EUROPEAN COMMUNITIES BILL

HL Deb 25 July 1972 vol 333 cc1223-346

2.50 p.m.

THE LORD CHANCELLOR (LORD HAILSHAM OF SAINT MARYLEBONE)

My Lords, I rise on behalf of my noble friend Lord Jellicoe to move the Second Reading of this Bill. May I begin by seeking to explain the role that I shall endeavour to play, leaving some of the details and special parts of the Bill—as I shall have to do—to further treatment by my noble friends who will follow after me at different stages of the debate? I shall endeavour to be expository, if I may put it in that way, rather than contentious, and to make my submissions to the House in support of the Second Reading by explaining the provisions of the Bill, rather than by criticising those who have attacked them. In this way, I hope to give offence to no-one on either side of the House, whether they agree with the conclusions that I shall venture to put before the House or whether they do not. Of course there are in your Lordships' House noble Lords who have opposed entry to the Communities from the first. May I say, at the outset, that I fully acknowledge and respect their position. All I ask in return is that they should also respect and acknowledge ours.

Our position is this. Entry into the Communities has been more or less under discussion since 1950, when the Coal and Steel Community began to be formed. Indeed, in the debates last year I reminded the House of the part that I played in the House of Commons on that occasion. The question of entry has been under intensive discussion ever since 1961 when the Macmillan Government, which had previously been adverse, decided to apply for membership. It was the subject of a vote in the House of Commons in May, 1967, when the Wilson Government decided to press a new application, and the implications of entry were then set forth in a Government White Paper reproducing the then Prime Minister's statement. The White Paper of 1967 was the subject of a Resolution in your Lordships' House, in which your Lordships approved without division the policy of that White Paper on May 8, 1967. It has been a more or less continuous issue in by-elections and general elections over a period of years. In my own by-election in 1963, for instance, there was an express anti-Common Market candidate, and at all three General Elections at which I stood as candidate for St. Marylebone I was questioned about it, both in my own constituency and in other parts of the country. During the present sequence of negotiations, Mr. Rippon made numerous statements in Parliament, and after the negotiations both Houses debated the matter at length with the Whips off on the Government side; the first time without commitment, and the second time approving in principle entry on the basis of the arrangements that had been made, in this House by a majority of about eight to one in an extremely well-attended Division.

My Lords, as I said, I fully respect the position of the dedicated opponents of entry into the Communities. But I sin cerely submit that they should also acknowledge ours. Ours is that last year Parliament, after exhaustive public and private discussion, committed the honour of this country to entry on the terms negotiated. On that basis we concluded the Treaty of Accession. This Bill is designed to put us in a position to give effect to that Treaty of Accession. What I seek to persuade the House to-day is that the Bill is not merely the best, but in truth the only practicable, and at least the only acceptable, way of achieving that purpose.

I am not going to talk in detail about its draftsmanship, which is largely a technical matter and not suitable for a Second Reading speech, but 1 think I ought to dwell for a moment upon the drafting policy underlying it; that is to say, why the Bill takes its present shape rather than any other shape. When we set upon the task of giving instructions for the drafting of this Bill we had much advice from many quarters: from our own Back-Benchers, from one another, and even from critics of entry. There emerged, roughly speaking, three principal schools of thought. One was what I will venture to christen the theory of the one clause Bill. This Bill would then simply have been an enabling Bill giving the Government power by Statutory Instrument to do all that was necessary to effect entry in accordance with the negotiated terms. This would have been technically possible for us. But in our view it would have been constitutionally unacceptable, and so we rejected it.

There are a number of features where it is perfectly possible to legislate with precision in the traditional manner, and in our view where we can identify such a field we are constitutionally bound to adopt this method in preference to any other. Some, of course, like the Value Added Tax, will be contained in separate legislation, and are therefore not included in this Bill; some, like the question of fishing limits, can be handled under existing legislation and are therefore not included in the Bill. But such others as we can identify—and all these other subjects which can be dealt with by legislation—which must be effected before entry are reflected in detail and separately in Part II of the Bill before the House. They include matters where the terms of the Treaty demand the creation of new insti- tutions of a specific and identifiable kind such as the Agricultural Produce Intervention Board, which is created by Clause 6: they include cases where the Statute law needs to be repealed or to be amended in an identifiable and specific way. These cases are catered for by Clause 4 and by the Schedules 3 and 4, or, in the case of customs duties, Clause 5. Clause 7 deals with the law relating to sugar; Clause 8 the Films Acts 1960 to 1970; Clause 9, companies law; Clause 10, restrictive trade practices; Clause 11, criminal law; and Clause 12 the confidentiality of information. All these are important matters, and, in the judgment of the Government, were more appropriate for legislation by Bill than by Statutory Instrument or Order in Council.

Naturally enough, the exact borderline must be a matter of practical judgment. Some of the clauses I have mentioned give an additional regulatory power ancillary to the provisions of the clause. Of course in some circumstances subordinate legislation may be appropriate, in accordance with our contemporary practice of subordinate legislation subject always to Parliamentary control. All I ask the House to accept is that in rejecting, as I have said, the "one-clause Bill" school of thought, the Government have acted wholly in good faith in including in Part II all the detailed statutory provisions needed on account of the obligations of membership which will apply to us on entry or shortly after entry. I may fairly add that though the Bill has been, unlike some others, exhaustively discussed at an earlier stage of its progress, no omissions have so far been brought to our attention.

My Lords, one school of thought, then, was the one-clause Bill. The second school of thought—not, I am bound to say, very seriously considered by us; but canvassed in public—was what I might call the 1,000-clause Bill. I call it that despite the circumstance that the figure of 1,000 clauses had, so far as I know, no foundation or justification in any real world. But it seems none the less that this theory reflected the opinions of those who held that no amendment of the law, however trivial it might be, should be effected in a measure of this importance otherwise than by Act of Parliament. I suspect, though of course I do not know, that it also reflected an exaggerated idea of the extent to which changes in the law are entailed by the present state of Community obligations.

Perhaps it is significant that this view was warmly embraced by the opponents of accession, since it would clearly have been impossible within the time available to give effect by this means to our honourable commitment to accede. But quite apart from the fact that it was manifestly inconsistent with our honourable obligations, there were, I conceive, two conclusive arguments against its adoption. The first was that it was technically impossible. It is of course conceivable that the 1,000-clause theory, as I have described it, stemmed from a belief that it would be necessary to reenact in full all the provisions of directly applicable Community Law. This is not so, as I shall be pointing out in a minute or two at a later stage of my speech. But quite apart from this it is simply not possible to identify at this moment of time every conceivable change that would or might have to be made in the future to British Common or Statute Law—the second of which is much more detailed and the first of which is far less precise than any Continental code of which I am aware—in order to comply with our obligations. But, my Lords, as will appear when I come to the details of Part I of the Bill, it would be impossible by this means alone to give effect to our Treaty obligation to cater for those areas of Community Law which are of direct application in our courts.

The second objection to the 1,000-clause theory is that such a plan would be wholly contrary to the legislative policy of the last 70 years, which in every field has increasingly made use of the enabling Act and of subordinate legislation to cover the immense field of activity for which Parliament has become responsible. To revert to the practice of the seventeenth and eighteenth centuries in this solitary case, important, as it is, is as unacceptable constitutionally, in my view, as it would have been under the one-clause theory to revert to the practice of legislating by decree.

So, my Lords, like the last Government in their 1967 White Paper, we accepted the third school of thought. We concluded that the Bill must contain (and here I am quoting from the 1967 White Paper) provision for,

delegated legislation issued under Parliamentary authority which could cover future as well as present Community instruments". My Lords, the result is that the Bill represents, in my submission, a reasonable balance, designed in the tradition of contemporary constitutional theory, and in our opinion it does all that is necessary to give effect to the decisions arrived at by the House, on the advice of the Government of the day, as long ago as 1967. Part II is thus a compliance with our traditional preference for direct enactment as interpreted by the constitutional practice of the last 70 years.

I come now to the content and philosophy of Part I. As I indicated a moment ago, the Treaty of Rome provides what the Luxembourg Court calls a new legal order but what I myself, following a most illuminating lecture on the subject by Professor Kahn Freund, prefer to call a new source of national or, as lawyers call it, "municipal" law in the countries adhering to the Treaty. This new source of law, directly applicable in the national courts, consists in the fact that parts of the Treaty itself and, by the terms of the Treaty, most and perhaps all of the regulations of the Council of Ministers and the European Commission, are of direct application in the courts of the member countries, in rather, though of course not exactly, the same kind of way that certain rules of International Law are in fact applied directly either by the ordinary courts of this country or, in time of war, by a Prize Court. This has always been known to be the case; it is inherent in the nature of a Common Market and can be shown to be inherently postulated by any form of Common Market as distinct from a purely free trade association; and it has been repeatedly explained by Ministers and lawyers.

It is a novel conception, but it is an inescapable condition of membership. It is inherent in the conception of the Community, and it was before the consultative body of distinguished lawyers which I mentioned in my speech last year as having been consulted by my predecessor in 1962. It was foreshadowed explicitly in the White Paper of 1967; and in my submission the only question regarding it is whether we have achieved the best practicable piece of draftmanship in incorporating the obligation in the provisions, particularly of Part I of the Bill.

My submission, put to the House without doubt, is that we have succeeded, and again I can quote the previous Administration in support of our conclusion. On May 8, 1967, in the debate here, my predecessor, the noble and learned Lord, Lord Gardiner, said that their Bill: would include an enactment applying as law in the United Kingdom so much of the provisions of the Treaties and of the instruments made under them as then had direct internal effect as law within the Member States and providing that future instruments similarly took effect as law here."—[OFFICIAL REPORT, 8/5/67, col. 1202.] My Lords, this is what we have achieved by Clause 2(1). The point, both as regards present and future instruments, was also made explicitly in the White Paper of 1967.

It is of course an inherent part of the new system that although the courts of this country will interpret Community law and apply it, the final authority for interpreting it is the Court of Luxembourg itself, on which I feel confident there will be, when we have acceded, a British judge and a British advocate-general. In accordance with the system, all courts in this country will have the right, and the ultimate courts of appeal will have the duty, to refer to the Luxembourg Court questions of Community law of doubtful interpretation. It is clearly desirable that the provisions of Community Law which are directly applicable, and what is and what is not an ancillary Treaty under Clause 1 of the Bill, should be ascertained and identified in advance, so that they can be known in advance. That is the purpose of Clause 1 of the Bill, of Clause 2, of Clause 3, and of the definitions in Schedule 1. We should, of course, have liked to provide means of identification even more precise than that provided by Clause 1(3) and Schedule 1(7), and we have done so in relation to future Treaties by means of the provisions of Clause 1(3), and very largely and so far as practicable by the same subsection to existing Treaties.

My Lords, the question of what is and what is not of direct application, or of what is and what is not an ancillary treaty, is ultimately a question of law to be decided in individual cases by the courts of this country, subject to the ultimate jurisdiction of the Luxembourg Court itself. As in all other areas of new law with which I am familiar, there will be questions to be decided by the courts as we go along.

There now comes a constitutional point about which I feel I ought to say a word. There is of course a potential conflict in every member country between the municipal and constitutional law of that country and the new source of law provided by the Treaty and regulations. In most of the existing members—and I think that they all have written Constitutions—the area of conflict can arise where a regulation or where the Treaty conflicts, or appears to conflict, either with the terms of a Written Constitution or with one of the functions of a national institution, be it Parliament or the courts, whose rights and jurisdiction are laid down by the Written Constitution. This conflict exists and has been discussed, in France with the Conseil d'Etat, in Germany at Frankfurt and, I believe, also in Italy. If it arises here—and I think it is doubtful whether it will arise—it will arise not because of conflict with our Written Constitution, because we have not a Written Constitution, but in relation to the doctrine which we do possess and which to some extent takes the place of a Written Constitution—and I referred to it earlier in Parliament when the noble Earl, Lord Arran, was introducing his Bill of Rights —the doctrine of the sovereignty of Parliament and its corollary (I believe judge-made) the doctrine of the priority of later Acts over previous Acts: that rule of construction whereby when two Acts conflict the later is construed as amending or repealing the earlier one.

It is to meet this difficulty that Clause 2(4) has been inserted as an express provision in the Bill in so far as it provides that obligations arising under Clause 2(1) (Community obligations) have precedence over subsequent enactments. This therefore provides a new rule of construction of Statutes to substitute in the appropriate case, but only in the appropriate case, for the judge-made rule to which I have referred. It is not inconsistent with the sovereignty of Parliament. It is, as the noble and learned Lord, Lord Gardiner, pointed out in 1967, an application of the doctrine of the sovereignty of Parliament, and I think I can take a certain modest pride in the fact that when, in Opposition and before the Crowther Commission was set up, I was advocating a Bill of Rights, I made a somewhat similar proposal for a new law of construction to the one now in Clause 2(4) in relation to the rights created by such a Bill.

My Lords, I come now to the important provisions for subordinate legislation contained in Clause 2(2) of the Bill. These powers are designed to give effect to those provisions of Community law which are not of direct application in our courts but which require some specific action to change our law, action either on the part of Parliament or on the part of Her Majesty's Government. In view of the specific provision made within Part II and elsewhere for the present corpus of Community obligations, this provision is largely to meet a future need. It will also be used to supplement directly applicable provisions; for instance, to sweep up any inconsistencies between our positive law and Community law as they may emerge from time to time. Since, for this purpose, it may be necessary to amend Statutes, there is provision in the first part of Clause 2(4) to enable powers under Clause 2(2) to be used for this purpose.

The ambit of the powers of delegated legislation conferred under Part I is delimited by subsections (a) and (b) of Clause 2(2) which relate them to Community obligations and rights under the Treaties and therefore to the purposes of the Treaties—which are to create economic Communities and not, for instance, to give an extreme example, a defence agreement. Since, however, these obligations may call for subordinate legislation on a range of miscellaneous subjects, it is inevitable that the powers should be expressed in general terms. This is why we thought it necessary to restrict the powers by the provisions of Schedule 2. These restrictive provisions are too detailed to be gone through individually in a Second Reading speech, but in general they prohibit Ministers from legislating to increase taxation, from legislating retrospectively, from legislating in order to delegate their own powers or from legislating to extend the field of criminal law by the creation of important new criminal offences. If any of these restrictive purposes have to be achieved this will have to be done by a specific Act of Parliament. The subordinate legislation itself will be subject to the Parliamentary control prescribed by Schedule 2, paragraph 2, and may, according to the circumstances, be either in the negative or the affirmative form.

I think I have now mentioned, and I hope that I have by now explained, every clause in the Bill and all the Schedules in a form sufficient for an opening speech on a Second Reading debate. I do not think that a longer effort is needed from me at this time. I have deliberately not reopened the question of the desirability of entry, nor have I attempted to traverse the political ground which will be covered by my noble friend Lady Tweedsmuir of Belhelvie and my noble friend Lord Jellicoe. I hope that my noble friend Lord Colville of Culross will be answering any legal points which may have emerged after my speech at the instance of any noble Lords who wish to press for further details. As I say, I respect the position of those who are against accession and I ask only that they should respect the position of those—and I believe them to be the great majority in this House—who are for it.

I have endeavoured to show why the Bill takes the form it does take, what the provisions of the Bill involve and, so far as it is possible at this stage, why they have been inserted and what they seek to effect. For the sake of completeness, I must point out again that there are certain things not in the Bill which would have been in it if existing legislation did not already give us the powers to act as necessary. I will not attempt to enumerate all these. The Bill is a working piece of legislation, and neither a manifesto nor a White Paper. There are also things about which we shall no doubt need to legislate later. If they require separate legislation, Parliament will be asked to provide it at the appropriate time.

My Lords, having therefore endeavoured to expound with such lucidity as I can command the principles of what is a complicated piece of legal draftsmanship. I should like to conclude with one personal expression of opinion. Obviously, the Community and its institutions are still evolving. They are not static; they are dynamic. What they will become from January next remains, of course, hidden in the future. But from January next we in Parliament, as well as the other members, new and old, shall be participating in shaping the destiny of the Community. There is nothing in this Bill, I believe, which derogates from British pride, from British traditions, from British honour or, in any sense in which I have been able to define the word, from British sovereignty, legal or political—if sovereignty means, as I think it means, the right (to use a paradoxical phrase), or at least the power, to do anything right or wrong, or at least things which other people consider to be right or wrong.

But this Bill, or rather the accession which the Bill, when an Act, will render possible, commits us in honour to be faithful partners in an association which is intended to endure—and which I pray may in fact endure and prosper; an association which, if it be successful, will enable Europe and her kindred peoples to play, in peace with one another and with the nations of other Continents, the part which her history, her genius and her national wealth entitle her to assume in the endless adventure of humanity evolving here on earth. My Lords, I beg to move.

Moved, That the Bill be now read 2^a.—(The Lord Chancellor.)

3.20 p.m.

LORD GREENWOOD OF ROSSENDALE

My Lords, I begin by congratulating the noble and learned Lord on the success he achieved in making an expository speech. With less sincerity, I pay a warm tribute to Her Majesty's Ministers on achieving something which, so far as I know, has eluded every previous Administration. The noble and learned Lord who sits on the Woolsack referred to the drafting policy behind the Bill. It is that, my Lords, which appears to have produced a perfect Bill; a Bill so immaculate that two million words of debate in another place have failed to reveal the smallest chink, the least weakness, the slightest infelicity in the work of the Parliamentary draftsmen who prepared it. It is, of course, true that the Bill scraped through the Second Reading in another place by only a derisory eight votes, and that at other stages the Government's majority fell as low as four. But the Bill comes to your Lordships' House as pure as the day on which it was born.

The noble and learned Lord said that no omissions have been brought to the Government's notice. Your Lordships will recall that in the case of the Industrial Relations Act we in this noble House made over 300 Amendments; and that in the case of the Housing Finance Bill we made about 160. In both cases, moreover, many of the Amendments were tabled by the Government. But during the Committee stage in another place of this much more basic and far-reaching measure, not a single Amendment was tabled by the Government or accepted by their spokesmen. That, my Lords, is a rare achievement and the Bill must owe a lot not only to the skill of the lawyers who prepared it, but also, as the noble and learned Lord would have us believe, to the almost superhuman wisdom and sense of fair play of Her Majesty's Ministers.

It is true that history may regard their achievement as a piece of political chicanery. It is true that old hands like Mayor Daley may look with envy upon the Government's unobtrusive skill in behind-the-scenes Party management. It is true that our own people may be surprised to find how little influence strong public opinion really has on the processes of British democracy. It is true, too, that our children and grandchildren may think that the terms of the agreement are the most improvident since Esau sold his birthright for a mess of pottage. But, my Lords, the Government must have their hour of glory. They have produced a Bill incapable of improvement.

The noble and learned Lord has referred to our debates in October. Since October, when we approved entry in principle, a great deal has happened both in the Community and outside. The Community itself is just the tiniest little bit battered. President Pompidou can hardly have been wholly satisfied by the lack of confidence that the people of France showed in him when he held his referendum. Chancellor Brandt, I am deeply sorry to say, has seen his position weakened because of his wise and commendable Ostpolitik. The Dutch Government has run into trouble. Italy has embarked upon its 36th—or is it its 37th?—Government since the end of the war. And there have been the usual wrangles between the Six. It is not surprising, although I hope that I would have phrased it more elegantly, that the Spectator on June 17 should have I said: With each day that passes, the European Economic Community looks a more ramshackle and clapped-out organisation, a bureaucratic paradise and a political hell. Over the same period, our own attractiveness as a partner must have waned. Public opinion polls have shown little liking, for the Community. The economic situation at home has deteriorated. There is industrial chaos throughout the land. Inflation and rising prices have gained momentum. One can see the situation in a nutshell on the first and last pages of Saturday's Financial Times. There your Lordships will find the following headings: "Retail price rise accelerates"; "Barclays and Midland rates up"; "London brick prices up by an average 7½per cent."; "I.C.I. nylon yarn dearer"; "Scrap metal rise"; "Markets fall sharply …"; "Double Diamond going up."

It was surely no coincidence that on the same day, Saturday, The Times should have had a leading article headed "The Crisis of Mr. Heath." After two years' experience of the present Government, we were told by The Times that …there has seldom been a worse July than this has been for Mr. Heath in Government. It brushed aside most of Mr. Heath's colleagues. I am sorry that the noble Lord, Lord Carrington, has just left the Chamber, because The Times paused briefly to describe the noble Lord as "probably the best discovery of this Government" but went on to say: …the Conservative Party needs as well as strength an imaginative understanding of society which he would not claim to be able to provide. Finally, my Lords, it said: there are the grand old men of Conservative politics, Lord Hailsham and Sir Alec Douglas-Home, who have been at the centre of the stage in the past but are not expected to return to it now. That, my Lords, is the Government which claim to be greeting the unseen with a cheer!

In accordance with our normal practice, my Lords, we on this side of the House shall not vote against the Second Reading to-morrow, and I shall not discuss the principle of entry this afternoon. Instead I shall confine myself to some of the terms upon which the Government are prepared to enter; terms which I believe to be damaging to your Lordships' House, to the interests of our country and to our partnership with our friends in the Commonwealth. First, my Lords, it is hard to believe that the 303 Members in another place—fewer than half of the total number—who gave the Bill a Third Reading realised to what extent they were writing Finis to centuries of Parliamentary sovereignty. Whatever the noble and learned Lord the Lord Chancellor says, the Bill we are discussing virtually puts an end to the constitutional concept of the Queen in Parliament. I have no objection in principle to some surrender of national sovereignty in the interest of a supra-national body, but I should prefer it to be a body with a greater promise of stability than I believe the E.E.C. possesses. I believe it to be essential that Parliament should retain some supervision over the legislation emanating from Ministers, and even from officials, in Brussels and not susceptible to Parliamentary amendment here in Westminster. We must reduce that area of conflict to which the Lord Chancellor so rightly referred.

The noble and learned Lord, the Lord Chancellor, characteristically, made the whole matter sound so reasonable when he drew your Lordships' attention to Clause 2. If your Lordships decide to approve Clause 2(1) you will be approving virtually the whole of 42 volumes of Community law which Brussels has so far enacted. I doubt whether any noble Lord in this House has studied them all, yet every citizen in the United Kingdom will be expected to know what they say. Mr. Peter Shore put the case well when he said that the power to make the laws of England is being deliberately transferred by the Bill to an authority outside our own land, and answerable to no one inside it.

It was the barons, my Lords, who forced Magna Carta on a relucant monarch, and I cannot believe that your Lordships will let this Bill go through Committee without ensuring that we retain at least some control over the making of laws more satisfactory than the mere retrospective censure of a British Minister—one of ten sitting in Brussels—for having failed, or for not having tried to get something better for our people. It is, I think, a matter for comment that the competence of Brussels has been extended since the White Paper of 1967 to which the noble and learned Lord referred a number of times. It has been extended even to the imposition of taxes upon our people, a right jealously guarded by the Commons throughout history.

Nor are we satisfied that we have effectively protected our friends in the Commonwealth from the impact of our joining the Economic Community. Her Majesty's Government have not met the Labour Party's reiterated demand, first made by Hugh Gaitskell in a remarkable speech to the Labour Party Conference in 1962 that the terms of entry should not be allowed to weaken the Commonwealth. That demand was summed up in the Party's Manifesto at the last Election when we said that. British, and essential Commonwealth interests must be safeguarded. The safeguards have not been obtained. For 40 years the sterling area enabled us to make a major contribution to international trade and, as the Financial Times has reminded us, to keep the Commonwealth together. But the floating of the pound and the effective ending of the sterling area have already caused great damage, damage no doubt necessitated, but not in my view justified by the Community's obsession with economic and monetary integration. Few of your Lordships can have reacted with enthusiasm to President Pompidou's arrogant diktat that unless the pound is fixed we may be refused entry to the Community.

The damaging effects on the Commonwealth are too numerous for me to spell them out on this occasion, but we shall do so at the Committee stage. I am saddened, however, to think that it is possible for the Deputy Prime Minister of Australia to say in London on June 28 that from early next year the great Commonwealth of Australia—to whom we owe so much and with whom our ties have always been so close and so warm— "will be relegated to the position of residual supplier" by the mechanisms of the Common Agricultural Policy. I am saddened, too, to find Mr. Dowling, President of the British Trade Association in New Zealand, claiming—rightly in my view—that the terms of the Brussels "deal" in which Her Majesty's Government have taken such inordinate pride, do not represent an adequate safeguard for New Zealand's economic future. We are indeed inflicting damage on this old and loyal friend, and maiming ourselves in the process. In these circumstances the least the Government can do, as the Commonwealth Producers' Organisation has asked is to give a firm promise that they will do everything in their power to see that Protocol 16 of the Treaty of Accession, which provides the machinery by which the enlarged Community can cushion to some extent the blow to our Commonwealth friends, is put into effect and given real force.

