HL Deb 27 October 1986 vol 481 cc506-7

2.53 p.m.

Lord Ezra

My Lords, I beg leave to ask the Question standing in my name on the Order Paper.

The Question was as follows: To ask Her Majesty's Government whether they have reconsidered their policy regarding British membership of the European Monetary System in view of the current problems with sterling.

Lord Brabazon of Tara

My Lords, we continue to keep this question under review.

Lord Ezra

My Lords, I thank the noble Lord for that short reply. May I ask him whether he will confirm that when Mr. Poehl, the President of the German Bundesbank, visited the UK on 20th October he had a meeting with the Prime Minister, and, as was widely reported in the press, the Prime Minister then reiterated her firm opposition to full British membership of the EMS ahead of the next general election? Does that mean that there is now a political issue involved, whereas previously, by using the term "when the time is ripe", the Government had given the impression that when monetary and economic conditions were satisfactory full membership would take place? Does that mean that even if those other conditions were right, nevertheless the Government would not do anything about this before the next election?

Lord Brabazon of Tara

My Lords, I am not in a position to confirm or deny what was said between Mr. Poehl and the Prime Minister on 20th October. Our membership of the exchange rate mechanism is, as I said in my original Answer, kept under continual review. We have always said that there are arguments both in favour and against joining the EMS and that we should not join unless we were satisfied that the balance was clearly in favour of our doing so.

Baroness Seear

My Lords, will the noble Lord tell us what are the conditions which will decide for the Government when the moment of ripeness has arrived? We are always being told, "when the time is ripe". What defines ripeness? If he cannot tell us that, will he tell us why not?

Lord Brabazon of Tara

My Lords, it is not possible to specify precisely. There are a number of factors and their interaction needs to be taken into account. It would be wrong to commit the Government in advance; circumstances change. Nor would it help conditions in the exchange rate market to be too specific. I refer the noble Baroness to the debate which took place in June, which was answered by my noble friend Lord Young of Graffham. There is very little that I can add to that.

Lord Tordoff

My Lords, I wonder whether I may revert to the supplementary question asked by my noble friend. If the Minister cannot disclose what went on between the Prime Minister and the German Bundesbank president, can he at least say whether it is the Government's view that no change can take place before the general election, or, whether, if the time and the conditions are right before the general election, the Government will take us into the EMS?

Lord Brabazon of Tara

My Lords, I have little to add to what I said. The matter is kept under continual review. If the time becomes ripe, that will be the time to join.

Lord Wigoder

My Lords, can the noble Lord say what conditions are in existence at the moment which make the present time wrong?

Lord Brabazon of Tara

My Lords, I have already answered that in answer to the noble Baroness, Lady Seear.