HL Deb 21 March 1990 vol 517 cc314-83

2.51 p.m.

Lord Home of the Hirsel rose to call attention to the political and economic developments in Eastern Europe and the Soviet Union; and to move for Papers.

The noble Lord said: My Lords, all of your Lordships will be very conscious that for the first time for many years in a foreign affairs debate we shall not have the benefit of the advice of Lord Stewart of Fulham. This will be the first of a series of debates on international affairs, and as we try to disentangle the problems of Eastern Europe and the Continent of Europe we shall miss the penetrating clarity of his mind.

I am very grateful that the noble Lord the Leader of the Opposition is to follow me in the debate. I have to confess to him and to your Lordships that I am tempted to revert to my original status in this House and ask the indulgence of your Lordships for this speech. I am very conscious that it is quite likely that a speech made today on Eastern Europe and the Soviet Union will have to be contradicted tomorrow, so rapid is the pace of events.

The other day I asked one of my most experienced diplomatic friends how he had reacted to Mr. Gorbachev's Russia. He said, "I can only see through a glass darkly". I believe that that was true of most of us at that time. Much is still obscured.

This morning one of your Lordships kindly sent me an extract from a writing of Francis Bacon which I believe noble Lords would like me to read. It is as follows: Upon the breaking and shivering of a great State you may be sure to have wars: for great Empires, while they stand, do enervate and destroy the forces of the natives they subdued, resting on their own protecting forces. And then, when they fail also, all goes to ruin and they become a prey".

My conclusion today will be less sombre; but that is a timely warning, particularly when it comes to the designing of a pan-European security system to replace the existing alliances. When that time comes, I shall plead for time— for an interregnum, for two or three years to be taken up by negotiation— so that we can be sure that we plan for a lasting peace and give ourselves enough time to get the right solution.

Today we know more than we did a few weeks ago about the motives for Mr. Gorbachev's reforms. They were primarily economic. After 70 years of fair and public trial, the people of the Soviet Union, on the evidence before their eyes, could not help concluding that Marxism had totally failed to deliver the goods. Marxism had promised a great deal: full employment, equal opportunity and social justice. None of those promises has been fulfilled. It was a body blow to the people of the Soviet Union. Marx and Lenin were the founders of communism and the two greatest heroes of the Soviet Union. Their doctrine has been discredited. A whole country and empire was left without an ideology and without a faith, a very dangerous and critical situation. Mr. Gorbachev inherited that situation.

Mr. Gorbachev described that situation as "desperate" and requiring fundamental change. Indeed, he brought in those fundamental changes even though economically that involved borrowing the capitalists' clothes and politically, following the fiasco of the invasion of Afghanistan, it meant abandoning the central communist doctrine that force could legitimately be used to secure a political aim.

At the start some doubted whether Mr. Gorbachev's counter revolution was genuine. Now it is clear that the reforms have gone so deep that neither the Soviet Union nor the communist ambition for empire can ever be quite the same again. The hardest evidence of that is to be found in Eastern Europe. It is there, I believe, that the Western democratic capitalist countries have an opportunity to contribute to the economic and political stability of that area.

At least four of the countries of Eastern Europe— East Germany, Poland, Hungary and Czechoslovakia— have taken the decision that they will be independent, economically and politically, and will never again accept dictation from Moscow. To that extent the map of Europe has already been changed to a point which no one could have foreseen even two years ago. Those countries may be described as determined to construct constitutions and institutions in the democratic mode. The only doubt at the present time is whether they will be too poor to sustain the democratic system and in their turn deliver the goods to their own people.

There are certain encouraging signs. The reuniting of the two Germanys will surely create a viable economic unit. Poland, where religion has undoubtedly been a cementing factor, will certainly receive, both from the United States and from the countries of the European Economic Community, enough help to set it firmly on the road to recovery. Czechoslovakia and Hungary present a more difficult problem. However, I believe that they too can look with some certainty to investment from the democratic and capitalist world. They will need some assistance, because it is here that the Western democracies can clearly take the decision now to help them to underpin their new political independence.

I do not think that at present that need mean membership of the European Economic Community. It might well be a mistake to try to run before we can walk: nevertheless, if the Eastern European countries can design a free market among themselves, if that can be strengthened by an institutional link with the existing Common Market in Western Europe and the plans for recovery for Eastern Europe can be co-ordinated and underwritten by the World Bank, those countries can, in Mr. Gorbachev's rather dramatic words, recover their European home. I hope that that is something for which all European countries can work.

I should like to turn to another area which I think is ripe for exploitation in the interests both of the Soviet Union and of the Western democracies. If the diagnosis is right— that Russia's troubles basically stem from the weakness in its economy— surely the Russian leaders must pay serious attention to the colossal savings in cash which could be achieved by a considered programme of demilitarisation. The formula to gain those prizes without impairing Russia's security is ready to hand; it is of course mutual and balanced disarmament.

I remember, when I presided over a disarmament conference in Geneva, Mr. Gromyko refusing to sit down at the table so long as that formula headed the agenda. But now things should be different. There is a mutual interest. Russia must want to strengthen its economy and the European members of the Community must want to see lifted the menacing cloud which has brought fear to the whole of Europe for the last 40 years. I believe that that can be done. The purpose of such an exercise is to fix the level of forces and weaponry low enough to ensure that aggression is no longer seen to be an option for either side. If we could reduce armaments to that level, that would be a good start and would also be the objective of the disarmament conference which will take place this summer.

As I said at the start, if such a preliminary negotiation can succeed this year and a mutual balance can be struck, that would be the best foundation of all from which to begin the lengthy negotiations for a pan-European security system designed to replace the existing alliances. I confess that I am more optimistic than I have been for many years that such arrangements can be reached successfully in the foreseeable future.

What kind of Russia shall we have to deal with? That is of course for the Russians to decide. However, because the danger of fragmentation of the Soviet Union is one to which we may have to face up, I have been hoping that Mr. Gorbachev would move towards a confederal system or a Commonwealth structure or whatever one likes to call it. That will be vital because, when we come to the negotiation of those matters which are so serious for the future of Europe and of the world, it will be important that we find a country expressing its wishes with one voice. I am a lifelong opponent of the old dictatorial Russia, but I am not attracted to the idea of a Russia which is fragmented into small republics which cannot speak with one voice. It is essential that the Russia with which we have to negotiate should be able to do that.

Reverting for a moment to the disarmament scene, I do not see how Mr. Gorbachev could object to negotiations under the heading of "mutual and balanced disarmament" because the purpose in view would as I have described, be to eliminate the option of aggression from either side. So the pan-European security system is one of the main objectives which we should try to reach.

I do not think that I have any more suggestions to make today. I repeat my belief that it is now realistic to assume that the four countries of Eastern Europe which I mentioned can be independent in their own right, both economically and politically, with a little help from the West. I hope that, when we come to negotiations, the British Parliament will play a constructive part. I look forward to the debate because many noble Lords will have constructive ideas. In the meantime, I beg to move for Papers.

3.7 p.m.

Lord Cledwyn of Penrhos

My Lords, we are all grateful to the noble Lord, Lord Home of the Hirsel, for tabling this most important Motion and for his balanced and thought-provoking speech. The noble Lord has concentrated on the central implications of the momentous events in Eastern Europe and I shall seek to follow him.

My colleagues and I also appreciate the noble Lord's warm tribute to our late friend, Michael Stewart. We shall miss him very much in our debates, especially in our discussions on foreign affairs. His wisdom and experience gave his speeches a special quality and I know that they were valued by noble Lords in all parts of the House.

Noble Lords

Hear, hear!

Lord Cledwyn of Penrhos

My Lords, as the noble Lord, Lord Home, has said, the speed of recent events, the historical background of the various countries concerned, the quality of their present leadership and the state of their economies make firm predictions impossible. Who can say what things will be like in Romania or Bulgaria or indeed, as the noble Lord said, in the Soviet Union in 12 months' time? It is one of those moments in history when great opportunities are matched by grave dangers.

The theme of the noble Lord's speech is that Britain and the West must observe and react to those events wisely and generously so that free and stable societies might be created in Eastern Europe. That is the aim of the people of those countries and of every country in the West, but it is a daunting task. We all think in terms of an undivided Europe of free countries, but, if we do not get it right, rejoicing could quickly turn into tears.

The eyes of the world were on East Germany last Sunday— I shall return to that matter later— but we wish the new government every success in their historic task. We also look forward to free elections over the next five months in Hungary, Romania, Bulgaria and Czechoslovakia. Elections in Poland have already been held, as we know. We thank heaven that there will be democratically elected governments in Eastern Europe. Had someone suggested it in a debate in this House 12 months ago, we would have turned away our heads in disbelief. But the reality is that in due course people will want to see results. Many will judge the success of the democratic process by the amount of food in the shops. They will want efficient public services, good hospitals, decent jobs and all the things that the West tends to take for granted.

The task of economic reconstruction is crucial and immense. But peace in Europe depends upon its success. We in this country, together with other countries, must spare no effort in working for it. By "working for it" I mean co-operating in constructive Community policies which will help to strengthen their economies. I shall return to that point. It must also be emphasised that the final solutions and therefore their success or failure must come from within the countries themselves. The new governments there will have to formulate and operate their own policies. That is already happening in Poland where a government composed mainly of non-Communists are carrying out measures which are not popular because of their austerity but which are essential nonetheless. The medicine is unpleasant, but the Polish people are taking it at the present time and we must admire them for doing so.

The other challenge facing Poland, Hungary and the other countries is to build or re-build the foundations of democractic societies; namely, an independent judiciary, an impartial Civil Service and the establishment of the rule of law with all that it implies. From what I have heard and read over the past few months I understand that the broad objectives of the leaderships of the six countries concerned are: a democratically elected government with practical policies which they are resolved to pursue; the creation of basic democratic structures; and finally, the resolve to become members of an undivided Europe in which military confrontation and the arms race are things of the past, as the noble Lord, Lord Home, mentioned.

Those are ideals that we can all share, but what can we do to help? The noble Lord, Lord Home, made some important suggestions. I hope that the noble Lords, Lord Brabazon and Lord Belstead, will respond constructively to his points. I trust that Ministers will say that the West must provide leadership, inspiration and generous assistance. Both the noble Lord and my noble friend Lord Callaghan suggested that action on the lines of the Marshall Plan should be considered. There is little doubt that financial aid, if it is to be effective, must relate to the vast size of the problem. It must include grants or loans for the purpose of building up foreign exchange reserves. It is said that while IMF loans help, they are too small. But it is good to know that Poland has already received 1 billion dollars for that purpose. Again, support will be needed to cancel most of the debt already owed to western governments and banks. They would be crippling and could also frustrate the reforms.

Finally, there is the urgent need for long-term finance for development— the Marshall Plan type aid mentioned by noble Lords. Decisions on these matters must be taken not by bankers, financiers or businessmen— they come in later— but by politicians with guts and vision. That is what is needed at the present time. We shall be glad to have the Minister's comments on these proposals and on the scope and nature of the assistance that the Government believe is necessary to buttress the foundations of these new democracies.

Furthermore, will the noble Lord confirm the assumption that the aid programme will be planned, organised by and channelled through the European Community? As I see it there is no practical alternative. The imminence of the single market underlines that point. May we also assume that any Community initiative will be taken in concert with the United States and other countries such as Canada, Australia and Japan? Can he say whether talks about that are now taking place in the European Community and with the United States? It is a matter of the utmost importance.

I noted that the other day the Governor of the Bank of England urged that: assistance needs to be coordinated … assistance offered by individual institutions fits into the overall pattern of the requirements of recipient countries". Taking all that into account, it would be a mistake to think that the mismanagement of decades can be put right in a few months. The process of rebuilding the economies of many of these countries will take many years of hard work and the implementation of realistic policies. Every country which is undergoing change has its own special problems and the implications are best known to the people themselves. For example, the economic and social problems of Romania are far greater than those of Czechoslovakia— the reasons for which noble Lords are aware. East Germany poses complex problems. I recall the debate opened by my noble friend Lord Callaghan on 17th January on the topic of German reunification. There have been changes in the short space of time since then. The most important is the broad acceptance throughout Europe— and also in the Soviet Union— that the reunification of Germany is now inevitable if the German people, West and East, desire it, which they obviously do.

We also warmly welcome last Sunday's free elections in East Germany. I repeat that we wish the new government success. They are fortunate to have at hand the goodwill and enormous resources of West Germany. But people are asking some very basic questions and I think that they should be ventilated in this debate. For example, what kind of Germany will emerge? Will East Germany be joined with the West as one seamless country or will there be a federal arrangement? Will West Germany remain in the European Community and will East Germany join it there? And there is the most difficult question of all: will West Germany remain in NATO and what happens to East Germany then, especially in view of the Soviet reaction to that possibility?

The new government must now decide how they propose to approach the problems inherent in unification. As we know, the different parties there have different views. For example, the Christian Democratic Alliance, which is now forming a government, advocates a speedy merger with West Germany. The way ahead for Germany is fraught with complexities for them and indirectly for the rest of us. I note that the right honourable gentleman the Foreign and Commonwealth Secretary has held detailed talks with Chancellor Kohl and with Mr. Hans Dietrich Genscher. He is reported as being encouraged by those discussions. He also said that the future of NATO must be clarified before unification takes place, although he also gave the impression that he wanted to see the swift entry of East Germany into the European Community. Lastly, Mr. Hurd said that he would prefer to see unification dealt with under Section 23 of the Basic Law and not by a constitutional conference. I hope that I have accurately summed up the current views of the Foreign Secretary as they constitute Her Majesty's Government's current policies in that crucial area.

Perhaps the noble Lord, Lord Brabazon, will deal with those points because they lie at the heart of this debate. I personally do not quarrel with them, although I think that there is an argument for a constitutional conference as a safer way of achieving a stable arrangement. We have a right to be deeply concerned about the ultimate outcome of these profoundly significant changes. Even if unification is now inevitable, we have a duty to co-operate with all concerned to ensure that a stable and democratic new Germany is created.

That also seems to be the broad objective of the Soviet Union, whose interest and involvement, bearing the last war in mind, are at least as great as those of the West. Its agreement with any final settlement is crucial if we are to have confidence in its permanence. A neutral, unified Germany fails to appeal to me, but a West Germany within the European Community and NATO does appeal to me. But that is a personal view.

The noble Lord, Lord Home, referred to the changes now taking place in the Soviet Union and to their implications generally. In all the convulsive and historic events which have shaken the world in the past 18 months, Mr. Gorbachev has played a central and crucial role. He has been the catalyst of change. There is no doubt about that, whatever the motives— and I tend to agree with the noble Lord that the basic motives may well have been economic. When we think of his predecessors and the Cold War, and the miserable decades the East European countries have suffered, we must pay him proper tribute. Mr. Gorbachev has huge problems to tackle and to resolve in the Soviet Union. He has now assumed extensive powers— some say excessive powers— to enable him to deal with the economy and the resurgent nationalism of some republics in the USSR. He has a dangerous and uncertain job; I think we should wish him well. If and when he succeeds there are those powers to be shed. I understand that in a few years the president will be elected directly.

President Gorbachev's remarkable record up until now gives us hope and confidence that he will use his new powers wisely and cautiously. His announced decision not to use force in Lithuania is both encouraging and clear evidence of that.

Finally, the noble Lord, Lord Home, discussed the implications that these great changes will have on defence and disarmament. My noble friend Lord Graham hopes to deal with that in greater detail later in the debate. However, events now make it possible for disarmament on a very large scale to take place. Soviet troop withdrawals are proceeding in some countries and requests for withdrawal are being made by others. The Warsaw Pact itself, based as it is on bilateral treaties, must be in disarray and the consequences of this and of the effect of large scale withdrawals is another of Mr. Gorbachev's problems. It seems clear that the CSCE Conference of 35 nations with the United States and Canada assumes a greater importance. I hope that Her Majesty's Government will have clear and constructive policies to meet the new situation.

We must continue to sustain NATO but, as I have said in previous debates, we must reassess its objectives and its strategy. We should indeed have started doing so before now. I urge the Government to take the intiative in calling for a NATO summit with the clear objective of reshaping the organisation and also of discussing how our expenditure can be reduced through the CFE process of negotiation.

We can now look forward with greater confidence to the forthcoming treaty on conventional force reductions in Europe including the ceiling of 195,000 troops for both the United States and the Soviet Union. in Central Europe. Perhaps the noble Lord will be good enough to comment on this and on the status of Soviet forces in East Germany.

Our longer term objective must be a new security system in Europe as a whole. We should not be thinking of this as "pie in the sky". We should be giving serious thought to it and planning for it. As the noble Lord said, aggression is not an option for either side any more. A Marshall Plan, or its equivalent, organised by the European Community, will become a more realistic prospect if substantial disarmament takes place.

The young men who marched to the First World War sang a song the words of which I well remember. They are: There's a long, long trail a'winding Into the land of my dreams". But the long, long trail led to the Somme and to Passchendaele and the death of millions, and, eventually, to the Second World War, which most of us remember. The European Community came into existence after the war not merely to set up the common agricultural policy, not to produce more wheat and more wine, but to make sure that the flower of Europe's youth should never again be slaughtered in terrible wars. That was the main reason behind the Treaty of Rome and the European Community, and we should never forget it. The great opportunity to lay new foundations has, I believe, arrived and if we do not grasp it we may not deserve to survive.

In A Tale of Two Cities, Charles Dickens wrote of, the best of times and the worst of times … the age of wisdom and the age of foolishness … the age of light and the age of darkness … the spring of hope and the winter of despair". Let Britain and the countries of Europe work together to make this "spring of hope" and a new opportunity for the people of Europe and the world.

3.25 p.m.

Lord Thomson of Monifieth

My Lords, I join with the noble Lord, Lord Cledwyn, in his expression of thanks to the noble Lord, Lord Home, for initiating this important debate. I join with both of them in the tributes to Lord Stewart of Fulham— Michael Stewart. I was proud to have served as his deputy for a number of years. He made a very distinctive and fine contribution to international affairs in both Houses of Parliament.

The noble Lord, Lord Cledwyn, quoted Charles Dickens, and it is an appropriate quotation. I cannot recall a period in all the years during which I have had an interest in international affairs which has been more a time of hope and equally more a time of uncertainty.

The historic and headlong changes now taking place in the Soviet Union and East and Central Europe dangle before us, as the noble Lord, Lord Cledwyn, said in his eloquent closing passages, the glittering prize of a disarmed Europe at peace with itself for the first time in this century and with the personal liberties and material prosperity of the West being spread to the remainder of the Continent.

After our intitial euphoria, however, we are coming to realise that it is an awesome task, as the noble Lord, Lord Cledwyn, said, to create liberal pluralistic societies from the ashes of one party states. Moreover, I believe that we are becoming increasingly aware that a failure to do so will not mean a return to what some rather nostalgically feel are the comfortable certainties of the Cold War. It would instead mean a return to what the Financial Times the other day described as, A cockpit of squabbling nationalities dominated by the awful prospect of a pauperised super power with a huge nuclear arsenal". Mr. Shevardnadze said the other day, after the Ottowa Summit: If perestroika collapses there is a risk we could have a dictatorship". Therefore what is the wisest way for Western statesmanship to seek to maximise hope and minimise uncertainty?

First and foremost, as the noble Lords, Lord Home and Lord Cledwyn, have indicated, it is to do what we reasonably can to ensure that Mr. Gorbachev and those who share his views in the Soviet Union are able to be successful. It is the truth that it was the Stalinist regime, the Brezhnev doctrine, that held the Soviet empire in Eastern Central Europe together.

