UNITED KINGDOM AND THE EUROPEAN COMMUNITIES

HL Deb 26 July 1971 vol 323 cc14-175

2.57 p.m.

THE SECRETARY OF STATE FOR DEFENCE (LORD CARRINGTON)

My Lords, on behalf of my noble friend the Leader of the House, I beg to move, That this House takes note of the White Paper, The United Kingdom and the European Communities (Cmnd. 4715).

My Lords, I must confess to approaching this debate with some trepidation. In recent weeks we have been deluged with speeches, information, confrontations, interviews and soliloquies about the Common Market, and it occurred to me, when trying to think of what to say this afternoon, that there can be nothing new to say, no point which has not been mentioned many times, no argument which has not been aired and no elegant phrase which I can construct which has not been used countless times before. The fact that 110 of your Lordships have decided to speak in these next three days only shows that I am almost alone in holding this view. If I can promise nothing else I promise that I shall discuss policies and not personalities, and that I shall be brief.

For ten years we have been seeking to enter Europe, and in those ten years many of us on both sides of the House have made speeches about successive applications and successive failures. Long before that, some noble Lords on both sides of the House were advocating our joining a European Community—prophets at that time, if not exactly crying in the wilderness, at least operating in very arid country. It seems to me that they have every right this July to look back upon what they were saying twenty years ago with the satisfaction of having been wiser and more far-seeing than their contemporaries.

My Lords, I know that there are many people in this country and in another place, but not, I think, so many in this House, who are irrevocably opposed to Britain going into the Common Market, regardless of the circumstances. They believe it to be contrary to the best interests of the country. There are others who would be prepared to go in if they thought it possible to accept the terms which were to be or have been negotiated. I respect these points of view provided that they are come by, as I am sure they are, with a deep sense of responsibility for the future well-being and welfare of this country and its people.

I do not suppose that in anything I may say I shall influence one single Member of your Lordships, and certainly no one outside, but I must declare myself, as I have on many occasions before, to be one of those who feel that the future of this country is inevitably bound up in an association with Europe; that it should be and that for it to be so is a wholly good thing, both for Europe and ourselves. Until recently I have always had to qualify that sentiment by saying that it depended upon the terms. I do not any longer feel that that is so. I am completely convinced that the terms which have been negotiated are acceptable, and indeed that they are just the sort of terms, and in some respects better, than had previously been envisaged. My Lords, I suppose that compared with those wise men who have for so long supported a European association I am a fairly recent convert. In common perhaps with all of my generation, and with most of your Lordships, I was brought up at a time when a very large part of the world was controlled by the British. We had a military and political power which, if not dominant, as perhaps it was for a short period at the end of the 19th century, was certainly as great if not greater than that of any other single country. And in passing I may say that I do not think that we did all that badly, either for our colonial territories or in keeping the peace of the world. We entered the Second World War, though not in such a dominant position, as one of the very big Powers.

For two years after Dunkirk we were left alone, and subsequently with the Americans and the Russians we won the war. Europe was devastated and remained so until it revived with the help of Marshall Aid and the skill and inventiveness of the people who live there. I confess that I was not wise enough, or perhaps not old enough, in those days to realise that though it appeared that we were one of the great Powers that had triumphed and had won the war, the situation in reality was very different. We won, but at a great cost. As a result of the Second World War and the rise of nationalism our colonial empire disappeared.

With the incredible rapidity of advancing technology, only countries with a big industrial base could enter into all the various activities which make up our modern world and we did not have the resources necessary. With hindsight, I suppose, these things are obvious, but at that time it seemed unthinkable, and indeed I do not believe that it would have been possible in the state of public opinion at that time that we should ally ourselves in the sense that we are now speaking of with our defeated enemies or indeed our defeated friends in Europe. They appeared to have little to offer, neither prosperity nor stability, and the scars of the war years had yet to heal. But as the years went on, it became clear, at any rate to me, that this indeed was the right thing to do, and the right thing to do on two different levels: on a national and international level, and on a purely materialistic level. All politicians, of whatever Party, are in politics, or at any rate should be in politics, for the purpose of improving the lot of their fellow countrymen, to raise their standard of living, and to make it possible for the mass of the people in the country to enjoy a fuller and more agreeable standard of life. There seems to me no other honourable purpose. Of course we disagree with each other as to how that should be achieved, and dispute vigorously as to the futility and emptiness of our opponents' policies. But at any rate in our fairer moments we do not impugn their motives. My Lords, I have always felt that it was primarily for this reason, as well as for the other one to which I shall come later, for the future material prosperity of the British people, that both major Parties, all three Parties, decided to make application to join the Common Market.

Before the war there was hardly any branch of industry or technology in which we in this country were not in the forefront. Certainly in aerodynamics, certainly in electronics—so far as they existed—and in the new technologies, as they were then, we were as advanced, if not more so, than anyone else. To-day in certain areas we can fairly claim that we are with the leaders, or perhaps in some cases ahead of them, but this is certainly not true taking the whole range of technology, and it cannot be true because we do not have the resources, either financial or human, to do everything. We are hardly in the space business—I do not mean space travel so much as the technology of satellites and communications and the like from which a great many important things are developing, and increasingly will develop. In other fields we are finding it increasingly difficult to find the men and money for research and development, so increasingly important and increasingly expensive. If we go it alone I do not think that we can expect to maintain the level of comparability which we have to-day. We shall become increasingly dependent for advanced technology on the big industrial complexes in the United States and, I believe, in Europe. This is not because we lack inventiveness and skill. We do not. It is purely a question of size.

Entry into Europe would give us the opportunity, with our European friends, in an economic bloc of sufficient size, to compete on terms with the other great Powers, and give the opportunity to British industry, British scientists and technicians, to play a proper part in the new Europe. Of course I understand that size is not everything and that the undoubted success of the Common Market in the last ten years has not been primarily for that reason. But success there has been, and the success has been because of the economic collaboration and the impetus which membership of the E.E.C. has given to our friends across the Channel, and as time goes on that collaboration will bear more and more fruit.

Over and over again in these last years we have heard quoted the figures of the standard of living in Western Europe from 1958 to now, as compared with ours, and to our disadvantage. I cannot believe that this is accidental or that our access to Europe will not have the same effect upon us, on our industry and our material prosperity. Certainly the opportunity is there, and it has been heartening to me, and I am sure the same applies to your Lordships, to read of the confidence expressed by British industry in their ability not only to compete but to take advantage of the wider markets available—of the industrialists who signed a letter to The Times the other day, of all the top industrialists who took a full page advertisement in The Times this morning, of the noble Lord, Lord Stokes, who himself took a full page advertisement in all the British newspapers and in all the Common Market newspapers to proclaim and register his faith in his company's ability to succeed.

Of course there are compensating disadvantages which the Government have not sought to disguise in the White Paper before your Lordships this afternoon. The price of food will rise—though not by a very large amount, and nothing like so much as was feared some years ago. Nor does it appear that the effect on our balance of payments will be as serious as at one time was thought. No doubt some industries will have more difficulty than others, but both industrially and financially—for I believe that there is great scope for the City of London in all this—we shall find that the opportunities far outweigh the disadvantages.

Of course, material prosperity is not everything. As honourable men we could not countenance joining Europe on terms which made the economic position in New Zealand insupportable. Nor could we disregard the obligations which we had to our friends in the Commonwealth on sugar. The Chancellor of the Duchy of Lancaster has successfully negotiated on both these points to the satisfaction, as I understand it, both of the Government of New Zealand and of the sugar producers. Of course everybody would like more. Of course one would like to get one's own way about everything. But the terms settled seem to me those which can be accepted by us and they have been accepted by the sugar producers and by our New Zealand friends. The terms are fair for them and fair for us, and he would, I think, be a brave man who would say that he believed that at any time in the last ten years we should have done any better than we have on this occasion.

But I said that there was another level on which the Common Market and our application to join it should be judged. At the time just after the war, and for some years afterwards, it was possible, I suppose, to think of an economic bloc, though not I think of a military bloc, of some similarity to the E.E.C. which would have been formed by the Commonwealth, or at any rate by the larger members of it. It became apparent fairly soon that, though this might be an attractive idea, and certainly one that would appeal to those in your Lordships' House who have lived and spent some time in the Commonwealth, it was becoming increasingly unreal. The developing white Commonwealth was making its own arrangements with its neighbours in economic terms, and the kind of union which we are talking about this afternoon became progressively less possible as the economies of Canada and Australia developed. Nor, I think, would it have been possible to have suggested it, much less to have had such a suggestion accepted by India or Pakistan, or by any of the former African territories. I do not think it would have been welcomed, nor indeed would the economic balance within such a union have proved very easy to achieve.

I have read just recently of some disappointment in Australia about the Government decision to recommend the terms negotiated by Mr. Rippon. I do not know how widespread that disappointment is. I suppose I should declare an interest, in I that, both in family and by long association, I am an Anglo-Australian. But I myself would doubt very much whether, generally speaking, the Australians are much surprised at the decision we have taken, or indeed overly criticise it. They have known for some time that successive Governments have wished to join. In the meantime, their economy has greatly diversified and greatly strengthened. As compared with the problems which our joining presented to New Zealand, the problems presented to Australia were comparatively minor. That is not to say that the Australian pattern of trade will not change as a result of our entry—indeed, it is changing now—and we must acknowledge that it comes at a time when their primary industry is in a difficult state. But, my Lords, the Australians recognise, just as we recognise, that a prosperous Britain, an influential Britain, can be of greater help and a better friend to them than if we were to continue our own rather stagnant economic way.

The other thing I know about Australians is this: that they have a very acute and proper sense of national self-interest, as anybody who has had to bargain with them on a Government-to-Government basis can testify. They have an equal understanding that others also have a national interest. If I felt that what we are proposing to do would damage our relationships with Australia, New Zealand and Canada in such a way as to diminish the very close ties that we have with each other. I think I should be very hesitant to go ahead, for I value those ties as highly as anyone in this House. But I do not believe it to be so.

If it was not possible to enter into a Commonwealth grouping, what then were the alternatives? Certainly not a close association with the United States, for the inequality of our economic situations and our respective sizes would inevitably mean Britain's becoming a very junior partner: and none of us would relish that. What then of Europe? I once ventured to say to your Lordships (and I do not think I was too unkindly contradicted) that almost everything that was any good in the world—whether it be art or poetry, or philosophy or invention, or the science of politics or government—had come from Europe, and almost everything bad as well. From Europe in the past hundreds of years have sprung the seeds of unrest and war, of conquest and cruelty and greed. Surely no collection of people can ever have been so quarrelsome over so long a period as have our near neighbours and we ourselves, culminating in the catastrophes of the First and Second World Wars. And now, because of the vision of a few men, six countries of Western Europe have decided to collaborate together in an economic union, abolishing tariffs and passports and barriers and forswearing the enmity and rivalry which had moved them for so long.

Of course it cannot all disappear in a short time. Of course there will be difficulties in the years ahead. But here is an association between six sovereign countries determined to collaborate one with the other in a new pattern of international friendship. It has always seemed to me one of the most extraordinary paradoxes of the postwar world that, while all the lessons of history and modern technology point to bigger groupings, as the world has got smaller and as life has become more complicated, the tendency has been exactly the reverse: for countries to split up into smaller and smaller units, for tiny islands to become independent, for minorities to seek to declare their independence as economically non-viable States.

Here in the E.E.C., in a very important sense, the reverse is happening, and now there is a possibility that the original Six can be increased to ten, with all the consequent advantages that that will bring to each of the countries concerned. We in Britain, I believe, can add political stability to the partnership of our European friends. We can, I believe, add an outward-looking approach to the Community, for if we just concentrate on getting rich and leave the Third World to become poorer we are only storing trouble ahead. We can bring to the Community our not inconsiderable industrial skills. We can bring with us our long traditions of stable Government and political know-how; not to lose any of them in a bigger Community, but to contribute in a bigger Community to the welfare of all.

My noble and learned friend the Lord Chancellor will, I think, be talking about the various aspects of sovereignty, so I will not touch upon them except to say that those who feel that this issue is vital to them cannot surely have failed to observe that the national institutions of our friends in Europe have no more been watered down or eroded than have their national characteristics. Sometimes we forget that we have for over twenty years been a member of NATO, contributing and assigning forces to that Organisation, and accepting an American as Supreme Commander and, in time of war, having the whole of the British Army of the Rhine placed under the command of a German General. I do not think that as a result there has been any diminution in our independence in foreign or defence affairs.

And as for defence—and your Lordships may expect me to say just a very few words on this subject—I do not accept that our membership of the Community would lead to any dramatic impact or action in that regard. It has been said that there will be immediate repercussions on our nuclear arrangements. That is not so. They will remain exactly as they are now. As your Lordships know, defence is excluded from the Treaty of Rome. The North Atlantic alliance provides the essential background framework for the defence of Europe. It may be that the closer association with Europe in a Community of Ten may well lead to closer collaboration, but it would seem at any rate in the foreseeable future to be related more to collaboration on arms production and rationalisation than anything else. I do not believe that, in the future, Europe, or any part of it, should or could seek to acquire a nuclear armoury on the scale which the Russians and the Americans, and no doubt soon the Chinese, find it necessary to maintain. I do not think we would wish to afford it, nor think it appropriate, for certainly it is my hope that Europe will always be allied to the United States for its defence against the Communist world. But we can be powerful economically as well as militarily, and in this way we can exert our influence and pressure in our own interests. In this enlarged Community we should have the opportunity to create a bloc which can by its size and economic strength, not dependent for its technology on anyone, by itself compete on equal terms with the giants.

These, then, are the prizes which are there for us. It will be up to all of us in the next few months to make up our minds whether we wish to take this bold step. We could of course continue as we are, though I have no doubt that comparatively our power, our influence and our standard of life would suffer a gradual but steady decline. I have no doubt where I stand: on the side of those who saw clearly what should happen in those far off days in the late 'forties and early 'fifties. I think they were right, and I think the Government are right; and when the time comes we should take that momentous step and start to write a new and even more successful chapter for the British people. My Lords, I beg to move.

Moved, That this House takes note of the White Paper, The United Kingdom and European Communities (Cmnd. 4715).—(Lord Carrington.)

3.22 p.m.

LORD SHEPHERD

My Lords, the noble Lord, Lord Carrington, said that he rose to speak with a sense of trepidation. I ask the noble Lord to have some sympathy with me, since clearly the noble Lord, Lord Carrington, spoke with deep conviction, whereas I quite genuinely stand in the middle of the road, deeply uncertain, and have yet to make up my mind. The noble Lord referred to an advertisement in, I think, to-day's edition of The Times signed by leading industrialists. I saw an advertisement in the same paper last week signed by many notable sportsmen and entertainers, but I also saw on Saturday morning a letter addressed to the Editor pointing out the fact that Lester Piggott had been omitted but that, so far as the writer was concerned, the advertisement was worthless.

My Lords, early in July there was a real risk that, in the event of Her Majesty's Government being able to put suitable terms before Parliament, Parliament would be asked to approve those terms before the Recess. I think the Government are to be congratulated on the fact that they have resisted that temptation and have adopted the sensible and democratic course of giving adequate time to Parliament and to the country to carefully consider the terms, and during the period of the great debate to make up their minds on an issue which could change the whole course and the character of this nation and, in particular, our relationship with the Commonwealth. The debate we start to-day in your Lordships' House is part of that national debate, and I should like immediately to express our appreciation to the noble Earl the Leader of the House for the arrangements that have been made for this debate. The fact that three whole days could be set aside at a very difficult period of our Parliamentary Session is indicative of the noble Earl's desire to meet the wishes of the House and of the importance of the occasion, and I think we can rest assured that in October, when we are called upon to make the momentous decision, the noble Earl will have very much in mind the wishes of this House. The noble Earl could of course help the House immensely if, before we rose for the Recess, he were in a position to announce the dates of the debate and, in particular, the date on which the decision will be made.

As I have said, we regard this debate as part of the great national debate. So how should we approach our discussions? In a few moments I shall seek to remind the House of the official position of my Party, both in Government and in Opposition, towards our possible entry into the E.E.C. To-day, my Party, like the Party opposite, is divided. This is not surprising, since the nation as a whole is divided. Not only is it divided, but, in the main, there is deep confusion as to what is involved. Those of us who have served in public life are are only too well aware of the deep and sincere views, of very many years' standing, that are held by friends and colleagues on the issue of Britain joining the E.E.C. This conflict of view existed long before the question of terms arose; but with the passage of time and with the approach of the moment of decision those deeply and sincerely held views have sharpened and hardened. I have always respected those views, but I am bound to say that, with the passage of time and with the sharpening and hardening of them, they have to me become more open to the criticism of over-statement and exaggeration. I believe that the advocates on both sides have overstressed the advantages and the disadvantages, and in particular the economic and political disasters if we were to enter or not. I believe that the argument is far more finely balanced than we are led to believe. But these views are held, and if this debate is part of the national debate it is right and proper that they should be expressed.

The Labour Party, in the country and in Parliament, is slowly proceeding through its democratic processes to an assessment of the views of its constituent members. So during to-day and the next two days we on this side of the House shall be speaking for ourselves. There will be no restraints or limitations on any one of our Members, whether he be on the Front Bench or on the Back Benches. But, in view of the fact that some 110 noble Lords wished to speak, my own Front Bench thought it right that there should be some restriction on the number who speak from this Box; therefore my noble friend Lord Shackleton has sought, I hope successfully, to ensure that the right balance of view is put forward from this Bench. I should like to express appreciation to those noble Lords who sit on our Front Bench, and who hold very deep convictions one way or the other, who have agreed not to speak.

There seem to me to be two issues in this debate. First, is there a real case on political or economic grounds for Britain's joining the E.E.C.? Secondly, are the terms negotiated by Her Majesty's Government good enough for this country, for our EFTA partners and for our friends and allies within the Commonwealth? I think it would be fair to say that, on balance, the Conservative and Labour Parties, in office and in Opposition, believed and believe that for political and economic reasons Britain should enter the E.E.C. I said deliberately"on balance ", for there are some within our Parties who accept the economic case but are deeply concerned about the political consequences, and there are others who support the political arguments but express doubts on the economic question. There are some who agreed, with the greatest of reluctance, that negotiations should be started, perhaps in the belief that the approach would again fail and that suitable terms might not emerge. I think it is also right to say that at the last General Election the Conservative Party as well as the Labour Party sought no mandate from the electorate on the question of entry. The Prime Minister could not have been more explicit when he said on behalf of his Party,"Our sole commitment is to negotiate; no more, no less."

My Lords, I think it is right at the outset of this debate for me to state what is the official position, as of now, of my Party and what it was at the last General Election. We said this in our Party Manifesto: We have applied for membership of the European Economic Community and negotiations are due to start in a few weeks' time. These will be pressed with determination for the purpose of joining an enlarged Community provided that British and essential Commonwealth interests can be safeguarded. There is a clear commitment for entering into the E.E.C. provided the terms were satisfactory. The important words in regard to the terms are these: Unlike the Conservatives, a Labour Government will not be prepared to pay part of the price of entry in advance of entry and irrespective of entry by accepting the policies on which the Conservative Party are insisting for levies on food, the scrapping of our food subsidies and the introduction of the value added tax. These three provisos which we put into our Manifesto are clearly part and parcel of the terms which the Government themselves are prepared to put before Parliament—and let us be quite clear, the position of my Party at the General Election was that these three aspects of the terms were not acceptable.

I should now like to turn to the political question, since the problems of entry have a direct bearing on the economic question. While it is true that the E.E.C. has concentrated on economic and trading matters, the long-term intention of the Treaty of Rome is to create some form of political unity. There is no doubt, whether we enter or not, that Europe intends to proceed in a great new move forward to political unity. Speaking for myself, I am deeply convinced that such a move is essential and that only good can flow from it. As one who has been deeply committed to the concept of collective security and who has always been a strong supporter of NATO, I believe that it is impossible to be otherwise. But I should like to make clear that NATO must remain the instrument of defence; and since NATO is ill-equipped, and by its membership unsuited to represent the European point of view, it should not be involved in any negotiations with the Soviets and their allies. May I also say that I do not believe that NATO policy or matters connected with nuclear weapons should play any part in the moves to create a political unity? I was grateful for the assurances of the noble Lord, Lord Carrington, on this aspect.

I have an open mind about how quickly and in what form the political institutions should be set up, but I believe that through an enlarged Community we shall be able to devise ways and means of reaching a consensus view which can have a real influence on the major issues in Europe and well beyond. The Prime Minister spoke some two weeks ago about his vision of Europe. My vision is a different one. I have a vision of a united Europe embracing East and West, a Europe deeply involved with the settlement of world problems and united in solving the economic and social problems of the undeveloped world in partnership. Some may say that this is a pipe-dream; certainly it may appear unobtainable in the near future. But I believe that it would be wrong to appear content with an enlarged Community, leaving the remainder divided and fragmented.

I have no doubt that the E.E.C., now clearly an interim arrangement, is beset by its weaknesses and national interests. An enlarged Community will be a very different organisation. In all its aspects, it will become more self-sufficient and, correspondingly, there is a real risk that it could become inward-looking. We have no reason to believe that now; but there is no doubt that there is an air of protectionism spreading throughout the world, and particularly in the United States. This, in my view, would be a real tragedy. I would hope that future Governments of the United Kingdom will seek to move the enlarged Community towards progressive measures towards disarmament, détente, co-operative action overseas and a liberalisation of world trade. Having this doubt, but recognising the extent to which the E.E.C. countries participate in overseas aid as indicative of their desire to participate in affairs outside and be yond Europe; given the fact that there will be some form of political unity in Europe; and given the fact that in isolation, as a middle Power progressively losing influence to the super-Powers, and later I believe to the E.E.C. if we fail to enter, and to Japan, I have no doubt that on the political argument we should enter the E.E.C.

My Lords, one could dwell much longer and in more detail on the political question, but in order to keep this speech as reasonably short as possible, I will leave it now and move to other aspects. If you are a passionate supporter of entry, providing the terms are not harsh to the point of being intolerable, I think you will have no difficulty in accepting the terms that have been negotiated. If you are opposed to entry on principle, then the question of terms hardly arises. As I say, for myself in the middle ground, the terms present some real difficulties. The Labour Government laid down four principal conditions: first, the terms affecting the balance of payments; secondly, the question of capital movements; third, guarantees to the sugar producers; and, fourth, long-term trade with New Zealand. So far as the last two conditions are concerned, Her Majesty's Government have obtained, on the face of it, what appear to be satisfactory agreements, sufficiently satisfactory for no Commonwealth Government publicly to criticise them.

I think it will be agreed that an offer to New Zealand of safeguards phrased like the safeguards offered to the sugar producers would not have been acceptable to our Parliament or to New Zealand. It was undoubtedly clever strategy to leave New Zealand to the last; and to obtain a more closely worded and specific commitment than was possible for the sugar producers. Of course we should all have liked an agreement that left our long-term arrangement with New Zealand unaffected; but perhaps that is asking too much. New Zealand trade is changing; new markets are opening up and will continue to develop. Dependence upon the United Kingdom market is less to-day that it was 10 years ago, and will continue to become less whether we enter the E.E.C. or not. The Government of New Zealand were at all times closely involved in the negotiations and have accepted the arrangements. They, in the end, are answerable to the New Zealand electorate. However, I think that the speech of the President of France, M. Pompidou, to the French farmers did not help matters. It raised considerable doubts in the minds of the New Zealanders.

My Lords, so far as those terms are concerned, I think it is difficult to question them. One could say that they are reasonably acceptable. I wish I could say with equal confidence that this was true of the sugar agreements. The words of the arrangement appear satisfactory; but they depend upon a determined Government in the United Kingdom to ensure that the spirit is made reality. Cane sugar is slightly more expensive than beet sugar and, through the Commonwealth Sugar Agreement, we have given overseas aid by deliberately buying cane sugar at higher prices than beet, and in consequence we have restricted production of beet growing in this country.

My Lords, the farming lobby is a strong one and one must anticipate continuing pressures for increased acreage and increased refining, but in the end the arrangement depends on adequate cane sugar refining capability in the United Kingdom and willingness to pay more for the new material. Will Her Majesty's Government give an assurance that they will ensure adequate cane sugar refining capacity remaining available in this country, and can they give an indication of how this will be provided? To what extent this arrangement is bankable, in the sense that growers overseas will continue to get bank loans overseas for the estates, is questionable, bearing in mind the long period of investment involved. Here again, I wonder whether the Government can help us. Provided the Government give firm guarantees to the sugar producers and assure adequate refining capacity, to me the arrangements appear satisfactory, but without these particular guarantees I must say that in the long term the arrangement may well prove worthless.

The noble Lord, Lord Carrington, spoke about Australia. It is true that Australia is in a different position from the other sugar producing countries and New Zealand; but there are some 9,000 farmers in Australia, and clearly in Queensland there will be great difficulties. There may be special troubles involved if that sugar is put on to the world market. I wonder whether the noble Marquess, Lord Lothian, or whichever Minister winds up the debate, can say what assistance can be given to the international sugar organisation to remove what could be a serious impact on sugar which is in big supply?

My Lords, I have tried to give a fair assessment of the terms negotiated to meet our obligations towards those in the Commonwealth. I now turn to that part of the negotiations about which most people feel very uneasy, with complete justification. I refer to the economic and industrial questions. What are we presented with? On the one hand, it is claimed that our long period of economic difficulties and declining fortune will be over and that within the enlarged Community we shall never again need to worry about balance of payments difficulties, that there will be higher wages and longer holidays and a bigger selection of goods to buy. On the other hand, we are told that there will be dire consequences if we enter. It is claimed that soaring food prices and rising industrial costs will cripple our competitive position, that we shall lose out in the United States and within the Commonwealth and that in the end we shall turn up among the poor and neglected relations of Europe. This sort of generalisation is in my view unworthy of the real case that can be made for or against. But how can we assess the advantages or disadvantages of entry when we are overwhelmed by conflicting statistics and figures?

The White Paper of 1970 was rightly criticised because the variations given were so great that the Paper was next to worthless. The present White Paper avoids that criticism by providing scant information. If we take the figure for balance of payments in the White Paper of 1970 we find that the Labour Government, using the same base figures, and no doubt the same statisticians, hazarded a guess over a very wide range. The present White Paper suggests some £200 million by 1977. Shortly after that publication, we had reports in the Press that the figure was really £500 million. Is there any point in pressing the Government on this matter? I suspect not, for I do not think anyone really knows. Reliable forecasts are impossible, for this will depend on how quickly British industry responds to the opportunities. It will depend also on the movement of world prices and whether the gap between world prices and those within the E.E.C. continues to narrow.

The size of the budget is important and is clearly imponderable. Her Majesty's Government cannot say with any certainty whether the budget will grow further or decline. If one hazarded a guess one would say that the budget will increase. Anyone seeking a judgment on any of the figures given should, I suggest, treat them with the utmost reserve. In making a judgment one must recognise the very strong and conflicting counter-balancing considerations, and the trouble is that these considerations are all imponderables. No one will dispute that trade barriers hinder trade, restrict investment and prevent growth. An advanced industrial country like the United Kingdom requires a large and open market and a large Community of 290 million people enjoying an advanced industrial and social standard is clearly very attractive.

Those who support entry point to the dynamic effect on our whole economy if we enter the E.E.C. It is impossible to quantify that dynamic effect. Much will depend on how we adjust during the transitional period of five years. But those who oppose entry can still with some justification ask why should there be such a change in our fortunes in joining a market of 290 million people when we have apparently failed in a free trade area of 100 million. The answer here is that, apart from size and the possible inclusion of a rich and industrially powerful country like Germany, the E.E.C. is a very different organisation from the free trade area. The E.E.C. has adopted coordinated policies and Member States are required to adhere to them. To some extent there is a loss of sovereignty or restriction of Parliamentary power. But I think it is also fair to point out that even if we remain outside the E.E.C.—and certainly over past years this has been the case—there will be some restriction on Parliamentary sovereignty.

But, my Lords, I accept that in a dire national crisis Member States may react contrary to regulations, as the French did when they devalued twice and Germany did when she revalued the mark. But clearly this must be an exceptional circumstance. In past debates we have spoken of the need for more industrial development, regional development and the growing need for investment. I was most impressed by the figures given by Mr. Jenkins concerning export costs and prices and home prices within the E.E.C. which have all fallen since 1960–61, whereas ours have risen. I thought this a very important point, but then I read in Saturday's newspaper a letter from Mr. Enoch Powell which challenged this view and showed figures which were even better of countries which were outside the E.E.C.

Be that as it may, it must remain clear that if we remain outside our existing export markets could be eroded progressively. We shall require all the investment we can lay our hands on in the transitional period and beyond, but I have real doubts about the period agreed for the freeing of capital movement. Capital investment in industrial production, like all investment, is attracted by profit. I strongly suspect that in the next few years industrial profitability is unlikely to rise but is more likely to fall whether we enter the E.E.C. or not. If we free capital movements too soon that may well lead to a drift of United Kingdom capital to more profitable enterprises in the E.E.C., with a subsequent loss of employment and a further weakening of our own economy. It may lead us to continue our present rates of interest which, in all conscience, to-day are too high.

We on this side of the House attach very great importance to regional development and the need for special measures to encourage industry in the regions. I note that in the E.E.C. there is no specific policy towards regional development. I hope that the Government will be able to make a full statement on this matter during the debate. We have very special problems here, and I believe that special arrangements will have to be made. I think it is certainly true that by October we shall need a full statement on fisheries; and we should expect an agreement to be reached before Parliament is called upon to make a decision.

There is one aspect of economic and regional policy which has not yet been mentioned, so far as I know, in any of our debates. It is easy to talk about increased production and larger sales in Europe. Transport and handling costs are to-day a major factor in our export prices. Our ports and roads are inadequate for even the present flow of trade. Costs are very high, and there are big delays. Have the Government any new policy in regard to port development, particularly on the East Coast? And have the Government anything further to say about the Channel Tunnel? It may be that the Chancellor of the Exchequer when he speaks in another place to-day, will make a statement on the whole question of sterling. Most of us will look forward to the day when this country will not be called upon to support a reserve currency and we are free from the present severe restrictions. Sterling holders need to be protected, but it is vital that there should be no fixed or harsh repayment programme. I wonder, again, whether the Government can let us know what thoughts they have on this subject.

Speaking of safeguards, my Lords, the White Paper gives assurances about pensioners and those who are on State benefits. There are many who are on the borderline, and particularly those on fixed incomes, for whom the impact of higher food prices and the consequences of a value-added tax will be most severe. We shall need great flexibility in our treatment of these people. Can the Government give us any information about their present thinking in this matter? There are many other matters that one could raise on the economic aspect of entry, and no doubt they will be raised in the course of the debate.

As one who has not the comfort of deep conviction either way on this question and who, when the decision has to be taken, will have to act perhaps more on faith and hope than anything else, it seems to me that one thing is clear: that the great new future that is claimed will be opened out before us if we enter will not come about through an accident or by infection. The problems of balance of payments and unemployment, and the inequalities that exist within our nation, will not disappear overnight. Entry into the E.E.C. will not solve these problems, but may well aggravate them unless Her Majesty's Government commit themselves to policies which will provide sustained growth in the economy; policies which make it possible for all sides of industry to co-operate in greater efficiency and higher productivity; and, equally important, policies which more equitably distribute the benefits of our labours and endeavours. Here the Parties are divided. We on this side of the House, whatever may be our views on the issue before us, lack confidence in Her Majesty's Government so to order our affairs that we shall be able to respond to the undoubted challenges and opportunities of the wider Community.

My Lords, if I were called upon to express a view on the terms negotiated, it would be as follows. Taken as a whole, they are not harsh or intolerable; but, on the other hand, they are far from generous. One would have thought that there would have been a greater recognition of our material and financial burdens and of all we have done to sustain defence in Europe. It seems to me that there is another question to be asked. Can we afford these terms in our present economic position? It is the misfortune of this country that we are called upon to make a decision during a period of economic stagnation bordering on depression; when unemployment stands at the highest figure for some 31 years; when there is a real possibility, as a consequence of the Industrial Relations Bill, of industrial unrest, such as we have not seen for many years; when investment remains at a low level; and during a period when research, both private and public, continues to be cut back.

