HL Deb 17 June 1981 vol 421 cc647-723

Debate resumed.

3.56 p.m.

The Secretary of State for Foreign and Commonwealth Affairs (Lord Carrington)

My Lords, after that rather unexpected excursion down a Scottish cul-de-sac, perhaps we may return to the Motion before the House. My noble friend Lord O'Hagan reminded your Lordships that in two weeks Britain will, for the second time, assume the presidency of the Community's Council of Ministers, and obviously that will focus attention not only on what the Community does for Britain but also, I hope, on what Britain does for the Community. I therefore very much welcome the opportunity which my noble friend has provided for a debate on the advantages which Community membership brings to Britain, and I am grateful to him for his excellent speech. My noble friend is well known for the work he has done in the European Parliament and in this country for the Community and his dedication to it. I applaud him for that and I shall in this speech travel down much the same road as him, even sprinkling a few of the same statistics about.

I shall listen with interest to the two maiden speakers who will address your Lordships; at least I hope I shall, but I have a few commitments during the afternoon which I am afraid I cannot miss. However, I shall listen with great interest to them and shall be particularly interested to hear how they manage to make an uncontroversial speech about the Community.

I am also glad to have a chance of explaining why the Government remain firmly committed to making a success of Britain's membership of the Community. The Opposition has recently turned its back—if I can attribute so co-ordinated a motion to so disjointed a body—on the policies it pursued when in office; at least, I think it has, and I think it is proposing that Britain withdraw from the Community. I am sorry it should still be possible for us to be debating again, more than eight years after we joined the Community, the dispute about the very principle of our membership. I had thought that all of us, even Mr Wedgwood Benn, had accepted, after the referendum, that it was the decision of the British people. Anyway, in most other member states such a debate would be thought a pointless waste of parliamentary time. They see their membership as an indispensable part of their life, and I hope it will not be long before we too abandon this controversy and devote our energy to discussing what sort of a Community we want and how we can get it.

I have listened in vain in the last few months, and I suspect that I shall listen in vain this afternoon, for a comprehensible account of what the Community's critics want done, and of what their alternatives are. Frankly, what I hear is a discordant noise, not a policy. When it comes to telling us what they want, in my judgment they abandon all pretence to unity or consistency. Some want us out tomorrow; some are for a longer process. Some envisage us holding on in a sort of limbo in which we would be bound by the Community's rules without being able to influence its policies. Others, yet one stage further removed from reality, hope that we can influence its policies without being bound by its rules. Not one has put forward a constructive alternative to Community membership. Of course, that is not surprising, because there is not one.

I do not of course question the sincerity of the advocates of withdrawal—far from it. Lord Melbourne once remarked that nobody ever did anything very foolish, except from some strong principle. But I deplore their irresponsibility. However, having said that, I acknowledge that the benefits of Community membership are not properly understood or appreciated in this country. Recent opinion polls have shown the extent to which public hostility to Europe is based on ignorance. To take one example, I would point out that nearly half the people questioned in a recent poll believed that our contribution to the European Community budget was one of the two largest items in Britain's public expenditure. In fact it is one of the smallest. It is well under 1 per cent. of our total public expenditure.

The facts about our membership and the Government's European policies really must be properly understood, so that public debates can be soundly based on them, and not on a shifting tissue of myth. Well, we are doing what we can to make these facts better known; and that is another reason why I welcome this debate.

As we all know, the Community originated in the period of reconstruction following the Second World War. I suppose that after this length of time it is natural that some of us take for granted that Western Europe is an oasis of peace, stability and democracy in a troubled world. Perhaps we too often forget that rivalry between the countries of Western Europe has caused two devastating wars in the last 60 years. The Community arose from the wreckage of Europe after the second of those wars, because wise and farsighted men like Jean Monnet and Paul Henri Spaak were determined that Western Europe would not be responsible for a third world war. It is now inconceivable that any Western European country could pose a threat to another. But the economic and political co-operation that exists within the Community does more than underpin the internal stability and peace of Western Europe. It also provides an essential complement to our military co-operation with our allies in NATO, in helping to provide a cohesion and strength without which we cannot hope to maintain our security against external threats.

The Community can greatly strengthen our ability to promote our interests and our ideals further afield, not least in international negotiations, which in so many areas have become so important to us. Not even the most important European country could hope to speak with the influence that the Ten can exert when they speak with a single voice. This they have been doing with steadily increasing effectiveness, and now they are a force to be reckoned with over a wide range of international issues. The Ten have acted jointly over such crises as Kampuchea and Afghanistan, and they have pursued, and are pursuing, common policies on the Middle East at the European Security Conference and at the United Nations. I for one should like to see this process taken further.

The very existence of such a grouping of like-minded countries is a support for the principles of freedom and democracy. Its weight is increased by the fact that the member states between them account for over a third of world trade, and as my noble friend reminded the House, 39 per cent. of all aid to the developing world comes from the Community and Lomé—let no one underestimate the importance of the Lomé Convention—as against 20 per cent. from the United States and a derisory 1 per cent. from the Soviet Union. To a remarkable extent, the Community has become a pole of attraction to European countries in which democracy has recently been restored. The neutral countries seek close co-operation with us, and further afield so do groupings such as ASEAN, and those in the Middle East and Africa.

It is on the economic aspects of Community membership that its critics commonly concentrate their fire. I have already mentioned the strength that we gain from unity. It is nowhere more effective than in international economic negotiations, and the Community is now able to bring its full weight to bear in GATT and in many other international fora. But the Community also benefits directly our traders. Through our membership we now have an access to a home market of 270 million people in some of the world's richest countries. Well, perhaps we could have exploited more than we have done the opportunities that these markets offer and we must certainly do much more in the future. But already Community countries take 43 per cent. of our exports, against 30 per cent. at the time that we joined. Last year we earned a surplus of over £700 million in our overall trade with the Community. We also have duty-free access to the markets of the Community's associates, and these markets, together with those of the Community, account for no less than 60 per cent. of the total exports of this country.

I must say that I hope to hear how the supporters of withdrawal propose that we should preserve or replace those markets if we were to leave the Community, particularly since they are busily advocating the imposition of massive tariff barriers against the countries which are our main export markets. I am sad to see that the latest convert to this theory is Mr. Healey, who should know better—and indeed of course does know better.

Access to the Community's markets means much more to this country than just trade. It is vital in making this country attractive to foreign investors. I just do not believe that we would get most of that investment, with the jobs and resources that it brings, if we were not in the Community. Companies that set up in Britain are not looking just to our home market, but to the wider European market. As my noble friend reminded us, nearly half United States non-oil investment in Europe now comes to this country, compared with less than a quarter before we joined the Community. We are receiving about half of Japanese investment in Europe. Examples include the Nissan plans to build a major car factory, the Ford engine plant in South Wales, and microprocessor production in Scotland.

That is not all. Last year the European Regional Development Fund provided £136 million to industry in the assisted areas, and the Social Fund provided £50 million for employment and training schemes. The Community has developed policies to help and protect industries facing difficulties, such as steel, shipbuilding and textiles, and the ability to form policies on the European scale has been of real value in coping with, and containing, the problems of industrial decline.

My Lords, Ernest Bevin defined a central purpose of foreign policy as being able to go down to Victoria Station and buy a ticket to anywhere. I think the Community has contributed more to achieving this ideal than most, and I hope it will do better in the future. Those are a few—and I have named only a few—of the advantages of Community membership. But, of course, there have been disappointments—of course there have. Our trade has not increased as fast as many hoped; and we have had a real problem over our budget contribution. The situation we inherited two years ago was appalling, and was getting rapidly worse.

We set out to tackle the problem from a position of committed membership. We were confident that our partners would see the justice of our case, and they did—rather slowly, let it be said, but they did—and in the agreement reached on 30th May last year they showed their willingness to make substantial concessions. As a result, we have already received £645 million in refunds for the 1980 budget, with more to come; our position this year is protected, and the Community is committed to making similar arrangements tor 1982 if a lasting solution cannot be found by then. Above all—and this is really more important than all that—we have agreement to a fundamental review of the Community's budget, designed to prevent us or any other Community member ever again being faced with a similarly unacceptable situation. I shall have more to say about that in a moment.

The negotiations over our budget problem were long and difficult. We had to press our case hard in Brussels, as other member states do theirs—and we were right to do so. But there has been one unfortunate side effect, and that has been to add to the criticisms of the Community so widely heard in this country. I should like, if I may, to look at some of these criticisms. Broadly speaking, they fall into two groups: those which are largely based on myth and misunderstanding, and those which point to a real need for change and development. First, the myths. The Community is to the average Briton sufficiently remote and unknown to provide an ideal scapegoat for every misfortune, sometimes even including the weather. Moreover, the absurdities and public disagreements which inevitably result from efforts to accommodate widely differing national requirements make very good breakfast reading, and are sedulously reported by the press, while the Community's solid if sometimes rather unspectacular achievements are ignored.

Every season brings a little crop of Euro-myths. Most of them wither and disappear soon enough, but there are a few hardy perennials which may serve as examples of their breed. The most general and pervasive myth is that Community membership is somehow responsible for our economic ills. Our entry into the Community more or less coincided with the surge in oil prices which brought to an end a period of unprecedented growth and prosperity. The present worldwide recession affects everybody, inside and outside the Community. Its effects have been multiplied in our case by other factors—poor labour relations, low productivity and inadequate industrial investment. To blame this on to the Community is absurd. None of these problems has come to us from the Community; and, more important, none of them will be solved by us leaving it. The sooner we stop looking for an external scapegoat for our troubles the sooner we can put them to rights.

Another myth concerns the Community's institutions. The Community and the Parliament are widely believed to employ massive and greedy bureaucracies to undermine the sovereignty of our Parliament. In fact, the Commission employs rather less staff (under 9,000) than a medium-sized London borough council—Lambeth, to take a trendy example. Nor do the Community's institutions have the right to expand their own powers at will; and, again, I was sorry to hear Mr. Healey, who should know better and does know better, subscribing to this myth in a statement made when he spoke of, restoring the sovereignty of Britain from control by the Common Market". The fact is that the roles of the Community institutions are carefully defined in the treaties. The Commission proposes legislation and helps to implement it; the Parliament advises on proposed legislation, and has some very limited powers in the budgetary field. But it is in the Council that Community Governments jointly take decisions, for which they remain fully responsible to their own Parliaments. As a matter of fact, the activities of Parliament in Westminster have been widened by our entry into the Community, and in no sense have its functions or its powers been undermined.

But, of course, not all criticisms are misdirected. There are obviously areas where changes are urgently needed. First, as my noble friend mentioned, there is the common agricultural policy. It is obviously wrong to spend some two-thirds of the Community's budget on agriculture. Community farmers put too much effort into producing wasteful surpluses, and the Community spends far too much time in disposing of them. We want to sec this problem tackled in the course of the forthcoming discussion of the restructuring of the Community's budget.

But the common agricultural policy, too, has its myths. It is a mistake to hold it responsible, as many people do, for all the increases in food prices since we joined the Community. Something like 90 per cent. of those are attributable to quite other causes, such as inflation, developments in world markets and the need to provide our farmers with a reasonable income. Even the famous butter mountain is really a hillock. My noble friend's statistics were wrong: it is actually less than seven days' supply, not eight, for the Community. I think it is a pity that more people do not give the common agricultural policy credit for encouraging in Europe a healthy farming industry and a high degree of self-sufficiency, and for protecting consumers from the wilder fluctuations of world market prices.

The next area of weakness is obviously the Community budget. That, so far, has been the result of a haphazard succession of decisions on individual expenditure policies, and no thought has been given at all to its overall impact on member states. This has led to a current situation in which two member states, Britain and Germany, are financing the budget, while other countries, including several which are very much richer than we are, are major net beneficiaries. As I said, the Community recognised last year that this was intolerable, and the 30th May agreement greatly reduced the burden we carried. But it is only a temporary solution, and the Community agreed to make sure that similar situations did not recur.

What we have to do now is to find a lasting solution which would be demonstrably fair, not just to us but to all member states. Discussions on this subject are about to start and will continue during our presidency. The 30th May agreement charges us to do all we can to bring them to a successful conclusion this year, and this we must do. We shall have to look at the current balance of expenditure in the Community's budget, and in particular at the excessive share of agricultural expenditure. We shall have to consider developing new Community policies to shift resources into other areas, such as regional and industrial development, and retraining workers to meet the changing pattern of industry. But I am quite sure that if we are going to find a lasting solution for the Community as a whole, we shall also have to find a way of taking conscious decisions about the impact of the budget. That, I think, is the single most important domestic task that we have during our time of presidency, and I have no illusions about the difficulty of succeeding.

However, there are other areas in which we shall want to see progress during our presidency. One, obviously, is the common fisheries policy, which is of great importance to our fishing industry and on which agreement has escaped us for far too long. We shall be looking for progress in removing barriers to the free provision of services in such fields as insurance. We shall hope to see greater liberalisation of the air fares régime, and further easing of barriers to free movement and employment within the Community, for example, over frontier formalities and the mutual recognition of professional qualifications. We shall need to collaborate closely with the European Parliament.

We shall have to press ahead with our efforts in the Ten to contribute to the search for peace in the Middle East; and the events of the past few days will not have made that any easier. But, however difficult the problems, and however slight the prospects of immediate progress, we cannot afford to relax our efforts to find the ingredients of an ultimate solution.

I think that perhaps there is a growing feeling within the Community that the daily grind of negotiation in Brussels has been allowed to obscure some of the original objectives of the Community. We shall be trying to give practical expression to this feeling, and to lift our eyes, sometimes, from the fish and the butter, however important they may be, to the rather longer-term questions of the direction in which the Community is travelling. Some of my colleagues over the past months have put forward some ideas on this; and so have I, in particular on how we might improve and strengthen the system of European political co-operation. There will be, I think, differences of emphasis, but I am quite sure that all of us are ready to work on the same lines. We need to give a new impetus to the Community, to give it a meaning with which its citizens can readily identify, and to consolidate the habits of co-operation and consultation which have been, and are being, so successfully developed.

I am in no doubt at all that that is the road along which the future of Europe lies; that is, by shaping and building the Community so that in the long term we can ensure our security and our prosperity. We remain, as we have been for most of our history, indissolubly linked to those of the neighbouring countries who are our partners in the Community today. We have a choice before us. Either we can devote ourselves wholeheartedly to making the kind of Community which corresponds to our hopes, our wishes and our interests, or we can, as the Opposition seem to be suggesting, just get out and leave to others the construction of Europe and the determination of our national future.

Surely it is obvious that the second of these courses would be the real forfeiture of sovereignty. I hope that I have been able to convince your Lordships today that the Community has benefits which far outweigh its disadvantages and that the only right course is to strive to strengthen and improve it. That is the task which the Government have set themselves; and we shall pursue it with vigour.

4.24 p.m.

Lord Bruce of Donington

My Lords, we on this side of the House, as the noble Lord, Lord O'Hagan, has already mentioned, look forward to the participation in this debate of my noble friend Lady Ewart-Biggs and also my noble friend Lord John-Mackie. I, myself, have not had the pleasure before of ascertaining their views by listening to them in debate and I only hope that, subsequent to this debate, I shall find their reactions to what I have to say just as agreeable as I would hope on a non-controversial occasion. I am particularly grateful to the noble Lord, Lord O'Hagan, for putting down this Motion for debate. I am grateful, first, because it has given us the opportunity of listening to the noble Lord again. The noble Lord is one of a devoted band of European Members of Parliament who have done their best under the most appalling and frustrating circumstances to make the European Community work in the manner that they and I apprehended that it ought to work.

The second reason that one is grateful to the noble Lord is because it gives us the opportunity of listening to the noble Lord, Lord Carrington, the Foreign Secretary, who has an enormous prestige in this country and, indeed, is always regarded by us on this side of the House, whatever we may feel in the heat of controversy, as a friend of democracy and a person who expresses his own views sincerely and clearly. We should like to offer our felicitations to him during the forthcoming presidency for six months of the European Community and, if I may add my sentiments to theirs, may I wish him well during the six months that lie ahead in some of the arduous duties and travelling that undoubtedly he will have to undertake during that time.

As the noble Lord reminded us, the personnel employed by the Community are rather less than the famed Lambeth Borough Council. This must be so because the function of the Community institutions as such and of their staffs is the co-ordination of the actitivities of the member states that come within the geographical area of the Community itself. It is important that we should realise this because, unless we are careful, we tend to regard the institution of the Community as being something intrinsically permanent in itself; we tend to regard the EEC as a theme whereas, in fact, in the main it consists of the co-ordinated efforts of all the member states that belong to it. We are not therefore really concerned when we argue about the pros and cons of the EEC; we are not arguing about the merits of the institutions, what we are talking about is the welfare of the people, of the countries, that comprise the states that belong to the EEC. For that reason, such statements as, "should we be in Europe or out of Europe or in the EEC or out of the EEC?" give a wholly misleading impression.

Whatever happened to the position of this country and of its Government in its relationships with the various countries of Europe regardless as to how those arrangements may change or how they may be modified? Old Father Thames would still go rolling along, the English Channel would still continue to be there and is likely to remain so in the absence of a renewed ice age; and the people of the various countries in Europe, including our own, regardless of what happens to the organisational changes that inevitably happen in the way that European co-operation is carried out, will carry on their lives exactly as before with very little change. So it is wrong to give the emotive pressure of "in" or "out" of the EEC or "in" or "out" of Europe. I willingly agree that the steps that one takes in trying to evolve those measures of co-operation in Europe are essential to our survival and future rather than regard them as something physically catastrophic which can be termed either "in" or "out".

The fact of the matter is that the whole concept of co-operation in Europe must rest fundamentally on our considerations of what happens to people, not what happens to institutions as such, because institutions are bound to change from time to time. As the noble Lord, Lord Carrington, pointed out, the EEC itself is one of quite a number of organisations that have grown up to promote harmony and co-operation in Europe. The EEC is not particularly unique in this respect. There is, for example, the Organisation for Economic Co-operation and Development, which was founded in 1948 or 1949. That comprises practically all the countries of Europe including those belonging to the EEC and now includes Australia, New Zealand, Japan and Canada; and Yugoslavia is also a participant in its activities as is the United States.

The work carried out by the OECD is vital to the future of Europe. I was glad—as I am sure your Lordships will be—to note that M. Claude Cheysson, who was well known to me personally when I was a Member of the European Parliament, has taken an early opportunity of making known certain views generally held within the OECD countries to the USA concerning the control or otherwise of the rates of interest.

Then there is the Council of Europe. That is also an organisation concerned fundamentally with the same kind of things to which the smaller number of members belonging to the European Economic Community address themselves. It includes representatives from some 16 countries including the Nine or the Ten but going beyond those into Austria, Norway, Sweden, Switzerland, and so on. These additional countries in the Council of Europe are not the other side of the pale because they do not happen to belong to the EEC. No reproach need be directed to them because they do not so belong.

The North Atlantic Treaty Organisation comprises some 14 or 15 countries, including, Canada, United States, Turkey, Portugal and Norway and the countries included in the EEC, with certain reservations applicable to France. This is another organisation in which we play a vital part and which is deemed to be necessary to ensure that continued co-operation in the defence sphere continues in Europe alongside the efforts of the EEC. The Western European Union now consists just of members of the EEC. They meet together now and again to discuss certain specialist political questions and also possibly defence. Finally, we have the European Free Trade Association which is composed of the other countries of the Council of Europe, by and large, but they are not members of the EEC.

The reason that I have mentioned these organisations is that we review the European setup as a whole. May I clear your Lordships' minds initially since the noble Lord, Lord O'Hagan, probably had some doubts about my fealty? I do not believe in opting out of Europe; but that does not mean of necessity that I must remain eternally allied to every individual organisation promoting unity in Europe regardless of its performance. The value of this debate is that it gives us the opportunity of reviewing, after a period of nine years, the position of our own country in relation to the EEC. On some future occasion—it may depend upon the usual channels—we might have the opportunity of reviewing our position within the OECD. We might have an opportunity of reviewing our position within NATO; we might have an opportunity of reviewing our position within the Council of Europe.

I willingly concede that in its present impact upon the individual citizen of the United Kingdom, a review of the EEC is obviously of much more importance since the flow of directives and regulations coming from the EEC, the very fiscal trade and other measures that it adopts, has an immediate impact and an ultimate impact on the individual citizen of the country.

Therefore I put it to the noble Lord—because I am quite sure that he would not wish to be unfair to me any more than I would be unfair to him—that because we call into question the position of this country in relation to an organisation for European unity that it joined some 9 years ago he should not take this amiss, nor should he assume automatically that one is bent on either criticising or destroying it. It may well be that the EEC as an organisation is very suitable indeed for certain countries having certain characteristics and in certain geographical situations with varying economic potentials.

It is not, therefore, my purpose—and I hope that the noble Lord will take it from me—to pour criticism upon the EEC as such. I personally have derived great benefit from it in the sense that it has given me and, through me, members of my party, opportunities for participating in the day-to-day political, economic, fiscal and other discussions with peoples of different nationalities. Of course, it increases one's breadth of mind and knowledge of the way the European spectrum works. Obviously, in that sense one's association has had great advantages. I willingly concede also that in some aspects of the EEC's activities particularly, as the noble Lord, Lord Carrington, has mentioned, it allows greater muscle in negotiating trade agreements with the United States in representations at GATT and so on. Obviously it carries greater muscle than would be carried by individual countries. All that I agree with—

Lord Carrington

My Lords, I wonder whether the noble Lord would allow me to intervene. I am not quite sure whether he is saying that the Labour Party are not committed to withdrawing from the Community or whether they are, because I was reading and I have in front of me a statement made by Mr. Michael Foot, which actually says he believes that there should be a repeal of the European Communities Act 1972.

Lord Bruce of Donington

My Lords, the noble Lord must realise that I know he is an old political hand in these matters, and consequently I shall not respond to his invitation to reply to that point at this stage but shall make my own speech in my own way. He must not expect me to fall for that one. All I am saying for the time being—

Lord Duncan-Sandys

My Lords,—

Lord Bruce of Donington

My Lords, I am being very hospitable to the noble Lord and to the noble Lord, Lord O'Hagan. I have pointed out greater advantages than the noble Lord, Lord O'Hagan, himself mentioned in his opening speech. In fact, his speech contained very little reference to advantages; all it sought to do was to play upon fears as to what might happen if we did not come in. I have been generous to the noble Lord. There are advantages: I willingly concede that. But of course there are certain disadvantages, and these disadvantages have to be taken into account. I am really talking about disadvantages so far as the United Kingdom is concerned, which is what this Motion is about: it is not concerned with the merits of the EEC as such. It is the association of Britain with the EEC that we are discussing.