The other side of that is equally true. If Mr. Gorbachev were to fail, then the effect on the other countries of Eastern Central Europe would be very serious indeed. I notice that President Havel of Czechoslovakia said the other day that by far the best way that people in the West could help Czechoslovakia is to ensure that Mr. Gorbachev and his reforms were successful in the Soviet Union.

The strategic framework for the West, as the noble Lord, Lord Cledwyn, said, must for the present time remain NATO even though its counterpart, the Warsaw Pact, is more a matter of fiction than of fact. A constructive formula, or one that the Soviet Union is at least ready to acquiesce in, has to be found for a Germany which includes the former DDR and yet remains in the Western Alliance.

Perhaps I may adopt a favourite phrase of the Government in other contexts. So far as concerns NATO, the status quo is not an option. I echo the words of the noble Lord, Lord Cledwyn, that what is needed is a lot of hard and fresh thinking about the changes required in the operations of NATO to meet this radically different situation. I very much hope that the Government will play a positive part in that. I shall leave it to other noble Lords and to my noble friend Lord Bonham-Carter to develop those issues on the collective security front.

I want to concentrate for a few minutes on the economic issues of our relationship with the former Communist world. The global financial framework can only be, as the noble Lord, Lord Home, said, the IMF and the World Bank. However, within that, as the noble Lord, Lord Cledwyn, indicated, there are compelling reasons for the initiative lying primarily with the European Community. I notice that that has been recognised in the arrangements for the East European Development Bank. That is being set up by the countries of the group of 24 including the United States and Japan but those two countries have accepted that the EC should have 51 per cent. ownership of the bank, and that the bank should be located within the Community. I hope that the Chancellor and the Foreign Secretary are successful in their bid to have the headquarters of that bank in this country, although I am bound to say that the Prime Minister's approach to economic and monetary matters within the Community can hardly help them in their efforts.

It remains vital to maintain a positive American strategic and economic commitment to stability in Europe. In my judgment, the best way to do that is for the nations of the Continent to show that they are ready to help themselves. Within that, the best way to do that is to have in the heart of Europe a strong and integrated European Community. The results of the first free elections in East Germany for over 50 years reinforce that view, and indeed Chancellor Kohl has emphasised the need for deepening the Community's unity at the same time as Germany is reuniting.

I believe that to talk about the countries of Eastern and Central Europe becoming full members of the Community in the immediate future is, as the noble Lord, Lord Home, said, premature. The DDR is bound to be incorporated in the Community; and given its ramshackle state economy, that will certainly present us with plenty of problems. However, that is a special case because it is part of the German nation, and as the noble Lord, Lord Cledwyn, said, it has the immense advantage that within the boundaries of the new Germany, two-thirds consists of West Germany with its immense managerial, entrepreneurial and sophisticated skills in running an extremely successful and civilised pluralist society.

If the Community does not make itself capable of giving the necessary lead in these matters, we must recognise that a reunited Germany will inevitably, against its own inclinations, find itself playing a major role increasingly on its own. The Federal Republic, with Europe's strongest economy— as anyone in Eastern Europe today can see— is by far the largest provider of trade and aid to Eastern Europe. The Federal Republic has by its own efforts built a robust economy and a thriving democracy. It has taken the lead in turning its back on the past and in seeking to secure its future within an integrated European Community. Therefore, those who are inclined to feel half-hearted simultaneously about German reunification and European integration are taking considerable risks about the future.

The completion of economic and monetary union within the Community is the necessary prerequisite to give the Community the cohesion and decision-making structure in order to give maximum help to the countries of Eastern and Central Europe, and to shape the Community's future relations with them. In all those countries there is now a dangerous gap between politics and economics. The political revolutions have taken place almost overnight and they enjoy immediate popularity. However, as we recognise, economic change takes a long time and is often unpopular and painful.

That sombre economic background to hopeful political reform represents an immense challenge to the West. I echo the words of the noble Lord, Lord Cledwyn, that what is needed from the West is an imaginative response in its concept and vision which is comparable to the Marshall Plan at the end of the Second World War. Of course, historical analogies are always viewed with caution. The needs in the Soviet Union and the countries around its borders are very different from those of Western Europe at the end of the Second World War. The Soviet Union and the countries around it need a flow of long-term investment backed by an institution like the European Investment Bank. They perhaps need trade more than aid. They need a much more liberal transfer of technology once the security considerations of the Cold War have begun to fade. Most of all, they need a transfer of human resources.

I remember once hearing a story— no doubt apocryphal— of Sidney and Beatrice Webb, the great Fabians, going to visit the Soviet Union while Lenin was still alive. They asked Lenin what he most needed to make a success of the Soviet revolution. I think that they expected him to give them some sort of ideological reply about the help that the Left-wing movements in the outside world could give him. To their surprise he said if it had been practicable, he most needed 100 first division British civil servants. Perhaps the developments in the Soviet Union might have been different if that had been practical politics.

What is practical politics today is what the Government are presently engaged in with other governments of the Western world and the European Community— that is, a massive injection of the wide diversity of skills which go to make up a modern civil society. I am thinking of the people who are experts in business management, local government, running democratic political parties and those who know about creating independent press and broadcasting systems in a modern democracy. That is why we welcome the Government's know-how funds and are glad that they are to be extended to other countries beyond Poland and Hungary.

In all those developments Britain has a leading and constructive role to play. It seems a great pity that the Prime Minister has such strong personal and idiosyncratic views on some of those issues which tend to isolate her from her allies and from the possibility of exercising Britain's full influence. Perhaps her present preoccupations on the domestic front will allow the Foreign Secretary and his collegues to get on with the job of playing Britain's part without having to divert so much energy into mending the Prime Minister's fences. In so much of that, there is a very broad degree of consensus in both Houses of Parliament and in the country as a whole.

An imaginative and adequate Community plan to help the former Communist countries of Europe would not only help to bridge the dangerous gap between political aspirations and economic reality but would be enlightened self-interest for Western Europe. It would ensure that a new united Germany was fairly harnessed, as its leaders wish, within the Community framework. It would also mean that after 1992 as the internal frontiers of the present Community disappear, they will not be replaced by any new fortressed Europe creating a new type of Berlin Wall between East and West.

In all those matters, I believe it to be of critical importance that Britain should play a proper leading role in those Community developments instead of going along, as so often happens, rather grudgingly and finally acquiescing in decisions which it has done too little to shape. The historic developments now taking place in the Soviet Union and Eastern Europe present a new situation and I hope that they will produce new attitudes from Her Majesty's Government.

3.39 p.m.

The Minister of State, Foreign and Commonwealth Office (Lord Brabazon of Tara)

My Lords, like the noble Lords, Lord Cledwyn and Lord Thomson, I am most grateful to my noble friend Lord Home for tabling a Motion today which allows us a further opportunity to debate developments in Eastern Europe and the Soviet Union. I am sure that noble Lords will agree that that is both timely and welcome. I should also like to add to those who have spoken in paying tribute to the late Lord Stewart of Fulham and to say how sorry I am that he is no longer in his place to take part in our debates on foreign affairs.

The scene in Central and Eastern Europe is perhaps less dramatic than it was a few months ago. Events are settling down. While there remains the potential for instability, we are entering a phase of consolidation; one of holding elections, establishing democratic institutions and the rule of law; and one of introducing market-based economic reforms. All these steps are essential if these countries are to enjoy lasting freedom and prosperity.

The people of the German Democratic Republic are of course in a special position. They have already been to the polls, and there can be no doubt that they have voted for a new beginning and a democratic future in a united Germany. They have our warm good wishes. The parties of the Alliance for Germany now have a mandate to form a democratic government that will begin negotiations with the Federal Republic of Germany on the mechanics of unification. Intensive consultations on the external aspects also lie ahead, and Britain is fully engaged in these through the two-plus-four framework agreed in Ottawa last month.

Meanwhile, however, the pace and drama of events in the Soviet Union have accelerated. The Soviet political scene is littered with the freshly slain carcasses of doctrinal sacred cows. It is sufficient only to look at the events of the past few weeks: Mr. Gorbachev's election to a new executive presidency by a parliamentary assembly more representative than anything seen since the immediate aftermath of the revolution; the decision to abolish the Communist Party's constitutional monopoly of political power; the legalisation of some forms of private property; substantial successes for non-party candidates in free local and republican elections; and, finally, a declaration of independence by the Parliament of a republic— Lithuania— in which the communists are a minority. These may be uncharted waters but the current is towards democracy, and that is profoundly welcome.

Against this background, Her Majesty's Government have two priorities. First, to offer support for the process of reform in Eastern Europe and the Soviet Union. Secondly, to co-operate with others to ensure that Europe's security and stability is maintained and strengthened in the transition to a new pattern of relationships between its nations.

It is very much in our interests to support political and economic reform as far as we can. East and West stand to benefit from the increased opportunities for contact and co-operation which successful reform will bring.

In the case of economic assistance, it is necessary to distinguish between what we can do for Eastern Europe, and what is possible in the case of the Soviet Union. There, key decisions about making the economy more decentralised and responsive to market forces have still to be taken. The scale of the problem is also much larger, and the impact of any Western help would be correspondingly smaller. Moreover the Soviet Union is already rich in resources: it is the present poor organisation of the economy whch denies its people a higher standard of living. For all these reasons, the scope for the West to use its finite resources to assist the Soviet Union, should any request be received, is more limited. It will be important to ensure that our help is geared to the introduction of market mechanisms and essential skills. Britain is already doing this in a number of ways— for instance, through help with management training.

It is of course for the countries concerned, with our advice and support where it is requested, to introduce and to sustain the policies necessary to transform their societies, as the noble Lord, Lord Cledwyn, said. Their leaders will need political will and courage to see the job through. So far, there appears to be no shortage of either quality, and that is most encouraging.

We are offering support for political reform in various ways. Political contacts are being revitalised at all levels. My right honourable friend the Foreign Secretary has so far this year met all his East European colleagues at least once. He and my honourable friend the Minister of State have between them visited almost all the countries of Central and Eastern Europe in the same period. The Polish Prime Minister was here recently, and this week President Havel is a most welcome visitor. These intensive contacts and consultations are helping to lay the foundations for more normal relations between our countries in future. It is important to demonstrate readiness to welcome the reforming countries fully into the democratic community of nations.

The Council of Europe offers an institutional link. We support the extension of its membership to the emerging new democracies on our continent. We are also ready to assist the process of developing democracy through practical advice and support. Noble Lords will be aware of the initiative announced by my right honourable friend in another place on 22nd February. This aims to give help on an all-party basis to political parties in Eastern Europe and perhaps elsewhere. Consultations are continuing with the opposition parties and others within the Palace of Westminster.

Economic co-operation and assistance can help to provide the East European countries with a bridge to future prosperity. The view is sometimes heard that Western countries are not doing enough in this field. I disagree. In only a very few months a remarkable range of initiatives has been launched. We are, however, only at the initial stages of what must be a sustained commitment over many years. That point has been echoed in all the speeches before mine. The purpose of this support cannot be to underwrite the devastated economies of the East. Our own resources are not limitless, and, as I have mentioned, the primary impulse for reconstruction must come from within. Instead, we should opt for carefully targeted assistance to ease the inevitable pain of transition to market systems, and to develop the private sector as the main motor for future growth.

It is important for Western businesses and companies to involve themselves in this process. They possess the experience and skills which are so desperately needed in Eastern Europe. They should take a long term view of the market opportunities and potential there. Investment may be slow to yield returns at first, but substantial rewards are likely to accrue as reform proceeds. I hope that British companies too will now begin to look seriously at the possibilities.

I can confirm to the noble Lord, Lord Cledwyn, that the European Community is playing a central role in supporting the process of economic reform. The Commission is co-ordinating the wider effort of the OECD countries. Community countries have successfully floated a proposal for a European Bank for Reconstruction and Development, and work on its establishment is now well advanced. Its initial capitalisation will be £ 6.5 billion and, at Britain's suggestion, its activities will focus in particular on support for the private sector. As the noble Lord, Lord Thomson, said, there is a good case for the bank's headquarters to be located in London, and we are pressing our case with Community partners and others.

The Community is also supplying food and other forms of urgently required short-term assistance to countries such as Poland and Romania. For the longer term, we want to make more of the Community's trade and co-operation agreements with Eastern Europe, and to develop new and closer forms of association between our countries. Britain has suggested that these might include new agreements whose scope and content can be increased as the economies of Eastern Europe diversify and grow.

My right honourable friend the Foreign Secretary has emphasised that the Community must remain open and welcoming to the East. Britain believes that this ought logically to lead to the eventual possibility of full membership of the Community for those countries wishing to join and able to meet the obligations of membership. This is not simply a matter of sustaining prosperity and growth in Eastern Europe. It is also a way of developing the Community's role as a force which can draw Europe's nations together through strong ties of mutual interest and close co-operation.

Beyond the Community, Britain is contributing to multilateral support programmes for Poland and Hungary through the IMF and the World Bank. We are ready to participate in similar programmes for other Eastern European countries once approved measures of reform are in place. On our own account, we have established "Know-How Funds", to which the noble Lord, Lord Thomson, referred, for Poland and Hungary. These are worth £ 75 million. We are using them to help develop the skills needed to run a successful democracy and market economy. Their great advantage is their flexibility, permitting a wide range of disbursements and applications. We plan to extend the coverage of these funds to other countries which have clearly committed themselves to wide-ranging reform.

In the case of the Soviet Union we are anxious to develop further our already excellent relations. We engage in close and regular consultations with the Soviet leadership on a wide range of issues. My right honourable friend the Prime Minister plans to visit the Soviet Union in June, and my right honourable friend the Foreign Secretary rather sooner. Our aim is to be able, with other Western countries, to regard the Soviet Union as a friend and partner, more closely integrated into the international community. We wish, for example, to develop further the useful co-operation which we now pursue together in the United Nations. We are also supporting the Soviet application for observer status in the GATT.

In general, we are working for a sound and co-operative relationship which will underpin our common efforts to advance the process of arms control and reinforce security in Europe. The continuation of President Gorbachev's reform policies will greatly improve the prospects for a lasting transformation in East/West relations. Like my noble friend Lord Home and the noble Lord, Lord Cledwyn, we greatly admire the task which President Gorbachev has set himself and we fully support his policies. He faces formidable challenges. Increased freedom has brought new tensions and pressures into view. We trust that President Gorbachev will use his newly acquired powers wisely to overcome these problems and further to expand freedom in the Soviet Union.

There have been indications that President Gorbachev is ready to allow the Soviet Unions's republics to choose their own destinies. Procedures which would allow eventual secession have been promised and the process of working these out has now begun. We are naturally concerned at the recent increase in tension surrounding the situation in Lithuania. However, we have seen no evidence to suggest that President Gorbachev is contemplating the use of force, which he has previously ruled out. We believe he is well aware of the damaging consequences of any resort to force for all that he is trying to achieve in the Soviet Union. It is encouraging that both sides seem to want further talks. We hope that negotiations with the Lithuanians will lead to an orderly and amicable settlement which will allow the Lithuanian people to exercise their right to self-determination.

At present the overall situation in the Soviet Union is still fluid and uncertain. Nor can the potential for instability in Eastern Europe be ignored. Besides support for reform, therefore, our second priority should be to apply the discipline of diplomacy to the challenge of accommodating change. We need to preserve a strong overall framework of European security and stability. It makes sense to adapt and develop existing structures and institutions. These are readily available to serve new tasks, such as managing the changes now taking place. They have also served us well in the past.

NATO remains central to our concept of European security. It is a free association of equal partners for the purpose of collective defence and the pursuit of arms control. It has proved a flexible and reliable anchor of stability in Europe for over 40 years. I do not believe that NATO will lose its relevance in the 1990s. As my right honourable friend the Foreign Secretary said, our security needs will change, but the need for security will not. NATO was never conceived as a temporary arrangement but as a lasting focus for confidence and mutual support in matters; of defence.

It is no longer sensible to speak of an immediate threat from the Warsaw Pact or the Soviet Union. But the Soviet Union is likely to remain a formidable military presence within its own borders if not, ultimately, in Eastern Europe. While we welcome the Soviet Union's evolution towards domocracy it is prudent to bear the military realities in mind and to remember that there is still a lot of evolving to be done. The link which NATO provides to the United States will therefore remain important for Western Europe. So, too, will NATO's role as an insurance policy against uncertainty and possible instability in future. We may also have to face new threats associated with weapons proliferation in neighbouring regions.

My right honourable friend the Foreign Secretary has listed some characteristics that it would be sensible for NATO to retain. These include its present membership, a sensible mix of nuclear and convention forces, the presence on the Continent of significant stationed forces including those of the US and Britain, and in integrated command structure. But we should aim to develop new approaches for NATO in other areas. For example, we need to consider how to take forward the process of conventional arms control after the successful conclusion of a Vienna agreement. NATO should not surrender the initiative it has gained with its imaginative proposals in Vienna. There should be fresh thinking about the strategies that we shall need at lower levels of forces, including the development of the concept of minimum deterrence, to which my noble friend referred. We ought to aim to improve further political consultation and European defence co-operation within NATO. We might also seek more dialogue with the Eastern countries.

Defence is an important element in security; but we seek a Europe in which all can enjoy equal security in a wider co-operative framework. We believe that the CSCE can be developed as a framework of this kind. My noble friend the Lord Privy Seal will set out our ideas in more detail in his winding-up speech.

A united Germany will lie at the geographical centre of the future European security system. It will also possess great economic strength and considerable political authority. We are now engaged in a common effort to resolve the external aspects of unification. We are confident that a united Germany will emerge as a welcome and influential force for strengthening the European system.

Between the two-plus-four arrangements, NATO, the Community and other consultative links, we now have a satisfactory framework for addressing the external aspects in a confident way. The first meeting of the Six took place in Bonn last week. It made useful progress with procedures and settled an important point of principle. That was the principle that Poland should be involved when border issues are discussed. In this context, Britain very much welcomes the decision of the FRG to work for a treaty which guarantees the existing border.

As the noble Lord, Lord Cledwyn, said, other important questions remain to be resolved. We welcome the very clear statements from Chancellor Kohl that a united Germany should remain within NATO. This is the best way to ensure that German unity contributes to confidence and stability in Europe as a whole. Poland, Czechoslovakia and Hungary have recently stated their support for continued German membership of NATO. We hope that the Soviet Union will join the strong European consensus on this point. It is right to acknowledge her legitimate security concerns, and the proposal for transitional arrangements governing the status of Soviet forces in the GDR is intended to provide reassurance that these are not being neglected— a point raised by the noble Lord, Lord Cledwyn.

NATO has never been a threatening alliance, nor will it threaten the Soviet Union with a united Germany as a member.

We have also to resolve the question of the progressive integration of the GDR into the European Community. There will have to be transitional arrangements in a wide range of areas. It is clear that an economy which has for over 40 years developed along very different lines from those of the existing members cannot be accommodated overnight— a point made by the noble Lord, Lord Thomson— but for the sake of the well-being of the East German people, and for the preservation of the momentum of the Community's development, we hope that the transitional period can be kept as short as possible. My right honourable friend the Prime Minister will be discussing these matters with other Community leaders at a special summit in Dublin next month.

Finally, there is the question of the future of the four-power rights and responsibilities in Germany and Berlin. We have no desire to perpetuate these as anachronisms in a united country. We must therefore consider, in the framework of the two-plus-four meetings, how to tackle this issue in an orderly and satisfactory way. The Federal Republic is a close friend, ally and partner of this country. We admire the post-war achievements of her people. We look forward to a time when these can be shared by all the citizens of a united Germany, within a Europe where all divisions have been overcome and all can feel secure.