These terms would be bearable if, when we enter, the economy was buoyant and confident. But what confidence can we have when we look at the present policies? It is claimed that the Chancellor's actions last week will boost the economy and provide us with a sustained growth. The Prime Minister is confident; but I do not find this confidence in industry to-day. The present view of the measures announced last week is that they were too much, and certainly too late. If we get the anticipated boom, is there any reason why we should not get the traditional balance-of-payments difficulties in 1973, perhaps with the traditional deflationary policies, just when we are about to enter? I feel bound to say that I have a deep sense of foreboding about the condition of our economy when we enter, and that the impact of our entry will be grave indeed.

My Lords, I would support our entry, and would accept the terms negotiated, provided that there could be confidence in the adoption of policies that brought about sustained growth based upon the export-orientated sections of our industry, and policies that brought about co-operation throughout the nation. But, for myself, that confidence does not exist, and certainly I shall need to wait until October to know what I shall do when the Division is called.

3.57 p.m.

LORD GLADWYN

My Lords, I suppose that in simply"taking note"of this White Paper we are nevertheless expected to stand up and be counted, in the sense of saying clearly whether we approve of its proposals or not. Speaking on behalf of the Liberal Party, I need hardly say that we do. Though we have a few dissentients, the party as a whole has never wavered on the question of principle. As in other instances, it was years ahead of the other Parties in accepting that principle. And for a long time it has also recommended the sort of terms for our entry that have now been more or less agreed.

Since it seems to be in order to say a word about one's personal attitude on this matter, perhaps I may say that, so far as I am concerned, I was not actually what is called a"European of the first hour ", of whom there are happily some representatives in this House. No doubt therefore the collective wisdom of the Party which I have the honour to represent was originally superior to my own: I would not dispute that. During the war, and after it, it is true that I was strongly in favour of some close association of all the Western European democracies; though I was at the time, quite frankly, opposed to some of the conclusions of the famous Hague Conference of 1947. I was opposed because I did not think that the type of federal solution there proposed was then practical politics. Besides, it was always completely unclear to me whether the intention was that Britain should actually form part of such a federation or not.

But it is also true that ever since the coming into force of the Treaty of Rome at the end of 1957 I have consistently said that we should inevitably one day have to join the European Economic Community, if we could. Since then, two British Governments of quite different political convictions have come to the same conclusion. Twice an attempt to join was simply vetoed by General de Gaulle, who was a great one, as we know, for trying to arrest, if not indeed to reverse, what most informed people might conclude was a logical and historical process.

My Lords, these vetoes did great harm, partly because they actually held up the development of the E.E.C. itself; partly because they resulted in the Six adopting a Common Agricultural Policy without what might be called the"advice and consent"of the other Western European democracies, in particular our own; and chiefly, perhaps, because they cast our own proud nation in the role of a sort of rejected supplicant. Even now it is not absolutely certain that we shall not on the rebound reject the Community and try to pull ourselves up with our own boot straps, in accordance with the pure milk of nationalist doctrine. Nationalism is one of the strongest instincts—only rivalled, perhaps, by aggressiveness or sex. But all are instincts which, however natural in themselves, must be directed into constructive channels if our civilisation is to survive in a very dangerous age. In France extreme nationalism, in the shape of the Right Wing Gaullists, nevertheless persists. In Britain, the exact analogue of these Gaullists is the anti-Common Marketeer.

Happily, as we all know, there is now a new spirit abroad on the other side of the Channel, and in spite of the now outdated and increasingly unconvincing activities of our own nationalists, there seems to be a growing feeling in Britain that isolationism in the modern age makes absolutely no sense. I must say that for the last 14 years or so it has made absolutely no sense to me. Ever since 1957, I have repeated that if we did not join the European Economic Community—provided always that it did not break up—we should become more and more isolated and thus in a world of super-States or potentially super-States increasingly second-rate. The Free Trade Association of the Seven, which only gave us an additional home market of some 40 million or so, was not designed to last and had no political content. The Commonwealth was, economically speaking, obviously a wasting asset. Union with America was out of the question; undue dependence on her would turn us into a simple satellite. Therefore, as it seemed to me, the longer we stood outside the European Economic Community, the more probable a decline in our standard of living as compared with those nations inside the Community, the more frequent our periodic"stop-go"crises, and the more likely that we should in the long run have to support a large number of unemployed if we were to avoid some disastrous inflation.

Although, naturally, a number of economists can be found to dispute some or all of these contentions—after all, it is always possible to find economists to contest any contention—the fact obvious to all but the blind, is that all these chickens have now come home to roost. Since 1958, in fact, British Governments of varying political complexion have all struggled with an economic situation which was bound, as I believe, to get gradually worse, whatever domestic policies were pursued by whatever Party. It is not, therefore, so much our politicians who have been to blame; it is surely something vicious in the whole post-war system. Take France and Italy, for example; both had empires before the war. Italy was deprived of hers, that of France were slowly liquidated after the war, and it is greatly to de Gaulle's credit that he in no way prevented—indeed, he actually encouraged—that process. But neither country then tried to support a world currency and behave as a world Power, although it is true that France pretended to do so under General de Gaulle. They joined the European Economic Community and in so doing harnessed themselves to a great coordinated Western European effort, largely dependent, of course, on the vast economic potential of Western Germany. As a result—or at least partly as a result—the French, with 12 per cent. fewer people, are now superior to us, even if slightly superior, in all relevant economic respects: gross national product, real wages, standard of living, full employment, social benefits—or most of them pensions, holidays, aid to underdeveloped countries, anything one likes to mention. Even Italy is rapidly catching up, in spite of the huge historical burden of the Mezzoqiorno, and Germany of course is far ahead. If France and even Italy could do all that, why could not we? The answer is perhaps that the British people have not even now realised that nobody owes them a living, and if they want to preserve their standard of living they simply must abandon their illusions and old-fashioned industrial practices and move with the times.

But it is not only our standard of living that is now in question, unless we turn over a new leaf. It is, quite possibly, our whole way of life. All over the world free societies—that is to say, countries in which expression of opinion is free and the people are entitled to elect their own representatives in Parliament freely—are in danger. Outside Western Europe not a great many genuine democracies survive. If a country's economic situation deterioates to a certain point for a certain period, there is considerable reason to suppose that some"strong"Government will take over. It could be of the Left or of the Right. But the appeal will be undoubtedly to the nationalist sentiment, as in war time, and the essential feature will be that everybody will just be told what he has got to do.

What reason is there for thinking that our own economic situation will not continue to deteriorate, relatively at any rate, if we fail to get into the Common Market? The present Tory deflationary policy—now, as I understand, temporarily discontinued—may succeed in the short run, as we must all hope that it will. But failing some major change in, so to speak, the structure of our society, I am afraid that it is only too likely that improvement will be followed by further stagnation—in fact, the old phenomenon of"stop-go ". The need to protect the pound, the insufficient rate of growth, the burden of the sterling balances, all these things will still be with us and there is absolutely no reason to suppose that, confronted with a grim reality, a Labour Government would be any better qualified to cope with them than the Tories—unless, as I say, under the influence of the so-called"Left ", they had recourse to the rather desperate alternative of a directed socialist economy.

So we come to the prospects of a real recovery if we do succeed in entering the Community, and this admittedly depends—I do not blink this fact at all—to a considerable extent on the terms for entry which have now been largely agreed. There is no need for us to dwell on the conditions affecting New Zealand and other members of the Commonwealth. They have been accepted by all those concerned with the exception of Australia, whose Government is any case has not formally protested, as I understand it, and whose general attitude towards this country has been rather well described recently by no less a person than Mr. Roy Jenkins. It is evident to all that they would also have been accepted with enthusiasm by a Labour Government and it is best, at any rate in this House, to draw a polite veil over the utterances of all those who suggest the contrary.

What may in the event prove unduly burdensome, of course, is our necessary acceptance of the Common Agricultural Policy of the Six and all that that entails in the way of possible loss of certain markets, dearer food and a very considerable subscription to the Central Agricultural Fund. But here we must also remember, as the noble Lord, Lord George-Brown, and many others have told us, that Mr. Wilson's Government were prepared to negotiate on the basis of acceptance, in principle, of the Common Agricultural Policy; so it can hardly be denied that they too were willing to accept any unfavourable consequences indirectly arising therefrom, in return for the long-term benefits which were also confidently expected. Nor can it reasonably be maintained that they would have succeeded in getting the Six to agree to a smaller subscription to the Fund and one more spread out in time than that just negotiated by Mr. Rippon.

Whether the net result will be an intolerable burden on our balance of payments is something that no one can possibly say—and here I would follow the sentiments just expressed by the noble Lord, Lord Shepherd—because, after all, it depends on a number of quite unknown and unpredictable factors, such as changes in the world prices of foodstuffs; the terms of trade generally; the possibility or otherwise of a recession or increased protectionism in the United States of America; the extent to which our own farmers may increase their production; and, above all, as I think the noble Lord, Lord Shepherd, also said, on the extent of the fillip to our national productivity which will be given by joining.

The fact is that if things go well, the burden on our balance of payments will not be noticed. If they go wrong, we shall just have to concoct remedial measures with our partners, as the French did when things went wrong for them in 1968. What I say—and this is one of my chief points—is that it would be far better for us, if things go wrong, to negotiate inside a great Community of which we shall be a leading partner than it would be if our rather isolated economy once more gets into rather a sad mess and we are again at the mercy of the International Monetary Fund. In other words, the whole operation, as I see it, is economically speaking a dash for freedom; and this is where Mr. Douglas Jay's statistics fail to impress. He has compiled a formidable dossier of figures—some of us may think that they are unnecessarily inflated figures—showing that we shall be bankrupted if we join the Community on the present terms and things go wrong. But he completely ignores the figures indicating that we are likely to become an increasingly down-at-heel offshore island if we do not join, irrespective, I fear, of whether outside factors are favourable, as they often have been in the past, or the reverse. All the probabilities are, indeed, that in the course of our dash we shall not be shot down by Mr. Jay's statistical machine gun, given only that we pull ourselves together, work hard and make use of the great new opportunities which will certainly be afforded us.

But, my Lords, if we are to gain anything very much from our dash for freedom there is one aspect that we should consider very carefully before we jump over the barbed wire. For the whole new extended Community just cannot develop its huge potential—that is to say, it cannot unleash the great power at its disposal—unless it so organises itself as to permit some decisions to be rapidly taken in the interests of the group as a whole. And if it is to do this it must employ certain supra-national techniques. There is no other way, and I think the Liberal Party has been consistent in so maintaining. It is no use pretending that the Community can work satisfactorily—if indeed it can work at all—if every member in all respects preserves absolute freedom of action. It is dishonest to suggest it. In other words, there must be a Commission which is permitted to function, broadly speaking, in the way laid down by the Treaty of Rome. There must be a Parliament which is awarded greater power over the Community budget than which it now possesses; and, above all, there must be acceptance in principle—and I say only in principle—of weighted majority voting in the Council of Ministers in certain well-defined, though limited, spheres. Those are the essentials.

None of these things means that we shall be entering a federation in the usually accepted meaning of the word. It simply means that our ancient nation States, while preserving their identity, their traditions, their political institutions and separate ways of life, must agree to take certain decisions in common in accordance with a recognised democratic procedure. If they do not, it is not a Community that we shall be joining, but a Customs Union. On the whole, it would probably be better to be inside this Customs Union than outside it, but it is quite unlikely that entry into such a Customs Union only would give the necessary fillip to our ailing economy. We shall, we know, be starting off on the basis of the famous"Luxembourg compromise ", but once we are in it must be in our own interests to do our best to see that this is modified in the right direction by common consent.

It is not only in the economic sphere that we shall have to be thinking about new techniques regarding creating a real economic European unity. I know that when one speaks of defence in connection with Europe it is, as it were, anathema to some members of the Labour Party, including perhaps, judging from his recent remarks, its Leader. But we really should not bury our heads in the sand. Defence is not only a question of NATO, though it is of course chiefly a question of NATO. It is also a question of a United Europe, and so it is a question of the defence of the European Community; and one of the first problems with which we shall be faced when—because I think I really can now say"when"and not"if "— we join the E.E.C., is how the extended Community should as a body react to the obvious intention of the Americans to reduce their forces in Europe over the next few years, perhaps in the light of some bilateral deal with the Russians on SALT or strategic arms limitation, but quite possibly in the absence of such a deal.

Unless we simply want to throw in our hand, in which case we shall be at the mercy of the Russians, we shall have to work out and then agree with the Americans within the sphere of the Alliance a common policy on the"conventional"defence of Western Europe and improve our machinery for arriving also at a common foreign policy, noticeably over such areas as the Middle East. To the embattled members of the British anti-Common Market Left, a bald statement of this sort is a kind of abomination, as I understand it—pure cold war. As they would say, why not disarm, withdraw from Europe and let our great neighbour in the East extend his brotherly influence over neighbouring States in accordance with the socialist doctrine of Brezhnev? Why not break with the Americans and accept the so-called"Finlandisation"of Europe? It is not members of the Labour Party sitting here on the Front Benches who hold those views, but they are certainly held in Left Wing socialist circles.

My Lords, if we cannot soon work out a new political and defensive system in Western Europe within the framework of the Western Alliance, this may be the sort of fate that will shortly confront us. But the necessary machinery is there, and by adapting and enlarging the present Western European Union structure it would be perfectly possible to transform it into what might be called a political and defence wing of our extended European Economic Community. It is not a question of leaving NATO and setting up a sort of Third Force. Of course not. But it is very much a question of forming a new democratic community which, within the Alliance, will to a large extent be responsible for its own defence. I do not say that it will be a nuclear body that will have to be thought out. But it must be responsible for its own defence. If we have a common defence policy, involving the standardisation of our weapons, there is no doubt that we shall he able to save a great deal of money into the bargain.

Finally, let us not imagine that by formally approving the terms next October and joining the E.E.C. we shall be entering a sort of Promised Land, still less a Garden of Eden. The growing pains inherent in this operation will be considerable. There will undoubtedly be rows and crises. Often we shall be annoyed with our new partners, and they with us. Nobody can say exactly how we shall eventually settle down. For a time it may even appear that the short-term sacrifices outweigh the long-term gains. But what there will be, if only, as I say, we accept a minimum of supra-nationalism, is an atmosphere of experiment, of high endeavour, of great new transport plans; of common educational projects; of vast and outward-looking schemes for organising international trade with, and aid to, the underdeveloped countries on a new basis; of group proposals for saving the environment and cleaning up our society by common accord. Western Europe, where the whole process of industrialisation started, should be the place where it achieves its final and, we would hope, triumphant consummation. If it does, its influence will undoubtedly spread further and further towards the East. It is for us to recover the optimism of the 19th Century and demonstrate the essential soundness of the civilisation of which we, rather than the great nations of the periphery, shall no doubt represent the final stage.

It may be that considerations of this sort will scarcely appeal to some of our more elderly nationalists—and certainly not to all noble Lords; but they will, I am sure, appeal to the younger generation. There is strong reason to suppose that, once we provide the framework, they will move in and will be able to make it function in ways which we are not able now to imagine. But, first, we must construct the machine.

I have little doubt that the proposal which we are now examining will eventually be approved by Parliament. This, as I understand it, is the conviction of about 80 per cent. of the British people who, even if 70 per cent. of them admittedly know little or nothing about the details, are nevertheless pretty shrewd when it comes to judging how things are going to go. Even that great comfort of the anti-marketeers, the recent large majority in favour of saying"No"to the Market, has now sunk to a mere 42 per cent. of those interrogated, which is not even a majority if the"Don't knows"are taken into account. After the holidays, unless perhaps too eager politicians on both sides bore people stiff by their efforts on the small screen, the figures may even be better. By then it may quite possibly not be the Marketeers but the"Antis"who are out on a limb. Can it be that even Mr. Wilson, conforming to a change in public opinion, might swim back to the ship which he has just rather inelegantly abandoned? At the very least, he might be prepared to allow his supporters the liberty of the vote. If the Prime Minister, while urging his own supporters to follow his example, could adopt in this last respect a broadly similar line, that would be perfect.

In any case, my Lords, nothing can shake my own conviction, and that of my colleagues, that in joining the European Economic Community, even at this late hour and on terms more onerous than we could have obtained ten years ago, this country will at long last have discovered its true post-war destiny and that, whatever disappointments there may still be, we shall before long be heading towards a happier, a more prosperous, and indeed a more honourable future.

4.25 p.m.

LORD SHERFIELD

It was fairly recently—in January in fact—that I spoke in this House in favour of Britain joining the Common Market if fair and acceptable terms could be negotiated. I have no intention of repeating what I then said—it is on the Record—except to observe that in my opinion the terms now recommended are in general better than I personally expected, and I therefore follow the noble Lord, Lord Carrington, in finding them acceptable. I do not see in them anything which will impair our sovereignty, upset our economy, undermine our social policies, or pollute our culture. On the contrary, the terms give us an opportunity to improve our prospects of economic growth and resume a role in the world commensurate with our political experience and our industrial and technological resources.

Having said so much, I shall not roam at large over the wide pastures of the White Paper, or try to compete in breadth of treatment with the three preceding speakers. I shall limit my brief remarks mainly to one point on which I have some little knowledge and which has not, I think, figured largely in the great debate, though it has been touched on here and there. I refer to the consequences of joining the Communities for the small and medium sized British firms; that is to say—depending on definition—firms constituting between a quarter and a third of British industry and commerce.

The large British multi-national and national companies and financial institutions have, for some years, been on record as favouring our entry, and a number of industrial leaders have recently reaffirmed their belief and confidence in letters to The Times. The opinion of smaller firms is not so clear cut. They are less vocal, and many of them may not yet have given the prospect their full attention. It is obviously dangerous to generalise about so large and diverse a group of companies, but I have some contacts, both direct and indirect, with a large number of smaller firms, and perhaps one or two inferences can legitimately be drawn. To some extent, the prospect for successful growth within the Common Market depends on the industry of which the particular firm is a member, but, by and large, it appears that an efficient and well-managed small firm has nothing to fear from entry and much to gain; while the inefficient small firm has very little future inside or outside the market unless it improves its management and its performance. The efficient firm will be poised to take advantage of the wider market, but the inefficient will face more intense competition from the rest of the community.

I have recently taken a fairly broadly-based sample of some small firms, and the reactions to a direct inquiry have varied from enthusiasm to optimism as regards the effect of membership on their business prospects. Their replies usually refer to the advantages of larger markets, lower entry tariffs, and increased opportunities for the efficient. Nor do they seem to be very much concerned about the effect of increased competition at home. I think there is a general realisation throughout industry, large and small, of the advantages of access to a market of 300 million people. I have been rather surprised by the strongly positive nature of this reaction. Of course, it is a relatively small sample; some firms expect to do better than others; and some may have misjudged the situation. But I have encountered no opposition, and what is good for the firms is good for the employment in them. The fact that I have found no opposition to entry in this sector does not mean that it does not exist. But it is perhaps not unfair to suggest that opposition is likely to come from inefficient operators, whether in industry or, indeed, in agriculture, and not from alert and enterprising managements.

The competitive advantages of small firms are flexibility and speed of reaction. The Common Market represents an opportunity to be exploited, and the good firms, the ones which react quickly and decisively to changes in their markets, will prosper. Many smaller firms are already selling effectively on the Continent. Others could and should follow their example. As for the increased competition in this country, to which I have just referred, it must be remembered that the Six offer a better and larger additional market to us than we offer to them, and it seems likely therefore that the British market will be less attractive for small Continental companies than the Continental market will be for our small companies. The point is that small firms sometimes compete with large firms, but their chief competition is from other small firms. So to that extent the danger of some of our small firms being stifled by increased competition in the United Kingdom will be mitigated.

Many small and medium-sized firms are already prepared, or preparing, for our entry, but the realisation of the opportunities has not perhaps in general been translated often enough into action: into market research, into analysis of competition, into training of staff, and so on. Chairmen and managing directors are disposed to favour our membership, but perhaps without doing enough about it. There is no time to lose if the many remarkable and enterprising small firms in this country are to get off to a start that their products merit. Recently small firms have been exhorted by, among others, the Confederation of British Industry and the Institute of Directors, to study the effects and the opportunities of our entry fully and seriously, and I must say that I hope that these exhortations will be heeded.

My Lords, perhaps you will allow me to add a few general words in conclusion. I have never felt emotionally about going into Europe: I have not been, like the noble Lord, Lord Gladwyn, who has just spoken, for many years a committed European. For a long time I kept an open mind, which is probably a euphemism for sitting on the fence. But as this country fell economically behind its industrial competitors, as conceivable alternative policies were revealed as failing for lack of political support or changing patterns of world trade or politics, I came to the firm conclusion that it was in our long-term interest to become a member of an enlarged European Community. I formed this view not just for the negative reason that we had nowhere else to go, but on grounds of positive advantage. I concluded further that it was not only in our long-term interest, but in the interest of our allies and friends in Europe, including EFTA, in the United States and, indeed, in the Commonwealth, that we should join Europe.

I believe that most well-informed people in these allied and friendly countries realise that this is so, and that if their own country is likely to suffer a measure of commercial disadvantage in the short term, they are ready to accept this. Let me say, on a point raised by the noble Lord, Lord Shepherd, that I believe it will assist in developing relations with Eastern Europe as well. My Lords, we now have an opportunity of entering the Community on relatively favourable terms. I do not think it will recur. I hope we shall take it.

4.35 p.m.

LORD POLWARTH

My Lords, the prospect before us to-day is nothing new. Two hundred and sixty-five years ago, in 1706, Scotland was faced with a decision every bit as important, relatively, as that with which Britain is faced to-day; namely, whether to enter into a Union with her larger and more prosperous partner to the South; a decision which once taken was to affect the whole history of Britain, just as such a decision will do in the case of Europe to-day. The circumstances were remarkably similar; there had been at least two previous abortive attempts; the concept was unpopular in many quarters in Scotland, among the public, the Church and elsewhere: there was fear that sovereignty and national identity would be lost; and it was not much more popular in England either. Just like to-day, differences of opinion seem to have cut across the usual political, religious and other lines. The preliminaries, too, bear a strong resemblance: the proceedings of the Scots Commissioners appointed to draft the terms; the late-night sittings of the Scots Parliament. All can be compared to the recent comings and goings in London and in Brussels; there was pamphleteering and politicking, and many of the arguments used were very similar to to-day's.

It may seem remarkable that, despite so much opposition, Union came about. But why was that? It was because the leaders of the day saw that Union was both necessary and desirable if Scotland was to win her share of the world's prosperity, and keep pace with the growth of other nations. They knew there would be drawbacks, and they knew that the advantages would be slow to bear fruit; but equally they saw that in the long term there was really no possible alternative—and with that conviction they were prepared to act as leaders, rather than bow to vested interests and heed the murmurings of the uninformed. That they acted in the interests of both countries alike is shown by the state of Scotland to-day compared with what it might have been, and by the contribution which Scotland has made to England and the world at large. In passing, it is relevant to note the shrewd observations on the opponents of Union made at that time by Daniel Defoe, who was installed by the English in Edinburgh as an"undercover"observer (and I think that was something of a euphemism) of the Scottish deliberations. He said that the opponents never dreamed that in deciding to unite: …a new national interest was to be created; and that giving or conceding rights, advantages and interests, whether in commerce or in privileges, was losing nothing at all, but was like a man giving presents to a lady whom he designs to make his wife. My Lords, with that historic event in mind, perhaps, I may concentrate briefly on Scotland's hopes and fears in these negotiations of 1971.

That there should be anxieties is not surprising. Farming, for example, is of great importance to us in the North, and we pride ourselves on its high standard. Others better qualified than I am will be speaking on this subject—but it seems as if some of our worst fears with regard to the effects on our agriculture, and particularly on our hill farming, have been allayed in the recent negotiations. The subject of fisheries will, I know, be raised by others, but it seems clear that the present policy of the Six would be most harmful to the inshore fishing industry, and I sincerely hone that the Government will not give way on this policy, even if it means reserving our position till after we have joined.

Turning to industry and its development, we in Scotland have two main concerns. The first is the need to maintain and develop regional policies which will enable us, and other similar areas, to attract and hold our share of those industries which will gain most from the Community's growth and prosperity. Scotland owes much to existing policies developed over the years by successive Governments of both Parties, with the help and advice of many of those involved in different fields of Scottish life.

But the battle for a better spread of industry and development is not yet won, as witness the severity of the present industrial set-back in Scotland; and it would be a tragedy if anything in the policies of the Community were to frustrate Britain's efforts in this field. It has been said recently by Government spokesmen that, in their view, our present policies in this field are fully compatible with what the European authorities would approve. I hope, like the noble Lord, Lord Shepherd, that we can have a categorical assurance on this subject in the course of the debate. I understand that as yet no common policy for regional development in the Community has been drafted, far less agreed. Therefore, by early entry we have an opportunity to influence the shape of those policies and to contribute the great experience we in this country have acquired in this field.

Our second main concern arises from our geographical position. In some re' spects this is of course a blessing. We are spared some of the horrors of the overcrowded Midlands and South. But there is no doubt that our distance from the concentrations of population and the centres of decision-taking in the South has been one of the obstacles to our growth—even if in many cases the obstacle has been more psychological than real. So we have always worked to secure better communications, and not without some success. Now, however, with entry into Europe we shall have to press for far better communications direct from Scotland and the North to the Continent, without passing through the frustrating bottleneck of London. It is not surprising that thinking in the South should have turned first to a Channel tunnel and to motorways converging on the Channel ports, all of which, while they may well help industry in the area, will distort the distribution of industry within the country and make life in the South-East increasingly unpleasant. What we must do—and this is our Government's responsibility is to give every encouragement to the development of alternative routes. At sea, as has been suggested already, we must develop our ports in Scotland and the North-East and services in Scotland from them. I see no reason why these should not be eligible for official help as part of the"infrastructure "—a form of aid which is apparently approved within the Community at present.

We also have in Scotland a unique asset in the deep water of the Clyde Estuary, which with encouragement and foresight could become a gateway to Europe, enabling goods to be transhipped from Scotland to smaller vessels to cross the North Sea to their several destinations, and so avoiding the crowded and increasingly hazardous passage through the Straits of Dover to the Continental ports. The Scottish Council's Study of these possibilities, under the title Oceanspan, is in the Government's hands and I commend it to them for thought and action.

Above all, there is the question of communication by air, which is so vitally important to business to-day. Our air routes in this country have developed just as our railways did over a hundred years ago. British European Airways sit at London Airport, rather like a spider in the centre of its web, and, with the exceptions of, I think, only two flights a day, in order to reach any destination on the Continent from Scotland one must change 'planes in London, with much frustration and delay. For example, practically all connections from Edinburgh to Paris involve one hour and 40 minutes between flights in London, and an elapsed time of nearly four hours from airport to airport, which in these days is quite ludicrous. If we are to have the best chance of attracting European industry to Scotland and developing our markets as we should, we must ask the Government to give the most active encouragement to the development of direct air links with the Continent.

I have spoken of Scotland's concerns so that the Government may be aware of them and reassure us on them. What I am convinced of, however, is that they fade into insignificance beside the benefits which entry can bring to the United Kingdom and to Scotland as an integral part of it. West German investment here, for example, is already growing. One of their Ministers at a recent meeting in London forecast a dramatic boost to such investment in Britain after we join the Market; and Scotland, with her industrial skills and experience, stands to attract a great deal of this. Scotland has, by history and tradition, ties with many European countries which the closer bonds of the Community will encourage and revive. We know by experience that, important though regional policies and incentives are to Scotland and to other similar regions, a far more powerful influence on their prosperity is the prosperity of the country as a whole and of the world outside. When the economy is sick, as it is just now, it is Scotland's pulse that is the weakest.

And who can doubt that our future prosperity lies in casting in our lot with the Continent of Europe? Who can seriously believe that we can prosper alone, or in association on the one hand with the might of America, concerned with its own ends and problems, and on the other the Commonwealth, still a grouping of value in the world but with such a diversity of outlooks, both economic and political? Who can believe it who has travelled regularly on the Con tinent and seen with what single-mindedness and success they have rebuilt their countries after the ravages of war, and the community of purpose which they have already achieved?

My Lords, this is one of the greatest decisions this country has ever been called on to make—probably the greatest outside a declaration of war. Such decisions cannot await the hammering out of every detail in advance. If they did, those decisions would never be made, or we should all be in our graves first. Of course there will be disadvantages. Concessions must be given as well as advantages gained. In what bargain was that ever not the case? I have no patience, however, with those Weary Willies who say we should not go in because the price of butter would be too high; the Doubting Thomases who say that our economy is too weak to stand the shock, or those in industry, in the unions, in politics or anywhere else, who are opposing entry because they see their own little empires threatened. I say to them:"Have some faith. Think honestly. Where does the greatest benefit lie?—not just to our own pockets, but to the happiness and prosperity (as the noble Lord, Lord Gladwyn, pointed out) of our sons and daughters and their descendants in turn." Surely there can be only one answer. And it is not only for our own sakes and those of our descendants that we must give it.

Throughout history our greatest achievement has been our leadership to the world outside. The Elizabethans carried our influence across the seas; the North American settlers laid the foundations of a New World: the Empire took British progress and ideals to a great diversity of peoples; and the Industrial Revolution spread our products and techniques to what is now the civilised world. Here, my Lords, is our next great chance to influence the course of civilisation: to go into Europe, not in a carping or grudging way, but with enthusiasm and hope, ready to contribute our long experience and many skills and to give the leadership which we are uniquely qualified to do. That is surely something eminently worth while doing, and we in Scotland for our part will welcome the chance to contribute our share as we have so often in the past.

4.49 p.m.

LORD GEORGE-BROWN

My Lords, I am very glad to follow the noble Lord who has just sat down because, knowing the West and Central belt of Scotland as well as I do, and having been greatly involved with it for two hectic years in trying to help to restore and encourage there some industrial virility and development, I was glad to hear the ringing tones in which, on behalf of Scotland, he accepted that it was right that the whole community, the whole country, and the whole of our islands, should in fact join the European Economic Community. This House has many attractions over the other one. One of them is the frequency with which, just before one rises to one's feet, one receives a number of hastily written notes in even more hastily sealed envelopes, regretting deeply that the writers will not be able to stay to hear what one has to say. I now have a pocket full of those. May I say, I wish you all the best, wherever it is you are going. I trust you do not regret more than I do that you have got your priorities wrong.

My Lords, I feel I owe an apology to the House for intervening again in a debate on whether we should join the Common Market, whether we should help to form a wider and more integrated Europe. One seems to be doing it all the time and one has an awful feeling that maybe folk are getting a bit fed up with hearing the same old candidates for recognition every time. I do it again this time partly because of my personal sense of involvement, which is very great and very deep, and partly because other people do not seem able to expound their own views without dragging me into the subject. Last night, so the newspapers inform me, on television the Leader of the Opposition in another place declared that"he"(meaning me) was a dedicated European, willing to go in on almost any terms, whereas he (meaning himself) was in favour of joining only on the right terms. I should have said that that was a collection of the most emotive terms one could possibly use about the other party while, as always, giving himself the benefit of any doubts going. On the contrary, the other day in the other place he occupied columns of their Hansard with hitherto confidential quotes to show that I made the harsher, the tougher, noises on New Zealand. Somehow it does not seem to me that both those things tie up, and there are only a few days intervening between those two statements.

It is a bore to be continually putting the record straight on the events of 1967. It is a bore to the one who does it and, I suspect, a bore to those who hear it. I have recorded elsewhere my recollections of the attitude of the then Government's approach and my view of the comparison with the present terms presented to Parliament by this Government. This Government claims to have played the hand which we prepared for the negotiating table—and I like to remember that I was the Chairman of the Ministerial Committee responsible for so doing. We must have been fairly good at preparing, and they must have stuck very closely to our brief, because, my Lords, it has worked out pretty well exactly as we thought it would.

