TREATY ON EUROPEAN UNION (Hansard, 4 February 1993)

§ Mr. Nigel Spearing (Newham, South)
On a point of order, Mr. Morris. You may be aware that the votes at the close of proceedings in Committee last week gave rise to much mystification about what is afoot which has also been expressed in circles outside the House, particularly among those who only occasionally sit in on or view our proceedings. I think, and hope that you will be able to confirm, that the difficulties that arise are not due to the proceedings of the Committee and are not within the discretion of the Chair. They arise from the brevity of the Bill, and the length and complexity of the treaty that we are considering, which amends another treaty in order to form yet a third treaty that we have not seen. Difficulties are caused by the large number of amendments that can be tabled, a combination of votes on closures, suspensions of the rules and procedural questions that are not substantive.
In future, to make things more difficult, we face the prospect of votes on substantive questions that have already been debated—the time of the decision and the vote may be separated by several weeks. If you, with your knowledge as the Chair, can confirm those facts, it might help you and the Committee. The problems we face relate not to the proceedings as set out in the Order Paper or your discretion, but to the nature of the Bill and the treaties.
A few sittings ago, Mr. Morris, you kindly said that you and your Chairmen's Panel would consider the possibility of marking new amendments selected for debate on the informal circulation of provisional selections. You said that consultation would be needed, which we understand. You will know that it is not unknown in Committee for the Chair to draw to the attention of the Committee additional amendments of particular importance—indeed, any that have been added to the amendment paper.
In the light of that semi-precedent, I was wondering whether you would consider whether, at the beginning of every sitting after today's—I think that we are to have a short break—you could announce verbally any additional amendments that you have selected since the informal selection. That would greatly assist members of the Committee, even those who have been Members of Parliament for some time. I am not asking for a ruling now, but I hope that you will consider the matter in the next day or two.

§ The Chairman of Ways and Means (Mr. Michael Morris)
As I understand it, the Committee is to be given a week off, and I shall seriously consider the points made by the hon. Gentleman. I think that there is some merit in his latter point. On the earlier issue that he raised, he was right to say that the Chair is constrained by the rules of 502 Committee procedure. The only addition that I can make to the comments of the hon. Gentleman is that we have spent more than five hours on points of order, which have not been totally productive.

§ Mr. Nicholas Budgen (Wolverhampton, South-West)
On a point of order, Mr. Morris. I hope to spread an atmosphere of good will and consensus. An unpleasant suspicion has arisen—which I have tried to banish from my mind—that our proceedings have been conducted by a conspiracy between the two Front-Bench teams, to the exclusion of many other hon. Members.
May I make a suggestion? It is obvious that the Government are not now as urgent in their desire to get the matter dealt with by the House as was apparent at one stage, and a large number of hon. Members from the regions, and especially from Northern Ireland, wish to discuss the matter fully. Rather than having a conspiracy between those in power who try to control the proceedings, perhaps it could be announced at this stage that consideration of this part of the Bill will continue no later than 10 o'clock tonight.
That will be for the convenience of the House. It will also enable those who live in the regions of the United Kingdom—

§ Mr. George Foulkes (Carrick, Cumnock and Doon Valley)
And the other nations of the United Kingdom.

§ Mr. Budgen
However they may be described, the Committee will not be run in an aggressive English way which makes them feel that their contributions cannot properly be heard at a convenient time.

§ The Chairman
I am most grateful for the harmonious way in which the hon. Gentleman has raised the point of order. Of course, the point he makes has absolutely nothing to do with the Chair.

§ Mr. David Trimble (Upper Bann)
Further to that point of order, Mr. Morris. As you can see, the amendments selected for discussion today dealing with the Committee for the Regions and the cohesion fund are matters in which hon. Members representing Northern Ireland constituencies have a very keen interest. The cohesion fund will pour billions of pounds into our near neighbour and aid its competitive position and disadvantage us, so many hon. Members representing Northern Ireland constituencies are anxious to participate in the debate at a civilised hour. We have obligations some distance away and travel is difficult between here and Northern Ireland.
It may not be entirely within your control, Mr. Morris, but we would be very glad if proceedings could he conducted at a civilised hour, and, if that is not possible today, that the amendment be carried over for debate when we return to the issue.

§ The Chairman
I share the hon. Gentleman's views about civilised hours. I was aware that hon. Members from the Province were likely to wish to catch my eye, so the sooner we get on with the job, the sooner they will be successful.

§ Mr. Michael Alison (Selby)
Further to that point of order, Mr. Morris. In view of the interesting suggestion made by my hon. Friend the Member for Wolverhampton, South-West (Mr. Budgen) that a large number of colleagues from all parts of the House, particularly from Northern Ireland, might want to speak, and that 503 proceedings should perhaps be terminated at 10 o'clock tonight, will you consider the possibility of putting a limit of 10 minutes on speeches after 6 o'clock?

§ The Chairman
That would have to be a voluntary limit, but it has much to commend it.

§ Mr. David Winnick (Walsall, North)
Further to that point of order, Mr. Morris. I recognise that we are in Committee, but as you will know, there has been a good deal of informal discussion and debate on what is known as the Jopling report, which expresses the view of a number of Members about the hours that the House sits and the general desire that it should not go beyond 10 o'clock. Bearing in mind the fact that we are in Committee, would it not be useful if hon. Members knew in advance whether or not we would sit beyond 10 o'clock?
At present, no information is given—I assume that that applies to both sides of the Committee—and we do not know whether we shall sit beyond 10 o'clock depending on whether the Government decide to move the necessary business motion at 10 o'clock and whether they get a majority. It is a rather odd and unfortunate way of proceeding, and I wonder whether you could advise us accordingly.

§ The Chairman
It is not for me to advise, as I know no more than the hon. Gentleman.

§ The Minister of State, Foreign and Commonwealth Office (Mr. Tristan Garel-Jones)
Further to that point of order, Mr. Morris. I refer to the point of order made by my hon. Friend the Member for Wolverhampton, South-West (Mr. Budgen) and make my point in the same spirit as he made his. We all appreciate his anxiety to return to his constituency this evening. He is very conscientious about that, but it should be placed on the record that the only conspiracy of which I am aware is between my hon. Friend the Member for Wolverhampton, South-West and Opposition Members such as the hon. Member for Newham, South (Mr. Spearing).

§ Mr. Tony Marlow (Northampton, North)
On a point of order, Mr. Morris. I am sorry about my right hon. Friend's intervention, because it is my intention to add to the good will and harmony. As you know, Mr. Morris, one of the most important issues we are debating today is the cohesion fund. The House will take a decision today on whether we want to include the cohesion fund in the Bill.
Imagine my consternation and surprise when I discovered that the European Commission has drafted a regulation on the basis of the cohesion fund without knowing whether the House would accept it. You are a man of great personality and influence, Mr. Morris, and I wonder whether, on behalf of the House, you could get in touch with the European institutions and ask them to delay taking those initiatives until the House has taken its decision.

§ The Chairman
I have a full-time job dealing with the Committee, and it is certainly not my job to contact the Commission.

§ Sir Russell Johnston (Inverness, Nairn and Lochaber)
On a point of order, Mr. Morris. I refer to the point of order raised by the right hon. Member for Selby (Mr. Alison) and I should like to ask, first, whether the 504 10-minute rule has ever been applied to a Committee of the whole House; and, secondly, whether it can be applied in that way.

§ The Chairman
I regret to say that it cannot be applied; therefore, it is a voluntary rule. However, the list of hon. Members who have contributed to the debate includes some who have made most powerful and persuasive speeches in 10, 11 or 12 minutes which read exceedingly well, while some have taken several hours and are rather difficult to follow when read afterwards.

§ Mr. Trimble
rose—

§ The Chairman
I hope that it is a new point of order, as the hon. Gentleman made a plea that he wanted to get cracking.

§ Mr. Nicholas Winterton (Macclesfield)
Further to the points of order which have been raised with such good humour and sense this afternoon, Mr. Morris. The groups of amendments that we are to consider this afternoon, and hopefully on another occasion when we consider the Bill, have a fundamental impact on the country. You will be aware that one or two major companies such as Leyland DAF, which was the subject of a statement in the House, have gone into administrative receivership and that therefore employment in some of the basic industries—

§ The Chairman
Order. The hon. Gentleman has been in the House a long time. He is a member of the Chairmen's Panel and he should know that he should put a specific question to the Chair and not adduce an argument.

§ Mr. Winterton
I am seeking briefly, and in the same vein as my hon. Friend the Member for Wolverhampton, South-West (Mr. Budgen), your advice and support for the views that have been put forward by hon. Members from all sides of the House about the importance of the group of amendments and the need to ensure that hon. Members from all parts of the United Kingdom participate because all parts of the United Kingdom are influenced. I make my plea at this early stage that such an important debate should continue into a second day.

§ The Chairman
The hon. Gentleman did not define a day in the first place, and his argument had already been put.

§ Mr. Trimble
rose—

§ The Chairman
Is this a new point of order?

§ Mr. Trimble
Yes. I am sorry to try your patience on this matter, Mr. Morris, but it has just been drawn to my attention—perhaps this is evidence of the conspiracy the Minister thinks does not exist—that, if the Committee were sitting upstairs, we would know in advance what the timing was. Perhaps it might be a good idea if some similar arrangment could be adopted here.

§ The Chairman
I am not sure which hon. Gentleman pointed that out, but it was not totally accurate information.

§ Rev. Ian Paisley (Antrim, North)
On a point of order, Mr. Morris. As has already been said by my hon. Friend the Member for Upper Bann (Mr. Trimble), the debate on the cohesion fund is important to all parts of the United Kingdom, particularly to Northern Ireland, which will be very badly treated. The southern Irish will receive between 505 £3 million and £6 million, while we will be left out altogether. Can you assure me that, for the first time, you will favour some hon. Members representing Northern Ireland, and myself particularly, and call them to speak to the Committee?

§ The Chairman
Special pleading falls on deaf ears, but I recognise the importance of all parts of the United Kingdom.

§ Mr. Roger Knapman (Stroud)
On a point of order, Mr. Morris. Bearing in mind all that has been said and the difficulties of hon. Members from all parts of the United Kingdom who wish to speak, and bearing in mind the fact that, during debate on the Single European Act, the average number of amendments was three whereas in this instance we have 27 amendments and six new clauses, would it be helpful and convenient—

§ The Chairman
Order. The hon. Gentleman raised that point of order at our last sitting, and I pointed out to him then that his submission was not accurate. Frankly, it is no more accurate today than it was on Monday.

§ Mr. Knapman
Yes, Mr. Moris, but on that occasion, although the point of order was similar, there were 12 amendments grouped together, whereas on this occasion—

§ The Chairman
Order. I made it clear to the hon. Gentleman that the number of amendments was totally irrelevant. There can be two or three; there can be 20 or 40. The number of amendments is irrelevant to the length of time that we debate an issue. My job is to ensure that we have a full and fair debate on the totality of such amendments as are down for selection on the day.
Without further ado, therefore, we come to amendment No. 13.

§ Dr. John Cunningham (Copeland)
I beg to move amendment No. 13, in page 1, line 9, after 'II', insert '(except Title XIV on pages 36 and 37 of Cm 1934)'.

§ The Chairman
With this, it will be convenient also to discuss the following: Amendment No. 28, in page 1, line 9, after 'II', insert
'(provided that in the implementation of Articles 198(a), (b) and (c) on pages 54 and 55 of Cm 1934 concerning the Committee of the Regions, the 24 members and 24 alternate members of that Committee shall be drawn from elected local government representatives.)'.

§ Dr. Cunningham
I say at the very beginning that amendment No. 13 is a probing amendment. It would remove title XIV from the treaty. Title XIV refers to economic and social cohesion in the Community. We are supporters of the principle of policies to move to economic and social cohesion, and it is exactly because of the importance and sensitivity of these issues that we have tabled this amendment to enable a debate to take place.
508 I share the point of view expressed by the hon. Member for Upper Bann (Mr. Trimble)—and others, for that matter—that, regardless of the number of amendments on the amendment paper, there is an important series of issues in this group of amendments. Far from there being any conspiracy—it is difficult for me to conceive of the ability to have a conspiracy with Ministers when we can barely believe a word they tell us about the proceedings on this Bill, and to construct a conspiracy in those circumstances is almost impossible—we are no more enlightened about the Government's intentions on closure motions or 10 o'clock rule motions than is anyone else. In case anyone is in any doubt, however, let me say that if the 10 o'clock motion is moved tonight we shall oppose it exactly because we believe that the House as a whole will want a significant amount of time to discuss the cohesion fund and the Committee of the Regions, which is the subject of amendment No. 28.

§ Mr. Marlow
rose—

§ Dr. Cunningham
I will give way in a moment. This amendment, also tabled in my name and those of my right hon. and hon. Friends, refers to chapter 4 of the treaty which establishes the Committee of the Regions. It is to amendment No. 28 that I shall address myself in the course of what I hope will be a relatively brief contribution.

§ Mr. Marlow
I am sorry to learn that the hon. Member for Copeland (Dr. Cunningham) does not know when the Government are going to have their procedural motions, particularly as we all know that the Liberal party does know. The hon. Gentleman has said that he is in favour of the cohesion fund. Does he realise that we pay for it but that other people get the money?

§ Dr. Cunningham
Yes, of course 1 realise that simple fact, but perhaps I can observe in response to the hon. Member for Northampton, North (Mr. Marlow) that if the Government he wholeheartedly supports in other policies continue to wreck the British economy in the way that they are currently doing, Britain will soon be able to benefit from the provisions of the cohesion fund. Indeed, in a technical sense, sad to say, because of high levels of unemployment in Merseyside, Tyneside and elsewhere, some regions or sub-regions of Britain would already qualify for benefit from the provisions of the fund.
I want to discuss the important principle set out in amendment No. 28, referring to chapter 4 of the treaty and the Committee of the Regions. Articles 198a, 198b and 198c set out the duties of the committee and its relationship to the Council of Ministers and to the Commission. The Maastricht treaty recognises in two key ways the increasing role for the regions of the Community: first, the establishment of this important committee, and, secondly, the subsidiarity principle included in the treaty. Subsidiarity, however, is the subject of a later debate in our proceedings.
It is a general observation and widely recognised throughout the European Community that decentralisation, devolution, the sharing of power and decision-taking have worked well for almost all the major countries of the Community and for their economies. Only in Britain has there been a blind drive towards greater and greater centralisation of decision-taking in the past decade or more. Only in Britain have we had a Government who, far from wanting to devolve power and share decision-taking, 509 have given Ministers more and more central and authoritarian powers, including powers over democratically elected local government. Only in Britain have we had a Government who, by Act of Parliament, have struck out what were existing important elected authorities such as the Greater London Council and the metropolitan authorities of England. Only in Britain do we have a capital city with no authority elected to represent its citizens and their views—and we see daily the damage that this has done to the interests of the city and people of London.
In Spain, autonomous provinces with varying powers have been an engine of Spain's economic growth. In France, economic revival has coincided with the abandonment of the traditional French attitude to central control. In Germany, the Lander have long been recognised as key ingredients of German success. In Belgium and elsewhere, devolved power operates beneficially and successfully in economic and social policy. In relation to other countries and the Committee of the Regions, there have been varying representations. Other countries have taken varying views, but only in Britain has there been the suggestion that the Committee of the Regions may perhaps comprise non-elected, nonrepresentative ministerial appointees. Whatever the devolved arrangements, whatever the constitutional form, in all the other countries of the Community the principle, at least, has been established and accepted that nominations to the Committee of the Regions will be from some level of elected representatives.
We believe that it is very important that the same principle should apply for Scotland, for Wales and for England and that the same principle should apply for Northern Ireland, too.

§ Dame Elaine Kellett-Bowman (Lancaster)
Is the hon. Member suggesting that Derek Hatton, for example, would be more capable of representing Liverpool than, say, Bishop Sheppard or Archbishop Worlock?

§ Dr. Cunningham
The hon. Lady could not have been listening carefully. I was talking about elected representatives. It is quite some time since Mr. Hatton enjoyed the status of elected representative. If the hon. Lady wishes to get into that kind of political approach to the debate today, she had better look a little closer to home and direct her attention to the stench which has been hanging around the Tory administration in the City of Westminster for a very long time indeed. She is in no position to make allegations about Labour when there are so many Tory authorities that I could name when it comes to matters of that kind.

§ Mr. Stuart Randall (Kingston upon Hull, West)
Is my hon. Friend aware that West Wiltshire district council, a Tory-controlled council, has been involved in such corruption that the police have now been called in and Tory councillors have had to resign their seats because of the appalling administration of that particular Conservative council?

§ The Chairman
Order. That is one from both sides. I do not think that the Committee ought to get into local government difficulties now.

§ Dr. Cunningham
We had better decide to play a draw, Mr. Morris; otherwise, this could be an extended debate.
510 Sadly, there are examples in all political parties of the kind that the hon. Lady wrongfully and unhelpfully introduced. That subject was not one that I intended to touch on.

§ Mr. Alex Salmond (Banff and Buchan)
Many of us believe that it is paramount that representatives are not nominated by central Government. As to the United Kingdom's representatives, has the Labour party come to a view as to how many of them should be allocated to the nations of Scotland, Northern Ireland and Wales?

§ Dr. Cunningham
We have not come to a view, but some of our representatives in local government have; in fact, I believe that they take several views—certainly more than one.
Today, we want to establish the agreement of the Committee to the principle that I described. We can discuss the details of allocation later. I have no doubt that those discussions may be heated within parties as well as between parties. I do not disguise that reality for a moment. The purpose of the amendment is to persuade the Government—I believe that all other parties in the Committee have done this—to accept the principle that the amendment seeks to establish.
Since the original signing of the treaty, Ministers have made some very odd statements. At one point, it seemed that the Secretary of State for Wales intended to appoint himself to the committee.

§ Mr. Garel-Jones
What a good idea.

§ Dr. Cunningham
That is a matter of opinion—as ever, when the Minister of State speaks.
If the Secretary of State were to represent the United Kingdom in the Council of Ministers—as he is entitled to do, as a Minister—he should not be entitled also to take a place on the Committee of the Regions. That would be contrary to the spirit and the letter of the treaty.

§ Mr. Giles Radice (Durham, North)
Can my hon. Friend say whether any other country is considering nominating a Minister to represent one of its regions?

§ Dr. Cunningham
As of now, we know of no such example. I am not saying that another member state may not make such a proposal, but we think it unlikely. All the indications from those countries which have declared their intentions rule out the appointment of national Ministers to the committee.
The Government again seem to have set off on the wrong road, as they so often do. It may be that they have drawn back from their earlier position and that common sense and persuasive argument have prevailed. There is always a first time, even with a Government as pig-headed and obstinate as the present Government. We hope that is the case. The Government, in the form not only of the Secretary of State for Wales but of the Secretary of State for Scotland, have made statements about Ministers putting their nominees on the Committee of the Regions. We reject that approach because, I repeat, it is contrary to the spirit and the letter of the treaty. We hope that the Minister of State will be able to assure the Committee that the Government have had second thoughts, and we hope even more strongly that he will indicate that they are prepared to accept our amendment.

§ Rev. Martin Smyth (Belfast, South)
Does the hon. Gentleman agree that his argument is even more true of Northern Ireland as not one Minister in the Northern 511 Ireland Office was elected by any Northern Ireland constituency, so such an appointment to the Committee of the Regions would in no way be representative of the people of Northern Ireland.

§ Dr. Cunningham
I accept absolutely the hon. Gentleman's point. I intended to make the same point about the Secretary of State for Wales, who has no personal mandate in Wales—certainly his party does not have one. The Secretary of State for Scotland has a personal mandate, but he cannot claim that his party has a mandate in Scotland. To make such appointments would fly in the face of the wishes and decisions of the electorates of Northern Ireland, the Principality, and Scotland. That is why we reject the approach that the Government are apparently taking to the Committee.
5.15 pm
Last week, I read with amusement a statement which was repeated at Prime Minister's Question Time today —that the Government are to have a bonfire of controls. They have already had at least two bonfires that I can recall during their tenure of office, so where are the other controls to come from? They will come from the legislation that the Government have heaped on our country over the years. If Ministers intend to follow that course of action, which is usually just a smokescreen to hide other difficulties—in this case, the disastrous state of the economy—I encourage them to apply the same bonfire principle to controls on local government as to controls on industry.
No aspect of our national life has been more subject to a tidal wave of legislation and controls than local government the length and breadth of our country. It has suffered 60 Acts of Parliament which have hedged around and circumscribed local authorities with more and more authoritarianism. The Community and local government associations in Britain, regardless of political control, are almost unanimously in favour of accepting the principle embodied in the amendment applying to the Committee of the Regions—that it should be made up of members of elected local authorities.
Those in favour of that principle include the Council of European Municipalities and Regions, the Consultative Council of Regional and Local Authorities in Europe, and the Standing Conference of Local and Regional Authorities of Europe—which is a Council of Europe body. Britain will be in an anomalous situation if Ministers do not accept our amendment.

§ Mrs. Gwyneth Dunwoody (Crewe and Nantwich)
My hon. Friend's powerful case is, I am sure, strongly supported by right hon. and hon. Members from the regions. If the Government do not accept the amendment, does my hon. Friend intend to press it to a Division?

§ Dr. Cunningham
Yes.

§ Mrs. Edwina Currie (Derbyshire, South)
Poor man.

§ Dr. Cunningham
The hon. Lady is apparently amused. I do not know whether she is surprised or astonished, but we have every intention of pressing the amendment to a Division. I dare say that the smile will be wiped off the hon. Lady's face because we expect that, if the Government do not accept the amendment, a great number of hon.
512 Members from minority parties will vote with us and against the Government. For someone who is a self-professed, pro-European, and anxious to get to Europe, the hon. Lady displays a disarmingly candid view —one that is in opposition to that which is widely shared in the Community.

§ Mr. Radice
My hon. Friend might care to ask whether the so-called pro-Maastricht Conservative Members will support this important part of the Maastricht treaty with their votes tonight.

§ Dr. Cunningham
We shall not be voting on the substance of the amendment tonight, but the hon. Members to whom my hon. Friend refers could join us in opposing the motion to suspend the 10 o'clock rule, thus ensuring the widest possible debate on this important nexus of issues.
Local government in Britain has made various proposals. This relates to the point made a few moments ago by the hon. Member for Banff and Buchan (Mr. Salmond). I am not here to adjudicate between those detailed submissions, but I know that the Government have received one such submission on behalf of the local authorities, to which, so far as I am aware, they have made no response—certainly no public response.
We should value the regional and local democratic mandate of those who are to comprise the committee. We should recognise their knowledge and expertise in regional and local government. We should acknowledge that local authorities of all political persuasions have a duty to implement European Community directives, and to monitor and supervise other aspects of European Community decisions. To use a well-worn if not hackneyed phrase, locally elected members are at the sharp end of the implementation of the overwhelming majority of European Community directives and other decisions in their own communities and localities. They therefore have a firm grasp of the implications of European Community legislation and EC decisions generally—for instance, in regard to the environment—and will bring a powerful voice to deliberations on the Community's future, including the nature and content of its legislation.
The Committee of the Regions is intended to introduce such a new dimension to the Community's affairs, and it is a very welcome aspect of the treaty. Acceptance of the amendment would mean that the House and the Government had agreed the principle that I have sought to highlight. I repeat that discussions on the allocation of places between Scotland, Wales, England and Northern Ireland could subsequently take place.
I commend the amendment to the Committee.