I thought the noble Lord touched rather lightly on the fiscal disadvantages. He referred to the fact that they became aware of the situation when they took office in May 1979. I was a little rueful about that because at least two years ago in your Lordships' House I was almost howled down—or at least as near to howled down as this House can howl anybody down because it is so polite—for even suggesting there was likely to be a deficit; and I am in the recollection of the House of the reception accorded to my predictions at that stage that we would soon be facing a deficit of £1,000 million. In fact, so far as the Members of your Lordships' House can be impolite, I think it is fair to say that I was greeted with a mild derision that bordered upon the laconic. So there can have been no ignorance; but even so I thought the noble Lord dealt lightly with it.

After all, the cumulative budget deficits net, after all contributions, after all receipts by this country, from the Social Fund and the Regional Fund and after every conceivable benefit received direct from the Community is taken into account, after making allowance for research and development and all these things, we incurred out of our Exchequer during the years 1973 to 1980 no less than £2,907 million—I wish I had the noble Lord, Lord Cockfield, here!—which all had to come out of the public sector borrowing requirement and therefore carried interest. There has been some disposition to minimise this sum. I asked the question at the time and I ask it again now: for what did we pay £2,907 million in the years 1973 to 1980, and for what reason are we to pay net into the Community over the next two or three years approximately at least £500 million per annum out of the public sector borrowing requirement? I repeat, why?

Lord O'Hagan

My Lords—

Lord Bruce of Donington

What return do we get for it? I will give the noble Lord an opportunity presently. Do not let us talk of this thing lightly. The Government at the present time are going into paroxysms of activity to cut Government expenditure. In fact I believe that the noble Lord was at a meeting today—I do not know whether he was there or not, but according to The Times there was to be a meeting this morning at which there was to be some disputation between those of varying degrees of humidity, the wets and the other ones, as to whether there should be cuts or not. It is not right that we should deal with these cuts with frivolity. Five hundred million pounds is £500 million, and we say that is trivial. Ministers, when they talk from the Dispatch Box and deal with the provision of school books, the provision of kidney machines or the necessity for economising on school meals, school transport and all other kinds of social services, take this small number of million pounds very seriously. Then why cannot the £500 million deficit be taken seriously? I am well aware that the noble Lord intends, as part of the discussions that are going to take place, to try to obtain some budgetary reforms. I speak with the—

Lord O'Hagan

My Lords, the noble Lord has been very kind to me and I shall try to return that in good measure. I do not quite follow, though, why he blames the present Administration for deficits that occurred under the previous Administration, and why he pays no attention to the reduction in our net contribution achieved by the present Government. These two points seem to me to be somewhat contradictory, and to depart from them, as he has done, down the by-ways of expenditure he has mentioned surely has very little to do with the Community.

Lord Bruce of Donington

My Lords, to make the position quite clear, may I say right away that congratulate the Prime Minister on obtaining a refund of some of the net contributions we have made. That puts it immediately behind. I think she did much better in that than my own Government did before she took office; so let there be no mistake about that. There can be no doubt, but I was not discussing that. I was discussing the existence of the deficit after all the refunds had been obtained and the apparent indifference that the existence of this deficit exerts on the minds of the Government—so much so that they do not even conceive it to be a disadvantage.

I pass from that to the question of trade. We have to judge our position in the EEC in relation to trade—it is after all a European Economic Community—and one of the principal reasons why we went into it was stated at the time—I will not weary the House with the quotes—to be because it would provide a dynamic stimulus to our manufacturing industries and that we should have a mass market in Germany, in France and in all the other EEC countries. It was said that that would stimulate enterprise, drive, thrift and all the other virtues, so that we should undoubtedly prosper from the manufacturing industries' point of view. I do not say that was a promise; it was a prospect that was held out at the time and one that was formulated honestly. And when we are discussing these questions we are all trying to peer into the future as far as we can, we are all bound to have different ideas as to which way the future is going to go and we are bound to argue and discuss these matters.

That was the prospect, but instead of that what we find is that whereas in 1972 in manufactured goods we had a surplus of exports over imports of some £25 million, in 1980 we had a deficit in manufactured goods in terms of imports over exports amounting to £1,719 million. The peak had been reached the year before, with a deficit in manufactured goods of £2,721 million. So that, whereas in 1972 79 per cent. of our manufactured goods went to the EEC and only 65 per cent. of our manufactured imports came from there, in 1980 our exports of manufactured goods had sunk to 66 per cent. and our imports, expressed as a percentage of our total imports, had risen to 74 per cent. These are figures which are quite unassailable. That is another disadvantage.

The other disadvantage must, of course, be the common agricultural policy—

Lord Northfield

My Lords, before my noble friend leaves that issue, should he not examine the disaster that would face this country if we did not have that access to that industrial market? It is no good saying that our deficit has increased. What one also has to look at is the total disaster that would be facing our industrial economy if we did not have that market.

Lord Bruce of Donington

My Lords, I am grateful to my noble friend. I have not yet come to the alternatives. Do not wince before the lash falls. I am discussing the position purely as it is now.

In regard to the CAP, I shall not weary the House by repeating some of the very pungent statements that have been made by the noble Lord, Lord Carrington, about the common agricultural policy, although I am bound to do so if I am challenged. I can, however, inform the House that the Prime Minister, no less, described it as insane and I cannot bring myself to dissent from that. But the fact of the matter—and it was recently confirmed in the Economist—is that it has, after all, added an extra 10.2 per cent. to our cost of living bill.

Are these advantages or disadvantages? If they are disadvantages, then our attitude towards this aspect of the matter must be dictated by the extent to which we believe that these things are likely to continue. Are we likely, as a result of our association with the EEC, to continue to have these disadvantages, which are not caused by the EEC itself—nobody is attacking the EEC itself—but caused by our own relationship with it?

The noble Lord, Lord O'Hagan, will, I am sure, confirm that when he was a Member and, certainly, during all the time that I was a Member of the European Parliament—and it is the same now—we had continued promises of a reform of the common agricultural policy. It has been on the agenda of every Parliament, at any rate in the four years when I was there, and certainly, on reading through the noble Lord's history, it was there then—and it is there again.

I would assert—and I invite the noble Lord to rebut it—that there is no chance at all of any fundamental change in the common agricultural policy, because that would require the unanimous consent of the Council of Ministers and unanimity on this issue would be impossible to get. The same point applies also to the budgetary provisions. Is there going to be unity there—

Lord O'Hagan

My Lords, I am sorry to interrupt, but the noble Lord made some very strong declarations. May I put this in the form of a question to him? Does the noble and learned Lord wish to speak?

Lord Elwyn-Jones

My Lords, may I venture to suggest that the noble Lord is going to reply to the debate. He has made an admirable opening speech of over 20 minutes, and there are 24 more speakers to speak.

Lord Bruce of Donington

For that reason, my Lords, I shall bring my remarks to a conclusion very quickly, but not before I have given the House my views as to how we should proceed, which is something the House would expect of me. I do not hold the view that there is no alternative. The noble Lord has said more than once that there is no alternative, but if humanity had adopted that principle in regard to everything in which we have progressed over the last thousand years, we would have made no progress at all.

The whole of progress depends upon finding alternative methods of doing things; alternative technologies, alternative forms of political organisation and so on. It would be a completely defeatist policy to say that there is no other way. I put it to the noble Lord as gently as I can that the statement that there is no other way must be regarded as complete nonsense. There are bound to be other ways. There are bound to be ways which we ourselves have not so far thought out.

But the alternative that I would put before the House is that we should progressively, in an organised fashion and in agreement and negotiation with our colleagues in the EEC, opt out of the EEC and back into Europe, to take part there within the broader spectrum of the European movement, the broader spectrum covered by the organisation of economic development and research; to take a greater part in the Council of Europe; to play our full part in NATO; and, above all—not on the basis of empire, to which the noble Lord, Lord O'Hagan, referred—to seek once again within the modern context, and bearing in mind the whole implications of the Brandt Report, for a closer and preferential association with our Commonwealth.

These are the constructive suggestions that I make. I cannot pretend that they will commend themselves to all Members of your Lordships' House. I hope, however, that they will commend themselves in one sense, in that they are meant with sincerity. They take no barb with them. They are not two-faced. They are not for sale. I believe, however, that this House and the country will eventually take the course that I have the honour to suggest to your Lordships this afternoon.

Lord Shinwell

My Lords, may I ask my noble friend this question? On the assumption that it is possible to secure substantial reforms along the lines that the party to which we both belong has ventured to suggest from time to time, and in view of the fact that a referendum taken in a democratic fashion decided that we should enter the Common Market, would it not be better to try to get more out of the Common Market and accept the implications of the Common Market, so that there is unity in Europe? Would that not be desirable?

Lord Bruce of Donington

My Lords, with the leave of the House, if I were convinced that by continued membership in its present form we could have the particular economic and budgetary disadvantages removed, I should still want one further thing, which I think is vital, and which I have had no time at all to touch upon, and that has to do with the role of the European Parliament itself. The European Parliament's powers have been progressively restricted. They have not been enlarged. They are denied even the right to make suggestions that were put forward by M. Tindemans. They have no powers whatsoever. Indeed, I have the papers of the European Parliament in which their full grievances about these matters are outlined. If, therefore, there is to be a dynamic EEC, then the directly-elected Parliament must have powers and those powers must be progressively enlarged. But I do not believe there is the remotest intention by the Council of Ministers of doing so.

Lord Duncan-Sandys

My Lords, before the noble Lord sits down, may I ask him to make clear whether or not he supports the policy of his party to withdraw from the Community?

Lord Bruce of Donington

My Lords, my party's policy on withdrawal or otherwise from the EEC has not yet been published. As soon as I have a sight of it and am able to assimilate it and make a judgment upon it I shall be quite willing to come back to your Lordships' House to defend or to attack it as I think right in all the circumstances.

Lord Duncan-Sandys

Sitting on the fence!

5 p.m.

Lord Gladwyn

My Lords, it is a good thing that the noble Lord, Lord O'Hagan, has raised this question today, partly because, as has been said, it conies on the eve of the British Presidency of the Council of Ministers—and it may be useful for the Government to have the views of this House before that starts—and partly because it is the fashion now to attribute all our ills, notably unemployment and inflation, to the Common Market. The Labour Opposition seem indeed to feel—as is made clear from the speech of the noble Lord, Lord Bruce of Donington—that the EEC is almost as responsible for our present ills as are Mrs. Thatcher's economic policies. Labour's remedy, as we all know—it has not been denied by the noble Lord, Lord Bruce of Donington—decided in solemn conclave last October, is to leave the Community (most of them would think as soon as possible) and then necessarily, as I shall proceed to argue, to go in for what can only be described as nationalistic socialism: import controls, more nationalisation, capital levies, unilateral disarmament, a greater increase in bureaucracy—in a word, something which can only be put into effect by what is commonly known as a directed economy.

Things will not go on, as the noble Lord, Lord Bruce of Donington, suggested, just as they are—no great change, the Thames going on flowing, nothing much happening. On the contrary, everything will be changed, and for the worse. Let us hope that we escape this fate, as I believe we shall, if only our people can be persuaded that the disadvantages of membership of the EEC are nothing like what they are made out to be by the anti-Marketeers, while the advantages are real and enduring.

Let us first consider the disadvantages, or the alleged disadvantages. When we joined the EEC in January 1973 the slump had not yet started. The accepted wisdom of nearly all economists was that "growth" would inevitably continue from year to year, resulting, among other things, in fewer people being employed on the land and consequently in a diminishing British contribution to what was always known as the Agricultural Fund. All these assumptions were vitiated by the world recession, and it fairly soon became clear that we were, on balance, paying much too much into the Community budget. Nobody denies that. That we should be paying proportionately more than France—I say proportionately more—was, however, accepted by us with open eyes during the negotiations, seeing that France had, and still has, a real social problem in her numerous small peasant holdings and that, like the Germans, we stood, as we thought then, in principle to gain a great deal, indeed much more than France, from the huge new markets for our industrial goods.

The slump, which was not our fault nor that of our partners, has put paid to many of these hopes. Successive negotiations have resulted for the time being in what I think is a not unreasonable net British contribution to the budget. This of course is subject to negotiation, but I regard it as not unreasonable and anyhow it only represents a tiny fraction of our GNP. Its effect can therefore be greatly exaggerated.

It is also becoming clear to all that the CAP, which was referred to by the noble Lord, Lord Bruce of Donington, so disparagingly, was devised in very different circumstances and is in need of drastic reform. Of course it will be reformed, whatever the noble Lord may say, because otherwise, more especially after the accession of Greece, the Community will run out of money with which to finance it. Therefore, whether Ministers like it or not, in the next year or two they will have to reform the CAP. And when it is reformed, the whole budget will necessarily be restructured, too.

Let us take our commercial exchanges. I shall not dwell on that because the noble Lord, Lord O'Hagan, and the Foreign Secretary referred to it, as did the noble Lord, Lord Bruce of Donington. It is a fact, which is not denied, that now about 60 per cent. of our total trade is with the EEC and with the European states associated with the EEC in Europe. That is in itself an enormous proportion of our trade. For some years this produced a large and, I admit, a worrying deficit. That was to some extent due to our initial failure, largely owing to industrial troubles of one kind or another, to seize our opportunities. However, even without the income from oil, our exchanges, I am told, are now approaching parity, if we take them as a whole, and constitute by far our most important market. Why this is represented as a liability by the anti-Marketeers is something of a mystery. Rather it is an enormous and a growing asset.

There are, if we are to go on about the disadvantages, disputes involving various interests in which, quite properly, we keep our end up, or try to, such as those concerning what is now called sheepmeat and fish. Lamb seems to be more or less settled, although there are rumours that this dispute is going to come up again. But no doubt it will be settled in the near future. However, fish is a difficult question to resolve. Few people doubt, though, that it will be resolved, for it is quite evident that agreement is in the general interest. Fish has been played up by the "antis" for all it is worth. We have heard nothing else in the last few months. And it is played up as something which proves that we should be better off outside the Community. If, however, all concerned with the problem stick firmly to what they believe to be their vital interests, then there can be no settlement. And if there is no settlement, eventually there will be no fish. It is as simple as that. Leaving the Community is not therefore likely to be of much help to our fishermen, whose terrible and admitted difficulties, with which we all sympathise, are primarily due to the establishment of the 200-mile zones and the consequent disappearance of many of their main sources of income. But this has nothing whatever to do with the EEC.

There are also a number of what might be called irritants—one or two have been referred to—some of which, however, are pure illusions, such as the belief that our adoption of the metric system was due to the machinations of bureaucrats in Brussels. These are often the result of well-meaning efforts to harmonise the various economies which nevertheless ought to be harmonised in principle to some extent—for instance, company law—if any collective effort to establish ourselves in the world market is going to succeed. But many of them, such as the famous Euro-beer, were simply figments of the imagination. And who hears any longer of the horrors of the tachograph, or the "spy in the cab"? We have not heard about that for a very long time. It may be that there is too much form filling—I would not deny that—but it must be realised that the much-abused Commission only operates on lines which have already been laid down by the Council of Ministers upon which we are ably represented. All these irritants are in any case likely to disappear rather than to become more acute as time goes on.

What else is there in the way of evils which can be attributed to membership? I suppose that in a general way surpluses, notably of butter and wine, all suitably played up by the "antis", have persuaded most people that we should be better off outside the Market. Apart from the fact that some sort of reserve of "buffer" stocks is a reasonable feature of any common agricultural policy, however it is organised, the often admittedly absurd results of the present system are something which even now is being mitigated. Besides, however regrettable, it has only a tiny adverse effect on the pocket of the British taxpayer, when we come to analyse it.

To sum up this part of the argument, while there are certain real economic disadvantages in membership of the EEC—and I would not deny that—these can all be put right as a result of continuous negotiation. This is not to say that everybody will necessarily get better off as a result of Community membership: our standard of living depends primarily on world conditions, such as the price of oil, and no doubt our own policy has a good deal to do with it, too. But it does mean that we can still do much to preserve our standard of living by means of collective action. People seem to forget that the whole system is not something which is static—even the noble Lord, Lord Bruce of Donington, said something to that effect—and therefore must be condemned because certain features seem at the moment to be objectionable. It is rather a living entity which is subject to change, resulting in perpetual clashes which have perforce to be settled by democratic means in the general interest. The real question, therefore, is: does this general interest exist and, if so, how can it best be promoted?

That there is a general interest—and that this redounds to the advantage of all members of the Community—I should have thought has been demonstrated by the mere course of events since 1958, when it was started. The great internal market which now exists and accounts for nearly half our trade with the Community would clearly not have existed without it; that is to say, without the Community's ability to negotiate collectively on such important matters as tariffs, quotas and, indeed, without its capacity at least to take the agricultural factor into account. For that must be taken into account. A simple industrial free trade area could not possibly have achieved so much. True, impediments to free trade still exist, but they will eventually be eliminated, more especially as we advance towards a common monetary policy—and I believe while the pound is hovering around two dollars it would be well in our interests to join the common monetary system as a first step. Nor can a customs union embody such elements as the Regional and Social Funds which, however embryonic they are now, will certainly be developed as things go on, and provided, of course, that the Community does not break up.

Then, as the present Government quite rightly declare, and as the noble Lord the Foreign Secretary never fails to emphasise, there is the Council of Foreign Ministers and the European Council which do arrive at a common attitude and occasionally even a common policy on many grave matters affecting peace and war. If only they could create some more suitable machine for a better co-ordination of views at the right moment and, as I think, face the fact that defence and security are obviously an integral part of foreign policy, they would achieve very much more.

Last, but very much not least, there is now the directly-elected European Parliament which is where, with luck, the great and necessary compromises—despite what the noble Lord, Lord Bruce of Donington, may say or think—between national and collective interests will one day be hammered out. Your Lordships may have seen that only yesterday they hammered out some kind of proposals for the reform of the common agricultural policy which I hope will be of considerable use when the Ministers consider that thorny question in the next few months.

Apart from all that, I should have thought that it was almost self-evident that, in the present dangerous state of the world, the small and medium-sized democracies of Western Europe should at least do everything possible to concert both their internal and their external policies and, so far as practicable, to "speak with one voice". I believe that this objective is firmly held by the new French Socialist Government, and I can only hope that those excellent people will proceed to convert their colleagues in the Labour Party and get them to revise their present views. For, if we fail in this objective, not only will the two superpowers be left in a kind of dangerous and lonely confrontation, but the reversion to economic nationalism and consequently to industrial protection on the part of a dozen states in this small promontory of the Asian landmass will, if only by reason of the fall in the standard of living due to the imposition of directed economies, inevitably endanger the existence of free societies in this part of the world.

If that is accepted, then the next question—I only have a minute or two left—is whether the present Community is the right kind of instrument for reaching this self-indicated end. If we discard the idea of a simple alliance—why have an alliance when you have NATO?—it would clearly not result in any kind of unity. Broadly speaking, therefore, there are only two possibilities; one is a federal state, more or less on the lines of the United States of America, but very few today think that this would be possible, even if it were desirable. The other is surely the development and elaboration of the existing system which, after all, has the merit of having persisted for about a quarter of a century. This system, as we all know, is partly supra-national. That is what distinguishes if from an alliance or even from a customs union. But the sad fact is that unless the supra-national element is gradually—I stress, gradually—extended, the Community may not be able to withstand the stresses and strains imposed on it by world conditions and may therefore always be in some danger of collapse.

What are the supra-national elements already inherent in the treaties—not therefore requiring treaty revision—which must now be developed lest worse befall? In a word, they are (a) a decision by the Ministers to take more and more important decisions by qualified majority vote; (b) some reform of the Commission with a reversion to some of the original powers bestowed on it by the Treaty of Rome itself, which would mean, I suggest, some diminution in the powers of the Committee of Permanent Representatives in Brussels, and (c) above all, perhaps, an increase, if not in the legal powers, at any rate in the influence and importance of the European Parliament, where, as I have said, alone the forces behind a free and democratic community will be able to assert themselves over the narrow influence, however justified, of the various nation states.

Yet, my Lords—this is my final word—even though this may be thought in some way paradoxical, it is only if we, while accepting certain restrictions on our absolute freedom of action, remain a nation state conscious of ourselves, only if we remain, therefore, a United Kingdom, that the new system is likely to work as it should. Whatever the need for devolution (and of course there is a need for that) we British should remain together in order to influence events, as we can, both in the Community and outside it. We may, as the poet says, have to some extent been made weak by time and fate, but we must also remain strong in faith, to strive, to seek, to find and not to yield.

5.19 p.m.

Baroness Ewart-Biggs

My Lords, I am deeply conscious of the privilege of addressing your Lordships' House for the first time but nevertheless I must admit that the great pleasure that I feel in making my contribution to this debate is somewhat tempered by the sense of awe that the occasion gives me. However, if I have learned one thing since taking my place among your Lordships, I have learned of the spirit of tolerance, courtesy and indulgence which characterises your Lordships' House and I gratefully recall that now.

In my view, the subject of this Motion is of very great importance. The United Kingdom has been a member of the European Community for over eight years and this is a moment for taking stock. It seems entirely appropriate that, while Britain takes her place in the presidency for the next six months, we should stand back and ask ourselves what has happened during that time, and where it has led us; whether the aims of the founders have materialised, either fully or in part, or not at all. It is at this point, my Lords, that I will dare to reminisce for a moment.

It was in the years 1969 to 1971 that a Foreign Office posting took my husband and me to Brussels, where, as a diplomat's wife, I found myself at least on the periphery of that group of people, civil servants, diplomats, politicians, who, with Britain's interest at heart, were negotiating terms for her entry into the Community. At the time the options were, as we all knew, to remain faithful to the economic and emotional ties to the Commonwealth, or to integrate with our European neighbours. These were people whose lives were deeply involved and committed to forwarding international relations and co-operation. Arriving late, as they did, at the negotiating table, with so many of the rules already made, the prize of successful negotiations was great; but the basis of their hope, on which all else hung, was that the Community would not only constitute a powerful force for peace and provide a forum for collectively finding solutions to common problems, but also through political co-operation be able to influence world affairs by speaking with a united voice.

I remember how one of them put it at the time, describing how he saw the way forward for Europe. There are three areas", he said: first, that of the interests which the Community countries have in common; secondly, the area in which an effort and some measure of sacrifice is needed; and, thirdly, the area in which our interests and institutions are so different that there is, for the present, no possibility of reaching common positions. By the habitual and repeated process of seeking compromise one can hope to extend the first of these areas into the second, and the second can slowly encroach upon the third. It is in this organic fashion that the system will grow. The process must be pragmatic. But there must be a constant will to move forward, a sense of the dynamic". So now we wonder what has actually come of this vision. It would seem that the intractable problems have sometimes obscured the areas of agreement. There is unequivocal evidence that unforeseen outside forces have slowed down the process of European integration. The unprecedented rise of energy prices and the world recession have not only brought a tragically high level of unemployment to the industrialised Western European countries but also thrown into sharp relief our failure to find a balance to the Community budget, and our failure to create international co-operation between the rich and poor countries for the benefit of both. These evident disappointments have, for some of us, called the whole idea of the Community into question. And it is often thought that membership of the Community can only exacerbate our grave economic problems. But, my Lords, as the poet said, "If hopes were dupes, fears may be liars".