Before I come to my view of the present position, may I, with your permission and, optimistically, for the last time, attempt to dispel any confusion by setting out as clearly as I can the steps by which the Labour Government reached the conclusions that they did and prepared to negotiate—and I promise not to quote from any security document. The first step was when the then Prime Minister and I persuaded Ministers in the Cabinet of the need to accede to the Treaties if acceptable terms were negotiated. We did that. In some cases it was not easy. It is fair to say that some Ministers were not ever persuaded, but we did persuade the Cabinet, and we did it on both economic and political grounds. I think it is fair to say of the then Prime Minister that he was rather more persuaded by the economic considerations than I was, and I was rather more persuaded by the political considerations than he was.

In the course of this operation we set out to our colleagues the major areas that we could see of possible difficulty. I do not pretend to give them all but I think I can give the major group: the effect upon our balance of payments—and, as would befit my right honourable friend's past and experience, that weighed heavily with him; the effect of the Common Agricultural Policy—again in terms of our overseas expenditure as well as in terms of what it would cost people here at home; the movements of capital—of course boundless; the financial contribution we should have to make—the"key ", we called it, and so I see it is called in the present White Paper; our Commonwealth obligations, and our ability to apply regional policies because of our regional imbalance—the very thing that the noble Lord, Lord Polwarth, has been speaking about; the mobility of labour, and the transitional periods—and we emphasised"periods"and did not speak of just one; and our position as a nation in the discussions that would be going on in the Community meanwhile—in other words, before we got in. Whether that is a total list I do not know, but it is a fair list of the areas we identified for our colleagues before they made any decision at all. Having done all that at great length, the then Prime Minister and I obtained authority to talk to each member of the Six on these issues, and of course to talk concurrently with EFTA and with the Commonwealth. That was the first step.

The second step was the tour which he and I made from capital to capital in Europe. I did not quite like the description given last night on television of the"soft-shoe shuffle ". One of us was walking in hard shoes. As we went round the capitals we went over all this ground, speaking in every capital, as those in this House who were then with me in one capacity or another know, and speaking from identical briefs in every particular capital, because we knew that by the time we arrived at number two, or number three or number four, the record of what had been said in number one or number two would already have arrived. And of course we emphasised the serious problems for us and others. We did not do any minimising at that stage; we did not do any trimming at that stage. We were finding out whether people wanted to negotiate, and we took trouble to emphasise the difficulties rather than to do a"soft-shoe shuffle ". We were not negotiating there.

The third step was when we returned, at which stage we were both apparently convinced, (a) of the need to pursue this to a successful conclusion and to obtain membership; (b) of the apparent willingness on the part of the others to negotiate seriously—and while there were different degrees of enthusiasm apparent there was no evidence that anybody was going to put up a black ball at that stage; and (c)—this is very important—that the troublesome issues, the really difficult ones, were fewer than we had foreseen, and that on the really troublesome ones solutions which would be acceptable appeared to be available. This was a view we jointly formed.

And so we went to the fourth step, and we jointly put this to our colleagues, and after exhaustive—if I may say so, exhausting—discussions over many, many meetings and more than a few weeks, and with all our colleagues having before them the fullest records of our discussions and our conversations in every capital, we jointly recommended, and ultimately persuaded the Cabinet, by what is I think said to be a substantial majority, that we should be authorised to table an application to apply unconditionally for entry. Applying unconditionally, of course, did not mean entering unconditionally, but it did mean applying unconditionally. This we did at a Chequers meeting—I remember it so well—and we recorded our strong view that if Britain's entry were conceded a satisfactory solution for New Zealand would emerge.

So we got authority to recommend to Parliament that we should thus move, and seek negotiations to arrive at solutions acceptable to us on the main issues, leaving all other subjects for later decision after we had joined. This was then put to Parliament, was authorised by Parliament, in that enormous vote in the other place, and this was the course I then followed at The Hague, using a little sleight of hand in order to get it on the table at a meeting which was not properly constituted so to take it. Having done all that, we were then in business for negotiating, and. I repeat, jointly and collectively responsible.

We then took the next step, which was to prepare the negotiating briefs. These were prepared by joint committees of officials, presided over at the highest official level, responsible to the highest personage in the Government; and they were prepared under Ministerial guidance all the time. On each of the main issues briefs were established on the basis of which the negotiators were to operate, whether they were Ministers or whether they were officials, and within which they were to operate. This was done by the end of June in 1967, and I assert to this House that there can be no gainsaying of the joint and collective responsibility of the two Ministers then carrying major responsibility. There can be no gainsaying, either, whether it is convenient or inconvenient, that the issues covered in this White Paper are the ones we ourselves identified as being the main issues.

There can, in my view, be no gainsaying, either, that the terms negotiated and recommended in this White Paper are in line with the terms we were prepared for. There can be no gainsaying, either, that while the then Cabinet's final position was, clearly and obviously, reserved, as of course it had to be, till they saw the outcome, those of us responsible, in my view, would have been bound in honour and in every other way to recommend these terms, or as I have put it before, something not significantly different, unless we, or one of us, had never meant the exercise seriously in the first place.

I therefore take my stand with those who say these are not"any"terms, they are not"almost any"terms, these are the terms, or are very similar to the terms, that we thought would be right and acceptable. One always tries for more, but we were prepared for these. For myself, I can see, no reason why, if they were right then, they become wrong now. The economy is not weaker now; the balance of payments is not thinner now. There may be many things wrong with the economy, but it is not weaker than then. I cannot in all conscience and honesty and dignity find it possible to deny it.

What is the change? I am now on these Benches instead of those Benches in another place. There is the little matter of a very temporary, as I trust—and quite unnecessary, as I know—Conservative Government over there. But as I always say to my friends in the City and elsewhere: do not blame me, I voted Labour. Neither did I choose the point of the Election either; that is another story altogether. But I do not believe that vast issues like this can be decided, or should be decided, on a basis of, or by a reference to, which Party is temporarily in power at a given moment. This decision, however settled, will condition Britain, will condition the Continent to which we belong, will condition the world in which we live for more than decades, for more than generations. On the assumption that we are still going to keep our democratic system, I trust that there will be more than one change of Government in that period!

I think we must now decide some questions that have nothing to do with who is sitting on the Benches opposite. First, do we believe that a wider and a more integrated Europe is urgently necessary? Secondly, do we think Britain would benefit from that, if it were to come about? Thirdly, are these terms, and the price that they call for, acceptable for that purpose and for those compensatory benefits? For myself I think we must all stand up and be counted. My noble friend who opened talked so much about not being able to make up his mind and waiting for October, but I think we all have to stand up and be counted, and the sooner the better. For myself, I believe that the terms are acceptable. I believe that the purpose is right. I believe that the price is within our capacity. I believe that the compensatory benefits are well worth paying for. No speeches, no writings that I have heard or read have managed to shake me one bit. Indeed, I say this. The absurd exaggerations, the distortions, the prejudices and the sheer frightening xenophobia that so many of them reveal would, I think, have persuaded me to my present position if I were not already persuaded. For those who will read the White Paper's figures, whether on the balance of payments issue—the pluses and the minuses—whether on the cost of living consequences, or on the effects on our Commonwealth partners, or on our capability to operate regional policies, or on our status as a nation, as a country, as a Government or as trade unionists and industrialists in the various institutions of the Community, and on our ability therefrom to influence future decisions in a way which we cannot currently do, must, I submit, surely answer the exaggerated and shrill prognostications of doom and gloom!

The sovereignty argument never was a runner. Under this proposal we keep what matters of our own sovereignty and we gain, in addition, a vital and powerful share in the much wider sovereignty of the Continent of Europe as a whole. We gain, too, the opportunity to share in a much wider, prosperous and growing market. What, I ask myself, makes that such a fearful prospect to some trade union leaders? Is not that what we need? Is not that what will spur industrial investment and economic growth, and create the very job opportunities that we are so worried about? Or are some of them determined to prevent that happening, or afraid to face up to the industrial changes for which it calls?

But, above all, is not this move to join the absolute requisite for gaining a role for Britain? I have long smarted under Dean Acheson's remark, that we"lost an Empire and failed to find a role ". Is not this the absolute requisite for finding our role, for ensuring that we influence the political developments on the Continent of Europe? It is all very well exercising our minds and our thoughts and our fears about Germany, or about another Rapallo or about the danger of the Ost Politik. If we are there, cannot we influence; whereas to-day we cannot influence what is done and what goes on? Is it not a requisite for being able to prevent the emergence in Europe of undesirable blocs, undesirable attitudes, undesirable policies in our own Continent?

We are not joining Europe. We have never been in China or Asia. The issue is that we have always been involved, always too late and always with deep suffering. What we are discussing now is not joining. What we are discussing now is getting there while we can influence the policies, and, maybe, avoid the payments and the suffering. Is it not an essential requisite for being able to prevent the domination of the world by the super-Powers settling all over our heads, much of it against our interests? Is it not an absolute requisite for increasing the ability of this Continent really to assist the developing world with its urgent, tragic, frightening problems? I speak only for myself, but I believe that it is. I regard the purpose and the opportunities as justified and justifying. I am prepared to accept the price and the terms as being right and within our capacity. I do not believe there is any alternative available to match what this offers to Britain. And, as I am not a little Englander, I can only from these Benches commend this White Paper as I should have done from those opposite.

5.19 p.m.

LORD BOOTHBY

My Lords, the noble Lord who has just sat down has made a characteristic and most courageous speech, which I am sure has been listened to with fascinated interest by all of your Lordships. I think we must accept his account of what happened under the last Administration, just as we accept the fact that he has stood up to be counted here to-day as a full out-and-out supporter of joining a united Europe and the Common Market. Unequivocally he has declared where he stands, and I think the time is rapidly coming when we must all do that because there is too much shilly-shallying going on now, and the discussion has lasted for a very long time.

My Lords, at least I am on the record for the last 25 years. During the last two days I have been looking up my speeches, both here and in another place, on the subject of European union. I find that I have already said almost all that otherwise I might have said this afternoon, and I am not going to repeat myself. If any of your Lordships doubt my credentials, I would venture most humbly and respectfully to appeal to your Lordships to look up in Hansard the speech I made just over ten years ago, on June 30, 1960, to your Lordships' House. That shows where I stood then, and that is where I stand to-day.

In a debate of this magnitude one has, I think, as a mere Back Bencher, to be very selective. Past figures can be accepted because they are subject to proof. Future figures, with which we have recently been deluged both in the White Paper and elsewhere, can at this stage be only pure guesswork; and I do not think that too much importance or value should be attached to them. There is only one issue on which I have doubts and anxieties and which I am going to mention to your Lordships. Apart from that, like the noble Lord, Lord George-Brown, I wholeheartedly accept the terms that have been negotiated by the Chancellor of the Duchy of Lancaster. I believe that they are acceptable to this country; I think they can be borne by this country; and I think they are the best we could have expected. Indeed, in some ways they are better, and the Chancellor of the Duchy of Lancaster ought, in my view, to receive more congratulations, publicly and in both Houses of Parliament, than he has done for the magnificent work he has done and for the results he has achieved in Brussels and in Luxembourg.

Your Lordships are no doubt familiar with my anxiety, but I must mention it again, because somebody has to speak on behalf of the fishermen, and it is a matter of great importance and concern to many of us. Mr. Prior, the Minister of Agriculture, said in another place the other day, in their debate on this subject, that he hoped that fishermen will not allow themselves to be used by unscrupulous people who are jumping on to the fisheries bandwagon to grind other axes."—[OFFICIAL REPORT, Commons, 23/7/71, col. 1851.] I really think that that was a little unfair. As one who has taken a leading part in the campaign on behalf of the fishermen, I can say that I have no axe to grind except the one I have been grinding for a quarter of a century, to bring about what Churchill once described as,"a kind of United States of Europe"in which we should ourselves play a full part.

The primary responsibility of the Minister of Agriculture and Fisheries, and indeed his duty, is surely to protect and foster our agriculture and our fisheries, and he should sympathise with their fears and anxieties at this moment. Because, my Lords, we have to face the fact that the E.E.C. fishery regulations were rushed through on the very day that we started negotiations to join the Common Market, and despite the fact that, if the Community was enlarged from the Six to Ten, the whole character of the fishing industry would be completely changed and the E.E.C. regulations could not possibly apply. In fact, we should be a net exporter rather than an importer of fish, as the Six are to-day. Under the E.E.C. regulations, all foreign trawlers, with their beam trawls and small meshes, would be allowed to fish right up to the beaches all round our coasts, and that would certainly lead to the total ruin of our inshore fishing industry. I say to your Lordships, if I may, that that would be too heavy a price to pay, even for entry into the Common Market. My Lords, we should stand, I suggest, and in my submission, on the Fisheries Convention of 1964, which, in the words of the Minister of Agriculture, is, the only internationally agreed régime for the waters with which we are concerned ", and the basis on which a future agreement between the Six plus the Four should be reached. It took years, my Lords, to achieve this; and it has worked very well from all points of view, including that of the Continentals. I think Her Majesty's Government would have been well advised to say that we stand by the Fisheries Convention of 1964 as the basis of all negotiations—and the Minister himself came very near to saying that in another place last week. But now they appear to have given some ground. Let me spell out—and it will not take me more than two or three minutes—what I think are the minimum requirements. The limits as drawn from the base lines must ensure the complete protection of the prolific breeding grounds around the long coast of this country, and I mention specifically the Minches, the Clyde, the Moray Firth, the Solway Firth, Cardigan Bay, Morecambe Bay, Devon and Cornwall, the Wash and the Isle of Man. The fish breed all around those coasts, and we must ensure absolute protection of these breeding grounds. We must see that whatever limits are drawn beyond the base lines ensure that protection. There is a separate problem so far as the herring industry is concerned, which affects the Shetland Islands and the Yorkshire coast, because off those coasts most of the herring shoals usually swim within the area between 6 and 12 miles. They must also be protected by any arrangements that are made.

Finally, on this issue, I would suggest that there can be no temporary agreement covering a period of, say, five years, after which it will all have to be renegotiated, when we are a member of the Community and in a minority. Because I do not think that that will work: we must have some permanence. I very much hope that, before we are finally asked to take a decision in October, the Chancellor of the Duchy, of Lancaster and Her Majesty's Government will be able to come down to Parliament with a pretty firm agreement about fisheries covering an indefinite future. Because, my Lords, if adequate protection were not to be given to our inshore fishing industry, and if it were to be sacrificed altogether to the present E.E.C. fishery regulations, I should have no alternative but to vote, with a heavy heart, against our going into the Common Market. I have fought for a united Europe for a quarter of a century, but I have fought for our inshore fishing industry for half a century, and I am not now prepared to see one of them devoured by the other.

But I am not at all unhopeful. I think the Chancellor of the Duchy of Lancaster is well seized of the problem. I have been in continuous touch with him during recent weeks, and I do not think he will give way to the point at which our inshore fishing industry will be ruined; indeed, I have had letters of assurance to the contrary from him. Moreover, I suggest that there will be no need for him to give way, because if the European countries really want us in, as I believe they do, they will not insist on ruining our inshore fishing industry as the price we have to pay for entry. I do not believe they will do that, and therefore, as I say, I am not at all unhopeful. But I hope the Government will take a very firm stand upon this issue, because, although it affects a not very substantial proportion of our population, it affects the way of life in many parts of this country, and above all in my native country of Scotland.

That said, I should like to conclude by saying that in its present form the E.E.C. is a pretty shaky structure, mainly because it has as yet no political foundation. My experience of your Lordships' House over the last eleven or twelve years has been that the noble and gallant Viscount, Lord Montgomery of Alamein, is very often apt to get to the heart of the matter, and I am going to give two brief quotations from what he said and wrote quite a number of years ago which seem to me to get to the heart of the problem. He said: The task before the nations of the West is primarily political. Economic fusion and military strength will not be obtained until the political association between the group of nations concerned has first been defined. The second quotation—and it is even more relevant today—is this: Europe must render to the United States the help she is entitled to expect as leader of the Western Alliance by standing together as one united whole. We cannot in fact give to the United States the defence assistance which she is entitled to demand unless we are united, and that is one of the most formidable arguments in favour of unification.

If I may suggest it, we really have got to get back to the ideas and ideals of Strasbourg and the Council of Europe in the 1950s; because they were right. They have been proved to be right. Full economic and monetary union on a constructive and expansionist basis, and effective co-operation in the fields of foreign policy and defence, cannot be achieved without a political foundation. A European political authority with limited functions but real powers was approved unanimously, with Churchill's approval, by the Council of Europe in 1949; and we are still waiting for it. I suggest to your Lordships that new forms of organic political union, which are not a surrender but a joint exercise by consent of certain defined sovereign Powers, must be devised. If this E.E.C. conception—and I prefer to call it the"United States of Western Europe "—is ever to achieve a real, lasting success there must be a political basis to the whole thing. It is our mission and our task, as I see it, with our vast political experience, to bring what we can to the councils of Europe in order to assist in this development and ultimate achievement.

My Lords, in the 1950s there could have been a marriage between this country and the Continental countries of Western Europe based on affection and gratitude. The Continental countries, without exception, in the 1950s begged us to take the lead; to give them the necessary leadership and to form this"United States ". We turned it down absolutely ruthlessly. In the 1960s there could have been a marriage of convenience; but again we turned it down. We did not even send a delegate to the Messina and Brussels Conferences which resulted in the Treaty of Rome. Now we find ourselves in 1971 confronted with a marriage of necessity. I see no alternative. But marriages of necessity do not always fail. Sometimes they can turn out to be a great success, and ultimately end up as marriages of affection and gratitude. That is what I should like to see.

I have nothing but admiration for the steely determination of the Prime Minister. I only wish that his predecessors during the last 20 years had shown the same steely determination in pursuit of this great and fundamental objective, which is certainly the greatest issue of our time. But I would say this in conclusion. I hope that he will realise that this issue really does transcend Party politics—as I think the speech of the noble Lord, Lord George-Brown, proved conclusively this afternoon. When the decisive moment comes next October, I should very much like to see a free vote in both Houses of Parliament—both on the Tory side and on the Labour side. I have little doubt of what the result of that vote would be. We cannot have a referendum. I do not like referenda; and, anyway, they are not in the tradition of this country. A free vote of Parliament on an issue of this magnitude seems to me to be immensely desirable; rather than to turn it, as some people are now trying to turn it, into a Party issue. It is not a Party issue; it is far bigger. I would make an urgent appeal both to the Leader of the Opposition and to the Prime Minister to consider giving a free vote to both Houses of Parliament—in which case, as I have said, I have little doubt what the result would be, if that result does come this autumn, then I shall feel that all the years of misery and frustration, from 1949 to 1957, that I spent at Strasbourg as a delegate to the Council of Europe were not, in the long run, in vain.

5.35 p.m.

LORD McFADZEAN

My Lords, the two noble Lords who opened this debate referred to the trepidation with which they spoke. Believe me, the word is wholly inadequate in my case; for this is my first verbal contribution to your Lordships' debates and I therefore crave your indulgence. To follow the oratory of this afternoon is not easy for a newcomer and I feel that all that I can do is to bring out the industrial aspects of this great problem as I see it. I think we have to satisfy ourselves in industry and in the country over the answers to these questions. Have we examined all the courses open to us? Is the decision we are going to take right?

Emotionally, one turns to the possible creation of the Commonwealth into a viable economic unit. But, sad as I am to say it, it is not a practical proposition. As only one example, I would suggest that we glance at the position of three of the oldest members of the Commonwealth. In spite of differences of opinion from time to time between Canada and the U.S.A. there is an established and growing affinity, culturally, economically and in many other ways, between them, through sheer proximity and mutual interests. As regards Australia and New Zealand one has just to study the fantastic increase in trade and growing inter-dependence over recent years between them, Japan and South-East Asia generally, to realise that there is economically a natural regional grouping developing there. By all means let us do everything possible to increase cultural and trade relations between Britain and the Commonwealth; but to create this as a viable economic unit is a pipe-dream in the world of to-day. The clear message which conies to so many of us in the Commonwealth is one of increasing understanding of our position and an acceptance that one of the greatest present contributions that Britain could make to the strength of the Commonwealth is to become economically strong herself and thus be able to play her rightful part in world and Commonwealth affairs. A strong and competitive Britain, and only a strong and competitive Britain, will recapture her rightful share of Commonwealth trade.

My Lords, I turn briefly to the North Atlantic Free Trade Area or to some special relationship with, say, the U.S.A. and Canada. Again, emotionally, this must appeal to us with so many of our kith and kin in these countries and with almost a common language between us. But this, too, is not at present realistic. Certainly, from my frequent visits there I cannot find any real desire for such a relationship existing politically or economically. It could only lead gradually to domination, to our being the 51st State. I am all for partnership; but I am fundamentally against domination.

So I come to the third possibility, that we"soldier on"ourselves as we have done successfully in the past. But the past is not the present, and even less the future. If industry decides to carry on we must pursue that course with a full appreciation of the facts; because. apart from our native skills, we have few of the essential natural resources to fight successfully for world markets against other countries who are richly endowed. We should also be fighting from an increasingly restricted base, for the trend in the world to-day is certainly towards regional grouping of increased economic and technological strengths. The effects of this, to some degree, have already been experienced in the 1960s and I am sure will be increasingly felt in the 1970s. Here I would suggest that we must recognise that Britain could not overnight, or indeed in any practical time, adjust her economy to become a highly specialised one like that of Sweden or Switzerland. We are equipped to be a major world Power and, certainly, an exporter and we must have the environment to oporate as such to win our vital proportion of world trade, to attract investment and not to repel it as would a restricted economy and a curtailed scope of operation.

So, my Lords, we come to the last of the courses open to us; that is for Britain to join the European Economic Community. I suggest that before any final decision is taken we must ask ourselves some searching questions. The first is, has the E.E.C. economically been a success? Surely there can be no doubt about the answer—Yes. Discount, if you like, that some factors, such as the growth which has been taking place in world trade, have helped, but one cannot dispute that between 1958 and 1968 the E.E.C.'s internal trade increased fourfold, its world trade grew twice as fast as ours and is to-day almost twice that of the United States of America and accounts for nearly one-fifth of all world trade. Look also at the vast capital investment that has taken place and the increasing power of the Community in world economic affairs.

Secondly. I ask myself, by comparison how has Britain fared? Of course there are always some extenuating circumstances, but Britain's performance, to put it at its mildest, has been extremely disappointing. We have had a much smaller growth than any other major country has had; a fall away in some of our industries; a serious decrease in vital new investment and a loss in our share of world trade in manufactured goods from 16 per cent. in 1958 to 11 per cent. in 1968; and our standard of living which, measured in terms of gross national product per head, exceeded in 1958 every country in the Community except Luxembourg, is to-day lower than any except Italy.

The third question one asks oneself is, what are the reasons for this deterioration in our position? My Lords, there is a whole host of them, but to me the major one is the erosion in our competitive position. To remedy this I believe two things are essential. The first is that in this world of to-day, and even more so to-morrow, we must have a larger home market and be able to attract essential new capital if industry is to exploit to the full the latest technology, production and commercial techniques and recapture her appropriate share of world markets. The second requirement is that we must work more effectively. I yield to no one in my admiration for the great majority of British management and people—and I have said so throughout the world—but let us be brutally realistic with ourselves. There has been a loss of sense of purpose and direction by far too many people in this country, an over-readiness to take and a reluctance to give.

So, fourthly, I ask myself what should the course be, and I feel that it must be to join the E.E.C. Of course it will increase competition, but that is no bad thing and something we shall experience whichever course we take. Of course it has its disadvantages, but in any worthwhile partnership there must be give and take. But how overwhelming are the potential advantages—having a home market five times greater than at present, the basis on which to regain our position as a major industrial country, to improve our standard of living, to restore the objective and effort of our people through giving them a new horizon and to retain our vital voice in world affairs in this new era of super-Powers and large regional groupings when economic strength will certainly determine how much our voice is listened to.

On terms, admittedly an accurate financial assessment of some of the items cannot be made, but on any reasonable overall assessment I believe the terms are equitable and I am confident that they compare favourably with any realistic assessment of not going in. Has any momentous step ever been taken in history, or indeed in business or private affairs, that has not demanded a blending of economics and hunch, a belief that the contemplated step is right? There are, of course, other aspects to this great question, such as the political one that I must leave other speakers to deal with, but, taking all such factors into account to the best of my ability, I believe there is no practical alternative to our joining the Common Market and that it will also prove to be to our advantage to do so.

My Lords, I first came into national life at the time of Messina and I witnessed then the tragedy of Britain not participating in the talks that led up to the Treaty of Rome. I subsequently watched at close quarters the inception and development of the Common Market. Of course it has had, and will continue to have, its problems, but it is an inspiring conception and has achieved much not only economically but in so many other ways, as, for example, the dedication of its people. How many European industrialists and other people we all know were frightened to death when their country joined it but who today thank God they did? It will in time fulfil, I am confident, all its high objectives. Do not let us lose, certainly for some time ahead, another opportunity of joining. Let us also bear fully in mind what a contribution Britain could make to an even greater Community and what a contribution Britain could in turn receive.

My Lords, I thank you for your patient hearing. I"take note"of the Government's proposals regarding Britain and the European Community, deeply conscious of the great challenge they present but convinced of the infinitely greater potentialities they give and which we must grasp.

5.47 p.m.

LORD SOPER

My Lords, I am happy to congratulate the noble Lord, Lord McFadzean, who has just resumed his seat, on his maiden speech. We were seized with the deep sincerity with which he spoke, the care with which he had prepared his speech and the urgency which characterised his utterance. We shall hope to hear from time to time more from the noble Lord who has already put us under a sense of obligation to him.

My Lords, I have the onerous responsibility, as it now appears, of being the first in this mammoth debate to take an entirely opposite view from those which have hitherto been expressed in your Lordships' House and to disturb the somewhat placid pool of controversy which has hitherto characterised the opening speeches of this debate. Perhaps that calls for one or two preliminary observations. I hope to behave myself in the same spirit of irenical and persuasive argument of which you have received ample evidence in the speeches preceding mine. I hope that there will be no suggestion in what I say of a parochial or Little England attitude although, rather unlike the noble Lord who opened the debate and who in excessive modesty felt that he would not be likely to influence anyone who listened to him, I hope that I may be able to influence some of you. Although the trumpet may be of a very indifferent character, I hope that it will go forth in no"uncertain sound ".

My Lords, this particular debate on a White Paper can conveniently, and I do not think arbitrarily, be divided into two parts. The White Paper itself makes a clear distinction between the economic reasons for which it is desirable in the, view of the White Paper that we should enter the Common Market and political reasons why we should do so. I should like first to refer to the economic reasons and preface what I have to say by a condition of mind in which I find myself, which I dare say is not peculiar. I read the arguments of those who are convinced that it would be to our advantage to join the Common Market and the furrows in my brow clear and my mind is set at rest. I feel that the last word has been spoken. Then, unfortunately, I read an article by someone taking the entirely opposite view and deploying with equal certitude a number of economic propositions which seem to be equally coercive, and I rather feel that that from which I suffer as a layman in these economic minefields may well be something which is characteristic of a great number of people. Therefore I have looked rather more carefully at the actual substance of the economic argument, and I find certain indisputable flaws in it which I would dare to relate to your Lordships.

There is a great deal more eschatology than economics in the proposition that we are going to see certain things inevitably flowing from the decision to enter the Common Market. I do not know, and I do not think anybody else does. I think there is nothing more dangerous than to be prophetic on a very few hard facts. The more I read of the economic position, the more does it seem to me, in any case, a thoroughly inadequate reason, if it were the first reason, for deploying our resources in this new and revolutionary field; and it encourages me to look even more deeply, if I may say so, and to question the economic debate at its source.

It would be obscene to pretend that an increase of productivity and wealth would not be a blessing to those who are underprivileged, those who are hungry and those who are illiterate. But I wonder whether it has struck your Lordships that there may be an optimum to the kind of affluence which can go hand in hand with the true dignity and amenity of a civilised life. We have already been warned of the characteristics of pollution. Many of us have read Galbraith and the Consumptionist Society, and the warnings that go with it. Not too professionally, I am inclined to say this: that there is, I believe, a grave danger in assuming that there is an arithmetical or a geometric progression which accompanies an increase in the means of life: rather the quality of life may suffer. It does not seem to me that this country would necessarily be better off if we were immeasurably or considerably more wealthy.

It may well be that the future, such as it now invites us on this planet, may be a future in which we deliberately are prepared to discipline our accretive, predatory and certainly our acquisitive natures, for the very reason that otherwise we shall be imposing upon the very world in which we live insufferable and intolerable pressures. It is for that reason that I am sceptical of the precedence of the argument that we should go into the Common Market because we shall be better off. And if indeed it be argued that we are not well off now, I, as a Socialist, would claim that a proper redistribution of the available wealth might fill all those gaps which now we deplore, and there would still be more than enough to go round; in which a community might live in amenity, comfort and dignity, and might pursue, I think, those higher virtues, which are not necessarily the same thing as the acquisition of a considerable number of propensities to enjoy oneself, or commodity and other amenities.

It is, however, on the political issue that I would dare to delay your Lordships, because here I am irrevocably opposed to our entry into the Common Market. I am irrevocably opposed to it whatever the particular conditions, because I see in it a menace to those things which are nearest and dearest, I am sure, to the hearts and minds of all your Lordships, as they are to me. This has nothing to do with the religious argument which I see has appeared occasionally in the Press: and I noticed in The Times the other day a number of letters deploring the possibility of our entering the Common Market because we shall be under the heel of Rome. This prospect of ecclesiastical ultramontanism is, I think, a waste of time. If we were not capable of dealing with it at the time of the Reformation, your Lordships might like to know that the Methodists have since been added to the forces of freedom, and therefore there is less chance of such subjection now than ever there was before. This is a ridiculous argument, and I treat it with amiable contempt.

But the argument that I would seek to put before your Lordships belongs to another field altogether. I am sick to death of the nation State. It is the most predatory violent institutiton that man has ever contrived. It is, I suppose, part of the deposit of the Reformation in the West. The prospect of seeing a number of super nation-States, to which already has been added those of Japan, in the near future will be added China, and now perhaps an increased E.E.C., is, to me, a deplorable one. I do not take any comfort from the assurance that we shall then have a balance of power. Being trained at the better of the two great universities, I read my Cambridge modern history, and I know full well that the balance of power is the promise of wars every 25 years. We may have avoided that for the time being, but I have no comfort whatsoever from the assumption that the proliferation of the super-States will in itself be a guarantee, or even an augury, of peace: I think the very opposite is likely to happen.

Secondly, my Lords, I am a Socialist, and you will not expect me to deplore that fact or to apologise for it, any more than noble Lords on the other side would want to apologise if I were to ask them whether they are Conservatives, or whether others are Liberals. I am proud of being a Socialist, and it is because I want to see Socialism in Europe that I am extremely dubious whether the entry at the moment, or in the foreseeable future, of this country would not be a marriage of convenience for capitalists, rather than the inception of a truly Socialist community throughout Europe. I take the view that we shall support the capitalist case; and the very fact that, with such tremendous enthusiasm, the capitalist Powers, both in this country and elsewhere, are already heralding the prospect, seems to me a grave reason for having the most profound suspicions about it. The best way in which we can serve Socialism, if we believe in it, is to turn this country into a Socialist community, first of all, and then we can begin to exercise a proper influence on other people. If we go in now, I very much doubt whether the forces of Socialism will be increased: in fact, I think they will be diminished. And it is for that reason, again, that I am extremely hopeless when I think of the prospects of our entry into the Common Market.

I am not particularly impressed, my Lords, by the arguments about sovereignty, because sovereignty, if it is unharnessed power, does not exist anywhere except in the supernatural field; and in any case, we have already had our sovereignty eroded in many ways, and it will be eroded again. If we are to surrender our sovereignty, I want to see that sovereignty surrendered in the interests of something that by-passes the nation State and the super-nation State.

