§ Mr. George Robertson (Hamilton)
On a point of order, Mr. Speaker. The motion on the Order Paper begins:That this House takes note of the proposals described in the unnumbered Explanatory Memorandum".The middle of the motion refers to welcomingthe principle of Association Agreements between the European Community and the reforming democracies of Poland, Hungary and Czechoslovakiaand it concludes by saying that the Houselooks forward to early ratification of the Agreements".The House has been asked in this debate of a maximum of an hour and a half to consider the association agreements. They are substantial, lengthy documents, which are important to this House, the country and the European Community. The Foreign Office supplied six copies of the documents to the House for the use of hon. Members. I was able, late this evening, to obtain the final copy of those documents. It is not satisfactory for the House to consider such an important issue and to refer to documents at short notice when there are not sufficient copies of them for the hon. Members who need to refer to them, especially during the debate.
The unnumbered explanatory memorandum and the draft interim agreement on the association agreements should also be available, but they were made available from the Vote Office only at 4.30 pm last Thursday. The documents could not be released—not even the report of the Select Committee on European Legislation—until after the business statement had been made. Hon. Members are being asked to debate matters of crucial importance to our constituents on a Monday evening without having had the opportunity to get hold of the documents until late last Thursday evening.
The motion asks the House to look forwardto early ratification of the Agreements.Am I right in presuming that ratification happens automatically and that this hour-and-a-half debate will be our only opportunity to ratify those important agreements before they come into effect at the end of 1992?
§ Mr. Speaker
The Minister might like to answer those points. I take note of the hon. Member's remarks. The unnumbered explanatory memorandum, by long-standing practice, stands proxy for the House to consider such proposals in a fast-moving situation.
Of the other bulky documents, I understand that only six copies were available, so perhaps the Minister would like to explain.
§ The Minister of State, Foreign and Commonwealth Office (Mr. Tristan Garel-Jones)
Further to that point of order, Mr. Speaker. I hope that I can help the hon. Member for Hamilton (Mr. Robertson) and the House.
The association agreements, of course, require a separate ratification debate in the House under section 1(3) of the European Communities Act 1972. On the documents that were made available last Friday, the hon. Member for Newham, South (Mr. Spearing), the Chairman of the Scrutiny Committee, will confirm that the Committee had sight of those working documents early in December. The latest versions of the documents were deposited in the House on Friday. They are working documents, as stated in the motion.
§ Mr. Peter Hardy (Wentworth)
Further to that point of order, Mr. Speaker. Some of us spend much time discussing matters with our colleagues from the various eastern European countries and the debate is important to us. We were unable to receive or see those documents before we left the House last weekend. You will appreciate that weekends are very busy for many hon. Members. It is irresponsible and unreasonable for the House to be expected to debate documents which we have not had an opportunity to see.
§ Mr. Speaker
I cannot say much more about the matter. I understand that the documents were available on Thursday afternoon, which would have enabled Members to get hold of them before the weekend.
§ Mr. Robertson
Further to that point of order, Mr. Speaker. The documents were specifically held back. As you well know from your background, we have a good knowledge of what the business might be for the following week before Thursday at 3.30 pm. Indeed, Opposition spokesmen are nominated to answer debates and Government spokesmen are put up before that. As the Opposition Front-Bench spokesman, I requested a copy of those documents on Thursday and I was told that I could not have them because they could not be released from the Select Committee of the House to me until the Leader of the House had spoken at 3.30 pm.
I realise that such matters are catching you off guard, Mr. Speaker. They are being raised in this way because I found out about them only earlier this evening. The Minister's answer did not cover the association agreements. They are mentioned in the motion to be put forward by the Government this evening. Only six copies were available and hon. Members therefore had no opportunity to study them before this important debate.
§ Mr. Speaker
This is an hour and a half's debate and the House does not want to be kept up all night listening to points of order. I am not responsible for when documents are placed in the Vote Office, but I do not disagree with what the hon. Member for Hamilton (Mr. Robertson) has said. It is unsatisfactory if hon. Members do not have an opportunity to study documents that we are about to discuss, because it leads to inadequate debate.
§ Mr. Bob Cryer (Bradford, South)
Further to that point of order, Mr. Speaker. In view of the complexity of the documents involved, rather than allowing Parliament to continue without adequate information, would it not be better to suspend the House for 10 minutes to allow the usual channels to arrange a different time to ensure that hon. Members have an adequate opportunity to consult the documents? Surely that would be fair.
§ The Minister of State, Foreign and Commonwealth Office (Mr. Tristan Garel-Jones)
I beg to move,That this House takes note of the proposals described in the unnumbered Explanatory Memorandum submitted by the Foreign and Commonwealth Office on 29th November 1991, 128 relating to Association Agreements between the Community and its Member States and Poland, Hungary and Czechoslovakia, and European Community Document No. 10561/91, relating to interim agreements between the Community and Poland, Hungary and Czechoslovakia: welcomes the principle of Association Agreements between the European Community and the reforming democracies of Poland, Hungary and Czechoslovakia; recognises that these Agreements will offer them substantial benefits by encouraging trade with the Community, enhancing political co-operation, and strengthening links with the European Community to which these countries have expressed a wish to accede; and looks forward to early ratification of the Agreements.The three association agreements—one each with Czechoslovakia, Hungary and Poland—are mixed agreements. There are elements which fall under Community competence and others that are intergovernmental. We hope that the main agreements will come fully into force before the end of the year. Those main agreements to which the hon. Member for Hamilton (Mr. Robertson) referred will require a separate ratification debate in the House under section 1(3) of the European Communities Act 1972. The whole process of ratification in all 12 Member States is likely to take some months.
For that reason, and to avoid delay, the Community has decided to bring forward the implementation of those elements—mostly trade liberalisation measures—which fall entirely under Community competence. They are to be formally adopted on 25 February for imlementation on 1 March.
We are scrutinising both main and interim sets of agreements this evening. The Select Committee on European Legislation has rightly identified these agreements as politically important and worthy of debate. The House will be notified in due course of the Government's plans for ratification of the main agreements under section 1(3). A proper debate on that matter will take place in the House.
Help for central and eastern Europe falls under five broad headings. The association agreements are tailored to dovetail into existing help in all five areas. To be effective and to give the sort of substantial help that we wish to give, the association agreements must open the Community's markets to goods from Czechoslovakia, Hungary and Poland. The first and perhaps the most important element is trade liberalisation.
The agreements allow for the asymmetric lowering of trade barriers. The EC has agreed to reduce its barriers to imports more quickly than Czechoslovakia, Hungary and Poland reduce theirs. That is only right. The EC is a very large market. If the associate countries are to restructure their economies successfully, it will be vital for them to have full access to the EC's markets as quickly as possible.
The agreements also provide for a substantial measure of trade liberalisation in agriculture because agriculture is the area in which the three countries are most likely to become competitive. After only three years, import charges on their agricultural exports to the EC will be reduced to 40 per cent. of the present level, and the volume of their exports eligible for those preferential terms will grow by 50 per cent. over five years. Further progress towards free trade in agriculture will be made during the second five-year period of the agreements.
§ Sir Teddy Taylor (Southend, East)
Has an assessment of any sort been made of the likely increase in CAP expenditure and in surpluses as a consequence of this superb trade rationalisation? Does not the Minister think 129 that it would be sensible to make some move towards reducing the cost of the CAP before inviting a further flood of trade which will simply add to the mountains of surpluses and to the cost of the CAP?