§ The Minister of State, Foreign and Commonwealth Office (Mr. Tristan Garel-Jones)
I hope that it will be convenient if I make some opening remarks at this stage. I dare say that the debate will run for a number of hours, and, if I am fortunate enough to catch your eye later, Mr. Morris, I shall try to answer the points that have been raised in the intervening time.
I am grateful to the hon. Member for Copeland (Dr. Cunningham)—as, I am sure, are other hon. Members —for telling the Committee that he does not intend to press amendment No. 13 to a Division. That has yet again given us an opportunity to discuss not only the whole subject of cohesion, which the hon. Gentleman did not mention, but the Committee of the Regions. I hope that it 513 is in order for me to make a few remarks about amendment No. 13, although the hon. Gentleman did not refer to it. I suspect that hon. Members on both sides of the Committee may wish to touch on it.
The Committee will probably recall that the Community's commitment to assist the less-developed regions dates back to 1975, and the creation of the European regional development fund. The specific objective of reducing economic disparities between regions of the Community—which, in Eurospeak, is known as "economic and social cohesion"—first appeared in the treaty with the Single European Act 1986, which added five new articles to the treaty of Rome: articles I 30a to 130e. Those articles specified that the main instruments of cohesion would be the structural funds and the European investment bank.
The Maastricht treaty seeks to build on the articles in the Single European Act, first, by stating that European Community policies and actions must take cohesion into account—although that is not a sweeping provision designed to ensure that all EC actions are subordinated to the objective of cohesion: other treaty provisions must be taken in their context. The cohesion fund legislation must be agreed unanimously by member states, after obtaining the assent of the European Parliament.
Secondly, the Maastricht treaty allows the Commission to propose specific actions outside the funds if necessary, although such proposals would have to be agreed on their merits by the Council, again by unanimity. There is no question of the United Kingdom, or indeed any other Government, being forced to accept proposals that they find unacceptable.
Thirdly, the treaty provides for the establishment, by the end of 1993-again, by unanimity in the Council—of a cohesion fund, which will seek to target assistance on the four poorest member states, Spain, Portugal, Ireland and Greece, for projects relating to environment and trans-European networks. Finally, it is provided in the cohesion protocol annexed to the treaty that assistance from the cohesion fund will be made available only to member states which have a per capita income less than 90 per cent. of the Community average, and which are implementing sound macro-economic policies designed to attain the targets agreed in their convergence programmes with the Community.
I hope that the Committee will agree that the Maastricht treaty does indeed strengthen and improve the existing cohesion articles in the original treaty—above all, by targeting the Community's cohesion effort where it is most needed.
The Committee will not need reminding that the Maastricht treaty says nothing about the level of cohesion spending; that was for decision in the future financing review, which we concluded at the Edinburgh European Council meeting in December. Hon. Members will recall that the overall settlement agreed at Edinburgh was rather restrictive, raising the own-resources ceiling by less than half the increase originally asked for by the Commission. Despite that, the increases in cohesion spending were in our view generous, reflecting the new emphasis that the Community is placing on this objective.

§ Mr. Marlow
My right hon. Friend has said, effectively, that we have a lock on it, because it depends on unanimity, and we can be very careful about how the fund is established and what it is spent on. I remind him that 514 article 130a states that the aim of economic and social cohesion is, as he said, to reduce disparities. If we ratify this particular part of the treaty, we shall commit ourselves to attaining the objectives set out in article 130a, and the Community's policies and actions must follow that. We are actually committing ourselves, if we accept this, to reducing disparities through a cohesion fund which will obviously take up a lot of money.
My right hon. Friend will be aware that the draft regulation put out by the Commission, on behalf of the Commission, wants the Commission to control the funds without any further intervention from the Council. May I suggest that we would be better off without the cohesion fund? It will cost our taxpayers money, and provide nothing for them. I suggest that my right hon. Friend's Conservative colleagues would do well to support the amendment moved by the hon. Member for Copeland (Dr. Cunningham).

§ Mr. Garel-Jones
I do not agree. Cohesion is one of the instruments available to the Community in the pursuit of its objectives, and cohesion is one of the Community's objectives. I remind my hon. Friend, however, that the Maastricht treaty is littered with new references to the importance of markets and sound economic policies. My hon. Friend has asked what Britain will get out of the arrangement. I am sure that he needs no reminding that, with the single market now available to us, we in Britain have the good fortune of having more major international and transnational companies than any other country in the Community. Our international insurance and chemical companies are moving into European markets on a much larger scale than any other country in the Community, which is proving enormously beneficial to the United Kingdom. It is part of the whole single market package.

§ Mr. Ian Taylor (Esher)
Can my right hon. Friend confirm that the change to the cohesion fund made in the Maastricht treaty is the inclusion of rural areas? It is an extremely good thing, and would it not be rather strange if the Opposition wanted to delete rural areas from the cohesion fund package merely because they might not obtain many votes there?

§ Mr. Garel-Jones
I agree, but I must say that the hon. Member for Copeland has made it clear that he does not intend to press the amendment so we cannot accuse the Opposition of wishing to remove rural areas from the fund. They are providing an opportunity for us to debate these matters.

§ Mr. Peter Shore (Bethnal Green and Stepney)
rose—

§ Mr. John D. Taylor (Strangford)
rose—

§ Mr. Garel-Jones
I shall give way to the right hon. Member for Bethnal Green and Stepney (Mr. Shore). One of the reasons I want to be brief is that a number of hon. Members from Northern Ireland and other parts of the country will want to catch your eye as early as possible, Mr. Lofthouse. I want to ensure that I do not detain the Committee for too long so that they may do so.

§ Mr. Shore
I am very much in favour of regional funds, provided that they are spent and targeted sensibly. Can the Minister explain why the criterion for the new cohesion fund was a percentage of the Community's average GDP 515 instead of the fund targeting particular regions which fell below the 90 per cent. threshold? Surely that would have been a more intelligent way to proceed. I should be grateful for the Minister's explanation of why the national measure was adopted.

§ Mr. Garel-Jones
The Community has two instruments for that purpose. One is the structural funds which are specially aimed at regions and from which the United Kingdom benefits. The new cohesion fund relates to per capita income, meaning that it is devoted specifically to the four poorest countries in the Community. It was part of the bargain struck at Maastricht that the funds should be devoted—[Interruption.] Yes, it was a bargain. The hon. Member for Crewe and Nantwich (Mrs. Dunwoody) will be aware that sensible bargains, arrived at by consensus between grown-up people, happen to be part of the profession to which she and I belong. That is what we do as politicians. I do not think that any Government in the Community, whether those at the top or bottom of the per capita income scale, need to apologise for arriving at sensible bargains between nation states.

§ Mr. John D. Taylor
rose—

§ Mr. Garel-Jones
I must make progress. May I finish this point?
I repeat that the four poorest member states in the Community argue with some fairness that certain member states, largely those in the north of Europe—we are an example of this—which have highly developed world-beating multinational companies, are taking enormous advantage of the single market by investing in their countries and by buying into the insurance, food and chemical industries in their countries. The trans-European networks, for example, which seek to improve communications—in Greece, Ireland, Spain and Portugal in the case of the cohesion fund—are of enormous benefit to countries that are fortunate enough to have such enterprises. Therefore, the bargains work both ways. It is not a crude case, as some hon. Members have implied, of British taxpayers pouring money into roads in Greece with no benefit to Britain. That is a travesty of reality.

§ Mr. John D. Taylor
The Minister was right to express some satisfaction at the outcome of the Edinburgh summit where, as he said, the increase in the budget ceiling was not as great as had originally been requested. It was only about half of that. However, will he define more clearly how much of that increase is being allocated to the cohesion fund as it has not been made very clear?

§ Mr. Garel-Jones
I think I am right in saying—although if I am lucky enough to catch your eye later, Mr. Lofthouse, I can correct this if necessary—that the cohesion fund which, as the right hon. Gentleman knows, applies only to the four poorest countries is likely in 1993 to represent about 7 per cent. of the total cohesion effort. That would include the regional funds in which he is especially interested. By 1999 the total cohesion effort, including the structural funds, will represent about 8.7 per cent. of the total spent.

§ Mr. Peter Mandelson (Hartlepool)
rose—

§ Sir Russell Johnston
rose—

§ Mr. Garel-Jones
I shall give way to both hon. Members but then I must make some progress.

§ Sir Russell Johnston
I am grateful to the Minister for giving way because I know that he wants to make progress. He is perfectly correct to check the hon. Member for Northampton, North (Mr. Marlow)—and the more he does so the better in my view—but does he agree that it is not merely a question of Britain deriving commercial advantage from the cohesion and structural funds? We are also accepting the principle that all in the Community have some responsibility for the deprived areas, wherever they may be.

§ Mr. Garel-Jones
I very much agree. I should have said that about the structural funds in my reply to the right hon. Member for Strangford (Mr. Taylor): For last year the United Kingdom will receive about £1 billion from the structural funds. Northern Ireland is a substantial and wholly proper beneficiary of that money.

§ Mr. Mandelson
I do not want to disappoint some of my hon. Friends but I also want to express support for an important principle of the cohesion fund—that of solidarity with countries poorer than us. The basis of the deal that the right hon. Gentleman described includes both funds. Under the Delors 2 proposals there is to be an increase in the structural funds in support of objective 2 regions, those which have old industries which need restructuring. That support, including some for the north of England, is proposed to increase by two thirds by 1997. Will the British Government support those proposals, which are central to the operation of the structural fund and the deal struck between Governments?

§ Mr. Garel-Jones
Yes, of course, but we are now entering the stage where member states bid for the structural funds. We are at the moment in the process of putting together the bids that we shall be making for the various regions. That will take place this year. Naturally, the British Government intend that the regions in Britain which now benefit from a particular status will continue to do so, and we shall be trying to achieve a better status for some areas—for example, the highlands and islands.

§ Rev. Ian Paisley
rose—

§ Mr. Garel-Jones
I wish to make progress so that the hon. Member for Antrim, North (Rev. Ian Paisley) is able to speak later. I want to talk about the Committee of the Regions on which the hon. Member for Copeland concentrated.
The Government welcome the establishment of the Committee of the Regions. There is a wide range of Community policies which attract regional and local interest, either directly or indirectly. We therefore think it absolutely right that there should be an input into the Community's decision-making process from the regions.
The treaty establishes that the Committee of the Regions will have an advisory status. It must be consulted on new proposals on matters such as education, culture, public health, cohesion and trans-European networks. It may also be consulted in any other instance which is considered appropriate or—this is important, too—it may issue an opinion on its own authority where regional interests are involved.
The treaty provides that the committee will be made up of representatives of regional and local bodies appointed 517 to serve for four years. The treaty makes it clear that it is for the Governments of member states to nominate their national candidates to the committee. It is left to the member states to decide how their seats should be allocated between their regions and what representatives should he nominated. The amendment would commit the Government to ensure that all United Kingdom nominees to the Committee of the Regions will be elected local government representatives.

§ Dame Elaine Kellett-Bowman
I represent the part of the north-west that is very far from the centre. We would be most apprehensive if the major part of representation on such a regional body were to come, as it inevitably would, from Liverpool and Manchester. We would not trust our fate in their hands.

§ Mr. Garel-Jones
My hon. Friend makes a point that I shall seek to develop in a moment.
There are many reasons why I shall invite the Committee to reject the amendment. Among those reasons is that the hon. Member for Copeland implied that it was within the spirit of the treaty that every representative should be an elected local government representative and that the United Kingdom would in some way be failing in its duty and not living up to the spirit of the treaty if every member were not an elected member.
So far, two countries have nominated their candidates for the committee—Greece and the Netherlands—and they are good examples because they are two completely different countries. One is a southern Mediterranean cohesion country and the other is a northern, rather rich, sophisticated country. The Greeks have nominated eight elected mayors and four non-elected regional secretaries, and five elected and seven non-elected representatives is what the Netherlands has done. I make that point because I do not think that it is necessary that there be an obligation on any Government to ensure that all the nominees are from local government.

Several hon. Members
rose—

§ Mr. Garel-Jones
Let me finish developing this point and I shall give way.
We have 24 seats and 24 alternates. In order properly to reflect and represent all the various subtle interests, not just local government interests—

Several hon. Members
rose—

§ Mr. Rhodri Morgan (Cardiff, West)
Is the right Iron. Gentleman giving way?

§ Mr. Garel-Jones
I am taking careful note. If I may develop my point, I shall then give way.
There are a range of national, regional and cultural interests of some importance and consequence that would not necessarily be adequately represented if we chose to go down the rather crude route that the hon. Member for Copeland is suggesting—a route which, so far, every member state that has chosen its members has not chosen to go down.

§ Dr. Cunningham
The Minister is giving a completely different interpretation to the meaning of the treaty from that which Mr. Delors gave. In a letter in December, on behalf of the Commission, he said: The Commission is of the opinion that, considering the functions attributed to the Committee of the Regions, the Committee should consist of elected representatives.

§ Mr. Garel-Jones
I remind the hon. Gentleman that Mr. Delors is not a party to the treaty. It is a treaty between member states. He is perfectly entitled to his opinion, and it is not an unimportant opinion. So far, two member states, not noted for their lack of solidarity or for their lack of commitment to the Community, have decided not to go down the route that the hon. Gentleman is recommending.

§ Mr. Bernard Jenkin (Colchester, North)
Once again, does it not appear that we have a clash between what the Government claim to be the intention of the Committee of the Regions in having those clauses in the treaty and what the real architects of the European union conceived? We are building yet another treaty basis for Brussels to have direct access, bypassing national Parliaments, just as happened with citizenship and other bits of the treaty.

§ Mr. Garel-Jones
No, Sir.

§ Ms. Joyce Quin (Gateshead, East)
Even if the Minister is not prepared to say exactly what the representations should be from the United Kingdom, will he at least concede the principle that in the case of Scotland, Wales or the northern region of England, where a clear majority voted against the Government, representatives will reflect the political majority and not just be nominees from the Government's ranks?

§ Mr. Garel-Jones
I shall refer to that point in a minute.

§ Mr. Geoffrey Hoon (Ashfield)
Will the right hon. Gentleman give way?

§ Mr. Garel-Jones
May I be allowed to answer the hon. Member for Gateshead, East (Ms. Quin).
I am trying to establish that there is no obligation whatever on the United Kingdom Government, or indeed on any other Government, to fulfil what is set out in the amendment, that is that all members should automatically be elected members of a local authority. Not only is there no obligation to that but no member state that has so far made its nominations to the Committee of the Regions has done so. Two countries have made their nominations, and not one of them has so far nominated only elected local government people.

§ Mr. George Robertson (Hamilton)
The Minister tells the Committee that only Greece and the Netherlands have made a nomination. On 2 December, the Bundestag agreed to allocate at least three seats of its delegation to local authorities, all others to go to the Lander, therefore all elected representatives from Germany. The Danish Government have now made their nominations by agreement with the Association of Local and County Authorities and the city of Copenhagen, with four each of the counties and the municipalities and one of the city of Copenhagen. In Luxembourg, all nominees are to be elected members of local authorities. What is the position?

§ Mr. Garel-Jones
I am simply telling the Committee that, so far, two member states have nominated—[Interruption.] The hon. Member for Hamilton (Mr. Robertson) is telling me that the Lander will have certain nominations in respect of the Committee of the Regions. Is the hon. Gentleman aware who they will nominate? Perhaps he had better wait. Let us wait and see whom they nominate. It is perfectly within the bounds of possibility 519 that a Land in the Federal Republic might decide to send one of their Ministers to the Committee of the Regions or to nominate someone else. The statement that I have made to the Committee remains the case.

Several hon. Members
rose—

§ Mr. Garel-Jones
No, I am not going to give way. Two member states have nominated their members to the Committee of the Regions, and those member states have not nominated exclusively democratically elected people. That is a statement of fact.

§ Mr. George Robertson
That is all slightly disingenuous. We know that the Minister is dancing on a fine point. The United Kingdom is in the process of ratifying the treaty and is the second to last country to do so. Clearly, no one will make final decisions about the nominees and the individuals who will sit on a committee which has not yet been established under a treaty which has not yet been ratified or implemented.
The Minister should address the point that EC countries, other than the two which he has mentioned, have clearly set out the principle which they will follow when they make their nominations. Why is the Minister dodging the issue by concentrating on two countries and not on the other three countries which I mentioned earlier?

§ Mr. Garel-Jones
Let me spell it out in capital letters. I am not prepared to commit Her Majesty's Government to a guarantee that the 24 members appointed to the Committee of the Regions will be elected local government councillors. Is that clear enough for the hon. Member for Hamilton. Does he understand it?

§ Mr. Jenkin
Will my right hon. Friend give way?

§ Mr. Garel-Jones
No, I will not give way to my hon. Friend but I will give way to the hon. Member for Moray (Mrs. Ewing).

§ Mrs. Margaret Ewing (Moray)
The democratic principle underpinning the nominations of people to the Committee of the Regions is critical to all of us so we want proportionality and elected accountability. The Minister said that he will not commit the Government to ensuring that all the United Kingdom nominees will be local councillors. Will a proportion of the nominees be local councillors?

§ Mr. Garel-Jones
The Government will listen carefully to representations from political parties, local government and other regional interests in the United Kingdom before coming to their decision. We will listen carefully and constructively. The point which I am trying to make in the debate—which is a fair one—is that we do not want to tie ourselves to having only locally-elected councillors, as the amendment seeks to do. Hon. Members on both sides of the House will be aware of the defects which such a system could impart to Britain's representatives on what may turn out to be an important Community institution in the future.

§ Mr. James Hill (Southampton, Test)
My right hon. Friend is right to say that one cannot specify who will be on the committee. After all, the regional development fund has been going since 1973, and experience has shown that 520 it is important to get people with some expertise, whether they are politicians or engineers. We must get people who know about road transport and shipping so that we can tie together the whole regional planning infrastructure.

§ Mr. Garel-Jones
My hon. Friend makes an important point and it is one of the many considerations which the Government will have to take into account when they consider the matter.

Several hon. Members
rose—

§ Mr. Garel-Jones
I want to make a little more progress. I intervened early because I want to listen to the whole debate for a good reason: I expect that a number of hon. Members from different regions in the United Kingdom who represent different interests in Scotland, Wales and Northern Ireland will make important points. The Government intend to listen carefully to those points.
It is not wise for the Committee to accept the amendment. I do not accept that the amendment will lead the Committee to produce a system of nomination which will do adequate justice to the interests of all the regions in the United Kingdom.

§ Mr. Radice
Does the Minister think that the majority of members on the Committee of the Regions should be elected local government representatives?

§ Mr. Garel-Jones
I think that I have already answered that question.

§ Dame Elaine Kellett-Bowman
As one who represents a rural area, I hope that, for example, the President of the National Farmers Union will be a welcome member of the regional committee.

§ Mr. Garel-Jones
My hon. Friend makes an important point. The Government must listen to such representations. I give way to the hon. Member for Banff and Buchan (Mr. Salmond) and then I must bring my remarks to a conclusion.

§ Mr. Salmond
It is reasonable for the Minister to say that he is not happy with the amendment. However, it is unreasonable for him not to give the Committee an indication of the Government's thinking on who should be nominated. It will be surprising if the Committee makes progress on this part of the Bill before the Minister gives us some illustration of that point.

§ Mr. Garel-Jones
As I have said, I expect the debate to run for some time. I intend to listen to most, if not all, of the debate and to hear the points which undoubtedly hon. Labour Members will make.
Two considerations underlie the debate: first, I am not convinced that it will be wise to commit the United Kingdom to nominating only elected councillors to the Committee of the Regions and, secondly, the proposed distribution of numbers will not have escaped the notice of the hon. Member for Banff and Buchan.
There will be strong competing claims on a proportional basis, and a substantial number of the committee members should go to England. Most English hon. Members accept that there must be—and it is right that there should be—some sort of weighting towards Scotland, Wales and Northern Ireland. That is also a matter for careful consideration. I have detained the Committee for long enough, and I will now allow hon. Members to make their speeches.

§ Mr. Ted Rowlands (Merthyr Tydfil and Rhymney)
I have followed the debate with great interest. Perhaps we should start by asking ourselves what function the Committee of the Regions will play. What part will the committee play in the structure and development of the treaty? As the Minister and others have said, the implication and assumption is that the role of the Committee of the Regions will be an important buttress of the decentralising tendency.
One claim is that the treaty represents a fundamental arrest of the movement towards the centralising process—subsidiarity and the development of alternative pillars to the inter-governmental processes. On top of that, it is considered that the Committee of the Regions is a practical gesture, if not a symbol, in favour of decentralisation.
The trouble with the treaty is that its structure is so inherently unstable that it can be interpreted in two contradictory ways. The measures can be interpreted as acting as a decentralising force and therefore arresting what previously seemed to be the development towards a centralised Europe. Evidence which the Select Committee on Foreign Affairs received from many expert witnesses shows that the treaty is equally capable of being interpreted as a centralising force.
The role of the treaty in not only monetary union, but the other institutions being created will result in a more centralised union or centralised European federal state, rather than a decentralised union. In that context, the Committee of the Regions would have a different function and have a different connotation.
Earlier, I think that the hon. Member for Southampton, Test (Mr. Hill) made the point that, if the role of the Committee of the Regions is developed, the committee could become part of a triad—the Commission, the European union, and the Committee of the Regions —acting jointly to erode, subvert or go round national Governments, national Parliaments and the European Council. There is no doubt that the Commission had a different structure at heart in many of its preparatory documents which led to the Maastricht treaty. The Commission did not get its way, and we should be thankful for that.
The gist and drive behind the Commissioners' ideas of what Maastricht should eventually lead to was a concept of a centralised executive Commission working in close harmony with the European Parliament but at the same time breaking what it saw as the obstacle to a federal European union structure—national Parliaments and national Governments represented by the European Council. If the Maastricht route also makes possible that alternative strategy, we must certainly ask ourselves about the function and role of the Committee of the Regions.
My fundamental objection to the treaty is not that one can be altogether dogmatic about where Maastricht will lead us but that it is capable of taking us to a different destination from the one which is often presented to us by the Government. They suggest that it is leading us to a stage at which we shall have arrested the ever more powerful centralising tendency of the European union and European Community.

§ Mr. Hoon
I do not wish to disagree with my hon. Friend's interpretation of the Maastricht treaty. He has his view, and I have a rather different one. However, I should be interested to know where he sees any evidence in chapter 4, which establishes the Committee of the Regions, for the centralising tendency to which he refers.