In conclusion, I would invite your Lordships to consider what to me is a prime matter of supreme importance. I do not believe that the normal process, or the peaceful process, is from the State to the super-State, in the hope that, through the super-State, we shall arrive at a time when we shall emerge into the area of world government. I think the super-State is a retrograde State, and for me the imperative need in the world to-day is that we shall move out of the super-State, or out of the super-nation State, into a concept of world government. We have talked about world government; we have doffed our hats to world government; we have sent our representatives here and there; and we have the instruments of world government in the United Nations. I should have thought that now is the time for us in this country to make this tremendous effort, which I believe we are particularly and peculiarly able to make, of by-passing this iniquitous business of the nation State, and beginning to cast our sovereignty, if we are going to make it a gift, to the interests of world government.

I prophesy—and I bet my cassock I am right—that if we go into the Common Market, it will not be long before this new super-State will want an independent nuclear threat weapon. If that happens, we shall be in a mess; we shall be in an even worse mess than we are now. Therefore I hope that, whatever else is done, we shall avoid considering only those matters which lie behind the personal desire for better conditions—the very proper desire for a wealthier and happier community here. This is not the way. It is not the way because it bypasses, or in fact circumvents, those particular avenues of approach to a better life, a happier world, and particularly a happier Britain. I am quite sure that what has happened in this debate already, and what will happen, is that we shall proceed with the fellowship of controversy. In that fellowship, I at least believe that first principles must take a primary place: and those first principles, for me, are world government within a Socialist community; and neither of these objects are served by the present attempt to get into the Common Market. For those reasons, I am hostile. I hope that sooner or later we shall repudiate the idea, and we shall then be free to move into a better and more peaceful world.

6.0 p.m.

LORD BURGH

My Lords, in rising to ask the indulgence of your Lordships' House, I should first like to thank my fellow"maiden ", the noble Lord opposite, for such a fine example in how to overcome trepidation, trepidation which I think is very natural in view of all the expert knowledge and political experience which is massed to-day and on the two days following for this debate. This is expert experience which I cannot hope to match. However, there are some rather general considerations which I feel are relevant and, indeed, important. I was encouraged by some of the things which the noble Lord, Lord Shepherd, said to think that perhaps these may be very important.

First of all, I think one has to recognise that European people from the Continent of Europe do not generally look on the United Kingdom as being really a part of Europe. I suppose that is because of our island position. Certainly, it is true that some nations or groups in Europe may feel more friendly towards us than towards other continental European groups or nations, and they may want to trade with us; but these friendly feelings are not quite the same as belonging to a group. To take an example, in Belgium there is friction between the Flemish and the Walloon communities; so much friction that there may well be many Flemish people who feel more friendly towards the English than towards the Walloons. However, when it comes to a question of who belongs to the family of Europeans, I think the Flemish would recognise the Walloon as perhaps a detested relative, whereas the English as pleasant outsiders. I think one finds that with all of the groups; whenever there is a group there is a counter-group which is excluded.

That is not to say that one cannot join a group. Of course that is possible, and one can become fully accepted, but that takes time. For a really united Europe, economic and political arrangements are not the whole story. Each nation in the group must have this feeling of belonging vis-à-vis each other. It is a question of people's attitudes. It is the attitudes, not analysed, which are formed over a long period of time and which begin to be instilled in childhood. These attitudes do not change overnight. At the same time, this feeling in Europe that we are really outsiders could carry with it an advantage, and I hope that it may turn out to be a very great advantage.

When an outsider is absorbed into a group, at the beginning he is generally allowed to have certain idiosyncrasies. When he first enters the group, these idiosyncrasies are tolerated for the time being. As he becomes fully absorbed, the group may recognise his idiosyncrasies as being useful and valuable to the group as a whole, so he is allowed to keep them and is even encouraged to develop them. Our idiosyncrasies on entering the European family is that we are involved in a very extensive network of cousins; if we enter Europe, we enter without severing our ties with the Commonwealth. I feel that that could be a vital contribution to international relationships, not just within the European Communities but on a world scale.

I am not looking at this in any way as the first step towards a World Government or anything like that. Centralisation on that scale in my view would be a terrifying idea. But it is coming to the point, I believe, where the survival of the world as we know it—the survival of the civilised world—may depend on finding a satisfactory way of integrating human activities, not just within one continent, but on a world-wide basis. In this case, I do not think that integration means universal homogeneous government; I think that is something that can be carried on between groups which are self-governing. That would include both developed and developing nations. I do not think I am being Utopian in feeling that in this combination of Europe and the Commonwealth we have at least the germ of a real world network of communication and co-ordination. Here I think communication is the key. It is hard to communicate with someone one looks upon as alien. If he is completely alien, communication is impossible. There must be a common ground, common assumptions, common aims and common attitudes. Here we come back to these attitudes of feelings which are not analysed, that an outsider is an outsider.

During the debates on the Industrial Relations Bill we heard of the problems which were caused by a lack of real communication. I think it was the noble Lord, Lord Brown, who spoke with great authority when he made the point that the most effective communication networks are precisely the informal ones; that is, communication between one individual and another individual who know each other rather than between points in the hierarchy or in the organisation. This is a matter of by-passing official channels and having a word with an old friend who works in a different part of the organisation, and it is often the best way to get things done. If we enter Europe, there is the opportunity to combine existing, informal communications within the Commonwealth with the communications that are arising within Europe and will arise between Europe and the United Kingdom. This is not something that would come immediately upon our entry into Europe. These informal relationships cannot be imposed by decree. They have to grow by themselves, but one can at least be aware of their value; one can nurture and encourage them.

If this informal network covering Europe and the Commonwealth comes into being, then it will be something entirely new, and new developments of this sort are usually traceable not to one single cause but rather to a certain climate of thought, to the appearance of different contributory factors in different areas. Perhaps one may take the analogy of scientific discovery. It often happens that the same discovery has been made quite independently by different people at almost the same time. The reason for that, presumably, is that a particular discipline involved has reached a certain stage where all the necessary ingredients for the new step were available and all that the discoverer has to do is to make a new combination of already existing elements.

In the case of the co-ordination of Europe and the Commonwealth, the essential ingredients seem to be ready. First, there is the growing political and economic integration of Europe. Secondly, there are existing Commonwealth ties, and I think the great virtue of those is that so many of them are informal ties; people have relations in different parts of the Commonwealth, they spend their time there, they have worked there and there is great freedom of movement between the different areas. The third ingredient is that there are individuals who will be suited to forming an informal network such as I have described. This network will have to cut across existing national and political boundaries.

The people I am speaking of are chiefly those—I think they are an increasing number—who are often described as"rootless ". This word is generally used in a derogatory way, but I feel it may become a praiseworthy characteristic. These are people who feel no permanent and exclusive attachment to a particular locality or area, even perhaps to a particular country. They do not feel bound by any particular ideology or social class. Their attachments and relationships which they regard as important are more between one individual and another, and their basis is probably rather diffuse. They get on together, they share common interests: they would not want to analyse it more deeply than that. This comes about perhaps because of the increased possibility of travel, the growing number of people moving around to find new jobs and settle in new places, and also the increasing similarity of cultural patterns in different countries.

In many ways this may not be a good thing—something may be lost—but at the same time I think it is bound to happen and it needs to happen in order that the networks may grow. Perhaps it is also a response to the accelerated rate of change in technology and life in general. For instance, in a river, if it is flowing slowly, plants which grow there can put their roots into the bottom and stay in one place, but if the river is flowing fast and the direction is changing, plants that move with the flow and take their nourishment directly from the water can survive more easily and certainly with more elegance. For the rootless—let us call them that—the present divisive group demarcation lines are weaker, and it may be that this puts them in a more favourable position to develop global networks of familiarity. This is really something that is the opposite of a militant nationalism.

My Lords, I admit that this is all rather speculative. If it comes about, it is not a process which can be directed with conscious purpose any more than a gardener can make a plant grow; but the gardener can allow the plant to grew or of course he can prevent it growing. I suggest, therefore, that if we decide to enter Europe—and I hope we shall—we should bear in mind the possibility of this developement and do what we can to provide favourable conditions for its growth.

6.14 p.m.

LORD THORNEYCROFT

My Lords, the debate has been graced by two distinguished maiden speeches, one by my noble friend Lord McFadzean and the other by the noble Lord, Lord Burgh, who has just resumed his seat. Both were in favour, broadly speaking, of a European adventure, but they approached it from very different angles. My noble friend Lord McFadzean, on the industrial side, referred to things which I propose to speak about a little myself, and the noble Lord, Lord Burgh, spoke from the point of view of human relations between growing world communities. May I say that we listened to his speech with interest and admiration. I think all of us in your Lordships' House hope that we shall hear him in the same vein on other occasions in other debates in our assembly. I rather wish that Lord Soper had stayed, instead of shooting his broadsides and then leaving the Chamber, because it seems to me that Lord Burgh might have told the noble Lord, Lord Soper, a few things about the nation-state which would have been very good for Lord Soper to have heard.

I should, however, like to make just a short reference to the speech of the noble Lord, Lord Soper, since it was the only one that has been delivered so far against the Common Market. I see that Lord Shinwell has occupied the place so recently vacated by the noble Lord, Lord Soper, and it is possible that we may be having another speech later on in the same vein. Lord Soper told us that joy and the quality of life and human happiness cannot be bought and sold in the marketplace, and I think we all go along with that. But to go on from that argument and to urge that we should not take such reasonable and honourable steps as we can to increase the prosperity of this nation seems to me a very odd deduction to draw.

The noble Lord, Lord Soper, talked about economics, and I suppose that a humble man like myself is therefore entitled to say a word or two about theology; but I am bound to say that a more Christian approach for any man who has seen, as most of us have in our lives, something of the suffering caused by human poverty or even by unemployment would he to urge that it was the bounden duty of men in public life to seek by all means within their power—by all honourable and sensible means—to enlarge our possibilities and increase our national prosperity. The noble Lord then went on to say that what we wanted was a World Government. I dare say we might want that, but to argue that we should not take some sensible precautions to have a few regional arrangements meanwhile is, I think, the epitome of making the best the enemy of the good.

That was the best speech, and indeed the only speech, that we have had against the Common Market so far. This has made the debate rather an awkward one in which to speak. Like some others in this House, I am accustomed to a more controversial atmosphere, but I will do my best. I think the main thing to try for in a debate such as this is brevity, and I will only say, as others have said, a little of what I know from my own experience. In the 1950s I was writing papers from the Board of Trade in favour of the European adventure, ably assisted by one of the greatest public servants we have ever had, Sir Frank Lee, whose recent death as Master of Corpus Christi we all deeply regret.

LORD BOOTHBY

My Lords, I hope the noble Lord will forgive my interrupting him. I wonder if he would say whether the Foreign Office were at the same time writing the same kind of papers?

LORD THORNEYCROFT

My Lords, I was coming to that. I do not want to be rushed in any way because I wish to make very careful observations about this matter. As I say, at that time I was writing papers in favour of the Common Market and I played such part as I could during the years in advocating those causes. As I think the noble Lord, Lord Boothby, knows, I have been a consistent supporter of them. To-day I am an industrialist, working within the orbit of two great European companies—the Pirelli/Dunlop group on the one hand and the great Philips organisation on the other; that great electronic giant from Holland, and I think the largest electronic company in Europe. Therefore I have some experience of these matters from various directions. After twenty years' experience of that kind I would say this—and here I go a little towards Lord Shepherd—I do not believe you can prove this by figures. It is too complicated and the variants are too great. At the end of the day you have, with all the experience you have gained, to take a deep breath and make a judgment. It is a matter of faith rather than of figures, and because it is a matter of faith it is a matter upon which honourable men can hold different opinions. That I would frankly admit. When we debate to-night, we debate the future and not the past. I really am not particularly interested in what Mr. Wilson did or did not say. Everybody has said things a bit differently at one time from what he has said another time. I do not think it is very important.

If I did look to the past, I would look beyond Mr. Wilson; I would look to the time when Winston Churchill was the leader of this country, when we had just finished a great war, when a marriage of affection—as Lord Boothby put it—could have taken effect. I think the historians, when they write, will not ask what Mr. Wilson said; they will ask how it came that Winston Churchill, with all those powers, with all that position, with all the reputation that Britain had, did not do this. There I must confess the Foreign Office had something to do with it—I would agree with that. At the end of that period, after a great war, Winston was tired, unable to fight the opposition which was against him. I remember David Lloyd George once saying to me,"You can pity any man who is a Prime Minister in peace time after winning a great war. His whole strength has been drained from him in this one great effort." There is no doubt that at that time the Foreign Office were opposed. The noble Lord, Lord Sherfield, said that for some period of his life he was on the fence. He had done extremely well to get as far as the fence. Most of his friends were on the barricades during the greater part of the time that I played any part in this matter. I hope I have answered the noble Lord, Lord Boothby.

LORD BOOTHBY

Yes, you have. Thank you.

LORD GORE-BOOTH

May I ask the noble Lord one question on behalf of the much beleagured Foreign Office? Would he not agree that all in the latter part of the 'fifties Departments were, in fact, bound by the policy of the then Government to attempt a European free trade area? I want to get that period straight.

LORD THORNEYCROFT

I do not think that has anything to do with it at all. The period I am talking on is over twenty years, and I am bound to say that I was there. I am not writing any memoirs, but I think that I am entitled to say occasionally what I know to be a fact. I was there during that period. I know where everybody stood. I can see quite a few people in this House. I am not going to go through their names, but I know exactly where everybody stood during those days. There is no doubt about it. When the history comes to be written, it will be seen that the Foreign Office, originally under Anthony Eden, were opposed to the European Market. They stuck to that view for a long time.

LORD BOOTHBY

Under the leadership of the Secretary of State for Foreign Affairs. Sir Anthony Eden was passionately opposed to anything beyond a vague association with Europe, and repeatedly said so.

LORD THORNEYCROFT

This debate is about the future, not about the past, and I should like to get on with that.

To-day we are at last discussing the question of principle, and, thanks to Geoffrey Rippon, the Chancellor of the Duchy, we have got it out of the aura of butter and fish—although I must say that I enjoy Lord Boothby's speeches. He brought back nostalgic memories. He speaks so well on Europe. There is only one subject on which he speaks better, and that is white fish. To have an issue where he can bring those two themes together is a joy for all of us to listen to. But we have got the issue out of the atmosphere of butter and fish. I would also say this to noble Lords opposite. I do not want to increase their embarrassment in any way, but it is difficult to go on arguing about the terms when Minister after Minister, not only in this Government but also in previous Governments, are all saying that these are the right terms; these are terms, which they would have recommended.

There is another habit we might get out of. Do not let us keep on saying that we cannot enter because we do not like this Government. Anybody is entitled not to like a Government, but I can say one thing without fear of contradition: during the years we are in the Common Market we are going to have much worst Governments than this. We have to live with it. We have to take the rough with the smooth. The most astonishing men in the history of the years to come will, from time to time, be governing England. If we think we can be in the Common Market only with a superb Government, with something tremendous, with a unique leadership at the top of it, we are in error. We shall have to get on with it with much rougher conditions than that. If we think otherwise, we had perhaps better not go into the Common Market. But, in point of fact, we cannot make an excuse either of the Government or its leaders, or of the economic situation. We shall be in much worse economic circumstances than these. One noble Lord has already said that from the point of view of economic circumstances this is rather a good period in which to enter.

What do we want? Do we want to get in or do we want to stay out? I remember the noble Lord, Lord Caccia, who will speak in a moment, saying that there was a lot of room between Sydney and the Bush. Well, the distance between Sydney and the Bush is narrowing at the moment. We are going to have to make a decision one way or the other, whether we are for it or against it. I personally am for it. In the process it is important only that we should not tear ourselves to pieces too much in going in. This is, and must be, a national decision. The worst thing we could achieve in a way is for this decision to be made to look like a Party decision. We shall need all the men of talent in this country, on all sides, to make the best of our position in the Common Market. Many of those who oppose it to-day, whether it is Mr. Callaghan, Mr. Wilson or Mr. Enoch Powell, in the years to come will probably have to make a very big contribution to our affairs and to the ability of this country to conduct itself in a satisfactory and worthy way.

So let the debate take place, but do not let us create divisions among ourselves which are too lasting or too deep. If I may say so, I think it would he a pity if the Labour Party pulled itself to pieces on this subject. It is not for me to advise the Labour Party, but it would be a great loss to this country if the Labour Party suffered serious damage. In this House we are entitled to look at the matter in a certain perspective. To me it does not seem necessary for the Labour Party to have to say,"We are for it"or"against it ". They are perfectly entitled to say that they would have done better, or that their terms would have been better, or the economy stronger, or that they would have conducted themselves with more skill. Everybody knows that they have very able men on both sides in that Party, and I see absolutely no reason why those men should not express their own views or vote in their own way without its in any way being held against them or the Labour Party in the process. Whatever can be done should be done. I do not know about the Whipping. The public do not understand Whipping anyway. They do not know what it is all about. In fact, the Tory Party when in Opposition Whipped Conservatives in favour of the Labour Party when they wanted to open these discussions. They were entitled to take a firm line here. But any steps which can be taken to make this a national decision, to minimise the Party differences and to make it easy even for those men who oppose it at the present time to play their full part in this great affair when we go in, should be taken if at all possible.

Just a few words now on the industrial side, which will really conclude what I want to say. Only on the industrial side am I now qualified to speak. This is a mixture of pluses and minuses. Only those intimately concerned with a particular business could say, even today, whether they were likely to do well or ill. It is a matter of a very fine and difficult judgment. Here I would agree with Lord Shepherd. The figures do not really matter. It is a matter of faith, whether you think you can make the most of the opportunities which are presented to you. I think it is true that in this new world which will be presented to us both the prizes and the penalties will be greater. If we are really good, if we really seize our opportunities, we shall do very well indeed. But if our management is weak, or bad, we shall pay a much higher price for our failures. That is a risk that we take, but it is also an opportunity which is offered to us. The fact is that industry today wants to go into the Common Market; having made all their judgments and weighed all the risks, they want to go in. The onus is heavily upon those who urge that in the face of those wishes they ought to be kept out. I can conceive that some argument can be made for that, some overwhelming case for some particular point, but it has not been made in this House, nor, so far as I can judge, in any other respect of the negotiations outside this House.

If I may summarise the advantages as I see them, the first is that we have free access to large and growing markets. This is a great prize for big firms. But as the noble Lord, Lord Sherfield said, it is also a big prize for small firms. If you look at what has happened inside the Common Market, on the evidence not of theory but what has actually happened, the small firms have had as big as, or greater an opportunity and benefit than, even the larger ones. That is the first advantage, and it is a great one.

There is also the increased rate of growth to which we shall be geared. The rate of growth is of great importance to any industry. My noble friend Lord McFadzean and I are competitors in the cable business. Both of us would say that the rate of growth of cable sales is almost directly geared to the rate of growth of the gross domestic product. Think what that means to the thousands of men who work in British Insulated Callender's Cables, or any of the other great cable companies of this country. Those are the real prizes; they are not just restricted to profits. Everybody concerned in industry could benefit, and we are looking at these benefits when we advocate entry.

Thirdly, we would enter a common industrial environment. The difficulties to-day of making an arrangement between great firms in Europe, such as Pirelli/Dunlop, are almost insuperable. Vast cost is involved; there are the complications of tax laws, of capital gains tax at different rates in different countries. To get any sensible arrangement between two firms in Europe on the matter of pricing would deter any but the very greatest organisation. If we can build up a common industrial environment, we can start to organise ourselves and rationalise things on rather a better basis.

We shall be able to share the cost of research and development, which is very high indeed, in the advanced technological fields. In many cases, although not everywhere (because it is not true everywhere) there are advantages of scale. We would have a basis for competition in third countries. I attach almost as much importance to that as to the opportunity in Europe. To try and compete with Europe in third countries from a narrow island base just off it is not a beguiling prospect for anybody likely to engage upon it. There will be some increased specialisation; there will be new sources of capital and, above all, we will be able to play a part, which we shall not be able to play otherwise, in shaping the industrial policies and strategies of the world scene through great organisations like the General Agreement on Tariffs and Trade. We shall play no big part on the sidelines, but it is vitally important to industry in this country that we should play a major part, and exercise a major influence in world affairs.

These arguments, to me, are compelling; I know of no alternative that can be offered to the industrial scene in this country which gives anything approaching this as an opportunity—no other combination, no other chance. It would be astonishing if, after Governments for about fifteen years have been struggling to get this prize, we were suddenly at this moment to reject it. The world would be astonished at that decision. I know the bitter disappointment that would be felt by people who work in the great enterprises in these countries if they saw these prizes rejected. There are also disadvantages, too, but we believe that we have the wit, the skill and the ability to take advantage of the prizes. At best we could get into a Europe which was powerful, peaceful and outward-looking and which exercised a great influence in the culture and peace of the world. We may fail with that; it may not turn out that way. But there is no chance of its turning out that way for us unless we are in the Community and can play a part in it. Faced with these matters, my Lords, I cannot believe that we should turn our backs upon what I believe must be the larger vision and the brighter hope.

6.36 p.m.

LORD CHORLEY

My Lords, the noble Lord, Lord Thorneycroft, is a particularly difficult speaker to follow. I agree with him in wishing to support the congratulations which he extended to the two maiden speakers. I enjoyed their speeches enormously. They were of very different types. They struck me as being of exceptional interest, and I fully echo what the noble Lord, Lord Thorneycroft, said about hoping that we may hear from them again in the not too distant future.

I had some difficulty in deciding how to intervene in this debate with this long list of speakers. Obviously, as other speakers have said, this is a debate about one of the most important matters that has come before Parliament for a very long time—certainly since the date in 1939 when Parliament decided to pick up the glove so insolently thrown down by Hitler, and did so as a united nation. On such an important occasion, it is one's duty to make one's position clear in regard to a matter of this kind. In 1939 we took action as a united nation; the most lamentable thing about recent events has been the way that a large section of the Labour Party, after going right up almost to the last moment, have now in effect gone back on what they did, as my noble friend Lord George-Brown explained to us. I feel very much with the noble Lord, Lord Thorneycroft, when he asks what the world will think about this; about the way we have behaved. It fills me with a sense of shame and even dishonour that this should have happened when it looked as if we would be going into Europe as a united nation. This has happened because we lack the leadership which we need at this crucial point in our history.

Mr. Roy Jenkins, in an admirable speech in the other place, asked us to confine ourselves to the issues before Parliament, and not take to personalities. That was magnanimous advice from him, but I am afraid that I cannot accept it. Politics is largely a matter of personalities and Mr. Jenkins—perhaps the best of our political biographers—has made that clear in some of his outstanding works. The average man does not think his way to his political decisions; he feels his way. And his feelings are very largely dominated by his leaders. One has only to see what happens in the great trade unions to realise how true that is. My feeling is that over these last months the leadership is not what it ought to have been. This kind of interaction of the personality and the ordinary man is bound to go on taking place as long as we have a democratic Government. It always has been so; it always will be so.

During this crisis, my mind has gone back to the Brighton Conference of the Labour Party (which Mr. Jenkins himself was writing about in The Times not long ago) in 1935, when Ernest Bevin overthrew the Leader of the Labour Party at that time, George Lansbury. There was no question about it. He had come to the conclusion that the pacifist policy which Lansbury had been following was no longer safe for this country, and in a massive speech he completely turned the feelings of that great audience. This was a great exhibition of leadership and just shows what can he done by a great leader in circumstances of that kind. And, of course, Ernest Bevin knew perfectly well that what he was doing would disunite the Labour Party, as to a large extent it did, for a time, but he also realised perfectly well that the safety of the country depended on the overthrow of the pacifist policy. It was his work and we owed it to him.

It is a great pity that we have not been able to keep ourselves united in that kind of way under the leadership of Mr. Wilson. When the noble Lord, Lord Thorneycroft, says that he does not attach much importance to what Mr. Wilson is saying, I am afraid I disagree with him completely because if Mr. Wilson had only given the leadership that we needed, had only stuck to the principles which he enunciated in his great speech in May, 1967, quite obviously the country would have come round behind him. During all these negotiations undoubtedly there has grown up among a vast part of the generality of the people a feeling of lassitude, even of discontent; and as the opinion polls have shown there has been great disagreement. This is the time when leadership is needed. As people are beginning to realise what is involved, feeling of that kind is tending to pass away. It is quite impossible to believe that Mr. Wilson is still holding the same views as he put forward before the House of Commons in 1967. My noble friend Lord George-Brown has told us; Mr. Michael Stewart has told us; Mr. Thomson has told us. And if we had not had all this evidence from all these people who are right in the thick of it we should be bound to reach the same conclusion from a careful perusal of Mr. Wilson's own speech in May, 1967, to which I have referred. This makes it quite vital that we should in fact subject his present views to a free and frank scrutiny because he has, in my view and the view of many other people who are beginning to lose confidence in his judgment about these matters, completely changed his position. A careful reading of his speech in May, 1967, amply bears that out. Really, no other deduction can be made from it.

Of course, Mr. Wilson is motivated by anxieties not to split his Party; that is perfectly understandable. Ernest Bevin must have been very worried by feelings of the same kind. It is understandable and indeed laudable that to preserve unity one should sink one's feelings, provided that they are not in relation to something which is vital to the country's interest. I find it very difficult to believe that in 1967 Mr. Wilson did not believe that our entry into the Common Market was a subject of vital importance. I find it very difficult to believe that that was not the view of the Cabinet at that time.

LORD DAVIES OF LEEK

My Lords, will the noble Lord give way for one moment? I happened to be present at the 1935 Conference and I happened to be present in another place when it was decided by the private Parliamentary Meeting of the Labour Party that we should go in and negotiate. It was a vote of the Party upstairs in another place that gave authority both to Mr. Wilson and to Mr. Brown (as he then was) to negotiate on behalf of the Party. It does not help to keep mentioning one man, because those of us who may also be against are, I hope, against constructively and are willing to have our minds changed if it is at all possible.

SEVERAL NOBLE LORDS

Order!

LORD CHORLEY

My Lords, I do no, think that what the noble Lord has just said has in any way altered the view which I was attempting to put before your Lordships. Quite obviously, Lord George-Brown has told us this afternoon what his impression of the situation was. Mr. Wilson's speech in May 1967 was really a splendid plea for the European Community—a more convincing argument in many ways than the White Paper itself; it might well have paid the Government to circulate it as part of the information material which they have been issuing over these past weeks. Now it is quite clear that Mr. Wilson is taking up a different position and is contending in almost every speech he makes that the proposals in the present White Paper are quite unacceptable. Yet in his 1967 speech almost every one of these points was taken up and discussed by him, and he and my noble friend Lord George-Brown were going in as realists to attempt to negotiate our entry into the European Community at that time.

So far as I can find, there is only one passage in the 1967 speech in which Mr. Wilson indicated any kind of hostile feeling or statement that unreasonable proposals were being put before him, and that was in regard to the financial side of the question which he described, it is quite true, as"inequitable and unfair ". In recent speeches he has been using very strong adjectives, such as"too penal,"too impossible"or"too unjust ". But these proposals now are, as almost every speaker this afternoon has pointed out, more favourable than the ones which were being negotiated by Mr. Wilson and Mr. George Brown (as he then was) when they visited all the capitals of the Community States. They were asking to enter. They were there, in effect, trying to obtain entrance into an important club.

When you are negotiating in that sort of way you have to play your cards carefully and not expect that you are going to get 100 per cent. of what you are asking for. That was the attitude which was taken at that time, but it is not the attitude which is taken now, and I personally find this deplorable. It seems to me essential that we should complete these negotiations and enter the European Community as quickly as possible. It seems to me that the terms which have been offered are, in all the circumstances, very reasonable terms. There are certain aspects, particularly with regard to the agricultural policy, which nobody in this country likes, but when the negotiations started that was perfectly well known, and the negotiations were taken up, so to speak, on the basis that such was the case. It seems to me now that to turn round and take this quite different attitude is completely indefensible.

In this debate we have heard some pertinent and valuable remarks about the value of going into the European Community, and I do not want to go over all that ground again. It should be clear to everybody that over the last 10 years, economically, we have made very little progress, if any at all, in this country. Both Parties have been in power for pretty well equal periods during that time, and even at the end of that time there is a malaise in our economy which shows that something is wrong. It seems to me that our industry is not sufficiently broad based, and the only way of getting it on to a sufficiently broad base would be to go into the European Community, which after all is possibly the greatest of the free trade areas in the world. EFTA has been mentioned, but that is not the same in any sort of way as the European Community.

In the 19th century we were the leading industrial power in the world. That was partly because the Industrial Revolution had taken place in this country, but also because to a large extent at that time we had the world as a free trade area, and as long as that was so we were the dominant industrial power. These large areas of free trade are obviously extremely valuable. I do not think the importance of this has been sufficiently stressed. Why is the United States of America so tremendously powerful industrially? Why is the U.S.S.R. so tremen dously powerful industrially? Because they have these enormous free trade areas, and it seems to me that the sooner we get into the European Community free trade area the better. Mr. Wilson himself stressed vividly in his 1967 speech that there were over 300 million people, with all the know-how and the build-up which has been described so eloquently by various speakers this afternoon.

The sands of time are running out for us, and we must make up our minds quickly and get on with the job. I have always taken the view that the political side of it, which the noble Lord, Lord Soper, regards with even more distaste than the economic side, is the more important and the more valuable. It has been dealt with so successfully by the noble Lord, Lord Boothby, and other speakers this afternoon that I will not take up your Lordships' time by going over the material which I have prepared about that side of it. Obviously the European Community itself is on the verge of considerable developments which, in my view, have not been really sufficiently stressed during this debate, and if these developments take place our position will be even more difficult than it has been in recent years if we are outside. We really just cannot afford to be outside at the present time.

As I have said the sands of time are running out and it is for us to take what is almost certainly the last opportunity that we shall have of getting into the European Community. I emphasise that this is a European Community and not just a Common Market. Too often it is thought of in this country merely in mercantile or shopkeeper terms. I suppose we are at heart still a nation of shopkeepers, but this is very much more than just a Common Market. It is a great community, with all the openings which a great community has for civilised life. So I say to your Lordships that we must not hesitate, we must go ahead There is a tide in the affairs of men, Which, taken at the flood, leads on to fortune; Omitted, all the voyage of their life Is bound in shallows and in miseries. On such a full sea are we now afloat; And we must take the current when it serves, Or lose our ventures.

6.57 p.m.

LORD TEYNHAM

My Lords, I welcome the speech of the noble Lord, Lord Chorley, in many respects, and I should like to begin by saying that my approach to the Motion before the House is one of acceptance of the principles of the Common Market. In fact, many years ago, in the absence of Sir Anthony Eden (as he then was) I led the first Parliamentary delegation of both Houses of Parliament to Paris for the formation of the Western European Union organisation. Also, up to a few years ago I was for a number of years a delegate to NATO, so I must confess that I am biased in the European Community outlook. In my view, to stay out of Europe would be a political blunder of the first magnitude, and our children and grandchildren would never forgive us if we did. I entirely disagree with the noble Lord, Lord Soper, in his remarks about the balance of power. I would go so far as to say that if we had been more closely linked with Europe, and if the countries of Europe had been more closely linked with each other, the course of history might well have been changed without two disastrous wars.

We must be careful to remember that France is no longer a member of NATO, and our acceptance of the Treaty of Rome will not increase our security unless we can convince France that for the security of Europe she should return to the fold of NATO. I think this is a most important matter with which we must deal inside the Common Market. There is no doubt that one day the United States of America may considerably reduce her forces in Europe. We must be prepared for that day, and the closer we are linked to Europe the stronger will our security become.