I think that in the CSCE, the Six and elsewhere we are moving towards the kind of solutions envisaged by the noble Lord Greenhill when he proposed in our debate in January a treaty for the pacification of Europe. I do not say that such a treaty is necessarily the best solution— the final form of a European settlement has still to be decided— but I hope that we are approaching a time when the countries of Europe will agree to be bound by certain common standards and principles, in a security framework accepted and supported by all.

These are the goals towards which Her Majesty's Government are working. We are developing links with the countries of Eastern Europe and the Soviet Union which reflect and reinforce the increasing community of interest between us. With our Western partners, we are pursuing programmes of assistance in support of the economic reforms which must serve as the basis for future prosperity, We are also looking ahead to the requirements of European stability and security in a continent transformed by the need of the cold war.

Uncertainties remain, but the prospects for reconciliation and renovation in Europe have never looked brighter. I hope that Europeans will be inspired and guided by them as we advance together towards a better future for all our countries and peoples.

4 p.m.

Lord Greenhill of Harrow

My Lords, I would like to apologise to the Leader of the House and to the noble Lord, Lord Home of the Hirsel, for the fact that I shall be unable to be present for the closing stages of the debate. It has been said again and again that the events of the past year are a turning point in history: that is indeed true. I believe that it is possible to have high hopes for the future if we are persistent and, above all, if we are patient. As the noble Lord, Lord Cledwyn, said, there is a long, long trail ahead.

What has happened to date has been largely acts of demolition. Evil regimes have been swept away; the path to democracy has been cleared; and the threat to peace has virtually disappeared. But an immense work of construction lies ahead. One has only to enumerate the agenda for 1990–91 to see the confusing complexity of the situation. I am not sure that I have included all the items on this agenda.

In the Soviet Union, President Gorbachev is facing up to the revolutionary task that he has set himself. But progress is slow and his economic plight is desperate. I have not recently visited the Soviet Union, but all visitors who come back now bring bad news. In Germany the process of unification has started, but the federal election still lies ahead and must preoccupy the party leaders. In the Community of Twelve there are preparations for inter-governmental conferences, not only on economic matters as agreed at Madrid, but now also on ambitious, political and constitutional proposals which we understand will shortly be put forward.

In addition, there are important negotiations in train between the Community and the EFTA bloc. In Eastern Europe there are elections and the task of drawing up new constitutions. For NATO and the Soviet Union there is a new security situation to resolve. For all of us there is an immense and conflicting investment demand in Europe, a similar demand still in the third world and, looking a little further ahead, possibly also in Southern Africa. The Commission has been given a most difficult task in co-ordinating all this. It is impossible to imagine sensible and consistent outcomes to all these matters if there is a headlong rush for solutions.

Those people who seem to fear that they may miss the bus need to reflect carefully upon whether matters are going in the right direction. That is why, in my view, although urgency is necessary, it must be combined with great patience. I would like to draw attention to certain questions, particularly concerning the Soviet Union, Germany, the United States and the Community of Twelve.

As regards the Soviet Union, distinguished historians have said that no empire has survived once it starts to decentralise. That, they say, will be the fate of the Soviet empire. It may well be true. Personally, I doubt it. And it is not in our interest that it should be so. I believe that, over a period of time, the Soviet Union, in a recognisable form, can and will survive.

The sort of democracy which the Soviet Union will develop is not of first importance to us. Nor is the issue of how it will cope with the emotional demands of the republics. What does matter to us is that the Soviet people are no longer putty in the hands of a few authoritarian leaders and will no longer accept ideological adventures. In future we shall be able to do business with them without undue fear and foreboding and with a greater degree of mutual understanding.

But the Soviet Union will want to remain a nuclear power with the capability of organising large conventional forces. Diminishing suspicion of Germany and the West will no doubt linger on, but it should be possible for understanding on defence matters to be reached. The Soviet Union's own first priority will be its economy.

In Germany, unification is taking place before our eyes. But there are countless political and social problems which, even with strong political will, must take German governments years rather than months to resolve. United Germans will make up their own mind;; on their future policies. Any rushed attempt to anchor or embed— which seems to be the latest word— them where they do not want to be will be counter-productive. It is inevitable in the months ahead that they will give priority to their own affairs.

On the prospects for the Community of Twelve I find myself in some doubt in the light of recent events. The advocates of the original Delors plan were all for pushing ahead at an accelerated pace. But they now find their ambitions supplemented by the plans of activists in the European Parliament who seek a greatly enhanced role for themselves and a reduction of the power of the Commission and the Council.

I recognise that there is a democratic deficit in the Community. I certainly do not think that it is the moment for the type of plans which are being bandied about. At the same time the Community of Twelve sometimes gives the impression that it wishes to retain a privileged position and keep at arm's length some countries which seem to be natural members of a Western European community. Would it not be better, in a measured way, to make a reality of the single internal market, seek a profound agreement with the EFTA bloc, and subsequently, at appropriate times, make association agreements with the Eastern Europeans? That would pave the way for a wider Community which is surely the most desirable objective for Europe.

As for the United States, I am sure that it is necessary and right for it to retain a security role in Europe. I understand that this is recognised and welcomed by the majority of Germans and indeed by some Russians so long as they retain any suspicion of a unified Germany. The United States obviously cannot have a seat at the Community table, as Mr. Baker once suggested, but it is an essential element in the stabilisation of Europe.

In the immediate future, surely one of the most important things to do is to push ahead with the two-plus-four discussions and develop them into a treaty which makes specific settlements of certain questions. That treaty should be absolutely clear about disputed frontiers. It would mark the removal of allied rights in Germany. Associated with this treaty, or integrated with it, would be disarmament agreements including troop withdrawals and a new definition of the relationship between NATO and the Soviet Union.

In making such a treaty the United Kingdom can play a leading part which would be welcomed. This, in my view, is as important, if not more so, than the accelerated development of the Community of Twelve, which has enough to do with the internal market in the next three years without raising new issues of an extended role for a two-chambered European Parliament and fundamental reforms of the Commission and the Council.

But if for Europe and the Western world we have high hopes for the future, we cannot ignore the fact that, powerful as Europe can be, we are a minority of the world population. We do not have a monopoly of advanced technology nor of vital natural resources, and the objectives of a non-proliferation nuclear treaty are still very far from being fulfilled. As much as we all need economies in defence expenditure, any British Government must bear in mind the possibility of global developments at present unforeseen.

4.11 p.m.

Viscount Eccles

My Lords, I thank my noble friend Lord Home for introducing the debate in a speech to which we all listened and from which we all learnt something. I am also pleased to follow the noble Lord, Lord Greenhill, because his knowledge of foreign affairs is unsurpassed in this House.

Last week The Times published an article by Sir Michael Howard. The gist of that article was contained in these sentences: There is a German problem … An alliance without the US would be an alliance dominated by Germany. The peoples of Central Europe and the Soviet Union… would see that as a threat". Well, we too, although we are much less fearful than the people in Eastern Europe, have to remember that twice in this century we have crossed the Channel to prevent a Europe dominated by Germany. In those experiences we have had proof that an alliance without the Americans is not capable of maintaining the balance of power in Europe.

However, M. Delors, the President of the European Commission, has other views. Speaking presumably for France, as well as for himself, he has been telling his considerable following that the social and political functions of the Community should be increased to the point where all the big decisions concerning Europe's future are discussed and settled in Brussels. The French have never had any wish to share power with the United States. They refused to allow the American bombers to fly over France when they were on their way to teach Colonel Gaddafi a lesson. The Spaniards, the Italians and the Greeks have shown resentment towards American bases, but they did accept American leadership so long as the two super powers were glaring at each other in the Cold War. But now, with the Warsaw Pact in disarray, is there any future need for American participation in the political affairs of Europe? What should be the British answer to that question?

As has already been said in the debate, no one knows what will happen in the Soviet Union. Caution and patience are therefore essential. But we can, and I think we should, make some assumptions about the long term. For instance, until the Soviets destroy the whole of their nuclear capability the West will retain its own deterrent. How do we rate the chances that after the reunification of Germany the Russians will trust the Germans to guarantee their security and will work harmoniously with them, perhaps in the Community, to revitalise their own economy and the economies of Eastern Europe?

I wonder how much personal experience noble Lords have had of the enmity which the Russians feel towards the Germans. When I was President of the Board of Trade I went to Moscow to make a commercial treaty. Mr. Khrushchev asked me one day, "Do you believe in the devil?" "I do", I said, "but do you?" He replied, "Oh yes, and I know who he is— Dr. Adenauer". Mr. Khrushchev was thinking of the 20 million Russians who died in the last war, and that tremendous sacrifice is remembered today by all the Russians whom I know. It should therefore be assumed that the Soviet Union will ask for guarantees of peace and will not trust the Germans to give them those guarantees. Only the Americans can do that for Europe.

We should welcome the participation of the Americans in European affairs for another reason. We are all looking for new initiatives and new relationships, not just between the countries of Western Europe but with the rest of the world. As has been said, huge opportunities are opening up before us. With the reduction of the military threat we can pay more attention to social, cultural and economic progress, especially in the less developed countries. The titanic revolution stimulated by the media feeds on the instant coverage of everything that happens, every day, everywhere. One result is that all nations can now see each other. They can compare each other's standards of life. The information network puts before all of them the same world problems of poverty, population, environment, refugees, terrorists, trade, exchange rates and so on.

For the moment, I suppose, we here are preoccupied with the prospect of free trade and responsible capitalism flourishing throughout Western Europe. Western Europe is a trading area which can be defined, marked on the map and policed at the boundaries. By contrast, the political and social problems in which we are all interested stop at no frontiers. Television and radio carry them around the globe.

Most of these problems are obviously too widespread and too contagious to be dealt with on a continental scale, as I understand the French would wish. Instead, combined action is called for in groups of nations brought together by common interests. In most of those groups the United States will have to play a leading role. Great Britain cannot go it alone in the modern world. Who then are our best and strongest friends and allies? Who speaks the same language as we do? In whose schools and universities are English literature and English history taught as key subjects? In which economy do we have our major overseas investment? With whom, if your Lordships were to look around the United Kingdom, do we have so many blood relationships and so many family ties? Since in this shrinking world we have to share our sovereignty, we should do so with our best friends and in organisations designed to leave the door open for Eastern European countries and the Soviet Union to join one day.

President Gorbachev is also seeking a new balance of power. He knows that he will not find it in an alliance of which the United States is not a member. In any case, the timetable rules out the European Commission as an alternative to negotiating through NATO. It will take two years or more before the 12 members come to a decision on how much political power they will give to the Community. However, in the very near future action must be taken on the relations between the Soviet Union, a reunited Germany and the rest of us. That action can only be debated and decided in NATO, because NATO is the agency of which the United States is a member. As the noble Lord, Lord Greenhill, said, NATO has to be revised so that it can deal not only with the military problems but also with a great many of the world problems which will grow in importance.

I am sure that some of your Lordships heard this morning at breakfast time a broadcast which stated that Mr. Gorbachev had given the United States assurances about troop movements in Lithuania. He did not give it to the Community and he did not give it to Germany; he gave it to the United States. That is how the whole process will go.

Finally, I think that we should send a message to the Prime Minister stating that a revised NATO, rather than the Commission in Brussels, is the agency through which we are going to work to ensure the stability and the prosperity of the post-Communist world.

4.22 p.m.

The Earl of Perth

My Lords, I rise to make one point and only one point. Having heard the speech of the noble Viscount, Lord Eccles, who made my point so well and so skilfully, I hesitated before I rose to speak. Nevertheless, as my name is on the speakers' list I shall proceed. No one, not even the noble Lord, Lord Home, who so courageously and bravely opened the debate, can forecast the future of the European Community, including, for example, how Eastern European countries and Russia will join in with us. But, whatever the developments may be, it is vital— this is my point, which was also made by the noble Viscount, Lord Eccles— that the USA remains involved.

We Europeans must consult the Americans on every move we make and take them with us. The noble Viscount, Lord Eccles, pointed out how they came to our rescue in both world wars. However, I should like to look at the situation from a slightly different angle. What happened after the first world war when America did not join the League of Nations; what happened in the tragedy of Suez when we and France went it alone?

I turn now to Germany. I think that over the next years a united Germany will not only prove to be a good and true member of the Community, it will also have a leading part to play in the economic and other developments of Europe. But it is even more important to know that America will be involved.

Let us remember that the vast majority of people in America are made up of inhabitants whose ancestors all came from Europe. Therefore they know about it and are deeply concerned about developments. I repeat, America must be a part of the development process. It must support, or at least we must be assured that it goes along with, what the Europeans, West or East, do. Moreover, whatever we may do to help ourselves build a new Europe, they must be a part of it.

The noble Lord, Lord Greenhill, pointed out that Mr. Baker suggested that perhaps the Americans should have a seat in the Community. However, he said that that proposition was not on. I wonder about that. I think that we should give careful thought to that prospect. If America does not actually have a seat, it must be an observer— and perhaps more than an observer. I should not be afraid if that gesture was made. Let us think about taking up that suggestion.

In my view the Americans must be physically involved. That means that not only should they do anything which was needed in relation to economic aid, but also they should keep some forces in Europe. As to where and how many, that is, in a sense, unimportant; the fact is that they should be there.

I strongly believe with all my heart, and because of all my experience, that this is the keystone for an enduring peace and progress. The Western world can achieve great things if we work together. But, as I said, the keystone is working with the Americans. Without their involvement I should be fearful for the future.

4.26 p.m.

Viscount Brentford

My Lords, I should first like to thank my noble friend Lord Home for instituting the debate. It is with fear and trepidation that I intervene to speak among so many other far more experienced Members of your Lordships' House. I should also like to apologise to the House for the fact that I am shortly due to board an aeroplane and therefore shall not be able to stay to hear the end of the debate.

The question of freedom for parliamentary and economic matters in Eastern Europe is indeed very exciting. I should like to illustrate what my noble friend Lord Home said about the economic independence of Eastern Europe, and also what my noble friend Lord Brabazon of Tara said about the market opportunities, by citing some interesting figures which I saw about the number of joint venture agreements which have now been entered into between those countries of Eastern Europe and the countries outside, or between commercial ventures in them.

In many cases during the course of 1989 the number of joint venture agreements quadrupled. That seems to me to be a very substantial increase in co-operative commercial enterprise. In the case of Poland, the number during 1989 rose from 26 to about 400, which is a very substantial increase. In Russia the figure similarly rose, from 162 to probably 1300. That shows that the economic co-operation is expanding at a very fast rate. I believe that that is very good, both for the countries of Eastern Europe and for ourselves.

I should like to make two specific comments on the political scene. I have read that in Westminster we are holding political seminars for parliamentarians in the new democracies of Eastern Europe. I am not sure whether that was included in what my noble friend Lord Brabazon of Tara referred to in his speech. However, I believe that it is something which should be strongly encouraged. I do not know whether the seminars are being held only in Westminster or whether we are also offering help, from our experience as the mother of Parliaments, on parliamentary techniques in the capitals of these other countries. If they are wanted by those countries, I hope that this will be an ongoing support that we can offer them.

The second point I should specifically like to make concerns the question of a united Germany being a part of NATO. This was strongly put by the noble Lord, Lord Cledwyn, and again emphasised by my noble friend Lord Brabazon of Tara. I believe not only that it is a good thing, but that it is a cardinal point for the security of Europe that the united Germany should be firmly within the framework of NATO.

I have never forgotten that some 40 years ago in Germany I was talking to a young German who was the same age as I was. He said to me that if another leader came along like Hitler and did something as popular and as powerful as Hitler did in making roads in Germany, "We will follow him again". I believe that the future security of Europe on the German question depends on it being within the strong framework of NATO, and I hope that my noble friend in the Foreign and Colonial Office will work hard for that to come to pass.

There is another aspect that I think has not yet been mentioned in your Lordships' House but which I should like to emphasise, and that is what I have called the need in Eastern Europe for wholeness of life and a sense of the important values for individuals and also for families in those countries. I should like to illustrate what I mean by certain examples. I have read that it has been said that we need to learn that people in Eastern Europe need themselves to learn to live with freedom. When they were saying something private in the past in many of these countries they would have to turn on the radio full blast, or put the bathroom taps on full blast, in order to drown the bugging devices, they are now living in a totally different situation from what they were a year ago.

It is dangerous to generalise and I know that there are many differences in different countries, but in many of them the people have lived with this situation for so long and they are now in such a different situation that we need to understand their position. There is a mental and emotional leap that they are having to take very quickly, and it is not easy. There are divisions in society that need to be healed, but there are also divisions in the individual that need to be healed. We need to see this sympathetically.

The second illustration I should like to make is what I call the moral factor. May I quote from President Havel, who has been mentioned several times in this debate.

The worst is that we live in a spoiled moral environment. We are all morally sick, because we all have got used to saying one thing and thinking another. If individuals have been living like this for nearly 40 years it is a difficult situation to get out of overnight. Again this calls for sympathy and understanding by us in our dealings with individuals there. I hope that there will be many relationships to be built in this way.

Thirdly, I should like to emphasise the role of the Churches in bringing about this peaceful revolution in Eastern Europe, particularly and noticeably the Roman Catholics in Poland, the reformed churches in Czechoslovakia, the free churches in Romania, and the Lutheran churches in Eastern Germany, just to pick a few denominations. They have played a great part, and a sacrificial part, in bringing about what has come forward. I have read that it has been said by different people that the collapse of the Berlin Wall was an answer to prayer as much as when the walls of Jericho came down may years ago.

It is perhaps a truism to say for the benefit of our churches— I see that the only episcopal representative earlier in this debate has now left— that the persecuted churches are probably a great deal stronger, and have a more vital spiritual life, than the churches in the softer living West. I believe that we in the western churches will have a lot to learn from the life of the eastern churches. Nevertheless there is a great need in Eastern Europe which can be met both by the churches in the West and also by other Christian organisations. I know from my own experience that a lot of material as well as spiritual help is going into Eastern Europe from these resources. But I believe it is vital that we go to help Eastern Europe as servants, to serve them from a position of humility, and I hope that this will be remembered in the future.

Marxism is often seen as a religion with the state, as God, being idolised. The state has now been dethroned in these countries in Eastern Europe, but, like my noble friend Lord Eccles, I too believe in a devil, even if I do not see him in quite the same shape perhaps as Mr. Khrushchev saw him. I believe that there is a vacuum now, morally and spiritually, in many of these countries of Eastern Europe, and it is important that that vacuum is sensibly filled.

There is a battle for the minds, the hearts, and the souls of the people of Eastern Europe, and we need to be aware of that. I hope that it is not materialism, pornography, and other evils that fill that vacuum and win the battle for these minds. I hope that we shall do all we can in our way to ensure that the people of Eastern Europe gain a sense of the important values of life, and learn to live a whole, balanced and really fruitful life in their new-found freedom.

4.37 p.m.

Lord Kagan

My Lords, in addition to material help, the Baltic states need Western guidance on how to proceed, because insistence on too rapid change can jeopardise the very objective of attaining independence. The legal right of the Baltic states— Lithuania, Latvia and Estonia— to seek independence is not questioned by anyone, but the choice to have that right has been given by President Gorbachev. The pace at which it is pursued could jeopardise and endanger Mr. Gorbachev's position.

With his consummate skill, Gorbachev managed to use the pressure exercised on him by Lithuania declaring unilateral independence. In facing Gorbachev with an accomplished fact which could be mistaken for an arrogant, defiant gesture, Lithuania united behind Gorbachev the left opposition and the right opposition within his own Parliament. His opponents were previously attempting to prove that his efforts to liberalise were leading not to democracy but to anarchy and to the dissolution of the Soviet empire.

Gorbachev has for a long time questioned and probably abandoned his belief in Communism, but it would be a fatal mistake to assume that he is not a patriot. He is not in business to see the Soviet empire abolished. He would not have lasted so far if he did not have solid army backing behind him. That is not to be forgotten.