Above all, there has been a fear that the common agricultural policy is irrevocable. As so many noble Lords have said, CAP favours some member states more than others, and deprives the social and regional funds of resources. But now, as we know, there is a concerted drive towards restructuring the budgetary policy to redress the balance, with very special attention being concentrated on the social consequences of what it decides.

The fight against unemployment, with the number of Europe's jobless expected to rise to 10 million by the end of this year, will become a priority. Rather than member states seeking independent solutions, remedial action will be sought through the European dimension. The European trade union movement, realising that our economies are now so interdependent, is planning to launch a Western European campaign against unemployment. Indeed, our own British trade union movement with all its experience of industrial relations could well contribute to the success of this action by increasing its involvement and support.

Only last week, at a Common Market meeting called in Luxembourg to discuss the European job crisis, the majority of EEC Governments agreed that in future the creation of jobs should not be put second to the fight against inflation. Now, to my mind, it seems sad that the only voice which was doubtful was Britain's. The majority of Ministers during this meeting agreed that the Commission should be asked to prepare proposals on ways of creating new jobs, as well as encouraging retraining. The roles of the social and regional funds would in this way be enhanced. They also agreed that this EEC money be used more directly to combat unemployment and not be channelled through national Governments.

Another area where the influence of a United European voice must be brought to bear is over Europe's relations with the third world. A start has been made through the Lomé agreements, but now the impetus must be towards the integration of the third world's economy into the world economy, thus giving the market a sense of security, providing secure access to capital, to technology.

This brings me to the last point I have to make this afternoon, and that is the political benefit to Britain of her membership of the European Community. There has never before been a greater danger to world stability arising from areas where peace is at risk. Never before has there been a greater need for a wise European voice to influence world affairs. Europe's attitude towards Afghanistan, towards what is happening in the Middle East, must be expressed from a common position. This seems all the more vital now that the United States has embarked on a course of foreign policy which, to some of us, seems both alien and alienating.

So, in my view, these are the areas where Britain can both benefit from membership of the Community and help to fulfil some of the realistic hopes of its founders. And I feel very strongly that progress in all these areas will be furthered by the taking of office, after 23 years, of the French Socialist Party, a party which has already given its commitment to using the European dimension to fight unemployment, to build a new relationship with the developing countries and to influence world affairs. This will give an added compulsion to bring socialist priorities to bear on European policies, thus fulfilling the aims of the founders, who hoped so much to make the Community a safer, a more just and more prosperous place for its inhabitants.

So, finally, may I say how much I welcome the Motion of the noble Lord, Lord O'Hagan, in that it represents one more means of creating greater knowledge and better understanding of the policies which now affect more and more our everyday lives. As I said before, with the question of Britain's membership of the Community once again part of public dialogue, it must surely be right to make the decision concerning this fundamental issue of Britain's place in the world from enlightened thinking, and not on grounds of chauvinism or nationalism or prejudice.

5.28 p.m.

Lord Kennet

My Lords, I am pleased to be the first to congratulate the noble Baroness, Lady Ewart-Biggs, on her maiden speech. I do so not only with the usual sense of pleasure but also, fortunately, in complete agreement with everything she has said. I know that, bearing in mind what has happened to her and what she herself has done about that and since that, she will be a more than usually welcome recruit to this House. I look forward also with keen anticipation to hearing the maiden speech of my old friend and ministerial colleague Lord John-Mackie. May I join with those who have thanked and congratulated Lord O'Hagan on bringing up this by now hoary subject, and yet finding many new and true things to say about it. I join also in thanking the Foreign Secretary for making a speech which, while being moderately non-controversial, laid many new facts upon the table and omitted to stir up any old wasps' nests except the one inevitable one.

I do not really believe in throwing figures around, but I would like to put in a few, in support really of Lord O'Hagan's hope that the, if I may call it so, new German alliance may help to bring to an end the injustices of the CAP and the Common Market budget at the moment. Now that it is virtually only Germany and we who are in deficit on public account with the European Community, certain political chances of putting it right open which were previously closed. I think that one may dare to hope that the new French Government may facilitate the rectification in a way that earlier French Governments would not have done, although, of course, we must wait and see about that.

It is good, as the noble Lord, Lord O'Hagan, said that the butter mountain is now a butter molehill. But the memory of the mountain has left scars. It has fluctuated in size before now, and we must be careful that it does not get any bigger. The memory of those ridiculous subsidised sales to the Soviet Union at a third of the price paid by our own people will die hard. There are other mountains which we have not mentioned today in the spirit of harmony which has prevailed, but no doubt with the new situation which is developing it will be possible to put the CAP right once and for all.

The Foreign Secretary gave us the striking figure that the Commission's bureaucracy was smaller than that of an average London borough council and said that our net contribution to the Community budget was less than 1 per cent. I would like to go further than that. I think that when he said "less than 1 per cent." he was thinking of central Government expenditure. If we take public expenditure as a whole, including local government expenditure, we shall find that our contribution to the Community budget is one half of 1 per cent. of all public expenditure in this country. Another comparison which is useful is that our contribution to the Community budget is one-eightieth of what we spend on health and social security.

The opportunities of making a meaningful and politically satisfying aid programme out of the European Community has been touched on. The figures which the noble Lord, Lord O'Hagan, gave were striking, but I want to add a note of warning on this matter. There is a political danger in the Lomé system. The achievement is grand as far as it goes, but there is a political danger. If we look at it in historical terms it is not immediately clear why the beneficiaries of Community aid should be limited to certain ex-French and ex-British colonies. It is not clear at all why the whole of South Asia should be left out. I for one look forward to the day when the European Community may be an instrument for gathering and harmonising aid payments by the member countries to all the third world countries to which such payments are made.

I think that (shall I say?) the political reticence or the politeness of India and many other countries—too many to enumerate, but getting on for half the population of the world—in being excluded from the Lomé programme so far has been admirable. I do not think that it can last and as I wish the Community well I hope that the horizon will soon be broadened to include all recipients, as well as all donor members of the Community.

I turn to the great question of Westminster sovereignty which has been running and running. It is, as I think the noble Lord, Lord Carrington, sustained with sufficient argument, absolute nonsense. To the regret of all federalists, of whom I am not one, but to the regret also of all those who wish well for the European Community, of whom I am one, the final decisions in the European Community are taken, always have been taken, and probably will be for a long time taken, by the Council of Ministers. Every one of those Ministers is a Member of his home Parliament just as much as any other Minister in any country.

If our own House of Commons cannot control the actions of the Community—and do not forget that at present every Government has a veto—it is because it cannot control its own Ministers. However, it is in as good a position to control the actions of its members who are Ministers when they go to Brussels—and all of them do—as it is to control the actions of those Members who are Ministers in any other time, place or subject-matter. That it does not so is very comprehensibly a matter of its own choice. I say "comprehensibly" because it is difficult to control Ministers. But it is no more difficult to do so in this field than in any other. None of us has a right to resent expressions of that difficulty, but I do think that we have a right to resent the erection of a structure of myth saying that the House of Commons does not have negative control over Community legislation. That is not true: it never has been true and I do not think that it will be true for a great many years yet—certainly not until the House of Commons wishes it to be true. So enough of this hide and seek behind a mixture of truth, half-truth, omission and untruth.

For myself I hope that the future of the Community lies particularly in the development of the European Parliament. Not this week, but at its next plenary in July there will be an absolutely crucial discussion on the apparently secondary question of the place of its work. All who have worked in it know that it is not secondary: it is absolutely primary. I do not refer to the absurd waste of public resources, time and money in the great motorised caravans of documents which steam up and down the motorways of central Europe. I do not refer to the exhausting time-wasting of the Members themselves or to the difficult conditions of the lives of officials whose children go to school in Luxembourg when the Parliament never even meets in Luxembourg now. All that could be regarded as secondary.

However, what is not secondary is the lack of personal political contact between the Parliament and the other two organs of the Community—namely, the Council of Ministers and the Commission both of which are in Brussels. It is enough if we, or indeed the Members of any national Parliament, were to reflect on what would have been the history of our own democracies if the Parliament and the Government had never been allowed to be in the same city. What would British democracy have looked like if the King and his Ministers were in London but the House of Commons was never allowed nearer than York? That is the fate which has so far been inflicted on the European Parliament and inflicted, we all know, very consciously and for perfectly comprehensible reasons by some Member Governments. Here again I look for hopeful changes from the new French Government.

I should like to make a general point which seems to me the conclusive reason against our leaving the European Community. Those who argue that Britain should leave the European Community because it is temporarily uncomfortable, are arguing for the destruction of the Community. Let me justify that remark. No member country has yet left. We are at the moment, or at any rate we were until last year, until the 30th May agreement—for which I give full credit to the present Government—certainly the most uncomfortable member of the Community. We were getting the worst deal of any member: it is arguable that we still are. If we leave, that will merely expose the fact that some other country has become the most uncomfortable member of the Community. That next country will have the precedent of British departure before it. British departure from the Community is, I submit, a recipe for the gradual disintegration of the Community, and those who urge it should bear that in mind.

Let me address myself shortly to the speech of the noble Lord, Lord Bruce of Donington. He said that the Community consists only of the co-ordinated efforts of its member Governments and that he was not arguing about institutions, and we should not, and that people keep on living ordinary lives. Finally, he came out with the resounding, but I believe completely meaningless programme: out of the EEC and back into Europe. Of course that does not mean anything, but I did listen with great sympathy to the earlier part of his speech where he was saying things which were clearly based on his own experience in the European Parliament. It is worthwhile and it is difficult to stand up and knock it when one has belonged to it and one has seen that it does not deserve to be knocked.

If I may be autobiographical for a few minutes, I have spent a year in the European Parliament, several years as a consultant to the Commission, several years in the consultative assemblies of the Western European Union, the Council of Europe and the NATO Parliamentarians. Before all that, along with my friends and former colleagues, Peter Shore and Tony Benn, I founded a group in the Labour Party in Parliament called the Wider Europe Group. This was long before Britian joined the Community.

That group looked at all the alternatives which the noble Lord, Lord Bruce, outlined; for example, OECD, ECE (which I do not think he even mentioned), the Council of Europe, and so on. We tried to get it going; we tried, through Parliament, to steer our party and the Government of the day as far as we could towards a concept of a wider Europe, by which we did not, of course, mean—any more than the noble Lord, Lord Bruce, means—sitting back and waiting for the arrival of democracy in Eastern Europe; but we did mean something that would include, Sweden, Switzerland, Austria, et cetera. We found that it would not wash then, and in a way it is a pity that the noble Lord, Lord Bruce, and those who think like him in the Labour Party should have returned to it now. It did not wash at the time we went into the European Community—there was an extraordinary full examination in the late '60s Cabinet papers and I await their publication in 15 years' time. And it will not wash now.

Therefore, as a result of the speech made by the noble Lord, Lord Bruce, I think that we can be glad that he at any rate was not using the disreputable argument that the end of Westminster sovereignty was at stake; and we can be glad that he has given us further evidence, if it were needed, that there are those in the Labour Party whose hearts—whichever way their heads may point—do not point so resolutely away from the Community as all that. I greatly appreciated the semi-comic passage at arms between the noble Lord the Foreign Secretary and the noble Lord, Lord Bruce, about whether or not the Labour Party was committed to leaving the Community. Of course it is. It is written as large as life in its party policy and it is held proudly on high as a banner in speeches by its leadership at the moment. The details of how it leaves are of quite secondary importance and I do not think that anyone would charge any of the Labour leaders with wishing to leave in a rude manner. The action is itself intrinsically rude; I have no doubt that they will be as polite about it as they possibly can in the circumstances. But I do not believe that they will get the chance.

I should like to conclude by wishing the present Government well in their term of office when Britain has the presidency of the European Community. As the noble Lord, Lord Carrington, told our Select Committee the other day—and this is something of which we had not all thought—it is a great pity that the second president in each year gets only 4½ months to reform the world, whereas the first, starting in January, gets six months full work. In spite of that seasonal disadvantage, I am sure that I express the feeling of the whole House in wishing the noble Lord, Lord Carrington, personally well, and the Government as a whole success, in the programme which he outlined a moment ago.

5.43 p.m.

Lord John-Mackie

My Lords, like my noble friend on my left, I also rise with due humility to address this august House for the first time. I should like to thank the noble Lord, Lord O'Hagan, for giving me the chance to speak on what I consider to be a very important subject indeed. I think that the noble Lord, Lord Carrington, was perhaps being a little mischievous in trying to persuade us into controversy, but when he reads what I have to say and what my noble friend Lady Ewart-Biggs has said, he will at least find that there is no controversy between us. That is as far as I shall go on the point of controversy.

I made my maiden speech in the other place nearly 22 years ago. Then I made some remarks that tempted The Times to make my speech the subject of its fourth leader. It was rather an unkind fourth leader, ending by suggesting that this particular new boy would have been better to have been seen and not heard. I was a little hurt as I thought that I was fairly easily seen and I thought that I went into Parliament to speak and to be heard. However, if The Times thinks that it is worth taking notice of my speech this time, I hope that it will be a little kinder on this occasion.

The subject of today's debate, which has been very ably moved by the noble Lord, Lord O'Hagan, concerns: the advantages which the United Kingdom derives from its membership of the European Economic Community". In my speech I shall take a look at the advantages to my own industry, farming. But before I do so perhaps I could place first among all the advantages the fact—and this has been emphasised by most speakers—that we have had peace in Europe for over 30 years, which looks like continuing, as I of course hope that it does, for many more years to come. It is a pity that we do not have a Middle East economic community.

I now turn to agriculture and to what I should like to say. No doubt noble Lords will appreciate that I have received brotherly advice on the subject. The mover of the Motion has rather taken some of the wind out of my sails, but perhaps I shall manage to say the same as he has said in a different way. We have been in the EEC for eight years. The transitional period for agriculture was a difficult one; the green pound had many teething troubles and undoubtedly created difficulties. But I do not want to catalogue the problems; nor do I want to hide them. They do not alter the benefits to British agriculture, and these benefits can be seen in the results. I always think that the only way to judge anything is by results.

I have been warned not to use too many statistics and I can appreciate the difficulty here, but although some of our main commodities have remained steady and one or two have gone down and varied a little, on the whole we have had large increases over these eight years. Cereals are up by 4 million tonnes, which is a tremendous increase, to a total of about 19 million tonnes of production. We are getting an extra 1,700 million litres of milk. I am using the term "litres", although I cannot think in those terms, but that is the figure. Sheep have increased by 3½ million; oil seed—an important commodity in these days when there is a lack of edible oil—has gone up by 270,000 tonnes, and the area where it was thought that we would be hit hardest, horticulture, has increased by between 40 and 50,000 tonnes of produce every year.

The reason for these increases is that the common agricultural policy, with all its faults, gives a stability that is so necessary to a long-term industry such as farming. Many people have spoken of reforms to the CAP. Of course, there must be changes, but I hope that none of these reforms will alter that stability. The world recession has hit agriculture, and our income has been coming down these last few years. But unlike industry, although a few farmers have gone out of business, not one acre has gone out of production; and this is a big difference when you think of the number of factories that have simply closed down. Farming has continued because of that stability.

It is not only farmers who have benefited. The increases that I have mentioned could add up to an import saving of £600 million or more. I do not think that my noble friend Lord Bruce of Donington subtracted that figure from his 10 per cent. increase in the cost of food. This helps everybody and along with everyone in the EEC the British people enjoy an adequate supply of good food and drink at prices commensurate with the cost of production to give farmers and their workers a decent income. It seems extraordinary that a great many people seem to think that farmers and their workers should be the lowest paid in the Community. Many people think that we should take advantage of some of the low world prices of food and raise farmers' incomes by deficiency payments of one kind or another.

I believe that more than 80 per cent. of the people in this country can afford to pay the proper price for their food, and if the rest of the people need help then it should be given in some way other than by returning to a system that was bad enough when serving only 200,000 farmers in this country but which would prove to be chaotic, to say the least, if it was used to service 5 to 6 million farmers in the whole Community. If anyone questioned the Lord President about his time in the Ministry of Agriculture, I think he would confirm that from his experience of deficiency payments in the early 1960s, when world food prices were dropping and he had to resort to standard quantities and minimum import prices, he would be very chary of recommending anything of that nature in an application on the scale of the EEC. Apart from that, the cost would be enormous. My noble friend Lord Bruce of Donington did not subtract the enormous cost of deficiency payments; alone the 19 million tonnes of grain to bring them up to world prices would cost £570 million. These figures have to be taken into account when one is discussing rises in the price of food.

I can almost feel the murmurings on surpluses, as if surpluses were something new. There have always been surpluses, as the noble Lord, Lord Carrington, said. In 1972–73, before we joined the EEC, it cost between £32 and £33 million to get rid of surplus potatoes in this country. I do not remember hearing any great fuss about that at the time. The CAP does not cause surpluses alone; the weather is the biggest sinner, especially in the case of perishables such as fruit and vegetables. The weather can also cause scarcities—many noble Lords may remember the potato famine of 1976–77.

I should like to try to put these surpluses in their proper perspective. The noble Lords, Lord O'Hagan and Lord Carrington, disagreed over whether the butter mountain represented six or seven days' supply. I should like to try a different approach. No doubt the Lord Chancellor or even Black Rod would have frowned had I asked them for a visual aid to illustrate my point in your Lordships' House, but let us take the case of grain—which is the main ingredient of our foods—and ask your Lordships to cast your eyes up at the 12 beautiful windows which adorn your Lordships' House, and relate them to the world's supply of grain, which is 1,400 million tonnes. One window represents 118 million tonnes, which exactly equals the EEC's production. British production of grain is represented by one-sixth of a window, which is 19 million tonnes. The 4½ million tonne surplus is represented by one-twenty-fifth of a window—about half of the small area of the window that is obscured by the scaffolding. I hope that will put the figure in some kind of perspective.

The surplus is insignificant enough when compared to EEC production, but the surplus pales into complete insignificance as against world production. I know that there are other surpluses—such as those of milk products and beef, to name but two—but the picture in these other cases is the same; they all fall into insignificance against the picture of hunger. There are 1,000 million people on a diet that is far too inadequate for proper nutrition, and 500 million of those people are actually starving.

In two of the Sunday newspapers this week stories were published about Uganda, China, Somalia and Vietnam, and about the dreadful starvation in those countries. Is it not within our capabilities to channel surpluses to these needy people? I know there are difficulties, for I came across some of them myself when I was at the Ministry of Agriculture, but there should be no problem in shipping grain. Instead of sending butter or dried milk, which create difficulties, why not send long life milk in large sealed containers? I have discussed this idea with the Milk Marketing Board, which says it is feasible.

We should have an EEC Committee with the power to carry out such humane work. Surely, in a starving world, this would be a better way of dealing with surpluses than trying to curb production? If we want to be mean, it could be taken off our already inadequate 0.52 per cent. of GNP which we give to the developing world; but it would be more generous to make it an extra.

My Lords, that is all I have to say. I hope noble Lords do not feel that I was being presumptuous in using the beautiful windows in your Lordships' House as a graph. If anything I have said will help to put surpluses in proper perspective and, more important still, to get these surpluses to the needy of this world, then I am sure that the designers and makers of those windows would have been pleased and forgiven me.

5.56 p.m.

The Lord Bishop of Worcester

My Lords, it is no small responsibility to follow a maiden speech of quality and one containing such information. We have with us a noble Lord who reflects years of exper ience and we can clearly expect both wisdom and informed comment from the noble Lord, coming as he does with experience in both the field of agriculture and Government, and from his late constituency, with an understanding of the urban situation as well. It is not every day that your Lordships' House welcomes two noble brothers. It must be unique that two such noble brethren should be speaking in the same debate, and we have listened to them both with interest. We await with great expectations further contributions from those who have honoured us with their maiden speeches this afternoon. Perhaps I might be allowed to add that I much regret that I cannot be here at the close of the debate because I have promised to undertake a confirmation in this diocese, which is currently without a bishop.

It is rather more than 50 years ago since Lord Davidson, as Archbishop of Canterbury, returned from Brussels after the famous Malines conversations and called for a further understanding of the divergent traditions of Europe and Great Britain. That was a remarkable start. Earlier this year our present most reverend Primate also returned from Brussels and spoke of his hope for a community, and in particular of a Church, that would be "united but not absorbed". In representing the Bench of Bishops in this important debate and, I hope, the wider life of the Churches of England, I can say that there is a very large degree of thankfulness for the whole concept of the EEC. We in the Churches welcome not only the start in the process of reconciling national interest, but also the opportunity of finding some deeper dimension of religion, morality and social concern for the nations concerned, and the opportunity is now given us to do so.

As nations we basically enjoy a common allegiance to the Christian faith; as cultures our ways have parted; as a large economic community we have now begun to find essential partnerships. Speaking primarily not on the economic or political issues, surely it needs to be registered that the EEC has made war between its member nations recede into a figment of the imagination. The noble Lord, Lord Carrington, put it even more strongly than that. How thankful we should be to hear those words which indicate that within Western Europe our peacetime conversations have come to stay. This is a real achievement considering the regularity of conflict between 1800 and 1939, almost every 30 or 40 years. We can now look to the stabilising peace-accepting communities and to a truly peace-seeking Europe.

I hope and believe that it is true to say that the significant discovery within the whole concept of the EEC, both before and during its early years, of peace for Western Europe signals a vital contribution to the whole of western civilisation, and through western civilisation to the developing nations that are associated with it. We have seen in recent months the fruit of this peace-making activity, of this peace-seeking in Europe, extend to initiatives towards finding a settlement, and more than that, a peace, in the Middle East. Alas! the traditional religious forces and powers of leadership in the religious world failed to bring peace at different times to Europe, as presently they are failing to bring peace to the Middle East. Perhaps our move towards unity in Europe will lead to unity there.

But, as often in human affairs, the original reasons for attempting and carrying on the great enterprise do not look quite the same today as they did when they started. It is as vital as ever to build a peaceful Europe. But the great fault lines of world society do not now lie chiefly down the Rhine. The coming eruptions of history are showing grave signs in other continents and along other lines of weakness. A division which was virtually unheard of when the Treaty of Rome was signed—the division between the developed industrialised north and the developing south—is beginning to move to the centre of the world's agenda for survival. Here, as we heard from the noble Lord in his maiden speech just now, as millions upon millions are born into the poor lands, and the obstructions of deferred development keep them from even the minimum decencies of life, the relevance of the European Economic Community to the ultimate issues of peace and war seem more cogent than ever. Perhaps I could add, in trying to voice a Christian conscience, that we welcome the basis in the EEC for a common understanding of human rights, liberties, and now the mutually deep concern over unemployment.

