BRITAIN AND THE COMMON MARKET

HL Deb 02 August 1962 vol 243 cc446-510

Debate resumed.

4.44 p.m.

LORD SHACKLETON

My Lords, I should first of all like to say how pleased I am, as I am sure are your Lordships, to see the noble Earl, Lord Avon, in such good form and in such good voice——

SEVERAL NOBLE LORDS

Hear, Hear!

LORD SHACKLETON

—although I will not join in the particular controversy between him and the noble Lord, Lord Boothby.

LORD BOOTHBY

It is an old one !

LORD SHACKLETON

It is an old one, indeed. The fact remains that we have now moved, in a quite extraordinary way, into an almost totally different national frame of mind, and I think that the most striking thing about the debate we have had in this House is that, with the exception of my noble Leader, and the noble Earl, Lord Attlee, there has been virtual unanimity. So much so that I had rather hoped in this debate that we were over the hump and could concentrate, as the noble Lord, Lord Grantchester, the noble Lord, Lord Merrivale and other noble Lords, have done, on discussing some of the detailed consequences of our entry into the European Community.

My Lords, my noble friend Lord Attlee raised once again some of the arguments which I feel we have debated at great length and upon which many of us, after a good deal of hesitation, have come to a definite conclusion. I, for one, was in the past most reluctant in regard to the idea of a European Community, or even a European union. Indeed, once (and I may have said this in the House before) I even refused to join the World Government movement on the ground that I thought it would be dangerous to be associated with a purely earth bloc. But one of the strengths of our present situation is that at least somebody has gone thoroughly deeply into the matter, and put in a tremendous amount of work studying the sort of institutions that would be necessary.

I would say, without any hesitation, as the noble Lord, Lord Gladwyn, said yesterday, that any approach to the Atlantic Community must have, as a first requisite, that Europe has, in fact, solved the main economic and, I would go so far as to say, political differences that divide us. As one who believes in the Atlantic Community, I regard this as an encouraging step; and furthermore, one that is clearly foreshown in the thinking and talking that has gone on. I do not believe for one moment that Europe is likely to develop an introverted approach at this moment: for there is a dynamic behind this which certainly is growing, a tremendous activity within the Community. But I believe that it will also be as outward-looking as the Foreign Secretary would like it to be.

There was one point on which I agreed with my noble friend Lord Attlee: I found the Foreign Secretary's historical analysis a little unsatisfactory. It has not, in my view, been true—and I think other noble Lords would agree—that it has always been the object of this country, the basis on which we achieved power in the world, to be at the centre of power. We have chosen to operate on the fringe. It seems to me to be the very essence of sea power, on which so much of our strength has been based, that you do not operate at the centre of power. But, my Lords, while allowing the Foreign Secretary a somewhat unsatisfactory analogy, I think that his main arguments, and his arguments with regard to the Commonwealth, were of a quite incontrovertible nature. I should have liked to say to my noble friend Lord Attlee that thinking has advanced to a rather more practical form than we knew in the past, when we thought about the Commonwealth as a rather abstract and exciting concept. The hard facts of our situation within the Commonwealth is that this country represents one-tenth of the developed population of the non-Communist world while the Commonwealth represents one-half of the underdeveloped part. The same thing applies in the field of income.

My Lords, it seems to me to be an incontrovertible argument, both in the interests of the Commonwealth, and, particularly, in the interests of those parts of the Commonwealth which are underdeveloped, and to which we all acknowledge an obligation, that we should strengthen our position, either by alliance or, if necessary, by going very much more closely into association, in order that that developed part, Europe, which is the centre of the development in which we should be associated, is able jointly to associate with us in the developments of the underdeveloped part of the Commonwealth. To use any arguments other than those hard ones would, to my mind, lead to our failing in a proper appreciation of what our responsibilities are to the Commonwealth.

One of the most dangerous aspects of our position in the world to-day, and one of the reasons we may not be able to play our part in the Commonwealth, is the permanent (as it seems to me) instability of our balance-of-payments situation. We debated this matter at some length earlier in the week, but we find ourselves in the position that our currency, which is the major reserve currency—more important than the dollar—to-day possesses an instability and lack of industrial base. This is a constant threat to the development of the underdeveloped part of the world, and we see within the Commonwealth the consequences of our own instability: the sudden imposition of restrictions; the stop-and-go policy for which we have criticised the Government so heavily.

This is not the time to go into the question (because we have already done so) of whether or not we should follow a more expansionist policy at the moment. I feel—and I am sure the noble Lord, Lord Boothby, would agree with me—that this is essential. But the fact is that we are still bedevilled by the insecurity of our balance-of-payments situation. If we go into Europe we shall not automatically solve that. Indeed, there will be a danger that whatever we do (there will be a danger if we do not go into Europe, as the noble Earl, Lord Longford, said) there may be a run on the pound. But if we go in we may also find that there is a flow of trade into this country which we may not be able to match as quickly as we should. But in the long run—and we must think of it in the long run—there is a chance, through the development of the banking institutions of Europe, of achieving a greater strengthening of sterling and, indeed, a greater strengthening of international currency operations. This, to me, is one of the major arguments in favour of our going into Europe. Anything that will solve these desperate problems of instability and balance of payments must be to the benefit not merely of this country but of our friends, relations and allies.

VISCOUNT ALEXANDER OF HILLS-BOROUGH

It is a gamble.

LORD SHACKLETON

My Lords, my noble friend may say that it is a gamble, but we have seen the consequences of gambling in the last few years, with the "Stop and go" policy. There is an absolute obligation, in this peaceful competition with the Communist world, that we develop our production. Far more important than anything in the short run, from our point of view and from the point of view of our Commonwealth obligations, is that our economy must get going, and this will give us the necessary stimulus.

LORD BOOTHBY

My Lords, if the noble Lord will allow me to say so, sometimes you win a gamble.

LORD SHACKLETON

I know that the noble Lord, Lord Boothby, had a happy experience at Le Touquet, although subsequent results were not so happy.

I should like to turn again to the industrial argument. My noble friend Lord Morrison of Lambeth spoke yesterday about the fact that large-scale industry, certainly, is already preparing for the European market. It is a certainty that if we are outside the European tariff barrier large-scale industry in this country will move into the Continent and will establish factories and have activities there. This is not going to create flexibility and opportunities for employment in our economy, and we know that there must be a fairly unpleasant period of reorganisation one way or another. We are confronted by declining industries. But it will be far better for the workers, for the business people and, indeed, for the whole people of our country, if we are able to get industry on a really large scale, and with the economies of scale that the opening of the European market will bring. These are my main arguments, and there are many more that have been deployed by others, in favour of our entering the Common Market.

There are one or two smaller points to which I should like to refer. I would mention some of the consequences which I think we must wake up to fairly soon, particularly in the social and what might be called the industrial field. We shall almost certainly find ourselves committed to a policy of equal pay, and a number of employers and, indeed, trade unions who have pronounced on this subject in the past must face this written into the Treaty of Rome. We must face labour mobility, but this is not as alarming as some trade unionists and others have thought. It will operate under conditions of reasonable control, and there are some very forward-looking provisions in the Treaty of Rome and elsewhere on the training and social help of migrant workers. For a country that has successfully, to its great credit, absorbed as many immigrants as we have from the West Indies, that we should worry about European immigration, when do fact one of the serious problems in most of the countries is shortage of labour, seems to me to be quite absurd.

Nor should we worry about the effect on our Welfare State. Indeed, in certain respects I look to an improvement. In some countries the benefits available are greater than they are in this country. Old age pensions in Germany are related to the cost of living, and on a very much larger scale, and that is something that I should like to see introduced into this country. Indeed, if we had seen a rather better Bill from the Government on this subject, we should not have been so far behind. This is a matter in which we have got to catch up. It is arguable that we shall find it very difficult to pay family allowances at the rate they do in France, and there is no suggestion anywhere—and the noble and learned Lord who sits on the Woolsack made this clear—that our own institutions, such as the Health Service, will be damaged.

I was interested that the noble and learned Lord answered the point of the noble Lord, Lord Cohen of Birkenhead. One of our difficulties is that there is a great deal of detail in the Treaty of Rome that will need to be examined at rather more leisure than is afforded in the appalling rush of these present negotiations. I can well understand that the Government have a pretty strict timetable. They want to get the legislation through before the next General Election. Speaking as a member of the Opposition, I can see advantages for the Opposition, also, in getting the legislation through before the next General Election. But I would urge the Government at this stage to redouble their efforts towards consultation within this country. One of the good things this debate has done in both Houses has been to bring forward many of the issues which were lurking in people's minds. It is surprising to me that the noble Lord, Lord Cohen of Birkenhead, and his friends, had not pressed their points more heavily on the Government earlier. But we are all waking up a bit late, and this time must not be wasted. Discussions of this kind should take place.

We shall be confronted—and I do not know when the draftsmen hope to get this done—with a considerable mass of legislation, if we are to harmonise our factory and other legislation, as in due course we shall have to do, and as we shall have to do rather more quickly than the old members of the Community, if we are to catch up with them. There will be a need for a great deal of legislation. There is one suggestion I should like to make now, on the assumption that we are going in. At the earliest date. I hope we shall be allowed to sand observers to the Assembly of the Community. It seems to me that this is a trade in which we are already experienced—this trade of assembly, and so on—but we shall have to become familiar, as those of us who have corns into this House or another place have all had to become familiar, with the peculiar nature of the problems and the way of conducting business. The sooner we are in a position to make a contribution, and to understand what is going on, the better. The great advantages will be that, when matters come before our respective Houses, we shall have among us people who have heard and sometimes taken part in the discussions. The advantage was very obvious When we were debating the assembly of the North Atlantic Conference and heard a number of noble Lords who had been there and who were able to interpret what actually took place.

I think the time has really gone by for generalisation. The time has come when we must do a great deal of hard work. The noble Earl, Lord Attlee, mentioned that we ware dealing in vague generalities; but, my Lords, a great deal of very specific information is becoming available. As the noble Lord, Lord Merrivale, said, firms must now start thinking, and must be helped to think, about the consequences of going into Europe. Large-scale industry—I.C.I. and the others—are well equipped to do this, but small-scale business is not.

My Lords, I should like to return to one argument that was advanced both by my noble Leader and by the noble Earl, Lord Attlee. Reference was made to a Europe stretching from the Atlantic to the Urals, and to the danger of going into an irridentist Europe. I rather regretted some of the remarks of my noble friend Lord Attlee with regard to the European countries, the slight gibes about them, which I do not think are helpful at the moment. But if the argument is that Europe is not safe and is not to be trusted, than how infinitely more important it is that we should be there to make our voice heard. I do not feel the anxieties that certain people have on this matter. It seems to me that either Europe is safe and we go in, or it is not safe and it is even more important that we should go in.

We are faced with the most remarkable developments in Europe. The idea that there could be a Franco-German entente of the kind that exists to-day is something which I think very few people would have believed possible. I believe we ought to go into Europe even more on political grounds than on economic grounds. I believe it is essential, for the reasons that I have given, that we should embark on this policy, this development of union, which we hope will lead to greater union. The Treaty of Rome and the complexities of it, and the fact that it has come into existence, is to my mind a tremendous cause for optimism. That it is possible for mankind to co-operate and solve these highly technical difficulties seems to me to show signs that we are capable of cooperating; that we are capable, in the end, of avoiding blowing ourselves off the face of the world. I would say that I personally approach the European Community now with enthusiasm. I hop that we shall look at this as an opportunity; something that we do not go into grudgingly, but something in which the political skills which we as a country have developed over so many years will find full scope.

Those of your Lordships who have taken part in conferences abroad will know that, on the whole, British Members of Parliament and Members of this House stand up pretty well alongside their Parliamentary colleagues from other countries. It is indeed one of the most striking things that I have noticed at these conferences. We shall be going into Europe with our accumulated skills We ought not to fear that we are going to be tricked by the Europeans: we ought to have enough confidence in our very long experience. Furthermore, we shall be going in with friends, friends who will come in with us—some of the Scandinavian countries and Ireland—and there will be friends there waiting for us. I hope that the Government's efforts will be crowned with the success that it is quite obvious the great majority of your Lordships' House wish them.

5.3 p.m.

LORD BALFOUR OF INCHRYE

My Lords, I am sure that all your Lordships must share the pleasure that I feel at having seen the noble Earl, Lord Attlee, once again in action, and would join with me in congratulating him on being restored to a state of health that allows him once again to take part in our debates with the vigour which he displayed this afternoon.

My Lords, I am conscious that the tide of debate has flowed strongly in one direction—and not particularly the direction in which I myself wish to go. But I would remind your Lordships that, though the tide of opinion may have flowed one way in your Lordships' House, there are many indications that the tide of public opinion outside is widely divided upon this particular issue. Most of the debate has taken place on the broad assumption that Her Majesty's Government are going to obtain the terms which they have said are essential for our entry. But in my remarks, I want to suggest that we should look rather more closely at what may be the alternative if such terms are not obtainable.