§ Mr. Rowlands
My hon. Friend is correct: it is neutral. That is my point. The question is not so much what is written into the provisions—I shall make the point later that the provisions which establish the Committee of the Regions are rather scrappy—as what is the fundamental drift, structural aim and objective of not only Maastricht but the review conference in 1996. Is it to take further the new bridgeheads which have been established? After 1996, will the alternative scenario be developed and created? I do not suggest that it will happen, but one must interpret a perfectly neutral article and decide which way Maastricht is leading us.

§ Mr. Shore
My hon. Friend's argument is a persuasive one. We can all recall the vision of a Europe of the regions, as distinct from a Europe of nation states, of which some people on the European continent and especially in the Commission have always been in favour. But in the context of regional policy, surely the point is that a double process is taking place. One is the transfer of regional policy decision-making and funds to the European Commission. That is a centralising process. The other is the phasing out, control and diminution of national regional policy. It is, indeed, a transfer of power and a centralising process.

§ Mr. Rowlands
My right hon. Friend raises some fundamental central points. One of the sadnesses is that we have been forced to debate a huge portmanteau of amendments on regional and cohesion funds and the appointment of a separate institution, a Committee of the Regions.
If one is to devise a process of convergence which will lead to monetary union by any other method than the monetarist one—which is in my view at the heart of the treaty—the development of regional and cohesion funds is vital. However, as my hon. Friend the Member for Hartlepool (Mr. Mandelson) said in an earlier debate, very large funds are necessary to develop any form of cohesion within a meaningful time scale.
The very nature of accumulating such huge funds is itself a centralising process. Funds of that size will have to be administered, organised and distributed from the centre. If one is to achieve convergence and monetary union by the socially and economically acceptable route of redistributing large funds, a European Government is necessary to do it.
It is a perfectly reasonable proposition, but nevertheless the Government pretend that it is not one which is presented to us in the Maastricht treaty. As my right hon. Friend the Member for Bethnal Green and Stepney (Mr. Shore) said, such a scenario might be proposed in 1996. We are entitled to ask whether the Committee of the Regions will be part and parcel of a genuine process of decentralisation, of the arresting process which others claim is socially acceptable and of the creation of subsidiarity and the intergovernmental pillars of the 523 treaty. Or is it possible that the other route of a Europe of the regions and a growingly centralised European executive will be pursued?
I am exercising a neutral view, but it is a perfectly reasonable interpretation of the processes that are likely to flow from Maastricht. It is as reasonable as the Government's interpretation. They suggest that the Maastricht treaty is essentially a decentralising measure.

§ Mr. Jon Owen Jones (Cardiff, Central)
Does my hon. Friend agree that a reasonable definition of subsidiarity does not conflict with the paradox which is apparently laid before us? A reasonable definition is that government should occur at the lowest level at which it can be effective. On some matters, it can be effective only at a transnational level. Examples include a single currency and environmental legislation. Other forms of government can be far more effective at a much lower level. So that apparent paradox is not in fact contradictory.

§ Mr. Rowlands
No, I do not believe it is. My hon. Friend rightly says that subsidiarity is a two-way process. Just as much as it could be a decentralising process, it could be the confirmation of a large movement of power from local or decentralised structures to the centre.
I do not wish to dwell on subsidiarity, Mr. Lofthouse, because we shall have a separate debate on it. I draw the attention of the Committee to the voluminous evidence on subsidiarity which we took in the Foreign Affairs Select Committee. I warn any of my hon. Friends or any hon. Members who think that they have cast-iron guarantees about the success of subsidiarity—I have been as diligent as possible in going through the evidence—not to buy a simplistic view of it or its potential effectiveness.
My proposition is simple. It is possible to interpret the potential role of a future Committee of the Regions in the context of a rather different European structure from that which is presented to us by Ministers and some of those who want to pretend that Maastricht does not contain at least the potential for centralisation and a larger European executive.
The Maastricht treaty could be a first step on the road to a Europe of the regions. The irony about that for me as a Welshman is that, if the House and the British people decided that they wanted to turn Westminster into a glorified Lander, that might be their decision. We would then have a most powerful and overwhelming case to establish our own Länd, in the form of an elected assembly for Wales. I believe that we have a case for such an assembly now, but as Maastricht could lead towards the transformation of Westminster into a glorified Länd, I cannot see why I should come to Westminster. I should do far better trying to represent my communities in a Welsh elected assembly.
I have been a keen supporter of a Welsh elected assembly. Regional assemblies are the alternative scenario for future constitutional development. Not one Minister or Member of Parliament who campaigns for the treaty claims that that is the destination to which Masticate might eventually lead. If they were honest and accepted that that was a perfectly acceptable option, I as a Welshman could happily accept the joy and privilege of 524 representing my communities in a Welsh elected assembly. Its powers and responsibilities would be on a par with a glorified Westminster Länd.
Is that the way in which the Government and the British people want to go? They have not to date expressed their views in those terms, but the potential is there, offered by Maastricht, and with that potential comes the possibility of a major new powerful European executive.
That is why the members of nationalist parties in this Parliament have embraced the concept of Europe and have been voting with the Government on most of the treaty. They believe that the potential exists here to achieve their goal. I think I see some of them indicating assent at that. That scenario has not been presented to us. In other words, they are voting for a model even though the Government are pretending that the model does not exist or is not potentially possible under the Maastricht treaty.

§ Mr. Nicholas Winterton
The hon. Gentleman will agree that the cohesion funds are designed to reduce disparities between the levels of development of various regions and the backwardness of the least favoured areas, including rural areas. Does he accept that all areas of this country, whether or not represented by those with separatist tendencies, are already losing out in the EC in vital and fundamental industries such as textiles and paper and board, whereas countries such as Portugal and Spain are obtaining huge additional funds from the Community, resulting in our losing jobs in Scotland, Wales and virtually every region of the United Kingdom? Does he further agree that that is just a sample of what is likely to happen if we ratify Maastricht?

§ Mr. Rowlands
I was coming to that very subject, which is the potential—or perhaps the lack of it—resulting from the role of the Committee of the Regions. What are we buying? We are told that, at least to start with, the committee will be potentially an important expression of the voice of the regions—in the case of the area I represent, the national regions.
I have searched studiously through the treaty, because the article with which we are dealing does not specify the duties of the Committee of the Regions. We are told that its duties are given in the treaty, but it is difficult to work out what they will be. For example, the committee could play an invaluable role if, as some witnesses who gave evidence before the Select Committee on Foreign Affairs suggested, it will be the champion voice for greater structural, regional and cohesion funds to be directed to poorer regions and nations on the periphery of the new European union.
If that were to be the function of the Committee of the Regions, I could support it, but it is difficult to discover a meaningful definition of the powers, responsibilities and duties that it will have. I would be happier if the treaty spelled out its role, albeit consultative. After all, we are speaking only of an advisory body. We may argue about who should be on it, but we would feel happier if the treaty showed a clearly defined role for it, perhaps saying that it must be advised on all issues relating to the cohesion fund, the structural fund and various other funds in a way that might lead to a redistribution of wealth in the Community.
We need such a body, because our only voice in Brussels now is the Secretary of State for Wales, and by any standard, his has been a poor voice, which has delivered remarkably little in terms of regional and 525 structural support to the communities that I represent. He has even failed to make sure that we are a part of the operation. I remind the Committee that no part of the areas I represent will get a penny from the cohesion fund.
6.15 pm
It has been suggested that, as good socialists, we should support the poorest. Mid Glamorgan's GDP is only 70 per cent. of the average of that of the United Kingdom. By any calculation of GDP per capita—by any formula; most formulae are fixed to deliver the results that are wanted —whether purchasing power, parity or rates of exchange, Mid Glamorgan and the communities I represent qualify as much as Spain, Greece and, I am sorry to say, Ireland. But there is no suggestion that cohesion fund money should come to my communities.
The Minister talked about targeting. We are talking about a poorly targeted cohesion fund, because it has been crudely decided that the money shall go to four of the Twelve. The funds will not go to regions, areas or communities in the Community. They will go to four member states, irrespective of whether there are in those states areas much wealthier than any of the communities I represent.

§ Mr John D. Taylor
Does the hon. Gentleman agree that Maastricht is inconsistent and contradicts itself, in that, although it stresses the importance of regions, the cohesion fund dismisses entirely the importance of regions and sticks strictly to the importance of national states?

§ Mr. Rowlands
That is the point that I am making. The Minister agreed, frankly, that what had occurred was a bargain. It was a fix. It was a way to achieve the support of four of the Twelve—for a variety of other developments within the concept of Maastricht—and was therefore a way to buy support. The cohesion fund is not based on any rigorous assessment of need.
We talk much about cohesion and convergence. My community is at present suffering not from convergence but from divergence, even within the United Kingdom economy. As I say, Mid Glamorgan has only 70 per cent. of the United Kingdom's average GDP. That has come about as a result of Conservative policies. That position has not been addressed or redressed by the Secretary of State for Wales campaigning for the redistribution of funds in the EC on behalf of communities such as mine, which, by any criteria, qualify for cohesion and other types of regional funding.

§ Mr. Marlow
I take fully the hon. Gentleman's point that the money is targeted purely at four countries—Greece, Ireland, Spain and Portugal. It is not targeted where the need exists or to rural areas but to those four countries. The hon. Gentleman will be aware that the Commission wants to manage the fund itself, in alliance with those four countries. So effectively the Commission wants the money not to overcome the problems of poverty in parts of the Community; it wants four client states that will agree in future with its agenda.

§ Mr. Rowlands
I would not push the conspiratorial view that far, although I believe that a deal, a fix, has occurred. It was an arrangement.
We are told that the cohesion fund is a special new fund to be devoted to those four countries, and a formula has been devised to make the arrangement look rational. That means that we must direct our attention next to the 526 structural fund because that is where the larger proportion of the money lies. Hence, on behalf of a community with a GDP per capita in the band of the four cohesion fund countries, I do just that and turn to the structural fund.
On doing so, I discover that the first objective, relating to the largest part of the fund—it was about four fifths of the total; I am having difficulty working out whether Edinburgh shifted the proportion somewhat—names the only qualifying community in the United Kingdom as Northern Ireland.
Mid Glamorgans's GDP is lower than that of Northern Ireland. It is saddening when one hears the self-deluding statements of the Secretary of State for Wales telling us that our economy has been transformed. The transformation of the south Wales economy has meant that Mid Glamorgan, in GDP terms, is in a lower state, I am sorry to say in the presence of Northern Ireland Members, than that of Northern Ireland. That is the marvellous miracle of transformation that the Secretary of State and his predecessor have wrought with his valleys initiative. That is the truth about our economy currently, and we still do not qualify for objective 1 funding. Not only are we outside cohesion funding; we are also outside objective 1 funding.

§ Mr. Allan Rogers (Rhondda)
Our constituencies share much the same problem, so I have a great deal of sympathy for what my hon. Friend is saying, but he will accept, I am sure, that one of the reasons that our areas are so poor and deprived is that they have been choked off from European funds under the present system. This Government have not fulfilled their commitment under present arrangements; that is why, with Commissioner Milian, the problem of additionality reared its head and there was a major conflict between the Commissioner and the present Government.
When I was a Member of the European Parliament, I found that Welsh local authorities like Llanelli, Merthyr, Rhymney Valley and Blaenau Gwent approached members of the European Parliament to go direct to the Commission because this Government were blocking European funds.

§ Mr. Rowlands
My hon. Friend expresses the frustration of so many communities under Rechar and all the other arrangements. We fought hard to get some scraps out of the system for communities and societies which, as I have demonstrated, by any objective criteria, sadly qualify.

§ Mr. Shore
My hon. Friend is making a very important point. The plain truth is that ever since the two categories, 1 and 2, were introduced three or four years ago, the effect on the United Kingdom has been disastrous. We received less money in 1991, the last complete year available, than we did in 1986. Meanwhile, the regional fund has trebled.

§ Mr. Rowlands
That is the point, and it is the ultimate condemnation of a Government who have failed to fight for us, and of the categories—it is a bit of both, I think. The Government could have fought for different categorisation of our communities.
There is no reason why an objective 1 category should not cover communities like mine, because by any GDP per capita figure they ought to be part of it but are not. That is part of the funding under the structural fund.
527 The voice of the United Kingdom in Brussels, the voice we had, that of the Secretary of State, has been sorely inadequate and has failed us completely in fighting for the proper redistribution of funds to achieve development and growth and to achieve a breakthrough in growth, to break through the cycle of deprivation and the cycle of disappointing achievement which is so much of the character and nature of the communities I represent.
I ask myself, do I go back to Merthyr Tydfil and Rhymney and say that there is an alternative called the Committee of the Regions with sufficient power and voice to be able to redress the balance in Europe? I fear that I cannot. I am worried and concerned that it will be a sop rather than an effective alternative regional voice within the structures of the new Europe of the European union.
I hope that I am wrong, because we desperately need a much more effective and radical voice speaking for the communities I represent, not only at Westminster, in the form of an alternative Government, and a change of heart, but also in Brussels and Europe from where we now know that some of these funds should be coming to break our cycle of deprivation but are not reaching us. That is our case. My concern is that we are not over-sold—not sold something which turns out to be another talking shop.
The Minister talked about subtlety of the appointments. There has been nothing subtle about the appointments made by the Secretary of State for Wales. Time and time again, he has appointed Conservative party chairpersons of one kind or another into a host of positions, wholly unrepresentative, even reaching to the heart of our health service, bringing services out of the Community, and now they are utterly unrepresentative of the spirit, feelings and wishes of the people of Wales.
It is little wonder that we treat these appointments with great scepticism, and demand a more rigorous and statutory basis for these appointments, because we shall be left by the Secretary of State with a group of yes-persons of the character we have seen in the quangos that have been established in the past 10 years in Wales, fixed and filled with overtly party political appointments.
While I support the drift and the principle of the amendments that have been moved to prevent that, I ask the Committee seriously to consider whether the character and nature of this committee is, in the longer term, the route we wish to pursue.

§ Mr. Hill
It is an interesting but not, so far, a constructive debate. We have been talking around the regional fund but most Members have so far been discussing how to pack the Committee of the Regions with some of their friends. I put it no higher than that because this argument often comes up when a new institution is formed. The spokesman for the Liberal Democrat party on European matters and I were probably the only two hon. Members here who were members of the European regional policy committee in Brussels in 1973. These well displayed arguments, beautifully formed, with high indignation—"I am not going to get anything out of it"—are the sort of thing we have gone through time after time. The question is whether the regional development fund has become better over the past few years. We are talking about a period of 20 years.
I remember clearly, as I am sure does the hon. Member for Inverness, Nairn and Lochaber (Sir R. Johnston), that 528 we realised at the time that the regional development fund, which was under-funded, did practically nothing. A regional fund for which every application has to be dealt with from central Governments would be very undemocratic. That had to be. In those days, when only Germany and the United Kingdom, perhaps, had the money to fund the development fund, we were delighted to find that we got 1,200 million ecu for a year. That lasted for one year. Then it went down to 450 million ecu. That is the way the fund can go. When one talks about a strategic fund which has to fulfil the expectations of everyone from the United Kingdom right down to Greece, Spain and Portugal, one realises that this is not a very sensible approach.
Much of the idea in this case, too, is that the money will be targeted on the four poorest countries. We have always had this argument with regional development, about where the money should go. There was even a study at one time, which I took up myself, about the bridges and tunnels from Denmark to Sweden. We could have spent the whole of the regional development fund for many years on that, but the idea of this fund is that one does what the Committee of the Regions declares is essential; one starts from there.
In the days that I am talking about there was no representation of the type envisaged in article 130b. There was no representation on that scale, although there were the heads of regional development. My old chum Christopher Chataway was a Minister at the time and every application had to go through his Department. The Committee of the Regions is the start of a bit of democracy, but we do not seem to want to recognise that or to congratulate the Prime Minister. The committee will have 24 representatives from the United Kingdom, who will be taken from all classes. I am not talking about politicians, as the average politician is a poor administrator—local councils are a good example of that and are poorly administered—and one cannot give them all the seats on the committee.
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When the committee is working, each region will have to put its case through its representatives. The committee will not be like the old closed shop. The only difficulty that I can envisage is that the committee has to submit a report to the European Parliament once in every three years. That time scale is too long.

§ Mr. Clive Betts (Sheffield, Attercliffe)
The hon. Gentleman used the words "representatives of the regions", but does he accept that they cannot be true representatives of their locality if they are appointed by national Government rather than by local or regional government? The Minister responded to my hon. Friend the Member for Copeland (Dr. Cunningham) about the system in Germany. The Länder can appoint people who are not representatives in the Länder, but the important thing is that, rather than the German Government, Länder will do the appointing. That is crucial and no Conservative Member has dealt with that issue.

§ Mr. Hill
I do not know where that argument is going. The committee must be formed and each national Government will have its own way of submitting names. The mere fact that Germany or any other country—Greece, for example—has a different system is not at issue. Our system will be plain. We want people with great 529 expertise and we do not want a lot of time servers or a mass of people who have been on local councils for 50 years. We certainly do not want a lot of Back Benchers, who are only in the European argument to knock it to the ground.

§ Mr. Randall
Many Opposition Members are concerned because we believe that the Government do not have a regional policy. The Committee of the Regions will be able to do what it likes—the scope of its responsibility is open. If people on the committee represent their regions, they will want to change regional policy. Since the Government do not want that to happen, they will put their Tory cronies in to block the whole system. That would be negative and would make the committee ineffective.

§ Mr. Hill
I am sure that my right hon. Friend the Minister will be able to refute that later. The hon. Gentleman mentioned "Tory cronies." There are socialist cronies, too.

§ Mr. Garel-Jones
I apologise to the Committee for not having said in my remarks that I hoped that Members would deal in their contributions with membership of the committee. It is probable that the Committee of the Regions will have a plenary meeting, but we estimate that about two days work each week will be required from those nominated to represent the United Kingdom. I hope that hon. Members will appreciate that an elected councillor might find two days each week rather burdensome. The two countries which have nominated representatives have not chosen to nominate only elected councillors. That is another argument in favour of not doing so.

§ Mr. Hill
The main argument is to get rid of political points. My next remarks will probably raise more hackles on the Opposition Benches.
Advisers from the European investment bank will have to deal with the regional development fund and it would not be a bad idea to appoint someone who knows the banking industry. The same argument applies to practically everything that the committee will do. It will not want any time servers, and from what my right hon. Friend has said I am sure that it will not get them.
There has always been an argument about peripherals. We have always had to plough more money in, and transborder money was always bespoken. Everyone, whether from Wales, Scotland, Ireland or anywhere else, was always at risk because they were not getting a sufficient slice of the cake. That is an odd way to approach the matter. The committee is just beginning. One will find that because of the quality of the people appointed to the Committee—people from throughout the United Kingdom—they will be approachable. They will not say, "You're only a Welshman—I'm not going to have anything to do with you because you have nothing to do with my region." When the committee is in place, 24 people will be working as a team to highlight some of the problems of the regions.
I have long thought that the regional development fund did not get enough publicity for the fact that it provided millions of ecus to build the M25. Much of the funding came from the fund, but no one seemed to know about it. It was assumed that it was taxpayers' money—[HON. MEMBERS: "It was."] I suppose that in a roundabout way it was. However, people who have become interested in 530 European affairs in the past two years would never have known that the M25 was financed by the regional development fund.
I must make a plea for a contribution from the Committee of the Regions. As soon as it sits, I should like it to study the construction of a southern counties expressway, made up of a route from Dover, along the south coast to Southampton. What better way is there to spend money? The expressway could also upgrade the A34 to Oxford and then turn eastwards, to Aylesbury and the east coast ports. One would stress to the committee that the expressway would be of motorway standard, and would provide an alternative to the M25. The concept is designed to cater for the ever-growing European dimension of trade within the Communiy.
If we are a trading nation, we cannot ignore Europe. I cannot think that any hon. Member supposes that we could go back to being an island, trading only with ourselves and once in a while with America. Most hon. Members are politically wise and they must know that we cannot stay in isolation. A famous Labour Member said some years ago that we will be an island—I think that he is still saying it—and that we will trade where we can. He did not say "if we can, and he did not dismiss all those people in Europe who are looking to us as trading partners. He did not say, "Let us throw them all out with the bath water." He said, "We will trade where we can."
When the members of the committee are studying what they wish to improve on the periphery of Europe, they will obviously look at trading matters. It is no use setting up a motorway, a seaport an airport or any great transport infrastructure if industry is not put at the end of the road. That will be one of the biggest problems. They may even think of Wales or Scotland for these industrial estates.
If one could only get beyond the idea of having three Labour councillors, three Conservative councillors, and perhaps poor old Bloggs who went to the other place some years ago, and think of the opportunities—

§ Mr. Nicholas Winterton
Will my hon. Friend give way?

§ Mr. Hill
Certainly not to him. [Interruption.] I am not giving way to any of them. Everyone can speak this evening. I do not want to be critical of some of my colleagues, but they have more or less had their 10-minute speeches already. They have been interrupting each other or interrupting sympathisers across the Chamber. I will not aid and abet them in this deceit, because, as you rightly said, Mr. Lofthouse, everyone can speak in this debate for 10 or 15 minutes, if he or she wishes.
I am waiting anxiously to hear the speech of my hon. Friend the Member for Macclesfield (Mr. Winterton) on regional development. Certainly, no one here knows the slightest thing about how the original regional development fund was started. I am waiting to hear some really good information. I have tried to say very little, because so many hon. Members are waiting to speak.

§ Sir Richard Body (Holland with Boston)
Will my hon. Friend give way?

§ Mr. Hill
There is a quavering voice at the back of me, but I am not going to give way. The poor quavering old chap must sit back in his seat and wait until he catches your eye, Mr. Lofthouse.
I feel that we are getting to the heart of the argument now. I admire the amendments that have been put down 531 —not that I shall vote for them, of course—because they have just one theme and they say exactly the same thing over and over again: let us see how we can pack the Committee of the Regions with our cronies. Ours will not be Tory cronies—they will be Tory experts.