We shall have further opportunities of discussing whether or not Associated Status under the Yaoundé Convention will have anything but strictly limited usefulness, in view of the fact that all agricultural products subject to a common organisation of their market inside the Community are excluded from its terms. We know, moreover, that the United States is not well disposed to arrangements being made with developing countries which require reciprocal benefits for the donor countries. Some small Commonwealth countries will need great vigilance if they are to avoid losing valuable trade outlets in the United States at the same time as they are losing their preferential export trade with Great Britain.

Perhaps the greatest danger of all is the likely effect upon the sugar-producing countries of the Commonwealth. It is 22 years, my Lords, since the Attlee Government instituted the Commonwealth Sugar Agreement which gave both security and stability, if not prosperity, to under-developed Commonwealth countries whose very existence depends on selling their sugar at a reasonable price. The much-vaunted "protection" which Mr. Rippon obtained in Brussels was security for two years—two years only, my Lords—after entry. After that the whole economies of these countries will be in jeopardy. All that the Community could bring itself to say was that it would "have at heart" the safeguarding of their interests. As if that was not bad enough, and humiliating enough, Sucrerie Francaise for August/September 1971 emphasised that: "M. Schumann said in precise terms that this document only committed the United Kingdom, and the Community merely took note of it for information". That was the "bankable assurance" that Mr. Rippon had promised, and claimed that he had obtained. In fairness to Mr. Rippon we must conclude that he has a more naïve and gullible bank manager than most of us have.

There is a further complicating factor. If Australia's sugar quota to the United Kingdom is cut off she will have to look for other outlets in the free market. That will mean that next year's renegotiation of the International Sugar Agreement could prove almost insuperably difficult. But we shall return to this, my Lords, at the Committee stage. In the meantime, I will simply say that I dread to think what is going to happen to some of the small Commonwealth countries two years from now, socially, economically and politically, when they realise the shameful way in which they have been betrayed by a country on whose good faith they have come to rely.

To come nearer home, the effect of membership on our regional policy is also something we cannot ignore. How to help the less prosperous parts of the United Kingdom is a problem which has divided the Parties and on which there can legitimately be differences of opinion; but at least we are all agreed that places like Durham, Scotland, South Wales and Ulster need special help. Now, however, your Lordships should know that it appears that if we go into the Community we can only help within certain limits and subject to approval by the Commission, and liable to veto by our fellow Members. So much for the sovereignty which the noble and learned Lord, the Lord Chancellor, claims we are retaining.

This is no idle fear. In April, for example, the Commission informed the Government of Belgium that it must change its regional aid law because most of Belgium was classified as eligible for various investment aids, and because the Belgian system provided what are now called "opaque" aids, like tax advantages which are difficult to quantify. Last week Germany queried with the other Members of the Community parts of the British Government's Finance Bill and the Industry Bill which Her Majesty's Ministers have brought before both Houses of Parliament. In consequence, the Commission is to discuss with Her Majesty's Ministers whether the Bills comply with European Economic Community rules. Five years ago it would have been difficult to prophesy that this House would ever be in that shameful position of knowing that people in other countries are deciding whether Acts which we pass are ultra vices. I have no doubt that this is the first time that any outside body has ever taken such a step. It is an alarming illustration of what lies ahead—an erosion of Parliamentary sovereignty which I believe that most of your Lordships, in your hearts, will regard as lamentable. With consummate delicacy, however, the Commission will take no action against Britain before we are Members of the Community—a small mercy for which we must be suitably grateful.

To highlight the impact of Common Market membership on a Government's wish to help its own casualty areas, the Sunday Times reported on Sunday that the Commission has (I hesitate to use the word) ordered—ordered, my Lords!— France not to put into effect a law giving more generous aid to its depressed areas. If the Commission and France do not reach agreement the issue will go to the Court of Justice in Luxembourg, to which the noble and learned Lord referred, for decision.

I sincerely hope I have not taken up too much of your Lordships' time. This is one of the last occasions on which, even with our already rightly restricted powers, we can speak as one House of a sovereign Parliament. It is possibly almost the last time we can speak as the Parliament of a nation which is the centre of a great and magnificent Commonwealth.

SEVERAL NOBLE LORDS

Hear, hear!

LORD GREENWOOD OF ROSSENDALE

At the Committee stage we can avert at least some of the damage which the Government propose to do, and I hope with all my heart that we shall. But if, in spite of our efforts, the Government are obdurate, insensitive to argument, and unmindful of our greatness and of the obligations which that greatness imposes on us—in other words, if the Bill passes unamended—it will be our duty, as I have said before, to work inside the Community in a way which will reflect our history, our traditions and our standards, and in doing so seek to serve Britain, Europe and the world.

3.45 p.m.

LORD GLADWYN

My Lords, of course this is not the moment to develop once again the case for joining the European Economic Community; almost everything has been said both for and against. Almost everything was said in the long debate we had last October, which ended in a record vote in favour. In spite of the recent vigorous discussions, both in another place and in the country, of the so-called terms of joining I have no doubt that if the House were to divide tomorrow evening—and I understood from the last speaker that it will not do so—there would be an almost equally—

LORD DAVIES OF LEEK

My Lords, may I interrupt? I beg the noble Lord's pardon; but some of us will divide whatever happens.

LORD GLADWYN

I am sorry to hear that. If there is going to be a Division tonight—

LORD DAVIES OF LEEK

Not to-night—

LORD GLADWYN

—or, rather, tomorrow, I have no doubt that there will be an even more substantial majority in favour of entry than there was last October.

LORD DAVIES OF LEEK

My Lords, It will not mean a thing.

LORD GLADWYN

My Lords, I think that is almost taken for granted. And it will be a majority in favour of a Bill which is obviously necessary if we are to join the Community on present terms or on any terms at all.

I believe that the Government were quite right to push the Bill through without accepting any Amendments. If they had accepted Amendments to the crucial clauses the effect of the Bill would have been destroyed, and if Amendments to the less important clauses had been accepted they would have upset the whole Parliamentary timetable, which is exactly what the opponents of the Bill wanted. Therefore I am entirely in favour of the Government's action in, as some people see it, railroading the Bill through the other place. "Railroading" is perhaps not the right term; "pushing" is a more appropriate word. I think they are going to do the same thing here and I personally welcome it.

In any case, the debate since last October has not been about the terms which were, after all, broadly speaking, accepted as reasonable by the already designated Labour negotiators; by two, if not three, Labour Foreign Secretaries, and by nearly one-third of the Parliamentary Labour Party, in spite of a three-line Whip. So there is every reason to suppose that, had the Labour Party won the last Election, they would have had a very large majority in Parliament for substantially the same Tory terms as those which they now denounce so eloquently, and we should have been spared the passions aroused by the outcries of a substantial minority in Parliament—indeed a minority in the country, I would suggest when the facts are reasonably presented and are divorced from party politics—who are fundamentally opposed to our entry for what are after a 11, purely nationalistic reasons. And I think I am right in saying that among this minority can be found the noble Lord, Lord Greenwood of Rossendale.

I do not deny—indeed, I agree entirely with the noble and learned Lord on the Woolsack—that such minority views are usually held sincerely. Neither do I deny that there are many who genuinely believe, on respectable intellectual grounds, that from an economic and perhaps also a political point of view we may lose more than we gain by joining. But, in addition to such persons, there are people who discern in a passionate and almost indiscriminate denunciation of the "Tory terms", a considerable, even a very considerable, electoral advantage. In other words, as I suggested some years ago, this great issue has, unfortunately, become a Party political football. I am glad to say that this has not prevented it from being at last kicked through the right goal, but it has undoubtedly damaged the whole European idea in the process. We can only hope that it will not damage it further in the future. Much will depend on the coming Party Conferences.

For whatever reason, the opponents of our entry, and thus the opponents of the present Bill, have concentrated chiefly, as the noble and learned Lord the Lord Chancellor said, on the so-called sovereignty issue. Is it a fact, they invariably inquire, that one clause or another will imply a restriction on the absolute power of the British Parliament or, as I suppose I should be more correct in saying, The Queen in Parliament? I can sympathise with the Government who in another place seemed (though I may have got the wrong impression) to have been answering both, "Yes" and "No" to this inquiry, with the main emphasis on, "No". After all, they had to get the Bill through over the violent opposition of some of their own Party, with the invaluable support of five Liberals and the connivance of about a dozen highly courageous Labour Members of Parliament.

But we Liberals think that the real answer to the sovereignty query, and the answer which I should have thought could now be given at any rate in your Lordships' House, would normally be "Yes"; that IS to say, of course, on the assumption that the enlarged Community is going to work, if only in a rudimentary fashion. On the assumption that the Community is not going to work, the answer naturally can be "No". So, in a way, the Government can, for the time being at any rate, have it both ways. But even on the second assumption the answer can only be a qualified "No". For clearly, among other things, as the noble and learned Lord the Lord Chancellor has already indicated, we shall be obliged, if necessary, to accept the verdict of the European Court, and shall therefore, at any rate to some extent, be under a supranational obligation.

What must be recognised, however, is that if the European Economic Community carries on in the way in which it is now operating there is very little chance of its developing into any kind of entity—a thing in itself—and still less of its ever being able to engender some kind of Monetary Union. It is all very well to say that we have agreed with the French Gaullists to have a national veto on any decision to which we may object. That is bad enough, because the "Luxembourg Compromise" in January, 1966, has already had as effect a virtual paralysis of all genuine Community activity, apart: from the activity of the Ministers themselves. But if we are also to accept present Gaullist theses, whereby no real power must accrue to a European Parliament that must on no account be directly elected, the Commission for its part being reduced to a purely advisory body of experts and the Council of Ministers continuing to act on the strict application of the principle of unanimity, it is self-evident that what has worked badly—if it can be said to have worked at all—a six will work even worse when the European Economic Community is extended to Ten.

If it really does not work, then it will eventually break up and we shall all naturally recover our famous sovereignty; not that it is likely to be very much use to us in such distressing circumstances. Mr. Douglas Jay, Mr. Peter Shore and Mr. Enoch Powell—strange companions —would be found dancing for joy in a rather grim political and economically depressed area to which our once green and pleasant land of England would by that time have been reduced. On the other hand, if the Community does work, nobody in his senses will want to withdraw in a few years' time, or even at the next Election, since the advantages of the great new democratic entity which we shall by that time be fashioning will be evident for all to see.

So it seems to us on these Benches, at any rate, that the recent contortions of the Labour Party, if I may so describe them, are rather senseless. Far better, surely, if they took the line that the enlarged Community will succeed only if the Government, among other things, go all out to increase the influence of the Commission and, above all, to get the Parliament to work. It is absurd to concentrate on nit-picking about the famous "terms". Even our proposed contribution to the Central Agricultural Fund—which is the most obvious target for criticism—will be quite tolerable if the whole thing works, to say nothing of the strong possibility that we shall, after entry, be able to modify the Common Agricultural Policy to some degree by general agreement: and I myself also believe, in spite of what the noble Lord, Lord Greenwood of Rossendale, said, that we shall be able in two years' time, or whatever the period is, to get a perfectly sensible and agreed solution of the great problems of the Commonwealth sugar-producing countries.

Where the Government can, as we Liberals think, legitimately be criticized is in having—let us hope for tactical purposes only—unduly made their own nationalist theories on which no successful Community can possibly rest. But the idea that Mr. Wilson, on his return to power, could renegotiate the signed Treaty for the purpose of getting a slightly increased quota of butter for New Zealand, or a reduction of a few million pounds in our payments to the Central Agricultural Fund, and organise a referendum if he cannot get his way, at a moment when, on any optimistic assumption, our people in Strasbourg and in Brussels are, no doubt, within the framework of some incipient Monetary Union, hammering out the basis of a system in which there would no longer be any question of any balance of payments issue between members of the Community, would seem to me, my Lords, to be funny were it not so sad. Besides, if Mr. Wilson's referendum went wrong, how would he in practice propose to unstick us from a, hopefully, well-operating economic system of no fewer than (I may be wrong about this) 19 States—the extended European Economic Community, plus the remains of the European Free Trade Association, plus Associates—all bound together by intricate and far-reaching agreements, and with whom we shall probably in a few years' time be conducting over half of our total overseas trade? How would Mr. Wilson be able, technically, to carry out such an operation?

But if, by any evil chance (we must consider everything, I suppose), the present Government had been unable after a few years to make any progress towards a genuinely democratic Community, the Labour Party, I suggest, could quite legitimately say: "This is no good. We are just not prepared to go on playing this silly game. If others want to be entirely nationalistic, intent only on pushing their own interests and ignoring those of all the other members of the group, well, we can be nationalistic, too." In such circumstances, there would be no point in a formal withdrawal, still less a referendum. We should just do what seemed to us to be desirable: for the whole idea of Western European unity would have disappeared.

At the moment, I am afraid that the auspices in favour of early agreement on moves towards genuine unity are not particularly bright, even though many feel that we are being impelled in that direction by the sheer force of events. As a result of the unfortunate referendum last April—which had little to do with "Europe", but much to do with M. Pompidou and his reégime—the President of the French Republic, whatever his own inner feelings on the subject may be, has felt obliged to prepare for the coming elections by an appeal to nationalist emotions and an invocation of the still powerful ghost of General de Gaulle. This is all the more necessary owing to the recent electoral pact between the Communists, the Socialists and other forces on the Left, which, even if it does not result in the formation of a Front Populaire Government and the entry of the Communists into the Administration for the first time since 1947, will probably result in the Left's having between a third and a half of the seats in the National Assembly. With luck, of course, the Centre may hold the balance: but recent developments all over the world have demonstrated the difficulty of increasing or even of maintaining, the power of the Centre.

So what can, unfortunately, be foreseen is that possibly in three but at any rate in seven months, the Palais Bourbon may be dominated by two rival blocs, both of which will in their way be largely dedicated to nationalist theses: the Right because that is their religion, anyhow, and the potential Front Populaire because, in order to clinch the electoral arrangement, the Socialists will have had to make considerable concessions to the anti-European views of their powerful Communist allies. So it can in no wise be excluded, even if there is previous agreement on monetary policy, that the cause of a European Monetary Union may for a time make very little progress, the Luxembourg "Formula" remaining in full force and the European Parliament continuing as a simple talking shop. But there are two factors, if I am not being too optimistic, which may prevent such an unfortunate situation from arising.

In the first place, if M. Pompidou succeeds in preventing the formation of a Front Populaire Government, he may feel emboldened, in spite of some nationalist majority in the Assembly (to which he need not perhaps pay overmuch attention once it has been elected) to return to his previous much less nationalistic attitude, at least as regards the monetary sphere and even as regards the Parliament of Europe. This is certainly what a number of members of M. Messmer's new Government (including M. Giscard d'Estaing) would wish him to do; and, after all, under the present Constitution the French President has very great individual powers in the whole field of foreign policy. In the second place—I hope I am not being too optimistic—I suggest it is likely that when we British get to Brussels, Luxembourg and Strasbourg, we shall be so appalled by the present system that we shall quickly advance some general scheme of reform and induce our partners—yes, even in the long run, the French—to accept it. So as soon as this Bill receives the Royal Assent and before the October "Summit", the Government should give at least some public indication of the way their own minds are working on these great issues. Surely somebody, sometime, must put forward some kind of a "Grand Design", as it is called. Why not us?

The October "Summit" may, however, never take place. If there is agreement on monetary policy before then, no doubt it may be held without any harm, even if the French (like the Germans) should be having elections in November and are clearly, therefore, in no mood to make any departure from severely orthodox Gaullist principles. But if it were for any reason put off, I do not myself believe that it would necessarily be a disaster. After all, before we are actually inside the Community, we may well be at some disadvantage in pressing any of our own ideas, including those for a reform of the present system. Whereas, after January 1 we shall presumably feel able to do so without any residual fear of being blackballed by M. Pompidou. Besides, at an October Summit we might even be bullied into an acceptance of Paris as the seat of the proposed "political secretariat", without any guarantee that it would not be constructed on purely national lines and therefore, to all intents and purposes, a sort of annex of the Quai d'Orsay. Finally, as Herr Barzel has recently said, what will be the point of taking far-reaching decisions on Europe only a fortnight before we know whether President Nixon or Senator McGovern will be in charge of the foreign policy of the United States? I do not want to be too pessimistic about the Summit. It is only that I fear that, in order to avoid some rupture, we may be obliged to subscribe to nationalistic theories about the way in which the Communities should function, before actual membership of the Communities demonstrates to us in a practical way how unworkable such theories are.

To return to the Bill, it must be clear that with all the present clouds on the horizon, the Government are absolutely right to want to get it on the Statute Book at the earliest possible moment. It must also be clear that there is no point in considering at length any of the clauses which were the subject of such prolonged debate in another place. If the Government were determined, as I believe rightly, to push them through unaltered with their small majority in another place, they will obviously be even more determined to do the same with their huge majority here. But what we might do—and here I am perhaps at one with the thinking of the Opposition—is to concentrate on clauses which were not perhaps fully considered in another place, at least in order to get the Government to explain what, in their view, will be the effect of these clauses and what precautions might be taken in the event of difficulties arising when they are applied. In particular, we might ask the Government to develop at greater length their ideas about how we might be expected with success to press our own proposals for making adequate funds available for the development of our regions, and, just as importantly perhaps, their views on how best there could be previous Parliamentary discussion here of all important impending European legislation.

EARL JELLICOE

My Lords, I hesitate to interrupt the noble Lord, but when he refers to "discussion here", does he mean in this House or in Parliament?

LORD GLADWYN

No, my Lords, I meant in Parliament generally, possibly in some Joint Parliamentary Commission.

In conclusion, may I simply say this? We are obviously approaching a very critical period in the history not only of these islands, but of the whole world. The world monetary crisis is symptomatic, and may even be the precursor, of a political earthquake. If we are serious about creating any kind of Western European entity, we must face this crisis with our European partners and consequently, first of all, develop a common European monetary policy. If we fail to do this, and fail to do it fairly soon, then we shall have to forget about our larger European plans and either develop as a collection of small and medium semi-independent directed economies turning eventually towards the Soviet Union, or exist as separate mixed economies and thus as satellites of the vast American Power, without any particular say in the formation of that Power's policies, whether economic or political.

At this point we should all do well to recall the wise words of the noble Lord, Lord Greenwood of Rossendale, who, on July 28 of last year, if I am not wrong, observed in this House that: If, in spite of all our efforts and he meant surely the efforts of the anti-Marketeers— we go into the European Economic Community …We must all of us go in determined to make it work, determined to strive for its success. Failure would mean disaster for ourselves, for Europe and for the world." —[OFFICIAL REPORT, 28/7/71; col. 493.] I must say, my Lords, that I could not agree more with the noble Lord, Lord Greenwood of Rossendale.

The real problem, therefore, is how best to form a democratic community in Western Europe which, without being in the least anti-American or indeed federal in the popular sense, would nevertheless be capable of having an individual policy. So far it will be seen that I am perhaps not very far from the thinking of many Frenchmen, including a number of Gaullists, and almost certaintly, in spite of his present political difficulties, the President of the Republic himself. But what so many Frenchmen and indeed so many British fail to see is the sheer impossibility of assuming such an attitude or adopting such a policy in the absence of European institutions in which it could first be formulated and then generally applied. It is useless to suggest that we can face our huge problems in this little corner of the world in dispersed order, and in the belief that somehow a consensus will be arrived at "pragmatically", as it is always said.

It may be that agreement on suitable institutions will be forthcoming only when the thunderstorm is bursting over our heads, in which case in all probability it will be too late. But that agreement on institutions must pre-any durable policy in any really vital area seems to me, as a general proposition, to be incontrovertible. It may be—let us sincerely hope it will be—possible to arrive, for instance, and for a temporary period, at a common monetary policy for the enlarged Community; but it is inconceivable that there should ever be a Monetary Union of a stable character without an authority which will have the power to decide on what, in any crisis, should actually be done. Nor is it conceivable that such a union could be formed without what would, in effect, be an economic union as well. Those who, like the Government, say that they desire this end must also necessarily accept the means.

I shall not occupy your Lordships' time any longer. 1 would only add one thought. Perhaps it is a blessing in disguise that the difficulties in the way of forming a coherent entity in Western Europe should present themselves before we join. For at least we now know what they are and can bend our minds on how best to overcome them alter our entry. It is hard to imagine how, for instance, once the Community is extended, any member could continue to retain the right to float or devalue its own currency by itself without some kind of common consent, for to do so could be to repudiate the whole conception of a Community from the start. And yet, how can such consent in practice be accorded or withheld?—only by some organisation capable, by voting or by some other means, of reflecting a general will. If we and the others are not prepared to admit this principle, then, as I have said so many times, the Community will founder. It may continue to exist as an industrial free trade area, though even this is doubtful. In any event, it will be better for us to be inside rather than outside the existing body, whatever it may be, for then we shall at least have some influence on its future. If only out of an instinct of self-preservation, we should therefore hasten to approve the present Bill. And, after all, the larger hope remains.

I myself have for a long time entertained this larger hope. What we are faced with now—not only here but all over the world—is a crisis of authority. What we need, therefore, is some guiding line, some new, generally accepted philosophy. Where shall we seek this? Perhaps not in my own lifetime, but one day, I am sure, the new democratic Europe of our imagination will emerge as a light to lighten the Gentiles in a dark world of super-Powers and super-poverty. Some will say that it is absurd to apply biblical language to what are essentially problems of Realpolitik, and no doubt, in a way, it is. But in this country it has always been faith which has resulted in our most splendid triumphs; faith in ourselves of course, as a band of brothers, but faith also in some great idea of general application. If we are so inspired to-day, we shall walk unscathed into a lowering and uncertain future.

4.14 p.m.

VISCOUNT WATKINSON

My Lords, I should in addressing your Lordships' House start with an apology as I have spoken twice before on this subject, in March, 1970,and July, 1971. But this is one of the greatest decisions that any Government have taken in my lifetime, and although other commitments do not always allow me as much time in your Lordships' House as I would wish, I felt that I must come here to-day and register my strong support for this measure. I do not wish to follow the noble Lord, Lord Greenwood of Rossendale, or the noble Lord, Lord Gladwyn, in their very able political remarks, but I should like to try to stick to some fairly practical facts as I see them. As my noble and learned friend the Lord Chancellor said, there are two very honourable and sincerely held views on this subject and they are totally opposed. I often wonder whether it would be right if this were not so on a subject that will affect our lives and those of our children and grandchildren after us. I do not, as the speakers before me have done, seek to raise controversy, but merely to try to set out the facts quite shortly as I see them and to say why I stand where I do.

The only point that I should like to make about those who oppose this measure, and thus the entry into an enlarged E.E.C., is that they so often seem to me to imply that joining Europe is not really good enough for Britain. In the light of the circumstances in which we find ourselves in 1972, I wonder whether we should not at least consider the possibility that Britain, sadly enough, is not going to bring as much into the Community as we might have hoped some years ago. So delay is not on our side. The lesson that I would draw from this is to venture to suggest that we should put the millions of words and acres of print on this subject behind us and pass the measure in front of us with as little further acrimony as possible. The country can then get on with concentrating on the task of making the most of the new opportunities that will then be opened before us. I do not think any opponent of the Bill would claim that entry into an enlarged Community will not present us with many new opportunities and, no doubt, many new challenges.

If I may say one word to the noble Lord, Lord Greenwood, in his absence, he seems to forget that facing decisions in the Community as a full Member, participating in and being a party to all of them, is quite different from facing quite reasonable queries from the Community when we are in this twilight stage of being neither out nor in the Community. When we can make our own case and stand up for our own beliefs within the Community, if we then cannot get a reasonable measure of our way and have a reasonable effect on the continuity of the Community's policy, then we have no future as a nation in or out, if that is the level of our capacity to-day. What is the political alternative before us if we do not pass this Bill and thus be enabled to ratify the Treaty? Would anyone want to inflict on any British Prime Minister, and thus our country, the real humiliation of going back to the Community and saying that after all the negotiations, and after the agreement reached with the Community itself, Britain did not now intend to implement her own decision to join Europe? Could we really hold up our heads in the world in any capacity if we did that now?

Having tried to make a plea that after the honourable division of view, the controversy, and all the rest of it—all of which was necessary—I believe that we should now come as quickly as we can to the point of decision. I say that particularly at this time because I believe that entry into an enlarged European Community not only provides us with many new things to do, but might be exactly the test that would harness our nation's unrivalled capacity for united endeavour, once it realises that the endeavour is not only necessary but inescapable. Perhaps some noble Lords might agree that that test needs applying to our nation now.

It seems to me then that what an outside and rather unprofessional Member of your Lordships' House should try to offer at the concluding stages of a great and historic debate is nothing about the nuts and bolts, but something about the conviction that we should now set the seal on this decision for ourselves and those who will come after us. I am well aware that in the immense fund of practical knowledge that rests in your Lordships' House this is not an easy task. Yet in all great decisions in one's lifetime there is an element of judgment; there must be an attempt made to draw on the facts that one knows, one's own practical experience and knowledge, and then to express it as best one may for or against the issue that confronts the country and Parliament. I feel only too conscious that all I can contribute to this great new edifice of an enlarged European Community is a singularly small brick, but at least it will not now take me long to lay it.

