetary reserve is required because of a depreciation of the dollar, the resources are called up from the member states. If the dollar appreciates, the money is taken out of the agriculture budget and moved into the reserve, and at the end of the year it is not returned to the member states but is transferred into the following year as revenue under the own resources decision.

I turn to the intergovernmental agreement. The February agreement covered the Community's revenue expenditure policies and budgetary controls for the years 1988 to 1992. The 1988 budget needed to be settled consistent with that agreement, but it was known that the various national procedures for approving the new own resources decision could take some time to complete. Therefore, the IGA was needed to balance this year's budget, pending entry into force of the new own resources decision. Nevertheless, we made it clear that we could not make any payments under the IGA until parliamentary approval had been obtained.

In our recent debates, the need for the IGA has been questioned on two counts in particular. First, it was suggested that the IGA is financing past overspends. Presumably that is what the Opposition have in mind in the reference in their motion for today's debate to an ex gratia payment to cover past Community financial excesses". I make it clear that the 1988 IGA is needed to finance the 1988 budget—not any other. It is true that there were budgetary problems in 1987, to which I alluded when responding to my hon. Friend the Member for Southend, East. The measures taken to resolve them included switching from advances to reimbursement of agricultural guarantee payments and the deferment to 1988 of certain refunds to member states. However, those refunds totalled less than 700 million ecu for the Community as a whole, compared with an IGA for 1988 of 6 billion ecu, excluding the monetary reserve.

The main element of the 1987 solution—the switch in agricultural guarantee payments—was something that we wanted in any case, because it allows better budgetary control by basing payments on actual rather than estimated needs. I referred to that point in my response to my hon. Friend the Member for Southend, East. That switch did not have any significant effect on the 1988 budget. It did not mean that in 1988 there would be more than 12 months' agricultural guarantee payments. There was simply a one-off saving to the Community budget in 1987.

Secondly, my hon. Friend the Member for Northampton, North (Mr. Marlow) and other hon. Members picked up the good news that there will be a budget surplus in 1988. To go on to say that the IGA is no longer needed is to be a little hasty in one's arithmetic.

Mr. George Foulkes (Carrick, Cumnock and Doon Valley)

Can the Minister tell the House why?

Mr. Brooke

I shall expand on that remark. The 1988 surplus anticipated by the Commission is in the region of 2 billion ecu. It arises from higher than expected customs duties and levies and lower spending, particularly on agriculture. The IGA—even excluding the monetary reserve, which is unlikely to be used this year—is three times that amount. So it is not correct to say that the two can simply cancel each other out. I may add that the 1988 surplus will not be used to fuel overspending. A budget surplus must be treated as revenue in the following year's budget, and the Commission has introduced an amending budget for next year to cut member states' contributions accordingly. In those circumstances, I hope that right hon. and hon. Members anticipate no problems in agreeing that payments should be made under this year's IGA.

Mr. Marlow

Ever eager to come to the common ground, would not the sensible thing be to amend the Bill, such that the IGA is only as much as is required, rather than to leave it open as it is at the moment?

Mr. Brooke

My hon. Friend the Member for Northampton, North will recall an exchange between myself and my right hon. Friend the Member for Worthing in Monday's debate, in which reference was made to a very precise figure. However, there were also qualifying words in that regard. The Commission will only apply for the resources that it actually requires for the monetary reserve.

Mr. Hugh Dykes (Harrow, East)

Does my right hon. Friend agree that this is both a fascinating and an ironical development? The diminishing number of anti-Marketeers on both sides of the House last year were gloating with tremendous joy at the idea of the Community being financially bankrupt. Of course it was not, and those right hon. and hon. Members were using a technically erroneous description of the phrase. Now that, as a result of the Commission's successful management, we have a surplus that will allow a more modest budget requirement next year, is my right hon. Friend planning to send the Commission a message of congratulation from the whole House on its excellent financial husbandry?

Mr. Brooke

My hon. Friend the Member for Harrow, East (Mr. Dykes) is correct in saying that a number of right hon. and hon. Members rushed in to comment on the very favourable way in which the resources are going. However, it is my perennial experience in these affairs that no news is ever as good or as bad as it first appears.

Before concluding, I shall comment on another allegation in the Opposition motion—namely, that the Bill contains automatic provisions for future financing which bypass parliamentary approval". I am a little puzzled by that, but no doubt all will be revealed later when the hon. Member for Hamilton (Mr. Robertson) moves his amendment. I place on record the fact that the Bill does not bypass parliamentary approval. On the contrary, the treaty requires that the basic decision on own resources should not only be agreed unanimously by member states but be adopted by them in accordance with their respective constitutional requirements. Hence the inclusion of the own resources decision in the Bill. The provisions of that decision cannot be changed or disregarded without a further process of unanimous agreement and parliamentary approval.

It is true that implementing regulations, such as that numbered 2891/77, on which we touched briefly in Monday's debate, can be agreed by the Council without needing further domestic legislation, and so can the annual Community budget. However, such regulations and budgets must be consistent with the terms of the own resources decision that has been approved by Parliament. The position under the new own resources decision will be no different in that respect from the position under the decision agreed in 1985.

Mr. Spearing

I thought it best to intervene at this point to explain what I think is the wording in the amendment, which I support, but to which the Minister takes exception.

Mr. Deputy Speaker (Mr. Harold Walker)

Order. It might be a good idea if we wait until the amendment is moved, and then we can have explanations.

Mr. Spearing

In that case, Mr. Deputy Speaker, I shall make my point as though the amendment were not there. Does the Minister agree that, once this goes through, both a normal annual approval of taxation and a formal approval of expenditure by Parliament are unnecessary? We give this until 1992 if we vote in favour of Third Reading tonight, and surely that is the point. The Minister makes his plea, having turned down, last Monday, an amendment that asked at least for a report. That does not sound to me even like accountability, let alone a decision-making power.

Mr. Brooke

Although I understand the hon. Gentleman's point, it is not particularly new in the context of our 16-year membership of the Community. The famous regulation 2891/77, to which we devoted a fair amount of time on Monday, appeared in our affairs during the lifetime of the last Labour Government, and the Scrutiny Committee of that era appears not even to have recommended it for debate in the Chamber.

Mr. Bob Cryer (Bradford, South)

It was chaired by a Tory.

Mr. Brooke

The Committee will have had a bipartisan membership, and I have every confidence that there was at least one Labour Member on it taking a vigilant interest in these affairs.

Moreover, the arrangements for parliamentary scrutiny ensure that the Committee that the hon. Member for Newham, South so ably chairs has opportunities to consider proposals for European legislation and can recommend them for debate if it sees fit. I assure the House that in giving approval to the Bill, it will not be giving up any of the control that it currently has over the European budgetary arrangements.

I have tried to focus on some of the main concerns aired during the passage of the Bill rather than go once more into each point in the Bill and the own resources decision and the IGA for which the Bill seeks approval. If hon. Members wish to raise other matters, provided that I catch your eye, Mr. Deputy Speaker, and with the leave of the House, I shall be happy to try to answer such points later.

I commend to the House a Bill that seeks approval on three points. The first is an own resources decision that preserves intact our Fontainebleau arrangement that has been worth more than £4.5 billion over the past years and that brings the structure of own resources more into line with member states' ability to pay as measured by shares in Community GNP. The second is an IGA that ends the uncertainty over the 1988 budget and enables the reforms agreed in February to be put into effect this year. The third, by implication, is a package of measures including legally binding budget discipline and the reform of the CAP, which should ensure that the Community budget is based on a sound financial footing until 1992 at least. It is always easy to say that one or two elements in a package as wide ranging as this could have been improved, but the impotant thing is whether the package as a whole is welcome. I trust that hon. Members will recognise that it is and will accordingly give the Bill a Third Reading.

6.3 pm

Mr. George Robertson (Hamilton)

I beg to move, to leave out from "That" to the end of the Question and to add instead thereof:

this House declines to give a Third Reading to a Bill which provides for a wholly unjustified ex gratia payment to cover past Community financial excesses, which makes automatic provisions for future financing which bypass parliamentary approval, and whose provisions for the Regional Development and Social Funds risk leading to wider disparities in income and wealth in Britain as well as throughout the Community. It is a pity that the Minister who launched this ship is not here as it sails through rocky waters. The Foreign Secretary graced us with his appearance on 11 July, paying only a brief visit to the House of Commons en route to the Terry Wogan show. One might have thought that, out of a sense of decency or fraternity, he would grace us again with his presence tonight. I had thought that his plenipotentiary and deputy, who listened to the earlier part of the debate, might have stayed, as I have a special word of warm welcome for her later in my speech. As it is, we shall have to remain comforted by the presence of the hon. Member for Enfield, North (Mr. Eggar), the Under-Secretary of State who is here representing the greatness of the Foreign and Commonwealth Office.

On 11 July the Foreign Secretary came to the House, then departed, and later told the viewers of the Terry Wogan show that Members of Parliament would be wondering where he had got to. Most of us wonder that when he is actually at the Dispatch Box, never mind when he is on television. The rocketing that the right hon. and learned Gentleman got from my right hon. Friend the Member for Bethnal Green and Stepney (Mr. Shore), when the House learned where he was, was as nothing to the revenge from No. 10 when it eventually came in Bruges. There, the empress struck back, and now we are told in newspapers that the Foreign Secretary has been sent to all parts of Europe to try to sort out the mess that the Prime Minister caused first by her speech in Bruges and then by the comments that followed it.

The Guardian headline said: Howe launches diplomatic drive to heal rift on EEC union". The article continued: The British government is to make an all-out diplomatic effort to heal the breach that has opened up with its European Community partners before the EEC heads of government summit in Rhodes in December. The Times, not given to sensational headlines, said: Howe moves to head off EC split. Sir Geoffrey Howe is spearheading a diplomatic effort inside the European Community to head off the potentially disastrous row between Margaret Thatcher and her counterparts at the EC". That should be the ultimate lesson for the Foreign Secretary that he should stay for debates and avoid the enticing limelight offered by Mr. Terry Wogan.

Sir Richard Body (Holland with Boston)

In view of what the hon. Gentleman has said about Bruges, will he tell us the Labour party's view on this subject? To what extent do he and his colleagues on the Front Bench agree, or disagree, with that speech?

Mr. Robertson

I should have thought that the hon. Gentleman, being fairly long in the tooth here, would expect me to go back to the Bruges speech. No Opposition politician could avoid such fertile ground. He can be sure that the points on which he seeks clarification will be coming up. Just watch this space. Should he catch your eye, Mr. Deputy Speaker, I am sure that my hon. Friend the Member for Vauxhall (Mr. Holland) will also comment on that significant speech.

Mr. Deputy Speaker

Order. I hope that both sides of the House will not lose sight of the normal conventions that govern the scope of Third Reading debates.

Mr. Robertson

I shall bear that caveat in mind, Mr. Deputy Speaker. This Third Reading marks a watershed in what has been a truly remarkable year for the Government's EEC policy. In February of this year the Prime Minister went, as the Paymaster General told us, to Brussels for the summit meeting. In advance of it she was saying that doubling the original social fund of the European Community would be lacking in any rational justification. She said before the summit that cereal production targets of higher than 150 million tonnes would be an attack on the taxpayer and the housewife. She said that if farm spending were to rise at more than 60 per cent. it would be "extravagant and indefensible". However, she came back from Brussels in February with structural funds agreed at a level rising to 100 per cent. of the previous level, with cereal limits, not at 150 million tonnes, but at 160 million tonnes, and with the growth in farm spending fixed at more than 74 per cent. Although that calculation has been given temporary relief by the one-off circumstance of this year, to quote Mr. Christoffersen, we know that it will rise more rapidly.

Mr. Brooke

So that the hon. Gentleman does not have to go through the exercise of having to speak to the Official Report afterwards to revise what he said, I should draw his attention to what he did say. He said that the proposal was to increase agricultural spending by 74 per cent. I think that he wants to qualify that phrase.

Mr. Robertson

The 74 per cent. is 74 per cent. of GNP. I have used that in this complicated debate to show that the Prime Minister was outdone on that as well. She was conned, and she had to accept something much higher than she originally intended as a limit.

The Bill is the account rendered for that summit—£738 million in an intergovernmental agreement. I hope the House will appreciate that I try not to use those dreadful acronyms that confuse the outside world and behind which Ministers hide. The most dazzling one of those is the invention of "mecu", which disguises the fact that expenditure goes up. I remind the Paymaster General that we are talking about millions of ecu. I commend and congratulate his Department on its new practice of putting the sterling equivalent of mecu into parliametary answers. That is something that should come through in parliamentary debates too, because I do not believe that the British public are aware of the significance of European Community expenditure when that foreign form of currency measurement is used. This intergovernmental agreement means that £738 million is being used to pay off yesterday's debts, and that £300 million a year on top of our already annual contribution of £1.38 million is to be used to pay off what the right hon. Lady conceded in the middle of that humiliating Saturday night in February.

In July, the Foreign Secretary, in paying his flying visit to the House before his television appearance, came to sell us the Brussels package and to tell us that the bad news was really good news, that the cash increase was a saving, that financial promises were legal commitments and that it was all an integral part of the grand design for the new Cockfield-type big business market.

Mr. Brooke

The habit of intervening in these debates becomes infectious, but that is the spirit in which the debate is conducted. As the hon. Gentleman, when referring to yesterday's debts, is referring back to the wording of his amendment, perhaps he will itemise the figure of £738 million and tell us how yesterday's debts are constituted.

Mr. Robertson

Yesterday's debts are constituted inasmuch as yesterday's budget happens to be the 1988 Budget. Today's budget is the 1989 budget in the bizarre world of EEC finance. Yesterday's hole that we are having to fill with an extra £738 million of taxpayers' money is therefore yesterday's debt to fill the hole in the 1988 budget. We have just had an afternoon of high drama in the House, where a Minister's reputation has perhaps disappeared for ever—if it existed at all—over £200 million. We were talking about the amount of money required to uprate child benefit to the inflation rate, which was £200 million. Yet this intergovernmental agreement—[Interruption.]

Dame Elaine Kellett-Bowman (Lancaster)

That is completely irrelevant.

Mr. Robertson

The hon. Lady has just appeared in the Chamber.

Dame Elaine Kellett-Bowman

I have been here.

Mr. Robertson

I apologise to the hon. Lady on that one account. She probably has been here, but clearly was not listening to my argument.

Dame Elaine Kellett-Bowman

I was listening. I was taking notes.

Mr. Robertson

If the hon. Lady had been listening, she would not have made the mistake that she has made. I am contrasting the quite proper indignation on both sides of the House today about a sum of £200 million for child benefit with the absence of any feeling at all about a payment of £738 million to the European Community for previous debts. That is the true scandal.

In September the Prime Minister blew the Foreign Secretary—and, indeed, herself—well out of the water. The right hon. Lady, who had signed the Single European Act, suddenly had a blinding flash of inspiration about what she had actually done. She had railroaded through the House the Single European Act by means of guillotine, which was, of course, introduced by the right hon. Member for Shropshire, North (Mr. Biffen), who is well-known as a passionate European. I note from Monday's Hansard that the right hon. Member for Shropshire, North voted with his right hon. Friend, which I think he should count as a bit of a record.