§ Mr. John D. Taylor (Strangford)
How refreshing it has been to hear the real voice of the Tory party. It was certainly amusing. Unfortunately, I did not understand one word of what the hon. Gentleman was getting at, and I do not think that the Minister did either, because I noticed that he was keeping his head very low during the hon. Member's speech.
This debate is naturally of interest to us in Northern Ireland, as one of the regions in the European Community. The Maastricht agreement is something that, as I said on Second Reading, we in the Ulster Unionist party oppose, because, at the end of the day, it is a treaty for the union of Europe, basically moving away from a Europe of sovereign states co-operating into a Europe of European regions. It is a shift in that direction. That is the real thrust of the Maastricht agreement: slowly, step by step, to undermine the sovereignty of the 12 nations and establish in their place the regions.
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I do not agree with that, but, if it is taking place and if it is to happen, I have to come down in favour of the Committee of the Regions. To that extent, and with that qualification, I support the proposal for such a committee.
We in Northern Ireland have been very badly governed since 1972. We have never had a representative elected in Northern Ireland governing us; it has always been an elected representative from England, and perhaps once or twice from Scotland. We therefore have little say in our own affairs, and certainly in the European Community we have no voice other than through the three Members of the European Parliament in Strasbourg. In Brussels, the Northern Ireland Office is hardly ever heard; it is not represented by Ministers in the Council of Ministers on fisheries, agriculture or any of the other important issues that affect us in Northern Ireland.
I well remember from my 10 years in the European Parliament, most of which I served as a member of the European regional committee, that it was one of the more useful committees in the Parliament, within which the regions had a voice. I remember that there was a lady called Beatta Brookes who certainly spoke up for Wales. It is perhaps not popular to mention her on this side of the Committee—[Interruption.] I am certainly not going to embarrass the other side of the Committee.
Certainly, the European regional committee was one of the more influential committees in the European Parliament. Because of the weakness of the Northern Ireland Office, it was possible for the elected Members of the European Parliament to correct the mistakes which the Northern Ireland Office was making. I will give an example.
A scheme was devised under the European regional development programme for cross-border tourist projects for the border regions. That was a good idea on both the Northern Ireland and the Republic of Ireland sides of the border. When the proposed map of the areas of tourism was produced to the regional committee of the European 532 Parliament, Donegal was naturally recommended, and Sligo and Leitrim as very good tourist areas on the southern side of the border. And what did the Northern Ireland Office recommend for our side? It recommended Crossmaglen and South Armagh—for tourist projects. That was a mistake, Mr. Lofthouse, as you will recognise.
When the scheme came before the regional committee of the European Parliament, I got my Communist colleagues, my Labour colleagues from Wales, my Social Democrat, Conservative and Christian Democrat colleagues to support me in an amendment to change the boundaries. We finally got the mountains of Mourne and Newcastle included as principal tourist areas near the border. I managed to slip in part of my own constituency as well while I was at it.
That was accepted, and we immediately became the first places in Northern Ireland to benefit from this scheme. We got a £1 million tourist project in the village of Millisle. This shows how an elected representative from an area can influence the regional development policy to help his own region.
That is why I welcome this proposal in principle. If we are to have a Europe of the regions, which we are moving towards—although, as I say, I am not very happy with that drift in European political thinking—I believe that the European Committee for the Regions is a good idea, and the people on it should be locally elected representatives of the regions.
I do not accept what the Minister has told the Committee this afternoon—that only two countries have so far decided the basis of their representation on the committee. If he looks into it more carefully, or is advised better by his officials, I think that he will find that most of the countries are coming down in favour of locally elected representatives on the committee.

§ Mr. Garel-Jones
Of course, three member states, as mentioned by the Opposition Front-Bench spokesman, the hon. Member for Copeland (Dr. Cunningham), have indicated how they intend, broadly speaking, to appoint their members. I am simply making the point, which I believe to he a fair one, that two member states have so far not gone entirely down that road.
There is a case for a mix—a case that I hope the Committee will address. I am open-minded about this matter. The Government have not made any decisions. However, I should like the right hon. Gentleman to consider his own part of the kingdom and make his own judgment about the number of people who might be available, as that is an important aspect of the matter. He should consider whether the election of a representative —or two, or whatever number might be allocated—would be the proper route. I am genuinely interested in hearing the right hon. Gentleman's views.

§ Mr. Taylor
I am glad to detect a shift of emphasis in what the Minister has said. In his opening speech, he said that only two nations had made recommendations about their representatives on the Committee of the Regions. The hon. Member for Copeland (Dr. Cunningham) said that there were a further three. I note that the Minister no longer rejects what the Opposition spokesman has suggested.
Our own research paper mentions one of those three. It says:
Denmark—number of seats, nine. 533 The Danish Government has now made its nominations by agreement with the Association of Local and County Authorities and the city of Copenhagen: four seats to counties and municipalities, and one to the city of Copenhagen. So, in Denmark, the representatives are being selected in co-operation with the locally elected authorities. I could quote what is happening in the other countries, and I stand by my contention that most countries are clearly going for locally elected representatives on the Committee of the Regions.

§ Mr. Garel-Jones
The only point that I am seeking to establish is that it would not be against the spirit or the letter of the treaty not to have locally elected representatives. Clearly, that is one of the options available to us, but the Government have not made any decision. We shall listen carefully to the points that are made. The reason for my rejection of the Opposition's amendment is that it seeks to establish that all members of the Committee of the Regions must be locally elected councillors. That is not necessarily the answer.

§ Mr. Taylor
The Minister is right to say that he is under no obligation to appoint locally elected representatives to the new Committee of the Regions. The other 11 countries of the European Communities will concentrate on having elected representatives from the regions, and that is what we would prefer for the United Kingdom.
I gave as an example my experience in the European Parliament, on whose regional committee I was able to exercise influence when the Northern Ireland Office had failed to do so. I fear that, if it is left to the Welsh Office, the Scottish Office and the Northern Ireland Office to send representatives to this committee, Wales, Scotland and Northern Ireland will not have a truly representative voice. That is bound to be so in the case of Wales, which has an Englishman as Secretary of State.

§ Mr. Salmond
But there is a grave weakness even in the terms of the amendment. It uses the words shall be drawn from elected local government representatives. If it is left to the Government to choose the elected local representatives, they will still have the whip hand and the power of discretion. They will be able to select any local representatives who are amenable.

§ Mr. Taylor
Fortunately, they will not find any Conservative elected representatives in Northern Ireland. That will not be a major problem for us. However, I take the hon. Gentleman's point.

§ Rev. Ian Paisley
There are Tory councillors, and they could well be chosen. Indeed, three of them could be picked.

§ Mr. Taylor
As the hon. Gentleman knows, most of those Conservatives have announced that they will join the Ulster Unionist party. The Tory candidate in the constituency of Belfast, East at the last general election has said that he intends to stand as an Ulster Unionist candidate in the forthcoming local elections.

§ Rev. Martin Smyth
I appreciate the point that my right hon. Friend is making. Does he agree that, in the case of Northern Ireland, Ministers are appointing tame people who will do their bidding rather than represent the wishes of the people—especially when councils suggest people?

§ Mr. Taylor
This is a common problem throughout Northern Ireland, and the more one listens to this debate the more one realises that it is shared in Wales and in Scotland. More and more quangos and other such bodies are being created in our parts of the United Kingdom. We are getting placemen rather than people who are truly representative of the local community.
The Minister asked whether I would like to have on this Committee an elected representative from Northern Ireland. The answer is yes. There is in Northern Ireland an association of local authorities. I should like to see on the Committee of the Regions some representation through that body. There should be at least two members from Northern Ireland.

§ Mr. Salmond
Only two?

§ Mr. Taylor
Two will be sufficient. If Scotland gets one, we shall take two.
I should like to refer to the cohesion fund, as I am very concerned about it.

§ Mrs. Dunwoody
The right hon. Gentleman will recall that, earlier in the day, the Minister was very cruel in referring to conspiracies on the Back Benches. As the Minister is now on the Opposition Front Bench, can we take it that there is a conspiracy there?

§ Mr. Taylor
I have already mentioned the transfer of several Conservatives to the Ulster Unionist party. I am glad that the Minister is moving closer to us.

§ Mr. Garel-Jones
I was simply doing my best to ascertain what had been arranged with my hon. Friends on the Back Benches. Collusion rages on all sides.

§ Mr. Taylor
I know that the Minister is an authority on collusion.
The cohesion fund is a matter of great concern throughout the United Kingdom. This is not a Northern Ireland issue. The regional fund was quite properly intended to assist the regions in greatest need. We heard, for example, about Mid Glamorgan. That is the sort of region that should qualify under the European regional development fund. But there are similar regions throughout the 12 countries of the European Communities.
The problem with the cohension fund is that it is not related to regions at all, that it is related to states—and to four states only. Although the whole emphasis of the Maastricht agreement is on giving more power to the regions and on the creation of a European union of the regions, it contains a contradiction, in that it creates a cohesion fund for four states only. That will damage the interests of some regions in states that are poorer than the four that are to benefit.
The Minister will have to explain more carefully the reason for this additional cohesion fund. Will it be able to do anything that the existing European development fund cannot do, or does not have the facilities to do? It seems to me that the European regional development fund is quite adequate. Indeed, it is better formulated to assist the really needy regions. It seems to me that the cohesion fund is simply a means of allocating money, through another institution, to discriminate in favour of four nations and to damage the interests of more needy regions.
I should like from the Minister a response to my earlier interjection about the Edinburgh decisions. The 535 Government deserve some praise for the way in which they secured an agreement on the budget. That agreement should be contrasted with the claims of some countries and, of course, of M. Delors himself. The compromise was reasonable in the circumstances. But there is a matter in respect of which I have not seen the figures and would like an explanation. When we are agreeing on the raised ceiling of the European budget, how will the cohesion fund fare?
What is the separate figure for the entire cohesion fund? When the Minister answered my earlier intervention he included the funding for the European regional development fund in the cohesion fund. We need to know the amount of the cohesion fund on its own. How much is to be allocated to the four sovereign states that are to benefit from it?
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The cohesion fund is a mistake. We should stick to the European regional development fund and help the needier regions in the Community. The cohesion fund presents a further problem for us in the United Kingdom. Some members of the Committee have spoken as though the cohesion fund would benefit the United Kingdom. They do not seem to realise that the United Kingdom will not receive one penny from the cohesion fund. The United Kingdom is fully excluded from the benefits of the cohesion fund.
However, one way in which we are not excluded from it is that we shall be one of its main financiers. The United Kingdom and Germany will have to provide most of the money for the European cohesion fund.

§ Mr. Garel-Jones
I must correct the right hon. Gentleman. Due to Britain's abatement, the Federal Republic of Germany and France are the main contributors to the cohesion fund. The Federal Republic contributes, I think, 30 per cent. and the French about 20 per cent. The rest of the money comes from the other richer countries, and Britain contributes 5 per cent. Therefore, the right hon. Gentleman was not quite correct.

§ Mr. Taylor
Yes, but our European partners consider the abatement a temporary arrangement. As the Minister well knows, they are trying to get it removed.

§ Mr. Garel-Jones
It will last until the end of this century, and even then can be changed only by unanimity.

§ Mr. Taylor
That was not the view of those who attended the European Council. Some of them were arguing to have it changed at once. That is the problem —the abatement is being challenged.

§ Mr. Garel-Jones
The right hon. Gentleman is absolutely right. Some countries wanted the system changed, but it can be changed only by unanimity—it will need our assent—and cannot even come up for discussion until the end of the century.

§ Mr. Taylor
As the Minister has said, the problem of financing the cohesion fund rests mainly with France, Germany and the United Kingdom—even with our abatement. The position will be worse if the abatement disappears.

§ Mr. Jenkin
Is it not absolutely obvious that our European partners, which are desperate for us to ratify the 536 treaty, are hardly likely to commit the grievous political error of clobbering us by taking away our abatement? When they have obtained their treaty, it may be a different story.

§ Mr. Taylor
I fully understand that. The Minister understands collusion, and I think that he will understand what the hon. Gentleman is getting at. In Europe, things are done step by step. I think that the Minister said that the cohesion fund was part of a deal.

§ Mrs. Dunwoody
A bargain.

§ Mr. Taylor
Yes, a bargain. We bargained with four countries that they, and they alone, would receive money from the cohesion fund as long as they took certain actions.

§ Mr. Garel-Jones
I shall not intervene in the right hon. Gentleman's speech again, I promise. The arrangements made at Edinburgh—which constituted a deal—set the financing of the European Community until 1999. The British abatement will not be discussed again until 1999, and can be altered only by unanimity.

§ Mr. Taylor
That does not change the main thrust of my argument. Even the Minister has confirmed that Germany, France and the United Kingdom will be the three main financiers of the cohesion fund. That must mean that we will have to find funds from our own national budget, which will probably lead to an increase in value added tax in the United Kingdom, in order to help finance the cohesion fund so that money can be given to the four other countries.

§ Mr. William Cash (Stafford)
The right hon. Gentleman may recall that, at the Edinburgh summit, special provisions relating to the eastern part of Germany were made to the cohesion fund. Those provisions were not well publicised, but I think that the figure was about 18 billion ecu—it may have been £18 billion, I am not sure. It was a substantial sum, which was kept very much under wraps.
Does not the right hon. Gentleman agree that the fact that the Germans are making a contribution is offset by that additional amount? Bearing in mind the formula for the qualification for the cohesion fund—which is, I think, 90 per cent. of the average of the gross national product of the Community—how is Germany to make any contribution at all?

§ Mr. Taylor
The hon. Gentleman has raised the issue of eastern Germany's special position, which I had totally forgotten. It helps to undercut the argument of the Minister when we realise that Germany may be making a major contribution, but some of it will come back to eastern Germany.

§ Mr. Garel-Jones
I have now checked, and the figures are even better than those that I gave the right hon. Gentleman earlier. He started by saying that Britain and Germany were paying for the cohesion fund. That is not correct. Germany and France are paying substantially more than the United Kingdom, as is Italy. Although I do not have the figures to hand, I would not be surprised if other countries were doing so as well. We are paying 5 per cent. of the cohesion fund.

§ Mr. Taylor
The United Kingdom is one of the main financiers of the European Community budget, of which the cohesion fund will be a part.

Mr. Garel-.Jones
We can discuss the budget under other groups of amendments, but I think that the right hon. Gentleman will admit that his original point was entirely inaccurate.

§ Mr. Taylor
No, it was not. The Minister is confirming it. He is saying that France, Germany and the United Kingdom—and he has just added Italy—are some of the main contributors to the cohesion fund.

§ Mr. Garel-Jones
The right hon. Gentleman opened his remarks, as Hansard will show, by saying that the United Kingdom and Germany financed the cohesion fund—they were the biggest contributors. I see that hon. Members are assenting to that proposition. From memory, I was able to say that Germany paid 30 per cent., France 20 per cent. and the United Kingdom—because of its abatement—only 5 per cent. I have now been told by my advisors that Italy contributes substantially more than the United Kingdom. If the right hon. Gentleman wants to discuss the budget, that is another matter, but it is important to nail the fact that he commenced by saying that the United Kingdom and Germany were the biggest contributors to the cohesion fund. That is not correct.

§ Mr. Taylor
It will be once the abatement disappears, and the thrust in Europe is to get the abatement removed, which will happen step by step. The thrust in Europe is to remove, in time, the British abatement which was negotiated by Mrs. Thatcher.

§ Mr. Garel-Jones
I do not think that the Committee should allow the right hon. Gentleman to get away with that. It was agreed at Edinburgh that the British abatement should remain unchanged. It will come up for discussion at the end of the century. Of course, the right hon. Gentleman will say that, at the end of the century, it will be changed. However, it is fixed until the end of the century—a substantial achievement by the Government and my right hon. Friend the Prime Minister. The right hon. Gentleman must produce better arguments to underpin what he is trying to say than those that he is presently giving the Committee.

§ Mr. Taylor
The Minister thinks that six years is a long time, but the arrangements will not necessarily last for six years. Those who follow the debate in Europe will know that most European nations are actively campaigning for the abatement to be withdrawn. They will not wait for six years. They may have agreed to that as part of the deal at Edinburgh to which the Minister referred, but once the Maastricht treaty is ratified, they will not hold back six years. The thrust to get rid of the abatement will increase and gain momentum.

§ Mr. Jenkin
The question is not whether we change the budget in 1999 but what budget there is, because the current budget provisions run out in 1999. It may be true that we cannot approve a new budget except by unanimity, but it will start with a blank sheet of paper.

§ Mr. Taylor
I intend to pursue the hon. Gentleman's point about the budget. The cohesion fund is only part of the overall European Community budget and the United Kingdom is one of the main contributors to that budget. Germany contributes even more. As expenditure increases on agriculture, the European regional development fund and the new cohesion fund, it will place a greater burden 538 on United Kingdom taxpayers. Our Government will have to find additional funds to help finance the European community.

§ Mr. Barry Legg (Milton Keynes, South-West)
Is the hon. Gentleman aware that the financial perspective issued at the Edinburgh summit showed that the cohesion fund spending up to 1999 would amount to some 15 billion ecu? The Minister has told us that Britain will contribute 5 per cent. of that, so the United Kingdom will contribute £750 million into the cohesion fund and we will never get a single penny of it back.

§ Mr. Taylor
The hon. Gentleman put that in very straightforward terms. We will have to contribute £125 million a year for the next six years.
The money going into the cohesion fund and towards the increased expenditure of the European Community, which will increase further because of the cohesion fund, will mean that the Treasury will have to find more funds in forthcoming years—£125 million simply as our contribution to the cohesion fund. That must mean additional taxes in the United Kingdom. I suspect that it will mean an increase in VAT throughout the United Kingdom to help finance the increased budget requirements of the European Community.

§ Mr. Ian Taylor
Will the right hon. Gentleman please put his argument in context? He should remember that, despite the abatement we already have, the total controlled expenditure of the United Kingdom Government next year is £244.5 billion, so the sums of money that he mentions are not as critical to the overall budget as he makes out—and indeed many of us think they are going to a rather good cause.

§ Mr. John D. Taylor
That is an extremely interesting argument from a Conservative Member. He suggests that £150 million here or there is not terribly important to the national budget of the United Kingdom at a time when we are embarrassed by our public borrowing requirement. I fear for the future of the nation if the Conservative party thinks in that way. Now is the time to control public expenditure and not to dismiss £150 million here or there as if it were of no consequence.

§ Mr. Ian Taylor
The right hon. Gentleman cannot abuse my argument in that way. I said that that was a controlled total, so by definition it is controlled and the money is allocated within it. I was attempting to show the proportionality.

§ Mr. John D. Taylor
Proportionality is control, and I hope that the Government will stand over those controls in the forthcoming year as they prepare their budget. If it is controlled, the Government will have to decrease expenditure here in the United Kingdom in order to find extra funding to allocate to Europe.
I suspect that we will have increased taxes and VAT in the United Kingdom because of the increased budget of the European Community, partly because of the new cohesion fund. It hurts us in Northern Ireland to think that VAT may be increased to pay for the new cohesion fund which will to to Greece, Spain, Portugal—and, of course, our neighbours in the Republic of Ireland.

§ Sir Russell Johnston
As far as I can see, the right hon. Gentleman has produced no evidence whatsoever that the measure will result in VAT and tax increases. He should 539 also note the second point raised by the hon. Member for Esher (Mr. Taylor)—that the money was going to a good cause. Is he not at all interested in benefiting the poorer areas of the Community? If he is not, other people might not be interested in helping him with his problems.

§ Mr. Taylor
It all depends on what one understands by a good cause. I believe that the more needy regions of the United Kingdom would be a good cause. However, instead of getting money from the European Community for the regions within the United Kingdom that need support, the Government have decided, as part of a deal, to use the Minister's words, to give it to four particular nations. We are being asked to help finance that.
Finance has to be found somewhere. It comes from taxes, and no Conservative Member can run away from the fact that the cohesion fund and the increased budget requirements of the European Community will mean that extra money will have to be found in the United Kingdom to help finance those four beneficiaries of the cohesion fund. That will lead to increased taxes throughout the United Kingdom, and I suspect that VAT will also increase. It will be resented throughout the length and breadth of the United Kingdom that we are being asked to increase taxation to help finance four countries which in some respect are much better off than some of the regions of England, Scotland, Wales and Northern Ireland.

§ Rev. Ian Paisley
The Committee is getting more and more interesting because rules are coming into operation as our debate proceeds. Earlier today, the Minister would not let me intervene in his speech. I thought that that was what Committee work was all about—not for making Second Reading speeches but for the Minister to help us to understand what he was doing. He said that he would not let me get in because I was going to make a speech. He then allowed all and sundry to get in, but I was not allowed to intervene because I was going to make a speech. I know that the Minister is anxious to explain now. He may lower his glasses almost to the tip of his nose and smile with the bedside manner of an old village doctor telling his patient that all is well, that heaven is in front of him and he will escape purgatory, but those are the facts.
Even the Chairman told us at the beginning of the debate that he would be absolutely fair to all sections of the United Kingdom. I have attended all the debates except one and only now am I able to speak. The other night when I tried to speak, the Minister contrived to close the debate; now he is about to tell us how much he loves Northern Ireland and how much he hates me.

§ Mr. Garel-Jones
I think that the hon. Gentleman understood the point that I was making. An hon. Member representing Northern Ireland has said on a point of order that Northern Ireland Members had a particular interest in the debate, and as they wished to return to the Province later in the day were keen to get in quickly. The only point that I was seeking to make to the hon. Gentleman in all friendliness was that I did not want to take up the Committee's time in such a way as to cause inconvenience to hon. Members such as himself.

§ Rev. Ian Paisley
I find it strange that the Minister is now dividing the House into the nations which make up 540 the United Kingdom. If a Labour Member from Scotland said that many people from Scotland wanted to speak, he could not rule out Conservative Members but allow all other hon. Members from Scotland to speak.

§ Mr. Nicholas Budgen (Wolverhampton, South-West)
The hon. Gentleman should appreciate that he has a very special and important position in the House and is in general given a justified preference, particularly over run-of-the-mill English Conservative Members. He is frustrated and angered at the way in which he has not been able to speak, but let him consider for a moment the frustration and anger of those of us who have sat here day after day, constantly excluded, finding it possible only to make an intervention. He should understand the sense of resentment which permeates the Committee.

§ Rev. Ian Paisley
I certainly appreciate how all hon. Members feel about the debate because the ramifications and the influence of what we are doing now will affect every part of the United Kingdom. I fail to understand why we cannot have more time to debate these matters. The House does not do itself justice when people throughout the country are asking why, if the Government have an unassailable position, they are so afraid to have a debate.

§ The Second Deputy Chairman of Ways and Means (Dame Janet Fookes)
Order. The hon. Gentleman has made his point. He now has the floor and the opportunity to discuss the group of amendments under consideration.

§ Rev. Ian Paisley
Thank you, Dame Janet. If I had not been led on to By-path Meadow by the Minister, I would not have been in the delectable country that I wanted to traverse, so I shall come back to the straight and narrow way and talk about the cohesion fund, which I think is in order.
The Minister has made some amazing statements which do not go with the forecasts that even the Treasury put to us about the fund. I have a copy of the report of a Treasury committee on the perspective that was agreed on the basis of Edinburgh. The Minister talks about the cohesion fund being 5 per cent. but the perspective from the Treasury committee said that in 1993 it would be 2.2 per cent., in 1994 2.5 per cent., in 1995 2.8 per cent., in 1996 3.0 per cent., in 1997 3.2 per cent., in 1998 3.1 per cent. and in 1999 3.1 per cent. The figures that I shall put are not on the Minister's basis of 5 per cent., so we can almost double the amount when we talk about what we shall be contributing to this fund.
As the Minister is in such good answering form at present, can he tell me the basis of the proportion that we shall have to give to the cohesion fund? Is it a percentage of our overall European Community contribution? That, of course, includes the rebate, so the rebate cannot be used in the argument. Is it a percentage of the total overall contribution that we make? I see the Minister nodding.