There is a balance of economic considerations that will decide whether we do or do not enter the Common Market Arguments can be advanced powerfully both ways. Yesterday the Foreign Secretary, quite naturally, weighted his arguments in the direction that he particularly wished to do. The Foreign Secretary said—and these are his words [OFFICIAL REPORT, Vol. 243 (No. 114) col. 272]: … if we do not go in, nothing will ever be the same … My Lords, that is true, but it seems to me that the question which we must ask ourselves is: how different will they be if we do not go in? How great will be the advantages, or how great will be the disadvantages for this country, either in or out? I therefore welcome this debate, in which I shall endeavour, if your Lordships will allow me (and your Lordships are always very sympathetic to the expression of minority views) to try to show that there is a viable alternative, and that we should, I think, prepare ourselves for considering such an alternative. Because, I repeat, it is by no means certain that what Her Majesty's Government have said are essential conditions are going to be obtained.

I would submit to your Lordships two propositions on this alternative course. First, I would refute the unjustifiable assertions that if we do not go in we face inevitable economic disaster; that if we do not go in we shall-be in a position of almost hopeless future stagnation; that we shall, as it were, wither on the bough. That is not so. I believe, and in a few moments I hope to show, that there is no justification for such gloom; that, indeed, the economic loss effects of not going in are well within this country's capacity to accept; that the alternative to going in is not disaster, and that possible losses through not going in can be compensated for in other directions by gains and by the possible avoidance of losses of trade which will be inevitable in some directions if we do enter the Common Market. My second proposition is that there is an alternative to E.E.C. membership which can give us a future of expansion free from those political ties and consequent dangers in a Europe which is certainly unstable politically in France, in Italy and in Western Germany.

My Lords, on the first proposition I think that the worst service which the enthusiasts for Britain's entry into the Common Market have done to their cause has been to build up this idea of economic ruin as an alternative to going in. Because facts do not support this contention. I take last year's broad pattern of trade. I know that the position has altered this year, but I like the broad pattern of trade for my purpose. Broadly speaking, 45 per cent, of our exports went to the Commonwealth and 25 per cent, to Europe, of which about 16 per cent, went to the Common Market countries. It is true that entry into the Common Market may increase the flow of trade between Europe and this country, but that will not necessary be to our balance-of-payments advantage. The noble Lord, Lord Shackleton, said that in the short term we may have to face difficulties, but that we must look far ahead. On the short term, we may suffer grave balance-of-payments difficulties. I quote to your Lordships a report on Britain's economic position which was made by France's Financial Counsellor in London, and which came out a comparatively few weeks ago. This is what he said: The dismantling of tariffs which will mark the U.K.'s entry into the Common Market will cause a brutal and massive increase of imports. The report went on to describe this as, a salutary shock for the United Kingdom which may finally make the devaluation of the pound inevitable. Next, I would ask your Lordships to remember that economists have pointed out that, by the removal of tariff barriers, the direct gains to the United Kingdom may be surprisingly small. I have here a quotation from Professor James Meade which came out in the Observer a few weeks ago. Professor James Meade calculated that if, as a result of our joining the Common Market, an extra 25 per cent. of our output was diverted from the home market to Europe in exchange for imports—and that is a truly gigantic figure of increase—the gain would be only about 2½ per cent. of our national income, or the equivalent of only one year's economic growth at our present limited rate of expansion. Against this gain must be offset the losses in direct Commonwealth trade and in our invisible exports—losses that will be inevitable if we lose a large part of our Commonwealth position as a price for entering the Common Market.

I suggest to your Lordships that the next question to be faced is: does our balance-of-payments position allow us to stay out of the Common Market? The advocates say, No. But I would again advise, if I may, a sense of proportion. Lot us assume that to pay our way this 40 per cent. of exports which Professor Meade spoke about goes to the Six. It is a gigantic rise we are assuming: about two and a half times the exports to the Six last year. But, my Lords, that represents little more than 6 per cent. of our national output. If we are outside the Common Market our goods will have to get over the hump of the Common Market tariffs, and prices will have to be reduced, probably, on an average, by about one-eighth—that is 12½ per cent. So, if one accepts that assumption, the total sacrifice of staying out will be no more than an eighth of 6 per cent., or substantially less than 1 per cent. I would thus maintain that economically on trade terms the dangers of being out have been grossly exaggerated.

I have said nothing at all of the political dangers, which I think are very real, of being minority members of a European organisation, with, as Lord Attlee remarked, an unstable France politically—no one knows what is going to happen when General de Gaulle goes —with a big Communist threat in Italy, and many dangers ahead in Western Germany. We should be, as it were, holders of a minority position in an Assembly governed by a majority of such nations as have that sort of Government.

LORD SHACKLETON

Would the noble Lord allow me to say this? He has twice referred to dangers and instabilities in Western Germany, and suggested that there is a political instability. What has he in mind?

LORD BALFOUR OF INCHRYE

I have in mind a very large growth, on the one hand, of an extreme Right wing Party and, on the other, the growth of the Communist Party on the Left. Nobody can call the position of Western Germany a stable one; nor can anyone look with much pleasure at the political prospects in France or Italy at the present time.

My second proposition is that there is an alternative to E.E.C. by which we can not only maintain our standard of living outside the Common Market but, I believe, provided that we make the necessary adjustments in home and overseas trade plans, susbtantially increase our rate of growth. The basis of an alternative policy rests upon the fact that the Commonwealth has a population of 600 million and that Europe has a population of 200 million. I know that the purchasing power per head is infinitely greater in Europe than it is in the Commonwealth, but one must look at two aspects of that. The first is: how much further expansion is there going to be in the Western European Market? Is it not a market which has been a booming market largely through the replacement of war shortages of capital goods and consumer goods, helped very much by American monies? If you look at the statistics to-day you will see the curve of demand is a flattening one in Western Europe, whereas the curve of demand in the Commonwealth is a constantly rising one.

If tariffs are put against Commonwealth goods—what I term the reverse preference—we are bound to lose our position. I personally deplore the conclusion of the agreement by the Lord Privy Seal on Commonwealth manufactures, because it means that after 1970 we shall be putting into action that reverse preference. Our Commonwealth trade is, globally, enormous. Industry by industry it is enormous; and examining it industry by industry one asks: can we afford to lose that trade? Let us take the motor car trade. 50,000 oars were exported to Europe last year; 300,000 to the Commonwealth. We cannot expect the Commonwealth to continue to give us preferences for our manufactured imports and our manufactured products if we ourselves are to put a reverse preference on their primary products.

Next, may I submit to your Lordships that our commerce is world-wide; that by tradition this country, unlike any other country in the world, equipped and manned for long-haul trade. In sterling trade, for every £1 we earn by selling goods overseas we are earning a further 8s. by the invisibles of transport, banking and insurance. Are we going to maintain that if we put a reverse preference on the Commonwealth and force the Commonwealth into a position of having to look elsewhere when hitherto they have looked to this country? Two-thirds of our trade with the Commonwealth is in British ships; two-thirds of our trade with Europe is in foreign ships. We risk these if we risk the Commonwealth position. Here, surely, my Lords, are foundations more solid than those in Europe on which to build a viable alternative to going into the Common Market. I should like to see the Prime Ministers' Conference in September have a different purpose than seems the likely one, of trying to persuade the Prime Ministers to accept the best terms Britain can obtain. I should like to see it change its direction from a defensive to an offensive: it should be a Conference proposing positive alternatives to Britain's entry into the Common Market.

My Lords, I believe that a call such as that would rally and inspire our people and give that response to leader-Ship which, if one reads the correspondence in the papers of the last few weeks, is obviously something which our ordinary folk are seeking. I like so much the words: At this crisis of history our Government should call together as a matter of high urgency a Conference of the British Commonwealth and Empire. With these, our kith and kin and our own people, we should prepare a plan of action to put before our friends in Europe". Those are fine words—words spoken in London in 1949. The speaker of those words? The present Prime Minister.

I would say this: that in any alternative the Commonwealth countries must do their share, in a much bigger way than they have during recent years, to meet the new situation which we shall have to face. I should hope that we shall consider at the Conference amending the "no new preference" rule of GATT SO that we could enter into long-term bilateral commodity agreements with our dependent territories and the Dominions. The White Paper of the Lord Privy Seal's Statement on October 10, 1961, shows something of the value of our trade with Commonwealth countries. He said: For example, among the dependent or newly independent countries, Mauritius sends 82 per cent. of her exports to the United Kingdom; Sierra Leone 70 per cent.; and Nigeria 51 per cent. Of the older Commonwealth countries, New Zealand is also heavily dependent on the United Kingdom market, sending 56 per cent. of her exports to us. The proportions of their exports which Australia, India and Ceylon send to the United Kingdom are of the order of 30 per cent. These are valuable outlets for the Dominions and dependent Territories. A proposition of bilateralism, not to a degree that would imperil the industrialisation of the Dominions but such as would give security for their primary products and miscellaneous preferential advantages for us, is surely something worth considering, as of course, is the proposition often put forward of a Commonwealth Central Investment Bank. If we do not obtain these terms—and it may well be that we shall not—if, as my noble friend Lord Avon said, we do not obtain the three major points, Her Majesty's Government have declared their inability to join the Six. It may well be that, if we do not get them, EFTA and the Commonwealth will have to enter into new relations first with each other, then with the United States and, finally, with the Six.

Where do we stand on the pledges of what is the unacceptable? The pledges have been repeated in general terms but I seem to see that, bit by bit, in detail they are being whittled away. There is the new feature, which has been slipped in, of the transitional period up to 1970. We never used to hear that the Commonwealth was to have a preferential position only until 1970, but now it is general talk in Governmental circles that they have what they call a transitional period until 1970, when the reverse preference would come into operation. The conditions that were unacceptable in October, 1961, seem to be acceptable conditions in 1962. Mr. Heath said It would be a tragedy if our entry into the Community forced other members of the Commonwealth to change their whole pattern of trade and consequently perhaps their political orientation. What has happened now? The very proposals for manufactured goods, apart from what are being negotiated now, embrace a complete change of trade for the Commonwealth. Mr. Heath said, as regards the manufacturers' agreement: They would be seriously affected, not only by loss of preferences in our market, but also if their position were transformed into one in which the whole of their export trade was affected by reverse preferences in favour of the major industrial countries in Europe. Nevertheless we recognise that indefinite and unlimited continuation of free entry over the whole of this field may not be regarded as compatible with the development of the common market and we are willing to discuss ways of reconciling these two conflicting considerations. That position has been surrendered by the manufacturing agreement.

That makes me worried as to whether there is a constant expression of the pledges in general terms, and a constant whittling down of the pledges in actual negotiation. Yesterday, the Foreign Secretary asked us not to use the expression, a "priority" as between the Commonwealth and Europe, but I think that the priority is there. It seems to me that the question is: do we follow a policy aimed at an increasing world trade based on maintaining an expanding Commonwealth trade and our EFTA partners, or shall we join a regional bloc behind tariff walls which, though we say we hope it will be an outward-looking organisation, shows every indication of being inward-looking and endeavouring to be self-contained. Which of these choices are we going to take? I believe that the final decision will have to be faced by Her Majesty's Government. I believe that the final decision may well be the terms demanded by the Six encroach too much into the pledges of Her Majesty's Government, and therefore we can no longer go forward in that direction. In that event, I hope that the few remarks I have made this afternoon may give some slight indication that there is a viable alternative if we are unable to negotiate entry.

5.26 p.m.

LORD PLOWDEN

My Lords, it is dear that negotiations in Brussels have reached a critical stage and no one should say anything that would make the task of our negotiators even more difficult, but as a supporter of the entry of this country into the Common Market I want to ask our Common Market friends not to be unreasonable, not to make things so difficult that we cannot join, because there is a point beyond which even the most ardent advocate of our entry would not wish to go. Obviously, it is impossible to give guarantees stretching many years ahead that would permit the sales of particular quantities of agricultural products to particular countries, but it should be possible to state clearly that the Common Market, enlarged to include this country, will so conduct its agricultural policy as to avoid serious damage to traditional suppliers, and that if, through miscalculation, such damage is caused to them, prompt action will be taken to put it right.

This means that Article 39 of the Treaty of Rome should not be so interpreted as to nullify Article 110—in other words, there should not be a price policy which allows the growth of cereal products in Europe, and this means in France—to a degree which would exclude not only Australian wheat but cereals from other additional suppliers, such as Canada, the United States and the Argentine. A policy which did this would so disrupt the pattern of world trade that it would have a most damaging effect, not only on the rest of the world but on the exporters of the Common Market itself. If the negotiations break down on this point, it will inevitably be interpreted in this country, in the Commonwealth and I think elsewhere, as being due to the selfishness of the Six, and of France in particular. The political effects might be very far-reaching, leading perhaps in this country to a strong desire to cut ourselves off from Europe, and possibly the wish to remove our troops from the Continent. Before a breakdown is allowed to happen, I hope that our friends in Europe will think carefully where it may lead us all.