§ Mr. Garel-Jones
I am sure that the Parliamentary Secretary to the Ministry of Agriculture, Fisheries and Food, my hon. Friend the Member for Skipton and Ripon (Mr. Curry), who will be winding up the debate on behalf of the Ministry, will wish to answer my hon. Friend's detailed points. I am glad and not at all surprised that my hon. Friend the Member for Southend, East (Sir T. Taylor) welcomes agreements on agricultural free trade. One of the advantages of the agreements is that they will be beneficial to consumers in this country.
§ Sir Teddy Taylor
How will they help consumers? The Minister has made a specific statement that consumers will be helped. They are suffering hugely at present. If the expenditure and the mountains increase, how will the consumer be helped in any way? Will the Minister please tell us?
§ Mr. Garel-Jones
The consumer will be helped by the increased competition that the arrival of high-quality food at low prices from eastern European countries will bring to our markets.
§ Mr. Garel-Jones
I should like to make some more progress and then I shall give way.
Secondly, there is economic co-operation. That covers a wide range of sectors from industry and investment protection to energy, education and the environment. The aim is to help the three associate countries to build up the political and economic structures of a modern state, to compile reliable statistics and to enable them to help small and medium-sized companies and to counter the activities of money launderers.
§ Mr. Tam Dalyell (Linlithgow)
On education and the environment, may I ask the question of which I gave the Foreign and Commonwealth Office notice—can anything be done to prevent the sale across frontiers of the beautiful wooden carvings that the all-party heritage group saw throughout northern Bohemia? Churches in remote areas are being robbed and vandalised. Would it not be ironic if with the end of communism there were an absolute collapse of any protection for Czechoslovak art? That is happening as a result of western European greed.
§ Mr. Garel-Jones
The hon. Gentleman is absolutely right to express concern about that. He has already written to my right hon. Friend the Secretary of State about it. As he knows, these matters are ultimately for the police in Czechoslovakia, but he will be pleased to learn that some of the assistance that we are giving that country, through the know-how fund, is aimed at helping the police force there to pursue criminals of this sort. I certainly share the hon. Gentleman's concern.
§ Mr. Hardy
Will the Minister take note of the fact that, at various meetings in those countries, one of which I recall attending in the Budapest Parliament, members of his party—I exclude the hon. Member for Hampstead and Highgate (Sir G. Finsberg), who has played a distinguished role in all this—repeatedly and vigorously urged these countries to sweep away all regulations and to 130 leave their countries free for entrepreneurs from western Europe, who would then help them? Because such regulations were swept away, this sort of scandal is bound to occur, and is bound to be repeated, until more sensible advice comes from western Europe.
§ Mr. Garel-Jones
I recognise that there is a certain nostalgia among Labour Members for at least some of the repressions and controls that used to be exercised on the other side of the iron curtain. The hon. Gentleman knows better than to try to attribute the rise in crime in some of those countries to the freedoms and liberal market economies being built up in them. That will not wash. The hon. Gentleman and many of his hon. Friends still find the idea of a free market offensive, but that is the very concept that these associations agreements are designed to bolster.
The third aspect deals with approximation of laws. In anticipation of successful applications for Community membership the three will take steps to bring basic commercial and financial legislation into line with Community legislation. That will be working with the grain, because market forces will encourage them to base their laws on Community texts. We are ready to help with the drafting of laws, under our programme of technical assistance, when we are asked to do so. British advisers are already at the centre of the privatisation programmes in Czechoslavakia, Hungary and Poland.
Fourthly, I refer to the political dimension. The growing political dialogue with these three countries is not an EC monopoly. The Conference on Security and Co-operation in Europe, the North Atlantic Co-operation Council and the Council of Europe, whose president, my hon. Friend the Member for Hampstead and Highgate (Sir G. Finsberg) I see in his place, are all closely involved too. But the EC is the club to which the central and east Europeans most want to belong. To help that long-term ambition, to prepare the way and to give a foretaste of what membership involves, the association agreements will set up association councils which will meet once a year at ministerial level to review and build on the agreements.
A committee of officials will assist the council. There will be a political dialogue with the Twelve's machinery for foreign policy co-operation. Already these countries are being influenced by decisions taken by the Twelve.
Fifthly, I must deal with financial arrangements. The agreements do not directly cover financial help, but the record of Community members is good. The Community set up the special PHARE programme of technical assistance, initially for Poland and Hungary but now covering all of eastern Europe. So far, the Community has committed £877 million to these programmes. The agreements promise to continue technical assistance beyond the end of this year.
For these three countries, association agreements bring to an end that chapter of European history which began with the collapse of the Berlin wall. That collapse demonstrated that command economies of the kind favoured by socialists do not work and that the more extreme attempts to make socialism work through communist dictatorship resulted in the cruel and immoral denial of human rights. Secondly, it gave the lie to the fashionable internationalism of the last 40 years that sought to deny that patriotism and the sense of belonging to a nation could—indeed, should—be subsumed under some sort of all-enveloping socialist morality. In the end, 131 it was that sense of belonging that gave Poles, Czechoslovaks and Hungarians the courage to come out into the streets against communism.
Those of us in the west who have consistently advocated free market economies underpinned by democracy—[Interruption.] I recognise that the hon. Member for Liverpool, West Derby (Mr. Wareing) is not one of them—therefore had a moral duty to move to support these new democracies. That is why it was the British Government who first proposed association agreements in the European Council in Strasbourg in December 1989, and that is why my right hon. Friend the Prime Minister moved to speed up the negotiations last summer.
These agreements begin to substantiate the euphoria with which we all greeted the arrival of Poland, Czechosolvakia and Hungary into the family of democratic nations. They provide the tools for consolidating democracy and creating a liberal market-oriented economy. [Interruption.] I recognise that the hon. Member for West Derby does not like that sort of economy, but that is the kind of economy we seek, however painful it may be to the hon. Gentleman to hear that.
Britain's leadership in this area, in setting up the association agreements in the first place and pushing for them within the Community, is widely recognised and much appreciated in those countries. We now have to build on the agreements and make them work. We hope to be able to hold the first association councils during our presidency and we hope that the agreements that in the their preamblerecognise that Poland, Hungary and Czechoslovakia's ultimate objective is to accede to the Communitywill indeed help them to achieve that objective. In that spirit, I commend the motion to the House.
§ Mr. George Robertson (Hamilton)
I hesitate to return to the point of order which was made before the debate started, but it is essential to drive, home to the Minister that the way in which we deal with European Community business is wrong and inefficient and should not be tolerated. The Minister underlined the importance of the subject throughout his speech. The way in which the House has been treated is therefore a classic illustration of how the House should not deal with business of such importance.
It is not appropriate that we should receive copies of the documents late on a Thursday afternoon when they are to be debated in the House of Commons on the following Monday. It is intolerable that documents of such consequence as the association agreements, which were signed by the Government on 16 December 1991, are still unavailable to the House of Commons in the middle of February 1992.
It should come as no surprise to the Minister that the Opposition welcome the agreements between the European Community and Poland, Hungary and Czechoslovakia, from what we have been able to read of them up to now. We believe that it is in the interests of those countries and of Europe as a whole that full 132 European Community membership should be seen as the aim of the exercise. We therefore warmly applaud the inclusion in the preamble of the wordsbearing in mind the ultimate objective of the three countries is to become full Community members … this agreement will help to reach this.We believe that the political stability of the central European new democracies will be secured only by, first, the achievement of economic strength and, secondly, the adaptation of their political, legal and social institutions to the standards that we take for granted in the west of the continent.
These association agreements, or European agreements as they are now called, have to be seen as a first step by us in the still wealthy and politically secure and stable west of the continent to enrol our central European partners in our far from exclusive club. We shall have to go well beyond the measures in the agreements to ensure that full membership is attainable and possible. Much can be done to make that happen, but much still needs to be done.
