HL Deb 31 May 1962 vol 241 cc279-89

3.40 p.m.


My Lords, with the permission of the House, I wish to repeat a statement being made by the Lord Privy Seal in another place on the progress of the Brussels negotiations. I again intend to publish in the OFFICIAL REPORT a more detailed account of the latest developments.

On May 16 the Lord Privy Seal said that the last Ministerial meeting marked the end of the first stage: the way was open for the negotiation of solutions. Of course, the House will understand that any agreement on the solution of individual elements in the negotiations remains subject to overall agreement. The momentum has been maintained both in the meetings of the Deputies of Ministers and in the Ministerial meeting which ended in Brussels yesterday.

At this meeting agreement was reached on the tariff treatment to be applied to our imports of industrial products from Canada, Australia and New Zealand. As regards these commodities, the Lord Privy Seal said in his opening statement in Paris on October 10 that we recognised that indefinite and unlimited continuation of free entry over the whole of this field might not be regarded as compatible with the development of the Common Market. The solution now worked out provides that the common external tariff will not be applied to these imports in accordance with the normal timetable, but in three stages: the first stage on accession, the second stage on January 1, 1967, and the third stage on January 1, 1970. The European Economic Community at one time proposed that this delayed application of the tariff should only relate to a limited list of goods, but it is now agreed that all industrial exports are included. It was agreed that the Community would be ready to take part in multilateral negotiations aimed at reducing, on a reciprocal basis, the level of the common tariff on industrial products. The agreement also provides for consultation between the enlarged Community and Canada, Australia and New Zealand in 1966 and again in 1969, after which appropriate steps would, in the light of all the circumstances, be taken in conformity with the provisions of the Treaty.

Ministers carried a stage further the discussion of the most important and extremely difficult question of the treatment of imports of temperate foodstuffs from the Commonwealth, both during the transitional period and in the long term. In this connection we have put forward certain proposals on cereals which will be discussed by Ministers Deputies next week.

The Ministers had a long discussion of the list of products, mostly industrial raw materials, on which we have asked for a nil tariff. In some cases the Community have suggested alternative arrangements to meet the essential needs of ourselves and our suppliers. Deputies have been asked to examine these alternative proposals together with our own with a view to submitting solutions to Ministers at their next meeting.

We have made comprehensive proposals for dealing with the exports of India, Pakistan and Ceylon, and emphasised to Ministers the importance of making arrangements to protect the essential export interests of these countries. The Government of India have also circulated a memorandum to the Six Governments. Our proposals, together with the memorandum of the Government of India, will be examined further by the Deputies.

Ministers also had before them a report by a Working Party on the problems of British horticulture. The Deputies will examine it in greater detail taking account of individual commodities.

Finally, a report was made on the discussions which have been taking place between our Delegation and the Commission on the provisions of the Treaty of Rome concerned with economic union. The Lord Privy Seal was able to tell the Minister that these discussions have satisfied us that, on the most important matters dealt with in these Articles, we can accept the Treaty, subject to a small number of adjustments on timing and administration.

The next meeting of Ministers will be for four days, June 27–30.

Following is the report referred to at the opening of the statement:

Since the last report on the Brussels negotiations on May 17 meetings of the Ministers Deputies and of working parties have continued. On May 29 and 30 there were meetings of Ministers at which we reviewed the progress made during the past fortnight and continued the process of seeking to negotiate solutions.

The present position with regard to the various problems under discussion is as follows.

Raw Materials and Semi-Manufactures for which we have proposed a zero tariff

The subject has been discussed in some detail by the Deputies and we had a further useful examination of the problems involved at our Ministerial meeting on May 29. We still consider and have re-emphasised that the most appropriate solution for each of the products on our list would be the reduction of the common tariff to nil. The Six find particular difficulty in meeting us on some products, but are not yet ready to put forward any alternative proposal. On some other products they have put forward proposals which are to be discussed by the Deputies.

Industrial Products from Canada, Australia and New Zealand

Ministers agreed on the following arrangements:

  1. 1. The United Kingdom would take the first step (30 per cent.) towards the application of the common customs tariff to imports of these products on the date of its accession to the Community. The United Kingdom would take a second step (30 per cent.) towards applying the common customs tariff on January 1, 1967. The United Kingdom would apply the full common customs tariff to all the products concerned on January 1, 1970.
  2. 2. Note would be taken of the readiness of the Community to take part in multilateral negotiations aimed at reducing, on a reciprocal basis, customs duties on industrial products.
  3. 3. The enlarged Community would be prepared to examine, in 1966 and 1969, in consultation with Canada, Australia and New Zealand, the development of its trade with these countries, after which it would take appropriate steps in the light of all the circumstances, and in conformity with the provisions of the Treaty.