§ Mr. Garel-Jones
As I have indicated to the Committee, Dame Janet, I will seek to catch your eye at a later point in the debate, and I will reply then.

§ Rev. Ian Paisley
As this is a Committee, there is no point in my building an argument on something that you now disagree on. You have nodded your head. I take it that you agree with what I have said. You do not agree? Then tell us why.

The Second Deputy Chairman
Order. I remind the hon. Gentleman that he should address me in the Chair rather than the Minister directly.

§ Rev. Ian Paisley
I am very sorry, Dame Janet, that the Minister will not give me an answer on this. The fact is that the United Kingdom contributes to the cohesion fund in proportion to what it contributes to the overall European Community budget. One would like to know the specific figures, the amount of money, that we have to give to the fund.
Let us first look at what the fund is about. The hon. Member for Inverness, Nairn and Lochaber (Sir R. Johnston) talked about good causes. I think that by that he means the poorer regions of Europe. There is no difference between poor regions, whether they are in Italy, Greece, Portugal, Spain, Scotland or Northern Ireland, but the European Commission and Mr. Delors did not think about the regions arid did not deal with the regions: Mr. Delors dealt with the countries that he desired to bribe or buy into the Maastricht treaty.
We heard this from the southern Irish politicians when they were selling Maastricht. They told their people that they were getting £3 million a day from Europe and that if the people voted for Maastricht the figure would go up to £6 million. That was their message, with Garret FitzGerald at the head of a European crusade in his own country. If the Parliamentary Under-Secretary of State for Scotland, the hon. Member for Eastwood (Mr. Stewart), could offer the people of Scotland £3 million a day and tell them that if they voted for Strasbourg it would go up, he might possibly be on a winner. Or perhaps the Scottish people are different and feel that there are more valuable things than £6 million a day. I hope that that would be true of many of the Scots people, especially in the islands.
This was a buy-out settlement for those people. They were told that this would happen. The rage generated against Denmark and the rage generated against this House and the Prime Minister of the United Kingdom was all about the cohesion fund and the fact that they would lose out. We have heard a lot about helping one another, about the great European ideal and the great unity that we should have in Europe. Why cannot the European Commission, the Council of Ministers and the European Parliament unite to help all the poor regions and spend this money in all the poor regions?

§ Mr. Ieuan Wyn Jones (Ynys Môn)
I am following the hon. Gentleman's argument carefully, but I am not sure whether the hon. Gentleman is arguing against cohesion funds or in favour of cohesion funds applying to more countries than they currently do.

§ Rev. Ian Paisley
I am arguing that if one has a cohesion fund and one tells people that it is for the poor regions, it should be for all the poor regions if one is a European. If one is a nationalist from the south of Ireland or from Portugal or Spain or Greece, then one would argue for giving nothing to Northern Ireland or to Scotland and for giving all the cohesion money to one's own country. I totally oppose that, and I hope that the hon. Gentleman opposes it, too. He would like to see a fair share of the cake for Scotland—

Several hon. Members
Wales.

§ Rev. Ian Paisley
I am sorry—Wales. He is a Celt, anyway, and we in Ulster have a bit of that in us, too. Perhaps we have some collusion—I think that that is the word.
If we have this cohesion fund, Britain will be a large contributor. I have heard that challenged by the Government Front Bench as well. It is important to note that the contributions each year are taken on the basis of the overall money that a particular country pays to Europe that year. Sometimes France, for example, does not make any real payment to Europe. The French contribution has gone up and down like a yo-yo. We want to see what the scale will be because that is what decides it.
Why does the Minister not stand up and tell us exactly how much money we shall have to give to the fund? He says that it is 5 per cent. On the figures that I have quoted from the Treasury document, over the first five years the cohesion fund will be 10 billion ecu—£8 billion—and the United Kingdom will contribute £144 million for the first year, with the figure rising each year thereafter. That is on the figure of 2.2 per cent., but the Minister says that it is 5 per cent. —so we can double it, making it nearly £300 million. The 5 per cent. is the Minister's figure, not mine.
The right hon. Member for Strangford (Mr. Taylor) replied to an hon. Member on the Government side who said it is all right to say that we can give so many million here, so many million there and so many million somewhere else, but from all over the House I hear cries for hospitals, roads, schools, nurses, and so on. We do not have the money to hand out in this way. If this money is handed out to the south of Ireland, it will do down the economy of Northern Ireland. The House should remember that. Under this fund there will be a special emphasis on transport—and transport is the key to the economy of the south and to the economy of the north of Ireland. When the channel tunnel opens, it will be all important to the people of Northern Ireland and of the south of Ireland. Money will be poured in by the people of Northern Ireland to create a transport structure which will help the economy of the south of Ireland while the people of Northern Ireland will not enjoy that benefit.

§ Mr. Cash
Is the hon. Gentleman aware that one of the other criteria for obtaining cohesion funds is compliance with the convergence conditions? Does he appreciate that in the existing climate it is highly improbable, from all that we can tell, that there will be compliance with those conditions? It is therefore not just a question of bribery on a massive scale. Far more dangerous even than that, perhaps, is the raising of expectations that will be unfulfilled, as a result of which there will be a complete reversal of attitudes towards the Community. That will help to destroy the benefits of the Community's existing arrangements rather than enhance them. That is an extremely dangerous situation, given the uncertainty of the political landscape in Europe as a whole.

§ Rev. Ian Paisley
The hon. Gentleman is absolutely right. Mr. Bangemann, a former German Finance Minister and a vice-president of the Commission, is well known to members of the Committee, and I have sat with him in all the elected Parliaments of Europe. I asked him what would happen and he replied, "As a matter of fact, we have a problem with eastern Germany. The people here think that we are to be the paymaster. They will get a 543 shock. We have to achieve convergence between eastern and western Germany before we can achieve convergence with the rest of Europe." That will be costly, and does anyone think that Germany will finance it—or that the British public will be prepared to wear other countries getting the things that Britain needs?
I am sure that the people of Scotland and Wales are worried about their transport infrastructure. Their worry is justifiable, because transport will be all-important in the future business and economy of the United Kingdom. Why must we give to others that which we need for ourselves? We must consider that very realistically.
I do not know what will happen when the Minister stands at the Dispatch Box in the future and announces cuts here and cuts there in this country's spending on the necessities of life, while the cohesion fund goes on and on.

§ Rev. Martin Smyth
Reference was made to good causes. I follow the hon. Gentleman's argument about money for the regions. Is he aware that the Republic of Ireland boasted recently about the higher rate of social benefits that it pays to pensioners and others compared with our nation? Also, at a time when our industrial base is being eroded, Spain has a record of enjoying the fastest industrial growth in Europe. Is it not strange that those two countries should be earmarked to benefit from the cohesion fund rather than regions in our own nation where there is tremendous need?

§ Rev. Ian Paisley
I am trying to put that argument to the Committee. It is a solemn matter, and one that we must all consider. Certain nations are boasting of their prosperity and how well they are doing, while this country has suffered a series of cutbacks. No matter how optimistic one may be, no one imagines that the future will be rosy. Those of us who are close to the people know something of the agony of unemployment and its effect on our country.
The British people, no matter from which part of the nation they come, would be happy if a fair playing field existed, so that all regions with the same difficulties received the same amount from the cohesion fund. Then there would be an argument for the fund. But that is not happening—the fund discriminates against countries outside a group of four nations, although they share the same problems, sometimes to a greater degree.
We should have been given time tonight thoroughly to debate that matter. I should like to see the Minister of State in his place, ready to answer those questions. If the figures that I gave are not correct, this is the time freely to debate them. Instead, this is being changed into a Second Reading debate, with the Minister replying at the end—though because of lack of time, he will probably say, "I am sorry, I cannot answer."
I should like to know how much this country is to contribute to the cohesion fund. Is the Treasury committee document right or wrong? Will the figure be 2.2 per cent. or 5 per cent.? Do we pay a proportion of our entire EEC contribution or not? If we do, what is the proportion? The Committee should concern itself with those questions.
As to countries which will benefit from the cohesion fund, mention has been made of their presence in other activities. Let us take Spain as an example. Anyone who knows about the fishing industry knows of the rage against 544 Spain. Northern Ireland has a small but able fishing fleet, and one which makes a valuable contribution to Northern Ireland's economy. Spanish boats can come in and poach —lawfully, their owners say—in our waters and take away our fishermen's livelihoods. The fishermen say to me, "Why is it that the British Government are giving them special grants? Why do we have to pay, by way of taxes, into their special fund?" How does one answer that? How does the Minister answer that?

§ Mr. Cash
If the hon. Gentleman does not receive a reply from my right hon. Friend the Minister, perhaps he would care to reflect on remarks made by my right hon. Friend the Chancellor of the Exchequer in January 1991, when he said that the consequences of going down that route, including a single currency, would create difficulties. He said:
A programme of transfers—potentially huge—would be very difficult for the more prosperous countries to take. Even on present policies"— and that does not include the deal that has just been concluded— by 1993 we will be funding a structural policy costing between £11 billion and £12 billion each year."—[Official Report, 24 January 1991; Vol. 184, c. 478.] That was my right hon. Friend the Chancellor taking a fairly effective potshot at the arrangements, which have been made considerably worse as a result of the Edinburgh deal.

§ Rev. Ian Paisley
That brings us to the balance between the cohesion fund and the structural fund. I noticed that the Minister tried to tie them together, so that we would not have a clear perspective of the cohesion fund apart from the structural fund. However, we also pay a large slice of the structural fund. Figures from the Treasury committee show that the United Kingdom's contribution will be 30.8 per cent. in 1993; 31.3 per cent. in 1994; 32.4 per cent. in 1995; 33.2 per cent. in 1996; 34 per cent. in 1997; 34.9 per cent. in 1998; and 35.7 per cent. in 1999. That is the extent of our contribution to the structural fund, over and above that to the cohesion fund.
Let me say a bit about the Committee of the Regions. There is a social committee in Europe. I am a Member of the European Parliament, but I have never met the Northern Ireland members of that committee, and I do not know what they do; I should like to know.
What we are setting up is not a national quango, but a European quango. The Government seem to be resisting the idea of elected representatives being on the Committee of the Regions. Why is that? The Government say that this or that section of the people should be represented, but elected representatives represent all sections of the people, and hope to obtain votes from all sections of the people. If we argue that the commitee must have an agricultural representative, and representatives from medicine and education, for instance, where will it all end? Who will be left out, and how will the choice be made?
I differ from the right hon. Member for Strangford (Mr. Taylor), who comes from my own part of the United Kingdom. I do not think that all the Tories are joining the Unionists, or that the majority are doing so. Of course, some Unionists joined the Tory party; now they are returning to their first love, which may be deemed a good thing or a bad thing. But there will still be Tories in Northern Ireland—and, if even one were elected to represent a Northern Ireland constituency, he might be an appropriate member of the committee. If members are 545 chosen in the same way as members of other quangos, those who have too many votes will not be in; only those who have fewer votes succeed, and they usually lose the seats that they have gained at a subsequent election. They have a consolation prize, at least.
We should take a strong line on this: we should ask for elected representatives, and we should require their representation to be in proportion to the representation of their parties in the areas that they represent. I also believe that there should be three members from Northern Ireland.

§ Ms. Quin
Earlier, a Conservative Member made a suggestion about the National Farmers Union, and another mentioned a banking representative. If we followed such advice, would we not simply duplicate the work of the economic and social committee, which already represents business, trade union and other interests? I agree with the hon. Gentleman that elected representatives would be far more appropriate.

§ Rev. Ian Paisley
This is, indeed, a time when we should have elected representatives on the committee. They know what the people are thinking, and they have to go back to the people. Surely some sort of accountability should govern the arrangements. To whom will the commit tee be accountable, if not the people whom it is supposed to represent?

§ Mr. Iain Duncan-Smith (Chingford)
Is not this the key factor? We are debating crucial funds, and much of the control over them lies with the Commission. The whole point is that the Commission will be empowered to look at those whom they wish to favour and those whom they do not. I believe that the funding will become retrospective.

§ Rev. Ian Paisley
Those who are in favour of Mr. Delors and Europe will move forward; those who happen to be against them will not move forward. I am the only Member of Parliament who sits on the enlarged bureau, and I have seen the shenanigans that go on between parties. Even Mr. Delors is a member of that distinguished gathering, as it is called, and I have seen the way in which he manipulates it to get his way. After all, Mr. Delors is the man sitting in the Commission who will eventually say how the funds will be used.

§ Sir Russell Johnston
The hon. Gentleman describes Mr. Delors as "manipulating people to get his own way". Has he never manipulated anyone for that purpose?

§ Rev. Ian Paisley
I submit myself to the electorate, and I happen to get a larger vote than any other Member of the European Parliament. I do that by telling the people what I stand for, and they like that. The hon. Gentleman stood for membership of the European Parliament, but the electorate did not like him. He was not able to manipulate people. I was not trying to do so; I believe in fair, honest representation, and I believe that there should be no buy-off.

§ Mr. Roy Beggs (Antrim, East)
Does the hon. Gentleman agree that there is tremendous suspicion in Northern Ireland at present? It is suspected that, should cohesion funds go to the Irish Republic because of shenanigans, scheming, manipulation and deals made in 546 various places, they might just be used to get new ships to compete against Northern Ireland's existing transport arrangements.

§ Rev. Ian Paisley
That is possible. The Government of the Republic has made such a proposal twice; it was turned down both times, and is now being considered for a third time.
The hon. Gentleman represents an area that I used to represent before the redistribution of seats. He knows how valuable the port of Lame is to the economy of Northern Ireland. He also knows that an effort is now being made to make those who travel from the south stop using the Larne ferries. Yet the money given by Europe was intended to establish that port and help it, so that it could aid both north and south. Now, money is to be given to the south to destroy what Lame was funded to do. I have asked the Transport Commissioner about this. What is the use of spending money in that way when the port has been helpful to the whole of Ireland? Fleets come to the south and use it, but now the aim is to divert that traffic.
When I was in Europe recently, I was shown a map on which the ferry service was not even marked. There was a little circle over the Holyhead route, indicating that the availability of funds was being discussed. I believe that everyone has the right of access to a port in their country, but I do not believe that it is right to try to develop a port in the south of Ireland which will take traffic away from Larne, which has been established with the help of EC money.
The south of Ireland received special funding for culverting roads, which was not made available in the north. That was for the preparation of the road network for strengthening in the south to take traffic away from the north. If there is competition, we can have it; but I do not believe that European funds should be used to help one part of the Community to the detriment of another. That is my objection to the cohesion fund, and to the whole proposal.

§ Mr. Peter Hain (Neath)
I wish to deal specifically with amendments Nos. 102 and 103, to which my hon. Friend the Member for Kingswood (Dr. Berry) and I have put our names.
Both the debate and the amendments are important. This area of policy bridges the gap between the constitutional and economic arguments for democratic reform of the European Community. I concede that the treaty undoubtedly makes some advance in that respect. For example, the protocol on the cohesion fund provides for financial transfers to improve the infrastructure of the four poorest countries—Greece, Portugal, Spain and Ireland. The protocol also specifies an enhanced role for the EC structural funds, principally the European regional development fund and the European social fund. Between 1989 and 1992, the structural funds doubled in size to 14 billion ecu and have since increased to 19.7 billion ecu for 1993. They are due to rise to 27.4 billion ecu by 1999.
Article 198a of the treaty establishes the Committee of the Regions which will consist of representatives of regional and local bodies". Although it is a purely consultative body, it would be an important voice for the regions. That is very welcome, but it will be a toothless committee. The treaty's fatal flaw is the absence of a coherent and credible EC economic and 547 industrial strategy. It echoes the failures of Britain's Thatcherite obsession with monetarism in the early 1980s and, indeed, throughout most of the 1980s.
Last year unemployment in the European Community was driven up to nearly 17 million, or 9 per cent., which is significantly higher than the 7 per cent. average for the 24 countries in the Organisation for Economic Co-operation and Development. In the 1970s, by contrast, EC unemployment rates were lower than the average for the OECD. This year, we are looking to 20 million unemployed. According to the OECD, under the present monetarist policies enshrined in the Maastricht treaty, we can anticipate average unemployment across the Community increasing still further to 16 per cent., or 30 million, by the end of the decade—nearly double the figure for last year.
That total is absolutely horrifying. I believe that it will result in the social disintegration of Europe unless there is a radical change in the economic policy and economic perspective of the Community. Unless there is such a radical change, the whole European project will collapse. The regional dimension is absolutely critical in developing and pressing for that change.

§ Mr. Cash
The hon. Gentleman is pursuing an argument which is absolutely central to the direction in which the exercise and enterprise of Maastrict is going. Underlying the treaty there is a deliberate policy to create unemployment and to cut public expenditure. Whatever party one belongs to, the hon. Gentleman's arguments must be answered, not only by Ministers but by people outside, namely the trade unionists and others who support the Opposition. To what extent are they listening to the arguments of the hon. Gentleman and his colleagues?

§ Mr. Hain
I welcome the hon. Gentleman's comment and I also welcome him to the stable of supporters of public expenditure and government directed at that objective. I hope that the trade unionists and others who have backed the Maastricht treaty because it brings the social chapter, if not in Britain, elsewhere will consider the economic arguments more seriously, especially as they affect the so-called peripheral regions.

§ Mr. Llew Smith (Blaenau Gwent)
I want to take up the point made by the hon. Member for Stafford (Mr. Cash). The 3 per cent. budget deficit is likely to result in public expenditure cuts of about £12,000 million. Will my hon. Friend hazard a guess at the effect on the valley communities in south Wales which have traditionally relied on a high level of public expenditure? Can he explain how people, including members of our Front Bench, can vote for £12,000 million of public expenditure cuts when they vote for the treaty?

§ Mr. Hain
I think that the figure of £12 billion expenditure cuts is probably on the low side. However, I shall not pursue that idea for fear of being reprimanded, Dame Janet. My hon. Friend makes a valid point.
Part of the problem is that the otherwise worthy objective of monetary union is being pursued without a coherent policy for growth or reflation and without any policy for full employment. In fact, the monetarist policy backed by rigid fiscal controls, notably on public sector 548 debt and deficit, is imposing such a narrow economic framework on the whole of Europe that without any serious offsetting policies, which are not offered in the treaty, unemployment will increase savagely in the less competitive regions. Wales is an example of where that will happen.
Within the existing nation states, changing levels of competitiveness have a different impact on different regions. They mostly result in changing levels of employment and unemployment. Within the context of an EC regime of monetary union, a worsening of member countries' competitive position will inevitably lead to rising unemployment unless there are offsetting interventionist policies directed especially at the weaker regions of those member states.
In the absence of such interventionist policies, we have clearly seen how even the ERM's limited monetary union contributed to the deflation of the United Kingdom economy and a hike in unemployment towards 3 million in the past two years of membership. In existing nation states' monetary unions there is substantial Government intervention of one type or another. It often takes the form of supply-side policies such as active regional and industrial programmes and redistributive budgets. Even if, as we have regrettably seen in Britain in the past 14 years, such policies are not pursued with the necessary vigour, national Governments still appropriate and spend about 40 per cent. of national income. Therefore, to some extent, fiscal policy redistributes income between the most prosperous and the less prosperous regions.
How does it do that? Regions with rising unemployment automatically receive a fiscal stimulus through a boost in benefit payments and a reduction in tax revenues. That is a type of automatic stabilising mechanism. Of course, in some cases, much more formal redistributive mechanisms operate, such as those between the states in Germany.
The implications are clear. If we support monetary union, the inescapable logic is to argue for much larger centralised European budgets and/or—preferably both—automatic redistributive mechanisms as well as highly interventionist regional and industrial policies. Without them, monetary union will be a reactionary step. We are already seeing the effect.
That is one of the central problems of the Maastricht treaty. It provides neither the redistributive nor the supply-side mechanisms to counter the harmful effects of monetary union and its impact on the less competitive regions.

§ Mr. Calum Macdonald (Western Isles)
I take the hon. Gentleman's point, but will he acknowledge that nothing in the treaty rules out such a supply-side policy should it be decided by the Community collectively? The Commission, notably, the President of the Commission, has proposed exactly such a reflationary policy to get the whole European economy going and to tackle the problem of unemployment. Nothing in the treaty rules that out; it is a matter for the Governments of the Community to pursue such a policy.

§ Mr. Hain
On the contrary. With all due respect to my hon. Friend, everything in the treaty rules that out. The economic deficit constraints, the monetarist regime and the 3 per cent. limit on budget deficit are driving us towards meeting the convergence criteria for monetary 549 union which will block any hope of the redistributive supply-side mechanism which he appears to support. The crucial point is that monetary union in the European Community will be expected to operate without a central European budget of any significant size.
Even under the recent settlement, itself substantially reduced from Jacques Delors' original proposals, the EC budget will be only 1.15 per cent. of total Community gross national product. Frankly, that is petty cash. It provides no basis for regenerating the economies of the deprived peripheral and less competitive regions Most studies suggest that at least a fourfold increase in the European Community's budget would he required to meet the scale of the challenge. Even if we ignore how the existing budget is allocated, for example the totally inadequate amount that is devoted to reducing regional imbalances and the hugely wasteful agricultural subsidies, it is totally inadequate to provide the effective redistributive mechanisms that we need at the level of the Community.

§ Mr. Macdonald
Will my hon. Friend take on board the fact that the 3 per cent. deficit levels are not absolutely fixed? Community Governments can decide whether to apply them in the light of prevailing economic circumstances. Obviously, when they are as my hon. Friend describes, it would be sensible for those Governments to take a flexible view. Even in terms of pursuing national policies, national Governments will inevitably run into constraints in trying to run large-scale deficits year upon year. Such problems need to be tackled collectively across the Community rather than by individual nation states.

§ Mr. Hain
Again, I do not want to pursue that point too far, but I need to answer my hon. Friend's point. If the 3 per cent. limit and the 60 per cent. limit and so on are meaningless, why are they in the treaty? If they do not add up to a row of beans, why are they set in concrete in the treaty? Indeed, they are set down so explicitly that, if one does not meet them, one is fined. There is actually a provision in the treaty to fine defaulting member states for not meeting them. I do not accept my hon. Friend's point.

§ Mr. Llew Smith
Will my hon. Friend confirm that we are discussing a legal document, not just a statement that was made by a politician on a wet Sunday afternoon?

§ Mr. Hain
Indeed, we are discussing a legally binding document which binds all member states, if they are to meet the criteria for acceptance into the final stage of monetary union, precisely to meet those convergence criteria, with all the horrendous consequences for areas such as the south Wales valleys in terms of cuts in public expenditure on a colossal scale. My hon. Friend the Member for Blaenau Gwent (Mr. Smith) probably underestimated when he mentioned the figure of £12 billion. The figure is more likely to be £25 billion at the current level of budget deficit.