I should like to share with the House my feelings of last weekend. On Saturday afternoon, I walked for about a mile with my daughter, Rachael, who is 11. There was nothing particularly spectacular or remarkable in that, even for a politician seven weeks away from a general election, but our walk was slightly out of the ordinary. We walked from the Reichstag in Berlin, the future home of the Parliament of the unified Germany, through the Brandenburg gate up the Unter den Linden to the Volkskammer, the defunct Parliament of the now defunct German Democratic Republic.
In a hastily written peroration, the Minister referred to the Berlin wall and its demolition in 1969. I first saw the Berlin wall in 1981 when I visited the city with Brynmor John and other members of Labour's defence team. I could not disguise my revulsion and shock at what the wall looked like and what it represented—a lethal concrete partition down the centre of Europe. It was a division not only between east and west Berlin but between two systems —one corrupt and venal, prostituting the word "socialism" and denying real and vital freedoms, and the other system, which perhaps is imperfect and fickle but which allows its citizens a choice of opinions, goods and futures. We shall exercise that choice in only a few weeks, time.
Like so many other hon. Members, I saw the wall and checkpoint Charlie again and again over the years, and it never ceased to be an obscenity. In 1983, I asked Richard von Weizsacker, then governing mayor of west Berlin and now the first president of the united Germany, whether he thought that I would be able to walk through the Brandenburg gate with my daughter in the year 2001, when she will attain the age of 21. He and I, and I am sure every other Member of the House, thought that that was an impossible dream, but last Saturday my daughter and I did what so many have done since that famous night on 22 December 1989 when the most famous closed road in Europe was opened. It was a moving moment that I will never forget.
I drew two lessons from that walk. First, if we in the west had been able calmly and rationally to choose whether to admit the citizens who lived beyond the Brandenburg gate into the European Community, would we have done so so quickly? Given the basket-case nature of the economy of the German Democratic Republic, would not it have been put a long way down the queue for 133 membership of the Community? The reality is that we had no choice. The GDR united with the Federal Republic of Germany, and had it not done so its citizens would have decamped into the territory of West Germany. Like it or not, they are now full members of the European Community, and the Community has not trembled as a consequence.
The second lesson of our collective sweet relief that the 28-year-old Berlin wall had come down was that we dare not rest on our celebrations. There is a danger—a real and live danger—that one wall will come down and another one, an economic wall, will go up between the club members and failed applicants, between the rich west and the poor unstable countries in the east and between those who enjoy the taste of freedom of movement and those who will be told that we have no room for them and 'will they kindly keep out.' Speaking personally but with some passion, I hope, having experienced that liberating feeling last Saturday in Berlin, I have no intention of letting my daughter grow up in a world in which she will have to fight to get the gates—new economic gates as they may well be —open once again in 20 years' time. In the short term—
§ Sir Teddy Taylor
Will the hon. Gentleman explain this liberalisation for the people of eastern Europe? According to my reading of the agreements, they state that freer trade and the ability to increase our food mountains depend on those countries first agreeing to the progressive harmonisation of their laws with ours. How does it create liberality in Europe if they have to adopt EC laws so that they can dump their food and add to our dumping?
§ Mr. Robertson
I shall let the hon. Gentleman continue his private war with members of his Front Bench because he finds that much more enjoyable, and so do they.
Inevitably, we and the people of eastern Europe want to see a harmonisation of their laws with those of the European Community. They are not obliged to do that, but that harmonisation is their target, their wish and their desire. They are willing to work towards that target which they believe will build a strong democracy for them in the future. Perhaps at some distant point in that future—and especially under a Labour Government—some sanity will be brought to the common agricultural policy. We are committed to that, and it is something that the Conservatives have signally failed to achieve in the past 13 years.
In the short term, it is not our aid or our technical assistance that will make the difference to the economic convergence, although it will have a major role to play but trade between west and east. That is the real importance of the European agreements. They will start the process of allowing the central European states to build export markets. Only by selling their goods will they provide jobs and guarantee prosperity for their people. If we close off markets, we risk their economic experiments and our own security. If this fails, we can confidently—
§ Mr. Oppenheim
If time is that short, perhaps the hon. Gentleman should have spent less of it talking about his nice stroll through Berlin.
134 He rightly said that it was crucial for eastern Europe that we open our markets to it, but surely if he reads the documents he will find that we are not opening up our markets to eastern Europe—we are keeping them closed for a further five to 10 years. At the very time when those countries are desperately struggling to convert their economies to market economies, we are not practising what we preach, because we are keeping our markets closed to their goods.
§ Mr. Robertson
These are minimum periods. Yes, perhaps they are too conservative. Perhaps the Government whom the hon. Gentleman supports at the moment took too conservative a view, but these agreements for progressive liberalisation of the markets were reached by both sides. Perhaps the hon. Gentleman should concentrate his attention on the members of the Government Front Bench rather than on me.
There is a serious danger that if we fail, especially on the issue of trade, we can confidently expect the pressures of immigration to intensify. To expect the possibility of a return to a new and perhaps even more ruthless authoritarianism is certainly not scaremongering.
The director of research for the general agreement on tariffs and trade, Mr. Richard Blackhurst, recently calculated the threat from central and eastern European trade. He pointed out—these are interesting statistics—that in 1988 Czechoslovakia, Poland and Hungary had a combined share of world trade below that of Hong Kong, South Korea, Singapore and Taiwan back in 1970. Since 1970, the Asian four tigers, as they are called, quadrupled their share of world trade, yet it has not had a dramatic impact on western Europe.
To be more specific, in western Europe in 1988, only 1.3 per cent. of all manufactured imports came from the countries of eastern Europe—hardly a real danger to our economic survival. Britain's trade with central Europe lags well behind that of Germany, France and Italy. Those countries see a long-term potential in the new markets in eastern Europe, whereas in Britain a combination of short-term conservative business attitudes and a privatised Export Credits Guarantee Department means that yet again we shall lose.
Aid and assistance is vital if we are all to benefit from the experiment in central Europe. Much has to be done. Fair enough, four fifths of all foreign aid committed to eastern and central Europe has come through the European Community and the PHARE programme has done much, but alongside help from the Group of 24 and the Group of Seven there has been tied aid and guarantees which have not been taken up. Our belated bilateral programme, good as it is in quality and excellent as it is in delivery, is nothing like enough to make a lasting impression.
Next year, our know-how funds for all five countries in central and eastern Europe—I pay tribute to the success of the funds—will amount to the grand total of £30 million. That is the sum to be spent in Poland, Hungary, Czechoslovakia, Bulgaria and Romania. That is a ludicrously miserable sum when our exports of banking, accounting, management and English language training skills are so popular and so much in demand and there is such a valuable pay-back in the long term.
§ Mr. Garel-Jones
By how much would Labour propose to increase the know-how fund? Has the hon. Gentleman had clearance from the shadow Chancellor of the Exchequer?
§ Mr. Robertson
We have already made the commitment that there will be an increase in the know-how funds. The precise amount cannot be stated now. The Foreign Office is in no position to give guarantees. We are told that miserable sums will have a deep and lasting impact, yet the Government are not in a position to say how much more will be spent. Outstanding work is being undertaken by the British Council, by our embassy personnel, by organisations such as Voluntary Service Overseas and by other countries, and it should be backed by real money. The United Kingdom could give that money and the countries that we are discussing could use it.
§ Mr. Robertson
No, I shall not give way. I am conscious of the limited time that is available for the debate.