At the continuing Madrid Review Conference on human rights the Community has been able to pursue a common concern for human rights, for religious views, for freedom of expression, both within the countries of our own Community and the countries of Eastern Europe, and moreover within the legal procedures adopted by our own Government in Northern Ireland. How good that there should be now standing this concept of the Court of Human Rights. Closely related to this matter, your Lordships will have read in the press of recent attempts in Strasbourg and Brussels to tackle the acute problem now of 10 million unemployed within our member states. We, in committees and in Parliament here, are trying to see the way forward, but this European Council that has been convened in Luxembourg carries the hopes and indeed the expectations of these millions of people on a large scale that the Community might take steps towards tackling this problem.

I will go further and say that that Council carries the hope of many who voted in the referendum for our continued membership of the Community that such problems as unemployment would be tackled at that level, and not just at the national level; the point being realised that purely national Governments would be largely powerless to influence the economic recession from which we suffer. It is therefore with real concern that I read of a certain reluctance and lack of enthusiasm in even convening such a council, the reasons given being of fear that the European Community could raise expectations that it has no hope of being able to fulfil. This is not true in the field of unemployment. We will cure this scourge together, or not cure it at all.

The coming therefore of the enlarged EEC alters nothing so much as our perspectives. When one looks to the present situation, one realises that in Germany at the moment one of our English saints, Saint Boniface of Crediton, is a name known and revered by millions: in the land of his birth he is almost forgotten. The success of the politicians, economists and others in bringing Britain into a united Europe puts the Church of England—whose first diocesan boundaries were drawn by Theodore of Tarsus—into its true context. It is noteworthy that, on the Continent, the Protestant and Roman Catholic Churches have developed separately, one consequence of which is that the Church of England has no exact counterpart there. This fact may enable the Churches of our land to make a distinctive contribution to Christian social witness in the enlarged European Communities. The Church of England has been enabled to hold together in one communion people with apparently irreconcilable convictions without impairing these convictions. This art and this experience has social and political value in the context of Europe.

In conclusion, for Christians the compelling arguments of the opponents to the EEC come from those who fear that Europe may evolve as a rich man's club and turn away from the third world and its demands. This contention is much more a matter of future fear than present fact. If the fears of the opponents are not to be justified, it is vital that the Church and the Christian conscience play their full part in the shaping of the new Europe. This I believe we are beginning to do in the ecumenical movement Europeanwise as a direct result of many other secular and vitally important activities.

A Europe which has put aside its ancient family grudges of religion and which can look outwards to the third world with the strength and the will to aid, trade and invest, is the Europe that Christians want and can help to achieve. Any narrow association, unconscious of its responsibility towards the other European states, to the Warsaw Pact countries, Yugoslavia and the neutrals, unwilling to face the challenge of the developing nations or the problems of world pollution, or world peace—that is the Europe which opponents fear and Christians must reject. My Lords, we are indeed grateful to the noble Lord, Lord O'Hagan, for drawing our attention to this vital issue at this particular moment, and for presenting to us a vision and a goal to reach, for surely it is still true today that without vision the people perish.

6.8 p.m.

Viscount Eccles

My Lords, like the right reverend Prelate I am very grateful to my noble friend Lord O'Hagan for choosing this subject and introducing it in such a splendid speech. I think I am the first speaker from tbese Benches to congratulate the two maiden speakers. The noble Baroness, Lady Ewart-Biggs, with great charm and courage too, talked to us about her experience when she and her very able husband were in Brussels. I know what work they did there, and we can tell from her speech today that she has many more things to say to us in a broad and civilising way to which we shall be glad to listen.

The noble Lord, Lord John-Mackie, has a great experience in agriculture. He will find many noble Lords on this side who in one way or another are interested in agriculture, and we already look upon him as a firm ally. The convention in this House is that maiden speeches must be non-controversial, but of course there is an exception to all rules, and when the controversy is between the Labour Front Bench and the Benches behind them, that is an exception to which we can readily agree.

The noble Lord, Lord Kennet, said truly that we had been the most uncomfortable member of the community, but there is an historic reason for that. In the last war Britain was neither occupied nor defeated. All the original members of the EEC were either occupied or defeated, and that was a traumatic experience which we did not share. As your Lordships know, history shows that there is a certain kind of wisdom easier to learn in defeat than in victory. Immediately after the war, Winston Churchill called on all those who had fought on both sides to join up and create a new peaceful Europe. The defeated listened, the victorious did not. And now, in 1981, there is another reason which separates us from our fellow members in the Community; we have no direct or indirect frontier with the communists. The sea still ebbs and flows between us and the land mass across which they have seen armoured divisions roll towards their cities and countryside.

It would hardly be surprising if the way they thought about a third world war, after those two experiences, differed from ours. It would hardly be surprising if thoughts tending to neutrality were entertained across the Channel, and that is something which our membership of the EEC, as I see it, can help to avoid. Of course, neutrality does not appeal to us. It never would. But where would we be if the countries that lie between us and the Soviet bloc either went neutral or were overrun? It has always been in our interest—this is a point Winston Churchill never stopped stressing—that we should have good friends and strong allies on the other side of the Channel between us and the communist frontiers.

I do not believe, in spite of what the noble Lord, Lord Bruce of Donington, said, that NATO would stand up if we ceased to be a member of the Community. If we were not there, with our experience, working with them towards a united and confident Europe, the Community might tend to break up. Indeed, I think that is what the noble Lord, Lord Kennet, said might happen. Anything of that kind provides me at least with the first and fundamental reason why we should be a member of the European Community.

There are other advantages which are compelling. For centuries British prosperity has been won overseas. In the Middle Ages it was the wool trade with Europe, and when that was closed it was colonial trade with North America and the West Indies; then the great East India Company followed by the development of Australia, New Zealand and the African colonies. That long story of expansion and adventure overseas is the reason why there are so many of us today in these narrow, damp and crowded islands. We cannot now maintain our standards of life unless we export wherever we can find a market for our goods, and today, as many noble Lords have said, the largest and most free market is right there—our neighbours across the Channel.

I suppose there are, as one sees from reading some of the manifestos or draft manifestos, a few devotees of state planning who would prefer us to become a socialist economy ringed round with high walls of protection—a gloomy backwater, certainly poverty-stricken—in comparison with a fast-growing Europe on the other side of the water. But I cannot believe that the British people would ever accept that as an alternative to the great expansionist traditions which have made us what we are.

We do not only have an advantage in exchanging goods and services with the Community; we can also trade in ideas. Taking up something some noble Lords have already said, perhaps the most important idea is that, as a result of our maritime history, we have acquired a sense of the world as a whole. Many people I talk to do not seem to realise that there are still several European countries which have been, and are now to some degree, continental in their outlook. I well remember in June 1940 asking Dr. Salazar, the Prime Minister of Portugal, why he was so insistent that if Britain won the war we would make a better peace than the Germans. "It is very simple, "he said." You have a sense of the world as a whole and you might make a world-wide peace. The Germans have only a sense of the continent and they would reduce this continent to a dictatorship in which they controlled everything and, incidentally, they would attack our religion". I think that still holds good to a degree we hardly realise; as the right reverend Prelate said, the Community must get this sense of the world as a whole—and who better to persuade them than our Foreign Secretary?

On the other side, the Community can teach us, and is teaching us, many things of the greatest importance in the sphere of ideas and culture. I do not know whether your Lordships have the same impression about our young people as I have. All those I talk to are mad keen to go bicyling and hiking across Europe, not just a few of them from what one might call one class or from one sort of school but from every kind of school. They all want to go; they all want their cultural horizons to be widened. They are now mobile in space to an extent which my generation never knew. And they are not only mobile in space; they are mobile in their thinking.

What a difference compared with 60 years ago! My own father thought that if he mispronounced English, the French would understand what he was saying. Well, his great-grandchildren appear able to speak more than one European language passably well by the time they are going to university. What change there has been, what progress there has been! Could it have come about so quickly and so widely for our young people if they had not the feeling that when they were in Europe they were part of a community? From talking to them I am sure that it would not have happened.

In conclusion, I cannot resist saying a few words about what has happened to the arts and crafts. The advantages that have been opened up to them by our joining the Community have been simply splendid. When Mr. Heath took us into Europe he had organised a festival of British arts to be presented in Brussels, to celebrate the event. I happened to be in charge of those kind of things at that time, and so I attended the festival. It was marvellous to see how the clever fellows who were operating in the headquarters of the Community, and large numbers of the Belgian public were astonished and delighted at the quality of the events that we were presenting. Ever since then we have multiplied the exchanges between our artists and craftsmen. Many of them now have a public and a market in Europe, which they had never had before 1970 and would not have now if the restrictions on those kind of cultural activities had not been removed.

Consider, my Lords, quite a number of British auction houses. Do you think that they would have set up in different cities in Europe—think of the restrictions that would have been imposed on them—if we had not been in the Community? That is only a small example, but it can be multiplied.

I do not wish to detain your Lordships any longer, but I see three particular advantages of our membership out of many others. The first is in national security. If we are good members of the Community, the chances of thoughts tending to neutrality will be less. Secondly, now that we have had a rude shaking out in the last two years, most of our manufacturing industries are ready and able to compete, and we shall soon see the figures tending to go in our direction. Thirdly, there is the exchange of ideas. In the long run, this might be the most important advantage, because no one is very certain how to build a new world—I mean north and south together—and to exchange ideas between the people who are thinking about it is surely the only way to do it. Europe offers us that opportunity, which we would not otherwise have had. I fully support my noble friend.

6.23 p.m.

Lord Mackie of Benshie

My Lords, my pleasant duty is first to congratulate the two maiden speakers. The noble Baroness delivered a splendid speech. She did what is absolutely necessary in this House: she spoke from her own experience; and she spoke extremely well. Probably the highest compliment I could pay her is to say that she speaks as well as she looks, and that will be a great advantage to her in this House.

Now we come to my noble brother. I cannot pay him exactly the same compliment, but I am told that on no account must I be rude. But I have to congratulate him on his maiden speech. It is the most extraordinary and pleasant convention in this House that we refer to maiden speakers in a manner that is slightly like calling Messalina a maiden, or perhaps rather like the scene when one lets out the cows for the first time after they have been confined all winter. Dear old "ladies" who have given 50 tonnes of milk and have had 13 calves in a lifetime suddenly throw their legs in the air and canter around the field as though they were young again. I wondered whether that would happen to my noble brother. Instead, as I knew he would, he gave us a speech which was full of his experiences of farming and of politics, which extend over many years. I feel that after such a maiden speech, when he has had a little more time to get to know about agriculture and politics, he will be an extraordinarily useful Member of this House.

I do not want to take up much of your Lordships' time, but there are one or two things that I should like to say. First, I feel that the noble Lord, Lord O'Hagan, has done us a great service in bringing forward this subject at this time, in particular when one sees the slightly ridiculous mess that the Labour Party is in over the European Community. I think that the noble Lord, Lord O'Hagan, could be called a "Euronut"; I mean that in the kindest possible way, because I am one myself, and I have been for many years. While fighting elections I have, long before it was popular to do so, said that we should go into Europe. I do not think that any sensible person doubts that we must make our way in Europe, that there is where our future lies. If we in old Christendom cannot unite, then there is no hope at all for the world. So I think that the Community must be accepted by all sensible people as a fact of life and one with which we must live, as well as a situation in which we must progress.

Naturally, I should like to talk about the CAP. Here I agree very much with what my noble brother said. The CAP has rendered a signal service to the people of Europe. It has almost doubled production during the time that it has been in operation, and it has provided tremendous stability of prices—which was one of its original objectives. When we talk of the difference between the world price and the price in the Community we often forget—at least I never forget, but many people, including the critics, forget—that the very rise in production in Europe has kept down world prices. One of the faults of the CAP is that we dump the surplus on the world market at subsidised prices. We do much harm to a number of third world countries by keeping down the price of sugar for example, through surpluses.

Of course we can usefully give away the surplus in order to relieve famine, but that is not the long-term solution, and if we are to have in Europe the stability that is essential, we must control the surpluses. I think that this can be done in a number of ways. Certainly removing the totally open-ended support is probably one of the first ways in which to do it. The suggestion from the Commission that there should be, for example, a levy of a penal character on the nation, district, or dairy that is producing the surplus milk is probably a very good one. Price must come into the matter at the end of the day, but all other devices must be tried.

The essential stability is what has produced the food, and we cannot therefore let the market operate to its full extent. If we can persuade the other nations of Europe, and the farmers of Europe, that it is in their interest to control the surplus, otherwise they might well kill the goose that lays the golden egg, then we shall have done a great service to the Community as a whole.

I think that the only real surplus is in milk, and up to the present no real step has been taken to control it. It is also true that the rest of the Community think in a rather different way than we do. They do so—the critics are right here—because they are in circumstances that are different from ours. They are producing most of their own food, whereas we were able to subsidise farmers directly because we were subsidising only half of the food, and even that was proving far too expensive. If today we were subsidising the farmers of this country directly, the cost would be so prohibitive that it would cause the present deficit to pale into complete insignificance, and of course in Europe it would be so astronomical that one could hardly read the figures.

Other countries of Europe are pledged to a system of support by buying-in the surplus. It is a workable system, and what is wrong with it is that it is not being tuned properly. So when we talk of reform of the CAP, what we must really look at is not a wholesale change in the method of supporting agriculture; we must look to a large amount of common sense, patient negotiation and fine tuning. We are only one of the nations in the Community; the rest of them are in fact well pleased with the system. The Liberal group in Europe, taken as a whole, were quite pleased with the last price review. They do not think the surpluses are excessive, and we are trying to persuade them that really something must be done about making it more practical. But that is how they think in Europe, and when we talk about reform of the CAP I do not think we should be looking for wholesale changes. What we must look for is an introduction of common sense, a control of the surpluses and a going back, perhaps, to the original purposes as envisaged in the common agricultural policy.

That, I think, is all I want to say, my Lords. I think it is enormously important to get it right, because there is so much nonsense talked about it—and, of course, every time some butter is sold to Russia there is a great howl. It would not take a very great deal to get it right, and Britain, I think, can play a tremendous part in so doing.

6.32 p.m.

Lord Ardwick

My Lords, first I must thank the noble Lord, Lord O'Hagan, for giving us the opportunity to debate Europe in a positive fashion. I should like at some time for us to have a debate on the future of Europe in which we are not specifically concerned with Britain but with the future of Europe and the future development of the Community as a whole. I must also pay tribute to the two maiden speeches, from the noble Baroness, Lady Ewart-Biggs, and the noble Lord, Lord John-Mackie, which I thought were unusually thoughtful as well as charming, particularly Lord John-Mackie's use of the windows here as a visual aid. I am very glad to see that the brothers Mackie, although divided by party, are undivided on the question of the CAP. It was from Lord Mackie of Benshie that I first learned that there was a great deal to be said for the common agricultural policy; that the prices paid to farmers were just rather than generous; and that the surpluses, although excessive, were not very much more excessive than prudent husbandry would require. I hope that is a correct interpretation.

My Lords, it has always been difficult to weigh the advantages of belonging to the European Community against the costs, because the costs can be presented in statistics and most of the advantages cannot be presented arithmetically. Sir Harold Wilson once pointed out, when faced with this problem, that you cannot quantify an élan. Perhaps it was just as well, because at that time the élan which was supposed to follow our entry never came. For we had, as the noble Lord, Lord Carrington, pointed out, the misfortune to join the Community at a moment when its golden age was coming to an end, with the breakdown of the Bretton Woods monetary arrangements, the inflation arising out of the Vietnam war, and finally the rise in oil prices, which was to create the new phenomenon of an inflationary recession.

These events brought to an end the era of automatic growth and full employment. They deprived the national Governments, the member Governments of the Community, of their self-confidence, and often caused these Governments to be built on tremulous coalitions, or to exist with perilously small majorities. So it was not remarkable that in such conditions Governments had to put their immediate national interests first and their long-term national interests in an integrated Europe second. What was remarkable was that the Community survived intact the worst recession since the 1930s, and did not revert to high national protectionism of the kind now being advocated in this country by some politicians.

There was a hope, which existed even up to a couple of years ago, of Europe attempting a concerted, co-ordinated expansion while reconstructing its out-of-date industries and encouraging and sponsoring the new electronic ones, which require a market as big as the United States if they are to compete with American and with Japanese products. That hope of a concerted expansion remains, and must remain, but it is a rather flickering hope at the moment. Of course, we have the advantage of belonging to one of the world's great trading blocs, which, as has been said more than once this afternoon, has immense power in the negotiations which take place in the GATT and elsewhere.

That is of great advantage; and yet we have to acknowledge that Europe, faced with unpredictable increases in energy costs and the unsolved relationship of inflation and unemployment, lacks the economic stability and wellbeing essential to its social tranquillity, and so to its security. It is a task of the greatest and most urgent importance to strengthen the economic base of the Community, because that is the foundation of the security of the Community.

What we have to bear in mind is that the chances of solutions to our national economic problems are greater inside the Community than they would be outside the Community; or if the Community were to break up after the secession of one of its major members—a danger to which more than one speaker has pointed this afternoon. We must acknowledge that, in spite of the current problems, we are enjoying, and have enjoyed for years, the fruits of West European unity. What are those fruits? Sometimes people defend the Community by arguing that it has made war unthinkable between West Europeans—the kind of wars that we had in 1870, 1914 and 1939. But I am not sure that this statement makes the powerful impact that it should.

What we have to do, I think, is to go back in history to the immediate problems after Hitler was defeated. A major one was what was to be done about Germany, this great dynamic power that had tried twice to make Europe its empire. In those days some people wanted to break Germany up. There was even the incredible Morgenthau plan, to make it into a de-industrialised agricultural country, until people suddenly realised that it would impoverish the whole of Europe if any such thing was attempted. The solution was found; West Germany is in the Community as an integral part of the Community. It has given Germany enormous self-confidence—self-confidence to propound the Ostpolitik which was the beginning of the détente which at the time looked more promising than I am afraid it does at this moment.

Another of the post-war problems was to restore stability and prosperity to the shattered economies of Western Europe. For in conditions of economic chaos, the passions, the military organisation and the capacity for conspiracy which the resistance groups had had to develop could easily have been diverted into civil war; and with the Soviet Union already moving its sphere of power westward, who knows where such turmoil could lead? So there was a whole variety of devices to deal with the situation. We had the Marshall Plan, we had Western Union, we had the Council of Europe, NATO and the OEEC, and eventually the European Communities were created to put together economic stability, political commitment to pluralist democracy and defensive military power.

Britain, of course, was one of the architects of much of this, but stayed aloof, not only because we were the victors of the war but because we thought that, being the head of the Commonwealth and having a special relationship with the United States, plus a world currency, this put us into a different league. But this proved to be an illusion. The Commonwealth was changing and we had to seek a new role, and the only place to seek it was in Europe. We saw that the bounding economy of Europe could provide us with a wider market but, more important, Europe must surely develop a political entity; and when it did so, it would have an authoritative voice in the counsels of the two super powers. Who would then listen to the lone voice of Britain? Better for us to play a leading part in a political community which itself could compel attention—and this we did and this we do. Sometimes, people saw the Community as the basis of a "third force" that would stand between the super powers, but more often they have, more wisely, seen it as standing side by side with the United States, modifying America's external policies and reaching consensus with America.

Never has this seemed more desirable than in recent years when a succession of United States Presidents has inspired something less than complete confidence in their European allies or now, with a new President of the United States and a new Secretary of State, and nobody quite certain what policies they are going to pursue; or perhaps they are more certain of the policies but not of the mood or strength with which they intend to carry them out. This is the reason, I think, for a certain uneasiness about the United States that has caused European political co-operation to go ahead while economic integration has faltered. Nothing has done more to inspire it than the realisation that the Middle East could easily become the source of a world conflict and that the Community must have a voice in these affairs and a policy. About the current policy, it is possible to have doubts. I have doubts about it. But about the need for a policy, no, I have no doubts about that.

In these affairs, we have a voice, a voice that demands and receives respect. And now, the Foreign Secretary is to be President of the Council of Ministers and we look forward to his leadership. The last time we had the presidency, Anthony Crosland was Foreign Secretary. He made what I thought was a superb presentation of British attitudes towards Europe. It was 6,000 words of beautiful and clear prose, a combination of his own writing and his own thinking with the wisdom of the Foreign Office, a very much neglected document. At the time he presented it to the European Parliament I remember that I went around and found that all my British colleagues, whether pro-Market or anti-Market, thought highly of it. Somehow it had found consensus among us. Anthony Crosland died shortly after taking office, and his predecessor had to become immersed in the affairs of Rhodesia, so that that first presentation did not yield all the fruits that we hoped of it.

Are we to detach ourselves from all this? Do we imagine that we can live behind protecting economic walls and engage in hard, bilateral, trade bargaining and still be admitted to the intimate political councils of the Community? And what about those old Europeanists who have become faint hearts or disillusioned because, they say, Europe no longer has the political will to create unity. This is to treat political will as if it were a human virtue susceptible to such copybook maxims as: "Where there's a will there's a way; Vouloir c'est pouvoir; Was man willt, kann man tun".

But political will is not simply resolute government; the most determined Prime Minister cannot impose policies if the means, the resources and the consents are not available to him or her. Will is never enough on its own. Which of you, by taking thought, can add one cubit to his stature? When I hear people talking as if the price of food or of the CAP or of our contributions to the budget were the only things that mattered, talking as if a break with Europe must be made unless we are completely satisfied on all these points, I think of Wilde's definition of a cynic: a man who knows the price of everything and the value of nothing.

My Lords, what I have said this afternoon is very different from the speech of my noble friend Lord Bruce and is more akin to what the noble Lord, Lord Carrington, has said. I am in no way politically embarrassed by this. It is possible to have different views about Europe and to belong to the same party. What I have said would meet with the approval of all the Labour Foreign Secretaries since Ernest Bevin, and would certainly have the approval of almost all the non-British members of the socialist group in the European Parliament and of the European trade union movement.

6.45 p.m.