I have four practical reasons why in my judgment I believe this House can do no other than pass the measure now in front of us. The first is three years' practical experience of working closely with my European colleagues, a fair time ago, as British Minister of Transport and Civil Aviation when we were discussing the first bringing together of European transport policy, of road building ideas, of common standards and so on. As chairman for a time of the European Ministers of Transport, I did not find the experience of working with my European colleagues other than rewarding and stimulating; it led to sensible decisions which were practical and rewarding.

Secondly, perhaps more important, as British Minister of Defence I was involved in an alliance which I have always been surprised to find has not formed a larger part in our debates on the Common Market; that is, NATO. This alliance involves a much greater cession of sovereignty in decisions literally involving the life and safety of everyone in Europe than anything, as I understand it, in the proposals before us. Under the pressure in my day of a much harsher confrontation with the Eastern Powers in Berlin and elsewhere, I remember working with my European colleagues, who included the present Prime Minister of France, closely and sensibly in all the work of NATO. It worked well and it kept the peace at a time when peace was perhaps more threatened in Europe than it has been for many years.

LORD SHINWELL

My Lords, would the noble Lord permit me to ask him a question in view of what he has just said? How does he account for the fact that France has contracted out of NATO?

VISCOUNT WATKINSON

My Lords, my answer, as I expect the noble Lord supposes, is that I do not know. All I am saying is that when the present Prime Minister of France was their Minister of Defence I found him an excellent colleague, as I did all the other European Ministers. We worked closely together and faced the aftermath of the Berlin Wall and a number of other things. I am only recording what I know from my experience. I worked with a number of men, some of whom are still on the European stage; I found them good colleagues, people with whom you could expect to do things and to make progress. Although I do not disagree with the noble Lord, Lord Greenwood, in his affection for the Commonwealth, we have to do something new. That was my defence to a prominent Australian politician for what we are doing now. If there is something new to do in the Commonwealth as well, then let us do it. At least there is something new to do across 25 miles of water and I hope that we shall get on with it.

Thirdly, as I have said before in your Lordships' House, my day-to-day practical experience of working closely together with European colleagues in the business and economic sphere and in travelling regularly to almost every part of the present community, provides me with practical evidence of the real advantages that can be taken if we are willing to take the opportunity. If not, then we have not much future as a nation. There are opportunities in terms of higher standards of living, wider ranges of employment, and better chances for regional policy. I do not know why the Commission or any nation member of it should query our regional policies. They are in a total mess about their own policy. They have not yet formed a total international or community regional policy. A number of my colleagues in Europe have said to me that they are anxious to have the benefit of our experience so that they may question and debate with us the best kind of regional policy in an enlarged Community. I do not think we should be frightened of getting into that discussion.

Fourthly and finally, when I first became a Member of another place as a young and green Member, I was given good advice by one of the elder Members of my Party. I have always tried to stick to this advice. He said that when one comes to a great decision one should do what one thinks is right and damn the consequences. All I can say is that I think it is right that we should pass this Bill with as little more ado as possible. It is right that our country should try to seize the opportunities which lie in Europe. If we do not there is not much future for us. Therefore I strongly support the Second Reading of this Bill and I hope that it will go forward with maximum speed. I only express it as my belief—I do not expect everyone to agree with me—that by so doing I am doing the right thing for my children and grandchildren.

4.25 p.m.

LORD ALPORT

My Lords, as this long debate, which the Lord Chancellor advised us has taken place over ten years and more, is now drawnig to a conclusion I have found myself increasingly convinced that the fundamental policy which this Bill seeks to implement is not only right in the circumstances which exist at present but is right even if there were practical alternatives available to this country in other directions. For instance, it would be right even if the Commonwealth were still in being; if a special relationship with the United States were possible on acceptable terms or if we could retain prosperity and security in "splendid isolation". Even if any of those three things were possible I should still support our entry into Europe.

If the terms upon which that entry had been negotiated were more onerous than the ones which exist I would still regard this Bill as right for Britain. My reason is that the great conception of a united Europe which emerged from the turmoil and disaster of the last war cannot be fulfilled politically within this country. The noble Lord, Lord Greenwood of Rossendale, talked at length and with great eloquence about the Commonwealth. But it seemed to me that he was speaking in terms of the Commonwealth of 1925 or 1931, or even perhaps as late as 1955 when Britain was still, to some extent at any rate, the metropolitan country of a transformed imperial system able, so it appeared to the various countries of the Commonwealth, to provide for them a system of security, economic advantages and political guidance whether those countries in their population and extent were great or small.

That is not the situation to-day. It is not true for one reason. That is not because of the inroads of Communism or the activity of anti-Colonialism, or indeed the changes which have taken place in the physical and outward appearance of the world, but it is the result of two wars which originated in and were fought to some extent in Europe, which have destroyed the power of Britain to provide the services for Commonwealth countries which were previously expected from us.

If the noble Lord, Lord Greenwood, does not realise the facts of the Commonwealth to-day—and that was the impression which his speech gave me—the Governments of the Commonwealth certainly do. They know, and indeed they knew as far back as 1947 in the case of Australia and New Zealand at any rate, that Britain cannot provide the conditions of security on which they had previously relied. They know that we cannot provide the markets for all their primary production; Australia has been very realistic about this. All the countries that are independent to-day know we cannot, and frankly do not wish us to try, exert over them the political influence which once was available to them. We know perfectly well that the countries of the Commonwealth have been making their dispositions accordingly over the last twenty years. They have been finding new markets, and in new alliances alternative sources of security. They have been developing their own regional organisations in Africa, Asia and elsewhere.

I understand, and we all understand, that they are reluctant to lose some of the residual advantages in various of the British markets; for instance, as the noble Lord said, in the case of sugar. But they also realise that the value of Britain to them as a powerful member of the European Economic Community is far greater than it would be as a declining market for their primary production, becoming increasingly financially impoverished and with a declining political influence both in Europe and in the world. I can assure your Lordships that Commonwealth leaders do not take the narrow view of Britain's future or of their countries' own interests, which was evidenced in the speech of the noble Lord, Lord Greenwood of Rossendale. Indeed, I was sanddened to hear the thinly veiled disparagement in that speech of some of the other countries of Europe. It is a form of nationalism with which we are only too familiar and which one was hoping one would not hear at any rate from the lips of a spokesman of a Party which, at least in my younger days, stood for international idealism, and indeed attracted many of my own generation to its ranks for that very reason.

There was reference to the political instability of Italy and the change of Government in Holland, and to some remarks by the President of France. My Lords, it is precisely because European countries are looking to Britain for political leadership—they will not acknowledge it publicly; they will not acknowledge it to the people of their own country—that they want us in at the present time. It is not for economic reasons; we must he quite clear about that. There will be economic advantages from Britain's point of view, but from their point of view—that is, from the point of view of Western Europe, of Free Europe—the entry of Britain into the Community at this present time will give an opportunity—so they see—of reviving the political will and the political cohesion of the European Community; give new inspiration and bring to them those things which they urgently require. This was made very clear to me when I was in Brussels 10 days ago at a conference at which most of the members of the European Commission were present. What they require is in fact the resources of British statesmanship and the long descended political experience of this country, so as to be able to get them out of some of the very grave difficulties in which the Community is at present.

I wondered, as I listened to the speech of the noble Lord, whether he wanted the E.E.C. to collapse. I wondered whether he had thought what the prospects for Europe would be if in fact the E.E.C. did collapse. Does he and those who think like him want to rely indfinately upon the United States, for instance, to provide security for Europe? And do they think the United States, under the régime which may come into being there, is indefinitely going to carry the full burden—as it has done so gallantly and generously over these last years—of European security? I see the future of Britain in Europe not merely as a factor in our economic future and progress, but also maintaining and developing both political institutions and political association, and leading to greater security from Europe's own resources, not relying, as we have done in the past, upon assistance from outside. We are not going into Europe, whatever noble Lords may think and say, as suppliants. We are going, taking with us a contribution to the future of Europe which, as I said earlier on, no other country can supply.

I find, as I have said in this House on a previous occasion, that my ideas have changed over the last 10 years. There was a time when I believed that the Commonwealth could be made a viable proposition, politically and economically. That idea has long passed. The opportunity, the alternative, is no longer there. I had believed even earlier that there was a possibility of this country's going it alone. I no longer regard that as a desirable or honourable course. What I regard as a great historic policy and a great historic decision is that of going into Europe and trying—and, I have no doubt, succeeding— with the influence that we can bring to bear on the countries that are going to be our partners in Europe, to ensure the security and progress of the Free World. Nobody can have an interest in the continuing weakness of Britain: neither Europe nor the Commonwealth, nor anywhere else. Therefore, all, whether they be concerned with the Commonwealth sugar agreement, with tariff facilities and advantages for the British market, with some form of security arrangement between Britain and themselves, have an interest in Britain's strength. And that can only, in my view, in the present circumstances, be revived and fortified by joining the Common Market.

I do not pretend that all the things that are going to happen during these next few months and years when we become a member are going to be easily acceptable to long-established prejudices and points of view in this country. But there is no point in our going into a partnership with other countries without being prepared to make some sacrifices in relation to them, because, my Lords, we will expect them to do the same for us. As a result of that, we shall move one step nearer to an ideal which I should have thought was shared between the Party opposite and all Members of your Lordships' House on all sides; which was moving towards a better system of international partnership and cohesion and international Government than has existed in the past. I know that that is the kind of ideal which appeals to Europe. It is an ideal which can replace some of the faded and dead ideals of the past, and if we in this House were to fail at this time fully to support it we should not be easily forgiven by the next generation.

My Lords, the noble and learned Lord the Lord Chancellor gave a full and, to me, a very complicated explanation of the legal aspects of this Bill. Whether its drafting is right or not, I do not know. Whether the form it takes is right or wrong, I cannot tell. But, in so far as it will promote the progress of an ideal and a policy which is essential to the people of this country, I support it wholeheartedly. And in the art of the possible, in which we were all brought up to believe, the possibility at the present time is getting this legislation on to the Statute Book in order to ensure our entry at the beginning of next year. I do not think, from such experience and study as I have been able to make, that the changes will be nearly as catastrophic or far-reaching as anybody expects; they will be slow and gradual. But, as I have said, it is on the political side that we shall be able to make a considerable contribution.

I would say one other thing, and this again relates to a point which the noble Lord, Lord Greenwood, made when he said that we were not going to be able in this country, in this Parliament, to influence decisions of the European Community and the Council of Ministers, except in so far as we should have one voice in 10 or a few representatives in the European Parliament. There is one thing we must work for as early as possible after our entry into Europe, and that is to transform the basis of the European Parliament from its present indirect election to a basis of direct election for all the countries concerned. I realise that this will take time. It is something which I know the Commission in Brussels would greatly welcome because they would feel that it would strengthen and fortify their own position at the present moment, dependent as that is entirely upon their own interpretation, on the courts and on the Council of Ministers. This is a contribution—a representative democracy by direct election—which we, perhaps of all the nations in Europe, are best qualified and entitled to bring to Western Europe, to the European Community; and this is something that we should not hesitate to push forward as quickly as we can. I hope that we shall not be considering this problem in relation to 44 volumes of Statutes or laws (or whatever they may be) of the European Community but that we shall be considering this Bill, at any rate on Second Reading, upon the principles and ideals which lie behind it and, what is more, in relation to the opportunity which it provides, not only for this country but for the people of Europe as a whole.

4.41 p.m.

LORD STOW HILL

My Lords, we were privileged to listen to a most enlightening introduction by the noble and learned Lord the Lord Chancellor to the reasons for, and the grounds for shaping this Bill as it has been shaped.

I should like, as my contribution—which I hope will not be too humdrum and pedestrian—to follow him rather more closely in some of the questions he raised. It is, I know, the purpose of my noble friends on this side of the House in the course of the Committee stage of this Bill to formulate Amendments designed, among other things—not wholly—to elicit from Ministers answers to questions which I think it is in the general public interest should be given at the earliest possible moment.

I approach this debate on Second Reading upon the basis that the question whether or not we should accede to the Community on January 1, 1973, has been decided in the affirmative. My own reading of your Lordships' custom on the constitutional basis is that when a measure of this great, transcendent and historic importance comes to us from another place, after heated debate and discussion there, we should broadly, as a matter of general custom, accept at any rate that in its outline the Bill should go on to our Statute Book. My approach is upon that basis. Also, if I may make my own position clear and may borrow the common jargon, I speak as a convinced pro-Marketeer.

The noble and learned Lord was followed by my noble friend Lord Greenwood of Rossendale, who made what I thought was a most admirable speech—with all of which I disagreed. I thought it was delightful to listen to, and as I listened to him I felt that I might be reading one of the glowing pages in Edward Gibbon's Decline and Fall of the Roman Empire. But I shall not follow him further in that because, having soared, I hope, for the moment to the exalted plane on which the discussion has so far proceeded, I want now to come down to what I would describe as the humdrum and pedestrian basis on which I should like, if I may, to put questions to Ministers to which I hope they will in due course furnish answers.

If I may say so, I entirely agree with the noble and learned Lord that the Government were right in choosing what I believe he called "the middle course". I think none of us would have found it acceptable to have a Bill which might have enabled Parliament by Statutory Order to achieve entry: equally, while it is no doubt theoretically and ideally desirable that the subject should be able to read the printed word in a Statute it would not have been practicable to have what the noble and learned Lord called a "1,000-clause Bill". The alternative which the Government have adopted seems to be the only sensible and practical one.

At this stage may I pay a tribute that I think is much deserved; and I hope your Lordships will join with me in paying our homage and expressing our thanks to a great public servant with whom in years past I have been privileged to work for many hours of the day and the night, Sir John Fiennes, who, with his team of expert Parliamentary draftsmen has produced a draft which is quite admirable. I think it is most skilfully drafted, most imaginative and a brave attempt to face up to this really staggering problem with which he was confronted. Parliamentary counsel do not get many thanks; they must find it difficult sometimes when people stand up to try to explain what they have put in print without really understanding their purpose as fully as they might. That is a cross which they have had to bear for decades now. But this draft, while I would have criticisms with regard to it on matters of detail, is, in my view, broadly the right approach and is most skilfully conceived and devised.

With that introduction may I come to the questions that I should like to ask. I shall not ask any questions on Part II. I agree, if I may say so, entirely with what the noble and learned Lord said; that the purpose of those provisions and the Schedules that go with them are perfectly plain. But there are questions that I should like to ask on Part I, Clauses 1, 2 and 3, and Schedules 1 and 2, which go with them.

I was most impressed with the warning that the noble and learned Lord gave me—I hope it was not addressed to me specifically—that I should not seek to introduce into a Second Reading debate matters which were more appropriate to the Committee stage. I will try to avoid doing so. On the other hand, this is a Bill of great importance and it is difficult to follow for those who, outside the circle of this Chamber, will be affected but who have not the opportunity to devote precise study to the terminology of the Bill and to know exactly where they stand in relation to it.

I should like to group my questions under four headings. First, I should like to look at Clause 1 and ask myself what are the Treaties with which we are concerned as set out and defined in Clause 1 and the first part of Schedule 1? It is so important to know what are the Treaties one is concerned with because, as the noble and learned Lord told us, Clause 2 has the effect of embodying at any rate parts of them in our legislation without more, and the liege should be able to say to himself: "I am—or am not —affected by such-and-such a provision of such-and-such a Treaty". Therefore that will be my first set of questions and, if I may, I will come back and elaborate on them in a few moments.

My second set of questions will centre upon Clause 2 and I will ask Ministers how Clause 2 works: whether it does not undertake a burden which we are not obliged to undertake by the terms of the Treaties and whether, in particular, we are bound by any language in any of the Treaties to do more than make the regulations which are passed under Article 189 of the Rome Treaty part of our law, without more, and to provide that the directives which are referred to in Article 189 shall be given effect to by appropriate legislation in language of Parliament's own choosing, and perhaps the same with regard to what are called "decisions" in that Article.

My third set of questions will be related to what has been referred to as "the veto". Your Lordships may remember that in the White Paper that was published in July, 1970, this passage occurred — and I quote from page, 8, paragraph 29: On a question where a Government considers that vital national interests are involved, it is established that the decision should be unanimous. Like any other treaty, the Treaty of Rome commits its signatories to support agreed aims; hut the commitment represents the voluntary undertaking of a sovereign state to observe policies which it has helped to form. There is no question of any erosion of essential national sovereignty; what is proposed is a sharing and an enlargement of individual national sovereignties in the general interest. That question is, I think, in the discussions on this matter generally coupled with what is referred to as the Luxembourg Agreement, and I should like to press Ministers a little more closely for information about that.

My next and final group of questions (your Lordships will be pleased to hear that it is final) centres upon Clause 3. Clause 3 of the Bill is one which is designed to describe and formulate the position of litigants in this country, at any rate for the major part, who are proceeded against in respect of an allegation against them either that they have broken a regulation or that they have broken some other Community obligation. A "Community obligation" is defined in Part II of Schedule 1, on page 20 of the Bill, as: any obligation created or arising by or under the Treaties, whether an enforceable …obligation or not". In parenthesis, I would be most grateful if Ministers would be so good as to tell me what they have in mind as an "unenforceable obligation". It seems to me to have a slight contradiction in its middle, but no doubt that can be easily resolved.

May I therefore come back to Clause 1. I have, I confess, always in my approach to the problem of the Common Market supposed that our obligations would be largely, if not entirely, centred upon the Rome Treaty of 1957, the Iron, Coal and Steel Community Treaty and the Atomic Energy Treaty. I thought those were the three, and if one looked into those Treaties one would find what was the measure of the obligation that this country undertook by entering into those Treaties. If that is right, one is always, of course, perfectly safe in saying that there need he very little fear, at least in my opinion, of there being any real encroachment on British sovereignty, because they are limited to the field of economic activity and could not, for example, possibly entrench upon matters of defence or anything of that sort if we were only concerned with those Treaties I think that position would be perfectly safe. But if one looks at Clause 1, one finds the Treaties described as, first, "the pre-accession treaties". If one looks for the pre-accession treaties, one finds them defined in Part I of Schedule 1; one finds that they include the Rome Treaty, the Iron, Coal and Steel Treaty, and the Euratom Treaty dealing? with atomic energy.

Then there is a paragraph which seems to go much wider; among the pre-accession treaties in Part I of Schedule 1 one finds paragraph 7: Any treaty entered into before the 22nd January 1972 by any of the Communities (with or without any of the member States) or, as a treaty ancillary to any treaty included in this Part of this Schedule, by the member States (with or without any other country)". I do not know what "with or without" means. Does that mean that the country must be on the same side as the Community or the opposite party to the treaty? That is a matter we can examine a little later.

The noble and learned Lord the Lord Chancellor said that it would be for the British courts, if a treaty were produced, to look at that treaty and say, was that treaty within the meaning of English law an "ancillary" treaty? It is, I should have thought, imposing upon Her Majesty's leiges some uncertainty if they are left in that situation. It goes further than that. If one looks back to page 2 of the Bill in Clause 1 one finds that not only are there the accession treaties as so defined which one is concerned with, but there are included also any treaties which fall within the scope of this extremely general language: any other treaty entered into by any of the Communities, with or without any of the member States, or entered into, as a treaty ancillary to any of the Treaties, by the United Kingdom". Those are very wide words. They are not limited in time. They can be before January 22, 1972, or after—ten years hence.

THE LORD CHANCELLOR

My Lords, I wonder whether I could help the noble Lord. I think he will find, in order to help him develop this point, that Clause 1(2), to which he is referring, has to be read with Clause 1(3). Although it is true that the words of Clause 1(2) do not have a limit of time, Clause 1(3) does have a curious limit, because it provides that the Order in Council specifies the Treaties, and in the case of future treaties you will find that only those which are specified in the way designated by Clause 1(3) are included. That is the result of the words "other than a pre-accession treaty" which come about halfway down the paragraph, subsection (3). It is a rather difficult piece of draftsman- ship. I was not quite sure whether the noble Lord had appreciated that nicety.

LORD STOW HILL

My Lords, I am extremely grateful for the noble and learned Lord's intervention. I had in mind those words. Again, I do not want to go into technicalities, but may I say in two words that I thought that they could apply only to a treaty entered into by the United Kingdom after January 22. But this is a technical point, and I will not trouble your Lordships further with it.

The general question I should like to ask on that is this: would it not be feasible to list the treaties, at any rate those entered into up to to-day, so that at least one would know what is the material one is talking about. In the other place there was constant reference to eight volumes of treaties and ancillary documents that go with those treaties. That sounds very terrifying. I have done my best to look at those eight volumes, and I think probably in our own parlance when we talk of "volumes" we envisage a rather fat tome, but they are volumes more like this, which I have here, thin volumes with not so many pages and loose covers, so it is not as frightening as all that. But I make the point that perhaps it would be desirable to consider —we might explore this further in Committee—whether at least we should not have some idea as to what are the paper documents referred to. Would it he so difficult to go through the ones that there are and list them, and then at least the subject would know what he was concerned with. At the moment it is left very largely in the air, with the exception of the three recognised pre-accession treaties to which I referred.

When one has discovered which the treaties are, one has then to perform the process in Clause 2. I am afraid I may be a little bit technical about this, but this is a matter of such general importance that I hope the House may bear with me. Clause 2 requires you to take the document, the treaty or whatever it is, and to perform this process with regard to it. You have got to go through it and extract from it anything that could be called a "right, power, liability, obligation or restriction"—and one or two other things I will not bother with. When you have done that, you have to perform the further process and ask yourself with regard to those categories of provisions whether they fall within the words: as in accordance with the Treaties are without further enactment to be given legal effect". I have looked at the Treaties, and I probably missed the words and I should be most grateful if the Ministers would be so good as to enlighten me. The only obvious case that I know of is in Article 189, which deals with regulations. Your Lordships will have looked at it many times. Article 189 is the Article which deals with regulations, directives, decisions and opinions. That Article most certainly does provide with regard to regulations that they shall be binding in every respect and directly applicable in each member State. That is providing with regard to regulations that they are to be part of our law without further ado.

It does not make the same provision with regard to directives, because a directive shall be binding in every respect of the result to be achieved, but the form and manner of enforcing them shall be a matter for national authorities. So that the only wording in the Treaties—and I am quite sure I have missed other wording—which requires that any treaty obligation is to be without more part of our legislation relates to regulations. I would ask this question of Ministers. Do we, by entering into the Treaties, undertake to do more than make regulations automatically part of our law, and undertake further that when directives are passed we will, by language of our own choice, by our ordinary process of Parliament, make them part of our law? That is my second question, and closely with that I put two supplementaries, if I may so describe them. I should have thought that subsection (1) of Clause 2 applies not only to existing but to future obligations because it contains the words from time to time created or arising I will not take more time on that. Subsection (2) was designed to enable Community obligations to be implemented and, I should have thought, to deal with directives—I do not know whether I am right about that.

May I pass on to my third category of questions. I have tried to discover what happened when the Luxembourg agreement was entered into. I think I am right in saying that when a proposal was put France—I am not sure whether it was in the Council or in the Commission—objected on the ground that that proposal would affect her national interest, and the representatives of the other member countries present simply took note; so it does not sound very much like an agreement. It was a recognition of a position. But could we not go further than that? My Lords, is there something more binding, more concrete and more clearly formulated than that in the Luxembourg agreement or in subsequent agreements that may have been entered into upon that footing? I think my noble friends may wish to put down on Committee an Amendment suggesting that if we really think—our opinion being expressed by resolutions of both Houses of Parliament—that some provision of a treaty or regulation would vitally affect our national interest, within the meaning of the White Paper passage which I have quoted, that that should not automatically become part of our legislation. I will not take more time on that.

It is not very much of a safeguard for us simply to have the Luxembourg Treaty in this very vague form. We all know that part of the Charter of the United Nations is that there is a veto power in the proceedings of the Security Council. It can only vote, or rather vote effectively, on any matter other than a procedural matter if the seven permanent members agree. I should have thought, my Lords, that if there was some sort of provision which possibly after we had entered, might be negotiated, perhaps by way of an Amendment to the Rome Treaty, it would give this country a great deal more security and perhaps go some distance to allay the anxieties of noble Lords and honourable and right honourable Members of another place who feel anxiety about our joining.

That brings me to the fourth and final category of questions that I wish to put. They are centred upon Clause 3, which is designed to tell a British company, a British industrialist, how he stands supposing somebody comes to the courts of this country and says, "You have infringed a Community regulation and by so doing you have caused us damage.

We are asking for an award of damages against you. "My Lords, first I would ask the general question, Am I right in supposing that a British company could in fact be sued in our courts in those circumstances? Perhaps I may give an example. Supposing one starts with Article 85, which prohibits a number of envisaged restrictive practices. Article 85(1)(d) prohibits the application of unequal conditions to parties undertaking equivalent engagements in commercial transactions". If one of my customers, being an industrialist, complains that I have given more advantageous terms to his rival could he sue me? I should have thought that the answer was "Yes". I hope these are not too much of Committee stage points but I am drawing attention to them because they vitally affect an enormous number of people in this country.