Britain is one of the few countries in the European Community still to insist on a rigorous and highly unpopular visa requirement for Poles coming to this country. Can the Minister justify that policy, bearing in mind the fact that Britain stands alone? What will happen to the policy when the agreements take effect?
In the words of the chief negotiator of the Commission, Mr. Pablo Benarides, the agreements are not "an entrance ticket" to the EC. He referred to them as a "kind of trial run". We see them as the start of a process that involves genuine political will to make these countries become members, to help them with the convergence that will be necessary and to ensure that economic and political barriers have no more place in the Europe of tomorrow than they have at present in the heart of Britain.
§ Sir Geoffrey Finsberg (Hampstead and Highgate)
I should like to raise the sights of the House somewhat. The motion mentions the fact that the three nations in question wish to accede to the Community. To do that, they must satisfy a major test, which is to be quite certain that their laws on human rights and elections meet the high standards of the Council of Europe, which has now been recognised by the European Community as the bridge over which the nations can cross to it in the years ahead.
We had to find a way of bringing the nations into association with us. That we did by offering them guest membership of the Council, which gave them the opportunity to participate in our democratic debates, to take part in our committees and to see—after four decades and more—how a democracy worked. I had the great privilege of formulating the rules under which the countries were able to enter the Council of Europe. I did so with the assistance of the hon. Member for Wakefield who, in other circumstances, is my hon. Friend—
§ Sir Geoffrey Finsberg
Yes, Wentworth, where there is that ghastly American mess of chemicals which should never have been there.
Between us, the hon. Gentleman and I managed to formulate the arrangements. That has resulted in the full membership of Poland, the Czechoslovak Federal Republic and Hungary, which is far more important than the quibbling over detail that I have heard at least twice tonight.
We must look much wider. I received Lech Walesa in my office in Strasbourg last week—we had about 40 minutes' worth of conversation together—and the major problem that he put to me—[Interruption.] Will my right hon. Friend the Minister allow me? Lech Walesa said that the major problem was that, although the west had paid enormous tributes to Poland for being a pioneer in breaking free, the words had not been matched by deeds, and he was having immense problems in finding a way of converting the Polish economy to the sort of methods that were needed to turn Poland round.
I had also met him four months earlier, when I led the election observer team. On that occasion, the worry was whether Poland would produce a Government that could command a majority in the Sejm. They could not command a majority, and democracy was multi-party.
We now have the opportunity to show the three nations in question that the west is willing to find a way of encouraging their trade. Mr. Walesa told me, "You have been very generous in exporting your goods to our countries so that we spend our money on buying imported goods. We wish that you would give us an opportunity to produce more goods in our country that you would buy." That is what is needed, and I believe that the proposals in the document are a first step.
There is a very real danger that, before too long, if things do not work out properly, we may have a Czech republic and a Slovak republic and there will no longer be a federal republic of the two. That would be a tragedy. If the citizens of the countries can see that democracy pays them dividends—if they have goods to buy at prices that they can afford—we stand a chance of success. If we do not show them that, there is a real risk—as the hon. Member for Hamilton (Mr. Robertson) and my right hon. Friend 138 the Minister said—that the democracies will fail. If they do fail, we in the west will have to take much of the blame for being too protectionist, too little Englander and too unwilling to live up to the reputation that we ought to have —that we aid democracy.
§ Mr. Peter Hardy (Wentworth)
The hon. Member for Hampstead and Highgate (Sir G. Finsberg) referred to me a moment ago. It is only right that the House should be aware of the considerable contribution that he has made over the past two or three years—not least in being very active in the Council of Europe in Strasbourg during a period of change.
I am very worried indeed about the likely consequence to which the hon. Gentleman referred. Only a week or so ago in Strasbourg, I asked the Chairman of the Council of Ministers whether he was fully aware that, two or three years ago, we were talking about a Europe of 15, and within the next 18 months there is likely to be a Europe of 45.
As Europe has widened, Czechoslovakia, Hungary and Poland have become full members of the Council of Europe, which, as the hon. Member for Hampstead and Highgate said, is a staging post to full membership of the Community of Europe. However, if a mess is made of the development of those three states, the rest of the emerging republics of eastern Europe will face a colossal crisis.
Although I am not critical of the hon. Member for Hampstead and Highgate, I am perhaps critical of all other Conservative Members. I believe that Britain and the rest of the Community have made mistake after mistake. It is all very well to say, "Open your countries to democracy and trade." About 18 months ago, I attended an important debate in the Hungarian Parliament, in which advice was offered by people from the right of European and British politics—and perhaps one or two Conservative Members, such as the hon. Members for Bournemouth, East (Mr. Atkinson) and for Lewes (Mr. Rathbone), who play such distinguished roles there and who devote a great deal of time to the Council of Europe, were present; I cannot remember.
However, the Polish Prime Minister and the Polish Foreign Secretary and the Czech Prime Minister and Czech Chancellor of the Exchequer were also present. They were advised to copy the philosophy that has dominated our Government: they were told to privatise. They were even given the specific example of the need to sell off their council houses so that the capital receipts would, as in Britain, stimulate their building industries. I had to point out that those capital receipts in Britain were largely frozen, and that that advantage did not apply here.
That may be a petty example, but the fact remains that we have told them that we can offer them a great deal, but they have gained remarkably little advantage. The hon. Member for Hampstead and Highgate said that Lech Walesa had told him that we must deliver what we appear to have promised. We are not doing that. Poland is likely to face a greater economic crisis than it faced before.
The Minister seems to be making the mistake of assuming that Europe will open its doors to agricultural exports. We might; the Danes might and the Dutch might. Even the Germans might. However, does the Minister seriously believe that the French, Spanish or Greeks will be happy to allow the agricultural exports from 139 Czechoslovakia, Hungary or Poland to enter their countries? Would there be no protests from French farmers as Czechoslovakian, Hungarian and Polish agricultural products sought to enter their markets? We are in danger of leading the newly emergent countries of eastern Europe into believing that the west will be as co-operative as the west appears to promise.
As I have said, within two years there will be a Europe of 45. It is possible to list the various republics that will comprise that number. It is less than two years since Finland became the 23rd member state of the Council of Europe when we celebrated its 40th anniversary. One can only marvel at the pace of change politically in Europe. That change embraces the concept of extensions of human rights which are politically highly desirable. Unless the political change is matched by an economic wisdom that none of us has yet perceived and which is scarcely discernible, given the appalling way in which the House is kept informed of changes in Europe—
§ Mr. Hardy
It is no good the Minister shaking his head. How much opportunity has the House had to consider properly the dramatic changes that have taken place in Europe? Leaving aside the contribution of Opposition Members, how much of an opportunity has the House had to consider the contribution made by the Government in pursuit of those changes?
We are having a late-night debate when the House is scarcely given a proper opportunity to see documents or to consider the facts. Specious promises are offered in a document that seems to present much but actually offers little. It is time that, in Britain and in the rest of western Europe, we saw much more vision and common sense. The serious political changes that are now taking place are not being matched by anything like mature economic consideration.
One cannot say that the debate takes us any further, except of course, that it gives one the opportunity to pay tribute to some Conservative Members, particularly the hon. Member for Hampstead and Highgate, who has become the President of the Council of Europe and who deserves rather more consideration than he has been given by some of his hon. Friends.
§ 11.4 pm
§ Mr. David Howell (Guildford)
There surely can be no doubt that the draft interim agreements are a modest but most definite step in the direction that we all want to see, which is the creation throughout Europe of a great confederation of free republics and monarchies—free democracies—operating free markets and achieving market prosperity. That is the aim for which the previous generation fought the second world war. At the end, those people were cheated and they found that half of Europe had been cut off and denied the democracy, free enterprise and markets that brought great prosperity to western Europe.