In September the Prime Minister woke up, and did not like what she had woken up to. Now, in October, the Foreign Secretary is being sent out again, like some tired old jazz singer, to repair the damage that was done at Bruges. However, even as he sets out on that ambulance trip—one must assume that that is where he is this afternoon—the Prime Minister is still causing damage for him to clear up by denouncing the likes of Chancellor Kohl and Prime Minister De Mita in Wednesday's Times as "socialists and standardisers". The right hon. Lady's vitriolic comments about all foreigners is breathtaking. This is the very right hon. Lady who, just three weeks ago, embraced the Single European Act which says in its preamble: Moved by the will to continue the work undertaken on the basis of the Treaties establishing the European Communities, and to transform relations as a whole among their States into a European Union. That is the right hon. Lady who, in Bruges violently attacked people trying to suppress nationhood and concentrate power at the centre of a European conglomerate.

Mr. William Cash (Stafford)

Will the hon. Gentleman give way?

Mr. Robertson

Let me just finish this contrast, on which I am sure the hon. Gentleman will agree with me.

The very same right hon. Lady signed the Single European Act, which amends article 100A of the treaty of Rome, thus: The Commission, in its proposals envisaged in paragraph 1 concerning health, safety, environmental protection and consumer protection,"— note the words that follow— will take as a base a high level of protection. This is the same right hon. Lady who last week hit out at a lot of countries in Europe who think in a socialist way.

Mr. Cash

rose—

Mr. Robertson

Who is the right hon. Lady thinking of? Is it Italy, Belgium, Germany, Denmark, the Netherlands, Portugal or Ireland? Which of those are the covert Marxists under the bed of the European Community who were singled out for that vitriolic attack?

Mr. Cash

The hon. Gentleman referred to what the Prime Minister said with regard to European union, but, as he well knows, the expression "European union" means many things to many people. What is clear beyond all doubt is that the Prime Minister is rejecting a united states of Europe of a federal kind. Does he accept that there is a great distinction between that and a lot of the verbiage and woolliness that is associated with the expression "European union"?

Mr. Robertson

The hon. Gentleman knows perfectly well that "European union" means as much as anybody cares to make it mean. The preamble to the Single European Act refers to a precise form of wording adopted in Stuttgart. I advise the hon. Gentleman to look at that.

We know some of the things that the Prime Minister is against—Socialist standardisers, and the harmonisation of workers' rights—but no improvement is made to the way in which people are looked after by way of improved child benefit and social welfare in general. What we would like to know—as would other Conservative leaders in Europe—is what the Prime Minister is in favour of. The Prime Minister's incoherence is matched only by her inconsistency. She has created a ruin of European policy and has left her hapless Foreign Secretary to travel the capitals of Europe trying to rescue this country's reputation.

If the hon. Member for Stafford (Mr. Cash) looks at the shambles among the Members of the European Parliament representing the Conservative party, he will see that great divide taking place there, too. I believe that one group of them are called the blue circle group. Before I heard that expression relating to Members of the European Parliament, I thought that the blue circle was something to do with cement—but perhaps the density of both have something in common.

The Bill is about real cash. It is about lots and lots of cash. It is about so much cash that it makes the child benefit uprating look like small change indeed. The Secretary of State for Social Security died a political death this afternoon over £200 million, but the Paymaster General was made chairman of the Tory party for losing £1 billion to the Brussels bureaucracy. Where is the justice in that?

The Bill legitimises a contribution of £765 million for past overspending by the Community. The bulk of it was spent on producing and destroying food that nobody ate or wanted. The Bill provides for an automatic cash transfusion to Brussels, thus ending the embarrassing democratic necessity of coming to the elected Parliament of the United Kingdom to gain authority to pay ever larger subventions to the EC. The Paymaster General is disingenuous, to say the least, when he suggests that there is no change. The scale of the increased contribution and the increase in own resources will preclude further debates such as this. That may come as a relief to him. It may come as a relief to you, Mr. Deputy Speaker, but our democratic process has hitherto provided us with many opportunities to discuss the implications of added expenditure on the EC.

The Prime Minister gave us an idea of her view about a united Europe when, at Bruges, she said: Certainly we want to see Europe more united and with a greater sense of common purpose. But it must be in a way which preserves the different traditions, Parliamentary powers and sense of national pride in one's own country; for these have been the source of Europe's vitality through the centuries. That is what we have said in every debate on the Single European Act. It is what we have said in every debate on European Community finance. I am glad that the Prime Minister has been converted. One assumes, therefore, that she will tonight vote for our reasoned amendment.

Mr. Dykes

If the hon. Gentleman compares this extra money with that required for the child benefit uprating again, it will be the fifth time that he has done it, so presumably it would be unnecessary repetition. We thank him, however, for drawing our attention to that point. Will he now get on to the more important argument and tell us why the Labour party is now enthusiastic about membership of the EC, whereas it was not before? Why the change?

Mr. Robertson

rose—

Mr. Deputy Speaker

Order. Such a response would be a bit wide of the matter before the House.

Mr. Robertson

I am glad that the hon. Gentleman has underlined the importance of the contrast between the Government's parsimonious attitude towards the welfare of small children and their profligacy with regard to the European Community. The hon. Gentleman and I share some views about the future direction of Europe. Perhaps we can discuss them at another time and at another venue. As he says, the Labour party's policy is evolving, just as the Community's policy is evolving. The Prime Minister's policy, however, is revolving and nobody knows from one minute to the next where she will point.

The same lady has lauded parliamentary power, but we are to be denied the fundamental and elemental power to decide what we should pay to the EC. The Bill rubber-stamps a huge and unprecedented increase of more than 25 per cent. in our contribution to the EC. Some £300 million a year is to go—in addition to the present £1.3 billion contribution.

One of the House's most assiduous attenders of these debates is absent today. I noticed that he paid a fleeting visit to the Bar of the House and then shot off as quickly as he could. We all miss the hon. Member for Mid-Worcestershire (Mr. Forth), who accepted the Queen's shilling. His criticism of the Government in these matters will now be completely muted and I am sure that, at 10 pm, he will vote loyally with the Government so that they can make the payments to which he has previously spent so much time objecting.

Despite all the savings in the Community during the summer and the freak "one-off" conditions that led to a 2 billion ecu ceiling in the 1989 budget, cereal surpluses are still set to rise again next year and the cost of the farmers will continue to cripple us all. Like the 1985 Fontainebleau miracle cure, this package is wrapped up in so-called legally binding financial disciplines. We are told to trust these promises, just as pensioners were told by the same Government to trust their savings to the promises of Barlow Clowes. As the Brussels promises go sour like those of Barlow Clowes, the Government will exonerate themselves, just as they have in the City of London.

The Bill represents another tragedy. It is the manifestation of the iron lady who melted—the empress with no clothes left on her, or the warrior winning battles but forever losing wars. Her petulance certainly gets attention, but in the bargaining about Europe's future it loses us the case. As she abuses Right-wing leaders of Germany and Italy as if they were London borough Labour leaders, their technical standards are chosen for the European norm and their qualifications get common endorsement throughout the Community. She gets the headlines—they get the goods. As she resiles on everything that she has signed, they are making the rules for the future and we have to follow. It is a dangerous and unproductive tactic for our country, and the right hon. Lady is being exposed every day.

Nowhere is the Government's failure more marked than in the help provided for Britain's hard-pressed regions. In her Bruges speech, the Prime Minister said: It was absolutely right to decide that agriculture's share of the budget should be cut in order to free resources for other policies, such as helping the less well off regions and training for jobs. The Paymaster General had the nerve and brass neck to quote that sentence to us from the great Bruges speech.

Mr. Alex Carlile (Montgomery)

The hon. Gentleman has delivered us a very amusing, destructive speech, which we have all enjoyed. His party seems to be against the intergovernmental agreement and against the own resources decision. What would a Labour Government have attempted to negotiate as an alternative? What is the Labour party's policy on European funding?

Mr. Robertson

rose—

Mr Deputy Speaker

Order. I hope that the House will have regard to the fact that we are debating the Third Reading of the European Communities (Finance) Bill.

Mr. Robertson

If the hon. and learned Gentleman will wait, he will hear, in the context of this Third Reading debate, our vision of what Europe should be doing. It is in stark contrast to the remarkable vision that we are being offered in Bruges and in the columns of The Times. It is nice to welcome the hon. and learned Gentleman, who is a rarely seen face, to these debates. We always like to add to the small club of Members who have been to many such debates. I believe that the general secretary of the Campaign for Nuclear Disarmament has joined the pocket commando who leads the hon. and learned Gentleman's party today. It will be interesting to see what his party's European policy, never mind its defence policy, will be.

We all say, "Too true," in response to what the Prime Minister has said about regional aid. We all agree that helping the less well-off regions is a commendable objective. That is especially true for those of us who come from Scotland, where we have 20 per cent. unemployment, where manufacturing industry has been devastated and where poverty and deprivation are at historically high levels. The Prime Minister promised aid for hard-pressed regions, but there are several in her own country. I refer not only to Scotland, but to Wales, the north of England, Merseyside, the west midlands and the north-west, which have also fallen into that category. They all look forward to hugely increased Community funding.

The lamentable truth is that the Government agreed to a doubling of the EC's structural funds to help the regions—the European regional development fund, the European social fund and the guidance component of the common agricultural policy. They agreed to a doubling to £8.5 billion a year by 1992. The Bill would make that agreement legal, six months and £700 million later, but Britain's regions will be worse off.

Mr. Brooke

It will be 1993.

Mr. Robertson

It will be the end of 1992 or the beginning of 1993, but I stand corrected if that is of any symbolic importance. By the end of 1992, the figure will be £8.5 million. The question that the House needs to ask this evening, even if there is no expectation of a reply, is, how much of that will Britain get?

I believe that Britain will be worse off as a direct result of Conservative Government policy and incompetence on a monumental scale. The Government have so downgraded Britain's own regional aid, as the hon. Member for Northampton, North (Mr. Marlow) had the nerve to proclaim earlier, that they have as a consequence disqualified virtually the whole nation from a new source of cash, because 80 per cent. of all the newly inflated funds will go to objective 1 designated areas, which will not be reviewed until 1992 or 1993, as the Paymaster General reminds us.

In the whole of the United Kingdom, only Northern Ireland falls into that category. All the rest of Britain's hard-pressed regions will have to fight it out for what remains—20 per cent. of the cake. To get even what we get at the moment—last year we got £848 million in structural funding—Britain will have to collar three quarters of all that is left of the funds after objective 1. In anyone's language that is simply not on, as we have to compete with all the deprived and poorer areas of the other 11 nations.

In February, the Prime Minister boasted to the House that we could expect to get £1,000 million from the structural funds by 1992. Not for the first time, she is living in a fantasy. Reliable estimates suggest that Britain's take from the newly doubled funds will probably not be more than £200 million next year—a cut of 75 per cent.—when tonight we are endorsing a 100 per cent. increase in the total available for dispersal. Is that what the Prime Minister means by value for money?

The dismal story does not end there. This week the Minister of State, Foreign and Commonwealth Office, the right hon. Member for Wallasey (Mrs. Chalker) who regrettably cannot be present, and who I had warned about such a view, spent her time at the Foreign Affairs Council mounting a bid to prevent the European Community from insisting that payments from the Community must finance new job-creating projects and not just subsidise those that had already been planned by the Government.

Britain alone of all the European Community countries wants all the cash to go into the Treasury black hole, thus depriving the regions of even the little that will be salvaged from the structural funds next year. Rather than match the Community's spending in Britain's poorest, hardest-hit and most deprived areas, it is clear that Ministers will be prepared to sacrifice the lot. That is only one illustration of the parsimonious way in which the Government are treating the regions and the structural funds. My hon. Friend the Member for Sheffield, Central (Mr. Caborn) who has been pursuing the matter with Ministers, has more than adequate case law to suggest that the Government are penalising local authority schemes in favour of the schemes dreamed up by the Secretary of State for Trade and Industry.

Mr. Holland

That is really scandalous.

Mr. Robertson

It takes special, almost unique incompetence—as the Bill does today—to be forced into upping Britain's payments by 25 per cent. and doubling the structural funds, only simultaneously to see Britain's revenue from them drop from £800 million to £200 million. It takes real malicious, malign incompetence then to demand that we do not even spend on the new programmes for which the funds were designed. The Government stand indicted.

There is a real vision of Europe that the Prime Minister very often seems to forget. We share the vision of economic expansion in the European Community, but economic expansion that lives side by side with balance in the Community, with fairness and with a sense of community. We seek, not bureaucracy, but proper curbs on unrestrained free movement of capital and business; not centralisation, but joint action to deal with the problems that we face in Europe; not the paranoid nationalism that we seem to be hearing from the Prime Minister, but a genuine awareness of what can be done and what needs to be done for the people of Europe.

The very wise commentator in the International Herald Tribune, Mr. William Pfaff, who by no stretch of the imagination can be described as a Marxist—even by the Prime Minister, who believes that Chancellor Kohl is a covert Marxist—talks about the useful, constructive and valuable project that the Community is embracing in research, artificial intelligence, advanced electronics and space. He writes: These are providing Europe with basic research and technological applications crucial to European industrial competitivity, but come at a time when Britain, once Europe's leader in science, has abandoned or drastically reduced public funding for basic research, cutting itself off from research which private business is unwilling or unable to pay for. He concludes by referring to the political impulse to put shallow thoughts into gross slogans. That sums up Her Majesty's Government's view of the European future more properly than anything that the Prime Minister said in Bruges.

The Bill represents the Prime Minister's failure and her reckless submission on financial common sense, but Europe is now moving ahead. Our amendment reflects the Bill's defects and the wasted chances, but it is now time that we learned from these defects and these problems what represents our collective future. I urge all hon. Members to support the amendment.

6·37 pm

Mr. Hugh Dykes (Harrow, East)

I wish to intervene at this early stage to make just three or four points, as I know that quite a large number of hon. Members wish to speak in this Third Reading debate.

It was pleasurable, fascinating and interesting to hear from the spokesman for the Labour party, the hon. Member for Hamilton (Mr. Robertson), perhaps the strongest words in favour of the Community that we have heard from the Labour party. We were urging him to reveal some aspects of Labour policy directly related to the Bill on Third Reading so that we can know what transformation has been achieved, apparently, since the conference season—the TUC conference and the Labour party conference, where the Labour party seemed as usual to respond to the urging of its TUC paymasters and TUC directors of studies—so that it should now become more enthusiastic about membership of the EC.

Unfortunately, the hon. Gentleman said only that the House, Parliament and hon. Members must wait. He said, "Labour policy is evolving; give us a chance to make sure that we know how to construct it and what it is." We recall that Labour's response to the Brussels summit was uniformly hostile. Now, grudgingly at least, the Labour party is taking the first step in the right direction and saying that the Community and our membership of it are a good thing. All the nit-picking about the excellent Bill so ably promoted by my right hon. Friend on Monday and today is just so much smoke-screening, as the House will fully recognise in the hon. Gentleman's remarks and, presumably, those of his colleague who winds up the debate.

Mr. Robertson

I intervene at this stage to allow the hon. Member for Harrow, East (Mr. Dykes) to get on to more constructive things. I shall not delay the House. The decisions of the Labour party conference are published and available to the hon. Gentleman and to the public in general. I quote simply one sentence from the report of the policy review group "Britain in the World", which states: Labour will work within the Community to achieve our democratic socialist objectives in Britain and construct a new agenda for Europe. I do not think that the hon. Gentleman can make much more heavy weather of making fun of the Labour party. The policy is there and I advise him to read it before he makes his next speech.

Mr Dykes

I am still puzzled by the fact that the hon. Gentleman, who is usually properly thick-skinned, was so touchy that he felt he had to intervene to make that point. It shows how brittle things are in the Labour party.