India, Pakistan and Ceylon Exports

The Lord Privy Seal made comprehensive proposals dealing with the exports of India, Pakistan and Ceylon and emphasised to Ministers the importance of making arrangements adequate to protect the essential export interests of these countries. Ministers asked Deputies to examine these problems further, taking into account our own proposals and a memorandum communicated to the Governments of the Six by the Government of India. The Deputies have been asked to propose solutions for consideration at the next meeting of Ministers.

Association and Tropical Products

Deputies will revert to these subjects at their June meetings. Meanwhile we have put forward precise proposals regarding the tariff treatment of the various tropical products. The Six have not yet put forward proposals of their own or commented on ours, but hope to do so shortly. Meanwhile a Working Party has submitted a report analysing the trade in a number of these products, and the problems which arise, and is continuinig to work on further products.

Commonwealth Temperate Foodstuffs

Since the last Ministerial meeting Deputies have been considering our proposals for safeguarding essential Commonwealth interests in this field. We had a further discussion at the Ministerial meeting and the Six emphasised their view that the arrangements made would need to be consistent with the Treaty and the common agricultural and common commercial policies. The Deputies will resume their examination of this subject next week, and will consider the proposals which the Lord Privy Seal has submitted for arrangements for imports of cereals from Commonwealth countries.


During the period under review a Working Party has been examining the problems of British horticulture and has prepared an interim report which the Deputies discussed and submitted to the Ministers. The report set out our view of the problems and how we thought they might be handled, together with the views of the Six. We agreed that the Deputies should examine the problems in greater detail, taking account of individual commodities, and should suggest possible solutions.

Economic Union

The Lord Privy Seal made a report on the discussions which have been taking place between our Delegation and the Commission on the provisions of the Treaty of Rome concerned with economic union. The Lord Privy Seal was able to tell the Ministers that these discussions have satisfied us that on the most important matters dealt with in these Articles we can accept the Treaty subject to a small number of adjustments on timing and administration.


My Lords, I am very much obliged to the Foreign Secretary for giving us this statement. There is nothing very new in it, so far as I can see, compared with the report which has already appeared in yesterday's London Times. Nevertheless, some points do seem to me to arise. I took note that early on in his statement he said that … the House will understand that any agreement on the solution of individual elements in the negotiations remains subject to overall agreement". I am not quite sure exactly how that works out with regard to what was described by the London Times correspondent yesterday as the first British success in the negotiations. What sort of agreement is it? Is it the sort of agreement that any two prominent negotiators have shaken hands on? Is it final? Is it tentative? Is it, indeed, as an individual agreement, subject to agreement between the home Government here and a Conference of Commonwealth Prime Ministers? This seems to me to be very important in setting the opinion of the people in this country as to whether they are, in principle, for or against entry into the Common Market.

That is especially so when one remembers that people, very prominent people, on the Continent have even expressed the opinion that, if we go into the Common Market, the Commonwealth goes out so far as we are concerned. This seems to raise very grave issues. Apart from every other question—not going back on matters of sentiment, such as the services of the Commonwealth, given almost at a moment's notice, at any time we wanted them, in the past, and things of that kind—what many of us who perhaps are regarded as advanced politically in thought feel is that we ought surely, in this stage of political thinking in the world, to see that the only real way we can secure finally a social democracy is based upon getting a firm unity between various countries in the great Commonwealth which we have been setting up.

Therefore, I would ask, on top of what I have already mentioned to the Foreign Secretary: Was there a conference on this matter with representatives of the Commonwealth, before these particular proposals on the industrial tariffs concerned between now and 1970, were made? Was there any agreement that this was a reasonable thing to put forward? Because the London Times report seems to me to indicate that this agreement has involved a move from the position taken up by our Government, as well as a move from the position taken by the Community Governments. A little more light upon these matters might help us to collect our thoughts.

3.48 p.m.