I listened with great interest and attention to the speech of the noble Viscount, Lord Alexander of Hillsborough, and particularly to the early part that dealt with economic prospects, and it seemed to me that he dismissed this subject rather too easily. He said that he distrusted the judgment of economists and then went on to quote the economic judgment of Mr. Gaitskeill, referring to him as an economist, and to his economist friends, and said that in the view of these people, the economic effect of our entry would be "fifty-fifty". I am not an economist, but I have some contact with economists, and I think that the basic assumption made by all these economists whose views he quotes is that other things will remain equal—that is, that if we do not enter, changes to our advantage or to our disadvantage will not take place. This I believe to be the whole crux of the matter. The choice is not simply of joining or remaining as we are. The Common Market is here, and its existence is changing and will continue to change the world in which we live and trade. If we remain outside I suggest that quite radical changes will be necessary in our policies. In spite of the powerful speech by the noble Lord who has just spoken, I do not believe that the possibility of some close system of Commonwealth trade could come about in the present day, attractive as that may be. When such a suggestion was made in 1957 to Canadian Ministers their recoil was instantaneous, and I think that would be the case in all other countries.

It sometimes appears to be assumed by those in this country and in Commonwealth countries that we have obligations to the Commonwealth which must be fulfilled whatever the cost to ourselves. Before we accept this we must be sure that we are likely to be strong enough to fulfil these Obligations; and, with great deference to the noble Earl, Lord Attlee, it is not putting Europe before the Commonwealth; it is facing facts.

What are the needs of the Commonwealth? I suggest that they are capital; markets for their products; aid, both monetary and technical; defence—and all need this but some recognise it and some do not. For all or any of these things to be provided by the United Kingdom requires a strong economy. Can we expect this with our present policies and prospective patterns of trade? I suggest that it is most unlikely. Soon, as has already been said, if we do not join the Common Market we shall be the only great manufacturing unit who will not have a home market of something between 100 million and 200 million consumers, with all the opportunity which that gives for mass production and specialisation. It is, I think, extremely doubtful whether a market the size of the United Kingdom, even joined to that of the European Free Trade Area, is large enough to permit industries and firms to be big enough and specialised enough to compete in third markets with competitors based on these very large home markets. Efficiency alone is not enough. One must have the opportunity to exploit one's efficiency.

May I give an example from the manufacturing group with which I am associated? Amongst other things our group make over 80 per cent. of the bicycles made in this country, and of that total over 70 per cent. is exported. In 1951 this country exported nearly 300,000 bicycles to India. To-day in India companies associated with our group make over half-a-million bicycles and only token quantities are exported from the United Kingdom. Yet—and this is the point—we make a bicycle in Nottingham cheaper than we can make a comparable one in India. The same pattern is being reproduced in New Zealand, Africa and elsewhere. The recent duties imposed in Canada for balance-of-payments reasons will almost certainly prevent the export of bicycles from this country to Canada.

Of the total of over 70 per cent. that we export, over 35 per cent. go to the United States. Recently the Congress adopted a Bill, which substantially increased the already high duties to imported cycles with quite disastrous effects to our trade. We hope the Bill will not become law. Noble Lords will remember what recently happened in the case of carpets and glass. I think that this is not an untypical example and illustrates how an efficient industry can be prevented from exporting by clauses which have nothing to do with its own internal organisation and efficiency. A large market, and a market the size of which is not likely to be suddenly diminished for reasons entirely beyond our control, is really an essential part of economic efficiency.

It is now seventeen years since the war ended, yet our experience of recurring balance-of-payments problems remains. They are not caused by the laziness of the British working man or the inefficiency of the average management of British industry. I do not think we are either better or worse than other countries in this respect. They are, I suggest, a function of a maladjustment in our policy and a lack of appreciation of the change in our economic and political power. It is quite easy to understand. In 1945 we had just won a great war. I think it is true to say that on VE Day the British Empire had in contact with the enemy more divisions than, certainly as many as, the United States had. We still directly controlled the British Empire, people were tired and felt they deserved something; so they did. The country wanted a rising standard of living, a Welfare State, more leisure, more defence, the hydrogen bomb, a major say in the affairs of the world, maintenance of the Sterling Area, capital for Commonwealth countries, aid to underdeveloped countries, and so on.

All these things, desirable in themselves, were to come about at once and to come from the efforts and economy of a country as small and weakened by war as our own. For a few vital years our true economic position was hidden from the British people by a United States loan and Marshall Aid and gradually it seemed to many of us who should have known better that we could have had all we had before and more, too. My Lords, the fact is that for seventeen years we have been trying to do too much. Alone we can do some of these things, but not all of them. It is not to deprecate the great value of Commonwealth ties in this respect to say that the Commonwealth offers little help. It protects its industries; Imperial Preference is eroding away—it is less than half what it was before the War; it is a voracious consumer of capital; its defence effort is small. Canada, Australia and New Zealand, with higher standards of living than this country, devote, respectively, 4 per cent., 3 per cent., and 2 per cent. of their gross national product to defence compared to approximately 7 per cent. that we do.

Of course, we shall survive if we do not join the Common Market—no one sensibly supposes that we should not—but mere survival is not a very inspiring prospect and I submit that if we do not join sooner or later we should have to lighten the burden we have been trying to carry for seventeen years. How, and how soon, this will come about is of course impossible to tell, but I suggest that the main changes that would happen would be that we should reduce our defence programme, with less effort in Europe, the Middle and Far East; that ultimately we should not be able to bear the weight of sustaining the Sterling Area, and that it would break up, which, I think, inevitably would lead to bilateral trading arrangements and to an effort on the part of this country to be more self-sufficient; and I suspect that there would be a slowing down of growth, of the standard of living and of the policies of the Welfare State.

If we enter the Common Market, of itself it is obviously not going to solve our problems but it will give us the economic stimulus from competition that I think we need and it will give us the opportunity—and I do stress the word "opportunity"—of exploiting this large mass market which cannot be removed by political action. It will offer the chance of better co-operation in the use of currency reserves; greater specialisation in military matters, especially research and development; and cooperation Will give us better bargaining power in questions such as shipping; aid to Commonwealth countries would continue direct or through international agencies. My Lords, it should be remembered that at the present time France, Holland and Belgium devote a larger proportion of their gross national product to aiding underdeveloped countries than we do. To those who are fearful that our standard of living would be lowered by entering the Common Market, it is worth pointing out that the standard of living in Germany, France, Belgium and Denmark is already nearly as high as it is in this country and, at even the substantially lower rates of growth than have prevailed on the Continent in the last few years, will exceed ours within a decade unless our rate of growth is markedly increased.

I was particularly glad to hear the noble Lord, Lord Citrine, with all his experience, say yesterday that he felt that the prospect of full employment was greater if we were in the Common Market than if we were outside. To turn aside from Europe because the negotiations are difficult, or because the necessary adjustments would be hard to make, or because we do not want to get too close to foreigners would lose us the opportunity of helping to mould the new and vital things that are happening in Europe. But we could not escape from Europe. The history of the past 400 years from Philip of Spain to Hitler proves that.

Can we really contemplate with equanimity the growth in Western Europe of an enormous power bloc dominated by Western Germany, as undoubtedly it will be if we do not join? Western Germany is vitally interested in the unification of Germany for reasons that we can all understand and sympathise with, and it is not in any critical spirit that I suggest that she will be continually tempted by offers from Russia with promises of unification of Germany, which, if accepted, would lead to the break up of Western Europe and its unity. We could not escape from the consequences of any such developments by standing outside. But by not entering we should have forfeited nearly all possibility of influencing these events. Can we really believe that if we were members of the Common Market we would not add substantially to the strength and confidence of all the members, including Germany itself, and so be in a position to influence these developments in ways which I believe profoundly are in the best interests of its members and the Free World?

It is in Europe that the ideals in which we most believe were evolved: sanctity of the individual, the rule of law, democracy. This country, as much as, or even more than, any other took part in their evolution and certainly more than any other carried them round the world. Fundamental changes are beginning to happen in Europe both economically and politically. But our ultimate goal must be the even greater unity of the whole Western world. This country has a vital and essential part to play in all this, I believe a more important part than any we have played before, because without closer unity of the West we should hardly be able to stand against the Communist world.

None of this need be, or ought to be, a bar to close association, political and economic, with the Commonwealth. But to fulfil what the Commonwealth needs from us we must be economically strong, and I submit that to join the Common Market gives us the best chance of growing stronger. As the noble Earl the Foreign Secretary said yesterday, the Commonwealth needs us as much as we need them, and Europe needs us as much as we need Europe. For this reason I hope the Government will go on negotiating until they succeed in getting our entry into the Common Market.

LORD CITRINE

My Lords, I did not wish to interrupt the noble Lord in his very closely-knit and very logical address, but in reference to unemployment I made a very qualified statement, which I want to read. I said [OFFICIAL REPORT, Vol. 243 (No. 114), col. 336]: I cannot see, looking the problem in the face, that any single nation, however well disposed, can guarantee a permanent state of full employment, and I feel convinced that the prospects of ensuring full employment would be much greater if we joined with the members of the European Economic Community than if we remained outside. There is a very big difference between the two.

5.45 p.m.

THE EARL OF LUCAN

My Lords, I had not intended to take part in this debate, but the exceedingly one-sided way it has developed makes me think that there is a danger in a debate of this kind being publicised over the world; it might give the impression that opinion in this country is as nearly unanimous as it has been in your Lordships' House yesterday and to-day. That I believe would be an entirely false impression because what has struck me in the last few months is the steady hardening of public opinion against the idea of the Common Market. It has not been tested, except possibly by the opinion polls; it could be tested only by an appeal to the country on this particular subject. But I find people of all classes and different Parties expressing more and more a deep uneasiness at the way the Government are leading the country now.

My noble friend Lord Longford, who I know cannot be here until later this evening, quoted a document put out by a certain section of the Labour Party, and I think he meant your Lordships to draw the conclusion from it that that represented the main stream of opinion in the Labour Party. But that, I must say, is not borne out by the resolutions that have been sent in for Annual Conference. It is very notable that a block of 50 or 51 Amendments has been sent in for debate at the Conference and of those only one expresses unqualified approval of the idea of the Common Market. All the others, in varying degree up to unconditional opposition, are in greater or less degree opposed to the idea. I quote that not as conclusive but as a piece of evidence, a fairly weighty piece of evidence, that in one Party in the State at least opinion is crystallising against the idea of the Common Market.

I suggest that the reason for this uneasiness in the country is not because of the floods of paper with which we have been deluged from various sources, for and against, and the highly complicated arguments of the economists—because economists of varying kinds take opposite views. We are bemused with figures which the layman cannot understand without training, and the ordinary man has given it up. I think he has also heard conflicting views of the extent to which sovereignty or the supremacy of Parliament is going to be compromised by our adhering to the Treaty of Rome. I noticed that even the noble and learned Lord on the Woolsack was forced to say that in a number of respects it was not possible to say straight out whether or not this country would be restricted in its activities. So there again the layman does not know what to think.

So I believe there is general bewilderment, and people are falling back on the simple question: Why has all this suddenly blown up? What has happened to us, or what has happened to the rest of the world, in the last few years? Remember, in 1959 neither political Party mentioned it in their programme. Remember, too, that the European Economic Community had been set up two years before that. Indeed, about 1959, Her Majesty's Government signed the EFTA Treaty in order, not to go into the Common Market but to set up our own competing or, if you like, our own alternative grouping and structure of States. From my memory, practically nothing was heard about the Common Market until early 1961. Then, suddenly, we were confronted with the fact that a decision would have to be taken for which the country was not ready, for which nobody was ready, because we had not the information.

I believe that part of the feeling of uneasiness is due to the fact that people are wondering what can have been the factors that so radically changed the situation between 1959 and 1961. Remember, as my noble friend Lord Attlee said, this is a revolution in British foreign and economic policy. Ever since I can remember, ever since the First World War, our foreign policy has been based on the United Nations and the Commonwealth; and it is an entirely new conception that we should adhere to Continental Europe, much less to a small section of it. What has happened? Anyone who has read the speeches of members of the Opposition over a number of years will know that we think that the Party at present in power have allowed this country to stagnate. By their mistaken policies they have prevented this country from enjoying the economic growth that other countries in Europe have had. If it has really got to the stage where we dare not stay out of the Common Market, our economy must be a great deal worse than even Mr. Harold Wilson and others have been saying. If we are the "Sick Man" of Northern Europe, and cannot stand on our own with our connections with the rest of the world, it looks as if the situation is worse than the Government will admit.

There was one other factor which may or may not have something to do with the decision. I think that at the beginning of 1961 there was the Commonwealth Prime Ministers' Conference at Which there was something of a Commonwealth crisis, in which it became clear that the non-white countries of the Commonwealth exercised predominant influence in the Commonwealth, and, it will be remembered, on the initiative of some of the Asian and African countries in the Commonwealth it became necessary for South Africa to leave the Commonwealth. Possibly that was an eye-opener to the Government: an indication that the Commonwealth was no longer such a friendly little family affair as it had been.

Then, lastly, the new Administration came into power in the United States. And there have been more than hints, there have been statements in the papers, that it is the urgent wish of President Kennedy and his Administration that we should go into Europe, in order, as one understands it, to strengthen Western Europe and to build up Western Europe as a bastion against Communism. For that reason, of course, they are not at all anxious that the neutral nations of Europe, of EFTA —Austria, Sweden or Switzerland—should take part, because they regard the Common Market as at least as much a defence organisation as an economic one.

