§ 2.49 p.m.
Lord Campbell of CroyMy 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 what progress they are making, in concert with the other EC member states, in achieving a single internal market by 1992.
1230§ Lord BeaverbrookMy Lords, we and our Community partners are making encouraging progress towards the completion of the single market by the target date of 1992. Over 100 individual measures aimed at removing barriers have been agreed in the past 18 months, 48 of them during the UK Presidency in the second half of 1986. Completing the single market will involve new opportunities and challenges for British firms. My noble friend has recently announced the launching of a national campaign to ensure that companies are aware of them.
Lord Campbell of CroyMy Lords, I thank my noble friend for that encouraging reply and wish all good fortune to the new enterprises announced today. Do the targets for 1992 include uniformity in the application of VAT to goods and services; for example, uniformity in zero-rating and exemptions?
§ Lord BeaverbrookNo, my Lords. There is no such commitment and the United Kingdom has said that it will discuss the role of appropriate tax measures in the completion of' the single market. However, in line with the Brussels European Council meeting last year, we do not see that as a priority area. In common with other member states, we have some fundamental difficulties with the present proposals, which cannot be adopted except by unanimity.
§ Lord GladwynMy Lords, is the noble Lord able to say whether the Government are aware of the opinion of the British Commissioner in Brussels, Lord Cockfield, as regards whether or not satisfactory progress is now being made towards the attainment of a single internal market? Is he entirely satisfied with the attitude of Her Majesty's Government in that respect?
§ Lord BeaverbrookMy Lords, we make no apologies for seeking the best results for this country. What is significant is the amount of common ground which we share, although there are differences of perception. Completing the single market will mean that there are a large number of individual measures which member states will have to negotiate and decide. We cannot accept that there is a single Commission package which we shall have to take or leave.
§ Lord Williams of ElvelMy Lords, will the noble Lord tell the House precisely what extra taxes the Government are prepared to impose in order to achieve the Community aim of a single internal market?
§ Lord BeaverbrookMy Lords, the Government are not intending to impose any extra taxes; there is no commitment whatsoever.
§ Lord RentonMy Lords, is it not true that the reduction of taxes on tobacco and alcohol and the imposition of VAT on food, children's clothing and school books would be a high price to pay in order to achieve further European integration?
§ Lord BeaverbrookIndeed, my Lords. My right honourable friend the Prime Minister has made it clear that the United Kingdom cannot accept proposals restricting our right to apply VAT zero rates. We have made it clear that VAT will not be extended to food, gas, electricity or young children's clothing and footwear.
§ Lord Williams of ElvelMy Lords, I am sorry to press the Minister. Do I understand that the Government are saying that they are not prepared to impose any extra taxes in order to achieve the internal market?
§ Lord BeaverbrookNo, my Lords. We have said that there can be no commitment to impose any extra taxes.
§ Lord Boyd-CarpenterMy Lords, does my noble friend say that his answer to the noble Lord, Lord Williams of Elvel, means that the Government do not regard it as a necessary condition of concluding the agreement that there should be equalisation of indirect taxation?
§ Lord BeaverbrookMy Lords, I have said that we will make no commitment in order to do that.
§ Viscount Montgomery of AlameinMy Lords, will my noble friend say what Her Majesty's Government are doing in order to accelerate the progress of metrication in order that we shall be compatible, competitive and not out of step when the single market becomes effective?
§ Lord BeaverbrookMy Lords, my noble friend has a good point. There is an existing derogation and we expect to be discussing the position with the Commission in the coming months.
§ Lord Allen of AbbeydaleMy Lords, in view of the importance of securing the free movement of professionally qualified workers as part of the completion of the market, is the Minister able to give any up to date information about progress on the general directive as regards mutual recognition of higher education diplomas, which I believe it is hoped will be finalised this year?
§ Lord BeaverbrookMy Lords, the noble Lord will recall that I answered a question on that point towards the end of last year. At that time, I said that the Commission's proposal for a general directive was identified by Community Heads of Government in June 1987 as a priority for decision by the end of 1988. Work has been pursued energetically during the Danish Presidency with a view to ensuring that that counsel is met. Mutual recognition of higher educational diplomas is part of the completion of the internal market. It is the aim of the Government to achieve a satisfactory outcome in that area.
Lord Bruce of DoningtonMy Lords, reverting to the supplementary question asked by the noble Lord, Lord Gladwyn, will the Minister say, while desiring to maintain an absolutely correct relationship between the Government and the Commission, that 1232 it is no part of the functions of Her Majesty's Government to please the noble Lord, Lord Cockfield?
§ Lord BeaverbrookMy Lords, I have already said that the interests of this country come first. We make no apologies for seeking the best results.
§ Lord EzraMy Lords, perhaps the Minister can indicate what progress has been made in opening up the market for public procurement, bearing in mind that that could present many opportunities for our capital goods manufacturers? At the same time, it would open our markets to competition.
§ Lord BeaverbrookMy Lords, the noble Lord is quite right. The opportunities available in the internal market will be highly significant for companies and business concerns in this country. My noble friend has announced an awareness campaign in order to stimulate British awareness and interest in participating fully in that large new market.
As regards public procurement, I do not have a specific answer on that point. However, I shall look into the matter and write to the noble Lord. There are so many aspects to the internal market that it is not possible to carry around the full weight of answers that may be required. However, I shall write to the noble Lord on that point.
§ Lord StrabolgiMy Lords, are books to be zero-rated? If I heard the Minister aright. they were not included in the list which he read to the House.
§ Lord BeaverbrookMy Lords, the noble Lord is quite right in saying that books were not contained in the list which I read out. There are no proposals at the moment to include books in VAT. However, I cannot give any long-term commitment that that may not one day be the case.
Lord Campbell of CroyMy Lords, is my noble friend able to dispel the fears of some environmental bodies that the completed internal market would allow hazardous waste materials to be imported from other EC countries without the need for licensing or other authorisation?
§ Lord BeaverbrookMy Lords, the controls on imports of hazardous waste under the existing EC directive will not be affected. The directive establishes a system of prenotification by the exporter and acknowledgment by the receiving waste disposal authority in the United Kingdom. I can assure my noble friend that we are not establishing an internal free market in hazardous wastes.
§ Lord CarterMy Lords, in view of the miserable failure of the EC to create a common market in agricultural goods, which was an objective of the Rome Treaty, are the Government convinced that the creation of an internal market in other goods will not create many more problems than it solves?
§ Lord BeaverbrookMy Lords, of course problems will be created but opportunities will also be opened up. The Government believe that completion of the 1233 single market, on balance, will bring major benefits to the European economy as a whole and similarly to British business.