My Lords, I think it is probably better that I should reply now, if the noble Viscount is agree- able. On the last point, the Lord Privy Seal has been in continuous touch with the Commonwealth representatives, both in Brussels and here, and they have a full knowledge, of course, of the kind of lines we are following in our discussions of these different matters concerned with entry into the Common Market.

I think we rather suffer from words here. In the early part of my statement—and I am glad the noble Viscount mentioned it—I deliberately drew attention to the fact that this individual element on which we have agreed in the last few days is one of a number which all hang together. When we say that we made an agreement yesterday, it is really a way of saying that we have been able to agree on certain propositions, and I do not know what else you can do. When you are negotiating and you find certain common methods on which you think you can reasonably proceed, I think you must express that as an agreement. But, of course, the agreement on one section will be dependent upon our ability to reach similar agreements on many other matters, and all these are related to each other. When we come to the end of July, let us say, when we hope to have a series of agreed solutions, then at some point this has to go to the Commonwealth Prime Ministers Conference to be looked at, and it also has to be accepted or rejected by Parliament. I think that these are the processes of negotiation and consideration by Parliament which Parliament would wish.


My Lords, I am much obliged, but when speaking in this way of agreement, I am anxious to know whether your negotiator, in expressing agreement, has uttered the words which I have always taken to be implied in the Government pledge—that it will be subject to acceptance also by the Commonwealth.


My Lords, what we are trying to do is to reach agreed solutions to a number of items, of which this is one. For example, we have the question of comparable outlets for Commonwealth cereals, and then there is the item of nil tariffs. There is a whole series of sections which are still open to be debated with members of the Common Market in Brussels and we hope to arrive at agreed solutions on them all. When we have done that, we shall come to Parliament and to the Commonwealth Prime Ministers, and it is for the Prime Ministers and Parliament to decide whether the all-over agreement is worth accepting or not. I very much hope that it will be possible to accept it, but I cannot tell that until we have seen all the sections fall into place and until we are able to present the whole picture to Parliament.


My Lords, arising out of the Foreign Secretary's statement, I wonder whether I can ask him this. As I understand it, the eventual position which will be arrived at as a result of the Brussels preferential agreement is that Commonwealth imports will eventually pay a tariff duty Whereas similar European products coming into this country will pay no duty and come in free. How is that position to be reconciled with the oft-repeated pledges of Ministers, such as that of the Colonial Secretary that Commonwealth safeguards must be adequate and enduring or the statement of the President of the Board of Trade in February last: I cannot conceive that any Government of this country would put forward a proposition which would involve the abandonment of Commonwealth free entry"? As some Commonwealth manufactures come in duty-free, how can the position which we shall eventually reach be reconciled with those oft-repeated pledges?


My Lords, the section we are talking about now is in a broad negotiation which deals with manufactured goods from the Commonwealth. The noble Lord is perfectly right. Over a period, the preferences on these goods will fade out—and I gave the dates. I also said, he will notice, further down in my statement, that the agreement provides for consultation between the enlarged Community and Canada, Australia and New Zealand, in 1966 and again in 1969—that is, at two periods during the fading out of preference on these manufactured goods. We should hope that the negotiations at that time between the enlarged Community and Australia, Canada and New Zealand would be such as to lead to advantages to those countries in the whole Com- munity. I cannot say exactly how they would work out, but I hope that on balance the Commonwealth would benefit from our membership of the Community and would be able to bargain with the Community as a whole about the export of their manufactures.


My Lords, does the noble Earl realise that people think that fading out for a hypothetical benefit in an unknown future is a high price to pay for abandoning the principle of free entry of Commonwealth goods, laid down since the Ottawa Agreements in 1934, and that it is a principle which is dear to many people, not only emotionally but practically as well?


My Lords, I fully understand that, but, of course, our preferences in Commonwealth countries have been steadily eroding and the principle has been eroded for some time. Of course we want to do the best possible bargaining we can for the Commonwealth export of manufactures. We are coming on to this most important section in the negotiations which deals with comparable outlets for grain, butter, wheat and commodities of that kind, in which Australia, New Zealand and Canada are particularly interested. At this stage, I can only say that we hope that, when the House sees the all-over picture, from the point of view of the Commonwealth, their judgment will be that joining in the Common Market offers better opportunities in the long run for Commonwealth exports than by Britain remaining out of it.