I should like now to deal for a few minutes with economic affairs. I think it is true to say that three years ago the standard of living in Europe was lower than that in this country, but now the position is quite reversed. Some of your Lordships will remember that a few weeks ago an enterprising newspaper sponsored the visit of an average working-class family in this country to one of the countries of the Economic Community, and arranged for them to stay there for a period. On their return they reported that the standard of living was higher than here, taking wage for wage. Some of your Lordships may say, and feel, that this was merely a trumped-up piece of propaganda, but I suggest that any who take that view should try to prove it. It is of course true that a great many people in this country are nervous about the increase in food prices which may occur within the Common Market, and I hope that the Minister who is to reply for Her Majesty's Government will deal with this matter as fully as possible.

Many of us, I would say, have been worried about the position of New Zealand. I am personally quite satisfied with the arrangements that have been made for that country, and I believe that she is getting a fair deal. I think it is true to say that many people in New Zealand—a country I have visited—in some respects welcome the Common Market. Why do they take this view? Because they feel that it will give a greater impetus to that country to branch out into other fields of endeavour and not concentrate on dairy products almost to the exclusion of industry. Some of your Lordships who have long memories will look back to the days when Chile was a prosperous country which had a good exchange rate with sterling. Unfortunately for Chile, the economy was largely based on nitrate, which was easily mined or dug out of the surface, and sold to Europe as a first-class fertiliser. Then the First World War came along, and in a short time the Germans began to produce synthetic nitrate. As a result, in a comparatively few years the economy of Chile was almost ruined and it has never really recovered from that even to-day. I spent nearly four years in that country and saw it all happen around me. I certainly would not attempt to suggest to New Zealand how she should conduct her affairs, but I do suggest that the example I have mentioned is a grim warning.

I must say that I am worried about certain aspects of the Immigration Bill, which is going through your Lordships' House, as it will apply if and when we go into the Common Market. I am sure that a great many people in this country will feel the same—they will at least be very disturbed—if, for instance, a German is able to come to this country freely under Common Market rules but an Australian or New Zealander is to be discriminated against on the question of entry. We certainly cannot be put in the position of treating Australians, New Zealanders or Canadians as aliens while Community members are allowed to come over here freely. I should like to ask Her Majesty's Government what they propose to do about this inequality. I have no doubt that if we had been able to enter the Common Market in the early 'sixties and not been rebuffed by the great General de Gaulle, we would be a great deal better off and more prosperous, with a higher standard of living than we have to-day. There are, of course, many exponents of the idea building up an Atlantic Free Trade Area and keeping ourselves free from Europe. But I maintain that this idea is not possible; it would not be accepted by the United States, and certainly would not be accepted by Canada.

The noble Lord, Lord Boothby, has raised the question of possible destruction of the breeding grounds of fish off some coasts of our country unless an agreement for their protection is made by the Common Market. I would entirely accept the views of the noble Lord, Lord Boothby, but I must remind him that deep-sea fishing rights are also very important. We have recently heard that Iceland is claiming a 50-mile limit for her own fishing rights; and Norway, I believe, wants a new agreement. I hope it may be possible to get an agreement on all these fishing matters before we enter the Common Market. Perhaps the Minister who is to reply will deal with that point. My Lords, I would conclude by saying that I have no doubt that if we remain out of Europe and try to"go it alone"we shall gradually become poorer and poorer. What we are really going to do is to join what might well be called a mutual aid society, not only for commerce but also for security. I welcome the Motion before the House.

7.5 p.m.

BARONESS BIRK

My Lords, may I first add my congratulations to the two noble Lords who have made their maiden speeches to-day. In the mid-1950s, as a young aspiring candidate for another place, I went to Luxembourg on a delegation to visit the Coal and Steel Community. It was then that, quite out of the blue, I felt gripped with the whole idea of Europe and with the spirit of Europeanism which seemed to me to rise well above the technologies of the Coal and Steel Community. I realised then that those countries had accepted that if their talent and experience was to make its contribution to world affairs and to protect their own legitimate interests in the political, economic and monetary fields, they would have to maintain and develop institutions of unity far greater than anything that had been achieved in the pre-war period. I then realised for the first time that our situation was basically the same. Indeed, I came back feeling that we were almost too late at that time, and during the years of stalemate my enthusiasm waned, like that of many other people; but once a real opportunity arose for us to go into Europe, again my enthusiasm increased, for I really believe that only by joining with the Continental countries can we make our vital contribution to world affairs.

If Europe continues, now, as I hope, with our help, to develop this co-operation on a regional basis, she will be able to play a part in furthering prosperity and peace on a world scale. I find it difficult to go along with those who believe that there is more safety in the perpetuation of the nation State. I feel that every time we can break down that sort of barrier we take a step towards the prospect of greater world peace; for I believe that the nation States, the small States, with access to the weapons that there are around today, are a very real danger to world peace. And by joining together we are not losing our identity. When we look at the countries in Europe, they have all preserved and kept their own identity and their way of life. One of the things that has struck me is the fear of those who are against our going into the Market and who, I believe, underestimate what we have to contribute. One side is what it is going to cost us and what benefits we are going to get. The other, and equally important if not more important, side is what we can contribute to the Community.

First, I think, is our influence, which we cannot ignore and which often appears to be generally very under-stated. Then there is our whole way of life which we should be taking with us; and here we have a great deal to offer and a great deal to be proud of. Many people I know in the communications field—in Press and broadcasting—in Europe very much envy our institutions, our freedoms. I do not believe that we are going to lose those, but I do believe that we shall be able to influence others to accept some of the freedoms that we value so much. The Social Democrats in Europe badly want us in, which seems to me, as a member of the Labour Party, another added reason for our going in as quickly as we can. We have to remember that they felt many of the fears, anxieties and concern that are felt very legitimately by most of us, but they found that, on balance, the pros outweighed the cons and that the advantages of being part of the European Community were very great.

I do not want to deal with the economic side, because so many people have dealt with it and there are others far better qualified to do so than I. If we do not go in what are the political alternatives? Do we go even further under the trans-Atlantic blanket? I do not think any of us want to see that. The other alternative is to"go it alone ", which would mean that we should have no influence over major events in the world and should certainly not be able to contribute towards formulating a real peace between Eastern and Western Europe, which I feel is one of the great points about our going into Europe.

It is not only the terms that are important. What also matters is how the different problems are dealt with as they arise, and it must be pointed out that the Government have not yet given any clear analysis of how they see the economic situation developing as we go in, and after. I think we are entitled—even those of us who want to go into the Market—to ask the Government for more information on both the economic and the political sides. We have only this month heard the news that unemployment in this country has reached the astronomical number of nearly 830,000. This must make us look critically at the Government's economic and social performance at home. We have to do this, because what is done at home is relevant to what will happen once we go into Europe. Of course I hope that by then we shall have a Labour Government. Whatever we do, there is a chance to be taken, but that is the case with most deci sions, certainly the big ones, in life. That is the case with marriage but, though the divorce rate may be high, the majority of marriages still succeed.

However, what I feel is the most important factor—more important, even, than the problems of New Zealand butter or of sugar, because next year there will be different problems—is the future and the young people. It is interesting that we have seen no protests against Europe from young people, no sit-ins, no demonstrations of xenophobia. They accept naturally the words"abroad"and"foreigners ". Maybe this is because school children and students have had more opportunities to travel than their parents had. For young people more than for anybody, a decision by Britain to refuse to play her part in the great European co-operative enterprise will be frustrating and bewildering. I believe they find the international rat-race repulsive, and see hope, prospect and scope for idealism in the growing sense of world interdependence. They want our country to play its part. And so do I.

7.13 p.m.

LORD BETHELL

My Lords, like other speakers, I should like to congratulate the two maiden speakers this afternoon, my noble friend Lord McFadzean and the noble Lord, Lord Burgh. They were extremely lucky to have such a subject on which to make their political debut. This is really a world-shattering moment, and it is superb to be able to speak in a debate such as this when one begins one's political speech-making. I was very moved when my noble friend Lord Carrington spoke about the problem of accurate prophecy in diplomacy and foreign policy. He outlined for us, in a very clear and poignant way, the problem of his generation when they had fought the war and, at the end of it, found themselves living in a Europe which was devastated and seemingly unwooable by the countries which had won it—Great Britain, in particular. Why should we align ourselves with Germany who had just fought us so viciously, and with France which had been defeated? It seemed incredible that we could make such a choice when offered the alternative of a special relationship with the United States of America and with a British Empire which people must have thought was going to continue for a long time to come.

It is one of the differences between my noble friend's generation and that of the noble Lord, Lord Burgh, and myself, who were children during the war and in the years which immediately followed it, that we feel differently about this issue. The pride in our achievement as an imperial Power is outside our own personal adult experience. It is for us a matter of historical study, and the balance between what was good and what was bad in our imperial years seems a matter of analysis to those of our age, rather than a matter of emotion as it does to those who experienced them. This is why it is easier for the young to accept with excitement, and without nostalgia and despondency, the idea of giving up our really close ties with our former colonies, and moving ahead instead into a Europe which I hope will provide us with our future, and will provide the world with a body which will be extremely important and, in effect, a super-Power.

The noble Lord, Lord Burgh, said—and I thought it was a good phrase—that he hoped that this enlarged Community would become the germ of a common network of communication. This idea is something which I would commend to your Lordships. It is like a spider's web, with all the countries which formerly had empires coming together, but at the same time having threads going out towards the countries with which they were connected, so forming a greater unity to which I am sure the world is moving. There was a note of nostalgia for the past in the speech of the noble Lord, Lord Shepherd. He mentioned in particular his fear of Europe becoming inward-looking. I do not see very many grounds for such fears. So far as I can see, Europe has historically been the most outward-looking part of the world. The United States of America, for example, consists almost entirely of Europeans who have been outward-looking.

One of the problems of the world is the isolationism of the super-Powers. At the moment the United States is having what one might call a nervous breakdown, and turning herself into a fortress in the face of her sufferings in Vietnam. China, in spite of her recent initiatives, is still cut off from the rest of the world and from world culture. And, although Russia has taken certain steps towards joining with other countries, particularly in scientific progress, she still seems determined to keep herself clear of ideological con-troversy. I can only think that the reason for that is that the Soviet leaders are frightened of ideas which might subvert their people and undermine their own authority.

That brings me to what the noble Lord, Lord Shepherd, called his vision of a united Europe. There were even some cries of"Hear, hear"from the Benches opposite, when he spoke of his vision of a united Europe, East and West. Of course that is the vision not only of Members of your Lordships' House, but also of both sides of the Iron Curtain. The question is: on whose terms do we have this unity? It was the vision of Marx and Lenin, but of course we in this country would reject unity on those terms. If we are to achieve any sort of unity between the East and the West of Europe it seems to me essential that we in the West should unite, in order to move towards the sort of vision which the noble Lord, Lord Shepherd, had in mind from a position of strength. How can we get a unity on any terms approaching our own other than from a position of strength?

LORD SHEPHERD

My Lords, may I intervene, merely to say that I entirely agree with what the noble Lord is saying.

LORD BETHELL

My Lords, I am very grateful to the noble Lord. I only mention this matter because I am aware of the very strong feelings that have been expressed in Eastern Europe and on the far Left in Western European countries against our joining the Economic Community, and against the enlargement of it. I often ask myself,"Why do they feel so strongly about it?"There are, I know, members of the Labour Party on the Left Wing who feel very strongly that it would be disastrous for us to go in, and I can see their reasoning given the fact that they are Socialists of a more doctrinaire sort than perhaps one sees on the Front Bench opposite. A rigidly planned economy will be less feasible once we are economically independent with Western Europe.

The far Left hardly ever has a share in a Party of Government in Western Europe. In the Social Democratic Party of Germany one does not find Socialists of the far Left. This must be a genuine problem for the Opposition Party, and my only comment on it is to wish well, and to take no political advantage of, those members of it who support our entry into Europe, since this problem is one which I hope will transcend Party differences, and is certainly much more important than them.

I know there are others in this country—and I will waste only a few words on them—who are opposed to our joining the Western European Community simply because they fear that a Ten rather than a Six will make Western Europe stronger. I can see no reason why the Communist bloc and the Communist Parties of Western Europe oppose our joining—of course they do not all do so, but some of them do—other than because they fear that it will make Western Europe stronger, and naturally this would be against their own Party interests. Furthermore, the prosperity which the E.E.C. has created in Western Europe shows up the comparable movement forward in the Soviet Union, Poland, Czechoslovakia, Hungary and other reasonably developed countries of Eastern Europe. It must be very galling to them to see the tremendous strides forward which have been made in Germany, France, Italy and Holland since the Six were created. It must in fact be a source of fear because this economic development, this prosperity, becomes known across the Iron Curtain. There is no iron curtain when it comes to information these days. No wonder they oppose its extension, and are frightened of a situation in which they would find themselves growing comparatively poorer.

In the meantime, will our relations with Eastern Europe suffer? One is told, if one reads the Press of those countries, that if we ally ourselves with France, Germany, Italy and Holland we shall jeopardise the strides that we have made towards friendship with the Soviet Union, Poland, Hungary and Czechoslovakia. I see no grounds for such fears. Has France had any difficulty in developing her relations with the East since she became a founder member of the Six? I did not notice de Gaulle hamstrung by his connection with other countries when he was making approaches to the Soviet leaders and to Poland. Two years ago did Willy Brandt find himself in a difficulty because of his connections with other countries when he launched his Ostpolitik, and when he concluded treaties with Poland and the Soviet Union? These have succeeded to a remarkable extent in relaxing tension in Europe, and Willy Brandt has achieved something which I think is grossly underestimated in this country.

The noble Lord, Lord George-Brown, I thought, put the point very well when he said that the question of sovereignty really does not arise. We shall give up no more than we have to once we join. If we only achieve an economic unity and make no further step towards unity, it will still be worth joining. But if we are called upon to move towards a closer unity, there should be no question of our giving up any sovereignty unless it is in our interests to do so, and the noble Lord feels that no leader in the Six would expect us to do so unless it was in our interests. If we find that it is in all our interests to achieve a closer political unity, we shall find that our membership reinforces our ability to promote our present national interests, particularly in the face of the Eastern bloc, which is more powerful.

My last point is an emotional one, and a fairly simple one. For 10 years, ever since I was a university leaver, I recall that we have tried to make efforts to join the E.E.C. It has for a long time been the idea behind successive Governments. Now, at last, we have the chance to do so, and, to my amazement, I find that there are large numbers of people in Parliament—not many of them in this House, I am glad to say, and not many of them in my Party—who oppose it, in spite of these years and years of trying and of being turned down. Now, when we are on the point of success, we are confronted with people who are rejecting the idea for reasons that seem to be connected with something that happened last year, or something that happened last month; last month's trade figures; last month's unemployment figures; who won the last Election; little things like that. If we do not go in we shall be the laughing stock of the world.

I recall watching the Labour Party conference on television a few days ago. There were Social Democrat delegates there who could not believe their ears when, after the years of working together with the Labour Party leaders, and supporting our entry into Europe, they suddenly found that prominent members of that Party were opposing it on points which seem trivial. It is simply a question of taking a deep breath, and looking at the vision of what we are to do with our future, rather than the short-term view of what is happening this year. All I can say to your Lordships, in conclusion, is that we cannot stay all on our own in face of a world which is fitting itself together, in spite of us. The Common Market is not going to go away if we do not go in. It will continue, and we shall find ourselves, once the world has fitted itself together, as a piece of a jigsaw puzzle suddenly stuck out on one side forming no part of anything. As my noble friend Lord Carrington put it, we shall then be in for a gradual and steady decline.

7.30 p.m.

BARONESS EMMET OF AMBERLEY

My Lords, I should like to start by congratulating the two maiden speakers, who added a great deal to the interesting speeches we have had to-day. In August, 1914, Sir Edward Grey said: The lamps are going out all over Europe; we shall not see them lit again in our lifetime. Nor did he see them again in his lifetime. For the few minutes I would keep your Lordships, I am not going to speak about bread and cheese or about economics—though, of course, they are immensely important. If ever there was a time when man cannot live by bread alone, this is the moment, when we ought to be looking beyond the obvious material things to something more important in the value of living survival.

I turned up"Europe"in the Encyclopædia Brittanica. I was curious to know where the name had come from and I found that according to Homer, Aeschylus and the Phoenicians, there arose, I suppose among the maritime nations in the Mediterranean, a label for Asia,"As-land"or the Land of the Rising Sun, and for the lands to the West and North, the name was"Erip"or the Land of Darkness, the Land of the Setting Sun. This conjures up certain pictures and thoughts. Our sunset land through the centuries, in spite of internecine strife, became homogenous in its culture, in its geographical outline and cultivation and especially in its Christianity. Always through those centuries, England (as is was then called) was part of European history, whether in peace or war, and as our history developed we retreated from our endeavours to govern Europe and stretched out beyond the oceans. With the power this gave us, we saved Europe twice during this century from tyranny.

This consciousness of our responsibility and yet of being different started with the Tudors and through many wars was stamped upon the British race, because, unlike our European brethren, we have never been invaded and occupied since the Norman Conquest. That does not mean that we have been severed from Europe. We have through the years received political refugees of every type and have absorbed them; this has been all to the good and will continue to be so, so long as they come in reasonable numbers. It is always a wonder to me that with the great wide world to choose from, people should want to come to these little Islands.

But the moment has come now when, instead of sending armies across the Channel, we are about to join the European consortium, invited by our Continental brothers. I say"invited"advisedly, with due consideration of what this word means. I have always been persuaded that we would never go into the E.E.C. until the E.E.C. needed us as much as we need them. And we need them as much as they need us at the present time. We are historically one family and, like a family, we shall keep our individual characteristics—that is really what makes a family so interesting and sometimes desperately tiresome. If I have any qualification to speak to-day, it is that I know European languages and countries and for the last ten years I have been in close contact with European political Parties and politicians. I can see clearly that if we are not to be drawn either into a Communist or United States form of civilisation, we have to summon and bring together all the strength of the European genius to survive, and not just to save but to imprint and fortify in our Continent those values which we believe are important for the human race. This is not to disparage the Communist way of life, because that is their way of working out their salvation, or to denigrate our American friends, with their splendid generosity and immense courage in outer space. At this moment they are going to the Moon. But neither the Communist nor the American way of life is for us and for Europe, of which we are an integral part. Nor does Europe wish to become a sort of super Power. I am sure that the noble Lord, Lord Soper, could be reassured upon this point. I am sure we should develop in Europe differently.

We in Great Britain have made immense contributions to European civilisation, in literature, in art, in music, in political savoir faire, in inventiveness of every kind and in recuperative power. We cannot afford to let this opportunity slip away, especially when we can make such a tremendous further contribution to our Western world by coming together with those who now want us. I believe that this is a great opportunity to bring renewed spiritual strength to the struggle for human survival. I believe sincerely that by the coming together of European minds and the pooling of our resources, we can still make this a world worth living in for our children and for future generations. And if the word"still"sounds a trifle sombre, it is because our world is so enslaved by scientific discoveries, so rapid, so overwhelming, that we are in danger of losing our way and lacking the moral fibre to stand up to our moral responsibilities. I believe that this is where a properly oriented Europe can have a powerful and healing voice. If we go in, we shall be walking towards the sunrise. If we stay out, we can see nothing but the sunset and darkness behind us. When we come together and join hands, I believe that the lights will once again go up all over Europe.

7.37 p.m.

LORD WILLIS

My Lords, I hope to be brief. I put my name down only because I believe with the noble Lord, Lord George-Brown, that on an issue like this everybody—even dramatists and script writers—should stand up and be counted. I want to say straight away that I am very much in favour of entry into the Market and I always have been. I think that we have lost precious years and opportunities by being outside. So far as I am concerned, the more quickly we get in, the better. As for terms, I always took it for granted that we should go in on reasonable terms. I could not imagine even a British Government would be so stupid as to negotiate and accept terms which were catastrophic, and by no stretch of the imagination can the terms we are now being offered be called catastrophic. Perhaps a Labour Government would have put a different emphasis and stronger weight there, but, by and large, I do not believe the terms would have been materially different. We have heard as much to-day in one or two speeches. May I say, in parenthesis, how much I regret this quoting of one quotation against another in order to prove certain positions. I believe that from the point of view of my own Party this can only give aid and comfort to our enemies and does not help us.

I am no economist and if I were a religious man, I would go down on my knees and thank God for it, because I never cease to wonder at our economists, to be bewildered, amused, astonished and outraged by their antics. Like so many plœnixes, they keep rising from the ashes of their past disasters to pontificate and prophesy about their next. Since the terms were announced, the Press has been full of articles and letters—learned, logical, stuffed with statistics—by our economists, all seeking to sway us one way or the other. Some tell us, and back it up with seemingly irrefutable figures, that entry into the E.E.C. would be like going through the Golden Gate into a new Jerusalem. We can almost hear the heavenly choir in the background. Others, equally eminent and again with irrefutable statistics, tell us that the gates are made of plastic and entry will lead us to economic disaster; that it is a foul and fiendish capitalist trap which will lead only to the destruction of all the ideals in which we believe. My Lords, what distinguishes all these articles, speeches and letters is their assurance. These marvellous economists know. They are shrewd: they know. Well, well, well—you could have fooled me! From my position of total ignorance of economics I cannot help asking these gentlemen,"What have you been doing for us lately? Where have you been for the last 20 or 25 years? What have you done for us during this period, when we have been stumbling from one economic crisis to another?"There is a great deal of talk about credibility, but I should think that if anybody has forfeited credibility it is our economists, and the greatest service they could render the country to-day would be to keep silent and let us think this thing through on our own. I am fed to the teeth with them.

My Lords, I support entry for many reasons. I believe that it will give our industry, on both sides, the openings and the competitive goad it needs. Further, it will be the end of the Imperial illusions, as so many people have said. Above all, it will mean that, stripped of all that grandeur, all the megalomania and all the nostalgia of the past, we can look forward with a new realism to a status which much more equates with the position we hold in the world to-day. It will further remove the risk of war, and will bring nearer a really united Europe. Here let me say how much I share Lord Shepherd's vision of a united Europe, and even further the vision of the noble Lord, Lord Soper, of a united world. I do not think that going into the Common Market and joining with Europe is inconsistent with that vision and that dream. You have to begin somewhere; you cannot sit hack contemplating your navel and say,"We will not go into Europe until we are holy and we have a wholly socialist State here in Britain." As I said, my Lords, I am no economist, and there are some things to which, as the noble Lord, Lord Bethell, said, the heart and the instinct respond—and that is often a wiser guide than the economic considerations. To me, my Lords, going into Europe is a gut issue. I feel in my guts that it is right.

7.43 p.m.

LORD ROBERTHALL

My Lords, if I speak in a tremulous and nervous tone your Lordships must forgive me, as I have the great misfortune to follow the noble Lord and I am, I must confess, an economist. I can only say that when he has been around rather more he may take the more charitable view that we are not much worse than other professional men, where you can get anybody on any side.

My Lords, we are debating to-day the terms of entry, and I thought it would be interesting to re-read our debate in March of last year on the White Paper An Economic Assessment, which was of course produced before the terms were known. On my rough count, 35 noble Lords spoke, 26 were in favour with various reservations. 6 were against and 3, perhaps, were"Don't knows ". Now that we do know the terms, I thought it would be interesting to see what sort of count we had to-day, but I am afraid that so far the views have been very strongly in favour. On my count, there has been only one against, with perhaps the noble Lord, Lord Shepherd, nearer the"Don't knows ".

For my own part, I am pleased, and indeed pleasurably surprised, at the outcome of the negotiations. I had three reservations about the terms. The first two were about New Zealand and Commonwealth sugar, where we have honourable commitments which seemed to run against the basic tenets of the Common Agricultural Policy. It is a very happy outcome indeed that both New Zealand and the spokesman for the Commonwealth Sugar Agreement have expressed themselves as satisfied. My third reservation was that in the negotiations the Six should show a sympathetic attitude towards our problems. I do not think we wanted to get all that we hoped to get. It was not that kind of negotiation. People say we could have got better terms. I say,"Thank goodness we did not get them!"What we wanted was an amicable agreement as between prospective partners. I think we have got that and it ought to give us great confidence for the future.

In the early years of the negotiations, with the noble Lord, Lord Plowden, I used to have to discuss with M. Jean Monnet and his staff what was the likely impact of entry on this country. It was too early to say. We had to be vague, and at that time Ministers did not like that vagueness. Jean Monnet said it was impossible to spell it out, but that once inside, once we were all partners in a common enterprise, there had to be give and take, and there would be. I was very much struck when I read paragraph 96 of the White Paper now before us, which says, after the paragraph saying that a precise figure could not be put on the balance of payments costs: …the Community declared to us during the course of the negotiations that if unacceptable situations should arise ' the very survival of the Community would demand that the institutions find equitable solutions '. I think the history of the Community and the history of our negotiations entitles us to think that those are not empty words, and that we need not therefore worry about the predictions of some uncertain future made by some of the economists to whom the noble Lord, Lord Willis, referred: that you can imagine situations in which the rest of the Community will gang up against us and that we will be reduced to a backward, neglected and impoverished hanger-on. It is a logical possibility, but that is all it is. My Lords, it is only too easy to terrify ourselves by making a series of hypothetical, unfavourable speculations leading to the worst. The only logical position for people who do that is with their heads under the bedclothes.

All the arguments for and against have been rehearsed, and I will try to make only one more point. There is one argument against entry which was used in the past mainly by the French when they were rationalising the General's veto. That was that at that time we were too weak to enter. Again the argument is being used that we are too weak to enter. It was lightly touched on by the noble Lords, Lord George-Brown and Lord Thorneycroft, and I should like to associate myself with them. It seems to me that that is a misunderstanding of our present position. Our balance of payments remains surprisingly strong. We even have the agreeable experience for this country that for the time being the pound is stronger than the dollar.

But, more than that, we have now got a large margin of unused capacity in the form both of labour and of industrial capacity; and the hard times through which our firms have been passing have had one very beneficial result: they have been forced to look at their use of labour. Labour has been squeezed out; we are probably using our labour force more economically now, I would say—and I have seen a good deal of it—than at any time in the post-war period. Therefore, we have the potential for big increases in output. Unemployment is unpleasant, unused capacity is unpleasant: but where it is from our own choice it gives us great freedom of manoeuvre, much more than we have had in most of the postwar period when we were running over-full and economically bursting at the seams. It is true that the Chancellor of the Exchequer has just announced measures which will use up some of this capacity, but I do not think they are likely to overstrain us or to use it up completely. I think that the character of the measures gives us some confidence. Several of them will run off by themselves and the main other one, the change in purchase tax, is easily reversed.

LORD WILLIS

My Lords, may I intervene to ask the noble Lord a question? Is he, as an economist, saying that the existence of this large pool of unemployment is a good thing, that it gives us freedom of manoeuvre?

LORD ROBERTHALL

My Lords, I think I was saying that it was very unpleasant to have unemployment, and very painful, but that it gives us resources that we can use in the same sense as a general engaged in a war who has troops in reserve has some freedom of manœuvre.

The real weakness in our situation does not lie here. We have a weakness. It is in our continued failure to deal with inflation, the continued increase in costs which is progressively undermining our competitive position. Those who doubt this need only look at our terms of trade, which have been improving so much. It is very nice that we should get our imports for less of our own goods. That is what better terms of trade mean. But it is not so pleasant when we are priced out of the market and the day of reckoning comes, and we have to face either deflation and back to"stop-go"or a devaluation. To my mind it is fortunate that floating rates are now respectable, so that if we have to face the second alternative we will not be hanging on in a hopeless position. This choice will face us whether we go in the Common Market or stay out. I should be prepared to argue that there would be a slightly better chance of controlling cost inflation inside the Market.

We have had a painful and convincing demonstration of what many of us have said for a long time: that no politically tolerable level of unemployment will stop cost inflation. The Government now claim that de-escalation has taken place and will continue. I hope sincerely that they are right; but it is not a good augury that we have gone over to reflation with so little to show in the form of restraint for the sweat and tears of that period. That in my view is the basic weakness of our position, and has nothing to do with whether we enter the Market or not. For the rest I wish the Government every success in leading us into the Market. To my mind, the position now before us is, on the one hand, to return to being what for so long we were, a country which looks forward and outward; and, on the other hand, to choose a path uncharacteristic of our great past, to fix our eyes backward on that past and inwards on our not very great present.

BARONESS GAITSKELL

My Lords, before the noble Lord sits down, as he is such a distinguished economist, may I ask a question? Is he really saying, as I understood him to say, that the only answer to cost inflation is more unemployment?

LORD ROBERTHALL

No, my Lords, not at all. I am afraid that I cannot have made myself clear. I thought that my views on this subject were well known: that to try to stop cost inflation by unemployment was politically intolerable. Therefore, in my view the only way to stop it is with a wages policy. I have never claimed that unemployment was the way to stop it.

7.57 p.m.

LORD JACQUES

My Lords, in our debate of March last year I put forward in some detail the economic arguments, as I saw them, why we should become part of the Community. I am not going to repeat those arguments but I think that they are equally valid to-day. Furthermore, as time goes by, I am increasingly convinced that Britain can make a bigger contribution both to the peace and prosperity of the world inside the Market than outside it. The Community is the first attempt that has been made to unite Western Europe by reason rather than by force. Here you have nations which were traditional enemies working together for the common good. It can at least be said that the likelihood of their coming into armed conflict with each other is less than it has ever been, certainly in our lifetime. Furthermore, the coming into being of the Community has not deepened the rift between East and West Europe as many feared it would. The tensions between East and West Germany are less than they have been since tile War; the tensions between Germany and Poland are less than they have been since the War. Indeed the whole of the relations between Eastern and Western Europe have been better in the last 13 years than in the preceding 13 years.

In human affairs, the harmony and strength that comes from unity is respected, and I believe that this is one factor in there being better relations between East and West Europe. The Community is cynically described as a"rich man's club looking inwards ". Let us look at the evidence. The tariffs around the Community on average are slightly less than our own tariffs; the trading associations which the Community has got with under-developed countries are so attractive that some of our own colonies are now partners to those associations. They admit imports from the Community at lower tariffs than imports from Great Britain. All the countries of the Community, with the exception of Italy, give aid to the underdeveloped countries on a greater scale than we do. The argument that it is a rich man's club looking inwards does not stick on the basis of tile evidence.

Furthermore, some of the countries within the Community have the same kind of problems as we have of regional development in their homelands, and they are using very similar remedies for them. In all the countries except Italy not only are wages higher, but paid holidays are longer; more money is spent on social services and on housing, and in the two most important partners in the Community there is legislative provision for workers' participation in the decisions of the larger companies of a kind we have not got here but with which we could do very well.

I have studied the terms with some care, and with some pleasure and some disappointment. I have read with especial pleasure of the terms for New Zealand produce. Those terms are very much better than I has reason to expect. On the other hand, I read with disappointment of the contribution that we have to make to the Community's budget. I think it is excessive, especially in the first three years; but it is perhaps appropriate that if some terms have to be harsh and others less harsh the harsh ones should be those borne entirely by ourselves and the less harsh those which are partly borne by our friends overseas. As a package I should say that without doubt it is acceptable and up to our expectations.

I also agree that there are some things that we cannot calculate with any reasonable accuracy. We cannot calculate the effect upon our balance of payments of the changing pattern of trade or the free movement of capital. But we have one happy advantage over the Six who are already members of the Community. We have the benefit of their 13 years' experience. They had exactly the same fears as we have now. Germany, for example, had to make a substantial contribution to the Community's budget and feared that it would have an effect upon her balance of payments. The French Communists forecast massive unemployment in France. The Dutch were afraid that their workers would leave for Germany en masse. The Italian Communists said that the country would become even more depressed. None of these things has happened. Belgium, with her declining industries and her slow rate of growth, joined with some trepidation, but from the beginning her growth has been at twice the rate that it was formerly. I believe there are good reasons for thinking that our experience within the Market will be very similar to that of Belgium; the circumstances are very much the same.

I hope that we shall accept this hand of friendship that we shall enter the Market as an act of faith and throw in our lot for the common good.

8.5 p.m.