The Western world, particularly the United States which has a sizeable and influential Lithuanian minority, wishes the Baltic states well. There are more Lithuanians living in Chicago than in the capital of Lithuania. From the United States signals have been sent out which always expressed unqualified support for Lithuania's aspiration to become independent. The United States never formally recognised Stalin's acquisition of Lithuania. However, it has indicated recently that it would delay formal recognition pending discussions between the Soviet Union and Lithuania. Other governments in the West stopped short of recognition at this time. The message from the United States was the good girl's message, "The answer is not 'No', but 'Not yet' ".

In an official statement, France reminded the Baltic states that it was Gorbachev who made the present choice possible. The British Foreign Office, through its Minister, William Waldegrave, said that it was fascinated by what was happening, but the time was not yet.

The point I am trying to make is that hints should come from outside to the Baltic countries to watch the pace at which they pressurise the man on whose success their freedom will depend. People have expressed doubt as to whether Lithuania, Latvia or Estonia could survive economically. It is my belief that Germany and Russia are getting together economically. Germany has always been the dominant economic force, the technical language in Lithuania being German. Germany and Russia between them will be able to support and help reconstruction there. It is interesting to note, incidentally, that the German foreign office was muted on the announcement of UDI. It said that it would await results of negotiations between the Soviet Government and the Lithuanian Government.

I wish to say to your Lordships that the powers which Mr. Gorbachev obtained are similar to those under Article 48 of the Weimar constitution. It is easy to forget that Hitler assumed full powers entirely constitutionally with the help of the tremendous powers given to the president of the Weimar republic. When given, the powers were meant to prevent dictatorship, but they actually enabled it to happen.

Probably what Mr. Gorbachev hopes for is to present a Finland solution for the dependent states which will probably extend beyond the Baltic states to Moldavia and so forth. The democratic roots in Eastern Europe were never very deep. The hatred of a Stalinist type of despotic tyranny should not be mistaken for a yearning for democracy. Democracy in Central Europe will depend on whether— as the noble Viscount, Lord Brentford, said— the nations are capable of handling it. I think that the Europe we shall see will be dominated by German technology and Russian manpower working in harmony and Central Europe sandwiched between. It has American support.

4.46 p.m.

Baroness Elles

My Lords, over the past few months we have been watching an extraordinary cascade of events. It has been beneficial and interesting to sit back for a little while in your Lords lips' House and discuss the Motion. I join in expressing my gratitude to my noble friend Lord Home of the Hirsel for introducing the debate. We have already heard quite a few different opinions, and the spectrum is so wide that some of us— certainly myself— can only address one or two issues, as I shall in the few words that I wish to say.

I have noticed that one or two noble Lords have felt the occasion suitable to denigrate a little the European Commission. However, it is noteworthy and encouraging to remind ourselves that President Bush asked the European Commission to establish the mechanism to organise the aid programme for Poland and Hungary which has now been extended to include Czechoslovakia. The United States keeps in full contact with the Commission since the aid programme is based not only on the Commission's action but is in conjunction with the Group of 24— that is the OECD countries, which include the United States and Canada.

I wish to emphasise that it is not a question of the Commission getting too big for its boots, as seems to have been the view expressed. It is doing the job it was asked to do in co-operation with those states which have been mentioned by many noble Lords.

The European Community has already set up funding arrangements and put into effect programmes to send humanitarian aid in the form specifically of medicines and food to these countries. I add again that the European Parliament requested and insisted on an increase in the funds which were clearly inadequate for the task which they were expected to carry out. The amount was something like 200 million ecu to begin with; the parliament insisted and the council agreed that this should be increased to 300 million ecu. No doubt at the end of the clay the figure will be considerably more than that.

There is one word of caution on the kind of economic assistance that is expected to be given from the West to the Eastern European countries. In mentioning those countries I leave out the Soviet Union in this context, which I believe is a separate issue on its own, which sets up quite different problems from those about which I wish to talk now.

There is concern that these countries should not be encouraged to produce goods of inferior quality and expect to be able to export them successfully to the European Community. If the Community is expected to open up its markets— which include the United Kingdom— it would be perfectly right and proper, since everybody wishes the US to be involved in all this activity, to insist that the Group of 24 should also be ready to open up its markets. This will be in order to assist countries which are not even reviving but are initiating economic prosperity. It will enable them to have access to those markets.

There is a need to concentrate particularly on the agricultural sector in order to provide food and make that sector more self-sufficient. That sector has clearly been one of the major deficiencies for the people of Eastern Europe. There will also be immense difficulties as regards the most basic issues such as land ownership reform, mechanisation, agricultural expertise and even the distribution of food. People who have not been to Eastern Europe recently will have no idea of the immense difficulties which will arise.

The programmes that are envisaged will need considerable financing. They should be financed by contributions from OECD countries and not just from the European Community. The issue of how much should come out of the European Community budget has already arisen. That matter affects the Government in terms of how much the United Kingdom should contribute. However, I believe the European Community and the OECD countries should unite in contributing to the financing that is required.

Encouragingly, requests for assistance are being met positively and some trade and co-operation agreements have already been signed between Poland, Hungary and the EC. Requests are now already being received from the GDR, Bulgaria, Czechoslovakia, Romania and Yugoslavia. The European Community has wisely established certain conditions and certain undertakings that must be met regarding the rule of law, respect for human rights, the establishment of a multi-party system, the holding of free and fair elections in the course of 1990 and economic measures which will lead eventually to a free market economy before it signs agreements. That is a prudent and sensible consideration on the part of the European Community and reflects many of the views which have been expressed by your Lordships. The European Commission will monitor the progress of those conditions before any agreement is signed.

At this point I must remind your Lordships of the importance of the Council of Europe. I believe that is the only body that has not been mentioned so far in this debate. As one of its conditions of membership, that body requires ratification of the European Convention on Human Rights. That convention is controlled by the European Court of Human Rights. Many Eastern European countries have already requested observer status. I believe that one of the conditions of eventual closer membership within Western Europe would be membership of the Council of Europe as a guarantee of democracy and a democratic system.

However, the general needs of all these countries appear to be similar. They need a flow of external finance, technical assistance, technology transfer and training. The European Community has already set up an active and dynamic training programme. However, we must ask what the outcome of that programme may be. The Soviet Union, having now renounced economic and financial support for these countries through encouraging them to adopt democratic systems, has managed to transfer its former obligations, which it adopted at the end of the war, to the West. We must realise that in assessing the role we want to play in restoring and sustaining these countries.

While giving economic assistance, it may be wise to encourage these countries to retain some form of Comecon in order to benefit from their own mutual economic revival. They are, after all, at pretty well the same economic level that we in the West had attained after the war. That is an important aspect to remember when trying to encourage these countries to produce for themselves and for countries nearby. It will take several years for these countries to reach European Community economic standards and to consider the association agreements which could flow later on. Association agreements could lead in the distant future to membership of the European Community. However, that implies a considerable undertaking and obligations on the part of these countries. That at the moment is almost unimaginable. That is a long-term prospect.

I believe that I can summarise what I have been saying under approximately four headings. I do not believe it has been emphasised strongly enough yet that the shambolic effect of communism both as a political and an economic system on the lives of people must be recognised and never forgotten. While pictures have been shown of ecstatic crowds celebrating the lifting of the blanket of political oppression in Eastern Europe, very little has been shown of the derelict land, crumbling and decaying housing, appalling hospitals and the labour force there which is no longer willing to work because there is nothing to purchase with its wages. There is a complete lack, because of the system, of people who know anything at any level about accountancy, banking, communication and retailing. Those are all elements which contribute to a successful economy based on a capitalist system or a social market economy.

We had the honour of a visit from the President of Free Romania to the Palace of Westminster not long ago. He had just returned from Romania. He told us that Romania had precisely one television station and one newspaper. That is not a symbol of democracy. He had persuaded Mr. Iliescu, the acting president to introduce another television station and to provide a printing press and paper to publish another newspaper. Those are the kinds of difficulties that these countries are now experiencing and they show why they need our support.

In its support both for freedom and for prosperity the Commission must ensure that these countries are encouraged to embark on a system which will lead their people from poverty and decay to hope and success. While I do not seek to stress the comparative wealth and quality of life of citizens in the European Community, it must be emphasised that the multilateral treaty which binds our 12 member states together guarantees peace between us in an increasingly uncertain world. That was a point made by the noble Lord, Lord Cledwyn, as regards the role of the European Community and how over the past 40 years it has been unimaginable for countries in the West to go to war with each other. We cannot afford therefore to allow existing links to be weakened. On the contrary, I believe they have to be strengthened. I do not propose to discuss the kinds of constitutional problems which may arise, but the principle of the matter is that the European Community must not be weakened but strengthened.

Many noble Lords have mentioned the multilateral treaty, NATO, which binds Western European countries together in a defence system. That must remain the linchpin of our stability. With the uncertainty of events in Europe and within the Soviet Union it is now more necessary than ever to strengthen our links with the European Community and the United States. Reference was made to the proposal of the noble Lord, Lord Greenhill of Harrow, to have some kind of treaty. If there is to be a treaty at all, I would propose one between the European Community and the United States for defensive, political and economic reasons. Ultimately it is only from strength that we shall be ready to meet whatever eventuality may arise and in the meantime play our part in helping these countries to raise their standards of living and in giving them hope and prosperity.

4.59 p.m.

Lord Dacre of Glanton

My Lords, in the recent debate on German reunification the noble Lord who introduced it touched lightly, in summing up, on the timidity or hesitancy of historians in approaching that subject. We are, perhaps, a rather timorous breed. That is not because we are incapable of enthusiasm. I do not think anyone could have watched the series of revolutions that has appeared on television recently without emotion. That was the first time that one could watch revolutions happening before one's eyes. However, if we are slightly reserved in our attitude and we correct our emotions, it is because, by the nature of our profession, we have been there before. We have seen the euphoria of past revolutions followed, sometimes quite quickly, by disillusion and reaction, sometimes even by terror and war. We have seen 1789 followed by 1793; 1848 followed by 1851; and 1918 folowed by 1922.

In this context, I think particularly of 1918–19. At that time the Western allies liberated Eastern Europe. An extraordinary situation existed. Not only had our overt enemies, the central powers, been totally defeated, but so had our eastern ally, Russia. Then; was a complete power vacuum in Eastern Europe. In that vacuum, without perhaps knowing a great deal about the detail, animated by enthusiasm and some transatlantic encouragement, and believing that nationalism was per se a good thing, we were able to recreate a whole series of states: Poland and Lithuania, which had lost any trace of independence since the 1790s; Estonia and Latvia, which had never had an independent existence before; Bohemia and Moravia, which had lost their independence in 1620. Then we altered the frontiers of Romania and Bulgaria. We could do exactly what we wanted in Eastern Europe. We set up what we believed were liberal democracies in our own image.

That surely was a very good and liberal thing to do. Unfortunately the situation was entirely artificial. It was only possible because both Russia and Germany were totally defeated, prostrate and in revolution. They could do nothing to prevent it. Twenty years later we had relaxed in the comfort of our total victory. Germany and Russia had revived and had no difficulty in, between them, gobbling up all those states one after the other. We could do nothing. We could offer guarantees, but what were they worth? They led us into a war which we very nearly lost. That is a chastening thought and one which naturally occurred to me when I considered the subject.

The second time round we may be more successful. The situation now is slightly different. There are similarities, but no historical situation ever reproduces itself exactly. As a result of victory in the last war we reconstituted some of those states. We could not reconstitute the Baltic states because Russia had not collapsed. However, Russia has now collapsed and we are in the extraordinary situation of having everything that we wanted at the end of the war.

At the end of the war, in 1945, what did we want? We stated openly that we wanted a united Germany, provided it was non-communist, and provided it was shorn of the eastern provinces which we had agreed should go to Russia and Poland. We wanted the lesser states of Eastern Europe to be free again. We recognised that the Russians had what Sir Michael Howard calls a droit de regard towards them, but we did not want them to be communist, we wanted them to be independent. We wanted Poland to be independent and we wanted them all to be independent. But we recognised that they were within the Russian sphere of influence.

We lost that part of our peace settlement, such as it was in 1945. Now it has fallen into our hands. Russia has not been defeated in war, but it has collapsed and its empire in Eastern Europe has collapsed. So here we are with what we wanted in 1945, with Germany on the point of being reunited, non-communist and allied with us— a liberal democratic united Germany— and the states of Eastern Europe set free. We ought to be very pleased.

However, we have reservations. What are those reservations? We have reservations because we are not totally sure about Germany. When in 1945 we thought of a united, independent, free and democratic Germany we did not expect it to be as powerful as it is now. We did not expect the Wirtschaftswunder, the capacity to dominate Europe even when divided. Therefore we are a little alarmed at that. We ask ourselves whether it is possible that the old spirit might return. My noble friend Lord Brentford told a story to indicate that one person in Germany does indeed think that. I could cap that with stories of the Germans that I met in 1945 who thought differently. It depends on the company you keep.

Looking at the history of Germany as a whole in recent times, I am prepared to risk an opinion. I believe that there has been a fundamental change in German mentality since 1945. There was no such change in 1918. In 1918 the Germans did not believe that they had been fairly defeated. They had been, but they would not believe it. Their tradition, their historical attitude and the teaching in their schools, remained the same after 1918: the teaching of the old Wilhelmian German empire. It was preserved by the German elite in the universities and in the cooking of public documents which deceived us all. They deceived me when I was an undergraduate and read books which were written under false impressions derived from fudged documents published by the German Government under the title Die Grosse Politik der Europä ischen Mächte.

That is all over. It ended in the 1960s. I am prepared to argue this at length, but I am conscious of the time and shall not do so. I shall simply give noble Lords the benefit of my conclusion. It is that I believe that there has been a fundamental change in German historical attitudes, historical teaching and historical tradition. That is demonstrated in the famous Historikerstreit in Germany two or three years ago. Therefore, although I realise that I am taking a great risk, I am nevertheless prepared to take that risk. I am prepared to trust the Germans, in spite of the German my noble friend Lord Brentford met in 1945. So that reservation, in my view, does not now exist. Furthermore, powerful though it is, Germany is not as powerful in relation to other powers as it was in 1939.

We also have reservations about Russia. Anything can happen in Russia. I should not dare to make any prophecy about what might happen in Russia. Something disastrous may happen. A Bonaparte may take over if Gorbachev fails. However, at present, however delicate the balance may be, I believe that we can act— very provisionally, tentatively and timidly— on the basis of the information that we have. There is a situation in which, provided we are careful, we can watch and help the restoration and preservation of the kind of liberty which since 1918 we have wanted for those eastern states which lie between Russia and Germany.

There is one absolute condition which must be met. That is the preservation of the Oder-Neisse line. We must prevent the Russians from having a legitimate fear of a threat to their legitimate reason of state. That I believe can be secured by an absolute guarantee. We have the nearest that we can achieve to such a guarantee in the present circumstances in the form of Dr. Kohl's assurance on the Oder-Neisse line.

What then do we want for the intermediate states which have been newly liberated from communism? I know what I want. Since it is so difficult to make any prediction or to calculate on the basis of events which are changing so rapidly at present, the best thing one can do is to look past the present events and the present means to the ends. What kind of a Europe do we want? I know the kind of Europe that I want. It is not a uniform, homogenised, Americanised Europe. Europe consists of a number of countries and those eastern countries— Poland, Bohemia and Romania among them— have a historic identity and traditions, and deserve to be allowed the right to keep and nourish them. Nor do I want Germany to be totally westernised according to the ideas of France and England. There is a great German intellectual, artistic and musical tradition which is appropriate to it. It is its own property which it should keep.

In General de Gaulle's phrase, I want a "Europe des patries". I should like those countries of Eastern Europe to stand on their own feet and to be independent. I do not want them to be a mere buffer zone or Russian colonies; but I do not want them to be western colonies either. I want them to stand on their own feet to nourish their own culture and to be proud of it and to be supported by us, not in the way that we have supported new governments in Africa and Latin America, by pouring out funds which have gone down the drain, but in the way that Marshall aid was used to support the shattered Europe after 1945.

I often think of a phrase by Gibbon. Gibbon describes the Europe of his time as: One great republic whose various inhabitants have attained almost the same level of politeness and cultivation", and whose political diversity in history has been the chief condition of its constant improvement, thus differentiating it from the immobility and decay of the later Roman Empire. That is what I want for Europe and I want Eastern Europe to be part of it.

5.12 p.m.

Lord Moore of Wolvercote

My Lords, we had an excellent debate in January on the Motion of the noble Lord, Lord Callaghan, on the unification of Germany. Now, like other noble Lords, I am most grateful to the noble Lord, Lord Home, for giving us the opportunity of pursuing the theme with his Motion on the future of the countries of Eastern Europe and the Soviet Union.

In our last debate I expressed the hope that the smaller countries of Eastern Europe, sandwiched between the great powers of Russia and a unified Germany, would be allowed to work out their own salvation. Now, even before Germany has been reunited, we have seen signs of a threat to Poland's border. Fortunately, the West German Chancellor has been forced to retract his threat to the Oder-Neisse line, but a chill of apprehension will have passed through the Poles. Is it going to be the same story all over again?

The Poles are right to be apprehensive. International politics are basically concerned with power and everyone in Europe realises that power will lie increasingly with a united Germany. So it must be in Britain's interest to maintain a close and cordial relationship with the Germans. The prerequisite for that is that we should welcome German reunification without reservations, first, because it is right— the Germans are one nation— and, secondly, because it will happen anyway and all we do by being half-hearted is to lose the friendship of the Germans. They will not lightly forget those who cavilled and failed to give them full support at this dramatic moment in their history. However, if we support the Germans at this critical time, we shall be in a much better position to influence events in Eastern Europe. I have therefore been much reassured by the Prime Minister's comments on the East German election results and particularly by what the Minister has said this afternoon.

What kind of Eastern Europe do we want? First, we must hope for stability with no threats to the existing borders— not only the Polish borders, but all others in Eastern Europe. Secondly, we shall be looking for democratic forms of government— not an easy task, as other noble Lords have said, in countries with little experience of democracy. Thirdly, we want the smaller countries of Eastern Europe to flourish economically so that they can trade effectively with the European Community.

The integrity of the borders depends largely, but not entirely, on Russia and Germany and we must have good relations with both if we are to influence them at all. However, the problem lies not only with Germany and Russia. With the heady excitement of freedom, there is a danger that the smaller countries of Eastern Europe will become excessively nationalistic. It is of course to be expected that they should rejoice in their new-found freedom as independent nations and nationalism is bound initially to be prevalent.

In that situation, surely the European Community has an important part to play. We have been learning, rather painfully in Britain, that the extremes of old-fashioned nationalism have no part to play in the Europe of the 21st century. Perhaps, therefore, we should try to bring the countries of Eastern Europe into some kind of loose federal arrangement with the European Community. That will require a great deal of patient negotiation, but the Community must help the Eastern European countries to take the best advantage of the future that has so miraculously opened up ahead of them as a result of Mr. Gorbachev's dramatic changes in Russian policy.

It is on my second point— the development of democratic institutions— that Britain can make her most telling contribution. Our academics are greatly respected in Eastern Europe and it is heartening to know that already British constitutional experts have been invited to advise in Poland, Hungary and Czechoslovakia. The problems are immense. Most of the countries have no experience of democracy. For example, how does one explain that the chief executive of a local government council is a servant not of a political party but of the state and that he or she must give equally loyal service whichever party is in power? But the British know how to make such a system work and I believe that we really can help in that field.