I am bound to say that I think your Lordships would be deceiving yourselves if you thought that opinion in the country was to any large extent coming round in favour of joining. The country is filled with uneasiness and distrust. We have heard a great deal about the merits of going into the Common Market. They seem to me to be taken very much for granted, without much argument. In fact, until the noble Lord, Lord Balfour of Inchrye, spoke, hardly anybody had questioned the assumption that to form part of a market of 240 million people was automatically an advantage to British industry. But I would remind your Lordships that not all of these 240 million people are consumers; there are some most active and able industrialists on the Continent, and we should be exposing our industries to that competition. It is not a one-way traffic. It may, in the long run, work out as an advantage; but, equally, it may be a most serious disadvantage in regard to industry and employment in this country. I think it was the noble Lord, Lord Plowden, who said that it would be an "economic stimulus" to us; and the Prime Minister not long ago talked about a "douche of cold water". That is all very well if you like cold water, and if you can stand it. But it would be wrong and misleading to assume that it is bound to be an advantage to have a home market of that size. Let us face it, my Lords: it would not be a home market, beoause it would be trying to get into another market already fully supplied by European industries. So I think that that point is open to considerable doubt.

There is no doubt that the whole structure of the Community is based on a philosophy of free enterprise and free competition, with only such planning as will suit the growing industries of Europe. I do not see anything in it that would be favourable to what my noble friend Lord Attlee said he believed in—namely, planning the economy for the benefit of the whole community. So I, for one, cannot believe that a Government, elected by the electors of this country to bring in a new economic policy and a social welfare policy that was different from that prevailing in Europe, would be free to carry out the policy on which it was elected. Whatever the legal implications of the Treaty of Rome, as the Lord Chancellor has indicated them to us, there have been instances already of countries who have entered the Common Market wishing to set up certain marketing organisations, and being ruled out of order because the organisations were contrary to the regulations, to the doctrine of whatever organ of the Community it may be—the Coal and Steel Community, or the others.

Then there is the question of the harmonisation of social and taxation policies. How certain are we that our present policies would comply with the requirements of the Community? What about our subsidies? Last week we subsidised the building of fishing boats and engines. We have subsidised fishing; we have subsidised agriculture, and a good many other things too. Our social services are financed quite differently from those on the Continent. Are they consistent with the rules by which we should be bound if we signed this Treaty?

Finally, my Lords, how is this structure governed? What is the constitution of this Community? It strikes all of us who have seen the general structure of the Community, even without studying it in detail, that it is not what we should call democratic. I do not believe that there is the Parliamentary control over the Executive, over the civil service, which we have come to regard as essential in our own system. So I do not think we can say that we are going into a democratic system. As my noble friend Lord Longford said last night, the Socialists in Europe all want us to come in. Well, there are not many of them; the proportion in each country is, I think, about 20 per cent. of the voters. It is rather like going bathing, and hearing your friends, when they get in the water, shout, "Come on in: it's lovely". But it does not mean it is going to suit you; or, for that matter, that it suits them. It is just that they want some companions in their misfortune. So I do not think I would trust the appeal from the European Social Democrats.

My Lords, the whole case hangs on the balance of advantage or disadvantage that would flow from our signing this Treaty. To my mind, the advantages have not been proved; they have not even been argued convincingly. Whether it would strengthen our position and enable us to assist the Commonwealth is again something which has been stated, but never really argued.

Finally, there is the bigger question, which my noble friend Lord Kennet touched upon yesterday: that to call this "going into Europe" is utterly misleading. It is not Europe. It is half-a-dozen countries. I think it was rather unfair of my noble friend Lord Shackleton to say that my noble friend Lord Attlee was gibing at the European countries. They were not gibes, my Lords; they are facts. Moreover, it is surely indisputable that three of those countries are not models of democratic Constitutions; nor are they, in our view, very stable. To go back to the economic argument, we are always told how prosperous people are in Europe. But are they? We see pictures of the Pirelli building at Milan, the glossy shops in the big centres; but we do not know about the poverty in the rural areas and in the poorer areas, the unemployment, and the rest. I do not think we have seen the whole picture when we are told simply that all the Common Market countries are going ahead.

LORD SHACKLETON

To which particular unemployment in Europe is the noble Earl referring?

THE EARL OF LUCAN

Southern Italy.

LORD SHACKLETON

Is there unemployment in any other country, besides Italy?

LORD MORRISON OF LAMBETH

Northern Ireland.

THE EARL OF LUCAN

I do not know what the unemployment situation is in Marseilles, or in the industrial areas of France or Belgium. Not long ago we were told that Belgium had heavy unemployment. I do not know whether that is still the case, but we are given these statements that the people in Europe are all prosperous because they are in the Common Market; and I, for one, should like further substantiation of those statements.

I go back to the main point. The Community is not Europe. This is a selection of European Powers who have come together, driven together, I think, by fear of Communism; and if we joined them we should be freezing that permanent division of Europe, instead of leaving it as fluid as possible, hoping that the cold war will thaw, hoping that the walls will go down in Berlin and elsewhere. We are just building more walls and are reinforcing the small, reactionary bloc of Western Europe in order to perpetuate this cold war, which is the poison that is preventing the world from seeing peace.

For all those reasons, my Lords, I do not like the idea of joining E.E.C. I see no reason for urgency. I do not see, as my noble friend has said, why the Government should press on with such appalling haste. It cannot put Mr. Heath in a very strong bargaining position when there is this tremendous haste to get something finished. I would suggest to Her Majesty's Government that they stand firm on the conditions they have put forward, protecting the Commonwealth. Let the Community go on and then, in due course, in some years' time, if they want us in we can go in whenever we want. If they do not want us in, we can get in now only at an undue cost.

6.7 p.m.

THE EARL OF GOSFORD

My Lords, I shall resist the strong temptation to reply to the noble Earl who has just spoken, because I am sure he will be dealt with much more effectively by my noble friend when he comes to reply for the Government. There is one point on which the noble Earl is slightly out of date. I think he just now mentioned Southern Italy. He was out of date to the extent that, whereas Northern Italy used to get its working population from Southern Italy because of unemployment there, that is now no longer the case; in fact, Northern Italy is finding itself in labour troubles through the inability to got labour from Southern Italy.

I do not propose to re-rehearse my views on the Common Market, because I gave them to your Lordships in the debate on the Common Market which we had last year. I should, however, like to say this. I consider this is one step in the evolution towards World Government, as has already been mentioned in this debate. Even if it does not happen now it will happen later, probably less advantageously to ourselves, and anybody who thinks otherwise is, I take the liberty of saying, something of a Canute in this respect. In my previous speech in the earlier debate on this subject I asked Her Majesty's Government that our negotiators should be people who have a knowledge of Continental life, and I am very glad indeed, as no doubt we all are, to see what an admirable team of negotiators we have there, with the Lord Privy Seal as the leader. Like many of your Lordships, I send him my good wishes for the negotiations.

That brings me to the speech of the noble Lord, Lord Robertson of Oak-ridge, which I enjoyed hearing, and which I read with equal enjoyment again this morning. He had seemed to be pessimistic about the insularity of the inhabitants of this island, and he mentioned in particular the Armed Services. I think that, up to a point, what he said is true but is natural to the type of existence which the Armed Forces live; although I think that airmen speak on a common level to airmen of any nationality because it is a common danger which they share. But to come back to the insularity of our own people, I am not pessimistic when one thinks of the hundreds and thousands of Britons from all parts of the country who now visit Europe. Admittedly, many of them take their own beer with them, and some of them demand English beer, or even fish and chips, when they get there. I believe that in Majorca they are now wrapping the fish and chips in English newspapers. But all this is to the good. After hundreds of years of being cooped up in this island they will come in contact with people of other countries who, without any water in between them, have lived side by side with, and have become used to, people of other countries. There will be a need for our people to be educated out of our insularity, if and when we go into the Common Market.

This brings me to a point which the noble Lord, Lord Citrine, mentioned yesterday, and which I think he reiterated when he intervened in a speech this afternoon. He said that, in his opinion, full employment would be more likely to be maintained by our going into the Common Market than by our staying out. That may be so—and I must say I agree with him—but my experience in industry is that the working man is confused about the position. That is the fault of nobody in particular, but I would urge, as the noble Lord, Lord Citrine, and the noble Lord, Lord Robertson of Oakridge, urged, that some sort of education should be got across to the working man as to exactly what the position is. If the views of the noble Lord, Lord Citrine, are correct, that the working man will benefit by our going into the Common Market, then he must be told so. Surely, it would be to the benefit of the Trades Union Congress if they told the working man. Because it is the Communist who at the moment is putting out propaganda on the shop floor, that the Common Market is all "hooey", that the working man will suffer, et cetera. Many of your Lordships have mentioned during the debate, that the only man to gain from this confusion is Khrushchev. That is certainly so, and the Communists on the shop floor are taking full advantage of it. I would ask most sincerely that either the T.U.C. or the Government consider some way by which our working man could be educated and told where in fact his advantage lies.

6.14 p.m.

LORD STRANG

My Lords, there is no subject which is more fateful for the future of this country, and of the Commonwealth, than the question of whether or not we are to enter the European Economic Community; and there is none which is more complex, and on which it is more difficult to reach a reasoned judgment. It is not possible to review all these proceedings in a few brief minutes. I can only try to convey shortly, and in a general way, the misgivings which this whole operation continues ta arouse in my mind. I want to introduce a note of scepticism, an element of doubt, into what has been at times a rather starry-eyed debate.

The primary argument for our entry has been economic. I remember very well the sober and persuasive speech in which, a year ago, the noble Lord, Lord Plowden, announced his conversion. That speech made a great impression on me. I was also deeply impressed by what he said a few minutes ago. He is a master of the reasoned and appealing speech. Then there was the speech of the Foreign Secretary yesterday, and that was another of those masterly expositions which the noble Earl never fails to present to us. I confess that it came some way towards converting me, but not far enough. So, my Lords, I still cannot bring myself altogether to share the rosy views of our prospects, which so many noble Lords have expressed, or to dismiss the Commonwealth as cavalierly as one or two of your Lordships have done.

As the arduous course of the negotiations, so valiantly conducted by the Lord Privy Seal and his devoted staff, has brought the real issues to light, doubts have begun to arise; and, as I think the noble Lord, Lord Balfour of Inchrye, has shown, there are at any rate some economists of repute who are now not at all sure where the balance of economic advantage will lie. Of course opinions can be found on the other side, but those which I am about to quote are views which it would not be safe to ignore, even though the noble Lord, Lord Plowden, has discounted them in advance. What have they said? For example, Sir Donald MacDougall thinks that none of the economic arguments for our going in is compelling. His view is: We can prosper and grow more rapidly than in the past whether or not we take this decisive step. It is even possible that entry might aggravate our economic difficulties. Mr. Colin Clark, who is in favour of our joining the Common Market, thinks that the economic advantages will be much less than is often claimed; and that the rapid growth of production and trade among the Six must be explained by factors other than their having joined the Community. Sir Roy Harrod, who tells us that he has not yet finally made up his mind, thinks that in contemplation of world trade as a whole and, in particular, trade with underdeveloped countries, the Treaty of Rome was a retrograde step.

THE EARL OF LONGFORD

My Lords, I am sorry to interrupt the noble Lord, but surely he would agree that Mr. Colin Clark is in favour of joining the Common Market.

LORD STRANG

My Lords, that is exactly what I said, I think.

SEVERAL NOBLE LORDS

You did.

LORD STRANG

And to drive that point home, Sir Roy Harrod adds this: We must eschew any act which injures the viability or progress of our overseas friends. At the same time we naturally have regard to our own self-interest and this lies in the same direction. If these cautious views should turn out to be well-founded, if the economic prospect is so uncertain, where are the advantages that are promised us? Where now is the argument that, by going into the Common Market, we shall strengthen ourselves and, by so doing, strengthen the Commonwealth; and what beneficial counterpart is left for the undoubted sacrifices which our entry would involve? Those sacrifices would be real. We should have put a heavy strain upon our economic and, maybe, our political relations with the other countries of the Commonwealth, particularly the countries of European settlement. We should have placed at risk a good part of our Commonwealth trade in both directions, which is still, in spite of everything, a very substantial part of our overseas trade—about 36 per cent. of the whole. There would, in the end, be Imperial Preference in reverse. We should take preferences away from the Commonwealth and give them to the Community. And let us note that about half of our own exports to the Commonwealth still enjoy preferences from 10 to 12 per cent.

My Lords, as we see the way these negotiations are going, we should be governed for years to come by the varying interpretations of a hard-fought and probably ambiguous diplomatic formula, by a sharply contested declaration of intent, and by the operation of a voting procedure as yet unsettled. In addition, we should have had to recast the organisation of our agricultural production in favour of a system the prime purpose of which seems to be the disposal of growing French surpluses.