My Lords, the Foreign Secretary referred to the possibility that the overall negotiations might be completed by the end of July. If that should prove to be the case, he will be aware that Parliament customarily adjourns for the Summer Recess by the end of July or, in exceptional cases, at the beginning of August. Will he give some undertaking that the Government, when they have reached their over-all picture, will consult Parliament and a debate can take place in both Houses? Would that be before Parliament rises for the Summer Recess or would it be necessary for us to wait until Parliament resumes after the Summer Recess?


My Lords, I cannot tell whether we shall have completed the process of negotiation by the end of July. I think that perhaps that would be too optimistic. But we hope to get a much clearer picture of what might be involved. We have agreed through the usual channels, as the noble Viscount knows, that there should be a debate on these matters before the House rises.


My Lords, I had forgotten for the moment that the Commonwealth Prime Ministers are to meet in London in September. Presumably that would be a real factor in the time-table, which might make it undesirable that Parliament should debate this until the Commonwealth Prime Ministers have met.


My Lords, I would never invite an unnecessary debate, but I think that probably the Opposition and, indeed, the House as a whole might like to debate certain aspects of the Common Market before we rise. But perhaps we can look at that a little nearer the time. The noble Lord is quite right. The meeting of the Commonwealth Prime Ministers on September 10 is a very important factor in this whole picture.


My Lords, it is obvious, from a study of the matter, that Canada is the country most affected by this section of the negotiations. May I ask: have any representations been yet received from them in regard to the agreement that has been arrived at? Is it not very important, in dealing with the interests of our loyal adherents in the Commonwealth, that we should consider how they are to be individually, as well as collectively, affected? Canada has £70 million of exports to this country affected by this one agreement. And what sort of line will be taken by the Government of New Zealand, 67½ per cent. of whose output of dairy products comes into this country on the basis of free entry? It seems to me that our Dominions are likely to get a pretty raw deal, unless something is done about it.


My Lords, I very much hope that something will be done about it. We are very fully aware of the importance to the Commonwealth countries of the commodities mentioned by the noble Viscount. Of course, wheat, butter and meat are of particular importance to Australia, New Zealand and Canada. The House might be interested to know the amount of trade which is affected by the last talks which have just been completed in Brussels. The proposal is concerned with trade to a value of just over £55 million from the three countries together. It represents 2 per cent. of the total Australian exports to this country and less than one-quarter of 1 per cent. of New Zealand's.

In the case of Canada the volume of trade is more substantial: it is about 16 per cent. of their exports to the United Kingdom and 2 per cent. of their total exports. This is dealing purely with the section I was talking about in my statement, but those are the figures as they affect the Commonwealth countries.


My Lords, may I ask the noble Earl whether in regard to the horticultural products which are to be looked at by the Deputies there will be a report to Parliament before any final, unalterable decisions are taken? I am sure the noble Earl is aware that at the moment we have power to impose duties up to 100 per cent. on horticultural products from certain countries which produce them more readily because of climatic conditions; and there are, of course, seasonal arrangements where imports are reduced to x per cent. Will a report be supplied to Parliament before any final decisions are taken on the decisions, if any, that are made by the Deputies now looking at these problems?


My Lords, in regard to any particular section of the negotiations and, indeed, on the negotiations as a whole, it must be for the British Government to decide what they think is a tolerable arrangement. As I said earlier, both Houses of Parliament will, of course, be able to make a judgment on this when the balance is complete and the scheme is complete; but it would be very misleading to make a judgment on an agreement reached on one section or another section. We really must see the picture, as a whole, before Parliament can judge whether it is to be accepted or rejected


My Lords, on the point of horticultural products, could the noble Earl tell us whether the Deputies will be discussing the position of horticultural products in the Channel Islands or in Malta? Will there be a different method applied to the Channel Islands? I suppose it is part of the United Kingdom, and that may be so. But what of Malta, and even some other places fairly close in the somewhat less temperate zone?


My Lords, I can assure the noble Viscount that every conceivable aspect of this has been thought about and considered and will be covered in the negotiations. I think I can say that with my hand on my heart about all these problems. I do not believe we have ever taken so much trouble about anything as we have about this, and we have never had such a high-powered lot of civil servants dealing with a problem at deputy level as we have in Brussels now.


My Lords, I will leave it at this: that I am still as unhappy about it as I was on the last occasion.


My Lords, I hope that from now on the noble Viscount will get happier and happier.