Finally, we must seize whatever trade opportunities we can. The Germans will dominate economic development and we cannot hope to compete with them in heavy industry. However, there will be opportunities and openings for our industrialists and businessmen and I hope that the Department of Trade and Industry has already begun to identify the areas where we are most likely to succeed and where we should target our efforts. The Germans were already there yesterday. We must be there today and not wait for tomorrow.

This is a tremendously important development in the history of Europe. Let us please spare no effort to ensure that Britain plays a constructive and significant role in these great events.

5.19 p.m.

Lord Fanshawe of Richmond

My Lords, like other noble Lords, I welcome the initiative of my noble friend Lord Home in introducing this debate today in a remarkable and imaginative speech. I particularly want to intervene as I served my noble friend for four years as his deputy in the Foreign Office in the early 1970s. It is perhaps a somewhat doubtful claim to fame that I negotiated the exchange of diplomatic representation and ambassadors and signed the treaty between this country and the GDR in the early 1970s. Indeed, in 1972 I had the privilege of opening the British Mission in the Unter den Linden and stayed the first night there as a visiting Minister in the British residence in East Berlin. At that time little did I think, when the whole of Eastern Europe appeared to be frozen solid into a Communist regime, that the day would ever come when the events that we have seen over the past six months would take place.

I share the amazement of other noble Lords at the speed and swiftness of these dramatic developments. As noble Lords have mentioned, we now confront the fruits of our major success of a victory in the Cold War. However, there are some real dangers that have been indicated by Members on both sides of the House. One danger stems from the fact that all our Western eggs appear to be in a Gorbachev basket.

Why is that? We have no alternative. I do not think any of us would wish to see a reversion to the hostile regime that dominated Eastern Europe for 40 years. Nor do we wish to see a move to a strong military dictatorship, which might well be the alternative to the present leadership by President Gorbachev. We all hope that a stable society will develop in Eastern Europe and that President Gorbachev will achieve a similar solution in Russia. But we must recognise the difficulties that he faces in moving— we hope in due course— from a command economy to what is called a capitalist system, and also with the withdrawal of Soviet troops from Eastern Europe. It underlines the problems faced by President Gorbachev and the economy of the Soviet Union when most of the discussion between Eastern European countries and the Soviet Union regarding the withdrawal of troops concerns the difficulty that the Soviet Union will have in finding barracks to put them in. That shows the parlous state of the Soviet economy.

Another matter I wish to mention (I do not think it has been touched on by any other noble Lord) is the problem of new political parties. As we have seen, East Germany has produced Western style political parties, one of which, linked with the CDU in West Germany, has now taken over the government in East Germany. Another is linked with the SDP. On this side of the House we welcome the great victory on Sunday of the centre right grouping in East Germany.

However, when one looks deeper into the matter one soon discovers that that system may not spread throughout the rest of Eastern Europe. There is a tendency in Slav countries not to opt for a Western style party political system. For instance, in Yugoslavia, so long as there was strong and vigilant leadership, as existed for many years under President Tito, an extraordinary conglomeration of nations held together very firmly. But when Tito went, the country tended to split apart.

New parties in Slav states tend not to follow the Western style; they become nationalist parties. One finds nationalism springing up and the horrors of nationalistic attacks, as happened dramatically in the southern Soviet Union involving Azerbaijan and Armenia only a few weeks ago. Only today we read in the press of the drama that has been taking place over the past few days with the Hungarian minority in Romania. It is a matter of considerable concern.

New political parties are developing in the Baltic states because— as indicated by my noble friend Lord Dacre in a remarkable and interesting speech— they used to have democracies. These operated for only a short time— about 20 years; nevertheless democratic systems did operate. Romania has never had a democratic system. Certainly, Bulgaria has never had one and Yugoslavia has not had a proper one. So although East Germany, Czechoslovakia and even Hungary will produce democratic systems and parties in a Western style, which may function well, we shall have to watch carefully to see what happens in the Slav states. The dangers of fissiparous tendencies occurring in some Eastern European and Slav countries along the line of what is happening in the Soviet Union today must be very close to us.

I recognise that and I applaud, unlike the noble Lord, Lord Thomson of Monifieth, the Prime Minister's cautious approach which aims to achieve a proper framework for discussion of all these issues. When the whole of Eastern Europe is in flux, it is no good settling down in a chair and saying without thought and care, "This is marvellous. We shall now put together a new system and new arrangements in Europe". The Prime Minister's efforts to achieve a proper framework are already proving successful. After all, I understand that it was a British initiative which put together the two-plus-four discussions which will now take place over Germany, although I gather that the four are now moving to five because Poland is to be invited to come in and that the two are perhaps two no longer but one because East Germany, in the very near future, will be fully united with West Germany.

The other aspect of the Prime Minister's approach lies in her personal relationship with President Gorbachev. That personal relationship could prove to be a means of keeping the new united Germany anchored closely into NATO. I should like to see a development within the European Community and in NATO which, while preparing for a united Germany's economic domination of Europe (which I believe is probably inevitable) does not allow that new Germany to relapse into a pan-German nationalism.

Again, my noble friend Lord Dacre was most encouraging in the conclusions that he drew, based on history and great and wide knowledge of the developments in Germany over the past 40 or 50 years. He does not fear a revival of the type of Germany from which we suffered in the 1930s and 1940s. It is also worth pointing out that the Germany from which we suffered in the 1930s and 1940s was born in confusion, massive inflation, heavy unemployment and great misery. Today the Germanys at which we are looking are quite different. West Germany, which will dominate a united Germany, is prosperous and well run. It is in a totally different economic situation from the Germany of the time of the Weimar Republic in the 1920s.

It seems to me crucial during this period that we work closely with our friends in France. Perhaps not enough attention has been drawn to our old friend and ally, the French. We must recognise that inevitably France will pursue her own interests. She always has done and always will. We must also recognise that we should pursue our own interests. But in many areas we hold interests in common with our friends in France. We share the view that there should be a stable Polish frontier. We are opposed to the neutralism of Europe. We support the development of NATO. And both France and ourselves are nuclear powers.

Both countries consider that we need America and its continuing involvement in our Continent of Europe. We believe that the costs of German unity should not fall on the French or the British taxpayer. I hope that my noble friend the Minister will take account of that during the months ahead and in the negotiations on setting up the new Europe.

We also agree with our French friends that we need and will not isolate our German friends, keeping the new Germany in NATO and in the European Community. We must work closely with this Germany which is developing so rapidly day by day. Unification will certainly happen this year in my view, and Britain and France, within the constructive framework of the alliances of the European Community and NATO, will help to achieve a newly balanced Europe.

5.30 p.m.

Lord Gladwyn

My Lords, we must all sincerely congratulate the noble Lord, Lord Home, on choosing this date for the discussion of his Motion. After the recent elections it is clear that the unification of Germany will take place in the fairly near future though nobody can say exactly when or how. We can, however, now discuss intelligently what the general negotiating position of the West might be in the event of unification taking place or in certain prospect of its accomplishment.

There is no doubt that Chancellor Kohl has won a considerable victory by appealing to national emotions and by suggesting that the population of Eastern Germany would be better off under a free economy than under any form of socialism. Evidently this has made a deep impression, at any rate for the moment. However, what will happen during the next eight months or so before the Western German elections nobody can say for certain.

The West Germans will have in the first place to provide an immense sum of money before any definite deal can be struck; and the Eastern Germans may well have to put up with more hardships than they can at present imagine, notably as regards unemployment and in the loss for some time at any rate of certain elementary social benefits.

In any case the West will continue negotiating with Mr. Gorbachev, supposing that he remains in power. He has probably been taken as much by surprise by recent events as we have been. He thought no doubt that unification would take much longer and that it was probable that it would result in a Socialist victory. Now he has to contemplate the reverse. It seems likely, for instance, that the Germans after the next elections will opt for the maintenance of the Western alliance and for the consequent continuing presence of at any rate some American troops in Germany. This will be something which Mr. Gorbachev will now probably have to swallow if he wants to have any agreement at all.

What therefore can the West do to make it easier for Mr. Gorbachev to accept the West's proposals? I suggest that the first thing we could offer, apart from some general reduction in troops as a result of negotiations, is the Genscher plan for some kind of demilitarised zone in Eastern Germany. This might conceivably provide for no troops at all, or at any rate only a militia. It might also be agreed that the Russians, if they so desired, should maintain a token force of troops for the time being in, say, Brandenburg. Nevertheless, I repeat that Mr. Gorbachev would have to admit that German neutrality is simply not on the agenda.

The noble Viscount, Lord Eccles, has quoted Sir Michael Howard as saying: an Alliance without the United States would be an Alliance dominated by Germany". I should like to finish the quotation from Sir Michael because I think it is intelligent. He says:

The peoples of Central Europe and the Soviet Union, rightly or wrongly, would see this as a threat. Even the West European Allies would be uneasy; not so much because of the record of Wilhelmine and Nazi Germany as because of more deep-rooted instincts about the need for a balance of power in Europe. So long as these feelings are strongly held, there will be an equally strong need for the United States to remain entangled in the Alliance, to balance German as well as Soviet power. We may regret these sentiments but they inevitably exist". The noble Lord, Lord Dacre, may not agree but we must assume that what Sir Michael writes is correct: these fears exist.

Of course if Germany, perhaps under the Socialists at the end of the year, actually opts for neutrality there is nothing that we can do about it. A dangerous situation will in my view arise and we shall have to consider our action. The situation then would be not unlike that of early 1935. Nationalism would inevitably be the order of the day and we should have to consider the possibility of alliances.

There is another proposal that the West might conceivably make. That would be for a kind of cordon sanitaire in the East embracing the states of the old Austro-Hungarian empire and Poland, plus, possibly, the Baltic states if they should ever obtain real independence. These states should declare their intention not to have any foreign troops on their territory and should perhaps indicate also that Russia would, if necessary, be consulted about their defence policy generally. In other words, the Soviet Union, supposing that it continues to exist, should have a droit de regard over their defence policy. In this way there would be established a kind of equilibrium which is in practice necessary for the preservation of peace.

But there is another matter for consideration. It is the future of the European Community. Let us suppose that Germany is completely united, with Berlin as its capital. Can we assume that this huge new power will conform to any joint policy emanating from the machine in Brussels of which it will continue officially to be a party? We must hope so. I note, however, that M. Delors seems to be having certain doubts in that respect. We must surely do our best to ensure that Germany remains a member of what will essentially in the future be a political entity of some kind.

If Germany does not accept this obligation it means that the whole idea of a supra-national organisation in the west of Europe would collapse and not form, as it should, the basis, or core, of any great association comprising other states of Europe. What is certain is that some of these states cannot for a long time form part of the core. Nor would it be desirable in view of their proximity to the Soviet Union. On the other hand, they can and should have a fruitful and ever-increasing association with the EC, at least from the economic point of view. The same applies in a different degree to the neutral states of the European Free Trade Association— that is to say, the Scandinavian states other than Denmark plus (as I would think) Austria and Switzerland.

The short point is that the European Community, if it accepts the further development of the Single European Act at the conference planned for the end of the year, will surely advance towards that new kind of political community (not an old-fashioned federation) which Europeans in all the countries concerned have always envisaged. That is perfectly consonant with NATO for as long as it has existed.

If it does so advance then it will inevitably have to have a defence policy of some kind. Its one neutral member, Ireland, will not be able to stand in the way. Probably there will be some sort of merger with the WEU. Whether the Community advances in that general direction depends now on the attitude of a newly unified Germany, as well as that of our own country. But whereas that might be formed without Britain, its formation without Germany is frankly inconceivable.

To sum up, we now have to think out a policy in the light of recent events which on the face of it could best serve our own interests and favour the establishment of a lasting peace. The guiding principle of such a plan should be the emergence of some sort of equilibrium in Europe, without which the forces of international anarchy might prevail and without which I fear any mass meeting of the CSCE Helsinki Group might get bogged down in endless discussions.

Of course, no plan however perfect is guaranteed success. A united Germany might prove to be a rogue elephant. The Soviet Union might collapse in a series of frightful civil wars. Alternatively, there might be a military regime in that country which would seek to re-establish the empire by force of arms. However, if only in an attempt to avoid such disasters, we and our European colleagues should not delay in formulating some general plan, perhaps first in the two-plus-four negotiations. I hope that the Government will tonight give a clear indication that they are aware of the dangers and the best means of averting them.

5.43 p.m.

Lord Beloff

My Lords, my noble friend Lord Dacre has demonstrated that a professional historian need not be timid. However, some of us are timid, and I do not propose in my remarks either to venture to advise Her Majesty's Government— and in any event they do not often take my advice— or to prognosticate. That which came most powerfully from the speeches of my noble friend Lord Home and the noble Lord, Lord Cledwyn, and other noble Lords has been to point out how unexpected in themselves and unexpected in the pace have been the events which we have witnessed in the past few weeks, months and couple of years.

The fact that we have been caught by surprise and that events have taken place unexpectedly should be a caution that before we decide upon policy, certainly before we decide on any major changes in policy, we must be convinced that our analysis is correct.

In that respect I have only one difference with my noble friend Lord Home; that is, in the wording of his Motion, where Eastern Europe comes before the Soviet Union. It is a fact that nothing which has happened in Eastern Europe would have happened without the initial change in stance in the Soviet Union. It is not merely this year or last year that the countries in eastern and Central Europe have discovered a dislike for their oppressors. There have been tragic and dramatic events in many of those countries— the spring in Prague and the Hungarian uprising in 1956 and others of lesser moment— but we all know that what was happening was that deeply unpopular and inefficient regimes were maintained in power by Soviet strength.

I shall come to the possible reasons for this, but once the Soviet Union in the person of Mr. Gorbachev had decided that those regimes should fall and that the Soviet Union could no longer accept the responsibility for keeping them in power, they went down like ninepins.

My noble friend Lord Dacre referred to the fact that we can now watch history taking place on television. We saw the embrace between Mr. Gorbachev and Mr. Honecker, and three days later word came from Moscow and Mr. Honecker now faces imprisonment or at least removal from the public sphere.

However, if we start, as the noble Lord, Lord Home, wished us to do, with Eastern Europe, I should like to make two general comments. In the first place, I am surprised at the degree of optimism expressed by the Minister and my noble friend Lady Elles about the current position in those countries. It is true that they have rid themselves of their oppressors, but it is not clear in many of those countries that there has been a total eradication of the Communist Party and its stranglehold on national life. We do not yet know to what extent that is happening or may happen, and clearly the extent is very different in different countries.

The Poles, whom one must congratulate, as other noble Lords have done, on the boldness of their economic initiatives, have had to take that action under the constraint of retaining a military force which is communist-led, and also under the constraint of fairly considerable participation by communists in the running of the country.

It seems to me that at the other extreme, in Romania, the revolution has not yet happened at all. The instance which the noble Baroness gave of the fact that until a week or so ago— and I do not know whether those promises have been fulfilled— there was a country with only one television station, one radio station and one newspaper, does not suggest that the old regime has given up.

Therefore, I believe that we are still likely to witness a great many more upheavals before we have a picture of the new Europe towards which we can frame policy. The noble Lord, Lord Fanshawe, referred— and I believe that so far he is the only noble Lord to refer to it— to the position in Yugoslavia. At any moment that may present us with seceding republics and with a possible attempt to suppress secession by force. Thus, there is a great deal still to worry about in the future.

Even if we assume that the revolution, if I can call it that, is complete we are not witnessing— and I think my noble friend Lord Dacre referred to this— a sudden efflorescence of western-style democracy. We are witnessing the recovery, as it were, of certain national and other characteristics which have always existed beneath the yoke of foreign domination, sometimes for decades, sometimes for centuries.

I think of Eastern and Central Europe today as one of those reservoirs in which, in a severe drought, the water recedes and suddenly drowned villages, churches and other evidences of the past occupation of the valley come to light. We see there all the traditional divisions which have marked Central and Eastern European history: the racial division between Slavs and Germans; between Magyars and Romanians. We see the religious divisions now penetrating through the possible upheavals of the Ukraine between Roman Catholicism and the orthodox church; in other parts of Europe between Catholics and Protestants.

These are parts of the scene which go back a very long way and which we must now take into account because they form part of the mass of new problems which we hope to be able to confront. Some of these apparitions are indeed deeply disturbing. Anti-Semitism— if I may take something which is naturally of very great concern to me— has clearly been revived even in countries where, thanks to the Nazis, the Jewish population is infinitesimal. There is a search for scapegoats in countries where their economic and social problems seem insurmountable.

When we consider the Soviet Union, again I find and have found for the past few years a considerable descrepancy between what I think is happening and what is usually talked about in everyday parlance. For instance, people talk about Mr. Gorbachev as though he were a sort of Father Christmas, coming along with an apple in one hand and an orange in the other; perestroika and glasnost. What in fact is the truth is that glasnost has made enormous progress, otherwise the shocks to his empire would not have occurred. Again the noble Lord, Lord Dacre, and others, and the noble Viscount, Lord Eccles, referred to the impact of communications, which has changed the world considerably even since 1918. This glasnost has made perestroika impossible. It is not possible to persuade a country, whose standards of living are not only low, but are falling— I have not found anyone who has recently been in the Soviet Union who does not confirm that— that merely tightening up the system, merely putting better managers in place, merely reshaping the ministries and reorganising the administrative side can itself alter their fate.

There is yet no evidence that the present Soviet leadership has gone beyond the scapegoat phase. They can blame Stalin. His statues can be pulled down; he can be removed from the history books and they can be rewritten. However, they still have Lenin on the pedestal behind them when they speak; they are still committed— Mr. Gorbachev made no secret of it— to what he now calls socialism rather than communism, but which, to use a neutral phrase, we can describe as a "command economy". Although we understand that he is receiving advice from his own people— foreign advice is unlikely to be welcomed there or indeed in many countries— that something far more radical is necessary, it is not at all clear that even if he takes that advice he will know how to proceed.

We have no experts in the dismantling of a command economy unless, as is likely to happen in East Germany, some Big Brother will come and do it. It is quite conceivable that with reasonable foreign assistance Poland, Hungary and Bohemia could perhaps escape from their command economies, could find in their situation— particularly perhaps in Poland which never nationalised agriculture— the embers of enterprise which could be blown into flames. However, it is highly unlikely that that can be done in the great parts of the Soviet Union, its most populated and potentially productive parts, the republics of Russia and the Ukraine. Stalin's principal legacy there was either to exterminate the peasant population or leave it with memories which make it highly reluctant to take up even the new opportunities through leasing or private ownership of land which the Soviet Government from time to time appear prepared to give them.

It is because that problem is insoluble that there will continue to be, whatever the outcome of the current crisis over the Baltic states, this attempt by the peripheral, the fringe republics to secede. They believe— they have examples before them to show it— that it is possible for small countries, if they are allowed to partake in the world flow of technology and trade, to do something which their Russian masters have been and look like being unable to do. One must therefore expect that a great deal of the energy of Mr. Gorbachev will need to continue to be directed towards what are relatively small areas of the country, a tiny fraction of the population even if you add to the Baltic states the Caucasus or Moldavia; he will have to divert effort to keep the country together. It is only if he appears to be successful in that that he will be allowed, if that is his intention, to continue a radical process of reform.

That fortifies the case made by various noble Lords for caution; for not assuming that we know enough to be able to intervene on a grand scale. There must be a degree of modesty in our aspirations. Above all, we ourselves must accept the lessons of glasnost.

A notable figure in the academic community concerned with international relations and foreign affairs remarked to me last night, "The trouble with running an institute is that there are now no experts". He meant that the whole focus of attention on Eastern Europe and the Soviet Union has been distorted for decades by the too-ready acceptance of falsified statistics, which only now are we beginning to treat at their true value.