I do so agree with the noble Lord, Lord Alport, that the sooner this Statute, whatever its final form, is on the Statute Book the better. It will remove much uncertainty and I hope it will assist to promote the flow of industrial investment and help to get our unemployment figures down and also enable our economy to expand. I would imagine there must be countless boardroom decisions awaiting the answer to the kind of problem I am now asking about and that is why I ask it. Supposing I am sued—and the Commission, I think, imposed a fine on Imperial Chemical Industries not so long ago, a decision that was upheld in the European Court—I expect the English courts would decide the claim interpreting the relevant regulations by English principles. But what happens then? Supposing this English company relies on that decision—let us assume that it is in its favour—and that it continues the practice of which complaint has been made and, say, five, six or ten years later when perhaps millions of pounds have been spent on that practice on the assumption that the practice does not constitute a breach of the Regulation, the European Court pronounces a ruling which shows that the English court's ruling was mistaken or. at any rate, was one in conflict with the European Court's ruling—which quite clearly must prevail under the terms of the Treaty—how does the English company stand?

My Lords, I ask this question: suppose a regulation is passed which an English court would say was wildly and absurdly outside any possible power that could be said to be conferred upon any of the Community organisations by the Treaty. May I take an extreme example. Supposing the Commission and then the Council of Ministers, despite the opposition of our representatives, said we were to reduce our armed forces by nine-tenths and a question came before an English court centring on a regulation of that sort, could not an English court say that that is ultra vices and refuse to be bound by it? If the Commission or the European Court disagreed with that view would we not have to say: "Disagreement or no, the view of the English should prevail". That brings me to the end of the questions which, as I have said, we should like to explore much further on Committee.

May I say that I do not speak in any spirit of hostility; on the contrary, as I have said, I should like to see this Statute on the Statute Book at the earliest possible moment so that everybody will know where they stand. The only reason I venture to take up your Lordships' time on this rather uninteresting discussion—your Lordships may very well think it is uninteresting especially after the magnificent speeches to which we have listened—is that I honestly think that a large number of people in this country in industry, commerce and in the trade unions, in fact everywhere, must be wanting to know how they stand and are finding it extremely difficult to do so.

Rererence has been made to 41 volumes of Regulations; they are not quite as terrifying as that sounds-28 of them are concerned with Regulations affecting the Common Agricultural Policy. If your Lordships care to look at our own Statutory Rules and Orders in the Library, the volumes there are not thin volumes like the one I just picked up, but are stout volumes, solid volumes of a thousand pages each perhaps. I have made a rough count and our Statutory Rules and Orders in the last 40 years fill some 60 of those volumes. As my noble friend Lord Greenwood said, he did not think anyone knew where they stood under the Regulations, and I should be highly surprised if any of our citizens knew where they stand in relation to our Statutory Rules and Orders as contained in those 60 immensely thick volumes. These are not so frightening and if one goes back to Article 85 one finds one single regulation implementing it, Regulation 17, so really that is not so terrifying.

Those are the questions which I would respectfully put to the Government Front Bench and to the noble and learned Lord and, as I have said, I personally and, I believe, my noble friends, would like further in Committee to explore them by appropriate Amendments in order to seek as much information as possible from Ministers as they are in a position to furnish.

5.9 p.m.

LORD AUCKLAND

My Lords, a very heavy responsibility falls upon your Lordships' House in the next few days as we go into the final canter, as it were, to this historically important decision. I agree very much with what has just been said, that another place having given a narrow blessing to the Bill, we in this House have the job of trying to suggest any improvements which may be made, any additions or any subtractions, and to try to elicit some of the more technical information which many members of the general public do not understand.

The noble Lord, Lord Stow Hill, made an invaluable contribution to this debate when he dealt with the legal side. This was dealt with at some length in another place, but it is certainly not readily understood by the vast majority of people in this country; yet it is a vital aspect of this Bill. One thing is certain: the accusation that this legislation is being thrust on to the people of this country—and I have heard this expression from many members of the public, many people whom I have met—is not fair. It is, I believe, 20 years since these negotiations were started, and they have been discussed exhaustively in Parliament. Of course there have been a number of changes, some recent, particularly in France, and certainly some of these changes continue to worry many people in this country. They are quite right to be concerned.

So far as I am concerned, I do not regard this as an exciting adventure. I am certainly not a sufficiently committed European to take that view. The approach which I make, albeit perhaps a negative one, is one which I think many people make, particularly in the world of business, namely, what is the alternative? As some of your Lordships will know, I was in New Zealand last year for a month, and I had the opportunity of talking to a number of businessmen and other people on this vital topic. Indeed, it was one of the questions which I was asked most often, even though I was not out there at the behest of either Her Majesty's Government here or the New Zealand Government, but as a guest of the Auckland City Council for their centennial celebrations. At that time the right honourable gentleman the Chancellor of the Duchy of Lancaster had just left New Zealand, and the terms for New Zealand were not known at that time; but particularly among the business community there was at least qualified support for entry. The words of both the High Commissioner for New Zealand here and of Mr. Marshall have been quite clear. In fact, I listened to Mr. Marshall when he was last over here addressing the Anglo-Anzac Parliamentary Association.

It has been made quite clear that this is Britain's decision, but quite reasonably and understandably they have asked that certain special considerations are given. I believe that the right honourable gentleman the Chancellor of the Duchy of Lancaster has in fact managed to secure very favourable conditions for New Zealand for at least the six or seven years' transitory period. But, as I have said before in your Lordships' House, others are far more qualified than I to speak about this. It is after that period to which we must continue to look. We cannot only look at the next six or seven years. I take the point—and it has been made to me and others by New Zealanders themselves—that New Zealand has been expanding her markets elsewhere in the Far East, the Middle East, and so on, and this is to be understood; but I believe that we are still under an important moral obligation to see to it that, after the seven years' transitory period, there is not a sudden ending of agreements of assistance if further assistance is needed. I hope and believe that the Government and the Community will honour that situation.

May I say one word about the Commonwealth as a whole. One school of thought is that we should abandon the Commonwealth; that our place is entirely in Europe, and that the Commonwealth does not matter. I do not take that view at all, although of course many of the emerging Commonwealth countries have sought new markets, as indeed have the old Commonwealth countries. Speaking certainly from a business point of view—and I speak as a small businessman as well as a Member of your Lordships' House—our place is quite clearly in the Community. But at the same time, I hope that the Government will give some categorical assurance that when issues arise which have a direct bearing on the Commonwealth, old and new, there will be full consultation with the countries concerned. It would be a very great pity for the Community, for this country, and for the Commonwealth as a whole, if this was not the case. This is something which would go a long way to reassure members of the Commonwealth as a whole.

May I turn for a moment to investment into the "grey areas", as they are called, in so far as it affects the European Economic Community. The other day a Statement was made in this House and in another place which has given, and which continues to give, rise to some disquiet. Many people, particularly in Scotland, are worried because there there is high unemployment, and there are still a number of grey areas. Putting a hypothetical case, suppose a firm wanted to set up a factory or an industrial area in the Central or Northern Highlands of Scotland, what would be the situation vis-à-vis the European Economic Community? Once we are in, would permission have to be sought from this body? This is a matter which is not entirely clear to many people in this country. I just give one example, which is probably not a good one, but there is a certain amount of concern at least about this particular matter.

THE MINISTER OF STATE, HOME OFFICE (VISCOUNT COLVILLE OF CULROSS)

My Lords, I wonder whether the noble Lord would clarify that matter so that we can answer him? Is he asking whether permission would have to be sought from Brussels before an individual factory could be set up in Scotland?

LORD AUCKLAND

My Lords, I was not thinking so much of an individual factory. I expressed myself rather vaguely. I was thinking more of a development area. Supposing one wanted to turn a particular area into a development area, would permission have to be sought? I am grateful to my noble friend for asking his question.

One or two other matters give rise to concern, particularly among the general public. After all, this is something which the general public want to know about. I turn particularly to the National Health Service. If a person, for example, once we are in the Community, had to have medical treatment in one of the countries within the E.E.C., would he be able to receive the same treatment as, say, a Belgian national does here when he has had an accident and is able to get at least part of the treatment on the National Health Service? This is something which is clearly worrying a number of people.

In conclusion, may I say this, my Lords? The real question here is the basic one that I was asked when I was over in New Zealand. A great many objections, or possible objections, were put to me, as indeed they have been put, I think, to everybody who has visited Commonwealth countries. But the basic question was: is it going to mean that New Zealand's trade with us suffers? Inevitably over the years there must be internationalism in trade. But I think the real question which everybody has to consider is: can we afford to stay out of the Community in the long term? I am not thinking of one year, five years, or of even ten years, because one must plan for the future. After being questioned for quite a long time by some of the New Zealand newspapers, I put this question to them, and they themselves admitted that this was something which had to be considered. It seems to me that this is what this whole matter is really about. One can find innumerable objections and reasons for concern about what could happen if things went wrong. But in the long term we are living in an age of internationalism, and I believe that our entry into Europe—I hope with not only an E.E.C. but a European Free Trade Area partnership, where I believe there are particularly great opportunities—will have an enormously favourable effect on this country in the future.

5.22 p.m.

LORD DIPLOCK

My Lords, to a lawyer—and I do not speak in any other capacity than as a lawyer—the true Second Reading debate upon this Bill took place last autumn, when the momentous decision was made to join the European Economic Communities. That decision having been made, the obligations which we thereby undertake under the Treaties make inevitable what we have to do to comply with them. The constitutional and legislative system of this country makes it inevitable how, within comparatively narrow limits, we have to do it, and this Bill does no more than give legal effect to that political decision. Before making a proposal which I wish to put for the consideration of this House, perhaps I may be forgiven if I try to spell out in simple language just what is involved, because the language of Parliamentary counsel, however brilliant, is not always such that he who runs may read.

The Treaties provide for two kinds of Community law, made by Community institutions upon which this country will in future be represented; and the problem with which we are faced does not arise out of Community laws which will have been made before this Bill was passed; it arises out of those which will be made in the future. My Lords, the Community law which takes direct effect is automatically as much a part of the law of the land as an Act of Parliament. Generally speaking, it is a regulation; and, so far as future laws are concerned, they will in general be regulations. But if I may answer a question put, not to me but to others, by my noble and learned friend Lord Stow Hill, there are certain provisions in the Treaty itself which have been held by the European Court to be directly applicable, and, exceptionally, a prohibitive provision in a directive may be held to be directly applicable. That is the kind of law which is directly applicable and which takes its own effect within this country, and it is generally made by a regulation.

The other way in which the Community makes laws is to prescribe the end to be achieved and to leave the choice of method to be decided by this country; and that is generally in the form of a directive. Both kinds, regulations and directives, vary enormously in impor- tance among themselves. All major regulations and directives are made by the Council of Ministers acting on a proposal of the Commission itself, generally made after consultation with the European Parliament or with a technical committee, or both; and what is vitally important for what I shall suggest to this House is that the committee's proposal is published when the draft of it is submitted to the Council for its consideration.

May I say a word or two more about regulations and directives, because of the effect which they will have upon our constitutional and Parliamentary practices? Regulations, as I say, take direct effect (they are dealt with by Clause 2 (1) of the Bill), and they may need no supporting legislation in this country. But in many cases it will be necessary, and in many more cases desirable, that, in addition to the regulation, there should be supporting legislation to provide for its implementation or enforcement, and to provide for the express repeal of Acts of Parliament. Because without that a regulation may impliedly repeal a provision in an Act of Parliament, and clearly it is desirable that that should not be left to implication but should be spelled out in the legislation of this country. Again, it may be necessary to supplement a regulation by amending provisions in Acts of Parliament which would be in conflict with the regulation but which could be amended to achieve the desired object by a method which would not so be in conflict.

Directives may sometimes be complied with by administrative action, but will generally call for legislation in this country—domestic legislation—to bring them into force. Sometimes, again to answer a question put by my noble and learned friend Lord Stow Hill, directives are drafted in such detail as to leave little choice as to the method. In effect, they say, "This is what you must put in your law", and it starts at Clause 1 and goes down to Clause 32. But some of them, and probably the most important of them, will allow the United Kingdom to select the method thus giving freedom of choice as to the most appropriate way to achieve the object prescribed; and the legislation to give effect to a directive may, as in the case of regulations, involve repeal or amendment of Acts of Parliament. The major instruments of both types are likely therefore, in many cases to require domestic legislation to enable us to carry out our obligations and our policy without conflicting with the Treaties.

My Lords, the Treaties do not say a word about how this legislation is to be made, either by the United Kingdom or by any other Member State. Theoretically, it could be done by Act of Parliament. In so far as it is, that requires no provision in this Bill; and none is there. But in practice the time limit within which both regulations and directives have to be given effect to under the Treaty makes it almost inevitable that in nearly every case the legislation here will have to take the form of delegated legislation. These are the matters, both supplementing regulations and bringing into effect directives, which are dealt with in subsections (2) and (4) of Clause 2 and in Schedule 2 to the Bill.

LORD SHEPHERD

My Lords, may I intervene to ask a question? If, as the noble and learned Lord says, there is this time limit for implementation in the case of a directive, and that therefore a Statutory Instrument or delegated legislation procedure is followed, it will preclude the House of Commons or the House of Lords from exercising any discretion on the implementation and carrying forward of the directive, even though the directive gives the Government discretion and latitude as to how they may proceed. Is that so?

LORD DIPLOCK

My Lords, the noble Lord has asked a question which the remainder of what I am about to say will, I hope, answer; because it is the very point that I am on. It is true that at the delegated legislation stage, the stage when the Statutory Instrument is laid before Parliament, there is very little that Parliament can do about it in either House. There is no power to amend, and very little real power in the circumstances to reject: because unless the Instrument is replaced, rejection is likely to lead to a breach of our Treaty obligations.

But the matter that I wish to urge upon this House—and this is the sole purpose of my speaking here this evening ; and I say, "to urge upon this House" and not "upon the Government" because this requires no Amendment to the Bill and it transcends all Party considerations—is a matter which raises the important question of the role of Parliament in legislation. I urge upon this House as a matter of the utmost urgency that we should take steps to examine the problem of Parliamentary scrutiny and debate of major Community Instruments at the drafting stage. That was why I drew attention to the importance of the fact that at the moment the Commission submits its proposal to the Council, the proposal is published in a form which all of us can see and is available to us—

LORD SHEPHERD

My Lords, may I intervene once again? This is a most important point. Would the noble and learned Lord then support the position which I believe is to be found in the Dutch legislative provisions: that there are statutory requirements for this scrutiny to be performed by Parliament prior to draft legislation being placed before the Council of Ministers?

LORD DIPLOCK

My Lords, although I know a little, but very little, about what happens in Holland, the Dutch Constitution is not one on which I feel competent to answer questions. The point I wish to make is this. The scrutiny and debate which are required are required not for one purpose but for two purposes. The first is to consider the draft Community Instrument itself, so that the Minister or the representative of this country on the Council will be informed of what Parliament thinks. The second, and equally important, purpose is to provide an opportunity, if the Community Instrument is made, of considering what domestic legislation is proposed either to give effect to (in the case of a directive) or to supplement (in the case of a regulation), for it is at that stage that there may be a choice as to which is the most appropriate method—to supplement or amend an Act of Parliament or the like. That also enables the Government to be informed of the views of Parliament as to what should be the content of what may be most important delegated legislation made by Statutory Instrument in this country itself. It is essential that that scrutiny and that debate should take place at that stage, because once the Community Instrument has been made by the Council there is no effective power in Parliament to amend Statutory Instru- ments designed to give it effect, even if such amendment could be made without conflict with Community law.

My Lords, this House and the other House will be confronted on January 1 next with a new problem to which we must find new solutions. I do not doubt that this problem, given good will, can be solved. What I do urge is that urgent consideration is needed before January 1 by, I would suggest, a Committee on which I should hope that Members of both Houses would be represented. Whether you call it an ad hoc Committee or something else, does not matter. But there the problem is. It is urgent. It is new. It may be solved if only Members of both Houses will give their minds to it, and their good will.

5.41 p.m.

LORD REAY

My Lords, the Second Reading of the European Communities Bill offers those of us who support it—a vast majority in your Lordships' House —an opportunity to confront, for the last time in a major debate, the arguments of our opponents. More importantly, it gives us a chance to include some remarks on the development of Europe, as we desire or foresee it, in the somewhat cooler national atmosphere that prevails in the aftermath of the debate's climax. In this debate to-day, so far as the conflict between opponents is concerned, I think that there has been much forbearance. This is in accordance with the traditions of your Lordships' House, and I note with satisfaction that no opponent of entry has yet forecast the collapse of this tradition when we enter the Community and become subject to alien influences. I shall most certainly attempt to conform to it myself.

It seems to me that in the most recent debate on this subject, in another place and also to-day in your Lordships' House, opposition has concentrated on the question Of sovereignty, on the area which includes what the noble Lord, Lord Greenwood of Rossendale, described as being the constitutional concept of the Queen in Parliament. While this follows naturally from the fact that we are now concerned with the implementation of legislation which had and will have its source outside this country, it is true, I think, that it also shows the opponents to entry in their best and frankest light. For I have long believed that the one basic source of all objections to our entry into Europe was the dislike of losing what it has meant in the past to be British.

Vivid illustrations have been provided by opponents—not so much in this House; there are not so many opponents in this House—of how matters will be conducted in the future in a manner expected to outrage the traditional British citizen. "Look at the Germans", we have been told. "Can you believe their audacity? They are trying to tell us what our regional policy should be; and we are not even in the Community yet. Can you imagine what it will be like when we are in? " Well, of course, if the Germans thought that we might be introducing a regional policy on the eve of entering the Common Market which threatened to distort competition in a manner conflicting with, 1 think it is, Article 92 of the Treaty of Rome, it was quite proper for them to draw the attention of the Commission to their misgivings. To some of us this recent occurrence is quite an acceptable foretaste of what will become a common sort of experience. But to those who oppose this Bill, I believe, nothing is really more important than that we should preserve exactly the forms and institutions and the ways of conducting business that we have, simply and solely because these forms and institutions and these ways of conducting our business are those that have always existed in the past. I believe that such an approach, though not unattractive, is out of date.

And I think it is out of date for two principal reasons. The first is that we are leaving the era of nationalism. It no longer makes sense for nations to attempt to revive their own nationalism. Nothing can any longer be built on nationalism—with rare exceptions where nationhood itself means survival. Both ourselves and the French—although not the Germans—have tried since the last war to revive nationalism, but the results have been disappointing. It is not nations we must think in terms of any more, but continents. And if it was objected that this view would not be shared by the majority of the people in this country, I would answer that it most certainly will be. You have only to pay attention for one moment to the opinions and activities of the young to-clay to understand that nationalism does not, and will not, play any part in the psychology of the future generation.

The second reason why I think it is out of date to want an independent Britain before anything else, has to do with the scale of modern problems. An increasing number of the most important problems which this country will have to face are not British problems at all. They are either problems which derive from a combination of a high level of industrialisation, a small amount of space and a valuable cultural heritage —in other words, the problems of Europe —or they are problems which industrialised countries together need to face from outside; for example, the availability of natural resources. Or they are problems like population or pollution which are principally global problems. These problems are highly political; that is to say, there are going to be emotional obstacles in all countries within the Western tradition to the sort of changes of approach that their solution is going to require. In other words, both defensively, in order to maintain the highest standard of life that we can in Europe, and also aggressively, in order to provide some leadership in the solution of the problems of survival in the world, Europe is united by her problems, and united politically.

My Lords, if Europe develops the characteristics of a bloc she is only responding to the facts of the world. In the United Nations we are already used to the determination of developing countries to establish political combinations. The developing countries will definitely combine in the future to demand a better price for the advantage they hold in possessing many of the raw materials on which we depend for our industrial output. Similarly, the development of a United Europe is the only realistic response to that great continental bloc to the East—Russia and her satellites. Europe has simply no means, until she is politically united, of entering as an equal into a relationship with Russia. For the first time in my lifetime European countries have the prospect of entering into a relationship with Russia without either looking likely to become the victim or looking ridiculous.

There has been in recent debates considerable discussion about European institutions, as indeed there has been in the past; but it has recently risen more regularly above the level of sarcastic references to the bureaucracy in Brussels. We have been given the impression that Her Majesty's Government consider the development of European institutions less important now than co-operation on specific problems. I hope that impression is correct. Institutions have no value beyond their capacity to solve or to permit the solution of the major problems of the age. In a situation where power needs to be built up in a vacuum, which is the situation which we are in, it is plainly correct that the institutionalisation of that power, the establishment of its accountability and so forth, should follow the patterns of co-operation which are found to be satisfactory. Moreover, we should do well to have a clearer idea of how severe and prolonged the crisis for Western societies is likely to be. For situations of crisis require, and have always been recognised by us to require, a concentration of authority which in less threatening periods is less acceptable. When the day comes to decide these questions—what form to give a possible Executive; what relationship it should have to the Legislature, how frequently it should submit itself to elections—we shall of course also find that in Europe there will be many different ideas with regard to the most desirable form and degree of democracy to introduce.

My Lords, it seems likely that with our accession Europe will develop at a far faster speed than it has done in the past. For the last decade Europe has been immobilised by the opposing momentums which France and Germany have wished to give to her development. Simply by entering Europe we shall upset that balance of forces, and it is plain that we are not entering Europe in order to stand still. Indeed, I think that in this country there is a striking failure to appreciate the import of the movement towards monetary union in which we are already taking an enthusiastic part. Monetary union means the co-ordination, even the integration, of economic policies; without it it is hollow. But the consequences of economic co-operation are profoundly political. The signs are that we are on the eve of a period of activity which will carry us a startling distance from the position we occupy to-day.

I do not think we shall regret the decision that has set us on this journey. Although the people of this country may be apprehensive about its consequences, particularly the economic consequences, I think it is accepted by them as a legitimate decision, taken legitimately in the traditional manner by Parliament, and acceptable to them as final. It may be regrettable for some. De Gaulle once said publicly, as he prepared the French people for the abandonment of Algeria, that it was natural to feel nostalgia for what had been an empire just as one could regret the gentleness of oil lamps, the splendour of ships of sail and the charm of the days of the horse and carriage. But for most of us the problems of the future are too pressing to spend long in regret for a position of national power that is irrecoverable.

5.52 p.m.

LORD BROCKWAY

My Lords, my noble friend Lord Greenwood of Rossendale remarked on the fact that this Bill, which could profoundly affect our future, should have passed through another place without any amendment. I think the discussion which has already taken place here indicates a very deep desire by Members who take different points of view that the House of Lords in the Committee stage should consider whether some emendation of this Bill is necessary. That was shown most particularly in the recent speeches of my noble friend Lord Stow Hill, and the noble and learned Lord, Lord Diplock. I recollect recent Bills which have come to this House from another place—the Commonwealth Immigrants Bill, the Industrial Relations Bill and other legislation—where the knowledge and expertise of Members of this House have contributed immensely to the improvement of those Bills. Therefore, I hope that, before this Bill goes through, this House may have the opportunity to make Amendments which have been so clearly indicated in the speeches that have already been delivered.

I do not propose to discuss the pragmatic consequences of this Bill. That can be done in some detail during the Committee stage. I propose to ask your Lordships to consider certain prin- ciples which will be acceptable only to a few of your Lordships but which are deeply held by some of us and which we regard as fundamental. I think we must begin by recognising that whatever our views of this Bill may be we are all Europeans. The whole of history has determined that fact—ever since the Roman invasion of this country, the period of the Holy Roman Empire, the Anglo-Saxon invasion of this country, the Norman occupation, our involvement in the Hundred Years War and the war with Spain, the Two World Wars—inevitably all of us historically are deeply involved in Europe. Perhaps more importantly, because physical facts can be outlived, we are also identified with Europe in culture. The cultures of Greece, of Rome, of Christianity, of the Renaissance, of the Reformation, of the Liberal philsophers, of Karl Marx, of Bertrand Russell—these have all affected our thinking and our values very deeply indeed.

Whilst we have this close association with Europe I think we should recognise that in our history and culture, we have wider associations as well—the history of the Empire, of Ireland, of India, of the 13 Colonies which became the United States of America, the Dominions, the occupation of Africa, the conversion of the Empire into the Commonwealth—and the fact that to-day we are living in a small world of which Europe is only a part. Apart from those historical facts, we are now beginning to realise as we never have before that other parts of the world have contributed to the cultures of all mankind. Perhaps that is true particularly of the East. I want to say, perhaps because I was born in the East, that I have more sympathy with the attitudes and values of the East and with their religions than I have with the religions and materialism of the West. Their culture is going to make a contribution as well. But, my Lords, having said that, I should add that our association with Europe, both historically and culturally, is the closest, involving all of us.