Our food, too, would cost us more. How much more the Government, wisely, do not say. Economic analysts get out their slide-rules and calculate how many fractions of a penny this or that commodity will cost us more per head per week. But, my Lords, food traders, when fixing prices, do not use slide-rules. As for the argument that if we pay more as consumers, we shall, with the disappearance of the subsidy, pay that much less as taxpayers, Professor Parkinson has the answer to that. The money will not be saved, but will inevitably be used for something else. If that is so, justice would certainly require that it should be used for the alleviation of the hardships of those millions of humble people among us who are least able to look after themselves, and upon Whom the cost of food presses so heavily.

On the political side, too, there would be sacrifices. I like to quote, if I can, from those who favour our entry into the Common Market, rather than from those who oppose it. There is an excellent book called The Political Future of the European Community by Mr. Roy Price. Mr. Price is head of the London Office of the Joint Information Service of the European Communities. He is in the middle of the whole thing; he knows What he is talking about, and he writes carefully and honestly. This is what he says about the present set-up of the Community—that is to say, the Council of Ministers and the Commission, the bodies which we have now applied to join. He says: Under present arrangements the Community's affairs are in the hands of an irremovable and—in a certain sense—irresponsible executive; a state of affairs that would not be tolerated in any of the separate member countries. In explanation of this judgment, he says: The source of all major decisions in the Community is virtually outside the range of parliamentary control … If national parliaments insisted on a close control of their ministers' actions in the Council, it would soon become extremely difficult to reach any decisions at all … In any case, a national parliament has no say in the preliminary—and decisive—work of the Commission, nor in the subsequent stages by which the Commission's proposal becomes law. As more and more decisions are taken by a majority vote, even the semblance of influence disappears. Those, my Lords, are the conditions which we shall find in Brussels if we go in now, as the noble Earl, Lord Lucan, has rightly said. Of course, Mr. Price has the remedy for this—namely, the creation of a directly-elected Parliament with real legislative powers, and a single Executive for this "federally-orientated political group"; and he proceeds to adumbrate a scheme for this purpose. But we do not need to go into that. There is nothing here, my Lords, I think, that conflicts with the exposition, for which we are so deeply indebted, given by the noble and learned Lord who sits on the Woolsack.

In what I have said so far I have not said anything to disparage the European Economic Community as an institution designed to serve the special requirements of the Six highly-civilised States of Western Europe. It meets their particular needs in the post-war world. It is a signal manifestation of Western European resilience, self-confidence, political ingenuity and imagination; a unique structure erected upon the foundations established by Marshall Aid under the European Recovery Programme. Not only so; it has healed the wounds self-inflicted by Western Europe in the past, and, in particular, has sealed a reconciliation between France and Western Germany. But, as we know, the Six are not agreed as to what the future political shape of the Community should be. Within the Six there are two main theories about the future. An eminent Continental civil servant, now a member of the Commission, once said to me some years ago, in a moment of truth, Europe is an abstraction; the individual States are the reality "— and that is what President de Gaulle now maintains. There is", he says, no European reality other than our nations and the states which are their expression. To build Europe, there is no solution other than co-operation between nations". According to his view, there should not be a Community but a Union of States. That is one side.

The other view is that the aim should be to move gradually, step by step, towards a federal solution—that is to say, towards the creation of the United States of Europe. Monsieur Monnet's Action Committee for European Union, for example, has recently declared itself in this sense, with proposals which represent a departure from its original, more extreme, federalist ideas. This would not mean at this stage creating a central Government. Nevertheless, the objective, it is said, would be a partnership between a United Europe and the United States which would be a relationship of two separate but equally powerful entities, each bearing its share of common responsibility in the world". The Lord Privy Seal looked forward to this same objective in his statement to the Council of Western European Union on April 10, 1962, when he said—and I quote: This new Europe will be a great power"— note the words "great power", my Lords— standing not alone but as an equal partner"— again, note the words "equal partner"— in the Atlantic Alliance. President Kennedy, too, has recently spoken of the evolution of "a strong, closely-knit European entity "—the same word again—which would be an "equal partner"—again, an "equal partner "—with the United States.

My Lords, I believe that there is some illusion here. The point which I am about to make may seem to be somewhat esoteric, but I believe it is worth making. "Entity" and "great power" are brave words. If one thing is certain, it is that the European Community, whether enlarged by the accession of Great Britain or not, cannot become a "powerful entity" or a "great power" in any proper sense of the words, and certainly not a power equal in effective strength with the United States, on the basis of the Treaty of Rome or of any political instrument of the same or similar type such as that adumbrated by the Cattani Committee. President de Gaulle himself admitted as much in another connection at his Press conference of September 5, 1960. There were, he agreed, a number of more or less supranational bodies", and as long as nothing serious happens they function fairly well without too much trouble; but as soon as something dramatic happens and a serious problem has to be settled, it can be seen that no High Authority has political authority; it is only the states which have it. So much for the Six as an "entity" or as a "great power". In truth, the Western European Community can become a great power only if it has a truly federal Government; that is to say, a Government organised according to a system by which, as classically defined, the powers are divided so that the general and regional Governments are each, within a sphere, co-ordinate and independent. A great power properly so defined will have a central Government with certain defined powers in certain allotted spheres, and if it is a Parliamentary democracy its Government will be responsible to a central Parliament. It will have its own foreign policy conducted by one Foreign Minister through a single foreign service. It will have its own defence policy within its alliances, sustained by its own armed forces in concert with those of its allies. Even the old Austro-Hungarian Monarchy, imperfect as it was, had these things. The United States of America certainly has them, and so also should the United States of Europe. The evidence of history is that no mere confederate combination can be an effective unit in the rough and tumble of international life.

So, if we are ever to hope that Western Europe can become a great power in any true sense of the word, equal to the United States—-and this is what we say we want—it must became a Federation. Until it does, it cannot have a single, all-inclusive foreign policy or defence policy. Whether or not, even if the policy of France were to revert to that of M. Schuman, the Six could bring themselves, even step by step, to this result, I do not know. But of one thing I am sure: I cannot see Great Britain consenting, within a European Federation, while contributing to a central Government, to accept a status like that of the State of California, or tone Province of Ontario, or the State of New South Wales. That is what federal government means.

My Lords, that is all I have to say. There are many other points which I might have raised, but I will refrain. If I might put my conclusions in two sentences: first, there is, as I see it, an element of doubt about the advantage to us of our entering the Community; and if this is so, the price which we may be called upon to pay may be too heavy. Politically, the Community will not be fully effective as a vehicle of power comparable with the United States unless it becomes a Federation in the true sense of the word; and for us that is out of the question.

6.33 p.m.

LORD MCCORQUODALE OF NEWTON

My Lords, I am privileged to be the last Back Bench speaker in what I believe to have been a classic debate, comparable, in my opinion, to many of the great debates of the past held in this Chamber. Indeed, that is as it should be, for we have been considering affairs of the very first magnitude. I am sure all of us were delighted that in this debate two ex-Prime Minis-tens took part, both of whom we were delighted to see back in sufficient health to take a full and active part in the debate.

I hope that this debate will have done something, at any rate, to clear up the many misconceptions that there are in the country about the Community and the Common Market and the possibility of our entering it, for there is plenty of work still to be done by Her Majesty's Government and others to explain the facts to the people. There are very many nonsensical and mischievous stories being spread about by interested parties on what the Common Market may be. I have myself, for example, met on more than one occasion quite reasonable people who were firmly convinced that the loss of sovereignty that they read about so much in the Daily Express means that we shall have to dispense with our Sovereign and become a Republic. That has been quite a common misconception in certain quarters. I was delighted to hear Lord McNair yesterday say that he deprecated the use of (this rather stupid word "sovereignty". He suggested the word "independence" should be used in its place; and I fully agree with him. I hope everything possible will be done to clear up such misconceptions.

If I may, I should like to say just one or two words about my own reactions to this debate. It seemed to me that the results of the debate have been very much in line with the last few words which were used by Lord Morrison of Lambeth when he finished his very remarkable speech yesterday, which I thought impressed the House a very great deal. His last words were (col. 312): But that does not prevent my feeling that, if it be practicable, in principle it is right that the British should go into the Common Market. And I believe that the general consensus of opinion in this House at the end of the debate is just that.

I was enormously impressed, if I may say so, with the speech of Lord Robertson of Oakridge, and especially with the way he summed up what I believe is the root of the matter. He said (col. 367): … there remains one plain, cold fact, and that is that if we do not join the Common Market, the Economic Community, the Community will go ahead without us; it will succeed without us; and it will grow in exclusiveness, to our detriment, because our voice will not be heard in its councils"; and I believe that that is very true.

I mentioned the speech we had from the noble Earl, Lord Attlee. I was rather sorry that he appeared to deprecate the work of the international civil servant during his speech. He seemed to imply that to be an international civil servant was to be a rather lower class of individual than a national civil servant. All I can say is that if anybody has met M. Jean Monnet or M. Robert Sahuman and thinks that either of them is inferior to any civil servant in the whole world, he is very much mistaken.

I should like to say a word or two, if I might, about the industrial and the political effects of joining the Common Market in so far as they would appeal to me, having spent nearly all my life in industry. I would say to Lord Strang, apologising to him for not replying to his speech, that I felt it was something of an elaboration of what Lord Attlee said, and what Lord Attlee said seemed to me to be in essence: "This is a new thing. We have never done it before. I do not like it."

It has always seemed to me to be of the greatest importance to the peace of the world that Europe, and Western Europe in particular, should be in balance, with no one nation able to exert domination over the rest. Indeed, this has been our classic foreign policy down the ages and for which we have fought two wars in our own lifetime. Fortunately, to-day, the mood of Western Europe is greatly different; it is towards friendship and collaboration—"interdependence" is the phrase now used—rather than the rivalry that existed for so long. But I think that we must recognise that this happy state of affairs is, at any rate to a very considerable extent, caused by the magnitude of the threat hanging over the world from the East. But surely if Britain stays out of this Community, so much the less is this balance likely to be permanent and stable. If we are in and play our full part, then it is unlikely, to say the least of it, that any one of the nations in the group will dominate the others. The balance of power in Europe will be strengthened and the urge to ever closer collaboration will itself be fortified.

I have always believed that we missed a vital chance in not joining the Iron and Steel Community when it was first set (up, but I do not wish to go into that at this late hour, though I believe that that, even more than what my noble friend Lord Boothby was quoting, was our great mistake in the post-war world. I hope and trust that we shall not miss this opportunity, because I believe that the results if we do not join the Community will be increasingly serious for ourselves, and even more serious for the whole permanent stability and balance in Western Europe and, therefore, for the peace of the world.

When we come to the industrial sphere, I am one of those who think that it is in the highest degree desirable from the industrial point of view, from the manu-facturing angle and from the employment angle, that we should join the Common Market. I am in close touch with employers' organisations throughout the country, and I believe it is a general view of industry, both large and medium-sized, that great advantage lies to us in joining the Community. Our great firms must be in the Market; of that there is no doubt whatever. And if Britain does not join, it means that they will join without Britain, by building their factories overseas in the Common Market, as some of them are doing at present. And, as I know full well, many others have great plans for doing so. This means that the employment, which otherwise would come to Britain, and all the overheads, which would otherwise be earned by Britain, will go overseas.

The United States is concerned with this tremendous surge of industry wishing to get into the Common Market. Many American firms have set up already in this country, expecting that we shall become a member of the Community and that they will be able to co-operate in the Community from here. But this mood is changing and more of them are setting up on the Continent because there is some doubt of our attitude. Let me ask your Lordships to consider the question quite objectively, as if, for example, you were in charge of the great Ford empire throughout the world. I hasten to say that I have no connection Whatever with the Ford empire, not even with driving one of their cars. Ford have great factories in Britain, at Dagenham and elsewhere, and great factories in Germany. The market in Britain is some 50 million and the market in the Community is already 180 million. Which factories are likely to be extended, if Britain does not join the Community? I think it will be obvious to noble Lords where Ford's first interest lies in selling their motor cars. I take Ford only as an illustration of what must be obvious to all those conducting great world-wide enterprises. This would have a sharp effect on our employment in this country.

I am sorry to say that there is a tendency in certain quarters, and not least in certain political quarters, to decry British industry, both management and employees. I believe that this is unnecessarily pessimistic. I believe that British industry is healthy and well able to stand up for itself. I know that even before the politicians got active, British industry had been actively studying the markets in Europe, its prospects if we do join the Community and its prospects if we do not. Practically every individual industry in this country has sent its team to Europe and studied the markets, the wage rates and fringe benefits, all the markets in which we shall be in competition or where we can find outlets. I believe that, by and large, Briish industry is ready for a step forward should we now take it.

At this stage I should like very much to welcome the speech which the noble Lord, Lord Citrine, made yesterday. I believe that it was of immense value. His experience of trade union affairs is of longer standing and more importance than that of any other living man in this country, and I hope that many trade union leaders will take parts of his speech and print them in their trade union journals, because I believe that that would do an immense amount to clear away misapprehensions.

I would claim that it is the overwhelming view of industry that we must be able to compete in this new huge mass market if we are to maintain, still more to increase, our prosperity here in this overcrowded little Island. I have little fear that we shall not be able to compete, with reasonable success, with our fellows on the Continent, in industrial affairs, in manufacture, in commerce and, indeed, in agriculture. As a nation which has a longer inherited series of skills than any other, it will be our own fault if we cannot compete. There will need to be very considerable adjustments, of course. Many people seem to be frightened of adjustments, but in industry we are making them every day to meet the changing needs of the markets. It is those firms and countries who refuse to make adjustments who go to the wall.