Baroness Faithfull

My Lords, like other noble Lords I should like to congratulate our two maiden speakers. We are delighted to have heard the noble Baroness, Lady Ewart-Biggs, a fellow woman Peer. I always considered and thought of stained glass windows as eternal. I hope that the EEC may be the same. I am grateful to the noble Lord, Lord O'Hagan, for this debate today, because I wish to ask a question and not to make a speech. It is with some diffidence that I do so, because I am descending to administrative detail rather than keeping up the standard of the splendid broad-sweep speeches that we have heard. My question concerns Article 189 of the Treaty of Rome—and I quote: In order to carry out their task the Council and the Commission shall, in accordance with the provisions of this Treaty, make regulations, issue directives, take decisions, make recommendations or deliver opinions". It later states: A directive shall be binding, as to the result to be achieved, upon each Member State to which it is addressed, but"— and I come now to the operative words of my question— shall leave to the national authorities the choice of form and methods". Any form of amalgamation of people and politics requires the necessity, on the one hand, to achieve unity and, on the other hand, to maintain the individuality and identity of the nation. We can be patriotic to both and, as the right reverend Prelate has said, we we can be united but not absorbed. If, within the EEC, directives are issued which attempt to harmonise principles of a directive in a very detailed form, there is the likelihood that, while the principle of the directive is applicable to each individual country, the details of the directive do not fit into the social, business, administrative, or political character of each country. May I therefore make a plea that directives should be clearer and simple, dealing only with the principle but leaving the individual countries to embody the principle in their own way within their own countries. To attempt to harmonise a directive in every detail, crossing the t's and dotting the i's, is to diminish the authenticity of a directive. Indeed, I go further and, to use a colloquial phrase, say the directive tends to lose clout.

We have heard of the number of people employed in the Commission and it is not a very large number, but one wonders sometimes whether there is a points system in the Commission awarded when a directive is successfully implemented. This may be an ignoble thought, but perhaps directives embodying only principles would enhance the work of the European Economic Commission in which so many of us have profound belief and to which we are committed. Therefore, I simply ask a question of the noble Lord, Lord O'Hagan, to whom we are most grateful for initiating this debate. Can something be done about the administration of directives? My Lords, before I sit down, may I also congratulate my noble friend Lord Carrington, the Foreign Secretary on the presidency this year?

6.50 p.m.

Lord Vernon

My Lords, speaking as I do at No. 13 on the list of speakers, the House will not be surprised to hear that I have somewhat revised the notes for my speech. I hope therefore not to take up too much time. I cannot claim the expertise of the noble Lord, Lord O'Hagan, and other noble Lords who either are or have been members of the European Parliament. My only direct experience of the workings of the Community has been as a member of one of your Lordships' European Sub-Committees, that on food and agriculture, and that experience only confirmed me in my view about the advantages of our remaining in the Community.

Having been brought up in the shadow of the First World War, and having lived and fought through the second one, the case for integrating more closely with our neighbours on the continent, with whom we share a common cultural heritage, has always seemed to me unanswerable. It is a matter of common sense. It is not a static community which in my view we should seek but one which will advance in due course towards common passports, a common currency and, most of all, a common foreign and defence policy. To that extent I am of course a federalist. If this involves a loss of sovereignty, it seems to me that the price is well worth paying. In any case, full national sovereignty is an outdated concept which has little meaning in the interdependent world in which we live today.

We hear a lot these days about how unpopular the EEC has become in this country in spite of the two-to-one majority in favour of our joining at the time of the referendum. This may be so; but, if it is unpopular, this is largely the fault of those who lead public opinion—and this is not just the politicians but also the media—who fail to explain the advantages of membership and who fail to answer some of the criticisms which are made about it. How many people, for instance, are aware of the facts given by the noble Lord when he introduced the debate this afternoon? How many people realise that our exports to the Community have grown at the annual rate of 23 per cent. over the past six years? How many people realise that our exports to the Community are now 43 per cent. of our total exports? How many people realise that the butter mountain only amounts now, we have been told, to seven or eight days' supply?

I was going to say something about the CAP but as this has already been commented upon by the noble Lord, Lord Mackie, and others, and as my noble friend Lord Walston—who knows so much more about it than I do—will be speaking later, I shall only reiterate the point made by the noble Lord, Lord O'Hagan, regarding our dependence on food imports. We import, I believe, somewhere between 40 per cent. and 50 per cent. of everything that we eat. A guaranteed supply of food at a fixed price is of enormous value to this country. It means that we cannot be held to ransom by world prices which fluctuate all the time and which could fluctuate even more in the world which is coming, when there will be far more mouths to feed.

Apart from the economic considerations, there is the overwhelming political argument that membership of the Community gives us a voice in the councils of the world which will be listened to with respect. This was elaborated on by the Foreign Secretary in the course of his speech and it is something which we should not lightly disregard. So I believe that the Government have a duty to explain these issues to the British people who, by and large, do not understand them. We cannot expect the Labour Party to do so because they have as a party declared their unequivocal hostility to continued membership and their commitment to withdraw and go it alone behind newly created tariff barriers. That is a commitment which I believe would spell disaster to a great trading nation such as ours and which I think they will live to regret.

The Conservative Party are not inhibited by the extraordinary divisions which exist within the Labour Party. As we have heard from the Foreign Secretary this afternoon, they really believe in the Community and want to make it work. One positive step which the Government might consider which would create a better understanding of the Community in the country is to improve the teaching of languages in our schools.

I think I am making a slightly contrary point to that of the noble Viscount, Lord Eccles. I understand him to say that people now spoke better foreign languages than they used to. This may be so up to a point; but only I think to a very limited extent. So many of the teachers in our schools are unable to speak fluent French, German or Italian, let alone pronounce these languages, it is hardly surprising that the performance of their pupils is so often abysmal and certainly compares unfavourably with the fluency with which other EEC nationals so often speak our own language.

Is there not scope for arranging exchanges of language teachers with these countries to our mutual benefit? In this connection, I should like to read from a report by the "Think Tank" the Central Policy Review Staff. Paragraph 9 of their introduction to education, training and industrial performance in 1980 says: Despite the recent findings of the British Overseas Trade Board that United Kingdom exporters employed fewer employees who could speak foreign languages than their more successful competitors, we did not find any employer who placed weight on linguistic ability in its graduate recruitment". If that is true it is a sad reflection on us as a nation. I hope very much that the Government will do something to rectify it. I feel that such a proposal would be welcomed by those concerned with exports, who are only too well aware of the handicaps under which we so often operate.

To return to the main theme of this debate—the advantages of our remaining in the Community—I think I have heard every speech so far and, with the possible exception of the noble Lord, Lord Bruce of Donington, all the speeches have been in favour. There has been virtual unanimity, and even the noble Lord, Lord Bruce, was less discordant than perhaps some of us thought he was going to be.

I have already stressed what in my view are the enormous economic and political advantages. The Liberal Party, to their very great credit, have said this from the very beginning. The party to which I belong is no less enthusiastic in its dedication to the European ideal. I am confident that when the issues at stake are fully explained to the British people, as I am sure they will be—certainly by the Liberal Party and my own party—in the weeks and months that are to come, the British people will take the same intelligent view that they took at the time of the referendum.

7.2 p.m.

Lord Boothby

My Lords, I think we should all be very grateful to the noble Lord, Lord O'Hagan, for raising this vital topic. This is a difficult speech for me to make because it is sad, and I hate being sad. But I think it is essential at this moment to look back and see how and why the EEC in its present form came into existence. I have been in this business for a long time. I was at the San Francisco Conference as a newspaper correspondent nearly 40 years ago, in 1945 before the war ended, and I wrote then to my newspaper on the following lines: While Stalin is collecting half Europe"— (which he was then doing under the Yalta Agreement)— we have no option now but to form and form quickly a regional bloc consisting of all the countries of Western Europe". That was in 1945. I was a founder member of the European Movement which was formed by Churchill in 1948. Our object then—and we have to face the fact—was nothing less than a federal union of Western Europe under British leadership. And now I am going to do an almost unforgivable thing. I am going to quote to you fairly briefly from two speeches which I made nearly 40 years ago, because they were true and because this is probably the last time I shall venture to address your Lordships. The first one was made in another place on 5th May 1948, and I said then: In my submission war is inherent and endemic in a world of completely independent sovereign States". I may say that in this I find myself in total disagreement with Mr. Enoch Powell. I went on to say: I remember 15 years ago taking a long walk with Philip Lothian at Sandwich; and he then expounded to me, with great force and passion, his belief that the principle of the sovereign equality of nations was false and wrong; that it had no basis of reality; and could only lead to war … he was Secretary to Mr. Lloyd George at the time". He played a great part in the development of the Peace Conference. He said that the United States, France and Britain should take the leadership through the exercise, invisible but unchallengeable, of universal sea power and a strong Western European defence force. He said the breakdown was caused by the fact that the United States contracted out and turned towards isolation; and that we ourselves withdrew from Europe following the abortive French occupation of the Ruhr in 1923. The result could only mean anarchy; and anarchy was what we got. For 20 years the disarmed, disunited and isolated democracies of Europe writhed in the rigid structure of separate sovereign States evolved in the 18th and 19th centuries, until distrust, poverty and unemployment gave way to hatred, dictatorship and the new combination of Fascist aggressor states which led to yet another attempt to impose integration upon the continent of Europe by force". I went on: Isolation in the modern world is a terrible thing. The dream of every potential aggressor is to isolate his opponents one by one. As Burke said: 'When bad men combine, the good must associate; else they will fall, one by one, an unpitied sacrifice in a contemptible struggle'. It seems to me that the supreme object of our policy should surely be to build a democratic world order so strong that no State or combination of States will dare to challenge it. I realise that, for this, we shall have to make sacrifices. But adequate deterrent power is essential. As Admiral Mahan truly said, 'The function of force is to give time for moral ideas to take root'. Such a democratic world can only be built up by the creation of a United States of Western Europe in some form or other, in close association with the British Commonwealth, and with the United States of America, upon whose material strength the entire structure must in the first phase depend. The process must be one of spiritual growth, as well as of material progress; and the end must be a series of organic acts of union. I see no other way. The choice that confronts us is fundamental. I do not think it is obscure. It is the choice between international anarchy and the rule of law; between the rebirth or the doom of our Western civilisation". The second quotation—and your Lordships will be pleased to hear that it is the last—is brief. It comes from a speech I made to the first meeting of the Consultative Assembly of the Council of Europe in August 1949. Churchill did me the honour of listening to it and he told me afterwards that he approved of what I said, which was this: The trouble with Western Europe is that, while the ideal of law based on reason, custom and morality, has been applied within the nation-States, it has been accepted but never applied as between nation-States. We must now face the fact that, so long as each nation-State recognises no authority above itself and no duty except to itself, wars will continue. Sovereignty, in the sense of the exercise of absolute political power, is the supreme source of law. Whenever it resides in groups or individuals within a society and not in the society itself, there is internal anarchy. Whenever it resides in nation-States, and not in a society of nations, there is international anarchy. For my part I am convinced that the doctrine of the sovereign equality of nations is not only nonsense but a mathematical formula for a war. I share the belief of my friend, the late Lord Lothian, that insistence on absolute state sovereignty is one of the principal causes of the evils of our modern world; and hold the view that the only solution to this problem lies in some merging or pooling of national sovereignty. I feel most strongly that in this Assembly, and in the Committee of Ministers, we have the instruments with which an organic European union can be forged. We live in a rapidly shrinking world. Yet we have continued since the war the fatuous struggle to maintain complete national political independence, and to achieve complete economic independence. With what result? We cannot trade freely with each other. We cannot even visit each other! How can we get rid of the present formidable obstacles to European unity? Let me give three examples. In order to free our exchanges for current transactions, we shall have to co-ordinate our monetary and fiscal policies. In order to increase our productivity we shall have to plan investment in our basic industries on a European scale, and to encourage specialisation. In order to increase our trade with one another we shall have to negotiate reciprocal trade and payment agreements and adopt a preferential system. All this will require the establishment of a number of permanent functional European authorities. It will require frequent and major decisions of policy. For instance, the doctrine of non-discrimination, accepted in principle at Bretton Woods and Havana, but seldom applied in practice, will have to be reconsidered in the light of new conditions. Unless we establish, at the same time, an executive international political Authority, the functional authorities will be powerless; because somebody has to decide policy, and somebody has to give the orders. When you come to think of it, this political Authority can only be the Committee of Ministers". In other words, a federal government with limited functions, but definitely defined powers. What other body has the necessary power? Who can decide policy on behalf of the participating Governments? What I have in mind is a number of functional committees working under the general direction and supervision of the Committee of Ministers which should itself meet at frequent intervals, and have a permanent secretariat of its own, manned by a European Civil Service. It follows from this that the Assembly, which in my opinion should meet at least twice a year, should have the right to put forward any proposals it may wish to make for consideration by the Committee; that the Committee should be required to make periodical Reports to the Assembly, and to answer any questions which we may put to it; and that the Governments should, in turn, furnish the Committee with adequate information and powers. Here, then, is the constructive proposal which I wish to put forward. After much reflection during the past two years, I am convinced that it is by far the most hopeful line of advance. In his opening address, M. Herriot reminded us that there were some good German philosophers before Fichte introduced, and Treitschke developed, the accursed doctrine of power. He mentioned Goethe and Kant. Let me conclude by quoting one sentence of Humboldt which I think we should all keep on our writing tables: 'The State is merely a means to which man, the true end, must never be sacrificed'.". I come now to the original Council of Europe. It started with tremendous hope. One of the first resolutions we passed was one demanding the creation of a European political authority, with limited functions but defined powers. As Lord Montgomery, the Field-Marshal who was Deputy Commander of the Forces in Europe, said: The strategic centre of the battle for world peace today is Western Europe. We must be able to hold the position there. The task before the nations of the West is primarily political. Economic fusion and military strength will not be obtained until the political associaton between the group of nations concerned has first been defined". It has never been defined and it is not defined today.

Then, suddenly, in August 1950, Churchill dropped a bomb in the Council of Europe. He demanded, The immediate creation of a European Army, under a unified command with a single Defence Minister, in which we should all bear a worthy and honourable part. Those who serve supreme causes must not consider what they can get but what they can give". Then the British Foreign Office struck. Eden went to Rome in the autumn of 1951, and at a press conference he announced that Britain would never join a European defence community of any kind. The effect on the Council of Europe was traumatic. I am a little surprised that the Foreign Secretary—who I regard as the best Foreign Secretary we have had in this century, and he knows it—should have quoted with approval Spaak and Jean Monnet.

I knew them both very well. I was with them in Strasbourg at the time. They both told me that the British Foreign Office had killed the Council of Europe and everything it stood for. That is why Spaak resigned the presidency. It was the sole reason. He told me so and he told the Council of Europe so. So they were not best pleased. Spaak went off and, with the co-operation of Monnet and the strong support of Schuman, Adenauer and de Gasperi, set out to create something that would take the place of the Council of Europe.

I shall never forget one night in the hotel in Strasbourg, where the Conservative delegates had a meeting after this happened. We were all in despair. We drafted a letter with great trouble. We did not send it to the Foreign Minister, because we knew that that was no good. We sent it to the Prime Minister and quote one paragraph from it: We feel obliged to bring to your attention the great and increasing difficulty of our present position as Conservative delegates to the Consultative Assembly of the Council of Europe. A week ago, events seemed to be moving in a manner favourable to British interests…". It is no exaggeration to say that the unexplained and unqualified refusal of Great Britain to participate in a European Army, announced by the Foreign Secretary in Rome, came as a shattering blow to most members of the Assembly.

The Minister of Supply said of it: We all have a positive duty to bring through to success this historic project which we ourselves initiated here. If it should fail through lack of support or lack of conciliation on the part of any of us, we shall bear a terrible responsibility before future generations". The Minister of Housing who was then Mr. Macmillan, said: Last August we voted for a European Army and that was a tremendous decision…There should go out tonight a recommendation which should send to the peoples and governments in every part of the world a ringing note of courage and of faith. At the end of this week we shall have to listen to speeches by the chairman of the Committee of Ministers, Dr. Lange, M. Schuman, Dr. Adenauer, Signor de Gasperi, M. van Zeeland; with a British statesman of the front rank conspicuous only by his absence. We must admit that we do not find this a very agreeable prospect. In conclusion, we venture to appeal to you to take some positive action designed to restore British prestige in the Consultative Assembly, and to show that His Majesty's Government mean to play their part in the military defence and economic development of a United Europe". This was signed by us all. To that letter there was no reply.

Thereafter the Consultative Assembly degenerated, as Spaak foresaw, into total impotence and irrelevance. Mr. Herbert Luthy was to write: The Foreign Ministers of Western Europe, like actors on a revolving stage which had got out of control, kept reappearing every few days against different a backcloth, always playing a never-completed first act". We refused to send a delegate to the conferences at Messina and Brussels which drafted the Treaty of Rome.

The truth is that Eden was determined to get out of Europe and to stay out. We have it on the authority of Mr. Anthony Nutting, who was a Minister of State under Eden at the time, and of the noble Lord, Lord Gladwyn, himself, that he reacted like a kicking mule to the suggestion that we should keep a few divisions at least on the continent of Europe.

Lord Gladwyn

My Lords, I did not quite hear what the noble Lord said. If I am supposed to have resisted something I have to hear it.

Lord Boothby

My Lords, I can only say that the noble Lord concurred with it at the time. He agreed with Anthony Nutting that when it was suggested that we should maintain troops on the continent of Europe Eden reacted like a kicking mule.

Lord Gladwyn

Who, me?

Lord Boothby

The noble Lord may not agree but whether or not the noble Lord, Lord Gladwyn, agrees, Eden did react like a kicking mule.

Lord Gore-Booth

My Lords, may I join my protest to that of my noble colleague Lord Gladwyn.

Several noble Lords

Order, order!

Lord Gore-Booth

That has made my point.

Lord Boothby

My Lords, it was cold-blooded murder. I was one of the victims. I knew something about it, and it ended my political career. Why Churchill permitted it remains a mystery, and probably it always will.

I have said what I had to say a bit bluntly. I turn for a short time to the EEC in its present form. We did not create it. We did not make it. There is not an enormous but there is a substantial bureaucracy in Brussels, without any political power. They spend a great deal of time arguing with the Ministers concerned in the various countries. The European Parliament is at present a farce. Nobody knows who they are. Nobody knows why they are there or what they were elected to do. Their debates are not reported. All we know is that they shuttle between Strasbourg and Luxembourg and Brussels and back to Strasbourg again, carting tons of useless paper at enormous expense.

The common agricultural policy has been a disaster, although there are signs now of an improvement. I agree with the noble Lord the Foreign Secretary that it does not cost as much as all that in relation to what we are spending on everything today. However, it has cost a lot of money and we have built up mountains of food, including butter, which we have exported to the Soviet Union at knock-down prices. As I have said, there are signs of an improvement but nobody can say that the common agricultural policy has been a success. The taxpayers of Germany and this country have had to bear the burden of the expense.

The noble Lord the Foreign Secretary mentioned the common fisheries policy. Let us face it; our relationship with France has recently not been good. The French objective at the moment, having to a considerable extent fished out their own grounds, is to get their modern trawlers into our home waters and fish out ours, and in so doing to ruin the British inshore fishing industry. Her Majesty's Government have repeatedly given assurances that they will not allow that to happen. I believe them and I thank them. But so long as the French attitude remains what it is, what is the use of going on wasting time over a common fisheries policy? Under these conditions we cannot have one.

Then there was the Dublin Conference. The Prime Minister had a frightful row, which was made public, at the Dublin Conference. It was clear that she was not even on speaking terms with President Giscard d'Estaing. That I think was unavoidable but it did no good to Europe.

In retrospect, I think we should not have joined the Common Market as and when we did and at the time when we did—at the beginning of a very big recession—and signed a long treaty which we had played no part in framing. Today there is no effective European defence; we are entirely dependent on NATO. I think NATO would be enormously strengthened if there were an effective European defence, but France is taking no part in it. If there were an effective European defence we should not be curtailing, running down the Navy (sea power is absolutely essential) and there would be a great many more armies on the continent of Europe. There is no viable international monetary system.

At this moment I think that the EEC is doing positive harm to Europe as a whole and to the hope of world peace. As Lord Montgomery said, we could have had the leadership of Western Europe after the war but we refused it. The truth is that after the war we missed the European tide—the sooner we realise it the better. I do not think we shall see it at the flood again for quite a long time. But it cannot be too long as we have not got the time. As for the EEC, for the reasons most cogently given by the noble Viscount, Lord Eccles, and by the noble Lord, Lord O'Hagan, himself, I do not think that we should walk out of the EEC by ourselves. I would oppose that. It would give the impression that we do not like it, whereas we all know in our hearts that not only must we like it but that we are an inseparable part of it.

I would say this before I sit down. Unless it is radically revised and unless it is given some political foundation, of which at the moment it has none, the EEC will collapse. It will break up of its own accord. My Lords, it can be done, but not without political authority for which some of us have striven for so long. Federal governments are the hope of the world. I agree that that power should be very limited and the Canadian constitution at the moment is a typical example of how far you can go and how far you should go. But I do say that a federal political authority, at least with power over defence policy, foreign policy and monetary policy, should be formed as soon as possible.

M. Clemenceau said when he was dying: The glory of our civilisation is that it enables us occasionally to live an almost normal life. The armistice is the interval between the fall and the rise of the curtain". My Lords, that was true of his time. It is no longer true, because if the curtain rises again, it will rise on the final act of the human drama.

7.32 p.m.

The Earl of Bessborough

My Lords, it is a great privilege to follow the noble Lord, Lord Boothby, in what he said. He is one of the great Europeans, one of the more far-sighted of all the Europeans, and we have just heard what I understood to be his valedictory speech. I cannot believe that this is in fact the last time that we shall hear him in this House. I hope we shall hear from him often again, but certainly if it is his last speech we do not grudge him one minute of it.

As the first, and then only, British vice-president of the European Parliament, in which I served with my noble friend Lord O'Hagan, I should like to join with others in saying how happy I am to support him in his Motion. I am very glad that he joined our Benches in both Houses, both on this side of the Channel and across the Channel. He is a great asset to us and I certainly agree very much with the tenor of his remarks and indeed with all that he said. I congratulate him on a brilliant and indeed original and exceptionally able speech.

I feel I must also congratulate the maiden speakers because I know full well the great work which the noble Baroness, Lady Ewart-Biggs, and her husband did, both in Paris and in Brussels, and I hope we shall hear from her often again. I do not know that I need spend too much time in congratulating the noble Lord, Lord John-Mackie, because he has already been congratulated by his noble brother, but we appreciate greatly what he said about agricultural matters.

When we consider that from the date of our entry in 1973 to March 1981 we have received from the six major sources of Community aid some £4,500 million sterling, I do not think we can lightly consider leaving the Community. Nor when we realise, as has been said by others, what a large proportion of our exports now go to other EEC member states should we risk leaving and perhaps see a tariff wall go up against those exports. When we think that the Community only costs us—and this has been calculated by experts—13p per week per head, this does not seem to be a high price to pay for security and stability in Western Europe, a stronger voice in the world and free access to a market of 270 million consumers.