In my reference to the cultural contributions of Europe, I mentioned Karl Marx. I do not think any of these cultures or religions have contributed the whole truth or the whole beauty. Certainly, I do not think Karl Marx did so, but I believe he laid down one pro- found truth—that it is the economic system in society at any particular time which determines its social, cultural and political character. The difference between many of us and Karl Marx is that we believe changes must take place by democratic means and with a great emphasis on personal freedoms and liberties. But the combination of a belief in Europeanism and a belief in Socialism means that one stands not only for the conception of European unity, but equally, if it be true that the economic basis of society decides what its social, cultural and political character is to be, for socialism. It was that combination of a belief in European unity and a belief in Socialism which led me, thirty years ago, to become one of the founders of the movement for the establishment of a United Socialist States of Europe. That movement developed to the point where it ceased to be a movement for European Socialism, and became a movement for European union. I believe that a profound mistake was made when the conception of a Socialist Europe was sacrificed for the conception of a European political union irrespective of Socialism.

One has to recognise the fact that, to-day, Western Europe is dominated by great multi-national capitalist organisations which are more powerful than even the Governments of Europe. Look, my Lords, at the hopelessness of our political Governments in our present economic system. Governments have tried to cure unemployment but they cannot; they have made efforts to cure inflation but they cannot; neither can they solve the problems of poverty or ill-housing. That is because the economic system in our country and in Europe is now more powerful than our political administration. If you come to that conclusion, you must come to this conclusion as well: Yes, we are Europeans but a Western Europe within a capitalist system with vast multi-national economic organisations, dominating Governments and determining our lives, will become a reactionary contribution to Europe and to the world.

I know we meet the argument that the Social Democratic Parties and the trade unions of Europe want us to go into Europe so that we may co-operate with them for a Socialist purpose. I want common action among the trade unions; there must be co-operation if they are to meet the new multi-national organisations. I want co-operation among the Social Democratic Parties, bat the realistic fact is that not even the social democratic parties are yet prepared to challenge capitalism or the new form of multinational capitalism that one has in Europe. It will come. The new programme adopted by the Labour Party for this country is some indication that it is beginning. What is happening in France and in Italy are indications that it is beginning. But for those of us who are Socialists, the moment to decide for entering the European Community is when the social democratic parties decide to make the challenge to multi-national capitalism and when those parties are in such a position that we can hope they will become Governments and be able to change the character of Western Europe.

I recognise at once that that argument is not likely to receive the support of a majority in this House. It seems to me to be a fundamental argument for those who are Socialists, and it is for that reason that many of us will oppose Western European Union while that union remains a capitalist union, a rich men's club which will exploit the workers of Europe and of the Third World. Only when we see the opportunity for the decisive change shall we be in favour of entering a Europe which has a Socialist purpose.

6.8 p.m.

LORD GORE-BOOTH

My Lords, the noble Lord, Lord Brockway, will not expect me to go into a complete dialectic with him. But perhaps I may just start by saying that I speak as an humble citizen who is trying to see whether we cannot sort out, in a way which is favourable to a free society, the conflict between the mixed economy and economic totalitarianism. That is the humane view of very many people, including the many non-materialistic people to whom the West has so often given birth.

May I now go back to the first sentence of the speech made by the noble and learned Lord the Lord Chancellor. He referred back to 1950. Here we are nearly at the end of a pilgrimage which began in that year. I think in that year we had no concept of what a pilgrimage it was going to be. It is perhaps just worthwhile recalling that at that time we were sitting happily at the centre of a three-circles policy. We had three centres to our external policy—the Commonwealth, our special relationship with the United States, inherited from the war, and our relationship with Europe. The history of the last 20 years is to my mind a history of how those circles evolved.

First, the Commonwealth, to which there has been much reference to-day. The Commonwealth was a good centre in its time, and for 10 years after 1950 so it remained. Then there was a further explosion of countries into independence, and since that time the Commonwealth has retained great value and not just sentimental value, but it cannot be said to be the mainspring of policy in Commonwealth countries. I say that as one who has served in Commonwealth countries. Not only that, but our second circle, the American circle, has finally changed. Even in the 'sixties we were able to retain certain options in foreign policy—options vis-à-vis Europe, in particular—because we were sure that, if we were in great economic difficulty, the resources of the United States would to some degree be at our disposal. Now the American mood and the American economy have changed. Now is the time when we really do have to make up our mind what the future British role will be.

So we come to these years in which the British, who are a restless people, want to go somewhere. They are restless; they always have been. They want to get out of their small island; they mostly want to come back again, but in the meantime they want to do something elsewhere. So we come to this moment—and it is curious to reflect that it might have come 10 years ago, it might have come five years ago, but now it has come—when we have very nearly made up our minds as a Parliament what that role should be. We find ourselves here confronted with this Bill, and on that let me only allow myself to say that I found extremely convincing the exposé by the noble and learned Lord on the Woolsack of why the Bill is in the form that it is, and that it could hardly be in any other form. What I have tried to do for the purposes of this debate is to conduct a private sample survey of the two million words uttered in another place. My methods were entirely confidential. I have come up with what I think to be the three issues which primarily concerned most Members of the other place, and to which the debates constantly returned, namely, finance, regions and sovereignty. I should like to refer briefly to each of them, and then to come on to two or three points about whether to join or not to join.

On finance, it is strange to think that two years ago we were all trembling in our shoes about that famous paragraph 101 of the 1970 White Paper which told us that the cost of the Community to our balance of payments in a year might mean anything from £100 million to £1,100 million. It is curious that this should not have come up in this debate; perhaps it is because we have grown up somewhat in our economic thinking. I think the answer to the apprehensions on that point was neatly stated by Mr. Harold Lever in another place. Mr. Lever simply pointed out that if a situation tending towards £1,100 million began to develop, then it would not happen; and it would not happen because our partners would not allow it to happen, since what we have learned in recent years is that the inflow of these vast amounts of money can be just as destructive to an economy as the outflow. Therefore, the apprehensions that we had in 1970 can, I think, quite simply and yet not superficially, be countered by the thought that the moment that something like this began to occur our partners in the Community would join with us in preventing that tendency, even if it meant amendment of the sacred agricultural policy.

Then, if I may come on to the regions, here again I think we have tended to forget something important in the past. It may only be a general text, but it is perhaps not without significance that the fifth paragraph of the whole of the Treaty of Rome—it comes on page 1, and before a lot of signatures—sets out first of all the designs of the Treaty of Rome and describes the partners as anxious to strengthen the unity of their economies and to ensure their harmonious development by reducing the differences between the regions and the backwardness of the less favoured regions. It is one of the primary objectives of the Community to do precisely that. While I have no doubt that our partners have the right to question individual regional policies by us, and we have every right to question development policies by them, none the less this remains a primary objective of the Community, which our own representatives when they get there should never forget to quote when they are under pressure.

Then, on sovereignty, I hesitate to say anything, because I am so surrounded both in space and time by noble and learned Lords. I should like to put in at this point an expression of how much I was impressed by the intervention of the noble and learned Lord, Lord Diplock. I think he drew attention to a most important point. It is extremely important that Parliament should devise some method of looking at what is emerging out of the Community, and there are two points which perhaps I could add to Lord Diplock's very learned analysis. The first is that our own delegates at Brussels will be of great help in keeping Parliament informed; and, secondly, it will require great wisdom to develop a system of handling such matters in a Parliamentary manner without falling into the opposite difficulty which has been so much a feature of the conduct of external policy in the United States, where often a misguided initiative by the Senate could lead to extreme confusion. But this does not invalidate in any way the great importance of the noble and learned Lord's suggestion.

On sovereignty, I have some sympathy with the noble and learned Lord, Lord Stow Hill, and I should just like to express the hope that the Government will give us a little further exposition on the matter of sovereignty. I would add to the request to them to do so by sticking my neck out totally as a layman and saying something which is probably entirely wrong. It seems to me as a layman that there are two kinds of sovereignty. There is the doctrinal sovereignty, which has been much referred to—the Queen in Parliament who can do anything. Then there is the popular notion of sovereignty as the exercise of power.

Speaking as one who has for many years been a strong pro-Marketeer, I feel sometimes that those of us who are of that opinion tend to over-simplify and exaggerate the maintenance and extension of sovereignty. If I may put it in a brief expression, I should have thought that what will really happen, if and when we join the Community, is that we shall exercise rather less sovereignty over a great many more people. I merely express that idea to your Lordships as a layman, not intending to be an expert, but hoping to hear some explanation on this difficult subject.

Now if I may say a word on the opposition to what we are doing, I do think—and as I listened to the noble Lord, Lord Greenwood of Rossendale, I thought again—that as a country we still think a little too much, although the noble Lord spoke with the greatest skill, in terms of "what are they going to do to us?" If one were mean-minded one could say "It is also a question of what are we going to do to them". But we have now emerged from the dead waiting rooms of power into the corridors of power, and we are now shortly to be in the council chamber of power; and when we are there I do not think we are ever going to be alone.

I think that in all the arguments that go on we may find ourselves with the French and against the Germans or the Dutch, or with the Dutch against the Italians—not "against", but arguing as partners. And I think that from January 1, 1973, we must get out of the habit of thinking of Europeans as foreigners in the old sense. They will still talk strange languages and behave in odd ways, but they will be essentially partners and we must change our attitude on that point.

Then there is the question of re-negotiation. Of course it is not any of my business why anybody should suggest this as a policy. But in all seriousness I suggest to your Lordships that when one has signed an instrument of accession and if and when we have passed this legislation, it would hardly be correct to have a proposal to pull out, to make up some new rules of our own and then to come back again and say "Will this do?" I can see how the idea arises, but from my professional experience I can honestly say that such a procedure would be extremely damaging to our international credibility.

There is one other point to which I should also like to refer and it is a very delicate one. In our country at the moment, where for many reasons we are not very content with ourselves, there are all sorts of ideas and elements of thought going around; and one is very destructive. There is a sort of instinctive destruction which you run into in many places. I am not going to pin it on people or on any group. The thought can be called "anarchy", but it can also be called "destructiveness", "decomposition", or whatever you like. I would just suggest to anyone who is havering about this question that there is some importance attaching to who your allies are, and all the destructive thought concentrates in the direction of opposing our entry into the Common Market and becoming a Member of the European Community. Do not let me be misunderstood by anybody: I am not saying that people who are against our entry are affected by the spirit—not at all. There are many who have good and serious reasons for opposing our entry. But I do again emphasise that there is this destructive element, and it is always to be found opposing what we are now trying to do.

Let me turn finally to the more cheerful aspects of what is proposed. In my sample survey the other common note I found everywhere was that the spirit of trying to undertake what we are now doing is essentially a spirit of adventure. That is its great appeal, I think, to many of us, including the noble Lord, Lord Reay, who was I thought most eloquent. I have said this many times and I will not weary your Lordships with my views again. I therefore sought an unlikely source in support of this view. If I had been looking for a pro-Marketeer I would not necessarily have looked up the writings of Professor Sir Arnold Toynbee. This very great man, learned in the perspective of world history, might have felt this was rather too small a matter for the kind of historical analysis which he develops. But after considering the British past he wrote recently in an article in the Observer the following words. He speaks of the cause of British successes and he says that one cause— is the British people's readiness to cut their losses and to find consolation in embarking on new ventures, instead of sitting back and brooding over what is irretrievable …To-day after having lost her ephemeral overseas empire, Britain is entering the European Economic Community …If they (the British) behave once more in their characteristically sensible and constructive way, they have a promising prospect for a new chapter of history—this time in Britain's natural European setting, but now also in the wider setting of the whole world". Those are Professor Toynbee's views, and I find them most impressive, given the great world perspective in which he deals. The only thing which perhaps he has left out is what do we need to do as well as being sensible? The answer to that, curiously enough, may be found, I think, in the prayer of the Order to which I have the honour to belong. At the end of an annual service we pray to be endowed with "wisdom and patience, courage, serenity and strength". I am quite sure it is going to involve all of those qualities, and more besides. But if we can demonstrate these qualities, I am sure we shall make a great contribution to the future prosperity and happiness not only of Europe but of the whole world.

6.27 p.m.

LORD CHALFONT

My Lords, it is, as always, a very great pleasure to follow a speech so passionate and at the same time so constructive as that of the noble Lord, Lord Gore-Booth. I wish that it were possible to say also what a very great pleasure it is to take part in a great historic debate which fills your Lordships' House to overflowing and which will be reported at great length in all the great organs of the Press tomorrow morning. But, of course, it has not filled your Lordships' House to overflowing, and I need hardly remind you that it will not fill the columns of the Press to-morrow morning. The European debate has in fact—this is a painful thing to say but I feel it is true—become, I believe, through a narrowness of vision and a paralysis of imagination in large parts of this country a cosmic bore. Its claim to the title of "Bore of the Decade" is contested only by, I think, George Best and the great chess match now taking place in Reykjavik. It is for that reason that I shall not speak at very great length. My views, like those of most Members of your Lordships' House, are well known on this subject. I have heard nothing new said on the subject to-day; I shall have nothing new to say about it; and I dare wager that after I have sat down nothing new will be said during the rest of this debate. However, I think it right briefly to place on record the views of at least one who is in favour of giving this Bill a Second Reading.

My noble friend Lord Greenwood of Rossendale, in the course of what was, if he will allow me to say so, one of the ablest speeches I have heard on this or indeed any other subject in your Lordships' House, said that we on this side of the House would not vote against the Second Reading. I will, with his permission, go even further and say that for my part I shall vote for the Second Reading. The terms of this Treaty of Accession, as we know, are not perfect. This has been said before. It has also been said—and I will say again—that I believe they are the best that were available in the course of the long, detailed and tough negotiations. I also believe, as clearly does the noble Lord, Lord Gore-Booth, that to talk of renegotiating this Treaty of Accession is a will-o'-the-wisp. No such renegotiation is available; and I believe that, whatever may have been our wishes on this side to improve the situation inside the Common Market, it has been made perfectly clear from our partners and colleagues in Europe that renegotiation of the Treaty of Accession is simply not an available option.

This is not however to say that we cannot, once inside the Common Market, help to change the situation that exists there. No one, not even the most passionate pro-European or Common Marketeer, would pretend that we cannot improve the situation inside the enlarged Community—of course we can. We must for a start ensure that the Community has a coherent and constructive regional policy. The noble Lord, Lord Gore-Booth, has pointed out that in the preamble to the Treaty of Rome it is made clear that this is one of the aims of the Common Market. I shall return to this very briefly when I deal with what I believe are two fundamental misconceptions and misinterpretations about the Treaty.

We can improve, and indeed we must improve and change fundamentally, the Community's agricultural policy. We must be at the root of providing some of the dynamism for new developments inside the Community. We must be prepared to talk about the evolution of a directly elected European Parliament with powers to overcome the dangers which the noble Lord, Lord Brockway, outlined: the pervasive and creeping power of the multi-national corporation. But it is no good wringing our hands about multinational corporations; we must develop the democratic organs and institutions inside Europe to deal with them and control them. We must be in the leadership of the reform of the institutions inside the Community; we must insist that the Council of Ministers and the Commission become collective, policy-making bodies and not the representatives of individual countries. For that reason we must insist upon the gradual implementation in the Council of Ministers of majority voting which is provided for in the Treaty of Rome. We must be the experts, and possibly the leaders, in the field of monetary integration, political integration, defence integration and all the other ways in which this great, new Europe is going to be fashioned when we are members I of it.

But this is for the future. I believe that this should now be the preoccupation of the great political minds of this country: not preoccupation with legal difficulties, with pitfalls which, in many cases, do not even exist—they have simply been imagined—but with what we are going to do when we are inside this great Community and what we are going to do to turn it from a Community of the Six which has progressed to some extent, but not in any perfect way, since it was formed into the great vision of a united Europe looking out towards solving some of the great problems with which we and the rest of civilisation will be faced at the end of this century and the beginning of the next one. That is what we should be concerned with now. I hope that many able, analytical intellects in this country will concern themselves with this, rather than with sterile and arid arguments about how we can prevent this great development happening or, if it happens, how we can withdraw from it in certain circumstances which to me are not entirely clear.

My Lords, I should like this evening to concentrate on two matters concerning the Treaty of Accession and the Treaty of Rome which I believe to have been widely misunderstood and, in many cases, wilfully misrepresented. First, I should like to deal with the question of regional policy. I need hardly refer to the preamble to the Treaty of Rome—the noble Lord, Lord Gore-Booth, has already quoted from it. I will simply point out that it is among the aims of the Treaty of Rome to reduce and eliminate the differences that exist between different regions. I go further than that and refer to Article 92 of the Treaty of Rome, which is the substantive Article. I shall ask the indulgence of the House if I simply refer to the facts as they are laid out in the Treaty, because in many cases, very often in public debate, this has been wilfully and disgracefully misrepresented.

At the beginning of Article 92 it says: …any aid granted by a member State or through State resources in any form whatsoever which distorts or threatens to distort competition.…shall…be incompatible with the Common Market. I am not quoting in extenso, but I am quoting the actual words of the first paragraph of Article 92. Those words are preceded by the following very important words: Save in the case of exceptions specified in this Treaty… A few lines lower down it says: The following shall be considered to be compatible with the Common Market: (a) aid intended to promote the economic development of regions where the standard of living is abnormally low or where there is serious under-employment; I apologise to your Lordships for quoting from this document, but it seems necessary to place on record that it is one of the aims of the Community to abolish regional discrimination, and that it has specifically provided in one of its substantive Articles that development aid to regions where there is unemployment, or where the standard of living is low, is not incompatible with the Treaty of Rome. It is not against the principles or the practice of the Common Market. It is essential to make that point, in view of some of the loose and deliberately misleading statements that have been made on this subject in public debate.

To me, even more depressing and distressing is the way in which there has been an attempt to mislead the public on another matter: the possibility that the Common Market might engage in some form of discrimination against certain United Kingdom nationals when we join it. It has been suggested that because of a reservation in the Treaty of Accession it may be open to the countries of the Common Market to exercise discrimination against certain people in this country because of their colour or their race. I think it is wise not to engage in that kind of polemics, but simply to place the facts on record. And Article 7 of the Treaty of Rome says: Within the field of application of this Treaty, and without prejudice to any special provisions contained therein, any discrimination on the grounds of nationality shall be prohibited. That is the general statement early in the Treaty. Although I will not weary the House with a long quotation from the next part of the Treaty to which I shall refer, anybody engaging in public debate about the Common Market and the Treaty of Rome should be required first to read—and perhaps even to write out a thousand times—the provisions of Articles 48 to 58. I will mention only the first paragraph of Article 48: Freedom of movement for workers shall be secured within the Community not later than by the end of the transitional period. I could go on quoting from these Articles, but it is unnecessary to do so because it is enough to say that the aim of the Treaty of Rome, and the provisions in it, are clearly designed to provide for freedom of movement of workers of the nationals of the countries that belong to the Common Market, irrespective of their colour, creed, religion or any other peculiarity that they may have. The Treaty of Rome is specific not only on the rights of the freedom of workers, but in the right of establishment for self-employed persons; for example, the right of doctors to practise inside the Common Market in any country of the Community without let or hindrance. We have been told that the Common Market countries have entered a reservation to this in the joint declaration which they made when the Treaty of Accession was signed between the Common Market and the applicant countries. Here again it should be a requirement of those engaging in public debate to quote this in full and not in a selective and misleading way. It says simply that the enlargement of the Community could give rise to certain difficulties regarding the application of the provisions relating to the free movement of workers. But it goes on to say that the Member States reserve the right to bring the matter before the institutions of the Community in order to obtain a solution of this problem. That is all that it says. They have the right to bring the matter before the institutions of the Community.

As I need hardly remind noble Lords, the institutions of the Community include the Commission and the Council of Ministers. On the Council of Ministers, this country will be represented by its Foreign Minister, sometimes by its Prime Minister or some other Cabinet Minister, depending on the subjects being discussed. If there should be any attempt on the part of any of the member countries to bring this matter before the Council of Ministers, the representative of this country would have a vote on the Council of Ministers; on a matter of this importance which would affect the legislation of this country it is almost certain that he would have a veto.

I ask your Lordships, therefore, not to be misled by those who suggest that the countries of the Common Market, when we join them, shall have some right, even if they have the inclination, to exercise discrimination against any national of this country on the grounds of his race or the colour of the skin. This was an abominable suggestion designed mainly to arouse the worst fears, preoccupations and suspicions of a certain section of our community. I believe this to have been a disgraceful piece of propaganda. I hope that reference to the facts will dismiss it from the consideration of intelligent people, once and for all. As the noble Lord, Lord Gore-Booth, has said, this is simply a reflection of a curious attitude which we still have towards entry into the Common Market and the process of becoming members of a great European Community.

We argue about whether Parliament will have the right to debate this or that issue before it comes before the Council of Ministers, and about what they will do to our coloured population and to our regional policies. We argue as though we were engaging in a confrontation with enemies instead of in a great project of partnership with friends. These countries are not out to do us down. They, like us, are entering on a great adventure of European economic and political cooperation. We seem to assume an evil intent in everything that we have to do with foreigners, and nowadays the worst kind of foreigners seem to be those who have been unwise enough or, in the minds of some people, devious enough to sign the Treaty of Rome.

We have enough problems in the creation of a great European Community without inventing new ones or exaggerating those that already exist. We have the basic problem and task of ensuring that the Europe to which we already belong, and have always belonged but are about to belong in a more formal and institutional sense, will play a memorable and worthy part in the affairs of the world, in the great problems of peace and war and in how they are to be solved, in the problems of disarmament, of the arms trade, of the environment and of the intelligent allocation of the material and scientific and human resources of the world, so that the world is not divided, on the one hand, into the poor and starving, and the fat and rich on the other.

We have the task of making sure that we are members of a Europe which looks out to solve those problems. That is what we should be addressing our minds to now, and not to tittling questions of the legality of this or that clause of the Treaty of Accession. I for one shall certainly not seek to amend this legislation. We are already causing enough doubts in Europe about our conviction and commitment to the European cause, and about our determination to engage in a constructive and meaningful partnership. Now is the time to raise our eyes from matters of detail and legality, to stop taking counsel of our fears, and to grasp this great opportunity which is being offered to us possibly for the last time.

6.45 p.m.

VISCOUNT MASSEREENE AND FERRARD

My Lords, I enjoyed very much the speech of the noble Lord. Lord Chalfont. I was so glad to hear him read extracts from the Treaty of Rome. My experience has been that very few people appear to have read it. I have gone through it several times. I think I understand most of it; some of it is not easy to comprehend. I should like to apologise to the noble and learned Lord the Lord Chancellor for not being here when he spoke. Unfortunately I had a slight mishap on the way here. I shall not go into it: it was not serious but it rather delayed me.

This Bill is commendably short and therefore my remarks will be short. Surely all the Bill is doing is putting into legal language what both Houses of Parliament have already agreed to. Therefore, I do not see why we should have a lot of talk about it. I join the noble Lord, Lord Chalfont, in congratulating the noble Lord, Lord Greenwood of Rossendale, on his excellent speech. Though I did not agree with all the things he said his speech was well delivered and of a high standard. While the Bill is commendably short one could not say that it is commendably simple. One of the reasons why people are anti-Common Market is that they fear it. They do not understand it. Thank heavens the average member of the public does not read Parliamentary Bills. If they read this Bill it would frighten them more. For instance, I have tried to understand Clause 2(4). We talk about clauses in Bills being a paradise for lawyers but I should think that this one would be a nightmare for them. I cannot understand it but I do not consider myself intelligent regarding legal drafting.

We have heard quite a lot about sovereignty. The people who are worrying about this are being unnecessarily pessimistic. As I think the noble Viscount, Lord Watkinson, said, through belonging to NATO we have to deprive ourselves of more sovereignty than would be the case in regard to the European Economic Community. As I see it, the Community acts only through the British Parliament on some matters affecting the United Kingdom. Community law can only derive its authority for us through our Parliament. That is surely the technical and legal explanation. If it gives those noble Lords who are against going into the Common Market any comfort surely under our Constitution no Parliament could bind a future Parliament not to change the law. We have heard a lot about re-negotiation. I personally think it would be disastrous. Our prestige would fall to an all-time low, but as I said, no Government can bind another Government not to change the law. Regarding sovereignty, presumably we could get out of the Common Market if we wanted to do so. It would be absolute madness, but countries have broken Treaties before. It would be deplorable but it could be done.

There is only one aspect of the Bill about which I am rather nervous. The noble and learned Lord, Lord Diplock, brought it up. It is the question of delegated legislation or subordinate legislation emanating from the Community. I intended to raise this point in my speech, but Lord Diplock brought the point home very forcefully. I hope that before these directives come to the British Parliament we may be given some means of discussing them in draft. I am not here referring to both Houses of Parliament, but to some high-powered Committee. It is no use waiting until a directive comes here: we have no power to alter it. We must surely see the draft. This is extremely important. Perhaps the noble and learned Lord the Lord Chancellor explained the procedure in his speech; if so, I must be excused for mentioning it.