I am not saying that simply as an irritating point but because, by direct inference and linkage, the hon. Gentleman was saying that there had been a "revolving" of the policy stance of the two major parties. The hon. Gentleman used the word "revolving" in a different context, but it fits in here. He was saying that Labour is, magically, and at long last, what constructive Europeans and honest patriots—I hope that I am both—have been waiting for. He said that the first sign of enthusiasm by the Labour party about the details as well as the general aspects of our membership of the Community is at last here to be testified.

That was also interesting for the hon. and learned Member for Montgomery (Mr. Carlile), who is to speak for the Democrats. The hon. Member for Hamilton sought to imply that there had been a change of attitude among Conservative Members about our membership of the Community, as well as a change in our response to the Bill. I can assure him that he need not worry about that, because that is not the case.

I wish to develop the notion, which is entirely credible, not least when one examines the Bruges speech, that the Conservative party is still quintessentially the enthusiastic European party and that nothing has changed fundamentally or in certain important details. That is why the Bill will be overwhelmingly passed by Conservative Members.

Mr. Marlow

My hon. Friend has noticed the way in which the Labour party is embracing Europeanism. My hon. Friend, as we all know, is a fanatical European, and that is surpassed only by his fanatical Conservatism. Does it not give him cause for concern that the visit of Mr. Delors to the TUC and the change in Labour party policy has come about because it sees that we now have a Europe fit for Socialism?

Mr. Dykes

My hon. Friend is famous for his simplistic explanations. I wish that such a simplistic explanation were the case. However, it is not as simple as that. The Labour party is obstruse, complicated and incomprehensible to its members in the House and outside, and Mr. Delors has been misquoted and misrepresented. In response to the urging of Members of the European Parliament, he was partly giving some of his personal views.

However, he also said—I do not have the exact quotation, but I remember it vividly—that it is essential for the national parliamentary systems and the governmental responses of all member states to be thorough, adequate, robust and vigilant to ensure that they respond to the possibility of the centre of gravity moving to Brussels. In our constitutional description, we would, of course, talk of the centre of gravity moving to the Council of Ministers.

As a result of that, scrutiny exercises such as those pursued by the House would be even more important in the future, as would the welcome development of the European Parliament—[Interruption.] It is a pity that the hon. Member for Bradford, South (Mr. Cryer) does not approve of that. Such scrutiny exercises would provide an extra democratic layer of supervision and control of the developing Community. Mr. Delors was urging Community states to proceed along those lines. I am sure that I am not misrepresenting him.

My next point involves major areas of constitutional supervision by the House. The Chairman of the Select Committee on European Legislation, the hon. Member for Newham, South (Mr. Spearing) is in his place. I pay tribute to him for the quality of his contributions in debates as well as his amazingly assiduous attendance. I hope that I have not embarrassed him by that genuine tribute.

On Monday, we saw nit-picking about the Bill by a few hon. Members. There are a diminishing number of anti-marketeers still in the House. Some of those anti-marketeers are members of the Conservative party, although not many. They are not of tremendous significance in the total contribution, although they are all as individuals distinguished Members who make distinguished contributions. They know that they are on a losing wicket and are fighting a losing battle.

The Bill is a major constitutional matter as well as a financial measure, and I contrast the nit-picking on such measures with the deserted character of the Chamber when we are carrying out late-night scrutiny of individual instruments. I say that, not in respect of the hon. Members present today, but in respect of others who attend only on occasions such as this or during the height of our principal deliberations, but do not become involved in the individual late night scrutiny of items that is needed on many measures. That is a pity. They pay lip service to scrutiny, pretend that it is important, but do not take the slightest interest themselves.

I link to that the amazing double standard that is illustrated by the fact that they do not pay the slightest attention also to the billions of pounds of national public spending on which we often vote late at night and about which we read in the newspapers the following day and their nit-picking, hysterical reaction to the smallest amounts of Community money voted in collective decisions between member states or agreed in Community budgets.

I welcome the Bill and I congratulate heartily the Government, the Prime Minister and the Treasury team on their achievements. This is pleasurable for those of us who are impatient about the slow development of the Community. We do not wish to see anything like the terrible "federalism", which is a word now replacing the phrase "Reds under the bed" as the scare story of the late 1980s and early 1990s. As far as I am aware, no one is suggesting that we should move towards federalism, and certainly no one supports the United States concept of one federal Government. The Bill represents sovereign countries co-operating more and more with collective benefit and genuine reciprocal enthusiasm because they observe greater benefits for the greater good.

Mr. Cash

Will my hon. Friend give way?

Mr. Dykes

I would like to, but time is moving on.

Developing the Community is directly to be compared with history. There is the old argument about getting one single nation together for the common good. We see the same thing now increasingly accepted as a matter of little controversy in member states. Unfortunately, it is controversial in this Parliament, but it should not be. In Denmark there is an eccentric attitude from some Members of Parliament, but not many. The other member states take a calm stance and it is not a controversial matter.

When the scare story of federalism was raised again, the reaction from French politicians, the French Government and French official spokesmen was just as sharp. They said that it was an absurd idea and that things would not develop in that way. In many ways, France is as nationalistic as Britain.

Mr. Cash

Will my hon. Friend give way on that point?

Mr. Dykes

I will not give way, because my hon. Friend has intervened several times.

Mr. Cash

rose—

Mr. Dykes

I do not intend to give way.

Mr. Cash

rose—

Madam Deputy Speaker (Miss Betty Boothroyd)

Order. It has been made clear that the hon. Gentleman does not intend to give way.

Mr. Dykes

If my hon. Friend travelled to European countries more often, he would see the way in which politicians operate a restrained political system rather than a hysterical one, which is what we see so often here.

Mr. Cryer

Dull, like a graveyard.

Mr. Dykes

That is a matter of opinion. It is more mature in many ways, unlike the hon. Member for Bradford, South.

The reaction to the canard that federalism was on the way was just as sharp from France as from Britain. No one has suggested that, least of all Mr. Delors.

In practical ways, through the own resources decision and the intergovernmental agreement, the Bill takes our practical, financial, political and operational membership of the Community a vital and useful stage further. The Treasury Ministers have led the way by negotiating the decisions and putting them into the Bill. As the Bill is passed, which I hope it will be, it will become part of the treaty and part of the constitutional background of the Community. Because of the surplus of resources that appears to he developing, and which may continue into 1990–91, I hope that the Community will be spared the superficial attacks that it has received in recent years.

There have been phoney arguments about extravagance and overspending. I agree that agricultural spending needed to be curbed and controlled more effectively, and that now appears to have happened. When compared with the way in which the Governments of member states, including ourselves, were spending public money, the arguments were phoney, as we are realising more and more.

If, as I assume the Bill is passed tonight, we can proceed, armed with it, to the next, more mature stage of our membership of the European Community. We shall get rid of silly debates in which we are extremely offensive about foreigners. We should be very offended if we read of references in the National Assembly or the Bundestag to foreigners who cannot be trusted or worked with because they do not have a sense of fair play, yet we hear such nonsense again and again in the House. We should welcome and accept membership of the European Community, which fortunately, as I acknowledge with pleasure, the Government do. As was shown in the Bruges speech, the Government remain in all fundamental details an enthusiastic member of the European Community.

My right hon. Friend the Prime Minister has reiterated her profound commitment to it. That is the reality of our political, financial and economic position of the future. I therefore welcome the Bill.

6.51 pm

Mr. Nigel Spearing (Newham, South)

I am pleased to follow the hon. Member for Harrow, East (Mr. Dykes). He and I have disagreed on these matters over the years, but in more recent times we have understood our differences better. I shall follow him with what I hope will be a measured speech which takes an entirely different point of view from his.

The Bill provides a further tranche of money—which does not have to be voted on in the House for the next five years—to a Community that is now a different legislative machine from the one that it was 18 months ago. The Community is not only spending money on various programmes—familiar to those of us who attend late-night debates—but it has new legislative powers. The money on which we are voting is to fuel that legislative machine—modest though our portion may be—and to provide for money services, which we habitually debate.

I am grateful for the tribute paid by the hon. Member for Harrow, East for some of the work that we do in the Select Committee on European Legislation. He is a regular attender and he contributes most usefully to its procedural work. But even he will agree that, however perfect any scrutiny is—and it is by no means perfect at the moment—what is decided in debates on European legislation in the House, which are thinly attended, as the hon. Gentleman knows, is only advisory. I suggest to him and to other hon. Members that some late-night debates are poorly attended, partly because of the technicalities involved and partly because their outcome may have no decisive effect, as the Government themselves have to make decisions.

In Committee on Monday, I made comments about media gaps. In the past few weeks, we have read a great deal about the Community. I made the extraordinary allegation that most of the comments that I read, heard or saw on television avoided the centralities. I have not been challenged by the media since then and, as I am the Chairman of the Select Committee to which the hon. Member for Harrow, East referred, I must put on record five gaps that I espied, not as Chairman of that Committee but as an individual, although I have knowledge that arises from membership of that Committee.

The first relates to the Government's publicity campaign about 1992, "Open for Business", for which the Bill provides money. The campaign speaks of barriers coming down, of great opportunities and a great leap forward. However, in 1973 it was said that that would happen by 1979, at the end of the years of transition. We now have a manufacturing debt to the EEC of £10 billion a year, although we began in 1972 with a modest surplus. If that has happened since 1973, when tariff barriers began gradually to disappear, what will happen between now and 1992? On common-sense grounds, one would assume that the position would get worse. Nothing in the Government's £1 million advertising campaign and nothing that has been said by the hon. Member for Harrow, East leads me to believe otherwise.

Apparently, the media have accepted that the opportunities will be of net benefit rather than net disbenefit, forgetting that the White Paper produced by the right hon. Member for Old Bexley and Sidcup (Mr. Heath) in 1972 said that the benefits of entering the Community would be positive and substantial, and they turned out to be substantial and negative. What is to prevent the same thing from happening between now and—I am tempted to say—1992, which brings me to my second point? There is a further lacuna in the media coverage—a major fault even at the BBC. The date is not 1992; the change is taking place now. The period finishes formally on 31 December 1992 when article 100B takes effect, but legislation is coming forward now. There is to be no big bang at any time, let alone in 1992.

My third point relates to M. Delors's "social dimension". It is not part of the Cockfield package, and article 100A specifically omits rights of employed persons. Their interests are still protected—some would say advanced—by unanimity. They are not part of the package specifically singled out for legislation. The proposition is therefore of a different order from that to which we are already committed.

Fourthly, majority voting, with a requirement of 54 votes and a blocking section of 23 votes, means that legislation opposed by the Government and the House can still become law in the United Kingdom.

My fifth point is perhaps the most important of all. We are told that the frontiers are coming down. We see pictures of lorries and there is talk about tariffs, customs posts and all the rest of it. That may be true, but the fundamentals are very much more important. Article 8A refers to an area of a single market "without internal frontiers". If we took a ship from London to Lisbon, we should not pass a geographical frontier. In terms of trade and in other ways, however, we should be passing a frontier because Portugal has different laws, regulations and habits from ours.

It is clear that the frontiers are not geographical frontiers, which we pass with luggage or lorries; they are differences of law. Any statute capable of amendment under the treaty of Rome that affects competition or could be said to create different conditions—any commercial or industrial regulations, for example—will thus constitute a frontier. Therefore, we do not know which areas will be susceptible to the application of articles 100A and 8A. Any difference of law either side of the industrial, or paper, frontier thus becomes potentially susceptible to the application of article 100A. At that point, the central power takes over and national legislation is potentially subject to legislation from the centre.

The potential area for legislation is great indeed. We are used to talking about scope in the House. The competence of the emerging European union to impose pre-emptive legislation on its member states is colossal and as yet undefined. I can say that clearly because the Select Committee on European Legislation is examining an aspect of that subject in one of its inquiries. Before suggesting possible legislation, any member of any legislature—any official in Whitehall—will have to ascertain whether it is covered by the treaty powers that the House voted to give to the emerging central European union.

We shall have to think whether we can put anything in place that might clash with what the Commission might propose. The Commission has enormous powers of proposition. It may appear to be a small civil service—it has been compared to Scotland's—but the Council of Ministers cannot propose legislation or regulations because the proposal must come from the Commission. The actual and potential powers of the Commission precede, pre-empt and prevent wide sectors of national legislation. By treaty, the Commission alone has the prerogative of initiative.

We are living under a written constitution for a European union. I stress to Conservative Members—even to the hon. Member for Harrow, East, who knows much about these matters—that talk of federalism is not accurate because it immediately conjures up something that is not in the treaty of Rome. The Prime Minister either knows that very well when she talks about a united states of Europe, or she does not understand the point.

Nation states may be federal or unitary in structure. The nature of the European union is unitary and does not need any new legislation to create a federation such as the United States of America or the Union of Soviet Socialist Republics. The constitutions of those countries are remarkably alike. All that is required is competence ceded to a central law-making authority, which by treaty or constitution automatically takes precedence over anything else.

Mr. Cash

The hon. Gentleman and I are on the Select Committee on European Legislation. It strikes me as odd that he is saying that there is no federalism in the structure of the European Community. He is attempting to say that, effectively, it is a unitary state in embryo. I refer him to any work of standing on the subject, especially a book published by Professor Rasmussen, in which he says: Do the fundamental characteristics of the European Community's governmental structures and its division of powers exhibit the essential features of federalism? The reply is in the affirmative.

Mr. Spearing

I have not read the chapter to which the hon. Gentleman alludes, but I should be pleased to enter into correspondence with the author of the book or anyone else, because I fail to detect any element of federalism, to which the book refers.

Britain is a party to the Struttgart declaration, which was quoted in Committee last Monday, to transform the whole complex of relations between their States into a European Union. When the Secretary of State for Foreign and Commonwealth Affairs was asked about this by a Select Committee, he said that it was done by a variety of legal bases, including the treaty of Rome, the Single European Act and a number of other unspecified treaties. I believe that that is the reality because it is a written constitution.

Mr. Spinelli and Mr. Tindemans have produced constitutions that were widely discussed at the European Parliament in Strasbourg. They may have contained elements of what the hon. Member for Stafford (Mr. Cash) referred to or what was hoped for by people who are generally called European federalists.

Mr. Dykes

I agree with the hon. Gentleman that we are not discussing a federal proposition or structure either now or in the future, but is he not wrong in saying that it is unitary because it is a unique new creation of sovereign member Governments increasingly working together and, we hope, with majority rule? We can call it by a new designation, say it is a confederation, a community or what it is—a treaty, like the Atlantic treaty or the NATO arrangements, albeit with more institutional effort and substance. To say that it is like a unitary state is manifestly absurd.

Mr. Spearing

These are vital matters. The structure is not like NATO because the EEC is not a taxing or law-making body. It is true that it is a new sort of unitary machine, but it is, nevertheless, unitary, and that is a distinction that the hon. Gentleman should make. There is no place in the treaty of Rome for participation by national bodies other than by their customary constitutional requirements, as the Paymaster General said earlier. There is no formal giving or division of powers as one finds in a federation or confederation.

Article 236 of the treaty requires common accord and, despite the opposition of the Prime Minister at Milan, a conference was called to bring forward the proposals regarding the Single European Act. That whittled down many of the aspirations of Mr. Spinelli and his friends. I have no doubt that the Foreign Office thought that they had been whittled down so much that their "federalist aspects and tendencies" had disappeared.

There was much disappointment in Strasbourg when the Single European Act appeared. I have no doubt that the Government were not enthusiastic about it and said, as we often say ourselves, "It was the best we could do." What was not understood—I am not sure whether the Prime Minister, the Foreign Office or anyone else understood this—was that the Single European Act, especially article 8A, contained the magical words "without internal frontiers." That is the fulcrum of an enormous edifice of legislative prerogative, which we are only just beginning to understand.