LORD GREENWAY

My Lords, I, too, should like to add my congratulations to our two maiden speakers, the noble Lords, Lord McFadzean and Lord Burgh. I put my name down to speak in this great marathon because the noble Lord, Lord Sandys and I were the only Members of your Lordships' House to attend the séance in Strasbourg at the Maison de 1'Europe two weeks ago. My Lords, do not be worried by the word"séance ". This is no mystic ball, nor Voodooism, for it is in fact printed on the Order Paper every day in the great European Parliament. In other words, the European Parliament is a séance.

As members of the delegation from both Houses at Westminster, observing for the first time, we were introduced to the Chamber by the President. This was a most moving occasion. We heard statements on the various agreements reached in the negotiations on the United Kingdom accession to the E.E.C. on June 23. These, my Lords, were made by all Parties in the European Parliament, in the Chamber itself in Strasbourg. We had two sessions, lasting about two hours, with the Reception Committee of the European Parliament at which both sides had a very healthy exchange of view. The breath of fresh air that was blowing in through the windows was so rejuvenating to all present that it became a fresh gale. My Lords, the temperature outside was 97 degrees, but we were rejuvenated and refreshed. It was terrific.

I will give two examples. One evening on the terrace I was present with at least 10 members of the European Parliament with some Members of our Parliament On my left I had an Italian who was a Communist, and on my right was a lady from Luxembourg: she is a Social Democrat. I was very interested in what the noble Baroness, Lady Birk, said about her visit to Luxembourg, because this lady is mayor of her city in Luxembourg and she is a great Social Democrat. Her city is a great steel city. She was with another great lady who is the Burgomeister of Luxembourg itself. They have six members of the European Parliament and two are ladies, so a third of their members in the Luxembourg Parliament are ladies.

There were many members of all Parties present, chatting amiably together as if they had been doing so all their lives. This was only one example of the many and wonderful occasions on which we met each other belonging to a new European school, the great school of the future. It was simply wonderful. I talked to many people in all parts of this great European Parliament—interpreters, translators, secretaries—from all parts of the Community of Europe. Language, I assure you, is no problem. They all said,"Your visit here this week has been to us a wonderful breath of fresh air. It is what we have all been long awaiting"My Lords, if we do not enter this great history of the world that is coming to pass it will be a disaster for the United Kingdom and for Europe.

8.8 p.m.

LORD HANKEY

My Lords, we seem to have shown an almost incredible degree of unanimity in our debate on what until now appeared to be a very controversial question. I have never felt that it was as controversial as it appeared to be. I agree with all the economic and political and other arguments used in this debate in support of our entry and I do not propose to repeat them. I should like to go back a little and look at the history of the period we have lived in and to show your Lordships that if we take a dynamic view of what has happened since the War, then what we are now proposing to do is a logical and sensible conclusion to what has gone before.

My mind goes back to that very great Foreign Secretary, Mr. Ernest Bevin. I was head of the Northern Department in those days and we were very worried about the state of Europe. It was in a tremendously disintegrated state, with Communism threatening on every hand. I remember in that summer of, I believe, 1947 Mr. Bevin picked up the telephone and called General Marshall, the Secretary of State in the United States. The result, some ten days later, was the famous speech which started the Marshall Plan, out of which arose the O.E.E.C. Then I remember another remarkable occasion when Mr. Bevin sent for Lord Gladwyn (he was Mr. Gladwyn Jebb at that time) who was head of the Reconstruction Department—I am sorry the noble Lord, Lord Gladwyn, is not here. Mr. Bevin said to Lord Gladwyn:"This idea of a Council of Europe is very interesting, but we have to think what functions we can give the Council of Europe to do. You go away, Gladwyn, my boy, and think this out, and come back with a sensible plan." Some time later Lord Gladwyn did come back and we had another meeting. He said that he could not really think of any functions that we could transfer—not, at least, any functions that anybody would at that time approve of transferring. I mention this point because it has been the fundamental difficulty: we could not agree upon what functions we were going to transfer to these various bodies. Nevertheless, we set up the O.E.E.C., first to apportion Marshall Aid and then to reduce the financial and trade restrictions between European countries, and from that the tremendous upswing of prosperity in Europe proceeded.

It is one of the tragedies of our time that the British never seem to believe in anything, even themselves, for very long. This, I am sure, is what the noble Lord, Lord Thorneycroft, was thinking when he mentioned the difficulties the Europeans had with London. The result of this was that the British got pushed into the Chair of the O.E.E.C., as I well know, because I was afterwards chairman of the O.E.E.C. at the official level. It was felt that if we were in the Chair we could not decently refuse to support such an institution. If I may say so, the noble Lord, Lord Thorneycroft, was a superb Chairman. His name has never been forgotten in Paris, and if you ask anybody associated with the O.E.E.C. who was the greatest Chairman they ever had, they will unquestionably say,"Lord Thorneycroft ".

Reference has been made to Sir Anthony Eden, now Lord Avon. I think the Treaty of Rome would never have been possible if Sir Anthony Eden had not gone round Europe on the failure of the European Defence Community proposals and, by a superb exercise of personal diplomacy, enabled a reconciliation to take place between the Western Powers and their former enemy, Germany. Your Lordships will recall how in 1953–54 Sir Anthony Eden enabled Germany to be brought into the community of Western Nations as an ally. Without that, I do not think the Treaty of Rome could ever have been concluded. I should like to defend Sir Anthony Eden against being a poor European: he was, in fact, a very good one, but, like Mr. Bevin, he could not think of any functions which we would willingly transfer to these international organisations.

Then we have to remember the sad events of 1956, because that was a train of events which completely changed the situation of Great Britain. From being a first-class nation which aspired to lead and help the other European nations, we suddenly took a lower rank. Stalin once said that wars do not change the course of history; they hasten it. In effect, we lost a war, a peaceful war, if you like, on that occasion, and it certainly hastened the course of our history. I do not think we have ever been in a position since then to dictate the pace in Europe. We tried hard with the proposed European Free Trade Area of 1958 and so on, but after that I think it was inevitable that we should, sooner rather than later, decide to try for membership of the Common Market.

If your Lordships will look back at the traditional lines of our foreign policy, you will find that it has usually been to endeavour to ensure that the nations who live opposite our shores did not all get together. That policy, I think, is no longer applicable. It would be obviously disastrous if we were to try to divide the Common Market; and, on the other hand, it is probably as true as it ever was that we shall be a poor off-shore island, and subject to a great deal of pressure—, such as the economic pressure that we suffered in 1956 and in later balance-of-payments crises—if we do not join them. So I think the old rule of American politics applies:"If you can't beat 'em, join 'em ". That may be a negative reason, and I say this here only because so many noble Lords in this debate have stated the positive reasons, and I fully agree with them.

LORD SLATER

My Lords, I have listened attentively to what the noble Lord, being an ex-diplomat and an Ambassador in various parts of the world, has said. Some of us were at one period delegates to Strasbourg. We have stood on our own feet now for generations, and we have still taken a leading part in the world. It ill becomes anyone to suggest that we are not able at this period in our history to stand on our own feet, but have to join the E.E.C., as now recommended by the noble Lord and others who have taken that stand.

LORD HANKEY

My Lords, we have been standing on our feet only moderately successfully. Unfortunately, it is necessary to face facts. For instance, in 1963, in gross national product per head in O.E.C.D., the United Kingdom came tenth; and in 1969 we were a poor twelfth. If I thought that we could hold our position, I should warmly agree with the noble Lord. But I would invite him to look rather critically at the statistics, and, if I may say so, to look at them in a dynamic way. It is the change in our position which unfortunately has converted so many of us to think that we should do well to go in.

I am a Vice-President of the European Institute of Business Administration in Fontainebleau. That is a business school, run on Harvard lines, in English, French and German on the widest European basis. I am interested in this, because I have always felt that if we could get really bright members of British management, even only 20 or 25 a year, trained to the highest standards in English, French and German, and able to operate anywhere in Europe, or in the world, it would in time affect our balance of payments. But what has happened? It is most interesting and significant that the rates of pay offered abroad are so much higher now than the rates of pay offered in this country; and I am sorry to say that the United Kingdom is not getting a fair share of our own graduates. I find this intensely irritating. This is the sort of problem, and the sort of indicator which we now have to face. To put a more positive attitude on it, I would say that, from my experience in O.E.E.C. and O.E.C.D., I am convinced that the British can make a splendid contribution to the Common Market. I believe that we can supply officials of all sorts, and Ministerial guidance at the highest levels, in the Common Market which will be greatly appreciated and render most valuable service to Europe. I 'believe that, for the reasons I have given, we cannot afford to see the Common Market become less successful; that we are in a good position to make it more successful, and this will be particularly valuable for ourselves.

I am more or less a founding father of EFTA, because I was Ambassador in Stockholm when EFTA started. I was very much struck that whereas a great many people expressed all sorts of fears about the awful things that would happen to British industry when we established a Free Trade Area under EFTA, none of those things happened. EFTA was extremely good for our industry; it was an absolute shot in the arm: we were able to demolish the EFTA tariffs years before the end of the transitory period. As the noble Lord, Lord Jacques, very rightly mentioned, similar fears were expressed inside the Common Market, and they also were able to do things ahead of schedule. So, my Lords, what is more likely than that, when we throw down the barriers between EFTA and the Common Market, or a good many of the EFTA countries and the Common Market, we shall find a similar shot in the arm given to industries on both sides?

I should like to mention also relations with the less developed countries. Although I am an ardent Commonwealth man, I believe that it is time to recognise that there is a colonial taint about our relationship with a good many of these countries overseas. I believe also that this colonial taint would not apply to the same degree to relations between the Common Market as a whole and the less developed countries. Certainly the East African countries, to which the noble Lord, Lord Jacques, also referred, have not felt that, because they have joined the Yaounde Convention as full members and are at present, I believe, applying preference against British goods and in favour of the Common Market. I say that subject to correction.

I believe that the arrangements which we are making, as explained in the White Paper, will be extremely valuable to large parts of the Commonwealth. I believe that the rate of overseas aid which they will receive will probably be increased. As members of the Council, under the Yaoundé Convention, they will be able to make their wishes heard in a useful way. I personally look forward to a new arrangement in the Mediterranean, where I should have thought that the new Europe might establish a new relationship with the countries of North Africa, which at present are going through a very difficult period.

Then there is the United States of America. In my view, it is essential that the links which we have with the United States should be maintained. I believe that it will be of great advantage to the Common Market if we, with our particular understanding of the United States, were to come into the Common Market and bring those links with us. I believe that this is something that we have to offer and that in time it will be greatly appreciated on both sides of the Atlantic.

It is important to remember that the United States represents 25 per cent. of the gross national product of the world. The whole of the rest of the O.E.C.D.—that is, all of free Europe, with ourselves and Canada and Japan—represents another 25 per cent. In all, those countries represent 50 per cent. of the gross national product of the world. The growth of world trade and of the trade of the less developed countries does depend in large measure on the understanding across the Atlantic and with those countries. I hope that nothing that happens when we join the Common Market will lead to a weakening of the links inside the developed world, the promotion of which is essential for the further development of the less developed countries.

To sum up, my Lords, I think that now is the time to join. I hope it will be realised that we have to go in when we are not too strong. If we are too strong the Common Market will be afraid of our competition. If we are too weak, the Common Market will be afraid that we shall be a burden on them. The present time, when our economy has a good balance of payments and is beginning to pick up, is, I believe, exactly the right psychological moment for clinching this deal, and I believe that that is what we ought to do. We have been invited to join, and we shall lose all credibility if we do not do so.

After the veto by General de Gaulle in 1963, I went to see that great European, M. Jean Monnet, for whom I have long had a very great regard. He may be regarded as one of the fathers, if not the father, of the European Movement. I said to him,"You realise that this veto will have a very discouraging effect on the European movement in the United Kingdom. What do you think about that?"M. Monnet said,"It really does not matter at all. If the Common Market is a success, the British will join; they always do, if it is not a success, it does not matter anyway." My Lords, it is a success, and we shall join.

8.25 p.m.

LORD GRANVILLE OF EYE

My Lords, I hope that the noble Lord, Lord Hankey, for whose experience and expertise I have the highest regard, will forgive me if I do not seek to controvert some of the arguments that he has been putting forward. I make no apology, even at this late hour, for intervening briefly as a Back Bencher in this debate on the European Community, because I think that if ever there was a subject that should be debated by Back Benchers of your Lordships' House, this is the one.

I suppose that to a certain extent the speeches or attitudes of the Front Benches are fairly predictable; the White Paper experts have done their best—or worst—and Parliament is again being asked to back the experts. It has been said historically that the experts, the columnists, the"boffins"and the backroom boys have often been wrong on the big things. It was said they were wrong—as the noble Lord, Lord Boothby, has so often reminded us—about the 1926 gold standard decision; on the 1931 crisis and the advice that was then given; in the advice on Munich and on the recent sterling crisis; in the advice that they gave on India, and the advice that they gave Sir Winston Churchill on the Abdication. So it is said they have almost invariably been wrong when it has come to the really big issues. I am wondering whether, if one looks for the reason, as events have turned out it is because these experts who put forward their advice to the Government of the day seem unable to mobilise sufficient ordinary judgment to understand what public opinion reaction is likely to be to any given policy or any course taken.

On this great issue which has been debated in the Press and now in both Houses, I think what is going to be increasingly important is the attitude, the opinion, and the final judgment of the ordinary people. This is a very adult democracy, and if you look back, in a crisis its judgment on great issues has been absolutely superb. The people have been right. They were right over everything—the Abdication and all the rest of it. If ordinary men and women to-day have very grave doubts about the position, then I think that the Government would be well advised to take due regard of that view, because in the end it is the ordinary people, the man in the street, the voter, the electorate, our democracy, which will eventually decide.

Apart from Gallup Polls and so on, it is difficult to find out what the ordinary men in the street are thinking. I have heard this issue referred to by them as"Ted's Folly ". I have heard them say that they think they are being"conned"about this by the experts. It is an extraordinary thing, but if you look back you will find that advisers often tell Prime Ministers what the advisers think they want to hear; and often since the days of the Carlton Club meeting, the fall of Lloyd-George and the break-up of that Coalition, too late they have discovered what the reaction of the man in the street is and what he is really thinking. Whatever is decided by both Houses of Parliament, I firmly believe that in the end public opinion will prevail. In my view, this is the present Government's greatest gamble, and I think that ultimately they will lose out on it so far as public opinion is concerned. I believe that the issue will be finally decided at the next General Election, whenever it may take place.

I ask myself one or two very simple questions about the White Paper and the advice that we have been given. It is, of course, a public relations exercise, and I ask myself a question that the ordinary business man must also be asking himself to-day; namely, can the producers—the labour force, industry, trade and commerce in this country, compete with Germany and Italy here on the home market when the tariffs are gone? Recently in the Press there was a statement regarding the possibility of a reduction of tariffs on motorcars. Immediately the motorcar industry in this country began talking about a crisis. This is a two-way business and it means exporting to the Continent of Europe as well as importing from there, and the Continentals are pastmasters at attracting market consumers. They will be coming into this market in competition with our trade and industry, and we shall not have the protection of a tariff.

So what happens—do we work harder for longer hours, do we become more efficient, get our costs down, improve our marketing and our general efficiency? If, even after that, we are going to lose a fairly large slice of the market to those very astute Continental competitions, what then is the sanction—unemployment? There is another question we have to ask ourselves, my Lords, and that is whether our efficiency is running down. After all, the Continentals had to pick themselves up from the floor; they had to build new factories and put in new plant; they had to be efficient to live. But is our efficiency so run down that it would be asking too much for us to be able to compete with them on an equal basis? I also ask myself about overheads, because we shall be facing competition, and it is real competition.

We cannot just wave a magic wand in Brussels. There will be a thousand and one producers competing to sell their products and we have to ask these questions: are our national overhead costs too high; are they higher than our Continental competitors; are we carrying too much fat in our national overheads? If we are, this is another point on which we should find ourselves at a disadvantage. The Germans, the Italians, the Belgians and the French have more experience and are more skilled at what I call"door-step exports ". They have had to teach themselves to be. They design and produce a product and put it on the market, and then they think"Where can we sell this abroad? "

I believe that a number of industrialists are beginning to ask, when examining the implications of the White Paper for the home market here and the Continental market, whether people are going to buy two washing machines where they bought only one before. If not, then they will ask whether we are not going to look rather like the dog with a bone in its mouth looking into the pond—losing the good export trade that we have at present and finding that the market for consumer goods of this kind is not as big as we thought? I believe that our great experience has been in connection with what I call the far-flung exports in the wider markets of the world.

Turning now to the cost of living, nobody seems to understand from the White Paper or Ministerial statements what will happen about this, but the ordinary man in the street does not trust the experts. He seems to have made up his mind that the cost of living is going up still further by a considerable slice. The Government have no mandate to take this gamble: no mandate at all. If there is to be no referendum, and obviously no immediate General Election, if no Select Committee is to be appointed to examine the full implications of the White Paper, and if there is not to be a free vote, then both Houses of Parliament are going to take a decision on this vital matter on behalf of the people of this country. I think that if we go in the consequences for our industry could be serious, and they could also be serious for the Government.

I have always believed that vigorous, inspired Commonwealth leadership, even after the war, could have won through, even after the days of Lord Beaverbrook and his Empire Free Trade. I have always believed that a great English-speaking area across the globe was the best opportunity for this country to maintain its security and increase its standard of living; and whether we like it or not, since D-Day we have depended very much upon that other great English speaking nation, the United States of America, which was referred to by the noble Lord, Lord Hankey. We have depended upon them for security, industrial help and credits ever since they foresook their classic position of isolation. I think the tragedy of the Conservative Party, which has always been looked upon as the Party of the Empire, is that somewhere they have lost the vision of the Commonwealth, and—without being offensive—they have replaced it by little tailored technocrats with unit trust minds, who have failed to translate"Empire"into"Commonwealth ". We have been into Europe before. It is our backyard security. But our real security is the automatic deterrent and a close understanding and working arrangement with the United States of America. In conclusion, this Government may take us in: if so, it will not be"Ted's Folly ", as the man in the street has called it, but the responsibility will then rest fairly and squarely on the Houses of Parliament and nowhere else.

8.39 p.m.

LORD ANNAN

My Lords, if I had to sum up the general feeling in the country about the Common Market I would guess that there was some apprehension about the economics of the venture and some warmth for the political aims. The very name"Common Market"suggests a place where you do business, and it is inevitable that when people talk about a market they visualise first a balance sheet. Ever since the Corn Laws were repealed this country has enjoyed cheap food, and it is not to be supposed that the benefits which a few large industries may get by our going into Europe will compensate the country as a whole for the loss of all that cheap food.

I do not quite share this sober certainty of waking bliss felt by some of the Marketeers who believe that Britain should enter. It should be a sobering thought that there is scarcely an economist in the country, whatever his political persuasion, who confidently forecasts that there will be immediate benefits. Those who, like myself, support entry to the Market ought to admit that in the very first year the going may be extremely rough and we may run into serious economic trouble. But the truth of the matter seems to me to be not so much that the economists' prognostications are wrong, but that there is no possible way of estimating what the result in economic terms is likely to be. Time and again in business, when a decision has to be taken, it has to be taken on a hunch, however rigorous the analysis of the consequences of taking that decision may have been. I think that the White Paper is perhaps a document more remarkable for its reticence than for its prognostications; but, whatever great play may be made with that, I do not myself see how it could have been otherwise. The real economic justification for entering the Market is that only by entering can we change it; only by belonging can we protect ourselves; and only by being a member can we exercise a veto if our national interests are in peril.

I hope it will be recognised by whatever Government is in power that our national interests must be the lasting criterion when we are in the Market. For the past ten years we have licked the boots of the French, not merely in Europe but in the Middle East and in Africa, for fear that something we said or did would offend them. Only the other day, M. Massigli was reminding us that we must join the Market in good faith and not seek to alter it directly we get in. I sympathise with his point of view when he says that the British must recognise that the agricultural policy is designed to protect a class in France, the peasant farmer; because if, suddenly, at a stroke, the peasants' livelihood was made impossible it would throw France into a revolution far more profound than the events of May, 1968. I thought, when he said that, of our own hill farmers in Scotland and in Wales. They, too, need protection. I thought also of the agricultural subsidies which we have been paying for many years since the war to our own farmers with exactly the same intention as the Common Market has towards its farmers.

Nevertheless, we are not going into Europe in a static role, and therefore it may very well be that we shall need to try, as soon as we get in, to modify some of the policies. Just as President de Gaulle changed the market—much, I think, to the detriment of the Six, though perhaps he achieved short-term gains for his own country—so Britain, on entering, has every right to remind the Market what will be our interests; to remind those who will be our fellow members that we, too, have national interests which have to be given consideration. There is one reason why I stress national interest. Political proposals which do not consider national interests are delusory. Europe wanted peace in 1918 and gave birth to the League of Nations, but no-one in that organisation sufficiently faced the fact that national interests would conflict, and as there was no machinery for reconciling them or for minimising the clash, the League collapsed. In the United Nations, again, there is not the faintest pretence that the national interests of its members can be reconciled, but in the European Union that question has been faced, and there is machinery. At the moment the Community is small enough for some kind of a reconciliation of national interests to be made, and the countries in the Union are sufficiently alike in their political, their economic, and their social structures that there is a chance of their agreeing on most questions of broad policy.

Why, then, should we go in? The answer, it seems to me, is the one which has been given repeatedly this afternoon and this evening, and that is that we really have no alternative. If that is a pessimistic answer, or an answer with little enthusiasm, I put it forward because it is at any rate one that seems to me to be more truthful than more grandiose suggestions. We know what it is like to stay out. If we do stay out, I believe that we shall stagnate. We shall find it harder and harder to trade within Europe, and less and less easy to withstand European competition and American competition in our former world markets. The day when we can go it alone is past. That is why I sigh when I hear the present Government talking about the reconstruction of an East of Suez policy; but I expect that, as the previous Government discovered, they will find that it is in a real sense impracticable.

I was very relieved when I heard the noble Lord, Lord Carrington, admit that we no longer had the power or the will to police the world. I was much moved by his statement on his own conversion, his realisation, in fact, that we could no longer perform the great imperial tasks as we once had done. We can no longer, I believe, support a sterling area. The other European countries learnt all this the hard way. They learnt it through defeat. They learnt that nationalism, like patriotism, is not enough. We were not defeated in war, and perhaps the hardest thing this country has had to bear is to rid itself of its delusions of victory, of its grandeur, of its legitimate pride in what it achieved between 1939 and 1945. But if we attempt to continue with the idea that we are a World Power, in the sense that there were World Powers before 1939, then I think we shall end in bitterness, in xenophobia, in isolationism. Perhaps the thing which distresses me most about some of those who oppose entry to the Market is the evident isolationism, the evident fear of wider unions which they exhibit.

In our history we have always needed political allies. We have needed them, of course, in the old days, because of the fear of war. As a historian I think of our past as a time when we always needed such allies, and our worst folly—although it may not have seemed so at the time—was to allow ourselves to become isolated between the period of about 1880 and the formation of the Entente Cordiale. Today we need not so much political as economic allies. It is precisely because the Six are an economic alliance that I hope we join them in order to become the Ten. I hope that no-one will consider that I am cynical if I say that, if the Treaty of Rome does prove disastrous for us we shall break it and get out. Nations have always repudiated alliances and treaties which have gone sour"on them. There is nothing irrevocable in the step we are taking, but there is, I think, an irrevocability for people of my generation: for my own generation it is irrevocable. We shall certainly be committed, if we enter, for the next 15 years, and possibly for longer. But I am perfectly content to be so committed, for on this issue I follow Pascal in the great passage in which lie asks what line is one to take if one discusses the immortality of the soul, and he ends by saying, "Il faut parier": one must bet. My Lords, I am prepared on this issue to put my stakes on entry.

8.49 p.m.

LORD SELSDON

My Lords, for the past ten years my job has taken me in and out of the countries of Western Europe, and I have worked closely with companies and organisations in all the countries of the Common Market. To someone like myself, who has seen opportunity after opportunity pass us by, it is hard not to feel a little emotion that we are now on the point of making a move that many of us hoped might have been made as long ago as 1961.

I am as convinced now, as I always have been, that we must enter the Common Market. I do not necessarily like, or accept, the argument which is often advanced, that if we do not go in we shall suffer dire consequences, and slide down the slippery slope to economic and political disaster. I prefer, as I believe in general the Government do, to look at the opportunity which we shall place ourselves in a position to seize. In doing this I am swayed far more by what I have seen, heard and felt in the past few years, than by historic or economic arguments, or by facile attempts to quantify something which I personally feel it is impossible to quantify. Thus, I totally welcome the White Paper, not only because I support its views, but also because it has steered clear of quantification and concentrated, in the main, on general opportunity.

There is one are of opportunity upon which the White Paper has touched too lightly, and it surprises me that in putting forward a case for entry so little should have been made of the opportunity which exists for our service industries, and it is on this specific area that I should like to concentrate. Too little is said, and has been said, about the significance of invisible exports to this country, and of certain of these invisible exports in particular. In considering our case for entry it is vital that we should give full weight to the pros and cons relating to this sector of our economy. Thus I commend to your Lordships, as others have done, the excellent Report of the Committee on Invisible Exports which was published last week. This Report, in general, seems to give considerable support in favour of our entry.

I should like first to look briefly at the total invisible export picture and then move on to certain service industry aspects of it. Our total credits for invisible exports are over £4,000 million a year. The figure itself does not mean so much, but it is about half that earned by the United States, and about twice as much as that which is earned by France, Germany or Italy. After deducting debts, our net surplus for private invisibles is about £1,400 million; if we deduct the Government transactions, we are left with a total net invisible balance for 1970 of £628 million. Your Lordships will agree that this figure is significant, bearing in mind that our net balance on visible trade is only nominal, and in 1970 was around £3 million.

Of our total invisible receipts only 12 per cent. at present come from the E.E.C. countries; the remaining 88 per cent. come from the rest of the world. The question we must ask is: will our entry into the E.E.C. bring about an increase in our private invisible earnings from members countries, without adversely affecting our earnings from non-members? I am convinced that the answer is, Yes. In particular, I concentrate on that sector known as"other services ", where the major growth potential lies. It would be wrong to ignore sectors such as shipping, civil aviation and travel. In each of these I understand that, although there may be no immediate short-term advantages from entry, the medium and long-term effects should be beneficial. These other services are the most important of all. Together they account for over 25 per cent. of all private invisible receipts, and their net earnings are not far short of equalling our total invisible trade surplus.

In these service industries it is important to consider the natural talents of the people of this country. This is an area where such things as trust, confidence, security, efficiency, personality, humour, tolerance, experience, salesmanship, and so on, play an important part, and also we should not forget the significance of the English language. This area, which comprises insurance, banking, merchanting, brokerage, export houses, the professions, advertising, and so on, could show dramatic growth in the E.E.C. Only 2 per cent. of invisible earnings in this sector come from the E.E.C. countries at the present time. Although the Eurodollar situation makes the figure artificially low, to me a low figure indicates an opportunity for growth. Let us look at it this way: in these areas, and in particular those accounted for by the City of London, we have services and expertise which are developed far beyond those of any E.E.C. member. This expertise is already acknowledged on a world basis. A growth of invisible net earnings from around £200 million to over £500 million in five years for Inc City alone bears this out.

There is an emotional factor. The cloud of uncertainty over our entry has held back many of our companies and organisations in this area from an all-out attempt to develop business in the E.E.C. Moreover, many Continental businesses have fought shy of buying services from a non-E.E.C. member whose future is uncertain. Now for the first time the barriers look like coming down, and the opportunity for our services, which has steadily grown as the strength of the countries of the Common Market has increased, will be easier to grasp. It is our expertise in these areas which makes me feel that, far from endangering our current earnings from the rest of the world, it will improve them. As the European experts in these areas or, as some would say, as the world experts in these areas, our entry into the E.E.C. will tend to encourage the outside world to direct more and more of its European business through us, rather than going direct to those markets whose experience and facilities are far more limited than our own.

But in which areas in particular do we stand to gain? Everyone can have his own opinion. One I take is insurance. In our debate on the previous White Paper I referred to the potential which there is for our insurance industry. I emphasised then, and subsequently, in your Lordships' House the need to make certain that the harmonisation of legislation affecting insurance should not adversely affect our insurance companies or Lloyd's. Our net insurance earnings from the E.E.C. have currently been estimated at around £10 million—which is relatively small if one looks at the potential. If restrictions can be removed totally, or even partially, we should see some dynamic growth. The amount of this growth, and the liberalisation, will, to some extent, depend upon the efforts and pressures of our insurance industry.

Now that our entry looks like being a reality, and attention is being focused upon the opportunity, we shall see greater efforts to develop it in all quarters. The banking area, as I have mentioned, has to some extent been covered by the Eurodollar situation, where our banks have borrowed and paid interest on Eurodollars abroad. This Eurodollar section is significant because of its dramatic growth from about $9 billion to $57 billion in five years, of which it is estimated that we have around half. It is probable that the growth in the Eurodollar market will not go ahead at the same pace. It is maybe in other sectors that the major opportunities appear to lie: for example, dealing in securities, unit trusts, lending, mergers and acquisitions, and so on. Benefits from most of these will, like insurance, be dependent to some extent upon the liberalisation, of legislation, but there can be no doubt that there is a major potentional in that area.

My Lords, our merchant banks, in particular, are unrivalled in Continental Europe. Many, with initiative and drive, have already cornered for themselves lucrative markets for their services, which are gradually being extended to cover a wider and wider range. We have our Stock Exchange which is bigger than all the Bourses in Europe altogether, the commodity market, the Baltic Exchange, and so on. Our entry into the E.E.C. should stimulate investment, focus attention upon the services which we offer, and enable us to capitalise even more fully upon the respect and trust we have built up over generations.

9.0 p.m.

LORD WYNNE-JONES

My Lords, I have been present at three debates dealing with the Common Market and have attended each of them, hoping to be able to learn from the speeches made and the arguments used what was the real advantage of joining the Common Market; where we were going to gain; where Europe was going to gain, and where the world is going to gain. It seems to me that we must take all these factors into account when discussing such an important step as going into the Common Market. All my adult life I have been not only a Socialist but also an internationalist. I have always thought that what happens outside this country is at least as important as what happens within this country. And, quite naturally, I have looked at the whole argument concerning the Common Market to see how joining it is going to advance not only ourselves in this country, and our economy, but also Europe—and, indeed, far more than Europe, because we are concerned also with the developing world. It is important that we should remember that the developing world holds the key to what happens in the world in the next twenty-five years. We may think that we are important; we may hope we are. But it is what happens in Africa and in Asia that will determine what happens to the world as a whole.

I have been disappointed to find that in the three debates to which I have so far listened I have not heard, to my way of thinking, a single substantial or valid economic argument. I have heard a great deal of optimism expressed; I have heard an astonishing amount of mythology. But I have not yet found any clear-cut argument—although I will say that to-day three noble Lords have touched on arguments which might have helped. One was the noble Lord, Lord McFadzean, to whose maiden speech I listened with great interest and attention. Then the noble Lord, Lord Sherfield, referred to the examination lie had made among small businesses; and the noble Lord, Lord Annan, also made some remarks which seemed to me to be beginning to touch upon the subject similarly. But still none of them came to the point of a clear argument.

I find this astonishing, my Lords, because I have genuinely tried to examine the arguments. I have approached this matter, so far as I can—no one can do so completely—with an open mind. I have come to the question with no preconceived ideas, except that I would rather see international solutions than national solutions, and therefore in one sense I am in favour of the idea of an Economic Community for Europe. But many of the expressions which have been used, not by your Lordships but in other places, have seemed to me quite extraordinary. There have been remarks about"paying the entrance fee to join a club ". Whatever has an association of nations to do with either the Athenaeum or the Carlton Club, or any other club. It is an astonishing use of words, and it suggests that people have the most astonishing ideas about such a union of nations when they refer to it as a"club ".