Incidentally, I was rather surprised that the noble Baroness, Lady Elles, should have talked about the Soviet Union supporting these countries. The Soviet Union's influence on them has been almost wholly negative in an economic sense. It is these countries that have helped the Soviet Union. That is why these claims that are now made upon the Lithuanians seem— and must seem to anyone who looks seriously at the situation— very far-fetched. One has only to see the difference between the three Baltic republics and their near neighbour— in the case of Estonia, their linguistic equivalent the Finns— to see what happens if, either by luck or valour, one escapes from Soviet domination.

We ourselves therefore must get used to glasnost; to looking the facts in the face. The most dangerous aspect of all would be if we were to comfort ourselves with the idea that Eastern Europe, Central Europe and the Soviet Union are back on course to a better and a happier world. We may hope for it; we may pray for it, but we must not assume it.

6 p.m.

Lord Hankey

My Lords, we usually have a fascinating contribution from the noble Lord, Lord Beloff, and his speech on this occasion was certainly no exception. I agree with almost everything that he said. In spite of all the difficulties, I hope that we shall maintain altogether better relations with the Soviet Union under its new regime. The future peace of the world will probably, in the end, depend on that. We have begun well.

I agree with the noble Lord, Lord Beloff, that President Gorbachev has a formidable task ahead of him. I greatly hope that he will preserve such liberal and democratic principles as are contained in perestroika, but he will have major difficulties with growing nationalism in the USSR's constituent republics.

We have to resist any temptation to mess about in the internal affairs of Russia as Stalin messed about in ours. The overseas services of the BBC and, for that matter, the Voice of America, should be very careful not to appear to encourage breakaway tendencies and to show understanding for the position of both sides. It is a truly difficult situation. If we want really good relations with the new Russia, we have to be wise and restrained about Russia's internal affairs, though we should not be blind to what is going on and under no circumstances should we in any way forget our own democratic principles.

Changes take time and Mr. Gorbachev is going to need lots of that. A great deal will depend on Mr. Gorbachev's progress with the Soviet economy. He cannot easily change from a command economy to a market economy with an effective price mechanism while all the officials are trained in Marxism/Leninism. I suppose that is one reason why the Soviet Government have amended Article 6 of the constitution to remove the Communist Party's monopoly of power. Perhaps the local elections that have been taking place will also bring in some changes and introduce people who are less dyed-in-the-wool.

The need for a new economic system is, however, a vast problem in Russia and if Mr. Gorbachev cannot solve it I suppose there is a real danger of economic confusion or even collapse. If the Soviet economy fails to get food and goods on to the shelves in the shops and into the housewives' kitchens I doubt whether Mr. Gorbachev and perestroika can survive for long. But what would follow; another authoritarian regime? There are great uncertainties, and a number of your Lordships have said in this debate that we must watch the situation carefully and be prepared for all sorts of things to happen. Probably nothing good would come out of that. However, we must not forget the transcendent patriotism of the Russian people, which is a basic feature of their character.

To conclude my remarks about Russia, I am convinced that the future peace of the world depends on all of us in the West continuing to foster a new and altogether more friendly helpful relationship with Russia now that Stalinism is dead. It will require great restraint and continual wisdom. We have begun very well, in my opinion, and whatever happens, we should persist. For one thing, both the disarmament problem and the situation in Eastern Europe require friendly relations with the new regime in Russia.

That brings me to Eastern Europe. The economies of those countries are in a terrible mess, but the problem of changing from a command economy to a market economy is probably slightly less than exists in Russia. There must still be many people who remember conditions before 1939. I have the indelible impression from working in and with these countries that a great many people took Marxist/Leninist principles with a healthy dose of salt.

The basic regional economic problem is that trade is mostly on a bilateral basis. They have many restrictive quotas, and other measures, and they have no convertible currencies. After the war we too had this problem in Western Europe but we solved it with resounding success. The mechanism for doing so is still in place. The OECD has all the know-how, with expert committees on monetary and economic policies, on trade aspects, social aspects, agriculture, education and science etc. The OECD Economic Committee goes in detail, with sympathy and understanding, into the performance of every member country approximately once every two years. It gives invaluable and penetrating advice.

I believe, as the noble Baroness, Lady Elles, said, that that is what the Eastern European countries need. I urge seriously that they become members or associate members of the OECD and that the Economic Committee, in particular, should take them in hand. It would certainly give them many new ideas and much practical help.

I also urge that all members of the OECD and the European Community should only distribute our aid funds for Eastern Europe in proportion as these countries reform their economies, their currencies and their trade relationships. That is what we did in the 1950s in Western Europe. It took most of 10 years to set up the area economically and in my opinion it will take a little longer in Eastern Europe, but I have no doubt that that is the best way to do it.

Another reason for using OECD is that it includes among its members Scandinavia as well as the United States, Canada, Australia, New Zealand and Japan. We need to encourage the interest, advice and help of the whole developed world, especially North America, in what is going on in this crucial area. The noble Viscount, Lord Eccles, made an extremely good point about the importance of keeping American interest. We must not forget that the League of Nations failed because it was too restricted and because the Americans were not in it.

I now offer a serious warning, having worked in and with these countries for years. They tend to hate each other. The disgraceful treatment of the Hungarian minority in Romania which sparked the Romanian revolution is typical. The disturbances in Kosovo with the Albanian minority are not much better. We must remember that the First World War was sparked by the murder of an Austrian archduke in Serbia and that the Second World War began in Danzig, now Gdansk.

Democratic peoples and leaders may not always be much wiser than dictators, and now that there is no Pax Sovietica across the area of Eastern Europe we must have a really good and powerful organisation to keep everything in good order and arrange the settlement of disputes. The League of Nations was constantly occupied with disputes in the area. At every meeting there was at least one, and often two or three disputes of this sort. I seriously wonder whether a development of the Helsinki Accord on Security and Co-operation in Europe could be arranged. The noble Lord, Lord Callaghan, made a very strong point in that regard on 17th January and several speakers in this debate have also mentioned the point.

We must beware of sparks in Eastern Europe. Perhaps the Helsinki Accord could be developed. I believe the noble Lord, Lord Brabazon of Tara, said that the Government were examining that possibility. I hope that they will go on with the idea.

Finally, I come to Germany's relationship with all this. I suppose that Germany will definitely be reunited in the next 12 months. Obviously, there must be an agreed solution for the future of the Soviet troops in Eastern Germany. That is a real task for diplomacy. I wish to repeat insistently, as many of your Lordships have done, that Germany must remain in NATO. The Germans want it; the Eastern Europeans want it; we want it, and we must not accept any argument about it.

At the same time I hope that good direct relationships can be promoted between NATO and what is left of the Soviet pact. I suppose that is only the Soviet Union. It is essential that in future both sides should come to have some real confidence in each other. We have made a good beginning and we are moving in that direction. Dr. Woerner, the Secretary General of NATO, has excellent ideas on all this. I was very impressed with him. It is essential in NATO matters, if we are to have good relations with Russia, that both sides should adopt a stance which is transparently defensive and in which both sides can have confidence. Whatever happens at the next election here, in no circumstances should we go for any unilateral disarmament. That would be a most disturbing factor in the preservation of peace.

Especially, we must not be bamboozled about what is happening. We must have a system of control of disarmament measures in which we can have proper confidence. No one can foresee what is going to happen in Russia or who will take the lead if perestroika and Mr. Gorbachev fail. There might be a national leader looking for an adventure with whipped up patriotism to solve internal problems. We should make Europe so strong, so cohesive, so well-organised in defence and other matters, that no one will ever be tempted to do that, but still preserve good relations with Russia.

Please do not be under any illusion at all but that we need to have the new Germany in a strong, politically-conscious and well-organised European community. It is really essential that Britain should be an active participant on the inside network. We have made great errors in not working more actively to promote this vital new development. Now is the time to do that while everything is in a state of flux.

My noble friend Lord Greenhill, in a transcendently good speech, suggested that we should take our time about the matter and not hurry. I think we have to do something before the cement hardens. Once that has happened, and the situation is no longer in a state of flux, we shall probably not get further forward. It is essential that Britain should be an active participant on the inside network.

All through the centuries British policy has aimed to prevent any one power controlling all the coasts opposite our shores. However, the countries of Europe are now consolidating and it is vital for all of us and for world peace to keep the new, reunited and democratic Germany in a good, profitable and friendly framework. I am sure that we cannot accept a strongly centralised system in the new Europe. It would cause prodigious aggravation. I do not believe that the Germans can accept it either. We shall still have to decide a great number of things for ourselves.

On 17th January I said in this House that I seriously thought that, as a long term objective, we should all start working towards a confederal government for Europe. I know that that is a horrifying idea to a lot of people, but it is time that we began to think seriously ahead. The member countries would assign to the confederal government only the powers that they want it to exercise and they would keep the rest for themselves. There would have to be a treaty with a written constitution. I am as conscious as any noble Lord of the vast difficulty of doing this. Obviously, one can "suggest a problem for every solution", as my French colleague once said at OECD.

After our terrible experiences in Europe over the past 150 years, we would be very wrong to fail now to pull Europe together. There is an old and wise American political statement, which is: If you can't beat them, join them".

6.15 p.m.

Lord Belhaven and Stenton

My Lords, like other noble Lords who have spoken, I wish to thank my noble friend Lord Home for initiating the debate and for allowing us to speak on this very wide subject. My only intention is to draw your Lordships' attention to the situation of Poland. In this respect I have to declare an interest, as I have done before. I do not know how many times I have to do so. My wife is Polish. Beyond that, possibly the whole House and the whole nation should declare an interest in the matter of Poland.

I do not believe that any country in the world suffered more in the Second World War than Poland. She entered 1945 with her capital in ruins and with more than half of the population dead, the other half having had to flee. Nearly all the major cities were also in ruins. Those of us who are old enough— probably most noble Lords here this evening— remember the gallantry of the Polish servicemen who came here and fought on our side. Sometimes perhaps we forget that they were fighting for their own country as well as the general cause.

The price that Poland paid for steadfastness in the war was the loss of 52 per cent. of her national territory and the suppression by her major allies of her legal government; so, in 1945, there was no one to speak for Poland except the carpetbaggers and bandits installed in office by Stalin. The activities of the successors of the Stalinist Government are responsible for the plight of Poland today— hyperinflation, overwhelming environmental pollution, bad roads, hopeless telephones (as I have experienced to my distress) and other factors too numerous to mention.

It must be almost unprecedented in history for a country on the winning side in a major war to be so penalised. As compensation for the loss of 52 per cent. of her territory, Poland was given a large part of East Prussia and the former German territories east of the Oder-Neisse line. It is appropriate to remind your Lordships that Poland had no say in the readjustment of her frontiers. They were imposed on her. Indeed, at the end of the war, she was treated in almost every way as a defeated nation: her territories forfeited, her frontiers rearranged and, worse than all that, the gallant men and women who fought in the Polish Home Army were rounded up. Some were murdered and some, like my father-in-law, survived imprisonment and persecution to try to make a living in a country with a system which they hardly recognised as their own.

On top of that, many, if not most, of the servicemen who had fought side by side with us in the West, in the Battle of Britain, at Tobruk, Monte Cassino and in innumerable other battles, were unable to go home for fear of imprisonment or judicial murder. What a bitter shame and injustice all this was!

I am very happy to take note of the fact that Her Majesty's Government are standing firm in their support of the Oder-Neisse line. The least that the victorious powers can do is to guarantee absolutely that this frontier is not changed. It has been made clear to the united Germany, should it come about, that it will not be permitted to fish in those waters. I do not believe that any of us wish anything but happiness and prosperity to the new Germany. However, it should be made quite clear, particularly in view of the carryings-on of Chancellor Kohl in the past few weeks, that, no matter what the claims and counter-claims may be between Germany and Poland over Pomerania, Silesia, East Prussia and the rest, the loss of territory is the price which Germany must pay for the hell she has let loose on Europe twice in this century. This also goes for the Sudetenland, Alsace Lorraine and the rest. I believe that these questions ought never to be re-opened. I have seen them being re-opened on our television screens very recently. Germany is perfectly able to prosper within her present frontiers and in fact is doing a good deal better than most of her neighbours.

I shall not go into the various ways in which we as a nation can help Poland in her present predicament. That has been more amply covered by noble Lords who have already spoken. However, for us, Poland should be special case. She proved herself to be the staunchest of allies in the war and many in this country have the closest ties of friendship and family with Polish people. Through the terrible period between the betrayal of Yalta and today the Polish nation has never waivered in its dedication to Christianity and freedom. The Solidarity movement was a precursor and standard bearer of the great liberation which has now swept over the whole of Eastern Europe including Russia itself. We and all free people owe Poland an incalculable debt. This time, my Lords, I believe we ought to pay it.

6.21 p.m.

Lord Parry

My Lords, it is probably 15 years since I was in Hungary as part of a parliamentary delegation. Since then I have been to Czechoslovakia, East Germany and Yugoslavia. But I know very little of any of those countries except as a tourist in what were for me underprivileged lands.

It is a fact that this afternoon the whole lives of most of us in your Lordships' House have been under review. The debate has taken us from 1945 through to the present day. The moment in 1945 when the war was over, the Cold War was beginning, the Iron Curtain was sliding down, the Bamboo Curtain was going up and the foundations of the Berlin Wall were being laid in the divided capital of Germany, was the moment when most of us began to take a part in public life in Britain. Many much younger who are present will know it only from their history books. Some present in the House were already recognised figures in the public life of Britain. It is a miracle that they are here tonight.

It is a delight to pay tribute to the noble Lord, Lord Home, who launched this debate, and to my noble friend Lord Cledwyn who followed him, for having set the trend of it and for giving us what has been, despite our different politics, an almost ecumenical approach to the revolution in human history now taking place in Europe.

The Hungarians, who have a wry sense of humour, taught me a proverb. There was, they said, only one difference between the optimist and the pessimist: the pessimist was better informed. We have had a well-informed debate which has vied between optimism and pessimism and yet has sketched the true facts of what is happening in the lives of people on the other side of the world. It is quite incredible to me that at the time when all those divisive, difficult and so saddening things were happening immediately after the world war, the then Foreign Secretary of Great Britain, Ernest Bevin, was still able to say that his foreign policy was to look forward to the day when he could go down to his local railway station and buy a ticket to anywhere in the world.

Because there is an excellent Library in your Lordships' House I am able to quote what Ernest Bevin said in his own inimitable style in an interview in the Spectator on 20th April 1951. He said: My [foreign] policy is to be able to take a ticket at Victoria Station and go anywhere I damn well please". It was typical of Ernie Bevin that he should use a truculent expression to underline something deeply fundamental which has been understated, I believe accidentally, in your Lordships' debate.

For many people freedom is the freedom of travel. The only reason why the walls went up in the first place and the curtains came down in the first place is that people wished to travel. Human beings are the most restless of the creatures of this earth. They are compelled to climb the highest mountains; they want to go down the deepest caves; they want to swim the rivers and sail the seas; and they want to go to other people's lands to see what happens there. When systems limit that fundamental drive of human nature they are at the same time defeating themselves and frustrating one of the greatest powers in human life itself. It is a fact that the wall did not frustrate the wish of the people to travel. It only increased it. When the wall came down, it came down for the same reason that it went up. The attempt by Erich Honecker to hold in the people who were leaving his disliked system was doomed to failure.

On 12th May 1949 there was a debate in another place— what I always call the Commons— on the setting up of NATO. I do not think that any noble Lord present actually spoke in the debate. Naturally those who did are probably long dead. There may be some who voted or abstained from voting on that issue. The setting up of NATO is fundamental to what we have been discussing today. It is a matter for human optimism that the people who were associated with that are able to look out on the world in the 1990s and know that their worst fears were never realised and that some of their brightest hopes may be attainable.

I pay tribute to all those who have spoken in the debate. Some noble Lords are inevitably still stuck in the vocabulary of the earlier stages of the Cold War. The moving speech of the noble Lord, Lord Belhaven and Stenton, is as much appreciated as any other speech this afternoon. My noble friend Lord Kagan spoke as one who was behind the barbed wire, was in the prison camp and suffered in his youth. We listened with even greater attention to what was a remarkable, short speech.

There are, as noble Lords have pointed out, question marks over this whole issue. This very day, with the first democratic elections of their lifetimes out of the way, with the euphoria naturally dying, the people of East Germany may well be asking themselves how much freedom have they won. If one of the freedoms they were looking for is the freedom to travel, they have heard their potential Chancellor appealing to East Germans not to travel but to stay where they are.

The de facto coalition between West Germany and East Germany could take place in a fortnight. It may well take a year to realise all the changes that will follow from it, but within a fortnight we could have an effective coalition of interests between East and West Germany. Yet today, a few days after the election that won them their freedom, Chancellor Helmut Kohl is appealing to East Germans not to travel. Their own leader, Herr de Maiziere, who has been elected as Prime Minister, is saying from his side of the fence that the people should stay and should not bleed their country to death by leaving. The death of any council, of any community or of any country comes when its best people move away because they are disillusioned.

As some noble Lords have said, it is true that Marxism and Leninism, and Marx and Lenin themselves, have long been discounted even in the countries that were still running communist systems. But these people who have had their politics forged on the anvil of world anger, and at the same time by the ideologies of Marx and Engels and others, know that Hegel, who was one of the people from whom Marx learnt some of his disciplines, actually traced the decline of the society which they see happening at this time. He said that there were traceable steps, but that first of all there was disillusion of the people in the system under which they lived. Following that disillusion there came inevitably decay and out of decay there came collapse. Then— and this is the significant thing that no one has mentioned in the debate— out of the collapse there would always emerge a new ideal which was always the antithesis of the ideal that it replaced. Therefore we have seen once again on the face of history the repetition of those Hegelian steps.

In the few moments I have left perhaps I may sketch in another aspect which has been totally omitted from the debate. Why, I wonder, did Mikhail Gorbachev, in power in what is still one of the great powers of the world, suddenly find himself yearning for his European home nostalgically? I shall tell your Lordships why. He did so for the same reason that the great British empire began to break up after the war. In Burma, in Ceylon and in the countries of the Far East the great British Empire realised that it could not hold down any longer people in areas and parts of the world who wished to be free and make their own determination. Therefore we retracted our empire and today we have achieved the role that we have in the world. It is one of which we can be proud. We need not apologise for much of our history. But when Mikhail Gorbachev found himself in Afghanistan which was supported by money and funds and fighting forces from Pakistan and when he found himself faced with the Mujahideen peasant who was doing incredibly well againt modern weapons, he and his armies recoiled. However, let us remember that his government is still in place. I heard people say in this House that the Government of Afghanistan would fall within a week, and good riddance to it. But it is still there.

All along the Eastern Soviets Mikhail Gorbachev has a Moslem population; indeed, in some cases 75 per cent. of the people are Moslem. They are not turning towards their European home; they are turning towards their spiritual home and to their Moslem beliefs. Moreover, many of them are Shi'ite Moslems. Mikhail Gorbachev realised that unless he retracted and shook off some of the responsibilities and expenses of his empire, he would find himself reduced to struggling against forces that were not containable. It is, however, too late to go into the details of the situation.

I must say that I am honoured to be a part of this debate. I believe that we can be optimistic. But we should not discount the fact that there is a third dimension beyond the Urals and that we could see a whole new empire; for example, a Shi'ite Moslem or a Moslem empire stretching from Pakistan to the Mediterranean and sitting on many of the oil reserves of the word. This is a point I make in closing because I was moved, as was the House, by the perorations of my noble friend Lord Cledwyn in his remarkable speech. He talked of the dream that sustained people during the world war. I remember that it was Bernard Shaw who wrote some words that Robert Kennedy purloined— some young men do such things— without attribution. He ended the book of his ambitions and hopes for the world with these words: Some men speak of things that are and say why: I dream of things that never were and ask why not? That is also my attitude.