If the House or any listener or professor who writes books on the subject disagrees with me, I should say that this insight came only through listening to the exposition of Lord Cockfield, who before the Treasury Select Committee emphasised this very point. The whole edifice of the CAP is founded on the magic words "stabilisation of markets", which are found in the treaty. The three words "without internal frontiers" create a new legislative machine, of the boundaries of which we are unaware.

A few hours ago we were discussing a subject of tremendous public concern—social benefits. Under a unitary European state, if there is to be perfect competition, social benefits and taxation will surely have to be harmonised. I was reading some Conservative literature from about 15 years ago in which that was foreseen.

Powers that we think lie with Whitehall are moving. We have recently heard much talk about mergers. Does the House realise that the powers to determine whether mergers should take place will move from Whitehall to Brussels? In an answer to me on 25 October, the Attorney-General said that six courts in this country have referred cases on Sunday trading to the European Court, and 100 laws have been passed under the Cockfield package on majority. What next?

In the referendum we were told that the position of the Queen would not be affected. I suspect that people who said that did not understand what the position of the Queen meant, because all the legislation from Brussels does not come before the House, receive Royal Assent or go to the Privy Council; it bypasses the sovereign and therefore bypasses sovereignty. It represents a new European imperium whose prerogatives of legislation are so wide that they are indefinable.

Realisation of that fact, as well as other factors, caused the Prime Minister to make her Bruges speech. She now realises that Government and Parliament may he facing some very nasty medicine, which has been brought upon us by the Single European Act. If the Prime Minister realised that, why did she espouse it and not bring the information to the House? 11 have a charitable solution to that conundrum. I do not necessarily think that the Foreign Office or the Prime Minister knew of its implications; or if they did, they did not tell us. It is one or the other—either they did know and did not tell, or they did not know, and we are now finding out. I suggest that this is a major constitutional matter.

If the Foreign Office and the Prime Minister knew and did not tell us, that is a major political and constitutional issue. If they did not know, we have been conned as a nation, both while going into the European Community and while staying in it on the terms so far negotiated. We are now just waking up—even those of us who try to follow these matters—to the details of the constitutional mechanism by which we have been made subject people in respect of majority decisions on Brussels laws.

Because what we read in the press is not always accurate, I should like to get on the record exactly what Mr. Delors said when he spoke, not to the TUC, but to the European Parliament in Strasbourg on 6 July this year. He said: In ten years time 80 per cent. of economic legislation and perhaps even fiscal and social legislation will be of community origin. That was a forecast. He did not say, "of all legislation"; he said: of economic and perhaps even fiscal and social legislation". He implied that, of the totality of legislation, less than 80 per cent. would be from the Community. The Sunday Times was aghast at that. In its leading article on 25 September 1988, it said:

No serious person, bar Mr. Delors, really believes that 80 per cent. of Europe's social and economic legislation will be decided in Brussels within 10 years; or that, in Mr. Delors' phrase, it is time to create 'an embryo European Government'. I have news for Mr. Delors, and perhaps for the Prime Minister and hon. Members. What proportion of the laws to which we are now subject have originated in the United Kingdom, in this Chamber, and what proportion in Brussels? I had a look the other day and found that there is about 65 ft of library space of combined United Kingdom and Brussels legislation to which we are all subject and which has been passed since 1958. One may say, "Why 1958? I thought that we had joined in 1972." But when we joined in 1972, we took aboard everything which the EEC had legislated for since it started and which had not been repealed. I hasten to add that some of that EEC legislation would have been repealed since that time.

What is the proportion? Between 10 and 11 ft is United Kingdom legislation and about 54 ft EEC legislation. One may say, "But the EEC legislation is much more 'detailed." It is, and we must remember that our legislation is on smaller paper with larger print.

All that legislation is not from a proto-federal EEC, but a European union that now exists. The volume of legislation can be measured, but measurement is not necessarily the critical indicator. What is important is the nature of the legislation and the scope of the legislative superiority already ceded by treaty to EEC legislation. The Bill provides the political petrol for that emerging European Union. It does so automaticaly, without vote, for funds of between £4 billion and £5 billion a year, not just to pursue policies on which we can at best only comment and advise, but to support a legislative apparatus which, if it wishes, can dominate the executive and legislative arms of the United Kingdom—in common parlance, No. 10 and Parliament. It reverses in constitutional terms the events of 1688.

The power of this new European union has increased, it is increasing and, to modify the old phrase, has now to be contained. The question to which Parliament must now turn its attention and to which the Prime Minister has already directed our attention is, bearing in mind our treaty commitments, how can that be achieved?

7.16 pm

Mr. William Cash (Stafford)

Because many hon. Members wish to speak, I shall curtail my points and limit them largely to the speech of the hon. Member for Hamilton (Mr. Robertson). I should like to make passing references to the speech of the hon. Member for Harrow, Central—

Mr. Dykes

I am an hon. Friend.

Mr. Cash

—who referred to what he regarded as my hysterical outburst on the question whether the French had any federalist tendencies. If he had been kind enough to give way, I would merely have mentioned gently what Mr. Rocard, the Prime Minister of France, is reported as saying in the Financial Times on 24 October: I am clearly a European federalist". I thought that it would be in accordance with the conventions of the House politely to correct the hon. Member on a matter of some importance.

Mr. Dykes

rose—

Mr. Cash

The hon. Member would obviously like me to give way to him. I shall be delighted to do so, although he was not prepared to do the same for me.

Mr. Dykes

I am grateful to my hon. Friend, but then I have not intervened as often as he has. By the way, I am an hon. Friend and the constituency of Harrow, Central has been abolished. It is Harrow, East.

The expression of personal opinions by various politicians in various member states does not constitute a graphology of Community policy. Why does my hon. Friend misrepresent Mr. Rocard's comments? French politicians, including members of Mr. Rocard's party, have been equally severe in saying, "No, we believe in a Europe of nation states." I do not think that my hon. Friend's point adds up to much in this debate.

Mr. Cash

We know that President de Gaulle believed in Europe des patries. I do not think that Mr. Rocard does.

The hon. Member for Hamilton made an interesting speech, turning his withering fire power on my right hon. Friend the Prime Minister. In doing so, he revealed the deficiencies in the Labour party's policy on Europe. The Labour party's policy on Europe is that it does not have a policy; in this matter I agree with remarks made over the past few weeks by some of my colleagues.

What do the Opposition make of the statements by their Socialist colleagues elsewhere in Europe? I have questions to put to them. On budgetary policy, the issue is whether we would want to move to a central bank. Without one, we cannot have the kind of policies proposed by Mr. Rocard. Recently, Mr. Rocard was reported as saying:

The French Government would continue to call for the constitution of a European central bank and would make the required concessions to German sensibility to get it. 'It is an absolute necessity,' said Mr. Rocard". Am I right in thinking that that policy would be pursued by the hon. Member for Hamilton and the Labour party? Do they want a central bank in Europe? Is that Socialist policy? Do they want a situation in which this country no longer has any control over economic policy? That is the corollary to the position that they have adopted. The hon. Member for Hamilton might also ask himself whether he would favour a joint Franco-German brigade in Europe as the embryo of a European army. The budgetary matters with which the Bill deals are directly related to those questions because it is the money that comes to the European Community, through the mixture of own resources and VAT, which enables such things to be paid for.

That brings me to the next question—the very important debate in the European Parliament today in relation to the Prime Minister's statement in Bruges about the future of Europe.

Mr. Robertson

That was yesterday.

Mr. Cash

The hon. Gentleman says that it was yesterday, but the important point is this. One of the main points of a report produced by the Communist Mr. Graziani, with a large number of Socialist colleagues, concerned the attainment of European union. It suggested that the European Parliament Notes that, even if the full potential of the Single Act is exploited to the maximum, it falls short of the Community's requirements, particularly as regards"— these are things that we would be expected to pay for out of the budgetary arrangements, which the hon. Member for Hamilton and his Socialist colleagues in Europe presumbly wish to support— the competence of the Community which is still deprived of adequate means of action in the areas of"— wait for it common foreign policy, security, a common currency with a central bank, energy, development aid, cultural co-operation, eduation, and European citizenship". That is just a sprinkling of the functions to be conferred on the European Government proposed by Socialists such as Mr. Rocard, Vice-President Siegbert Alber of the European Parliament, and so on.

The Labour party is in an impossible situation. On the one hand, Labour Members say that they intend to change the whole policy towards the European Community that they have developed in the past 20 years. On the other hand, they seek to repudiate the very sound position adopted by my right hon. Friend the Prime Minister. They are making complete nonsense of the policies that they have pursued in Europe for the past 15 to 20 years.

Mr. Robertson

I am not sure what that has to do with this debate, Madam Deputy Speaker, but the hon. Member for Stafford (Mr. Cash) seems to be winding himself up. He did not know that the debate in the European Parliament took place yesterday. Had he realised that, he could have read in today's papers that the fate of the report to which he so lovingly refers was to be shelved for the time being. There is a diversity of view about the future of Europe among the various Socialist parties in Europe just as there is among the component parts of the European democratic group, in which the Conservative party remains. Conservative Members of the European Parliament provide a diversity of view ranging from ultra-federalist to ultra-nationalist, which might be a better subject to exercise the hon. Gentleman's mind today.

Mr. Cash

My main point is that the Labour party has in no way explained its policy on Europe. Labour Members' criticism of my right hon. Friend the Prime Minister's Bruges speech has no validity, because my right hon. Friend's statement was entirely consistent with Conservative party policy. She explained in very clear terms that we will not have a united states of Europe, but that our policy will be for a Europe essentially directed towards the peace and security of the people in this country and in Europe as a whole. The Labour party has totally failed to explain what its policies are and on that it stands condemned.

7.24 pm

Mr. Alex Carlile (Montgomery)

In the past, I have been accustomed to speaking in home affairs debates, so I am suffering something of a culture shock today. It has been an interesting experience to read the earlier debates on the Bill, which seem to have thrown up three schools of thought in the House in relation to Europe.

The first might loosely be called the school of European development. I believe that the hon. Member for Harrow, East (Mr. Dykes) belongs to that school, as do I. It consists of those who believe that the Community is not just a beneficial economic organisation but has important political implications for the future. We in that school believe that our prosperity and the essence of our sovereignty are strengthened by joining in the genuine unification of purpose and institutions in Europe. We are the people who have actually read the Single European Act, have understood what it means and have some belief in its aspirations.

The second might be called the school of European nihilism. The hon. Member for Newham, South (Mr. Spearing) spoke from almost the same position in the Chamber as that from which Mr. Enoch Powell used to speak. Apart from the voice—and, if the hon. Gentleman will forgive my saying so, the structure of his sentences, which were Rover rather than Rolls-Royce—it was very much the same speech. It harboured the quaint view that prosperity corresponds with insularity. Members of that school seem to see no value whatever in internationalism and no security in a safe exchange rate mechanism, and to regard Mr. Delors as a nasty foreigner.

Mr. Spearing

I hesitate to intervene, as I had a good slice of time, but I cannot let the hon. and learned Gentleman's comments pass, although I am grateful for his compliments. Is he not aware that I am a very strong internationalist and against the organisation in question because it is not international but supranational? Secondly, does the hon. Gentleman agree that my constitutional points have some validity. Does he also agree that our prosperity is not built just on market philosophies and megamarkets, which may not produce the universal prosperity that the EEC promises?

Mr. Carlile

I will answer the second of the hon. Gentleman's three questions, as it is the most important. The hon. Gentleman's constitutional theories are nonsense. He suggests that the European Community is a unitary state when that is demonstrably not so. I need only repeat what the hon. Member for Harrow, East had to say about that.

The third school of European thought in the House might be called the school of European grudgingness. The Prime Minister seems to belong to that school. She charges from one speech to the next proclaiming, in effect, that we have little interest in political developments in the Community but that we shall continue to take whatever economic advantage there is for as long as it is available. It is not surprising that her approach causes such nervousness and anger even among her conservative colleagues in the Federal Republic of Germany, in Italy and elsewhere, because what she says has diluted confidence in the Community's durability now that the United Kingdom is such an essential member.

It is a matter of regret to me that the Prime Minister is so grudging in her membership of the European Community. However, when the hon. Member for Hamilton quoted a sentence from the Labour party's policy review and gave us the Labour party's so-called vision, the thought crossed my mind that if that was Labour Members' vision they had better get their eyes tested before the Government introduced charges for eye tests. It was an extraordinarily general sentence that could be interpreted by by-election candidates in Govan, Epping or Richmond according to the needs of those respectively inner-city, broadly urban and agricultural constituencies.

The Bill deals with two important issues, the second of which does not merit most of the critical attention given it in the House. The provision for payments to be made under the 1988 intergovernmental agreement is a piece of good housekeeping to ensure that the Community can meet its commitments for the remainder of this year. Opposition to that is opposition to membership—a refusal to pay current debts. Every business organisation, society with members or club keeps accounts at least one year in arrears. This part of the Bill deals merely with reasonable accounting practice.

The first issue, which is much more important, is the approval of the new own resources decision. It is consistent with what my hon. Friends and I have been saying for many years: there should continue to he steady economic and financial integration of the Community.

The concept of structural funds is based on an integrated Community. That does not mean a single nation state; it means an integrated community of a new type and of which the hon. Member for Harrow, East spoke. Parts of our country have benefited greatly from these structural funds.

The concept of 1992 is based on an integrated Community, and there will be great benefit to our citizens—scientists, engineers, business men and professional people—who will be unshackled in the development of British enterprise in the much larger market of the Community. Our financial services sector, especially the big banks, can view 1992 with great enthusiasm, as their greatest opportunity since the heydays of the British empire—provided that we enter fully into the spirit of deregulation and reform. The banks are nervous because they believe that the reluctance of the British Government to deregulate may produce reciprocal action from the French and other Governments.

The Commission's publication, "European Economy No. 35", published in March 1988, shows, without undue optimism, the potential benefits of 1992 for six of our great industries—food processing, pharmaceuticals, motor vehicles, textiles and clothing, building products and telecommunications. Those are only examples of the benefits of 1992.

Of course, the own resources decision has at its core the need to control expenditure, so that national sovereign Parliaments can be persuaded of its propriety. We retain ultimate sovereignty over what is decided; 1992 depends on our retention of that sovereignty, although momentous political changes thereafter may well be the consequence of successful economic integration.

It was with this parliamentary sovereignty in mind that the Twelve arrived at the inevitable decision that there should be stronger limits on Community expenditure, as shown most clearly by the controls provided in the new decision of 24 June this year.

The Government seem to have convinced themselves that they alone, with little contribution from other member states in terms of argument and insistence, have been responsible for the changes now incorporated in the Bill and for new financial discipline in the Community. That is far too smug a claim to be worthy of credence. However, I am happy to see the Government confidently claiming their negotiating successes in the Community and having confidence in their position in it, provided that they are prepared to take that confidence fully into the progress towards 1992.

A confident Government would be prepared at least to examine and discuss the creation of some form of European central bank. They would be prepared to dismantle unnecessary currency barriers which are more appropriate to the politics of Napoleonic Europe than to those of today. They would be confident enough to allow electoral arrangements for the European Parliament to be standardised throughout the Community on the fair basis of proportional representation. I urge the Government to have the courage to show that confidence.

7·35 pm

Mr. Edward Leigh (Gainsborough and Horncastle)

Like the hon. and learned Member for Montgomery (Mr. Carlile), I have taken care to study some of the debates in the House on these matters, particularly the speeches made by the hon. Member for Newham, South (Mr. Spearing). He is obviously an enthusiast for these debates, if not for Europe. Like many enthusiasts for a cause, he shows the attention to detail and the speed, verve and vim of a Geoffrey Boycott innings.