I will not repeat what my noble friend has already said and what other noble Lords have said, but what I should like to emphasise this evening is that I think—and I am not so pessimistic as the noble Lord, Lord Boothby—that the climate may well be right for some progress in European integration during the effective four and a half months of the United Kingdom presidency. I say this not only because of the remarkable ability of my noble friend the Foreign Secretary, who will be President of the Council from 1st July. We all know the very considerable contribution that he has already made in developing political co-operation, reacting faster than we did over Afghanistan, reducing our contribution to the budget and proposing that it should be restructured, including the CAP. His remarkable Hamburg speech earlier this year showed how European-minded he is and he has demonstrated that also in his speech today.

I am hopeful not only because my noble friend will be in the chair as from 1st July but also because some notably encouraging speeches have been made of late by other Foreign Ministers in the Community. I think particularly of my old colleague Signor Emilio Colombo, a former president of the European Parliament whom I got to know well and now the Italian Foreign Minister, whose speech earlier this year in Florence inspired new hope when he said that we must relaunch the idealistic aims which are the basis of a united Europe.

He also emphasised—and I agree very much with him in this—that far greater financial backing for the Communities' technological efforts was needed to effect the rebirth of European industry and the funding of the necessary research. He, too, made important proposals regarding European political co-operation, not only within the Community but outside it, through the Lomé Convention, with the Mediterranean countries, some Eastern countries and in Latin America.

It is a remarkable fact that the Community often seems to be more greatly appreciated outside it than among some of the member states themselves. I have noticed that very much in travelling in other parts of the world. As Signor Colombo said, the political weight of the Community is far, far greater than that of the sum total of the individual member states. That reminds me of the famous remark made, I think, at the beginning of the Second World War when Field Marshal Smuts said that the whole is greater than the sum of the parts.

Economic integration is indeed an absolute prerequisite but it is not enough to achieve political union. This must go hand in hand with a plan of a politico-institutional nature which will allow gradually a widening of policies from the national to a European level.

Another encouraging speech in favour of European political unity was also made by Herr Hans-Dietrich Genscher, the West German Foreign Minister, in Zaarbrü;chen in May of this year. From the European point of view I am also, perhaps paradoxically, encouraged by the election of a Socialist government in France, because I usually found during my six and a half years in the old European Parliament that on many issues the French socialists were by and large more European-minded than most members of other French political parties. Therefore, even if one would not like to see introduced into this country M. Mitterand's policies in regard to the nationalisation of industry and the banks, none the less at the European level, and with M. Cheysson (whom the noble Lord, Lord O'Hagan, and I know so well) as Foreign Minister, I believe that some progress will be made. He is a European-minded man, too; he was, as we know, for many years a commissioner. I believe he will make an admirable Foreign Minister.

I believe that, with the four principal Foreign Ministers I have mentioned, they together could make some progress. When one thinks that the Benelux countries are in any case perhaps more European-minded than any, that the Irish Republic and Denmark are also net beneficiaries, and that Greece will probably be so too, I sincerely believe that there is some hope that new initiatives may well be more generally accepted during the United Kingdom presidency, and subsequent presidencies during the next few years, than they have been before.

Rome was not built in a day, but I think the time is becoming ripe for some gradual improvements in the functioning of the European Communities' institutions. As I think the noble Lord, Lord Boothby, said, we must regain the political will for European unity which existed immediately after the Second World War, which he described so effectively in his historical perspective.

In which fields might a new initiative succeed? I was most interested to hear my noble friend the Foreign Secretary say recently—in the Select Committee over which the noble Baroness, Lady White, presides—that some progress might perhaps be made in developing a European energy policy, and I sincerly hope that it will be possible for my right honourable friend the Secretary of State for Energy to put forward proposals during his chairmanship of the Energy Council. I hope and believe this will happen; I have reason to believe that he will be doing so. Just as I hope that further progress will be made in political cooperation and restructuring the budget.

I had always hoped that our common membership of the EEC might help resolve the Irish problem, and I am very glad to read today of the imaginative scheme by which considerable Community funds will be applied to encourage tourists to visit areas around the border between Northern and Southern Ireland. No doubt the noble Earl, Lord Longford, may have something to say on this. This, I believe, is a limited but highly imaginative scheme, which I understand has been approved in outline by the EEC Foreign Ministers. I hope this may make a contribution to improving relations between North and South.

I must say in conclusion that I very much admired what my right honourable friend Mr. Harold Macmillan whom the noble Lord, Lord Boothby mentioned, said very recently to the Conservative group for Europe. It was quoted in The Times. He said that Europe should have a united foreign policy, a united defence policy, a united monetary policy, and treat itself as one nation to resist the dangers with which it is threatened. We should not lose sight of these lofty ideals. If we are able to attain them, how much greater, in the context of my noble friend's Motion, would be the advantages to this country of our membership of the Community.

7.44 p.m.

The Earl of Longford

My Lords, it is a great pleasure to join the noble Earl, Lord Bessborough, who has just spoken with so much knowledge and wisdom, in paying tribute to the noble Lord, Lord Boothby, that great European. I know Lord Boothby is an almost fanatical admirer of the late Mr. (later Lord) Lloyd George; in any comparison he always, I believe, rates him higher than Sir Winston Churchill. Perhaps he will allow me to use words of Lloyd George and to apply them to him. Mr, Lloyd George was once asked by somebody, probably Lord Riddell, what was the greatest opening to a speech that he knew of. Mr. Lloyd George quoted something said by the American orator, Bryan, which went, as far as I can remember, like this: Some will say that I have run my course. Some will say that I have not fought the fight. But no one can say that I have not kept the faith". I join the noble Earl, Lord Bessborough, in saying that we do not believe this is Lord Boothby's swan song; we hope it is just the prelude to many swan songs. So I do not believe for a moment that he has run his course. We can all agree that he has kept the European faith alive through good times and bad, but I would not agree that he has failed to fight the fight. I think he has fought harder than anyone who comes to mind at the moment on behalf of Europe and this country.

The noble Earl, Lord Bessborough, asked me to agree that it was a good idea that the EEC should give tourist assistance to Ireland. So far as I am concerned, let the assistance be given to all parts of Ireland. I am not quite sure what parts they have selected, whether they have chosen absolutely the right parts, but as far as I am concerned, let them take the most constructive interest in Ireland in that or in any other form. I would, of course, not fail to pay tribute, talking of Ireland, to my dear friend, as she has become in recent times, Lady Ewart-Biggs. She spoke, as I knew she would, in a way that impressed the whole House, and I know that we will want to hear her again very often. Unless I mistake her character, we shall hear from her very often again, and I believe that to be a genuine pleasure in store. I did not, I am afraid, hear the other maiden speaker, but I heard that he also was excellent.

The main arguments have been deployed inevitably by this time. I will not say much about the economic case. I have long believed in it; I suppose I advocated it in debate in this House 20 years ago, and have advocated the economic case ever since. But I realise that the case becomes much more overwhelming if the terms are better than they are now. The noble Lord, Lord Carrington, with whom I once did battle on more or less equal terms but who has now become a world figure, to the great pleasure of old timers in this House, made clear that he is going to fight for a big improvement in the terms, and I think if anyone can obtain them it is likely to be him. I will not say any more about the economic case, except to say that even as things are I still believe the balance of advantage lies in membership.

I will say a few words about what is sometimes called, used to be called and perhaps is still called, the political case. The most consistent and brilliant opponent of the Common Market—apart, of course, from my noble acting leader, Lord Bruce—has been Mr. Douglas Jay. He has been kind enough to refer to me in his memoirs Change and Fortune in this way. He explains how he felt compelled to proscribe from a much valued friendship with Mr. Roy Jenkins, long before the latter joined the SDP, because of Mr. Jenkins' devotion to the cause of Europe. About myself he was kind enough to say this: I felt no disillusion towards him as a pro-marketeer. He was a devout Catholic, and I had noticed that for many such the Common Market tended to be equated with Christendom and Eastern Europe with anti-Christ". I am grateful to Mr. Jay for anything nice he says about me, even though he did not get my motivation entirely right. I would prefer to put my overwhelming conviction about the rightness of the political case for British membership in traditional socialist terms. You do not have to be a socialist to appreciate the immense political benefit of the Common Market itself.

Reminiscences seem to be the order of the day, at any rate since Lord Boothby spoke to us, and I myself shall never forget the immense wave of hopefulness that passed across Western Germany, at a moment when despair was a much more common feature, at the time that the European idea first came to the surface in early 1948, and Lord Boothby, I know, was associated with it from the early days. I was the Minister for the British zone at that time. I agree with what the noble Lord, Lord Carrington, has said in other terms: the reconciliation of France and Germany can surely be regarded as the finest political event since the end of the Second World War, one that certainly seemed quite beyond human expectation when the war ended.

It was, in my eyes, a tragedy that we hung back when the Schuman Plan was first propounded in about 1950. It happened that I visited at that time Dr. Adenauer. I was Minister of Civil Aviation; I had ceased to be Minister for Germany. However, I visited Dr. Adenauer at the time when the British attitude towards the Schuman Plan had not been announced. Dr. Adenauer, who was not, of course, the commanding figure that he became in later years, though he was quite commanding, begged me to try to persuade the British Government to join the Schuman Plan. I returned. I had no particular standing because I was a Minister outside the Cabinet. However, I did my best.

I was brushed off with a comment, which I believe emanated from the Treasury, that we would be tying ourselves to a corpse. That was rather ironical when one thinks of the present situation. The argument now is that we are only village cricketers and we cannot afford to belong to the MCC. However, the argument then was that we would be tying ourselves to a corpse. Thirty years later, whatever we may or may not think about British membership of the EEC, we must surely acknowledge without qualification the huge contribution that this European fraternity has made to world peace. With great respect to my acting Leader Lord Bruce of Donington, I think that he also was ready to join in that kind of tribute.

However, the question to which we are addressing ourselves tonight is slightly different. We are asking ourselves not whether the EEC is conferring blessings on the world, but whether we ought to remain members. Now I am speaking particularly to my Labour friends, who are moderately numerous, at any rate in quality—they are high ranking in quality. Many of us joined the Labour Party—and many young people I hope still join the Labour Party—because we believed that it stands for international brotherhood more than any other political party. But the phrase "international brotherhood" can mean much or nothing—positive dedication or pure waffle. Certainly I have always understood that it involved some limitation on our complete freedom of action in favour of some international body. I must not get involved with the word "sovereignty". It is such an emotive word and in some circles a dirty word. I shall avoid the word "sovereignty". However, I assume that if one becomes involved to the extent that we are involved in the EEC, one's action is not as free as it would be if one were standing away from it all.

Twenty years ago I was seeing a great deal of Lord Attlee in this House and elsewhere in the last stage of his life. I was supporting him as best I could in his gallant exertions on behalf of world government. My noble friend Lord Beswick was at least as active as I was in supporting Lord Attlee in favour of world government at that time. Lord Attlee, as older Members of this House will recall—and the noble Lord, Lord Carrington, will certainly remember—was in fact opposed to British entry into the Common Market. He argued at that time that what he wanted to see was a limitation of our freedom of action in favour of an international body and not in favour of a particular group of powers. That was where he and I disagreed on the EEC, although I agreed with being one of his acolytes as regards world government.

Today no one can suppose, in view of Soviet policy since then, that world government in any practical sense can come about in the foreseeable future. I wish it were otherwise, but we cannot talk as if that were the alternative. We cannot talk as though if we do not go into the EEC, we can move in some mysterious way into some wider grouping. There is no such wider grouping available at present. We must face that fact. Therefore, the choice today is between accepting a limitation of our complete freedom in favour of a group of friendly powers or simply suffocating ourselves in our tight little island.

The danger before the Labour Party today is that we shall degenerate into a party of isolation, ignoring the interests of everyone except ourselves and not understanding those in any very enlightened fashion. If we proceed along this path we shall make a mockery of any claim to be an international party. We shall be the party of nationalism par excellence, of a negative chauvinism, and I am afraid that those who have joined because they hoped to see an international party will be sadly disillusioned.

Some of my esteemed friends, some of them still remaining with us tonight—the noble Lord, Lord Kennet, has spoken and the noble Lord, Lord Walston, will soon be speaking to us—have been so depressed by this prospect that they have defected. I said to one of them the other day—not one of the noble Lords here tonight, but another noble Lord—"I at least shall not defect". To which he replied, "I suppose you are a bit too old to defect", which, I suppose, is one rather unchivalrous way of putting it.

However, that is not my sole reason for standing by the old firm. If your father takes to drink you do not, I hope, throw him over. You lock up the brandy bottle when he comes to dinner. You offer up prayers and you do what you can to bring him round to a more austere way of life. I have belonged to the Labour Party for 46 years, and if anyone says that I belonged to another party first, I would point out that at least that gives me a means of comparison which is not open to many Members of this House. However, the issues here are far deeper than questions of personal allegiance. The economics of this business are capable now and always of being argued in all sorts of directions. But I implore all those who are critical of British membership of the EEC, whether in my own party or out of it, to hesitate long and painfully before they press for our withdrawal. I could not imagine a greater disservice to the peace of the world or to the survival of life on this planet.

7.58 p.m.

Lord Lucas of Chilworth

My Lords, I do not think that I shall be critical this evening, but if I am it is not in a spirit of destruction, because I totally believe in and totally support our membership of the Community. If I were 20 or 25 years younger I would probably belong to that group of young people who are perhaps now disheartened. They have seen in the last 35 years since Winston Churchill's very famous speech in 1946 in Zurich, the hesitations, the stops, the starts and the failures of the Community. They have seen, possibly because of the way the media report things, the now almost annual confrontations between Ministers over matters relating to the common agricultural policy, fishing rights and our contributions. That is not really what the Community is at all about.

There is within the Community, as we all know, a huge diversity of resources, of cultures and of traditions. The traditionalists will probably say that we should keep our own, and one must, of course, agree because one has to keep one's own identity. Nevertheless, we have to share them. We have to share them to form the kind of universal bond that I think we need between European peoples that will ensure the lessening of any possibility of future strife. We must remember that the kind of people about whom I have just been talking have no real memories of strife in those terms. All they can do is read the history books, listen to their fathers and mothers, and believe perhaps only part of what they are told. I think that we must share our ideas and our aspirations in order to advance considerably broader views that will make some contributions to economic and industrial strength.

If a bond in Europe is to provide anything of a balancing power, I believe that it must be economically very strong. Even if what I say may smack of some protectionism, I do not apologise for it. I give one example where I believe that there should be far greater co-operation; that is, in industrial and technological spheres. It was my noble friend Lord Bessborough who spoke about this in general terms; I want to speak about it for a moment in more detailed terms.

I look at the European motor-car industry which is in total and absolute disarray at this moment of time and threatened by Japanese expansion. Yet we cannot get our heads together with our European colleagues. The aircraft industry seems to have done so, but the motor-car industry has not—apparently it cannot. We are now contemplating co-operative deals of one kind or another with those very people who threaten the entire European industry, not just car-making, but all the bits that go towards making motor-cars. So I say that the Community should seek to find ways of sharing technology. It must advance at a parallel rate that will ensure that there is not necessarily an emergence of one particular nation within the European Community that would have a single dominating force, because that surely will upset both our social and economic balance.

I am a very fortunate man because I have young children whose friends come to the house and talk about these matters. They are not unintelligent, although they may be, and I believe that they are (and I address this to my noble friend Lord O'Hagan) uninformed as to what the Community has achieved. If one looks at the Community through the eyes of young people, one sees a power struggle within the Community, with different countries trying to reach an ascendancy over others in certain areas. This has destroyed some of the faith which some of us may have in the Community. There is top heavy bureaucracy which seems to contribute to a building up of self-protection of each country instead of an identification of the common needs.

I think that it was in 1970 that Commissioner Davignon made certain proposals as to how the Community should move in a common interest, but since that time his proposals have never been discussed and have never been really thrashed out; they lie in limbo. I cannot remember exactly who said it, but one of my noble colleagues said that there is a greater appreciation outside the Community of what the Community is doing. I think that that is a pretty fair comment. I ask: are we going too fast too quickly? I suggest that indeed we are. We are looking to be the world force before we have resolved our own aspirations. There should be far greater exchange of ideas and ideologies, for example, in student and worker exchange systems, where the younger people in particular and those who create our wealth understand how the other people are thinking and who can join in with it and come back home and spread that kind of gospel. That is how we shall get the wider appreciation of the long-term issues throughout the entire nation; and if they are in our own interests in the short-term, there is nothing wrong with that.

I do not believe that these long-term issues have emerged in the Community over the last 20 years. I believe that the kind of views that have emerged are a mirror reflection, perhaps on a smaller scale, of world power games. I do not believe at this time that we are showing within the Community a common expression, a common aim and a common purpose. If we are to change that to our advantage, the advantage of the Community and then perhaps of the rest of the world, we need to express new initiatives now.

It is, of course, a great delight to us that my noble friend the Foreign Secretary should take up the chairmanship of the Council next month. If we are not careful, I think that we shall put upon my noble friend's shoulders too heavy a responsibility. A number of noble Lords have said to him, and I shall say exactly the same, "We look to you to do all those things that we want", all of them in such a short space of time. I do not know how much he will achieve. If he said to me, "All right, what is it that you want me to achieve?", I should say that there are three areas where I should like to see new, fresh initiatives. One is in the industrial co-operation field. That it may be protectionist I do not deny. If we do not protect our European industries, we shall not create the wealth that will lead to us being able to influence other powers and the world generally. So I start there. That is where I should like to see my first initiative made.

My second one would be in the field of education, education in quite the broadest sense—and I would probably go along a little with what the noble Lord, Lord Vernon, said earlier—so that there is a mutual understanding at a personal level, and so that we understand what it is we all wish to see within perhaps a narrow field. When we get that right we can move on.

Lastly, I should like to see a fresh initiative in the field of defence, defence again in the widest sphere. I do not want to get involved in an argument over nuclear or conventional, or who will look after which frontier, and so on. I think that as a nation we have to believe that our defence in Europe is sufficiently strong; that we can be secure—not secure in a prissy kind of way, but secure to pursue the sensible and the peaceful objectives which are the hallmark of the Community. It is for that reason in particular that I believe we joined.

8.8 p.m.

Lord Beloff

My Lords, as a newcomer to your Lordships' House, perhaps it falls to me to say—I think that I am the first person this evening to say this—that our debate on the very useful Motion put forward by the noble Lord, Lord O'Hagan, has not so far represented the way in which the debate in the country is going. I would imagine that in this House there is a much greater consensus than at present exists among our people. Because in the country the case against remaining a member of the EEC is strongly supported in quarters—in sinister quarters, if you like—which would also like to see the dissolution of our alliances and our defences largely removed. Therefore, there is about this not merely an alternative economic policy thought up by some people in Cambridge, but an alternative view of what Britain's political role in the world should be. Therefore, the issue is naturally hard-fought, because it goes to the very roots of our being as a people.

With those arguments however—and perhaps that it is the reason why they have not figured much in the debate today—I think that all of us, or nearly all of us, are capable of giving a reply. We know what it is we believe in. We think we know what the alternative is. The point I should like to take up this afternoon is not that point, but rather the danger of getting led away from the main issue before us, which is: Do we or do we not remain members of the European Economic Community. with all that that implies?

I feel that in the speech made by the noble Lord, Lord Bruce of Donington, we had an example of something much harder to deal with; namely the obfuscation of this issue by bringing in a series of considerations—some of them relevant and some of them somewhat less relevant, but none of them central. Indeed, at one point in the noble Lord's speech I wondered whether a common fisheries policy did not simply mean a larger shoal of red herrings. Although it is true that there are important institutions—there is the OECD, the Council of Europe (about whose ambitious beginnings the noble Lord, Lord Boothby, reminded us), and so on.

None of these is central to the point of European co-operation based on the common management of our internal economic concerns, to which the noble Lord, Lord Lucas of Chilworth, referred, and increasingly to the management of our relations with the wider world—which the noble Lord the Secretary of State has assured us is so. This is the central issue, which must not be allowed to slip away in phrases such as "We could be part of Europe without being part of the EEC". I believe that at one point there was a possible development along those lines. If for a moment I may, like other noble Lords, be reminiscent, I recall that in the 1950s I wrote a report for the Council of Europe in which I suggested that it was still open to have a wider grouping than the one which was beginning to design itself around the Messina and Brussels conferences. But those days are passed. Europe is now set on a particular course. We could withdraw from participation and see what the effect would be, but I agree with other noble Lords that the effect might be catastrophic. What we cannot do is to tell Europeans now that there is an alternative form of Europe in which they could all join.

Furthermore, there is a great practical danger in following that line of argument. The practical danger is that it would weaken the role of our negotiators, the Foreign Secretary and other Ministers in relation to those admittedly imperfect elements in the treaty from our point of view. One cannot repeatedly say "We would like you to change the rules. We would like you to take into account our very special position, but of course there are large numbers of people in our country—and only in our country in the EEC—who would be quite glad to be out of the Community. If you make concessions to the present Government, which is in favour of the Community, we cannot give you an assurance that some future Government will not say 'Thank you very much, but we are not staying in the Community anyhow'". We must create a consensus of opinion that, for better or for worse and whatever our original opinions may have been, this is the course on which Britain has now embarked and that there is no other course compatible with either prosperity or security.

The second and only other point I have to make relates to another method of obscuring the issue which is to say, "We are not particularly concerned about coming out of the Community. All we want to do is to recapture the sovereignty of Parliament". This argument is one likely to appeal, because whatever one might think about individual politicians, Parliament still has a high rating in this country. And yet this argument is entirely misleading because one of the features of the kind of organisation derived from the Treaty of Rome—and to some extent this is also true of our membership to the Council of Europe so far as it affects the field of human rights—is that in these areas we have in fact chosen as a people through our Parliament, and through a referendum in the case of the EEC, to follow a course to which the traditional element of parliamentary sovereignty as it was defined in the 19th century is irrelevant and it does not apply.

Lord Bruce of Donington

My Lords, before the noble Lord departs from that point, will he please say, completely unequivocably, whether he is in favour, as part of the development of the EEC as he sees it, that ever-increasing power should be given to the Members of the European Parliament who are democratically elected by their respective states?

Lord Beloff

My Lords, I do not know that my personal opinions on a matter for which I have no responsibility are of sufficient interest to your Lordships' House for me to be asked to give them. If the noble Lord wants to know, I would naturally assume that the development of the European Parliament will continue. It started later than the other institutions, but from what we know about constitutional development either in other individual countries or in a broader field there is no reason to believe that that broader representation will not play a major role in the future.