I have heard certain other strange expressions. I am sorry that the noble Lord, Lord Gladwyn, has had to leave, but he spoke about"a dash for freedom ". What is this strange"dash for freedom"that we make? And he went on to say that if we do not make this dash for freedom we should remain a down-at-heel, offshore island. My Lords, I have become a little weary of hearing noble Lords on the Liberal Benches run down this country and speak about this country as if we were a worn-out old shoe.

SEVERAL NOBLE LORDS

Hear, hear!

LORD BYERS

My Lords, if the noble Lord will allow me to intervene, may I ask whether he cannot see the difference between looking ahead twenty years, as we did twenty years ago, and what is going to happen in another twenty years if we try to"go it alone "?

LORD WYNNE-JONES

My Lords, I am glad that the noble Lord has risen to put that point. I have noticed that the Liberals tend to speak about what happened twenty years ago and use that as an argument for not having progressed in their thought and for remaining to-day where they were twenty years ago. I suggest that it is rather ridiculous to talk to-day about going into the Common Market in the same way as we might have spoken about it years ago. For instance, the noble Lord, Lord Boothby, quite emotionally, and I felt quite fairly, spoke about what he wanted to do then; but he did not make the mistake of saying that he wanted to do it in the same way to-day. I suggest that if the Liberals are going to continue in thinking of twenty, or sometimes of a hundred, years ago they will remain in the wilderness for a very long time.

This whole problem of the Common Market seems to me one which is treated with great triviality. It is not treated as I should hope such an important matter would be treated. As I have said, the expressions used seem to me quite extraordinary in dealing with such a problem. But when one comes to the various matters with which we are concerned in this whole problem of a European association, naturally one starts with the economic problem. Here, as my noble friend Lord Soper said earlier, we are given by one side a set of figures, with a gloss on them which seem utterly convincing, and then we read what is said by someone else on the other side and find another set of figures, with another gloss on them; and they are equally convincing. What surprises me is that when comparison is made it is between this country and the average result for the Six—not with individual members of the Six. But, at the same time, when a comparison is made between EFTA and the Economic Community the results for the other members of EFTA are not taken into account; it is always we who are considered.

I have in my hand the latest EFTA publication, the EFTA Bulletin, just published, and it gives the figures for the growth in trade of the members of EFTA—that is, Austria, Denmark, Finland, Norway, Portugal, Sweden, Switzerland and the United Kingdom—and the development in their export trade with the whole of the rest of the world. Over the period 1960 to 1970 all the EFTA countries had an increase in trade of 111.3 per cent., but this country's increase was only 70 per cent. Each one of the separate EFTA countries had a bigger increase in trade than the members of the European Economic Community. We did not. Nevertheless, we are told that EFTA is no good to us. We are told that in some marvellous way—and this is where the mythology comes in—if we go into Europe (as it is put) we shall benefit. Why"into Europe"I do not know, because there are only six countries, and there is a lot more of Europe than those six countries. We are told that if we go into Europe we shall benefit. But why have we not benefited—

LORD ROBBINS

My Lords, does the noble Lord attach no significance to the fact that some of the members of EFTA are applying to enter the Community?

LORD WYNNE-JONES

My Lords, certainly. But as the noble Lord knows perfectly well, a country like Denmark or Norway, which is closely allied to us in trade, would find it very awkward if we went in and they did not. It seems to me that his argument is an astonishing one, because those countries are so closely linked to us in trade that they are more or less forced to go in if we go in, otherwise there will be a trade barrier put up against them. I would have hoped that we might get a more serious argument than that.

If one looks at the export trade of this country, one finds that, of our total, 47.1 per cent. is export trade; and of that we find that our trade with Europe as a whole is 8.7 per cent. of our total trade. With Canada, Australia, New Zealand and South Africa (which earlier in the debate we were told could be written off relative to Europe) we have 13.7 per cent. of our trade, as against 8.7 per cent. with Europe; and with the developing countries we have 22.9 per cent. This brings me back to the point where I started, that the developing countries are of extreme importance. They are already of importance to us in our trade, but they are of even greater importance for the future of the world. What will happen when we go into a restrictive community—and for all that is said, the Common Market is a restrictive community, if it were not, what would be the advantage in our going in? It is precisely because there are barriers to trade that we say,"Let us get in under those barriers "—and do so at the expense of the developing countries and at the expense of all the countries with which we have had Commonwealth associations. My Lords, this is indeed perfidious Albion. We are being asked to betray not only our own interests but the interests of other countries in order to creep in under this barrier.

We are told that, in addition to the economic side, there are enormous political advantages. I can understand this. I can see that the political argument can be quite a potent one. But we were told by the noble Lord, Lord Gladwyn, that on the contrary there was virtually nothing political about it at all. He said that the Economic Community is purely a Customs Union; it is not really a Community.

SEVERAL NOBLE LORDS

Order!

LORD BYERS

My Lords, the noble Lord is really misrepresenting the noble Lord, Lord Gladwyn, who said exactly the opposite. I read the speech, and I hope that the noble Lord gave the noble Lord, Lord Gladwyn, notice that he was going to attack him in this way.

LORD WYNNE-JONES

My Lords, it is impossible for me, when I speak at this hour, to go and ask the noble Lord, Lord Gladwyn, who is not present in the Chamber, and so far as I know, is not actually in the House. That is not my business.

A NOBLE LORD

Where is he?

LORD WYNNE-JONES

My Lords, if he wishes to come I am quite prepared to wait a moment for him.

A NOBLE LORD

It is misrepresentation.

LORD WYNNE-JONES

My Lords, I would have hoped that the noble Lord, Lord Gladwyn, could take any criticism, although he usually prefers to give it.

LORD BYERS

My Lords, the noble Lord really must get this right. This must go on the Record of Hansard.

SEVERAL NOBLE LORDS

Order!

LORD SHACKLETON

My Lords, is not the noble Lord, Lord Wynne-Jones, going to give way?

LORD WYNNE-JONES

To whom?

LORD SHACKLETON

To Lord Byers.

LORD WYNNE-JONES

No. He does not want to speak.

My Lords, if we look at this political side we find that at the present time we have a nominal Government of the European Community, but this Government is one which does not, as an elected Government, have any control over the Economic Community. The control is through the Ministers, and through the civil servants who are in Brussels. Those civil servants in Brussels can draw up—and they do it, undoubtedly, with very great skill—all the regulations which control the Community, and then these are either approved or not approved by the Council of Ministers. There is no Parliamentary control. In other words, this so-called political control over the Community does not really exist. It has been stated that the real point of the Community is to have the great advantage of expert techniques brought to bear upon these supranational questions, and it is in this way that the Community is supposed to be effective. This may be a good thing if one is concerned with a dictatorship; it is not a good thing for a democracy.

LORD DONALDSON or KINGS-BRIDGE

My Lords, would the noble Lord allow me to intervene, to clear my mind. I understood that the Commission, as the noble Lord said, put up propositions and that the six Governments, represented by different Ministers, passed judgment on those proposals, and if they are serious proposals, there has to be unanimity. Surely this is, for the Six, not a dictatorship. It seems to me to have the maximum right of veto and the minimum right of dictatorship.

LORD WYNNE-JONES

My Lords, this, of course, is perfectly true, but to me this is not democracy. Democracy does not consist in having Ministers from six nations meeting together and any one of them being allowed to veto something which has been carefully drawn up by the civil servants. There is no Parliamentary control; that is the statement I made. In other words, there is no elected control over the Economic Community. This is not possible because there is no vote on a budget. Therefore, it is not possible to have an effective Parliamentary control. It is just as though in this country we simply allowed everything to be done by a Cabinet with no right of interference by Parliament at all. We would not then, in my opinion, be carrying out

anything effectively democratic. I do not mean to say that we do not run into periods when we have partial dictatorship, but we still have the paramountcy of Parliament, and that is not present inside the Economic Community.

I have one final strong objection to this country entering into the Economic Community, and that is the regions. The regions of this country—Scotland, Wales, Northern England and the North-West—will undoubtedly all suffer if we go into the Economic Community. It is significant that although many industrialists think, I believe quite erroneously, that they are going to benefit by going into the Economic Community, the shipbuilding industry of Tyneside is firmly against it. Sir John Hunter of Swan Hunter has expressed himself very firmly against going into the Economic Community because he knows it will be bad for our shipbuilding industry, and I believe what will be bad there will be bad throughout all the regions, except possibly the South-East.

9.20 p.m.

VISCOUNT HOOD

My Lords, I put my name down to speak in this debate for two reasons. The first was to stand up and be counted in support of the White Paper and to join in congratulating our team of negotiators on their skill and perseverance. As I see it, this country has belonged to Europe for 2,000 years, and I think it would be most unnatural for us not to join in an enterprise the aim of which is to restore to Europe some part of the unity which it enjoyed in the days of the Roman Empire. I would echo earlier speakers in saying that I believe we have much to bring to the Community, not simply materially but in human terms, our Parliamentary experience and traditions, the good sense and the fair-mindedness of our people. I believe that our presence in the Community will make it not only a stronger but a more reliable force in the world. I believe, too, that the Community will provide us with the broader base that we need in order to make our influence effective and to enable us to make our proper contribution to the peace and security of the world. I am afraid that the noble Lord, Lord Wynne-Jones, may regard those as rather simple arguments, but I find them convincing and I intend

when the time comes to vote in favour of joining the Community.

My second reason for speaking to-night is to enter the plea that the enlargement of the Community might be made the occasion for an overhaul of other European organisations. In using the term"European organisations"I do not mean NATO nor do I mean the O.E.C.D., both of which have scope and membership extending beyond Europe. I think it was the noble Lord, Lord Thorneycroft, who spoke of the new duties and responsibilities which membership of the Community would place upon this country. I believe he was thinking essentially in terms of industry. I am thinking rather in terms of the new burdens on British legislators, British Ministers, British public servants who will have to attend to the affairs of the Community and the countless meetings in Brussels. It is most important that those duties and responsibilities should be ably and amply fulfilled if in the Community we are to play the full part which we must play in order to reap its benefits.

I believe that the talent, the resources and the time that we can devote to this sort of activity is limited; that in future we ought to give priority to the Community, and that we should use its institutions to the greatest possible extent in maintaining and developing European co-operation not only between the members of the Community, but between them and other European countries. Where another European organisation is composed entirely of members of the enlarged Community, I would see a prima facie case for winding up that organisation and for such activities as seem worth carrying on to be carried on in future as part of the activities of the Community.

A case in point is Western European Union. This provided a most valuable link between the United Kingdom and the Six, so long as we were not a member of the Community. Now that we are inside the Community, I do not believe that we need any such link. In the footnote on page 3, the White Paper reminds us that W.E.U. merged its defence arrangements in NATO long ago. What seems worth considering is whether the remaining arrangements of W.E.U. should not now be merged in the Community. The political consultation and co-ordination of foreign policy which had begun in W.E.U. should now be continued and intensified in the enlarged Community, and the small and able secretariat of W.E.U. might serve as the nucleus of the political commission of the Community.

Hardly less important than the development of co-operation between the members of the Community is the development of co-operation between them and other European countries. It may be that no other European country is able or willing to apply for full membership of the Community. But there are many fields—economic, cultural, scientific—where co-operation and, indeed, common European policies might usefully be developed between the members of the Community and other European countries. The White Paper mentions that association agreements and arrangements have already been negotiated with some European countries, and that others are to be negotiated in the future, notably with the members of EFTA who are not becoming full members of the Community. It seems to me that these agreements and arrangements might provide the basis for the wider European co-operation which the noble Lord, Lord Hankey, suggested (and with which I agree) and might be extended even to both sides of the Mediterranean. If provision could be made in those agreements or arrangements for meetings between Ministers and Parliamentarians of the countries concerned, we could then perhaps wind up other separate European organisations like EFTA or even the Council of Europe.

Since we first applied to join the E.E.C. we have been very sensitive to the charge of being bad Europeans. Tactically I think we were probably right to respond to appeals to our European-mindedness, as failure to do so would have discouraged those who were trying to get us into the Community and have provided ammunition for those who were trying to keep us out. But the result has been a multiplicity of organisations and problems. Now I think there is a chance to introduce some economy and some order into what is rather a confusing picture. If we attempt it, do not let us be deterred by the charge that we ale being bad Europeans, because from now on the only true test of our European-mindedness will be the extent and the quality of the contribution we make to the life and development of the Community.

9.27 p.m.

LORD ORR-EWING

My Lords, as I understand it, I am speaking 28th in this debate, and if I have kept the score correctly there are 23 in favour of joining the E.E.C., one sitting on the fence (now sitting on the Front Bench), and three against. If one is speaking 28th one has to concentrate the mind on certain facets, and I am going to try to concentrate on live simple facets of the argument: First, the size of the Market and the resultant effects on our industry; secondly, the results in the E.E.C. countries since its formation, and the comparable results in the United Kingdom; thirdly, a brief look at where the militant opposition to the E.E.C. comes from, and to our joining it; then a word on defence; and, lastly, a word on the need for an early and a positive decision.

I turn first to the size of the market, because having been brought up in industry and in technological industry, mainly electronics, I see most vividly that although we, as a nation, have spent more per head of our population on research and development, we have seldom harvested the full results of this effort. I refer in particular to such industries as aerospace, electronics, nuclear engineering, chemical engineering, and the like. I do not wish to concentrate the minds of your Lordships solely on large companies, because I think that the same argument applies to the medium and small-sized companies. None of these companies can continue to spend on research and development on the present scale unless they are afforded a larger market. It not only must be a larger market, but it must be a rich and sophisticated market. I would argue that with our 55 million people we cannot continue to"go it alone "; but as part of a consortium of 270 million people, with a purchasing population at least comparable with, if not greater than, the 205 million people in the United States, we shall have a good chance of maintaining our position and our goods in a competitive position, and certainly of achieving good sales.

I know (and I have heard all these arguments) that whatever criteria you take, someone can take the other criteria. The noble Lord, Lord Wynne-Jones, used this argument, and I contend that that is absolutely right. I want to take the four criteria which I believe important. First, the rate of growth of the g.n.p. in the last 10 years, in the Common Market and outside it. I concede that the growth varies between the different countries of the Six but, on the whole, during that period it has averaged something between 4.5 and 6 per cent.

If we look at our growth, we see that it was 2.9 per cent. in the same period, rather less than half that average. If we look at our industrial investment, we find the same sort of figures. We have invested at about half the rate of the Common Market countries. If we look at the growth of our overseas trade, we find that whereas between 1961 and 1968, E.E.C. overseas trade had nearly doubled, ours had risen by only about 50 per cent., half as good as the E.E.C. countries. If we look at real wages, which must determine the prosperity of the nation as a whole, we find that 10 years ago the average industrial earnings in this country were £2 a week more than our opposite numbers in the E.E.C., whereas to-day they are £5 a week less.

I would like noble Lords, when they travel on holiday or on business in Common Market countries, to notice the growth and prosperity compared with the comparatively slight growth in our own standards. I perfectly well acknowledge that there are other variables in this equation—the starting position, the Government of the day, taxation, the welfare schemes which exist here, the dynamic of growth, not only here but all over the world—all these are variables. Not the least variable of the variables are the Treasury advisers, whom various Governments inherit and who seem to me not to be the most dynamic and pro-growth of our 55 million people.

Your Lordships may ask why, if the case is as strong as we try to make out, are there people who oppose it? I have been looking through the history of the Common Market in 1958, and I remember visiting Italy and Germany at that time. It was noticeable that the most militant opposition came from the Communist Parties of Italy and Germany. They have changed their opposition, of course, because the prosperity there now means that there is no advantage for them in being against the Common Market. We have to bear in mind that two of our largest trade unions are under Left Wing leadership, that of Mr. Scanlon and Mr. Jones. It can be that they are not typically representative of the millions in those unions or of the trade union movement as a whole.

I was present on May 10, 1967, at the debate in another place (the noble Lord, Lord George-Brown, referred to it in his admirable speech), when the vote was a massive one in favour of negotiation—488 for and 62 against. I found a strange coalition between the Little Englanders on the Right and the Left Wing of the Labour Party. I recall that the Tellers on the one side were Mr. Michael Foot and Mr. Ian Mikardo, and I do not think anyone would say they were in the centre of the political spectrum. One has only to read the Morning Star, which I do assiduously, to see that there is strong opposition in that quarter, but that is perfectly understandable, because the last thing a Communist wishes to see is a strong and united Europe, united in mind and in economic and foreign policies.

This leads me to my next point, which was touched on by the noble Viscount, Lord Hood. I am worried about the whole trend in the defence of Western Europe. Canada has halved her contribution to NATO. On a recent visit to the United States I was appalled to see just how demoralised that nation has become, and how deeply Vietnam has bit into its soul and into the universities. I cannot help feeling that as a result of their Vietnam operation they are in a mind to withdraw their troops not just from the Far East, but to follow that tendency and withdraw before very long from Western Europe. Of course, the argument will be used that they can be brought back in these new, massive C5A transport aircraft, but I cannot also help reflecting that it is troops on the ground that count, and not troops 3,000 miles away, if someone wishes to make a challenge to the stability of Western Europe.

So with this tendency taking place, with Canada already cutting down its contribution and with the United States clearly destined to cut its troops—and they have 300,000 helping in the defence of Western Europe—I see it of supreme importance that we should be a strong and united member of the E.E.C. I know it is said —and my noble friend Lord Carrington said it in his opening speech—that Defence is not written into the Treaty of Rome. I acknowledge that. But, surely, if we are united on economic policy, if we are united on political policy, if we are united on foreign policy, we must be more nearly united on defence policy as well; and I believe that it is in this area that we have a considerable and most important part to play.

Lastly, I come to the need for a positive decision. I would say in parenthesis that I hope no members of our Commonwealth will think that by entering Western Europe and the E.E.C. we are turning our back on the Commonwealth. We are merely acknowledging that their trading pattern has changed, is changing, and is going to continue to change. When I have discussed this with my friends in Australia, Canada and elsewhere they have always acknowledged that an economically strong and rich United Kingdom will be of benefit to them just as much as it will be of benefit to us. But I would say that if perhaps our trading ties become less secure, then I hope we shall find ways to strengthen our emotional ties with the Commonwealth. We can do this by an exchange of students and by making it easy for people to take up holiday jobs in both directions, perhaps by having special rates in off-peak periods and using transport aircraft of our air corporations, and even of Transport Command. These are ways by which I think we should seek to strengthen the emotional ties if we are weakening the others. For we must never let it be said that we have turned our back on, and by making a new arrangement are rejecting, the Commonwealth. We are not.

As to the need for an early decision, I believe most sincerely that the opportunity, which it is for us to take perhaps at the end of October, will not occur again. Of all decisions, a decision to stop a slide of prosperity is the most difficult one. If you diminish your wealth or your comparative position or your comparative influence in the world by 2 per cent. per annum, it is very difficult for any Government to say,"Stop! We have gone far enough ". Britain is particularly liable to a sleepiness, and to prefer no change when things are going reasonably well. I think your Lordships will recognise that even in World War II it was not until 1940, when the bombs started dropping on London, that the nation girded up its loins and started to work flat out. So I say, do not let us have our position, our influence and our wealth gradually diminished, as it will be if we do not go into the Common Market, because then it will be much harder to make a decision which could jerk us out of any somnolence which may exist.

I believe that E.E.C. entry will jerk industrialists and trade unionists into facing reality, for either our goods are competitive in price, competitive in design, competitive in endurance, competitive in the service which is provided for them, or the United Kingdom is not able to support 55 million people. That is the stark choice between us. Outside the Community I believe we shall slide gently into becoming, over the next few decades, a potato economy, and I cannot believe that your Lordships think that this is the right destiny for Britain. I would advocate the acceptance of these terms. Let us accept this challenge; let us join and use our political, economic, industrial and military wisdom for the good of the Free World.

9.40 p.m.

LORD INCHYRA

My Lords, I apologise for the fact that I doubt whether I shall be able to be here on the Wednesday when the debate is concluded for I have to be in Scotland on that day. I ought also to make this further apology, that in view of all the speeches that have been made and the arguments advanced in favour of joining the Community, it is difficult to find anything fresh to say. However, my justification for adding one more speech to the debate is the fact that I was Permanent Under-Secretary in the Foreign Office in 1961, at the time when the Government decided to make their first application for membership. In that capacity I naturally listened to all the arguments and considerations which were advanced on both sides of the case. I suppose I took part in a good many of the discussions which led up to the final decision, and all I need to say now is that at the end I was convinced that it was to the advantage of this country to make an application to join the Community.

I was convinced of that matter then, 10 years ago, and I am even more con vinced now. I must say that in spite of the strength of the economic arguments in favour of joining, which were very, very considerable, it primarily was the political arguments which influenced me. That was perhaps natural because primarily my job was to consider that aspect; but I came to the conclusion that if we wished to maintain and to further British interests, not only economic or financial but our international interests and our defence interests, it was really quite hopeless to think that we could do so alone any more. It was really essential that we should be in the decision-making body; otherwise there was grave risk that matters which concerned us vitally on the economic front, on the political front and perhaps even more on the defence front, would be decided either in our absence or by bodies on which we were not represented or were rather feebly represented. I came to the conclusion that if we wished to carry on as a country which mattered it was essential that we should be on those decision-making bodies and that there was no future for us standing on our own.

I was also influenced by the fact—perhaps I am old-fashioned, but I still feel this—that this country through its history, its traditions and its experience, can make a valuable contribution to world affairs and to the development of the world in general. I felt that if we were to continue to be able to make that contribution we must be in the Six. We should not be able to assert that influence, as we should like to do, alone. Those considerations led me to the conclusion that, on political grounds as well as economic grounds, it was in our interest and in the interests of Europe and the world as a whole that we should join the Six. That was in 1961.

I must admit that I was a convert. Earlier on, I had been of the opinion that we should do better to stay out. In the late 1940s and early 1950s, at the time when the European Movement was just getting under way, it was my view that we should do better to stay out; that we could in some way, thanks to our Commonwealth connections and for other reasons, form some kind of link or balancing factor between Europe on the one hand and the United States on the other.

I was in very good company in thinking that. I rather think the noble Lord, Lord Carrington, when he opened the debate to-day, said that he too had not been converted to the idea of joining the Six until the comparatively late 'fifties; and even the noble Lord, Lord Gladwyn, admitted that about the middle 'fifties he had similar views. However that may be, it was the considered opinion of Her Majesty's Government at the time that that was the right policy. I remember being sent to give a lecture to the United States War College on the theme, not of concentric circles but of three circles: one in the United States, one in Europe and one in the United Kingdom, in the middle. I am glad to say that my master who instructed me on that occasion, judging by to-day's paper, has now also changed his mind. However that may be it was the opinion of Her Majesty's Government at that time. Fortunately, my audience at the war college paid little attention to what I said, particularly as my lecture was sandwiched between lectures by two very distinguished British Field Marshals.

We were all wrong, and although I have an alibi for the noble Lords, Lord Thorneycroft and Lord Boothby, who spoke earlier, I could not agree more with what they said. I suppose that we were still living in a world of make-believe, thinking that we were in the world before the war. We were hypnotised by the rather special position we had held during the war; we still thought that the Commonwealth meant something rather different from what it did. We still thought that our special relationship with the Unied States put us in a peculiar position. In fact we thought we could still operate as a major Power, as we had done in the 1920s and 1930s. It was not until the late 1950s that it gradually dawned on us—when I say"us"I mean the Government of the day—that that was no longer practical politics.

Our economic situation was gradually deteriorating; our power to exert any influence outside Europe was diminishing. We found that the Commonwealth was evolving in a rather different fashion from what we had perhaps expected, and that we were no longer in a position to operate as we had hoped.

And for myself I say, advisedly, that it was only after the Suez episode that it dawned completely on me that we were no longer really in the"First Division ". That being so, the problem is how to accommodate ourselves to the new circumstances. In 1961 the Government, rightly, in my view, came to the conclusion that the proper thing to do was to join the Community. If the arguments which applied in 1961 were conclusive then, I think they are even more conclusive now. Not only has our relative economic position deteriorated but our ability to exert any influence outside Europe has diminished, and generally, I should say, regretfully, but I think truthfully, our status has not improved in the last 10 years.

That being so I think it is even more essential than ever that we should not allow ourselves to get into a position where decisions affecting our interests, vital interests, can be taken in places where we are either not represented or cannot exert any adequate influence. The idea of associating ourselves in some way in the countries of North America has been proved to be a non-starter. The Commonwealth is equally not suited to this purpose. In the circumstances, unless we are to remain isolated, I see no alterative but to join the Six.

Unlike some converts, I am not wildly enthusiastic about my new faith. That is not because I do not recognise the great economic benefits, and indeed the great political benefits which we may hope to derive, and which, if we play our cards properly, we shall derive from association with the Six. It is, I am afraid, partially from a feeling of nostalgia: not so much for the days when the map of the world was half red, or when our children's stamp albums were nearly full of stamps bearing Queen Victoria's head, but more from the days of the 'twenties, or the early 'thirties, when we really did have an influence all over the world. Looking back to those days, it is almost inconceivable to think that major events can take place in the Far East, and still more in the Middle East, without our Government being consulted and having a major say in what happens. Naturally, one has the feeling that one would like to get back to that state of affairs. But that is pure emotion and pure sentiment.

Equally, I must confess that, in spite of all the years that I have spent abroad, in spite of the fact that I am married to a foreigner and that I have a good deal of foreign blood in my veins, I still do not feel terribly akin to foreigners; I still feel somehow that the British are different and that I should like to be able to go on as we were before. That is all wrong; it is a nasty, nationalistic, wrong sentiment; but there it is. However, one has to disregard those feelings: one has to be realistic, and to treat the matter on its merit. To my mind, there can be no doubt that in the interests of this country we should join the Community. But again I say that I am influenced not so much by the benefits that we shall derive from joining the Community, but by what to my mind will certainly be the disastrous result if we do not join.

Finally, my Lords, I may say that I have been careful, for good reason, to keep off economic matters; but, as a Scotsman, and coming from the part of the world that is closely affected by the particular issue, I should like to echo what the noble Lord, Lord Polwarth, said about the importance of hill farming, fisheries, and, above all, regional development planning.

9.53 p.m.

THE MARQUESS OF EXETER

My Lords, I assure your Lordships that I will not keep you long this evening: first, because it is getting late; secondly, there are a number of noble Lords who still want to express their view; and thirdly, I have an horrific historical example before me, because I read the other day that the daughter of an ancestor about 400 years ago married the Lord Oxford on the day when he got out of the Tower, where he had served no less than 20 months for the horrible sin of"prattling too much in Parliament ".

On this occasion, it has been most warming to see that your Lordships' House has gone to just the same heights that one always expects, and as it always has in the past. There has been little cut-and-thrust of Party politics: everybody has been looking on this as one of the greatest historical decisions that we have ever been called upon to make, as it is. A whole lot of points of view have been put, and the subject has been covered from many angles by many noble Lords who can do it much better than I can. But there is one angle about which I should like to say a word or two, and it is perhaps, after the height of the debate, rather lower down; that is, the practical angle of commerce and industry, from someone who has spent the last forty years in getting his daily bread in it.

I think that one of our troubles with the public outside is that the anti-Marketeers had the whole of the field to themselves for many months, and they have built up an enormous smoke screen; many minor points were built up into importance, and others were put which will not bear very close analysis. No one could reply because the leaders of all of the Parties naturally had to keep quiet at that time. The reason is that if one wants to get a good bargain the last thing one should do is to appear anxious to obtain that bargain. Undoubtedly the"ante"would have gone up if we had done so. To pierce this fog is what I believe we must do. We have a rather special position in this debate which perhaps we do not always have. I believe that in this fog there are an enormous number of people who really want to get at the basic facts. There are confirmed Marketeers and confirmed anti-Marketeers, and somehow we have to bring home to the middle group the basic facts. Therefore, what goes out from your Lordships' House, where there is not so much Party pressure as there is in another place, will be listened to attentively. That is a very important point.

If we are going to take that line we must give some of the reasons which have brought us to the conclusions we have reached. So far as the industrial world is concerned, one has to bear in mind that it is never static; it is moving all the time, although we may not notice it. New inventions are brought about, new types of engineering, new discoveries of raw materials. There are new trading partners, the quickening of communications, and a hundred other different reasons why it is on the move. How can we keep 55 million people in this tiny country with the only raw material which it possesses, coal, a small amount of iron ore, and half its food? If one goes back in history the original reason must be that we were the first people who were both far-sighted and prepared to take the risk to dip our foot into engineering waters. Everyone had to come to us to buy what they wanted, and out of our surplus—and I underline the word"surplus "—we were able to make a great deal of investment overseas.

This position started to alter almost immediately, and in a few decades already other countries had built up their engineering strength—Germany, France, America and others—and the position was changed. Then we came to Ottawa—I remember it well, I was in another place at that time—where we tried to stabilise the position and gave advantages to the Commonwealth to bring in their raw materials; they gave advantages to us to take in our manufactured goods. But that was 40 years ago, and things have not stood still since then. Other factors have come into this question: Canada now has an immense, strongly based industrial economy; Australia has the same; New Zealand has not, and we are happy to see that a satisfactory arrangement has been made for it and also for those countries producing sugar.

Something else has been happening all this time. Simpler forms of engineering products are now being made in other countries. We are inevitably being pushed more and more into sophisticated engineering of two kinds: one is the very difficult kind, electronics and the like; and the other is the mass production units such as motor cars and the like. They offer a very special problem which applies also to smaller industries, and then there is the size of the market. What does it mean in practice? I was chairman of a radar company which sold radar for ten years. It was not unusual to have four years of development before a single unit was sold. Someone had to pay for all those overheads and for the research people over that period. If the motor industry sets up a production line for a new model there is no change out of £15 million. That has to come from somewhere. The only way it can be returned is by the number of units that can be sold and particularly overseas. If one does not sell enough because there is not a large enough market, one might as well not start, because nobody owes the British Lion a livelihood. Three things are necessary: the right goods, the right quality and above all, the right price. Unless those attributes are present the goods will not be sold. Any interference from another country, such as a tariff, means that it is harder to sell goods.

When industries have to make up their minds whether they are going for a longer term scheme to try and sell goods overseas profitably, which they have to do, they are going to take all these factors into account. Here is our chance. Here in the industrial world is a potential very wealthy market of 300 million people, when we are all in. Surely it must be right to go in. Here is a Market without tariffs or any other interference. To take the other argument to the other extreme, would the United States really suggest that they would be more prosperous if they had tariff barriers between North and South Carolina, and between all the different States?

It must be right to go into a big market if we are imbued, as I know we are, with the same spirit as we have always shown in the past. We have this tiresome habit of belittling our performance. We have some of the best inventive geniuses in the world; we have some of the best management staff in the world, and we have some splendid people working on the benches. On the shop floor we have a huge advantage over many countries, because for generations the men have been used to working in that environment and within engineering limits, so that it comes as second nature. We have these advantages, and it is up to us whether we make use of them or not. I cannot believe, looking at all these advantages, that anybody could conceivably say,"Keep out ". If we did, all the world would say,"They are too frightened, and all they are doing is looking back in nostalgia on what happened years ago ".

My Lords, I hope that when the time comes in October we shall grasp this; that we shall go into the Common Market. And, meantime, I think that a clarion call should go out from your Lordships' House explaining the basic facts and pointing out that we are not thinking just of ourselves, but of our children and of our grandchildren for the years ahead. We have it in our power to harm them or to bring them prosperity, with a real voice in world affairs. I feel that if we are once more brought back to the understanding that these are the real principles at stake, we need have no fear but that the majority of the populace will, when the time comes, approve our entry.

10.2 p.m.