The hon. and learned Member for Montgomery, in his interesting analysis of these debates, was right to say that there has in the past been a dreary stand-off between committed anti-marketeers and the peddlers of European dreams. But he was absolutely wrong to describe the Prime Minister's as a grudging way. What she was trying to say and what the Bill should be striving towards is a truly free-trade Europe, not a harmonised Europe, and a market-oriented Europe, not a profligate one.

As we consider the Bill, we must ask ourselves whether the nations of Europe will be encouraged, as they should be, to retain their national identity and their cultural and linguistic differences. There are other great differences, too—for example, trading and commercial practices. Will the Bill preserve the multi-patterned European heritage? We should not see it as a signpost on a dreary slide to a harmonised, homogenised, sterilised, socialised, federalised, bureaucratised and extravagant pale reflection of the United States.

Will the Bill and our debates on these issues create something entirely new, exciting and beneficial? Will it help to create a new drive towards a deregulated trading consortium of equal sovereign partners, in which goods and services from one country compete freely with different goods and services—unharmonised, if necessary—from other countries across national boundaries, under a system in which the best product at the best price is allowed to win, to the benefit of all consumers? Or does the Bill enhance a process in which harmonisation stifles, rather than boosts, trade? Is the Bill, as it should be, part of a process to give greater, not smaller, powers to the markets, as well as fewer, not more, powers to the Brussels Commission?

The benefits of a single market are enormous, but does the Bill encompass the philosophy that gain in a single market invariably entails pain? The so-called regional or social policy must not be allowed to interrupt the necessity of siting production where it is most beneficial to the consumer, rather than where politicians believe it to be beneficial to their future. Does the Bill encapsulate the essential philosophy of the Government—that a single European economy must respond to the myriad spending decisions of 240 million citizens on the European continent—or will that be stifled by what is politically expedient for a few thousand politicians and officials? Will old-style syndicalism and interventionism of the type that still abound in Europe slow down the process from Brussels, just at the time when those things have lost influence in London?

Will the Bill give more chances for markets to grow unhindered to the benefit of all, or will it enable short-sighted politicians and officials to preserve this or that part of inefficient farming practice or local industry on the altar of national pride and paternalistic regional and social policy?

Does the Bill help to transfer decisions from Westminster and this House, not to Brussels, which would be wholly retrograde, but to a wider and freer market? Will the Bill allow national identities and differences, the very stuff of our history, to compete and flourish while power is decentralised to the individual consumer, not centralised to the European Commission?

The destruction of tariff barriers or tolls that catapulted this country into 19th century pre-eminence, is an essential part of European history. In time, trade barriers between nations will seem as outdated as the old customs barriers that used to divide France into six parts before the revolution, or the 1,000 different customs territories that divided Germany before 1815.

That realisation will bring the greatest leap forward in prosperity in Europe's history. That is the true challenge that faces the House, and the question to which we must address ourselves is whether the Bill meets that challenge.

7.40 pm

Dr. John Reid (Motherwell, North)

Even as a relatively new Member, I have come to realise that in debates such as this one tends to see the same old familiar faces, none of them more familiar—I shall not say old—than that of the Paymaster General, who once again this year has been asked to bear the burden and carry the cross of the Market while the twin Pontius Pilates, the Foreign Secretary and the Prime Minister, again manage to wash their hands of the consequences of their statements.

Once again we are looking at fairly familiar ground in so far as we are discussing the latest in a long series of mechanisms for financing the European Community. What, unfortunately, casts a shadow over this debate, and no doubt any other future debate on the EC, is the Prime Minister's neo-Gaullist romp round Europe. It was not so much the grand Charles of European politics as the petite Maggie who was romping around Europe with her views on the future development of the continent. That is primarily because she has found the erstwhile Churchillian rhetoric to be useless. In Churchill's own phrase, she has been "resolute in her equivocation" for too long. Every time that she has skirmished in her Churchillian mode, we have ended up paying more.

In the course of the proceedings on the Bill and the statements surrounding it, the Prime Minister is trying a different tack. She has now attempted the old warlike Churchillian tactic of the smokescreen. Let us get the facts straight at the beginning. No Opposition Member is suggesting a united states of Europe. Contrary to what the tabloid press has told us, no thinking European, no thinking Briton, is impressed or misled by that charade. It only diverts us from the real issue.

European finance and integration, the open market and 1992 are serious issues. But they exist not to massage the egos of the Prime Minister, Amstrad's Alan Sugar, Sir John Harvey-Jones, William Egan, or any other entrepreneur who wants to parade in the Department of Trade and Industry's £7.9 million advertising circus; 1992 should be about opportunities for people such as my constituents who stand in the shadow of steel privatisation and the economic neglect that the Opposition hammered home to the Government on Tuesday.

We must ask whether the Government are confident that their advertising campaign—their propaganda—is really reaching the parts that it should be reaching. Let me digress for one second to give an example not from my constituency but from another in Scotland. I was recently discussing with a number of managers the prospects for 1992. I said to one, "What about 1992?" He looked at me rather blankly and said, "Well, what about it?" I said, "How do you think we will do?" After thinking for a while, he said, "Well, John, I think that we will qualify again." He obviously thought that 1992 related to Scotland re-entering the World Cup—[Interruption.] Yes, we will qualify. However, more important for that year is whether we will qualify for the challenge of the opening up of the European markets.

All the work on Europe is being hampered by the hoary old ghosts which are being given new life by the Government. In the past few months, the Prime Minister has been busy lampooning some European politicians. I was reminded tonight that if we have learnt one thing during the months of speeches by the Prime Minister, it is that her favourite negro spiritual is not "Hear the word of Delors." It is not that Jacques Delors wants a united states of Europe that so unnerves the Prime Minister; it is the idea that Jacques Delors and those of us who are building a real vision of Europe want to see a liberalised internal market, complemented by a social market. That is clearly not on the Prime Minister's agenda.

It is worth dwelling for a moment on the astonishing rhetoric of a Prime Minister who builds up a bogus issue, primarily to hide the true picture of how little Britain has been able to win from the EC. We have heard tonight in considerable detail from hon. Members with much more experience than I of the negotiations on EC financing over recent years. Let me ask a few simple questions, less detailed but more pertinent.

How is it that, despite the Prime Minister's years of rhetoric, we are still on the receiving end of a CAP budget? How is it that that budget is still out of control? Why is it that the social and regional fund is still merely papering over the cracks of industrial decline and inner-city decay in Britain? We have heard those questions so often before, but every time that they have been asked they have been answered with a deafening silence.

We are now reaching a point where we are becoming desensitised to the obscene level of spending on the CAP, but one fact above all others remains clear. The commitments made at Fontainebleau have not been realised and we have not reduced spending on the CAP.

When the Prime Minister banged her fist on the table in Dublin and talked about "our money" in relation to the EC budget, when she huffed about Fontainebleau, when she puffed about the victorious rebate, we could have been forgiven for thinking, even after so many false starts, that at last we had taken the first steps on the long road to economic sanity. But no such thing. The bitter fact is that next year we face a 25 per cent. increase in our contributions to the EC budget. That the Bill should permit a dramatic increase of 25 per cent. in the budget, after nine years of prime ministerial Churchillian skirmishes in Europe, is a sign of the right hon. Lady's abject failure.

I know that Conservative Members do not wish to be reminded of the comparable value of their contribution to the European budget, but it is worth remembering that last year Britain's net contribution to the EC was £1,649 million. That is more than the Government spent on the National Health Service's capital investment programme last year; it is more than this year's overseas aid budget of £1,247 million; it is more than last year's estimated unemployment benefit of £1,543 million; it is five times more than the Government's capital expenditure of £310 million on education; and it is eight times more than the £200 million of which the Government have, without shame, deprived Britain's mothers and children today.

The Prime Minister's victories in Europe are as empty as her European speeches when it is clear that the figure is expected to increase by about £200 million to £300 million in additional contributions in coming years. It is no wonder that there has been little talk of victories from the Paymaster General today. It is little wonder that the Prime Minister desperately needs to manufacture the spectre of the united states of Europe to divert us from what is really happening to Britain in Europe.

We are in a European Community where new, relatively poorer entrants will be competing for what little money there is in the social and regional fund. The Government do not have a decent social and regional fund for Britain. Indeed, as the hon. Member for Northampton, North (Mr. Marlow) pointed out earlier, we have a Prime Minister who does not believe that society exists, and a Cabinet which does not believe in the principle of regional aid. Therefore, the notion of them struggling for European social and regional aid is alien to the Government. When it comes to the Government and European regional assistance, it is a case of the incredulous in pursuit of the inadequate.

Nevertheless, the debate is timely, coming at a time when we hear that the Government may be forced by new Community rules to increase public spending in the poorer regions and the inner cities by as much as £6 billion more than they had planned over the next four years. Even the Treasury has been shocked into having to face the fact that it is completely out of line with the new rules of the Council of Ministers, who will force the British Government to match EC spending in the regions pound for pound.

The Minister of State, Foreign and Commonwealth Office, the right hon. Member for Wallasey (Mrs. Chalker), earlier this week in Luxembourg, refused to agree to that scheme, but the idea of spending £6 billion on areas devastated by the Government's economic policies must have seemed like a bad dream to the Minister and the prospect of communicating that news to her mistress in Downing street must have seemed like a nightmare. I can scarcely imagine the scene when the Minister had to brief the Prime Minister on the fact that the Single European Act means that Britain can disagree with but cannot veto the new rules which will potentially boost the resources of many local and regional authorities hitherto starved of resources by the Government's cost-cutting exercises.

The tragedy is that, despite the doubling of Common Market social and regional funds, forced through against the Prime Minister's violent opposition, up to a total of £8.5 billion a year by 1992, Britain will be worse off because the downgrading of Britain's regional assistance areas has virtually disqualified the whole nation from the new EC cash.

Lest it be thought that Opposition Members are always critical of and pessimistic about Europe, it must be said that, on this occasion, Europe is moving in the right direction as regards the future of regional finance after 1992. It is leaving the Government behind in terms of imagination, foresight and practical plans to alleviate the worst effects of industrial recession. The Government are now out of tune with the reality of what is hapening not only in our regions, but in European politics, even among their erstwhile cronies on the Right of European politics.

At the Brussels summit in February, the right decision was taken to double spending on regional and social development as we move towards 1992, but all of us in this country must be on our guard to ensure that EC assistance is not undermined by the withdrawal of United Kingdom Government funds. We can no longer allow the Government to cheat—a word much in vogue this week—on their fiscal obligations by allowing Brussels to fund regional programmes which would have to be met, and should have been met, by the Government in any case.

That is not an unfounded fear, because the doctrine of robbing poor Peter to line the pocket of privileged Paul finds no place among the carefully selected biblical quotations employed by the Prime Minister when she gave us the famous sermon on the mount in Edinburgh earlier this year. That doctrine has characterised the Government's philosophy and actions over the past 10 years. At long last, that doctrine has been isolated, even within the Conservative quarters of European thought. The Government and their doctrine are now isolated, even within the hidden recesses of Right-wing European thought.

Time is running out for a Government who can dodge their obligations to invest in our country's future by leaving it to Brussels, in order to reduce their public sector borrowing requirement. Time is running out for a Government who have allowed regions such as Scotland and Northern Ireland to have their flow of resources halved compared with what they should have been under EC law. Time is running out for a Government who have no regional policy and no apparent commitment to investing in regional policy in the coming years.

The new rules point exactly to the difference between the Prime Minister and the rest of Europe, not because they outline any grandiose or misleading concepts of federalism or even because they represent the Prime Minister's European bete noire of creeping Euro-Socialism, but because of the common-sense intent of revitalising the regions of Europe with carefully targeted investment.

The tragedy is that the Prime Minister and her Government could be giving a lead in Europe. They could sponsor a Community where co-operation between sovereign nations stands as an alternative, not a concession, to the integration of sovereign states. They could be fostering a European framework where economic co-ordination and major issues take precedence over enforced harmonisation of industrial bagatelles. They could be promoting a Europe where real competition is promoted by anti-trust legislation, where real individual involvement is enhanced by worker participation and where substantial progress is made in health, safety and security for the vast majority of citizens living within the borders of the Community.

Conservative Members laughed at the word "vision". The hon. and learned Member for Montgomery (Mr. Carlile) demanded details. A vision is not a blueprint, but it is nevertheless powerful. The Prime Minister is incapable of a vision of Europe because she is haunted, in the words of the Communist manifesto of 140 years ago, by the spectre that she thinks haunts Europe. She is living in the past with her political fears, as she is living in the past with her economic policies.

A recent semi-royal tour of an understandably confused Europe confirmed our worst fears. There is no vision of a Europe where all corners of the continent can say that Europe means we can help our unemployed and under-privileged people. There is no vision which says that Europe stands for investment in the inner cities and the poverty-stricken regions. The only real vision that the Prime Minister has, like that of the hon. Member for Gainsborough and Horncastle (Mr. Leigh), is of a deregulated Europe thrown open to the powers of the multinational companies which can make a quick buck.

That is why I maintain that regional policy means more than just money and funds. It is an expression of political will that is now coming from Europe—the will to take compensatory measures so that Scotland, Northern Ireland, the north of England, Wales and the inner cities are not bypassed by the pre-Market orientation of 1992.

That sort of vision takes courage. The Prime Minister revels in her reputation as a courageous politician. She need not fear that a concession in that direction would be jeered or sneered at by Opposition Members. I understand the fears that an admission that we want a Community that will allow us a decent share of regional assistance and compensation for the regions might be seen as an admission that Britain is not doing well, but it is already patently obvious in my part of the country, as it is in many regions of a wealthy Europe, that Britain is not doing well.

Resistance to European assistance in the solution will not disguise the problem, nor will it avoid it; it will only prolong it. That would be bad for the regions, the Government and, ultimately, the future of the European Community. In the long run, the Government will be judged on their actions and on the Prime Minister's statements and attitude towards Europe. Their actions will be judged by the House and by history as a political tragedy of the first order.

7.57 pm

Sir Richard Body (Holland with Boston)

I hope that, before the hon. Member for Motherwell, North (Dr. Reid) makes another speech on this subject, he will do a little arithmetic and add up the hundreds of millions of pounds for which the Government have been responsible in enabling the regions to benefit from such sums of money.

When the hon. Member for Motherwell, North admonishes us for not facing reality, I suggest that he studies the speech of his hon. Friend the Member for Newham, South (Mr. Spearing), who warned us that we were moving towards a unitary state and that it would not be a federal union. The essence of a unitary state is, as I am sure the hon. Member for Motherwell, North will agree, that a legislative body makes laws that apply immediately throughout that state. That is exactly what the Council of Ministers is now doing.

That is also the case in a federal union, but the difference is that, in a federal union, there is a constitution which lays down a clear dividing line between the legislative powers of the federal assembly and those of the state assembly. That is now lacking in the European Community. That is why the hon. Member for Newham, South is right when he says that European union will evolve into a unitary state unless we do something about it rapidly.

I am against the Bill because I think that it will cause us to miss an opportunity, and this we shall come to regret. The Bill is about giving a great deal more money to the European Community for the purpose of promoting further common policies. I have often said in debates of this sort that I am all in favour of common policies for the various parts of Europe, but my Europe consists of 38 countries, not 12. The lesson of Chernobyl, acid rain and many other environmental casualties of the century is that we must work together. As the hon. Member for Newham, South would say, we must work internationally, not supranationally. It will be necessary to spend a great deal of money to save certain parts of Europe.