I quite agree that to some people going into the Common Market is a fearsome leap in the dark. It is not fearsome to me, but I can understand its being so to some people. But one must have faith in these matters. Some of us read the economists. I have read reams and reams of figures, and the economists do not appear to agree. I discard their figures because I do not believe that any economist is able to tell us exactly what the position will be when we are in the Community. Therefore, I think they would be better employed keeping quiet, or at any rate quieter. I have a great sympathy with those people who are afraid that when we join the Community a part of our national life will go. I have thought a long time about this. In slightly over half a century I have seen part of our national life go; indeed, I have seen a lot of it go. I have seen ridiculed things I was brought up to revere. We cannot stay still, because if we do we should only decay. We must go into this great adventure.

Look what we have seen in the sphere of technology and in changes in the communications media! Countries are now brought to within a second of each other; the English Channel is only a ditch, no longer a barrier. People are inclined to forget that we come from Europe and the Continent, that our origin is in Europe; we have sprung from would also point out (perhaps this is a slight note of discordance, but I do not think so) that the white Commonwealth also springs from Europe. Therefore I would have wished to see rather better treatment of our old Dominions. I am not worrying about Canada because she is so much within the economic orbit of America. But I feel that Australia has not had a very good deal. I would have hoped that our negotiations with Australia over the E.E.C. might have been more helpful to her. I would also hope that, when we are fully established in the Community, we will use our influence—we shall have great influence; far more than we have now—with regard to New Zealand so that, if she needs it, we keep open a lane for her exports. When one considers that the E.E.C. will embrace 300 million people, while New Zealand has only 2½, million, it seems absurd that we cannot support her if she needs that support.

I would remind the House that our Parliament and our Constitution make us different from the Continent. I have always thought that on the Continent, Parliaments are more like advisory bodies; their rulers take advice from them. Our Parliament is here to rule and, what is perhaps more important, to prevent misrule. I hope that when we go into Europe we can use our influence to bring some of our traditions and procedures into the European Parliament. At the moment, the European Parliament is a very bureaucratic machine. I should like to see it made more elastic. I suppose that when we first go into the Community the Members of the Assembly from this country will need to be nominated. I hope that we shall choose people irrespective of Party, and that we shall endeavour to choose the best people for the job. I should like to see chosen people who were not bound up with any particular sectional interest, whether business or the trade unions. I should like to see them as people of broad knowledge who have the interests of this country really at heart. I believe that what the noble Lord, Lord Chalfont, was saying was that eventually, obviously, there will have to be an elected Parliament, otherwise the situation would not be feasible. So far as his wish for a majority decision in the Council is concerned, that could go against us in some ways. At the moment I understand that decisions of the Council are always unanimous. So if our representative did not agree, presumably the particular policy in question would not become Community law. If there were a system of majority decision, this particular policy might be passed. But, as I say, the system can work both ways. In the end, I think that majority decisions are the right answer. My Lords, it is my belief that the sooner we are in the Community, the better. I can foresee a great future in Europe.

6.59 p.m.

LORD WIGG

My Lords, I trouble your Lordships but little. It was not my intention to speak tonight for more than a few moments, but I may be tempted to speak for a little longer than I had originally intended having listened to the speech of the noble Lord, Lord Chalfont. It was quite a remarkable speech because he went out of his way to tell us that he was not engaging in a polemic. I have in my time, although I am a recently reformed character, engaged in controversy and in a polemic or two. But I do not think that ever, even at my best or worst, according to how one may look at it, I have used quite so many epithets about those who do not agree with me as did his Lordship tonight. Having told us he was not engaged in a polemic, he dismissed the arguments of those who do not agree with him, first, as lacking in imagination, sterile, and I think at the end he used the word "disgraceful". That is not the language of democracy. The noble Lord, Lord Chalfont, dismissed the whole proceedings as a boring exercise, and there was rather an undercurrent of thanking the Almighty that tomorrow the papers would not be reporting what he and others had said. Perhaps that is stretching it a little, but anyway so far as he was concerned, here was the Treaty of Rome; God bless the Treaty of Rome, he would not seek to amend it; everything in the garden is lovely!

So I would invite the attention of your Lordships to the fact that there are some of us who have at least one advantage over the noble Lord. I would not claim his experience or the penetrating intellectual capacity of one who can refer to those who do not agree with him in quite the terms he used. But speaking for myself, I have fought seven Elections and have won them all. That gave me some little understanding of the working of democracy and what it may mean if a mistake is made by Her Majesty's Government and by your Lordships' House. For the central point when considering the Treaty of Rome is how it will affect our economy and how it will affect the prosperity of the British people in the years to come. It will also have a profound effect—indeed I think it has already had an effect—upon our relationship with the rest of the world.

I have always thought and have taken great pride in the fact that Britain was the outward-looking centre of a great Commonwealth. One thing that is now certain is that that has gone forever. I can never forget, however (because I lived through it) the 1914–18 War and the help that we got from the far off parts of the Empire. I am just old enough to remember that Britain, in her hour of peril, was helped on the veldt in South Africa. We never looked in vain to those who were our kith and kin, who had gone out to the far corners of the world and there established a way of life similar to our own but came back to help us in our hour of need. It may well be that circumstances are so changed that we are in fact a defeated nation; that we must accept the terms which are imposed upon us by those with whom we are now required to associate and thus we must forget our friends of yesteryear.

The noble Lord, Lord Chalfont, said that we are engaged in an exercise with friends. May it be so. I hope that this adventure (as I regard it) may prove to be a success, but supposing it is not? Your Lordships then will indeed have to search your consciences. But your fellow-countrymen will have to pay the price because Britain is going into the Common Market and the noble Lord will not even seek to amend the conditions. Not for him the small print. It is enough for him that the friends with whom we are to associate have provided the small print and laid down the conditions. We must accept the small print whether we like it or not. We shall, it is true, have a veto. But we shall be in and we shall be unable to get out. At least that is the doctrine.

So much for the noble Lord, Lord Chalfont. I trust that some day he will learn the language of democracy and that the words he used tonight, although met with the approval of a number of your Lordships, do not form the kind of language in which one engages with one's fellow-countrymen when facing up to an historic decision which in many ways is irrevocable.

The reason I trouble your Lordships to-night is to give a reminder, if I may without impertinence, of what has been said very often in the past. I am not going to quote too many references; I am not going to stress the statement of the Prime Minister about the requirement of the full-hearted support of Parliament and people. I do not remind your Lordships. I just mention it in passing. But how many times in my lifetime have I been reminded of the great wisdom that reposes in your Lordships' House and the dual function enshrined therein? I have quotations—very respectable ones —from the noble Lord, Lord Carrington, on November 21, 1968, and from Sir Alec Douglas-Home in another place on February 3, 1969. They both said the same thing. They said that the necessity for a Second Chamber rests on its revising role and also on its delaying capacity. The opportunity, the duty enshrined by our membership of this House is that where a Government are taking action which is irrevocable and in circumstances which leave us uncertain that they have the wholehearted support of the country, it is the duty of your Lordships' House to give the country an opportunity of exercising second thoughts.

I am one of those democrats who never can see the political conspectus in bits and pieces. Look at our current position as a whole. Look at the position of the Government to-night. They are in difficulties over the docks; they are in difficulties (although they have the support of the overwhelming majority of our fellow-countrymen) in Northern Ireland; they are in difficulties on this issue of the Common Market and the Government can, if they choose, solve all three problems by going to the country and securing the endorsement of the electorate on the policies which they are putting forward. If that is done, after a General Election the electorate will have an opportunity of being brought face to face with what is involved as from January 1 next on the subject which faces your Lordships to-night.

I am not one of those who believe that the effects of our entry into the Common Market, favourable or unfavourable, will come upon us the day after we join. If the decisions are wrong we shall not die of hæmorrhage; we shall die of pernicious anaemia. Let us suppose that the great flow of capital from Europe into this country does not take place, but, on the contrary, that British financiers, who always show themselves to be patriotic with the country's interests at heart, decide that the opportunity for the maximum security and the maximum return on their investment is not in the West Midlands, in Scotland, in North-West England, or even in Ulster, but is across the Channel, and the flow of capital is not into Britain but from Britain. What will then happen to our economy? Your Lordships should not forget that the signs are already there. The Common Market is pressing like the piston in an engine, driving up land prices, causing acute shortage of labour in the South-East of England. That is a warning to the rest of England about what may happen, for the Common Market (if I may change my metaphor) is acting like a magnet. It is sucking economic strength into the South of England. It is drawing the "guts" out of industrial England, with the result that in the part of the world where I come from there is every prospect—not overnight, but in the course of a few years—of parts of the Midlands becoming an industrial slum.

If anyone in this House thinks that having gone into the Common Market the last word has been spoken, he should disillusion himself. Just look, my Lords, at the difficulties of the Government over the Industrial Relations Act. I ventured to write a couple of letters to The Times on this subject when I saw that the leaders of the Labour Party were not saying what ought to be said. I said "Watch out! See where you are going. This may land you in difficulties you wot not of." I repeat the same warning on this issue of the Common Market. My words may fall on stony ground. But we shall be judged, not by my words or, for that matter, by anyone's words. I venture to say that if we go into the Common Market and it does not work out in, let us say, a period of five years, among the first victims—and very rightly —will be your Lordships' House. For the only claim that your Lordships House has to political honour inside our society, as we know it, is that it exercises the right which your Lordships, mostly from the Conservative Benches, have so often claimed—and rightly claimed in my judgment—to perform the function of a revising Chamber, doing what the House of Commons so often does not do and perhaps has not got the time to do; but also claiming on behalf of the electorate as a whole that when an Administration has outrun its mandate or is being forced under pressure to take action which your Lordships in their wisdom doubt, then the plain duty of your Lordships' House is to force the Government of the day to put that principle of delay into practice in the only place to which it can properly be referred—namely, to the electorate of our country.

LORD CHALFONT

Before the noble Lord sits down—

LORD HALE

My Lords, if the noble Lord wishes to give way to the noble Lord, Lord Chalfont, of course I will sit down.

EARL JELLICOE

My Lords, I think the noble Lord, Lord Wigg, had in fact finished his speech and the noble Lord. Lord Chalfont, was exercising the normal convention of asking him a question before he sat down.

LORD CHALFONT

Indeed, my Lords; I am grateful to the noble Earl. Normally I would have asked the noble Lord to give way and asked this question in the course of his speech, but I did not wish to interrupt a speech which to me offers the reason why the noble Lord was victorious in seven General Elections. I would like to ask him whether he is aware that I did not abjure polemics; I do not think they can be abjured in this case, and I was making an openly polemical speech on this subject. I would also ask him to believe that I do not despise the views of my opponents; I only despise those opponents who distort the facts in putting forward those views. I would ask him also to be assured that I have read the small print of the Treaty of Accession to the Treaty of Rome., I dare say as assiduously as any Member of your Lordships' House. Finally may I say that if he is accusing me, as he seemed to be, of forgetting the language of democracy—

LORD SHEPHERD

My Lords, I would only say to my noble friend that I thought he rose to ask a question of the noble Lord, Lord Wigg. We are not in Committee. Shortly we shall be in Committee, and comments will be open for challenge and answer. I rise only because the noble Earl who is the Leader of the House was I think rather reluctant to intervene on what may have been a dispute between two old colleagues. I rise only because I thought we were getting into an area where perhaps the rules of the House were being slightly abused.

EARL JELLICOE

My Lords, I think the noble Lord. Lord Shepherd, is in fact right. I only intervened when the noble Lord, Lord Hale, stood up because I assumed that the noble Lord, Lord Chalfont, was going to ask a question of the noble Lord, Lord Wigg. Perhaps if both the noble Lord. Lord Wigg, and the noble Lord, Lord Chalfont, have finished, we may now hear the noble Lord, Lord Hale.

LORD WIGG

My Lords, I, of course, readily submit myself to the conventions of your Lordships. If the noble Lord wants to ask me a question I am quite willing to answer. Everything I said about his speech I have down, so it is for the Record to show which of us was right.

LORD CHALFONT

My Lords, may I simply, while submitting to the ruling of the House, point out that I was asking questions.

7.14 p.m.

LORD HALE

My Lords, I congratulate the noble Earl the Leader of the House on the way he handled the affair, and on how he was able to judge from the position of the noble Lord's bottom whether he had finally resumed his seat or resumed it only temporarily. But, of course, I had no desire whatever to interfere. I desire to express the pleasure with which I follow a very old friend, a very close colleague, who made a speech with which I did not entirely agree but which certainly showed that he is back in his old form. I am sorry that the noble Lord. Lord Chalfont, is going, because I intended in a single sentence to thank the noble Lord, Lord Wigg, for having said some things that I would dearly like to have said myself but had thought, in view of the decorum of the House and the humility of a young Member, would not perhaps be appropriate to me.

I also wish, with the permission of the House, to recall an old friend of both of us, a name which has never been mentioned once, so far as I know, in ail the pages and columns of debate, and that is R. W. G. MacKay, who was the first chairman of the all-Party Committee on a United Europe and who first brought M. Spaak over, who propaganded for a united Europe day and night. He was a partner in my firm. It was not a terribly successful partnership, though he introduced us to some very fine people, but he pursued the cause of a united Europe as devotedly as any Member of Parliament ever did. It was, of course, the clarion speech of Sir Winston Churchill at Zurich which really led to the summoning of the Hague conference.

It was R. W. G. MacKay who, by a single act of magnanimity on the part of Mr. Winston Churchill, as he then was, was leader of the all-Party delegation. I remember that delegation. We went, of course, without the permission of Transport House; indeed rarely did I travel with their permission. There were 28 of us who promised to go, mostly unknown in those days: 27 arrived; and there was a star-studded delegation of 25 Conservatives, including three future Prime Ministers and two future Lord Chancellors, who met at that historic conference in the Riddesdaal, where Seyss-Inquart had so recently pronounced the final subjugation of the Netherlands and where we, in a mood undoubtedly of euphoria and perhaps the sort of emotion that I am apt to display when it does not mean anything, did draw up plans for a 16-nation federation of Europe. The resolutions were carried unanimously by all these countries pledging ourselves to work for the cause of a united Europe. And I ought to add, in tribute to Sir Winston, that the magnificent speech that he made on that occasion was submitted to us for correction in case he had said anything which might affect our position in the Labour Party, which was always precarious, and we sent it back unaltered. That was the day of euphoria and that was the day of vision.

Then, of course, as everyone knows, this vision faded in the conflict between the U.S.A. and the U.S.S.R. and the coming of American troops to help with our defence and so on. What once seemed a great ideal was almost a practical proposition when Europe was destroyed and had to be rebuilt, and might as well be rebuilt sensibly on a planned economy. The vision passed but some things came out of it, as the Council of Europe. I was there for a brief period and I felt that I met some people who were the salt of the earth. While I was there it was being boycotted by the French and treated with much discourtesy by the Council of Ministers, but it was full of the salt of the earth of Europe really working together in a spirit of idealism, and we did things in the field of transport and penal reform and so on even there.

Now we are called upon to consider a tardy accession to a free trade area first conceived in 1956, a very great event in the history of Europe, which required a good deal of self-sacrifice and of internationalism on the part of the participating nations. We were held back by the Commonwealth concept, as everyone knows. And years went by. I beg noble Lords to remember that what we are now being asked to accept is an almost newly-constituted Common Market area, reframed in 1969 and 1970—after a series of economic disasters all over Europe—for the benefit of France, who was always the recalcitrant partner, contributing in the Common Agricultural Policy something like £1,000 million to the French economy. I do not wish to say a controversial word at this stage, but I was not greatly moved by the observation of the noble Lord, Lord Gore-Booth, on the authority of a well-liked and very gifted Labour Back Bencher, that if they asked us for a few hundred million too much they would probably not insist on our paying it, so long as we showed that we could not pay. This is one of the difficulties which we may have to confront at once, and I say with real regret that I should not like to see Britain suffering such humiliation. But I am not at this moment convinced that we are going into the Common Market at all.

I had intended to confine myself to the question of regional policy. I was not assured by the noble Lord, Lord Chalfont. I think that if any noble Lord reads to-morrow the report of the noble Lord's speech he might also read in full Regulations 92, 93 and 94 of the Treaty. We were recently told—and it matters not whether or not it was true—that West Germany had raised the question of the limitations of the Treaty in her own favour, and the question whether our regional policy is in conformity with the Treaty. I hope that that is a question upon which we shall have a clear answer, not from the noble Lord, Lord Chalfont, but from the Government Front Bench, with a clear and unequivocal assurance—and I am quite sure that they would not say what was not true—that the regional policy is not subject to the revision of the Commission. I will tell your Lord-shins why I say that. I hope noble Lords will forgive my doing so in terms of Oldham.

I have been told that one should not be a constituent Member of this House and, in fact, I have never lived in the North. But it is a town that I know, and I am speaking on behalf of North-West Lancashire, of the North-East of England and, indeed, of Scotlard, which will all become peripheral areas of Brussels; and when Scotland becomes a peripheral area, it may well be that the fiery totem will pass around the clans again. In Oldham, we had a population of 147,000 in 1911, and to-day it is just a fraction over 100,000. The people have gone, some young and active, and we have been left with that town, which is representative of the North of England, and which has a local government debt of almost exactly £100 per head—man, woman and child—of the population. We have, of course, to maintain a high proportion of geriatrics.

I have read through the reports of almost every word of these debates. I have read through speeches in which reference was made to the South of Italy, which has exactly the same problem. In fact, it is historically worse there, because the South of Italy has probably never had much in the way of stable Government until recently, probably not since Robert the Wise, and that is going back 630 years. It has almost been a place of violence. People talked in previous debates about the Case por il Mezzogiorno—an elaborate phrase, but so the venture is called. When I was last in Naples. I went to see another case. I went to see the House of the Urchins, which still exists with the same poverty,. with the same problems. That is not because people do not try. I pay great tribute to what the Italian Government has done, in all its Parliamentary troubles, in starting to reconstruct an honest police, in starting to get a really honest disposition of public funds, which is something quite new. Dante was troubled by the floods in Florence, which were repeated every few years until the recent appeal. They are trying hard to develop an honest local government. These are reasons why we should help them and why we should not abstain.

But a fear deep in my heart is that the North will be denuded in order to re-populate the South, where great towns have been built since the war and where industry has been transferred. I fear desperately that the South Coast, with its transport to the Common Market, of England will become the Mecca for English industrialists. I see no reason to anticipate any transfers of labour to Scotland, with all its transport problems. But I fear for the regional policy which is allied to the question of democracy. I think it was Sir Winston Churchill who said: Democracy has no particular advantage, except that it is better than any other system. I know that the noble and learned Lord, Lord Diplock, would not wish for any observation on his speech, but I believe he spoke with the authority of a judge and with the clarity of an advocate, without passion and without controversy. I think that he made what is perhaps the most important speech that has been made in the whole of these long debates. I should like to look at the Report of it to-morrow, to read, learn and inwardly digest it. I hope that some other noble Lords will do so, too, because we are talking of Parliamentary Government. We know that democratic Parliaments have broken down under the strain of the multiplicity of events and the forces of technology.

Perhaps I may conclude by quoting from a book published in the last few weeks on the question of regional policy. I shall read from my written note, as I should not like to read from the book itself. In Britain, France and Italy there is a trend towards regional devolution, even if there is at present no thought of transformation into a Federal State with a Parliament for each region with substantial powers entrenched in a Federal Constitution. But at the same time, the European Community appears to be moving towards a repetition of the old centralising errors in the nation States, by making economic policy instruments uniform over the whole area without considering whether this will allow peripheral regions to be prosperous or not. For the thrust of the Community development has been towards free trade, uniform agricultural prices, uniform tax systems and rates and now a common currency rather than towards common action to abolish poverty, unemployment and regional depression. Unfortunately, the world does not work like this, and among the first casualties will be the regions outside the golden quadrangle, for they will find themselves bound to that golden Moloch by Community rules of fiscal and monetary uniformity, and this because the Community's economy is bigger and its institutions still more remote than those of the existing nation states, which will make this predicament even worse than it is now. That is the opinion of Mr. John Pinder, of Political and Economic Planning, in a book published under the auspices of the Royal Institute of International Affairs which is certainly not opposed to the Market; it is merely discussing the future of Europe as it should emerge. Unless there is some real hope of federalism then I do believe these areas will suffer, and there is no example I know in history of a democracy which was allowed to perish and was later permitted to revive without a revolution or a civil war.

I shall to-night take the advice of my learned leaders on the Front Bench and abstain. I do so because of the respect that I bear for all of them, and the affection I have for some of them, and mainly because it precisely suits my own views at the moment. However, on the Third Reading when we have explored the matter. I shall have to face the problem of whether to betray, as I see it, the North, or betray the friends with whom I have worked for a united Europe. It will not be a decision that one comes to lightly, easily, or even polemically.

7.31 p.m.

LORD GREENWAY

My Lords, I am delighted to follow the noble Lord, Lord Hale, who, I know, holds the Olympic record in another place for being the fastest speaker in his day. I must apologise for once again speaking on this historic subject. Unlike the noble Viscount, Lord Watkinson, who has done it four times, I have done it only twice. I fully support the Second Reading, and I should like to say a few words to my noble friend—who I see has now disappeared—about the value of our bloodstock in the Common Market.

I shall speak to your Lordships for only a few minutes. As the only Member of your Lordships' House to visit the Grand Duchy of Luxembourg with a Parliamentary delegation some three weeks ago, I felt that I ought, for a few minutes, to give your Lordships some insight into the smallest and most delightful member of the Marché Common. We were met by the Luxembourg authorities, including the President of the Chamber of Deputies, the Vice-President, the Greffier and his assistant—the latter two were in constant attendance throughout the visit, and we much admired their administrative arrangements, done with great tact and ability. During the five days we visited the great steel complex at Esch-sur-Alzette in the South, on which a great part of the country's wealth depends. It is here that Arbed, the giant steel company, has its furnaces and rolling-mills concentrated amongst the towns of Differdange, Dudelange, Rumelange, and Schifflange. From this great outfit 16 million tons of steel are cast a year, which represents 67 per cent. of the exports, and the income for the inhabitants for that is 65,000 Luxembourg francs.

It was here that we were conducted around by the directors and the Mayor of Schifflange, herself the Member for that town in the Chambre des Deputés, and also representing Luxembourg in the European Parliament. One was impressed with their efforts for the environment and anti-pollution, and also with the new housing schemes at Schifflange, which were going to be put on sale at a very reasonable price. The delegation then had a meeting with the Secretary-General (a very old friend of mine, whom I met at Strasbourg last year), in the magnificent new building of the E.E.C. Luxembourg.

Having been in the Maison D'Europe in Strasbourg last year, it seems logical that Luxembourg, with its communications, air, road, and rail, and languages, is the main centre for the European Parliament. Another highlight was a visit to the New European Investment Bank, which I think is one of 18 new banks in Luxembourg city itself, where the director gave us a very good brief on all its activities. In the North we next spent a day at the complex of waterworks, pumping-stations and vast reservoirs of the Electricity Authority of S.E.B.E.S. at Esch-sur-SÛre and Vianden. Finally, we met the Prime Minister and Foreign Minister, with whom we had very cordial discussions. Our visit ended with an excellent dinner given by the Mayor of Luxembourg, herself a Deputy and also a Member for Luxembourg representing the Grand Duchy's six M.P.s in the E.E.C. I am glad to say that she is an old friend of mine, and that she told me she is greatly looking forward to coming here next January with the ten Lord Mayors of the capital cities of the E.E.C. as the guests of our own Lord Mayor of London.

Throughout those five days, one grew to admire the strength of character, patriotism, and hard work which had given the people of Luxembourg the highest standard of living in Europe. My Lords, I wish the same could be said of this country, and I hope that our people will realise this before it is too late.

7.37 p.m.

LORD GAINFORD

My Lords, I must first of all congratulate the noble Lord, Lord Greenway, on that beautifully refreshing speech, which has made a delightful addition to our debate. I hope that my own contribution will be as brief. I wish to express my support for this Bill, but in addition I wish to express not only hope but confidence that what is said in this two-day debate will do much to overcome the fears that so many people have expressed in various ways concerning the vital step that this Bill involves. To some it is like a step into the unknown, and the unknown always breeds fear. Some of these fears have already been expressed to-day. I shall only make a short mention of a few. There is the fear that we are going to lay upon ourselves financial burdens. According to the arguments put forward by some opponents to the Bill, it would seem that we shall be almost financing the entire scheme once we are finally in the Common Market. There is the fear that the cost of living will rise by leaps and bounds; there is the fear that our trade with the rest of the world will suffer; and the major factor is the concern for our trade with Australia and New Zealand, as well as with the remainder of the Commonwealth.