This is clearly the right step forward. It is not, of course, anything near the certain road to full membership, which I should like to see. The small print of the draft agreements shows that although the parties seeking to associate themselves—the troika of Poland, the Czech and Slovak 140 federal republic and Hungary—believe that by signing them the objective of membership is recognised, that is a rather one-sided affair. It is only on their side that there is hope that they will achieve that objective. There is no guarantee provided by the signatories of the Community that it will lead to membership. The reality is that that prospect lies a considerable way away, whether we like it or not.
I agree with the eloquent words of my hon. Friend the Member for Hampstead and Highgate (Sir G. Finsberg), who plays such a distinguished part in the Council of Europe, that if those countries fail, will be our failure. If they do not succeed, having thrown off tryanny and making it all the way to open and free societies, the cost for us will not merely be that we blame ourselves; there will be direct and ugly costs in terms of destabilisation, migrant movements and pressures which could be very unsettling. There would be a weakness in the whole economic flank of western Europe, and even darker forces could be unleashed to upset the tranquility of the previous 40 years in western Europe on which one will look back. The stakes are very high and they must, by all efforts, succeed. If, in the long run, we do not allow the goods to come into western Europe and, indeed, into the wider world, the people will. That will be an awful trade-off, and there will be very little that we can do to prevent it.
Those must be the long-run aims. They will be very long run, for obvious reasons. First, although the economies about which we are talking have begun to be transformed, they are still far from being anything like market economies and far from operating sensible price structures. There is no way in which, tomorrow morning, they could link into full-blown, treaty of Rome, Commission-negotiated membership of the classic Community.
Secondly, whether we like it or not—some hon. Members clearly do not like it at all, and I understand why —the agricultural interests of western Europe, already under seige and deeply protected, will not allow the vast agricultural output of those countries—for example, the huge arable output of the Danubian plain and the vast meat output of Poland—to come rolling into western Europe or, possibly, on to world markets. There is no question of full membership in that sense being permitted for many years to come—indeed, it is very hard to see at this stage how that could ever happen.
The third reason why there will be resistance to full membership is enlargement indigestion. Earlier this afternoon, we debated the arrival of the "Eftans" in the European economic area agreement. Five of them are rapidly lining up to become full members of the Community. Most of them want to do so by 1995. The bureaucrats of the Community look on that alone with great alarm. The prospect of the further three being full members, even by the year 2000, fills people with dismay, particularly those who believe passionately in the original tight-knit European Community structure as set out by the treaty of Rome.
Those of us who want a change of direction to a wider Europe believe that with enlargement, provided that the process is handled carefully, a European union better than the one that we have at present can be created. That is certainly my wish. But for those who operate the finer points of the negotiation inside the Commission, enlargement at this speed, involving not merely the five "Eftans" but the three which are the subject of the 141 association agreements and many other countries besides, as the hon. Member for Wentworth (Mr. Hardy) suggested, is a dangerous prospect. It could dilute and fundamentally change the Community as we know it.
I wish to ask three questions about the scene that lies before us with Poland, Hungary and Czechoslovakia. First, to what extent will the draft association agreements fill part of the gap and meet any of the immediate need of the three new democracies? Of course they will help, but I am not sure that they are enough. The need of those countries is obviously not merely to get some trade going, to have know-how support, project aid and budget aid and to have their currencies finally stabilised; it is psychologically to feel that for certain they are part of the European community—community with a small "c", the community of the free Europe—and that they will not be sucked back into any form of militarism or fascism, particularly with the vortex of chaos developing on their eastern flank in the extremely shaky Commonwealth of Independent States.
These countries want firm links of a political nature that will begin to bind them into the freer and wider Europe that we all want to see. I hope that it will be the absolute priority of the British Government during our presidency to ensure that the association agreements are not only put in place fully—that must be so—but thickened and developed and that they offer more than merely signatures on bits of paper with officials then saying, "Goodbye, we are off to Brussels again, see you in a few years." That would not be good enough.
We need to think in terms of stronger political links now for the three countries, which are all in extreme danger. Living standards are falling in all of them. Even in Hungary, which we think of as successful, living standards are precarious. As a result, the democracies are precarious. The countries are living on a diet of hope and prayer and the belief that just round the corner a few years away there really will be a turnaround, or on a diet of overspill of deutschmarks from the vastly funded former East Germany which is their neighbour. But it is a precarious existence and it could collapse at any moment.
The three countries need support now and we have to think about how that can be given. Of course, the small print of the association agreements offers more than just the hope of some asymmetrical lowering of trade barriers and the distance promise of a little agricultural trade one day. The agreements offer a political consultation procedure and imply that Heads of Government and Ministers of the three countries and the leaders of western Europe will met regularly. That will help. Some network of closer links can be developed there.
My hon. Friend the Member for Hampstead and Highgate spoke about the Council of Europe and he has personally given great leadership on that front. It clearly provides—"waiting room" is the wrong phrase—a place where the new democracies can stand shoulder to shoulder with, exchange views with and begin to understand the new world which they have joined and to which they are welcome.
On the security side, there is the famous North Atlantic Consultative Council, which is NATO's attempt, if not to extend its guarantees, to extend some shadow of security to eastern European countries. They need it. They need a security framework. That is on offer, but the NACC is a 142 large club. It includes all the successor states of the former Soviet Union and it may not be enough. The countries of eastern Europe will probably need something else.
We have to ask why we cannot link Poland, Hungary and Czechoslovakia now with other aspects of the new European union that we have just invented. At Maastricht we set up not a European Community—that is the past —but a European union, which includes the Community and the new pillars of foreign and security policy and other policies.
There is no reason why there should not be ministerial-level collaboration on a formal basis with those countries, so that, without facing the full rigours of the market or the full requirements of the negotiating procedures of the Commission, they can be involved, here and now, in a European entity. That could even be a political union, or the greater European union that many of us want to see and that will take us far beyond, and wider than, the old EC.
I welcome what has been done, but it is only a start. We are looking now, as we did in the earlier debate about the EFTA countries' membership of the European economic area, at the shape of the European union to come. It is not like the past. Maastricht was not a stepping stone to another bout of the same kind of Europe. Thanks not least to the vast skills that my right hon. Friends the Prime Minister and the Foreign Secretary used in their negotiations, it was, as we shall see when we debate ratification, a change of direction for Europe. It was a move towards a union that will be a home for these new democracies. We fought a war to bring freedom to them and failed. Now, we have another chance.
§ Sir Russell Johnston (Inverness, Nairn and Lochaber)
I wish first to associate myself most warmly with the remarks made by the hon. Members for Wentworth (Mr. Hardy) and for Hampstead and Highgate (Sir G. Finsberg). Both struck exactly the right note, and put the debate in proportion. The election of the hon. Member for Hampstead and Highgate as president of the Council of Europe following the resignation of Anders BjÖrck is well-deserved, and we can see why he deserved it from what he said.
I shall not repeat what the hon. Member for Hamilton (Mr. Robertson) said about the debate, but I associate myself with it entirely. It makes a mockery of all this stuff about the pre-eminence of Parliament if we do not have the documents and are given a mere weekend's notice. It is all very well for the Minister to say that the documents were available on Friday, but everyone knows where Members of Parliament are on Friday—in their constituencies. Then we are given only an hour and a half for the debate. It is not very good, is it?