One adjustment which will have to be made and which is causing a good deal of heart-searching is that written into the Treaty of Rome, of equal pay for work of equal value. That has caused a great deal of heart-searching in Germany, Holland, Belgium and Italy. A number of amusing stories are going about of how they are getting round it. But there it is, and we shall be able to deal with it quite satisfactorily in industry when it comes along. We must be able to trade with this huge market on equal terms. I could not quite follow my noble Mend Lord Balfour of Inchrye in his arithmetical calculations by which a 12 per cent. tariff seemed to be reduced to ½ per cent., but no doubt I shall be able to follow it better when I read it.

I believe that we must be in. And for another reason. I am hopeful and indeed confident that, if we become members of the Community, the City of London will become the financial capital of the Community. There is no money market in the world, no experience of banking and insurance, so great as one finds in the City of London, and this should be an enormous gain to our influence and prestige as well as to the important point which the noble Lord, Lord Shackleton, emphasised: that of stability in our balance of payments.

There remains the Commonwealth, which seems to be a bugbear to a certain number of people. I must say that to me the overriding argument is that if the prosperity of Britain declines drastically, so also will the prosperity of the Commonwealth, especially that of what one might call the old, or white, Commonwealth. If, on the other hand, Britain prospers, and prospers more greatly, then I believe that the Commonwealth will prosper also. For they count on us not only as a market but also—and this is equally important—for capital. If they cannot count on us, the economic ties of the Commonwealth to us are bound to be loosened, because they will have to go elsewhere to look for their capital and therefore become tied up elsewhere.

By all means let us strive our utmost so that we obtain reasonable terms for associating the Commonwealth with the Community. I must say that I trust the Government and the Lord Privy Seal to strive to the best of their ability. And I believe the Commonwealth in the end will see, to use a homely phrase, on which side of this affair their bread is really buttoned, I hope, therefore, my Lords, to see the negotiations successful and Britain playing her full part, both politically and economically, in the future of Europe. I believe that for those of us in industry there lies open a great fresh field in enterprise, endeavour and skill, if we take our full share in this new venture.

EARL HOWE

My Lords, I do not want to make a speech but I want to ask a question. What is going to happen to British shipping if we go into the Common Market?

6.51 p.m.

LORD SILKIN

My Lords, I will not answer the noble Earl; he has not put his question to me. I should like to begin by associating myself completely with the opening remarks of the noble Lord, Lord McCorquodale of Newton, when he paid a tribute to the quality of the debate that we have had in this House over the past two days. I must say that I do not remember a better debate, of higher standing and with more eminent participants than we have had on this subject of the Common Market yesterday and to-day. It has been well worthy of the vitally important subject that we have been discussing.

The Foreign Secretary, in a speech with which I agreed 97 per cent., opened by reminding us that about a year ago we had committed ourselves to instructing the Government to negotiate with the European Community, subject to certain conditions; and I took that to mean that both Houses had really committed themselves to the principle of the Common Market, subject to our being able to obtain the conditions that we sought. Nevertheless, I would not complain that we are to-day having a further debate and that this debate is ranging over the whole question of principle once more. It is right, after a year's negotiations, especially in the light of the critical position which we appear to have arrived at in these negotiations, that both Houses should wish to have an opportunity of reviewing the situation before we part for nearly three months, because in that period there seems to be no doubt that the negotiations may break down completely or we may arrive at some kind of agreement.

I should like to say in passing that I completely agree with the noble Lord, Lord Boothby; and I think the noble Earl, Lord Avon, too, made the same point, that we should not rush this. I do not wish to be personal, but I am quite sure that the Lord Privy Seal must be a very tired man; and I do not think that tired men are the best negotiators. You cannot negotiate effectively by staying up half the night negotiating. I would much rather that we took this thing rather more leisurely, that we allowed the Lord Privy Seal to take a rest and that we even put off the Commonwealth Prime Ministers' discussions than tried to arrive at a hasty decision which we might regret. Nevertheless, it is right that we should have been discussing this matter yesterday and to-day, and I understand that a pledge has been given that, if it should be necessary, Parliament will be summoned before the appointed time.

Unfortunately, in discussing this question and in reviewing the situation the House is in possession of very few additional facts as compared with a year ago. We do not reality know what is the attitude of the various members of the Community to the problems which face this country in connection with our application to join them. I think it was the noble Lord, Lord Boothby, who made a guess at what were the views of the different Heads of Governments. He may be right or he may be wrong.

LORD BOOTHBY

Probably wrong.

LORD SILKIN

We know for instance that the Prime Minister went to see General de Gaulle some months ago. What the outcome of it was we were never told. We ware given one of those colourless statements which cover anything which could have happened. We just do not know. We have from time to time—and I want to pay a tribute to the Lord Privy Seal—been given progress reports, but what do they amount to? Generally speaking, a summary of the subjects he has been discussing, and I would defy most noble Lords to conclude from these summaries and these reports what has actually been agreed upon; there may be some who can, but I am not among them. The effect is that we just do not know. Broadly speaking, we are no wiser to-day than we were a year ago as to what is the present position and what are the real prospects of our arriving at a compromise on the various matters which are being discussed.

To a great extent I would say that there has been very unsatisfactory publicity about the whole of these negotiations. I think that the public might have been much better informed than they are. The noble Lord, Lord McCorquodale of Newton, was quite right as to the extraordinary, incredible ignorance which exists in many quarters as to What the Common Marked is all about. To-day I would say that it is probably the main topic of conversation wherever one goes. Wherever two or three people meet together, sooner or later they begin talking about the Common Market; and I am sorry to say that, apart from enlightened businessmen such as the noble Lord, Lord McCorquodale of Newton and others, by and large more people seem to be against the Common Market than for it; and when you come to discuss it with them you find that their objection is based entirely on ignorance. There is a tremendous educational task which this Government will have to undertake if they are going even to come to an agreement with the Six on the various conditions which we wish to impose, because to try to bring this Common Market into effect in the face of a reluctant, grudging, suspicious public would be fatal.

I would suggest to the Government, to the Foreign Secretary and to the noble Earl, Lord Dundee, in particular, that they really should make a very strong point of seeing that the public is really informed about all the issues and given as many facts as possible. I know that the Government have published one document, which I have tried to read myself. I must confess that I found it very heavy going. I think it was an objective document; I found nothing unfair about it; but it really was very heavy going. To expect the members of the public to read this document and to understand it is really asking too much.

I said that we have tried to express our views in this debate, Whatever they may be, in the light of wholly inadequate information. But, before I go on to the subject of the merits and demerits of the Common Market, I want to pay a tribute to the Lord Privy Seal. I feel free to do that, because this subject cuts right across Parties; there are opponents on both sides of the other place, and on both sides here, of the Common Market, and there are supporters, and I feel that a tribute is due to the skill, patience, diligence and dignity with which the Lord Privy Seal is carrying out these negotiations. I should like to emphasise dignity, because my noble friend Lord Attlee suggested that we might be approaching this matter with cap in hand. I do not believe that these negotiations are being approached in that spirit. I cannot think for one moment that Mr. Heath really is going with cap in hand on these negotiations.

I have criticised the Government for not giving us a clear picture of what is going on. I want to say that I understand their difficulties. When you are negotiating you cannot constantly be explaining to the public every step you are taking. You cannot have people looking over your shoulder all the time watching every step. There has to be a tremendous amount of give and take in negotiations. You give something there, you accept something in exchange. If you merely explain what you have given away you are criticised for that, and you find it very difficult to explain that you got something in return. Really, the only sensible thing, if one can get away with it, is to present the whole picture, what you have given and what you have got in exchange. And let us not be so foolish as to imagine we are going to get it all our own way in these negotiations; we are not. I agree with the noble Earl the Foreign Secretary: we are not negotiating from weakness; I do not think we are particularly negotiating from strength, either. But I think we are negotiating on equal terms, and on that basis one must expect to make concessions and to have concessions granted. All one can hope is that one is putting one's case fairly, forcibly, and ensuring that the people with whom we are negotiating really understand our position.

Nevertheless, for all that, and realising these difficulties, I do think that the House has welcomed this opportunity of having a final talk before we go into Recess, and we have had a most excellent debate. I think the case has been put extremely well from both sides. We have had the case against entering the Common Market most admirably presented by my noble Leader, and by my noble friend Lord Attlee, whom (I should like to echo the words of the noble Lord, Lord Balfour of Inchrye) we welcome back to our discussions, and we are delighted to see him in such good form. He certainly was in good form this afternoon, and I think he put up as good a case as could be put up against entering the Common Market. My only regret is that I completely disagree with him; but that is the way this discussion has been going all along.

I should like to make a few general remarks about the kind of debate we have had. What I feel is that all noble Lords who have opposed entering the Common Market have put up an admirable case. My noble friend Lord Lucan, who spoke at short notice, put up an admirable case against the Common Market. I think I could have done so, too, if I had selected my facts, ignored every argument in favour of the Common Market and merely produced the whole of the argument against. Of course you can put up a wonderful case. So you can in favour of the Common Market if you ignore all the case against it. The fact is that it is a very difficult decision to arrive at. Even the Government must have found it difficult to make up their mind as to whether or not they should recommend making application; I imagine so, otherwise they would have decided to enter the Common Market right at the very beginning, in 1956, when it was first under discussion. At that time they must have decided against it and they must eventually have come to the conclusion that the case for entering the Common Market is stronger than the case against. I am not at this stage complaining about it. Everybody is entitled to change his mind, and if one does so after due consideration and honest thought, all right. But it is and it has been a very difficult decision to make. One can argue both ways, and I have argued both ways to myself. But at the end of the day the position is that you have to decide either to go in or not to go in.

With great respect to the noble Lord, Lord Strang, for whom I have a great admiration, it is no good coming here and quoting the opinions of economists who are cautious and doubtful and not quite sure. You can find plenty of them. I would much rather take the view of the noble Lord, Lord McCorquodale of Newton, who is himself a great industrialist, who speaks from personal experience, not only his own but that of many with whom he is in contact, and who really believes that our entry into the Common Market would be of advantage to this country. I would much rather accept that than the views of 50 economists who cannot make up their minds and are cautious. But I think that in making up our minds we have to be quite certain we do not go to extremes in either case.

There are those who take, to my mind, the exaggerated view that if we do not join the Common Market we are virtually finished, that we are what somebody described as "an off-shore island", that our economy will inevitably break down and that we have no future before us. I do not accept that. I have come to the conclusion, of course, in supporting our entry into the Common Market, that it is definitely to our advantage. Nevertheless I am not prepared to say that if we do not join, all that faces us is ruin. After all, we have a population and we have skilled personnel; we have a vast know-how; we are still ahead in a great many industries; and I think somehow we should make a living, perhaps not as good as we have been able to do up to now, but we should survive.

On the other hand, it is wrong to give the impression that by joining the Common Market we automatically reap substantial and immediate advantages and that our economic difficulties are over. The benefits are going to be long-term, and they will depend upon our taking advantage of the opportunities offered to us rather than something that is going to be handed to us on a plate. If we fail to seize these opportunities we shall be no better off, and probably worse off. But I am confident that given the opportunities we shall accept them. I am tremendously encouraged by the spirit of this debate, by the various industrialists whom we have heard, who are already preparing and planning for the day When we may be joining the Common Market, and I believe many of our industrialists are doing the same. I have little doubt that we shall seize the opportunity and that our industrialists, and our workers too, will be equal to the occasion. These opportunities are there; they are immensely bigger, and afford a rapidly expanding market for our goods at lower prices.

I want to emphasise "lower prices". I think that is important. I believe "hat with a bigger market to serve we shall be able to lower our prices, and the result will be not necessarily a reduction in taxation—I do not know; I would agree with the noble Lord who spoke about Parkinson—but at least more money circulating. People will be able to buy more goods for the same amount of money and therefore there will be more employment and more prosperity.

I do not want to elaborate on the advantages of the Common Market, because that has been done to a large extent during these two days. On the other hand, I do want to warn those who are against our entry that it is not right to say that to join the Common Market involves the end of the Commonwealth: it does nothing of the kind. I should be sorry to have it thought that the existence of the Commonwealth depends solely upon tariff preferences; it does not. In fact, tariffs are being reduced, preferences are being reduced. In some cases, there are no preferences at all. Even the trade between ourselves and the Commonwealth is less than it has been. I hope that it will increase again, but recently it has been on the decline. Our association with the Commonwealth, this great Commonwealth conception, is much deeper, something much greater, than merely a financial partnership.