§ Mr. Rowlands
Will my hon. Friend draw to the attention of the Committee the fact that the protocol is not only in the treaty but in the Bill? We will actually write it into our legislation as well.

§ Mr. Hain
My hon. Friend makes a valid, valuable point which enthusiastic and somewhat blinkered supporters of the treaty ignore at their peril, and certainly at the peril of my constituents.

§ Mr. Cash
On the hon. Gentleman's point about the amount of payments that are being made into the European Community and the remark by the hon. Member for Blaenau Gwent (Mr. Smith) on the fact that this is a legal framework, does the hon. Gentleman agree that the whole arrangement is highly centralising and fundamentally undemocratic and authoritarian, as a result of which, the greater the competencies become, the more money will be sucked into the centre, with corresponding decline in the democratic quality for those who, for example, might become involved in the Committee of the Regions or whatever, precisely because the main power will lie with those who run the system? That is the absolute acme of all parliamentary arrangements that have taken place over the century. At the bottom line, the authority and the power go where the money is, and it will be an undemocratic and authoritarian system.

§ Mr. Hain
The hon. Gentleman makes a valid point to which I shall return, but I wish to develop the point that I was making.
In the absence of a central budget and redistributive supply side mechanisms and a highly interventionist policy from the European level, monetary union will have a deflationary impact on less competitive regions, leading to increased unemployment, especially for regions such as Wales which, in EC parlance, are regarded as being on the periphery. On top of that, the transitional terms for monetary union require policies that will impose deflationary—

§ The Chairman
Order. The hon. Gentleman is now straying rather wide of the amendments. I have given him some latitude, and I think that he recognised that in some of his earlier comments, but I ask him to address the amendments.

§ Mr. Hain
I am grateful for your guidance, Dame Janet. All that I plead in mitigation is that I was led astray by hon. Members taking me down certain byways.

§ The Chairman
That is a well-used argument, but it is not accepted by the Chair.

§ Mr. Hain
Indeed, Dame Janet.
I am sure that you, Dame Janet, will accept that my next point is absolutely crucial in the context of regional funds and regional policy generally. There is a real danger of European Community growth and wealth being concentrated at its hub—that meets the point made by the hon. Member for Stafford (Mr. Cash)—the hub being western Germany, France, the Benelux countries, perhaps northern Italy and perhaps the south-east of England if we are lucky. Meanwhile, the periphery, including areas such as Wales, will decline. Unless there are very strong and heavily funded EC regional investment policies, vast areas of the European Community will become poorer. Following capital to the hub, political power will he increasingly centralised, as sure as night follows day. Those economic imperatives undermine the importance that the modern European Community rightly ascribes in theory to the regions. In one sense, the political thrust of European Community evolution focuses on the centre and 551 the regions, with the national level receding in influence. Links between Brussels, for example, and Catalonia or Wales, if we are lucky, might override links with Madrid or London. EC structural funds are geared towards such redistribution or compensation at the regional level. The problem is that the economic imperatives that I have described mean that we have an enormously centralising force which is winning over the regionalising tendency which is in the heart of the Community. The centrifugal forces at work in the Community are triumphing over the centripetal forces and dwarfing them completely.

§ Mr. Jenkin
I wonder whether the hon. Gentleman will allow me to amplify his point about the economic effects of the monetary union that he has described in relation to the regional policies that we are discussing. The regional policy that he describes and would espouse is largely practised in Germany, where there is a monetarist central bank. I am in favour of monetarism—perhaps the hon. Gentleman is not—but he is absolutely right to point out the effect of a monetarist central policy if it is not answerable in some way to the economic demands. That has been demonstrated in the failure of the exchange rate mechanism.
Unemployment in the hon. Gentleman's constituency, which was caused by German monetary policy being imposed on south Wales, is perhaps a portent. I am surprised that Opposition Front-Bench Members espouse that policy.

§ Mr. Hain
I do not think that the unemployment that has been imposed on south Wales is entirely to do with the European Community. Much of it is to do with the Government whom the hon. Gentleman supports. I take the hon. Gentleman's point about the importance of having a regional banking system. We do not have one in Britain. Again, we could address that topic on another occasion. If we are to have regions that are autonomous, powerful and viable in their own right, we need to decentralise our financial structures as well. It is important also that member states have structures of government which mesh into the regionalised Europe. It is significant that, until now at least, the most successful EC country, Germany, has had a federal structure, with significant autonomy delegated to the Lander.
The case for decentralisation is as much democratic as economic. We should insist on an active regional policy for the European Community and democratic methods to facilitate it, including devolution to Scotland, Wales and the English regions. We should press for a strengthening of the Committee of the Regions. They are not optional extras; they are the vital means of ensuring that the regional dimension is not a one-way conduit for hand-outs from the centre but an active channel for empowering outlying areas and nations.
We should also insist on a highly interventionist European investment bank. The aims of such a bank are described in articles 198d and I98e on page 55 of the treaty. While the treaty sets up the structure for the bank, there is no real content to it. There is no indication of the powers that such a bank would have or what its potential could realise.
In Britain in the 1980s, we have seen beyond dispute that investment decisions are much too important to be 552 left to the market. The market has palpably failed to modernise the manufacturing infrastructure. We need a powerful investment bank at the British and European levels, otherwise poorer regions will be left behind. Against that desperate need, regional support and aid has been cut massively in Britain, especially in assisted areas where such support and aid have been slashed.
Since revision of the assisted areas map in 1984, regional financial assistance has fallen from £518 million to £265 million—a cut of 50 per cent. That cut has had an enormous impact on areas such as south Wales, especially the deprived and neglected valleys. Given the size of the planned cuts in the Department of Trade and Industry's expenditure over the next three years, it is expected that the Government's record on regional assisted areas cuts will deepen.
It is important to place this debate in the context of an active regional policy at not simply the European but the British level. For example, what do we find in Wales? Wales has had massive cuts in regional aid since 1979. In the decade to 1991, regional assistance to industry in Wales declined by 58.3 per cent. The valleys in south Wales have been subject to savage job cuts following colliery closures and the collapse of local manufacturing industry. Regional policy expenditure in those valleys fell by 44 per cent. between 1988–89 and 1991–92. That period coincided with the much vaunted valleys initiative programme. Over the same period, regional development grants to the valleys were cut by 86.8 per cent.
When we examine the European dimension to answer the question of what extent the Committee of the Regions, its structural funds or whatever, addressed the glaring shortcomings in British policy, we find that they do not address the shortcomings at any serious level. Partly because of those shortcomings, adult male unemployment in the valleys increased by 11.2 per cent. between October 1988 and October 1992 and now stands at 19 per cent., compared with 13.5 per cent. for the whole of Wales and 13.6 per cent. in the United Kingdom. Yet, against that desperate background, we find that the economic consequences of the Maastricht treaty will make the situation worse.
8.15 pm
I concede that the establishment of the Committee of the Regions is a step forward. It will have advisory status. It will have more than 200 members, 24 of whom will be from the United Kingdom, and it will also have substitute or alternate members. All the members will be appointed—not elected—for four years by the European Council acting unanimously on proposals from the member states. The term of office is renewable, so it could be a jobs-for-life syndrome if we are not careful.
The committee will elect its own chair and officers for two-year terms, but the rules and procedure will go to the Council for approval. Everything will be done on the say-so of the European Council or the Council of Ministers. The Committee of the Regions will be shepherded by the Council but it will be able to meet on its own initiative.
All that the Committee will do is offer opinions; it will not have any powers to speak of. Effectively, it will be a talking shop. One could call it the organ grinder's monkey's monkey in the European context. We need a Committee of the Regions which is powerful.
553 When we examine the impact of the committee's regional policy on Wales, we find that it does not meet the scale of the challenge or the needs of our community. When we specifically examine the opportunities for Wales under the committee's proposals, we find that, despite the fact that the Maastricht treaty suggested that membership should comprise elected representatives of local and regional authorities, the Secretary of State for Wales intends that the Welsh places will be filled by unelected nominees.
The Secretary of State suggested that he might be one of the members. He is flying in the face of the clear precedent which was established, for example, at the consultative standing conference of regional and local authorities in Europe. It has been the case for many years that elected representatives take their seats at that conference. The European Commission has made it clear that the treaty should be applied uniformly across Europe and that Britain should nominate delegates in line with other countries. In a letter sent to Thomas Mega hy in October, the President of the Commission said: The Commission is of the opinion that considering the functions attributed to the Committee of the Regions, the said Committee should consist of elected representatives. That is the reason why it is important for local authority representatives at county and district levels in Wales to elect their representatives to the Committee of the Regions.
It is important to remind ourselves that, if the British Government persist in nominating their own sectarian appointees, they will renege on a ministerial promise made to my hon. Friend the Member for Sheffield, Central (Mr. Caborn) in a discussion in the House on 6 December 1991:

§ "Mr. Caborn
Can we take it that elected members will be representing the United Kingdom on that body, but the formal distribution of that representation has not yet been worked out?

§ Mr. Key
That is how I understand it.".—[Official Report, 6 December 1991; Vol. 200, c. 562.]
In other words, the Minister was saying that he accepted that elected representatives would be members of the Committee of the Regions. We are now invited to accept that that was never the Government's policy.
The Committee of the Regions is supposed to correct the democratic deficit in the European Community. However, if the Secretary of State nominates his placement from Wales, that will make a complete mockery of correcting the democratic deficit. It is neither democratic nor does it correct the deficit. What could happen? The Secretary of State could nominate people from Wales such as the businessman who reportedly acted as his chauffeur during the general election campaign and then was appointed to two Welsh quangos as a result.
In Wales, the British Government has spurned the democratic rights of local people and put Conservative stooges on many of the 80 or so quangos which now exist in Wales. That process is likely to continue unless we have a complete change of policy and the Government accept that they should conform to the rest of the Community's practices.

§ Mr. John Gunnell (Morley and Leeds, South)
Does my hon. Friend agree that the Minister was a little one-sided in the examples he chose to illustrate the question of representation? Shortly after I attended the assembly of European regions, the hon. Member for Wirral, West (Mr. Hunt) suggested that he would represent Wales. The suggestion was greeted with derision by not only the Welsh 554 members but by all members who were present. Members from France, Spain, Italy and Germany took the view that it was a completely nonsensical interpretation of the Committee of the Regions. The Minister was selective in the countries which he chose to use as examples because the countries which I mentioned will have elected representatives from the regions.

§ Mr. Hain
I am glad that my hon. Friend made that point. I remind the Committee that Wales is entitled to at least two representatives on that committee. We should have a ballot of all Welsh district and county councillors so that we have representation from mid and north Wales and not just from the industrial south.
Above all, we should address the democratic deficit problem not just in Europe but in Wales, with a Welsh assembly acting as a focus for contact between the EC and local government. That would ensure that the needs of Wales, in terms of the opportunities offered by EC regional and structural funds, were taken up. That would give us programmes for economic development, investment in infrastructure and in education, training, health, housing and so on, which would genuinely ensure that Wales did not fall behind as a forgotten area of Europe.
While the Committee of the Regions is welcome as a regional voice in the EC, we should go much further. We should create a bicameral European Parliament with a second chamber consisting of members of national Parliaments and regional assemblies such as a Wales assembly. They should not be national government appointees so as to ensure that they represented their domestic electorates.
The second chamber should have consultative rights and be able to scrutinise legislation from the European Parliament and suggest amendments to it before it was finally agreed through the process of co-decision with the Council of Ministers. The advantage of such a second chamber would be to build in a checking mechanism of elected members from the nations and regions of Europe. That is probably more important for the regions, to help exert a countervailing force on the enormously powerful centralising tendencies of the EC. That argument is supported by the increasingly influential assembly of European regions, which represents over 200 regions throughout Europe, and not just in the EC.
Maastricht puts economics before politics, monetary union before democracy. It puts the cart before the horse and, in that context, areas such as Wales and other outlying regions will be forgotten and left far behind as the rush towards monetary union and centralised economic power remains the dominant force.

§ Mr. Cash
It is an interesting experience for me to speak following the thoughtful speech of the hon. Member for Neath (Mr. Hain), because, while he and I come to our politics from a completely different philosophy, much of what he said—on the central question of the direction in which the Community is going, the centralising tendencies, the undemocratic and authoritarian nature of the central banking arrangements, the impact that all of that has on the poor and the way in which the whole system is being constructed—struck a chord across the party divide.
For those reasons, the arrangements prescribed in the Maastricht treaty have been found wanting. That has become clear in our debates. Precisely because there is a convergence of view in all parts of the Committee, 555 mitigated only by the collusion between the two Front Benches, the truth is being revealed. I said in a recent book that the truth is available to all if only people would listen to what was being said.
Yet again, the Press Gallery is almost empty. I appreciate that the journalists need a meal, but I hope that at least some of them will read the speech of the hon. Member for Neath, in the knowledge that his views and those of many of my hon. Friends are of great importance to their constituents and the readership of the newspapers.
I commend an article by Dr. Jeremy Leaman in The Guardian, in which he pointed out the dangers. That newspaper is not noted for its enthusiasm for policies that might be promoted on the Government Benches. The Guardian has had the guts to state in its columns the truth about what is going on and the way in which a monolithic structure is being created, with cosmetic ploys such as the Committee of the Regions being thrown into the pot to divert attention from what is really happening.
On 1 July 1991, at a critical stage in the movement towards the signing of the Maastricht treaty, the Prime Minister said that he did not believe that it was a practical proposition to proceed immediately to monetary union throughout the Community. He want on:
Given the differing economic performances of the countries of the Community, monetary union would lead to massive regional unemployment, a massive collapse in asset values, a massive amount of unemployment generally, a massive population movement and huge demands for an increase in structural funds to deal with those problems. It is not a practical proposition until there have been various convergences." —[Official Report, 1 July 1991; Vol. 194, c. 32.] If ever a case was made for abandoning this dud product of a Maastricht treaty, that was it. The case could not have been put better. On every one of those tests, since 1 July 1991 every aspect has been brought not just to fruition but exacerbated by the policies that have been pursued in pursuance of the treaty. As a result of what happened at Edinburgh, for example, the situation has been made worse.
I will not go into all the details. We need consider only some of what has happened. On unemployment, there are projections of at least 25 million unemployed in Europe in the next few years, with increases in the United Kingdom and with massive reductions in asset values, and since 1 July 1991 they have been plummeting. On every criterion given by the Prime Minister, there is every reason to abandon what is proposed. That applies even to those who were well-intentioned in the first place and believed that Maastricht was a good idea. We should abandon the whole futile exercise, because it is diverting attention from the real problems of the United Kingdom and of the EC, which is beset in all directions with massive dislocation.
That applies, too, to eastern Europe, where terrible problems confront those trying to rebuild their democracies. In any event, they would not get the benefit of the cohesion funds, should they ever be introduced. We face terrible problems in Bosnia and Yugoslavia from the military and foreign affairs point of view.

§ Mr. Budgen
Perhaps my hon. Friend will say a kind word to the sad and unfortunate people of Denmark, whose currency is under attack, whose interest rates have had to be increased and who will be realising that they, too, are about to pay a yet higher price to achieve 556 convergence? They will be joining the French, who are also paying a high price to achieve convergence. The peoples of Europe have had visited on them a terrible deflationary plague which the united establishments of their countries have told them that they must bear, and they are beginning to suffer grievously.

§ Mr. Cash
My hon. Friend could not have put it better. As I said in an earlier intervention, the treaty represents a deliberate policy of creating unemployment, and must lead to massive cuts in public expenditure. Some may think that that is a good idea. I cannot believe that the people of Denmark are thinking that. Nor can the people of France, who are equally affected by what is going on in the markets, be looking forward to the prospect of their situation getting worse. None of that will be compensated for by the cohesion funds. They will not get the money promised to them, because it is not there. Nor is there even the will or ability to make the payments.
While we are considering the exchange rate mechanism and its impact on countries affected by the chain reaction that is occurring throughout the markets, let us not overlook the fact that we experienced dreadful deflationary results, which eventually led to our having to come out of the ERM.
The lessons to be learned from trying to engage in the kind of engineering that this cohesion fund proposal represents will not make a ha'p'orth of difference to the people of Europe who will be so badly affected by the mega changes being made and by the authorisation of undemocratic manipulation of funds throughout Europe and through the proposals contained in the central banking arrangements.
8.30 pm
That brings me to the European investment bank. I discovered to my considerable surprise from the international affairs and defence section of the Library that the bank has not been referred to in debates in either the House of Lords or the House of Commons over the past two years; nor has it found any recent press releases by United Kingdom Government Departments about the bank. Indeed, it went on to say that a search for some consideration of the bank by any Select Committee yielded a similar negative response. There was no information about the bank in the House of Lords, the House of Commons, Select Committees or, apparently, Government Departments.
I make reference to this because the European investment bank is not a tiddly little bank. Its equity base is approximately as that of Barclays or the Deutschebank. The Chancellor of the Exchequer is a governor of this bank, and the United Kingdom owns 19.15 per cent. of its capital—the same for Germany, France and Italy. Its outstanding loans to customers are £50 billion, and the United Kingdom is committed to subscribing not only its share of the equity, which is in its capital and accumulating reserves about £1.5 billion—no inconsiderable sum—but also £7.24 billion more capital by 1998.
That represents about £10 billion invested in this bank, so we may well be interested to know what has been going on and to what extent the Chancellor of the Exchequer, as a governor of this bank, has been watching what has been happening and what is likely to happen in the immediate future.

§ Sir Richard Body
Is my hon. Friend aware that, in the forecast for public sector borrowing requirement, there seems to be no allowance for that appalling figure? Is it to be added to our PSBR requirement, or is there to be some creative accounting whereby it will not be included? If it is to be included in the PSBR, it will have the most catastrophic effect on our fiscal policies, and that will cause a great deal of inflation.

§ Mr. Cash
As ever, my hon. Friend has an unerring way of hitting a very good target, because the question I wanted to put to the Minister of State was just that—whether this further £7.24 billion which is committed to the European investment bank by 1998 has been included in the Treasury's PSBR forecast. If so—I look at him because I hope that he will be able to answer this question —under what heading will it come? We are entitled to ask that question, and we are entitled to a proper answer.

§ Mr. Macdonald
The hon. Member's sense of shock at discovering that about the European investment bank rather goes against his concern previously about uplifting the more backward regions of the Community. Surely he should be delighted at the scale of investment undertaken by the European investment bank and by its commitment to its charter of contributing to development, integration and social cohesion of all the member states. Perhaps he can draw a parallel between the concept behind the bank and the plans put forward by the Labour party at the last election for a national investment bank which would carry out a similar task in the United Kingdom. Is not what he describes—

§ The Chairman of Ways and Means (Mr. Vlichael Morris)
Order. I understand that the hon. Gentleman hopes to catch my eye. I hope that he is not making a speech already.

§ Mr. Cash
The hon. Gentleman has shown why he, one who is taking such a proactive part in promoting the Maastricht treaty on his side of the Committee, is falling out so badly with so many colleagues in this argument. I have to say—

§ Mr. Budgen
Will my hon. Friend agree that this is a very good example of the tremendously exciting prospect for socialism which is to be found in the Mastricht treaty? This is a very good example of a state investment bank which is specifically set up to provide a quasi-political alternative to the harsh and disagreeable logic of the market. There is no doubt that those hon. Gentlemen in the Labour party who do not regard sovereignty as important and who have abandoned the working-class patriotism which many of us had so much admired in the Labour party were quite right in saying that this is an important socialist measure, which ought to give more control and more domination to socialist civil servants and middle-class interferers.

§ Mr. Cash
As ever, I am indebted to the intervention of my hon. Friend, because he too hits the target unerringly. Following what was said by the hon. Member for Western Isles (Mr. Macdonald), I should also like to know whether the Minister of State, who is sitting here but may not be listening, is aware that, as well as being the biggest single net contributor to the Community budget, we are also subsidising the industries of Italy, for example. That is a 558 country with a GDP per head greater than our own through the European investment bank. These are the realities.

§ Mr. Winnick
Is the hon. Member aware that, if the treaty was anything like a socialist programme, no one would be more enthusiastic about it than I? Will he accept that, like many socialists, we consider national sovereignty to be extremely important, and do not intend to retreat from that in any way, but the Bill and the treaty are also deeply deflationary and the articles which set out the limits on public spending and the rest would mean that, no matter what cosmetic covering is given to the regions and the rest, there will be far less money and far more pain and hardship, as well as continuing mass unemployment.

§ Mr. Cash
It is a remarkable state of affairs that there is across the Floor of the House a pattern of practical common sense that emerges to show that there is a genuine national and European interest in this. I would have thought that nobody would want to have massive unemployment or provisions that lead to difficulties for many people who are worse off. The tradition of the Conservative party has always been to try to strike the right balance between provision for the less well-off and the generation of wealth. What is contained in the treaty and the arrangements will produce exactly the opposite results of what is claimed for it.
The Maastricht treaty is like a hall of mirrors. Every time they put forward one version, one can guarantee that the distortion in the mirror will throw up the opposite response. It is based upon a whole tissue of deceit and lies, and will lead, unfortunately, to a serious dislocation of the Community which those like me, who genuinely want it to work effectively, will find will come to nothing.
How, for example, can it be that we are subsidising Italian industry through the European investment bank? It is very simple. The United Kingdom contributes 19 per cent. of the bank's capital, but Italy takes a staggering 40 per cent. of its intra-Community lending. That is how we are effectively subsidising Italian industry, and that must be borne in mind. I hope that the Minister is listening.

§ Mr. Budgen
My hon. Friend keeps talking about Italian industry, but is he satisfied that all the money is going there? Where is it actually going? Some unkind people say that the Italian attitude to public finance is slightly different from our own. Unkind people—especially those from the Court of Auditors—have suggested that, if all the trees that are collecting subsidy in Italy were really there, there would not be room for a single road, playing field or open space in the whole of Italy. I do not know whether any of that is true, but we keep hearing—

§ The Chairman
Order. The hon. Gentleman is making a speech, not an intervention. He has great experience of the House and approached this evening in a more measured way. I hope that the initial harmony that he produced at the beginning of the sitting will continue. He must not make a speech.

§ Mr. Cash
My hon. Friend's remarks are borne out by the Court of Auditors' strictures on the European investment bank. Although my hon. Friend was on a bit of a fishing expedition, he is completely right. Grave reasons for an inquiry into the way that the bank has been operating and allocating its priorities have arisen from the 559 Court of Auditors' reports. It is not merely that subsidy ends up in Italian industries, but it is well known that there is massive corruption in Italy, so we have every reason to be concerned that 40 per cent. of all that money goes into the Italian economy.
Perhaps the Minister, on behalf of the Chancellor of the Exchequer—who is a governor of the bank—would seek an explanation for its apparent favouritism towards Italy. Is that what we regard as being at the heart of Europe? It does not seem to make a great deal of sense. Can the Minister also tell us whether the further £7.24 billion capital committed by the United Kingdom has been included in the public sector borrowing requirement forecasts?
Why are a Conservative Government, who believe in privatisation, committing billions of pounds of desperately needed taxpayers' money to a public sector bank whose activities could be better carried out by an ordinary private sector bank?