As hon. Members have said, what we are debating is of the greatest importance not only for Poland, Czechoslovakia and Hungary, but for the former Soviet Union. The move to democracy in these three countries has coincided with the break-up of the Soviet union. Their position, as forward examples of the success of the free economy, is of the greatest importance.
The explanatory memorandum refers in its first paragraph to the association agreement being founded on a United Kingdom proposal. I am sure that this is correct, but I would be happier if we stopped boasting about our 143 role when the help that we give in trade and aid is noticeably less than that given by others. The increase in trade achieved by the three countries with the west has, to a small extent, offset the loss of commerce with the Soviet Union, but it has been with Germany, which is now the major trading partner of all these three countries. Germany has likewise been in the lead in providing aid. When I recall the remarks made in the Chamber after the unification of Germany, about the threat that it would represent—some of the more notable came from a right hon. Member who was at that time a Minister—I think that those who made them should hang their heads in shame.
As the hon. Member for Hamilton said, the political stability of central Europe is of the utmost importance, but equally the restructuring of economies there can be seen to be of enormous complexity and difficulty. Goodness knows, the Germans are finding this in what was East Germany, and the situation in these three countries is more difficult still because they do not have the resources that the Germans can provide or the expertise for the managerial takeover in which they are engaged.
At the end of last year, I was one of the Council of Europe observers at the Polish elections and spent a cold, snowy day in Poznan, which was the scene of terrible riots many years ago. It was very orderly and quiet—almost dull. The turnout was miserable—under 40 per cent.—and, as the hon. Member for Hampstead and Highgate has already mentioned, representation was hugely fragmented.
The hon. Member for Hamilton said that if visible progress was not made in an acceptable period there would be the danger of a return to authoritarianism. That is certainly not impossible, for hunger drives out democracy very quickly. The hon. Gentleman was also right to point to the size of the know-how fund: £30 million is not insignificant, certainly, but it will not make all that much of an impression. The Minister may ask, "How much would you make it?" I am not in the business of doing that sort of thing; I am simply saying that I am tired of people being self-congratulatory about what they are not entitled to congratulate themselves about.
I am sure that the hon. Member for Wentworth and the right hon. Member for Guildford (Mr. Howell) were right to pay particular attention to the difficulties affecting agriculture. I am equally sure, however, that the idea of triangular trade—in other words, helping the countries to export to what was the Soviet Union—is the easiest solution, at least in the short term.
We are talking about transition from a communist economy to a free economy; we are talking, we hope, about a transition that willl lead to membership of the European Community—some years hence, but within a perceptible period. We are talking about how we can help in that process. The proposals are certainly a step forward, but I do not think that we should congratulate ourselves too much: a good deal more is needed.
§ Mr. David Atkinson (Bournemouth, East)
Until the Maastricht summit, there was, in my view, a real danger that the iron curtain would be replaced by a silver curtain dividing the rich from the poor in Europe, and that the Community would commit itself to ever-greater union 144 without regard to the rest of the continent. As my right hon. Friend the Minister has just reminded us, it is thanks to our right hon. Friend the Prime Minister's insistence that the negotiations of last summer have led to the agreements that we are discussing.
Nevertheless, the agreements have not come before time, given that the democratic revolutions in the countries concerned took place over two years ago; nor do they reflect the enormous scale of the problems that those countries face as they attempt to move from central, planned economies to a free market, with the ending of subsidies, the inflation and unemployment that are inevitable in such transitions and the social and industrial unrest that is happening in all three countries to varying degrees.
We need only look at the defence industries of the three countries—we are debating this at the Western European Union in December—to see the extent of the devastation that their economies now face. Czechoslovakia's defence industry alone faces a decline of 80 per cent., and the lack of research and development is rendering the remaining 20 per cent. obsolete. Poland's huge over-capacity in the manufacture of arms and equipment offers little hope of conversion, while Hungary's defence industry is almost non-existent; what is left of it now faces bankruptcy.
We can and do provide help and technical assistance through the Community's PHARE programme, and through our own know-how fund. It is, however, the opportunity to trade—to sell to the rest of us in the Community, through a reduction in the number of barriers—that represents the most immediate and practical help that we can offer now. As my hon. Friend the Member for Amber Valley (Mr. Oppenheim) said a few moments ago, the agreements provide for a transitional period of up to 10 years. That can be of no help when help is most wanted—now.
My hon. Friend the Member for Hampstead and Highgate (Sir G. Finsberg) mentioned the private conversation that he had with President Walesa when he visited the Council of Europe two weeks ago. No wonder he reminded the parliamentary Assembly that it was his country that had cracked communism and freed the West from the cold war, which had, in turn, enabled us to reap the peace dividend. He felt that he was entitled to more help than that provided by the agreement. How right he is.
I hope that my right hon. Friend can assure the House that more opportunities to trade will soon be available to those three countries than those contained in the agreements. I hope that he can assure us that all the remaining COCOM restrictions against those countries will be lifted—none of them pose any threat to us now. I hope that he can confirm that the agreements will be extended to include the emerging democracies of eastern Europe, which will soon qualify for full membership of the Council of Europe. Bulgaria almost certainly qualifies, as it recently held elections. The Baltic states, Romania as well as Slovenia and Croatia, which we have now recognised, will also soon qualify for membership. Even Albania, which is in such desperate need of help now, will become eligible for membership.
Within the Balkans and other parts of central and eastern Europe there is growing, worrying evidence of a gradual but persistent return to old practices—hostility against minorities, conflict within states and friction, even conflict, between some of those states. It was the precise aim of the original European Community to ensure that 145 each member state had a vested interest in avoiding such conflicts. That principle must now apply throughout the continent, not just through the conference on security and co-operation in Europe, the CSCE, but through free trade. That is the only way in which democracy will succeed and human rights can be guaranteed.
The agreements are just the start. They must be extended as soon as possible.
§ Mr. Tam Dalyell (Linlithgow)
There are many political and economic matters of overwhelming importance, but I do not apologise for returning to the issue of the architectural and artistic heritage of Bohemia.
I believe that I speak for the Minister's hon. Friends, the Members for Staffordshire, South (Mr. Cormack), for Milton Keynes (Mr. I3enyon) and for Birmingham, Edgbaston (Dame J. Knight) and my hon. Friend the Member for Warley, East (Mr. Faulds) as well as for Lord Craythorne and Lady David and others who had the good fortune to go on the all-party heritage group trip to Prague for three days.
The issue relates to thefts that are occurring in the present circumstances. The Minister of State, Foreign and Commonwealth Office, the hon. and learned Member for Grantham (Mr. Hogg) has written to me about this:It is indeed ironic that the coming of democracy has brought with it regrettable incidents of this kind.The Foreign Office has confirmed that it too has evidence of thefts, particularly of wood carvings, The Minister also said:This is, of course, a matter for the Czechoslovak police, who will, no doubt, do their best to prevent thefts of this kind. But they are at present going through a major process of change.We should help them in that process of change. The Minister says that we are providing such help, but what precise help has been given and how much are we giving through the know-how fund? Comparatively small sums could do a great deal to save much of that heritage.
The Minister also noted that a police advisory team had been sent to Czechoslovakia, and said:This has been very useful and we understand that the team's recommendations are being followed up. A more efficient police force, better able to deal with criminal activities, and more publicly accountable, should be the result of the changes.Since that letter of January, has the Foreign Office monitored those changes? The Minister accepted in that letter:There are, of course, practical problems in preventing this particular kind of crime. As you say, many of the carvings are in run-down churches, often in remote areas. It would be virtually impossible for all to be protected sufficiently to prevent thefts.I recall one moving incident in Czechoslovakia when we got off our bus, suddenly and unexpectedly, and the local people locked the British parliamentarians inside the church. We were a bit surprised at that, but, on reflection, it was all too obvious that they had been subject to such raids on their own shrines on previous occasions, which they had been unable to do much about. Understandably, they were suspicious of us.