My constituency borders the North sea, which is highly polluted. Hundreds of millions of pounds will be needed to cleanse the North sea to make it fit for fishing and many other purposes. Other countries border the North sea but are outside the European Community. It is impractical to think that the Community, as it is now constituted, will be capable of formulating a common policy for that purpose. Why should it? Why should countries such as Greece and Spain contribute a penny towards solving the North sea problem?

I am glad that the European Community has been making some noises about the destruction of the Alps. We must understand, however, that the Alps cross the frontiers of seven countries, only three of which are members of the European Community. Those of us who have taken an interest in the matter have seen the Alps deteriorate over the past 20 years. We realise that they are heading towards a major environmental crisis, but we cannot expect the European Community to embark upon a scheme to save them.

Europe, be it 12, 38 or whatever number of states, is not some homogeneous entity. It is enormously diverse in its interests and we need an institutional mechanism that will enable the circles of interest to be identified. The countries that come within the various circles must co-operate internationally to overcome the problems that they share. It will be futile and disastrous for the future of Europe if we assert that Europe is so homogeneous that we can impose common policies even when interests do not converge. I have in mind the new common policies that have been envisaged in our debates and those that we have read about that are being discussed in Brussels, Strasbourg and elsewhere. Common policies will lead only to friction and disenchantment, the very things which the Community is against.

We must realise sooner or later that there is a great diversity of interest. Equally, there are numerous convergences of interest. We need an institutional mechanism—I should like it to be the European Community—that can help to co-ordinate common policies. At the same time, it should act internationally with a view to ensuring that the countries that are in the different circles of interest raise the necessary revenue and enable the common policies to be implemented successfully.

I believe that sooner or later we shall have such a European Community, but the Bill does nothing to advance that ideal. It is an ideal that I believe I share with the hon. Member for Newham, South. Indeed, it is one that is shared by most of us in this place. My hon. Friend the Member for Harrow, East (Mr. Dykes) will insist that we are little Englanders, but those who believe that Europe consists of only 12 countries —I do not wish to be harsh—are in danger of becoming little Europeans.

Europe consists of many more states than 12, and must do many things together to ensure that our continent is habitable and safe for the next century. The Bill will do nothing towards that end, and that is why I regret that it has reached this stage.

8.5 pm

Mr. Bob Cryer (Bradford, South)

I declare a financial interest. I am a Member of the Common Market Assembly. Anyone who reads the "Members' Register of Interests" will learn that my parliamentary salary is divided between the Labour movements in Sheffield and Bradford. I mention that because when I last spoke of these matters the hon. Member for Darlington (Mr. Fallon), who subsequently took the Queen's shilling, as they say, to count Members through the Government Lobby—it is not the most exacting task in Parliament, but the hon. Gentleman decided to take it on instead of remaining on the Back Benches and contributing to our debates from that position—suggested that I was spending a good deal of time junketing. That is not correct.

Junketing takes place in the Common Market, but I do not participate in it. I am not a member of any of the numerous delegations that travel round the world complete with interpreters, interpretation boxes, wissiers and the lot at enormous expense. I condemn it and I do not participate in it. Similarly, I do not participate in the political party groupings that cost £200,000, £300,000 or £400,000.

I am a member of the Common Market Assembly, but that does not mean that I shall stop talking about the Common Market. I shall not be stopped by those who say that I am prejudiced. My prejudice has been reinforced by membership of the Common Market Assembly. I believe that the Common Market is a mess and that it is getting messier.

Labour party policy on these matters was established by a two-thirds majority in 1981, which stated that we should withdraw on a political basis. That was clarified subsequently in a document entitled "Campaigning for a Fairer Britain", which maintained the right of withdrawal. That policy still stands. It is true that it is being reviewed, but the review has yet to be presented to conference for a two-thirds majority with a view to changing our policy.

The Bill commits us to expenditure to 1992 without any adequate right of veto by Parliament. Incidentally, it involves retrospective legislation for the convenience of the Common Market. I can remember when a measure was introduced that contained retrospective legislation for the Clay Cross councillors. We wished to give them the right to undertake civic duties and the then Labour Government produced the Housing Finance (Special Provisions) Act. The Tory view was that retrospective legislation was at the top of the slippery slope towards Fascism. They have demonstrated that they have significant double standards. Retrospection was not appropriate for 11 ordinary workers who had had the effrontery to keep down rents for council houses and provide decent standards of repair, but it is all right for the Common Market to lash out billions of pounds on the storage and distribution, or destruction, of food. That is the double standard that the Government are perpetuating in the Bill.

The only success that Delors has enjoyed in the Common Market is the diverting of attention from the Common Market's failures. The intergovernmental agreement—when dealing with it, the Minister did not talk about 1990, 1991 and 1992—will increase expenditure on agriculture, which is compulsory under the treaty of Rome. There are those who say that the social fund increases will provide significant benefits, but that is the non-compulsory section of expenditure. If there are any expenditure adjustments, they are always in favour of agriculture and always against the social fund and other similar areas of expenditure which we on the Opposition Benches would support.

It is claimed that there has been a reduction of food surpluses, but I remind the House of what is being undertaken. Food surpluses will be destroyed. They are currently valued at £7.7 billion. The cost of that destruction, or distribution, will be £2.45 billion, with £630 million spent immediately and an annual expenditure of £980 million for each year until 1991, in order to subsidise the food which is being sold off outside the EEC and which United Kingdom citizens have little chance of obtaining.

The European Court of Auditors, an EEC institution, had this to say about the checking of food stocks in its own press release on its recent audit: The report shows that the safeguards for the Community's interests in the value of stocks are in practice inadequate. Only three Member States … make any serious attempt at full annual stocktaking and only for certain products. The Court's inspection visits produced some alarming results. The press release concludes:

In these circumstances the Court concludes that it is technically impossible to arrive at any audit opinion whatever on the view presented by the EAGGF budget accounts of public storage expenditure. Money from this Bill will be spent on disposing of stocks that the EEC says are not being accounted for and about which no account can be given to the EEC. The House is being asked to hand over hundreds of millions of pounds to an organisation that cannot and does not, according to its own audit body, check the amount of food that it has in stock.

Use will also be made of that money to create a united states of Europe. I have with me the Strasbourg Notebook for Wednesday 26 October—the midday edition. It states: The Single Act and European Union. European Democratic Group Leader Christopher Prout (Shropshire and Stafford), speaking for his British colleagues, underlined his commitment to a strong and united Europe which, he said, had never been as important as now.

Sir Ian Lloyd

Hear, hear.

Mr. Cryer

I hear that there is some support for that view from the hon. Member for Havant (Sir I. Lloyd). The Prime Minister will be going through the green Government Benches as well as weeding out some of the federalists inside the Common Market. She has quite a task ahead of her.

I take it that, when Christopher Prout refers to Europe, he does so with the usual arrogance of those who talk about the Common Market, and who ignore 22 or 23 European states and assume that only 12 have the right to the title of "Europe". What outrageous effrontery that is to the rest of the continent.

Mr. Alex Carlile

What misrepresentation that is.

Mr. Cryer

The hon. and learned Member says that I am guilty of a misrepresentation. Europe is a continent, not a collection of 12 states with a trading relationship.

The other document that I wish to bring to the attention of the House is the Graziani report, which is being presented to the European Parliament this week and will be voted for overwhelmingly.

Mr. Dykes

He must be an Italian.

Mr. Cryer

The hon. Member for Harrow, East (Mr. Dykes) comments that Mr. Graziani is Italian. Earlier, the hon. Member said something that was completely untrue, in a false attempt to present critics of the Common Market as being little Englanders and against foreigners. The hon. Gentleman said that the debate had been peppered with criticisms of foreigners. That is not true. Neither Front Bench has referred to foreigners in derogatory terms; they have not even used the word "foreigners". In his blind obsession with the Common Market, the hon. Member for Harrow, East attempts to put words into right hon. and hon. Members' mouths. He can read the report of our debate to find out that that is so.

The Graziani report, which is being debated this week, and which will be passed overwhelmingly, notes that, even if the full potential of the Single Act is exploited to the maximum, it falls short of the Community's requirements, particularly as regards: —the competences of the Community, which is still deprived of adequate means of action in the areas of the common foreign policy, security, a common currency with a central bank, energy, development aid, cultural cooperation, education and European citizenship, —efficient decision-making where the Commission does still not enjoy appropriate executive power and the Council still remains subject to the unanimity rule in areas that are vital to the Community, —democracy, since the competences which are being transferred to the Community by the national Parliaments are not subject to adequate powers on the part of the European Parliament. The report concludes, in paragraph 20:

Believes that Parliament will have to prepare a new draft proposal for European Union before the 1992 deadline and that it will be for the Parliament elected in 1989 to accomplish this task. The House should be under no illusion that some of the money will be used for the development of European union, whereas sovereign states meeting together do so far more effectively than if they are compulsorily harmonized on every issue. [Interruption.] I am trying to finish, and I may point out to the Whips, who seem to be twirling their fingers round their wristwatch dials, that I keep being interrupted by the Euro-fanatics, who try to misrepresent the position taken by people such as myself who criticise the Common Market.

The Bill will throw good money after bad, and I shall vote against it. I shall be voting not just for the amendment but against the Bill itself.

Mr. Alex Carlile

How surprising of the hon. Gentleman!

Mr. Cryer

The hon. and learned Member may like to bear in mind that in Bradford the Tories are putting 9,000 people on the dole because they do not have enough money—that is what they claim.

I say that there are higher priorities on which to spend the £7.4 billion that the Government have spent on the Common Market since 1984, in providing decent social services, a decent livelihood for pensioners and single parent families, adequate housing, and other adequate facilities in Bradford and the rest of the country. If the hon. and learned Member for Montgomery, who has paid lickspittle subservience to the Common Market, listened more carefully, he would realise that people in all parts of the country are suffering under the Tory Government, whose supporters will be going into the Lobby tonight to vote for this Bill.

Mr. Carlile

Will the hon. Member for Bradford, South accept from me, as the Member representing a large rural constituency, that the workers there, who include members of trade unions—which I thought the hon. Member supported—have benefited enormously from our membership of the European Community? We would not have a farming industry left in Mid Wales, in the hills, were it not for the Community.

Mr. Cryer

If one is to define the benefits, the hon. and learned Member must explain how it is that we have a trade deficit of £10 billion and why we have paid £7.4 billion into the Common Market since 1984. He will have to explain also why we are pouring out money under this legislation that could go instead to benefit rural communities and industrial manufacturing in this country.

Those who support the Common Market have yet to produce a shred of evidence to back their arguments. It is a terrible organisation. It has lost us millions of jobs, and I shall vote against it tonight.

8.18 pm

Mr. Stuart Holland (Vauxhall)

This debate has apparently been divided between Europhobes and Europhiles, but my hon. Friend the Member for Bradford, South (Mr. Cryer) pointed out, in my view quite rightly, that the term "Europe" is too liberally or freely applied to matters that are more strictly concerned with the Community rather than being genuinely European.

This week the House has had plenty of opportunity to address the issues that are the subject of the Bill, and I for one do not seek to detain the House by reiterating some of the arguments adduced from the Dispatch Box earlier. Instead, I shall focus on two or three points.

One must ask what is the nature of the Government's policy in relation to the Bruges speech. Frankly, the Prime Minister's position, at least in one respect, is consistent and logical. She can ideologically support the case for the creation of a genuine free trade area inside the European Community. This is what the single market proposals are all about. My hon. Friend the Member for Motherwell, North (Dr. Reid) pointed out that she may have more difficulty with the declaration of the intention of member countries to proceed with political co-operation with a view to economic union. But in the other respect the Prime Minister may be able to claim that she is being consistent—she believes in a level playing field for the competitive process here at home and abroad.

What does that mean? It is consistent with the Prime Minister's attitude towards intervention, where she believes that the role of the state should be negative—to prevent frictions to the market mechanism by Government policies. In the Community, she believes in negative integration. She believes in breaking down what is already there rather than positive co-operation to build up what is not there. These are the reasons why she has no readiness to co-operate with other Governments on industrial, regional and social policies.

However, there is a contradiction. If 1992 is only about levelling the playing field, big firms will win over the small and medium firms that the Government and the Prime Minister seek to defend. Certainly strong regions will dominate weaker regions, the rich will get richer and the poor will get poorer. It may be a common market, but it certainly will not be a community.

These are the differences between the approach of the Government and the Prime Minister and our approach, because we want to put community into the common market. We want to see joint social, industrial and regional policies adopted in the Community, not on the federalist basis, not as a denial of nation states or national Governments, but as the extension of joint co-operative policies whereby Governments can do together what they cannot best do for themselves and can do by themselves what they can best do alone.

These are the differences between the Government and the Opposition on the Community and what it should do until 1992. The Government are negative in their philosophy on the internal market. They favour a breaking down of what impedes trade rather than being positive about intergovernmental joint action to recover spending and trade. The Government are negative towards the social market proposals not only made by Jacques Delors but backed by other Governments in the Community. They alone in the Community believe that one can strengthen competitiveness by weakening labour and its institutions, and that one can gain by confronting rather than working with the trades unions.

Sir Ian Lloyd

This is most important. The hon. Gentleman has said that a future Labour Government would favour co-operation on this basis and that they would favour co-operation based entirely on supervision by national Governments and national Parliaments. Is he aware—I am sure he must be—of the research document produced by the European Parliament analysing the position of some 60 of the 76 political parties in Europe? It is clear that those 60 parties collectively are insisting that the democratic deficits in Europe can be solved only by adding to the powers of the European Parliament. Does the Labour party agree with that?

Mr. Holland

I do not need lectures from the hon. Gentleman on what parties in Europe are doing on this matter. We are in constant dialogue and I have represented my party in that dialogue with, for example, the Confederation of Socialist Parties of the European Community, which is by far the largest single federation. That grouping of parties outweighs the sister parties of the Tories and causes some embarrassment to the Liberals, who do not know whether they are sitting left, right or centre when they join Liberals abroad.

We need to ensure that there is effective accountability over what the Community does, but that does not mean that the European Assembly should be a Parliament with powers above national Parliaments. Many members of the European Parliament may want that, but it does not mean that they should have it. Nor does it mean that there is no role for the European Assembly in assessing what the Community is doing, nor even proposing what the Community should do.

But such proposals, which at the moment can be made only on a limited basis to the Council of Ministers, and its power to amend Community legislation, do not of themselves mean a supranational assembly over national Governments. That is one of the reasons why we need more co-operation between what the Assembly of the Community is doing and what national Governments are doing. It is one of the reasons why we tabled our amendment on Monday, which suggested that the House should have the power of scrutiny, and our amendments this evening and in the debate on 11 July proposing that there should be more co-operation on that basis.

The Government are negative in their attitude towards the social market and industrial and regional policies. They do not want joint ventures with other Governments in Europe. Nor do they have a positive policy of industrial co-operation between British and other companies. They leave that entirely to the market, despite the fact that the Japanese, for example, are making joint ventures with everybody under their rising sun. The Government refuse Community offers for a framework of joint ventures within Europe, as they did the proposal made last year for a networking of regional enterprise agencies and local and regional governments in the Community.

The Prime Minister probably likes the Gaullist comparison made by commentators and cartoonists following her Bruges speech, but her policies are not Gaullist and nor is she Charles de Gaulle. Charles de Gaulle was aganst federalism, but he was strongly in favour of international joint action by Community Governments. I give two illustrations of that. First, in 1967, the Gaullist Government proposed joint ventures between European companies to strengthen Europe's industrial base. That was a positive policy made on the supply side of the European Community that is not matched by anything coming from the Government.