BARONESS SHARP

My Lords, the noble Lord, Lord Carrington, said at the beginning of this debate, that he did not really think that there could be anything new to say. It seemed, however, that over 100 Peers had taken a different view. I do not take a different view. I was quite sure before the debate started that, as far as I am concerned there is nothing whatever new to say, and I am more sure than ever about that now. I have no special knowledge, nor am I particularly well informed; but in this I am representative of the millions of people in this country outside Westminster and Whitehall who are now beginning to try to make up their minds about the issue before us. What I should like to try to do this evening is to say very briefly how it seems to me that the argument is beginning to present itself to ordinary people up and down the country. They certainly are beginning to think about it. The opinion polls suggest that, and there was one tiny incident two or three days ago, which occurred in the little shop in my small village. While I was buying groceries the man suddenly looked up in the middle of wrapping them and, apropos of absolutely nothing—unless it was the butter—said,"I think we've got to go in, don't you?"Nobody had mentioned the Common Market or anything to do with it. He was a little anxious and worried and he had been thinking about it and had arrived at this conclusion.

My Lords, I do think we have to go in. I have indeed thought so ever since the Economic Community was first started; but up till recently I had thought it from a rather emotional or, perhaps I might call it, a political point of view. It is only now, when the conditions are agreed and the debate has begun, that I have started to try to rationalise why it is that I want to go in and whether it is really the right decision—this is the mental process that millions of people are putting themselves through now over the country.

It seems to me, as I think to most of us, that two things clearly emerge. One is that it is now or never—that is to say, never within a foreseeable period of time. It is nonsense to suppose that if we reject this opportunity now we can, in a few years' time, when some of the arrange ments in the Community may have changed, when our position may be stronger, when we may have a different Government, take this up again; and that the countries of the Community would then be prepared to consider an application from us. I feel sure that this situation is generally understood in the country, and this is why people are saying,"We must make up our minds."

The other thing which seems to emerge clearly is that the argument is not about the terms of entry. I could not answer an examination on the terms that have been agreed, still less on the Treaty of Rome. But I am entirely persuaded by the arguments that have been put forward that the terms we have now been offered are as good, by and large, as we could ever hope to get, and are acceptable by us without disaster. I do not think the argument is about terms; the argument is simply: do we want to join or not? We have to decide now.

As has emerged clearly during the course of our debate, the argument has two main strands. The first is the economic argument. We all understand that food prices will go up and that we shall lose the advantages of Commonwealth preferences and cheap food. Against this we hope that we shall get the opportunity of earning a substantially better livelihood in the great market of Europe. As has been said in this debate by people who know a great deal more than I, we cannot be sure how this will go; we cannot put a figure to it.

No doubt in the first few years we shall have a rough time, and no doubt any Government responsible for making the final decision will have a rough time. Nevertheless, we all can see that here are great opportunities. And we ask if we reject this opportunity what is the alternative? We do not want to stay where we are—I think we are all pretty clear about that. It seems to me that the opponents of entry have never made clear their alternative suggestion to entering Europe. What makes them think that if we stay as we are, outside the Market, we can do substantially better?

What is our situation? We all know it. It is slow growth and, above all, a low-wage economy. What has struck me for years, perhaps because of my long connection with housing, is what a depressingly low-wage economy we have. We have to recognise that millions of people in this country, in good, steady jobs, cannot afford a house without having a subsidy handed out to them. What a miserable situation! We all feel that this is a situation that we desperately want to get out of; and we ought to be able to get out of it. As has been said in the course of this debate, we have great confidence in our ability to earn a good livelihood. Somehow we have not managed to do it; somehow we are not competitive in Europe; indeed, we have not had the chance of being competitive in Europe. This is how the economic argument presents itself to us. Of course it is a risk, but it is better than staying where we are. If it is a risk, it is also a chance. My Lords, let us take the chance.

The other argument is of course the political argument. I must confess that on the political side I myself have for many years wanted to see a more united Europe. It seems to me that our only hope in this country of a more civilised life in future is a more united Europe. I remember, in the early days of the war, agreeing with a number of friends that the one thing I hoped we would manage after the war would be somehow to reach an agreement among the countries of Western Europe on certain basic human rights: on freedom within the law, on certain personal liberties—the things we had seen so appallingly ignored and destroyed in countries of Europe and which were really at the basis of the war.

After all, in Western Europe, in spite of all our differences of law and of custom and of methods of government, and in spite of all the crimes that have disfigured our history for so long, we have a common tradition, a common culture, common ideals. We have the possibility of agreement among ourselves on respect for personal liberty; the kind of liberty we in this country have secured and in which most of the countries of Europe believe we can agree to on respect for democratic forms of government. This perhaps is not germane to the Economic Community, yet this to me has always been the vision. Noble Lords have spoken tonight about their visions of a future Europe. This is more. It may not be germane to the Economic Community, yet the Community is the first great step along the road towards some kind of unity in Europe which may one day lead to some kind of agreement, perhaps even an agreement that we were all prepared to enforce, on respect for basic human rights. That, my Lords, at the bottom of it, is why, above all, I want to see us join Europe, although I will accept that there is no possibility of our joining the Community unless the economic arguments are right. But at this stage I believe that they are.

10.13 p.m.

THE EARL OF SELKIRK

My Lords, it is always a great pleasure to follow the noble Baroness, Lady Sharp. My only regret is that the noble Baroness does not speak to us more frequently in this House. I know that her presence would always be greatly welcomed.

I am very glad that the Government have postponed a decision on this subject, because public opinion has quite a long way to go yet in accepting the policies which the Government have put forward. The situation is not eased by the political shadows which hang over our heads on this general topic. We have had an interesting debate in which the speakers have been something like 10 to 1 in favour of the Government's policy, relieved by a certain euphoria (shall I say?) from the noble Lord, Lord Wynne-Jones, and the noble Lord, Lord Granville of Eye, who have fortunately given a slightly different point of view. I think this is wise. But if I may say so to the Government, although they have won the Parliamentary debate, they have quite a long way to go yet to win the public debate, and it is that which I am going to ask them, if they will, to give rather fuller attention to. My noble friend Lord Thorneycroft said it is of the utmost importance that the nation, and not simply Parliament, should recognise that we are going into the Community.

When Mr. Macmillan put forward his proposals in 1962 I was in Singapore and I was a little surprised, I must admit, at what I understood to be the agreement of commerce, industry, the professions and the trade unions; they all seemed perfectly willing to join. Today, as I read it, the situation is rather different, for good or for bad, and I think one of the reasons is that the country has understood, or begun to understand, some of the implications, and is a little disturbed at what it sees. I wonder whether the Government can give us a little fuller understanding of what they have in mind.

First, there is the Treaty of Rome, an immensely complex document, and really nobody can say what the implications of it are. I would be grateful if the noble Marquess could say what are the limitations of the implications. Various documents come to me from time to time: some of them speak of a full union of the nations of Europe. I do not suppose for a moment that the Government can tell us the full position, but let us hear something of it. You can argue, if you like, that the document is not perhaps anti-British. But it certainly completely ignores any British interest at all. Much of this has been alleviated by the very able negotiations on the part of the Chancellor of the Duchy—I accept that entirely—but none the less the implications of the Treaty leave a certain inclination.

I find it hard to understand how he can readily accept the Common Agricultural Policy without comment.

LORD BESWICK

Hear, hear!

THE EARL OF SELKIRK

My Lords, I do not think the price of butter, or even New Zealand, is what matters, but basically, from a world point of view, it is a thoroughly bad economic policy. It is encouraging high cost agriculture and discouraging low cost agriculture. In the long run that is bad, and I would very much hope that the Government would try to find ways and means of putting this on a better basis. I suggest straightaway that they should endeavour to reduce the level of duty which the Common Agricultural Policy imposes. I personally doubt whether any such policy would be ever likely to work for the whole of Europe. It is not dead easy to have a Common Agricultural Policy for this country alone.

Another point is that the form of Government which is suggested is very highly geared. It will inevitably be rather in sensitive to the opinions which are expressed to it. This may not matter very much, but it will mean that our opinions will be much less sensitive to opinions expressed in other countries. As to the normal Government—if I may say to the Front Bench here, which is a normal Government—sometimes we regard them as being rather insensitive to proposals put forward. I may say that other Governments have also been insensitive to proposals which have been put forward from time to time. Perhaps I may take the case of fisheries, which have been discussed here today. I should have thought anybody knows that if you do not preserve fishing you will destroy it. Yet as far as I can see the Council of Ministers took no immediate action on this. I am only suggesting this as an example, and maybe it will eventually be borne home to them that this is a matter upon which action must be taken.

My Lords, I am sometimes disturbed by the statements which are made by very keen supporters of the Party. The noble Lord, Lord Wynne-Jones, mentioned one or two, and I will give him a couple more, if he is interested. If you want to know the country whose gross national product has increased most in the last 10 years, it is Denmark; and if you want to know the country with the greatest per capita contribution to gross national product, it is Sweden. These are countries outside the Common Market. One can go on quoting these until"the cows come home ", I quite agree.

Again, on the subject of sovereignty, which I understand the noble and learned Lord the Lord Chancellor will deal with tomorrow: we have had all sorts of statements about sovereignty. Sometimes it does not matter, sometimes we have lost it already, sometimes it is only a small matter and of no great concern. I would only say that my recollection of studying sovereignty was that no one could ever find where it was. They looked about the country to find whether it was here or whether it was there. Sovereignty seems to me to be where recognised authority is, and my anxiety is whether the authority of the Commission will be recognised. This seems to me to be very important indeed. It is no good setting up an authority unless in fact it is recognised.

My Lords, I have no doubt at all that we are going into Europe. Indeed, in my opinion if we did not go in the evils would be very great indeed. We have gone too far along this course, and we should do a great deal of damage to many people besides ourselves if we did not go in. I think we should ask the Government whether they can tell us a little of what they are going to do when they do go in. I do not take quite so easily as the noble Lord, Lord Orr-Ewing, the position of the Commonwealth. I believe the bilateral arrangements in the Commonwealth will remain, but we should think very hard whether as an institution it is going to have a very long term future. This is one of the prices we pay, and we must not delude ourselves into thinking anything else. I think we can do something to ensure that members of the Commonwealth are more securely associated with the European Community if we go into it.

We have tried the Commonwealth, a free association of nations, without binding any of them, and I am afraid we must say it did not work. We are now going into an association where we contemplate majority decisions. It may be that this is right; but it is taking risks which I think we must recognise. And we are doing this in a community in which we have no common language, no common loyalty and no common fear—the basis of most human societies, I regret to say, but this is the case. Of course we have geographical association. But if it is to mean anything at all, this means that we must cultivate the habit of working together, and for this we require the highest qualities we can produce in this country.

I say one more thing. It is sometimes a common fault to load international organisations with greater duties than they can perform; we may expect too much of them. I think it would be a great mistake. This growth, if it is to be worth anything, must come very slowly indeed, and if we do too much with it I think we shall make a great mistake. I hope we shall try to find ways and means of associating ourselves not only with the African countries, of which the Community think a great deal, but also with the Asian countries, not least with Hong Kong, to which I feel a great sense of responsibility. Let us not forget, either, that the centre of world population is South-East Asia. There, half the population of the world lives: the ablest and most vigorous section, in many ways, of the whole human race. Do not let us cut ourselves off from this area of far-reaching importance. We have drawn EFTA in. It is our task to see that they have a reasonable chance of associating, possibly by special treaty, with the European Economic Community. I say, with respect, that we have a very close relation with those countries and we should see that something is worked out.

The noble Lord, Lord Hankey, referred to the United States of America. Let us not run the risk of any form of trade war. Here we have a very special duty. I should like to say one other word on regional policy. The White Paper is often very thin on this matter, to which a great many people, certainly in Scotland, attach the utmost importance. The noble Lord, Lord Polwarth, referred to it with great force. I would emphasise the absolute necessity of air communications with the outlying parts of this Island if they are not to become derelict areas. This aspect has been grossly neglected up to the present time. It is a strange fact that employment always seems better near the capital towns. In Dublin there is no unemployment it is so different in Belfast. In most places the capital seems to collect employment.

I feel a little like the noble Lord, Lord Inchyra. I cannot say that I am immensely enthusiastic, but I believe that this is a task well worth while. I remember that when I first went to France there were octrois outside almost every town. This has disappeared. I remember living with French and German families, and each of them said how happy they were to see the Communists succeeding in the other countries. Those are days of the past. We must play our part and see that France and Germany continue the association which they now have.

10.25 p.m.

LORD TANGLEY

My Lords, for the first time in my life, I feel quite certain that your Lordships will be pleased to see me on my feet. You can now take up your pencils, strike out No. 35 and say,"That's the lot ", except of course for the reply of the noble Marquess, Lord Lothian. I am one of those lucky people whom I thought the noble Lord, Lord Carrington, envied a little, in this respect: that I have been a convinced believer for twenty years, and an active worker in my limited field towards a European Community for at least ten years. I think the noble Lord was a little envious of people who could claim that sort of record, and I can. Therefore, what I have to say to your Lordships must be slightly in the nature of a confessio fidei. But I am not going to take you over the whole ground of my faith, and I am not going to weary you at this time of night by talking about all the points which I believe give reason and rational ground for my faith. I shall confine myself, if I may, to three points.

The first is this. I do so agree with noble Lords who have scouted the idea that we are a feeble and effete country that cannot stand on its own feet. We are not feeble suppliants for admission to the European Economic Community. It is certainly not for us to creep or crawl under the protection of some Common Market network. The plain fact is that we are a very rich and still powerful nation. We have given great gifts to the world, and I believe that we have still greater gifts to give to the world. We founded a great Commonwealth of nations, and we were so mature in our thought that we have actually had the courage to go through the process of handing it over to the component countries, as and when they were able to assume that responsibility. That is something which had never before happened in the world; but we have done it and it is something of which we ought to be proud. We have created prosperity such as the world had never known before. We have carried through a social revolution by entirely peaceful and constitutional means. In discussing this subject and thinking what we should do, I believe we may hold our heads high.

But while we do that, let us also remind ourselves that the foundation of all these achievements lies in one absolutely ineluctable truth. We hold our position on one condition; that is, that we export enough services and manufactured goods to exchange for the necessary raw materials and food. If we cannot do that, we cannot do any of the other things to which I have referred. We cannot sustain our employment. We cannot sustain our standard of living. We cannot sustain our political or domestic stability. We can be of no use to NATO, of no use to our American friends and allies, of no use to Europe, of no use to the Commonwealth and of no use to the rest of the world.

With that overmastering fact in mind, should we not look at the common markets that already exist to-day? The United States has a common market of about 250 million people, with freedom of exchange of goods and services within it, and a moderate tariff around it. Europe already has a common market of some 250 million people, with freedom of movement of goods and services within it, and a protective tariff around it. Behind the Iron Curtain there is a common market of uncounted millions, controlled and directed from Moscow. In this country there is a common market of some 50 million. Unfortunately there is not, and there never can be, a Commonwealth common market, for reasons which noble Lords have already laid before the House to-day, and with which we are perfectly familiar.

We are now offered the opportunity of joining our common market of 50 million people with the existing European Common Market of about 250 million. Within a measurable space of time goods and services will move freely throughout the whole area, with only a moderate tariff barrier around it—a tariff barrier, let us not forget, which we shall be well able, with our overseas interests, to influence in the direction of freer trade with the other common markets I have mentioned. This is a crucial question: shall we find a better market for our exports, on which everything depends, if we go in, or if we stay out? That seems to me the really crucial question on the economic side of things. But this question far transcends purely economic considerations. I do not like the contrast between economic and political considerations (although I know it is difficult to avoid, and very few noble Lords have managed to avoid it to-day), but the economic situation is only part of the picture.

Sometimes—and several times to-day—I have heard noble Lords say that the question is,"Shall we enter Europe ". With great respect, that is not the question. We are part of Europe. As the noble Viscount, Lord Hood, said, we have been a part of Europe for 2,000 years. I was very interested in one of the quieter asides of the speech of the noble Lord, Lord George-Brown, when I heard him make the same point, that we are a part of Europe. We have been a part of Europe throughout all our history. There is no need to go so far back as the Roman Empire, 2,000 years, as was suggested by the noble Viscount, Lord Hood. There is no need even to go so far back as Charlemagne. Of course, Englishmen were his civil servants; an Englishman crowned him in Germany. We need not go back as far as that. All we need to do is to remember that ever since the mediaeval system broke up, and the national States became independent national sovereign States, we have been in a state of perpetual war in or about Europe. It is true that many of our wars have extended throughout the world. Each war has seemed to extend further, and to be more intense on the periphery. Many of our wars have been fought up and down the Spanish Main, the East Indies and the West Indies, the African coast and the sea, and elsewhere; but they have all been fought for the balance of power in Europe. It is no coincidence that the greatest number of millions of our dead lie buried in Flanders fields, the cockpit of Europe.

The growth of nationalism was a great disaster in many ways. We have exported not only many of the good things, we have exported war. After the last Great War there was a great vacuum of power in Europe; a great gap to be filled. It could not be left empty, and an attempt was made to fill that gap by creating the appropriate organisation or organisations to fill it. One of those organisations is the European Economic Community. The question before us, and the question before the nation, is really this, is it not: dare we stand out from playing our part in the construction and working of that new mechanism, which is so absolutely necessary? I am sure that, put in that way, the answer is quite obvious.

The third point I want to touch on—it is my final point—is the question of sovereignty. Here I invite correction from the noble and learned Lord who sits on the Woolsack. I do not always invite correction from that source, but on this occasion I do. I think that a great deal of unnecessary mystery is made of this question of sovereignty. I do not believe that there is any authoritative legal definition of what sovereignty is, but I think we all know what it is. A State is recognised to be a sovereign State when it is capable of conducting government internally and capable also of conducting relationships on behalf of its people with other sovereign States.

An analogy may be helpful. Sovereignty is to a nation what personality is to an individual. He can take a general pattern and view of life. He can take the view that he will choose by himself, do his own thinking. He will not restrict the exercise of his personality in the interests of other people. If he does that, of course, he would never enter into partnership with anybody. That would be folly. He should not commit the ultimate folly of getting married. Both those relationships involve restriction on the use of his own personality and on the exercise of it. But both relationships are entered into constantly, because everybody knows that in fact they enlarge the individual's scope of action, they enlarge his personality and his general power over life. That, I think, is what sovereignty does for a nation. It is not something to be hidden in the earth, but something to be used, something to be exercised. If we go into this Treaty of Rome, it will certainly be an act of sovereignty. It will take effect by virtue of an Act of Parliament. As the noble Lord, Lord Annan, said earlier, an Act of Parliament can be repealed by a subsequent Parliament, though I think that it would be an act of wickedness to go into this arrangement with any such get-out in mind. The Treaty itself contains ample provision for ensuring that national interests are not going to be over-ridden by Community organisations.

I summarise my three points in this way. First of all, we must take advantage of this vast market which will be open to us. Secondly, we must take part in the organisation of the necessary machinery which is to take the place of the vacuum created in Europe. Thirdly, we need have no worry that we are going to lose our sovereignty in the process. We ought to do it. We can do it. Let us do it.

10.40 p.m.

THE MARQUESS OF LOTHIAN

My Lords, we have come to the end of the first day of what I feel sure most noble Lords may well consider to be the most important debate that your Lordships have held for a great many years. I think the House will entirely agree that we have had many notable and thoughtful speeches today; and I should like to echo the tributes that have been paid, particularly to the two maiden speakers, my noble friend Lord McFadzean and the noble Lord, Lord Burgh, who, in very different types of speeches, I think your Lordships will agree contributed remarkably to the discussion that we have been having since 3 o'clock this afternoon. Of course, there have been a great many other speeches today—another 33—and I think it would be invidious if I were to pick out one from the other. But the fact that there have been so many is indicative, I think, of the very deep feeling which Members of your Lordships' House have on this, to my mind, most important topic. My rough tally at the end of the first day, my Lords, is that, of the speakers, 28 have been in favour, three have been against and one has been a little uncertain. It will be interesting to see what the score is tomorrow evening.

Now I do not want to be too long this evening, and I shall try to answer some of the points that your Lordships have raised today, but the House will realise, of course, that my noble friends who will be following me at this Box in the next two days will also be dealing with some of the points which I shall not have the time to cover tonight. In particular, I think I might inform your Lordships that my noble friend Lord Jellicoe, the Leader of the House, will be dealing with the financial matters concerning the Community and our contributions, capital movements, et cetera, and my noble friend Lady Tweedsmuir will be dealing with regional policies and the Common Agricultural Policy, and with matters affecting the housewife. I should like, if I may, to concentrate briefly on one or two matters concerning the Commonwealth, because various noble Lords have asked me questions about this, or have made comments about it, and I should like to take up a little of your Lordships' time in dealing with it.

I think it is common knowledge that many of the negotiations have been concerned with questions affecting different members of the Commonwealth, and I think it right, in a few minutes, to say a little more about the two matters which have aroused the greatest potential difficulty in the negotiations; that is to say, New Zealand and the question of sugar. But, my Lords, it should not be forgotten that we have also been able to achieve satisfactory arrangements of various kinds for an enormous number of other Commonwealth countries. The facts with regard to this are, of course, set out in the White Paper, and I think I need only remind your Lordships of the main outline. For instance, the offer of one of two kinds of association agreement or of a simpler trading agreement for which 20—no less—Commonwealth countries will be eligible. These countries will have until January 31, 1975, to make up their minds, which I hope the House will agree is a considerable period of time and which I trust will be sufficient. Until then, my Lords, present trading arrangements between us and these countries can be maintained.

Again, all British dependent territories, with the exception of Gibraltar and Hong Kong, for which special arrangements have been made, will be offered association under Part IV of the Treaty of Rome. What this means—and I think it is right that we should recognise it—is that the Commonwealth as a whole can—

LORD SHEPHERD

My Lords, the noble Marquess mentioned special arrangements for Hong Kong. Can he say what they are?

THE MARQUESS OF LOTHIAN

Yes, my Lords; the arrangements for Hong Kong will mean that Hong Kong is included within the generalised preference system of the Community, with certain exceptions.

What I think is true to say is that the Commonwealth as a whole can, we believe, expect to gain rather than lose from British entry; because even without us the Six has proved to be over the past few years an enormous force of attraction in world trade. For example, a number of Commonwealth countries—I need only mention Kenya, Tanzania, Uganda. Cyprus and Malta—have already moved towards some sort of commercial association. If Britain stayed out of the Community, there would almost certainly be a growing conflict between the different countries' needs for increased trade with the Six, on the one hand, and with Britain, on the other. With Britain in the Community, this conflict need not arise.

In the case of the developing countries, there is every prospect of trade with the enlarged Community increasing. Moreover, all the countries of the Commonwealth, I believe, stand to gain from this country's growing prosperity and influence—which we shall achieve only if we seize the opportunity offered by membership of the Community. Only then will it really be possible for the countries of the Commonwealth to continue looking to this country for first class educational and training facilities. This is the point touched on by the noble Lord, Lord Orr-Ewing. It is ties of this kind, quite as much as, if not more than, trade patterns which are increasingly bound to change which will, I believe, bind the Commonwealth more securely together. Surely a Britain which is excluded from the centre of affairs in Europe, on the edge of a flourishing Continent would not be able for long to continue to help the countries of the Commonwealth in the way that we have in the past.

My Lords, a word about New Zealand. This is a subject which has been raised quite frequently this afternoon. It is a matter of satisfaction that the New Zealand Government have publicly made clear their belief that not only are the terms the best we could have achieved but also a good deal better than it looked as if we were going to get a fairly short time before. This is the consensus of informed opinion in New Zealand and among many observers and experts who have been following every move carefully in these negotiations. Moreover, New Zealand Ministers have generously paid tribute to the support for the interests of their country which our Parliament, the British Press and the British people have shown. I think it is a matter of satisfaction that the New Zealand Government have been able to feel that we have done our best for them.

On sugar, the agreement reached on sugar imports from the developing Commonwealth sugar countries is set out in the White Paper; and here we find the text of the statement issued after consultations with the sugar-producing countries in London on June 2 and 3, which shows that, like the British Government, the other Commonwealth Governments concerned regard the Community offer as a firm assurance of a secure and continuing market in the enlarged Community on fair terms for the quantities of sugar covered by the Commonwealth Sugar Agreement. I think that this is the answer to any criticism that has been made. I am not suggesting that there has been any criticism made this afternoon in this House but we have heard of it from elsewhere. It is the same in the case of New Zealand. I think we must agree that it would be perhaps out of place now for people in this country to say that they know what is good for the sovereign and independent Commonwealth countries concerned better than the Governments of those countries themselves.

My Lords, as I have already made clear, in dealing with other Commonwealth issues, this political guarantee on sugar was accompanied by an offer from a choice of forms of association or a trading agreement for the developing Commonwealth sugar producers. This means that if the Commonwealth countries concerned choose to take one of the options open to them they will have special links with the enlarged Community. I think it will be agreed that the Community has an excellent record of looking after its own, and we see no reason why an enlarged Community should not equally maintain policies helpful to the developing world in general and its associates in particular. Perhaps I might now turn for a brief moment to fish. I think the noble Lord, Lord Boothby—

LORD SHEPHERD

My Lords, I put a specific point to the noble Marquess. Can he give an assurance that there will be adequate refining facilities for cane sugar in the near future?

THE MARQUESS OF LOTHIAN

My Lords, I can tell the noble Lord that the refining interests have expressed satisfaction with the situation and the position reached in the negotiations. I hope that the noble Lord, Lord Shepherd, will feel that that is satisfactory, because I think they themselves must know what they want and what they will have.

Perhaps I may now say a word or two about fish, because I know that this is something which is worrying noble Lords, and indeed any Scotsman must worry about it perhaps more than others. Perhaps I may just put the situation as it is at the moment, because I think it right that this should be made clear at this stage. No agreement has yet been reached, but, as the White Paper makes clear. the Government are determined to secure arrangements which will be fair throughout the enlarged Community and will satisfactorily safeguard the interests of British fishermen ". That is a firm commitment. What happened during the negotiations was this. We proposed a six-mile limit measured from the usual base lines as a fair and reasonable solution for the whole of the enlarged Community. Within that limit fishing would be reserved for vessels genuinely belonging to the ports from which those waters are now being fished. This proposal is based on the principles of the European Fishing Convention 1964, to which the noble Lord, Lord Boothby, made reference, which was adopted both by us and by the Six, by Denmark and the Irish Republic for their Atlantic and North Sea coasts. It specifically envisaged, first, a special régime for the members of the Community. This proposal remains on the table and we regard it as a reasonable basis for a permanent régime which would be equitable for all parties.

At the Ministerial meeting on June 21 and 22, the Community recognised that the access provisions of the Common Fisheries Policy would need reconsideration and further negotiation, so discussion was taken up again at the following Ministerial meeting on July 12 and 13, which was the last Ministerial meeting held so far. Not all the applicant countries were present at that meeting and it was therefore not possible to seek to reconcile their different approaches to the problem, and it became clear that more time was needed. We therefore proposed that there should be an interim agreement to maintain the status quo unless a permanent agreement could be reached in time to be embodied in the Treaty of Accession. Under the interim agreement, the applicant countries would be able to retain their existing regimes until a final agreement could be reached after enlargement. This would avoid the difficulty for applicant countries of coming to individual agreements without knowing the régime for the enlarged Community as a whole.

The Six took note of this proposal and are now studying it in greater depth. It is hoped that it will be—in fact it will be—taken up again in the autumn. The Government feel convinced that to get a worth while and satisfactory solution it is important to have the time to do so. But I should like to assure noble Lords who are anxious about this that the Government are very much seized of the problems and anxieties of the fishermen in this regard; and, as I say, they are determined to find a solution which will be satisfactory to them.

My Lords, I have been asked one or two question which I might deal with quite briefly. The noble Lord, Lord Teynham, I think it was, raised the question of the free movement of labour and the matter of the Immigration Bill. I am not certain whether the noble Lord was here the other night when the Committee was discussing this point about Commonwealth immigration as opposed to E.E.C. imigration, but the Government are considering the matter carefully, and it is something which will be brought up again during the Report stage of the Immigration Bill in the autumn. The noble Lord also mentioned the question of food prices, but I think I will let my noble friend Lady Tweedsmuir of Belhelvie tackle that subject to-morrow—she knows how these things affect the housewives.

I am sorry that the noble Lord, Lord Wynne-Jones, poured such cold water on the whole conception of the E.E.C. He mentioned the fact of the growth of EFTA being greater than that of E.E.C. countries—and this was a point, I think, which my noble friend Lord Selkirk confirmed. I think the reason for this is that some of the small EFTA countries, like Denmark, when suddenly presented with a much larger market at the conclusion of the EFTA Agreement, naturally took advantage of it. In the same way, this is something that we in this country would hope to benefit from when we accede to the Community.

I have taken up much of your Lordships' time, and perhaps I can finally deal with one or two general implications of British entry into the Community. First, I think this point needs emphasising. There is no question, my Lords, of membership meaning that our connections with the Commonwealth, and indeed our long-standing interest in countries all over the world—our ties, connections and common language with countries overseas whose stock originally came from these Islands—are forgotten, and that this country can become a country whose horizons are confined to Europe. This is not true of existing members of the Community, such as France, who has considerable overseas connections. Nor is it true. I think, of the Community as a whole. It is one of the world's largest trading communities, involved in negotiations and discussions with most countries on the globe. I believe, on the contrary, that Britain in Europe will be better able to exercise its influence on the problems of the Western World and the world in general, and will be better able to forward our interests, and indeed European interests, more effectively than we could possibly hope to do on our own.

The time was when it was sometimes suggested on the Continent of Europe that our overseas ties were a liability in relation to British entry. I believe that that time has gone, and that it is generally recognised that our wide experience and the long-standing connections that we have had with our former Colonies, now powerful independent States, will be of real value in an enlarged Community moving towards a common European view on foreign affairs.

My Lords, as I have said, this cannot but benefit the Commonwealth also in many ways. I believe that the members of the Commonwealth are increasingly coming to recognise this, and I trust that the people of our own country will increasingly do so. As has been said in the debate, history and geography, questions of security and plain economics, have always tied us to the Continent of Europe. Noble Lords have pointed out that much British and Commonwealth blood has been spilt to preserve Europe and its civilisation from tyranny. Even in Europe's most fragmented periods our policy has to a great extent been European in outlook. Noble Lords have referred to the Romans, and it is quite true that since their time in our history our fortunes have always been bound up to a greater or lesser degree with Europe. The Romans saw the Continent of Europe, its greatness and its power, as a single entity, a unit, but of course dominated and pacified by one single individual or country.

We have had other examples throughout history of the same thing; we have only to think of Napoleon and, more recently, of Hitler. The price of unity on these terms—dictatorship, the sword, suppression of liberty—was too high. I think it is to the great credit of this country that we always realised that, and despite what the noble Lord, Lord Soper, felt, our attempt to achieve peace by preserving the balance of power did succeed in many instances. But, my Lords, there was never any unity. What has happened now in the past twenty years is that the countries of Western Europe have voluntarily come together in a single act of faith and will to create a real organic and European unity. It is becoming a great success. One has only to study the figures of growth of which noble Lords have given examples. My own view is it was a tragedy that our country did not go in at the start. It is not too late but, as noble Lords have said, this may be the last chance.

We have now at last the prospect of real unity and real security, of ending the bloodshed and the quarrelling, of rebuilding our prosperity and our dignity, and of taking our place in a Europe of equal nations, each with our own character, our own individual contribution, sharing the same ideals and working together for the common cause of human advancement and culture, and recreating the best in our civilisation.

This country has faced momentous decisions before, but this may be the most momentous of them all. It is certainly the most important, particularly, as noble Lords pointed out, in terms of our children's and our grandchildren's future happiness. I believe, and the Government believe, that we should be right to enter on the terms that have been agreed. I hope that when the time comes the House and the country will endorse this view.

THE LORD CHANCELLOR (LORD HAILSHAM OF ST. MARYLEBONE)

My Lords, I beg to move that the debate be now adjourned until tomorrow.

Moved, That the debate be now adjourned until tomorrow—(The Lord Chancellor.)

On Question, Motion agreed to, and debate adjourned accordingly.