But I wish to speak of two other strong fears of which I have been told, and I hope that we may hear of some solution to them if the grounds for these fears really exist. First of all, there is the fear of industrial espionage. A number of your Lordships may already have studied the report compiled under the chairmanship of the right honourable Kenneth Younger concerning, privacy and the invasion into the citizen's private life, and of the threat to industrial secrets. Yet only limited legislation exists to protect industrial organisations from the activities of rivals trying to learn their secrets. In some of the countries already in the Common Market there exist very strong laws against this activity. It may still be carried on, but those who indulge in it run very grave risks. Until the legislation in this country is improved to protect our industries further from the prying of rivals, there will be considerable concern about our entry into partnership with countries who are protected from it. Should the cause for such anxiety be groundless, I am sure that that news will be very welcome to many businessmen in this country.

Finally, there is the suspicion, already mentioned, that we may lose our very independence, and even our identity; that we shall no longer be truly British. We know that we are British, we know that we are European; but we have got to take on a sort of new form of European-ship. There are even such outrageous prophecies expressed in the Press that our Monarchy will be threatened. A few weeks ago, outside your Lordships' House I saw an anti-Common Market demonstration, and one of the placards carried the words, "Must we take orders from Brussels?" I cannot see that the Common Market will result in any domination of one country over another. What will be decided at Brussels will be the results of agreements made by representatives of the countries concerned, and our influence in what is agreed there will be no small factor.

It is evident that the present Common Market countries want us to join them. Clearly, we have much to give and much to receive. If there is any loss of our country's power, it is likely to affect us no more than whatever control this country may have lost by joining NATO, and the effect that such agreement has on the use of our Forces. It is more appropriate that we should be in a position of power and influence within the Common Market rather than as a nation on the outside, because if we remain on the outside we shall be seeing the tariff barriers going up in a situation in which we shall be virtually powerless.

7.42 p.m.

LORD BROWN

My Lords, the Second Reading of this Bill is a very difficult occasion for speakers in your Lordships' House to keep within the normal terms of a Second Reading debate, because the Bill is what I would refer to as a very high abstraction Bill, covering in an extraordinarily small number of clauses laws which extend over a vast range of activities. It is for that reason that I shall follow many previous speakers in making a short speech, I hope, but one that is not all strictly all relevant to the Bill which was have before us.

Before proceeding further, I should like to pay a tribute to the noble Lord, Lord Greenwood. I am not on the same side of the fence as he is: nevertheless, I thought he made a remarkable speech. It affected me very deeply indeed, and his obvious sincerity was something to value. The second speaker I should like to pay a tribute to is the noble Lord, Lord Stow Hill, because I believe that his acute technical mind and his felicitous way of expressing himself was a great contribution to the debate. He asked a range of questions of the sort I should like to have been able to frame; and I am going to listen with great interest and excitement to the answers that the Government give to the questions he puts, perhaps to-morrow and later, during the Committee stage discussions on this Bill.

First of all, I should like to make my own personal situation clear. I believe that we are in for three to five years, at least, of a very serious and troubled situation when we join the Common Market. I do not think there is any doubt about this. I have no euphoria about this decision whatever. It is commonplace that we are giving up an agricultural policy which has been extraordinarily successful for one which I think every member of the E.E.C. admits is a great deal worse than the one we are giving up; that is, the Common Agricultural Policy. We are giving up a system of taxation—purchase tax, and the rest of it—which is infinitely simpler than the system that we are about to embark on; and when the Germans adopted V.A.T. I am told that they had to employ no fewer than 7,000 extra civil servants to operate it. I could mention many other aspects of the conditions which we shall have to accept that are extremely worrying to me and, I am sure, to many other people.

In general, we are joining a Community which has accepted a range of laws and regulations which are far too much the results of long-term kowtowing to the French nation in their extreme chauvinism. It is for these reasons that I feel extraordinarily anxious about the decision which is inevitably, I think, going to be taken by Parliament in respect of these matters. I am suspicious and anxious that when our Prime Minister, Mr. Heath, visited M. Pompidou, he kowtowed to M. Pompidou in the same way as other nations have been kowtowing for so long. Just as an aside, I would say here that the vicious criticism which has been made in the Press over the last year of Harold Wilson, the Leader of the Labour Party, has been, in the light of the vast decisions with which we are faced, absolutely grotesque. So these are my misgivings, but I am bound to say that, if the House divides on this Second Reading, I am going to vote in favour of the Bill. Why? Because I cannot face the probable situation which will emerge ten, fifteen or twenty years hence, when we shall see a trading bloc in South America; a trading bloc in North America; a trading bloc in Europe; a trading bloc in Eastern Europe; a trading bloc involving New Zealand, Australia, Indonesia, the Philippines and Japan, in the Far East and so on. I think that if we stay out now it will be very difficult to get in later; and if we are indeed an isolated country outside any of the world's great trading blocs, I think our children will look back upon us as having made a profound mistake in spite of all the anxieties which our entry will produce in me, at any rate, if not in very many other people.

So much for my personal reactions, my Lords. I have only one detailed and perhaps insignificant point to ask about the Bill: I leave the rest to the noble Lord, Lord Stow Hill, and others. It concerns Clause 9(7), and I mention it now so that it may come up later. It is this: if a company in this country makes mention of its share capital on its letter heading or in any communication, it is bound by that clause to make mention of its paid-up share capital. This is a most extraordinary, detailed thing to get in a Bill of this comprehensive nature. I do not know why it is there, and it is going to lead to a great deal of difficulty. I took the trouble to look up the 1948 Companies Act and the 1967 Companies Act to see whether there was any definition of "paid-up capital" in either of them, and there is none. The lack of definition and the requirement is extraordinary, and I mention this more or less in passing. No doubt the reason can be explained later.

The last part of what I have to say I am going to devote to some details on a subject to which I think no Minister of the Government dare refer—and noble Lords will see why when I launch myself on this minor crusade. I have said already that the Common Market has been born partly of the common sense of European leaders but regrettably, and partially, of French chauvinism. I am desperately scared of this. I am scared for these reasons: that I had experience at the Board of Trade, and one of the things which was inborn upon me was the very high integrity of our Civil Service in drafting laws and in implementing laws in strict accordance, not only with their wording but also with their spirit. The same can be said of our Judiciary in this: it has outstanding integrity. I am going to say boldly that I do not think anybody can say the same of the parallel institutions in France.

Let me give your Lordships two examples—and there are many that could be given. As a Minister, I was approached on several occasions by British companies which had trading subsidiaries in France in which they possessed a major interest. They complained that by devious means these companies, because they were British controlled, were robbed of things to which they were entitled by the machinations of French officials and by other regulations in France. On one or two occasions these matters were taken up by the Foreign Office with the French Government in Paris, and they were assured that these things did not happen. But the proof of the pudding came in the eating, because I noticed subsequently that each of the firms which so approached me sold out its majority interest and ended up with a minority interest. If this sort of thing goes on, we shall end with French firms controlling their subsidiaries in this country and British firms not controlling their subsidiaries in France and elsewhere. There is another point which I give just as an example. The licensing of processes and patents and so forth is something which is going to grow very much in the future. The French Government vigorously control the rate of licences that they allow their native firms to pay on all foreign patents and know-how agreements. The result is that the average level at which French firms pay for the benefit of overseas technology and invention is much lower than in this country or in America.

Regulations of this sort are rife in France. There is close collusion between French officials and French business people; there is not the same integrity about law in any of its forms in France as there is in this country. We all know of the extent to which the laws on taxation are evaded in France and also in some other European countries. I am not for a moment suggesting that we go into the Common Market with the intention of behaving in that way and of losing our integrity. I am suggesting that we must take rigorous steps to maintain our own behaviour and to set up some form of institution which will receive complaints about these things which come from British companies and individuals, an institution which can pursue with vigour the injustices which arise out of them.

I do not think that the present institutions which handle these matters are sufficient.

My Lords, I am bold enough to stand up in this House and make these comments which, if they were made by someone more important than I, would no doubt be extremely offensive to the French nation. Made by somebody as insignificant as I, they will be merely a plea to the British Government to think about this thing. I wonder if we could have a Select Committee of this House specially to act as a watchdog over these matters when we go into the Common Market. If we go in without some sort of institution which is specially asked to look at these injustices, perhaps some form of international ombudsman protecting the rights of British companies and individuals who are the victims of manipulations of the law in France and elsewhere, we are going to have a lot of injustices, while foreign nationals from the Common Market in this country will get the benefit of a law which is implemented with the integrity for which we are famous.

My Lords, I have finished. If we divide on this Bill I shall vote with the Government—almost with reluctance, with anxiety in my heart, with the knowledge that we are going to be faced with a very troublesome time for many years ahead but with the conviction that in the long term we shall look back and believe that this decision has been the right one.

7.54 p.m.

LORD HANKEY

My Lords, I cannot see that we have any cause for anxiety in looking forward to the time when we ratify this Treaty. As the last President of O.E.E.C., I have had a good deal to do with international co-operation in economic matters. My experience is that difficulties will always occur but that if you take the experts, shut them up together and say, "Do not come out until you have a sensible solution", they always come up with some good idea or other, providing they are not given idiotic political instructions. Sometimes that happens; but on the whole my experience at 0.E.E.C. and O.E.C.D. was extremely encouraging.

Then, having been Ambassador in Stockholm in the years before 1960, I consider myself more or less a founder father of EFTA. I should like to say that when we concluded EFTA there was a great deal of anxiety about what was going to happen. Some industries, particularly the paper industry, said that this was going to be most embarrassing for them. Of course, paper did not have a very good time and the industry would have greatly preferred our joining the Common Market. In the event, EFTA has undoubtedly been a colossal success. There has been an enormous increase in trade; it has been to everybody's advantage and has brought us to the position that we are now able to enter the Common Market—which was the reason it was founded.

Another interesting point of doubt was that a lot of people, and particularly the French, said that you cannot have a successful free trade area because there would be distortions of trade. As each country has its own customs duties goods would tend to come in through the country with the lowest duty and enter indirectly those with the highest duty without paying the proper tariff. This would lead to distortions of trade. That was the reason the French gave for not allowing the proposed enlarged free trade area embodying all of us, plus the Six countries in 1958. But in EFTA nothing like a distortion happened.

An admirable system widely used in the British Commonwealth was introduced and I have never heard any serious complaint about distortions of trade. It is interesting to see that, under the arrangements now in force, the Common Market has a free trade area with a large number of countries in Africa, and there is going to be a somewhat analogous arrangement with those countries of EFTA which are not going to join the Common Market. I think that that arrangement is extremely welcome. It bears out what I say: that the difficulties feared on these occasions can usually be solved. It is interesting that when the E.E.C. was founded in 1957 the Six also had grave doubts about what was going to happen. It was really epoch making to create such a huge customs union and to abolish customs duties between the States. They had the same experience as EFTA, which was able to reduce internal duties between member countries years ahead of schedule. The Common Market was also able to reduce those duties a good long time ahead of schedule.

I have never heard of any serious section of opinion of any E.E C. country which wanted to leave the Common Market and still less to have it abolished. It is patently to the advantage of business and to the national wealth of all the member countries, and it is equally patently to the advantage of the workers. All the Socialist Parties of the Six are very much in favour of it. They have been truly dismayed at the volte face of the Leaders of the British Labour Party and they have not hesitated to say so. They were greatly looking forward to much warmer co-operation with British Socialists and as far as I am concerned —I have seen a good deal of this in the foreign affairs that I have been connected with—I greatly hope that warm and confident relations and co-operation will be re-established there.

The Communists, of course, are not in favour of our joining. Moscow's policy is to divide nations and to exploit the differences between them. So the Communists could not be expected to favour our joining. But it is interesting that even among the Six, the Communists, as I understand it, do not advocate breaking up the Common Market because that would be too unconvincing in view of the favourable effect of the E.E.C. on the standard of living of the workers. The Communists could not get away with it.

It is interesting that our involvement in Europe—one might say in the Common Market—is taking place even though we have not yet ratified the Treaty. I travel a great deal on the Continent, partly on business and partly on pleasure, and I have noted for some time that wherever I go I find British subjects owning hotels, serving petrol at the pumps, working in bars, owning restaurants, working in business all over the place. Thus in many businesses you find British subjects flowing into the Common Market and I believe that their services are greatly appreciated there. They seem to enjoy themselves and to make a success of it. As the Common Market is obviously successful, I think that we should certainly join and put our shoulder to the wheel. Also I think that this Bill represents Common Market was also able to reduce law what is in fact already happening.

My Lords, we have heard a lot about sovereignty and I should like to say two words about it. I cannot really understand the anguish some people have suffered about the alleged effect on our sovereignty. I cannot for the life of me see any serious infringement of it. Power in Brussels lies in the hands of the Council of Ministers. We shall have a major voice there. Then, presumably, we shall be represented in the Commission and in the remarkable Secretariat. We shall certainly be represented in the European Parliament and in all the Community institutions.

Good gracious! What opportunities for influence we shall acquire. What an opportunity to contribute, with our political, economic, social and scientific experience, to the onward progress of the Continent in which we live. How valuable our great overseas connections ought to be. It would be inexcusable to miss such a chance. I do not regard this in any way as the end of the Commonwealth. A great many Commonwealth countries will be associated with us in one way or another, and I think that our connections with them will endure and will be a tremendous advantage and asset for the new Europe.

My Lords, how much did our sovereignty suffer by the formation of NATO? It is interesting to look back. How could "Colonel Blimp" ever have agreed to British troops being stationed permanently on the Continent? And, "By gad, Sir!"—to quote that famous character—under overall foreign command? What a suggestion. It was a Socialist Foreign Secretary, Mr. Ernest Bevin, who took that, as some people thought, unpardonable risk—and thank God that he did. It was the noble Earl, Lord Avon, a Conservative Foreign Secretary, who later persuaded all the NATO countries to accept Western Germany as a member and to accept. a German rearmament to enable Germany to make her necessary contribution. That was a vast diplomatic achievement, revealing prodigious foresight and courage, which makes him also a founding father" of the new Europe. I think it is an achievement for which he will always be remembered.

Without the enlarged NATO 20 years ago I greatly doubt whether we should be discussing anything serious here to-day.

No doubt it made some dent on our sovereignty, but what a tremendous advantage it has been. Unless we join the enlarged European Economic Community, to which I believe we have such an important contribution to make, I greatly doubt, when I look at the looming thunderclouds in the East, whether we shall be discussing anything serious here 20 years from to-day. My Lords, we live in a brilliant Continent, where we all have very high standards of genius and achievement. All Governments for 10 years have advocated our joining the new Europe. The electorate has voted for that repeatedly. I think it is time to stop to-ing and fro-ing and to go forward with confidence and pass this Bill. I hope your Lordships' House will give it a thumping majority if the House is divided on its Second Reading.

8.7 p.m.

LORD MERRIVALE

My Lords, I certainly agree with the concluding remarks of the noble Lord, Lord Hankey. I am sorry that the noble Lord, Lord Brown, is not in the Chamber, since I should like to take him to task as I am privileged to have a number of French friends—civil servants, Parliamentarians, Ministers, businessmen and students. I think it a little unwarranted that the noble Lord should have made such an attack as he did. A cousin of mine happened to be Secretaire General du Gouvernement in the French Government, which is equivalent to the post that Lord Normanbrook held in this country, and I think that the noble Lord's attack on the French Civil Service and the Parliamentary system was a little unfair.

The only point on which I would agree with him is when he said, in effect, that French businessmen and civil servants very often got together and saw eye to eye. I think it is a very constructive point of view and a good system whereby very often they go to the same lycée and university. Thus, in effect, the economy of the country could develop more satisfactorily due to the fact that civil servants and French industrialists have known each other's way of thinking.

My Lords, I should like to welcome very much the introduction of this European Communities Bill for I do not believe that we should remain on the sidelines of Western Europe. With the marked change in the West European political climate since December, 1969, and the new emphasis on uniting Europe since that meeting at The Hague, it seems a pity that in some quarters there should be such fear that if we join the E.E.C. we shall have to pay dearly for our entry in terms of sovereignty.

I remember the lukewarm reception that the French Assemblée-Nationale gave to the ratification of the Treaty of Rome, in about 1957 or 1958, and the French nationalistic outlook. The noble Lord, Lord Brown, called it French chauvinism; I think it is a nationalistic outlook on the part of many of the French. I think also that many people in this country are proud of their country and nationalistic in outlook, so I do not think that one can denigrate that attitude. Like the noble Lord, Lord Hankey, I think these fears regarding sovereignty can be exaggerated. In fact, I would agree with what the Prime Minister said a year or two ago: It is not just, as is sometimes thought, an abandonment of sovereignty to other countries; it is a sharing of other people's sovereignty and a pooling of our own. No doubt, my Lords, particularly at the Committee stage of the Bill, fears will be expressed in respect of the provisions in Clause 2 of the Bill and in Article 189 of the Treaty. Regarding this aspect of European unity I was pleased to read a few days ago that the Foreign Ministers of the enlarged Community had agreed that a European summit should take place in October next, subject to final approval by the Ministers on September 11. I think that in this context Mr. Maurice Schumann's remarks in the newspaper La Nation on January 21 are relevant and I should like to quote: The ten countries of the Community must set to work without delay to size up the tasks ahead, decide on priorities and define ways and means. He added that that would be the objective of the European summit which should mark the next historic stage in the development of Europe.

I think that one would particularly like to see—I certainly would, my Lords—the opportunity being taken to co-ordinate and develop our efforts regarding aid in the public sector towards the developing countries, and also at this summit to see guidelines emerging for private industry to co-operate and coordinate their efforts regarding emergent territories. I suppose, my Lords, one could imagine that the question of European institutions will be on the agenda for October. I should imagine that Her Majesty's Government's representative would be in a position here to play a leading role for I remember during the course of the Dejeuner-Colloque—pre-sided over by M. Michel Debré in November, 1963—that he expressed, in answer to remarks of mine, great admiration for our British institutions. One hopes that in October, if the Community is to be a constructive force in world affairs, certain priority will be given to the question of the democratic development of European institutions.

While the furtherance of a country's interest will continue to be the motivating factor in any changes, such changes could, I feel, come about smoothly with our acceptance of policy packages. I suppose one might call that British compromise—in other words, some less palatable measures would be compensated for by something valuable to each main Member. In this context I believe John Finder's remarks in The World Today in the issue of October 1971 will be valid. His remarks were as follows: If British policy can be sufficiently sensitive to the needs of other members to adopt the role of honest broker, Britain will rapidly become politically indispensable to the Community and hence in a very strong position to ensure that her own interests are looked after as well as to promote the general interest of the Community. My Lords, I think one should agree with those words of John Pinder.

I turn now to one particular institution which I think has been exercising people's minds over the last few months—the European Parliament, the weakest of the Community's three main institutions. I think that over the last few weeks and months at meetings between Agricultural, Finance and Foreign Ministers of the Ten there has emerged a better understanding of the problems of the other Members. This can only mean increased collective power of the Community. Therefore, if there is to be this welcome increased collective power there is a need for increased democratic control. With this country's long background and experience of a Parliamentary form of government, and bearing in mind the Vedel Report, the Michael Stewart proposals and the Commission's proposals (shortly due, I believe) for strengthening the Community institutions, particularly the Assembly, would Her Majesty's Government consider certain aspects which I will put forward regarding the strengthening of certain institutions? One recommendation of the Vedel Report is of particular interest; namely, that in certain fields the European Parliament should have a power of co-decision with the Council of Ministers, such co-decision to involve informing and consulting the Assembly of all relevant Commission proposals and amendments to these proposals.

My Lords, might there also be closer co-operation between the European Parliament and our national Parliament, with the setting up of some machinery whereby Members of our Parliament could be kept informed as to what is happening in the European Assembly? This could take place even before we enter as a full Member. Might a system also be devised so that Ministers are able from time to time to make Statements in our Parliament on matters coming before the Council of Ministers? To turn briefly to the Commission, although Article 155 lays down that the Commission shall exercise the powers conferred on it by the Council to ensure effect being given to rules laid down by the hitter". I must express some fears on account of its bureaucratic conception. I know that in a recent article Michael Stewart said there was a happy balance between a bureaucratic body, on the one hand, and another political body, the Council of Ministers, on the other hand. I am wondering whether this bureaucratic conception could continue in its present form with its appointed members.

Two further points: I remember some months ago when talking in Brussels to some members of this vast organisation how keen they seemed to rush us into a federation. I suppose—and I think the Prime Minister said—this is a sort of evolutionary process. At the moment I believe this country would welcome more an idea of a Europe des patries, but I suppose evolution could develop of its own accord and I do not think any Members of the Commission should impose on this country a federation which, in effect, would not, I think, meet with the wishes of most people in this country.

Secondly, my Lords, if Members of the Commission are to be independent under Article 157 should they also not be impartial from a "political" point of view? I have in mind Dr. Sicco Mansholt's remarks over the B.B.C. I am not criticising his remarks, but I feel he might have a political bias and I am wondering whether, to be independent, one should not be impartial from a political point of view if one is a Member of the Commission. Dr. Mansholt looked forward to the day when the Socialists have a majority in Europe and the Community has Socialist policies.

I have not gone into any detail regarding the provisions of the Bill. I was rather attracted by Geoffrey Rippon's remarks in another place on Second Reading when he said: I hope that when discussing this Bill, particularly at this stage, we shall not forget that its ultimate purpose is to enable us to play our proper part in the construction of a united Europe as a full Member of the European Communities."—[OFFICIAL REPORT, Commons, 15/2/72, col. 286.] I think that the time for discussion will come on Committee stage. In conclusion, I would say that for my part I believe that a strong and politically united Europe will be able to build bridges between peoples and so promote peace and stability in the world.

8.19 p.m.

LORD SAINSBURY

My Lords, during the course of our last debate on the Common Market which resulted in an overwhelming "Yes" for entry on the terms negotiated, I came down firmly in favour of British membership. I have not changed my mind. Therefore, if a Division is, in my opinion, unwisely forced at the end of this debate I will vote for the European Communities Bill which provides the means of implementing last October's historic decision. Having made my position clear I should like, if I may be permitted, to acknowledge the sincerity and deep conviction of noble Lords on this side of the House who hold the opposite view. Opponents of the Bill and of our entry into the E.E.C. sometimes talk as though we were asked to sign away our basic rights and to relinquish our sovereignty in favour of an alien power. They also seem to take particular exception to Clause 2 which gives the force of law to present and future Community legislation. It is a line of argument which I find somewhat unconvincing. It is undeniable that in joining the E.E.C. we shall give up some of our sovereignty. However, in my opinion this needs to be put into perspective. It is a fact of life that in this world of increasing interdependence all countries must accept some limitation of their freedom of action. In these circumstances, a nation can either stand apart and adjust to world developments which it does not control, or it can, by joining forces with other nations, try to influence those developments. By becoming a member of the European Community we shall give up our independence in certain clearly defined areas in order to acquire greater control and influence over our collective destiny.

Nor do I find the adoption of present Community legislation, as provided for in the Bill, unacceptable. The 42 volumes of Community directives and regulations have been mentioned frequently during our debate to-day. I am only a layman in this, but I would say that since the bulk of these directives and regulations are concerned with giving effect to the decisions of the Community, which we have discussed and accepted, either in their existing or in a modified form, this is no more than a shallow debating point. There is also the point that the noble and learned Lord the Lord Chancellor made—that there is a tendency to look upon the Community, its institutions and its rules and regulations as static concepts. Yet in spite of our failure to enter earlier we are joining a still young and continually evolving organisation where few, if any, of the existing rules and policies are sacred and unalterable. It will therefore be open to Britain to work for changes and to influence future developments.

What is more, I am certain that the next Labour Government will not be without allies amongst other Socialist Governments of Europe. This is true of all aspects of the Community, including agriculture, where integration has been taken further than in any other field. I have never disguised my belief that the Common Agricultural Policy, with its artificially high prices, its protectionism and its manifest failure to solve the prob- lem of the Community's large and relatively inefficient farm sector, is one of the least attractive features of the E.E.C. However, the acceptance of the policies as they stand and approval of the agricultural clauses of the Bill does not mean that we will be stuck with the C.A.P. in its present form for ever.

During the last few years there has been a growing awareness within the Six of the need for reform. It is clear that, with the entry of four new members who are all critical of the policy in its present form, the pressure for change will gain considerable momentum. Already there have been significant changes in emphasis. Although the general level of prices is still too high, in real terms it is lower than some years ago. At the same time, increasing reliance is being placed on structural reform as a means of improving efficiency and reducing the level of price support. Member States have agreed to introduce legislation to encourage the movement of labour, and in some cases of land, out of agriculture. It has also been agreed to provide assistance in the form of preferential interest rates, grants, and so on, to encourage greater efficiency, the enlargement of farms, and the adoption of more advanced techniques.

The Commission estimates that between 1972 and 1976 some 300,000 farmers may avail themselves of the opportunities to retire from farming. About 500,000 farmers will take advantage of the assistance available for modernisation. I am not suggesting that the measures agreed so far are adequate to prevent, in the case of certain commodities, expensively produced surpluses. However, I think they provide clear evidence that the Community knows the imperfections of the Common Agricultural Policy and that it will not, in spite of strong sectional opposition, be unreceptive to further suggestions aimed at the creation of a more rational and effective system of support for agriculture. I am convinced that our voice will be heard and that our influence will be felt in all aspects of Community policy. We should therefore take our place with confidence but not complacency, prepared to accept the existing challenge of the opportunities presented by our membership.