I should like to return to the point I wish to make about parliamentary sovereignty, which is that we are involved in an organisation—to some extent, as I said, in two organisations—where we have said that on certain matters decisions will not be taken through our ordinary procedures. This is now beginning to affect, and will increasingly affect, our domestic law. It is a well-known fact and one that has been stated by our leading jurists—by the noble and learned Lord the Master of the Rolls, and by the noble and learned Lord, Lord Scarman—that this process of legal change in our situation is now something which is irreversible. When we talk about education, we know that it has become part of the education of law students in a way which would have been unnecessary a generation ago. We may or may not like these developments but they have happened, and no one does a service to his cause by suggesting that the choice we are being asked to make—or which we may be asked to make main in an election or a referendum—is not one of great seriousness, which we must consider with all its implications, without being diverted from the central issue.

8.19 p.m.

Lord Walston

My Lords, we are getting towards the end of a long, highly interesting and worthwhile debate. Already a number of things are outstanding in my recollections of this debate. First, there were the two maiden speeches. I will not say more, because they have already been referred to by my colleagues on these Benches, but I should like to repeat that those speeches were magnificent contributions so typical of the two people concerned. How fortunate we are to have them in your Lordships' House. The second point that stands out in my mind was the masterly speech made by the noble Lord, Lord O'Hagan, who covered in a remarkably short period of time almost all the salient factors in this debate. He was followed by his noble friend the Foreign Secretary who made, as one would expect, a forceful and strong speech and one with which I am happy to say—and I hope it may give him some minor pleasure—I was in complete agreement. Usually I find myself in agreement with him on most things, but usually I have some reservations. On this occasion I had none.

Then we came to the speech of the noble Lord, Lord Bruce of Donington. The only thing that I shall say about that is that the speech to my mind was best described by Adam Smith who, I believe, once wrote, "it must be hard for an intelligent man to speak what he knows to be nonsense, or near nonsense." He spoke it magnificently of course, rumbustiously and full of enthusiasm, but as I know him to be an intelligent man he simply cannot believe all, or indeed any, of those things that he expects us to believe. His dilemma of course is exemplified by the speeches which we have heard from those sitting behing him on the Labour Benches; all of them, in their different ways, strongly in favour of our remaining in the Common Market.

My noble friend—and I shall still call him that—Lord Longford, spoke of us sitting here as defectors. Maybe that is a perfectly correct way of describing us, but alas! there are certain occasions when one has to leave one's old friends and one's old associates. We all of us took—and I am speaking only for myself—a long time to make up our minds. It was not an easy decision. There were many factors involved, but one of the outstanding factors was the position of the Labour Party on the Common Market. Whatever the noble Lord, Lord Bruce, may say the Labour Party conference has affirmed its intention of the next Labour Government withdrawing from the Common Market. Unless a remarkable change takes place, which is most unlikely in the present circumstances, even with the efforts of those noble Lords who have spoken, that will be party policy binding the next Labour Government.

The Earl of Longford

My Lords, may I interrupt the noble Lord? The noble Lord, Lord Walston, cannot have got so much out of touch with the party to which he has contributed so much over many years to suppose that the Labour Party conference decides the policy, the manifesto, on which the election is fought. He knows that is just not so.

Lord Walston

My Lords, the power of the Labour Party Conference, as I understand it, has always been strong and it is growing enormously in strength now, and that is one of the reasons for the present difficulties, alas!, within the party. I, for one, could not urge my friends, and those who have a vote in the next general election, to vote for any party which is committed to taking us out of the Common Market. I believe it is one of the cardinal points of our policy that we must remain in it, and that we must fight to improve it. Of course, there are things to improve, but to urge people to vote for a party committed to taking us out is something that I am afraid—not I am afraid, I say, quite categorically, I could not do.

I shall not go through the various arguments. They have all been admirably deployed, particularly the economic arguments, and to a certain extent the political arguments. I shall do no more than advance one further reason which has just marginally been touched on by one or two speakers, and that is the European contribution to the whole world. Of course this country has made, and will continue to make, a great contribution in Europe itself and in the world. But although there is a strong history behind us of British culture—of English, Scottish, Irish and Welsh culture—there is also intertwined with our British culture the culture of France and of Italy; the culture of Germany and the Low Countries; the culture of Scandinavia, of the Iberian peninsula, and stemming way back, from the culture of Greece. That has formed itself into an amalgam of a form of culture, a form of civilisation, of which I am very proud indeed and which I believe has an enormous contribution to make in the future centuries; not simply the next decade or so.

We have on either side of us the two great powers. We cannot attempt to compete with them in military or in economic might; we, as an island, on our own. But the world would be a much poorer place, quite apart from the increased risk of war, if the destinies of the world were left solely in the hands of the United States and the Soviet Union. There must be a strong voice putting forward all that Europe over thousands of years has stood for. I believe that that can best be done through the beginnings, the modest beginnings, of the present European Community enlarging, as it is at the moment, with Greece, and with Spain and Portugal soon to come in, and eventually one hopes the other countries not only in Western Europe but possibly in the distant future some of the countries of Central Europe also. The contribution that that body can make, with its 250 million people, to world civilisation is something which must not be overlooked. It is something where we can play a very great part indeed.

The Community is only starting. It has been going for barely a quarter of a century. It takes a long time for new powers in the world to arise, but growing as it is, overcoming some of its teething problems, struggling rather ineffectually with others, I believe that within a short space of time the voice of Europe as a whole will have a vast and beneficial influence in the councils of the world. If this country were to leave the European Community not only would our voice be missed because it is a significant voice, but as one noble Lord who has already spoken pointed out the danger of a complete disintegration of the European Community is that much greater. So for that reason, as well as for all the others which have been so ably deployed during this debate, we must remain in Europe as active, positive, and enthusiastic members of the Community.

8.28 p.m.

Lord Stewart of Fulham

My Lords, it was inevitable that in a debate of this kind many statistics should be quoted, and I do not propose to add to them. It seems to me that if one is trying to strike the present balance sheet in its simplest form, one can say this: there are certain obvious disadvantages to Britain in membership of the Community, notably the present working of the common agricultural police and the present form of the budget. Those are both capable of remedy. Indeed, as the noble Lord, Lord Gladwyn, pointed out, they are in effect bound to be remedied because the Community will not be able to afford to leave them as they are.

But if we British spokesmen in the Community are trying to get improvements from our point of view, we can only do that with reasonable hope of success if our partners in Europe believe that if our grievances are remedied we shall stay in. If they suppose they are dealing with a British Government which will always find one reason after another for objecting and saying that they are going to go out, they will decide that they may as well do without us. I would not agree with the noble Lord, Lord Kennet, that British withdrawal would be followed by other withdrawals. I think the countries of continental Europe would decide that we had reverted to our deplorable isolationism and that it was probably an incurable disease.

Against that, there are the massive advantages to our export industries and investment in this country which membership brings. Nobody can dispute that if we were to come out we should be putting a great block of our exports at risk and should be greatly reducing the possibility of investment in this country. The EEC is, in that sense, a very solid fact and it would go on even if we went out. The nations remaining in the Community would continue to enjoy the advantage of a huge guaranteed market and to attract investment, both of which would make all the economic problems in this country more difficult to solve than they otherwise would be. I will not put it more strongly than that.

I was not one of those, if indeed there were any, who in the arguments at the time of the referendum argued that we should be bound to become prosperous by going in. But I held then, as I hold now, that practically all our economic problems would be made more difficult if we stayed out or if we go out now. If we go out the others would remain, enjoying assured markets, the prospect of investment and, as the noble Lord, Lord Mackie of Benshie, said in a speech to which we listened with great interest, the advantage of an assured food supply.

It being a solid fact like that, we really must decide whether we are in or out; there is not really for us any sort of halfway house. A country like Norway may expect to make special arrangements. A country with the advantages we can get from membership cannot expect to be given exceptionally favourable terms. If we are in, we must be in in accordance with the terms of the treaty or any modifications of the treaty that may subsequently be agreed.

If I understood my noble friend Lord Bruce of Donington aright, he wanted us to go out by instalments—not immediately and in one fell swoop, but step by step—and I confess I am not sure that would be practicable. I do not for the life of me see why our European partners should agree to an arrangement which would be extremely inconvenient for them and, frankly, I am not sure I know what it would mean. At any rate, at some point we should be out and we should then be faced with the external tariff, with threats to our exports and investment and removed from the assurance of an assured food supply.

I wish to develop briefly this question of being in or out and there being no subterfuge between the two. To my great regret, there are some in my own party who say quite unequivocably, "We want to come out". There are others who do not say it in those terms but who say, "We shall amend or repeal the Act of Accession", or, as the noble Lord, Lord Beloff, quoted, "We shall regain our sovereignty". Let us be clear about it. In the full and strict sense of the word, we have not sacrificed our sovereignty, otherwise we could not talk of going out. There have been examples in history where states have sacrificed their sovereignty; for example, when the state of Texas decided to join the United States, that was a final and irrevocable sacrifice of its sovereignty which it deliberately and voluntarily made. We do not do that and we have not done it by going into the Community. It is true that there are certain decisions made through the organs of the Community which become part of our law, but they do so only because the Act of Accession says they do.

The thing on which it all rests is an Act of this Parliament, and it is this Parliament at Westminster which remains the sovereign authority in this country, and it can decide if it wishes, and as it has decided, to make a very considerable pooling of sovereignty with other nations. If you decide that you are going to abandon that decision—to say, "No, the decisions of the Community which at present become part of our law will not do so unless this Parliament approves individually each one of them"—you are in effect going out of the Community; you are saying that you will not perform one of the obvious obligations of membership of the Community. You cannot have it both ways and it only obscures counsel to pretend that you can.

I spoke of the Community as at present a solid fact and mentioned the effect on our exports, on investment and on food supply. But of course it is not a static fact. It has already shown great powers of movement and development. If one reads the text of the Treaty of Rome, it seems to be at first sight the purest Manchester economics, the virtues of free competition and all the rest of it. In practice, of course, the Community has been becoming ever since more and more what the French call di rigiste; the deliberate manipulation of public policy for social ends. One sees that in the regional and social funds.

That is one example of its capacity to develop, and it has already shown many other signs. There is the process of harmonisation in many fields and that will go on. In commercial law, law about insurance and so on, there is all that to go on, but is Britain to stay outside? If so, our businessmen and those who engage in commerce will find they are in increasing difficulties, having to deal with rules and regulations built up in which they have had no say and about which they have not been consulted because they are not members of the Community.

It is also being developed into a vehicle of overseas aid, as was shown in the debate we had recently in this House. If we come out, we cannot hope to make a contribution in the field of overseas aid comparable to what the Community is doing. I think we could not try to return to any special association with the Commonwealth countries because more and more they have been looking to the European Community as the body with whom they wish to make trade arrangements. At the very beginning of this argument I was doubtful of the wisdom of going into the Community because I feared it would estrange us from the Commonwealth. But it became more and more apparent as time went on that we should be further separated from the Commonwealth if we stayed out than if we went in, and that is becoming increasingly true as the years go by.

We shall also find the Community developing an energy policy of its own; our absence will not stop them developing an energy policy. They will develop a policy for the environment, and increasingly—I would not be so pessimistic as the noble Lord, Lord Boothby—I think they will return in the end to the question of political co-operation, difficult as it is. One of my clearest memories from my short time in the European Parliament were the debates at the time when the people of Portugal had returned to democracy. There is no doubt that debate in the European Parliament was influential in causing the Commission to act speedily in making certain that the necessary financial help was given to that new democracy in time to save it from disaster. Increasingly the Community has appeared as a kind of magnet, attracting those who are interested in the democratic way of life—Spain, Portugal, Greece—and who, as part of their return from bondage and dictatorship into a community of civilised nations, regard membership of the Community as one of the most effective ways of doing that.

Are we to say that all that is to go on and we shall remain outside? If so, we should not only be economically poorer but politically less and less effective and of less and less interest in the world. There are some who will say this contains the danger of our sovereignty really going—of the Community becoming one day a federation. But I think we would all agree, whether or not we want to see that, that it will be a considerable time coming; and if it comes, it cannot come by stealth. If it were ever proposed to turn the Community into a political federation, that would be an unmistakable totally new step to which we could say "yes" or "no" as we pleased at any time we liked. You cannot slip into a federation accidentally and by the back door. So there is no point in trying to frighten us with the idea of our sovereignty being secretly filched away from us. The question of whether Western Europe will ever be a federation is a separate question that might arise in the future, and it will be up to Britain and every other nation to decide what it wants to do about it.

I shall speak for only a few more moments. I want to look a little further into the possible future developments of the Community, following a train of thought that was inspired in me by the delightful speech of my noble friend Lady Ewart-Biggs. I refer to the possibility of future developments in the Community in creating a Europe with greater justice and greater welfare than it has at present. We have already seen some signs of that. There is, for instance, the concern that is shown in preparing conventions on health and safety at work, and the concern that is now being shown about the possibility of a European policy towards employment.

Those developments might or might not occur, but I think it very likely that they will, and once again surely we ought not to be outside them. Now, with Herr Schmidt in the Federal Republic of Germany, the head of a coalition in which the Social Democratic Party is the leading partner, and with M. Mitterrand President of France, and with every prospect of a strongly supportive Socialist Government, is this the moment of all moments for the Labour Party, of all parties, to say that it will separate itself from Europe?

8.42 p.m.

Lord Banks

My Lords, I think that it will be generally agreed that we have today had a most interesting, useful, and worthwhile debate, and I should like to join in thanking the noble Lord, Lord O'Hagan, for raising this important matter. I also wish to thank him for the speech with which he introduced the subject to us, and for his eloquent peroration, with which I was in complete agreement. It is quite clear that the House has appreciated greatly the maiden speeches of the noble Baroness, Lady Ewart-Biggs, and the noble Lord, Lord John-Mackie; and as many noble Lords have already mentioned, we look forward to hearing both speakers on many occasions in the future.

The noble Lord the Foreign Secretary dealt with the myths and the misunderstandings on which so much of the criticism of the Community is based. He spoke of the lack of any satisfactory alternative to our membership of the Community, and he listed the positive advantages of membership. He underlined the fact that there would be a loss of real sovereignty if in fact we were to relinquish those advantages. As the noble Lord, Lord Stewart of Fulham, has just said, we have in a sense pooled some of our sovereignty in order to gain sovereignty, and that is the difference between the EEC and the other excellent European bodies referred to by the noble Lord, Lord Bruce of Donington. When we compare them with the EEC we are not comparing like with like, as the noble Lord, Lord Beloff, pointed out.

The noble Lord the Foreign Secretary, in referring to the misunderstanding, spoke of the lack of information in the country about the Community and the way in which it works. It is true that people simply do not realise, for example, how small a number of people, relatively speaking, are employed by the Community, how small a proportion of our national expenditure is taken up by the Community. They do not realise how small an amount of the increases in food prices that have occurred since we joined the Community can be attributed directly to our membership. Nor do they realise that many of the horror stories that they hear, many of the proposed harmonisation projects, whether they deal with beer, sausages, or our milk deliveries, do not in fact materialise in the long run. They are not put into practice. They are ideas which, if they amount to more than rumours, are eventually turned down. Just because something is proposed it does not mean that one day it will be part of what happens; and I believe that that point is perhaps not fully realised.

I also feel that because they do not have the noble Lord, Lord John-Mackie, to explain it to them, people do not realise that although we must control the surpluses, they are perhaps not as big as we are sometimes led to believe they are. We must get across the positive benefits that are derived from the Community, the facts that we have free trade with our largest export market and that we are now in visible trade surplus with it; that we have a say in what happens in the market; and that in being a part of the market we have links with all the various countries with which the market has made its trade associations. There is also the fact, as the noble Lord the Foreign Secretary pointed out, that we have economic influence throughout the world due to our being members of the largest trading entity in the world.

Not only do we have those advantages; we also have opportunities. We have opportunities to improve and extend the Community in innumerable different ways. My noble friend Lord Gladwyn referred to the fact that there will be reform not only of the CAP, but also of the budget, as we know; but this will have to happen in any case, because of the need to deal with the question of the financial resources of the Community. That is one area where there are possibilities for improvement, and I must give it as my opinion that if we are ever to overcome the problem where 75 per cent. of the Community's income goes on agriculture, we shall have to increase the budget of the Community, we shall have to transfer to the Community certain expenses which are now incurred at national level, as was recommended by the McDougall Committee. If we did that, there would be the possibility of developing a genuine regional policy, which we do not at present have in the Community, and there would be the possibility, too, of a common approach to the problem of unemployment throughout the Community. In that respect I agree very strongly with what was said by the noble Baroness, Lady Ewart-Biggs, and the right reverend Prelate the Bishop of Worcester.

If we act together, there is the possibility of applying the ideas, the principles, that are behind the Brandt Report, in our dealings with the rest of the world, and we have the Lomé Agreement as a kind of stepping off point from which we could develop that aspect of things. There is the possibility, too, of improving the working of the institutions of the Community, perhaps through a clearer definition of when the Luxembourg compromise applies and a greater reliance on majority voting, as my noble friend Lord Gladwyn suggested earlier. Perhaps there could be a clearer definition of the roles of the president of the Council of Ministers and the president of the Commission.

The noble Lord the Foreign Secretary referred to the importance of both political co-operation and the need to take that forward. He spoke of his desire to do so and of his conviction that his desire is shared by his colleagues. How will that be done? There is the possibility of a political union that might run parallel with the EEC, but work outside the treaties, and inevitably, at any rate to begin with, on the basis of unanimity. Perhaps that was what the West German Foreign Secretary had in mind when he recently suggested a treaty dealing with political union. But whether it is done that way, or in another way, I feel sure that we would agree with the noble Lord the Foreign Secretary when he expressed a determination to see that political co-operation is taken further forward.

So, in conclusion, I should like once again to say that we have these advantages of being in the Community, we have these opportunities through being in the Community at this particular moment. But of course we have problems to face as well—problems which have been aired this afternoon in the course of our discussions. But in introducing the subject the noble Lord, Lord O'Hagan, said that for him these problems were an incentive to further advance. I can say on behalf of my noble friends on these Benches that we think similarly; we share that attitude to the problems which face the Community. Welcoming the advantages and the opportunities, we face the problems with a desire to advance, and for that reason we totally reject any suggestion of withdrawal by Britain from the Community.

8.50 p.m.

Lord Beswick

My Lords, I have a task which I did not seek in winding-up from this side, but at least it gives me the opportunity to join the congratulations to my noble friend Lady Ewart-Biggs and the noble Lord, Lord John-Mackie. Our House will indeed be strengthened by their presence. I also congratulate the noble Lord, Lord O'Hagan, in giving us this opportunity to discuss EEC affairs. I recognise, of course, his sincerity and his conviction, but I am bound to say that when I first read the Motion, considering all the circumstances, I thought it might have been couched in rather more modest or (shall I say?) balanced terms, because it so happens that there are some disadvantages as well as advantages in our membership of the EEC.

I tended from the outset to compare this debate with those we have had on the reports of our European Communities Select Committees. In those debates, I must say, noble Lords have been less concerned to make a point and more concerned to analyse all the facts. In such debates it would not have been possible for the noble Lord, Lord O'Hagan, to get up and say that our trade to the Community members is £20 billion a year without also going on to say what we were buying from members of the European Community. But the trading problem here is much more complicated than the noble Lord really implied. Of course, there has been a diversion of trade as far as our trading pattern is concerned; but there is no evidence at all that total world trade has been increased by virtue of our membership of the EEC.

The noble Lord the Foreign Secretary said that there was a surplus of £700 million on our trading account, and it is true that there is this surplus after some £20 billion deficit in recent years. But I think also that if we had been considering the implications of this trading surplus we would have had a look to see what had been the effect of oil exports. I doubt very much whether all the paraphernalia of the councils and commissions and the European Assembly has been the reason why Germany has bought North Sea oil.

I agree with my noble friend Lord Bruce of Donington that the Foreign Secretary was rather light in his touch when he came to discuss the cost which we bear. I am not sure, I must tell him, that he is going to make it all that much easier for the Prime Minister to get the next lot of concessions when our fellow members read what a good bargain we are getting out of European membership. But we cannot assess advantages from EEC membership without counting this cost. I will not say that the EEC budget is unfair, for fairness is difficult to define in this context; but on the basis of any criterion I know—and I think this is generally agreed—the financing is absolutely indefensible.

The British people were right in their support for the Prime Minister when she tried to get concessions recently. I am not sure, however, that the British people fully recognise that this is not just a British problem. It is a fundamental and, indeed, probably fatal weakness in the whole EEC approach. One criterion by which the sharing of costs might be judged is their redistributive effect; but under present rules poor countries pay to the richer countries. I understand that more up-to-date figures are likely soon to be available, but they will not controvert the fact that wealthier than EEC-average countries, like Holland, Denmark and France, will be net financial gainers from the various money transfers, and that only Ireland and Italy of the below-average countries will be net financial gainers.

The noble Lord, Lord O'Hagan, spoke feelingly about transfers to poorer countries in the rest of the world, but can he really justify the transfer which is taking place now within the European Communities from the poorer countries to the richer? I find the position as it will affect new members to be equally indefensible. Figures given to the sub-committee on which I now have the privilege of serving show that Greece, not one of the richest European countries, will get relatively small benefits when she joins. With a population three times that of Ireland, its total gains will be one-third those of Ireland. Or look at Portugal. That country, though largely agricultural, needs to import temperate foodstuffs, like dairy produce. The consequence apparently is that on present rules Portugal would be a net contributor. How can this position be defended?

There are, of course, various suggested financial devices designed to make the CAP more palatable. We have the levy and the super levy, and such is the desperation to defend the indefensible that we now have proposed the linear co-responsibility levy. Then there is the possibility of each nation paying part of such aid as would flow to its own agricultural community under the EEC rules. Or, of course, there could be the haggle every two or three years to adjust contributions on some retrospective basis.

I am bound to ask myself whether all the time and nervous energy now being spent devising possible solutions to this problem of sharing costs or an acceptable set of rules could not be spent on examining again, free from all pre-determined positions, the purposes on which this money is spent—not budgetary concessions, but a basically different approach. I say to the noble Lord, Lord John-Mackie, that I am one hundred per cent. with those who say that we must give a fair deal to the farmer. I accept completely that measures are necessary to enable long-term planning and a fair return in the farming industry, despite the vagaries of the weather and market mechanisms. But it just is not necessary to have this costly, bureaucratic superstructure to ensure that we get a fair deal for the farmers of this country.

We could have a simple free trade area in European agricultural produce. I am told that this would possibly lead to distorted competition between member nations. Yet almost every week now we hear stories of distorted or unfair competition, despite the CAP rules. The noble Lord, Lord Sainsbury, told us the other day that the French Government are spending £400 million a year to supplement or circumvent the CAP arrangements. At the other end of the scale we have the splendidly Irish device of the carousel; and in between there is each country using its own methods of looking after its own people.