I refuse to accept the fact that, by negotiating for entry into the Common Market, our relationship with the members of the Commonwealth will be in any way affected. We have come to believe that the Commonwealth are unanimously against our entry, but that is by no means the case. There are many members of the Commonwealth who take a different view and accept the fact that not only are we entitled to make our own decision, but that in fact it will benefit them as well as ourselves. In this connection an interesting statement was made only a few days ago by one of the leaders of the Commonwealth in Australia, when he said: I believe, on close factual analysis, that the potential effect of Britain's entry on the Australian economy has been greatly exaggerated. Politically, its implications are much more far-reaching. If Britain does enter, I do not believe the overwhelming majority of Australians will notice any change or be affected materially. I would suggest that that is probably a true statement, and while I understand the Commonwealth Prime Ministers are trying to get the best possible deal, I believe, and cannot help thinking, that in their heart of hearts they must to a large extent accept this view.

Now I want to say a few words about two other conditions upon which we require to be satisfied: the position of the farming industry in this country, and of the European Free Trade Association. Naturally, the Farmers' Union are putting up a big fight, nobly assisted by my noble Leader, to maintain the status quo. To me, this is a sorry confession; it is a confession that the farming community is not capable of holding its own in the great European market and of competing with others. I always thought that our farming industry was highly efficient. It was necessary to subsidise it against certain natural advantages which some States might have—such as Poland, who were able to export to us pigs at a cheap price because of the state of their economy—but I thought, by and large, we were able to compete with any farmer in Europe. I believe that to be true. Given an equal chance with other farmers in the European Community, I am confident that we shall be able to compete and shall not need any subsidy or assistance at all. It shows a lack of courage and confidence to take the other view.

In any case, we have been assured that the position will be reviewed periodically, and if it should should turn out that I am wrong and that we are at a disadvantage as compared with the European farmer, then the matter can be reconsidered and something will be done about it. The same applies, of course, to the farm products, to the raw products which will be imported from the Commonwealth. I hope we can get something a little more concrete; but a periodic review and an undertaking that the matter will be looked at in the light of circumstances is, in my view, going a long way. There may have to be certain adjustments. We may have to reconsider the items which would most suit the European Market. But we have always been quite flexible in our farming operations, and I see no reason why we should not be again. Our technical equipment is as high, our wages are no less, no greater, than those of the farming communities in Europe; and I am quite confident that we shall be able to compete.

The other condition that has to be satisfied is that the members of the European Free Trade Association will be admitted. I agree that at one time there was a somewhat ambiguous statement made by Dr. Adenauer, to the effect that the European Community was already large and that he did not favour its becoming very much larger; and it was implied from that that there might be difficulties about the entry of various members of the European Free Trade Association. In fact, however, it applies only to two—Norway and Denmark. The other members of the EFTA —excepting Portugal—are neutrals: Austria, Switzerland and Sweden. They would not be eligible, if one takes into account the possible political implications. So, from the point of view of adding materially to numbers, there can be no real objection at all But I doubt whether Dr. Adenauer really had in mind members of the Free Trade Association at all. I understand that Norway and Denmark have made their application, the neutrals are discussing the possibility of some form of association, and I should imagine that no real difficulty will arise in that sphere.

The noble and learned Lord the Lord Chancellor gave us an address on the effect of the Treaty of Rome on our legal system, and, with all humility and respect, I should like to say that I agree with him completely. In this I am not merely relying on my own legal expertise; I myself have had investigations made by certain eminent lawyers, and there is no material difference between their view and his. So I am glad to say that on this we are ad idem. I would agree with him that they are not vital matters with which we are concerned. We have to hold a balance. We are really concerned about people who are going to break certain Articles of the Treaty and how they are going to be dealt with. A person who does not break any Article of the Treaty does not come within the scope of what the noble and learned Lord Chancellor has told us at all. If you do break any Article of the Treaty the question is, are you to be dealt with under English law, or under the law which is being laid down under the Treaty of Rome? I do not think that is a very vital matter which should affect our judgment in going into the Common Market.

Finally, I want to say a little about what is, to me, the most important aspect of our proposed membership—the prospect of a Political Union. The Treaty of Rome contains no direct provision for any form of political association at all, but it is implied that, as the nations get closer together, so some form of political association will become inevitable. It is impossible to get freedom from tariffs, free movement of capital, common services, provisions relating to the gradual raising of the standard of living throughout the Community, greater mobility of labour, and a variety of other things of that kind, without bringing into operation a closer association than a purely economic one. One has to recognise that gradually there will have to be some form of common law which will be applicable throughout the Community in relation to these various matters with which the Community deals. This has been put forward in some quarters as a sacrifice of sovereignty, and the noble and learned Lord who sits on the Woolsack has dealt with that, as bas the noble Lord, Lord McNair. But what it amounts to is this: that in entering into the Treaty of Rome you make some sacrifice of the right to decide a number of matters of that kind for yourself; and that is the price we have to pay. But I realise that we shall probably evolve some system of legislation covering the economic field provided for in the Treaty of Rome, and possibly even going beyond.

The noble Lord, Lord Strang (I am afraid that he has gone, but he is always interesting and exceedingly authoritative on these matters), suggested that the only practical form of political association was a federal one. I understood him to suggest that at the present moment, in view of the leadership of many of the countries of Europe in the Community, that was not practicable. He is probably right, but I have little doubt myself that sooner or later force of circumstances will force us into some kind of federal unity. The exact details, of course, it would be absurd to try to describe at this moment. But is there really any serious objection to the Community's having a common foreign policy, and even a common defence—within, of course, the larger scope of N.A.T.O.? It does not seem to me to be unthinkable. I certainly regard this aspect as perhaps the most valuable aspect of our membership of the Community.

We have to remember that for many centuries Europe has been a constant cockpit, with wars between one nation and another every few years. France, Germany and ourselves have generally been involved; we as part of the price we have paid for trying to maintain the balance of power; others, perhaps, trying to seize power. But we have constantly been involved in wars or threats of wars, and to-day it looks as if the day of wars in Europe, at any rate, is coming to an end. No one, as a number of noble Lords have suggested, could possibly have thought conceivable that France and Germany should be in an organisation together, and in harmony. But I feel that there is a possibility, certainly in the minds of a great many people, and even a fear, of one or other of these great States dominating in the Community—probably a greater fear of Germany than of France. I have no doubt that our entry into the Community would have the effect of holding the balance, and I do not think we need be afraid of the rest of the Community "ganging up" against us. There is, in fact, as I am sure the noble Earl the Foreign Secretary will appreciate, a built-in safeguard against "ganging up". On the important matters there has to be unanimity; and on others we can pretty well ensure that it would be virtually impossible for us to be out-voted on any important matter. Therefore, I particularly welcome the possibility of a move towards a European community, as a step, perhaps a small step, towards world government. My noble friend Lord Attlee takes a different view. I think that any organisation which brings nations together, and enables them to live in harmony and to work for a common purpose, is a step in the right direction. It may be a very halting step; it may be a long way off, but it is a movement in the right direction.

My Lords, in the determination of the policy of political integration, we have a vital part to play. We should therefore participate, if for that reason alone, in the tentative discussions that are about to take place on political union. I know that there has been some discussion as to whether we should be allowed to participate in these talks before we actually join, but I feel that it would be of great advantage that we take our place in these political talks, if we can, even before we actually join. In this matter, which transcends and cuts right across Parties, I personally wish the Government every success in their efforts, believing that they have it in their power to make an outstanding contribution to the happiness and welfare of this country, of the Commonwealth, and of Europe.

7.32 p.m.

THE MINISTER OF STATE FOR FOREIGN AFFAIRS (THE EARL OF DUNDEE)

My Lords, the last time I had to wind up for the Government in a debate on the Common Market was in June, 1961, a short time before we began to negotiate. In that debate I had the great pleasure, which has been repeated to-night, of following the noble Lord, Lord Silkin, who wound up for the Opposition Front Bench. When I began my few remarks on that occasion, by telling the noble Lord, Lord Silkin, that I agreed with everything he had said, he interjected a little unhappily that that was not going to do him any good with his Party. I am very anxious not to do the noble Lord any harm, nor any others of your Lordships opposite. I would only say that I have taken careful note of what the noble Lord said, particularly about the need for giving greater publicity to the Common Market.

I will not say that I agreed with everything he said, and I shall refrain from emphasising the excellence of the speeches that were made by Lord Silkin himself, by the noble Earl, Lord Longford, and by the noble Lord, Lord Morrison of Lambeth, on the Front Bench, supported by the noble Lords, Lord Shackleton, Lord Huntingdon, Lord Peddie, Lord Citrine, and a great many others behind them. Just to make everything fair all round, I shall equally refrain from adverse criticism of the noble Viscount, Lord Alexander of Hillsborough, the noble Earl, Lord Attlee, and the noble Earl, Lord Lucan, because I always find that it is a good plan to keep an even balance among your opponents, when they are having a real "set-to" among themselves. Therefore, I would only say What wonderful speeches they have all made, very strong, powerful speeches against the Common Market, and equally good ones for it.

My Lords, the Conservative Party, too, is not altogether without merit in this ability to disagree with each other.

LORD BOOTHBY

What about the Cross-Benches?

THE EARL OF DUNDEE

We are able to show some modest amount of disagreement among ourselves. I am afraid we cannot compete with noble Lords opposite, and we cannot claim to have a Royal Flush in our hand. And we have not produced a Front-Bench speaker who has enough dialectical skill and ingenuity to perform the spectacular achievement of disagreeing in public with one of his colleagues in your Lordships' House, and another colleague in another place at the same time, but in different senses. The only Party which does not get any marks at all, is the Liberal Party. I think this is the first political discussion I have heard in 30 years, in which the Liberal Party have all completely and utterly failed to disagree with each other. My Lords, quite apart from the robust disagreement which he expressed against everybody else, I should like to say how glad we are to see the noble Earl, Lord Attlee. When he was in hospital not long ago, we all thought of him a great deal, and we are truly delighted to see him come back in such good form, and to hear him make a speech of such forthright vigour.

I must just take up one or two points with the noble Earl, Lord Lucan. I was so glad that he intervened. He made a most interesting contribution to the debate, but there were two things he said on which I do not think I can refrain from commenting. One was—if I heard him rightly—that we went into EFTA in order that we might not go into the Common Market. My Lords, I am afraid that the noble Earl cannot have been paying much attention either to myself, of which I do not complain, or to many of his colleagues. I had the duty of taking most of the debates on EFTA, and all the debates on the EFTA Bill in 1959 and 1960. This Bill was specifically chosen, not as a means of keeping us out of the Common Market but as a means of helping us to get in.

I remember that, whenever we had a discussion or a question on the subject, the late Lord Pethick-Lawrence, and others of your Lordships opposite, used to press me and say: "You have got your EFTA now. What are you doing to press on to your ultimate goal of an economically united Europe?" I had to defend myself by saying: "We have had EFTA for only a short time. We are advancing towards this goal, but we do not want to bang on people's doors and rattle their windows". It was always understood, on both sides of the House, that the main purpose of EFTA, although we thought that it was a viable thing itself if we should fail to get any further, was to lead us to a wider association and to join the Common Market—not only ourselves, but with those other nations which we were bringing in.

The other point to which I want to refer, which the noble Earl, Lord Lucan, brought forward, is about the decline in prosperity or economic efficiency of Germany and France, about which I am afraid I am a little behind the times. I was not quite aware of it. Because every time I have heard the economic conditions of Europe discussed by noble Lords opposite, they have always presented me with a whole lot of what they call "league tables", showing how Ger many, France, Belgium and all the Common Market countries are racing ahead of us, with a gross national product which is increasing by a most satisfactory percentage each year, whereas we are limping behind with an average of 2or 3 per cent. It seems to be a very great pity, my Lords, that, just when we had decided to try to go in and join them economically, they should have suddenly encountered this sad economic decline, and I hope it is not going to last too long.

My Lords, there is one other thing that I should like to mention—in fact, I think it was really the most important thing in their speeches, on which the noble Viscount the Leader of the Opposition and the noble Lord, Lord Morrison of Lambeth, thoroughly agreed with each other. The noble Viscount said that he heartily supported the decision of the Labour Party to defer making up their minds on this matter until further information was available. The noble Lord, Lord Morrison of Lambeth, said in his speech, that he reserved judgment until the end of the day when we knew in fair detail what the proposition really was. I do not see how anybody can disagree with these observations. I do not see how we can expect any clear-cut and consistent division of opinion about the Common Market to develop or to crystallise until we have more information than we have now.

If the Government were to say, "We have now reached an agreement with the Six under which they have given us guarantees concerning the Commonwealth, agriculture and EFTA which we consider to be acceptable, and we therefore intend, after consultation with the Commonwealth, to ask Parliament for authority to sign the Treaty of Rome", then you would have a clear division of opinion between those who thought the Government were right and those who thought that they had not demanded or secured sufficient guarantees for the Commonwealth and the other interests concerned, and that these guarantees were not acceptable. Or, if it went the other way, if the Government were to say, "We have so far not been able to secure what we regard as the minimum acceptable conditions, and therefore we are bound to tell you that, until the Six modify their attitude, we cannot sign the Treaty of Rome", there would again be a division of opinion between those who thought the Government had done the right thing and those who thought that they had been too exigent in their demands.