§ Sir Richard Body
Does my hon. Friend not detect some absurdity? We are carrying out a long privatisation programme. One of the arguments that we advance to our constituents is that it will help to reduce Government borrowing, and that it is to our advantage and that of the taxpayer to sell off some assets. Is it not the case that all the money that we claw in from the privatisation of British Rail, the prisons, or anything else, will go straight out to the European investment bank? If my hon. Friend is right —I am sure he is—that money will be passed on to Italy.

§ Mr. Cash
Absolutely. As I said during the debates on trans-European networks and energy, I am deeply concerned about the way in which the moneys are being distributed throughout Europe. There is a direct inter-action between the subsidies paid, the structural funds, which have not been mentioned much today and are growing massively, the cohesion funds—to all intents and purposes they are the same thing—and the concept of a social wage, which is the other side of the equation. In addition, as I said in the debate on the Railways Bill money resolution, massive subsidies are going to French, German and other European railways.
I am not in favour of subsidies, but I am damned if we are going to be left high and dry when other countries are being subsidised to compete against us unfairly. That applies to the pit closures. Our miners are being driven out of work, while subsidies are pouring into the German coal industry. Our miners and our mines are being put at an impossible disadvantage—including Trentham colliery, which has 300 million tonnes of coal under my constituency. All that is being done in the name of benefiting the British people, through subscribing to and ratifying the treaty.
There is no point on the political spectrum where I can see any benefits to the United Kingdom from the treaty. The more one looks at it, the worse it becomes. The same applies to the treaty's omissions.
The cohesion and structural funds and the common agricultural policy must be seen as a whole. The day after the set-aside arrangements were announced as a great victory by our Minister of Agriculture, Fisheries and Food, the Court of Auditors said that it would be the 560 biggest fraudulent honey pot ever devised. That is not a sensible way to run a whelk stall, let alone the European Community, and it is certainly not the way to run the United Kingdom. That is why I object profoundly to the treaty—not on theological or constitutional grounds, although I freely admit that that is one way to describe what is happening.
I am concerned about the practical considerations and the fact that we are pouring money down the drain, that there is no accountability for the moneys and that the bank and the arrangements devised for it are benefiting other countries at our expense. No deal in the treaty is of any use to the British people. It is all being done in aid of the so-called "one country" that I saw advertised when I went to the Berlaymont before it got asbestosis.
If the Government believe that the investment bank is doing useful work on a Community footing—I have difficulty in understanding how that can be—will they sell off their investments in it and reinvest the proceeds in a bank of the sort that has been mentioned by Opposition Members, which they say would benefit British industry? If we are not getting the benefit and the money is all going to benefit the Italians and others, let us at least make arrangements to ensure that it comes to us. Then the British taxpayer would at least get some value for money and British industry would get the help that it so badly needs.
I am not in favour of any of those socialist banks, but at least I see the merit of the argument of focusing upon the interests of our constituents rather than people in other parts of the Community.

Several hon. Members
rose—

§ The Chairman
I call Sir Russell Johnston.

§ Mr. Cash
I was giving way.

§ The Chairman
Order. The hon. Gentleman had sat down.

§ Mr. Cash
No, I was giving way.

§ The Chairman
Order. The hon. Gentleman did not say, "I give way to the hon. Gentleman." I was listening attentively.

§ Mr. Cash
No, but I made this gesture.

§ The Chairman
The hon. Gentleman has been making that gesture most of the evening, and it has little relevance to the Chair. I am sorry, but the rules of the House are clear. The hon. Gentleman did not say, "I give way." He sat down, and I called Sir Russell Johnston.

§ Sir Richard Body
On a point of order, Mr. Morris. I often do not say, "I give way." Often I merely indicate.

§ The Chairman
Order. If the hon. Member for Stafford is genuinely saying that he did not give way, I accept that he may continue. However, he has been in the House for some years and he is using his notes copiously, so perhaps he is not totally concentrating on what he is saying. Therefore, I call Mr. William Cash, but I ask him to recognise that he sat down and that, frankly, I am being more than generous in allowing him to continue. I hope that he recognises that.

§ Mr. Cash
I am indeed most grateful to you, Mr. Morris.

§ Mr. Winnick
On a point of order, Mr. Morris. This is a genuine effort to seek understanding. Are you saying that we should know that in future, if we give way, we should use the words, "I give way to the hon. Member"?

§ The Chairman
That is the normal courtesy of the Committee. It is not a definitive rule that can be found in "Erskine May", but it is the normal courtesy from one colleague to another, and I hope that hon. Members will follow it.

§ Mr. Cash
I am deeply grateful to you, Mr. Morris. That was a misunderstanding.
I want to take up one more point with regard to the European investment bank. We are told that the President of the Board of Trade has great enthusiasm for this treaty. He is the Minister responsible for small and medium-sized enterprises, and his Department's deputy secretary is a director of the investment bank.
Will the Minister ascertain from his right hon. Friend and explain how it is that, just as we have something verging on the scandalous with regard to the Italian situation, as I have just described, in 1991 one of the wealthiest countries in the Community—France—accounted for 62 per cent. by the number of loans and 23 per cent. by value of the investment bank lending to small and medium-sized enterprises in the European Community? The corresponding figures for the United Kingdom—I hope that the Minister will not only listen to this but also tell me how this can be—were a mere 1 per cent. by number of loans and 3 per cent. by value.
You may now understand, Mr. Morris, why I was concerned to be able to continue with what I have to say, because there are a number of questions that need to be answered here, particularly having regard to the dire position of the British economy at the present time. Furthermore, we are contributing 19 per cent. of the investment bank's capital and are committed to contributing a further £7.24 billion to the European investment bank by 1998.

§ Mr. Marlow
rose—

§ Mr. Cash
If my hon. Friend wishes me to give way, I shall be only too delighted to do so.

§ Mr. Marlow
My hon. Friend is being a little harsh on the investment bank; he ought to be thankful for small mercies, by comparison with the cohesion funds, from which we will get absolutely nothing.

§ Mr. Cash
I agree with what my hon. Friend says about the cohesion funds, but I do not in any way agree that it is at all a satisfactory state of affairs in the light of the evidence that I have just presented to the Committee with regard to the investment bank.
The cohesion funds, of course, are essentially socialist in concept and character. I do not for one minute hold it against Opposition Members that, in a democratic country, they fight for what they believe in. However, I detect considerable enthusiasm on the other side of the Committee for a bit more of the socialism that brings benefits to the British people.
When so many of our regions have massive unemployment, which is increasing as a result of the policies with regard to such aberrations as the exchange 562 rate mechanism, hon. Gentlemen are beginning to ask themselves some questions about the good sense of their Front-Bench colleagues in subscribing to this treaty.

§ Mr. Knapman
Will the hon. Gentleman give way?

§ Mr. Cash
I will indeed.

§ Mr. Knapman
Is my hon. Friend aware that, in a few weeks, we may be asked to vote for some increase in taxes, and that, of course, we must willingly do if it is necessary? Does my hon. Friend agree that, if the public realise that all this extra money is to be spent in Sicily and Sardinia rather than in Stroud and Stafford, the British public may not have such a happy view of cohesion funds?

§ Mr. Cash
I certainly believe that the British taxpayer will become increasingly concerned about this. Not only is the central concept collapsing, but it is becoming highly dangerous to raise people's expectations and then have them dashed. While one hopes, quite reasonably, to help people in other countries, to be bound into a legal framework with the requirement to make these payments irrespective of the conditions in one's own industries does not seem to make much sense.
It is for these practical reasons that so many people in the country, and so many of our hon. Friends, agree with us, irrespective sometimes of their voting record, and tell us behind the scenes that they see a great deal in what we are saying. We reckon that a significant number of hon. Members on both sides of the House agree with us, in line with the general population.
The cohesion fund concept involves the transfer of these funds to other countries, primarily to enable their businesses to compete with ours. We are having a quite difficult enough time already with the amount of unemployment and the problems facing British companies, which employ the British work force, without making these massive contributions and effectively helping to set up, through the subsidies that are siphoned off and then paid through the back door to, for example, some of the Spanish regions and companies—competitive enterprises. We have the example of the steel casting industry, which is effectively closing down companies in the United Kingdom. What kind of lunacy is this?

§ Mr. Marlow
rose—

§ Mr. Cash
I give way to my hon. Friend.

§ Mr. Marlow
On the cohesion fund, I put a point to my right hon. Friend, and I know that he is thinking about it, and I hope that he will answer it later in the debate. Article 130b says most clearly:
Member States shall conduct their economic policies…to attain the objectives set out in Article 130a". Article 130a is a key article. It comes under the heading "Economic and social cohesion" and says that we should all
aim at reducing disparities between the levels of development of the various regions". Effectively, this means that we must block our more efficient industries so that we can spend money to make the industries of other countries more competitive with ours. If we do not do that, we will not reduce the disparities. So we are committing ourselves to redundancies and closures of factories so that factories can be opened in Sardinia and Corsica.

§ Mr. Cash
That is absolutely right. If this were just a parlour game—Monopoly, or something of that kind—I could understand that people would not take it too seriously. But I sincerely hope that the people of this country will be given full information about the sort of situation that is being generated by these arrangements.
The cohesion fund arrangements, which are quite clearly set out in the articles to which my hon. Friend has referred, are creating deliberate disparities, which are avoidable if we do not ratify the treaty. I look to the Minister with some astonishment, but nevertheless ask him the question, as I have asked question after question with regard to the whole of this treaty. Will he please give us some answers?
We are not inventing all this. These are facts and figures: this is evidence—what a Committee stage is all about. We are putting simple, moderate questions. We are not trying to be awkward or difficult. We are simply looking at the evidence and asking for answers. But we are getting absolutely nothing. Thus, the democratic nature of these proceedings is being undermined. If we do not receive answers to our questions, people will be left wondering, after the treaty has been ratified, how on earth, and for what reason, this was ever done in the first place.
One of the objectives of Committee proceedings—

§ The Chairman
Order. I am well aware of the objective of Committee proceedings. This amendment is specifically about cohesion—a subject that the hon. Gentleman left some minutes ago.

§ Mr. Cash
I was talking specifically about the impact on British business and about the significantly adverse effect that the cohesion funds will have on that business. Surely that matter is of interest not only to members of the Committee but also to people outside.

§ Mr. Hoon
Can the hon. Gentleman explain how the cohesion fund, which is limited to the fields of the environment and trans-European networks, will have an adverse effect on British business?

§ Mr. Cash
It is very simple. The arrangements for trans-European networks are based upon assumptions about the subsidies that are applicable in other countries but will not be so readily available here.

Mr. Horn
indicated dissent.

§ Mr. Cash
The hon. Gentleman shakes his head. I do not want to be taken too far down this road, as it was discussed in a previous debate. I need say only that the facts speak for themselves. In effect, we are being taken for a very substantial ride. That being the case, it is important that this part of the treaty should not be ratified.

§ Sir Russell Johnston
I am sure that I shall be forgiven if I do not follow the hon. Member for Stafford (Mr. Cash) with his various apocalyptic visions.
There is no doubt that this debate covers a central area of argument for those who, like me, believe very much in the Community, as well as those who distrust it and those who, like the hon. Member for Stafford, although he occasionally claims otherwise, oppose it. It is certainly untrue to say that the founding fathers were interested only in the wealth that could be generated by a large Common Market. They were all deeply wedded to the 564 political concept of distributivism—the need to intervene in the market to prevent wealth concentrations and to act positively to ensure that the people on the periphery of the Community would share in the wealth that greater economic activity and efficiency created at the centre.
From the very outset, no one had any illusions about the way in which the golden triangle—London to Paris to Frankfurt—would evolve. People recognise the need to create countervailing forces and the fact that these would have to operate through the institutions of the Community. Likewise, it was recognised that, where technical progress created difficulties in industrial concentrations, the whole Community shared responsibility to help overcome them and to ease the transition to something else. Like the hon. Member for Southampton, Test (Mr. Hill), I was in the European Parliament in the years leading up to the establishment of the regional fund in March 1975.
Coming as I do from the highlands of Scotland, where there is a continual struggle against the problems created by population sparsity, I remember the excitement that greeted this development. The Highlands and Islands Development Board—an idea set out in very far-seeing detail in the Keynesian Liberal yellow book of 1928—was set up by the Labour Government in 1965 and put the highlands in a new context within the United Kingdom. Now the logic was extended to Europe, and there was enormously positive and optimistic feeling abroad. I believe that the feeling was shared in the regions of England and Wales.
However, the positiveness did not, in the end, quite work out as was hoped. Many things happened in the regions that would not otherwise have happened—I refer in particular to infrastructure projects, but fund allocation was limited, and funds were carved up in advance. The United Kingdom dragged its feet. In a way, it was a classic paradox. Very often people say that Britain must take a lead in this and that Britain must take a lead in that, but the other Community countries gave us the lead on regional policy. The Commissioner responsible was British —indeed, Scottish. He is now the Lord Thomson of Monifieth, was at that time a Labour supporter, and now takes the Liberal Democrat Whip in another place. The regional committee of the European Parliament was chaired by Brits—first, by the Conservative Member, the hon. Member for Southampton, Test (Mr. Hill), who, when he spoke, modestly failed to mention that, and later by the Labour Member, the hon. Member for St. Helens, North (Mr. Evans). Both were active and vigorous. Speaking as an individual Liberal member of that committee, I found their approach both flexible and constructive. However, there were two forces at work at home which made things difficult—they still do to a degree, and still influence many hon. Members and appear in our debates.
The Labour approach has changed slightly—or more than slightly. Before 1979, there was enormous reluctance to be involved in any Community activity, certainly if there was a danger that it might lead to someone forming the conclusion that the Community was a good thing. Matching funds were sought, about which there was a great reluctance, and additionality was not applied. I wish to ask two or three questions of the Minister about additionality, as it is important.
At that time there was fierce resistance in the Labour party to direct contact between regions and Brussels as the 565 party was not yet in what might be called its devolutionary phase. Likewise, the Conservatives were embarking on their free market crusade and were extremely anti-devolutionary, not just with regard to Scotland and Wales, but local government generally. They were not keen on helping any policy that was state-directed or, worse still, came from Brussels bureaucrats. Secondly, they were adamantly opposed to a meaningful direct relationship being built up between regions and Brussels, and, not surprisingly, they resisted the additionality rule.
I cannot express the additionality problem more clearly or succinctly than by quoting from the report of the House of Lords Select Committee on the European Community on the structural funds. The report, published on 18 May 1988, stated:
Additionality was recognised"— by the Government—
as a difficult concept to enforce. This is the principle that projects or programmes receiving a grant from the Fund are to be given domestic government funding, in addition to—and not in substitution for—existing planned public expenditure. The United Kingdom Government apply additionality on a 'national' not 'local' basis. Although the Funds allocate money to the United Kingdom on the basis of schemes applying for aid, the money is given in a lump sum to the Government, and is not always passed on directly to the applicant. In the case of local government authority receipts from the ERDF, the local authority will receive the Fund grant directly but government departments will reduce the authority's approved capital borrowing programme by a corresponding amount. That still continues. The report continued: In the case of aid to industrial projects, supported by the ERDF, the DTI will retain the Fund grant and not pass it on because it will have already disbursed a grant to the firm in the expectation of receiving an ERDF grant to cover the expenditure. Projections of national public expenditure are increased—in anticipation of Fund receipts … Member States can estimate future receipts because the 'quota system'"— for a long time, we received 28 per cent.— where each Member State has been allocated … Thus grants are not directed specifically where they are most needed, but rather are seen by the Government as providing a supplement for the national budget in the fields eligible for Fund support. That clearly expresses the issue. The report continues: This means that, up till now, 'the vast majority' of United Kingdom schemes applying for ERDF aid would have been implemented anyway, regardless or whether or not they received a grant". There was an exception to which they referred and which related to the schemes in Belfast, under the urban renewal regulations, where the Commission and the European Parliament demanded more transparent additionality to ensure extra national support.

§ Dr. Norman A. Godman (Greenock and Port Glasgow)
That narrow, unhelpful interpretation of the concept of additionality is still damaging local communities. In my constituency, the Government's interpretation of additionality has harmed local projects such as the Nenaval programme which was set up to help those communities suffering because of decline in the traditional shipbuilding industry.

§ Sir Russell Johnston
I agree entirely with the hon. Gentleman. It is certainly our view that the way in which successive British Governments have dealt with the regional fund and the concept of additionality has been disgraceful and harmful to many desirable projects.
566 However, it appears that this is all about to change. I am told that the change is entirely due to the tough approach taken by Bruce Millan, formerly Secretary of State for Scotland in the Labour Government, who in April 1991 blocked the RECHAR funds of £100 million for the coal mining areas because he rightly felt that the United Kingdom was using its regional fund money not as additional money but as substitute expenditure. I am told that new guidelines are due by 1 April and I would be most grateful if the Minister could comment on this and perhaps even give us some foretaste of them.

§ Mr. Marlow
The hon. Gentleman and I do not have identical views on this and I am grateful to him for giving way. He was talking about substitution. It is true that we have additionality, but there are other aspects of substitution. Community countries can apply for regional funds and other funds from the Community. Obviously, they have to contribute some of their own money, but they can apply for a lot of projects and get large sums of Community money. They might have supported some of those projects anyhow with their own finances, so the money they receive releases within those Community countries funding which they can use on other aspects of policy, perhaps in building up their industrial strength, and that might be to the disadvantage of the hon. Gentleman's constituents. That is another aspect of substitution.

§ Sir Russell Johnston
There are other aspects, but I will not engage in a long argument with the hon. Gentleman about them. The object of regional fund money was to enable countries to do things that they were otherwise unable to do. In that regard the Government have treated it simply as substitute expenditure.

§ Mr. Salmond
It will not have escaped hon. Members' notice that we have just been joined by the Under-Secretary of State for Scotland. It strikes me as a good opportunity for the Minister to intervene in the hon. Gentleman's speech to clarify the Scottish Office's position on the number of Scottish representatives on the Committee of the Regions.

§ Sir Russell Johnston
The hon. Gentleman anticipates something I will refer to later. I am sure that if the Under-Secretary, who I certainly noticed with his magnificent Edwardian whiskers, wishes to intervene that is fine.
I would also be grateful if the Minister were able to give us some glimpse of the Government's thinking on how regional funding will be handled in future. There is a school of thought that there should be much more direct region-to-Commission contact and that the money should not be carved up nationally but should be dispensed by the Commission dealing directly with the regions according to criteria agreed by the European Parliament and the European Council, possibly even on a package basis with the regions being allocated a sum of money and allowed to decide themselves what to do with it. One could call that subsidiarity. The Government say that they favour that, and I should like some comment from the Minister.

§ Mr. Michael Spicer (Worcestershire, South)
I do not understand why we have to give large sums of our money to the Commission, or whoever is dispensing it in return 567 for the Commission giving us a little of it back for our regions. I cannot understand what the national interest is in that particular equation.

§ Sir Russell Johnston
Again, the hon. Gentleman is being impatient, and I do not blame him for that. What he says just precedes what I am about to say.
I want to look at the anti-Community argument, that this is not something that the Community should do at all and that it is nonsensical to pay money to the Community which it then decides, after passing it through various bureaucratic sieves, to give back to us. [Interruption.] I trust that the hon. Gentleman to whom I gave way will do me the courtesy of listening to me, since I did him the courtesy of giving way and am now answering his argument.
The Community regional policy can theoretically be an interference in a country's national regional policy, and I suppose that there are those who feel that no external agency should override national priorities. I understand this perfectly well. But is it an override? The money is additional, if it is treated additionally; it is intended to do what the individual state feels unable to undertake because of other pressures and priorities. Why, if the Government cannot help north Wales, Cornwall or the highlands, should they not benefit from our general wealth-creating Community membership to get the things that they want done? That seems a perfectly reasonable proposition.

§ Mr. Michael Spicer
I apologise to the hon. Gentleman for not listening to the first part of what he said, but I have been listening very carefully to what he has just said. My point is that if you want something called regional policy, why not give it to the regions direct? Why recycle it round the European institutions and get back less than you put in, since it is only the Germans and the British who are contributing in net terms anyway? And yet we get back less for our regions. Why not give it to them direct? Why put it through this recycling process by which we get back less than we put in?

§ Sir Russell Johnston
The problem was that the Government either did not want to give it, or did not give it or was unable to give it, one or the other. I would assert the whole thing much more positively. If we are to have a Community with a social purpose, we must all accept that we have responsibilities beyond our own borders.
That brings me to the cohesion fund because, like the hon. Member for Copeland (Dr. Cunningham), who opened the debate, we on this Bench are supportive of the cohesion fund and of the cohesion of the Community. Indeed, the proposals in the cohesion fund are more limited in many ways than one might have felt necessary, and they differ from the original propositions. Nevertheless what is proposed is useful and positive. One is providing assistance for environmental projects, and that benefits not only the region or country where it proceeds but Europe more widely. One is assisting trans-European transport links, something which benefits all of us and facilitates the flow of trade. But beyond that, the argument for regional aid within a state is the same more widely within the Community as a whole.

§ Mr. Marlow
The right hon. Gentleman is being courteous in giving way and we are all grateful to him. He said that we have responsibilities outside our own borders. Everyone would agree with that, and I know that many of my constituents care very deeply about some of the problems in the rest of the world and would wish us to be generous in our application of funds in that direction. But I think that they would rather spend their money in parts of East Africa or Ethiopia where there is starvation and real tragedy. What would the right hon. Gentleman say to them about our spending money in Greece and Ireland rather than in parts of the world which are really desperate and which really need our finances?

§ Sir Russell Johnston
I will certainly give way to the hon. Gentleman as long as he keeps on calling me a right hon. Gentleman. It is an incentive for me to do so.
The answer to the first part of his question is that the Community gives very generous development aid. In answer to the second, I doubt very much that he is able to interpret his constituents' views quite as specifically as he suggests. What he says is not really an argument against either the cohesion fund or regional policy.
Northern Ireland Members have made a number of references to the fact that the cohesion fund might in some way disadvantage them vis a vis the Republic of Ireland. Northern Ireland has certainly been a considerable recipient from the regional fund, although this, sadly, seems to have had very little impact on the ideological anti-Europeanism of the Unionists. It is not the purpose of the fund to disadvantage any region but to contribute to the correction of imbalances. I remind the Committee that money given to Greece, Ireland, Portugal and Spain—which have a per capita gross national product below 90 per cent. of the Community average—is conditional on the recipients having a programme leading to the fulfilment of the conditions of economic convergence set out in the treaty.
It is not only a question of helping particular countries to increase their economic well-being but of exercising a degree of control over the direction of their economies. That also ought to be borne in mind. Nevertheless, the Minister heard the allegations and I am sure that he will respond.