8.28 p.m.

LORD ENERGLYN

My Lords, I still believe that EFTA is a more enlightened and democratic trading area, but it appears that we must now adopt a constructive attitude to entry into the European Economic Community. I hope, at least, that we shall not go in through the tradesmen's entrance. When I first encountered the Treaty of Rome—the German version, because there was no acceptable translation at the time—I was left in no doubt whatsoever that certain sections of the Treaty could not be changed in any way. But my admiration for the British approach to the problems is reinforced by the fact that when one looks at the structure of the European Investment Bank, which after all is the keystone to the viability of the Community, one finds—and I ungrudgingly give praise to the negotiators—that Britain has been placed on a parity with France and Germany. I suggest that this success is really due to the fact that we still have an enormously powerful financial empire at our disposal. Therefore I see no reason to go into the Common Market through the tradesmen's entrance.

May I, following this line of thought, remind Her Majesty's Government that we have many other areas of strength with which to approach the Common Market. I would remind your Lordships that before the war we dominated the mineral kingdom of the world. We could command every type of raw material that we needed for industrial purposes throughout the British Empire; and a residuum of that still remains, or otherwise we should not have this financial empire from which we can project our thoughts and hopes with certainty and vital confidence. I will not bore your Lordships with a treatise on strategic minerals, but that in itself is a powerful argument for looking again at the way we enter the Common Market, if we are to go in.

I am trying to be constructive. But because I have heard too little of the importance of looking at the essential commodity of an economic community, which is thermal-energy, I should like your Lordships to pause for a moment to consider this vital unit of energy and how it is distributed throughout this great industrial empire that we call Europe. For one geological reason or another, the centre of thermal-energy is no longer situated on the Continent. Of course it is right that nature should endow Britain. but she has also endowed modest countries like Norway, Eire and Denmark with imaginative and tremendous sources of power—and later I should like to refer again to Norway.

When we come to look at this boundless energy in terms of productivity—because this apparently is what the Economic Community is trying to achieve —we find that through the intensive working of the coalfields of the Continent, and because of the crushing effect of the production of the Alpine mountain chain out of the Mediterranean, those coalfields are becoming rapidly and increasingly unminable, whereas we who have escaped this enormous earth pressure are finding new coal seams every year. There are many people who will say that coal and solid fuels are finished. But these people are not in step with the modern technologist, who has altered the whole concept of the use of solid fuels. This has had to be, because there is a world shortage of coking coal—industrial coal, if you like. Japan at the moment is poised, not knowing where to go for additional supplies of coke. Where do we stand in this? The same problem affects Germany, France and particularly Italy. So I would appeal to Her Majesty's Government for one small winner again like the European Investment Bank: could they please win for British coal tariff protection? If the Government could do this, see what it would mean. It would mean that Germany will need a minimum of 15 million tons of imported coal; France will require the same, and Italy about 10 million tons. So we are really talking in modest terms of an import of coal into the European Economic Community of at least 30 million tons for at least the next fifteen years. We in Britain can supply this without even increasing our present day output, because we have the additional sources of oil and gas in the North Sea, and of course the hopeful future of nuclear energy.

If we take the consequences of that appeal, we should then have given to the National Coal Board its first ever opportunity to project into the future its productivity, because we in Britain, thanks to the magnificent work done by the British Steel Corporation and the British Coke and Coaltar Research Associations, have produced the techniques of blending different types of coal into metallurgical coke; and add to this the growth of our knowledge of palletisation and tabulisation, and the whole future use of solid fuels is going to take on a new term. When we come to use coke in this country for producing electricity, we are always bedevilled with the problem of deciding whether to use solid fuel, liquid fuel or gaseous fuel, and always we must come down on the side of not creating unemployment. But with an export market of 30 million tons, that problem need not arise. Then we can decide sensibly on what type of fuel we are going to use at our power stations. This would mean that we should be able to look sensibly at a fuel policy. We should be able to abolish the cooling towers of power stations and convert them into district unit schemes. If we could get away from solid fuel-fired power stations we should reduce this problem of the production of rather embarrassing quantities of pulverised fuel ash and make a great contribution to the environmental situation in the country.

If we look again outwards, and indeed inject some of the British fresh air into this European Investment Bank, we may get them to invest money outside in countries like Norway, where there is a vast potential of hydro-electricity. Here could be produced hydro-electricity without disfiguring the beauties of Norway, without polluting the atmosphere, and it could be piped across the North Sea as simply as we are hopeful of piping gas and oil. This would mean that, once installed, these power stations would go on for ever. These, I submit, are not ideas which are not viable. They are within our grasp, and they are things that we have to decide when we come to use the bonanza of the North Sea and the future bonanzas that lie in the Irish Sea and on the Atlantic Shelf to the West of Ireland.

So I appeal to Her Majesty's Government to look at this area of energy as a trading unit. I am not suggesting that we should hold our forthcoming partners to ransom, but they should pay a sensible price for the units of thermal-energy which we, Norway and other such countries are going to produce. In order to do that, I venture to suggest that we should do a little tidying up in this country and set about immediately having an energy policy. It seems to me, looking at this simply as a scientist, that there is no need to construct an elaborate structure for the development of an energy policy. We have a structure available. We have in our nationalised industries the biggest producers and the biggest consumers of energy in the country. We have other factors, too. It would seem to me, if I may be so bold as to offer this suggestion, that Her Majesty's Government should set up a Council for Energy, composed of the chairmen of the National Coal Board, the C.E.G.B., the British Steel Corporation, British Railways, together with the heads of the T.U.C. and the C.B.I., because they must come into the picture to cover labour problems connected with both the public and private sectors of industry. On to such a board I would tack an independent chairman who would be responsible to the Government for energy and, additionally, I hope that he would be a member of a Council for Energy for the whole of Europe. Reluctant though I am to go into the Common Market, I therefore make this appeal to Her Majesty's Government to advance in strength in their negotiations in the area of energy.

8.42 p.m.

LORD DONALDSON or KINGS-BRIDGE

My Lords, I think I am embarking on the 91st speech on this subject which has been made in your Lordships' House over the three debates, and by the end of to-morrow we shall have topped the one hundred mark. Clearly this is quite enough. I apologise for being unable to be present during some of the earlier speeches. I did not mean to be present for many of the later ones but, curiously enough, they have been so very interesting that they pay an enormous tribute to your Lordships' ingenuity in what seems to be an almost impossible situation.

My position about this matter has always been clear. In 1970 I declared that we should go into the Common Market; in 1971 I declared that the terms were acceptable; and I say the same thing now. I have no intention whatever of repeating the arguments which the curious may find in the speeches of my right honourable friends, Mr. Roy Jenkins, Mr. Harold Lever and Mr. George Thompson, now in the wilderness. But what I want to talk about is something which is very limited, and which has been touched on, so far as I have heard, only by my noble friend Lord Sainsbury, the general lines of whose speech I propose to follow. The problem of the Common Agricultural Policy has always bothered me most, and as a matter of fact I think it has bothered most people most—because it was clearly bad. We had a system which was obviously quite all right, and to switch from one to the other seemed rather gratuitous.

The problems of primary producers in developed countries are the same wherever they may be. The more efficiently they produce, the less they get for the produce, the demand for which, after the poverty line has been left behind, is inelastic and the danger has always been overproduction in relation to available demand. This produces gluts and shortages, causing grave inconvenience to the public and intolerable insecurity for the farmer. The solution is to share the cake among fewer farmers and to control production by squeezing prices. We have done this very successfully over a number of years. The number of farmers has fallen drastically, and the number of farm workers perhaps too drastically. The size of holding and of enterprise have both increased drastically. There have been many complaints but few bankruptcies. As a result we enter the Community with great structural advantages.

When we turn to look at the Community we find that although we are some years ahead of them they are quite openly adopting measures similar to those which have been successful with us. They have largely succeeded in overcoming the appalling problem they faced a year or two ago, of heavy surpluses which were accumulating to the extent that at one time there was a danger that they would not have sufficient buildings in which to store them. But they have got over this problem and though there are bound to be variations in different commodities from year to year, which depend on all sorts of conditions, in general they are not at the moment threatened with really vicious surpluses and they are certainly alive to the dangers of over-production. They will, I think, do everything in their power—and we, when we are with them, will certainly do everything in our power to help them—to control this most difficult of all agricultural problems.

The Member States have accepted three directives from the Commission. I think my noble friend referred to them. The first is for farm modernisation, which corresponds roughly with our farm improvement schemes; the second is to introduce incentives to get farmers to leave their farms, which of course we already have. The third one is to give advice and training, corresponding to our advisory service—now so sadly thinned by the present Government. Fourthly, in the pipeline they have a scheme for encouraging the formation of groups, analogous to our support for a co-operative movement in production and marketing. These measures will hasten the reduction in the number of farms, farmers and workers on the land. The farming population at the moment is reducing by about 6 per cent. per annum, which, if you work it out, is quite a formidable reduction over several years at compound interest. The total number of people engaged in agriculture, forestry and fishing in the Community has fallen from about 15 million in 1960 to about 9.5 million in 1970. In the same period the number of farms has fallen by about 2 per cent. per annum and their size has increased by about the same amount.

There is nothing in these directives which need frighten us. We are already working according to them, in our own way. It looks as though by 1980 the Community farming problems will have been brought down to near the same level as our own and we shall be able to tackle them together without undue difficulty. If in the future we can see throughout the Ten, a prosperous agriculture standing on its own feet, if I may borrow the phrase, with each area producing what it is best suited to produce, prices may be regulated partly in relation to cost and partly in relation to demand; and I believe that the housewife, on whose satisfaction in the long run the whole thing depends, will be better off than she has ever been. This depends on a further rationalisation of agricultural structure, both here and in the Community. If we do not arrange it by Government interference it will happen spasmodically as a result of economic forces. The only thing one can do is to bend the economic wind and not legislate against it. This means a trend towards larger farms and fewer farmers. The present trend in the Community is in this direction, and this can do us nothing but good.

I could have given a very much more elaborate exposition on this complicated matter, but it would clearly have been totally inappropriate at this moment. I think we could leave it at the fact that the agricultural problems of the Community do not genuinely differ from our own. They differ in degree but not in kind. We have made great progress in tackling our problems, and naturally we were rather unhappy about switching from our effective system into their rather ineffective one. But they are now facing their problems realistically and they are using methods similar to our own. Prices are still too high, but a good deal of restraint is being shown in not letting them rise higher, and our cost-of-living rise is so enormous that the gap is closing. A prosperous agriculture in the Community, of which we shall be a part, must be to our own interest. We shall make a substantial contribution to this, it is true; but once we are in then prosperity is indivisible and we shall be helping ourselves. My Lords, I hope there is no Division tonight—

SEVERAL NOBLE LORDS

To-morrow!

LORD DONALDSON of KINGSBRIDGE

Thank you, my Lords. To-morrow. I hope that there is no Division to-morrow, because I do not want to vote against my noble friends, many of whom do not agree with me. But if there is a Division, I shall support this Bill to which I wish a happy passage with the fewest possible number of interferences.

8.50 p.m.

BARONESS TWEEDSMUIR OF BELHELVIE

My Lords, in a debate of this character, when we have at last come to the Bill which will give eventually the power to this country to implement the obligations of the Economic Community, we have had, perforce, to try to divide the responsibilities between those who will speak from this Bench. If I may say so, I thought that we had a wonderful start from my noble and learned friend who sits upon the Woolsack, who explained this Bill with such clarity to us all. Therefore, after that speech I will not attempt to try to answer in detail the very learned speeches which have been made by the noble and learned Lords, Lord Stow Hill and Lord Diplock, and also some questions on the legal aspects which were put by my noble friend Lord Massereene and Ferrard. Replies to them will be given to-morrow by my noble friend Lord Colville of Culross. I hope that that will be a satisfactory arrangement to those who are concerned.

The Parliamentary aspects of this Bill will be dealt with by my noble friend the Leader of the House, as will the questions on regional policy which are obviously of great importance and which were, in particular, dealt with at some length by the noble Lord, Lord Chalfont, and also with great feeling by the noble Lord, Lord Hale. This debate started off with a great compliment to the Government by the noble Lord, Lord Greenwood of Rossendale, who told us that it was a perfect Bill. How better could you start a two-day debate than that? But then he proceeded to cast gloom and despondency both upon the state of the United Kingdom and upon the Community as a whole, although he went so far as to say that he would not vote against the Bill if we had a vote. The noble Lord, Lord Greenwood, referred, in particular, to some important matters regarding the Commonwealth with which I should like to deal a little later.

But, first of all, I should like to say that the Bill, and, therefore, these debates, are concerned only with the changes within our domestic law that are needed to comply with obligations incurred under the Treaty and, therefore, to enable us to exercise the rights of Community membership. The provisions setting out these obligations and rights are contained in the Treaties and in the secondary instruments of the Communities, which were dealt with in considerable detail by the noble and learned Lord, Lord Stow Hill. However, many of the obligations require no change in our domestic law, notably those concerned with external affairs, including the remarkably generous terms that we achieved for the Commonwealth. By our accession to the Communities we shall have to place ourselves in the same legal position with the same rights and obligations as the present member States, subject to the agreed exceptions and transitional arrangements in the Treaty of Accession. Therefore, while I will not go into detail on this question, because that I will leave to the noble and learned Lord, Lord Stow Hill—

SEVERAL NOBLE LORDS

Oh!

BARONESS TWEEDSMUIR OF BELHELVIE

I am sorry, my Lords, I mean my noble friend Lord Colville, although I am sure that the noble and learned Lord, Lord Stow Hill, could do it beautifully—I am sure he knows the answers very well. I would say in a general way that there are three main categories of Treaties. There are the pre-Accession Treaties, which are set out in Part I of Schedule 1. The first six items are self-explanatory; these are the principal Treaties relating to the functions of the Communities. The seventh item includes all other Treaties entered into in a Community context before January 22 of this year.

So far as external relations are concerned, the pre-Accession Treaties include, for example, association and trade agreements with third countries, including many Mediterranean countries, and also the Yaoundé Convention covering the present Community's former dependent countries in Africa. I suggest that this serves to remind us that the Community we now seek to enter has very wide and important links overseas. The second category of Treaties is the Treaty of Accession complex itself. It is here that we find all the negotiating achievements, including those to safeguard the Commonwealth interests. For example, there is the Declaration of Intent for the developing Commonwealth countries in Asia, in which we and the Community have made clear our intention to extend and strengthen trade relations and to seek solutions to any problems which could arise after enlargement. My noble friend Lord Auckland specifically asked whether, in the Community developments which affect the Commonwealth, we will ensure that we consult Commonwealth countries in advance on Community decisions. There is continuing consultation with all Commonwealth countries in matters that affect our relations with them and, needless to say, this will continue after our accession to the Community.

My noble friend Lord Auckland (who bears that famous name from New Zealand) said that he hoped so much, particularly so far as New Zealand was concerned, that we would make sure that after 1977 matters which are of importance to New Zealand will also be dealt with in the same fair way in which they are dealt with now. This was also echoed by my noble friend Lord Massereene and Ferrard. The terms for New Zealand contain, principally, the continuing arrangements for New Zealand butter, which are not in question, and that is built into the agreement with the Community and re-affirmed in the New Zealand Protocol. Any decision to be taken in the future relates only to the detail of the continuing arrangements after 1977, and on this there has never been any dispute that a decision should be unanimous.

The noble Lord, Lord Greenwood, and one or two other noble Lords, referred to the vital sugar interests of the developing countries in the Commonwealth, which are at the moment protected under Protocols Nos. 17 and 22. I would remind the noble Lord. Lord Greenwood, that it was a Labour Government which in 1968 introduced the provision of the Commonwealth Sugar Agreement under which our obligations will terminate at the end of 1974. Their assurance to the Commonwealth was that they would seek to continue to fulfil the aims of the Agreement. Protocol No. 22 to the Treaty records the firm purpose of the Community to safeguard the interests of developing sugar producers of the Commonwealth, bearing in mind, and I quote: The importance of sugar exports to their economies. At Lancaster House, the Commonwealth countries concerned accepted that assurance and we have placed it on record with the Community. The Community were not represented at Lancaster House and were not asked to do more than take note; but it will always be our policy as members to see that this assurance is carried out on the basis on which it was accepted.

LORD SHEPHERD

My Lords, may I interrupt the noble Baroness, because this is a most important point? With regard to the Council of Ministers, there is the question of unanimity. Can the noble Baroness say whether in the event that we are unable to get unanimous agreement to the extension of the sugar agreements, it will be the intention of Her Majesty's Government to ensure the continuing growth of trade in Commonwealth sugar with this country?

BARONESS TWEEDSMUIR OF BELHELVIE

My Lords, I am sure that I can give the noble Lord, Lord Shepherd, the assurance that we intend to do the very best for continuing arrangements for the sugar-producing countries. If the noble Lord was raising the question of the Luxembourg Communiqué or the veto, that point will be dealt with by my noble Friend the Leader of the House when he winds up to-morrow.

LORD SHEPHERD

My Lords, I will accept the assurance given by the noble Baroness that the noble Earl the Leader of the House will deal with it. It was a matter which we raised in a previous debate. I hope that it will be dealt with fully because this is a matter which gives great concern in the islands of Fiji and Mauritius apart from the Caribbean.

BARONESS TWEEDSMUIR OF BELHELVIE

My Lords, I agree. This is why I sought to raise the question of sugar during this debate. Quite apart from the whole question of the unanimity rule, the convention, or the Luxembourg Communiqué, when we are entering into a Community of this sort we must, as some noble Lords have said, not instantly suspect that the worst will happen but we must believe that as partners we want to do what we say we want to do.

The third category of Treaties are those entered into after January 22, 1972, and which are for convenience referred to as the post-Accession Treaties. These will include the re-negotiation of the Yaoundé Convention and the Agreements with the non-candidate EFTA countries. Tile third category is dealt with in lines 5 to 8 on page 2 of the Bill which refer to future Treaties. These, like the pre-Accession Treaties, may be entered into by the Community together with the Member States as co-signatories or without them as co-signatories.

I should like here to deal with what we felt was one of the essential needs which we had to negotiate for our entry to the Community. That was the achievement of satisfactory arrangements to protect legitimate Commonwealth interests. In particular, I believe that we have achieved a generous range of options which were negotiated for the 20 Commonwealth countries concerned who have a great opportunity, if they so wish, to have links with the Community which suit their personal requirements.

There are three distinct options. The first is association under an arrangement to succeed the current Yaoundé Convention. This would be an economic arrangement, the backbone of which would be special trade provisions. The arrangements for the existing members of the Convention aim to establish a series of free trade areas between the Community on the one hand and the associates on the other in order to get rid of tariffs between them. It also provides for a generous aid programme.

The second alternative is association on the lines of the Arusha Convention between the three Commonwealth countries in the East African Community and the E.E.C. The third less comprehensive choice is that of a trade agreement. We will be in close touch with the Commission and the Member States in this particular period, because this is the period which leads up to the negotiations for new arrangements. We are doing our best to suggest to the Commonwealth countries who are eligible for association and also to the present associates that they should try to examine carefully now—because they still have sonic time —to decide which is the best choice for them.

There is a great opportunity here for the economic development of the African Continent for many generations to come.

I know that there are real anxieties about what association might mean in political terms, but while we understand why these exist we believe that they are unnecessary. The enlarged Community's policy will certainly be based on a relationship of partnership and equality with its associates. We expect the new associates to be treated in the same way as those who are associated now. That is why European unity can help to add a real drive towards economic development and stability on the African Continent as a whole.

We are very much aware of the problems of debt and also the importance of keeping fair market conditions for the primary products of these countries. So far as aid is concerned, those countries which become associated with the enlarged Community under the re-negotiated Yaoundé Convention will have access to the new European Development Fund in which Britain will play her part from 1975 onwards and also, on the best estimate that we can make, we shall be able, because of our expanding aid programme, to contribute to the European Development Fund without a decrease in what we now spend on bilateral or multilateral aid. I suggest to your Lordships' House that this adds up to a real opportunity for the economic advance of all Africa.

The noble Lord, Lord Gladwyn, who always gives us an interesting and thoughtful contribution, said that when the United Kingdom enters the Community we must be determined to make its institutions work, and work well. I could not agree with him more. It will be very much what we care to make it. It was agreed at the start of the negotiations, that the United Kingdom will have a position in the institutions equal to that of France, Germany and Italy. Of course, the Council of Ministers is responsible for final decisions of policy on all Community matters. The British Minister will always be present, together with representatives of other Member States. My noble friend Lord Merrivale asked whether statements would be made to the House by the Ministers concerned. I can say only that while no final decision has been made, I would think it most unlikely if British Ministers did not make statements to their own House.

The noble Lord, Lord Hankey, in particular, also referred to the great opportunity that we have to try to increase the work of these institutions. At the same time, he pointed out, quite rightly, that some people had considerable anxieties about sovereignty. I should have thought that in any real sense our sovereignty was safeguarded by the fact that all important decisions in the Community are taken by the Council, on which, as I have said, we shall be represented. Not only will our membership of the Council safeguard our sovereignty, but it will provide us, I should have thought, with a real chance to have some influence over the whole range of Community affairs.

As is well known, it is a recognised practice in the Council that no decisions are taken which conflict with the vital interests of a member State; and the main initiator of Community policy in those areas governed by the Treaty is of course the European Commission, whose members are nominated by member Governments. We in the United Kingdom will nominate two members to the Commission. Community policy is of course formed only after very careful consultations have taken place with every kind of interest in every country represented. This is done through management and advisory committees, on all of which we shall be represented. And, lastly, of course, there is the European Assembly which we believe has much important work to do in trying to influence Community policy. As the House knows, the United Kingdom at the present time will have 36 delegates out of a total of 208. At the moment they are designated by their respective national Parliaments. I have noticed with great interest the points put forward by some noble Lords that these particular delegates eventually should in fact be elected, and there is of course the Vedel Report which is being examined and which has some very interesting ideas on how these Communities could develop.

The nature of the Europe we are going to join seems to be very different in the eyes of many different noble Lords who have spoken this afternoon. The noble Lord, Lord Brockway, for example, hoped that this European Community would be an entirely Socialist community. The noble Lord, Lord Reay, said we were leaving nationalism and that Britain at last had a real chance to influence events upon the Continent. The noble Lord, Lord Gore-Booth, spoke with great experience of the changing nature of the Commonwealth. The noble Lord, Lord Chalfont, in what I thought was a very interesting speech, said he had spoken so much about it that he thought any speech on Europe was nothing hut a cosmic bore, almost as bad as the chess match. As I was lucky enough to see the opening of the chess match in Reykjavik, I can assure your Lordships that it was not a cosmic bore. The noble Lord, Lord Wigg, said that he had had seven Elections. So, I may say, have I; and therefore I do not share his concern that there should be a General Election at this moment on the question, which has been before this country for many years.

The noble Lord, Lord Hale, reminded us of that great meeting in The Hague, which I also attended—on the opposite side to him, I suspect. The noble Lord, Lord Greenway, I thought was halfway into Europe already when he gave us a description of his visit to Luxembourg. The noble Lord, Lord Gainford, spoke of the fears in this country—fears whether we will lose our independence and our identity, and even fears about industrial espionage. The noble Lord, Lord Brown, said, quite rightly, that there will be three to five years of real difficulty ahead. I am sure that that is so. He spoke also of certain specific problems, notably on Clause 9(5), which will be replied to tomorrow. The noble Lord, Lord Hankey, reminded us that we live in a brilliant Continent; and the noble Lord, Lord Sainsbury, said he hoped that we realised that what we are joining is still young and still evolving, and that we still have the chance to reform such matters as the Common Agricultural Policy.

The noble Lord, Lord Energlyn, to whom I always listen with the greatest interest because he enthralls one with his descriptions of thermal energy, said that he hoped we would try to do our best to consider how to get together in what he called a "Council of Energy". And lastly, the noble Lord, Lord Donaldson of Kingsbridge, made the 91st speech. In that he showed how in fact we can hope to influence the Common Agricultural Policy, and many other policies, because we will be there. That really is the difference between being a Member of the European Free Trade Area and being a Member of the enlarged Community. We shall he there. We can take a decision.

My Lords, I think there is no doubt that to begin with the going will be rough and it will be a test of what we in Britain really are; of whether we have the nerve and the character to meet the demands not only on our skill but also on our judgment. This Bill gives us a chance to influence the development of the European Communities, and with the rights and opportunities that go with it I believe that Europe, and Britain with her, will together bring power, belief and ideas to the world as a whole.

VISCOUNT COLVILLE OF CULROSS

My Lords, I beg to move that this debate be now adjourned.

Moved, That the debate be now adjourned.—(Viscount Colville of Culross.).

On Question, Motion agreed to, and debate adjourned accordingly until to-morrow.