6.34 p.m.

Baroness Strange

My Lords, I, too, am grateful to my noble friend Lord Home for initiating this most timely debate. I am also most grateful to him and to the noble Lord, Lord Cledwyn, for their very moving speeches. Because I lost my dog last weekend, and found her again after two days, I find myself thinking very much in terms of dogs. That is why, rising to speak in such company, I feel rather like a dachshund getting up among a pride of great danes. But I know from experience about your Lordships' kindness and tolerance and that emboldens me.

We are not only living in interesting times, we are also living in a European kaleidoscope at a moment when the whole pattern is changing. From the earliest Bronze Age with its settlements of long-headed fair Nordic and dark Mediterranean types, and the round-headed Alpine, who were largely farmers and peasants, frequent disruptions occurred when the wild Indo-Aryan warriors with their sharp, vertical swords disrupted the peaceful peasant cycles of spring and harvest, planting and reaping.

Europe as we first know it came with the Roman Empire, based around Rome and enveloping the shores of the Mediterranean, although it also included Britain— at least as far as the Antonine Wall. Anyone who was not Roman, or possibly Greek, was a barbarian. But suddenly, with one of the periodic disruptions of the kaleidoscope, the Huns swept down from Mongolia into Dacia, pushing the Visigoths into Italy, and in 410 AD Alaric and the Visigoths sacked Rome. The pattern of Europe had changed, now peopled by Visigoths in Spain and South-Western France, Franks in the North of France, Burgundians in the middle, and all of Austria and Italy filled with Ostrogoths. With the collapse of Roman society over there the Britons fled into Wales and Cornwall and the Angles, Saxons and Jutes descended upon England.

The next great kaleidoscope change was under Charlemagne, Emperor of the Franks, who extended his empire west into Saxony, Bohemia and Bavaria and south into Lombardy in Northern Italy. At his death in 843 AD his vast empire split vertically into three among his three sons— an early French partagement. Europe has once more dissolved into a kaleidoscope of small pieces. This was when it coalesced into the Holy Roman Empire under Otto of Saxony who, with his father, had driven back the wild Magyars. Marching to Rome in 962 AD he was made Holy Roman Emperor, with an empire, which although with changing amoeba-like frontiers, remained a constant force for the next 900 years.

By 1360 Europe was much more as we know it now, with Russia and the two large kingdoms of Lithuania and Hungary in the East, a smaller Poland, Portugal, Castille and Aragon in the Iberian Peninsula, the whole of Aquitaine owned by England, and the Turkish Ottoman Empire creeping up into Bulgaria and Serbia in the South-East. Finland was part of Sweden, but Norway and Denmark very much retained their geographical entities as they are today; as, indeed, did Switzerland.

The Turks were driven back from the walls of Vienna— when the inhabitants celebrated by eating croissants, the Turkish crescent moon symbol— the Moors were driven out of Spain and Europe settled itself into a more comfortable pattern. France emerged as a whole nation; Poland grew larger until in the 18th century it was partitioned between Russia, Prussia and Austria. Napoleon created the French Empire, parcelling out kingdoms to his friends and noble kinsmen.

With the Congress of Vienna in 1815 Europe again changed. Italy united. We in Britain did too, and although we lost our continental possessions— except for the Channel Islands— we expanded gradually overseas into the British Empire. France and Germany, Spain and Portugal and Belgium and Holland all stretched outwards beyond Europe to found empires of their own. The Holy Roman Empire collapsed. Frederick the Great and later Bismarck reunited Germany under the eagle of Prussia, and this eventually led to the 1914–1918 War and another kaleidoscope change.

In 1918 parts of Germany and Austria went to Poland, as well as parts of Russia. Estonia, Latvia and Lithuania were established or re-established out of Russia. Parts of Austria fell to Romania. Yugoslavia and Czechoslovakia were created out of Serbia and Croatia, and Bohemia and Moravia. Thirty years later, with the rise of Hitler and the Nazis, it was all up for grabs again by the Germans. After 1945 the Iron Curtain of communism clanged down over the eastern half of Europe.

A new Europe is once again emerging: a Europe in which there are three factors which need careful consideration. First, there is the outbreak of glasnost and perestroika in the Soviet Union, and from this all the other changes which have arisen. Secondly, there is the break-up of communism in the Eastern European nations and their move towards democracy; and, thirdly, there is the unification of Germany. The kaleidoscope is still settling, the new pattern still emerging. We are all observers of this change, but today, as many noble Lords have mentioned communications are almost instant, distance no longer counts. You can see the breakdown of the Berlin Wall on your television as it actually happens.

We in Britain must be ready wholeheartedly to help the emerging countries of Eastern Europe to achieve democracy, to stake our own place in the kaleidoscope. We must, with cautious friendship, welcome the re-emergence of Germany. And we must continue our friendly dialogue with the Soviet Union, which is emerging from a chrysalis, and like all emergent imagos is at its most vulnerable state. So we must extend our friendship and our help without ever relaxing our vigilance over our own defences.

The new emergent Europe is, as the Soviet delegate Mr. Medvedev said here a few weeks ago, our common home. We must not limit our conception to a smaller Europe, only the 12 based on Brussels, but to a larger Europe perhaps even including America, as the noble Viscount, Lord Eccles, and my noble kinsman and clan chief suggested. Neither must we let ourselves lie open to any sudden and unexpected chill winds which might blow from the East. We have much to be proud of in the British Empire. We have also much to give to the new Europe.

6.42 p.m.

Lord Bonham-Carter

My Lords, I too, like other noble Lords, should like to say how grateful we are to the noble Lord, Lord Home of the Hirsel, for initiating this debate. I find myself in some difficulty in following the noble Baroness in her speech, as I last read Bryce's History of the Holy Roman Empire when I was 14. It would have been more appropriate if the noble Lord, Lord Dacre, had followed her rather than me. But I, like other noble Lords, in the past few weeks and years have been overwhelmed, bemused, almost drowned by the cataract of events, one succeeding the other, in the past two years, the past two weeks, the most recent of which would have satisfied one's hunger for news for many months in the past.

To mention but four events: the Communist Party's monopoly of power in Russia having been abandoned; the increased powers granted to the President of Russia, Mr. Gorbachev; the talks about Lithuanian independence between Russia and Lithuania; and finally, and by no means least, the German elections. Each of those events is in its way momentous. Each would justify a debate in its own right. Therefore it is not surprising that the debate we have had today in your Lordships' House has covered a wide field and opened up a large number of different options.

I should like to say that I found myself in some agreement with many of the pessimistic prognostications made by the noble Lord, Lord Beloff, when he spoke earlier this evening. If one looks at the prospects facing Poland today one sees that they are genuinely daunting. Here you have a country of 35 million people, rich potentially in agriculture but now importing food; rich potentially in raw materials but nonetheless with probably the lowest standard of living in Central Europe.

Here you have a government based on a trade union movement which is asking its followers, and the people who elected it in a curious way, to accept inflation that is running at 20 per cent. a month, unemployment that will probably rise to from half a million to 1 million in the next month or two according to your adviser, price rises of 20 per cent.

in January, and a real drop in the standard of living. The rigours that the government are asking people to put up with in the expectation of better things to come are such that most electorates would not entertain them. There will be local elections in Poland in June, and it will be interesting to see how they respond. If they respond favourably it will be an enormous tribute to their determination, their courage, and their patriotism.

If on the other hand you look at Romania you have a situation which, if the information I receive is correct, is far more grisly and worrying. Romania has a tradition, and it is a tradition of bad and corrupt government. It would be surprising therefore if at one stride it leapt into democratic reform successfully.

I am informed— and I do not know whether I am right or wrong, but it is on reasonably good authority— that the elections which are about to take place in May should be monitored by some external, neutral body; that intimidation is rife; that the opposition parties are given 10 minutes a week each on television; that all party leaflets, information and so on has to be printed by the central government press; and that when— and this I cannot vouch for, it is simply what I am told— a printing press was given to one of those parties, they were told that they had to hand it over to the National Council for Salvation so that it could be shared "equally" among the parties.

It seems to me that this is a serious situation, and I suspect that it is not an uncommon situation in Eastern Europe. In discussing what we are discussing today, we need to distinguish not only between the USSR, which is a totally different situation from that in Eastern and Central Europe, but between Central Europe— by which I mean Poland, Hungary and Czechoslovakia; basically the old Austro-Hungarian empire, or parts of it— and Eastern Europe which is, as the noble Lord, Lord Beloff, said, mainly orthodox in faith and which has a totally different history and a largely different structure.

Nonetheless, though one may look with scepticism and some degree of gloom at the prospects that face people in that part of the world, one has to try to look at the situation with the optimism that has informed some of the speeches we have heard tonight, and not least the speech of the noble Lord, Lord Home. Just as it seems to me that in World War Two, when we reached the stage that Mr. Churchill called 'The end of the beginning", people started to ask for war aims, so now it seems to me, amid the welter of events and revolutions that we have witnessed, there is a need for what President Bush rather charmingly called "that vision thing".

In thinking about "that vision thing" we can be powerfully assisted by two lectures recently given in London; one that has been extensively quoted tonight Sir Michael Howard's Alastair Buchan Memorial Lecture, and also Sir Ralph Dahrendorf's Sir Brandon Rhys Williams lecture. I shall be referring to them in the course of what I have to say. I start, as Sir Michael Howard starts, from the assumption I think shared by most people but if

one took seriously some of the answers we get to questions on defence in this House from Her Majesty's Government, one would think that they did not share— in Sir Michael Howard's words: that Gorbachev has already achieved his historic task of setting on foot a transformation of the Soviet state that is both open-ended and irreversible. If you start from that assumption you can try and think of a more optimistic scenario than that outlined by the noble Lord, Lord Beloff.

Although it is true that the USSR remains a nuclear superpower, I think that the word "superpower" cannot be applied to her in any other respect, neither economically nor politically. In saying that, and making that assumption, I am not denying that the changes that we are witnessing carry with them dangers; that, as it were, melting snow can cause avalanches; that the new freedoms won in Central and Eastern Europe may lead to outbursts of nationalism and to the revival of ancient disputes.

Nonetheless we have an opportunity that is a rare and extraordinary one, and that is to take a part in remaking Europe. That is what the "vision thing" is about. If one looks at the kind of vision that one has of Europe, or what the noble Lord, Lord Dacre, described as "the Europe I should like to see", it is a vision of a single security system embracing the whole of Europe from the Atlantic to the USSR borders. It is a Europe in which the existing military pacts are dissolved. It is an integration of Europe, either within or in association with the European Community, of EFTA with which it is already in negotiations; and of a Central Europe consisting of those countries which President Havel, who is here this week, suggested should associate more closely with each other— Poland, Hungary and Czechoslovakia. That would provide a unit with which the European Community could negotiate as it developed.

However, we must remember, as a number of noble Lords have said, the legitimate anxieties of Russia. In order to assuage and allay these, Sir Michael, in his lecture, as was mentioned by my noble friend Lord Gladwyn, suggested that one means of so doing would be to have a demilitarised zone stretching from Finland to Yugoslavia in which no foreign troops and a minimum of national troops were allowed to be stationed.

It may well be easy to draw pictures of that kind. What is much more difficult— and what we must address ourselves to— is how we get there. In this post-Communist world, the two great dangers that face us, it seems to me, are fundamentalism on the one hand, and nationalism on the other. Within Europe it seems that the latter is the most dangerous. One manifestation of nationalism against which I think we need to guard is a narrow defence of national sovereignty. That is a term which means less and less in economic, environmental or military affairs in the world in which we live and must survive. The concept of national sovereignty is an obstacle to building the kind of Europe which I have described and which, if clung to by British governments, will minimise our influence in the councils of Europe and of the world.

Hence I entirely agree with what my noble friend Lord Thomson of Monifieth and the noble Baroness Lady Elles said, in emphasising the importance at this moment of deepening the political and economic institutions of the European Community. The events in Germany, the prospect of German unification in the immediate future make that more not less important.

As the noble Lord, Lord Cledwyn, said, it was in the light of this prospect that the European Community was invented. It was in the light of that prospect that the United Kingdom was asked to take part in the original talks at Messina. Now that it is happening, it is all the more important that we cease to be what Sir Leon Brittan has described as a "semi-detached member" and become an active and fully participating member.

As Sir Ralf Dahrendorf said in his lecture, we can either be bystanders, in which case we shall probably become the satellite of some great power, or we can become active participants in the whole process. In such circumstances with us fully involved in a Europe which is growing politically and economically, I do not recognise, any more than my noble friend Lord Thomson, the threat posed by a united Germany. I am much encouraged to be reinforced in this view by the words of the noble Lord, Lord Dacre.

Of course a neutral Germany, a kind of shifting cargo in the centre of Europe, would pose a real danger. But a Germany within the European Community and within NATO does not alarm me. Nor, it appears, does it alarm any members of the Warsaw Treaty Organisation, with the exception of the USSR. It is our duty to try to persuade the USSR that a Germany within NATO and within the European Community is the safest option. That does not mean that in the future NATO will remain the same or remain unchanged. The alliance will remain just as the Atlantic alliance must remain, but the balance within the alliance will change. As it has changed in the past, so it will change in the future.

It is here that I felt in some disagreement with the emphasis of the speeches of the noble Viscount, Lord Eccles, and the noble Earl, Lord Perth, with their reiterated emphasis on the relationship with the United States of America. The "special relationship"— if that is what they were referring to— seems to me to be a thing of the past. Its death seems to me to have been pronounced at Suez. If the United States has a special relationship with any European power today, it is quite clearly with Germany. It is said that President Bush refers not to the "German problem", but to the "British problem". Moreover, the United States has urged in the past and still today urges this country to adopt a more forward position within the European Community. The two relationships— that is our relationship within the Community and our relationship with the United States— are not alternatives, they are complementary.

At the same time we must expect further troop withdrawals by the United States from this Continent. We must expect the United States to concentrate rather more on the Pacific rim than

it has hitherto and rather less on the European dimension. Hence I agree with Sir Michael Howard when in his lecture he said that:

"the balance within the Alliance must now shift. Under the new circumstances the European members of the Atlantic Community can and must make proportionately a far larger contribution to their own security. The role of the United States should in future be supportive rather than dominant. NATO must not be seen in the future, as it has been too often seen in the past, as a mere extension of American power".

Those sentiments seem to me well judged.

Finally, every one of your Lordships who has spoken in the debate has referred to the fluidity and unpredictability of the situation in which we live. Every one of them has pointed out quite rightly that while this instability carries the prospect of development in a positive way, it also carries with it dangers. I believe that in this Europe of flux, change, opportunity and danger, a European Community in which we play a full part can provide in this changing situation a zone of stability.

6.57 p.m.

Lord Graham of Edmonton

My Lords, I wish to begin by echoing the words of my noble friend Lord Cledwyn and joining in the grateful thanks from these Benches for the generous tributes that were paid to our dear departed colleague Michael Stewart. It is typical of the debate and of the generosity and warmth of the House to a colleague who served the House and the nation well.

Not for the first, nor I hope for the last time, the House is in the debt of the noble Lord, Lord Home of the Hirsel, who has led us in a debate of extraordinary fascination and remarkable relevance as well as of terrifying import and consequence. Although many speakers have striven to stress that the people of Eastern Europe are free and must be allowed to fashion their own destinies, I am of the school which asserts that that criterion is fine so far as it goes. However, many countries and millions of people outside Eastern Europe and Russia can claim, as I do, that it is not an island but part of the mainland.

The overwhelming sense that I gather from our debate, during which all noble Lords made balanced speeches, is that Britain cannot and must not remain on the edge or the sidelines. The responses made by the Government to a range of challenges posed by swiftly changing conditions, notably posed as questions by my noble friend Lord Cledwyn, will mark the Government out as fit to govern and worthy to lead.

I remind the Government that there are other countries and leaders who will be eager to play a major role. We in this House should urge and support the Government to be bold. Our chance may not come again. I pay generous tribute to the speeches that we have heard about Poland. But in addition to the events that took place in Poland in 1989, there are now reformist governments in Hungary and Bulgaria, and mass public demonstrations against the GDR Communist Party resulting in the dismantling of the most potent symbol of the cold war, the Berlin Wall. We have witnessed the significant free elections which took place in East Germany last week. There has also been the election

of a former dissident playwright as the non-Communist President of Czechoslovakia. Further, there has been the revolution in Romania. Throughout this turbulent period in Europe, there has been a watershed of equal proportions in domestic Soviet politics, pioneered by Mikhail Gorbachev and his perestroika beliefs.

My noble friend Lord Cledwyn has added his experience and wisdom to that of many others in this debate. I certainly support what he said in regard to the yearnings of millions of people in Russia and in Eastern Europe. They yearn for democratic government, practical policies and peace and security. My noble friend used a phrase which I believe is very apposite. He said that the people of Eastern Europe yearned for politicians with guts and vision. That is an aspect of the debate tonight.

The noble Lord, Lord Thomson of Monifieth, said that this is a time of hope and of uncertainty. I agree with that. The noble Lord, Lord Brabazon, in his impressive speech told us we were in a period when events were settling down. He also gave the House news of a range of initiatives and events. We particularly welcome the news he gave us of the visit to Russia both of the Foreign Secretary and of the Prime Minister. He told us that there were opportunities in the swiftly changing field of security and defence. We must look forward to further agreements that can be made in that field. I look forward to hearing the noble Lord, Lord Belstead, tell us a little more about the Government's thinking on the conference that will be held in the autumn.

We must remind ourselves that the USSR is divesting itself of its empire in the West as completely as the British divested themselves, 40 years ago, of their empire in the East. Now the divided halves of the European family can come together once more and remain together. The remaking of Europe is at last possible. That is the task to which all our minds must now be turned. Our first task, in my view, must be to reabsorb the peoples of Central Europe into our cultural and economic community where they properly belong, and to reknit the ties between London, Paris, Rome, Munich, Leipzig, Warsaw, Prague and Budapest. If those people are reabsorbed, they may join our security alliance too. My noble friend Lord Cledwyn posed a number of questions regarding how a united Germany will fit into, or not be permitted to fit into, NATO or any other security alliance. That matter will be raised, if not settled, at the conference on security and co-operation in Europe which will be held in Helsinki.

I was particularly attracted to some of the opinions of the noble Lord, Lord Beloff. It may be far too easy an assumption on the part of the East Germans, the Poles and the Czechs that elections will automatically ease the path of economic reform. The ballot box may confer democratic authority on more would-be reformers, even in Gorbachev's Soviet Union, but elected governments are not immune from economic pain. When prices are freed, suppressed inflation breaks through, as has happened in Poland. When producer subsidies are cut, people lose jobs. When consumer subsidies go, living costs rise. When exchange rates are liberalised,

the buying power of overvalued currencies falls. Eastern Europe needs all this and more, including such delightful Western medicine as bankruptcy law, to make the transition to a market economy, like a hole in the head.

The process of transformation will be difficult. A shared vision in East and West of joining in a unified European market will be vital in keeping that process on track. When I talk about a European market, I do not subscribe to the automatic absorption of those countries into what we know as the EC. Such a market, in my view, is the key to the hopes of Eastern Europe of obtaining the new technologies, managerial talent, organisational methods and financial capital that are needed to overcome the dismal economic legacy of the past 40 years.