§ Mr. Denzil Davies (Llanelli)
The hon. Gentleman said that convergence would have to accord with the Maastricht treaty. In fact, as he knows, the protocol specifically mentions that part of the treaty concerned with excess deficits. Spain, Portugal, Ireland and Greece will have to reduce their public borrowing to 3 per cent.—or at least produce programmes designed to reduce it—to get the money. Is that not a crazy way of going about things? Those countries will be required to cut public expenditure on roads, for example, to obtain money from the Commission to build roads.

§ Sir Russell Johnston
The right hon. Gentleman is quite right. One purpose of article c is to amend excessive budget deficits, but there is no fixed time frame for the programme leading to the fulfilment of the conditions. The right hon. Gentleman is right in that respect.

§ Mr. James Cran (Beverley)
Will the hon. Gentleman give way?

§ Sir Russell Johnston
Well—

§ Mr. Cran
Will the right hon. Gentleman give way?

§ Sir Russell Johnston
I give way to this seducer.

§ Mr. Cran
How very kind. As I see the hon. Gentleman's argument, the purpose is to achieve convergence. Does he not agree that the classical tools of which he speaks have been used for the last 35 or 40 years within domestic economies to try to achieve convergence but have not succeeded? If one takes the United Kingdom's regional policy map for the 1930s and superimposes upon it today's map, or even that of five or 10 years ago, they are exactly the same. Classical mechanisms do not work.

§ Sir Russell Johnston
I dispute that, and would argue that the Highlands and Islands Development Board, for example—which was a regional development mechanism—enjoyed a great deal of success. It reduced the outflow of people from the area and increased its income to the extent that it rose above the leval at which the region could secure Community grant. Much of the regional policy followed during the last Labour Government was also successful.

§ Mr. Rogers
Is not the truth of the matter that classical mechanisms have helped substantially in Wales and Scotland, because they brought to a halt the deterioration of the situation that had been developing there? Without those mechanisms, regional disparities would have been far larger than they are today.

§ Sir Russell Johnston
I agree. Such policies are central to the Community's political success. We cannot build a Community in which the weaker areas are seen to be neglected—a generous approach must be taken towards them.
The only strong point in the arguments made by hon. Members who have intervened is that there is a need for general budgetary revision, to bring contributions more in line with the GDP of the country concerned. That should be the determining criterion, rather than the complicated mesh of measures that we have now. That would overcome the problem of requiring a country to give, by whatever means, to another country that may be richer.

§ Mr. Christopher Gill (Ludlow)
Does not the hon. Gentleman appreciate that one of the sad effects of regional policy in this country has been the moving of jobs from successful, prosperous areas like the west midlands to other parts of the country?

§ The Chairman
Order.

§ Mr. Gill
Regional policy has created no additional jobs and no additional wealth.

§ The Chairman
Order. The hon. Gentleman must not simply carry on when I call him to order; he must resume his seat. What he is saying is entirely out of order in relation to the subject of cohesion funds. I hope that the hon. Member for Inverness, Nairn and Lochaber (Sir R. Johnston) will not be tempted down the same route.

§ Sir Russell Johnston
I shall obey your ruling, Mr. Morris. I shall now deal with the Committee of the Regions—although my hon. Friend the Member for Argyll and Bute (Mrs. Michie) hopes to catch your eye later, so that she can speak on the matter, on which she has tabled an amendment.
570 The hon. Member for Copeland argued that nomination to the committee should be limited to elected members. I would agree with that if I knew that the election would be carried out by means of a fair election system. My hon. Friends and I tabled an amendment to the hon. Gentleman's amendment that made that point, but, sadly, it was not selected. Nevertheless, Mr. Morris, I am sure that a fleeting reference to it would be possible.
Earlier, there was an exchange between the two Front Benches about corruption. I believe that, in the main, corruption in councils has arisen from false majorities, and, sometimes, from tiny minority votes. I do not think that it would have arisen if the councils concerned had been elected according to a fair system, in which parties are represented in proportion to the size of the vote that they received.

§ Mr. Jon Owen Jones
Italy, for instance, has not had a large majority in power since the second world war. Why does it not have a marvellous reputation for honesty and a lack of corruption, if corruption tends to follow from large majorities?

§ Sir Russell Johnston
I would not go so far as to claim that a particular electoral system will immediately produce greater honesty. [HON. MEMBERS: "That is what you said."] I would not say that that was always the case. We are faced with a difficult problem—difficult, that is, if we want the outcome to be fair politically, and fair geographically. We are dealing with only 24 members. It will not be difficult if the aim is simply to appoint placemen, as has been suggested; but I take some comfort from what the Minister has said. He seems to be trying to find a way of matching the requirements.
Personally, I do not exclude the possibility that that may necessitate a mixed system of some kind. If, however, the Minister is thinking of a replay of the Economic and Social Council, I hope that the House will want no part of it: that is the real resting place for cronies, left and right. Let me point out to the hon. Member for Hamilton (Mr. Robertson) that, in this context, there are no Conservatives and no Socialists; there are only trade unionists and members of the CBI, who are, of course, totally non-political.
Let me now deal with the geographical question, in the context of the treaty. People always talk about numbers when it comes to the Committee of the Regions. Article 130a says: In particular, the Community shall aim at reducing disparities between the levels of development of the various regions and the backwardness of the least-favoured regions, including the rural areas. Article 130c states: The European Regional Development Fund is intended to help to redress the main regional imbalances in the Community through participation in the development and structural adjustment of regions whose development is lagging behind and in the conversion of declining industrial regions.
9.30 pm
That means that a simple allocation of seats in proportion to the population, which, incidentally, would give 20 to England, two to Scotland, one to Wales and one to Northern Ireland, would not accord with the reason for regional policy set out in the treaty. Therefore, to establish the committee on that basis would be a breach of the treaty.
571 Under such an arrangement, Greater London would have three seats and the rest of south-east of England would have four so that, taken together, they would have two more than Scotland, Wales and Northern Ireland put together. I should not have thought that that was sensible or had anything to do with regional development. It would also create a further problem about having a simple United Kingdom-based election, direct or indirect.

§ Dr. Godman
I am given to understand that Scotland is to have six representatives on the Committee of the Regions. Is it not the case that the European Commission consults the consultative council of regional and local authorities and that with the creation of the Committee of the Regions, the council of local authorities is to disappear? Surely it makes good sense for the Committee of the Regions to be made up of local authority representatives.

§ Sir Russell Johnston
As to whether Scotland is getting six, I know not, and I doubt very much whether the hon. Gentleman knows. I do not think that the Under-Secretary of State for Scotland, the hon. Member for Eastwood (Mr. Stewart), knows but I could be wrong.

§ Mrs. Ewing
Is it right, Allan?

§ Mr. Salmond
Ask him to intervene.

§ Sir Russell Johnston
The Minister is always welcome to intervene but he shows no signs of doing so.

§ Mr. George Robertson
I noted the absence of an intervention by the Minister when there was a cry from a sedentary position of "Is it right, Allan?", which I can only assume is the Minister's Christian name. That was a passive indication of dissent from which we in Scotland will all draw conclusions.

§ Mr. Salmond
rose—

§ Mr. Ray Whitney (Wycombe)
rose—

§ Sir Russell Johnston
One at a time.

§ The Chairman
Order. The hon. Gentleman must make a decision.

§ Sir Russell Johnston
I give way to the hon. Member for Wycombe (Mr. Whitney).

§ Mr. Whitney
As a mere Sassenach I enter with trepidation into a debate north of the border. As I understood the arithmetic that the hon. Gentleman offered to the House, if the calculations were done strictly arithmetically, London and the south east would end up with seven representatives and Scotland with two. The hon. Gentleman objects to that proposition. I can understand the basis of his objection, but how can he square it with his and his party's complete devotion to proportional representation?

§ Sir Russell Johnston
The hon. Gentleman cannot have been present for the beginning of my speech because I went over that, or perhaps I am getting short-sighted and did not see him. The figure was 20, not 17, for England. With respect, perhaps he could read Hansard tomorrow to save me stretching it out.

§ Mr. Salmond
One last time. I hope that the hon. Gentleman can seduce the Minister to intervene on this point because we have already been told by the Secretary 572 of State for Scotland—have we not?—that he is aiming high in terms of Scottish places on the Committee of the Regions. Denmark, a country of 5 million people, has nine places on the Committee of the Regions, so it would be useful to know from the Minister whether aiming high is the equivalent of Denmark's nine.

§ Sir Russell Johnston
If the hon. Member for Banff and Buchan (Mr. Salmond) wishes to seduce the Minister, all that I can say is chacun à son gout.
Then there is the political question. The Government's approach to elections to the European Parliament has certainly not so far produced any evidence that they support pluralism or fairness. The Committee of the Regions will be advisory. The European Parliament, for that matter, is mainly advisory, expressing political views on the broad policies of the Community. However, in the 1983 European election, the Government watched 20 per cent. of those who voted in that election voting for the Liberal Democrats and getting no representation at all. I do not really trust the Government on this matter, but it is important; it is about democracy, electoral justice, enabling people's views to be expressed, and accountability. I hope that, despite their record, the Government will listen.
To be acceptable, the outcome must take proper account of geography and politics. That is not easy. I accept that it is difficult to be specific about numbers. My hon. Friend the Member for Argyll and Bute has very strong, definite views on that matter, but in, political terms, a proportional system would produce a fair outcome.
I certainly envisage the future of Europe as a Europe of the regions in which the old natural communities of Scotland, Bavaria, Brittany and Catalonia reassert themselves.

§ Mr. Derek Enright (Hemsworth)
And Yorkshire.

§ Sir Russell Johnston
Possibly even Yorkshire. At the time of the commission on the constitution, many surveys found that in Yorkshire there was a greater feeling of regional identification than existed in Wales. That caught many people in Wales by surprise.
The Committee of the Regions is a limited step in this direction, but it is nevertheless a step in the right direction.

§ Mr. Michael Alison (Selby)
The hon. Member for Inverness, Nairn and Lochaber (Sir R. Johnston), in a typically warm-hearted and good-tempered speech, had the wit to move from the stormy waters of regional policy and the cohesion fund—without any spillage of oil, I am glad to say—to the Committee of the Regions. He even managed to bring in Yorkshire as his parting shot. No Brer Rabbit he—he has covered the whole spectrum.
With my hon. Friend the Member for Pudsey (Sir G. Shaw), a fellow Yorkshire Member, I want to pursue the theme that the hon. Gentleman lighted upon in the concluding part of his speech—the Committee of the Regions. I want to take issue with the hon. Member for Copeland (Dr. Cunningham) in arguing, in amendment No. 28, for a monopoly on the Committee of the Regions for elected local authority representatives.
The Committee of the Regions is not a Community institution. It is, by definition, only an advisory and consultative body. For that reason, as a consultative body, it is not necessarily the best institutional terrain for elected 573 representatives to canter over. Elected representatives are elected to execute policy, so a consultative body is almost against nature for elected local government representatives —particularly, as my hon. Friend the Member for Pudsey will agree, elected representatives from Yorkshire.

§ Mr. Enright
rose—

§ Mr. Alison
We now have a Yorkshire intervention, so I give way to the hon. Gentleman.

§ Mr. Enright
Is not the right hon. Gentleman therefore asking for a duplication of EcoSoc? The Committee of the Regions is meant to be a quite different body altogether.

§ Mr. Alison
The hon. Gentleman is confusing us by introducing meaningless acronyms.

§ Mr. Enright
I apologise to the hon. Gentleman. I thought that he would understand that it is the Economic and Social Council.

§ Mr. Alison
That made the intervention too long, so it would have been better not to mention it at all.
According to the draft treaty, the Committee of the Regions is appointed for a period of four years. That fits in awkwardly with the variations and permutations of the periods of tenure of office of many elected councillors, especially if they are appointed from county councils and district councils. After all, county council elections are often out of phase with district council elections.
We may find that a representative who is nominated to the Committee of the Regions from a county council will suddenly drop out for electoral reasons after a period of three years, which is entirely out of phase with the normal four-year life of the committee. If there is a by-election which affects one of the nominated members, that nominated member will serve on the committee for only one year because the three-yearly cycle elections will come one year after his election in the by-election. The permutations and complications—

§ Mr. Ieuan Wyn Jones
Will the right hon. Gentleman give way?

§ Mr. Alison
I shall give way in a moment.
The permutations and complications of fitting in district councillors and county councillors with out-ofphase elections, and with the possibility of by-elections—all district and county councillors must serve four years—makes it nonsensical. I am sure that the Minister will agree that having a fully local authority nominated Committee of the Regions would mean people popping up and down like figures in a Punch and Judy show, in one year, out in another, with absolutely no continuity in the four-year span.

§ Mr. Jones
I am following the right hon. Gentleman's argument carefully. Does he agree that there must be at least two crucial components for the selection of members to the Committee of the Regions? Does he accept the basic premise that the people nominated or selected for the committee, whether they are councillors or not, need some form of democratic legitimacy? Is it reasonable that the members should be chosen not by a Secretary of State in England, Scotland, Northern Ireland or Wales but by the people of the regions?

§ Mr. Alison
I wonder what the hon. Gentleman thinks about democratic legitimacy against the background of 574 the provision of the unanimity rule in so many aspects of the treaty. With local government nominated members elected by a local poll of 25 per cent., which is common in local government elections, 75 per cent. of the electorate need not bother to vote. The democratic argument about minority-elected local councillors falls down, especially when the treaty is at such pains to have not simply majority voting in certain areas but unanimous voting in many areas. The basis of poorly elected local authority representatives fails on the democratic test which is inherent in the sort of specifications that we make as normal voting patterns in the treaty.

§ Mr. Salmond
Will the right hon. Gentleman turn his mind to whether it could be described as purely democratic if the Secretary of State for Scotland, commanding 25 per cent. of the vote north of the border, had untrammelled power to appoint the Scottish representatives to the Committee of the Regions? Would that be a democratic test which passed in the right hon. Gentleman's opinion?

§ Mr. Alison
The hon. Gentleman raises a different issue, although in doing so he underlines my point. If he is objecting to the status, validity and authority of the Secretary of State for Scotland, he must similarly endorse the fact that local authority representatives—nominated exclusively and to a monopoly degree, which is the point of amendment No. 28, by a 25 per cent. turnout at a local government election—have exactly the same detriment, and for the same reason, as the hon. Gentleman's lack of faith in the Secretary of State for Scotland.

§ The Parliamentary Under-Secretary of State for Wales (Mr. Gwilym Jones)
My right hon. Friend is developing an interesting point. Perhaps he and other hon. Members will consider the difficulty in having a body composed entirely of elected councillors, when our estimate is that the kind of people we would like to see on this body, who would work at it and take it seriously [Interruption.] Perhaps I should have referred to the kind of people whom the Committee and hon. Members would like to see serving on the Committee of the Regions—people who would take their work seriously and make a contribution. Our best estimate is that it would involve about two days' work a week. I wonder whether a conscientious, locally elected councillor would be able to give that amount of time to the task.

§ Mr. Alison
My hon. Friend will appreciate that, because of my enthusiasm for the progress of the Bill and my admiration for his debating skills, I was in the Committee earlier in the day and heard him make a similar intervention. I have not made in my speech the point that he made only because he made it convincingly and succinctly in that earlier intervention. I remind him of that simply to rassure him that I am constantly behind him and supporting him. Even when he may not notice me, I notice him and listen enthusiastically to every pearl of wisdom that drops from his lips.
Locally elected councillors in, for example, councils which my hon. Friend and I know well in Yorkshire, work hard. Many of them find it a genuine struggle to carry the dual burden of earning a living and attending local council meetings to give their services as volunteers. My right hon. Friend is right to wonder whether they could be expected to spend as much as an additional two days a week. It was 575 enlightening to hear him point out that, in addition to all their other activities, they would be expected to spend two days a week on that work. Clearly, the supporters of the amendment have not thought through its implications.

§ Mr. Gunnell
Is the right hon. Gentleman aware that matters such as that are being considered by other countries and their representatives? How does he account for the fact that from France, Italy, Germany and Spain there will be regional representatives who will, of course, also be members of regional councils in those countries? They, too, will be occupying a dual role, which is common in continental Europe. Although he made an interesting intervention, the Parliamentary Under-Secretary shortchanged us—

§ The Chairman
Order. The hon. Member's intervention is becoming a speech.

§ Mr. Alison
I was glad to hear the hon. Gentleman's intervention. What I find heart warming is the sudden enthusiasm, which I believe is genuine, for the reality of democracy in some of our European neighbours. How recent it was that the Labour party wondered whether there was any real democracy in Germany, Spain or France, and how marvellous it is to find that all of a sudden we have France, Germany and Spain thrust upon us as models of the way the democratic system works. We rejoice in that new dawning of realisation on the Labour Benches, but I must tell Opposition Members that, despite their new-found enthusiasm for the realities of democracy among our European neighbours, there is still not quite the penetration of real down-to-earth representational democracy in France, Italy, Spain or Germany that we understand in our little local authorities, our district and county councils here at home.
The new-found enthusiasm for democracy which hon. Members locate in our European neighbours still does not make the case for their having a complete monopoly on the new Committee of the Regions or for us to have our own very much better representatives. [Interruption.] I want to get on, because I want to end on a positive note: that is to suggest that my right hon. Friend the Minister applies his formidable ingenuity to helping us in judging the kind of alternatives that there might be for finding nominated local authority members.
I am very disappointed that there is not an amendment on the Order Paper three or six pages long, listing all the different kinds of people who might be considered for nomination. [Interruption.] I shall not give way to my hon. Friend the Member for Northampton, North (Mr. Marlow). I have sat here for so long, I am so used to the dulcet tones of his voice, and I have heard it so frequently that I have almost reached the point of natural saturation. I shall therefore allow him to sit there smiling, with his teeth showing—the natural disposition of my hon. Friend —and allow my own voice to echo in my own ears for a little longer, denying myself the extraordinary privilege of yet a further intervention from my hon. Friend, of whom I am very fond, naturally, and in whose ordinary conversation in the Lobbies I rejoice in engaging.
I believe that my right hon. Friend the Minister should pick among the representatives who might be nominated. I do not exclude, as I notice that in an earlier intervention he did not, local authority elected members from 576 nomination, but we do not want them to have a monopoly, which is the point of amendment No. 28. What about representatives from some of the worthy and specialised voluntary organisations, from the churches, the trade associations, the Confederation of British Industry, the Trades Union Congress or the Institute of Directors? I hope that my right hon. Friend will take up the ball and run with it.

§ Mr. Hoon
I am sorry that the right hon. Gentleman did not give way. One question I would have liked to have asked him in his enthusiasm for the Minister's denunciation of local authority members was whether he felt that a conscientious—I think that was the word—Secretary of State for Wales or a conscientious Secretary of State for Scotland would have time to serve on the Committee of the Regions.

§ Mr. Garel-Jones
Let me try to make it clear to the hon. Member. I am not denouncing local authority representatives and I am not saying for one minute that there should not be local authority representation, but let me put forward another point which ought to be seriously considered. It is not an uncommon practice on the continent for what I suppose might be called senior political figures to be nominated for a committee, on the understanding that they will not take an active part, and for the alternate to do the active work. I doubt whether that is a route down which we would wish to go but it is not uncommon and these are the kinds of considerations on which I hope the Committee will give us their views. We genuinely want to listen to what the Committee has to say on this matter.

§ Mr. Hoon
I am grateful for that clarification, but it raises further questions. I shall avoid being tempted along that route at the moment except to say that if the argument against local authority representatives is that they might not have enough time to fulfil the two days a week that the right hon. Gentleman suggests might be required, that must apply equally to his colleagues on the Government Benches. One of them—the Secretary of State for Wales —has said that he would have liked the opportunity to be one of the representatives on the Committee of the Regions.

§ Mr. George Robertson
My hon. Friend's line of argument is interesting and valuable. Will he reflect, as should the Minister, on the fact that the debate is taking place a year and two months after the Maastricht treaty was agreed and the Minister agreed to the setting up of a Committee of the Regions? Tonight he told us what the Government are against, but in those 14 months they have not found a single idea that they favour.

§ Mr. Hoon
I am grateful for that observation. Earlier the Minister said that two member states had already reached the point of naming their representatives for the Committee of the Regions. I thought that it was odd for him to say that, when we have no idea of the basis on which selection will be made in the United Kingdom and we certainly have no idea of the names.

§ Mr. Garel-Jones
What does the hon. Gentleman propose?

§ Mr. Hoon
I shall try to make clear what I think would be appropriate as I develop my argument.
577 What I have found surprising about the debate on the Committee of the Regions is that some reservations have been expressed about what I would regard as a welcome development in the institutional relationship available to the European Community.
The Committee of the Regions will be the first formal institutional recognition by the European Community of the important role played by the regions and by local authorities. In recent months we have heard a great deal about the word subsidiarity, which has been used to describe the relationship between the European Community and national Governments. All too often the fact that it applies equally to the relationship between national and local government—and to the relationship between European, regional and local government—has been overlooked because the Government have so little regard for the important role played by local authorities.
Unlike any other Governments in the Community, this Government believe that power should be ever more centralised in the hands of the national Administration, in clear contrast to the overwhelming tendency throughout the Community to devolve power from the centre to the regions and to locally-based administrations. That is not done at the expense of democracy at the centre, but is in addition to it—a combination of democracy at local, regional, and national level, and I hope eventually at European level.
The Government's obsessive objection to local government has illustrated their attitude throughout the Maastricht treaty negotiations and the history of negotiations leading up to the conclusion of the treaty is significant in that respect. The original text of article 198a referred to regional and local authorities. The Government insisted on amending the word "authorities" to the word that is now found in the Maastricht treaty, "bodies". When asked why that change was made I believe that the Minister said that "authorities" had "too narrow a meaning". I understand that those were his words. It is clear what he meant by that explanation. The word "authorities" could refer only to the elected representatives of the people. The British Government's insistence that the word "authorities" should be written out of the original text has led to the present ambiguity.

§ Mr. Garel-Jones
I hope that I may be able to help the hon. Gentleman. He is right to say that the word "authority" appeared in the text, but the original text was in the French language and the word that appeared in the original French text was "collectivite". The decision was not taken by the British Government, or at their insistence, but by that admirable body, the jurist-linguists, who are needed in a Community where nine different languages are washing around. They decided that the word "collectivite" was best translated in the way that now appears on the face of the treaty.

§ Mr. Hoon
I am a little confused by that explanation, and I hope that the right hon. Gentleman will forgive me. I take it that he is indicating that it was not the British Government's insistence, but some other civil service objection to that translation. But certainly the original text referred to local authorities, and that appears to me to suggest that what was being sought in other member states was something that we would understand in this country by reference to an elected member—