As a firm supporter of the British farmer, I find it hard to accept a situation where we are having to cut the agricultural advisory services in the United Kingdom on account of cost, and at the same time we are paying millions of pounds to subsidise the comfortable part-time farmer in Germany or the inefficient small-time farmer in France. Incidentally, although I am all in favour of brotherly love, I cannot forbear from quoting to the noble Lord, Lord John-Mackie, behind me, what his brother, the noble Lord, Lord Mackie of Benshie, said the other day in the debate on 9th April. He said of those surpluses that unless something was done—and I quote— the whole business would break down". That is the CAP; and if the CAP breaks down, what then is left?

I thought that the noble Lord, Lord Gladwyn, dismissed too easily the value of a free trade area. After all, it was the free trade character of the EEC that was supposed to give us these mysterious dynamic effects when we went in. Whatever arguments there are about the invigorating effects of open competition, they would have been equally obtained, and at less cost, had we accepted the French proposal for free trade union between EFTA and the EEC.

I confess that I find it difficult to assess the value to us of all the regulations and directives that stream from Brussels. Some conceivably do good. But, surely, it must be dangerous to have all these people sitting there looking for a directive to draft. They certainly make a meal of it when they start. It was I believe the noble Lord, Lord Mancroft, who called attention the other day to the following figures. He told us that the Lord's Prayer is expressed in 56 words; the Ten Commandments in 197; the American Declaration of Independence took longer, 304 words; but the EEC directive on the import of caramel and caramel products ran to 26,911 words. Such is the productivity of some of our servants in the Community.

One of the things which have always baffled me in the controversy about the cost effectiveness of the EEC is the virulence with which some of our Conservative colleagues bemoan and berate the British Civil Service and yet so strenuously champion the idea of another level of bureaucrats, even of Lambeth size, but at an even higher rate of pay. I was never personally addicted to the doctrine that Whitehall knows best but it puzzles me that some should say that Brussels knows better. Among all the alleged advantages, there remains the claim that the political influence of Britain would be strengthened by Community membership and that our values and our interests would be better protected. I found this argument appealing. I have since looked carefully for the evidence and the experience to support that claim. So far, I find it difficult to identify such evidence. The Foreign Secretary said that on Afghanistan there was a clear collective statement from the EEC. I am bound to say that I missed it. I heard what NATO had to say, but not the EEC.

Last week in this House there was a parliamentary Question about certain British nationals detained in Angola. The Government spokesman then, the noble Lord, Lord Skelmersdale, said that there was intense consular activity. I asked if that was supported by similar activity by our fellow EEC members. There was no information available, I was told. Our Government made praiseworthy efforts to look after the interests of British nationals illegally held in Iran. They were partially successful; but I waited in vain to hear that the full weight of our European organisation would be brought to bear in our support on that occasion. When the British Embassy in Tehran was closed, I expected that Germany or France or Holland or Belgium would be offering us facilities. But no, apparently we had to rely on Sweden.

When we joined the EEC—and I argued against it at the time—at the back of my mind I thought that there would be one advantage; that, within the European dimension, that boundary dividing the six countries of Ulster would become less significant. But even there, I have found no real assistance or help towards a solution of that wretched problem. Despite what was said by the noble Lord, Lord Beloff, I felt that I have come to the conclusion that so far the political influence argument has been over-stated.

Having said all that, I hope that it will not be said that I am anti-European. I would have gone along with the idea of a European defence force. Over 30 years ago I was putting to Ernest Bevin and Hector McNeil proposals of what I called functional federalism. I spoke and wrote particularly of the possibilities of getting together—"federating" was the popular word of the time—for such functions as atomic energy for peaceful purposes and aircraft construction. In later years, I have claimed that I did as much for European co-operation when I took BAe into Airbus Industrie as all the EEC directives put together. When I was a member of the AI board I wrote to Mr. Jenkins, then the Commissioner, to suggest that the idea of the EEC helping to fund the new project should be considered. Here was an opportunity to do together what none of us could afford to do separately. Here was an example of maintaining a European capability and frustrating an American monopoly. That, I thought, is what the EEC should be about. I am still waiting for a reply from Mr. Jenkins to that proposal.

If we are talking of Europeans and those who have sought a meaningful Community, I must mention the speech to which we all listened with great interest from the noble Lord, Lord Boothby. He said again this evening what he said in that letter to the Daily Telegraph on 9th June. I thought it one of the saddest things that I had read in recent weeks. He said: The European Parliament is impotent. And the international bureaucracy at Brussels does nothing but promote discord between nations concerned and at enormous expense. The EEC in its present form will, and should, break up". None of us today—

Lord Gladwyn

My Lords, surely the noble Lord is not agreeing with Lord Boothby.

Lord Beswick

My Lords, I am about to make the last sentence of my speech and probably the noble Lord, Lord Gladwyn, will listen to it. I was about to say that none of us would gain satisfaction from brave efforts breaking up, but the fact is that unless the Foreign Secretary can be seen to make a really radical start on the reform of the basis and purpose of the present Community, then the British people will increasingly say that membership has gone on too long for the good it has achieved.

Lord Mackie of Benshie

My Lords, before the noble Lord sits down, the whole House has listened with enormous admiration to his speech, and which he has done so much better than the opener. Will he now say whether he thinks we should withdraw from the EEC?

Lord Beswick

My Lords, my answer is, No. I shall not withdraw like that from any organisation which I have voluntarily joined.

9.8 p.m.

Lord Skelmersdale

My Lords, this debate has been a personal pleasure for me for three reasons. First, I should like to congratulate the noble Baroness, Lady Ewart-Biggs, and the noble Lord, Lord John-Mackie, on their excellent maiden speeches. I hope that we shall hear from them again both soon, and often. Secondly, I should like to congratulate my noble friend Lord O'Hagan for having succeeded in finding time in a crowded parliamentary timetable to debate this important subject this afternoon. It is a lucky and happy coincidence that I should be in the hot seat this evening to respond to this debate as I have known him on and off for over 20 years—indeed, half our lives. Lastly, in spite of what I am about to say sounding slightly odd—it applies now just as well as when I wrote it some three days ago—I have been struck by the unanimity of approach of all the speeches made today to which I have listened most carefully. I am grateful for the wishes for a successful outcome to our forthcoming presidency, and I know my noble friend will be, too.

The debate has clearly provided a useful opportunity to examine and perhaps dispel some of what my noble friend the Secretary of State described as the many misconceptions which abound in the public mind about the European Community. But nobody in this country should make any mistake. This Government are, if it is possible, more than 100 per cent. behind the European Community. Here we have our first problem which we have been discussing throughout the debate. We all realise that the Labour Party is in Opposition. This is a time for reconstructing, rethinking, and everything else, to build up one's ideas for the future. My noble friend Lord Beloff and the noble Lord, Lord Stewart, both came to the conclusion that the current unhappiness within the Opposition over our membership of the EEC was damaging for Britain because, unless we have the co-operation of the two main parties in this country behind us, it will be felt within the Community that it is not Britain speaking, but it is one part of Britain. I very much regret this.

One of the areas in which such misconceptions—the Euromyths to which my noble friend referred—are most numerous is the question of the economic effects of our membership of the Community. This has been the subject of much bitter, and often ill-informed, argument. What my noble friend has said today has I believe helped considerably to clarify the issues, and in particular to draw attention to the many tangible economic benefits which we derive from Community membership. His speech has served further to undermine the claims of those who would have us believe that the United Kingdom, as one of those western nations which relies most heavily for its existence on trade, could possibly be better off if it did not belong to the world's largest free-association, accounting, as we have heard several times, for 20 per cent. of the world's trade—that of course is excluding the trade between its own members—and providing a tariff-free home market of 270 million inhabitants of some of the world's most advanced societies. But what emerged equally strongly from my noble friend's speech was the enormous political asset which our membership of the Community represents. Few people I think now seriously question the proposition that our membership of this group of medium-sized European powers, our participation in the system of political co-operation among the 10 members of the Community, has enabled us to play an immeasurably more influential part in a world of super-powers and multilateral groupings than we could have hoped to do on our own.

It is of interest that whatever public opinion may feel about the European Community in its economic manifestations, opinion polls appear to reveal consistent public support for moves to promote European unity and to develop the system of foreign policy co-ordination. What seems less widely appreciated is the fact that the two aspects, the economic and political, are inextricably related as functions of the Community itself. The co-ordination of economic policies which forms the cornerstone on which the Community is built provides the motor for the co-operation on international political issues which has been an increasingly successful feature of the European venture over the period since our accession.

It is thus an absolute nonsense to suggest, as some do, that we could have one without the other—that we could continue to participate in political co-operation without being full and fully-committed members of the Community. Neither precedent nor logic supports such a possibility; and those who put the idea forward in the knowledge that it is unrealistic are guilty of supreme irresponsibility.

I shall, with permission, now turn to points raised by noble Lords during the debate. The noble Lord, Lord Bruce of Donington, spoke of the European Community as being just one of a number of organisations devoted to European unity, suggesting that we could pick and choose between them and pop in and out as the fancy took us. Other noble Lords have, of course, dispelled this, but I should like to say now that there are two things wrong with it. First, all these organisations do different things. NATO is concerned with the security of the 15 North Atlantic countries— and incidentally there is one member of the EEC, namely, Ireland which is not a member of NATO—and OECD is a grouping of western developed countries, by no means all European, with major economic interests world wide. The Council of Europe—and who would know better than he?—is the guardian of a number of agreements in various humanitarian, legal and administrative arrangements and so on. Indeed, the House had the benefit of discussing two of these Council of Europe treaties when we had quite a long innings on the Wildlife and Countryside Bill recently, which is still going through another place. They impose varying degrees of obligations on every member—great in the case of NATO, slight in the case of the OECD. None has the task or the commitment which the treaties setting up the European Community impose. None has the same degree of common rules or of economic integration. Secondly, no responsible western country takes on or drops obligations to any of these agreements as lightly as the noble Lord suggests. We would lose all respect and all trust and could count on no one to help or to back us. I believe it is a frivolous approach to these serious matters.

The United Kingdom's net budget contribution to the EEC between 1973 and the 31st March, 1981 is estimated at £2,799 million. I should like to put this in perspective. That would represent about 0.76 per cent. or let us say about three-quarters of 1 per cent. of the total United Kingdom's public expenditure for broadly the same period. Is that a lot? For 1981–82, our net contribution is expected to amount to 0.7 per cent., or slightly less of public expenditure.

The noble Lord, Lord Kennet, the right reverend Prelate the Bishop of Worcester and the noble Baroness, Lady Ewart-Biggs, rightly drew attention to the importance of the Community's role in the development of the third world. The noble Lord, Lord Kennet, argued that the benefits of Lomé should not be confined to those developing countries which happened to be former British and French colonies and exclude some half of the developing world. As my noble friend said, Community help for developing countries is not confined to the Lomé Convention. The Community has a programme of aid to non-associated developing countries, a series of financial protocols with countries in the Southern Mediterranean area, a generalised scheme of preferences for all developing countries and substantial emergency and food aid programmes. So far as the Lomé Convention itself is concerned, we must appreciate the enormous financial and practical difficulties of extending the Community's funds to all the countries concerned.

The noble Lord, Lord Mackie of Benshie, rightly pointed out the problem of agricultural surpluses, particularly in milk, and the need to control these. I can assure your Lordships that the Government will press for a reform of the common agricultural policy, with the aim of eliminating these surpluses and cutting the high share which agriculture takes of the Community's budget. I agree that patient negotiation and fine tuning will be needed as well as firm determination; but my right honourable friends do not exactly lack this.

The Government believe that harmonisation has a useful role to play in reducing barriers to trade but should be confined to areas when action at Community level is more appropriate than at the national level. But I agree with my noble friend Lady Faithfull that directives should be sufficiently flexible to allow member states to implement them according to international circumstances. These are complex legal matters which unfortunately cannot be curtailed, as otherwise our industrialists and traders would not get the full advantage of the directives, which of course is of importance to them and hence to us as a country.

My noble friend Lord Bessborough referred to the United Kingdom's attitude towards a Community energy policy. All member states of the Community are developed industrialised economies and thus have a common interest in the question of energy supplies and in the sensible development and use of energy resources. The United Kingdom is already making a substantial contribution to the Community's security of energy supply through our exports of oil and coal. In the next six months, in particular, while the United Kingdom occupies the presidency, we shall seek to work closely on energy matters with our partners and with all the institutions of the Community to carry forward appropriate Community-level action on energy issues.

The noble Lord, Lord Boothby, drew on his experience to remind us of the essential role of the European Community in the search for world peace, and mentioned some of the opportunities that we missed. One of the privileges of being a young man in your Lordships' House is that there is an enormous wealth of experience on which to draw, and I am very grateful to the noble Lord for his remarks.

I think that the noble Lord, Lord Beswick, was casting some doubts on the political co-operation in Europe. As my noble friend said in Hamburg last November, British foreign policy must be conducted essentially in a European framework. Without the European framework, it is substantially diminished. We should therefore like to see this political co-operation strengthened". He also expanded on this theme to your Lordships' Select Committee on the EEC the other day.

We have, therefore, suggested a strengthened commitment to consultation and an improved emergency procedure, with a small permanent staff seconded from member states to support the presidency. Ministers have agreed, in principle, to look at ways of improving this political co-operation and political directors have been asked to make proposals. As I think your Lordships know, German thinking is similar to our own. We welcome Herr Genscher's wish to promote closer co-operation among the Ten, but we do not think that a treaty covering political co-operation is the best way to achieve this. This is a subject which has been of concern for some time, and to which my noble friend is giving a new impetus. I think that we should all be grateful to him for that.

The wide variety of issues which we have discussed today vividly illustrates the way in which membership of the Community has become an established part of our daily lives. As I said, the Government are firmly convinced that this has been to the advantage of all the citizens of this country, and intend to pursue their policy of full commitment to the Community. This means that we are determined to play a full and active part in the crucial period of development and improvement which lies ahead. Our presidency of the Council of Ministers for the next six months will help to ensure that we do this.

We also intend, as my noble friend said in his speech, to do everything we can to emphasise the political meaning of the European Community, by encouraging its members to look at the broader perspectives beyond the daily press of business, to ensure that we do not lose sight of the basic objectives of the venture. Only in this way, will we gain the full support of our peoples which is essential for the successful construction of a Community with which all its citizens can identify, and in which they can all feel that they have a genuine stake. Given the necessary degree of co-operation, popular understanding and support, there is no problem, economic or political, which given time we cannot tackle and overcome together.

The strength of the Community lies in its nature as an expression of the combined political will of a powerful group of advanced western democratic nations. The Government see no realistic alternative for the United Kingdom to full and committed membership of that group, and remain determined to build on what has already been achieved towards the objective of a secure and prosperous Europe, with the United Kingdom as an integral part.

Finally, I should like to take up a point which my noble friend the Secretary of State made recently in his evidence to your Lordships' Select Committee on the European Economic Community on 2nd June. In passing, may I say that this committee, together with its sub-committees, has a well-deserved reputation for thoroughness and constructive ideas on all the masses of paper from the Commission in Brussels, in the form of documents, reports, draft decisions, draft directives and so on. This is, no doubt, due to the robust lead which it has been given by its chairmen, of which I should point out that there have been only three since it was started in 1974. Perhaps, after last Wednesday's debate, I could also point out that no fewer than two of them have been noble Baronesses.

To return to what I was saying earlier, my noble friend said: So often what has appeared in the newspapers have been the problems and the difficulties, understandably". Newspapers have to be profitable and tend to be sensationalist, in order to sell their wares. The careful, painstaking slogging away at Community policies does not hit the headlines, even when successfully concluded.

Even conclusions of previously sometimes overemphasised problems do not get the coverage they should. One should not be too surprised at this as even the mass of day-to-day work at Westminster goes unremarked most of the time.

I believe that we ought to be the best informed nation in the world on public affairs. We should take pride in the fact that the media cover all shades of opinion and it is right that this should be so. But in spite of this it is, as I say, the problems that tend to be put in the forefront of our minds. That is why I welcome the opportunity we have had to debate this important subject today and on this occasion at least to redress the balance.

If I had to sum up today's debate in one sentence, I would say that it has been convincingly proved that the advantages of belonging to the European Economic Community so outweigh the disadvantages that it would be an absolute disaster were a future Government to take us out of the Community.

9.26 p.m.

Lord O'Hagan

My Lords, it is late. Scotland and Selkirk call. However, thanks are due not only to those noble Lords who have spoken—I should thank in particular those who have been kind enough to say agreeable things about the fact that have brought this Motion before your Lordships' House—but also to those who have listened, particularly those from my constituency in Devon.

I should be in a difficult position if I were giving rosettes at a show. It is always customary in your Lordships' House to over-indulge the Turkish delight when congratulating maiden speakers, but today it is not difficult to do this. In the contribution made by the noble Baroness, Lady Ewart-Biggs, I recognised one of the authentic forces of constructive European socialism to which I am used in the European Parliament and which I can assure your Lordships will be very good for this noble House. In the speech of the noble Lord, Lord John-Mackie, I recognised one of the authentic and constructive voices of British or Scottish agriculture when looking at European agricultural problems. I am sure that that also will be very good for your Lordships—and enjoyable, too.

I am not at all sure whether I should thank my noble friend Lady Faithfull for the fiendish question which she threw at me about Article 189 of the Treaty and the difference, as I understood it, between directives and regulations. All I can say is that I will draw her question to the attention of the legal services of the Commission. Based on what they say about direct applicability in member states, I hope we can have a discussion about her anxieties and ensure that future Community legislation is more comprehensible to the citizens of this country and more easy to apply.

Before making my concluding remarks, I should like to signal my own appreciation of the testimonial to his European past conducted by the noble Lord, Lord Boothby. I hope he will speak again. I am sure he was wrong to be so gloomy in twitting my noble friend the Foreign Secretary about his quoting Spaak and Monet. It is a fact that the bad history which he recounted is now being disproved by the attitude and actions of Her Majesty's Government in the European Community of today. May I also say how much I felt that the true voice of the best of the past of the British Labour Party was articulated in the remarkable speech of the noble Lord, Lord Stewart of Fulham.

The noble Lord, Lord Bruce of Donington, issued a specific challenge to me earlier in the day which his noble and learned friend Lord Elwyn-Jones refused to allow me, quite properly within the rules of procedure, to deal with at the time. I took a careful note of what the noble Lord, Lord Bruce of Donington, had to say at that moment and I will deal with it now. The noble Lord took the view that there was no prospect either of a fundamental reform of the common agricultural policy or of a reform of the budgetary procedure. He posed these questions separately, but I would suggest and hope that the noble Lord will agree with me that they are indissolubly linked, because if there is no cash in the till there is no money to waste on silly policies. This is a point which the European Community is now reaching: that there is a reasonable expectation within the next 18 months to two years at the outside that the amount of money available in the European Community's till will be not enough for the policies currently being serviced.

To me—and I hope also to the noble Lord—that is good news because it means that reform will not only be urgent but essential, because money cannot continue to be spent on unjustifiable or unworkable policies. So I offer the noble Lord the confident hope that the money is running out; it will continue to run out and the quicker it runs out, the better for the European Community and the new CAP and the new budgetary procedures.

In some ways the speech of the noble Lord, Lord Bruce of Donington, was more encouraging than that of the noble Lord, Lord Beswick. I have known the noble Lord, Lord Beswick, since I first came into the House late in the 'sixties. I am aware of Lord Bruce's formidable powers of exposition and his expertise in European budgetary matters but the speech of the noble Lord, Lord Bruce, was like that creature in Dr. Doolittle—a "push-me-pull-you"; some of it went that way and some it went the other way. Wherever he went in one direction he immediately cancelled out by what he said going in the opposite direction and while I sympathise with the noble Lord in having to reconcile his European enthusiasms with the current policy of the Labour Party as laid down by their conference, I am afraid the ultimate conclusion of his arguments was like one of those giant algebraic equations which we did at school—everything cancelled out and equalled nought.

I shall not keep your Lordships long because I know you are hankering for the Scottish countryside but the speech of the noble Lord, Lord Beswick, was more mellifluous, more pleasant to listen to, apparently better argued but much more sinister—and I use the word "sinister" deliberately and knowing the genuine political commitment of the noble Lord to many good and valuable causes. The noble Lord tricked out a totally destructive argument with a series of apparently realistic and reasonable questions. For example, the noble Lord is under the impression that, because other member states of the Community are spending a lot of money re-equipping their car industries or re-equipping their factories in a period when we are exploiting our oil resources and floating our oil rigs, we are not entitled to claim any credit for our exports of oil. Is the noble Lord really suggesting that somehow a German expert making an account of the budgetary payments and so on, should discount exports of coal? If not, why can we not do it with oil? Perhaps I am misinterpreting the noble Lord.

The noble Lord challenged me directly—and he mentioned me by name—to ask whether I could justify the current budgetary arrangements. No, I cannot, and that is why I support Her Majesty's Government because they do something about it. While we have been in the Community we have achieved a major alteration of our net contribution and, because of what I was saying to the noble Lord, Lord Bruce of Donington, the necessity of the reform becomes increasingly urgent and therefore changes will have to be made—an increased regional policy, and increased social policy and a rectification of what the noble Lord rightly said was wrong—Portugal being a net payer when they joined.

Finally, the noble Lord thought it was dangerous —"dangerous" was the word he used—to have people thinking how to make the Community work better in Brussels. All those foreigners tinkering away with rods and levers in Brussels, to do Professor Brainstorm plans, to change our nature and our society. I would suggest to the noble Lord that he should re-examine himself and begin to wonder whether he is suffering from some form of persecution mania because we have the European Parliament and the European Scrutiny Committee to weed out any daft or silly notions that come from Brussels before they are inflicted on the European taxpayer.

I enjoyed listening to the noble Lord, Lord Beswick. I would ask your Lordships to re-examine his speech, to see it for what it is. I was told once that Dr. Johnson defined a net as a series of reticulated holes. That is what the speech of the noble Lord was; nothing but negation, nothing but division, nothing but taking away, with nothing constructive or positive to put in its place.

Lord Beswick

My Lords, would the noble Lord allow me to intervene for a moment. Is the noble Lord trying to tell me that I was putting the other side of the case?

Lord O'Hagan

My Lords, I am delighted to hear the noble Lord is still sufficiently mentally alert to come back with that devastating piece of repartee, and I congratulate him on it. What the noble Lord said was only minus. He had nothing to put in place of the European Community. He had no alternative future for Britain or for our citizens, who depend on the trade we get from our membership of the Community. I thank noble Lords for joining in today's debate. I am sorry to have spoken so long. I am going back to Brussels tomorrow morning and my wits are getting very stirred. I thank noble Lords for listening to me. I beg leave to withdraw the Motion.

Motion for Papers, by leave, withdrawn.