The noble Lord, Lord Brabazon, was quite right when he said that all or any of those objectives would not be achieved overnight. They will be achieved by hard work and patience. For the West, the reintegration of Eastern Europe into the market system will offer not only enormous investment and trade opportunities but also the best hope that the unleashed energies of the East will be channelled into peaceful and constructive purposes rather than into a renewal of ancient rivalries. Western countries are only now starting to realise and to recognise how much they need to do to support the changes in the East. They must provide more leadership and vision and far more generous financial support. The most fundamental support that is needed is a commitment to incorporate the Eastern European countries into a common European market. I repeat that I do not automatically assume that that will constitute the European Community as we know it.

As Eastern Europe ends trade restrictions and makes currencies convertible, Western Europe must be prepared to accept new imports from Eastern Europe. One of the consequences of these dramatic and traumatic changes is that the Soviet Union will be required to absorb large numbers of officers into civilian life. Of the half million troops that are presently being demobilised, approximately 100,000 are career officers who believe they are entitled, as ex-officers, to jobs and homes that are in short supply. That problem will increase as troop cuts grow. In my view, Mr. Gorbachev is not likely to forget that when Khrushchev tried to cut the armed forces from 5 million to 3–8 million in the 1950s and 1960s, the revolt of the military was the final nail in his political coffin.

The Soviets are not united in their own desire to leave Eastern Europe, and in particular to give up the GDR which they regarded as their prize in the Second World War. Related to that is the need to ensure that there is no evidence of Western triumphalism as their troops leave so that face is saved. Finally, we must not forget that the Soviets will have other preoccupations; namely, the restructuring of their economy and their problems with minorities.

What are the prospects of a new security order? What will it be based on and who will participate in it? Many speakers have referred to the CSCE conference which is planned for the autumn. The departure of troops from Czechoslovakia and

Hungary could well be completed by the end of 1993 at the latest, and it will probably be completed earlier than that. However, I think that the Poles will be the last to see the troops leave as the Soviets will want secure lines of communication for their troops through Poland until the final withdrawal from the GDR is completed. We on the Labour Benches want to see the maintenance of the defence of the UK at the lowest possible cost which will liberate resources for our industrial base and our economic reconstruction at the same time as maintaining our commitments to NATO.

We should stimulate the desire to play a full part in the establishment of a new security system for Europe which will encourage the growth of democracy and economic development in Eastern Europe. We should also welcome the continued progress in the Soviet Union under Mikhail Gorbachev towards economic reconstruction and the open society that he seeks.

How have the Western powers reacted to the revolutions of 1989? Some countries have responded piecemeal. The Americans have decided on defence cuts, as have the Belgians and the Dutch. The European Community, America and Japan have instituted substantial aid projects. Yet, although the 35-nation summit has been planned for the autumn there has been so far no effort at a concerted assessment of what has taken place and what the response should be. Such an assessment is essential and a British Government who really understand the significance of the events not only can but should take a lead in that assessment. I was very glad indeed to hear the noble Lord, Lord Brabazon, say that we should hear more on that subject when we hear from the noble Lord, Lord Belstead.

Cuts in defence expenditure and technological change have an impact on the armament industries— conversion from militarised economies, diversifications, making constructive use of the huge technological talents of the men and women employed in those industries. A sensible British Government should be conducting a major and fundamental review of the economic consequences of the peace process. In my view the Government have not even begun to think about it. Our policy on these Benches is that we should be working on that process now.

I was very glad to hear more than one reference to the need for a 1990 version of the Marshall Plan. My noble friend Lord Callaghan referred to that in his speech on 17th January. My noble friend Lord Cledwyn reiterated the point. We need a Marshall Plan for the 1990s. I hope that the noble Lord, Lord Belstead, will be able to say something about that point.

We on these Benches recognise the courage of Mr. Gorbachev and the pivotal part he has played and must continue to play in the future of Eastern Europe and the world. He deserves all the support he can get. From these Benches I say that he has our support in abundance.

Next, we sense that now is the time for Britain to play a significant part in creating new security arrangements for Europe and the world. In doing so we must never lose sight of the fact that the United States must be kept actively involved in all arrangements, for America has done much for which we in Britain and Europe can be truly thankful.

The continuing evidence of ethnic unrest within Russia and other Eastern European countries, referred to graphically by the noble Lords, Lord Beloff and Lord Hankey, brings the need for more patience and understanding. Britain must assist the process of reconciliation whenever possible. We must also recognise that as Germany achieves unification there will be an increasing need to assure her Central European neighbours that their security is not endangered.

We in your Lordships' House have had the great privilege not only to be here but to participate, albeit marginally, in world events as we have in our debate today. Make no mistake: we on these Benches take very seriously our opportunity and responsibility, both as the Labour Party and as the potential government of the land.

There is much common ground across the Chamber and on the assorted Benches in your Lordships' House. The school of thought which counsels haste slowly and which tempers our generous inclinations to compassion with caution so as to protect our security is a wise one. One step at a time, taken as quickly as is practicable, is wiser than a headlong rush into what we know not.

There is an air of excitement, of wonder and of hope wafting across the plains and the Channel. Even though we know that the times will prove dangerous, and sometimes dispiriting, we can join in the wonder and the miracle that after 45 years of darkness Europe has been given another chance. It is the bright light of the future towards which we must march. It is the opportunity to examine that prospect for which we express our grateful thanks to the noble Lord, Lord Home, and all others who have participated in our debate.

7.15 p.m.

The Lord Privy Seal (Lord Belstead)

My Lords, I should like to join with other noble Lords in thanking my noble friend Lord Home for today's debate. It has enabled many of your Lordships, led by my noble friend in his most interesting speech, to draw on very valuable experience in trying to chart our course for the future. My only regret this evening is the absence of the late Lord Stewart of Fulham. We miss him, especially on an occasion such as this.

My noble friend Lord Brabazon outlined at the beginning of the debate the issues and priorities facing us today in Eastern Europe and the Soviet Union. My noble friend also set out some of the ways in which Her Majesty's Government are responding to those challenges and opportunities.

The noble Lord, Lord Graham of Edmonton, in winding up for the Opposition, asked, what of the new security order? Quite rightly the noble Lord put his finger on the possibilities of utilising the Conference on Security and Co-operation in Europe, about which I should like to say a word or two in just a moment.

My noble friend Lord Home's debate is being held as we are witnessing a historic retreat from the ideology of the Russian revolution. That is most of all apparent in Europe, where the intolerant philosophy of communism deprived first the Soviet people and then the peoples of Eastern Europe of the opportunity to recover from two world wars.

In opening the debate my noble friend referred to the sheer pace of events. That is something to which several noble Lords have referred. My noble friend also recognised in his speech the fact that over the past four decades one thing did not change. That was the denial of political and economic freedom in those countries of Eastern Europe which we are debating, which has been immensely damaging to them. Civil society was oppressed by arbitrary one-party rule and was permeated with fear and suspicion. Individual creativity and initiative were frustrated or distorted to serve the purposes of the state. As the noble Lord, Lord Parry, said in his speech, barriers were imposed to isolate citizens from all but officially approved contacts with the outside world by placing restrictions on travel.

Our continent as a whole suffered the consequences of those denials of freedom. Since the war Europe has been condemned to over 40 years of division and enforced separation, felt most keenly in Germany and Berlin. The rich and diverse tradition of European culture and thought was interrupted as other great cities— Prague, Warsaw and Budapest— languished behind the Iron Curtain. Now at last there is a chance to repair the damage. There is the prospect of renewal, both of the societies formerly subject to one-party rule and of the relationships between the nation states of Europe.

Speaking of Soviet Russia, my noble friend Lord Dacre, while clearly recognising the risks and uncertainties which are inherent in the present situation, nonetheless expressed a measure of optimism for the future. It is the case that in the Soviet Union President Gorbachev has, to his credit, pursued an ever more radical programme of reform in an attempt to equip his country to face the economic and other challenges of the late 20th century. In Central and Eastern Europe overwhelming pressure for change has now brought to power leaderships which are committed to reform. The move everywhere is towards democratic politics and market economics. Although of course I recognise the dangers and the great problems to which my noble friend Lord Beloff referred, nonetheless I join with the noble Lord, Lord Bonham-Carter, in saying that now at last is a rare opportunity and that we have to do our best, we have to do all that we can, to give encouragement and support.

There is little doubt in my mind that the successful example of the West over many years has played its part in bringing about that transformation. However, we should not recall that in an empty spirit of self-congratulation. Rather, we must draw lessons from it so that we can open a new chapter in European history.

In Western Europe since the war, we have assured security and stability through close political relationships between our countries. We have developed organisations such as NATO, the European Community and the Council of Europe, mentioned specifically by my noble friend Lady Elles, in order to express our common values and interests in terms of common action. Working together within those organisations, we have succeeded in establishing lasting peace and growing prosperity.

The time has surely now come to broaden our horizons. We need to find ways to enable all Europe's peoples to share in the benefits which have come to us from co-operation in freedom. Our aim should be a continent free of the artificial divisions of the past. We should not, in so doing, neglect our own defences. NATO remains the cornerstone of our security and an essential vehicle for arms control negotiations. We could not have achieved 40 years of peace and stability in Europe without it.

Perhaps I may respond to the interesting speech of my noble friend Lord Eccles. We must keep the NATO alliance at the heart of our defence policy while adapting it to meet new tasks. The nature of European security is changing. Ideological confrontation is diminishing and it must be clear to everyone that good political relations arising from shared principles and outlooks are a far better way— and, as my noble friend Lord Home said, a more cost-effective way— to ensure long-term security than the confrontation of large opposing forces.

That is well illustrated by our experience of arms control. I think I am right in saying that progress with arms control has always been linked to the broader climate of East-West relations. In the CFE negotiations, we are now working towards balanced and verifiable reductions— a matter on which my noble friend Lord Home laid great emphasis in his speech. So the time surely is now right to work towards a more political concept of security in Europe where problems can be addressed jointly through co-operation.

Following the line of thought of my noble friend Lord Home when he spoke of a pan-European system, my right honourable friend the Foreign and Commonwealth Secretary has suggested that in the new political climate in Europe we should develop the Conference on Security and Co-operation in Europe— the CSCE— which adopted the Helsinki Final Act in 1975. We should develop it as a unifying framework for political stability within which we can work to make democracy and human rights more permanent and secure across our continent. That point was made well over a month ago by the noble Lord, Lord Cledwyn, in the debate initiated by the noble Lord, Lord Callaghan, and was repeated by the noble Lord, Lord Cledwyn, from the Opposition Front Bench today.

The CSCE offers a number of advantages. It has the right membership for it comprises the nations of Europe, including the Soviet Union, together with the United States and Canada who will continue to play a vital role in European security— a matter emphasised by my noble friend Lord Eccles and to which the noble Earl, Lord Perth, devoted his remarks. Moreover, the CSCE's agenda includes the subjects with which we shall be most concerned— democracy, human rights, security issues, frontiers and co-operation in general.

The CSCE also has to its credit an established record of achievement in improving respect for human rights and strengthening military confidence. But, in the years since 1975, it was difficult to develop its full potential while governments in East and West had different attitudes to human rights and democratic freedoms. However, now, for the first time, all 35 participants display a wide area of agreement and genuine commitment in their approaches to the Helsinki principles. The opportunity exists to translate that into forms of co-operation which will strengthen the welcome political trends now emerging in Central and Eastern Europe. The need is for ideas which can be endorsed by the CSCE summit meeting later this year, as a basis for future work.

Britain has already offered some suggestions. Last year, at a CSCE meeting in Paris, Britain, the United States and other countries put forward proposals outlining criteria which might be observed in order to guarantee the freedom of elections and reinforce the rule of law. That is soil in which democracy can put down strong and lasting roots in countries where for so long democracy has been denied. We hope that our practical proposals, designed to serve the end, will be reflected in the conclusions of the forthcoming summit.

I was interested in the warning by the noble Lord, Lord Hankey, of the possibility of trouble which might occur within Eastern Europe in the future. Picking up that point, perhaps I might say that my right honourable friend the Secretary of State has also recently proposed a role for the CSCE in conciliation as a way of peacefully settling disputes that might arise between its participants. There is, for example, the possibility, which I believe was in the mind of the noble Lord, Lord Hankey, that reawakened nationalism might lead to tension and argument between different European countries. It would be the job of the CSCE to seek to prevent the escalation of such disputes. We are working on some more detailed suggestions for the kind of procedures that might apply in such cases and we intend to make those public in due course. We believe that the summit should also consider whether the CSCE is well enough equipped for the wider role that we envisage for it. We hope therefore that the summit meeting will also look at the ways in which the CSCE's work is organised to see whether those can be made more effective.

All noble Lords who have spoken today have referred to the subject of German unification. I join with all noble Lords in welcoming the prospect of a united and democratic Germany integrated securely into the wider European framework. We respect the choice of the people of the German Democratic Republic, as we have always respected the right of the German people to self-determination, and we are ready to work to help them achieve unity.

Perhaps I may say in passing that it was the concern of my right honourable friend the Prime Minister about the need to consider the important external aspects of unification which led to establishing the two-plus four mechanism. The noble Lord, Lord Greenhill, underlined the importance of that in his speech by making the point that agreement in the two-plus four talks with the objectives of settling borders and obtaining agreement about new arrangements between NATO and the Soviet Union, are matters of the highest importance. The first meeting of officials in the two-plus four talks took place last week and agreed, in response to clearly expressed Polish wishes, that Poland will be involved in the two-plus four talks when border issues are discussed. We also favour full consultation in NATO and the European Community which must ensure that all concerned are satisfied with progress towards unification and that the external issues are being properly addressed.

Finally, there is the wider process of bilateral contact and consultation which is going on all the time. On the subject of carrying out those important discussions, particularly about external matters, my noble friend Lord Fanshawe of Richmond said that we must work closely with France. I take that point very much to heart. We must, and I assure my noble friend that we do. Perhaps I may tell the noble Lord, Lord Bonham-Carter, that we in Britain are working closely with our European partners in order to try to build a more secure and more prosperous future for Europe. In doing that, so far as concerns German unification, we, the federal republic and our allies and partners know where we wish that process to end. For reasons that were made clear by the noble Lord, Lord Cledwyn, we want a united Germany to be a full member of NATO and of the European Community. However, as my noble friend Lord Brabazon said at the beginning of the debate, there are still some important stages to be negotiated on the way to that conclusion.

The noble Lord, Lord Cledwyn, asked one direct question: what about Germany's NATO membership? It is a subject on which we remain at variance so far as the Soviet Union is concerned. We hope that Soviet objections will not prove insurmountable.

As my noble friend said at the beginning of the debate a wide consensus exists on that point as well as a readiness to take into account Soviet security concerns. While we naturally anticipate that forces of NATO allies will continue to be stationed in West Germany, we believe that special transitional arrangements may well need to apply to East Germany. I hope that our continuing discussions with the Soviet Union in the two-plus-four talks and elsewhere will enable us to set Soviet fears at rest.

Meanwhile so far as concerns the Community we look forward to an open and thorough discussion within the Community on Community aspects of unification. We hope that the informal summit in Dublin next month will start the process of detailed negotiation and that it will be possible to incorporate what is now the GDR into the Community framework as quickly as possible after unification.

The noble Lord, Lord Moore of Wolvercote, and my noble friends Lord Dacre and Lord Belhaven and Stenton, referred to the absolutely crucial issue of the maintenance of the Oder-Neisse line. The recent resolution of the Federal German Parliament in favour of guaranteeing Poland's existing western border is an encouraging basis for future work. Britain will certainly do all it can to ensure that this results in a treaty which is acceptable to both sides. We are also ready to play a full and constructive part in the discussions that lie ahead on the future of the legal rights and responsibilities of the four powers in Germany and in Berlin.

Perhaps I may say a few brief words about British aid to Eastern Europe. They will be brief because earlier my noble friend Lord Brabazon spoke about this matter at some length. My noble friend Lord Home, the noble Lord, Lord Cledwyn, and other noble Lords spoke about the enormous importance of economic assistance to the reforming countries of Eastern Europe. Let me once again emphasise what is being done. The noble Lord, Lord Cledwyn, asked for confirmation that any aid will be co-ordinated through the European Community. Obviously, the international agencies— the IMF, the World Bank and indeed the Group of 24— are absolutely crucial to the international effort that is being made. But, as the noble Lord, Lord Thomson of Monifieth, quite rightly said, the Community has a very important part to play.

It is no mean feat for the European Community, international financial institutions and individual Western countries including ourselves to have come forward with such a wide range of initiatives in a matter of only a few short months. The initiatives range from emergency relief of various kinds to stabilisation funds and our own know-how funds, mentioned specifically by my noble friend Lady Elles and the noble Lord, Lord Thomson. They spoke of the importance of training for which the know-how funds will be useful, as indeed will be the establishment of a European training foundation which is now being discussed as a result of the Strasbourg summit.

There are other kinds of support for far-reaching structural reform, Community trade and co-operation agreements and, in due course, association agreements, which will serve to sustain and strengthen the economies of Eastern Europe as those economies develop along new and very different lines in the months ahead. I am absolutely certain that the quality and quantity of Western support will continue to grow. There can be no doubt that a very substantial start has been made.

Perhaps I may pick out one other point on aid. The noble Lord, Lord Moore of Wolvercote, emphasised his belief that this country could help in the development of democratic institutions in the countries that we are discussing. I simply say that in all that we do, particularly in contributing and providing training, we shall keep in mind very much the words of the noble Lord.

Finally, the noble Lord, Lord Kagan, spoke about the Baltic republics. It seems likely that there will now be negotiations between the Lithuanians and the central Soviet authorities. We hope that these negotiations will begin soon and will help to ease the disturbing tensions that have recently arisen. We hope that negotiations will lead to the people of Lithuania achieving their wish. President Gorbachev and other Soviet leaders have stated clearly that there can be no resort to force in this delicate situation. We welcome those assurances and believe that negotiations are the right way forward.

Many noble Lords, while being quite realistic, have expressed hopes about what is happening in Eastern Europe and the Soviet Union. Of course there is also uncertainty and the risk of instability which one cannot afford to discount. My noble friend Lady Strange was quite right to anchor the issues that we have debated today in the rich and chequered history of our continent. But, contrasting the state of Europe today with its history of division, injustice and conflict in decades gone by, I believe that we have reached a turning point. New aspirations and new energies have been released and with them the opportunity to bind together the nations of Europe more closely than before. Before us is the promise of a decade in which freedom can be firmly established across our continent.

The Government are determined to work to fulfil that promise. Our aim is to have a new pattern of relationships in Europe based on democratic values in which all can prosper and feel secure; likewise, in our contacts with the countries of Eastern Europe and the Soviet Union, in our approach to German reunification, and in our work in NATO, the Community and the CSCE. This is and will remain our consistent goal.

7.35 p.m.

Lord Home of the Hirsel

My Lords, it remains only for me to express my gratitude to the many noble Lords who have contributed to this debate from a wealth of varied and specialised knowledge. It has been a fascinating exchange of views and, I think, a rewarding one for all who have been present.

The debate has illustrated the enormous programme of constructive negotiations which have to be undertaken in the months and years ahead, essentially by the United States, by Members of the European Economic Community and by the Soviet Union, if we are to build together in binding treaty form— because that is the form that it will have to take— the foundation for a lasting peace in Europe and the Atlantic area. I am grateful too to my two noble friends who spoke from the Government Front Bench for telling us that it is the Government's intention to play a leading part in that peaceful design.

Like many of your Lordships, I have lived through two world wars. Anyone who has done that, and anyone who has some knowledge of history, is unlikely to be anything but cautious. It is right that we should exercise caution. I say only that if the spirit which has animated speakers from all sides of the House in this debate is reflected outside this Chamber, as I hope it is, then the approach to the future can be looked upon with cautious optimism. I beg leave to withdraw my Motion for Papers.

Motion for Papers, by leave, withdrawn.