Secondly, on the demand management side, de Gaulle supported the medium-term economic policy committee of the Community, which was chaired by Robert Marjolin, then the vice-president of the Commission, a former head of the OEEC, and a former deputy head of the French plan. They gave their active support to this policy so that Europe could project its mutual spending and trade and have some coherence in its economic policy. The Government are doing nothing of that kind. They are not proposing that Governments at the European level should take joint action on spending and trade, despite the severe risks that could be faced following the forthcoming election in the United States of a slowdown in the world economy if the United States budget deficit is cut and United States imports are cut.

Further, on international policy, de Gaulle wanted and worked for real European co-operation from the Atlantic to the Urals, not half-hearted, small-minded co-operation on harmonising a free trade area while retaining one foot in Europe and the other in Washington. He was opposed to such a stance, castigating it as the Trojan horse approach to Europe. In that respect, again, the Prime Minister is not Gaullist. De Gaulle had a vision of Europe, but the Prime Minister has not. He had international stature of a kind that, precisely because she has no vision for Europe, the Prime Minister has not.

It is this failure to work within a non-federal framework for European co-operation that has meant that the real political leadership in Europe has passed from the Prime Minister. It is not Charles de Gaulle but another Frenchman who has proved more prescient about the leadership of the British nation, 150 years after his death. The Prime Minister is the daughter of a shopkeeper, with the attitudes of a shopkeeper, anxious to project a nation of shopkeepers in her own image. It is a stunted image for a stunted European policy. It does no credit to the Government, nor to this House, nor to the British people.

8·30 pm

Mr. Brooke

As I remarked earlier in the debates on this Bill, I am approaching my third anniversary as the relevant Minister. I am approaching my 17th Budget Council, and it is my experience that the Budget Council shares with these debates the fact that they are conducted by a small number of people with whom one becomes very friendly and familiar.

The right hon. and learned Member for Montgomery (Mr. Carlie) is a newcomer to our debates, so I hope that I am not committing a Euro-offence in describing my familiarity with the dramatis personae in both places. I welcome him and, in the characteristic and familiar words that one uses about maiden speeches, we look forward to his future contributions. However, in his description of the flexibility of the Labour vision, he was rejecting the view that imitation is the sincerest form of flattery. The description that he gave of a speech which could be used in by-elections up and down the country seemed to be in line with standard Liberal practice.

My hon. Friend the Member for Southend, East (Mr. Taylor) intervened in my earlier speech, and I said that I would come back if I had anything further to add on agriculture. The crucial point is that, according to the legally binding decision on budget discipline, the agricultural guideline limit must be respected. On the one hand, that decision requires the Commission to make its price proposals consistent with the guideline. On the other hand, the Commission must monitor spending to ensure that it is kept within the guideline and must use the stabilisers about which my hon. Friend asked me, where necessary, to achieve that aim. Although the operation of stabilisers is independent of the Commission's proposals for changes in prices or in the agri-monetary system in the annual price fixing, the overall aim of keeping spending within the guideline is assured by the budget discipline decision, which was agreed by the February European Council.

Mr. Teddy Taylor

My right hon. Friend has been most kind and courteous, but my question did not concern the most helpful information that he has just given. I was simply asking whether the automatic stabiliser could be overcome by an increase in price at the same time as an alteration of the green pound, as happened this year. Is there not a danger that, like all wonderful Euro-plans and dreams, it will, in fact, be undermined and there will be no lawful method of stopping it in any way?

Mr. Brooke

My hon. Friend's advice to us is so consistent that I am quite certain that we shall mount vigilance against the line that he has suggested. I was seeking to suggest that the stabilisers cannot be used in that way because that would take us outside the overall policy.

The hon. Member for Hamilton (Mr. Robertson) went on a bit. I apologise for the fact that, in seeking to abbreviate my speech, I omitted three or four words from the Prime Minister's speech. I acknowledge that those words were uttered. I am delighted that he has produced the equivalent of a manuscript amendment, because it unquestionably strengthens the thought that underlies the Prime Minister's observation.

I appreciate that the hon. Member for Hamilton is the spokesman for foreign affairs on the Labour Front Bench, but he has never really understood the technicalities of this legislation. The negative reserve is something that he never mastered. I am glad to say that we have corralled and curtailed it. Tonight, he went on and on about £738 million. I say encouragingly to him, because it demonstrated a certain distance from the detail, that the figure is in fact £620 million, as there is, of course, a substantial amount that was earmarked for the monetary reserve.

To be fair, the hon. Gentleman did acknowledge that, because our net receipts would be going up by £300 million, a lot of that money will he coming back to us. However, where he took off was in introducing £200 million as the amount that we were likely to get back from the structural funds annually in the future. If I may say so, his hon. Friend the Member for Motherwell, North (Dr. Reid) was simultaneously quoting an article in The Guardian which said that the British Government would have to find £6 billion over the next four years in extra expenditure in exactly the same areas of endeavour.

The difference between the £200 million of the hon. Member for Hamilton and the £6 billion of the hon. Member for Motherwell, North is considerable. It is true that they are different sums and the distance between them shows an error in both directions. The hon. Member for Hamilton always strays a little from the detail, and he suggested that 80 per cent. of the structural funds had to go into objective 1 regions. However, it was in fact 80 per cent. of the regional funds which had to go into objective 1 regions. If he had read the speech of his hon. Friend the Member for Gateshead, East (Ms. Quin) and her exchange with me on Second Reading, he would have seen that there is a substantial emphasis in the Social Fund on youth training and the long-term unemployed in both areas, for which the United Kingdom will continue to receive substantial resources.

The hon. Member for Hamilton also raised the question of structural funds receipts. It is not true that such receipts simply finance projects that would have taken place anyway. Ministers take account of their respective level of receipts when reaching their expenditure decisions each year. The receipts enable spending programmes to be set at a higher level than otherwise would be possible.

The hon. Member for Hamilton then quoted from a clause in the preamble to the Single European Act and talked about the Stuttgart declaration on European union. We discussed this on Monday, when I made it clear that neither the Single European Act nor the treaty of Rome imposes an obligation upon the Community to introduce European monetary union. Under article 102A of the treaty, any institutional changes in economic and monetary policy require the calling of an intergovernmental conference, the unanimous agreement of all member states and approval by national Parliaments. My hon. Friend the Member for Harrow, East (Mr. Dykes) congratulated the Government on the Bill and my right hon. Friend the Prime Minister on her Bruges speech. He introduced—possibly unconsiously—a transfer from reds under the bed to feds under the bed.

The hon. Member for Newham, South (Mr. Spearing) is an old friend in these debates. I do not share all his views, but I was wounded by the scathing comment by the hon. and learned Member for Montgomery about the hon. Gentleman's contribution to the debate. The hon. Gentleman's chairmanship of the Scrutiny Committee means that he must make very informed speeches in these debates. I think we are all grateful to him for the quotation from Mr. Delors's speech on 6 July, which otherwise has some danger of passing into legend, as have other remarks like "Tory vermin" and "Exporting is fun", none of which was actually uttered by the people to whom they were attributed.

The hon. Member for Newham, South asked about the balance of trade. Whether or not our balance of trade in manufacturing will worsen depends on how British industry reponds. There is no predetermined conclusion on that. The year 1992 represents both an opportunity and a challenge, and the Government's approach is that industry and services should be aware of that oportunity and challenge so that they can approach 1992 with readiness and confidence. The experience of improving competition and sweeping away red tape in the United Kingdom has been immensely beneficial and we trust that opening up the internal market throughout Europe will have a similar beneficial effect.

Mr. Spearing

rose—

Mr. Brooke

I was asked to be brisk.

My hon. Friend the Member for Stafford (Mr. Cash), who was shut out of the debate on Monday by the informal deadline, gave an immensely worthwhile exposure of the Opposition's position. The hon. Member for Hamilton asked my hon. Friend why he was dwelling on it, but it was simply because that was the main arena in which the hon. Member for Hamilton had deployed himself.

My hon. Friend the Member for Gainsborough and Horncastle (Mr. Leigh)—[Interruption]

Mr. Spearing

Will the right hon Gentleman give way?

Mr. Brooke

I will not give way, because I understand that there is a general pressure that we should bring these matters to a conclusion.

Mr. Spearing

On a point of order, Mr. Deputy Speaker. Can you indicate to the House the time at which this debate must finish unless the Government move a motion to suspend the rule?

Mr. Deputy Speaker (Sir Paul Dean)

The right hon. Gentleman is correct in what he says.

Mr. Brooke

Provided I am not going to be rebuked by the Opposition Whip. I shall give way to the hon. Gentleman.

Mr. Spearing

I am grateful to the right hon. Gentleman for his courtesy. He was very courteous to me a moment ago. I am wondering whether, in using the scrutiny function of questions in speeches to which he referred, he could answer two questions. The right hon. Gentleman referred to the Stuttgart declaration, signed by this Government, as being in favour of and being committed to European Union—with a capital "E" and a capital "U". Will he confirm that there is a Government commitment to that, whatever it may be?

Secondly, in his kindly reference to my quotation from Mr. Delors, will he acknowledge that at the moment more than 80 per cent. of law that is applicable to the people and citizens of the United Kingdom in the courts of this country originated in Brussels 10 years before Mr. Delors's forecast?

Mr. Brooke

Of course I give the acknowledgement in connection with the declaration. As I said on Monday, there has been a series of political declarations about political union by both parties over the years. The hon. Gentleman's calculation about the balance between European and British legislation seems to me to be determined by the amount of paper on which the legislation is written, and I am not quite sure that that is the way in which one should establish the balance.

Mr. Spearing

How else?

Mr. Brooke

The hon. Member for Motherwell, North again mentioned the treatment of grants from the structural funds. As I implied in terms of my reference to The Guardian, he should not believe everything that he reads in the newspapers. He suggested that, until now, we have not paid our share of the cost of structural projects financed by Community aid. That is not so. Projects simply cannot go ahead unless member states provide their share of the money. I shall not do an analysis of the £6 billion that he mentioned. For the reason that the hon. Member for Hamilton gave, it seems an exaggerated figure.

My hon. Friend the Member for Holland with Boston (Sir R. Body), who is a veteran of these debates, emphasised the continuity of the dialogue. The title of his constituency serves as a bridge between continental Europe and the United States.

The hon. Member for Bradford, South (Mr. Cryer)—I hope I am not doing him a disservice by saying that one of my great disappointments of this year was not to play cricket under his captaincy—like all great slow left-arm Yorkshire bowlers, bowls with a nagging length. In these debates he bowls with a nagging length only if provoked. I found him admirably brief and pertinent. Despite his disclaimer about his membership of what he described as "the assembly", the House gains from the dual mandate that he represents.

I have to protest about what the hon. Gentleman said late on Monday night about Euro-fanatics among Treasury officials. Treasury officials give very objective advice to Ministers. He referred to the Court of Auditors' report on public storage. I share his concern about financial irregularities and fraud against the Community budget. The Government of the United Kingdom have been at the forefront of attempts in the Council, and elsewhere, to tackle the problem of fraud and to improve financial management. Recently I had useful discussions in London with the head of the Commission's new anti-fraud unit.

The hon. Member for Vauxhall (Mr. Holland) drew on the Prime Minister's Bruges speech, which provided the pabulum for many Opposition Members' speeches. He referred to the structural funds. In view of what has been done in regard to the structural funds, I am bound to say that there is no pleasing some people. He said that the Prime Minister is not de Gaulle, which is self-evident, just as those who have made the pilgrimage to Colombey-les-deux-Églises know that there is only one church there.

The British people warmly approve of the Prime Minister's stand and position on Europe. She may be the daughter of a shopkeeper, but she is also the daughter of an alderman—that most Saxon of governing titles—and she speaks for the spirit of England. The office of Paymaster General goes back to being Treasurer of the Navy under Henry VIII, but its climax came when Lord North conducted an investigation in the 1780s which showed that, rather like the fraud investigation of the hon. Member for Bradford, South, there was £500,000 missing in 1780s sterling. The following year, the great Burke—appointed Mr. Clean—took through an Act which said that the penalty for forging the Paymaster General's signature should be death without benefit of clergy.

I am delighted, in my present role, to have responsibility for saving and constraint in the European budget. The negotiations that have given rise to the Bill were a remarkable negotiating achievement by my right hon. Friends, and they were conducted in the interests of Europe as a whole. I am merely a journeyman in the task of helping to put this historic legislation on the statute book, and I have no hesitation in commending the Third Reading of the Bill to the House.

Question put, That the amendment be made:—

The House divided: Ayes 79, Noes 252.

Division No. 459]	[8.44 pm
AYES
Anderson, Donald	Lamond, James
Armstrong, Hilary	Lestor, Joan (Eccles)
Banks, Tony (Newham NW)	Lloyd, Tony (Stretford)
Barnes, Harry (Derbyshire NE)	Loyden, Eddie
Battle, John	McAvoy, Thomas
Bennett, A. F. (D'nt'n & R'dish)	Macdonald, Calum A.
Bermingham, Gerald	McWilliam, John
Bidwell, Sydney	Madden, Max
Boyes, Roland	Mahon, Mrs Alice
Bray, Dr Jeremy	Marshall, Jim (Leicester S)
Brown, Gordon (D'mline E)	Molyneaux, Rt Hon James
Buckley, George J.	Morgan, Rhodri
Budgen, Nicholas	Morley, Elliott
Campbell-Savours, D. N.	Mullin, Chris
Clay, Bob	Murphy, Paul
Clwyd, Mrs Ann	Nellist, Dave
Cohen, Harry	Pike, Peter L.
Coleman, Donald	Powell, Ray (Ogmore)
Cook, Robin (Livingston)	Primarolo, Dawn
Cryer, Bob	Randall, Stuart
Darling, Alistair	Redmond, Martin
Dixon, Don	Rees, Rt Hon Merlyn
Eadie, Alexander	Reid, Dr John
Fields, Terry (L'pool B G'n)	Robertson, George
Fisher, Mark	Shepherd, Richard (Aldridge)
Flynn, Paul	Short, Clare
Foster, Derek	Skinner, Dennis
Foulkes, George	Smith, Andrew (Oxford E)
George, Bruce	Smith, C. (Isl'ton & F'bury)
Golding, Mrs Llin	Snape, Peter
Grant, Bernie (Tottenham)	Soley, Clive
Haynes, Frank	Spearing, Nigel
Holland, Stuart	Turner, Dennis
Hood, Jimmy	Walker, A. Cecil (Belfast N)
Hoyle, Doug	Wall, Pat
Illsley, Eric	Walley, Joan
Jones, Martyn (Clwyd S W)	Wardell, Gareth (Gower)
Kaufman, Rt Hon Gerald	Wareing, Robert N.

Winnick, David	Tellers for the Ayes:
Wise, Mrs Audrey	Mr. Allen McKay and
Worthington, Tony	Mr. Alun Michael.