The letter goes on:The final point of control within Czechoslovakia is, of course, at the border. While border controls have been relaxed since the revolution in 1989, Czechoslovak customs officers are, I am sure, on the look-out for items of this kind.146 Given the economic circumstances of many of those customs officers, we should not be too surprised if there is often a nod and a wink. That is the point of my intervention. The Foreign Office has a moral obligation to talk seriously to the London art market—and to the art markets of Munich, Frankfurt, Hamburg, and Vienna, as well as New York and San Fransisco. If we are serious about doing something, we must ensure that considerable sums of money are not to be made out of Czechoslovakia in the fruitful western art market. I hope that the Government will do something about that.
The group had a meeting of an hour and three quarters with Mr. Dubcek, and many other meetings with Czechs and Slovaks. As one who is immersed in the problems of minorities, I think that it would be tragic if, as the hon. Member for Hampstead and Highgate (Sir G. Finsberg) said, a situation developed in which those two peoples drifted apart. No one can know the future, and the west has a moral obligation to do as much as possible to prevent that from happening.
§ Mr. Tim Rathbone (Lewes)
First, I pay a speedy tribute to my Council of Europe colleagues on both sides of the House, including the Liberal spokesman on European affairs, for their contribution to such debates, which often take place in the Council of Europe's meeting place in Strasbourg and other places. The hon. Member for Wentworth (Mr. Hardy) referred to the meeting that took place in Hungary.
Hon. Members on both sides of the House have been reticent about suggesting how much money should be spent. I shall be courageous or stupid enough to suggest a figure. Three and a half years ago, I proposed to the Council of Europe the outlines of what was loosely labelled a "Strasbourg plan". The price ticket on it was £400 billion spread over four years. The figure was not simply scratched out of the sky but was an extrapolation of what the United States gave to western Europe in far easier circumstances after the second world war in support of the Marshall plan, and I have brought it up to today's prices.
It is worth mentioning that, if only to draw to the House's attention the fact that, however much we are doing—we can be proud of what the Government are doing in support of know-how and of what the European Community is doing through PHARE—it is so small compared to what we should be doing to ensure the development of democracies and free economies in those countries. They have the knowledge and desperate desire to succeed, yet they cannot do so—not for lack of trade opportunities, although those must be given, but for lack of know-how, investment and wherewithal.
§ Mr. Christopher Gill (Ludlow)
My right hon. Friend the Minister will be aware of some of the reservations that I have expressed about how the European Community develops, but I hope that he will not be surprised to hear me welcome the association agreements with these three countries. I regard this as an important widening of the European Community. There are jolly good and sound political and strategic reasons for accommodating these three countries. It is desirable to help them towards full 147 membership. They are historically and culturally part of Europe and they are industrious nations which are by inclination capitalist.
The Minister spoke about reducing trade barriers. It is important to encourage trade, because trade rather than aid will ultimately lead to the prosperity that we want these countries to enjoy. However, we are on the horns of a dilemma, because the last thing that western Europe needs at present is more food, in which it is in surplus. There is enormous potential in those eastern European countries, but given the profit motive, modern plant and machinery and access to western technology, they will produce much more food than Europe can consume.
I understand the case for facilitating trade in agricultural products. We have to start somewhere, but as my hon. Friend the Member for Bournemouth, East (Mr. Atkinson) said, some of the industrial products of those countries are no longer in demand. For example, there is no demand for armaments. Possibly the only feasible trade that we can encourage is in agricultural products. We must not encourage additional trade in those products without paying regard to its effect upon United Kingdom farmers; nor can we ignore the legitimate concern of consumers about the health and hygiene standards applied to agricultural products from eastern Europe. Hon. Members will know that no country in Europe has the equivalent of our food safety Acts.
Help to eastern Europe cannot extend to lowering or waiving the food standards that we regard as important for the protection of our consumers. United Kingdom farmers and consumers will want the Minister's assurance that there will be a level playing field, even though we want to do all that we can to encourage trade with these nations. I trust that the Minister will assure the House that there will be no compromise on food standards.
§ Mr. Phillip Oppenheim (Amber Valley)
There has been some discussion about the non-availability of documents. However, the content of the documents and the drift of the negotiations have been widely reported for some time, and I understand that the documents were available to the Select Committee last month. To say that the documents were suddenly made available last week is not entirely accurate. It is worth reflecting on the difficulty that sometimes arises in the EC of getting documents finalised. I shall not dwell on the matter, because we are dealing with rather wider issues.
In many ways, the documents are deeply disappointing. Both Front-Bench speakers engaged in much high-sounding talk about the need for liberalisation and for trade. The documents are deeply protectionist. They show that, at the very time when eastern Europe needs to trade with us and when countries there are struggling to open their economies, to turn them into market economies and to wrench them away from the dead hand of central control and central planning, we are preaching the sort of free market policies that we are not prepared to put into practice.
We are saying that we will not open our markets to their goods for the next five to 10 years. At the end of that period, European industries and special interest groups which have pleaded so strongly for continuing trade 148 barriers will be back asking for more. Even within the limited agreements, it is not clear from the documents—but it is clear from secret agreements that have been leaked to the Financial Times—that even the goods that the eastern European countries will be allowed to sell to the European Community will be strictly limited by price support and price maintenance agreements. So those eastern European industries will not be able to undercut the industries of the EC. So much for free trade and free markets.
These documents maintain barriers against the very types of low added value, unsophisticated products that the eastern European countries could sell to western Europe: food, steel, textiles and coal. The EC, for all its benefits, has unfortunately become the prisoner of special interest groups and industrial lobbies which find access to the EC's decision-making processes far easier than do the mass of voters or those who represent wider consumer interests.
I do not blame the Government for these documents, because we had to negotiate at the EC and I know that the Government adopted a more liberal approach at the EC, but I wish that our Government had pushed a little harder. Our own Ministry of Agriculture, Fisheries and Food took a slightly disreputable stance on some issues, especially raspberries. To protect a small group of farmers in this country, strict limits were placed on imports from countries such as Czechoslovakia, Poland and Hungary.
§ Mr. Ernie Ross (Dundee, West)
When I tell the hon. Member for Tayside, North (Mr. Walker), he will be looking for you.
§ Mr. Oppenheim
I hope that the hon. Gentleman will not carry out that threat.
It is small-minded of the EC to adopt this attitude. Ultimately, it will not help us; it will raise prices in western Europe and the EC. Protection and the lack of competition will not really help these industries—they never do. Indeed, it is in the long-term economic interests of the EC to move out of precisely this type of low added value, unsophisticated industry.
There has been a great deal of talk in recent months about aid for eastern Europe. What these countries need even more than aid is the ability to trade. Unfortunately, the documents do not give them as wide an ability to trade as they really need. If, over the next few years, the slow steps towards market economies and proper democracy falter in eastern Europe, a large measure of responsibility for that will rest with the European Community and the industries which have lobbied for these protectionist measures—because they have been too small-minded at such an important juncture in the history of Europe.
§ The Parliamentary Secretary to the Ministry of Agriculture, Fisheries and Food (Mr. David Curry)
I shall deal mainly with the agricultural issue, because that seems to preoccupy Members most. If I do not have a chance to reply to all the other issues that have been raised, I shall make sure that a reply is given later—[Interruption.] I refer, for instance, to Polish visas, about which the hon. Member for Hamilton (Mr. Robertson) is muttering.