There are, of course, a few people who think that we should go into the Common Market on any terms, and there are also a few who think that we should not join the Common Market on any terms at all. But I believe that the great majority of people are waiting, as the noble Lord, Lord Morrison of Lambeth, said, until they know in fair detail what the proposition really is. They cannot at this moment finally make up their minds—and I think that includes everybody like the noble Lord, Lord Strang, Sir Roy Harrod and Colin Clark, to whom he referred. Of course, I am only talking about a clear division of principle which may emerge on the general question whether we should sign the Treaty of Rome. There are a host of minor questions which cannot be settled until long afterwards, because they have not yet been settled, or even thought about very much, by the Six themselves—and if we do not go into the Common Market these questions will still not be settled by the Six, in all probability, for two or three years. The only answer you could make is that, if we do go in, we could help to settle them.

A great many of these questions were asked in the debate to-day. I will mention just one of them, which was shot at me by the noble Earl, Lord Howe, just before the noble Lord, Lord Silkin, rose. Lord Silkin said he was very grateful that he did not have to deal with it, and I think he was quite right to say so, because he could not have said very much, All he could have said was this: that the question of the future of British shipping has been raised in our discussions. The Minister of Transport is in close touch with the General Council of British Shipping, and will continue to keep them informed of developments of interest to them. But, as the Six have not decided on any particular policy about it, naturally we cannot know any more.

The trawler industry, also, we have been thinking about. It has a direct interest in the development of a common fisheries policy. That, too, has not yet been formulated by the Six, but I believe the Six may start talks upon it later in the year, and we shall certainly want to ensure that they are aware of our views and our desire to ensure to the fishermen a reasonable livelihood and proper working conditions, together with stable markets.

LORD BOOTHBY

My Lords, I must apologise for interrupting the noble Earl, but does he realise that if we are going to do that we must, by joint action, stop over-fishing of the North Sea?

THE EARL OF DUNDEE

My Lords, I would not have mentioned this question if I had realised that my noble friend Lord Boothby was listening to me so intently, as he evidently was. It is indeed injudicious to talk about fishing when he is anywhere within earshot. Personally, I agree with him very much that we shall have to stop the fishing.

VISCOUNT ALEXANDER OF HILLSBOROUGH

But, not on fishing but on the general remarks that the noble Earl is making, have there not been sufficient precedents already in decisions by the Common Market authorities that any advances or special helps we could show to our shipping industry can be regarded by them as distorted competition? The whole basis of the Common Market is cut-throat competition among the Six; and therefore any aids we may give, especially by rating reliefs or anything of the kind, can be said to be likely to be wiped out when you come to deal with it.

THE EARL OF DUNDEE

My Lords, I had not intended to pursue at great length the question of shipping or of fish, and I should like to get on because we are getting very late.

VISCOUNT ALEXANDER OF HILLSBOROUGH

I thought you might find it difficult.

THE EARL OF DUNDEE

Several of your Lordships, including the noble Lord, Lord Boothby, and the noble Lord, Lord Sillkin, who spoke last, and the noble Lords, Lord Peddie and Lord Shackle-ton, have all talked about the timetable. They have argued that this question is much too important to be hurried. My Lords, I certainly agree that it is. Of course, one would like to get a broad outline of a possible settlement, if we could, before the Commonwealth Prime Ministers' meeting in September, and from many points of view, naturally, the sooner we got a satisfactory agreement the better it would be. But it is quite true that if it is not going as fast as you want, you cannot hurry it. I would emphasise to your Lordships that the current meeting does not present in any way a formal deadline. The fact that the newspapers have represented it as a particularly critical meeting does not in any way mean that everything has to be settled one way or another this week.

My Lords, I do not in the least complain about this debate being held at the present time, because I think your Lordships all wanted, or most of your Lordships wanted, to have an opportunity of expressing yourselves on this question before we rose for the Summer Recess. I never complain when the Government are pressed to give more information; and, when we do give it, and when our interrogators complain that it is indefinite, I think that is quite a legitimate complaint—it is indefinite. The unreasonable thing would be to go on demanding more information when everybody knows that, in present circumstances, it can only be information of an indefinite character. But I do not think your Lordships bave done that today. I believe it is generally recognised that, in the present stage of discussions, we cannot tell your Lordships any more Chan we have told you already, and we cannot be more definite than the result of the negotiations themselves in which we are engaged.

Of course, I am very anxious, as your Lordships will understand, to say as little as possible myself, not because I am in any way of a taciturn disposition but because, even if my remarks were the perfect masterpiece of correct analysis and of wise comment, I do not think that would add anything to your Lordships' knowledge at the present moment. Nor would it be any particular use in the negotiations at Brussels. I do not think it would be of any help to my noble friend the Lord Privy Seal. On the other hand, if I were to make any observation or to use any phrase which might be capable of being taken out of its context and misrepresented by some newspaper as being too provocative, on the one hand, or too compliant, on the other, that really might add a little to the difficulties which the Lord Privy Seal is contending against with such great perserverance, swill and devotion.

My noble friend Lord Balfour of Inchrye, in the course of a very powerful argument, said that he thought the disadvantages of going into the Common Market were exaggerated. On the other hand, yesterday some of your Lordships had an argument as to whether it could rightly be said that the breakdown of negotiations would be a disaster; or, if not a disaster, whether it might be called a tragedy. I understand that the Leader of the Labour Party, Mr. Gaitskell, has said that it would not be a disaster. I am not going to comment on any of these propositions, but I should like to tell your Lordships this: that the success of the negotiations would be regarded as a disaster by the Governments of the Communist countries behind the Iron Curtain. It is part of my duty to keep an eye on the great Communist propaganda machine which is active not only in Europe, of course, but in every continent, and in every part of the world. That machine is now all geared up to give priority to the Common Market above everything else, and to represent that it would be a disaster to the people if the Common Market were to succeed, and particularly if Great Britain were to enter it.

My Lords, the reason is not very difficult to see. The rulers of the Communist world are beginning to be afraid that the expansion and economic growth of the Common Market in Europe may finally prove the falsity of the old Marxist legend that free democracy cannot advance economically, and that the only way of advancing material prosperity is to have a dictatorship of the proletariat. That is the doctrine which they have been spreading not only in Europe but, with some considerable success, in all the new emergent countries, the underdeveloped countries, who are very apt indeed, considering their own poverty, to be deceived by the proposition that they can achieve material advancement and wealth only by adopting some dictatorial form of government.

Now the Communists are seriously afraid that these underdeveloped countries, these emergent countries, these uncommitted countries, will be led, by the example of the Common Market and its ability to help them, to see the falsity of the Communist doctrine. They are afraid that the people of Western Europe will be confirmed in their rejection of Communism, and they are afraid, too, that people behind the Iron Curtain, when they see what is happening on the other side, may begin to demand that they too should be allowed to have a share in this new prosperity and that the idea of peaceful coexistence should become more of a reality.

THE EARL OF LUCAN

My Lords, would the noble Earl explain whether that shows that it would be an advantage to this country to go in?

THE EARL OF DUNDEE

My Lords, I am not going to spend time in arguing whether the Communists are right in their appraisal of the situation; but that is what they are doing now, and I think I have given the right reason for it.

THE EARL OF LUCAN

It has no bearing on those countries.

LORD BOOTHBY

It has a lot of bearing on it.

THE EARL OF DUNDEE

It has more bearing on this country than on any other aspect of the question, because it is against the entry of this country that Communist propaganda is now being mobilised and launched. It is because they think that Britain may come in, and because they are afraid of the con sequences of that, that they are doing their best to stop it—

LORD SILKIN

My Lords, is the noble Earl suggesting that we ought to decide this matter on the basis of what the Communist countries are thinking?

THE EARL OF DUNDEE

Really, my Lords, I do not think that is a very sensible interruption. I think my argument is good, but it is not the only one. Why should it be thought that when I give one argument it is the only argument for doing something? I do not understand the way the noble Lord's mind is working at the moment. It is getting very late at night, I know. But I should like to say to your Lordships that I think that in this respect the Communist apprehension may be right, because it seems to me that the influence of the European Economic Community on the world may depend a great deal on whether Britain is able to join, and to provide, not in every case for association, but at least for the proper consideration of the economic needs of those countries overseas which are now dependent on the British market for their economic life. If the Community develops into an introspective and exclusive association for the protection of monopoly and the maintenance of high prices, it will not help the progress of the Free World; and it is the hope of liberal-minded statesmen throughout the Free World that the Common Market in Europe, together with the United States, will lead the rest of the world to a freer and more abundant exchange of wealth.

The noble Lord, Lord Morrison of Lambeth, yesterday made an appeal to the Governments of the Six. He said (col. 302): … I should like to make a very sincere appeal to the Governments, the nationals and the political parties of the Six European countries to understand the real problems and difficulties with which the British are faced in these negotiations … and I am sure all your Lordships hope that the noble Lord's appeal may be heard. The Six have agreed that there must be international arrangements which will provide a fair reward to the primary producers of the world based on expanding trade and growing purchasing power. We agree with that, but we do not think it is enough; and we are asking that special provision should be made for countries who, in spite of such arrangements, might suffer from changes in the pattern of trade which has grown up in the past on account of their association with us.

My Lords, we think this is a reasonable demand, because although it might not prove necessary in the event, it would be a bad thing for everybody if the confidence of these nations of the White Commonwealth in their own commercial future were to be adversely affected by our adherence to the Treaty of Rome, which ought to help them if it succeeds in its aims. These young nations—New Zealand, Australia and Canada—are European in stock and in tradition. They are, of course, predominantly British, but not entirely so. In Canada there is an ancient French Community which has been in the Province of Quebec since the seventeenth century. Their languages, their institutions, their civilisation and their religion are derived from the same origins as those of Western Europe, and if this great adventure in human history is to prosper economically and politically it must enjoy the friendship and the goodwill of the White Commonwealth, which must be enabled to co-operate with Europe in serving the cause of world peace and prosperity.

7.59 p.m.

VISCOUNT ALEXANDER OF HILLSBOROUGH

My Lords, I should like first of all to say that I am greatly indebted to all the Members of the House who have spoken in this debate, which, as so many people have said, has maintained such a high standard. I particularly want to thank my noble friend Lord Attlee who has spoken to-day for his kindness in coming along and supporting me as the first supporter to-day on anything I might have said yesterday. Not a single Member of your Lordships' House gave me any support whatsoever yesterday. I have been much more fortunate to-day, in that I have had two of my Front-Bench colleagues supporting me here, one eminent occupant of the Cross Benches and one courageous Conservative, in the person of Lord Balfour of Inchrye. I am grateful to all of them for that privilege. I have no complaint to make about any of the speeches which have been made against my point of view. I have a feeling, however, that when the rest of the Commonwealth read this debate, they will regard the general consensus of opinion expressed in favour of the Common Market as being a kind of vote of no confidence in the Commonwealth. The arguments which have been used about how urgent and necessary it is to go into the Common Market, because of the changed circumtances in the Commonwealth and the like, are a complete departure from the great demonstration of imperial policy issued from the headquarters of the Conservative Party, to which I referred yesterday. Nevertheless, this must be judged by the members of the Commonwealth themselves.

We are most grateful to the noble and learned Lord the Lord Chancellor for the careful summary he gave of the legal position, which we shall all have to study in detail with regard to our individual difficulties about the interpretation of the Articles of the Treaty of Rome. I think it might involve many industrial and commercial organisations in seeking legal advice, to see how the 200-odd Articles in the Treaty match up to their particular needs and difficulties. At the moment, I am unhappy about one or two things. I notice that in the local Labour Party submissions to the Labour Party Conference a great deal is made of this, not by an untutored Labour Party, by any means; it happens to be the Cambridge Labour Party and it possibly has a good deal of educated consideration behind it.

I am sorry that we did not have an answer from the noble Earl, Lord Dundee, in his reply, to the point of my noble friend Lord Attlee with regard to the argument of the Foreign Secretary, which I noticed received the headline in the London Times to-day, about the necessity for this country being in the Common Market because of the centre of trade and power. We did not get any real answer to what my noble friend said, but that must wait for a further occasion. However, I am glad to see that the Government propose to take notice of the timetable argument which has been used. I would remind the House, which has not perhaps forgotten all that happened yesterday, that I raised this at the beginning and pressed it upon the Government, and I am glad to see that it is likely to lead to the proper position. After all, when one reads in this morning's Press reports of the assumed happenings during Mr. Heath's conversations yesterday, it seems that there was no improvement. In fact, France seems to be trying a special block.

Once more I am reminded of the speech of M. de Murville on June 13, in which he said that perhaps something might be presented by the end of July, but more probably by the autumn. It would have been better not to present the general statement, which I think was in the mind of the noble Earl when he was speaking, unless we had a really firm acceptance, before the Commonwealth Premiers meet, of the unalterable conditions in regard to the Commonweallth which I understood from the Prime Minister was going to be arrived at before we could consider going into the Common Market. I will leave it at that for the time being.

I hope that the general tendency will be for us all to read the arguments carefully in the OFFICIAL REPORT and to make up our minds even more firmly. I would end by saying that I hold with conviction the view that all the experience of the last six weeks has hardened opinion in this country, not with those who wish to go in, but steadily against them. I beg leave to withdraw my Motion.

Motion for Papers, by leave withdrawn.