NOES
Adley, Robert	Ewing, Mrs Margaret (Moray)
Alexander, Richard	Fallon, Michael
Alison, Rt Hon Michael	Fenner, Dame Peggy
Allason, Rupert	Field, Barry (Isle of Wight)
Alton, David	Fishburn, John Dudley
Amess, David	Fookes, Miss Janet
Amos, Alan	Forman, Nigel
Arbuthnot, James	Forsyth, Michael (Stirling)
Arnold, Jacques (Gravesham)	Forth, Eric
Arnold, Tom (Hazel Grove)	Fox, Sir Marcus
Ashby, David	Franks, Cecil
Aspinwall, Jack	Freeman, Roger
Atkinson, David	French, Douglas
Baker, Nicholas (Dorset N)	Gale, Roger
Baldry, Tony	Gardiner, George
Banks, Robert (Harrogate)	Gilmour, Rt Hon Sir Ian
Barnes, Mrs Rosie (Greenwich)	Glyn, Dr Alan
Bellingham, Henry	Goodlad, Alastair
Bennett, Nicholas (Pembroke)	Gorman, Mrs Teresa
Bevan, David Gilroy	Gorst, John
Blackburn, Dr John G.	Gow, Ian
Blaker, Rt Hon Sir Peter	Gower, Sir Raymond
Bonsor, Sir Nicholas	Greenway, Harry (Ealing N)
Boscawen, Hon Robert	Greenway, John (Ryedale)
Boswell, Tim	Gregory, Conal
Bottomley, Peter	Griffiths, Peter (Portsmouth N)
Bottomley, Mrs Virginia	Grist, Ian
Bowden, Gerald (Dulwich)	Ground, Patrick
Bowis, John	Grylls, Michael
Boyson, Rt Hon Dr Sir Rhodes	Gummer, Rt Hon John Selwyn
Braine, Rt Hon Sir Bernard	Hamilton, Hon Archie (Epsom)
Brandon-Bravo, Martin	Hampson, Dr Keith
Brazier, Julian	Hargreaves, A. (B'ham H'll Gr')
Bright, Graham	Hargreaves, Ken (Hyndburn)
Brittan, Rt Hon Leon	Harris, David
Brooke, Rt Hon Peter	Haselhurst, Alan
Brown, Michael (Brigg & Cl't's)	Hawkins, Christopher
Browne, John (Winchester)	Hayes, Jerry
Bruce, Ian (Dorset South)	Hayhoe, Rt Hon Sir Barney
Buck, Sir Antony	Hayward, Robert
Burns, Simon	Heathcoat-Amory, David
Burt, Alistair	Hill, James
Butcher, John	Hind, Kenneth
Butler, Chris	Hordern, Sir Peter
Butterfill, John	Howard, Michael
Campbell, Menzies (Fife NE)	Howell, Ralph (North Norfolk)
Carlile, Alex (Mont'g)	Howells, Geraint
Carlisle, Kenneth (Lincoln)	Hughes, Robert G. (Harrow W)
Carrington, Matthew	Hunt, David (Wirral W)
Carttiss, Michael	Hunt, John (Ravensbourne)
Cash, William	Hunter, Andrew
Chalker, Rt Hon Mrs Lynda	Irvine, Michael
Chapman, Sydney	Jack, Michael
Clark, Dr Michael (Rochford)	Janman, Tim
Clark, Sir W. (Croydon S)	Johnson Smith, Sir Geoffrey
Colvin, Michael	Jones, Gwilym (Cardiff N)
Conway, Derek	Jones, Robert B (Herts W)
Coombs, Anthony (Wyre F'rest)	Kellett-Bowman, Dame Elaine
Cran, James	King, Roger (B'ham N'thfield)
Critchley, Julian	Kirkhope, Timothy
Currie, Mrs Edwina	Kirkwood, Archy
Davies, Q. (Stamf'd & Spald'g)	Knapman, Roger
Davis, David (Boothferry)	Knight, Greg (Derby North)
Day, Stephen	Knight, Dame Jill (Edgbaston)
Devlin, Tim	Knowles, Michael
Dickens, Geoffrey	Lamont, Rt Hon Norman
Dorrell, Stephen	Lang, Ian
Dunn, Bob	Leigh, Edward (Gainsbor'gh)
Durant, Tony	Lennox-Boyd, Hon Mark
Dykes, Hugh	Lightbown, David
Eggar, Tim	Lilley, Peter
Emery, Sir Peter	Lloyd, Sir Ian (Havant)
Evans, David (Welwyn Hatf'd)	Lloyd, Peter (Fareham)
Evennett, David	Lord, Michael

McCrindle, Robert	Ryder, Richard
Macfarlane, Sir Neil	Sackville, Hon Tom
MacKay, Andrew (E Berkshire)	Sayeed, Jonathan
McLoughlin, Patrick	Shaw, David (Dover)
McNair-Wilson, Sir Michael	Shaw, Sir Giles (Pudsey)
McNair-Wilson, P. (New Forest)	Shaw, Sir Michael (Scarb')
Major, Rt Hon John	Shephard, Mrs G. (Norfolk SW)
Malins, Humfrey	Shepherd, Colin (Hereford)
Mans, Keith	Shersby, Michael
Maples, John	Smith, Sir Dudley (Warwick)
Marland, Paul	Speed, Keith
Marshall, Michael (Arundel)	Spicer, Sir Jim (Dorset W)
Martin, David (Portsmouth S)	Spicer, Michael (S Worcs)
Mawhinney, Dr Brian	Squire, Robin
Maxwell-Hyslop, Robin	Stanbrook, Ivor
Mellor, David	Steen, Anthony
Miscampbell, Norman	Stern, Michael
Mitchell, Andrew (Gedling)	Stewart, Andy (Sherwood)
Monro, Sir Hector	Stewart, Ian (Hertfordshire N)
Moore, Rt Hon John	Stradling Thomas, Sir John
Morris, M (N'hampton S)	Summerson, Hugo
Morrison, Sir Charles	Taylor, John M (Solihull)
Moss, Malcolm	Thompson, D. (Calder Valley)
Moynihan, Hon Colin	Thompson, Patrick (Norwich N)
Neale, Gerrard	Thorne, Neil
Needham, Richard	Thurnham, Peter
Nelson, Anthony	Townsend, Cyril D. (B'heath)
Neubert, Michael	Tracey, Richard
Nicholls, Patrick	Trippier, David
Nicholson, David (Taunton)	Twinn, Dr Ian
Nicholson, Emma (Devon West)	Vaughan, Sir Gerard
Owen, Rt Hon Dr David	Viggers, Peter
Page, Richard	Waddington, Rt Hon David
Patnick, Irvine	Wakeham, Rt Hon John
Patten, Chris (Bath)	Waldegrave, Hon William
Patten, John (Oxford W)	Walden, George
Pawsey, James	Waller, Gary
Peacock, Mrs Elizabeth	Walters, Sir Dennis
Porter, David (Waveney)	Ward, John
Powell, William (Corby)	Wardle, Charles (Bexhill)
Price, Sir David	Warren, Kenneth
Raison, Rt Hon Timothy	Wheeler, John
Rathbone, Tim	Whitney, Ray
Redwood, John	Widdecombe, Ann
Renton, Tim	Wiggin, Jerry
Rhodes James, Robert	Wilkinson, John
Ridley, Rt Hon Nicholas	Wilshire, David
Ridsdale, Sir Julian	Wood, Timothy
Rifkind, Rt Hon Malcolm	Yeo, Tim
Roberts, Wyn (Conwy)	Young, Sir George (Acton)
Roe, Mrs Marion
Rossi, Sir Hugh	Tellers for the Noes:
Rost, Peter	Mr. Alan Howarth and
Rumbold, Mrs Angela	Mr. David Maclean.

Question accordingly negatived.

Main Question put:—

The House divided: Ayes 247, Noes 34.

Division No. 460]	[8.57 pm
AYES
Adley, Robert	Bevan, David Gilroy
Alexander, Richard	Blaker, Rt Hon Sir Peter
Alison, Rt Hon Michael	Bonsor, Sir Nicholas
Allason, Rupert	Boscawen, Hon Robert
Alton, David	Boswell, Tim
Amess, David	Bottomley, Peter
Amos, Alan	Bottomley, Mrs Virginia
Arbuthnot, James	Bowden, Gerald (Dulwich)
Arnold, Jacques (Gravesham)	Bowis, John
Ashby, David	Boyson, Rt Hon Dr Sir Rhodes
Aspinwall, Jack	Braine, Rt Hon Sir Bernard
Atkinson, David	Brandon-Bravo, Martin
Baker, Nicholas (Dorset N)	Brazier, Julian
Baldry, Tony	Bright, Graham
Banks, Robert (Harrogate)	Brittan, Rt Hon Leon
Barnes, Mrs Rosie (Greenwich)	Brooke, Rt Hon Peter
Bellingham, Henry	Brown, Michael (Brigg & Cl't's)
Bennett, Nicholas (Pembroke)	Browne, John (Winchester)

Bruce, Ian (Dorset South)	Howells, Geraint
Buck, Sir Antony	Hughes, Robert G. (Harrow W)
Burns, Simon	Hunt, David (Wirral W)
Burt, Alistair	Hunt, John (Ravensbourne)
Butcher, John	Hunter, Andrew
Butler, Chris	Irvine, Michael
Butterfill, John	Jack, Michael
Campbell, Menzies (Fife NE)	Johnson Smith, Sir Geoffrey
Carlile, Alex (Mont'g)	Jones, Gwilym (Cardiff N)
Carlisle, Kenneth (Lincoln)	Jones, Robert B (Herts W)
Carrington, Matthew	Kellett-Bowman, Dame Elaine
Carttiss, Michael	King, Roger (B'ham N'thfield)
Cash, William	Kirkhope, Timothy
Chalker, Rt Hon Mrs Lynda	Kirkwood, Archy
Chapman, Sydney	Knapman, Roger
Clark, Dr Michael (Rochford)	Knight, Greg (Derby North)
Clark, Sir W. (Croydon S)	Knight, Dame Jill (Edgbaston)
Colvin, Michael	Knowles, Michael
Conway, Derek	Lamont, Rt Hon Norman
Coombs, Anthony (Wyre F'rest)	Lang, Ian
Cran, James	Leigh, Edward (Gainsbor'gh)
Critchley, Julian	Lennox-Boyd, Hon Mark
Currie, Mrs Edwina	Lightbown, David
Davies, Q. (Stamf'd & Spald'g)	Lilley, Peter
Davis, David (Boothferry)	Lloyd, Sir Ian (Havant)
Day, Stephen	Lloyd, Peter (Fareham)
Devlin, Tim	Lord, Michael
Dickens, Geoffrey	McCrindle, Robert
Dorrell, Stephen	Macfarlane, Sir Neil
Dunn, Bob	MacKay, Andrew (E Berkshire)
Durant, Tony	McLoughlin, Patrick
Dykes, Hugh	McNair-Wilson, Sir Michael
Eggar, Tim	McNair-Wilson, P. (New Forest)
Emery, Sir Peter	Major, Rt Hon John
Evans, David (Welwyn Hatf'd)	Malins, Humfrey
Evennett, David	Mans, Keith
Ewing, Mrs Margaret (Moray)	Maples, John
Fallon, Michael	Marland, Paul
Fenner, Dame Peggy	Marshall, Michael (Arundel)
Field, Barry (Isle of Wight)	Martin, David (Portsmouth S)
Fishburn, John Dudley	Mawhinney, Dr Brian
Fookes, Miss Janet	Maxwell-Hyslop, Robin
Forman, Nigel	Mellor, David
Forsyth, Michael (Stirling)	Miscampbell, Norman
Forth, Eric	Mitchell, Andrew (Gedling)
Fox, Sir Marcus	Monro, Sir Hector
Franks, Cecil	Moore, Rt Hon John
Freeman, Roger	Morris, M (N'hampton S)
French, Douglas	Morrison, Sir Charles
Gale, Roger	Moss, Malcolm
Gardiner, George	Moynihan, Hon Colin
Gilmour, Rt Hon Sir Ian	Neale, Gerrard
Glyn, Dr Alan	Needham, Richard
Goodlad, Alastair	Nelson, Anthony
Gorst, John	Neubert, Michael
Gow, Ian	Nicholls, Patrick
Gower, Sir Raymond	Nicholson, David (Taunton)
Greenway, Harry (Ealing N)	Nicholson, Emma (Devon West)
Greenway, John (Ryedale)	Owen, Rt Hon Dr David
Gregory, Conal	Page, Richard
Grist, Ian	Patnick, Irvine
Ground, Patrick	Patten, Chris (Bath)
Grylls, Michael	Patten, John (Oxford W)
Gummer, Rt Hon John Selwyn	Pawsey, James
Hamilton, Hon Archie (Epsom)	Peacock, Mrs Elizabeth
Hampson, Dr Keith	Porter, David (Waveney)
Hargreaves, A. (B'ham H'll Gr')	Powell, William (Corby)
Hargreaves, Ken (Hyndburn)	Price, Sir David
Harris, David	Raison, Rt Hon Timothy
Haselhurst, Alan	Rathbone, Tim
Hawkins, Christopher	Redwood, John
Hayes, Jerry	Renton, Tim
Hayhoe, Rt Hon Sir Barney	Rhodes James, Robert
Hayward, Robert	Ridley, Rt Hon Nicholas
Heathcoat-Amory, David	Ridsdale, Sir Julian
Hill, James	Rifkind, Rt Hon Malcolm
Hind, Kenneth	Roberts, Wyn (Conwy)
Hordern, Sir Peter	Roe, Mrs Marion
Howard, Michael	Rossi, Sir Hugh
Howell, Ralph (North Norfolk)	Rost, Peter

Rumbold, Mrs Angela	Tracey, Richard
Ryder, Richard	Trippier, David
Sackville, Hon Tom	Twinn, Dr Ian
Sayeed, Jonathan	Vaughan, Sir Gerard
Shaw, David (Dover)	Viggers, Peter
Shaw, Sir Giles (Pudsey)	Waddington, Rt Hon David
Shaw, Sir Michael (Scarb')	Wakeham, Rt Hon John
Shephard, Mrs G. (Norfolk SW)	Waldegrave, Hon William
Shepherd, Colin (Hereford)	Walden, George
Shersby, Michael	Waller, Gary
Smith, Sir Dudley (Warwick)	Walters, Sir Dennis
Speed, Keith	Ward, John
Spicer, Sir Jim (Dorset W)	Wardle, Charles (Bexhill)
Spicer, Michael (S Worcs)	Warren, Kenneth
Squire, Robin	Wheeler, John
Stanbrook, Ivor	Whitney, Ray
Steen, Anthony	Widdecombe, Ann
Stern, Michael	Wiggin, Jerry
Stewart, Andy (Sherwood)	Wilkinson, John
Stewart, Ian (Hertfordshire N)	Wilshire, David
Stradling Thomas, Sir John	Wood, Timothy
Summerson, Hugo	Yeo, Tim
Taylor, John M (Solihull)	Young, Sir George (Acton)
Thompson, D. (Calder Valley)
Thompson, Patrick (Norwich N)	Tellers for the Ayes:
Thorne, Neil	Mr. David Maclean and
Thurnham, Peter	Mr. Alan Howarth.
Townsend, Cyril D. (B'heath)

NOES
Banks, Tony (Newham NW)	Mullin, Chris
Bermingham, Gerald	Nellist, Dave
Biffen, Rt Hon John	Pike, Peter L.
Body, Sir Richard	Primarolo, Dawn
Buckley, George J.	Redmond, Martin
Budgen, Nicholas	Shepherd, Richard (Aldridge)
Clay, Bob	Skinner, Dennis
Cohen, Harry	Spearing, Nigel
Fields, Terry (L'pool B G'n)	Taylor, Teddy (S'end E)
Flynn, Paul	Walker, A. Cecil (Belfast N)
Gorman, Mrs Teresa	Walker, Bill (T'side North)
Janman, Tim	Wall, Pat
Lamond, James	Walley, Joan
Loyden, Eddie	Winterton, Mrs Ann
McAvoy, Thomas	Wise, Mrs Audrey
Madden, Max
Mahon, Mrs Alice	Tellers for the Noes:
Marlow, Tony	Mr. Bob Cryer and
Molyneaux, Rt Hon James	Mr. Harry Barnes.

Question agreed to.

Bill accordingly read the Third time, and passed.