I pay tribute to my hon. Friend the Member for Hampstead and Highgate (Sir G. Finsberg) and to all hon. Members who serve on the Council of Europe for their 149 work with that body. I might be expected to sympathise with anyone who has the sense to meet in Strasbourg, given my past.
I want to address the issue head on. Agriculture is a sensitive issue. There is no point in pretending that it deals in products like any other. The Community is struggling under its heavy surpluses and heavy budgetary costs, as well as the heavy economic costs of agriculture. Member states are necessarily reticent about liberalising trade if that will have a displacement effect in increasing the costs of the policy.
The fact is that every country was involved in the agreement, one or two member states with slightly more reluctance than others. Once these products enter the Community, they circulate freely throughout it.
My hon. Friend the Member for Amber Valley (Mr. Oppenheim) mentioned raspberries, which illustrate the dilemma. We have faced a long-running problem with imports of raspberries from the countries of eastern Europe. The fruit tends to go into the processing and jamming industry. It competes with the raspberries grown on Tayside in Scotland. As a result, the industry there has found itself in severe straits. My hon. Friend the Member for Tayside, North (Mr. Walker) would endorse the remark that Mr. MacSharry has promised a structural plan for the Tayside raspberry growers, but it has been a long time coming: we are now promised it for April.
Should we say that it is best to give processors the lowest-cost raw materials, and bring in raspberries, which are then treated with some sort of preservative—they are then eventually made into jam, with the assistance of dyes to restore their red colour—or should we decide to achieve a balance between those interests and the interests of the producers in the EC, given the cost structures under which they labour?
At the end of the day, does it benefit the people in the countries of eastern Europe if they put products on the European market at prices that cannot be sustained and that do not represent a fair economic return to them? It is a genuine dilemma. It is impossible to satisfy everybody. One has to devise a mean, and that is what we have tried to do. I hope that my hon. Friends do not think that we have been too disreputable in doing that, but it is an issue that has to be tackled.
Poland, Czechoslovakia and Hungary were given reduced quotas for all the agricultural products for which they asked for concessions. The starting point was the current level. The tariff quota system means that, as the quantity rises, so the levy is reduced. The rise in quantity is 10 per cent. a year over five years—that is simple, not compound—giving a 50 per cent. improvement. The levy is reduced by 20 per cent. a year for three years, amounting to a 60 per cent. reduction.
The products most likely to be used for trading purposes are beef, sheepmeat—where there is already a voluntary restraint agreement—pigmeat, the only area where the quantities concerned start at a slightly higher level than is already being sent, poulty, where the United Kingdom already imposes fairly stringent animal health rules so that precious little poultry comes from eastern Europe at the moment, and cereals, where previously there were large exports to the German Democratic Republic. That was the magic market for products from eastern Europe, but the market has virtually disappeared.
Skimmed milk powder, butter, cheese and horticultural products are likely to reach the United Kingdom more 150 than others because of the ease of transport. The generalised scheme of preferences concessions already given to these countries cover mainly pigmeat, poultry and horticulture, and are consolidated in the agreement.
Some people ask why all this produce does not go to the former Soviet Union, since that would be by far the easiest solution. The answer is that the increase in the quota can be offset against what is called triangular trade. Some member states would like that to continue for as long as possible, because it keeps that produce away from the European marketplace.
France, Germany and the others have agreed to open their borders to agricultural produce. All the other member states have signed the association agreements. The Community is a single market. Imports crossing the frontiers can come to any member state. The Mediterranean countries are likely to have less difficulty over imports, as the hon. Member for Wentworth (Mr. Hardy) mentioned, because their products compete less with the kind of products that come from eastern Europe.
It is difficult to estimate the costs of the common agricultural policy. There are many variables. There is uncertainty about how reform of the common agricultural policy will work out. There is also uncertainty about the outcome of the GATT negotiations, and therefore about the prospects for world markets and the unit costs of export refunds—one of the essential components in determining the costs of the CAP.
There is great uncertainty over the extent to which Poland, Hungary and Czechoslovakia can maintain their traditional links with the former Soviet Union, to which a great deal of their trade was geared. On my recent visit to east Germany, I went to the Treuhand, where an attempt is being made to privatise a whole raft of companies. The great problem is that the output of many of those companies is geared towards the market in the Soviet Union which virtually ceased to exist overnight.
Collectively, the three countries produce about the same volume, in output terms, as the old West Germany. If, therefore, a substantial proportion went to European Community markets and if the unit costs of surplus disposals were not reduced, there could be a significant increase in the budgetary cost of the common agricultural policy. But "you pays your money and you takes your choice". If one chooses to liberalise and says, rightly, that a certain commodity is the one that these countries have most readily to sell to the west, that it is our duty to help them and that therefore we must accept a certain level of imports, we cannot say at the same time, "We're awfully sorry, but we must pretend that no cost is involved in doing this." That must be part of the political decision-making process.
My hon. Friend the Member for Ludlow (Mr. Gill) is concerned about health standards. I recognise that farmers say, "We're quite willing to help. We understand that health standards are needed, but will it be a level playing field? Are we going to find that cheap, nasty or unhealthy products come on to the European market while pressure is put upon us to upgrade our standards, to observe the rules and to pay the costs of upgrading those standards?" The answer, when dealing with livestock products, is that they can be shipped only from abattoirs that meet standards that have been approved by the European Community. If a product does not meet animal health rules or if there is an animal health concern such as 151 Newcastle disease in poultry or offal from eastern Europe for the pet food industry, it does not enter the United Kingdom.
Under the Food Safety Act 1990, we can inspect products as they come in from third countries, and if they present a risk they can be returned. Documentary and identity checks are made—we look in the boxes that come from third countries. Where undertakings have been given about the quality and status of the product, we shall enforce those requirements. It does importers no good if they get a reputation for sending produce that is not up to standard, any more than it does the United Kingdom any good to accept products that pose a threat to health standards. The third countries know that they must address that genuine concern.
The hon. Member for Hamilton gave us his personal memories of the Berlin wall. We all recognise that such an emotional charge is legitimate—anyone who had not faced the events of the past few years with some emotion would be less than a normal human being—but we cannot sustain the east European countries on the basis of continuing emotion. We must offer practical help that we can sustain; we must be able to afford it, or we shall end up in conflict.
The agreement is the first step towards such sustained association, eventually leading to membership. The decisions were difficult, but it is a substantial form of help. It is the most practical help, and it is to be welcomed as the first stage in eventual greater union in the EC that will embrace those countries.
§ Mr. Dalyell
Will the Minister give an undertaking to approach the arts markets in relation to the Bohemian carvings?
§ Mr. Curry
If the Ministry of Agriculture, Fisheries and Food were to approach the arts markets, they would 152 regard it with a certain curiosity. My right hon. Friend the Minister of State, Foreign and Commonwealth Office has heard what the hon. Gentleman said, and no doubt he will wish to take his suggestion to heart.
§ Question put and agreed to.
That this House takes note of the proposals described in the unnumbered Explanatory Memorandum submitted by the Foreign and Commonwealth Office on 29th November 1991, relating to Association Agreements between the Community and its Member States and Poland, Hungary and Czechoslovakia, and European Community Document No. 10561/91, relating to interim agreements between the Community and Poland, Hungary and Czechoslovakia; welcomes the principle of Association Agreements between the European Community and the reforming democracies of Poland, Hungary and Czechoslovakia; recognises that these Agreements will offer them substantial benefits by encouraging trade with the Community, enhancing political co-operation, and strengthening links with the European Community to which these countries have expressed a wish to accede; and looks forward to early ratification of the Agreements.